The Ramsey Show - App - We Have $550,000 in Student Loan Debt! (Hour 1)

Episode Date: August 2, 2019

Rachel Cruze, Savings, Debt   Tools to get you started: Debt Calculator: http://bit.ly/2QIoSPV Insurance Coverage Checkup: http://bit.ly/2BrqEuo Complete Guide to Budgeting: http://bit.ly/2QEyonc Interview Guide: http://bit.ly/2BuGnZE   Check out other podcasts in the Ramsey Network: http://bit.ly/2JgzaQR 

Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, this is The Dave Ramsey Show, where you learn to take control of your money and create a life you love. I am Ramsey personality, Rachel Cruz, filling in for Dave this hour. And I'd say it's kind of a monumental moment because it's the first time I'm hosting live in our new studio. And I know we've been excited about this and I'm sure Dave's been talking about it a lot, but I'm like, man, it's just, it is.

As I walked in here today, I was like, it's just crazy. And I think the offices are open August 15th, I think is the date that you guys from All of America can come in, hang out in our new space. And it is just, it's unbelievable, you guys, unbelievable. And from my viewpoint, looking out all the signs and all the sayings and the debt-free stage that we have set up for debt-free callers. It's just, it's incredible. But right across the hall is a car. You'll see this when you come. We have our coffee shop. And there's a half of a car. They bought a car and cut it in half. And it's the Lincoln Continental, which is the car that dad used to drive and sell books out of the trunk of the car.

And it's so funny because I remember this car. So the car in the coffee shop you'll see is blue, but dad's actual car was a terrible brown color. And I remember growing up driving around in this terrible car, and he did. He had a box of books in his trunk. And that whole display is there, and right above it, it's one of our favorite sayings around Ramsey Solutions that it says, don't despise humble beginnings.

And every time I see that, I'm like, you know, it is. It's just wild from where the radio show, even just the studio was, you know, two decades ago. And then moving into Financial Peace Plaza, the building we used to be in for about 10, 15 years. And that studio was just, we thought was amazing. And then we moved in here about two weeks ago and it's just blown us all away. And I even think back as starting as a Ramsey personality. 10 years ago, we didn't have personalities.

And I remember I was challenged by some people in leadership that I had to have my quote unquote megaphone. They said they're like, you know, Dave has the radio show that he gets his message out and he gets to interact with callers all day, every day. So like, what are you going to do? And I was like, I don't know. I mean, I don't really love radio. I'm liking it more and more, you guys. I'm thankful to be here. But it was not my favorite thing. And I was like, I don't know, I enjoy video. And so I can remember, you know, we had no budget for what I was doing. And so my leader at the time during his lunch break went to Best Buy and bought a flip camera that had been returned from someone because it was that terrible. But it was like half off, open box,

bought the flip camera, bought a tripod and gave it to me that afternoon. He was like, here. And then I remember he was like, here. And then I remember he was like, just go down to the video team and see if someone can show you how to edit video on your laptop. Cause you know, we can't provide an editor or anything. So you'll have to figure it out. And so I started my own videos and I uploaded them to YouTube all by myself and like started there with the video blog. And then, you know, I look at what I'm doing now with the Rachel Cruz show on YouTube and I'm like, and it's a whole other, you know, I look at what I'm doing now with the Rachel Cruz show on YouTube and I'm like, and it's a whole other, you know, it's a whole other world. Like it's just,

it's just wild. But I'm like, man, starting and going back and appreciating the beginning. And so many of you on your money journey, you're starting out. Like some of you are hearing this show even for the first time. Some of you decided, okay, you know, this summer we're going to really buckle down and we're going to do something different with our money. We're going to really change the way we've been handling our money and you're starting out. And so don't despise those beginnings because when you do hit these monumental moments, whether it's that you get to scream you're debt-free, whether it's that you're finally funding retirement, maybe it's you're sending your kids off to college and you're able to pay for it. Whatever those monumental moments

are, you get to celebrate and enjoy those because you've worked so hard for them. But you get to look back at the beginning of your story and say, that is where we started and that is where we've come from. So whether it's with your job, with your money, don't despise humble beginnings. I'm just seeing that car cut in half, glued to the wall with that sign above it. It is. I mean, it just gives me this amp of energy of like, man, don't forget where you started, you guys.

