The Ramsey Show - App - You Can Say YES to Adventures When You're Debt-Free (Hour 2)

Episode Date: June 24, 2019

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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 am Dave Ramsey, your host. This is your show because it's all about you, your life, your money, and it all shows up right here. Your dreams, your nightmares, they all shows up right here. Your dreams, your nightmares, they all show up right here. It's a free call, and some say the advice is worth exactly what you pay for it. The phone number is 888-825-5225.

That's 888-825-5225. Andrea starts off this hour in Alaska. Hi, Andrea. How are you? Hi, Mr. Ramsey. I'm well. How are you? Hi, Mr. Ramsey. I'm well. How are you? Better than I deserve. What's up? It's sort of a long story, but when I was 19, my father convinced me that the only way

to keep our farm afloat was to take out a $36,000 agriculture loan in my name. And it has been three years, and he has not made any payments and i'm sorry about a loss for what to do now and so the loan that was taken out in your name is it a lien on the farm um we put up collateral in the form of livestock that we were going to purchase with the money and i think a bit of equipment that we already owned. And what has happened to the livestock and the equipment? What was that? What has happened to the livestock and the equipment?

Has the bank picked it up since you haven't paid a payment in three years? No, they haven't taken any action against us. It was suggested that I take the loan and go into deferment. So they can take the bits of collateral back, but that would break up whatever semblance of a family relationship we have left. Okay. I'm sorry, so you're 22 years old? Yes, sir. Okay.

And your dad asked you when you were 18 to take out a loan, and he's not paid a single payment on it in three years. Yes. They've taken my tax returns the last two years, but that hasn't put much of a dent in anything. Yeah. What do you do for a living? I'm a receptionist. Okay.

Do you live with them still? I do, and I go to school full-time. Okay. And do you pay your own bills? I do, and I go to school full-time. Okay. And do you pay your own bills? I do, and I pay a portion of rent, I guess it would be. Oh, on the farm. Okay. Why have they not paid the payments that they agreed to pay?

It's hard to say. I've tried confronting him about it, and it doesn't end well. Usually I'm in a fight, and then things don't get solved. I'm so sorry. What a horrible position for a 22-year-old young lady to be put in by her. I hesitate to use the word father. What a creep. So are you involved in your church and your community? I'm not.

I think you need to seek some counsel from a family counselor and maybe a pastor and get some people in your corner because, truthfully, what's happening to you is called financial abuse. Your parents are abusing you, and they're using their position and their emotional stronghold over a young woman to take advantage of you and really setting you up for a problem that may take you a decade to recover from financially. And so here's what's going to happen. This is not going to end well, no matter what you do.

You need to come to that conclusion, okay? Your dad is not a good guy. He has not done a good thing. This is horrible, and it's not going to end well you cannot make your father be okay can you hear that loud and clear yeah i'm sorry darling i'm sorry you're facing this but you do not have the power to make your dad be okay he was not okay a long time before this conversation came up and so what you've got to do is just admit he's a mess. He's a hot mess.

And he's probably not going to be happy with anything that you do because eventually they're going to foreclose on and sue you, a 22-year-old receptionist who's in school. They're going to sue you. They're already taking your tax return. And school they're going to sue you they're already taking your tax return and eventually they're going to sue you okay and they're going to take the collateral because for some reason bozo thinks he doesn't have to pay payments i don't know why bozo thinks this but he's crazier than a bean apparently but i don't know who takes advantage of their 22-year-old kid anyway. So I can't grasp where this guy's coming from.

So he's going to be upset. He's going to be mad. And it's his fault. Can you hear that? Yes, sir. So you're going to have to just decide when that's going to be. And you probably need some good, strong, mentally healthy people in your corner walking with you to guide you and gently and kindly stand up for yourself

because you never have. You've been abused. Do you realize you've been emotionally taken advantage of? Not until you pointed it out. Okay. Do you think that's the truth yes sir yeah does it feel that way to you yeah i mean you got crapped on didn't you i mean really by your own dad i mean he has not

he's left his own kid vulnerable and and so what if he were if he were to grow suddenly manhood grow suddenly a backbone he'd start selling everything in sight in order to keep his own child from being harmed but this guy ain't gonna do that is he no not probably he's not he's not we know that by the fact that you're in this situation to start with. And so you're going to have to start taking some steps to protect Andrea, who is an abuse victim. And you're going to have to decide what those steps are going to be. And none of those steps are going to make him happy. I'm so sorry you're going through this.

