The Ramsey Show - App - What's Your Mindset: Making Money or Taking Money?

Episode Date: April 12, 2022

Dave Ramsey & Kristina Ellis discuss: Making money as a moral act (with Rabbi Daniel Lapin), How to avoid student loans at all cost, How to pay a big tax bill. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. About 20 years ago, I was in a Bible study with a bunch of guys, and we were really reading different books as we came across them, and one of the guys brought a book in there, and I read it, and it has become one of my top five or ten favorite books I have ever read, not counting the Bible, and so much so that the author and I, I started talking

about it on the radio show, and the author and I became good friends. And for 20-plus years, or around 20 years now, we were trying to count it up at lunch. It's around 20 years, we've been friends and been sharing ideas and doing things for each other. And it all grew out of my love for his writing and for this book. The book is Thou Shall Prosper. I actually wrote the foreword for the reissuing of the second edition of it. It's the Ten Commandments of Making Money. Rabbi Daniel Lappin is a Jewish, Orthodox Jewish rabbi,

and he has taught me a lot about the Bible, and I've helped him with a few things here and there too. And so we've learned a lot together over these 20 years, and I want to be sure to share him with you thou shall prosper the 10 commandments making money it's the 10 reasons that the Jewish people in every culture that they find themselves in have an inordinate tendency to prosper and the 10 reasons are a good jumping off point and there are a lot of reasons that you and I have overlapped over the years yes because

we're brothers from a different mother in that sense right well in the sense that i think we both see scripture as god's message to mankind and it does change everything so i want to talk about a couple things in thou shall prosper it's one reason i wanted to have you on i knew you were in town and i said hey be sure and come by if you're in town because we want to hang out for a little bit and make sure our our current is learning about Rabbi Daniel Lappin. Even during this 20-year period of time, we've seen a deterioration of this view of business or view of success. The success has become there's an enemy there's a a war on success a particularly a war on business all business is evil all rich people are evil all

successful people are evil and it's gotten just and social media has hyped it up even more and less mature voices uh more ridiculous voices have added to the this this war on success and you know with this idea that business executives are overpaid they're greedy and and all of all of this that the rich don't pay their fair share and that runs contrary to a Jewish belief system. Yes, very much so. And it's precisely that Jewish belief system that has created what you alluded to earlier as disproportionate Jewish success with money. But in as much as you also said earlier, brothers from a different mother and the connection, it also lies at the heart of what Max Weber wrote about 100 years ago, which is the Protestant ethic and the spirit of capitalism. It's not an accident that that is what has created wealth in what we think of as the West. But in practical terms, what has happened in the country at the moment,

certainly in this country and also in many other countries, is that there has been a collapse of an understanding of the spiritual. Now, I just want to make absolutely clear that when I say spiritual, I'm speaking from the point of view of my background as a physicist, not as my background as a rabbi. So when I say spiritual, I don't mean holy or godly or anything

at all. I mean, there's good spiritual, there's bad. Spiritual just means things that you cannot measure in a lab. And so a violin or a saxophone are physical. I can measure their weight and how long they are. A tune is indistinguishable from a noise according to any laboratory instrument. What converts vibrating air molecules into a tune that can make you happy and make you dance or make men march off to war or bring a lump to your throat. All of that happens between our ears, in our brains, in our hearts, in our souls. And so music is spiritual. A musical instrument is physical. And so the key question becomes, what is money? Is it disks of metal or strips of colored paper? Or how about it's the orientation of iron oxide molecules

on the magnetic stripe behind your credit card or zeros and ones on your financial institution's computer? What is money? And it's a really important question because if it's physical, then it corresponds to the laws of physics. And one of the immutable laws of physics is that something can only be in one place at a time. And so this book right here is now here with me. And if I turn away a moment and I turn back and it's now with you, you took my book. There's no other solution. But if I teach you a tune and you go away here with my tune you've taken nothing away from me spiritual things can be in more than one place at a time

physical things can't and that's where it gets critical because if money is physical then if you have a few dollars you must have taken it from other people you see socialists, secularists, atheists don't comprehend the idea of making money. They understand taking of money. It's a very, very different thing. And the whole idea that money can come into existence as spontaneously as a tune can

