The Ramsey Show - App - We Paid Off a Ton of Debt… What Do We Do Now? (Hour 2)

Episode Date: November 23, 2022

Dave Ramsey & Kristina Ellis discuss: What to do after paying off debt, Investing while paying off student loans, Should I flip a car? How to attack $300k in debt. 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 studios, it's the Ramsey Show, where debt is dumb, cash is king, and the paid off home mortgage has taken the place of the BMW as the status symbol of choice. We help people build wealth, do work that they love, and create actual amazing relationships. Christina Ellis Ramsey, personality, number one best-selling author, is my co-host today as we take your questions at 888-825-5225.

Happy Thanksgiving, America! Take a step back and be thankful what are you thankful for my goodness we have so many things that we can't even count them all so one of your tickets are the ticket for you to get on the show today once you make it past laura who is screening phones today. Well, just because Austin didn't. I mean, that's how that works. And so if you get past her, your other ticket to get on the show is you have to tell us what you're thankful for. Well, that's cheesy, Dave. I know.

We run a cheese factory here. We're fine with that. Cheesy's good. I cry at Applebee's commercials. so it's okay to be cheesy. All right? Open phones at 888-825-5225. Michelle is in Green Bay starting off this hour. Michelle, what are you thankful for?

I'm thankful to God for the health and well-being and guidance of my family and friends. And as cheesy as it sounds, I'm thankful to Ramsey Solutions for putting out the information and guidance that they do because I'm in a very never-thought-I'd-be-here situation. Yay, touchdown. Hey, we like extra cheese on it. It's good. Thanks. Very good.

Right? Well played. Well played. Well played. So how can we help today? So we were introduced to FPU in 2014. I've coordinated about a dozen classes. Thank you. Through our local church.

My husband and I have paid off $165,000 since 2014. Oh, wow. That includes our house. Way to go, baby step sevener. I know, but like, so we're putting 15% into retirement. We have an ELP. We're saving to beef up our emergency fund. It's only at four months. We're going to make it six. It won't take us hardly any time at all. We're saving for a new car. And I just received a big bump in income while we were paying off debt. We were at about a hundred thousand. Now we're at about 140,000. Now what do we do? Now what do we do? Like we're so used to being intense and we have an end goal that we were always going for,

which was paying off the house. It's just now, what do we do? Yeah. Well, you do move after baby step three from intense to intentional, and you're just reaching a plateau that it feels like you arrived, and now I don't have a journey, and you do. I still have a journey. You've just got to plateau that it feels like you arrived, and now I don't have a journey. And you do. I still have a journey.

You've just got to define the journey now. It's a new journey. What's the next step? And so you always have to be intentional with your money, always. So you always need to be looking out a little bit and saying, this is what we're aiming at. And intentional is different than intense, though. Okay? I've been at the intentional stage different than intense though okay um i've been in i've been

at the intentional stage personally with sharon and i for many decades now we got way past the baby step seven stuff all that stuff a long long time ago and um so we've just been intentional and what we've learned to do is there are really only three things you can do with money. Give it, enjoy it, and invest it. And I would recommend that you systematically always, with a percentage or a dollar amount or whatever it is, you're always doing all three. And that means if your income increases, you're going to increase all three now what has happened to us is and you're going to be getting there someday is the percentage that i put towards

enjoyment lifestyle has had to get smaller and smaller because it was getting ridiculous because my income was getting so high you see what i'm saying i mean if you put five percent of a hundred thousand dollars towards lifestyle that I mean, if you put 5% of $100,000 towards lifestyle, that's one thing. If you put 5% of, you know, million whatever dollars, right, that starts to be cray cray. And so, you know, you just got to back down and go, there's only so much lobster you can eat, right? So, and so, but put a percentage for lifestyle, enjoying the money. And and that way when you're spending that there's no guilt it's like i bought a nice new car but it's a percentage of my and i've got this other percentage towards generosity and i've got this other percentage towards the

long-term play of investing changing my family tree and so on right um yeah and so so our giving percentage is way higher than our consumption percentage today. And yours will get there. It won't be yet, not at 140,000, even though you're 100% debt free, but you can kind of see the feel of it. And so then you start to go, okay, within giving with my percentages being this, it's going to be this much money. What are my goals? And I had talked to this guy that was really rich one time, and he told me about it. He gave away a million dollars in one year. And I thought, man, that would be really cool. And then I did it.

