The Ramsey Show - App - Where to Stash Money For Your Daughter's Wedding Fund (Hour 2)

Episode Date: November 9, 2018

The show about you

🎵 Live from the headquarters of Ramsey Solutions, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. You jump in, we'll talk about your life and your money. It is a free call at 888-825-5225. That's 888-825-5225. We're going to start this hour off with New York. Mike's calling.

Hey, Mike, welcome to the Dave Ramsey Show. How's it going, Dave? Better than I deserve. What's up? Hey, first off, I just want to say we've been following your steps for the past few years, and you have completely changed our family tree. You've changed our lives. We're out of Baby Step 2.

We're out of Baby Step 3. We're doing 4, 5, and 6 right now. So, again, I first want to say thank you so much. Absolutely. Our pleasure. How can we help today? So my question is I'm about three pages away from finishing Smart Money, Smart Kids. And I read the chapter about, you know, you and Rachel talking about weddings and preparing for weddings.

And I have three kids. Two of them are daughters. Now, granted, they're five years old and they're two years old. However, given the fact that they're eventually hopefully going to get married at some point, and I'd like to be able to pay for that, how do you suggest doing that? I mean, it's a long time horizon. Should I invest? When I invest, do I start worrying about capital gains as it gets closer? What do you suggest? Well, I mean, basically, you're going to be building your wealth in your 401ks and in other mutual funds as you go along. You're also going to be building your wealth in your 401ks and in other mutual funds as you go along you're also going to have your kids college going if you're following our baby step plan which it

sounds like you are and so you know what i'm going to do is just as i you know as the kids start getting into teenage years i'm going to start looking and saying okay i need to probably think about making sure i have enough over here in a non-retirement mutual fund to cover the cost of a wedding. You probably will have just in general wealth building because you're well on your way. You're probably just going to have enough money. It's that simple without technically today labeling it a wedding fund. You'll probably just have enough. But if you don't, I mean, if you get up there, the kids are up into their teens, and you look and you say, you know, I've got four, five, six years here,

whatever it is, and I need to start thinking about this. Well, then you would be very intentional, and you might say, hey, I've got the margin. I've got the room in my numbers. I'm already doing my retirement. We've already got their college underway, and I've got the room to uh intentionally save towards that wedding and um and there you go you know but the funny thing is is that a lot of this stuff is just solved as you you know finish paying off your house you can cash

flow a whole lot of stuff you know uh when you your retirement is underway your kids college is underway you just got the what you just got the wealth building going. And you're going to be able to use it for a lot of different things, and certainly a wedding is one of the possible options. JJ's in Rockford, Illinois. Hey, JJ, welcome to the Dave Ramsey Show. Hi, Dave. It's an honor to speak to you, sir. You too. How can I help? Well, sir, I've been married for 20 years and my wife and i've been separated for three and as you say most of it is all because of money most marriages because of money so uh

this is the third time that my wife and her spending habits have got us greatly into debt so that's the reason why we've been separated for three years and trying to get it to work out between her and i all boils down to us not being on the same page. And at this point, this is where I'm stuck. I was introduced to you three weeks ago through a small group at church. And as I have watched 30 hours of you on YouTube over the last three weeks, there's a lot of stuff you say that makes sense. I have a thousand dollars already saved. I, I, in the past have always snowballed my own bills to pay them off. And as I pay my bills off, she hands me a new stack of bills. So this is

where I'm at to divorce or not to divorce. Um, part of, and also i want to know a little bit about 401k i am obviously in debt to my eyeballs um my total debt is approximately fifty thousand dollars that is with the house car credit cards okay and what is your what is your income um my net income is 565 a week that's your take-home pay is two my take-home pay is yeah i mean i basically take home twenty nine thousand three hundred eighty dollars a year okay so you're making about thirty seven thirty eight thousand bucks what does she make um every time i ask she says i don't know uh i know she is a a gas station manager and a waitress she works two jobs i work two jobs my second job is a cash job and i only make a couple thousand dollars a year okay i i would i would say she probably makes roughly what I make. Yeah. She also has $73,400 in student loans with no degree. Mm-hmm.