is alien. And so, you know, I could sit in a room all by myself and compose a tune and then send it off as an mp3 file to my publisher, and my publisher markets it and starts collecting royalties, and he can then order a caterer to send a meal to my room. And I've produced something concrete and tangible and physical in the form of a meal in my room come about purely because of a spiritual act of creativity. And so what's happened is over the last 20 years that you and I have been talking, there has been a marked deterioration in people's comprehension of spiritual. Hugely important for everybody trying to make a living, everybody trying to build a business, because a good number of the decisions that we make in life, particularly financial decisions, are made for

spiritual, not physical or utilitarian reasons. And so when a certain lady I know very well, whose name I will not reveal, drives across town because her little app shows her gasoline costs less in another place the fact that i explained to her it's not worth your time it's not worth the the wear and tear on the car just buy the gasoline wherever it is she says no i can't do that well she grew up in new york she can't do anything else that's a spiritual thing when a person pays more money for a pair of jeans that's got a funny label on it why it doesn't it does it's it's all these are all spiritual reasons well i love that phrase there's uh the difference in making money

making money means creating you create it out of nothing out of well that's where my creativity that is where money comes out of service rather kind of service. Rather than taking. You know, everyone says the fixed pie, right? It's not a fixed pie. Yeah. We'll talk about that. The fixed pie is a beautiful, beautiful metaphor that we need to unpack. Rabbi Daniel Lappin, my guest this hour on The Ramsey Show. for a lot of you last year was another year of just trying to survive. But you don't have to live like that. You can have confidence in your money and your future.

So if you're tired of being stressed out all the time, you can decide to make a change. You can follow a plan that works. For almost 30 years, Financial Peace University has helped millions of people take control of their money. You'll learn our proven plan to save money, pay off debt, build wealth, and give generously. Watch FPU on demand or get plugged into a class for encouragement and support from other people. You don't have to face another year of stress and worry. You can have confidence in your money. FPU is only available with a Ramsey Plus membership.

Start for free by visiting RamseySolutions.com slash FPU. That's RamseySolutions.com slash FPU. My good friend Rabbi Daniel Lappin is in town, and he is a treasure, as you are discovering, listening to us. His book is Thou Shall Prosper. Check out everything he has at rabbidaniellappin.com, rabbidaniellappin.com. And he's known as America's Rabbi, a noted rabbinic scholar, best-selling author, TV host, eloquent speaker. We've spoken together many times on stages across America in many different locations. Sometimes I'm there one week, he's there the next week.

Sometimes he's on one of our events and all kinds of other things. And before we jump back in into this discussion, I want to make sure we touch on this project you're working on, Scrolling Through the Scriptures. Yes. And because it's fascinating. And they can learn about it at RabbiDanielLappin.com. But briefly, what is Scrolling Through the Scriptures?

It's the realization that this book is not an anachronistic history book about events long gone and about nations no longer existent. It is actually a technical instruction manual on how to most effectively live on planet Earth. And that means being healthy physically it means having friends it means having a rewarding and fulfilling family life and it means having a relationship with money and it means having a relationship with god and there is very practical instruction on enhancing one's lives in those five areas embedded within the Hebrew text. Now, the problem is most people can't read Hebrew, of course, but that's why I like saying everybody needs a rabbi. Even us Christians.

Especially. That's right. And, you know, I hate the idea of unemployment, so I submit my candidacy for the position of your rabbi. And so what we do is we make everything accessible in using some amazing technology. We make the actual instruction, that which has made Jews disproportionately good with money. As you said earlier, in every place and in every time of history, in hospitable countries and in tyrannical regimes, Jews have always done well with money. As you said earlier, in every place and in every time of history, in hospitable countries and in tyrannical regimes, Jews have always done well with money. And the information on that lies embedded in the Hebrew scripture. And scrolling through scripture is a program that walks somebody who has no background in the Hebrew, basically a guided tour into the wondrous garden of Hebraic information that not only makes Jews

disproportionately successful, but it actually had a lot to do with why the United States of America has become history's greatest engine of prosperity, because the founders, even going back as far as William Bradford as one of the pilgrims, they knew Hebrew, and they knew and were able to understand and extract practical life-giving information from that Hebrew text. Never been done before. This is the very first time we've done a Scrolling Through Scripture program. So find all of that at rabbidaniellappin.com. You will be richly rewarded, I promise. All right, talk about one of my favorite riffs is candles and cakes. Yeah, well, it's the same as musical instruments and music and tunes.