And then I thought, well, now what am I going to do? Okay, I want to give away a million dollars in one day. And I was able to do that last year.'s and so that was a kind of a cool day and um you know oh no it was a year before last matter of fact come think of it before you came before you came on board with the show and so but um yeah so i'm not bragging i'm just saying you gotta have a goal you have something you're aiming at with your generosity have something with your with your net with with your investing it's i want to hit some net worth goals i want to hit this and hit that and hit that but having something that you're aiming at gives it some meaning and gives some power to your

intentionality yeah hey michelle how do you feel about your change in circumstances um it's it like honestly i want to ticker tape parade and I want balloons and I want to party but but it's an odd feeling because we have been so intense for so long even our ELP has said that we need to give ourselves a raise because it's it's almost like we don't know how to let off now. That's normal. And it's just, oh, good. Well, I mean, when you do something really, really intense and you come off the sports field, athletic field,

it takes two hours for your adrenaline dump. Right. I mean, like when Christina and i are doing stuff on stage we get hyped up we're excited you know we got 5 000 people 2 000 people out there or whatever on stage and we're jacked up and we you know we cannot go back to the hotel and go to sleep there's no chance okay so we all get together somewhere the whole live events team and we'll all just sit around joke and cut up and and stay up too late because we're gonna be up anyway i mean it just takes a little while for the adrenaline dump,

and that's where you are. You're coming off the athletic field after the big game, and there's an adrenaline dump. Yeah, it does. That's normal. That's normal. It's wonderful. It's wonderful, and I encourage you, too, to have that celebratory

whatever it is for you guys. I know you want the parade and the balloons, but what is that for you? Maybe you do balloons and a parade in your own house. Something that you can symbolically say, this is a huge achievement, and now we're on to the next season. I think you ought to go on one of those super, super expensive cruises and have them fill the

entire room with balloons before you get there. I like the way you think. That's what you ought to do. You've got to celebrate it. I mean, you've got the money, and you're not doing anything wrong. You've done a great job. I'm proud of there. You got to celebrate it. I mean, you got the money and you're not doing anything wrong. You've done a great job. I'm proud of you. someone did not notify my marketing department that prices are going up because apparently for black friday we have the lowest prices we've ever had i'm so confused but okay it's great deals for you folk.

Our number one bestseller, the Total Money Makeover. The audio book right now for Black Friday, $7. Plug that in, listen to it on your next trip, your trip when you're going over the river and through the woods to grandmother's house we go, right? You can just plug the audio book in. And that's the way I consume them. I listen to them on

my walks i listen to them like i listen to podcasts so yeah the new millionaire bundle comes with a total money makeover baby steps millionaires and the know yourself money assessment all for 25 whoa that's a deal and if you're looking for something a little prettier than books the rachel cruz wallet is here in, handcrafted from genuine leather. Looks really good. I don't know if they got any of the red ones left. The red ones may have gone already. So check those out.

But the Rachel Cruz wallet, a very popular Christmas gift. It really is. Black Friday deals, everything. All the books are $10, even my latest number one. We've cut everything down. It's just Deloney was griping about it the other day because he's like, he doesn't get as much royalty when the price is down, right? And he's like, you guys are cutting the prices too much.

Well, that's the way it is, Deloney. All right, RamseySolutions.com. Welcome to my world. RamseySolutions.com. Hit the store. Get the Black Friday deals. Our question of the day comes from Blinds.com. Find out for yourself why Blinds.com is the number one online retailer of custom window coverings

with free samples, free shipping, new promos they run all the time. You'll save even more. Use the promo code Ramsey and you'll get the best deal. Today's question comes from Brittany in Idaho. My company matches 50% up to 6%. I'm currently contributing 5%. Once I reach the 6% match, should I open a Roth or get up to 15% then open a Roth? Or do I stop until I pay off my student loans? I'm 36 with no kids,

but engaged and hoping to have children. It's a great question. And I think a lot of people get confused. They get so excited by the match that they just start diving into investing. But if you're still paying off your student loans, you're in baby step two. So we would tell you to hold off on investing and focus that money on paying off the debt. The key is it's a temporary pause. You're not going to be doing this for long. You're knocking student loans out really, really fast because you completely focus on them. So when we say stop investing, the key word is temporarily. Push pause on investing so you can completely focus. That's a big deal. Yeah. And it feels a little counterintuitive at times because the match, a lot of people are like, but I'm giving up free money. It is counterintuitive. It's actually, the math on it's actually wrong. It is i mean you're giving up a two-for-one match i mean

