The Ramsey Show - App - What Do We Do With My Dying Father's Assets? (Hour 3)

Episode Date: November 12, 2020

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave 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. I'm Dave Ramsey, your host. Anthony O'Neill, Ramsey personality, number one best-selling author, is my co-host today here on the show. The phone number is 888-825-5225. That's 888-825-5225.

Gavin is with us in Yukon, Oklahoma. Hi, Gavin, how are you? I'm good, how are you? Better than I deserve. How can we help you? So, a little bit of backstory. I'm 18. My girlfriend is 17. She's a senior in high school this year, and I just graduated. She wants to go to college and major in art history, but she's told me that she doesn't think that there's much job opportunity there. She just wants to go and learn some more.

And so I guess what my question is, is at what point is it my time to say something or my time to say something? And then what do I say so I don't come off like I'm not caring or I'm not understanding for the situation? Oh, man, that's a real good question. How long have you all been dating? Almost a year.

Okay. Okay. All right, all right, all right. Now, let me ask you this question. What would you say? Like, what, what do you want to say?

You know, I'm a little harsh on per Dave. So what do you want to say? If you're harsh per Dave, that's really bad. So, but what would you say? Uh,

if you could say anything you wanted to say and he didn't worry about her feelings for a second, what would you say? Yeah, I would say that you need to think harder about this. Because you have some money saved up, and you could get through it without putting on student loans or anything, but is it really worth spending $80,000 to go to a four-year school to get a major in something you can't get a job in? Okay, cool.

And here's what I would suggest since you are you guys are in a relationship um i want you to step back and see if you can help her find out something else that she's good at you know because if she's saying that there's no job atmosphere there's no job opportunities in this field maybe you can help her identify something else that she's good at that there are some job opportunities so rather coming at her that would say well you know babe what about this you know you're really good at communicating you're really good at that. There are some job opportunities. So rather coming at her, that would say, well, you know, babe, what about this? You know, you're really good at communicating. You're really good at listening. You ever thought about this opportunity?

If you do this, it can honestly cost you a little bit cheaper over here. And you could do this. Going to more. Is it art or is it history? So she wants to go into art history. I know. I heard that. Which one is it that she likes the most?

She says that she can appreciate art and she likes how it's developed over time. So it's kind of both. Okay. So I'm just trying to figure out, is she a history major that needs to teach history in high school, or is she a graphic artist? Yeah, I think that she would, if it had to be one of those two options, it would be definitely on the side of history teacher. She doesn't want to make art.

She just likes to appreciate it and likes how it's developed over time. Okay. Well, here's a good rule in general. The extent that you can influence someone is 100% directly correlated with the depth of relationship you have with them. So a casual relationship, you really can't influence someone. Okay? The UPS driver that drops stuff off at my house, his name's George. He's a great guy.

I talk to him. I say, hey, George. He says, hey, Dave. But I don't really get I talk to him. I say, hey, George. He says, hey, Dave. But I don't really get to talk to him about what he's studying in college. I don't have any relationship. That's way on the outer rings of relationships. All the way in the inner ring would be my wife, right? And so then my grown kids and then people that are good, close friends that love me

and can speak to me about things and i can speak to them about things that they need to change or look at but outside that people don't really listen to other people it just it just pisses them off that you get involved in their business yeah and so don't you know don't be an internet troll with your girlfriend is my point so you know make sure that you are you are, that your relationship is deep enough that, let's just change the relationship for a second. Let's say this was a guy that you have grown up with since you were eight years old. You played baseball or football with him.

You've hung out. Your dad's took you camping together. You are best buddies all the way through high school and he's getting ready to make a dumb decision well you just put your arm around him and kick his little butt wouldn't you right yeah but you've got the depth of relationship to pull that off in that scenario that i just laid out and um so you've got to tread lightly because you're about to test when you start this conversation how deep this relationship is. Yeah.