And that is that money is brought into existence when one of God's children does something for another. Now, we can use the right terminology. We can call it marketing. We can call it sales. We can call it sales. We can call it service. We can call it service, and there's a reason why we have a worship service, and we also say customer service. Those two are related. And we can look at our financial statements as a detached and vitally important set of data as to how our business is doing. But what is important not to lose track of is that at its root,

it's service to another human being. If that doesn't happen, you don't have a business. In the same way that we'd say if you do not have profit, you don't actually have a business. You have a hobby. You have a hobby. That's right. That's a great way of putting it.

If your revenue isn't more than your expenses, you do not have a hobby. That's right. That's a great way of putting it. If your revenue isn't more than your expenses, you do not have a business. But the socialist fallacy is, like you said earlier, if I take the book, you don't have the book. And so they look at the economy as cake. Yes. That if you get a bigger slice, that means there's not as much left for me. And you have taken rather than made. Correct. And that distinction in the first segment was vital.

And you say that is not how the economy works. Well, put it this way. There are two ways of getting money into your pocket. One way is by serving another human being. It might be a customer, a client, a boss, anybody. Another way is using a.357 Magnum revolver. Now, somebody who decides to get money that way comes home from work at the end of the day

and his wife says, Honey, how was your day? He says, Not bad. You know, did okay. She says, How much did you take? And he says, You know, I held up three people. I took a total of about $150 and some odd change. You know, that's one way of getting money. And the other way is actually serving

other human beings who then give money to you voluntarily. And the essence of business is also the essence of being a good human being, which is finding ways to please other human beings. It's beautiful. It's a wonderful thing to do. And it's limitless, other human beings. It's beautiful. It's a wonderful thing to do. And it's limitless, absolutely limitless. That's why the idea of the cake example is so fallacious. There's only so much cake. You took too much. You know, you got all kinds of things.

Must be you took it from me. This generates envy and unpleasantness and recrimination and basically breaks apart a society, which is what we see happening. It's not an accident that no atheistic regime has ever succeeded in building an effective economy. It can't happen. That's why we have the words, in God we trust, not on the walls of churches, but on the currency. So instead of cake, it's candles. Candles. You can light your candle from my burning candle you've taken nothing from me you've just brought more light into the world it's the christmas eve service yes when i

light your candle you light another candle you light another candle you light another candle and the whole place is lit up now and it started dark uh but no one stole no one was diminished that's right by passing their light along and by passing the service along you're not diminished if you view money correctly because it is um that's why they call it a currency is because it is a current yes it is not a fixed item great point it's not a fixed item right so uh changing gears just a second before i before we run out of this segment because i don't i want to be sure to get as much of your wisdom as i can get. Thank you. One of the things you've said recently that has jived again with something that I believe is, you said that, a completely different subject, that leaders who are not willing to engage in confrontation are not leaders.

Yes. Talk about that. Yeah, of course, people don't like hearing that because today the whole you know toxic masculinity and after all it's masculine to be willing to confront etc etc and so there's this huge attack on this but but look um i think the first thing to recognize is you know who is the biggest villain in your life who has caused you more aggravation through all your life than anybody else who is it who has obstructed you at every turn, who's made life difficult for you? I got a clue. His name is on your driving license. He's in your mirror. Yes. She's in your mirror. Exactly. So the most important thing is to be

able to confront yourself. And, you know, pop psychology keeps telling us, worry about your self-esteem. I'm terrific. Everything I'm doing is right. No, you screwed up. You know, stop doing that. It isn't any good. So being able to confront yourself, obviously, is a very crucial step in building a business and developing financial independence and financial peace. You know, everybody knows they shouldn't spend more than they make. So now that that knowledge is there, why are you still around? Why do we need you? You've told us what to do. And the answer is information is not enough. There has to be inspiration as well. And that is the spiritual dimension. Absolutely. Pat Lencioni talks about in his book,

The Advantage, that a company that creates a corporate culture of healthy conflict has a brand advantage over any other company that does any other thing. You beat smart people. That's a great point. You beat people smarter than you every time if you can have a mentally healthy organization that does healthy conflict. And leaders that will not create healthy conflict for the good of progress are not real leaders. And they're just acquiescing. And you get a Neville Chamberlain event when you're just acquiescing.

