The Ramsey Show - App - What if You Could Build a Life That Didn’t Exhaust You?

Episode Date: November 22, 2024

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people with their money, with their mental and emotional health, with their work, with their marriages, with their lives. I'm John Deloney, joined by my great friend, George Campbell. We are taking your calls live at 888-825-5225, 888-825-5225 on this incredible, this beautiful, cold Nashville day. Let's go out to Sheridan, Wyoming and talk to Brett. What's up, Brett? Hey, am I coming through? Yeah, you are coming through loud and clear, brother. What's up? Awesome. So I'm 24. I just took a new job. And so after expenses and rent and all that good stuff,

I have about $1,300 each month left to play with, give or take. I currently have $30,000 in student loans, but I do have $1,000 already saved up. And I'm hoping in the near future that I can buy a house here. And I was just curious as to what money markets or mutual funds that you guys would... Excuse me, sorry. I'm curious as to what kind of ways I should invest my money in to make this dream a reality, to be debt-free, and to hopefully be a homeowner here soon. Love it. Well, I'll tell you this. Right now, you should be investing in your freedom,

and that means getting out of debt as fast as possible, which then means the home dream needs to take a back seat for now. So that $1,300 extra, I don't think it's play money. I think it's get-out-of-debt money. And we'll get to investing soon enough because you got $30K in debt. What do you make? I make about $47,000, $48,000 a year. Okay, cool.

So basic napkin math says you got $30,000 in debt. You're adding $1,300 on top of your minimum debt payment um so that 1300 is just what i have left over after all of my um because you still got to make your student loan payment in that yeah so or no my student loan payment is already made um that 1300 is like once every bit of like my rents, Wi-Fi, groceries, gas, all that is paid for. Okay. So you're going to be out of debt at this rate in about a year and a half. Okay. I like to go into that.

And so, I mean, that's just if you do $1,300. If you can do $1,500, we'll clean it up faster. So that would be my challenge to you is how much faster can we get rid of this debt to get the fully funded emergency fund to then begin saving up the down payment? And if I'm in your shoes, if that down payment is going to be, you know, let's say you're going to save up for two years, I wouldn't put it in the market. There's too much risk there. I would put it in a high yield savings account. Okay. How old are you, Brett? I'm 24 years old. What's your work that you do? i'm like a lower level project manager okay i'm telling you this 20 years older than you okay i'm trying to think of something cool that

happened to me when i was 24 i got married when i was 24 so that was pretty cool but before that i can't remember i can't even remember a dinner i went to i I'm sure I did. Or a concert I saw. I'm sure I did. I don't remember it. If you will do something for your 25-year-old self, if you would go get a weekend job, or if you would leave your job and be exhausted and go throw boxes at Walmart from 6 p.m. until midnight,

and you did that for six months, you will owe nobody any money at the age of 24 or 25. Yeah, see, I was considering getting another job. I've been looking around town for part-time work, either something like early morning. I know some of the local gyms here are looking for some morning work or at night, too. So there's options here that I was considering. Dude, if you will do that, 25-year-old you will be free forever. Forever.

And I tell 20-year-olds all the time, work like crazy in your 20s. The work you put in in your 20s pays dividends in your 40s. You have precious resources at that age, which is time and energy. Yes. And a strange, like superhuman way to rehabilitate yourself. I don't understand how 20 year olds knees don't hurt like mine do, but they just don't. It's awesome. I mean, mine can get pretty sore sometimes too, I guess. All right. Well, wait till you're 40, bro. You think they do. But anyway,

dude, yes. Work three jobs, work four jobs. Give yourself a bananas challenge. Like George just laid the math out. You can be debt free in 12 months. Just right now with nothing changing. Do the math and see what it would take to be done in six months. Challenge yourself. You're 24 years old. And everyone, you'll know you're doing it right when everyone around you is like, you're crazy.

You need to rest. Honey, I'm worried about you. Yes, perfect. But then when you hit that 25, exhale, relax. Like it'd be, it'd be amazing. And here's what I'm promised is going to happen. You're going to find some synergy at your work too. People are going to ask you like, man, you're like getting stuff done. Hey, I want you to come help me on this project. Like it just has a leveling effect that levels up every part of your life in a really strange bizarre way but it's pretty cool are you in am i it oh yes absolutely i'm in i love talking to 24 25 year

olds who are like dude i'm ready to burn the ships let's go do it so good for you brother that's awesome i'm ready to i'm ready to get rid of this stuff because they said i want to live the american dream best I can. Excellent. At Brett's age, I didn't make as much and I had more debt. And I did in 18 months. So that tells me Brett's going to do it even faster and he's going to be going places because I was still a knucklehead at that age. I thought the American dream when I was 24 was a bigger truck.

I had no idea. So good on you, brother. Good on you. All right, let's go to Justin in in seattle home of allison chains what's up justin are you with us john uh you just broke up a bit oh what's up brother i'm here i think you're breaking up we got crystal clear signal man what's up all right uh i'm 23 years old. My wife is also 22, and we're over here. And we got a mortgage that we just bought on the house, like, you know, $340,000 in February. We should have, you know, not have bought this house, but we are now in it.

And now we have also car loans. So I'm calling out of getting a second opinion on some debts. How much money do you make, Justin? How much money do you make? Right now, $60,000. You have car loans, a $340,000 that $25,000 could be refunded in a warranty on the car that we just bought. Good. Gets us down to $22,000. Okay, what else?

What other debt? So that's all the debt. That's all of our debt is our house and the $25,000 cars. Is your wife working outside the home? No, not currently. She's trying to do some babysitting on the side because we just had a baby son back in September. Fun. Congrats.

Thank you. But it's not fun because you're stressed and broke. Not fun. Diapers are $1,000. They didn't tell you that, did they, Justin? What's that? Diapers are $1,000. They didn't tell you that, did they, Justin? What's that? Diapers cost $1,000 a piece. They're made of gold, I think.

No, they didn't. Costco runs definitely help, though. Hey, all right. So how can we help today? We're right up against the clock, Justin, so get right to your question, brother. I have about $3,500 in a Roth IRA that I can take out in contributions and put towards this debt. I also have bonuses that I get each

year, about $6,000. I would use the bonuses toward the debt. I wouldn't touch the Roth IRA, and I would consider selling the car if you guys are really up against this and that mortgage is more than like 40, 50% of your take-home pay, this is an on-fire situation. You got to get your income up. You got to sell the car and downgrade. And long-term, you might decide we can't stay in this house. And she's probably going to have to get a job. And so not just fiddle around the edges with babysitting, but she's going to have to open a babysitting shop in her house because y'all need income. This is The Ramsey Show. We'll be right back. Welcome back to The Ramsey Show. I'm John Deloney, joined by George Camel.

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few years of my life has been some people would call it easy street. I would have agreed if you told me 10 years ago, but now I'm struggling to find purpose. I'm struggling with being fulfilled. What does easy street mean? Well, I was in the military.

I did eight years in the U.S. Navy, and I came home, got a four-year degree, and I made the decision. I was like, okay, if I meet my eventual wife while I'm in college, then I'll settle down. I'll start a family. If I don't, I'll go back into the service as an officer, and you wouldn't say you have it. The Lord blessed me, and I found my wife, and we've been married now for six years. She is a family medicine physician and board-certified surgical obstetrician, so she makes all the money, and we have three beautiful babies.

I love my babies. I love them so much. But the Bible makes it very clear it is not good for man not to work. And I feel like the pressure is on, even though I don't need it for financial purposes. I just feel like I'm not doing anything of value, which I know is a lie. Raising my kids is the greatest value that I can have as a human being, because they're going to leave the most lasting impact you know money's only going to go so far but my kids can make a lasting impact on their communities but i just don't see the return on investment right now and that's where i'm struggling so man if you if you were here if you and i were just sitting um if we met up in Lubbock and we were just sitting down in the shadow of the stadium

having a drink, I would get up right now and I'd walk around the table and I'd give you a hug. Here's why. For some reason, you believe that your value is economic. Like, that's it. And for some reason, you have backed yourself into this corner of either or. And none of us make

good choices when it's either I gotta stay home with the kids, or I've gotta leave everything and go do, like, you have backed yourself into an either or, and you're going crazy. So take all, clear the deck. Clear the whole table. You can snap your fingers. You got a four-year degree.

You got someone that you said is a great wife who's also super talented, and her talent actually makes a whole bunch of money. My wife was incredibly talented, but she was a schoolteacher. Right? So very different. But your super talented wife makes a jillion bucks. Forget all of that. What do you want to do?

Well, I'd say that's the part of this equation that makes me feel kind of overwhelmed. You know, I'm an experienced writer. Obviously, my four-year degree was in network engineering. Hold on, Sam. Sam, I don't care any about that crap you're saying. What do you want to do? We're impressed by your LinkedIn, I promise. Yeah, it looks great.. What do you want to do? We're impressed by your LinkedIn, I promise. Yeah, it looks great.

But what do you want to do with your life? What I want to do, honestly, is I want to get into IT. I want to grab that bull by the horns, and I want to take it for a ride. What's your four-year degree in? I promise you. Network administration. Why are you not working in IT? I was, but then when my wife said, you got to go to Memphis, Tennessee. Why aren't you working in IT?

We didn't have childcare until like three months ago. And now I've been trying to fill application after application and I'm just, I'm not getting emails or phone calls back and it's really starting to kill my drive. Okay. So what you're finding out is you want to do a thing and the road you're trying to take isn't working. Cool. Can you find some folks at your local church there or over at WT and go sit there and have coffee with them and ask them about IT opportunities in Amarillo, Texas? I could probably talk to someone for sure. I don't know who that someone would be, but I could start asking questions.

All you want to do is take someone to coffee. Do you know anyone that works in IT, even Facebook friends? I gave up Facebook like 10 years ago. Okay. Well, you need to find some people who are in that field. Bro, you've got people you're in the service with that are scattered across the country. They are, actually. I tried getting help there, and they tried to help me get jobs, but even there I came up short.

Admittedly, I haven't dug in as deeply locally as I probably could have. And I'm not even from here. That's part of my hesitation. I'm like, they're going to be like, who's this guy? This nobody. I don't know who he is. No, they're not. That's bull crap. That's a story you're telling yourself. And again, it goes back to you.

That's why I would have come around the table and hugged you because the cancer here is not that you haven't found an IT job. The cancer here is you have lost purpose. You think when you checked out of the military and married an amazing woman that there was a period at the end of your sentence and that's wrong. It's not true.

It's a lie. And so when you go looking for a job, you're going looking for a job with one foot. You're just sending out a bunch of LinkedIn profiles and that's not how people get jobs. And you also, I know, you had eight years in the service. You somehow convinced an amazing physician

to marry you. And by the way, you didn't convince her. You're probably a pretty amazing guy. You went and knocked out a four-year degree when you got home. You've got all of these qualifiers that tell me that you're a hard-working, good man. The only person in your world who doesn't believe that is you.

You're not the first person that's revealed that to me. Okay, but here's the thing. You can't manifest that belief. You have to stand on a series of concrete steps that can only be stood on if you take action. Okay, so what... on if you take action. Okay. So this is you going to Sunday school this weekend and you asking for prayer requests in your Sunday school class and say, hey, I'm a military veteran.

I really want to get into IT work. I don't even know where to start. If anyone has anybody, I would really be grateful if I would love to take someone to coffee and learn about what's going on here in Amarillo, Texas. Or if anyone has a connection down in the multiple small startups that go on in Lubbock, Texas, I want a connection there. And I guarantee you somebody will call. We'll talk to you after class. And just do your homework and research and go, what are all the jobs that I really want?

