The Ramsey Show - App - You CAN Break the Cycle of Debt Holding You Back (Hour 1)

Episode Date: January 11, 2024

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. The phone number here is 888-825-5225. Jade Walsh, our Ramsey personality. Best-selling author is my co-host. We're glad to have you with us today. Chase is going to start this day off in Jacksonville, Florida. Hi, Chase. How are you?

Hey, I'm good, Dave. How are you guys? Better than I deserve. What's up? Me and my wife recently started doing your baby steps here on New Year's. I got your book, Total Money Makeover. We added everything up and mortgage included. We have like $405,000 in debt currently because we recently bought a house. We make like $146,000 salary combined. And I'm just wondering if that seems doable, normal, like taking the normal path, or do you think

we have to do something drastic? Well, how much of the debt is your mortgage? About $329,000. Okay. Yeah. So the way we teach, at first we're just handling all the debt except the mortgage. So I think if for the time being you kind of set the mortgage on the shelf and don't be concerned with that, just look at the other bit of debt that you've got, the other $70,000 that's here, that's what I'd be concerned about. And with your income, I think it's just as simple as getting on a budget and figuring out how much you can put towards this every month. Does that look like extra side hustles? I think right now you're overwhelmed because you're adding the mortgage into it. Is that fair? Right. Yeah. How far into the total money makeover book are you? A couple chapters, but I've been listening to your show for okay so well baby

step you know baby step one is save a thousand dollars when you get there two is to do what jade is saying and that's pay off your debts everything but your house smallest to largest and you've got seventy six thousand dollars of that and you make a hundred and forty six thousand and so technically speaking if you were to live on 70 000 not counting taxes you'd be debt free in one year i like that but you want you you do have taxes and you might not do that so it might take you two years but much less than two years you should be debt free except your mortgage and baby step two um could i ask you a follow-up question on the mortgage payment um so they so i have pmi on this do you do you ever um would you ever advise anyone to quickly pay down

as much as they can to get the pmi taken off to free up some extra or just strictly keep that on the back burner until you get some extra or just strictly keep that on the back burner until you get i mean technically i would keep it on the back burner yeah i put it in baby step six here's the thing if you're if you're out of baby step two in 18 months and you do take another six months to finish your emergency fund then you're going to start doing four or five and six simultaneously so i mean we're talking two years or something you're going to start doing four five and six simultaneously so i mean we're talking two years or something you're going to start to attack your mortgage so that's going to get rid of the pmi faster than it would if you screw around with all this stuff at one time that's right

so no i i think you just sit there and pay the mortgage enjoy the house and work your tail end off and live on nothing you better really enjoy the house because you don't need to leave it you don't need to go out to eat you don't really enjoy the house because you don't need to leave it. You don't need to go out to eat. You don't need to go on vacation. You don't need to be doing anything. You need to be attacking this $76,000 of other debt and deciding if you have a car you need to sell or not and just attack, attack, attack, attack, attack, right?

You know, he read the Total Money Makeover. He got excited about what he read. And the key is get excited. Like you do start feeling the weight of the debt but don't let it cause you to go in the wrong direction and go in the opposite directions of what the steps are teaching do you know what i'm saying yeah like he i could tell he's excited but just follow the steps yeah it's the fastest way at the end of the story the fastest way to building wealth is to follow these baby steps and it's not

like we just made this stuff up in a think tank somewhere i mean we've sold 10 million total money makeover books we've had 10 million people go through financial peace university all of that is the baby steps some of those are the same person some of them bought more than one book and so forth but it's not it's not necessarily 20 million people but my goodness a lot of folks have done this stuff and have become millionaires we call those baby steps millionaires luke is in cleveland ohio luke welcome to the ramsey show hi dave thank you for having me sure what's up um so i'm a 19 year old in college and i have some student loans um not too worried about them. I have no debt. And I was basically kind of wondering where,

what you would recommend me to do to either avoid student loans or pay off the few student loans that I have and then post-student loans to just build my wealth. Where are you going to school? Ohio Wesleyan University in Columbus area. And what's that cost you so far in student loans? How much have you taken out so far? I would say about $6,000 max. Okay. And is that per semester? That's for the past three semesters that I've been there okay so yeah so it's nothing that's nothing exponential so so work 40 to 60 hours a week and pay for school