That's right. And that will birth a Churchill. Yeah. That's what it'll do. So, wow. It happens on the world stage, and it happens in our little businesses and in our little lives. It's so relevant. Yeah. Rabbi happens in our little businesses and in our little lives. It's so relevant.

Rabbi Daniel Lappin, the book is Thou Shalt Prosper. Check out his website, rabbidaniellappin.com, and please enjoy scrolling through the scriptures. You will be glad I introduced you to my friend of 20 years. This is The Ramsey Show. G-Show. Christina Ellis, best-selling author, Ramsey Personality, is my co-host today. Imagine the energy of a jam-packed arena filled with people ready to experience what it means to live life to the fullest. Picture all your favorite speakers together on one stage, empowering you with the tools and the principles that create unstoppable momentum in your life. That is Smart Conference.

Yep, Smart Conference is back, baby! Been three years, and we're pumped to get the event back on the road. It's time for us to be on the road again. Dallas, we're headed your way. Saturday, October the 22nd, the headlining speakers this year will be Rachel Cruz, Dr. John Deloney, Ken Coleman, George Camel, and Christina Ellis to my right, plus our own, own friends, our good friends Craig and Amy Groeschel from Life.Church will be joining us talking about marriage.

In just one day, you're going to get advice about every area of your life, money, personal growth, leadership, mental health, your career. It's not another pep talk. You're going to leave smart. That's why we call it Smart Conference. Tickets are only $39. It's a great price for a full-day event like this. As you know, all kinds of live events, concerts, and sporting events

are selling out very quickly because human beings like being around other human beings, it turns out. So, hey, we're going to be doing this big thing, and there's not a lot of tickets left. If you want to come, it's in Dallas, and you don't want to miss it, October 22nd. $39 at RamseySolutions.com. On the debt-free stage in the lobby of Ramsey Solutions, Randy and Jennifer are with us. Hey, guys, How are you? Better than we deserve, Dave. How about yourself?

Better than I deserve. Where do you guys live? Coshocton, Ohio. It's about an hour east of Columbus. Cool. Welcome to Nashville. How much debt did you pay off? On the plan, about $37,000.

Just before that, we kind of realized we were house poor, so we got rid of almost $200,000 in mortgage before that. Okay. All right. That's part of the story. So how long did it got rid of almost $200,000 in mortgage before that. Okay. All right. That's part of the story. So how long did it take to pay the $37,000 off? About 12 months. Good for you.

And your range of income during that time? We started about $55,000, and when we did our taxes for $21,000, we ended up about $96,000. Okay. $55,000 to $96,000. All right. Cool. Good for you. Well done.

I love it. What kind of debt was the 37,000? 30 of it was a 401k loan and the other seven was medical miscellaneous here and there. Okay, cool. So tell me your story. What got you guys started on this 12 months ago? So I had always struggled with money. We made pretty decent money money but i did a budget in excel and it just it didn't work and it just never worked i was always really stressed um and finally we just kind of i was honest enough to say you know i think we have too much house so we we worked on that um and then a friend of ours um gave us the total money makeover workbook um just kind of started reading through

that and it just it made sense and i'm very analytical plan oriented and i saw yeah i think yeah i saw a plan that i that sounded like it would work and uh talked to my wife about it and we just kind of got on it very cool very cool well good for you guys i think for me the hard part was i went from being homeless to then we were together and me having nothing and um so a hard part for me was literally just getting to the point where it's like it's okay to get rid of the cards i'm sorry so you were before you all were married you were literally homeless yes and how long have you been married we've been married now 10 years but we were together for 12 okay so you you were homeless literally on the streets you get married and then

a few years later this new husband sells your house no no we decided to get the home i'm like wait a minute i'm gonna choke him that was hard for me that was really hard like we had made the plan to get this home because we have seven kids, and all of them were kind of here and there, coming in and out, because some are older, some are younger. And so, for me, it was like, well, I never want my kids to go through being homeless. Yeah, I guess not, yeah. So, that was the hard part. So, there was a lot of history here, and, you know, the way you started describing it, Randy, at the start was just this sense of hopelessness.