What are they saying must be true for me to get this job? OK, let me make sure I have that so that when I do show up for the interview, it's not a dud. I know exactly what they're looking for. I've done my homework. I know the company. I know the mission.

I know the skillset needed. And then on top of in-person, go scour the subreddit threads for IT and see what people are doing, how they got the job they're doing. Do they enjoy what they're doing? You've got a lot of homework to do. And I think that will get you, get the fuel going again, get the fire lit.

Do you have a, do you have any men there in Emeril that you hang out with regularly? No, that's, that's part of my problem. We moved here five years ago and I never really kind of ingratiated myself in the social circles. Okay. That starts today. The most common conversation I have with former veterans is you more than anyone else on planet Earth. Veterans know more than anything what it's like to be in a relationship with somebody, stand shoulder to shoulder with somebody, who will die for you.

And it's almost impossible then to come home, to unhook from that level of community and connection and come home and sit next to some Ned Flanders in a coffee shop who's like, you know, it's really hot. And you're like, dude, shut up. I know what real connected friendship looks like. And what veteran after veteran after veteran that I talked to does, they just circle up and they stay inside their house. And Netflix says, hey, I got the next show for you. Just stay there. And so your mission right now, brother, is to go find a group of men. You can go do something with go mule deer hunting, go hiking out in the canyons,

go do some stuff with other guys. And they're going to say, no, you're going to ask again. And they're going to say, no, you're going to ask again. You can ask again. You're going to find a small little gang out there. Even if you can find some folks who used to be in the services and now they're retired out to West Texas, great, man. But your mission is to go find a group of men, one, two, five, 10, I don't care, who will do life with you. And I promise you, there will be connections into IT. Make sure to call my brother. We'll be right back. There's a time in your life and at the baby steps for renting, but you don't want to do it forever because when you rent, you're still paying for a mortgage, just somebody else's. Plus,

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at churchhillmortgage.com. That's churchhillmortgage.com. This is a paid advertisement. NMLS ID 1591. NMLSConsumeraccess.org. Equal housing lender. 1749 Mallory Lane, Suite 100. Rent with Tennessee 37027. Welcome back to The Ramsey Show. I'm John Deloney, joined by George Camel. Let's go out to Panama City, Florida, and talk to the great and powerful Jason. What's up, Jason?

Hey, how you doing? We're just partying, brother. What's up, Jason? Hey, how you doing? We're just partying, brother. What's up, man? So my question is that I have a little bit of money for my inheritance, and I'm wondering if right now is the right time to invest or if I should wait a little bit for the economy to do its thing. What does that mean? What does do its thing mean? It's been doing its thing.

Well, it's low, and right now it's starting to pick up. What economy do you live in, brother? We're at record highs every day. Are you waiting for it to crash and then get in? Well, you know, I don't know what's going to happen with the whole election. It happened. With this happening. But I'm worried that it – I've already invested some money for my kids.

Okay. From my inheritance in the trust fund. So they're taken care of as far as them. But I'm concerned about me and my wife's retirement. How much money did you get in an inheritance? I got about $100,000. Who passed away? And I put about, I used $40,000 to pay off all my debt.

That was the first thing I did. I paid off all my debt in time. Wonderful. Good for you. So, and then I had, of course, I took $20,000 from my kids, and I put $10,000 into diversified portfolios with a stockbroker and then tied a trust to it so that that's their inheritance if something were to happen to me and my wife,

specifically because I have a three-year-old son who's special needs. Do you have life insurance? So I wanted to make sure that he was taken care of if something were to happen. Jason, do you have life insurance? I do. How much? I have life insurance? I do. How much?

I have life insurance on myself, my wife, and both my kids. Okay. Why do you need life insurance on your kids? Just in case. I mean, something happens to them. I mean, it's never a bad idea that my mother had life insurance on me because both of my brothers passed away, one when he was six and one when he was 25,

and it hit my family hard financially, so my mother took life insurance out on me in case something were to happen to me. That way the funeral could be paid for. You've had a lot hit you in your lifetime, a lot of trauma. I'm the last of my family, so my father, my mother died October 1st, and that's how I got my inheritance.

I'm sorry, brother. Here's the deal. You've been making a lot of decisions out of fear. I can tell there's a lot of anxiousness about, but what if it's not enough and what I need to take care of? And I want you to just breathe. Exhale, homie. And slow down. You're going to be okay.

You are so far beyond what most people couldn't even spell the word trust. And you've got it set up for your kids already. So let me just give you some facts to slow it, let you breathe when it comes to the economy. Under President Trump's last presidency, the stock market was up 53%. Three and a half years into his presidency, it was up 53%. Under Joe Biden's presidency, three and a half years in, it was up 50%. So basic math says over a seven-year period, the stock market went up 103%. It doubled. Correct? Right. And I'm not a guru. I don't have a crystal ball. My guess is we're going to see the same thing happen over the next seven years we're going to see about

100 return and i think it's going to go half i think it's going to be worse than that and you know what what's fun about this is you still win it doesn't matter like me sitting here trying to predict it george like we don't time the market and that's what you're trying to do right now is go i want to wait till the right time i want to wait for a crash to invest i wouldn't wait i would invest now. And what you'll see is over time, the sooner you invest, the more money you're going to have later, the more time compound growth has to work its magic. And so I would, I don't know what headline you're looking at or what stock you're looking at, but I'm looking at the S&P 500, the largest

500 companies that largely represent the overall U.S. economy. And that's, you know, when you invest in a mutual fund, that's largely what you're investing in as well. The top companies. Can I give you some, a different perspective, Jason? Well, I mean, what I was worried about was, rather than putting it in the stock market, should I go into CDs that are a little bit more secure, but with less interest? If you want to lose money. Yeah, you'll lose money against inflation. Can I throw something else at you, Jason? Something totally different? Mm-hmm.

You got $100,000 and you paid $40,000 of your debt off, which left you with $60,000. You took $20,000 and created a trust for your kids, especially a special needs trust for your three-year-old, right? Mm-hmm.

So that leaves you with $40,000. Do you and your wife have a house? Our house was a gift from my father-in-law. It's paid off. Okay, so you have a paid-off home. Yes. You have an emergency fund. You have an emergency fund where you are now your own bank?

No. We only make about $37,000 a year. Cause I'm a stay at home dad. I'm a caregiver for my son. Well, listen to me. So I don't really work. You now have $40,000. I want you to put it in a high yield savings account. And now you have six months. If anything ever happens, you've got six months of taxes, bills, groceries, in an account that you never have to borrow money again. And I want you to look at what you're actually solving for. What you're trying to solve for is you're trying to look at a crystal ball

and see what's going to happen in 35 years because you're still in the backdraft of the pain of losing your mom, of losing your brothers, losing your dad. The one thing you have never had in your home is peace. And instead of trying to solve for the next calamity coming, which, by the way, they're going to keep coming. That's just life, and it sucks. It is. I want you to solve for peace so that when those things come,

you don't have a care in the world. You can just focus on being sad, on grieving. Because right now you are in a financial position that very, very few Americans are in. And that is you don't owe anybody anything. You have a paid for house. You now have six to eight months of cash in the bank that's just yours.

Period. Nobody can take your house away. Nobody can take food off your table. You see what kind of position you're in? Right. That is peace, homie. I would solve for peace. And your main breadwinner in your house makes $37,000.

That's not going to be enough money over the long term. You're all going to have to figure that out. But right now, y'all are safe. Okay? You get what I'm getting at? Yeah. I would not invest any of this extra money. That's just me.

The main breadwinner isn't making enough. And I run my own small business selling stuff at farmer's markets to try to make extra money. But in three and a half years, I only make about $10,000 a year. Okay, so let's quit that job. That's literally just dumping it into, re-into the company.

I don't even pay myself. Yeah, so it's been a hobby and we're going to stop that now. You're tired. I can hear it on you. You're exhausted. You're playing whack-a-mole with the next anxious thing that pops up let's just stop let's just put the stop

putting quarters in the machine quit playing does that sound if you hear my voice does that sound good we yeah I mean I'm just um it's it's it's I do a lot I know I mean I haven't be honest with you I haven't grieved for my mother because I know you have too much to do I know, I do a lot. I know. I mean, I haven't, to be honest with you, I haven't grieved for my mother because I have too much to do. I have too much to do. I know. But here's the thing.

Your body's grieving whether you stop and do it or not. So I've never, I've never stopped. I never stopped, man. I'm going nonstop. That's what I know. What to do. And as my friend in Simpkins says, if busyness is your drug, rest will feel like stress. And right now you're medicating with whack-a-mole.

You're medicating with busy. Stop. Tonight, it's the weekend. You're about to come up on Thanksgiving for the first time without your mom. I want you to write mom a letter tonight. And I want you to tell your mom how much you miss her. And I want you to tell your mom in that letter what kind of dad you're going to be, what kind of provider you're going to be,

and how you're going to give peace to her grandkids that she'll never get to meet. Okay? You're burning your hole through your home right now with your anxiousness. I want you to relax. You're safe right now. You got to pay for a house. You got 40 grand in the bank. You have a small account set up for your kid's future, man.

You got life insurance on everybody. You're so far ahead of the game, my man. Now you got to turn and sit and just exhale in the sadness. And that's part of the deal. We got to make Jason well again. And then this whole thing will take care of itself. And then we'll have to deal with the money. We'll have to deal with, you know, how are we going to, like, we don't make enough money to eat.

And what job am I going to do? Am I going to go back to school? We can figure all that out. But right now, we're going to exhale. We're safe. We're going to grieve mom. And when the new year rolls around, we're going to figure out what comes next for our family. Thanks for the call, brother.

We'll be right back. What does the future hold for business? Ask nine experts and you'll get 10 different answers. Economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 40,000 businesses have future-proofed themselves with NetSuite by Oracle, the number one cloud enterprise resource planning system. Ramsey Solutions uses NetSuite, and you should too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize

your biggest opportunities. With one unified business management suite, there's only one source of truth for the visibility and control you need to make quick decisions. NetSuite's real-time insights and forecasting help you see into the future with actionable data. And when you're closing the books in days, not weeks, you can spend less time looking backward and more time focusing on what's next. And speaking of what's next, download the CFO's Guide to AI and Machine Learning at netsuite.com slash Ramsey. It's free at netsuite.com slash Ramsey. Welcome back to the Ramsey Show. The Employee Benefit Research Institute recently did a study asking how many people have a million dollars saved for retirement. According to their research,

only 3.2 of Americans have a million dollars or more in their taxed advantage accounts, like a 401k and IRAs. 58% of Americans have less than $10,000 saving their retirement accounts. Dude, that's dark stuff. I had no idea it was that bad. 60%. Six out of 10 Americans basically could do a month and a half in a retirement home. That's it. As a listener of the Ramsey Show, are you staying on track with the baby steps to reach your financial goals? Here's the deal. Take a quick quiz to check your progress and receive a personalized plan just for you. Simply head to the show notes, click on the link titled, are you on track with Steps? and complete the free quiz.

If you are one of the six out of a ten of Americans that have less than ten grand, there is a light for you, but you've got to get on it. Right? You've got to begin to act differently. George, that would freak me out. That would scare me to death. Yeah, and people think it's a life sentence.

They think their DNA inherently has this in them, where they go, well, I'm just going to, I'm a broke person, John. You can change. You can just snap your fingers and go, I don just going to, I'm a broke person, John. You can change. You can just snap your fingers and go, I don't want to live like this. I want to change my family tree. I don't have to retire broke. And so this quiz will help you start to take the next step, figure out where you're really at. And if you just look at, man, basic demographic data, this same six out of 10 who have less than 10,000,

I'll go as high as 70%, 80% that are fragile. It's about the same stat that are living paycheck to paycheck. But also everybody knows that they're ringing the bell saying, hey, your social security is going to be less than. Like we're not solvent here in the next 10, 15, 20 years. By 2034, they're going to reduce the benefit by 27%. And it already wasn't that high. It's a slow car crash coming.

