The Ramsey Show - App - You Don’t Escape Debt by Waiting—You Escape by Acting

Starting point is 00:00:12 Normal is broke and common sense is weird, so we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studio, this is the Ramsey Show. Ken Coleman, number one bestselling author, Ramsey Personality, host of the big hit on the Ramsey Network called Front Row Seat. He's my co-host today. The phone number here is AAA 825-5-225. Pat's in Boise, Idaho. Hey, Pat, how are you? Hi, Dave. Thanks for talking to me. I'm the executor for my dad's estate. About six months after his death, I received a letter looking for the person who could act on his behalf. I looked up the company, and it's a debt collection agency primarily focused on collecting debts related to deceased individuals.

Starting point is 00:01:01 Wow. They utilize technology. Yeah, I've never heard of this either. They utilize technology like probate, finder on demand to identify and contact the personal representatives of the state to recover unpaid debts. So my dad absolutely did not have any debt. He was Dave Ramsey while Dave was running around in diapers. He didn't borrow money. I do know that there is, just from looking at unclaimed property, I do know that there's a gentleman who lived in the same metro area as my dad for many years who had his exact name, first name, middle initial, and last name.

Starting point is 00:01:34 So I'm thinking, I don't know, maybe they're looking for that guy. Here's the deal. I don't even want to talk to them. I don't want to spend time on this. I don't know if you need to know the name of the company, but how worried do I need to be? Well, I mean, is the estate settled? The probate is finished, but it's not closed yet. I haven't closed it.

Starting point is 00:01:58 Okay. What is lacking for it to be closed? Nothing. I was just doing some final insurance policies and transfer of his property to my mother. So if that is done, I can close the estate at any time. as far as I know there was nothing that came up during the probate. So your mom's still there and she's sitting with whatever assets that they had? Yes.

Starting point is 00:02:22 Okay, good. Okay. Well, I don't know Idaho law and I'm not an attorney anyway, even if I did, but most states have a period of time that a creditor can file a claim against an estate before, after, or during the probate being open, okay? And I don't know what yours is. Okay. So if they didn't, I'm probably good.

Starting point is 00:02:49 Probably. Okay. From a legal, practical standpoint, or from a legal standpoint. From a practical standpoint, these folks, they have one little thread that they're hanging on, and they're going to pull that, thread and pull that thread and pull that thread they're eventually going to end up hassling your mom probably so from a practical standpoint i would put them down i'm i'm her power of attorney so they

Starting point is 00:03:21 won't get much further i know i know but if they start calling her start mailing filling filling up her mailbox with stuff i don't think there's a legal issue i don't think they've got a claim you don't think they've got a claim they're probably outside the notice of meeting the creditors period of time all that kind of stuff, but that doesn't keep them from driving everybody in the soup crazy, okay? So I probably would invest a few minutes and just shut them down. How do I shut them down? I would just call them and say, he did not have any debt with you. I'm the executor of the estate, and you can give me a social security number, send him a copy

Starting point is 00:03:59 of the death certificate. None of that hurts you in any way. And, you know, I'll give you the last four digits of social security numbers, if it matches with what you think you're hunting, but I think you're hunting this other guy, and you need to stop. And if you don't provide me proof of written proof of debt, and you don't stop, I'm going to sue you under the Federal Fair Debt Collection Practices Act, because you're violating it now that I have told you that I am demanding proof of the debt.

Starting point is 00:04:31 Can I just demand proof of the debt without providing them anything to start with? Well, I've given the last four-digit social security number. What I'm trying to do is in case there's two brain cells on the guy you're talking to, if they happen to rub together, you want to give him a way to go away. Oh, it's not him. I got to go the other way, okay, right? But in case they're, in case they, if they think, but the problem is some of these companies and what you need to be prepared for is, and I think you're kind of already there,

Starting point is 00:04:59 is they will try to collect from someone that they know is not legitimately the debt just by hassling them. And that's what I'm worried about. Yeah. Well, I'm not worried about it because you're going to shut them down. We're not going to talk to them anymore. Okay, we're going to block them. And if they continue to pursue, I would have an attorney send them a letter under the Federal Fair Debt Collection Practices Act. Because they're in violation of federal law if they continue to pursue after you show them that it is not his debt and you give them the last four digits Social Security number and they don't provide proof of debt.

Starting point is 00:05:31 The other thing that's going to come up is they probably don't have proof of debt. they probably bought a line item on a spreadsheet. A lot of debt buyers don't get the actual documentation on the debt. They just get a line item, point of last contact, some details about a name, whatever the file's got, and it's just a whole list of line items. It's not like they have a file on him. So the point being, I don't think they can provide proof of debt. But I'm going to ask because I'm going to make one or two phone calls with these people

Starting point is 00:06:04 and try to in a civil way make this go away. But if you determine that, A, they're trying to collect from somebody, just anybody, and they just think they can hassle you, then just pound their face, right? And then, or B, that they cannot provide proof of debt, and they won't go away. What I'm more than anything trying to do is get them to quit calling you and quit calling your mom.

Starting point is 00:06:25 And it's worth two phone calls to invest in that, or never call your mom. Okay. Right, I like that. Okay. Yeah. And then, but again, write that down. It's the Federal Fair Debt Collection Practices Act. Okay.

Starting point is 00:06:40 And it is federal law that they're violating. If you demand a proof of the debt, they don't provide it, and they continue to attempt collection. Hammer them. I was looking for something to add. You covered it from every angle. You know, look, you got the facts. And so don't be afraid to take this on and then shut it down.

Starting point is 00:07:00 I think that's what this is. I don't think this is harassment. I just think Dave's nailed it. They don't have a lot of info. It's not harassment yet. No, yet. Probably is going to be there if it doesn't stop. That's right.

Starting point is 00:07:10 So the thing is, folks, you got to do debt buyers when they buy debts are typically paying anywhere from two to eight cents on the dollar. So they're paying $80 for a thousand dollar debt. And they can't even find the people in most cases. In this case, they're chasing deceased people's debt. Okay. So they're always trying to chase down the, um, this is basically. Basically prospecting. Yeah. Yeah. They're dialing for dollars all day long. And, you know, it's a horrible job. And here's a, here's, you want to be worse than somebody trying to collect on an old

Starting point is 00:07:42 debt. Collect on an old debt that you know the person is dead. Right. I mean, this is a bad job. Degs. Cleaning septic tanks is more fun. And so honestly, seriously, oh my gosh, what a horrible position. So they probably got high turnover. You got a boiler room, a phone room going. Looks like something on Wolf of Wall Street or something. That's right. And they're just, you know, And the average time on the job is 21 days. And they're just constantly hiring new people that are dialing for dollars. You're probably not going to talk to the same person twice. And they're brainwashed, by the way.

Starting point is 00:08:12 They come at you with a script. Oh, yeah. And so that they don't get knocked off. So you've got to really be strong and show a lot of facts. And the other thing is the neat thing about the technology is you can just hang the phone up. Just push in. That's always enjoyable. And then slide that little thing over that says block.

Starting point is 00:08:28 And you're done. They're done. Ken Coleman, Ramsey, person. personality is my co-host today. Thank you for joining us, America. Open phones at AAA 825-5-2-2-25. Frankie, Frankie is in Greenville, North Carolina. Hi, Frankie. How are you? Hi, Dave. I'm good. How are you? Better than I deserve. What's up? So I have a pretty straightforward question. I talked to my dad yesterday, and he wants me to pay for his life insurance policy.

Starting point is 00:09:43 He said, I should think of it like an investment, and he doesn't want to actually pay for it himself. So I just wanted some advice on maybe how I can talk to him about paying for his own life insurance, or should I pay for it myself? That's so weird. Isn't it? Yeah. When you heard that, you had to go, say what?

Starting point is 00:10:14 I don't know if you said it out loud, but you said it in your head, didn't you, Frankie? I did, and he said it to my mom, and he said, you know, because he's not going to be receiving any of the benefits, I was like, well, I mean, that's kind of the point. He was saying, since he's not going to be receiving it, I should pay for it. How old are you? I'm 24. And how old is he? 65

Starting point is 00:10:43 Is he ill? Not necessarily I mean he has some health issues But I mean But his death is not imminent As far as we know Right Yeah

Starting point is 00:10:56 Yeah So you could be doing this for like 30 years Yeah Yeah I think that's a hard pass That's a big NO Nope nope Let's just call that

Starting point is 00:11:09 Let's check the box besides nope. Now, your question was, your question was, though, how do I talk to him about it? Just go, Dad, you know, I'm 24. I'm going to be doing other kinds of investing rather than in your death. And I don't think we're going to go this way, but thanks for the offer. Yeah. Okay. Yeah, I think that. Pretty simple. You don't need to be snarky about it, although it's really tempting. But it doesn't serve any purpose. Just be simple. snarky about it other than it make you feel just because it's just strange and he knows it's strange

Starting point is 00:11:45 and i don't know your dad does stuff like this often doesn't he yes yeah he's got quirky quirky quirky dude okay yeah i just i would just smile and say dad you know thanks for the offer i've kind of thought about this and i talked with my financial guys and they said i should just be doing regular investing rather than investing in your death and i'm just not comfortable doing that and so but thanks for the offer no and I really wouldn't go into a bunch of I wouldn't go into a long lengthy discussion about it it's just a two sentences and no but what I'm going to do is I'm going to play this back for him later okay that's fine you could tell him I said obviously he's quirky but because that's a really quirky thing to say to your 24 year old daughter dude if you're

Starting point is 00:12:31 going to play it for him I mean I wouldn't do that to my 24 year old daughter you've got other things you should be doing with your life rather than investing in your dad's death I mean And besides that, mathematically, it's a bad investment. Because insurance companies make money on insurance. Right. The probability of his death and the payout is less than the premiums that they think they're going to receive. If they don't receive premiums equal to the payout before he dies,

Starting point is 00:13:02 they lose money on the insurance. And if they do that often enough, they go out of business. So insurance companies make money on insurance, which by translation means it's not a good. investment. It is a good purchase for those of you out there. We had a debt-free scream yesterday, I believe, or a day before yesterday that the young lady's husband was killed in a car wreck who's 30-something years old. Two months before they were debt-free, two months before that, he had gotten life insurance and he had a brand-new baby. Now, that's a good time to buy life

Starting point is 00:13:34 insurance. That's perfect. I mean, that family's taken care of because that young man was just a stellar dad and husband. But this is a completely different thing. It's not a good investment mathematically. It is a protection for your family in the case of a horrible event happening. But if your dad doesn't, he's 65, he may not need life insurance. If he's got enough money, he could not just not buy life insurance. I'm 63.

Starting point is 00:14:00 I don't have any life insurance. I have a huge pile of money and no debt. If I die, Sharon's going to have a party. She doesn't need life insurance, okay? and it'll be a big party. I guess not if I die, when I die. If I die before her is what I should say, right? Well, we will celebrate here.