okay um so my plan after college is to um go to med school so i know that's a big uh uh builds a lot of debt and obviously student loans so no not obviously well i think you have to change your mindset because to answer the core of your question how to go to school without student loans is you go to school without student loans so you have to take that off the table and i can tell by the way you're talking in the words that you're using that in your mind somewhere it's still an option and in some somewhere in your mind somewhere, it's still an option. And in some somewhere in your mind, it's still kind of like the only and best option. And you've really got to change that. So if I'm you, first and foremost, I'm going to finish undergrad, like Dave said, I'm paying my way through. And then you need to start researching programs that will pay for your school as you're

going to school. And you need to start researching programs where you can get your degree. And maybe you're not going to that top dollar state school, Maybe you're going to a smaller school that's less expensive. So just do your due diligence on this. And there's things called MD, PhD programs where you can actually go to work for the university and then your tuition's free while you're studying for MD. There's this neat thing called the military and they will pay for it and you will serve them for a while and serve your country in other words there are ways to go through and become a doctor there are even some of the hospitals now that are paying for it because but of course you're going to promise to work there for a period of years afterwards but that's a great trade they're going to pay

you when you work there so you want to look at these things and start poking around on those things look be very careful of your language out of the abundance of the heart the mouth speaks that's a bible scripture okay and earlier you said i don't have any debt and then you said i have student loans which means that you don't even think student loans are debt right Right. And I do think they're debt. As a matter of fact, I'm really sure they're debt, and you need to avoid them. And I appreciate your call. Kind of hard to be on a radio show. It's being nervous. You can say things, but I understand.

No, you're right. You're right. But, you know, you want to be real careful to choose to avoid this. And, okay, I've got a new goal. In addition to going to med school, I'm going to med school debt free. Ooh, that's a cool goal. Hey man, thanks for being a listener. This is the Ramsey Show. Jade Walsh, our Ramsey personality is my co-host today. Wow. Wow, wow. Thank you guys. You're amazing out there. So let me ask you a question before I tell you why you're amazing. What percent of Americans say their personal

finances have a negative impact on their mental health? 49% of Americans say their finances have a negative impact on their mental health. A jump from the previous quarter, and two in five Americans have experienced anxiety attacks due to money stress. Money stress is real, and you know what? What happens is we get stuck. We just keep doing the same stupid thing over and over again, expect a different result, which is the definition of insanity. We know that, and if you want to get something you've never gotten you got to do something you've never done we know that so you got to break the cycle right because stupid has a gravitational pull it'll hold you in its orbit you can just get stuck circling stupid and the only way you can get out of that stupid orbit

is to expend energy that's how you break an orbit you have to fire all the rockets and break away yeah so we're going to help you break the cycle and man are we doing it big time this is what the thank you is for so we start telling you guys about this free live stream that jade and i are doing tonight along with dr john deloney rachel cruz and george camel and now over 400 000 of you that's the that's the biggest one we've ever done wow i've signed up to watch tonight thank you wow i hope you actually watch because if you watch someone 10 of you out of 400 000 the odds aren't real good but 10 of you are going to win a thousand dollars each we're going to give away ten thousand dollars to people actually viewing come on the

event tonight. And you can still come and watch it and still be one of those 10 possibly, but it's going to be great. I mean, we've been walking through the content pieces and with what Rachel and Jade are doing around every dollar, what George is doing around the ripoffs that are out there and Dr. Deloney is doing around the anxiety issues and me just stirring up trouble, which is like my spiritual gift. So, hey, come and join us. We'd love to have you go to RamseySolutions.com slash break the cycle.

And you can register and watch this live event live stream tonight. It's at 7 p.m. Central Time, Thursday the 11th, for those of you tuning in at whatever time you tune in. So however this works in your world. So a lot of people are live on our YouTube feed. A lot of people are live on some of our other feeds. And then, of course, there's a bazillion of you on podcasts, and they'll hear the show later. So you may just have FOMO on this. But we would love to have you it's going to be incredible we're very proud of what's going to happen tonight we are going to help you really we've been doing it for 30 years we're going to help you break the cycle

and break that orbit around stupid Aisha is with us in Atlanta hi Hi, Aisha. Welcome to the Ramsey Show. Hey, Dave. Hey, Dave. Pretty close. It's pronounced Alicia. Oh, I'm so sorry. They had it correct on my screen, and I screwed it up. I'm kind of legendary for screwing up names.