You've got to be your own financial planner. Act today. Act today. Act today. Check out the show notes. Are you on track with the baby steps? Complete the free quiz. Stare down this anxious moment in your life and begin to do something different. Let's go out to Stamford, Connecticut and talk to James. What is up, James? Everything above the nose, John and George. How's the day finding you?

Excellent. The same. What's up? Excellent. I need some advice. We're going to tread a little bit carefully because I am trying my best to thread the needle with my mother-in-law. She keeps giving financial and career advice to my family, specifically my wife, that do not work for our family situation and really do not work in 2024. So James, you do not have a problem with your mother-in-law. She is your proxy ward. You have a problem with your mother-in-law. She is your proxy ward. You have a problem with your wife.

I would think that you are probably correct. I am worried that my wife is going to listen to her mother. My mother-in-law was able to raise four children in the Midwest through the 80s and 90s without working. She, I don't believe, has ever worked a 40-hour-a-week job in her life. She, a couple of days, you know, helping out at this nursery school, a couple of days here. So what do you disagree on with your mother-in-law? What does she want your wife to do?

Stay at home? Well, yes. Basically all of the advice that she's giving involves things around, we have two children under six, and it's comments along the lines of, you know, when both the kids are out of daycare, my wife works as a daycare teacher as well, when the kids are out of daycare, you can leave that job and just teach music lessons. I make 60 an hour teaching music lessons, and that's great, but that doesn't make up for the income that we need in order to live where we do it. Okay, but here's the thing, James. I have the greatest mother-in-law who's ever lived. She's amazing. And I expect my mother-in-law to give the advice that she sees fit

for how she wants the world to work. I acknowledge that too. But when it comes to the life that me and my wife have to build for ourselves, she doesn't get a vote. And so your mother-in-law can say whatever she wants. Good for her. That's awesome. It's amazing. She's not the problem here.

The problem here is you and your wife are not on the same page. And so it doesn't do, it doesn't matter what your mother-in-law is saying. It matters that you look at your wife and your wife says, Hey, I want to stay home. And you say, we can't afford to do that or we can,

but here's what it's going to cost. You have to sell the car. We can't live in this particular house or in this particular neighborhood. Yeah, and at this point, we're having to have this conversation about every six to nine months or so. And I've tried showing my wife the math and that it does not work. So, James, I'm hearing your wife wants to stay home. If she could have it her way, she would stay home. Is that true?

I think that she gets the impression that she is working to pay for daycare and nothing else, and that once the children are out of daycare, that that need might disappear. And then she wants to stay home? I think so. I think part of it may be a byproduct to that's the home environment that she was raised in, so she has seen it work, but that I don't think is realistic or sustainable. I want you to reverse engineer y'all's dream that you decide together, and that might mean, okay, here's the math of it. We can't do this right now, here's why. But if she says, hey, my dream is really I want to stay home, and you want to support that dream, then you go, let's do the budget. What's it going to take? Okay, I need to do this many more music

lessons. We need to do this. We need to cut our lifestyle by this to get in a financial place in order to do this so i think she's the wow you're the how and you're going we have no way to actually accomplish this but then there's also the part of you don't want this to happen right now so this is really like john said this is between you and your wife she wants to stay home you don't want her to stay home. Take the mother-in-law out of it. Yeah, you keep crafting all these stories and imaginations like, well, it's probably because of this and maybe it's because.

It doesn't matter. Just forget all the story parts. Just sit down and look at the woman that you've made humans with. Look at the woman that you said, I do, till death do us part. Like, what kind of life do we want to have? What do we want this house to feel like when we get home every day? How much are you making a year, James? Just you. Just myself, about $60,000. And are you doing music lessons full-time?

No, Mother-in-law does music. My wife, no. She's a music teacher by trade. What are you doing full-time? I am a program director for a medium-sized nonprofit. Okay. Okay. So I think we also need to go, okay, if this is in the future, my wife staying home, we're going to be a one-income family, what changes do I need to make? What education do I need to get? What career moves do I need to make in order to sustain a good life for my family? And that's the part that I think scares you is this involves you having to change too or at least it involves y'all having to have a truthful conversation about hey what do I want

what do I what do I really want I really want to work at this job I love my non-profit work and I know I make half of what I could make in the in the in the for-profit world but I feel valued and loved here and then your wife looks across the table and says, I really want to stay at home with our kids. I see what happens in daycares. I want to be with our kids. Okay. Now we have a desires challenge. Both of us are being honest. Both of us on the table. Now we're just going to look at them at math does not care about what we want. Math is just math. So let's look at the math problem we have here. And maybe it's for three years. I'm going to stay at this nonprofit, but I'm going to work an extra job so that you can stay home

because I know that's important to you. And maybe it's, you know what, for three years, I'm going to keep working at daycare because at least I get to see the kids half the day. And we're not netting a lot of new income, but this mission that you're called to at this nonprofit is really important. But now y'all are actually talking substantively. You're being honest with one another and you're putting your hearts and minds and souls on the table.

Like you promised each other you would at your wedding and your mother-in-law doesn't get a vote. But right now when your wife says, well, my mom says that I, that's her knowing if I, she just tells you what she wants, you're going to blow by her with a spreadsheet. And when your wife says something and you go, well, it's just your mother-in-law speaking, that's you not being able to say, I really love my work. It means something to me. Do you get what I'm saying? Let's just take mother-in-law out of the equation.

Let's just talk directly with your wife. Is that possible? Yeah, yeah. Most of the time, you sound like a um actually you sound a lot like me brother you sound like a spreadsheet guy you can pull up a spreadsheet and you can make the math work or you can be real honest about it not working i want you to sit down with your wife and talk about emotions and feelings which is maybe a scary thing here's how i feel about this here's what i want i feel like your mother-in-law has a seat at our table, at dinner table. I feel like your mom has a seat in our bedroom. I don't want her

in here anymore. I want it to be us. What world do we want to create? Thank you so much for the call, my brother. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people with their finances and getting out of debt. We help people do work they love, and we help people with their relationships and mental and emotional health. I'm John Deloney, joined by George Campbell. We are taking your calls live at 888-825-5225. Let's go out to British Columbia, Canada, and talk to Allison. Hey, Allison, what's up? Hi, I have a quick question for you guys and it might not be a short answer, but, um,

let it rip. It never is. Right. So my husband and I have about $3.2 million worth of debt total. And most of that is in our business but some of that is personal and i'm just wondering is it better to focus on paying personal debts before your business debts i have a friend named denny and he can help you change your identity i think he should hook y'all up allison allison here's i hate i hate i'm like am i the first one to tell you this that's all personal debt. Yeah. You guys signed the dotted line.

There's no, like, magic businessman who gets to take the brunt of this. Yeah, that's fair. What's this debt? What's the business? So, it's a medical practice that my husband and I own. Okay, are y'all physicians? He is. I am more of an office manager. So, how are y'all working through it? Are y'all physicians? He is. I am more of an office manager.

So how are y'all working through it? Are y'all making enough to pay your bills? Are y'all working to pay this thing off? How's the business working? We got it 100% fully financed from the bank. So we do have a big loan from them, but we are able to make our payments every month, which is great. What's the debt service on that? I'm just wondering. What's the number for debt on that? What's your payment every month? On $3.2 million, what are you paying to lenders every month total?

I think it's around $30K. And what is the practice bringing in between you two and profit? So our profit at the end, like we only owned for about two to three years, but the profit every year that we've gotten is about $250,000 to $300,000, and that's after all the bills, all the loans, staff costs, everything is all paid. So you guys are essentially your gross income as a household is $250,000 to $300,000. Yeah. But then we have to make all the debt payments.

That's your take-home? Well, that's not what we take home in our personal account. We pay ourselves as contractors, and so we only pay ourselves about $12,000 a month. Okay. That's my... Are you saying your profits are after making this $30,000 monthly payment? Yes.

Okay. Okay. So how many debts are there total if you split everything out? So for our business, the reason I split it up is because they're in separate accounts and they're also taxed differently. But yes, it is all kind of one number. But for the business, it has $2.6 million worth of debt. And then the rest of our debt is all personal. Okay. So what is the other 600? So for the personal stuff, so my husband, because he's a physician, he graduated probably five, six years ago from school. He has 300K worth of student loans that he has to pay back still. And then

we have 20K for our car, 215 for our house that we still owe. And then I have 4K from my schooling as well. Okay. So your question is, what's the best way to tackle all of this? Yeah. Like where do I start? Is it more important to focus on paying personal stuff off or business stuff? I know it's best to kind of tackle everything at once if you can, but... Well, I mean, just based on the sheer numbers, if you just do the debt snowball, that would be your student loan first, then the car loan, then his student loans, then the business debt, and then the mortgage would come later.

Okay, so mortgage is always last then? The mortgage is a baby step six item. So you can consider this kind of a consumer debt. I mean, 2.6 million, that's trumping all these other debts. It's going to take a while to pay this off. Yeah. So my guess is you probably have the mortgage knocked out by the time the business debt is knocked out. I'm hoping you guys continue to make more, take home more, and use more to tackle the debt. Because right now, you're bringing home $150,000 a year. Are you paying each of you $12,000 a month? Or just as a family, you're taking home $12,000 a month?

As a family. So we do split income. Okay. Because I manage the medical practice and he physically works in the practice okay so we just pay ourselves six grand each okay gosh man he's the most so is his reimbursement capped in canada um i'm not really sure that's a good question though because i know that we can claim capital gains but that only only comes if we ever sell.

Yeah, that's not what I'm talking about. I'm talking about because of the medical system y'all have in Canada, is there a cap on what he can charge per procedure or which procedures he can do or how many patients he can have? Can he work on Sundays? I've heard there's a cap for physicians that after you make a certain amount of money, physicians just take the next four months off because they can't make any more money. I'm not really sure how that all works.

I'll have to ask my husband about that. Okay, if y'all were in the United States and you had a medical practice, I would tell you y'all need to earn more money. Yeah. Because paying off $2.6 million for $200,000, that's going to take you forever. Yeah.

Right? What's that? Is that 13 years? Y'all are going to take you forever. Yes. Right? What's that? Is that 13 years? Like, y'all are going to have to make more money. And all of your nurses are going to want raises. Like, everything's going to go up, right? And so, like, that's expensive. I just don't know if y'all can do that in Canada.

Well, we just hope that interest rates go down and so we pay less interest on our loans. Oh, sister. You have an adjustable rate loan on this thing? Yeah, we do. In Canada, is it every five years they adjust the rate? I think it's every five years, yeah. That's not on mortgages?

That's on all loans? Not on all of them. That's only with the business one, which is the 2.6 mil. Which is the giant one. This new segment is brought to you by Dr. Butler's hemorrho business one, which is the 2.6 mil. Which is the giant one. This new segment is brought to you by Dr. Butler's hemorrhoid spray, because I now have hemorrhoids. Here's some basic math for you on the business loan. You pay $260,000 a year, it would still take 10 years.

And that's $260,000 of extra money beyond all of your bills that you can throw at the business debt. So that's why we're saying we need to drastically get our income up. I'm guessing there's no way to get out of this. Like, I mean, even if you sold the practice, you're going to lose the tune of a million bucks, I'm guessing. Yeah. Yeah. There's only one way out then, and that's to increase income and decrease expenses, both in the business and in your personal life. Okay.

Which means vacations are off the table. We're not getting any more car loans. You may want to sell the car and downgrade. Truthfully, it's such a small percentage of this debt. I would just pay it off and keep the car. He's working Saturdays and probably being the only doctor's office open Sundays for half day on Sunday. Like there's just not a way. Y'all just dug yourself a humongous hole. And so you have to just find a way to get a big shovel.