Starting point is 00:14:18 We know that that's her plan and I'm a little worried about it. Yeah, I mean, the data probably backs that up. I would just say this, that this is just like common core math. It just doesn't make sense and we already have good math. We don't need to invent something. This is just a wacky idea. The minute I heard it, it's just wacky. Yeah.

Starting point is 00:14:37 And you can't, by the way, reason with wacky. you just got to move on quickly. Yeah, I wouldn't. No, Dad. No. You didn't have to deal with Common Core Math, and I'm glad because it would have made the top of your head explode. It must have been what happened. Okay. Joel is in Chicago.

Starting point is 00:14:55 Hi, Joel. What's up? Hi, guys. Pleasure to talk to both of you finally. I have a question about a debt question. I just started listening to you guys a couple weeks ago. I've been watching your podcast or listening to your podcast so like every day nonstop. So me and my wife been talking about this and we're getting ready to start the baby steps. We have the 1,000 already set. The issue that I'm having is, is I can get you guys some quick numbers real fast.

Starting point is 00:15:28 We're about 25 to 30 in credit card and personal loan debt. We have about 31,000 in two car loans, 122 in our mortgage. and we have a second home, which is our first purchase, that still sits at about $40K, and that's being rented currently. And so... What's your household income? We make around $140,000 combined before taxes. And your question is simply how to start the baby steps? Yes.

Starting point is 00:15:57 Okay. We get on an every dollar budget. You and your wife are in agreement that we're going to get out of debt, and we're going to sacrifice to do that, because if you didn't have any of these payments, you'd have a lot of money, agreed? exactly and that's the whole idea and so do you have any savings that's not in retirement no um just just the 1k for the startup you got the baby step one okay then we're going to list all these debts smallest to largest we're going to pay minimum payments on everything but the little one we're not going to see the inside of a restaurant unless you're working there as an

Starting point is 00:16:29 extra job and you're not going to go on vacation you are broke people that make 140,000 a year, and you need to clean up this $70,000 worth of stupidity before you do anything else. Stupid butt car loans and all this other mess you've got. And you've got to get disgusted about it and attack it and attack it and attack it to where your friends think you've joined a cult. I agree. The one thing I didn't want to mention is, like, the one car loan, we owe $2,000 on it, so that will be gone in, like, the next four months.

Starting point is 00:16:59 Good. No, no, no. It doesn't take four months to pay off $2,000 when you make $140. You do that the first month. Yeah, I agree. I agree with that. The second thing is the second car is our second vehicle, which is an SUV. That one's the one that's that's sitting in about $29,000.

Starting point is 00:17:16 And I told my wife, we need to just get rid of the car. And that's where she's kind of, right on it. I wouldn't. I wouldn't. I don't think. Okay. The best way to get your wife on board is not say I want to sell your car. Well, that's actually just like a weekend vehicle.

Starting point is 00:17:30 I drive a personal, I mean a work vehicle Monday through Friday. Is that your car? It's kind of both our cars, but we use it because we have three kids, so it's a larger vehicle. Okay. So you have a work car? Yep. That you own? It's a company vehicle, but I think it's a company vehicle.

Starting point is 00:17:46 Oh, okay. Oh, no, so it's a company vehicle. Okay. And then she has a car. Yep, which is the one that's about to be paid off, and that's a community vehicle to work every day. And then the other one has 29,000 owed on it. Yep. Well, her car that she owns carrier family?

Starting point is 00:18:02 Yeah, we'll. fit. I mean, my oldest is about to finish high school, and the other one, the smallest one is like 10 years old. I mean, we fit. Not much space, but I told her, you know, something we could do if we wanted is just... Yeah. The other thing you could do, what's the rental worth? Um, uh, I think about one, 120, 1.30. Yeah. You could dump it and clean up the whole mess, but, um, either one of those is fine, or, or neither, if you want to just bust all the way through it. You're going to trade sack. sacrificed lifestyle, scorched earth lifestyle, longer, you're going to stay in the mess longer

Starting point is 00:18:40 if you don't move one or both of these other items. And that's the decision the two of you can make together. This is the Ramsey Show. Ken Coleman, Ramsey Personality is my co-host today. Thank you for joining us, America. The best way to make the most of your money is a plan. Tell your money what to do instead of wondering where it went. Most people, the money comes in, the money goes out.

Starting point is 00:19:35 Only the names are changed to protect the innocent. We don't know where it went. That's most people. And then you scratch your head and wonder while you're broke. If you ran a company and your job was to manage money and you manage money the way you manage money for you, you'd get fired for incompetence. So, because if you work in a business, you're supposed to have a budget. And then you're supposed to like stick to it and stuff. Hello.

Starting point is 00:20:03 That's kind of basic, y'all. I mean, it's really not hard, but it's hard because it's dealing with me, and I got to look at the teenager and go, no, and I got to have a discussion with my spouse about spending, and, you know, we got to quit eating out every freaking night of our lives and then wondering why we have no retirement because we're eating it. That's why. Basic stuff like that comes up when you do a budget. Hello. That's why we came up with the idea that every dollar needs an assignment. Every dollar needs a name.

Starting point is 00:20:40 Every dollar of your money before the month begins needs a mission beside it. You need to send it out there to do stuff for you. You work too hard to be broke. And the only thing that fixes that is giving every dollar an assignment. That's why we named the world's best budgeting app, every dollar. And that's why tens of millions, no exaggeration, tens of millions of people are using every dollar every month, the budgeting app to run their budget with their spouse. Download every dollar for free in the app store or Google Play or go to every dollar.com. And let's get started, boys and girls. It's time to do this. Open phones at AAA 8255-225.

Starting point is 00:21:26 John's in New York. Hey, John, how are you? Hi, Dave. How are you, sir? Better than I deserve. What's up? Good. Good. So I'm around 23 years old, and I had around 57,000 liquid cash in the bank.

Starting point is 00:21:42 And I got kind of screwed over by the car industry twice now. When I was 19, I bought a new Mustang on site, very bad mistake. And obviously, I was upside down, and then now I have a Cadillac. Obviously, I got a pre-owned. And now that loan is around at 35,000. I just got it about eight, nine months ago. And then I have student loans of about 25,000. They're not crazy high because I went to community college.

Starting point is 00:22:10 I've been listening to you guys for a while. And I just wanted to hear of thing with that. What do you make? Around 80,000. What do you do? I'm a bartender at my family's restaurant. Okay. Very cool.

Starting point is 00:22:24 Very cool. Thank you. Okay. And so your question's what? Should I? Because I've watched a couple of your videos if I should just take the $57,000 and dump it into all the debt and just clear it. But then I have nothing left in my account. Or do I, like, do thousands out of time and knock it down as quick as I can?

Starting point is 00:22:47 Okay. Is your goal to be wealthy? Yes, yeah. Okay. Because you make a lot of money. You're doing really good. Thank you. You must work really hard. I do, yeah. I work six days a week.

Starting point is 00:23:03 Yeah. And some serious hours, too. Yeah. Good for you. Thank you. Good for you. I mean, you're a pretty sweet spot for 23 years old overall. I mean, you've done some stupid stuff. So, all right, a couple of things that come out of the conversation is, one, you did not get screwed by the car industry. You got screwed by you. Because you walked on to the car lot, and you bought a car you couldn't afford because you were acting like a child. Is that fair? Yeah. Yeah, of course. Okay, you're not a victim, dude.

Starting point is 00:23:30 You cause this. All right. Both times. So I don't know what a guy making $80,000 that's 23 years old working his butt off needs with a $35,000 Cadillac. I don't know why you have to have that. Right. You might rather have the cash than that. Right.

Starting point is 00:23:53 So one option, sell a car and buy a $10,000 car for cash. and then you don't have to give up all your cash, you just give up the Cadillac. That's the main thing I want to avoid is I don't want to just deplete all my savings I worked for. Yeah, well, I mean, then the Cadillac is on the block. So, I mean, if you want to keep the Cadillac, you need to pay it off. Right. See, your money's already gone. Paying it off, you just admit it.

Starting point is 00:24:25 Yeah. You've already spent the money. You just hadn't admitted it yet by paying off the debt. Of course, yeah. So, you know, it's so you can, but you can, you can choose, okay, do I want, because basically if you sold the car for 35,000 bucks, um, and you took $10,000 of your, and you broke even, got out of it, cleared it, right? Will it bring 35?

Starting point is 00:24:50 No, I think it'll bring 24 because I got, I was upside down from the other one. Oh, you rolled negative into it. Okay. Yeah, I was around 9,000 negative. And then I put five. So you're going to spend 10 of your money even if you sell it. And you're going to spend another 10 of your money to buy a car. And you're going to spend some money to pay off the student loan debt.

Starting point is 00:25:08 Right. And you said, so you said 25 in student loans? Yes, sir. Okay. So you're 60 and you got 57. So you don't have enough to pay off everything. Yeah. Quite.

Starting point is 00:25:21 But, I mean, you're making money and you're used to stacking cash because you, so, all right, the premise is this. if we could get you where you had no payments, student loan and the car payments gone through whatever mechanism, either paying it off or selling the car, either one. You choose, okay? If we can get you where you don't have any payments, but most of your money is gone, without any payments making $80K,

Starting point is 00:25:44 you could stack that cash up real quick again. It won't take long, just a few months. I mean, you probably save $5,000, $6,000 a month, can't you? If you don't have any payments? Yeah. Are you living at home? Right. I am, yeah. Me and my mom and dad live above the restaurant.

Starting point is 00:25:59 Yeah. So you got almost no overhead. I thought that. Okay. So that's how the 57 got there. I got some quick numbers here. I want to run with you here. I think you're still walking away with Dave's plan with $11,000 in cash. Because if you owe 11, so you're going to pull 11 out because you're upside down, you're going to spend 10 on another car. So that's 21. 57 money, 21 is 36. We owe 25 in student loan. That leaves you with 11K. And no payments, no payments in a paid-for $10,000 car. And you live at home with a pretty secure job. And you're stacking cash like a boss, man. Right. You could, you stack $6,000.

Starting point is 00:26:37 I mean, in 10 months, you'd have $60,000 on top of the 11. You'd have $71,000 in 10 months. I mean, I also have $10,000 in an IRA that I'm maxing out every month as well. I would stop that until we get this mess cleaned up. But if you're going to clean up the mess in one fell swoop, you don't have to stop it. But you can stack cash. You follow me, especially if you don't have a car payment, it's $35,000. Yeah.

Starting point is 00:27:01 And so, you know, I'm going to use up all my money, yeah, for a hot second. Mm-hmm. Because a month later, you're going to have $10,000 more. And a month later, you're going to have $8,000 more. And a month later, you're going to have you follow me? Gotcha, yeah. Yeah, so you're not going to be out of cash for, but just for a few days. Well, you still have $11,000.