And know when to stop, you know. And then once you test it, if you see that's okay, I crossed my boundaries, back up. And don't bring it up again until the relationship warrants that you can bring it back up in a safe place. Yeah. They've got to know that this is not about you. Yeah. it back up in a safe place yeah they've got to know that this is not about you yeah and that you actually do know them and you're thinking of their best interest which is what you're doing it sounds like but translating that to her and then becoming persuasive in the argument is is based on

the depth of the relationship so um this idea that um you know well you ought to be accountable to so-and-so i'm not accountable to you i never met you i can't kiss my butt i'm not accountable to you you know you know some guy that has 35 people in his church is pissed off at me because i don't use the king james version in fpu or something you know so you know i'm not accountable to you dude i don't have a relationship with you but my one of my best buddies that i've, you know, read the Bible with and studied with and learned with or my pastor for 20 years or 10 years, yeah, they see something in my life, I'm accountable to them. They've got, and that's the same thing. It's the depth of the relationship in order to have an impact and change the direction of some kind of behavior.

But you cannot do that with people that you that don't trust that you know that they know you that you know them and don't trust your intent yeah it's a big deal jackson is with us jackson's in jackson mississippi oddly enough what's up how are you hey hey how are you dave great can we help? So my wife and I are both teachers, and we're in Baby Step 2. And I am making a career switch. And this year will be my last year teaching. It will be my fifth year. And I was wondering if whenever I finish this year, if I could pull out,

I'll have $19,000 in my state retirement, and I have about $42,000 left of student loan debt to pay off. And you've only said, you know, don't pull out of retirement to pay debt, but this is kind of a different scenario. Why is it different? I don't know if I should pull that out. Well, I guess the reason is I thought it would be different because I guess I could move the money over into an IRA.

Maybe that would be the better decision. Yeah. You're going to pay a penalty. Yeah, a 10% penalty. A 10% penalty, plus you're going to pay your taxes on it. So it's like saying I want to borrow money at 30% interest to pay off my debt. Yeah. Makes sense.

I guess I'm just so eager to get out of debt, I thought it would make it a little faster. Yeah, I appreciate that. And that's who always asks this question is somebody who's game on. Yeah. Somebody who's got gazelle intensity. So you've got all the special sauce, Jackson. I'm just not going to give up a third of my money to the government. Right on point, Dave.

Yeah. Keep the eager. Go after it. Keep your money, though. Yeah. This is the. Go after it. Keep your money, though. Yeah. This is the Dave Ramsey Show. I get the privilege every day to talk to smart, creative entrepreneurs doing great things for our economy. GRIP6 is no exception. BJ and the great team at GRIP6 know how to truly create smart products that are unique and makes everyone's life a little easier.

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is my co-host today on the Dave Ramsey Show. Tom is in Spokane, Washington. Hey, Tom, how are you? Good, and you? You're breaking up with your phone. Try again, sir. So good, Dave. How are you guys? Good, good. how can we help so my dad um he's dying from a large brain tumor last august they gave him a couple weeks to live oh my gosh so he's already

surpassed well further than they said but we ran into a few problems yeah Yeah. Well, like I said, he's made it way longer than we thought. So he has a house. He has about 15 cars. He has a small retirement account with like five grand in there. My question is, my sister is the power of attorney, but we're reading that goes away when he dies. So what happens to all that when he dies? There's no will? So he has a will. We can't really talk to him very well. We don't know if everything is in there. Have you read the will? No, I have not.

Where is it? I know it was done very quickly, and because we thought it was going to pass very quickly. Who did the will? My sister, my oldest sister. Well, get it from her. Y'all sit down and look at it. That's where the stuff's going, whatever that says. And it may have some broad strokes in it,

like all of my known worldly goods are dispersed this way, which covers everything, right? It usually won't. Some wills will list out, if you've got a very detailed estate plan, will list out every single item. But the will is the guiding document. It's going to dictate what happens. So let's say worst case scenario, well, let's say none of the cars are on there or none of his retirement accounts are on there.