What's up? How can I help? Okay, so I'm recently into real estate. I got my license back in April. I sold my first half a million within my first six months. I'm very proud of that. And I'm finding a hard time getting buyers to their pre-approved status while trying to help them get out of debt. And I'm trying to work with, you know, lenders and everything like that. So I was trying to help them get out of debt. And I'm trying to work with, you know, lenders and everything like that. So I was trying to figure out, pick your brain, the best way to look at, you know, gaining more clientele

and encouraging them when they're ready to buy. Good job. That's awesome that you're even thinking about it like that. Yeah, well done yeah well done well done so we teach people to not buy until you are debt free and have your emergency fund in place so don't don't send them to us if you want them to buy while they've got debt because we're going to mess up your sale true that so um first thing but but the uh but if they're if they're going to go that route, the thing is this. Generally, let's just say, how do I talk to someone about a difficult subject like money or getting out of debt?

Don't talk to them about them. Talk to them about your story. Just say, I don't know about you, but a lot of people are like me. And I had this and this. I had this debt. I did this stupid thing. And I struggled this way. And it was hard for me.

And me and my husband fought about money. And whatever the truth story is about the times that you made a mistake and screwed up. And then you say, but I changed because I started seeing the value of not having any payments. And I worked my tail end off, and I sold stuff, and it took me a certain amount of time, and now I am debt free. It's your story. Your story is an encouragement, and your story is not shaming to others so uh i could lose about 20 25 pounds right now it'd be good for me uh telling me i'm fat is probably not going to motivate me but i ran into one of the guys working here tim have you seen tim yeah tim has lost like he was a big old boy he

lost like 100 pounds. He lost a backstreet boy. I mean, he looks like a completely different person. And just seeing Tim motivates me. Then I talk to Tim about his story. It motivates me. But it's not Tim coming up and going, you know, Dave. You know, Dave.

You could lose a few pounds. You could really. You fit better behind that old desk over there, you know? And so that's the thing. I think that works really good with a lot of ways to convert a lot of people to a lot of things. Absolutely. I like talking to people about Jesus, but I don't want to beat them over the head with a Bible. I talk about what Jesus did for me.

Yeah. Then you're talking to them. You're not talking at them. And you're not kind of putting yourself in a higher position, right? Yeah. You don't want to talk down to people. Although Tim could do that because Tim's also tall. But anyway.

But yeah, you're right. You're right. That's a big thing. Because this subject is not unlike being fat. It's a shaming. Very sensitive. It's a shaming. It has a lot of condemnation with it and those kinds of things

and so you've got to just be real careful to not wag your finger in any way and i go well you know if you'd quit doing that stupid stuff now when people call here it's different because they're asking us they called our phone if you ask me now i've got to tell you because that's like my job right yeah you called the number yeah you dialed it up baby so don't don't call here and ask for our opinion because we'll give it to you we are experts on our opinion you know but the uh but but do you know when you're dealing with your friends and relatives and things i don't i wouldn't go in there talking about their stuff at all i would just talk about you and just go i don't know if this helps you or not, but when I was facing a thing like this and, you know, that helps to just not, you know, kind of pull yourself

back a little bit. I think so, especially when you're in a position like her, they trust her to a certain degree because they chose her as the realtor. So she's already has that position of trust. And I think you're right. If you choose your words carefully, you can grow that with them but the moment you kind of like you said start wagging your finger then it starts to dissipate and you start to lose your footing with that person so it is very important how you approach uh subjects like money and weight loss well i mean

anything religion anything you want to talk about yeah Yeah. I mean, you know, nobody has ever been, had their mind changed by someone just randomly starting to yell at them. I mean, it's like. No. As if that works on the internet, too. It doesn't work. Yeah. I mean, like, you know, all these 47,000 haters, they changed my life.

You know? Not at all. They didn't change my life at all. I don't even know they're there. Right. You know, that's it. So, that's the whole process. Jade Walsh, all Ramsey Personality, is my co-host today.