Yeah, very much so. I couldn't figure out why it didn't work because the math looked good. But now we got into every dollar now. And looking back, I was putting numbers on a page, but it wasn't an accurate, honest budget. There was just a bunch of extra stuff in there that every dollar helped me kind of work through and actually put names to everything and kind of square us all up. That's amazing. Your story is so powerful. I love that you just, your mind shifted, you guys went for it, and now you're good at money. So what would you say? Here we are. Yeah, here you are. What was the key to getting out of debt for y'all use the program that's for

sure definitely use the program um the every dollar helped me just to be able to see where we were at and we linked up our bank accounts to it and so like he has a budget now like okay honey it's okay get your nails done it's okay to get your hair done every once in a while and so just knowing where i'm at in that um it really does help a lot that's amazing gave you a communication cool tool to pull together absolutely i think for me it the the plan gave us a lot of tools but i i woke up one day and i just i decided that we're gonna we're gonna make something happen i wasn't sure how and that that's what the plan did for us but it i just i had to decide that we're going to make something happen. I wasn't sure how. And that's what the plan did for us. But I had to decide that we were going to do something different.

And now, so you sold the expensive house, but you bought another house. Yes. We did. We did. Because I'm making sure you're not homeless. Oh, no. I'll never go back to that again. No, and actually, the 401k loan was for...

Fixing up the house that we bought. Yeah, the other half of the house. So her dad passed we got some money there put it with our 401k and we actually paid cash for the house we have now oh wow so so you are 100 debt free we are congratulations baby step seven baby whoop whoop absolutely looking at weird people yeah you guys are amazing congratulations very good yeah for all the people who think that they are bad at money, who think that they can't do it, what would you tell them? Be honest. Don't be afraid to ask for help because that's what it took for me.

Just kind of a circle of a couple friends. And we were all just kind of talking about it. We were talking about, you know, investing here and nuts and bolts stuff there. And it didn't really click. But once, you know, I got the total money makeover book and it just laid out a very clear plan that it just made perfect sense and we were just off to the races. Yeah, way to go, guys.

We're very proud of you. You're amazing. Congratulations. Thank you. Who was cheering you on? I think that same circle of friends, Tony and Melissa, they're the ones that gave us a couple of wealth books.

But the workbook was in one of them. Your mom? Yeah. I would say your mom. Yeah, my mom for sure. She kept cheering us on. Yeah. She thought it was a good idea to have some common sense in her family.

She did. She did. I think one thing that really helped, and I know this sounds kind of crazy, but when he got deployed, that helped a lot because we were able to get his regular income plus the deployment pay on top of it to just knock everything out at once. So you're National Guard, Randy? I'm part of the State Defense Force in Ohio. It's the Ohio Military Reserve. But, yeah, I very much lucked out because when I was on active duty, the state pays me as a soldier, but my employer never stopped my paycheck either. So we got very fortunate there, and that helped us just absolutely knock through three.

Yeah, it is fortunate, but it's not luck. Right. It's called serving your country, and people appreciated it, including your employer. Way to go, employer. Yeah. Who's your boss? Who's your employer? At that point, it was TS Tech in Reynoldsburg.

Way to go, guys. Yeah, way to go. Support your people, man. That's good stuff. Absolutely. Good stuff. Yeah, way to go. Support your people, man. That's good stuff. Absolutely. Good stuff. Well, way to go, you guys. We got a copy of the Baby Steps Millionaires book for you.

That's the next chapter in your story for sure. You're going to be there. And also a copy of Total Money Makeover. You can give it away and stir up a ruckus for somebody else. Absolutely. You never know. That'll be perfect. Well done.