a hundred dollars turns into two hundred dollars meanwhile you're just paying off a stupid sally may it's wrong but what is right is over the scope of your life your most powerful wealth building tool is your income and when you get that back you can build wealth instead of trying to trick something with the math so this is also about behavior. It's not just about math. Cleaning the deck on all the debts, it doesn't feel right. It's not fun. It's not, you know, unless you're around here, you don't get a touchdown.

You know, around here, we give you a touchdown. Debt-free scream, confetti, all this stuff. But everywhere else, everybody's looking at you like you lost your mind. But when you clear the decks, you can breathe. Your shoulders drop. Your stress level goes down. Your relationships go up. Your career kicks into gear.

All of these things happen. None of that happens with a match. Yep. And that's the key is I think so many people get focused on the math. But so much about winning with money is about behavior change. It's not super glamorous. It's not super glamorous. It's not super exciting in the beginning, but it's so that you can get to a really awesome spot in the long run.

Yep, that's how it works, and that's why you've got to do this stuff. You've got to do it. You've got to do it. You've got to do it. So, absolutely. So, now, once you're debt-free with student loans and we start investing, then the rule of thumb is match first, Roth second. Well, you kind of got that down, sounds like, Brittany.

But here's the thing. You can do, if your 401K is a 401K Roth, you can do 401K Roth up to the match and get the Roth. Now, the match portion is not Roth, but the rest of it's Roth, and that's what we would tell you to do. So, Roth, match beats Roth beats traditional. So, you always get all the match first, and then you do, if you only have traditional at the office, then do traditional up to the match,

then go outside and do an individual Roth. And then if you have to do more to get to 15%, go back and just do traditional. But match beats Roth beats traditional. And always do any Roth anytime you can. I mean, there's very few exceptions on that. So just, just do all the Roth all the time, all the can, all you can. And, uh, whether it's at your work or whether it's with the individual. So good, good stuff.

Charles is with us in Winston Salem, North Carolina. Hi, Charles. Welcome to the Ramsey show. Hi, Dave. Happy Thanksgiving. Ramsey Show. Hi, Dave. Happy Thanksgiving. You too, sir. What are you thankful for? Well, actually, I am thankful for my girlfriend.

She's always stood beside me, you know, supporting my decisions, being something that was boneheaded, and she's actually helped me get out of debt. Awesome. Very cool. How can we help today? Well, a while back, I ordered a new 2022 Ford Maverick. I needed new vehicles. One I have now that I have a lot of problems with.

And she was kind of against it. So I'm thinking maybe I better not get it. But then just curiosity, I put in Carvana to see what they offer me for it. They offered me $7,000 more than what I paid for it. So I'm thinking, get the car, sell to Carvana or another dealership, and use that money I make to buy a beater car, something more reliable to drive for right now. I realize I may have paid a little taxes on the money,

but still, it might be worth it to do that. So you don't have that car right now. This is like you would go out and buy the car to sell it. Yeah, it's, yeah, basically the Maverick's a very hot car right now. Everybody wants what dealers are selling over MSRP. But this dealer is actually selling for under MSRP because they wanted to build their allotments up. So I'm going to use that money. You're borrowing the money to buy this car?

Yeah, I did put a small down payment on it, and I got like a 1.9% interest rate on it. Do you have the money to pay cash when the car comes in? Do I? Yeah, but they see white me out. Yeah, but I thought you were going to sell it the next day. Yeah, but I have to wait. It's only two weeks because I'm buying it from out of state.

So they have to send me the paperwork because of the title differences from where I'm buying it to here to North Carolina, that's all. Then I would be able to sell it. But I'd probably spend the sale by Christmas or right after. See, I don't trust you. Okay. I think you're going to keep the car. I don't want to. I think you're going to keep the car I don't want I think you're going to get the car and you're going to drive

it home and you're going I can't sell it it's awesome she'd kill me if I kept it I'll kill you if you keep it but as far as I mean as far as that's going, yeah, I do sell it. Do you think that's a logical thing to do? Only if you pay cash for it.