She owes $5,000 on a car. She lives in her own place. We're separated, so she lives in her own place. She pays $600 a month in rent. Mm-hmm. Okay. Are you guys seeing a marriage counselor? We've seen one about 10 years ago. what i asked i ask if you are seeing a marriage not currently okay so why why is there

hope that the two of you are going to work this out if you're standing over here throwing rocks at her and that is your plan right now for getting back together. Well, I never really looked at it as I was throwing rocks. Well, you just did for the last five minutes. I'm not sure she didn't need rocks thrown at her, but you've been throwing them at her for the last five minutes while we're talking. Yes, sir. So, I mean, there's no meeting of the minds. There's no reconciliation.

There's no game plan where we get on the same page unless you've got some help doing that. I mean, you've been separated for three years. You guys need to start working at saving this thing or call it. Okay, marriage counselor, right? Yeah, number one. Number one, call your pastor. Say, Pastor, we need to sit down. And if she will sit down with you, then the two of you start working towards having a game plan together.

Now, the way that a healthy, quality marriage works around the money issue is, there is no yours and mine, it's all ours. When you got married, the preacher said, and now you are one. He didn't pronounce you a joint venture. And so she's going to put all of her income in the middle of the table, you're going to put all of her income in the middle of the table. You're going to put all of your income in the middle of the table. She's going to put all of her debt in the middle of the table. You're going to put all your debt in the middle of the table.

And for richer, for poorer, in sickness and in health, until death do us part, we're going to use that pile of income to attack that set of debts, and we're both going to be adults and talk about every single thing that happens with money before it leaves on paper that's called a budget that we both agreed to and then we both agree to stick to it that's how a quality marriage with cooperation and communication deals with the issues you put in front of me. And that's what good marriage counseling will lead you guys into doing. So I think she's misbehaving. I agree with you. But I think you guys are not working towards putting everything on the same page. And if you're not going to do that, then you're not married

anymore. I mean, you just got to talk that through with your pastor, you know. But you need to sit down with a good marriage counselor and say, hey, how can we get on the same page aiming at the same thing? It's not you telling her what to do. It's we're going to put it all in the middle of the table, and the two of us together are going to grab hands, and we're going to decide how we're going to handle every one of these dollars this month and next month and next month.

And what are our goals, and how are we going to hit them? One question I get asked all the time is, do I need life insurance? Listen, the whole point of life insurance is to replace your income for someone who counts on you. So if you have a spouse or you have kids, yes, you need term life insurance. It's the only way to protect them until you're out of debt and have built up your wealth. You're only digging a deeper hole if you waste money on cash value plans since it robs you of the ability to make real progress. And that's why I send you to Zander Insurance, and I have for 20 years. That's where I get all my insurance, and they only offer the plans I recommend. It is not expensive. It's not complicated.

And Zander will be there as your guide every step of the way. Visit Zander.com or call 800-356-4282. You need to get this taken care of. I can give you the advice, and I can tell you where to go, but it's really up to you to take that important step to get your family protected. That's zander.com or 800-356-4282. Thank you for joining us, America. We're glad you are here. Katie is in Baltimore.

Hi, Katie. Welcome to The Dave Ramsey Show. Hi. Thank you. Thanks for taking my call. Sure. What's up? Well, I'm trying to figure out, my husband and I are trying to figure out if we should pay off our house.

We're in baby steps four, five, and six, thanks to your program. And my husband just turned 60 last month. So we are wondering if we should, now that he can access his retirement savings, we're wondering, and he probably has five to ten more years, God willing, to work, but we're wondering if we should take from his retirement savings to pay the house off. How much is in your retirement nest egg? About $330 plus an additional

$140 in pensions. Okay, and that will be rolled over into IRAs when he retires. Yeah, I guess. Yeah, that's what I would do. That's what you do, okay. But not until he retires. So what's your mortgage balance? We owe $182 on the house.

Okay. So I know it would take our pension way down it's not your pension it would take our retirement down to like 150 yeah um and what's his what's your household income um we make um just under 200 000, I would pay it off. You would? Yeah, you've got such a great income that with no house payment, you're going to be able to max out all your retirements and invest heavily. And you're going to have money back piled up like nobody's business.

