The Ramsey Show - App - You Can Control Your Reactions During a Crisis (Hour 2)

Episode Date: March 31, 2020

Chris Hogan, Debt, Insurance, Retirement Tools to get you started:  Debt Calculator: http://bit.ly/2QIoSPV Insurance Coverage Checkup: http://bit.ly/2BrqEuo Complete Guide to Budgeting: http://bit.ly/2QEyonc Interview Guide: http://bit.ly/2BuGnZE Check out other podcasts in the Ramsey Network: http://bit.ly/2JgzaQR 

Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host, Chris Hogan, number one best-selling author, joins me this hour. Ramsey personality, and Chris will be doing our continuing our message, our message of hope series tonight. Rachel Cruz was on last night. Rachel Cruz, Ken Coleman, and I did the kickoff message last Thursday night that you can still view on our youtube channel millions of you have viewed it um it's a a series we're talking about hope and it's not a uh

chris we're not dealing with hope in the sense of some vague positive thinking concept hope that is uh based on a whim is not real hope hope that's based on a whim is not real hope. Hope that's based on fairy tales is not real hope. Hope that's based on facts, faith, this is real hope. It really is, Dave. And as I got a chance to watch you all on Thursday, it was just one of those, I find myself knowing this information, I was feeling uplifted. Because when it's rooted rooted in facts and you also, you gave a glance back through history and you start to see things a little bit different. You start to see it with clear eyes as I was telling people and really understanding that I am in control. I get a chance to choose how I'm feeling. I get to choose how I'm responding.

But more important, I get to choose my actions. And so I thought you guys did a phenomenal job. And Rachel did a great job. And I'm looking forward to my message getting out tonight. I can be afraid, but you can't make me be afraid. I can be angry, but you can't make me angry. I choose to do that. And so it's a chosen response to a situation.

Now, I have the ability to be angry. I have the ability to be afraid like anybody else. But when I function in either one of those two, I don't make good decisions. My decision-making paradigm, my critical thinking skills just melt away with the increase of my emotion. Right. And I have a tendency, like anybody else, to be unkind to people then, whether I'm angry or afraid. Or the worst kind is angry when you're afraid because you're afraid. Those are the meanest people on the planet.

Yes, it is. And they're out there shaming everyone, and they're in Facebook groups ripping everybody in their neighborhood for walking their dog and all kinds of just stupid behavior right now. Childish behavior. It's all based in just emotion that's out of control. You're right. And, you know, what's sad is, is that they don't see it. But they will try to shame you because you don't.

And you know what? I'm okay with letting people be crazy. I've decided. I've lost that muscle where I'm going to worry about they're crazy. I'm so focused on my progress and trying to help other people make progress that some things you just have to ignore. Yeah. Well, my grandmother used to say those convinced against their will are in the same opinion. Still, I can't.

All I can do is put the water there. I can't make the horse drink. That's right. And I'm not going to spend a lot of my personal energy trying to convince you when you're already convinced. That's right. Or you're crazy or both. Or you're mean or you're mad or whatever. On Twitter, it's real simple.

There's a little button, block. And like 10, 15,000 people, they tell me I have blocked now. Our social media team says I have set a record. Because if you wouldn't talk to me to my face. They would never. That way, then I'm not going to allow you to talk to me on social media that way. That's right. I don't allow people to use those words.

Yeah. You know, you effing this or what. I'm not. You're not going to do that yeah i wouldn't talk i've got better boundaries than that that's right and you know the same thing's true the crazy woman in the neighborhood next door facebook group ripping everybody shreds i mean you know somebody be an administrator in the facebook group and set the woman on the sidelines that's right or the man or whoever it is that's right just because i'm not

gonna manage your crazy for you. That's a good line, Chris. Yeah, I'm just not. And guess what? We get to decide, Dave. We live in the greatest country on the planet. And right now our routine has been knocked off. And yeah, we're having to make some adjustments.