Only if I pay cash for it. Because what that will do is it will make you sell it. Okay. Because you get, your stomach just got all upset when I suggested you pay cash for it, and you're going to want to get rid of that indigestion, and you're going to get rid of the car to get rid of that indigestion. Gotcha. If you finance this, you're going to keep it.

Here's where I'm going, all right? I'm a car guy. I get it. That is a sweet car, by the way. It is. It is. It's freaking lights out, mic drop. It's a sweet vehicle.

Now, I mean, I just, and I like stuff that goes budden budden. I just, I love things with, you know, that thing will rock, too. It's, what is this stupid thing? 500 horse, isn't it? What, the Maverick? Yeah, what's the horsepower? No, it's 250. It's only 250.

Really? It's a 2.0. It's EcoBoost. It's not the hybrid. It's the EcoBoost. 250 horsepower. That's awful. Okay.

I thought it had some go. All right. That makes it worse. That's like a bad chevette or something um it's not it's not a trans am i thought it was a go-go i misunderstood okay anyway aside from that i was just that's just me talking with cars but okay um here's the thing um the reason i'm accusing you of all of that is it's exactly what i would have done in an earlier version of me yeah and i'm what I would have done in an earlier version of me.

Yeah. And I'm trying to keep you from being an earlier version of me because he was pretty stupid. I used to be bad with cars. What I had to figure out is, and here's a good rule for everybody out there. I had to put things in position to protect me from doing stupid. And when you buy this thing on payments there's a high likelihood you're going to keep it but if you got the indigestion because you used your last dime to close on it and you gotta flip it to put your money back in your account because you're freaking

out because you're broke that's going to force you to do smart and i'm trying to set up systems here that force me to do smart make me highly uncomfortable if I'm being stupid. And that's what I have to do. I put automatic everything in. No stupid, full smart on automatic. And it wouldn't hurt anything at all if you just walk away from the deal, by the way. Wouldn't hurt a thing. This is The Ramsey Personality, number one bestselling author, is my co-host today in the lobby of Ramsey Solutions on the Dead Free Stage. Matt and Christina are with us. Welcome, guys. Welcome, welcome. How are you?

Hi, Uncle Dave. Thanks for being here. Where do you guys live? Where do y'all live? We're about 40 minutes east of Columbus, Ohio. Oh, fun. That's a nice area. Welcome to Nashville. How much did you pay off? So, $265,000 and 11 years whoa good for you and your range of income over that decade um so baby step two we were in the 80 80,000 range um and then we went on during four five and six we're in the 140 180 range and i just got a bump so so about 218, 220 now. Wow, good for you guys. Well done.

And what do you do for a living? I'm a nurse practitioner. And I work in electronic fraud for a bank. Yeah, good for you guys. So 456, that means this 265 included the house, your debt-free house, and everything. It did, yes. Woo-hoo! Look at that weird people!

That's right. How old are you two weirdos? 38. All right, man. And a paid four house. What's the house worth? Well, now probably about $300, $330, $350, somewhere in there. Cool.

Probably, yeah. How much in your 401ks and retirement plans? Total, what, net worth is about $283. I'm sorry, $683. $683. Yep. Good. You're almost a millionaire. With the house and the 401k. Yeah, you're going to be there before you know it. Now, you, 683. 683. Okay. Yeah. Good. You're almost a millionaire.

Well done. Yeah, you're going to be there before you know it. Now, you're how old again? 38. 38. So, yeah, 41, you're going to be millionaires. Yeah. Very good.

Good for you guys. Excellent. Well done. Well done. So, what other kind of debt was it other than the house? So, do you want to talk at all? You want me to do it? Maybe step two, we sold a motorcycle

we sold or not sold well we we paid it off then sold it um and then her she had a suv at the time and then about 40 ish and student loans okay between the both of us and you know her master's degree we we funded that cash and she's really smart so we had uh she got a lot of scholarships um when we were after baby step two we pay for two cars cash i'm just bringing all this up for that person that's you know what i mean they get in a four five and six just you can do it so that's when we were writing our stuff down that's you know something that we had two kids over there that you know no bills followed us home the bill came we paid it off cash so so you guys were were normal you know, no bills followed us home. The bill came, we paid it off cash. So, so you guys were, were normal, you know, you started out normal, had different debts,

and then you obviously got on fire on this journey. What did this look like for you? I would say that originally, you know, we were very normal. We were a young married couple. And honestly, the fights that we were having were money fights. Um, and honestly, we felt like we had really good jobs, but at the end of the day, we never seemed like we had enough. You know, we'd get the paycheck and then it would be gone. So our church offered Financial Peace University and we took Financial Peace. And I would say after probably maybe the third class, we were kind of like, yeah, we can do this. And then by the end of it, we're like, we're going to do this. Like, we can pay off the SUV. We're like, yeah, it's not just the SUV, it's the student loans.