Her quick read has sold out, and we're just getting some new ones in. That's right. So you can get the Money's Not a Math Problem, the real reason you're broke and what to do about it. And that has to do with just exactly what we're talking about. Yeah, definitely. The person in your mirror. The man in the mirror, Michael Jackson said it best.

I mean, most of us, Dave Dave we have this ticker tape you ever watch the news and there's that ticker tape that's rolling in the background that's telling you what's going on most of us have that in our minds and it's affecting our actions our behavior and we're not really aware of it until we take the time to stop and read it and understand okay this is what I've been thinking this whole time that's why I'm behaving this way. So that book is all about addressing your belief system and changing the beliefs that are untrue and not serving you. There you go. Money's not a math problem with Jade Warshaw. You'll enjoy it. I promise. This is The Ramsey Show. jade washall ramsey personality is my co-host today thank you for joining us michael and jill are on the debt free stage hey guys how are you good doing great good good to have you guys

welcome where do you live phoenix arizona oh fun welcome to nashville thank you and how much debt have you paid off five hundred and seventy thousand dollars oh that's all wow and how long did that take 45 months or 1373 days that's i love it and uh your range of income during that 1373 days uh 170 to over 200 nice good for you guys what y'all do for a living? I'm in law enforcement. I'm a director of administration at Howe Realty. Ah, very good. Good for you guys. And what kind of debt, pray tell, was $570,000? It was the house we lived in with our two kids. Yay!

Looking at weird people! Love it. That's beautiful. Very cool. A paid-for house house what is this house worth about 800 000 let's go love it and how much in your nest eggs uh just over a million come on a little bit more all right it's a million eight net worth baby steps millionaires yes sir way to go you two that's awesome law enforcement and administration two there we go and that's how

we did it so way to go you guys how old are y'all I'm in my early 50s. I'm in my mid 40s. Amazing. Very cool. And debt-free and millionaires. Yes, sir. All because of you. Man, I didn't pay any of it. You guys are heroes. We've been following you for 23 years. Wow. Okay. Well, tell us the story. What happened 45 months ago that made the house get in the gun sites sure well uh i didn't want to move but she wanted to move and i said okay if we're going to move to a new house we're going to pay it off in five years and we did it in three years and nine months and uh we've been debt free for years like she said but and we've been following you for years but you know the mortgage was always the the big last hurdle and we just buckled down and spent

two-thirds of our income uh on the house more on the mortgage we sold some stuff i sold my 69 mustang fastback yeah um we sold some guns we did some sold some stuff and uh just been all our almost two-thirds of our income on the mortgage so wait a minute you bought the house three three years and nine months ago and paid it off in three years and nine months yes ma'am holy moly years and nine months. Yes, ma'am. Holy moly. Wow. Yep. Wow. But that was the deal.

That was the deal. That was the deal. I'm not moving unless we're paying it off. Right. Yeah. I'm shook. That's amazing. So, Jill, he comes in with this deal and you just said game on?

I did. Yes. I want the house game on. Game on. We're going to live on nothing and we're going to be done. Yes, sir. And not even four years later. Correct. You do the five-year goal.

Amazing. Wow. Beans and rice, rice and beans for the house be done. Yes, sir. And not even four years later. Correct. You do the five-year goal. Amazing. Wow. Beans and rice, rice and beans for the house. Yep. Yes. Hey, okay. Yeah, but we're worth a million eight and the house is paid for.

Listen, I'm not mad at it. In freaking Phoenix, which is an incredibly good real estate market. Way to go, y'all. Thank you. How's it feel? Feels great. Feels great.