Hang on the line. I'm going to have Kelly send you a book that I want you to get a highlighter out and post-it notes, and I want you to memorize the whole freaking book, but certainly entire paragraphs. It's called Boundaries by Dr. Henry Cloud. Because you have had someone walk over into your yard. No, they drove a bulldozer over into your yard and did donuts. Okay, they stepped all up into your stuff here. And it was your own dad, which just makes this heartbreaking, but also very, very difficult emotionally to process for anyone, but certainly for a 22 year old living

at home on the farm. I'm sorry, kiddo. Hold on. Kelly will pick up. There's no magic answer to this except him sell everything and pay the bill, and he's not going to do that. Kelly's going to pick up. We're going to send you a copy of that book.

Open phones at 888-825-5225. You jump in. We'll talk about your life and your money. Let me go ahead and help you because we have just finished some identity theft research. And would you believe that 14% of identity theft is by someone you know? And a disturbing amount is by parents who take out loans in their children's social security numbers. Or maybe borrow money on the farm and talk the 18-year-old into it. That's not identity theft, but it's so close that it really could be categorized in the same bucket of slime.

Scum. That's what's in those buckets. You parents who take advantage of your own kids? Slime. Scum. I got a call the other day, and I thought it was worth talking about again. It was from a wife looking for life insurance for her family. She asked why I only recommend term life insurance instead of cash value plans like whole life. I usually explain how you overpay for coverage, earn a horrible rate of interest, and don't get your cash value when you die. But this time, I just had her go

straight to Zander.com and get a rate. And then we compared that rate to the whole life plan, and she immediately saw the huge savings. She realized all the things she could do with that money like paying down debt, investing in a smarter way. That made it real for her. It makes no sense to buy or keep a cash value plan when there are smarter, less expensive ways to protect your family. That's why I suggest that everyone go to Zander.com or call them at 800-356-4282 and get a free quote. That's Zander.com or 800-356-4282. Trevor's with us in Portland, Oregon. Hi, Trevor. How are you? I'm doing pretty good, I suppose.

Good. How can I help? Well, currently, I've been saving money for a while because I'm pretty content right now. So there's nothing I really want to buy. So I've just been saving up all my money for a while because I'm pretty content right now. So there's nothing I really want to buy. So I've just been saving up all my money for a while. Now I've gotten to the point where I have about $500 kicking up in a cigar box my brother gave me to store money in. And I was just wondering if I should just shove it all in my bank account or do something like micro stocks. I don't know. I'm just curious.

And how old are you? I'm 13. Okay. Where'd you get the $500? Well, I don't know, just a combination of saving over the years. Okay. Are you working or are you earning money? Yeah, I'm working.

I don't know, just last week I just helped my, I went to my friend's house and I weeded with him and his dad, and I made some money there. Yeah, good. And I sometimes lawn mow, and I get, you know, paid by my dad, and, you know, that sort of thing. Good for you. Very good. When you turn 16, who's going to pay for your car?

Well, I'm guessing my parents, but I don't know. I might want to be a bit more financially independent, but I don't know. I might want to be a bit more financially independent, but I don't know. You might want to have a discussion with them and say, are you guys going to buy me a car, help me with a car, or do nothing towards my car? Because then that would give you something to start planning towards and saving towards, and then I would pull that money out of that cigar box and put it in a savings account and add to it towards buying your first car. That's probably a really good goal to have when you're 13.