And then it's like, okay, we're on this and let's just keep going. I think that, you know, we're proof that the system works. You know, following the baby steps definitely works. And I think, you know, being gazelle intense for, you know, that first, you know, 30 months, you know, it's hard. But then the key now is just consistency. After that, it's just sticking with the plan, sticking with what you know. And then you end up being able to live and give like nobody else. Yeah. Well, your numbers fit all the case studies of the millions of people that we've talked to.

I mean, exactly. The average millionaire and the millionaire and the baby steps millionaires research project that we did pays off their house in 11.2 years. You did 11 years. You know, they become millionaires within 12 to 17 years, and you're on track to do that easily. They do it by 52 years old. You're not going to be anywhere near that because you started younger on this. You worked your debt snowball, not counting the house, probably in less than three years. And that also fits the guy.

I mean, you just walked down the process. I mean, you worked down the system exactly the way we talk about. Way to go, y'all. Thank you. Thank you. You've got to feel accomplished. It's surreal because we went to the old place 30 months on Baby Step 2. We were at the old place, you know, what, nine years ago?

Yeah, 2013, December 2013. We actually did our debt-free scream at that point in time. We're like, we've got to go back. Now we're Baby Step 7. We're going back. Do it again. Yeah, do it again. Yeah, this is good.

A two-stage debt-free scream. That's right. Yes, a two-stage debt-free scream. The's right. Yes. I like it. I like it. A two-stage debt-free screen. The other one is the old place, for those of you, is an old office before we built this building about three years ago. So they were at the old place, yeah. And it was not as nice as this one. This one's nice.

It's beautiful. Well, you know. You got to come see this place, people. It's beautiful. Yeah, come see it. It's fun. Thank you. So 11 years, that's a long time to stay committed.

A lot of people hear 11 years and they're like, I don't know if I could do that. You know, what was the hardest part of that journey for you guys? I think we talked about consistency. Like when we started, we saw our tithing. It was like embarrassing to even talk about consistent tithing. And then things just, you know, fall into place. When we finished off, I always tell the story, we finished off baby step two. We always, we'd go out black Friday. Cause it's coming up. We'd, we'd buy pillows on black

Friday. We sat there for like 30 minutes, picking out pillows. We get to the front and we get, it was free. We're like, we don't need that. You know, it was like $70 worth of product at a department store. And we got it for free and was like, like, we got that back. I don't, it's just, I share that with people that if you, as long as you keep giving, keep consistent, it's going to, you know, it works. So do it. Consistency over time. I also think just remembering your why, you know, I think for us, we wanted to change our family tree and be able to leave a legacy. And I'm also someone who wanted to be able to give, you know, and like he had said, you know, prior to able to give, you know, and like he had said,

you know, prior to starting Financial Peace, you know, we weren't doing wise things with our money. You know, we weren't able to live and to give like we wanted to. And so this, you know, the program definitely taught us those principles. And now we've been able to be living proof of that. Yeah, you guys are fun. Well done. So proud of you. Thank you. Thank you. I mean, you're 38 years old and everything's paid for. Wow. How's that feel?

It's still sinking in, I guess. It's very nice when you drive into your house and you're like, this is mine. I walked through the house yesterday. I was like, this carpet looks nice. You know, it's ours. It just, it feels different. Yeah, it does. It changes everything.

People don't grasp the concept because it's as much spiritual and emotional as it is mathematical. And until you're standing on that carpet and it's paid for by God, you know, it changes everything. It's like, man, yeah, it's a different level of boldness in your life, of compassion, everything. It just gets a little brighter out there. It's pretty cool. The shades are off. Well done, you guys. Very, very well done.