What would happen to those? A judge would decide in probate court with an attorney, which means the will is a piece of crap. Okay. probate court with an attorney okay which means the will is a piece of crap okay they may not be listed on there but i'm getting i'll almost i mean i'll give you a 90 probability that with some broad language the will addresses all of his assets okay it's very you know he wants even the template will a basic will that you buy at freaking office max that's a piece of crap does that. Okay? And so unless your sister typed this up,

it probably addresses with some kind of catch-all language for the other stuff. I'm not an attorney. I've just dealt with this like a thousand times. Right. She's the power of attorney right now. Yeah. But we're reading when he passes that goes away. Yeah, get the will and look at it everybody sit down look at it now before he passes and let's just have a discussion about it so that we're all on the same page and we go okay that's what this thing says because i'm thinking

it probably does not address every item that he owns like like your suspicion, okay? Right. But I think it does have some catch-all language that just says, and the rest of my assets other than these that are listed, or anything not listed here that I do own falls under this, or whatever. It'll have something that is like the umbrella catch-all for the other items. Now, the retirement account may have a beneficiary on it, and that would pass outside the will it usually does as a matter of fact like a 401k yeah it'll have a beneficiary on it like a life insurance policy does and it'll just go directly to that person if the beneficiary is

the estate then the will will determine what happens to it. But otherwise, it'll go, if you're the beneficiary on the 401k, it's going to go to you outside, regardless of what the will says. Okay. My last question is taxes on his house and his cars and everything. I imagine we'll all get, I mean, it's not much, $15,000, $20,000 maybe. Anything we need to know about that income? Shouldn't be any taxes on any of it except possibly the retirement account may have some income tax on whoever it goes to. An inherited IRA does have taxes on it, but inherited money does not. Inherited houses and cars do not.

Okay, Dave, thank you so much. Tom, I'm sorry you guys are facing this how old is he oh he's young he's 48 oh my lord okay well i tell you man from having walked through this a bunch of times you you you know you deal with the emotions you deal with the spiritual aspects of something like this and salvation issues and you also deal with the practical things which is what you're calling about today the um and it does actually help you with the sadness and with the process you guys are going through as a family if you can all sit down and talk about something like you're asking me and get the wheel out together and look at it and be on the same page because the lack of harmony among siblings over something silly like what happens to a car

is not worth it when your dad's passing and so i would sit down with the gang and just have a little family meeting very gentle very kind and say okay let's look at what this says and it's going to be good for all of us in ahead of time. If we're in agreement on this, they have a learning opportunity, even for myself here. Um, cause I have a will, but also have inside my will power of attorney. I didn't know that when a person, an individual dies, a power attorney goes away as well.

Wouldn't the power attorney go over? No, it doesn't. It doesn't. Power attorney, uh, because because you the power of attorney says that again i'm acting like a lawyer i'm not one but your answer is um that that let's say you're the power of attorney for me okay when i'm gone you you you signing my name on my behalf which is what power of attorney is doesn't work okay legally that that entity is not there anymore okay and so you can't have a power of attorney on something that doesn't exist anymore from a legal standpoint. Spiritual standpoint, obviously, still exists, all that. That's not what I'm talking about.

But the power of attorney ends at death, and then the executor of the estate starts to be in charge of executing, thus the name executor. They execute the terms of the will. And, you know, we throw around will like it's a document. It is a document. Right. But, you know, they always start out almost always with the same kind of little phrase. It's like, what is my will? Yeah.

It's my will and my last statement, my last will and testament, my personal will that Anthony gets this car and that Rachel gets this car and that rachel gets this thing and that winston gets that thing okay that's my i i want that to happen that is my will that's where the name comes from that's what a will is it's it's your will it's what you will to happen upon your death and your testament is that you're testifying to that and so we should be updating that at least once a year minimum or as often as we need to add things to the will. A major life change.

Yes. If you move, you've got to update a will because all will law is, all probate law is state law. It's not federal law. And so Louisiana has way different laws than Tennessee. California, Florida, way different laws. California is like another country. We all knew that.

But the, you know, way different probate laws. And so you need to, if you move, the state that you reside in at the time of your death, if you have a will from Oklahoma and you're living in Illinois, you probably have a will that's got some problems. Okay? Very likely. So if you move, number one, then if major life things happen, you probably have a will that's got some problems. Okay? Very likely. So if you move, number one, then if major life things happen, you have babies, babies turn 18 and leave, you're married, you're divorced, someone else dies, and, you know,

it affects your, what you, you know, the person you're going to give the stuff to dies. Yeah. You know, anytime there's a major life change, demographic change meaning marriage babies divorces all those deaths all those kinds of things in your life or you move you've got to update it now we update ours in detail because i've got it's a massive freaking document once a year and we have a meeting with the family and the leaders of the company and and we go through exactly what's going to happen if dave dies this year it's we call it thety Python meeting. I'm feeling much better. But, yeah.