Yeah. humongous hole and so you have to just get it find a way to get a big shovel yeah yeah we'd have to try to find another doctor to hire and work with us part-time or something like that potentially but you've got to make sure that works because that doctor's going to come in they need a hefty salary into salary right so he's going to have to or she's going to have to earn beyond their weight right yeah they need to bring in 600 grand a year to get paid 300 grand a year. Right. And it may be that y'all do with one less nurse and you and or your husband has to pick up some administrative duties that most fancy physicians just pawn off on their nurses. But here's what I would do in order.

Number one, as George said, I would split off the personal stuff. What's our take home? We're making $140,000 a year. We're going to pay off our consumer debt, and we're going to hammer this student loan. When it comes to the business, man, I'd find out what is your cap in the medical system that you guys find yourself in Canada, and then I'd figure out ways to increase drastically the income of this practice. I couldn't sleep with that much debt, John.

I'm so sorry, Allison. I hope you guys get out of this unscathed. This is The Ramsey Show. Rachel, do you ever get these sketchy text messages that are like, hey, you need to update your address and verify so we can get you the package you didn't order? Yes, I have, George. Sketchy and never trust them.

And that's why we recommend Delete.me. They help with that. Yeah, they do. Delete.me actually goes in and removes your information from data broker websites. And it is an incredible service that everyone needs. And there's a lot of shady companies out there that solely exist to sell your personal data to bad guys. And that means your info, like your email address, your home address, your kids' names, your name, everything is just out there for scammers and spammers to find. That's right. And then once they remove your information, then they're going to send you a detailed report telling you where they found your information, when they removed it,

how many hours they've saved you. I mean, it is incredible. So detailed and it's beautiful. I love these reports. So far, get this, they've reviewed 27,000 listings on my behalf, removed me from 240 data broker sites, and saved me 77 hours of time. It's incredible. Absolutely amazing. And Winston and I now get fewer texts, weird emails, spam calls, all of it. I love it. So you got to be sure to check them out. Ramsey fans get 20% off their annual plans. Just go to joindeleteeme.com slash Ramsey. That comes out to less than nine bucks a month. Super affordable. It's amazing. So again, that's joindeleteeme.com slash Ramsey. Make sure to check it out, you guys. Welcome back to the Ramsey Show. I'm John

Deloney. Let's go out to, oh, I'm joined by George Camel. Thanks, John. I'm here too. Happy to help. I felt you kick me under the desk. Blessed to be a blessing. I don't even know what that means. Let's go out to Cincinnati, Ohio and talk to Eric. What's up, Eric? Good afternoon.

I hope everyone is doing well. We are running a scam here called a podcast YouTube show, man. We're doing great. How about you? Couldn't be better. Thank you so much. That's awesome. What's up, brother? So fun fact, I've heard about you guys back in my senior year of 2012, heard all about the baby steps. And from years on, I've been on and off, on and off. And I hate to say it, I haven't been really committed to the the whole thing it

wasn't until this year when i almost got evicted that i well evicted from my apartment that i decided yeah i need to change i need to be dedicated i need to be devoted so i am for real this time going through the seven baby steps as we speak oh There you go, man. Drinking the Kool-Aid, finally. Yeah. So I've been completed baby step one. I have $1,000 currently saved up. As of last week, I've paid off the only debt I ever had, which was my medical bill, and I'm currently ready to start baby step three.

And this is where my question comes into play. So I did my own little research about where to put that thousand dollars I have and two things keeps popping up one is money market account and the other is a high-yield savings account good research so my question is which of the two overall would be the better choice for me, as well as what situation would one be better than the other? I'll tell you what I do, and most folks out there following the Ramsey plan, they're remarkably similar, the money market versus the high-yield savings.

The money market may have an extra benefit, like you can write checks out of it, it might come with a debit card, but outside of that, they're a savings account. And so I have a high yield savings account. And you're going to get some still really decent interest rates. We're talking over 4% with some of the good ones out there. And that'll help your emergency fund stay liquid, grow at the pace of inflation. And it's there to protect you. It is insurance. It's not an investment. So we're not trying to make money off of this thing, but we also want to keep it somewhere safe that's FDIC insured, doesn't have any minimum balance and monthly fees and all of that.

So those are the boxes you want to check when it comes to a good high-yield savings. Okay. But also, it's $1,000, man, so you can drop it in a local credit union. Don't step over dollars to pick up nickels, as my friend Lane Norton says. Don't like don't go chasing the neck well it's 0.1 percent more if i move it here so i would just choose one and stick with it yeah over complication is going to be your enemy at this point let's keep things simple man right so so which comes to another thing is there like any places i could look at to see like which would be the most beneficial place to put the $1,000. Because the one I currently have, I work with USAA.

Been in there for, like, over years ever since I joined the military. And they do this thing where it's like a.01%. So if I leave it there, I'm only getting a penny a month. No, that's terrible. You can do better. So there's a balance here. And so we've got a great partner called Fairwinds. If you go to fairwinds.org slash Ramsey,

they've got a bundle just for our Ramsey listeners. I've got a partner on my YouTube channel called Laurel Road. You can sign up at laurelroad.com slash George. That's the one that I'm using. John and Jade and Rachel, they're probably all using different ones. But the key here is you want it to be FDIC insured with minimum to no fees, and you can get that money easily. And probably a good answer,

a good question you might ask is yes, George and I both put our, our, um, emergency funds into online high yield savings accounts. I'm pretty old school. I like to go to my local bank. I still like a brick and mortar like bank from my house stuff. Um,

but I do have my emergency fund in a high yield savings account okay and the reason they're simple they have less overhead because they're online they don't have all the brick and mortars they don't have to cover as many bills and hire as many people so they can pass on their savings to you in the form of a higher interest rate but me as my wife says being born in the wrong century, I still like to shake the hands of my banker. I want to see their face. So I have both. I want to bank with a local bank for my checking account and for my high yield savings. I'm fine putting that online, knowing that I'll touch it, you know, once or twice a year. Okay. It's interesting that you say that

because I do have two banks. I have one bank for like general purpose, my second bank where, again, that's where my $1,000 is at. And I was always been thinking of looking for a third one to take my $1,000 and let that... No, you don't need to overcomplicate. You're going to get too complicated. Too many, yeah, you're going to be like triple stamp and a double stamp. Minimalist. Just, yes. A checking account with a good local bank, a credit union is a great option. And then for your emergency fund or, you know, short-term savings, we'll call it one to three or four years, a high-yield savings account with a great online institution is great.

I mean, credit unions can sometimes have great rates too. They're amazing. Hey, can you do me a favor, Eric? Yes, sir. This is kind of impromptu in front of, I don't know, several million people. You cool? Yeah, that's fine. Will you do like an impromptu debt-free scream

if we count it down? Okay. You paid off all your debts, right? That's correct. How much debt was it and how long did it take? It was around 500 bucks. It was a medical bill. You owed 500 bucks?

It's a long story. it's an emergency situation no that that's the that's the smallest debt i've ever heard paid off that's amazing this could be a world record smallest debt-free scream ever how long did you have the debt for uh oh my goodness um i've had this since I want to say December if not January wow Dunsky alright so Eric making a hundred million dollars paid off his debt of

500 bucks in uh it take you one month uh it did excellent count it down dude Let's hear your debt-free scream, Eric. All right. I'm debt-free!

That's right. Way to go. We got the music and everything. Even got it. There we go. Hey, man, we celebrate the big ones, and we will celebrate the $500 debt-free scream, because here's the deal. Freedom is freedom is freedom, right? And it comes with a promise.

You've got to promise not to go into consumer debt ever again. Promise, promise, promise, promise. Because you're following this Ramsey plan now after ignoring it for 12 years. And it's about to change your life, man. I want to set you up for freedom. We're going to hook you up with my book, Breaking Free from Broke, as well as a year of every dollar premium so you can budget your way to that emergency fund and investing and everything beyond george how many people do you see get to the stage and begin to try to over sophisticate things the amount of complication we try to do because

it seems too simple we're like no it's got to be more complicated to be smart and efficient and great and i'm going no if you look at davesey, who has more, he has enough wealth to, you know, feed my family for 17,000 generations. He owns mutual funds in real estate. He doesn't have a crypto wallet. He doesn't have 17 offshore accounts. He doesn't make it overcomplicated. And that's what I found. It's the people that don't have wealth that want to overcomplicate it. The ones that do have this dirty little secret where they go yeah i just i have a savings account i have money in the bank i invest in the stock market i own paid for real estate and it's always amazing to me that when you get around those people they have a different energy about them you're expecting more you're like no but wait there's a secret no

but it's this it's just like my give a crap i uh took it apart and i ebayed all the parts like i i just like if you're around dave just like when we go hang out I took it apart and I eBayed all the parts. If you're around Dave, it's like when we go hang out. When we go to his barn or we are out traveling. There's just an air of like, yeah, I don't care. And it's because I've just, in a complicated life, I'm going to do the things I got to do to make things as simple as possible. And you and I both have been hit up by the Instagram finance bros that are like, you pay off your 3.2% mortgage

and you can get 4.8%. It's like, bro, I will- And they use the word arbitrage and then a puppy stops wagging its tail. Exactly. Oh, it's exhausting. It's like, yeah. Get the whole life policy

and then you can borrow against it and then you need 16 credit cards to maximize the rewards. And I'm going, dude, listen to yourself talk. Exactly. You sound like a crazy person trying to maximize the rewards and I'm going, dude, listen to yourself talk. Exactly. You sound like a crazy person trying to maximize your freaking rewards to get an extra 1% arbitrage to pay for that

first class flight so you can take a picture of it and post it to your Instagram. It's exhausting. Yeah, you know what I have? I have a an Olympic wrestling mat in my living room that I just wrestle with my daughter. I'd rather spend my energy doing that. That's a flex right there. Or like, hey, wife, let's go for like a two-hour walk tonight and leave the kids rather feral. Let's just go spend time together. What a thought.

What if you could build a life that didn't exhaust you? Yeah, that you were excited to wake up and be a part of. Keep it simple. Yeah, solve for peace, people. We'll be right back. Hey, you guys, I'm not a fan of the big banks, and you probably already know which ones I mean. But I do like credit unions because they're nonprofit organizations that focus on their members. And I'm proud to endorse Fairwinds Credit Union because they share the Ramsey mission of helping people get out of debt and live generously. In fact, they design products to help keep you from going into debt

in the first place. Fairwinds has been in business for over 75 years, and they serve hundreds of thousands of members worldwide. You can feel secure because your deposits are federally insured by the NCUA up to $250,000. It's easy to join and Fairwinds partners with more than 5,000 credit union locations around the country so you can bank in person wherever you live. But if you prefer the online experience, you can log on to Fairwinds and do anything you could do at a physical location. So go to fairwinds.org slash Ramsey to learn more. And while you're there, look at the combined checking and savings account bundle they created

just for Ramsey fans to help you take control of your finances. That's Fairwinds, F-A-I-R-W-I-N-D-S dot org slash Ramsey. Welcome back to The Ramsey Show. I'm John Deloney, joined by George Campbell, 888-825-5225. The Ramsey Show question of the day. This is a spicy one. It's brought to you by Y-ReFi. Y-ReFi refinances defaulted private student loans, which are different than federal student loans. Y-ReFi refinances your defaulted private student loans and builds a custom loan based on your ability to pay. Kick your private student

loan debt out of your life forever by going to Yrefy.com slash Ramsey. That's the letter Y, R-E-F-Y.com slash Ramsey. And this may not be available in all states. Today's question comes from Meg in Maine. I've been an avid follower for 20 years and I'm debt-free. However, I'm facing a bit of a challenge and would love to get your advice. I travel quite a bit now that I'm semi-retired and I've been considering getting a travel points credit card. My plan is to charge my travel expenses and large purchases, then pay them off immediately. I feel disciplined enough to handle this without carrying any debt. Plus the idea of earning points and not carrying so much cash is appealing. But here's the kicker.