I'm very proud. Stress-free. Yeah. Liberating. Yeah, liberating for sure. I want to brag about it a little bit too yeah go on and do it yeah it's a good place to do it we like bragging here it wasn't easy but it was definitely definitely worth it yeah i tell you to take your shoes off and walk through the grass in the backyard but it'd be sand that's right oh my gosh you guys i'm so proud of you thank you way to go way to go what do you tell

people the key to doing something like this is because that's a pretty bizarre move budget budgeting teamwork teamwork communication sacrifice yeah yes wow you realized at some point um maybe even before this and just applied the principle that the biggest thing standing between someone and hitting their goals is not what they have to do to get there it's what they have to give up to get there yes so the guns the fastback mustang i mean like i want this goal yes with this goal to the exclusion of other things yes bringing my work uh bringing my lunch to work every day making my own coffee doing my own nails every Sunday not getting my hair done professionally she does the landscaping I do the landscaping I kill the bugs

you know I kill the weeds we do all those things we can so we don't have to pay someone else to do it and we're not very handy so it's usually take for yourself I'm pretty handy she's pretty handy that's an adventure wow you know I did that I started doing my own hair It looks like Doesn't it look like it Well It looks like it Shut up Jay

Just shut up You lost a few strands Dave Missed a spot Yeah Missed a spot You guys Man that's powerful So what

Very cool Now what's the first big thing You're going to do with money To enjoy it Yes Now that this is here? Well, we bought a hot tub. Yes. Yeah, there we go. We bought a hot tub.

That's a good one. And we're going to the Caribbean with some friends. Nice. That's a good one. In a couple of months. And we're going to take our kids on a cruise this summer. Nice. Because they've sacrificed a lot, too.

They have. I like it. Wow. Living like no one else. Steven and Emily have definitely been our big cheerleaders as well and helped. How old are they? 20 and 18. Oh, perfect.

So they got to watch mom and dad do something hard. Yes. Up close and personal. Yes. It's crazy. They have all the baby steps memorized. They've definitely been indoctrinated. Both of them work at Chick-fil-A.

And they have more in their bank accounts now saved than I did when I was 30 before we got married. And now 20. At 20 and 18. Yes sir. Wow. Wow. Hey can you speak to because the housing market has people up on end right and I'm looking at okay $570,000 house you said you're in your 50s. No no that was the mortgage $800,000 house. Well now it's worth $800,000 right? Oh wow. So speak to people who are frustrated by the housing market. They're in their mid twenties and they feel like they need to have the house today. And it's, it's too expensive for them. Talk to them from your perspective of what this journey looks like. Well, this is our fourth house. So, you know, we moved up every, moved up every eight years and,

uh, we always get the 15 year fixed mortgage. We never stayed in anyone long enough to pay it off. That's my fault. That's her fault. Apparently every eight years she wants to move. Except this one. We're never moving again. I told him this is it. We're never moving again. We've been like in Tennessee. I promise Dave, never. Yeah, right. We've been like in Tennessee so much. Maybe we'll get a second house out here. Listen, you can do it now. Yeah. Wow. Exciting. Just to start small. a lot of people i think they they believe they have to have this huge house in this huge backyard and kind of keep up with the joneses and you just need to buy what you need and what you what you need and what you can afford that's

right yeah that's what you did here and you did something you could put in the you know put in the sites where we could do it in five years. Knock it out. Boom. Yes, sir. Because you rolled some equity into this, obviously. Yes. So good. Very good, you guys. Very good. Anything you can think of or you say, if someone asks me about this, I'm always going to tell them about getting out of debt, always do this.

Follow the baby steps. I mean, you've already paved the road. We just walked it. Like I said, we've been debt-free for years, but the mortgage was always, you know, step six. And we just focused on it, really. That was the only thing we hadn't done, and we wanted to do it while our kids still live at home or in school. And we wanted to show them it's possible. You did.

Way to go, you guys. Hey, we've got the Live and Give box for you. It's got the Baby Steps Millionaires book in it, because you are one. Total Money Makeover book, because you are one. Financial Peace University, because you are one. And so I guess you'll be giving all that away. Or maybe you can keep the one I signed in a few minutes and give another one away. I don't care. Whatever you want.

But way to go, you guys. You're perfect. You're amazing. Thank you. So, so proud of you. You're absolute heroes taking control of your lives. Michael and Jill, Phoenix, Arizona. $1.8 million net worth living in an $800,000 house. They paid off $570,000 house and everything. Making $170,000 to $200,000.

They did it in 45 months. Count it down. Let's hear a debt-free scream. to $200,000. They did it in 45 months. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Yeah! Woo-hoo-hoo! Wow.