I will say one thing that has really been nice, even just coming here. I mean, this is amazing. But we were able to do some things that I never thought that we would be able to do. And the whole time, like, we were going through things and we're like, it doesn't matter. Like, we already had it budgeted. We already have that money. We don't have to worry about that for us to just go and be like hey jack daniels how about a 200 bottle of wine this this is the first vacation ever that i haven't been sitting at the end of the day just

crunching numbers and figuring out if we're still okay or if we need to start skimping down yeah that's it's amazing well when you don't have a house payment or anything uh you can you can afford the jack daniels absolutely way. Way to go, you guys. All right, Randy and Jennifer, Columbus, Ohio area. $37,000 paid off in 12 months, but quite a story, making $55,000 to $96,000. Count it down. Let's hear a debt-free scream. Three, two, one.

We're debt-free! Yeah! I love it! This is The Ramsey Show. We'll be right back. I do. You want me to read it? Our question of the day comes from blinds.com find out for yourself why blinds.com is the number one online retailer of custom window coverings free samples free shipping and the new promos they run all the time you'll save even more always use the magic word the promo code ramsey to get the best deal today's question comes from phoebe Duluth. I am 21 years old and working on getting my teacher's certificate.

I work three part-time jobs so I can graduate debt-free. I recently got engaged and my fiance is currently in undergraduate school with a plan to go to med school after we get married. His parents are currently putting him through undergrad school so that he will graduate debt-free as well. Our plan is that while he is in med school, I will work full-time and he will work part-time. We'll start paying off his med school student loans before he even graduates. My question is, what can I do now to keep the student loans to a minimum and start to save money? That's a great question, Phoebe. There are so many things that you do,

and I love talking about this topic. Of course, my go-to is always scholarships. I was able to win over a half a million dollars and just put myself out there constantly, treat it like a part-time job. How hard is it to find a scholarship from med school? It's harder than undergrad, which is challenging, but they're still out there and often called fellowships or there are specific programs that have benefits and are a bit cheaper than others. So I always encourage people to dig deep. I feel like so many people instantly say it's med school. There's no scholarships out there for that. And that's just not true.

Well, I got accepted here, but and this is the place and no matter what it costs, I got to go because I got accepted here. Right. And that that that could be triple the cost of another med school. Right. And how often do you check your doctor's credentials? None of the time. Right. I've never gone to a doctor and said, no, you really can't take that mole off of my head because you went to the wrong school.

It never came up. Right. You didn't go to an Ivy League, so I'm out. Yeah. Doesn't happen. Right. So you've got to think outside of the box.. It never came up. Right. You didn't go to an Ivy League, so I'm out. Yeah. Doesn't happen. Right. So you've got to think outside of the box. Be willing to bend and be flexible.

I mean, especially with med school, we're talking potentially hundreds of thousands of dollars. So be willing to look outside of even your state if it's a bit cheaper. Be flexible. Be willing to be strategic. Well, for $200,000, would you move? Yes! Yes. Temporarily to go to med school in another

town you bet you would you would lift your tail end up and go i mean it's you know you got a fellowship the md phd programs are like they work like a fellowship and that's a way to go through med school they're very hard to get into it's a very elite uh class that goes to that, and that is very much grade-based and very much academics-based and so on. But man, Duke has one as an example, their med school, but if you can get into those, you go free. And by the way, the military will send you through free. Yep.

That's definitely a great way to look at it. We've talked to several military doctors who sometimes there's a service commitment, but if it helps you graduate debt free and you get experience, that's like a double win. But I love the way that they're thinking. I love the way that even at a 21 years old, Phoebe is already thinking through, you know, how can we plan this out? Because that's part of the problem is so many people are not looking ahead. They're just thinking, this is the degree I need right now. This is the path that I have, and I'm going to do it at all costs. But the fact that she's stopping and saying, hey, we want to do this in the future, but we're going to be really strategic at every step of the way is huge. That's not what a lot of 21-year-olds are doing right now. Well, and one of the things I learned to do about the whole debt subject in general is just say, okay, I't borrow money period now what and if you take it as an option take away the option of it and you go well i just can't go if i don't figure this out you suddenly start figuring out a way to you find a way to do it then but if you go well i'm just going to limit the pain i'm going to limit my level of stupidity.

I agree with you. I really like that they're looking ahead and that they're 21 years old. But I would challenge you to treat it like you can't go unless you find a way. Right. Well, and that's part of my story is so many people look back and they're like, were you trying to go debt free? Did you have this big strategy to avoid student loans? And honestly, my mom was an immigrant from Venezuela. We didn't even know about student loans when we started the journey.