Despite having a credit score of 833, I've been turned down for several credit cards since I haven't used one in many years. Do you have any suggestions on how to approach this situation or any alternatives I should consider? I think you should get a credit card for points if you hate widows, orphans, and those who are struggling to pay their bills. Whoa, John. Shots fired.

Hot take. What's going on here? So I remember, I was it's not for Ramsey, I was moving across I was moving, I was taking a long move and the business I was moving was would pay, reimburse my move. There's a whole family, big old monster trucks.

But I had to front it. So I, oh man, I'm going to open up a credit card and with points on it and I'll make just free points. Cause I'm just going to turn around and this new company that I'm working for is going to reimburse me for the move. So I did that. And I remember getting a whole bunch of free points for opening the card. And then I got a whole bunch more points for this massive amount of money I spent right out of the gate to move my whole family. And then I was literally driving down the road and I remember thinking, wait a minute, the credit card company is not my friend. And the airline company is not my friend. Like they're not hooking me up like, bro, you spent money with us.

We're going to hook you up. Somebody's paying for this flight and somebody's paying for these hotel stays. And when I dug into it, that's when to my horror, I realized, oh, it's not the companies. It's not the credit card companies, not the airline. It's not the hotels that are paying for these rooms. It's the single mom with three kids who just left an abusive relationship, who is struggling to feed her kids, who puts this credit card in and then her boss cuts her hours and she gets a $50 late fee or a $39 late fee or her APR goes from 13 to 29% in one month. She's paying for my flight or the single dad whose wife just passed away. And like, they're scrambling and scrambling. He opens up a credit card at a desperation,

and then he misses a payment and it balloons on that guy's paying for my flights. And it, it all of a sudden got very gross for me. Like, I don't want to be a part of this system. I travel, you and I travel a lot i travel all the time all the time i'd rather pay for my own flights or work out a business arrangement with the company that's paying me to come speak for them than ever think i have some single mom who can't put food on her table pay my bills and it just got gross for me real fast yeah i mean there's a you did some research on this right there's a moral You did some research on this, right? There's a moral argument to be made.

Yeah, my book, Breaking Free from Broke. Here's the quote from the book. A 2023 study by the Federal Reserve. They set out to determine who pays for these credit card awards and the results though expected are alarming. In the report, the Fed said, we estimate an aggregate annual redistribution

of $15 billion from less to more educated, from the poorer to richer, and from high to low minority areas, widening existing disparities. Simple. And here's it gets worse, John, as I dug into it. Families with household incomes below 40 grand are less likely to even qualify for these rewards, but they're more likely to pay late fees and additional interest. The families making 100 grand or more are obviously more likely to have access to these reward cards and less likely to pay late fees and interest. So it's not saying you're a bad person if you use the rewards. This is not a moral argument to say John's a better person than you.

I mean, I'm just kidding, I'm not. But John sleeps better at night because of it. I, yeah. And can you play the game? Sure. Is it worth the 2%? Let's say you spend $25, yeah. And can you play the game? Sure. Is it worth the 2%? Let's say you spend 25 grand. I mean, is it really worth that amount to you?

Well, they put in huge font cash back. Yeah. Right? Cash back. And they go, well, it's points now, John. It's not cash. Oh, it's points. What's 100,000 points?

I don't know. It's like Chuck E. Cheese. You spend $100 at Chuck E. Cheese to get a thing that's actually worth $7. Right. So you get like a cool monogrammed Bluetooth speaker. Because I got 100,000 points. It's a no-name brand. Yeah.

You get one of those sticky hands and a pack of gum. And you're like, I spent $20 for this. Refurbished new balances, right? So can it be done? Can you be super disciplined and beat the cyst? Sure. I don't think it's worth the brain calories and the energy and the money spent to try to do it personally. And if you, I mean, geez, I don't want to make it a moral issue, but I want to call these programs to task.

If you like the idea of somebody's, of wealth being redistributed from the least of these in our communities to pay for your flights and hotels knock your lights out for me george just got gross and again we could line up the things that i need to work on i'm not a better person than anybody but in this one particular thing this is just a hot button issue with me yeah um the the banks aren't your friends the credit card companies aren't your friends the airline companies are not your friends they're running businesses they would not be giving you these flights if they weren't making that money up somewhere else. There's an old saying in the internet world. If you get online and you log in and you have to put your email address in for free and you get a product for free, you're the product, right? They want you, right? So it's similarly asking that next layer question, who's paying for these flights actually?

Who's paying for the advantage I just think I got? Because they're not hooking you up like your friend or your neighbor. Well, when you think about this, let's say you do spend $25,000 a year on travel. I think we'd all agree that's a lot. Someone's traveling a lot with $25,000 a year on travel i think we'd all agree that's a lot that's a that's a someone's traveling a lot with 25 grand a year and two percent it's 500 bucks you could put 40 bucks in a savings account every month and give yourself the rewards yeah absolutely so you're never going to convince me because of humans being emotional creatures that psychologically you're not going to spend 500 more on that card over the course of a year because you're going, well, I'll get some points. Might as well get the nicer flight. Well, and if you fly Southwest or America,

you fly these companies all the time, you get flight points for participating. I'm okay with that, right? Because they're marking up your ticket, and they're going to give you a piece. That's fine. If I fly 25 times of Southwest, I'll get a free flight. Not going to lie to y'all, that's fantastic.

That's awesome. It's that next level of hey, my gasoline, my Snickers bar, my whatever. Your haircuts, which is a... I mean, that's a lot of money. I'd get some serious cash back. But instead, here's what I do with my haircuts, John. I pay cash

and I get a discount. I know. Because we use the same barber. He gives a cash discount. Exactly. So I'm like, well, I'm making more by paying cash than by swiping my card, which, by the way, hurts the small business owner, because they've got to now pay the 3% fee or pass it on to you, all to get my 2% cash back. So either way, you are not the one winning. It's the card processing companies, it's Visa, it's MasterCard, it's Amex, it's Discover, it's Southwest, it's Delta. And these are not evil companies. This is just how they do business. And you need to understand how they're marketing to you.

There's a reason they're always offering you, hey, John, you're so wonderful. Here's more line of credit. We're going to give you an extra $5,000 in credit that you can spend. You're telling me psychologically I don't get the dopamine hit that tells me I am winning. The banks love me. Yeah, they love you. So I don't know.

As for me and my house, we solve for peace. And if i can opt out of a system i like that i like that this is truly how we love people think well they just have to say that on air dave secretly no you can check his wallet you can check any of our wallets there is not a single credit card to be found and it's not because we're scared of dave finding out it's because we truly have no need for them. Just opt out of the system. Once we started following the Ramsey plan, we're like, oh, we can just use our own money and have freedom and control over our life? Great. Sign me up.

Screw the rewards. It's just, again, let's go back to simplicity. Where's that George Campbell t-shirt? Screw your rewards. I like the one that says Go Fund Yourself. That one I'm still trying to get as part of Ramsey merch. That's fantastic. Yeah, I don't know that Dave's going to go for it yet. He could. I like the one that says, go fund yourself. That one I'm still trying to get as part of Ramsey merch. That's fantastic. Yeah, I don't know that Dave's going to go for it yet.

He could. I like that, though. He's not here a lot on the show. Just imagine if America said, go fund yourself. Go fund your own retirement. Go fund your own credit card rewards. And America would be a better place. Instead of making banks and lenders richer.

If you made a shirt that said, go fund yourself, and I made one that said, that gives me hemorrhoids. You and I would both. We'd be billionaires. America would buy those t-shirts. This is the Ramsey Show. We'll be right back. Hey, you guys, health insurance costs are only moving one way and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer and it's harder than ever to get anything approved through the bureaucracy. So if you feel like the system is working against you, try a biblically-based alternative to health insurance, Christian Healthcare Ministries. CHM is a health cost-sharing ministry that's helped hundreds of thousands of families like yours take care of over $11 billion in medical bills since 1981.

And CHM has also helped them stay true to their values and avoid miles of red tape. And CHM support goes far beyond meeting financial needs. They'll also help meet spiritual needs. Members become part of a family who will pray with them and for them when they experience a medical event. So listen, y'all, there's no better way to take care of health care costs. CHM programs start as low as $98 a month. So learn more today and join at chministries.org slash budget. That's chministries.org slash budget. Welcome back to the Ramsey Show,

888-825-5225. I'm John Deloney, joined by George Camel. This is the raddest thing I think I got going on in my life right now. Me and Dave Ramsey launching a brand new tour this spring called the Money and Relationships Tour. It's going to be gonzo. Oh, that is rad. Wheels off.

So this is a very different event than we've ever done because there's no, like, talks. There's no, like, scripts. You guys are going to riff based on what the audience wants to hear. Is that right? It will not be. Yeah, it won't be like two one-hour lectures. It will be chaos.

It will be a blast. It will, yeah, the audience gets to vote on what we talk about, and Dave and I will have spent the last six will, yeah, the audience gets to vote on what we talk about and Dave and I will have spent the last six months researching and digging into these topics and then we'll spread them out and say, alright, y'all pick from this menu. What do you want to talk about? I think Dave's accidentally starting an improv troupe.

I never thought this day would come. This is amazing. This is as close as we're going to see to Dave doing improv. So you guys are heading out to six cities. Six cities. So Louisville in April 21, Durham in April 23, Atlanta April 25, Phoenix May 5,

Fort Worth, Fort Worth, Texas. Texas, y'all got to show up for me. May 7, and then Kansas City May 9. We're going to be there live. We're going to be talking about relationship dynamics,

your marriage, your kids, budgeting, financial goals, whatever you got. Your voice will drive the night. Get your tickets at dynamics, your marriage, your kids, budgeting, financial goals, whatever you got, your voice will drive the night. Get your tickets at ramsaysolutions.com slash tour. By the way, great Christmas gifts. ramsaysolutions.com slash tour. I was telling somebody on the audience,

just a little bit, I don't get nervous. Just being on stage with Dave for two and a half hours and letting it rip. Impromptu. I'll probably be a little puckered up yeah i might show up to like the atlanta one just to see what what the heck happens there you can bomb with some questions from the audience and amazing that'd be real fun actually i'll put on a fake mustache that would be hilarious that'd be amazing but then we'd all find out that well actually you have a pretty nice beard going thank you that looks good i haven't shaved in seven months. This is all I got. It's barely a five. It's like a four o'clock shadow.

Couldn't even make it to five. No, it's a noon shadow. My face just gave up. Let's go out to, let's go down the street to Nashville and talk to Michael. What's up, Michael? Not a whole lot, guys. A little bit of stuff. We're just running the scam out here.

What's up, man? How can I help? Alrighty. So, I help? Alrighty. So, I got a question. So, me and my wife have finally got to the point to where we paid off all of our debt and we

saved up a pretty good amount of money and we actually came into a pretty good amount of money as well on top of that. And we ended up putting a big down payment on a house. Now, unfortunately, I didn't want to be in a scenario where it took both of our income to pay the mortgage. And I'm a big farm guy.

I had to have land. So we ended up with $300,000 in debt now on a home for 30 years. But I did pay my rates down to 5%. And like I said, I paid off everything. I have $10,000 to a emergency fund. I have six months of payments ready for any time. And right now it's currently only taking like $3,000 of our money to pay all of our bills.