You've got to love it. You've got to love it. That's amazing. Incredible. And, you know, we've heard these stories for decades around here and so it makes us know way deep down in our bones because we've just witnessed it that it can be done yeah and so we just want to make sure all of you know it can be done and that's one of the reasons we continue to do debt-free screams and um because each one of these stories has something special about it yeah

deep sacrifice i love it listen you don't have to sacrifice that deeply to pay off a home but the fact that they chose to do that is really really cool to me look at where it puts them net worth wise and cash flow wise yeah i mean they're making a couple hundred not a payment in the world oh man you got some money you stack some cash now, man. All right. You got choices. And we got an 18- and 20-year-old well on their way to being millionaires. I mean, that's talking about mathematically, but also spiritually and from a behavior standpoint, changing your family tree, because those two youngsters witnessed their parents doing hard things. Yeah. It's a big deal.

It's a really big deal. This is The Ramsey Show. Jade Warshaw, Ramsey personality, is my co-host today. Our question of the day is brought to you by Neighborly, your hub for home services. Whether your holiday guests left your home in a shambles or you just need some help getting caught up, a locally owned Molly Maid can help start the new year off right with professional, trustworthy maid services that deliver a worry-free experience. Go to neighborly.com slash Ramsey today. All right.

Today's question comes from Terry in North Carolina. My wife and I have worked hard. We paid off our debt and have a net worth of $8 million. We still watch every dollar and save and invest as much as possible. My brother and his wife do not follow the same strategy. Recently, my brother approached me for some money because he has failed to pay taxes for years. And the IRS is threatening to put a lien on his house. He now owes over $100,000 that I know about. I believe

in helping families, so I have given him over $23,000 and I plan to give him another $8,000 soon. I created a budget for him, set up separate accounts to help avoid reflex spending, and even recommended he listen to your podcast. Things went well for a month, but I found out he and his wife majorly overspent on gifts during the holidays. My worry is that my help has been a waste. He doesn't seem to recognize the damage that he is doing to our relationship by essentially spending my money on frivolous items while I keep the IRS office back. He also doesn't seem to understand that every dollar I give him is one I can't invest myself. Should I just walk away at this point?

I'm going to say yes. Let me back up my position on this, Dave. I'm looking at some of the language that you're using. And what I see here is resentment building. Because clearly you don't like the way he's living his life. I like that you're giving him the way he's living his life. I like that you're giving him the money and not loaning it to him. But because in your mind, there's these strings attached that he's not following. I feel like it's causing unrest in you and in your spirit.

I'm like, listen, you got to guard your heart a little bit because if you keep giving him money and he continues to not do what you think he should do, it's just going to build up your anger towards him, your resentment towards him. I mean, you said it right here. You said, let's see, he keeps spending my money while I'm keeping the IRS's office back. It's like you're, does that, do you hear that Dave? Where he's getting angry. And I also, what I also see here is you're trying to do everything for him. And as long as you do things for him, he has to do nothing for himself. Listen, he got to have a great Christmas because you gave him the money. And, you know, it doesn't say this written here, but if you're just handing him checks

for money, that, yeah, that's not going to work. Maybe you reach in and pay something off for him, but just, just giving him 23,000 and 8,000, you don't know what he's spending that on. If this was my brother, I would say I love you, and I'm cheering for you, and I will give you encouragement and advice, but no more money. No more.

I'm done. Because the money that I've given you has not helped you. You've not made any adjustments. What you did at Christmas was frankly ridiculous and insulting. After I tried to help you and gave you money, you went out and acted like a four-year-old. And so I love you. I'm going to cheer you on to the extent you want my help. I'm here to help you. But it won't be with any more checks.

It has nothing to do with my net worth or my level of generosity. And by the way, there is zero moral or ethical obligation to give someone money just because they're in your family. Zero. None. None. We all like to help people we love, whether they're in our family or not. But are we really helping someone when we're giving a drunk a drink? No.