Starting point is 00:27:22 I know, you got 11, but I'm saying he's 57s down to 11, and that's causing emotional distress. Heartburn. Heartburn, yeah. Right? Yeah. Yeah. So, but the point is it's a temporary situation and it's the best path for you to become

Starting point is 00:27:37 wealthy. Right. Because your most powerful wealth building tool is your income and you don't give it all to car companies and student loan companies. You get to keep it. Right. And that causes wealth building. And that's what I'm going to tell you to do.

Starting point is 00:27:50 So I would be debt free either by selling the Cadillac or not immediately. even if it caused my heart to burn and keep in because keep in mind your heart's not going to burn for very long because with no payments and serious motivation called a little bit of fear you're going to stack that cash real fast and you'll be right back where you are by Christmas and you'll be a whole 23 years old wow you got lots of time to be smart now this is the ramsie show Student loan debt is an epidemic, and defaulting on debt makes you feel even worse. But our question of the day sponsor, Y. ReFi refinances defaulted private student loans and builds a custom loan based on your ability to pay. You'll have a payment you can afford with a low fixed interest rate.

Starting point is 00:29:33 You couldn't get anywhere else. So go to whyrefi.com today. slash Ramsey, that's the letter Y, R-E-F-Y dot com slash Ramsey, might not be in all states. Today's question comes from Kate in Maryland. My daughter is a junior in high school and has no idea of what she wants to do when she graduates. My husband, I love the idea of her owning her own business, but neither my husband nor I have experiencing this. We both wish we had made different career decisions that would have given us more independence.

Starting point is 00:30:01 Where can we research with her to get a better understanding and vision for this option? or would you still recommend college versus real world experience? Okay, I'm going to put myself into this particular situation, say if this was my daughter, what would I do? And so because she's a junior, we would begin to identify areas of interest, not come up with the business idea. I think this could be very paralyzing for a youngster.

Starting point is 00:30:26 It's paralyzing for a lot of people in their 30s and 40s because we know, Dave, from the data that 70% of Americans want to be self-employed, but only 6% are. So I'm speaking from data here. So what I would do with my daughter is we would begin to identify areas of interest. In other words, people that she wants to help, solutions she gets excited about, problems she wants to solve. And there's an industry.

Starting point is 00:30:53 If there's a business, there's an industry. And so we want to get broad so that she gets some real interest and begins to see some areas of interest. At that point, we're going to shadow. I'm going to allow her to go have coffee, lunch with people that are in those industries, or maybe run businesses in those industries, shadow at work, if she can get shadow opportunities, all of this to begin to create a field of three or four of her most interesting options. At that point, then we start to have the discussion, is college is a degree the best decision? or is it getting right into the workforce and working in an industry? Giving an example to help clarify this some more if this were a young man.

Starting point is 00:31:36 And by the way, it's not limited to young men, but let's say she decides she wants to own a business in the trades. At that point, then I want her shadowing folks that are working in those trades and getting a real world experience. The good, the bad, the ugly, the smelly, everything. and at that point we determine whether or not she's really interested. And then the path is going to be to go to work and hustle and learn on the job and eventually you'll work your way into spinning off on your own and starting your own business. So that's a hard question to answer in such a short amount of time without back and forth. But that would be the advice that I would give because that's what I would do.

Starting point is 00:32:17 These young people need to see it, touch it, experience it, smell it. And then they can decide. Completely agree. Because, Kate, you did not say she has this extreme, passion and apparent natural talent and bent towards X, because you did not say that, that would have led her towards a business. The people that we've talked to that are 18 or 19 or 21 years old that have had success and they call this show and they are really killing it

Starting point is 00:32:50 and we're all kind of aghast at how far ahead of this curve they are running their own thing. They almost always had a natural gift towards something. Technology is not unusual for a 19-year-old today to be something that they would go, you know, they've been screwing around writing code, messing around building apps, and all of a sudden they built an app and took off and around a business, okay? Or, you know, whatever. That's fine. I mean, that would be Michael Dell.

Starting point is 00:33:18 That would be Bill Gates, both quit college and Steve Jobs, all three. All three companies were formed by college dropouts. And so, but they were super nerds with their eye exactly on what they wanted to do. That's true. There was no question. Instead, you're asking a very generic thing. My husband and I always wish we were in business, so we wish our daughter would go into business, but none of us have a clue. Yeah.

Starting point is 00:33:45 That, no, don't go in business. Business is too hard. That's correct. Don't, don't put an 18-year-old, 20-year-old out there with no education to go into business doing that. No, if she thinks or that in talking with her that she has got some entrepreneurial flair and wants to do a business someday, maybe in the future, a great, you know, just get a business degree, get a degree in finance, a degree in marketing. You'll learn accounting, you'll learn statistics, you'll learn marketing, you'll learn strategic

Starting point is 00:34:17 thought. I mean, you'll get some of these basic things in a good four-year degree. That's what I have. and I use a lot of those classes I took 40 years ago every day running Ramsey. You know, it's a $300 million company. It's a dead good, dad gum good thing. I had a couple of accounting classes. Hello.

Starting point is 00:34:37 You know, rather than just trying to figure that out with a high school accounting class. And so it's a good thing that I, you know, understand marketing at an academic level before I actually get neck deep in it and then try to figure out how it works out here in the real world too. So I would do that if she thinks she's going to go that direction, combine with Ken's advice of really go in there and study, study, go visit these places. Quit talking about this stuff in the abstract. Here's what we know about entrepreneurs.

Starting point is 00:35:08 Business is very hard. It is. And people that have never started a small business and run one have this romantic view. Yeah. But there's a lot of dirt under the fingernails, boys and girls. I mean, there's a lot. It's a long hour. It's the hardest boss you'll ever work for in your life.

Starting point is 00:35:24 That guy's a deadgum slave driver. Yeah. And to that point, the entrepreneurs that win are driven by deep, deep desire to solve a problem. And they come up with a solution. That's the business. It's a solution. And they're deeply passionate about it. That's what keeps them going because it is you almost need that magnetic pull or else you're going to quit.

Starting point is 00:35:44 Because in air quotes, I always wanted to work for myself. Yeah. you're not going to make it. No, no chance. It's too tough. You're going to get your butt run over in the middle of street, man. I mean, you're just going to be roadkill. And it's just too, I mean, because you put up with too much, you shovel so much manure.

Starting point is 00:36:01 It's unbelievable. There's a pony in there somewhere, but you got to shovel the manure. I mean, it's real. And I'm not complaining and I'm not whining. I wouldn't, but I have a call for a certain thing. That's correct. And I've had two in my life. I mean, one on real estate.

Starting point is 00:36:17 and went broke and then one doing this, and I could do the real estate tomorrow and still be okay. But obviously God called us to this right here, and I'm happy with that. But, yeah, I wouldn't put up with the BS that nobody will. That's why we see business people quit all the time. It's why we see a chef who is good at cooking and nothing else has a failed restaurant.

Starting point is 00:36:44 That's why restaurants have the highest failure rate of almost any stinking business category. because somebody thinks because they can cook or like cooking for their friends that that makes them a restaurant owner. Now, you got to hire and fire people all day long. Restaurant has a 325% turnover ratio in a year. It means you have to hire three people to fill that one position during that year. So you're in the hiring business.

Starting point is 00:37:10 You're in the firing business. You're in the food sourcing. Inventory. There's all this stuff that goes with running a business. It's not cooking. That's right. And it blows a chef's mind, and they go, oh, God, I wish I'd never. Yeah, we all wish you'd never.

Starting point is 00:37:26 That is a great actual example of, do I want to run a business that serves food or do I just want to cook food? Two very different paths. By the way, both honorable. But there is a big distinction between the two, and that's the key. You know, it's even like when we're talking with entree leaders, these small businesses, and they're getting ready to promote their best salesperson to be sales manager. It's two different skills. That's exactly right.

Starting point is 00:37:48 You're managing salespeople is different than making sales. So sometimes one of the worst things you can do is take your best seller and turn them into sales manager because they don't have that skill set. They're good at selling. They're not good at managing salespeople. And don't forget, they may not enjoy it. They may enjoy the service. They may hate it. They enjoy the service of the customer.

Starting point is 00:38:07 They don't enjoy the service of leading a team of people. Again, too very different. It's like running a beauty partner. That's right. Two very different job descriptions. So, you know, you need to get in there. what it is. So that's a great question, Kate. And we'll have the team send out. I love the student assessment. It would be great for them. Okay. Perfect. Because we've actually got that and that's a

Starting point is 00:38:26 young person can take that and get a pretty good idea of what a current snapshot of what a professional job description of purpose would look like for them. And that can be a business. That's right. I'm completely killing that. But make sure you understand that, you know, business is not romantic. This is the Ramsey Show. Welcome back to the Ramsey Show in the Fair Winds Credit Union Studio. I'm Dave Ramsey, your host, Ken Coleman Ramsey, personality, number one bestselling author, is my co-host today. Chris is in Wyoming. Hi, Chris.

Starting point is 00:39:40 How are you? Good, yourself. Better than I deserve. What's up? I just wanted to give you guys a call. I mean, kind of going through some struggles and with debt, and I got fired for my job on Wednesday. Whoa. So.

Starting point is 00:39:59 That sucks. What happened? They gave me an evaluation, and I guess I didn't score high enough. And I think they fired me because of my hearing issues because I was born partially deaf. And so I think that's part of the reason why they fired me because I shouldn't understand things. Yeah, you're going to speak directly into your phone, sir. You got muffled on me there. But you had trouble understanding things?

Starting point is 00:40:24 What was the job? Yeah. I was working at a casino. I was doing surveillance, and they just am kind of looking at cameras. I'm answering phones, and I think I just wasn't understanding a lot of stuff that I was being told. And they didn't tell me they fired me because of my hearing issues, but I kind of think that's what it was. Well, and the reason I'm asking this follow-up is because this is going to inform maybe some advice we give you going forward. when they went through the evaluation, whether or not they told you that or not, did you agree that you weren't meeting their evaluation points?

Starting point is 00:41:01 Yeah, I do. I do. Listen, you're not speaking directly into your phone again, honey. You don't have to do that. It's muffled. Yeah, so, yeah, I do agree that I was having a hard time understanding things that they were, the tasks that they were giving me. Okay, okay. And so your biggest crisis is you're unemployed.

Starting point is 00:41:25 Yeah. I'm unemployed and my wife can't work because she's, she tore her butt, she tore her femur back when she was in the military and she's using two canes and she hasn't worked for so long. And so it's just, it's been hard to try to take care of her, myself, and our three kids. and um are you aware of are you aware of what kind of work that you can do where the hearing is not going to be that big of an issue um for like 15 20 20 plus years i was doing like physical work like warehouse type work because it really been involved a whole lot of i mean i start to hear things but it wasn't as bad as you know having to like i wouldn't have to like answer phones or

Starting point is 00:42:12 any type of thing like that and um so i've been trying to get back into that again. It's just been, with winter hours coming up, it's just kind of been more harder to get into that again. How did you lose your hearing? I was born. I was born. It was genetic. Okay. Do you have hearing aids? Yeah, I do. I went through the Wyoming workforce, and... But they're not working? They were working. They've been a big help, but even, And even after I got the hearing aids with the casino, I was still having a hard time. So I try to do everything the best I can, and I seem to still have a hard time hearing. Well, the casino is a very noisy place, and even with hearing aids, that can be a problem.