And we grow anywhere between $8,500 to $9,000 a month. So my question is, yes, I know I went with a 30-year note. Would it be better just to pay double payments or literally take everything I got and just keep dropping it in there until I get it paid off? So you said your bills are how much per month, total expenses? About $3,000 to $3,500. $3,500. Okay. So you've got plenty of margin to the tune of, you know, five grand a month you could just chunk at the mortgage. And then you have how much? You said you came into some money.

How much is sitting there outside of your emergency fund that you could use? Outside of my emergency fund, I have, well, I put everything in the three categories. I got $10,000 into emergency fund, and I have just over $22,000 just for six months of everything. I'm going to call that your emergency fund and i have uh just over 22 uh just for six months of everything i'm gonna call that emergency so let's get your emergency fund is 30 grand well i the reason i say i got 10 000 for you like you know vehicle stuff like that they tore up um with that being said so yeah we have 32 000 and i also have um just like vacation money that we put in that we have close to five grand right now, just that way we don't spend anything extra. So we're not going to touch the emergency fund. We're not going to touch the vacation money. Keep

your sinking funds happening as they should, but all of your future income, that five grand a month, I would be throwing at the mortgage, my friend. How quickly do you think you could pay that off? I would go crunch the numbers in a mortgage payoff calculator at RamseySolutions.com and see for yourself how quickly you can pay off $300,000 making an extra $5,000 payment every month. It'll blow your mind. You'll be done in probably, my guess, four years. I mean, that's $60,000 a year on top of your normal mortgage payment, probably four years instead of $30,000. Yeah, I've already done that.

We looked into that. I just didn't know if it would be smarter to put half of that money towards mortgage and invest half the other money into something else. Well, you should be investing already. Are you investing 15% of your income? No, we have not. Like I said, we were... So when I got my wife, she had $100,000 in debt and it was all school debt. She's a school teacher. And I was big about getting that done, getting that out of our hair. And we spent the last three years just hammering at all of our big bills. How much do you make a year, Michael?

What's your household income? Do I know? What's your household income? Well, before this year, it was 120. Okay. Now it's 96 because I became,

I went from OTR to local. Okay. Can I, like, here's how I hear you asking this question. Like,

you're in the studio and you're standing with me and George and you just have your head hanging in shame. Yeah. Do me a huge favor, man. Like, George and I, would we sign off on a 30-year mortgage? No.

I'd do a 15. That's what we recommend. You paid off all your debts. You didn't go crazy. You bought a $300,000 house. George and I both live in Nashville. We both recently bought places. I don't know where you found a $300,000 house, George and I both live in Nashville. We both recently bought places. I don't know where you found a $300,000 house, but God bless

you and your family and your grandkids. That's amazing. You got yourself some land. You've paid off all of your debts, including the $100,000 that your wife came in. Hear me say this, dude. Y'all are crushing it. You're doing great. And how old are you two? How old are you two?

I am 34. She's 36. Oh, my goodness. You're doing great. So can I do some fun math for you, Michael? Yes, sir. Okay. So let's say you start investing now, and you do 15% of your income.

That's about $1,200 every month going into retirement accounts. I assume you have one through your employer? I do. Good. So we'll shovel away $1 1200 bucks into these tax advantage retirement accounts. In 23 years, that puts you at 57, correct? You're going to have probably $1.4 million in that one account. And by the way, 23 years from now, your mortgage payment has been gone for like 20 years which means you

probably increased your investing and you've had freedom for the last you know two decades of your life and so your neighbor's property and the property next to that one the property do you see how it changes your options and so you've set yourself up for that kind of future because of the hustle and grind you just spent the last few years doing so i know you're tired you're worn out you're like what do i do now we got the money you think you did spent the last few years doing. So I know you're tired. You're worn out. You're like, what do I do now? We got the money. You think you did something wrong? Should I do 17 things at once?

Just follow these steps, man. 15% of your income to retirement. Anything beyond that, throw at the mortgage, and let's be done with it. Set a goal for, let's say, five years. And if you're like me, and I have like a kind of an obscene allergy to owing somebody something. I hate people telling me what to do, and I hate owing somebody. Hate it, hate it, hate it. It's like a bitch you just can't scratch.

Yeah, so sit down with your wife and say, okay, it's going to cost us three years of some B-A-N-A-N-A-S living, but let's just do this and get this thing over with. All right, 38 years old, that's fine, but you have to work weekends, Saturdays, whatever, and we're just going to gnaw on this thing and gnaw on this thing till it's gone if it goes beyond three years and y'all can't figure out a way to do that just exhale and just say okay when i'm 40 i'm going to have a paid off house and make peace with yourself and go hunting tomorrow

morning when the season opens like you know i'm saying like you have done such a good job, man. You should be proud of yourself. Yeah, I am. And like I said, so my wife, she has this mindset like me. Like I'm a big avid hunter. And every time I see something for hunting, like I don't splurge on anything. I mean, I have the money to buy anything I want. But like I'm the type of guy that I'll go take my boots before I have to go buy new ones. Well, don't do that.

Enjoy your life and have a good time and also get this house paid off. For all of you listening to the show on YouTube or podcast, it's about to end. Head over to the Ramsey Network app and the party will continue. Go to the show notes

and you can watch the rest of the show on the app for free. We'll see you soon. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people with their money, getting out of debt and building wealth. We help them with work they love to do. We help them with their emotional and mental health, their relationships, all of it.

I'm John Deloney, joined by George Camel, and we are taking your calls live at 888-825-5225. And we are here in the network app where the party happens. James, do you feel like you can be a little more alive in the network app? Yes, I have my Americano. I'm about to go nuts. Wow, he's let his hair down? If you could see it under the hat the hair is down James is a guitar virtuoso and usually

he keeps his the knob at about three because that's where tone or blah blah blah but in the network app he turns it up to six kind of exciting stuff let loose let's go out to the 512 Austin Texas and talk to John without an H.

What's up, John? Hey, how's it going, guys? Doing alright, brother. What's up? Alright, so I am going through a season between jobs and I'm just trying to figure out the best way to approach paying off my debt

and addressing my emergency fund and everything. Um, right now I have probably 12, $1,300 in cash sitting in my bank account. I have about a $1,200 balance on a credit card, but last time I had an emergency fund, I lost my job and had to use it to get by. What does a season between jobs mean? I have been unemployed since last November. I've been looking for jobs. You haven't worked at all for a whole year?

I've been doing odd jobs and some side work to make money, but I haven't had an actual employer. Is it enough to cover all your bills? Right now I have enough cash to cover December bills. You said you have $1,200 cash. Yeah. So you're on the verge of going back into debt very quickly. Yeah, where do you live, man?

I'm outside of Austin, just north of Austin. I know, but do you have an apartment? Do you live with your family? Where do you live? I have my own house. Okay. How are you going to make your mortgage payment? My housing expenses, I was just doing the math while I was waiting to get on with you guys.

It's about $1,100, um, for rent, electricity and everything. So you're about to be out of money, right? You got one more month left. Yes. That's what I'm trying to figure out. Cause like some days I'll go out and, you know, I'll make 300, $400 and other days I'm like, what can I do to make $20 today? Okay, this is not us coming at you because we're mad or whatever. This is me honestly trying to figure out.

If you were our friend, we'd be like, dude, we need to do something. Why haven't you gone to McDonald's or Walmart? This has been a year, man. Yeah, I have applications active at Walmart and numerous other places local to me right now. It's just I haven't gotten calls back from any of them, and the ones that I have gotten calls back, they've moved on with other. Have you combed your hair and walked into one of these places and said, hey, can I speak to a manager? I'd love to work here. The smaller places I do, places like Walmart,

they're like, we don't have anybody that you can talk to. It's handled, you know, wherever. So what's underneath that? What's underneath that? Because I have a place out in rural Tennessee where my son and his high school buddies are just signing up for jobs. It feels like it's a sign-up sheet.

I feel like I'm missing something. And maybe where you are in North Austin is just very different. I haven't heard that, but maybe it is. What am I missing here? I mean, I'm not really sure. I mean, I've applied at Tesla, SpaceX, restaurants local to me. And the only places calling me are temp agencies that are like, hey, can you work a football game this weekend and stuff like that.

And, you know, obviously I take those when I can get them, but like that's not consistent enough to. What were you doing before for work? So my background is in IT and, uh, automotive maintenance, but I can't do automotive maintenance right now because I don't have a valid driver's license and it's a shop liability. Why don't you have a license? Uh, I got to pay a bunch of surcharges and some fees and stuff like that to get it back. And I just haven't had the money to make that happen. But how'd you lose the license in the first place? You just didn't pay to re-up?

Yeah, when I was in college, I lost my license for no registration and no insurance, and it just kind of snowballed from there. I ended up paying about $15,000 in surcharges, and Texas got rid of a surcharge program, so all that money just kind of went to space. Have you lived like this your whole adult life? Pretty much. I got dropped off. I was in the foster care system and just got dropped off on my 18th birthday and had to find my own way, so I didn't have a whole lot of support or anything. How old you now i'm 36 man i'm so sorry so do you have a friend in your local community that you can go get coffee with and you could just say hey i need you to level with me yeah i'm i'm usually the one you know taking people out trying to get them on

the right track because i feel like most of my friends are worse off than I am. Yeah. But if, if you're going for a year and McDonald's won't hire you, there's something else going on. If Walmart won't call you back, there's something else going on. Now, if you're writing in the job application, I need to make $90,000 or like, then that's okay. I mean, I get it. Um, and I get SpaceX andla not calling you back every engineer on planet earth wants to work there but yeah what happens if you haven't worked for a year is it goes from being scary about bills and then it goes to you start to fall into the black hole because you start to ask questions about purpose and why am i here? Yeah. Right. And you lose confidence. You lose confidence.

It's hard to look people in the eye. It's hard to get up and go ask for another job and go ask for another job. And it gets scarier and scarier and scarier. I did recently re-enroll in school. Okay. Yeah. But that's just, I mean, a lot of people do that when every time there's a recession, people will go enroll in school.

It's a way to delay the inevitable, right? And you can't afford school right now. What's it costing you? I mean, all I have to pay for is books, like being in foster care. I have a tuition waiver. What are, what are you going back to school for? Finance. Do you want to do finance? Yeah. I was hoping to be like a tax advisor or something along those lines, financial advisor. So when are you going to start in school in January? I started this past fall. So you're in school right now? Yes. Have you gone over to the library and tell them that you want to work in IT helping kids with their computers? I literally sent my

son to the IT department with his computer yesterday. Yeah, I actually talked to them. They had a little job thing like a week and a half ago, and I haven't heard anything back from them either. Okay. I would follow up with them. And because you're in school, it's actually a fortuitous moment for you. Go sit down with the career counseling office and they're going to have career counseling in there for you. And here's what I want you to say. It's going to be a humbling thing, but I want you to say out loud, at this point, I have to believe there's something about me in an interview setting that is making me unemployable. And I need some help because I work hard.

I'm smart. I show up. I bathe. I cut my hair. Like, I don't know what it is, but I need some skills. And I'll tell you, even I did some mock interviews so I would be ready for the job market, stuff like that. They'll help you walk through some of those things. Go check it out, my brother.

We'll be right back. Welcome back to The Ramsey Show. I'm John Deloney, joined by George Campbell. Let's go out to Chi-Town, Chicago, Illinois, and talk to Joe. What's up, Joe? Hey, John and George. Did I hear that correctly, I think? You got it.

What's up, man? Nailed it. Good. Hey, John and George, did I hear that correctly, I think? You got it. What's up, man? Nailed it. Good. Not much. Hopefully this is a simple one. I think I know what Dave would say. My wife and I have about $9,000 in debt. Two are credit cards, stupid.