What's the home worth? What's the home worth? Probably $275,000. Okay, all right, good. What's the home worth? Probably $275. Okay. All right. Good. Yeah. So we currently pay a lot for his, like through work, we pay a lot for his life insurance because he has diabetes and sleep apnea.

So we have very little outside of work. So that's another reason I kind of am wanting to do it. Yeah. Yeah. And here's the other thing. You know, once you reach a point that with the house paid for, that there's enough of a nest egg, that if he were to pass away, you would be financially okay, that's the point that you're self-insured and you would drop that life insurance.

Okay. Since you're paying a lot for it, especially. Yeah. So once you have enough of a nest egg upon his death with a paid-for house for you to be okay, at that point, that's called self-insured. Okay. Now, he's turning 60. He just turned 60 last month.

So with those two chronic issues, do we still start the long-term care insurance, or will that be exorbitant and we pursue being self-insured? No, I would make sure you had long-term care insurance. You still would, no matter how much it costs? Well, not no matter how much it costs, but I would look at it very, very strongly. I mean, I don't know what the expense is going to be based on that. But, you know, the problem is if he goes into a nursing home, you've got $100,000 laying there in a paid-for house.

That's not going to leave you in a good situation. You need that nursing home to be covered today. Now, again, you look up five, ten years from now, and you've got a million dollars, which you should have in investments with a paid-for house, and your net worth's approaching a million and a half, if you want to self-insure at that point through a nursing home stay and drop that, that would be fine. And somewhere along the way, you would have dropped your life insurance, too, which would also help pay for that then that would be fine but the point is

if you think about the event occurring whether it's death or a nursing home stay where does that leave you and today in neither case does it leave you great it leaves you good but not great so only time we drop the insurances or when we're in great mode. So today I pay off the house, A. B, I'm only doing that if I'm firmly committed to building this next egg really, really rapidly using this fabulous income that you have. And C, you keep the life insurance in place for today. And D, you put your long-term care insurance in place today. And then we drop the life insurance as soon as there's enough money to cover upon his death.

And then later on, if you've got enough piled up and you want to drop the self-insure through the long-term care insurance later, through the nursing home stay, later you could do that. But that's probably out there a decade or so away. You're probably buying that for about 10 years before you can get there with the numbers you're giving me. But you're doing really, really good. Very well done. Let me give you a copy of Chris Hogan's book. It will guide you through this process.

It's called Retire Inspired. Number one best-selling book. So hold on. I'm going to send you a copy. Amanda is with us in Oklahoma City. Hi, Amanda. How are you? I'm doing great. How are you doing, doing dave better than i deserve what's up in your world hey okay so my husband and i are 25 years old and the only non-mortgage debt we have is a student loan payment or a student loan of about

fourteen thousand dollars good we have yeah i'm We have $27,000 in our savings now. Pay it off. So you would say pay it off completely. Today. Today. Okay. Yeah, it's real easy. And you got $13,000 and you have no debt. And you're 25 years old. Yeah. And your household income is what? About $40,000. Awesome. So would you say, okay, so we would still have a mortgage, house debt. Yeah. Would you say put the rest of that towards the house?

Nope. Or keep that as an emergency? No, you need an emergency. Baby step one is save $1,000. You've done that. Baby step two is use everything above $1,000 and become debt-free except your mortgage. That's what I just did. Baby step three is a fully funded emergency fund,

raising your $1,000 account up to three to six months of expenses. I think that's $13,000. Yeah. That's your emergency fund. You don't touch that for anything, anything. You do not buy stuff with that money okay it's there for a rainy day if you want to if you want to buy some stuff you got to save up beyond that if you want to buy a car you want to buy a couch you want to go on christmas or go on a vacation

you got to save up above that 13 000 in a separate account that money you don't touch okay and then we move on to baby step, which is we start investing now to become wealthy. So you would start investing before the house is paid off and after all the rest of the debt is paid off. Yes, what we call baby step four is 15% goes into retirement. And then above that, any money you can scrape out of your budget, you put towards the house and pay off the house. Okay. And you work your way that way. The is it what we call baby step six hold on i'm going to give you a copy of the book outlining all of this it's called the total money makeover but you need to be debt free by the end of business today hold on i'll have kelly pick up and we're going to give you a copy of that open phones at 888-825-5225.