Sharp young couple, man. Heroes. Well done, guys. All right. You took control of your life. We got the Live and Give bundle for you for you to give away. The Total Money Makeover book, which obviously is a core piece, and you'll be able to give that to somebody.

Financial Peace University membership, you'll be able to give that to somebody. You guys have been through the class, coordinated the class. Thank you for all of that. Very cool. And the Baby Steps Millionaires book, because that's their next chapter in your story for sure. So you just keep on rocking, guys. Keep on rocking. I love it.

Let's bring the kiddos up. What are their names and ages? We have Kenzie, who is seven, and Luke, who is three. All right. Dead free kiddos. Do they know what's going on? They do. We practiced the whole way down here.

They've been practicing for months probably. Okay. And they know what this means. Their mom and dad are heroes. They changed their lives. Well done, you guys. Very, very well done. Matt and Christina from Ohio.

$265,000 paid off house and everything, 11 years. Did it make an 80 all the way up to now 218. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! We're debt-free! Yeah! You know, little Luke is old enough to remember that time his weirdo parents drove all the way to Tennessee to that strange radio show and did their debt-free scream.

That time they paid off their house. That time that they never borrowed any money again, that time that their whole lives were changed. He's old enough to remember his mom and dad being heroes. That's powerful. I mean, that's the sound of a... You guys, if you listen, go back and listen to that again. If you listen to it on podcast, rewind and listen to it.

You just heard the sound of a family tree changing right in front of you this is the ramsey show so Christina Ellis, Ramsey Personality, number one best-selling author, is my co-host today. Sharnice is with us in New York City. Hi, Sharnice. How are you? Hi, how are you? Better than I deserve. How can we help?

Happy holidays, by the way. Happy Thanksgiving. So what are you thankful for? I am actually thankful for a lot, but family, friends. I just recently moved to a co-op, so I'm happy about that and my career. Good for you. Cool. How can we help today? Yeah, so I live, of course, in New York City. I'm 34 years old. I'm a social worker, and I have a son who's six years old. Right now, I only have one stream of income, and I have roughly around $300,000 worth of debt.

This is also including student loans, credit cards, et cetera. And I'm trying to prioritize what to focus on first. It's bringing on a lot of anxiety. I do make about 60, I believe 65. I got a raise today, actually. And so I'm just trying to figure out how I can be debt free in a short amount of time, take care of, you know, my son, have some savings. I can't save for anything and just live comfortably. That's the biggest thing for me.

I did file for bankruptcy in 2018 and I was fine until I recently moved this year. And the credit card debt stacked up because of the move, and I had some medical issues. So, you know, this year has been really tough, and now I'm struggling, kind of. Well, we're glad you called. That's first step. I feel like the way you're describing that, you've had your I've had it moment. Is that right?

Yeah, definitely. You're done with this debt. You're ready for something new. Totally. I just want to live comfortable. I want my son to have his savings. Where did you move from? Well, I'm actually from New York City,

but I moved from a studio apartment to a two-bedroom co-op building. So you're broken deeply in debt and you increased your rent? Yes, I did. But we needed the space. But you're broken deeply in debt and you can't breathe. Yeah. Oh, and you ran up credit card debt to do that, too. As of this summer, yes.

Mm-hmm. It went up. Yep. Hmm. Okay, let's back out for a second. I can help you, all right, but this is a math problem at its core. And there's two pieces of information here. There's your income and there's your debt load.

And around here we call that the shovel and the hole. You have a very large hole and a medium-sized to small shovel. Agreed? Agreed. Thus the anxiety. Thus the stress. The overwhelming feeling. shovel. Agreed? Agreed. Thus the anxiety. Thus the stress. The overwhelming feeling.

The sense of hopelessness. The sense I'm going to be stuck here forever. I can't breathe. I don't see a way out. I've been there. I know how it feels. Okay? So you have a pretty radical situation.

A very difficult situation that you find yourself in with the math would you agree with that too yes definitely the sad news is and um we love you enough to tell you the truth kiddo uh the sad news is radical difficult situations require radical difficult solutions and the only way to get out of this highly toxic math is to do some bizarre things that are going to be very uncomfortable in the short term. You don't get an option. There's no option on the table where you get to do three things, make $65,000 a year, have a wonderful life, and live in Manhattan. These three things, and get rid of $300,000 worth of debt. These things don't work in the same puzzle.