Don't forget where you started. Do not despise humble beginnings. Well, again, I am Rachel Cruz at Ramsey Personality filling in for Dave this hour. So it is a free call anywhere in the country at 888-825-5225, taking your calls. All right, coming up first this hour is Janine from New York. Hey, Janine, welcome to the show. Hi, Rachel.

Thank you. How are you? I'm doing great. Thanks for calling in. How can I help? I wanted your opinion on whether I should buy my car at the end of the lease with cash or if it's too expensive. So I'm on baby step two and the lease will be paid off this month. And after that, there's two years left for me on it.

So the buyout will be $22,000. I was wondering if I should save up the cash during that time to buy it or if that's too much to be spending on Baby Step 2. Okay, and how much do you make a year? $105,000. $105,000, okay. You have a good income coming in. And you can save and pay for it within, what, 24 months?

I could save up over the two years, or if I wanted to, I could pause Baby Step 2 and save up for it in about six months. Okay. No, I would say continue on with Baby Step 2, stick the lease and the debt snowball. But kind of the rule of thumb we always say with cars is if you can't pay it off or if you can't buy it out of the lease within 18 to 24 months, sell it. So you're right at the cusp of the mathematics of the numbers, if you will. So yeah, I would say for you, you can choose what to do. I mean, is it a car that you just absolutely love or do you feel like you could sell it and find something cheaper just as great? So I do really love the car and it would last me a long time,

but I do have a lot of student loan debt. So I don't know if I should be spending that kind of cash on a car. Okay. How much debt do you have total then with the student loans? My total is $120,000. Ooh, girl. Yeah. Yeah. Yeah. I'd get out of it. Yeah. Okay. Yeah. The lease is paid off. So I guess should I keep driving it while it's paid off and then just get something cheaper when it expires? Exactly. Yep. That's exactly what you need to do. Yep. I know. I mean, and this is always a tough situation because we love our cars, right? You're in it. You're like, this is what I want. Beautiful.

But the great thing is, is that you don't have you can go back to that car eventually. Like you can save up, you know, once you're debt free and be able to get the car that you really want. And so that's always like the hard part of the sacrificial mindset. But when you but yeah, I mean, considering obviously having $120,000, probably most of that is student loans from what you said earlier, then yeah, you definitely want to get out of that and just get out of debt. Because once you're out of debt, and you have your emergency fund, you know, that may take depending on your, you know, your incomes 105. So you know, you could say maybe two years. And then after your emergency fund's fully funded, you could look up and it'd be, you know,

three years later and you're like, oh, I don't even really want that kind of car. I want a different car. And you save up for something different. Like what we think we need changes so quickly over time. And that's part of the process I love about sacrificing to get out of debt is the things that you think you need and you really, really, really, really want. That stuff shifts, like your desire shifts, your priorities shift. And so once you are debt free and you have that emergency fund in place and you save up for the car you really want, it may change. But thanks for calling in. This is The Dave Ramsey Show. show. We've been voted one of the best places to work in Nashville 11 times. You want to know how we do it? Well, our team has been using LinkedIn jobs for years to find the best people from all over the country to come and help us change lives. Think about it.

LinkedIn has more than 600 million active members. I'm talking about people who come to LinkedIn to make connections, grow their careers, and discover new job opportunities. In fact, 90% of LinkedIn users are open to new opportunities, but not actively scanning job boards. This means LinkedIn Jobs gives you access to an entirely different demographic. Don't wait. One hire can change the direction of your company. Post a job today at linkedin.com slash ramsey and get 50 off your first job post that's linkedin.com slash ramsey terms and conditions apply Welcome back to the Dave Ramsey Show.