Starting point is 00:43:03 I'm worried about your location. It seems when you said winter hours that you have limited opportunities due to where you are. Is that what I'm understanding? Yeah. I mean, I'm in here in Cheyenne, and they usually when winter starts coming up, that's when they kind of, a lot of places, you know, cut back hours because they're fully staffed and it's harder to get into places. Sure. How much money do you need to make? What's the bottom line that would just take care of you guys, just your basic expenses?

Starting point is 00:43:37 What do you need? I mean, my rent, I mean, it's my rent, my electric. I mean, I don't have to worry about like gas or anything. Give me a number. Do you got a number, a monthly number that you need to live? And in all honesty, I mean, I honestly don't know. Can't really figure out her number. It's usually about, like, I,

Starting point is 00:44:08 I think it's like $3,000 a month. That's usually where all my bills are at. Because I got two vehicles, and then, you know, my kids taking care of the expenses for them, too, and the food and all that stuff. Do you have two car payments? Yeah, I have two car payments. I have my truck payment, which is $740, and then my car payment's $360. I don't know. What in the world?

Starting point is 00:44:36 I'm working with Walmart. I got fired from them the same year in January. Why did you get fired from Walmart? Because of my attendance, because of the wife's medical issues with her leg, and then my mental health. I was leaving a lot, and I was calling off a lot because my mental health, and I ended up after I got fired, I ended up in the mental health. What's the nature of your mental health problem?

Starting point is 00:45:03 Well, when my daughter was born, she, No, you're a mental health problem. What's the nature of your mental health problem? I'm depressed. Okay. And is your wife on military disability? No, she's been trying to fight with the VA for several years. Are you on any kind of disability?

Starting point is 00:45:30 No, I'm not. I try to get on Social Security, and they, They denied me because I finally got the job at the casino, and they denied me because I was making too much. That would be true. That would be obvious. Yeah. Okay. So what we've got to do is we've got to figure out a career where you can make some basic income, and son, you've got to sell your truck.

Starting point is 00:45:55 A $780 truck in this picture that you have painted for the last few minutes is insanity. It's nuts. So you've got to get rid of. of the $780 payment. And you guys could go down to one car, for that matter. Your wife doesn't work. She's on two kings. I don't think she needs to be driving a lot.

Starting point is 00:46:14 So you got in, and then you're going to have to pick up work doing a lot of other stuff until you can land something that's stable. Any good suggestions, Ken? Well, the reason I went that direction of what have you done or what kind of work is because you're going to have to get back into that space. And what I heard was a lot of limitations. But right now you can't.

Starting point is 00:46:36 can't accept limitations. I understand depression is real. That's a real thing. I get it. But you're going to have to fight through that because you are the person that this entire household is relying on. So yeah, manufacturing, warehouse work. I'm showing up and I'm going to go back to Walmart and I'm going to say, hey, here's what happened to me. I'm going to power through it. I mean, anything and everything right now, two and three jobs, you have got to get enough money that may be seen, not maybe. I'd a therapist. I'd scrape enough money together where you get some help because a professional can help you with some tools to power through the depression. And this is desperation time. Yeah. I'm sorry you're facing all this. So sorry. I'm 100% sure we've got to get your income up

Starting point is 00:47:24 and I'm 100% sure you need to sell your truck. And when you do those two things, you create a sustainable situation mathematically. And that gives you the opportunity to work through the emotional struggles that you got. So keep it up, dude. Keep pushing. Keep fighting. You can do it. Thank you for joining us, America. We're glad you are here. Ken Coleman, Ramsey, personality, number one bestselling author of the book, Paycheck to Purpose and his new work discovering or finding the work you're wired to do, which comes with the get clear assessment to help you figure out what your strengths are and where you need to head with your whole career. and money-making endeavors.

Starting point is 00:48:46 It's a great thing. It's just hit a bunch of bestseller things this week, as a matter of fact. Very cool. Hey, the average interest rate for a 15-year mortgage dropped from 6 to 5.6 this week, and the average this week, I'm sorry, fell to 5.15. The lowest we've seen since February of 23. So almost 20-some-odd months now since we've seen an interest rate that low. So if you purchase a $423,000 house with a 20% down payment on a 15 year,

Starting point is 00:49:20 the interest rate change is the difference now of about $3,000, $4,000 a year, is what it would save you. So, yeah, if you're financially ready, if you're out of debt, you have your down payment ready, and you have your emergency fund in place. We're huge on the real estate market, and this is the time to do it. It's also a great time to sell because there's a shortage of inventory. So it's kind of a weird market in that way, but you need a good, strong real estate agent in your corner that knows what the flip they're doing. High protein, high octane.

Starting point is 00:49:52 So go to Ramsey Solutions.com slash agent, and you can find the real estate agent that's Ramsey trusted that we have vetted in your area. So there we go. Open phones at AAA-825-2-225. Nicole is in Jacksonville. Hi, Nicole. How are you? Good, how are you? Better than I deserve.

Starting point is 00:50:15 What's up? Okay, so me and my husband are about to bring a baby into the world in January next year. Congratulations. Thank you. He's had this credit card with his mom that he's been having for, like, the past basically a year and a half. But she basically has, like, joint ownership of his, like, account and stuff like that because he's in the military. So, like, when he first got in, he was like, oh, well, you're going to oversee everything.

Starting point is 00:50:49 Just make sure, like, my bills are paid and stuff like that. But she opened up her credit card, and she's run of, like, $14,000 since then. And every time I try to talk to him about it, like, hey, like, what's going on with this? Like, you know, is she going to take care of it? Now that we're bringing a baby into the world, I'm concerned. and then like every time she'll ask him about it, like she completely like it's angry or upset and cries because she has lupus and she has like a lot of medical bills too.

Starting point is 00:51:19 So we're not really sure how to ask. How long have you been married? We've been married for a year and a half. Mm-hmm. Okay. And what does he make? What does he make and what do you make? Um, he makes like 55,000 a year.

Starting point is 00:51:39 and me, I'm a student, so I'm still in school and everything, because I work part-time. How old are you, too? I'm 22, and he's 23. Okay. Here's the thing. Here's the thing. Stop. You don't have a mother-in-law problem.

Starting point is 00:51:57 You have a husband problem. Okay. So hubby has got to decide now that there's a new woman in his life that's not his mother. in the old days people would say things like when you get married you leave your parents and cleave to your spouse leave and cleave we called it okay and there's a boundary drawn there's a new household has been established a year and a half ago and now it has a baby entering it okay and we're not going to blame any of this on the baby we're going to blame all of this on your husband the day you all got married it was his job as a man

Starting point is 00:52:40 man to separate all of his accounts from his mother. This is very boyish, not manly behavior. Yes. That he's engaging in. And so if I'm in your shoes, I'm going to sit down very calmly. And I don't care if his mom cries, I'm sorry. And I don't care. I'm sorry she has lupus.

Starting point is 00:53:08 But the reason she's crying is because she's ashamed. and because it works on her little boy. So we're going to have to help your husband run down to Walmart and pick up a backbone. They're on aisle three. And then he's going to walk in there very calmly and gently and say, Mom, now that I'm married and I have my own family, we're not going to have any more joint accounts.

Starting point is 00:53:32 So everything is being closed today. And you're going to reopen your own accounts, Mom. And you need to pay this $14,000. you ran up on this credit card. Okay? And if she doesn't, you'll have to, because it's got your husband's name on it. This is a mistake that he has made. And it may cost him and you $14,000 because I got a feeling this woman's not going to pay this, don't you?

Starting point is 00:54:04 Yeah. And you're not to be involved at all. You'll become the wicked, you'll become the wicked daughter-in-law. it'll be all your fault because this woman is a travel agent for guilt trips okay yeah every time i like try to like to help her about no nope no no no don't you ever say a word to her about this again but your husband he needs to throw his shoulders back and become a man today today this is weak and fearful behavior he needs to become courageous bold gentle with his mom there's no reason to be mean to her. He's the one entered into this arrangement, but it does need to be very

Starting point is 00:54:49 thorough and complete immediately. It's absurd that a man that is married and has a baby on the way has joint accounts with his mommy. That's ridiculous. You can play this back for him if you want. He needs to square his shoulders. Yeah, he needs to square his shoulders. And what in there. I don't want him to be unkind to his mom, but it was his duty the week before you got married to separate everything. When my kids were getting married, we sat down two weeks before. I transferred every single mutual fund that was theirs, every single checking account or a piece of savings that was theirs completely out of our name. And if they went and did something stupid with it the next day, that's on them. Because they're now what's known as grown up adult.

Starting point is 00:55:44 And so it's not my job anymore to manage them. They are now free agents. They're grown people. And you don't even have to get married to do that, but that happened to be when we made sure that everything was final because I did not want to be interfering with my in-law, my daughter's in-law, sons-in-law, just like Nicole situation. This is happening more and more.

Starting point is 00:56:08 Yeah, the emotional umbilical cord needs to be cut. And this is the reason why is because the lupus, she's my mom, she did this, she's done that. And you cannot think rationally when you were thinking emotionally. You cannot have a rational thought at the same time that you have an emotional thought. And this tied together, he's never going to act rational until the clear cut has happened. And I really would recommend that he watch this so that he realizes you're not the bad person. And you don't be pissed as somebody be pissed at me. It's like a spiritual gift I have.

Starting point is 00:56:43 I'm fine with that. Yeah. Cut the cord, man. There's entire Reddit pages devoted to doing that. So you can and comment sections of everything. By the way, this is only going to get worse. I want the young man here. Every day this goes on.

Starting point is 00:56:55 Every day this goes on. And we're not even going to blame this on the baby. Oh, no. Not the baby. This is something should have been done before there was a baby. Well, I'll tell you, it's the big baby. I'm blaming it all the big babies. Not the baby in the womb.

Starting point is 00:57:06 The baby who has yet to mature. Yeah. And by the way, mom enabled this. So there's enough blame to go around. No, no, she didn't enable it. She manipulated it. She wanted it. She likes this. He was a mama's boy to go to the military and say,

Starting point is 00:57:19 Mom, pay my bills. Yep, yep. I'm not blaming that all on him. Yep. We've got to let these kids fly, folks. Kick them out of the nest. That's what the birds do. Mm-hmm.

Starting point is 00:57:29 Yeah. That's, um... This is a national problem, to your point. It's a real problem. It's a real problem. This is The Ramsey Show. Ken Coleman, Ramsey person. is my co-host today.