And all you did was give him a big old bottle of Jack Daniels and he went and got trashed. He got trashed. But I feel like the brother who's trying to give the money, he's trashing himself too because he, it's. Well, he's the only grown up in the equation. Yeah. I mean, little brother or whatever he is, is acting like he's the only grown-up in the equation yeah i mean little brother or whatever he is is acting like he's four freaking years old i mean who responds to a gift by going out in a meet

you know helping with money by and after you know the given giver of the gift yeah says okay here's a podcast here's a budget here's separate accounts right and accounts, and here's some money, and we're going to stand you up, and we're going to put you on roller skates and push you down the road, and here we go. And what do you do? You take the skates off and throw them back at him. I mean, come on. That's why I say if you can't walk away and just kind of shake your hands and walk away,

don't do it. I wouldn't stop speaking to him. I would tell him you love him, and I'd be there for him and help him but that you are not required to give someone who is misbehaving money and you shouldn't because you're financing the misbehavior it's called enabling nathan's with us in austin texas hi nathan how are you i'm doing well how are you? Better than I deserve. What's up? Yes, so I've been listening for a couple of weeks now. My wife and I built up a little bit of debt over the years, mainly in credit cards, and we are committed to creating that debt snowball and paying it all off, but at the same time, we need to get her a vehicle we have one vehicle right now

that i use for work and we need to get her one by august because my daughter starts preschool where was have you always been a one car family um just for the last year or so. What happened to her car? She no longer needed it. She works from home and watches our daughter. So we had a car payment we were paying on. So you sold it to get rid of the car payment? Sold it, got rid of the car payment, and they actually paid us a little bit on it. What are you driving? I'm driving a paid-off vehicle.

What is it? It's a Chevy Equinox. What's your commute? So it depends. I'm in sales, so I drive as far as an hour to an hour and a half away, or sometimes I'm just... And her thing is she's got to take a kid to school. Right.

Okay. What do you make? What's your household income? So last year we made $105,000 together. All right. Gross. So if you saved up $3,000 and didn't put that on debt and went and bought a little car, would that be okay? I think that would be okay.

And I've been looking for vehicles in the area. Things I'm finding are more in the $5,000 range. That's because you weren't looking for a $3,000. There's lots of $3,000s. Okay, okay. It doesn't need to be anything fancy. How much debt have you all got left? So we have about $20,000 of debt.

We have $6,000 in student loans, and the rest is in credit cards. Okay. So if you're going to lean in and get this paid off really fast, then you can move up in car after you get your emergency fund in place, and this is a temporary solution. I'm not suggesting you ask your wife to drive a $3,000 car for the rest of her life. But for the next 18 months, yeah. Listen, if all she's doing is picking up the kids and going to the grocery store, that'll get it done.

All it's got to do is run, not leak. Right. Yeah. And there's plenty of $3,000 cars out there. I mean, an old Camry that's in good shape, even if it it's 150,000 miles or whatever maybe it's got a ding in it who cares and you know that's okay again this is an 18 month car it's not a lifetime car okay so should we not should we just pause the debt snowball and you have three thousand dollars yeah so i have three thousand dollars okay yeah a couple thousand bucks three thousand bucks

max and then go get you a little something that's kind of ugly but reliable. Mm-hmm. And it's the kind of car you give it a name. It's called a Hooptie, right? It has special features. It has special features. This is old blue.

Yeah. When I was growing up, we had old blue. My mama had a Chevy II. It was called. It was a Chevy II Nova, 1963. And it had air conditioning it was 240 air conditioning we rolled down two windows and went 40 miles an hour so there you go you know what they say about novas it it's nova means no go oh like that's the worst no way the worst car name ever oh wow i didn't know that okay now this car

is a it was a good little car as a matter of fact the brand the uh rebuilt ones that are very cool they're little hot rods now antiques rebuilt i saw one the other day that i almost bought but yeah they're they're pretty stinking cool but yeah yeah you just get an old car that needs a name uh we've had we had old blue at one time and um we had the bondo buggy once you gotta have something you gotta have something's got a name. And it's just for 18 months. It's kind of a part of the adventure of sacrificing to get out of debt. And then you go get a better car, and you pay cash, and you move up in car,

and you pay cash, and you move up in car, and you pay cash. And you pay cash. And you avoid debt. And you get out of debt. And you pay cash. And then you're a millionaire! Just like that. That's how that works. This you get out of debt. And you pay cash. And then you're a millionaire! Just like that. That's how that works.

This is The Ramsey Show. I'll see you next time.