But I still get to choose. I get to choose what's going into my head and my heart. I get to choose my actions and my steps. And I have to remind myself of that. I really do. And I'm reminding the people listening to my show that we, no, no, we get to choose and we have to, we have to be willing to choose as well. Yeah. We didn't allow the Ramsey kids when they were growing up to say, he made me mad. He make you anything. He may have been a little twerp. There may be injustice in the land that needs to be dealt with

but you chose your reaction no one makes you so you were making them own it early day one because i'm not gonna i mean because otherwise you're what i'm what i'm doing is i'm facilitating a whole house full of victims yes and they end up living in your basement until they're 30 so i wanted them to leave i had a plan and it worked they're out of the house they came back last night brought the grandbabies though that's good all right michelle is with us in new york hey michelle welcome to the dave ramsey show thank you so much for taking me a call, guys. How are you? Better than we deserve. How can we help you today? Well, I'm hoping for some guidance here. I am going to be receiving an inheritance probably in the next week or so for about $18,650. I have a total debt of about $15,200.

I am currently self-employed but unemployed and waiting for my unemployment to kick in. It's pending right now. So my husband is currently working, but I'm just wondering, should I use that money to pay off all of those debts or hold onto it considering what's going on now with the virus? What does he make? My husband, about $55,000. Okay. And what were you making at your self-employed income? $40,000. Okay. So your household income has dropped almost in half right now. Yes. And it's very scary. Yeah. That's pretty substantial. And yeah. Okay. All right. And yeah, you stop all your baby steps right now. Okay. And you just pile up cash. So this inheritance would be included in that discussion.

I don't want you to use it, though. I just want it laying there. I don't either. It's an umbrella leaning in the corner in case the rain continues to come. So now what kind of a business did you have, and what are you going to do to replace your income tomorrow? I have a cleaning business, and it's just myself. It's a solo cleaning business, so thankfully I don't have to worry about employees or anything,

and it's just postponed until this all ends. What are you cleaning, offices or homes? Homes. I have one commercial dance studio, but otherwise it's homes. And the homes have discontinued using you? Yes. I have some elderly unfortunately they don't want any other people in their home and then some have a lot of children so they're all home they have a hard time leaving for me to come in okay that makes sense unfortunately so let's say you you make forty thousand000 a year doing that, and so that's $3,700 a month.

If you go one month without income and you use $3,700 out of this $18,000 to survive, you'll still have enough to be debt-free when your income kicks back in next month. Okay. That make sense? So right now we're going to push pause on everything, pile up cash, do anything you can to get income coming in, and live on a really tight budget so that you don't have to touch this money. But if you touch it just a little bit, you're not going to touch it much.

It's not an excuse to spend $18,000. It's an excuse to spend $3,000. This is the Dave Ramsey Show. I get asked all the time about what people need to do to improve their family's money situation. Two of the most overlooked things are term life insurance and disability insurance. Both plans make sure that you have income to pay bills and take care of yourself and your family if something were to happen. For term life, you need to carry 10 to 12 times your income, and I recommend 15 or 20-year plans for most families. Stay away from cash value or return of premium plans. They're just a

rip-off. Disability insurance is just as critical. How are you going to pay your bills if you're unable to work? Disability is the leading cause of bankruptcies and foreclosures, and that's why I send you to Zander Insurance. They've been helping my listeners find the right plans at the lowest cost for almost 20 years. Call 800-356-1780 or visit zander.com and compare online. That's 800-356-1780 or zander.com. Dan is with us in Florida. Dan, welcome to the Dave Ramsey Show. Chris Hogan and I are here to help. What's up? Hey, honored to talk to both of you.