I am Ramsey personality Rachel Cruz filling in for Dave this hour. And it's a free call anywhere in the country at 888-825-5225. All right. Coming up next is Rebecca from Texas. Hey, Rebecca. Welcome to the show. Thank you. How can I help?

Well, I have a question about how to advise my teenage son. My husband and I have both lived very frugal lives and saved a lot and live pretty comfortably now. And we're able to set up a college fund that will help him if he lives frugally himself. It should allow him to not incur a lot of debt. But he has about $6,000 worth in savings, and he's seen some preliminary investments do very well in the stock market, and he was wanting to invest more of his savings. But there is also a concern that maybe he should just keep the cash in the bank

versus he's just gotten really interested in the stock market. And like I said, he has invested about $1,000 and he's seen it grow quite a bit in the past two years. Is he doing the investing himself or is he using an advisor? Like when you're saying that, is he like day trading on his own at his computer or like what's he doing?

No. Well, my husband and I, we have index funds. And so that's what we set him up with too. It was his money. And his name is on the account, but he's not of age to do that. But we're trying to do things to give him exposure to adult financial decisions while we can still mentor him. And he is just really excited about that as well as, you know, other financial studies. Totally. Yeah. So, so what's your question specifically?

Well, don't know whether it would be advisable. He would like to invest more of his savings in the funds that he has. Gotcha. But my husband was really thinking he should not invest anymore because he plans to go to graduate school in a couple years or medical school in a couple years. And just don't know when you're going to need that cash. But I don't know which way to go. Yeah, no, no, no. It's a great question. Well, number one, I think it's awesome as a parent that you're talking and teaching your child this. I mean, like your teenage son, because so many people, you know, they don't even, they can't

even explain what an index fund is or what a mutual fund is. I mean, like, so him having the basics and understanding the power of what investing does is he has such a leg up, but he's going to be going to school. And I heard you just say you kind of breezed over it, but you said he will not be occurring a lot of debt. So is his entire school paid for? What's his situation with that? Well, my husband and I both worked our rears off to get out of college, medical school, graduate school without debt. So we're very fortunate in that way. And he has enough college fund that if he is frugal and does not spend any more than he has to,

and he also got some scholarships, that he will also get out without debt. Okay. Okay. So he's not planning on taking out any student loans in this process. He is not planning on it. Yeah, that's great. Okay. So I think at this point, I mean, I always tell, you know, college students, especially when I'm talking to them, I'm like, okay, you have your whole life to invest. Yes. Mathematically, the earlier you start, the better off you're going to be a hundred percent. But this stage of your life is so up and down. Like you have no idea really what you're doing with your life. You know that you may be locked into a school for four years, but after you graduate, you may realize you had a major

that you didn't even want to use anymore and you want to go into a totally different field. Maybe you do want to go to medical school or grad school. Who knows what you want to do? And so having cash available right there to be able to have and to use is going to be extremely important. And just say maybe he meets the love of his life, you know, after college, and they want to go put a down payment on a house or something. And so for me, I always like to have some cash saved up. So for me, I think it's awesome he's saving and he's investing, but I would wait until after the season of life, and I would say after college

and he has some future plans kind of set in stone, that's what I would do. So should he just leave that in his very low interest bearing, just regular savings account? Yeah, he could even open up like a money market account and put it in there. Yeah. But to have it so it's liquid, you know what I mean? To be able to get to it quickly if he needs, if something changes, because it is, it's pretty impressive. So I'm just curious, I'll have you on the phone, Rebecca. Because I'm like, I think it's always fascinating with parents, because I grew up in a home where money was talked about and money was taught. So I want to know for you guys, like what was one of the things you did to get your son to this point where he's interested in investing that he has $6,000 of his own money saved up that he's going to college,

like there's a plan in place? What kind of encouragement do you have for parents who are maybe facing that with teenagers in the house? Well, we started in 10th grade where we did kind of a life skills class. They had to read a number of financial books. We started a little bitty when they got allowance and they had, we opened a bank account for them and they had to go physically go when they were seven and eight and deposit their saved money, even if it was just a little bit, and they had to save half of their gift money in their bank account.