And so, but, you know, we're so freaking detailed about it. Because if you're not, the government will end up with it. And if you're not, the family will end up fighting. Wow. Because they'll say, well, Dad told me this one thing. Well, yeah. No, everybody knows what Dad thinks because Dad covers it in detail once a year. And then you update that puppy.

So if you don't have a complicated state, you still need to have a reading of the will while you're alive with the parties involved. You don't need a movie scene with the bombshell trophy wife and the idiot son, you know, that looks like a classic movie scene, right? And they're going to fight in the lawyer's office with a walnut line paneling, and they find out what's really happened, what the old man was thinking. No, you do all that stuff while your butt's alive. Yes.

This is the Dave Ramsey personality, number one bestselling author, Anthony O'Neill. He's doing a deal. So phone number here is 888-825-5225. On the debt-free stage right here in Ramsey Solutions Lobby, Max and Carla are with us. Hey, guys, how are you? Better than we deserve, Dave. How are you? Just the same, sir.

Welcome. Where do you guys live? About an hour outside of Washington, D.C. in Lanesville, Maryland. Okay. Baltimore area then? Closer to D.C. Closer to D.C. Okay, cool. Well, welcome. Good to have you guys. And you're here to do a debt-free scream. How much have you paid off? Following your program, sir, is about $65,000 in 17 months. Wow. But in total is $90,000 in 28 months. Okay. All right. And so what was your range of income during that 28 months? $56,000 to $90,000. Okay, cool. How long you guys been married? Three months. Oh, there we go. Just like that. All right. Very cool.

So $65,000 in 17 months. And so it sounds like, Max, this was you. Yes, all student loans. Okay. And you were working on this, and then she just joined the parade. Carla and I have been dating for about nine years before we got married. So we were on the same page about a lot of the same things. Money was always the one thing we butted heads on. And that kind of came to a head in December of 2018.

Her and her sister got really into your podcast. And me being a finance guy didn't want to listen. I was paying off the highest interest rate first and I was making good progress on that. But like you said, you have to pay off the lowest amount first, follow the baby steps with the debt snowball because you really make the emotional but psychological progress, which is the biggest part because I felt that I wasn't making any progress. So I paid $25,000 off in about 11 to 12 months. Wow. Wow. And you just went nuts. Yeah. Gazelle intense. Ding. Okay. So it was more than just listing them smallest to largest versus highest interest rate. It was also, you started

to believe if you leaned into this, you could knock it out. Absolutely. It was doing the FPU program, bought it, started in January with Carla and her sister Emily. Every Friday night for about nine weeks we got together, had pizza, and watched FB. We had our own little group. That's good. Yeah, you had some support groups, some cheerleaders, everything. Yeah, it's all good. Very good. Good for you, dude.

Very neat. So, now that you've done it, it was all student loans? Absolutely, all student loans. What's your degree in? Finance and information systems. Of course. Okay. Now that you've done it, what do you tell people the key to getting out of debt is? Two parts.

They're a little cliche, but you have to do the budgeting. You have to have a why. Budgeting, do the every dollar budget, assign everything a category and stick to it. It takes a little bit to get used to, but that was really the biggest helpful thing for me and the Y as well. I wouldn't have it all paid off before Carla and I got married. I fell a little bit short of that, but about the day after we got married, we paid it off together. Finished the last little bit. Finished the last little bit.

That's fun. That's a way to celebrate. Good. Very good. So your main Y was to pay your debt off before you got married to Carla. Yes. How did you feel about that, Carla? Well, we grew up really different financial philosophies with our families.