I'll get right to it. I've got a 21-year-old and a 23-year-old driver in the family, four of us with my wife and myself. And I've been trying to figure out how to calculate how much an umbrella policy should be. Usually a million dollars is around $250 a year, even with teenage drivers, because the umbrella policy is usually not impacted by that. It picks up from the top of your liability on your car insurance and adds to it. And so if you've got $500,000, which would be typical on a decent car insurance policy,

you add a million on top of it as a liability. It adds also to the top of the liability on your homeowners' umbrella over everything. Most states are around $250. Did you get a quote? I do, and I guess what I'm asking is how do you scale that up? Do you scale it to your net worth? You can go more i carry 10 million um but uh but what is your net worth well it's different than it was 14 days ago but

let's just go with where things were before the the market dropped but it's just just right around three million okay um what i would do is I wouldn't title the cars in your name. I'd title them in the boys' names or the kids' names. Your car insurance is going to go up, but they're not minors. They're over 18, and so the liability goes completely off of you then. Even if you pay part of their car insurance, as soon as my kids turned 18, the cars were out of their names. I did not want the liability on my

name because they're worth financially nothing and i'm and i'm a target and so i i wanted to limit my risk that way uh and in your case i think a one million dollar policy umbrella policy be fine if you wanted to look at a five you can look at it. It's, if I remember, it's probably about $600 a year, $700, something like that, instead of $250. But a million is probably there. But from a risk management perspective, you're going to pay more car insurance by moving the cars out of your name, but you've gotten rid of the risk. Well, I got a quote. It was very reasonable.

I got a quote through one of your ELPs. It was about $800 for $3 million. Yeah, okay. I thought that was a pretty good place to go. It's okay, but I honestly, even with that, I'm scared of the cars in their name. Yeah, no, this is why now I'm glad I called because I had no idea that was a best practice. Well, people disagree, but it depends on your net worth, see. I mean, if you've got a $400,000 net worth

and the increase in car insurance is a huge deal to you then financially, but it's not to you. You've got a great income or you wouldn't be sitting where you're sitting. And the risk means more to you than a little. I mean, you pay another $1,000 a year even in car insurance. Whoop-de-doop-dee. You've got these little lawsuit magnets off your butt yeah yeah dan is your house paid off oh yes okay yeah and have you guys have you done an estate plan at all

thanks to you guys i have uh i have a trust okay good You guys changed my life. I didn't. You did it. You did it, buddy. We gave you some info. Dave, in front of 8 million people about four years ago, told me I was spending money like Congress. And I hated him for a while. Yes. I came back.

I used your real estate ELP to sell a money pit condo I had, and your insurance ELP saved me $7,000 a year when my kids were just starting to drive. Wow. Yeah. I went from $12,000 to under $7,000. I'm sorry, under $6,000. So people out there, listen to what these guys say, because I was doing Dave-ish, and then it all turned around for me.

So thank you very much. Well, hey, we're honored, man. I have the gift of pissing people off for their own good, for their own good. That is a spiritual gift, Dave. You are blessed in that way my friend you know I think I get away with it because folks know I really love you I want you to win well and I you know they don't they I'm not just being mean to be mean I'm just but I will pop I mean it's like a good coach you know some coaches are deranged and you don't want to play

for them they're toxic that's right but other ones they can get crawl all up in you and you're fine with it because you know they love you that's exactly right and you will follow them and do anything that's exactly right because they care um and uh someone asked me i said they asked me they said what is what's it like working with dave i said well he's he's a loose cannon he's uh he's going to tell you what he feels but i I said the reality is that it comes from his heart. And I said I've sat with this man as he's talked to people, and I've seen him go back and revisit his bankruptcy and revisit that moment and the never-again look in your eyes. And that motivation is to help other people that are out there.

Yeah, it's what we all do. And the thing is, I grew up in the South, and you did too, and we are dangerously passive-aggressive. Yes. In the name of being nice, we will just lie to you. And there's only one time that that's okay, and that's if your wife says, do these jeans make me look fat? And in that case, you're supposed to lie. But other than that, you need to be kind and tell the truth yeah because no one gets better unless you're telling them the truth

to be unclear is to be unkind and forever in my little southern sweet tea way i was trying to be nice and what i was doing is i wasn't helping anybody because i wasn't i was you know the best thing i did for him is i made him mad he didn didn't like me for a little while. That's what he said. I like that. I mean, that's a compliment. He loves you now, though. I did my job. I did my job.