And then you've got something systematically. When you earn money, there's three things you do with it, Trevor. You enjoy it, meaning you go out and spend it. You give it and help someone else. And you save and invest it towards your long-term goals, like in your case, a car. So when you're earning money, I'd try to do all three of those. But with this money, I would use that as the starting point

for your good savings account over at the bank. And let's start saving towards that car. That would be my game plan. Taylor is in Houston, Texas. Hi, Taylor. How are you? Hey, how's it going better than i deserve what's up all right so i just kind of got started with uh just bought your book maybe

a week ago and uh i feel like i've been doing a good job at saving and i'm i'm kind of torn on what to do so we make 200 000 combined me and my wife, and I've got $16,000 in the savings, and all we owe is $26,000 on her car. My truck's paid off. We owe $133,000 on the house, and I've got $529,000 for my son, which I contribute about $330 a month. How long have you been making how long have you been making 200 uh for about five years now where's it all gone yeah that's a good point okay i don't know all right well what we teach folks to do is um to work through a financial planning process we call the baby steps which is the shortest method that we know of,

and we've had about 10 million people do it now, the shortest method we know of towards becoming wealthy. You make really, really good money. You make too much money to be this broke. So baby step one is to save $1,000 and stop all investing, including 529, including 401K, until you get these baby steps done. Okay? So temporarily stop the 529.

Temporarily stop any investing you've got with 401Ks or anything else. And, you know, you have $1,000. Well, you've got that because you've got $16,000. Right? Right. And so I'm going to take everything above $1,000, which would be $15,000, and I'm going to throw it on that car. It means that we've got $11,000 left to pay that car off. And then that's baby step two is to become debt-free, everything except the house.

And so we're going to attack that car, and in just a matter of a couple of months, you ought to have that car paid off. Would you agree with that? Yeah. With the kind of income you've got. And then from there, baby step three is to have a fully funded emergency fund of three to six months of expenses. So in your house, that's $25,000 or $30,000 you need to set aside just for rainy days. Just for rainy days. Never touch it for anything.

Once you have that, then and only then would I start your 401K investing, 15% of your income going into retirement savings. That's what we call baby step four. Baby step five is start to save for kids' college, so I'd restart the 529. At the same time I did that, and then any money I can find in my budget, and you need to start doing a written budget every month so you know where this freaking money is going. And then once you get that then i'm gonna uh any other money i can find baby step six is thrown at the house and we'll get the house

paid off because you don't owe much on the house you'll probably pay off your house in two years maybe three years something like that if you start doing a written game plan and telling your money what to do instead of wondering where it went and you can do all that you're making really good money i don't want you to look up five years from now again and go, I made another million dollars and I don't know where it went. So that's the budget, having a written game plan to accomplish those steps. You do those things and then you continue to invest and give, you're going to see ridiculous levels of wealth coming your way

because you have a ridiculously wonderful income. And it's fabulous. I'm glad. I'm proud for you. Hold on, Taylor. I'm going to send you a copy of the book, The Total Money Makeover, which is going to show you how to do exactly what I just outlined.

It's those baby steps on steroids. That's what this book is. And that's why we've sold six and a half million of them. James is with us in Los Angeles. Hi, James. How are you? Hi, Dave. I'm good. How are you? Hi, Dave. I'm good.

How are you? Better than I deserve. What's up? Hi, Phil. I'm calling because I'm $107,000 in debt, and I want to be an actor. I went to a very expensive school here in Los Angeles, and, you know, I went. I took a path that I didn't want to take in the first place because, oh, I want to take the stable job and everything. And yet here I find myself more unstable than ever, you know? Um, um, you know, I know that the,

that the debt is nothing more than a symptom, um, to everything that is going on. And hopefully, and I'm right now currently, you know, getting help in therapy and all these other things. But I don't know, you know, I read your book, The Total Money Makeover, and I started, you know, hitting early debts, you know, really, really strong about a year ago. And then I just kind of lost track of it and fell off the wagon. Thankfully, I haven't really gotten into more debt. I caught the cards and all that stuff, but I don't know where to go. I don't know if I need to find a group. I don't know what I need to keep myself moving

in the needle, so I'm calling for your help. Okay. How old are you? I am 26, about to be 27 next month. Good for you. What do you earn? What's your income? Well, actually, I'm unemployed right now. I lost my job about three months ago, and I haven't been able yet to find something. How are you eating? I am receiving some unemployment right now from the job that I was, and that's kind of what's kind of helping me build, you know, continue on close.