And so that was the beginning. And then as they got into early teenage years, they could earn more money through chores, in which case most of that went into savings. And then in 10th grade, they read a bunch of books about just finance. And we also demonstrated, you know, saving, saving and not having debt. We don't have any debt when we've been able to save quite a bit and buy some rental homes and live pretty comfortably now through our frugal means. And then after that, they set up a checking

account where they have a debit card. And I know Dave doesn't like this, but we do give them access to a credit card where they learn how to pay it off every single month, which is how we live. And my son is amazed that others don't live like that. Yeah, right. Credit cards can be very helpful, but it's a payoff every single month, and there's no question. If you don't have the money, you don't spend the money. And they just don't. We aren't a big material family, and so they don't spend a lot of money. So good.

They save most of their money, and now he's able to i say if you save don't spend more than you need then when you need it it will always be there so great rebecca well thank you seriously so much just for that because what i think that this proves you guys not to throw you into the brush rebecca except for the credit card part obviously i can't be dave ramsey's daughter and affirm that that part of it but man how, how intentional they were, you guys. Did you hear that? Starting from taking the kids to the bank, starting from teaching them how to read financial books, making them learn these things.

As a parent, that's what it takes. So many parents say, okay, so how do I teach my kids about money? It's that kind of thing, you guys. It is being so, so intentional. And they're watching you. Like, more is caught than taught. And so you don't have to sit down with your four-year-old and have to explain what a mutual fund is. But letting them have life experience and for you to expose yourself and your money, you know, and if you're married, your spouse, like showing them what does it look like to live on a budget? What does it look like to say no to yourself as a parent?

Like that example is tremendous. And so when I always get parents that like sounds like they have a good head on their shoulders, like I could tell Rebecca did. I was like, man, I just want to know because encouragement again to you parents out there, when you're on this debt-free journey, when you're starting down this path and you're saying, okay, you know what?

We're going to get out of debt. We're truly going to change our family tree. That in and of itself, your kids are watching. But when you just go a little bit more of the extra mile and you pull them in and you pull them into conversations, you show them what's going on. You show them how you're paying bills, all of those things. They're learning that. And I'm currently writing the manuscript for my new book. And I've done so much research on how people grew up. And it's just that part I've always

known as somewhat lacking in the household in America, but it just became more evident to me how lacking it is of teaching our kids how money works. And in a common sense way, I mean, showing them if you don't have the money, you don't buy it. Money comes from work. Money doesn't come from mom and dad's back pocket. And so putting them on commission versus allowance, like all of these things come into play. And that is what changes. That's what changes your entire family tree. And for a lot of you, that's your why of why you want to get your money under control is, is so that your kids don't have to make the mistakes that you've made. And so I think Rebecca is, is just one of those parents in America that she's proof of it. She really is.

So parents out there, you're doing a great job. Continue to change your family tree. This is the Dave Ramsey Show. I got a call the other day, and I thought it was worth talking about again. It was from a wife looking for life insurance for her family. She asked why I only recommend term life insurance instead of cash value plans like Whole Life. I usually explain how you overpay for coverage, earn a horrible rate of interest, and don't get your cash value when you die. But this time, I just had her go straight to Zander.com and get a rate. And then we compared that rate to

the whole life plan, and she immediately saw the huge savings. She realized all the things she could do with that money, like paying down debt, investing in a smarter way. That made it real for her. It makes no sense to buy or keep a cash value plan when there are smarter, less expensive ways to protect your family. That's why I suggest that everyone go to Zander.com or call them at 800-356-4282 and get a free quote. That's Zander.com or 800-356-4282. Welcome back to the Dave Ramsey Show. I am Ramsey personality, Rachel Cruz Cruz filling in for Dave this hour. We're taking your calls about your life and your money.