I love it. I love him. He did a great job. Well done, sir. Spencer is in Colorado. Spencer, welcome to the Dave Ramsey Show. How can we help? Hey, thanks, Dave.

Hi, Chris. How are you guys doing? Great, man. What's up? Hey, I've got a question about my wife's pension. Before we moved to Colorado, we lived in Florida. She had enough years in Florida as a teacher to qualify for a pension. We are not able to take a lump sum payment because I guess when we moved,

if we didn't notify them within a certain amount of time, we only have the option to do like a monthly payment. She's not retirement age. She's 53, but she can take early payments at a reduced amount. It's like 5% every year that you take it before you're 62. And then it comes back up. Or is it reduced for the entire life it's reduced for the entire life so my my question is should we take it now and start investing it um at a

reduced amount or should we wait until she's closer to 62 okay so she's 50 she's 53 53 yeah okay so you say nine years of those reduced payments in a lump sum at 10 i'll just make up a number right would that replace the income reduction from 63 on you see what i did so do you know what the payments are yeah so if we take it right now it'd be um it'd be 4 000 a year if we waited till she was 62 it'd be 7200 a year okay so nine times 4 000 is 36 000 10 of that's 3 600 a year added,000, and you said she would make what if you wait until 63? She waits until 62 would be $7,200. Okay. So, again, if you put the whole $4,000 into an account for nine years,

and it doesn't earn any interest at all during that nine years, which is an absurd assumption. You put it in mutual funds. But if it only broke even and it was $36,000, if it earned 10%, that would be $3,600 added to $4,000 is $7,600, which beats $7,200. Plus, you have $40,000 in your pocket that you own. So, you see what I did? Yeah, because if we... Take the $4,000 and put it in mutual funds.

And don't touch it. And let it grow. And that lump sum will more than replace the loss or the reduced payment from then on. That's your math formula. That's good. It's like a sixth grade math formula. No, it's a little bit further than that, but you did it fast. This is the Dave Ramsey Show. I love talking about companies that know how to do business right.

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Thanks, Dave. How much have you paid off? I paid off $75,000 in about 36 months. Good for you. And your range of income during that time? Was $42,000 and then went to $65,000. Cool. What do you all do for a living?

I work in customer service for a living? I am a I work in customer service for a dental insurance company. And I'm in the golf manufacturing business. Okay, cool. Very cool. So 36 months ago you start this whole journey

to get out of debt. What kind of debt was the $75,000? We had the majority, so 57 000 was in student loans and then uh the remainder was split between credit cards and our wedding um all things associated with it so i'm guessing you've been married 36 months got married came home from the honeymoon went game on game on. Man, you're good. But when you started that three years ago, obviously you had no idea. How weird is it that you started that three years ago, and in the middle of this craziness, you're celebrating not having a dime in payments. That's surreal, isn't it?

It really is. We've reflected on that a lot lately, how awesome it is that we were able to get it done and, you know, not be panicking right now or anything like that. Yeah, you've got a whole different feeling in your stomach than other people have. For sure. Yeah, it's very, very, it's like, wow, I feel like I just dodged a bullet. It's a huge mess, a missile, really. Yeah, it's very, very, it's like, wow, I feel like I just dodged a bullet. It's huge, massive, like a missile, really. Yeah, absolutely amazing.

So what inspired you all to do this? Well, we, like we said, we got married. Right after we got married, we actually found out we were pregnant with our first daughter. Awesome. And we decided to move back home to Scott's hometown to be closer to family. And right before the move, the job he had lined up fell through. So we were in a new place and jobless. And we quickly realized we were running out of money and, you know, pregnant, about to have our first child. So we knew something had to change, and that's when we signed up for FPU,

you know, to get on the same page with each other. Was it just being held at your church, or how did you hear about it? Yeah, it was at our church. And I had actually, you know, been doing, you know, the Davis thing for a little while, but we knew the church up here that we were going to was having it so we decided to just go through them um to complete it very cool that's fantastic chelsea as you look back on this journey of 36 months what was the biggest sacrifice you made the biggest sacrifice um actually right after I had my daughter, I had the opportunity to work second shift at my job.