Starting point is 00:58:26 Thank you for joining us, America. Danelle is with us in Salt Lake City. Hi, Danelle, how are you? I'm good, thank you. How are you? Better than I deserve. What's up? I have a little dilemma that we're trying to figure out what we need to do. I have a 2012 Hyundai Launtra, and it's got over 200,000 miles on it. In around the end of October, I was backing up out of a parking spot, and a guy

Starting point is 00:58:53 behind me back into my car. And it didn't ruin my car so I couldn't drive it, but his insurance totaled my car. Great. So now, yeah. I mean, you're driving a hoopty and you're getting a check. Yeah. Yeah, I can get a check for it. Yeah.

Starting point is 00:59:15 I can get 3745 and keep it, and I'll have to get a salvage tile. No. You don't want it. 4538. No. You take the full pay, give them the car, go get your car. Okay. If the car was in good shape, if the car was in good shape, and it's 200,000 mile, 2012 Alontera, what's it actually worth?

Starting point is 00:59:34 Have you looked it up? Yeah, it's probably under five. Well, that's what they're giving you is under five. Yeah, yeah. I want you to make sure that what they're giving you is the actual value of the car. Well, the 45 is what they would give me, and that's what I've looked at. No, honey, they're going to give you. the value of the car. That's the law.

Starting point is 00:59:56 Okay. They may not have understood that yet. You may have to help them with that. Yeah. But they're supposed to give you the value of the car. They got, they got tore your car up. So, um, didn't take much to total this car, but it's okay. Cool. I'm glad. So I want you guys, uh, you said we. Are you married? Uh-huh. Okay. You guys jump on the computer before you accept the offer and find out from Kelly Bluebook what the, what the, uh, retail value. of that car is and enter it with 200,000 miles, no damage, and, you know, the attributes of that car, the accessories it has and so forth, and then look on stuff like trader.com and find some that are for sale that look similar in mileage. And if you find out that car is worth 5,200,

Starting point is 01:00:45 you call this insurance company up and say, you need to pay me 5200. And here's the appraisal from Kelly Bluebook, and here's three cars on trader.com that look the same. And all these things say 5,200, not 4,500. And the guy will go, okay. All right. Who's the insurance company? Bear River, mutual. What?

Starting point is 01:01:12 Say it again? Say it again. Bear River. Bear River. That's the actual insurance company, not they wrote the policy. Do what? Bear River Mutual. Okay, I just don't know that one.

Starting point is 01:01:25 Okay. All right. Well, because sometimes I know the reputation. Like if it's State Farm, you can pretty much be assured they're trying to screw you. Okay. Yeah. That's like their modus operandi. Okay.

Starting point is 01:01:36 Jake? I've been hit by State Farm people twice and it's been a problem both times, okay? They're just a pain in the butt. And see, it cost them a lot because I just said that. So, but anyway, the, anyway, so yeah, just verify that the actual cost, value of the car. I'm not trying to rip them off. I want them to pay you what you're due. That's all. Yeah. It's an honest transaction. I'm sorry? I mean, with a ding in the car? No, darling, there wasn't a ding in the car before he

Starting point is 01:02:06 hit it. Oh, okay. Before he hit it, what was the car worth? Yeah, okay. Because that's what they owe you. That's the market value of the car. Because you've got to take the cash and go buy that exact car on trader.com from somebody else. That's what you're going to have to pay for it. Yeah. That's what they should give you. They should replace your car. No, you don't keep your car. Okay.

Starting point is 01:02:30 My other question for you then is... This car was almost dead before this guy put a bullet in it. Let it die. Yeah, it's true. It's true. Okay. So I have listened to you for years, and I just get sick to my stomach now thinking about even taking a loan out on a vehicle.

Starting point is 01:02:48 Well, don't. We have money put aside. Pardon? Buy a $5,000 car. Okay. You have $5,000. You were driving a $5,000 car before this happened. So it was doing, it was perfectly good with your life or good enough for now.

Starting point is 01:03:08 How much money do you have set aside? And is that earmarked for something else or was it for a car replacement? It's to go toward the car replacement. How much you got? $7,000. $7,000? That's your car. fund.

Starting point is 01:03:22 Yeah. Okay. Well, then you can buy a $12,000 car. Yeah. Okay. Yeah. All right. My husband wants me to have a car that he knows we can depend on, and he's like,

Starting point is 01:03:34 man, man, man, man, man. Where was this husband before you got hit in the parking lot? He was sitting next to me. I know. I know, but you see what I'm saying. He wasn't whining about you having something that would dependable when you're driving this $5,000 hoopty. You were saving up to get out of the hoopty.

Starting point is 01:03:49 Now you got, you sold the hoopty. You just sold it to an insurance company. Yep, you're right. A lot of $12,000 cars that you can rely on. Oh, excellent vehicles for $12,000. Excellent. A car that'll do anything, it'll do double backflips. You can get great cars for $12,000.

Starting point is 01:04:06 Yes. Okay. The best value in the market is $10,000 to $15,000. It's the best buy in the car market. You get the most bang for your buck. And it's a great, you can get a great vehicle for that. That'll last you for a long time. Yes, yes.

Starting point is 01:04:21 Yes, yes, yes. There's no reason for you to go in debt, hon. It's just it was an event. Thank God nobody was heard. It's a little parking lot ding. And it's just sad that your car, the parking lot ding. I never heard him. I got totaled in the carogne parking lot, but there you go.

Starting point is 01:04:34 So, bump. You're totaled. I mean, I was going to say, that was quite a incident. He must have been on his way to the game with the wings and the chips and salsa. No, it's in a hurry. Something going on. Amber's in Spokane. Amber, welcome to the ranch.

Starting point is 01:04:51 MC show. Thank you. I just have a quick question, actually two-part question. I have an 18-year-old son. He's still in high school. He will be 19 next year graduating, and he is planning on opening his own business doing what? With his landscaping, with his own money. He's not going to, he's very smart of money. He doesn't have any debt. He won't get a credit card. He only uses what he has. but I was trying to explain to him the other day that he can do it with a zero credit score and he and I am also confused a little bit too but I know it's possible

Starting point is 01:05:36 so he doesn't want to take out any loans then he doesn't need a credit score so why do you need a credit score I think he's more worried about if something comes up where he has to borrow money borrow to yeah if he has to get a bigger

Starting point is 01:05:57 machine or well that already is going to come up a hundred percent of the people that buy machines buy too many of them well he has a plan to buy used and cash and if something comes up he'll buy used and cash he does not need a credit score

Starting point is 01:06:12 do not use debt as your back stop in case of emergencies in business because you will live in debt the rest of your life because a hundred percent of there's three rules in business it takes twice as long as you think it costs twice as much as you think and you're not the exception those are the three rules of business the nice thing is is that he understands all three of those rules and he then he doesn't need a credit score okay the other question is i have is how i've been trying to get him to listen to your show or or read your book or

Starting point is 01:06:50 And he's 18. I'll give him not because he's just, he's still in that mentality stage where he's 18. And is there something, I don't want to push too hard so that he doesn't do it all together, but is there, I know you have books and programs and stuff like that, but I've already bought those and he, he wasn't interested in it. Is it something that may come along later on when he's going through? I guess. I mean, the only thing I can tell you is the only good I've ever been able to do with my kids once they turned 18 and beyond was I try my best to not use my dad voice because once I do, they quit listening. I have to use my persuasive uncle voice like I'm their uncle that loves them and has no power because I am that person that has no power once they're 18. So you've been using your mom voice, you need to listen to Dave.

Starting point is 01:07:46 That won't work. He won't, he turned that off immediately. use your friend voice and maybe maybe he'll pick it up probably not but maybe he will this is the ramsie show hey guys we could use your help it helps us a bunch and we know you're doing it because we're seeing the numbers are incredible if you subscribe to the show on the platform that you're doing or follow the show on the platform that you're listening or watching whether it's youtube or Spotify or uh you know apple podcast put google play whatever it is just click follow or subscribe it makes a big difference also share the show some of these things have a

Starting point is 01:08:49 share button where you can share it maybe you're just listening on talk radio tell people where you're listening you know i'm in phoenix i listen on kta r you know and and the ramsay shows on there it's changed my life tell people tell people when you read a good book tell people when you see a good movie um tell people when you hear a good show a good podcast a good youtube show whatever it is spread the word and we know you're doing it because the our numbers are up astronomically, and we appreciate it. But when you do all that, it also affects all of those platforms algorithms, and the way people are behaving on their effects whether they push the show out

Starting point is 01:09:24 forward in front of people that don't even know they're searching for it. And so it changes everything when you do that, guys. It's a big deal. Thank you very, very much. Even the five-star reviews, those help a bunch, too. Thank you. William is with us in Providence, Rhode Island. Hi, William.

Starting point is 01:09:41 How are you? Hey guys, I'm great. Thanks for taking my call. I appreciate it. Sure. How can we help? So I'm in the military, and I just got married two months ago. Congratulations.

Starting point is 01:09:53 I was about four months ago. Thanks, man. I appreciate it. I discovered you guys four months ago. Life has been excellent. So we're in the process of moving, and we're paying off my wife's student loan debt. It's about $28,000. And we figure out we're going to be moving to Hawaii in March.

Starting point is 01:10:11 looking at housing prices over there, it's going to be pretty insane, at least to do like first month's rent, security deposit, everything like that. So I'm looking at your advice on how to approach that, taking a pause at Baby Step 2, and how to move forward there. It's not really a pause on Baby Step 2, it's just a pause on the whole thing because you've got a, you know, something staring, you're staring, you know, you're staring at this thing in front of you and you've got to deal with it, right? And so, you know, what I would do is put a detailed number on the March move,

Starting point is 01:10:47 stop everything, and pile up that number because it's coming. It's not if, it's just, it's not, there's no question about the probability of it. And so, and then when you've got that number, then push play, set that number to the side, push play, and then start working it again. Okay. Yeah, that's exactly how you do it. So which branch are you in? I'm in the Navy

Starting point is 01:11:11 Okay Yeah Well, thank you for your service Sir We appreciate you guys And how old are you two? 28 My wife is 26

Starting point is 01:11:21 Perfect Yeah Okay Have you been through Financial Peace University yet No sir We've been Just kind of listening to the show

Starting point is 01:11:30 And making a go at it Okay We're going to give that to you As a belated wedding gift Two months into my wedding I wish Two months into my marriage I wish somebody has shown me this stuff.

Starting point is 01:11:41 My life would have been completely different in a good way. So, yeah, and I got a pretty good life. But yeah. So anyway, hang on. Christian's going to pick up. We'll get you signed up for Financial Peace University because Hawaii is expensive. Yeah, you need to. And that's the truth.

Starting point is 01:11:57 Dave, I've got to ask a quick question because this is, I'm curious to know your take on this. If I was in this situation, and he's in the military, so he may not be able to do anything outside of his military service. But if his wife is not working outside of the home or even if she is, I'm the kind of guy that if I were in that position in the baby steps, certainly in Baby Step 2, and I had an expense like that that was coming, and we knew it was going to be a chunk. So let's just say it was, I'll make this up for example of purpose. I had to come up with $5,000 for something in March. I'm the kind of guy that's going to go crazy trying to make extra money and fund that

Starting point is 01:12:29 $5,000 above and beyond what I'm doing out of my normal budget towards the baby steps. Do you, do you, does that bother you? That's an okay thing. The thing is, it works exactly the same way if you just push stop. That's true. And then go crazy. Right. And pile it up that much faster.