It's a free call anywhere in the country at 888-825-5225. It's crazy that it's August, August 2nd. And I feel like I know it's not summer or I know it's not fall, but it feels like fall. In Tennessee, all the kids go back to school beginning to mid-August, and I know most of you up north, it's like after Labor Day, but that's when my girls go back to preschool. But this fall, you guys, we are traveling all over the country. Well, I say we. I will not be. Being seven months pregnant, I will be out on maternity leave this fall. But our other Ramsey personalities, Chris Hogan, Anthony O'Neill, and of course Dave Ramsey,

will be traveling around with our live events. We have Financial Peace Live coming to Austin, Orlando, Seattle, Phoenix, Charleston, South Carolina. You guys check those tickets out at DaveRamsey.com. And then our Smart Conference is November 16th in Sacramento, California. And those are so fun. If you have not been to a live event, they're phenomenal, you guys. I mean, they are so much fun to be a part of. And it's just being in a room with thousands of people, like-minded people, who are on the same journey as you are of getting out of debt, learning about this stuff,

because I love it. People come to learn how to get started and how to do all of this, but a lot of people come just for motivation because they want to be around people that say, okay, we're not the only ones doing this crazy plan of living debt-free. There's obviously thousands of other people doing it,

millions across America, but being in person and hanging out with us, it's awesome. So if you are in those cities, I mean, I even thought, I'm like, man, these are Austin, Orlando, Seattle, Phoenix, and Charleston. Those are like great getaway cities too. So if you need to have a little getaway with the spouse or something, I mean, those are fun cities to travel to. So make sure to check those live events out again. You can get tickets at DaveRamsey.com. All right, coming up next is Stephanie from California. Hey, Stephanie, welcome to the show.

Hi, Rachel. How are you? Hi, I'm doing great. How can I help? All right. So I am 32 years old. My husband is 33. We are both attorneys. We met in law school, and I'm also expecting our first baby.

Oh, congratulations. Yes. When are you due? Not until March. Okay. It's very, very new. Oh, yeah, very new. Yes.

Good. I know that feeling, girl. So I feel you. I feel you. Yeah. So my question, unlike, I guess, the last caller that you had, I didn't have parents like her. So we are in a lot of student loan debt. Obviously, we met in law school.

So we both have law school debt. And our student loans total $550,000. Oh, my gosh, Stephanie. Yeah. It's hard to breathe. When we first got married, we also had credit card debt and some other debts. And so we've already paid off about $60,000. So this is like the mountain that we're now climbing is this last push. This is our only debt left, only in quotes. Our household income is $150,000. We've only been in practice for a couple years, so we're still new in our careers too. But really

what my question focuses on is the interest rates on our loans are really what's crushing us. Their interest accrues just for my portion of the loans at about $1,600 a month. We put extra towards our loans every month. Obviously, we've been working the snowball. But the majority of our extra payment goes towards that accrued interest and barely touches the principal. When I spoke to our loan service provider, if the extra payment could go directly towards the principal, they essentially told me no. So I'm just trying, I'm feeling a bit hopeless. How can we best get traction on these loans, especially given the amount that we have? I think refinancing is also going to be difficult.

And I'm just feeling like we're never going to be able to accomplish our future goals of like buying a house and building wealth with this amount of debt and interest accruing. So I guess any help? Yeah, no, totally. No, absolutely. And I feel overwhelmed for you, right? I mean, like just seeing these numbers, it's staggering. I mean, that's more than most people's houses of what, you know, what their house is worth is more than what you guys have in student loans. So it is, it's a, it's a real thing. And I think it's one of these things that you have to realize, okay, it's done. You can't go back. And so what are you going to do moving forward? And so one thing is, cause you've thrown in the baby card. So I have to say this because you're pregnant, you're going to pause on the debt snowball. So you're going to payment

on payments, stay up to date, but you're going to pause that until you have this baby in March. Because that whole, I mean, this, you never know what's going to happen. We want to make sure that you're taken care of, baby's taken care of, and having cash on hand in order to do that is going to be really crucial. So pausing, paying off debt, which I know is hard because you're like, oh my gosh, we're so motivated because 60 grand and you've already paid off and you have half a million dollars in student loans. But you want to do that.