Rasheed is on Twitter following me, at Dave Ramsey, 800 and something thousand of you do. Thank you for hanging out with me. I have a 12-year-old house. Should I get a homeowner's warranty? No. No, you never buy extended warranties on cars, electronics, or houses. Here's why.

Eighty-seven percent of what goes out the door on a warranty goes to cover overhead and profit and commissions. Only 12 to 13 percent of what you pay actually goes to cover the statistical probability of the breakdown. That's the averages. These things are almost all profit and commission to the person selling them. Extended warranties at Best Buy, rip off. Extended warranties at the other electronic stores, rip off. Extended warranties at the used car lot, rip off. Extended warranties on a home, rip off extended warranties at the used car lot rip off extended warranties on a home rip off they don't work the math does not work it is not a good buy you are better off to take that

12 risk on that item and self-insure through that by having a good emergency fund as a result of having not paid out all your stinking money to extended warranties you can buy an extended warranty on a freaking pencil at best buy they put an extended warranty on anything they'll put one on you if you walk through the line it's unbelievable no it's a good place to buy electronics they got good prices but no extended warranties no extended warranties. No extended warranties on your homes, your cars, your electronics. Bad math. Bad math.

Hope I wasn't unclear. This is the Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries, or CHM, helps Christian families, churches, and ministries join together as the body of Christ to share their major health care costs. Christian Health Care Ministries is the original health cost-sharing ministry, a Better Business Bureau-accredited organization CHM

members share to pay each other's medical bills. It's not insurance. It's Christians financially and spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years. And our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org In the lobby of Ramsey Solutions, Eric and Anastasia are with us.

Hey, guys. How are you? We're good, Dave. Doing wonderful. Good. Where do you guys live? St. Louis, Missouri. All right.

Welcome to Nashville. Good to have you. And you're here to do a debt-free screen. Yes. Yes. Welcome to Nashville. Good to have you. And you're here to do a debt-free scream. Yes. I love it. How much have you paid off? $275,000. Whoa. And how long did that take? Nine years, nine months, and seven days. Nine years, nine months, and seven days. And your range of income during that time? We started out at $78,000, and now we're up to $110,000. Way to go. What do you guys do for a living?

Well, I'm an engineer. Work for Boeing on aircraft subsystems. Yeah. And Anastasia's a nurse. Very cool. So I'm guessing with that large amount of debt and the nine years, that that means your house is paid off. Yes.

Way to go, guys. I'm looking at weird people. You have a paid-for house. Yes. Wow. What's this house worth? About $300,000. Boom. Look at you. How old are you two? 26. 30 is 36. Sorry. I just cut 10 years off your age. Well, that's what getting out of debt does. It just makes you younger. I'm just saying. It knocks 10 years off of your birthday. That's what it does. It does, man. You get the 10 years you spent back right there.

Just that's perfect. Look at you guys. That's awesome, man. Very, very cool. So tell me the story. What's this journey like? How'd you get on this plan to get out of debt? We started, it was offered as an adult Sunday school at church.

And I went just thinking, it's adult Sunday school, that's what you do. Financial Peace University? Yeah, Financial Peace University, when it was still the 13-week class. Yeah. I was pregnant with our oldest at the time, and we caught the vision of what could happen if we paid off all of our debt. Eric was a little bit more intentional when he went.

Yeah. Well, he when he went. Yeah. Well, he's an engineer. So we were expecting Ruben, and he was supposed to be born sometime in the middle of that class. And so we said, hey, our finances are fine, but maybe we can pick up something. This kid's coming along the way. Finances are going to change somehow.

Maybe we can learn something. But it completely changed our life instead of just giving us a tip or two. Wow. At that point, our goal with our Discover card was to try to keep it under $1,000 a month, and we almost never made it. We paid it off every month,

but we were frustrated that we couldn't figure out what to do. And you offered us a system, and we love that system, and that's what we do. Wow. Good for you. Did you have other debt when you started other than the house? Yes. We had student loans, $60,000 between the two of us.