And my parents never followed Dave, but had really similar ideology. So I grew up with that idea of like, you always pay off your debts. You don't invest until you are like totally free and clear. And so I just wanted to make sure we were on the same page. And it really worked out that doing FPU made sure that we were totally like money is like not a problem anymore because we're able to like totally talk about it. So more than just paying off the debt, being on the same page was like really an awesome benefit. That's a big deal. Well done.

Very, very well done. All right, Max. You and I were both trained academically the same way so our brains moved to math before heart yes and so we immediately it's still painful to me to give advice after 30 years of doing it and knowing it's right sometimes it's the nerd inside of me struggles with uh saying okay this isn't mathematically correct but it's still the right thing to do so uh the debt, listing your debts smallest to largest versus highest interest rate, is mathematically incorrect.

It is not as efficient mathematically. But the winner is that it is behavior, obviously. And personal finance is 80% behavior. It's only 20% math. So guys like you and me are out there listening to this conversation right now and you know they're saying i'm not doing this ramsey thing i'm gonna be ramsey ish and i i do the what they call that thing the debt avalanche is what somebody calls it to do it the other way right and and ramsey's debt snowball he just doesn't know what he's doing. Answer their question. They're wrong.

Yep. They're wrong. The first episode I listened to yours. Why? Why? I felt like I was making zero progress paying that $25,000 that first year, following the highest interest rate. It was just the same large payment to the same lender.

And I just saw these little guys just sitting there. It was like, still, it was like $27,000, $30,000 in that range at the end of the year. I was like, I haven't even touched these. So they were all going to interest. And the psychological thing just works. I can't say why exactly, but it worked for me, and I think it works for everyone. Your program is amazing. Well, thank you.

I appreciate that. I wasn't looking for that part. I was just saying the thing is. No, your program changed our family tree forever. Yeah, you guys are amazing. I'm so proud of you. You're heroes. And you, Carla, for showing this guy the way and then marrying him up. It's all good.

Yeah. Life is good. Yeah. You guys are amazing. You're going to be in great, great shape. Other than Carla and her sister, who were your biggest cheerleaders? Our parents as well. Okay.

Wow. Wow. A lot of eating at home. Yeah. And we lived lot of eating at home. Yeah. And we lived at home at the time. So I lived at home pretty much for the whole time I was paying off my student loans, commuting an hour and 20 minutes to and from the office. Wow.

Just, you have to make a lot of sacrifices to do this. You have a lot of time to listen to the podcast. Yep. What was the hardest sacrifice that you had to do? Selling all my investments when I first started the program. It was single stock investments, had some bonds that I was just holding on to until they hit maturity. But that was one of the hardest. But once you get past that numbers part of it and just start following, thinking about it more,

listening to the podcast, listening to your support system, it all just falls in place. Yeah. Well, here you are, debt free. Yeah. You don't have any payments. How's it feel? Amazing. of you dude well done very well done you guys are heroes very well done we got a copy of chris hogan's book for you everyday millionaires that is uh what you're going to be that's the next chapter in your story you're going to be there so very very well done max and carla from Washington, D.C. area. $65,000 paid off in 17 months, making $56,000 to $90,000.

Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Yeah! Yeah! This is how it's done right here, man. Wow. Yeah! Woo! This is how it's done right here, man.

Wow! I love it. Yeah. So Carla comes up in a household. She's a financial peace baby in a sense. They weren't financial peace people, but they were living by principles of being conservative with money, staying out of debt, saving money, and those kinds of things. And no parent ever wants their kids to experience the panic of being unprepared for a crisis. A lot of parents had to watch their grown kids during COVID freaking out because they were in a mess.

And we got your back. We can show you how to do this. We have a fully digital self-study course for your teenagers. And you can rest assured your teen will know the right way to handle money and never make the same money mistakes that millions have made best part is there's no instructor needed the courses are self-paced if your teen has a tablet or a computer they're all set it's a home study for basically homeschool in a sense self-study for home for your teenagers for middle or high school students go to Dave Ramsey dot com slash self-study Dave Ramsey dot com slash self-study and never again worry about your kids being unprepared here here's one way you could look at this Anthony you could look at this if you buy this and then make them do it it's they won't live

in your basement in the future insurance it's an insurance policy it is to move them out and Anthony's the primary teacher on it Anthony Rachel me yes I think Hogan's in some of it Hogan is in some of it but I mean again it's mainly you the best communicator on that uh platform is myself which I would definitely say on humility i mean absolutely you know but i'm just saying it's going to be fun dave i watched all of it and i'm telling you right now um it's fun but i mean your kids will learn learn something laugh and they will grow mature yeah well the cool factor anthony brings to it um and the wisdom i bring so there you go there you go yeah let's just keep going.