That's going to run out. What are you going to do? I currently don't know. You know, my first thought was just to do the most basic thing, you know, something like Uber or Lyft, anything, just to kind of keep myself going until I found myself, you know, back in a career but hopefully not in a career that i that i hate at least in the at least in my way to uh you know while i pay off this debt because i mean like i told you you know what were you doing before

i was uh working as a um distributor as a publicist that's kind of the career that I took on college, and I was doing that fine, and, you know, I was enjoying it more or less, but it isn't really my passion. So why did you lose the job? I just was not getting along with the people that I was working with, and it was a very detrimental kind of situation, so I, you know I just departed away. I see. Okay. All right. Well, I mean, the biggest crisis you have on the horizon right now is not a debt crisis. It's an income crisis, and so a career crisis. And so we've got to get you working again, dude,

so that you can earn your way through this $107,000 worth of debt. That's the trick here. And then if you don't have that monkey right earn your way through this $107,000 worth of debt. That's the trick here. And then if you don't have that monkey right on your back, you've got more choices. You've got a lot of options, things you can do at that point. So, you know, it's all about income in this case. It's all about you finding something that you can tolerate or do to, first and foremost, survive, and then secondly, to be able to clear this debt. So let's work on the career side of the equation. This is the Dave Ramsey Show. Thank you. Patrick and Callie are with us.

And if I'm reading my screen right, it says you're calling from Kenya? Yes, sir. How are you, dude? Great. Thanks, Callie. Wow. So what are you doing in Kenya? Yeah, we both work for a company that works with smallholder farmers.

That works for what? You work for a company that does what? That works with smallholder farmers. I still didn't understand you. That's okay. So you want to do your debt-free scream. How much have you guys paid off? Yeah, we've paid off around $77,000 in three years.

Good for you. Way to go. Cool. And what was your range of income during that three years? We started around $34,000, and we're now currently making around $96,000. Wow. Cool. Okay.

Good. Good. What kind of debt was the $77,000. Wow, cool. Okay, good, good. What kind of debt was the $77,000? All student loans. Wow. How long have you guys been married? Around eight years now. Okay, cool. So where did you grow up? We grew up in Broken Arrow, Oklahoma. We've been together since we were 15 and then went to college together and now in Kenya. Wow, and now you're on this adventure. Well, very cool.

Very cool. So what made you decide to get out of debt three years ago and get your hair on fire? Because you guys have gotten with it. This is impressive numbers. Yeah. I think we just took a look and realized that normal wasn't working, and we wanted to be very intentional, and we also knew we had some big changes, like moving abroad and taking on kind of a unique job and lifestyle. So I think we just took that time to get really serious.

Wow. So how long will you be in Kenyon, do you think? We don't really have an exit strategy. I think we're here for the long term until something like this somewhere else for right now, but we're pretty happy where we're at. Cool. How long have you been there? We've been in East Africa off and on for the past four, almost five years, but in Kenya for two years.

We're about to celebrate our two-year anniversary here. Very fun. Good for you guys. Congratulations. $77,000 in student loans paid off in three years. What do you tell people the secret to getting out of debt is? Yeah. I think we have three things that we did that worked for us.

The first one is the budget and the envelopes. I have to admit, I took throw pillows back to the store after I realized we didn't have any room in the envelopes for them. So I bought them, and the next day they went back to the store. And then the other one is saying no. We are living in a venture, but with that comes a lot of opportunities that we have had to say to in the past. Now we get to say yes.

And then just being weird and creative. We've had to kind of, we wanted to visit our family and fly back home for Christmas. So we've gotten, we've been on phone calls for hours with the site company to get the prices and the connections where we want them.

So budget, saying no, and being creative and weird is what works for us and what we think the secret is. I think that's great. Well done, you guys. Very well done. What was the hardest part for you all? That's a good question. I mean, it has to be doing without throw pillows, right?

We are kind of living a bit more adventurous life, or have different opportunities that come up with where we live, and we've had to say no quite often. Yeah, and I think that, for me, has been the hardest thing. Yeah, I'd agree. Not seeing a family as often as we'd like, or if I trip, and things like that. Yeah, very tough. Wow.