Starting point is 01:12:48 But I'm the guy who hates losing the progress. Put, put, you know, but if you pile it up twice as fast. Right. Because you're not staying in play mode. You push pause. Then you, boom, you're back at it. And mathematically you'll end up in about the same place. And, um, but you're right.

Starting point is 01:13:06 It does light a fire under you to get it done quick. Jack is in Los Angeles. Hey, Jack, how are you? I'm good. How are you doing? Better than I deserve. What's up? My fiance and I are both 25 years old.

Starting point is 01:13:20 We're getting married two months from now. And we're, of course, looking to combine finances. Not sure the best way to go about it on a couple fronts. One, should we be waiting until we're married? two, we both do have credit cards. We both, as of last month, are debt-free, but we're wondering, should we be keeping them? Should we get rid of them? We're worried about, you know, canceling them, impacting our credit scores as we looked at

Starting point is 01:13:49 by a house, so hoping to get your advice on all of that. Okay. You don't combine finances until you're married. Okay. And after you're married, then yes, you combine them because the preacher will say, and now you are one. And that's what that means. Until then, you've got all kinds of issues

Starting point is 01:14:07 when you combine things that can happen if something terrible happened before the wedding. You get yourself into a mess. So we just wait until then. As far as keeping your credit cards open, the best thing I know to do is cut them up and close everything and have zero balances. And if you have no active accounts going,

Starting point is 01:14:31 It takes about six months for your credit score to just disappear. What you don't want is a medium credit score. You either want a very high one or a no credit score when you're going for a mortgage. No credit score sets you up for manual underwriting with someone like Churchill Mortgage Hour, the team that we've endorsed for mortgages for almost 30 years now, and they can help you do a manual underwriting with zero credit score. but you don't want, you don't want to be in no man's land in the middle. And that's what will happen if you keep a bunch of stuff open with zero balances.

Starting point is 01:15:08 Because the FICO algorithm is built to where it wants you to be in debt. To drive an 800 credit score, you have to get in debt and stay in debt and pay it regularly. I pay my credit cards off every month or I don't use them at all and they're open. Will damage your credit score. So will closing them will damage your credit. score, but closing them is the path to get to zero. And that's where I would recommend you go is to zero. And it's okay to not buy a house immediately, by the way.

Starting point is 01:15:41 It's going to take about six months for this to happen. So six months from the time you're married, you both close all accounts. You have zero balances, zero activity of any kind on anything that's reporting to FICO. You will disappear. You'll fall off the grid, which is what you're trying to do here. And, you know, that's the goal. and we recommend in general young couples getting married that they wait a year to buy a house. It takes about a year of marriage to know how close to your mother-in-law to buy.

Starting point is 01:16:12 You've got to get to know each other, okay? And, you know, you've been married 20 minutes. You're going to buy a different house then than you will when you've been married 20 months. It's a different property you're going to sign up for. And so, you just, you know, just take your time. You got the rest of your life. You're going to be okay. I don't want you to take 10 years, but you can take a few months.

Starting point is 01:16:35 And during that time, you have the opportunity for the credit score to go away. Yeah, you know, I'm thinking back to when Stacey and I got married and this whole question, and we were walking through premarital counseling. Both of our dads were pastors, and so they were, you know, really driving home the point that you made, keep everything separate, separate, of course. But it was us trying to clean everything up, and Stacey had some debt, and we worked really hard to help her, and she, She went after it and to enter into marriage with, and we had a little debt.

Starting point is 01:17:05 I had a little bit of student loans left, and she had a little bit left, and then we knocked them out in that first couple years. But it was such a big deal for us to, in the first 12 months, just learn how each other handled money. You know what I mean? How you handle life? There's that too. But it's like to make a big purchase decision like that and strap yourself into a mortgage

Starting point is 01:17:26 like that without kind of, as you said, experiencing marriage and the way. we viewed money. That first 12 months for us was really eye-opening. And we had to learn how to get on the same page. Yeah. It was for my wife sharing. She realized she'd made a huge mistake. Well, Stacey as well. Poor woman. They have the patience of Joe. Thought she married Sir Gala had. Turns out it was Goober. Right. I resemble that. This is the Ramsey Show. Welcome back to the Ramsey Show in the Fair Winds Credit Union Studio with Ken Coleman, number one bestselling author and host of of the front row seat.

Starting point is 01:18:46 As my co-host, I'm Dave Ramsey. Ryan is in Nashville. Hey, Ryan, how are you? Good, Dave, how are you doing? Better than I deserve. What's up? Well, I had a question about retirement in 401Ks. I am new into a Roth IRA.

Starting point is 01:19:03 I'll be 50 next year, and I can only contribute so much to that. And on my wife's 401K, we're maxing out what she can do a year on that. And then there's a rollover IRA from previous employment that we have. So we've got the three things working for us, but I can only contribute, you know, just that $7,000 a year. And I would just like to do what you think other ways for me to try to make my money work for me down the road so I can have more retirement. Yeah, you can bump it to $8,000 at $50, and you can also do a spousal Roth for your wife as well.

Starting point is 01:19:40 Are you doing both of those? So we can do that if she has a 401K plus she has a roll over IRA? Yes. What's that called? I'm sorry? Just a Roth IRA. She can just do a Roth. She can do one too.

Starting point is 01:19:53 She can do a Roth. Yep. Even if she's not working, she could do one, but she's working in this case. So make sure, is her 401K a Roth? No, I don't believe. Well, yes, it is. It is. Okay.

Starting point is 01:20:05 All right. Because if they match, the portion they match is not Roth, but make sure it's not traditional is the roll over raw is a roe has it been converted to roth i don't think it's been converted it's just a rollover okay if you convert it it'll make the taxes on the amount come do what's the amount in there the amount on the rollover currently is probably about 75 okay so you would have about 15 or 20 000 in taxes probably 15 um if you get it so if you got an extra 15 to invest in retirement i would roll that to a roth and pay that 15 in taxes and call that investing.

Starting point is 01:20:42 Here's why. Because from this point forward, it will grow completely tax-free. Okay. So that paying those taxes now is like investing into a retirement. So if you're looking for more money to throw it something, the first thing is you bump them to eight, you do a spousal. A spouse will make sure her 401k is Roth, if it's not already,

Starting point is 01:21:03 and then take that rollover and, you know, talk to your tax person, figure out what your taxes are going to be before you do it. Make sure you've got that much in extra cash. to pay your tax bill next year when the April rolls around because you're going to have an extra whatever it is, 15 grand or so, on that, and then roll that 75 because that 75 in 7 years will be 150 and in 7 more years will be 300 and then 7 more years will be 600 and all of that will be tax free if it's Roth. It won't be the way it is now.

Starting point is 01:21:35 It's going to grow and all of it be taxable at ordinary income. So you do want to move that at some point. But if you're looking for extra ways to put money towards retirement, that's the ways you can do it. Matt's in Tennessee. Hey, Matt, how are you? I'm doing great, guys. I'm so excited to be on the show. Thanks for taking my call.

Starting point is 01:21:54 My pleasure. How can we help? Well, my wife and I have been weighing the decision of making her a stay-at-home mom, and I just want to make sure we're not letting a motion blind us from making a, a bad decision financially. Cool. Good for you. How many babies you got?

Starting point is 01:22:18 We have two. They're both under three. Awesome. You got your hands full. Never a quiet moment at your house. Yes. Okay. So, yeah, that's great.

Starting point is 01:22:29 I just kept the grandbabies last week that Sharon and I did that are that age and I know what I'm talking about for just a moment there. But I can hand them back when they're broke. You can't. So this one's got something wrong with you. You don't need to work on this one, yeah. But anyway, what does she make? She makes 95 gross.

Starting point is 01:22:49 And what do you make? I make, I'll be on track to make over 150. Okay, cool. If you want to be really, really sure, an easy way to do it would be just live on your check for three months and bankers. Yes, sir. We've been doing that. Oh, you have?

Starting point is 01:23:10 Okay. I mean, minus daycare. If you got daycare, you could take daycare out of hers, but because you won't have that. Yes. But if you just practice, so you've already proven to yourself, you can do this. I guess so, but, I mean, I guess we're just a little nervous to take that leap of faith. It's not a leap of faith. You've proven it. It's a step. It's a step. It's not a leap. Yes, sir. How much margin do you? A leap is I have no idea, and I've never even looked at the math.

Starting point is 01:23:41 that's a leap. This is true. Yeah, so you're done great, man. So what does she do for a living? She's a nurse auditor for Jimena. Is she a nurse by trade? Yes, sir. Okay.

Starting point is 01:23:58 I think Ken and I would both recommend that she do enough of something to keep her search alive while she's at home. Yeah. We've both talked about that as well. We want to keep her license up to date. Absolutely. Absolutely. Absolutely. And you'll be amazed at what she could pick up as just little side things here or there that make a lot of money. She's got like the perfect career to do what you're talking about doing.

Starting point is 01:24:23 I couldn't agree more. I mean, she could pick up, if y'all got in a pinch or something, she could pick up weekends in the ER and make almost as much she's making now. This is true. Be very uncomfortable, and I'm not recommending doing that. And you don't have to because you've already proven we can live on your income. So, yeah, just do it, man. do it this is what the this is you this is why you manage money to get to live the life you want to live and you guys want her to be home and she's doing nothing wrong and everything right by doing

Starting point is 01:24:52 that yeah my my question is is is as Dave was walking you through this you just you still seemed unsure is that because you're worried about some big giant expense coming out of nowhere from the giant in the sky or you are too tight on just your income no that's a good question We're not too tight on my income. What makes me nervous, Ken, is I started this job in June, and it's a phenomenal job. It provides very well. It's given us a great financial bump.

Starting point is 01:25:30 I guess it just makes me nervous to solely rely on my job, having been in it for such a short period of time. What do you do? I'm in medical sales. Oh, dude. Yeah. You land another one. You can land backwards on your head and make $150 and that and the next job.

Starting point is 01:25:52 If these people lose their minds, you can get another job doing this. Once you've done medical sales, you're so qualified, it's unbelievable. You both have selected excellent careers. You'll be making $250 in three years, dude. Yes, sir. If everything goes well and I stay on plan, I should track to make over $200. Yeah, absolutely. Well, the good thing coming out of a decision like this is you're going to be extra motivated.

Starting point is 01:26:17 And I appreciate you sharing the fear. And I didn't need to know. I wanted you to hear yourself say it. And so what you need to do now is go, okay, if this makes me a little nervous, is there any evidence that it should make me nervous? And in this case, the answer is no. And then to Dave's point, you can crush it, man, so go crush it. And here's the other thing.