So we made the decision for me to do that. So we didn't have to have any daycare costs. And so I've sacrificed a lot of sleep over the last couple of years. Yes, you did. But it was totally worth it, not only to spend time with my kids, but, you know, so that we could get this done a lot faster. Yeah. Scott, what did you find out throughout this process about your wife? She's a superhero.

She's an absolute monster, a beast, and a partner that you can't describe with words. You know, we'll say that sometimes, and I'll look in her eyes and just tell her if she realizes how unbelievable she is, because she is. That's fantastic, man. I'm proud of you all. He just called his wife a monster and a beast, though. Yeah. It was after superhero, though. And made her like it.

That's what was interesting. That's right. That's so cool, you all. Proud of you. Yeah. Who were your biggest cheerleaders outside the two of you? Man, I would say really, really your team podcast and series of informational streams.

Honestly, I listen to you every day, three hours a day as I'm going to and from golf events. So, um, and you're inspiring, uh, clips. And yeah,

that really, that, you know, just when we felt like we don't want to do it anymore, just, you know, checking in with your shows and stuff and saying, you know,

we're going to get this done. We're going to finish what we started. Because, you know, our families don't really, they just don't really understand, which was fine. But, you know, to have relatability and be able to check in with your shows and be like, you know, we can get this done really helped. Yeah. So what kind of golf do you do?

What's your deal? So I'm in the golf manufacturing. I do events for Cleveland Trickstons Exios, any demo day or fitting, all the events you'd find at your Greengrass or off-course locations. I do all the events and sales. I do all the events and part of the sales for them. Cool. Good for you.

That's a fun job. Cool. Well, fun, man. Good for you guys. We're very proud of you. We've got a copy of Chris's book, Everyday Millionaires, because we are sure that is the next chapter in your story. And we want to hear back from you soon on a millionaire theme hour,

because you're going to be there in 20 minutes the way you two are going. We're very proud of you. All right, Scott and Chelsea, 75,000 paid off in 36 months, making $42,000 to $65,000. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Yeah!

Yeah! Wow. Oh, that's fun. That is fun. So very cool. So very cool. Good stuff. Open phones at 888-825-5225.

March has, you know, typically we have a debt-free scream every hour. But because we had to shut the building down and we're working from home, at least the vast majority of our team is working from home. Chris and I are certainly here in the team putting this show on, but that's 20 people out of 1,000 are here, and we shut the building down to the public. So that's kind of confused or shortened our debt-free screams, but we still had just under $3 million in debt-free screams in the month of March. Oh, wow.

Month of March. So that's pretty cool. That is fantastic. Good stuff. Kyle's with us in Mississippi. Hey, Kyle, welcome to the Dave Ramsey Show. How can Chris and I help? Hey, Dave, what's going on?

Better than I deserve. What's up? I called you guys at 5 and 8 now, and I finally got through. It's awesome. So I had a quick question. I just wanted to pick your brain. This is really just some personal advice, I guess, a little bit financial. I've got a job opportunity, but the job opportunity is going to require my wife and I to move across the country.

I'm out of state. Your phone sounds muffled. Can you speak directly into it, please? Yes, sir. Can you hear me now? A little better. Okay, go ahead. So you have the opportunity to move to California with a job opportunity. Go ahead.

Yes, sir. Yes, sir. I got the job offering writing, and it's actually going to be a little bit more money for us, but I just wanted to, I guess, ask you if the move actually would make sense or not for us at this time. Kind of give you a little bit of backstory. So we've got about, right now, about $53,000 in student loans.

What do you make now? I make, my base salary is $59,000. What do you make now is $59,000. What do you make now? $59,000 or do you get a bonus too? It's an annualized bonus, but I'm with the Greenfield Plant. So production is like kind of, it's a big factor in that. So what do you think you'll make this year? This year I'm going to pull in $61,000.