This is the Dave Ramsey Show. Thank you. Our scripture of the day, James 5, 16. Therefore, confess your sins to each other and pray for each other so that you might be healed. The prayer of a righteous person is powerful and effective. Brene Brown says a leader is someone who holds her or himself accountable for finding the potential in people and processes. Pam is with us in Cincinnati. Hi, Pam. Welcome to the Dave Ramsey Show. Hi, Dave.

Thanks so much for taking my call. My honor. How can we help? Well, I am 60 years old. I'm a teacher. I cannot officially retire until I'm 65. But this school year, right about a week before the school year started, I was advised by my healthcare professional that I should not return to the school due to the COVID situation and some underlying issues that I have. I'm able to work. I would work in five jobs.

I work a retail job on the side. I do copy editing on the side. I do a lot of stuff on the side. But with this big chunk of income gone, my husband, who also works, wanted to take a loan out on his thrift savings plan. He works in the government thing. And I desperately don't want him to do that no made that mistake years and years ago no and i i i'm on board with you but i don't have another option and that the thing is there's a lot of things i can just ramp up like

my copy editing business and stuff but those will take a little bit of time to build up he's just he's just panicking he's very scared absolutely so what does he make um he makes about well i can tell you let's be tricky so he makes about 45 a year and you all can't live on that and well not with the house that we have at this point, and we have a lot of debt. Okay. And we've got a lot of debt. What is the debt on? We've got credit cards, student loans, and another big loan that we had taken out. What is the other big loan? It was we desperately had to do some house repair thing.

You don't have any car payments. Well, we have $6,000 left on my car. Okay. All right. What do you owe on your home? We owe about $205,000. And what can you make with your situation right now? Well, I mean, I really think I can ramp it up and make as much i mean i figured out mathematically that i only need to bring in thirty thousand dollars a year for us to be okay and not just you know so and that's what's paying down debt and getting moving forward but the problem is just this month like these next couple of months where i where the everything's not i

haven't built up everything we don't just we just don't know how to navigate those couple months. I thought about doing DoorDash. I mean, because I'm a scrapper. I'll do whatever I have to do. So it's not okay to be in the classroom, but it's okay to do DoorDash? Yeah. Well, the environment of the school, because schools are notoriously not well ventilated.

I teach choir, and so the singing and the air of souls in a room in a crowded environment, that's what he was most concerned about. That DoorDash probably isn't – well, see, I'm not really in contact with anybody. That's what I'm thinking. Okay. I don't care. I mean, can your husband pick up some extra? See, all we've got to do is do this for 60 or 90 days

until your other stuff kicks in, right? Right. Yeah. Well, yeah, until I get the other stuff built up and he already does he works all the overtime he can right now at his present job and that pretty much whips his butt because he's working every day of the week and that's that nets him 40 grand after overtime and everything um no i think with the overtime now that he's doing that that'll probably bring us in some more than that yeah yeah so because now he's bringing home about 15 000 twice a week or not thousand fifteen hundred twice a week yeah yeah i'm looking at extra jobs especially for the next 60 to 90 days um i'm with you i like the DoorDash. I also like maybe even doing some Uber Eats.

But let me ask you the other question. What can you do as far as in a small business from home to generate some income? Yeah, you're a music teacher. That's what I was about to say. Why don't you start doing piano lessons or something? Yeah. I do already. I already do lessons, and that's one of the things I can build up.

See, I didn't do a lot because I was busy teaching school. Yeah, but the kids, a bunch of them aren't going back to school, so you could probably add some kids on piano easier than you could add DoorDash. Right, and that's true, and it's just going to take time to build that up. Not much. That doesn't happen. Not much, and I'll tell you this much. I had a vocal coach, not for singing but for speaking, and she did that online.