Okay. So you knocked that out and knocked the house out. Right. And that's the total of the $275,000? Yes. Okay. Wow. Very, very cool.

Congratulations, you guys. Thank you. Did you have any inkling all those years ago, you're sitting in that class pregnant, that you're going to be standing here less than 10 years later with your house paid for? It was hard to imagine that far out. We could see the 20 months. We thought it was going to take a little longer, but the first 20 months for step two, we could see that. But we couldn't see the end until much later.

Yeah. But you just took step, step, step, step, step. Wow. So what do you tell people the key to getting out of debt is? You did it. I wrote it out so that I wouldn't. I think it's, I also homeschool our kids. And so it's the ABCDs.

You always budget, always communicate, and you have to dream. And while we have to dream. And while we have to stay consistent on the basics of budgeting and communicating, dreaming about our long-term goals helps keep us motivated. We also dreamed backwards. We looked at our ongoing progress, whether marking how many months a principal-only payment made or how much we were able to give last year. That's good. You know, we did that because we were in such a deep hole that we had to go back and go,

okay, it feels like we got a long way to go, but look how far we've come. Yeah. And if you look backwards, you go, look how far we've come. Look how much we've done. So that gives you, you know, it's almost like, you know, when you're running a half marathon, you got, you know, a 13 mile run and you're like, ah, it's mile nine. Yeah, but I've done nine miles. You know, I've only got three to go or four to go.

I can do this. Yeah, so that look back is smart. That's very good. I like that insight. Very, very cool. Very good. How does it feel? It feels great.

I mean, because when we started this, I mean, about the same time or several years ago, I mean, we had also read things like Millionaire Next Door. And being in debt, reading that and hearing what he has to say, you look at it and say, okay, he labels people. Are you an under-accumulator of wealth? Are you an average accumulator of wealth? Or are you prodigious? And you fall into the bottom category when you've got debt. And you say, wait a minute.

That doesn't feel like where we're at, where we should be at. Yeah. So that, along with, after you get over the negative net worth, looking forward to where you could be. Yeah. And like Anastasia said, keeping track of it ways and seeing what your progress is, it can be a big motivator after you start saying and realizing that you have the ability to change your life and to completely change the financial situation of your family. Yeah.

Well, I mean, you're 36. You have no payments. Yeah, that's right. You have no payment in the world. Yeah. You've changed your life. Yeah. You've changed your family tree.

Mm-hmm. Very cool. And so you have how many kids now? Because Reuben was born, you said, that year. Correct. We have four kids. Okay. And their names and ages.

So Reuben's 10, Heidi's 7, Brielle is 5, and Kaisa is 3. Wow. So have they been practicing their debt-free scream? They have. In fact, when we were practicing at home, and Kaisa, we were watching the videos to kind of make sure we knew what we were doing. And she'd say, Mommy, those people are debt-free just like us. Oh, there you go. That's exactly how it works.

Well, that's pretty cool. Because, you know, what happens is this whole thing of doing a debt-free scream, it's kind of silly in a way. But it's also very much of a milestone. It marks, viscerally marks, in your marriage, in your future, but also in these kids' minds. I mean, they may not remember anything else, but they may be 30 years old someday, and they go, I remember going to that weird guy's office and screaming when Mom and Daddy paid off their house, you know? And you remember stuff like that from childhood.

It does change your family tree. You guys are so impressive. I'm so proud of you. Very well done. Rock stars, man. Thank you. Well done. We've got a copy of Chris Hogan's book, Retire Inspired, for you.

That's a number one bestseller, and that is the next step. That millionaire next door status, right? We're heading that way now, and that's the next chapter in your story. So keep at it. You've lived like no one else. Now let's live and give like no one else. You're in a position to do that. Very, very well done. And check out his podcast from time to time, too. He'll keep live and give like no one else. You're in a position to do that. Very, very well done.

And check out his podcast from time to time too. He'll keep you motivated with that voice of his. So, all right. It's Eric and Anastasia. Ruben, Heidi, Briella, and Kajia.

I probably messed up all your names. St. Louis, $275,000 paid off in nine years and nine months, making $78,000 to $110,000. Count it down. and nine months, making $78,000 to $110,000. Count it down.