I thought if I was going to go to college, if I was going to go to school, that I had to figure out a way to pay for it. Which means you go figure out a way to pay for it then. Right. That's the only option. There was no other option. Yeah. And so we do meet people that come through here from time to time. And I will admit they're fairly rare. They're harder to

find than undergrad but i meet people that have graduated from law school and people that have graduated from med school several times a year debt free and it wasn't parents paid for they figured out a way to get someone whether it's scholarships fellowships whether it's md phd programs whether they sign on with the hospital whether they sign on with the hospital, whether they sign on with the National Guard, whatever it is they're doing, they find a way to not be $300,000 in debt when they come out of med school. And they start their life with a big income, potentially, but in a big hole. Right. And that's the thing that I think they sell a lot of times with degrees in general is

they say, you're going to have this huge income, so obviously you're going to be able to pay it off. It's no big deal. But that's the thing that I think they sell a lot of times with degrees in general is they say, you're going to have this huge income. So obviously, you're going to be able to pay it off. It's no big deal. But that's just not true. You know, we saw in Borrowed Future the orthodontist who had a million dollars in student loans. And even though he had a great income, that was hard to pay off. He was overwhelmed. He was in tears. Like, even though the income was huge, with that amount of debt, it is stressful.

I was in tears, and it wasn't even my debt. It's unbelievable man the poor guy it was it was just heartbreaking so hey that that's the thing so kudos to you phoebe for looking ahead as christina said and studying but we're challenging you to even go one step further and be radical and say okay let's just take the idea of debt away as even an option. Now what are we going to do? Three heartbeats later, your brain kicks in, and the lump drops out of your throat, and you go figure out a way to do it. And I'm going to challenge you to do that because people are able to do this.

And let me tell you, 100% of the people that start med school do not graduate. They don't have a 100% graduation rate. Could you imagine taking out that debt and then out that debt? And then not making it? And then not making it? This is, yeah, everything's not rainbow and skittles, baby. This is how this works. All right. Amanda's with us in Washington, D.C.

Hi, Amanda. How are you? Hi. Thank you so much for taking the call. Sure. We inherited a home worth $400,000 in 2009 that we used as a rental property and we sold it last year for $425,000. We contacted our CPA before we sold it and he was told we would only be taxed on the capital gains of the $20,000 difference.

That's correct. So we just got our, well well we were really shocked we just got a tax bill for fifty two thousand dollars for depreciation recapture oh well there's never heard of okay so you you depreciated the property while you were there while you had it yes exactly and so um we're 40 years old Our oldest is finishing sixth grade. Wait a minute. You sold the house for $400,000. Where did that money go?

We used the majority of the profit to pay down our current mortgage. Okay. So how much money do you have in the bank now? We don't have any. Well, we have our emergency fund of thirty five thousand dollars you didn't have a fifty two thousand dollar tax bill you had a fifty two thousand dollar increase in income that they paid that they charge your taxes on from right from the depreciation over 12 years of owning the property. So we're trying to know if we should use our emergency fund. So the tax bill is $50,000? Yes.

$52,000. And you have $35,000 to your name. For our emergency fund. Where else And you have $35,000 to your name? For our emergency fund. Where else do you have money? I mean, we have money in retirement, but as far as... Do you have any money that's not in retirement? No. Our liquid assets are the emergency fund.

What's your household income? My husband is a nurse. So he picks up as many extra shifts as he can. He works about an hour away. And so he approximately, when he's able to work four to five days a week, he brings home approximately $6,000 a month. Okay. He's going to be working a little more.

I'm putting the $35,000 on this, and I'm going to put the rest of it on a payment plan with the IRS, and I'm going to pay it off. Nah, I'll go get an A. I'll take out a home equity loan for the balance. You're already in debt to the IRS. I'm just restructuring your debt to a different kind of debt. I'm not telling you to borrow money, but you're in debt. So put $35,000 on it, borrow the rest on a home equity loan,

and pay it off in three months, and your husband works 24-7. This is The Ramsey Show. Dave here. You can find all of our shows with the Ramsey Network app on your smartphone. It's the only place to listen to the entire back catalog of episodes.

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