And then come March, when all's good, you're home, baby's home, everyone's good. And then pick it back up. So what you're gonna have to find, Stephanie, is that your income is going to have to come up. And I know you guys are just starting out, but whatever that looks like, whatever it looks like to make partner,

I mean, whatever happens in your field, something has to change. You guys have to get your income up. And that may mean working a second job for your husband for a little while and you doing something from home, possibly if you can, like bringing in any kind of money

because the numbers you just gave me and I know living in California, it's going to take you guys a long time. I mean, it's going to take you years. And so the faster you can do this, the more willing you are to sacrifice your lifestyle, to sacrifice your time to put towards this debt, the faster it's going to be paid off. But man, it is a hill to climb and you guys are going to have a huge trek ahead of you. And faster it's going to be paid off. But man, it is a hill to climb and you guys are going to have a huge trek ahead of you. And so it is going to be a few years. So you're going to have to pause all these things that you're going to want. You already said it, but it's true. Wanting to buy a house, wanting to invest, wanting to do these things,

it's going to take a few years. And so you guys have a marathon ahead of you. But when you have this mountain of debt, this is true for anyone, the deeper you are willing to sacrifice your lifestyle and your time, the faster you're going to get out. And so I'm like, lace up those marathon shoes, girl. This is a journey. It really is. It's going to be a while. But at the end of the day, it's going to be worth it. And your income should be going up throughout those years. Hopefully you make partner. All those things start to happen where that income goes up. But I'd be working extra jobs. I would be finding ways to bring in anything that you can in order to pay this off.

Because half a million dollars in law school debt, that's daunting. And so I would even get out a sheet of paper have it on the fridge and break it down by even like 30 50 thousand dollar increments just to check off like I just maybe it's my personality but I'm like I need check marks I need to see progress being made and so finding those bite-sized things finding things in between the debts with a when you pay it off to go and celebrate not spending a ton of money, but going and enjoying yourselves, doing what you can during this time because it is. It's a huge mountain.

And this student loan whole thing, you guys, Anthony O'Neill is going to come on with me next hour, and this is like his bread and butter is talking about student loans. But it's just become absolutely insane of what we've done as a culture of just expecting this whole idea, okay, you know, we have to go into student loan debt. It's just the only way to do it. And even things like law school, medical school, graduate school, like there are other lanes, there are other options. We've heard story after story of people doing this in a creative way. And so this is a preventative, I guess, message,

because if you're already in it, like Stephanie is, you know, you've got to deal with it. But those of you, you parents out there, those of you that are starting this, like this is something to avoid. Learn from Stephanie. Learn that it is not worth it at the end, because here's the deal too. What you don't think about and what your college student is not thinking about is like, maybe she gets pregnant and maybe she has that baby and she wants to stay home with the baby. She's not going to have that option. Like there's not going to be a choice to be able to do those kind of things in order to bring in just to pay off the interest, which is $1,600 a month.

Like these are life choices that have consequences. Can you get out of it? Is there hope? Always. Always there's hope. But you have to realize what you're signing yourself up for. And parents out there, educators out there, we have got to educate the next generation on this topic because it's crushing, it's crushing this generation. This is The Dave Ramsey Show. Thank you. Welcome back America to the Dave Ramsey show. I am Ramsey personality,

Rachel Cruz filling in for Dave this hour. And it's a free call anywhere in the country at triple eight, eight, two, five, five, two, two, five. All right. Going to the phones. for Dave this hour. And it's a free call anywhere in the country at 888-825-5225. All right, going to the phones. Ariana from California is up next. Hey, Ariana, welcome to the show. Hi, thank you. Absolutely. How can I help? Okay, so we're on baby step number two and um i heard about dave ramsey in 2009 and had my own graduate school debt of 105 000 which i paid off in four years and now it's like repeat my husband went to school and got his own debt so um and we've been married for 14 years so we've been through it

together but my question for you is how do we maintain the long-term gazelle intensity? Just specific advice for huge loans. We still have $266,000 left. Jeez. $266,000. What do you guys make a year? Just over $300,000. Okay. That's a good income. Yeah. To be able to knock out. I mean, you guys, I mean, when you look at the numbers, I'm like, man, if you could live like we teach on rice and beans, beans and rice.