Let's hear a debt-free scream. Three, two, one. We're debt-free! Woo! Way to go, you guys. Very well done. Boom! The house and everything.

Oh, man. That! The house and everything. Ah, man. That's how you do it. You're looking at regular people right there doing what it takes to win. There's no Superman capes over there. No Superwoman capes over there. I looked. They weren't wearing a cape. It was an engineer and a nurse.

Nine years. Nine years. Nine months. Seven days. But you're going to live the next nine years, nine months, and seven days doing something. Why don't you make it count? Why don't you do it on purpose? It seems like every time I turn on the television, somebody's a victim.

And some of that's really, really sad. Really sad victims. I don't want to be a victim. Sometimes you're a victim, it's not your fault. I'm not saying it's your fault when you're a victim, but when it comes to your finances, you're not a victim. Except of your own stupidity. I was a victim of my own stupidity.

Lots of people have been. But you can decide to change. Ding, ding. Just like that. Gonna change. Just like that. Change. That's how you do it.

And then you come on here and you scream, I'm debt free. It's a way to become wealthy. It's a way to be more generous. It's a way to change your children's and your grandchildren's lives. You've got to do it on purpose, though. It doesn't accidentally happen. This is the Dave Ramsey Show. Thank you for joining us, America.

Katrina is with us in Connecticut. Hi, Katrina. How are you? I'm doing great, Dave. Thanks so much for taking my call. My pleasure. How can I help? All right. So I'm a new listener.

Currently, I am debt-free. I just increased my Roth 401k up to 15% and working on some savings. Good for you. But in April, I'm getting married. Yay! And he has... I'm so excited. But with that comes about $ thousand dollars in debt so my question is should we kind of go back to step two during my savings down to about a thousand and tack that debt and also what i should do about my 401k okay um the date in april is set is that right yep okay and he's on the same

page that he's going to pay this off as quickly as he possibly can before during and after marriage i'm sorry what was that i'm sorry before during after marriage, he's on the same page as you that he's going to pay this off, we're going to pay this off as fast as we possibly can. Correct. Okay. As long as you're on the same page on that, then everything's fine. I don't see any issue at all. I would just say from now to April is not that long.

If I were in your shoes, I would go ahead and stop the 401K, pretend like you're in baby step two, only don't pay his debts. Let's just have you pile up a big pile of cash. And when you get home from the honeymoon, you guys take all the cash that you've got and throw it at this debt, and you're officially in Baby Step 2. You've got $1,000 saved, and you're officially in Baby Step 2. And as fast as you get that paid off, then you finish your household emergency fund, your new couple emergency fund, married emergency fund, up to three to six months of expenses as baby step three.

Then baby step four is you both start putting 15% away, where 15% of your household income is going aside for retirement. But between now and April is not that long. You're not going to gain enough ground. I would rather you build up cash and just, again, when you come back from the honeymoon, let's go ahead and attack, you know, as if you had paid on his debt. But I definitely do not want you to pay on his debt until the ring is, the final ring is on your finger and you're back from the honeymoon.

But once that happens, then yeah, and now you are one, the old preacher said. He said, and now you are one. He does not present you as a joint venture. He says, and now you are one. You are unified when you're married. And so we, you change your words from mine, my debt, his debt. It's now our debt. My money, his money. It's now our money.

We change our pronouns. You become French, we, we. And use lots of pronouns that indicate that you are one. James is with us in Phoenix. Hi, James. How are you? Hey, Dave. We appreciate your financial and spiritual advice.

How's life? Better than I deserve, sir. How can I help? Hey, just a quick background. We have a few retirement accounts, a couple state retirements, 457, some hard cash, paid for rentals, we're debt-free. Wow, way to go. Yeah, we paid off about a quarter of a million in four years. Wow.

And I bought into a Roth just recently, kind of a legacy account to leave for other people later on if we don't use it. And I got into the Vanguard 500 500 the low cost index and my question is we're getting ready to sign my wife up for an additional roth and do we go with the same fund that i like or do we diversify and go a little bit direct different direction in that roth account truthfully as small an amount as it is compared to your overall net worth it probably doesn't matter um and for convenience i'm probably going to throw them in the same one and the vanguard s&p is a fine fun there's nothing wrong with it at all um you know i i generally tell folks uh if you're going to do your overall investing in your retirement to spread it across four types that beat the s&p growth growth and income growth, and international and select funds that are outperforming the S&P.