Cool. Well done, you guys. I'm proud of you. Did you have people cheering you on? Yeah, quite a few. Some people definitely thought we were weird and gave us a hard time, but we are pretty proud where we are right now, so it was all worth it. Well, you're definitely weird.

We love it. Congratulations. Well done. Well done. All right. proud where we are right now so it was all worth it well you're definitely weird we love it congratulations well done well done all right patrick and callie we've got a copy of chris hogan's book for you retire inspired we'll send that on over to kenya and uh that'll be the next chapter in your story for you guys to be millionaires and outrageously generous as you're going along and hey enjoy the enjoy the adventures now that you don't have debt payments that's awesome very cool stuff yeah thank you thank you patrick and callie calling in from kenya that's our first kenyan debt-free scream i can officially say that 77 000 paid off in three years making 34 up to 96 count it. Let's hear a debt-free scream.

Three, two, one. Fantastic! Well done, you guys. Very, very well done. Absolutely amazing. Fabulous, fabulous, fabulous. Stacy's with us in Ann Arbor, Michigan. Hi, Stacey.

Welcome to the Dave Ramsey Show. Hi, Dave. Thank you so much for taking my call. Sure. What's up? Yes, we are on Baby Step 7, and my husband and I both fully maxed out a Roth IRA as well as my husband's 401K plan. His 401K has just offered us, they're offering the Roth IRA now and I'm just curious are we able to contribute to both his Roth and our regular independent Roth that we're investing in yes we are yes okay now his 401 we're able to invest 18,000 per year, can we put $18,000 into the Roth as well?

No. You can put $18,000 into a 401 Roth, yes. Okay. Yes. Now, do they match? They do not. Okay. They cannot match with Roth dollars.

They will match with traditional 401K dollars, and then once a year, you can move those before-tax dollars into your Roth and pay taxes on them with no penalty. Okay. And that's what I do with mine. We can do the $18,000, and then as well, we can still do our independent $5,500 per year. Yes. How old are you? 45. Okay.

Yeah. You can do $5,500 each, and you can do the $18,000. You can get the full match that is not in the Roth, and then once a year roll that portion of the match also into the Roth, 401K. That's what I personally do with mine. And then you have to pay the taxes on that portion, too, which effectively is an additional investment. Correct. Okay, great. Thank you. Correct. Okay, great.

Thank you very much. Hey, great job. You're killing it. You're going to have some serious money piled up. Very well done. Richard is with us in Boston. Hey, Richard, how are you? Good.

How are you, Dave? Better than I deserve. What's up? I'm just wondering. My parents, they're fortunate enough to have a great deal of money and no debt, and they would like to buy me a car. But I have $15,000 in my own savings, and I'm wondering, is it the adult thing to do for me to purchase a car on my own, or to pay for half, or to do something like that? Are you adult and mature with the rest of your money?

Well, I'm 19 years old, so this is just summer money and i'm not really living on my own or anything i'm just a college student okay all right and they're going to buy you a nice car and they're wealthy people yes and there's no strings attached there's no debt involved nope they purchased one for my sister and they say we want to be fair we'll do one for you too and it'll be in your name uh i believe it will be in their name just for the insurance to keep it a little bit cheaper until what um i think with my sister when she turned 25 they said you're on your own now okay all right um and how wealthy are your parents how What's their net worth, probably? Millions? Millions?

I'd say they easily make $200,000 a year of sold income. And are they worth several million dollars in net worth? I'd say at least two. Okay. All right. And how expensive a car are they buying you? They bought my sister, I think it was $22,000 out the door. Okay.

That would probably be the same for me. No, I don't think that's going to damage your character. I think you're going to be fine. Because of the way you've asked this question, and because of the conversation we've had around the question, it indicates that, you know, A, you're concerned about it, B, you know, you want to be a grown-up and on your own and that kind of thing. I will give you a piece of advice, because I did the same thing with my kids as they hit that age.

I put the car in their name because if the car's in your parents' name and you have a wreck, they can be sued and they have money. You don't. So I would pay the extra insurance and put the car in your name as risk management for them. That way they don't have a target on their butt if you happen to have a car accident. And I did that with mine. So, just an idea.