One is student loans that she's kicked the crap out of the last eight years, and there's only about $3,100 left on it. I have $14,000 saved up. I just recently put $8,000 of it into a high yield savings account and I got my $6,000 as a three-month emergency fund. My question is, should I just say, you know what, take the nine grand and pay off all the debt, get ourselves debt-free, and then build back that emergency fund. In the time it took you to say that, you could have been debt-free, my man. I know. What are you waiting for? How long have you been on hold? You've been in debt on hold,

and you could have been free. You've been waiting to hear us bozos tell you that you should pay off debt when you have the money sitting there? Yeah, I mean, to be honest, we just ran through like the whole budget, you know, and I did every dollar, and we got a good budget. And we have about $793 each month to pay towards this debt, and it said, you know, August 2025 is when we can be debt-free, or you're just saying, screw it, do it now. Happy Thanksgiving. And Christmas.

And New Year. And Christmas, all right. And Valentine's Day. Is your wife there? She's not, no. she doesn't know I called in. I'm just in my office probably calling to certify my decision with you guys because that's what I want to do. How cool is your office?

It's pretty cool. Can you do a debt-free scream from your office right now, impromptu? I don't know if there's other clients in the other clients. That sounds like a problem for the other clients, Joe. I'm talking about you. How cool.

You want to let it rip? Sure, I'll do it. Yes. Hey, but if you do this and you don't pay off your debts right after this call, you'll get struck by lightning. Dave's got something going on with the Lord and weather and stuff. Okay, all right. I'll go ahead and do it.

You promise? Pinky swear? Like, stand by me? I pinky swear I'll do it. I can't wait to do it. I'm really excited talking about it. You promise? Pinky swear? Like, stand by me? I pinky swear I'll do it. I can't wait to do it. I'm really excited talking about it. All right, so Joe, how much do you make? $3 million?

No, no, sir. I sell insurance. It's about four years in it, and we together make about $54,000 a year. All right, and how much debt have y'all paid off total? Oh, man, so she was at, I think about $40,000. I wish she was here to do it with me, but she had it up about $44,000 when I first started dating her about eight years ago. So you all paid off $40,000 in total, $44,000 in total?

Yeah, yeah. That's about right. And you don't owe any other money? No, we don't owe any other money. We're looking to maybe buy a house down the line sometime. That's what I want to start thinking about. You'll be a big step closer if you knock this out today. And you'll just rebuild that

emergency fund. So we have Joe from Chicago makes $54,000 a year, paid off $44,000 in student loans and other shenanigans. And we're letting him preempt because he's telling the truth. And Joe's a guy of high integrity.

And he's going to pay it off as soon as he gets off this call. Count it down, Joe, to hear Debt Free scream. All right. Three, two, one. I'm Debt Free! Woo! You can't see it, Joe, but the team got the debt-free screen on the stage all lit up for you with confetti.

We're celebrating with you, my man. That sounded like an insurance agent in a cubicle, debt-free screen, but we'll let it ride. We'll let it ride. Hey, I got a nice office. You got four walls and a door. Well, hey, dude, congratulations, man. Yes.

Yes. Well, hey, dude, congratulations, man. Yes, the... George, it's kind of like... It's kind of like somebody is treading water and they've got a life raft in their pocket that they're going to deploy once they get on land. And it's like, just use it now. Use it now. They're saving it for a future trip.

There's like a rafting trip they want to go on one day. And it's like, hey, use it now. You got it. We'll saving it for a future, like a trip. They heard on our, there's like a rafting trip they want to go on one day. And it's like, hey, use it now. You got it. We'll get another one for the rafting trip later.

Why make yourself suffer? You've worked hard and free yourself sooner. Dude. I love it. It's kind of awesome. That's our second impromptu debt-free scream today.

I think you're starting a trend. I don't know if the team likes it. They schedule these in advance. I know they work really hard to get these all scheduled. The John surprises and delights. We're looking rude. Let's go out to Phoenix, know they work really hard to get these all scheduled. The John surprises and delights.

Let's go out to Phoenix, Arizona where it's probably still 117 degrees outside and talk to Marie. Hey Marie, what's up? Hello, how are you? Dude, we are rocking on to the break of dawn. What's up? Hey, alright. So here's the situation. Totally just trying to get ahead

here. So my husband and I, we work in education. And so we've, you know, with the baby steps, we're pretty much good all the way through step five. We do have a recent vehicle payment, but we're perfectly fine with paying off that vehicle within the next, I think, four years. Four years? That's like saying I'm perfectly fine having diarrhea for the next four years. That's what I just heard. We could modify that. What's left on the car loan?

You're not doing the baby steps. You're doing, like, Marie steps, which is cool. Well, we like having savings in the event that there is an emergency and i guess the way we think about it is that okay the percentage on the auto payment is less than if we have this major emergency and have to put something on a credit card and then just tell me you justify a car you couldn't afford that's okay i really wanted this car that's the american way we did some we did some phoenix gymnastics and we made it work you're telling me you could have afforded it but you did the math and you went no the lender

knows best let's make sure to take out a loan with them we could not afford it like cash that's what afford means that's what afford means that's like when my when my grandma talks about we can't afford it that's what she means in full. I love that Marie and her husband sat down and were like, you know what we should do this year? Let's make the GM of the car dealership really rich. And he was like, yeah, let's do that. Happy Honda days, Marie. Happy Honda.

All right, so we're giving you a hard time. Yeah, we're having fun. What's your question? What's going on? That's okay. So here's what we were toying around with this idea. So we're in a home right now. The home is worth around $400,000.

We still owe about $170,000 on it. We were thinking about utilizing my husband's VA loan. No! And purchasing... That was my friend John VA loan. No! And purchasing... That was my friend John. Sorry. Continue. A second property that would be our primary property

and then renting this home so that someone else essentially makes the payment for us. And then when we're ready to retire and move out of state that we would have two properties to sell instead of one one of y'all discovered tiktok and instagram you guys are too old to be on tiktok marie looking at these people going you need to arbitrage use your house and rent it out and buy another one you have 17 properties in 10 years this segment is brought to you by dr butler's hemorrhoid ointment because I have hemorrhoids. Sorry, here's the deal. Don't do this, please.

People do this all the time, and people are also broke. It sounds good on paper. They'll just make the payment for us. Oh wait, they trash the place, and when there's a tenant vacancy, now we're paying the mortgage while paying our other mortgage while we still have a car payment. Oh my gosh, life

is not as fun as they made it seem in that TikTok. They just said I'd be, like, super rich and stuff. Or there's something like COVID, and they're like, hey, listen, y'all don't have to pay your rent for the next year. Everybody just chill. And homeowners, y'all just figure it out. Even if we rented to family or family. That's even worse.

Don't do that. Oh, my gosh. If you rent to family, you're going worse! Don't do that! Oh my gosh. If you rent to family, you're going to lose Thanksgiving and Christmas too. And they're going to go, hey, listen, you're family. Do I really have to pay market rent? Give me 500 bucks. Or hey, grandma. Or hey, mom. I'll get you the money next month.

Yeah, toddler needs shoes, so we're not paying. And then you're going to go, oh, honey. Let's don't make him pay. Yes, please. Please don't do what you're about to do. Family's going to treat your home worse than any tenant. So how old are you, Marie? 50. And thank you for having fun with us. That was a good time.

All right, so if you were my mom, here's what I would hope for you. I would hope you have a 100% free, not free, but 100% paid off home that is your primary residence. Period. Second, so I would focus my energy on paying off this house and owning it outright. Then I would hope it'd be awesome if my mom had multiple other homes that she paid for. I just don't want to be left with the payments when she passes away. And so I would buy real estate with cash if that's what't want to be left with the payments when she passes away. And so I would

buy real estate with cash if that's what we want to do. And if you want to help out your family members with a down payment, be generous and give it to them. But renting to family members is just a recipe to ruin every nook and cranny of your life, financially, spiritually, emotionally, all of that. Pay off the car, pay off the house, save up and buy investment property in cash. Ta-da! This is The Ramsey Show. We'll be right back. Welcome back to the Ramsey Show. The Black Friday sales have already started and you are feeling it. Everybody's asking you to buy everything. Everyone's asking for your email address. They're asking you to buy stuff, buy stuff, buy stuff, and it's already making your heart rate go up a little bit, and we're not even to December yet. Listen, the best hedge against all this chaos is

a budget, and the best way to make the most of your money is by creating and sticking to a monthly budget. Every dollar makes it simple to plan spending, track expenses, and save for what matters most to you, all in an easy-to-use app that fits into your busy lifestyle. Keep a pulse on your spending, especially during the chaos of the holiday season when everybody's trying to get you to buy their things, and make progress on your money goals with every dollar. And yes, George and I want you to buy our stuff too, so hashtag just saying. Just budget for it.

Just budget for it, yeah, yeah. Download every dollar for free in the Apple Store or Google Play or click the link in the description if you're listening on YouTube or podcast. Hey, GK. Hit me. How has it been? How old is Mia?

15 months. God, you're still that guy? I'm that guy. A year? It's not fair to say one. She's a little over one year. Yeah. You're going to be a 77-month parent, aren't you? Can't wait. Golly.

Every friend group has that parent. I love it. Okay, so 15 months. What's Christmas going to look like? It's going to look like chaos. I was an overspender. Oh, yeah. Like, once I got a job, I bought kids lots and lots of gifts.

Can I be honest? To make me feel better. I'm not getting my kid anything. Because the entire family, all they want to do is gift her things. And the last thing I need to do is add to that pile. So you're going with nothing? Nothing. Man.

I want her to remember it when I give her a gift. And right now, she will not remember it. I'll remember it. You want that gift to be for you. Yeah. I will, you know what I'm going to do? I'm going to fund her 529 plan for Christmas. God, you're the worst dad. Cause I'm the worst. Worst dad.

Golly. I am the John Ralphio of dads. That's me. I'm going to be honest. I want to see that compound growth work instead of a depreciating asset like a Barbie Jeep. That thing's going down 60% in value in the first five years, John. Here's what I want you to know. I want you to know that when Mia says I have to move out,

I'll understand. She can come stay at our place. Sweet. Yeah, but I budget for it. I'm excited. I like budgeting for Christmas. I don't even know if I can continue. It's like a little puzzle to me to go, okay, we budgeted this much for Christmas. Here's how much we're doing per person. Now it's my job to get the deals, the discount promo codes get creative and make it all happen

i don't have hobbies i think that's been made clear by the previous sentence john likes to hunt and hang out with friends and i find promo codes online i actually have a few things for christmas i need you to buy for me but guess what who's gonna come going to come running to me? Oh, I'm going to during the next break. John's going to be like, hey, dude, can you find me a promo code? And I will find it. I need a GoPro. Help me out. You need a GoPro?

I need a GoPro promo code for my son. I got you. I need some help here. I'll do you one more. Let's go out to Fresno, California and talk to D-Money. What's up, David? How we doing? What is up?

What is up? Congratulations on the 15-month-year-old, by the way. Thank you. I think that sounds like an amazing Christmas gift, by the way. Thank you. A 529. Come on, David. Help me out.