Okay, so $61,000. And what will you be paid in California? Total compensation is going to be a base pay of $81,000, but the first two years I've actually secured a sign-on bonus of $11,000 the first year, $9,000 the first year, $9,000 the second year, and I get some what you would call restricted stocks. Will you be doing the same thing you're doing now? Along the same lines.

Do you want to live in California? We have family there. Okay. Well, you're making more money. You got family there. Is there Well, you're making more money. You got family there. Is there a reason to not do this? I just know the cost of living is higher. It's not 25% higher than your income is.

Okay. Pack your bags, my friend. Yeah. You're going to be in California for a while. You're going to be near family. You have a higher cost of living, much higher real estate cost. Sign-on bonuses. But with all this money, you're making 30%, 40% more income.

Pack it up, kid. Elizabeth is with us this hour in Texas. Elizabeth, welcome to The Dave Ramsey Show. How can Chris Hogan and I help you? Hey, Dave. Hey, Chris. So at the end of this week, I'm going to be transitioning from working in the corporate world full-time to being a full-time stay-at-home mom. Cool. And thanks.

So I'm wondering, based on the way that the market is right now, is it wise for me to roll over my 401K and my lump sum pension into personal IRAs, or should I wait until the market comes back up? I would go ahead and do it. Number one, the pension money will be invested while the market's low, so that's excellent. The shares that you sell from your 401K, assume they're in mutual funds yes and then when you roll them into other mutual funds you will be selling at this low price and you will be buying at this low price okay so that part's a wash

yeah it's just like i i felt like i knew exactly what i needed to do and then everything yeah oh it's good it's a great question. But here's the thing. If you did a direct transfer rollover and you kept it out of the market, like you sold it right now low, and a month from now it rebounds and you wait to put it in a month, then you've sold low and you're going to buy high. We don't want to do that. But most of these transactions will occur within a few days of each other and it's not going to be a substantial shift in the market one way or the other when you're doing a direct transfer rollover sometimes they can even

be done within a 24-hour period and so just check with your smart investor pro on that but the good news is the pension lump sum will be invested while the market's down here you're catching it right yes and thankfully that was so outside of this the market that it hasn't changed like my 401k right right it was under the reason you take it is it sucks and it has always sucked and it will continue to suck if you leave it there so you take it out and you're moving it from that into a market that currently sucks but we'll get better good but that's exactly right yeah exactly yeah cool so look at you coming home how many babies you got i know we've got two a three-year-old and a one-year-old oh okay very cool so this was a goal you've been working towards yes so we decided about a year ago when our daughter was born that this is what we wanted to do.

So we started trying to research, you know, what should we do? How should we make sure that this is financially the right decision for our family? And we discovered you guys about last summer. Thankfully, we've always been really wise with our money. So we were basically already in baby steps four, five, and six when we found you, which was encouraging. So we really just practiced. I mean, we basically had all of my income go into savings and we deducted our daycare expenses out of that and lived off of my husband's income using the direction from the EveryDollar app, which we'd never done a budget before.

We just were really blessed and we've both had really good careers. So we've always, in the past, had just kind of, we knew we were spending less than we were making, but we weren't really being wise and strategic. So now we're super wise and super strategic and cutting our income in half. Yeah, and what's weird is you probably didn't have to sacrifice. You just got more efficiency by having a clear direction and organization. Exactly right.