They don't fit together. Okay? So something's going to give. Something's going to give. You're going to give up the cool, cozy, wonderful life. You're going to do some crazy things to increase your income. You're not going to live in Manhattan. I don't know, but you can't do what you're doing right now.

It's not going to work in the next two decades. You're still going to be in debt because I can back this out and just tell you, if you had zero debt living in Manhattan with a child as a single mom on $65,000 is no picnic. If you had zero debt, that's no picnic. Agreed? Agreed. And you got $300,000 sitting on top of your head. And it ain't going away unless you make it go away so i i wish i didn't um so i think you're going to

pick your pain or it's going to pick you um you're going to pick your pain you're going to say all right we are going to live in a different situation for a short period of time and it's going to be very uncomfortable for me and my child and the hours i'm going to work are going to be freaking ridiculous so that we can have a great life later we're going to live like no one else so that later we can live and give like no one else or you're going to choose to stay exactly where you are and this stuff's going to come crashing down on you because this math does not work it's not sustainable you can't you can't pay for a co-op in Manhattan on $65,000 and service $300,000. You can't even pay the payments and eat.

Well, so the maintenance fee, so I do live in the Bronx. The borough is the Bronx, and I had to got a loan because it was $33,000. So it's like pretty much it helps middle income individuals with a co-op. And so I put a little bit down and I'm paying it off slowly. I think I have like seven years to pay off the loan that they gave me. And then of course I have my car note, credit card debt, and student loans, private student loans as well. You bought the co-op? Yes, so I bought the co-op. And you have a seven-year loan on it?

Yeah, well, I can pay it off at any time, but I put a down payment on it. It's like a program that helps you pretty much. Are you telling me you're going to have the co-op paid off in seven years? They add on the extra from the loan to the maintenance fee, yeah. Yeah, but I mean, what happens at the end of seven years? You've got to go get a mortgage, right? It is pretty much a mortgage. I am a homeowner for that co-op.

And you have it on a seven-year payout in the Bronx. I calculated it, and I believe that's how long it's going to take me to pay off that loan that they gave me to cover the other half that I owe. So what was the price? Altogether, that co-op apartment was $33,750. That was the price to buy a co-op in the Bronx? Yes. I am so confused. I would have said $3.3 million.

Yeah. How did you get it for $33,000? Are you sure? Yeah, so it's pretty much, like I said, it's a program in new york city that helps the middle uh income uh individuals and they pretty much um assist so you have to come up with the whole you have to come up with the whole amount and if you can't come up with the whole amount uh then you can go on a payment plan and then they'll add it to your maintenance fee it's called

a maintenance fee okay this is the most heavenly program i've ever heard of where you can buy a co-op in the bronx for 33 000 bucks my mind is blown okay i had no idea that this is even possible or existed i am still in shock and awe so anyway i guess i'll set that aside if you got that deal i'll let it rest i have never heard of that and it's mind-blowing and it has nothing to do with real estate values in the area nothing to do with that whatsoever you can't buy that in anywhere in america much less the freaking a borough of new york one of the 18 boroughs in new york city not a chance okay so all right i'll let that rest we still have the three hundred thousand dollars in debt well and i still have a problem and i'm worried you know when you first

picked up there's a lot of remorse in your voice. There's a lot of angst. So I thought you had the I had it moment. And I'm a little worried that the bleeding's still going. Like, have you cut up your credit cards yet? No, no. Should we move into this? I mean, $300,000, that's a terrifying amount on that income.

Okay. So, Sharnice, I don't want us to run out of time. Here's what I'm going to do. I'm going to put you on hold. Laura's going to pick up. We're going to put you through Financial Peace University as our guest because I don't want us to run out of time. Here's what I'm going to do. I'm going to put you on hold. Laura's going to pick up. We're going to put you through Financial Peace University as our guest because I don't know how to help you on this call today. There's too much going on here.

But you have a problem, and the problem is you don't make enough to pay this debt off in a reasonable period of time. So something's got to give on the income side of the equation. It may mean you live in an entirely different area of the nation unless you bought a condo and a co-op for 30 wow that's amazing okay cool hey good good hour yeah thanks for hanging out happy thanksgiving everybody this is the ramsey show dave here you can find all of our shows with the Ramsey Network app on your smartphone. It's the only place to listen to the entire back catalog of episodes.

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