Some dolls, some just shenanigans. All right. So what's up, brother? Hey, so here's my situation, which will preface to my question. But my family, we make about 36 36,000 a year we're in about 70,000 in debt at student loans and some credit card stuff we've worked the baby or we're working the baby steps we're back to step one so we're doing the best that we can and we're looking or i'm considering debt consolidation and i saw on your guys the

website it looks like a red flag oh thank, thank God we intercepted that decision. I know, David, this is going to be the best day of your life, except for when you had kids and got married and other cool things like that. Yeah, so right now, with what we make, we're barely able to cover just our four walls. And, like, that is just, you know, it's just continuing to, like, they're trying to just pretty much get it with the... Tell me about tell me about only making 37 grand what do you do for a living uh we are missionaries my wife and i so we left our jobs we jumped here and uh so it can be kind of unstable sometimes how much the

finances come in i know so that's our i'm going to tell you this because i love you and i'm a christian i believe in missionaries my life's been saved by me. Like I believe in all that. You can't afford to do that. Y'all made choices before you quit all of your jobs to go in the mission field. And the choices you made was to borrow $70,000. And so even if you have this important call on your life, y'all chained yourselves to a bank before. So this call y'all ran, you're still chained to it. Do you get what I'm saying? I hate this for you because I feel in my guts

that you're like, this is the right thing. We want to go help people and I get that. But y'all have already made decisions to owe 70 something thousand dollars. Y'all got to pay that off. What was the degree in? Political science. Okay, and who was that for, you or your wife?

Me and my wife has our own degree, too. Okay. So here's the short answer. Please do not do this debt consolidation move. It's going to make you feel like you did something, but all you really did was move it to a different pile that's now harder to pay off because you have one giant loan, potentially with a higher interest rate, all while paying a fee. So I would not do this. I would list out your debts from smallest to largest and start attacking the small one with a vengeance, make minimum payments on the rest.

And the only way to do this is by increasing your income like John talked about. So are you guys local missionaries? Can you do work as well? Yeah, it's actually kind of a weird kind of looking into it now, starting like a little side hustle, making t-shirts and stuff. I think you can do missionary work on the side while working 50 hours a week in full-time jobs. Go to Walmart and Home Depot and McDonald's, you'll go get jobs.

Or whatever your, I don't know what political science degree is going to get you, but go get full-time jobs and do mission work at nights and on weekends. Because you have to do the integrous thing on the front end, which is repay the people that you said,

hey, if you get me through school, I'll pay you back. And so just quitting and saying, hey, I can't do this right now. We got to go to this other thing. You got to do it in the right order, man. I hate to be the one telling you this. And you guys are living in California making

36 grand. That's poverty level. So we got to take care of our own family first before we can help anyone else how does how does this is this sound like i'm being mean to you do you don't like what i'm saying like tell me tell me how you're processing this uh i mean i mean the truth doesn't really have feelings right so um i'm hearing it and it wasn't always like this so that's something i do different options. Cause we were at healthier levels of support.

So we're like, Hey, we could do this tackling it differently. Yeah. But that, those are some things we've been thinking about as well. Well, and, and,

and bro, I, I, I was six figures, man. I'm not, this is the pot talking to the kettle here. And the reason I get so adamant about people not borrowing money is you can't

do art. If you owe somebody money, like me a comedian and musician because you always gonna have to hedge your art, your music, your, your comedy. You always gonna have to hedge it because you got to make sure you keep your rent. And that means it's never going to have that sharp edge to it that it needs to be special.

You can't ever do full ministry if you owe money because you're always going to be in service to somebody paying your donations. And if someone's paying you donations, then you kind of got to do what they say. Unless they are just open-handed, putting their money out into the tray and walking away. And so what I want you to be able to do is I want you to be able to, with no boundaries, serve God as you feel like you're being called. And you can't do that with a 70,000 pound weight

attached to your leg. You get what I'm saying? Like I want you to do mission work and ministry. I want you to go all, all, all in. But you can't. You got creditors hounding you. The average person, David, takes about 18 to 24 months to do the debt snowball, following our plan.

So for you guys, 24 months, 70 grand, that's three grand a month you have to throw. You guys are barely bringing that home. And that's why we're saying you got to get your income up. Otherwise, this is going to be a 10, 15-year journey to pay off this debt. And I feel like your mission is too important to be sitting around making payments to lenders for the next 15 years. I want, and George, I'll say this, I say this all the time. I want doctors who don't owe anybody any money

so they can do what they feel in their guts and with their training and with their mind and with the science telling them to do what's right. Same with, same with, I want missionaries to be able to follow their call all the way. I want pastors to be able to follow their call all the way. I want musicians and, and, and comedians. I want everybody to be able to go all the way with what they are called to do. And if you owe somebody money, you got a hedge because they are your boss. Pay it all off. We'll be right back. Welcome back to The Ramsey Show.

Our scripture of the day is Philippians 4.12. I know what it is to be in need, and I know what it is to have plenty. I have learned the secret of being content in any and every situation, whether well-fed or hungry, whether living in plenty or in want. The great, the great B.B. King says,

the beautiful thing about learning is nobody can take it away from you. That might be the best quote on education I've ever heard. I mean, B.B. King, he's the blues goat. That's probably going to be the most controversial thing I I've ever heard. I mean, B.B. King, he's the blues goat. That's probably going to be the most controversial thing I say today. The blues goat?

I think B.B. King. It could be, aren't you? B.B. King and Lucille let it rip. All right, let's go to Jacksonville, Florida and talk to Lisa. Hey, Lisa, what's up? Hey, how's it going? How are you guys doing today? We're just getting it done man what are you up to oh uh yeah so my question is um so i want to purchase a home but my bank is telling me that

i need to use my savings instead of getting a loan i need to use my savings to purchase a home. And at this time, I don't really want to use my savings. So I'm just trying to figure out what's the right way. If the bank is not wanting to give you a loan, that's a red flag. That's scary. They love giving out loans. So what's their logic here? Because I want you to use as much down as you can.

My bank keeps telling me no. Yeah, yeah. Why is the bank telling you no i'm not for sure if they don't want to give me a loan because maybe they they're thinking that i can't pay the loan back even though i do work i mean i don't only make about 37 a year and how much are you trying to take out on this house as a loan? $200,000. And how much do you have in savings? At this time, I have like $5,200,000. Okay, cool.

Wait, you have what? $52,000. So you got $50,000 in the bank. How do you have $50,000 in the bank and you only make $37,000. So you got $50,000 in the bank. How do you have $50,000 in the bank and you only make $37,000 a year? It's called saving. So you've been saving for a long time? Yes. Lisa, you may be the coolest person I've talked to in two weeks.

That includes my family. I mean, I save everything. I try to save everything. Currently, like, where I'm living is pretty much like, you know, like HUD housing. So I have plenty of time to save. I mean, I have my children. So, you know, taxes come around. I don't blow that money. I save.

Like, I save everything. You're amazing. I don't need those. Lisa, there's people making five times what you make that have never saved up 10 grand in their life. Lisa, you're like in the top 1% of all savers in America. But I feel like I'm struggling. I know, because you don't make much money on your income. What do you do for a living? I work for insurance.

Do you have a degree? I don't. Do you have a high school diploma? I do. Okay. I can tell you right now, if I had a small business, if I had a big business, I would hire you and your value to my company would be worth more than $37,000 a year. The fact that you can keep all of the balls juggling that you have and save and delay gratification and make the next right choice tells me you would be one of the most valuable employees I could hire.

And I tell you that because I want you to set your sights higher than $37,000. Yes, and that's what I'm focused on right now. Okay. Well, because part of this problem, I see what the bank is saying. They're going, you can't afford the mortgage. You've saved a whole lot. You're doing great on that front, but it doesn't mean you can afford a mortgage payment on a $200,000 loan.

And so we need to do a few things. We need to save up more down payment, set our sights differently on what house we're going to buy. What's the house costing right now? What's the value? It's like $268,000. Okay. So I want to type in my calculator here, $268,000. And let's say you did what the bank wants and you put down, I don't know, $30,000 out of that $52,000 because you got to keep your emergency fund. Would you call that $20,000? Well, yeah, that's what I had in mind maybe 20 grand but okay so let's say we put 32 down on a 268

15 year fix that puts your payment at 2700 bucks a month that's probably what you're taking home total well i'm pretty much taking home only like 28 but do you see the problem here though like you can't eat but you'll have a home. Woohoo! And so we can't buy a house right now. That's the hard truth. Even though you're amazing at saving, it's still not affordable. Now, if we get your income up, that changes the game. And so if you start making $75K and you keep saving up that down payment,

well, now we have a smaller mortgage payment with a bigger income. The math starts to work in your favor. And so I'm going to do it. There's option A, option B. I'm going option C and saying, hey, bank, thanks for the info. I'm not ready to buy a home right now. I got to work on my career, get my income up, keep saving. I'll be in touch.

Can I ask you a couple of potentially sensitive questions, Lisa? Sure. Have you had people in your family or in your friend circle make $75,000 a year? In my friend circle, I would say 1%. Okay. So if you grow up... In my family, 0%. If you grow up... Yeah, I grew up and my dad was a policeman and then my dad became a minister

and we didn't have a lot growing up. The thought of making 75 grand or a hundred grand, it might as well have been a million dollars for me. And it wasn't until I saw some friends and their parents and how they did, like, it was just a cool path. Like, oh, those are really great people. And here's the path forward. And so I think this will start with you believing in yourself. I'm going to send you my friend, Ken Coleman's book, the work you were wired to do. And in it comes a free career assessment. I want you to take that. Okay. And I want you to check out potentially local community college classes that you might be able to take. And I know you're thinking, John, I've got kids, I've got housing, I've got all this stuff going on.

And I think this is a moment in your life when you are looking up. I want you to hear George and I say, there's literally nothing that can stop you. And here's the second potentially sensitive question. Are you done with HUD housing? Do you want to change your neighborhood? Yes. Okay. That's the only reason why I'm planning.

Well, because I've been here for three years. Okay. And I'm like, that's the only reason why i'm planning well because i've been here for three years and i'm like that's enough can i tell you that both george and i with our families have rented before i want you to go find i don't want you to do an either or i want you to go to a totally other option i want you to go rent a place and you're going to feel like you're throwing money away you're not once you get a place you can afford in a place where your heart rate can lower a little bit and you can hold your head up high when you walk in the door like you know i'm saying and not just not not having hud housing doesn't mean you hold your head up high people are doing what they can to like to make it but i want i know that you have your height set in a different place and i want you to go get there even if that means not buying a 260 000 house

right this second right so that's what, that's what I tried to do. It's working on three months and everyone is like turning me down saying, no, you don't make three times the rent. I got that money, but go, go put down six months in cash. Oh, can I do that? If you were, if I was a landowner, you sure could. Like if I own an apartment, you're going to give me six months in cash could like if I own an apartment you're gonna give me six months in cash heck yeah and I bet you they'll give you a discount if you walk in and said I'm gonna write you a check right now for ten thousand dollars for the next however many months I'm gonna write you a check for fifteen thousand dollars and then you don't you get what

I'm saying and here's the deal then you don't chain yourself to a 15-year mortgage. That gives you a chance to breathe a little bit. It gets you a chance to change your neighborhood for you and your kids. It gets you a chance to get some space. You can drop your shoulders and take a community college class or two in the evenings. And you're going to look up in one year and two years and three years. And your whole life's going to be drastically changed. And I want you to go to your employer and say,

hey, is there some other work around here I can do, some other responsibilities I can take on to increase my salary? I know I'm valuable to this place. I'm just in awe of you, Lisa. I think you're amazing. I'm proud of you. We think you're worth more than $37,000 for how hard you work, how sharp you are.

And maybe it's a different career in insurance, a different company. I would find something that has a bigger ladder for you, where you can rise up faster. Yeah. And here's what we're looking for, George, in this situation, we're not looking for career passion yet. We're looking for an increase in income. And that means if I'm going to go be an assistant manager at a local Denny's, I'm going to go do that. If that pays me 60. Yeah. And making 19 bucks an hour would give you a raise right now. That right that's right so we're gonna go make that happen at least i'm so proud of you stay on the line we'll also hook you up with uh every dollar the best budgeting app on the planet and we'll help you transition from where you are now to where you're headed this is the ramsey show

thanks for being with us we'll see you next time take care Thank you. We'll see you next time.