Yeah. Well, and it's amazing what happens to it, Elizabeth. When you have that common goal, you know, sacrifices aren't that bad. You know, it's just little small adjustments because it helps you get closer to it. Well, what I would do is get with a SmartVestor Pro. If you don't have one already, click at DaveRamsey.com, click SmartVestor. These guys don't work for us, but we recommend them for helping you with your investments the way we teach here. They've got the heart of a teacher, and they can do a direct transfer rollover on your 0401K

and do a rollover, also be a direct transfer on your pension you don't want those dollars to come into your name because there's a 20 required withholding you want it to go directly from your old place into your new iras with mutual funds you select always pick good mutual funds that have been around 10 years or longer and that have outperformed the S&P 500 because otherwise you would just pick an S&P index. But they're out there. That's how I do my personal investing, and I spread it across growth, growth in income, aggressive growth, and international. And now is a great time to buy and a horrible time to sell for those of you that are scared right now kevin is with us in mississippi hi kevin welcome to the dave ramsey show what's up

hi dave hi chris how you doing great how can we help well i was a fortunate one that actually paid my house off in february before all this madness hit. Wow. I'm self-employed. I have a construction company. It is an LLC. But I want to know what I should do to protect my largest asset, my house. I mean, never been sued, never been threatened to be sued, but just want to do the right things, you know, to protect that asset. The business is all transacted in the LLC, correct?

That is correct. Do you carry any debt there at all? No, I don't carry any debt in the business either. Okay. So the only thing you would be sued for would be someone hurt on the job or some kind of construction that wasn't done properly or accused of that or something like that, right? That's correct.

Yeah. Well, they would have to sue the LLC. Your home is not in the LLC's name. They could sue you personally and try to get to the home, but if you've conducted all your business and all the paperwork with them, the customer in the name of the LLC, you check with your attorney. But my understanding legally is that the only thing they can sue is that LLC because that's the only thing they've had a transaction with.

Now, they could take your dump truck or whatever home by the LLC if you lost, but they wouldn't get your personal residence. For an example, Kevin, I use LLCs on rental property. When I get to $5 million or more of rental property in one LLC, that's a big enough target, I form another LLC. So if someone that's in that particular LLC falls off the front porch or something and wants to sue us, which actually did happen one time, the insurance company handles it with the umbrella policy, which I carry. But in addition to that, if I did lose, the most they would take would be the assets of that particular LLC.

They wouldn't get to my personal stuff or the other LLCs because they haven't had a business transaction with them. Those are not liable for their front porch accident. Only the houses or the other properties or whatever it is that are contained in that one LLC. Consequently, as my assets have gotten bigger and bigger and bigger, Kevin, I now own nothing. There's not a single thing in my name. My cars are even in LLCs because I've got a target on my butt. I mean, if I bump into somebody, they're going to go, oh, I'm fine. Oh, wait a minute.

You're Dave Ramsey. I think I'm dying. You know, right? And so, you know, that's what's the litigious culture we live in, right? And so that's why you're asking this. But, yeah, I think you can check with your attorney to make sure you're doing a very good job of very carefully doing all your wording. Every document, every bill, every invoice is never in your name with the construction company.

It's all in the name of the LLC, all the contracts with the customers, all the contracts with the vendors. If you rent a backhoe for the week, everything. The checks are all signed in the LLC. All letters are signed to the LLC. Everything's conducted in that name, and that creates what we call a corporate veil. Yes, and that's going to have to require consistency, Dave. You can't slip up with that. Small business people are sloppy with it. That's why I'm being so dramatic about this is because if you say you have an LLC but you do everything in your name, then they're going to say, well, you don't really have one.

That's right. And you go, no, no, this is a completely separate entity over here. You have to be very diligent to keep that corporate veil intact. And, of course, keep the taxes filed, keep the filings done with the state to keep it active, all the different issues there. But where you can prove that the entity is a functioning standalone veil, and it does protect you then. Well, Kevin, I'm going to tell you this. I'm proud of you. Yeah. To have been focused, self-employed, in construction, and to have that mindset for you to pay off your home. And all his business.

All your business. No debt anywhere. Wow. That is absolutely the way you get it done. Congratulations, my friend. Man, what a great place to be sitting right now. That's right. You feel like the little pig that built the brick house.

That's right. Not the one in the straw house. Huff and puff. Man, here comes huff and puff. Puff the magic dragon is in the land, without a doubt. Chris Hogan with me this hour. James Childs is our producer. Zach Bennett filling in as our associate producer and phone screener.

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