But there's nothing wrong, especially with your mix and your portfolio. You guys have done so well. I mean, it's a multimillion-dollar net worth, it sounds like. And, you know, if you want to just park it in an S&P, there's nothing wrong with that at all. And as you said, it's a legacy account. You've got a very predictable environment if you do that, you know, what you're getting into. So nothing wrong with that at all.

Nothing wrong. Probably for simplicity's sake, I'm going to dump it in the same fund just so I don't have to mess with trying to remember, you know, I've got $5,000 over here, $6,000 over here. You know, and, you know, and, yeah, I'll do it again next year and the next year and the next year. But still, it's not going to end up it's never going to be a high percentage of your overall net worth and so i just like to think keeping things real simple and real clean i don't want 62 different mutual fund accounts coming to my house driving nuts bethany is with me in tulsa oklahoma hi, Bethany. How are you? Try again. Push the button again, Dave.

One more time. Let me try. All right. Try this. Now, how's that, Bethany? Can you hear me? Better than I deserve. I'm learning to operate the phones for the first time in 25 years.

How can I help? Well, I'm a longtime listener. My husband and I did FPU back in 2014, and then we relocated from the East Coast to Tulsa, Oklahoma in 2015, but we're just not on the same page yet. We're still struggling through Baby Step 1, and I really wanted to get your advice on a situation that we have now. My husband borrowed from his 401K this year to buy a car in cash, and he's defaulted on that loan.

I know that's going to be a huge tax implication for us. When we relocated from the East Coast, we had to short sale our house because the properties there just wasn't worth what we owed on it. So we have been renting since we moved here, so we don't have that tax plus anymore. Our oldest is now over 18, so he's not considered a dependent anymore. So we just don't have as many pluses on the tax side as we used to. He has a business. He's been in business for 20 years as a DJ.

But, of course, moving 1,200 miles away, the clientele is the same. I don't think you have a tax problem. Do you? I know. The problem is you and your husband are not on the same page, and he continues to do stupid butt stuff with money. Well, it was something that we had talked about together. That doesn't make it smart.

Yeah. Borrowing on a 401K to buy a car after you went through Financial Peace University? Sounds like you flunked the class. Well, I know for myself, I've been doing our taxes for the last 15 years. Like, I know the facts and figures and what we need to do. It just doesn't seem to move on to that next step. Yeah, like you don't do it. Yeah, yeah, you're right.

You're right. I know this past year when I did our taxes, he flew back to the East Coast to do two or three weddings. So we ended up having about an $11,000 loss on the business. And I know this year... So he took gigs that he lost money on? Well, between the flights... He took gigs that he lost money on?

In the end, between... Because we've been trying to do a lot of advertising since we've gotten here. He took gigs that he lost money on. I guess it probably broke even. Most of them were for friends. If he broke even, then it didn't help on taxes. I know, I know. Okay, so I'm sorry.

You keep trying to go back to taxes like that's the problem of what's going on. And what this is is you're a math person like me, and for years, Bethany, I tried to fix behavior problems with math, and I gave up. I figured out the problem with my money is that Sharon, my wife, and I have to be on the same page. We have to be living God's ways of handling money, Grandma's ways of handling money, and that has to do with controlling the person in my mirror. Your husband is more like me in another way

in that he is self-employed, and oftentimes those of us who are self-employed are good salesmen, and we think we can out-earn our stupidity, and he can't. Stupidity will catch you and tackle you. So the two of you have got to sit down together. You need to go back through Financial Peace University, and this time you need to submit yourself to the systems and the processes

and the principles that have helped millions of people, and quit dodging and acting like this is a tax thing. It's not a tax thing, kiddo. It's a behavior thing. Hey guys, this is James Childs, producer of The Dave Ramsey Show. I'm excited to announce that we're now carried on 600 radio stations across the country. To find one near you, head to DaveRamsey.com slash show.