Starting point is 01:26:35 You guys can decide, okay, we're going to stack up a little extra money. Oh, just a little rest easy money. No, we're not saying you have to do that, but you can to kind of ease yourself into this. You guys get to decide how and when you make this transition. And everything goes sideways. She walks down there and picks up a nursing job. I mean, if you lost your job, she picks up a nursing job, y'all can eat. It's okay.

Starting point is 01:27:00 It's not like it's permanent. You keep those certs, though. Keep everything up to date. Ken Coleman, Ramsey Personality is my co-host today. He's the number one bestselling author and host of the Ken Coleman Show on the Ramsey Networks. And one of his bestselling books is find the work you're wired to do. It's his latest bestseller. It included in it is the get clear career assessment that we've sold almost 100,000 of,

Starting point is 01:27:54 and it goes with the book for free. So not only do you get the assessment, you get the book to teach you how to read the assessment and what to take away from it. So be sure and pick that up at Ramsey Solutions.com. Jack is in New York. Hi, Jack. Welcome to the Ramsey Show. Well, thank you very much, Dave.

Starting point is 01:28:11 How are you today? Better than I deserve. What's up? Well, I'm at the age now, mid-50s, to where you want to get to be conservative with your investments. However, for retirement. However, I don't have a retirement because of life choices that I've had to make throughout the years. So now that I'm finally in a financial position to where I can start making investment, I'm afraid to make liberal investments to make money to actually have a retirement

Starting point is 01:28:44 because I'm at that age to be conservative, so I really don't know what to do. Well, let me help you with this. You're not at the age to be conservative. I don't know who told you that, but they were wrong. Well, I don't have that many years left to live. You have plenty of time. You're only 50. Okay.

Starting point is 01:29:07 I'm not conservatively investing, and I'm 63. So I'm investing in good growth stock mutual funds that are growing like a weed, and you need to be. You're broke. Well, I'm not broke, but I have no retirement whatsoever. I mean, how much do you have? How much money do you have? I got about 20K in savings. Okay.

Starting point is 01:29:33 Well, you're broke. I mean, for 50 years old going into retirement, that would scare the crap out of me. You need like 250, right? Moving on. And so I'm not trying to scare you. I don't want you to panic, but you do need to get with it, as you said, and you recognize that. That's why you called. So what I would do is this.

Starting point is 01:29:53 The thing I have figured out is there's two things that we are afraid of. And fear is a positive thing in these situations. Number one thing we're afraid of is something we don't understand. So the first time you sat behind the wheel of a car, I distinctly remember I was 12, and dad said move the car around back. I left no gravel in the driveway. No one told me you weren't supposed to press down on the accelerator all the way to the floor. And so I didn't because I didn't know what I was doing. So driving a car, I didn't know how to do it.

Starting point is 01:30:31 I was afraid and I was really afraid after I screwed it up, right? But now we all have been driving cars for decades, and we drive and don't think anything about it. It's like muscle memory. So you learn how to do the thing and you're no longer afraid of it. The second thing you're afraid of is something that will legitimately hurt you, standing in the middle of the interstate. You should be afraid. An 18-wheeler is going to turn you into a bug, right? And so, yeah, that's a fair, you know, a bear is standing in front of you.

Starting point is 01:30:57 You should be afraid. That's a good thing. But the other is just you're afraid because you don't know how. And that's the investing thing. That's wisdom, but it's something that can be overcome. I don't want to overcome my fear of bears. They will eat you. But I do want to overcome my fear of things I don't understand that can help me.

Starting point is 01:31:16 And the fear goes away with knowledge. So sit down with a good smart vester pro, click that at Ramsey Solutions, and let the guys that we recommend begin to teach you and gradually start to understand. And as your confidence builds, then you increase, you'll, easily increase the amount of money you start pouring into retirement-type investments, and you won't have to worry about the whole idea of conservative versus whatever, bull crap, something you read on the Internet, right? Yeah.

Starting point is 01:31:47 I completely understand that. That's absolutely true. Ken? Yeah, I was just going to echo that, that right now you have no idea what you don't know, and that it just paralyzes you. And so I think the quicker you can get seated with, smart vester pros, interview several, figure out the one that you've got the best chemistry with, there's that teacher relationship going on, and you can make up some ground pretty quick,

Starting point is 01:32:14 but you've got to be aggressive. And I would say, Dave, beyond just the mindset of aggressive, I'd be doing some things if I were him to make some extra money and try to catch up. Where can I make an additional 10 grand, an additional 15 to 25, so you can play catch-up and start stacking some money. When you begin to see that momentum, by the way, that gets really, really exciting. and you start doing more of that. A lot of people think that they've got to have a side hustle just to pay off debt or just pay the bills. In this case, when someone is that age, to the extent that you can do some extra work and leverage your skill and experience to pour more money on top of the little fire,

Starting point is 01:32:52 the bigger that fire gets. That would be a direct challenge in this situation for him. That's very good. And that reminds me, you know, when they're walking around out there in the world, people say these sayings that are just stupid. Right. You know, here's one of them.

Starting point is 01:33:07 What you don't know won't hurt you. What you don't know will kill you. That's a dumb but saying. You know, lack of knowledge, knock you out, man. I mean, that's a ridiculous, you know,

Starting point is 01:33:22 like you can just stick your head in the sand. And I'm not talking about Jack here. I'm just saying in general. But, uh, yeah, it's a big deal to know new things all the time. Angela's with us in Knoxville.

Starting point is 01:33:32 Hi, Angela. How are you? Hey, Dave. I'm doing all right. How are you? Better than I deserve. What's up? Awesome.

Starting point is 01:33:40 So today is actually my birthday. Happy birthday. Thank you. How old are you? I was like in a tip of 42. Oh, okay. Just a pup. Yeah.

Starting point is 01:33:52 Yeah. So I actually met you in Orlando a couple years ago, in fact, at one of your events. So I'm trying to get back on track, Dave. I never did the baby steps. I purchased SPU at that event, never did anything with it like a dummy. And so basically I'm in $30,000 of debt. About 18 of that is my car and another seven in credit card debt, and I owe five to a family member.

Starting point is 01:34:22 And so my question is I'm trying to figure out the best way to go about once I get to Baby Step 2 because I'm going to be finishing baby step one next month. And then in August, I'm going to start tackling the debt. My car has about 250,000 miles. And I use my car right now to make a living. And so my concern is if I start tackling the smaller debts first, and then my car breaks down and the transmission goes out or something, and I can't fix it. And I, you know, I don't know if I should be saving more in my step one for that, or that's kind of where I'm stuck, and I just wanted your input. You owe $18,000 on it?

Starting point is 01:35:04 Yeah, I had a paid for forerunner a few years ago, and then I started a new job. You owe $18,000 on a car you have $250,000 miles on? Yeah, because I was a courier. I ran the miles up on that thing. I was a courier for the last two, three years since I bought the car. I just racked it up. Okay. What kind of car is it?

Starting point is 01:35:27 It's a 19-dodge charger. Okay. A six-cylinders, a cheaper one. Yeah, okay. Okay. No, I mean, we're worrying about something that hasn't happened yet. It's a reasonable thing to worry about because those things may occur, but I'm not going to change the game plan here.

Starting point is 01:35:47 I'm going to, you know, if you have a problem, you may have to stop your baby steps and address the problem. But until you do, you were already broke before you start. started this and now you're just running broke trying to actually do some good and climb out, right? Yeah. I mean, so, yeah, cut up your credit cards and let's start attacking them with a vengeance and work as many hours as you can.

Starting point is 01:36:09 And as Ken says, always, you know, get an extra job. Let's do six things and do that written budget in detail and live on nothing and work all the time. And let's begin to get this cleaned up because this is a scary place to be for you. It definitely is. I moved to Knoxville from Florida back just this last December, and I had a pretty decent job. It didn't pay too great, but it was all right.

Starting point is 01:36:34 It was my first job since I moved here. It got laid off, like, after three months. They just didn't need me anymore. And so I've been door-dashing, like, 72 hours a week ever since. And I have another job that I started, but they're just trickling me in with work. I'm not full-time with it yet. once I do that should be about 72 a year that'd be huge that changes everything yeah yeah I'd love

Starting point is 01:37:01 to see her really hustle through this quickly because that car is going to be a problem pretty soon yeah yeah and it's but I don't want to stop doing no no no in lieu if something hadn't happened I'd let that be that extra motivator yeah exactly this is the ramsie show Real estate is weird right now. It's weird out there. I mean, it's strange. If you're going to buy a house right now, if you're going to sell a house right now, you don't really need to be screwing around with this unless you're dealing with somebody

Starting point is 01:37:41 really knows what they're doing. Because it's a strange time, and you need someone to help you navigate that. If you're a buyer, that way you don't get ripped off and you don't get pushed into some kind of weird thing. Or if you're a seller, you get the proper amount for the property and the right kind of marketing advice from a pro who's actually done it before. not your uncle Henry who got his license three weeks ago and demands that you list your largest asset with him that's dumb don't do that no no we're going to get like somebody that sells

Starting point is 01:38:10 30 to 300 houses a year that's somebody who actually stays in the business when things are good and when things are bad they know the market they know how to navigate weirdness and they can help you we vet all of the agents that we put in the ramsie trusted program we coach them they're lined up with what we teach here. They understand what you're listening to this show that you're going to be calling with that mindset, and they really are high-octane, high-protein, get-or-done people with proven track records.

Starting point is 01:38:40 To find a Ramsey trusted real estate agent for free, just go to ramsysolutions.com slash agent. Amit is with us in Greensboro, North Carolina. Hi, Amit. How are you? I'm great. How are you guys? Better than we deserve.

Starting point is 01:38:56 What's up? So I Long story here But I was My background and technical background Is engineering and science I did that for a few years I went to school for it and everything

Starting point is 01:39:08 But love basketball Ended up switching careers And I ended up coaching basketball First at the collegiate level Division 1 And then into the NBA for the last two years The NBA is moving more and more towards hiring players Even with 10 years experience

Starting point is 01:39:22 In coaching at those levels I'm having a hard time finding jobs that are paying me enough to get by. I'm married. I don't have any kids, but my wife makes exponentially more money than me. So financially, we're okay. We have no debt, nothing. Homes paid off, cars are paid off, so we're good there. But I'm thinking now of transitioning into a different career, I have no idea what to do.

Starting point is 01:39:45 And I've been so out of touch with what my degrees are in, that I don't know if I could go back or if anybody would take it, you know, bring me back there, if that makes sense. It does make sense, but I want you know that that's your fear and doubt that's clouding your judgment. And just somebody who's completely objective, a former Division I basketball coach, a former NBA coach is a highly attractive bio and resume, especially if you have some skill set that will apply to what you're going for. I'm just interested. What's your favorite part of coaching? To me, it's about the relationships and the people I interact with every single day, whether it's players or other coaches or exist. executives,

Starting point is 01:40:25 administrators, whatever it may be. It's a very people-in-lationship-driven business, and that to me is why I got into it in the first place. I know the salaries are crazy right now, especially in the NBA, but I never was about it for the money. I was in it for experience,

Starting point is 01:40:39 opportunity, and just because it felt so satisfying, and it still feels satisfying, and I want to keep doing it as long as I can. Did you play college basketball at any level? Did not. You did not. That's the crazy part.