Right. I mean, yeah. I'm trying, but it's like we're on year eight of this. Yes. Of doing it. So did he go back to school while you guys were paying off debt? Or have you just always had this debt and you just haven't paid it off in in 10 years no no this is um so i had grad school from 2009 to 2011 and then he went in 2010 to 2014 so we overlapped okay and i just kind of compartmentalized mine because i thought okay

if i can knock out 105 then i can anyway focus on focus on my small victory and then it's just a lot go it is it is a lot so I'd say a couple of things around a number one um just in our brief conversation that we've had I would encourage you it's I know you guys are working together but whenever I hear couples say well his debt my debt my my debt, my victory, his thing, like when you start to, the pronouns start to be separated. I really want you guys to even something as simple as changing your vocabulary,

which sounds so elementary, but by saying like, this is our debt together. It's not his debt. It's not my debt. It's our debt together. Here it is. And you guys could have this knocked out. I mean, making 300K a year,

I mean, that's obviously probably before taxes are taken out. Yes. And you're in the great state of California, which loves their taxes. So I know that you're not taking home 300,000. But yeah, you guys continuing on this journey. I mean, and I think when you get to the point, I mean, because of kind of how it was like back and forth, it felt like, and you guys just weren't on the same path, you have to be focused. And I feel like that's part of gazelle intensity that some people don't always really focus on is the focus part. But I'm like, man, we are a culture that we are just all over the map. And so it is easy to say, okay, we've been doing this for so long. I don't know if we can keep up with it.

Like, oh, what do I do next? But sticking the course and saying, okay, we're going doing this for so long. I don't know if we can keep up with it. Like, oh, what do I do next? But sticking the course and saying, okay, we're gonna pay off small, small, just in if those 266,000 are separate, separate those out in the debt snowball and do the program and you guys live on nothing. Go back to how you lived when you were in grad school. Go back and say like, okay,

we're not paying for anything. We're putting all of our money towards getting out of debt and staying the course and staying motivated. But again, this is the second caller, you guys, in an hour with so much student loan debt. It's driving me crazy. I'm so glad Anthony's coming on next hour so we can address this more. But it is insane. It is absolutely insane. And thankfully, you have a huge income. But keep chipping away. Just keep chipping away. All right. Up next is Brooke from, oh, California as well.

Hey, Brooke. Welcome to the show. Hi, Rachel. I'm so excited to talk to you. Awesome. I'm glad you called. How can I help? Okay.

So my situation, so my overall question is, what am I supposed to do when my spouse is not on board or is committed to me when it comes to just becoming debt-free? We are 25 and 27. We just bought a house three years ago. We're in about, so aside from our mortgage, we're in about $28,000 of debt, about $2,000 of car debt, and the rest is all just credit cards. So $26,000 in credit card debt?

Yes. Okay. What did y'all buy? I'm just curious. So a lot of it was, yeah, so prior to buying a house, we had like super cheap rent, and we were just kind of in this habit of spending a lot on just random stuff. Yep. And then we bought our house and our rent, it basically quadrupled is what we're paying now for our house.

And so, um, it's just, we never got out of that habit of just spending money on just random, you know, stuff that just comes up. Sure. Totally. No, no, no. You're good. You're good. And I, whenever I hear a large credit card, I'm always like, what'd you buy?