And so maybe you can take your your opportunities online and generate money. And there are websites out there that you can actually put your information on and they will they will actually push you out there some more. So you have some options here to go ahead and get some extra income without touching the TSP. Yeah, I'm not touching it. I'm going to make it. Yeah. I would rather get behind on a couple of bills than borrow on the TSP. And I don't think you're going to have to. Because I think some tight budgeting, lots of ingenuity on extra job things for you and hubby.

The overtime, he's already working. And you guys tighten this budget down, tighten this budget down, tighten this budget down, cut the cable off, all that kind of crap, and let's just go to work. And then as you get your income up from some of these different areas, you may end up making more than you did in the classroom when it's all over. And sadly, they may have lost a really good teacher in the process. That's really sad. I'm sorry you guys are facing this, but you're a scrapper, I can tell by talking to you, and I think you're

going to make it. I think she's going to do just fine. She's going to do perfectly. Rochelle is with us. Rochelle's in Chicago. Hi, Rochelle. Welcome to the Dave Ramsey Show. Hello. Thanks for taking the call. I am 50 years old, a probation officer. I make 50K a year.

I have 182 in student loans. Good Lord. 32,000 in year. I have $182,000 in student loans. Good Lord. $32,000 in collections. I have no savings. And I'm trying to figure out, should I give up my dreams of getting a house? How old are you again? 50. Man, you sound so young. 5'0".

Yeah. $182,000? What's your degree in? I have a, my bachelor's is in criminal justice and I have a master's, an MBA with a concentration in human resources. What are you making a year, Rochelle? I only make 50, 50K a year. And you're 50 years old. Okay. So you're dramatically underemployed giving your education? Yes. Yeah. So you have a career path problem for one thing.

No, I'm not giving up a dream of winning, period. And if part of the definition of winning is buying a house, I'm not giving up that dream. But one of the things we ask ourselves when we're setting goals around here is, what has to be true that's not true now in order to get there. Okay. So we have 182,000, 32 of which is already screwed up, right, in collections. And so we've got this ridiculously expensive degree, and now we've got to use it. So what has to be true is your income has to come up.

That's what has to be true. And then as it comes up, we're going to put you on a tight budget where you have no life for a couple years and you clean this whole freaking mess up and uh by the time you're 60 you're 100 percent uh debt free and you own a house yeah yeah yeah and and here's the thing rochelle you have to tell yourself i'm not going to give up. Okay. So stop asking yourself, am I giving up on my dreams? No, you're not giving up on your dreams. What you're doing is you're just preparing yourself for your dreams right now.

It may seem like it's late because you are 50, but that's not late. That's not late at all. You know, so what I'll go ahead and do is just use your dreams to fuel the fire where you are right now. But you have to really get hard. You don't have any time to play. You have an MBA, right? Yes.

And you live in Chicago. Yes. Yeah, you need to be making double what you're making, right? Exactly, exactly. Or would you even consider moving? Yeah. If you can't land something, you need to move. Yeah.

But the point is that you have overpaid for the degree and then underutilized the degree in creating income. Does that make sense? That makes sense. And that's caused you to feel overwhelmed and it feels like a crap been beat out of you, right? Exactly. Yeah, like you're stuck. And so we're about to unstick this, get some dynamite and light it. Rochelle, where did you go to school?

I got to ask that question. I'm a school guy. I just want to know. That's fine. I went to Aurora University in Aurora, Illinois, and I got both degrees at the same place. Okay. Hang on. We're going to send you a copy of Ken Coleman's book, Proximity Principle, to help you get going.

And you call us back, and we'll talk to you any time. We're going to be your biggest cheerleaders. You're going to make it, but it's an income issue. Anthony, good job. Hey, thank you, Dave. Thank you, America. That puts us out of the Dave Ramsey Show and the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

This is James Childs, producer of The Dave Ramsey Show. Once again, you made The Dave Ramsey Show one of the top four most popular podcasts last year. To get your daily dose of motivation and inspiration from the Ramsey Network, subscribe or follow today wherever you listen to podcasts.