This is the Dave Ramsey Show. Meredith is with us in Portland, Oregon. Welcome to the Dave Ramsey Show, Meredith. Hi, Dave. Thanks so much for taking my call. Sure. What's up? My question is about downsizing my house. I am a single mom, and I've got three kids in various stages of going off to college,

and their dad and I have an agreement that he will pay their tuition, so I don't have to think about that. I just have to get myself set up for the future. So I'm currently on baby step number two, but the youngest goes off to college in two years, and I'm trying to figure out if I should downsize my house and sell it and buy a condo. And I guess the main reason I'm considering it is that my house is worth about $425. It's really gone up in value since I bought it,

but I worry about downsizing and not having a place for the kids later on, and also a lot of the condos in my area have high HOA fees. And I just wondered if you had any thoughts about that. I would not keep a big empty house for people that might come visit someday. I would keep a big empty house only if you want a big empty house. Sharon and I are empty nesters. We live in a large home, but we enjoy the home. We use it for all kinds of events.

We use it for friends. Our family comes. But we did not, you know, we built it as our kids were leaving home. We upsized as our kids left home because we wanted the house, though. It wasn't, you know, that. But if you're thinking, oh, I need a place for them to stay, the three nights a year, they can stay in a hotel. I mean, you can figure that out. You need to build your life around you, not around people who might visit.

So what do you want two years from now? Okay. What do you want two years from now? Okay. Okay. What do you want? My main worry is that my mortgage just feels like unreachable. Like it's this, there's no way, like I feel like I'm never going to have it paid off. So that's my main motivation. How much do you owe?

I owe $290. And what do you make? I make about $60 a year. How old are you? I'm 46. Okay. And so if you want to downsize to have a smaller mortgage and less property to maintain, and you can find something with the HOA fees that seems reasonable to you,

and the big trick there is also make sure the HOA is being managed well. Probably 50% of them are horribly managed. How do you find out about that? You're going to have to dig in with the management company that's managing it and actually look at the budget before you buy. Because you can buy into something and it's been mismanaged and the HOA fees will go through the roof because they have to come back in and clean up the mess that the HOA didn't take care of before.

Like if they're not putting money aside for roofs and then they have to put a roof on the whole condo, all of a sudden that's going to show up as special assessments. You see what I'm saying? If you don't do your capital reserves and that kind of thing and get ready. So you've got to look at that kind of stuff. A good real estate agent, a good realtor can help you analyze the HOA and make sure it's being run well. And I would be concerned about that, especially since you're concerned about the high fees.

Okay? Right. And high fees can mean that it's just a high cost in the area to manage some of the attributes that the HOA is providing, some of the amenities that they're providing, but it can mean mismanagement. Okay. And I'm involved in, I mean, we own a bunch of property and we're involved in a bunch of different HOAs, and I would say 50% of them suck. They're just bad.

Wow. And it's always got some guy who doesn't have a life who's too much involved you know one of the homeowners he's really like barney fife he's got his one bullet and he needs a job you know he needs to get a life and they're like involved worried about everybody's bushes and stuff you know it's just crazy there's all some you know some where you park there i can't believe you parked there there's always some barney fife involved so you just have to be you got to know what you're getting into with an HOA. Can you tell I'm not a fan?

I'm not a fan of HOAs. Yeah, that's what I was just, is it, do you advise? I'm not, I mean, my house that I live in has got an HOA, you know. But there's one benefit to living on a piece of ground. You don't have to put up with that crap. You just manage your own stuff, you know, instead of having everybody else in your business. And it's just, it's Peyton Place half the time. And we're, like I said, we're in a bunch of them.

Some of them are nothing. You know, I never hear from them, and they manage things well, and the budget's proper, and no issue at all. And then others, there's something going on all the time. And it's not not even to me. My stuff's fine. I take care of my stuff. But there's

always some kind of drama and so you just want to look at that and the good real estate agent can tell you all that and um and they can also tell you if you're there but it sounds to me like you like the idea of a lower price and less square footage to manage and heat and cool the only reason you would keep the house you're in, what you described to me, would be for people that are going to come back and visit, and I would never do that. Let them get a hotel. You can buy them a really nice hotel room and pay for it cheaper than you can maintain all those empty rooms 12 months for them to stay there four nights.