What was it that caused it? Nothing that I can tell you right now. Yeah, which is a huge point to the whole credit card thing. I had a post go out on Instagram about store credit cards. And people, of course, were like, oh my gosh, Rachel, but we use ours properly. And I pay it off every month and all this stuff. And I'm like, yeah, but when you get in a bad habit like that, it's these little things. It's life that happens.

And when you have plastic in your wallet, that's what ends up getting charged. Okay, we'll get off the credit card ramp. But $26,000 there, $2,000 of what was the other $2,000 car? Just my car, yeah. Okay, and how much do you guys make a year? So my husband makes about $120,000. Okay. Are you at home? Yes, I stay at home. We just had our four-month-old baby. Okay. Oh, congratulations. So fun. Thank you. And you guys just bought a

house. And so I'm curious what you said, the payment quadrupled. So how much do you guys pay? Yeah. So I include the taxes and insurance with the mortgage. So overall, it's $2,700 a month. And what's your take on pay per month? Do you guys? So after taxes, it's after taxes is about $6,340. Okay. And I calculate that by weeks. So I don't know if that's correct, but so in four weeks he makes that he gets paid once a week. Okay yeah on a weekly basis okay well when it comes to paying off this debt I mean I want you guys number one

cut up the cards get completely rid of every credit card that you have and with the car being $2,000 I mean you guys can I mean you can keep the car because you're going to be able to pay it off fairly quickly is my hope when you do the debt snowball. And so I feel like for a lot of men, especially husbands that are not on board, there's a couple of things.

One, they don't want to be nagged. And I feel like when it's the wife that's like super passionate, she's like, let's do it. Come on, come on. What are we doing? And there's like this nagging that occurs. So anytime you bring up Dave Ramsey or the idea of getting out of debt, he's like, oh, it feels like a cuss word to him. So bringing him in and telling him your why.

Like, why is it that you feel the burden? You feel the stress of this $26,000, $28,000 of debt. What is it? Like, are you losing sleep at night? Are you worried about the future of your kids? Are you worried that if something happens that you guys aren't going to be able to pay your bills next month? Is there a fear? What is it in you that's motivating you to change? So what would that answer be? I think the answer is just what would life be like if I didn't have to pay these

minimum payments every month? Yep. Like to have, to be in a place where I can just pay cash for everything and save. And like, I have so many things that I want to save for, but I have this debt in the way. Yeah. So that's more. It's like all the income that he's working for is going to debt payments and

it's not going to create a life that you guys love. It's going towards debt. Yeah, exactly. It's what it is. And you feel like you're just not getting ahead. Okay. So that's a good,

so I mean like that's your why. And so being able to communicate that to him is huge instead of just the idea of like, Oh, I just want to get out of debt. And so I find that. And then I find that husband, especially men, they want to see the progress. So even if you just get out a sheet of paper, you write down all of the debt and you show him, like make up your own little payment plan and say, okay, here's what we can put towards each debt. And we could be out of debt, completely out of debt. And you figure out the timeframe of you guys of what you're willing to sacrifice

and put towards this debt and show him, okay, in 18, 24, 23, whatever months, whatever the timeframe is, this is when we can be out. Can we sacrifice for this amount of time? And so having him on board is going to be crucial. It's very, very hard to win financially, almost impossible to win financially when you and your spouse are not working together as a team and you're running in two separate

directions. So getting him on board is so crucial, but showing him that progress and that it's not going to be this life of sacrifice forever because no one wants that. I mean, you're just like having sacrifice, sacrifice. Obviously that's not going to do any good. That would be crazy. So showing him the progress and what you can make and getting him on board. So I find that. Understanding the why and showing the progress usually helps with getting that spouse on board, but good luck.

All right, that puts this hour in the books. Thanks to producer James Childs and associate producer Kelly Daniel, and thank you, America, for listening. This is The Dave Ramsey Show. Hey, it's Blake Thompson, senior executive producer for the show. You know, you can listen or watch anywhere with the Dave Ramsey Show app on your smartphone. Catch the full show or watch the highlights and check out Dave's upcoming guests. Head to the App Store and download it today.