And it just doesn't make sense at all. So, hey, thanks for the call. Sorry, I got on my HOA soapbox. All right, let's see. Tony's in Chicago. Hi, Tony, how are you? Hi, David, it's a pleasure to speak with you. How are you today?

Better than I deserve. How can I help? I have a concern in regards to my parents. Actually, in 2009, they lost their house due to the whole housing crisis. So the last eight years, they were bouncing around between renting houses and living with family. And then the last two years, they lost their house through the whole housing crisis. So the last eight years, they were bouncing around between renting houses and living with family. And in the last two years, they bought a house. I don't believe that they can afford it.

I just saw the mortgage statement, and they are late on their mortgage at least one month, maybe two months throughout the last two years. I'm not really sure what to do about that. They have no savings for retirement no life insurance are they inviting you into the conversation? no no I'm kind of subtly playing your podcast

while I drive my mom to work to try to give her the hint like hey you guys should probably get your life together so we're not stuck with no burial costs and things like that well it's hard to watch people you love do stupid stuff together so we're not stuck with no burial costs and things like that. Well, it's hard to watch people you love do stupid stuff, and they didn't lose their home in 08 due to the housing crisis.

They lost their home in 08 because they were in a situation they couldn't hold the house. I didn't lose my house in the housing crisis. You didn't lose yours in the housing crisis. So they lost it because they made bad decisions, and now they've made another one is what it sounds like. Have they got a home they can't afford, or have they not managed the money well? They're not managing money well. Together, my mom and dad probably bring home about $40,000 total. That's probably $20,000 less than they were making when they lost the house in 2008.

And what do you think this house payment is? It's about $1,100. Pretty steep for $40,000. Yeah, he's got a 72-month car loan on his current car, which is probably a couple hundred plus he's got a loan on a car that's in the garage that doesn't even run. I'm sure credit card debt up the wazoo. So it sounds like you know what they should do, but the trick is getting them to do it. Correct. Yeah. Okay. All right. Well, the only way I know how to enter a conversation like this is you can't use your son, I'm scolding my older parents voice. Okay.

You get the powdered butt syndrome. Once somebody's powdered your butt, they don't care about your opinion about money or sex. And so your parents weren't really asking. And so it's just like, let's pretend they're not your parents. Let's pretend you've got some older friends at church that are the same age, and you were observing this behavior. How would you approach them? Very delicately, would you agree?

Correct. And instead of driving a bulldozer conversationally through the front of their mouth, that won't work. And so just your only option is persuasion. And the best persuasion. And the only way I, the best persuasion I've ever seen is stuff like you're doing, and that's, you know, leave a book on the coffee table, drop a podcast out there, that kind of thing. But the other thing you can do is just start telling them about the times that you made mistakes and how bad you felt, how ashamed you felt, how scared you felt.

And then when I stopped doing that, I started getting on a budget, and I cut up my credit cards, and I sold this car. And whatever your story is, don't talk about what they're doing that's dumb. Talk about what you used to do that was dumb and how bad it felt and how you don't do it anymore and how great it feels now. And now my wife and I are getting along a lot better if you're married. And, you know, now we're on a budget and our communication's way up. And, wow, and it's just talk about, because they can't really,

your story is not condemning to them, it's inspiring. But if you ever had a friend that lost weight and they tell you about their story, it makes you want to go get more fit, right? But if they come in wagging their finger and go, you shouldn't eat that pizza, then I'm like, hey, formerly fat person, get away from me. I'm eating my pizza, you know? And so, you know, don't be that guy, right? That's what we're talking about here.

So I'm proud. I'm glad you lost weight. I'm glad you got control. But don't come busting into my life, busting my chops, without permission. You have to get permission to enter people's lives. That puts this hour of The Dave Ramsey Show in the books. Hey guys, this is Blake Thompson, Senior Executive Producer of The Dave Ramsey Show. Did you know over 15 million people listen to The Dave Ramsey Show every week?

And a lot of those people listen to one of over 600 radio stations across the country to find a station near you head to daveramsay.com slash show