Starting point is 01:40:52 No, it's not. I'm 5-10. I'm in. Indian and there are not a lot of people that look like me that do this. Right. Okay, you actually led me right into my question and you're making my case for me. You aren't in that position because of your X and O's knowledge and being a guru, a guy who put up 25 points a game. You're not in that role and you haven't gotten into that role based on that. Is that true or false? My success is all from work and relationships.

Starting point is 01:41:25 That's it. I don't have the 15-year NBA career that some of these guys have. Exactly. And you have managed to get to the highest level of a sport. The NBA as a 5-foot-10 Indian. I mean, you really are an absolute freak in a good way. Okay. And it's all based on your skill set of connecting with others.

Starting point is 01:41:45 Can I just tell you something, and Dave can chime in here. He's a guy that is the founder and active CEO of a company of over a thousand people, and he hosts one of the largest, most influential leadership podcast in the world. We talk about leadership all the time. America needs leaders. I'm paying attention to this stuff every day, and companies need people who can lead people, who know how to connect with people, who know how to communicate with people, who know how to instruct people, who know how to instruct people,

Starting point is 01:42:15 who know how to encourage people, A meet. You got an incredible resume. Oh, and an engineering degree. So if I'm you, I'm going, I'm going to start with, let me take that degree of engineering, and I'm going to look at the engineering field. I'm not going to limit myself to engineering, but I'm going to start there because I got the degree.

Starting point is 01:42:33 And then I'm going to start working my connections. By the way, I'm going to give you my book, The Proximity Principle, which for a guy like you, who's a learner, it's going to give you the absolute formula, the five people you need to be around, that will help you get where you want to go. And by the way, you have an unbelievable network. And so all those coaches who know business guys, your college connections,

Starting point is 01:42:54 with all these business guys who used to donate money, big time, they were hanging around those D1 programs. Those are your connections. And you go, look, I got an engineering degree. I can get in the engineering field and lead people today. I may not be the most talented engineer, which, by the way, am I, tell me if I'm right or wrong, the guys and gals that are leading teams of engineers are rarely the most talented engineer.

Starting point is 01:43:17 True or false? I wouldn't know. I've been removed from it for so long that I don't remember. All right, I'll tell you the answer. The answer is leading engineers, you don't have to be the smartest, Dave, the most talented engineer. You just got to know how to lead people. And this guy, he's bona fide. That's my take.

Starting point is 01:43:33 And he's going for management and leadership positions across the spectrum of the business world. I think you can go just about anywhere. Because it's not about the trade and it's not about the industry. It's about his ability to come in and bring a team together. That's my two cents on that one. Exactly right. What we teach when we're teaching entree leadership to business people is what happens a lot of times of small businesses, people become accidental entrepreneurs.

Starting point is 01:43:59 I'm really good at heating and air, and I get me a truck, and then I look up, and I got 40 people and 10 trucks running around. Now I'm no longer. now I'm no longer a heating and air technician, now I'm a leader. That's right. And leading and running a business is a different skill set than fixing your air conditioner. And leading and running a people is a different skill set than playing basketball or being an engineer. The leadership skill set you excel in.

Starting point is 01:44:28 That's right. And so you do have a great resume in that sense. Now the trick is, where do you want to plug it in? What type of a business? What kind of dynamic environment do you want to be? in where you're leading and then finding people through your connections with proximity principle to plug into one of those locations. It'd just be amazing. Yeah. I mean, he can absolutely make this transition and do very, very well. Because what he has going for him that a lot of

Starting point is 01:44:57 NBA coaches don't have if they leave that industry is he's got a really good degree. That engineering degree is very helpful, meaning he's got that skill set. He's got the mindset to think like an engineer. you add the leadership to it, unbelievable. Absolutely. That's exactly how it works. So hang on. We'll have Christian pick up, and we will get you signed up for that. Send out that book to you, I mean.

Starting point is 01:45:21 So can the proximity principle give us the thesis of that? It just simply means this. If I am around the people and in the places of the space that I want to be in, then opportunities come my world. way. And so the formula is this. The right people plus the right places always will equal opportunity. I got to get around the right people. And then I get in the right places. And when I'm in the right places, I meet more of the right people. And then they point me to the right places. And it is this knowledge and connection combination that just keeps moving, moving, moving, moving, and moving. And if you

Starting point is 01:45:59 stay with it long enough, opportunities show up on your doorstep. This idea of kicking the door down is Hollywood bravado. It makes for great fantasy. But in the real world, connections come at the most unexpected times because we keep showing up in the right place or we keep showing up around the right people. And all of a sudden, I'm top of mind or I've got the experience and I was showing up and then boom, I'm ready to step into it. She's speaking of basketball.

Starting point is 01:46:27 John Wooden, arguably one of the greatest coaches all time. Certainly basketball. It's my favorite quote, Dave. He said, when opportunity comes, it's too late to prepare. and the proximity principle gets me in a place when the opportunity shows up, I'm ready to step right into it because I kept putting myself around the right people and in the right places. This is the Ramsey Show. Our scripture of the day, Proverbs 3, 6, in all your ways, acknowledge him, and he shall direct your paths.

Starting point is 01:47:45 Thomas Sowell says, some of the biggest cases of mistaken identity are among intellectuals who have trouble remembering that they are not God. Classic Classic passive aggressive Just mic drop There by Thomas Sol Boom There he goes

Starting point is 01:48:01 David is in Chicago Hi David Welcome to the Ramsey show Oh thank you very much Thanks for having me Sure How can I hope My question is that

Starting point is 01:48:11 I'm trying to do the baby steps I got myself A little bit of a quag bar with my debt Mostly Real estate investment But nothing horrible So I'm trying to imply The baby steps

Starting point is 01:48:23 and I'd like to sell one of my rentals, but I just don't think my tenant is going to be able to relocate and or somewhat of a moral quandary. Anything. Why can't your tenant relocate? I just don't think that she'll be able to get another home, especially one as nice and large as this one, to house her and the kids.

Starting point is 01:48:51 So you're not charging her market rent? Yeah, it's close. I mean, I could probably charge her more. So if she's getting close to market rent, why can she not take close to market rent and go rent something else? I don't think she, I just don't think that it's really available. I think it's really going to put her in her position. Why is it not available?

Starting point is 01:49:13 You think you have the only house? No, no, I don't. I don't, but I think she's paying for her mom's rent, too, and I've tried to counsel her to, like, maybe they could, live together, but I don't think that's a... I don't think it's available. She's been late and behind, you know, you know how it is, as Reynolds. And I just, like I said...

Starting point is 01:49:33 Well, let me ask a question. I'm curious, did you feel this way? Did you have this concern for her before you talk to her about the possibility that you were going to do this? No, yeah. Yeah, I did. Okay. And what was her real?

Starting point is 01:49:51 reaction when you told her that this was a possibility? I broke it to her a little bit, but not. I really haven't come down. You didn't answer my question. What was her reaction? I didn't really say it. I didn't really say anything about selling it. It really hasn't come up yet.

Starting point is 01:50:06 Oh. I know it's not going to go over well because I don't think she's going to find. Well, but there's a lot of thinking. You keep using the word think. Listen, it is not your job to manage her house. That's right. You're her landlord, not her boss. You're not her daddy.

Starting point is 01:50:21 And so you're paying almost market rent so she can pay this, take the almost market rent and go rent something else. And if she wants to combine households with her mom, that's completely her business and her problem. It is not your job to manage her life. Yeah, you're right. And you're not doing anything wrong to take an asset of yours and say, you know, I don't want to be mean or nasty about it. And if you want to give a little bit more notice, there's nothing on fire here. You know, we're going to, instead of giving you, I don't know, she on month to month? She is now.

Starting point is 01:51:01 She didn't want to resign last summer. Oh, she didn't want to resign last summer. No. Hmm. Yeah. Hmm. I get a fair amount of runners like that that don't want to resign. Yeah.

Starting point is 01:51:16 Well, they're not committed to you. You don't have to commit to them. The point is you're not a bad guy. I think if you said, okay, I'm legally bound by the lack of a lease to give you one month's notice. I'm going to give you three months. That's a good compromise. And that gives you plenty of time to work your way through this. I've appreciated you being our tenant, except for those times that you didn't pay on time.

Starting point is 01:51:41 And you don't have to say that. But you know, you're acting like this is some kind of freaking stellar tenant. They don't pay market rent and they don't pay on time. So I missed where I'm excited about this tenant. So, you know, I, and that's not being mean. It's just like you got really one job when you're a tenant. Two, don't tear up the house and pay the rent on time. These are the two jobs you got.

Starting point is 01:52:06 So it's your job to make sure you're charged market rent. So, no, you don't have a moral dilemma at all. You can be kind and you could give more than adequate notice. and say, you know, I'm sorry, gosh, if there's any way I can help you with this, I'll try to help you. But if helping you means you staying in the house past this 90-day mark, that's not the type of help I'm talking about. So, but if there's, you know, if we can assist you in any way, I tell you about my friends

Starting point is 01:52:37 that have properties, help you find, you know, something like that. I appreciate that this, but that's what we're going to, we're going to give you three months. Notice, listen, she can process this in three months. And if she's angry at her landlord who she refused to sign a lease with for giving her three months notice, who's only required to give her one month notice, that's her fault, not yours. That's her fault. And so I think this is all about David. He's such a nice guy that he's worried about a confrontational situation.

Starting point is 01:53:11 And I understand that. But this is nothing more than a difficult conversation, and it's not his bag. And I get it. but she's going to be fine just by virtue of only she don't want to sign a deal anyway she's got options she knows it could change in any time David you're a really good dude and you're just fretting over a difficult conversation and it's going to be over in about yeah 45 50 seconds I mean there's not a lot to it yeah it's um hey going to be saw in the house I'm going to be sending you a note in the mail so we make it formal that um you know July 1st we're going to be done

Starting point is 01:53:43 August 1st, whatever it is. And I'm giving you plenty of time. You have 30, you have a 30 day right. But I'm going to give you 90 days just because you've been here a while and I want to be kind. And thanks. That's it. I'm done. It's really it.

Starting point is 01:53:58 It's really don't have to have a big long thing here. It's not a whole bunch of feelings. It's, it's, um, I've had, I've had landlords in my life and none of them had any feelings for me. You know, that's right. I just none of them did. I just, I never had one that did that. And, I mean, if you,

Starting point is 01:54:13 get a situation like we had one one time that uh you know guy got a terminal cancer diagnosis oh you know and he's got four months to live and he lost his job because he lost his health and his wife had three little kids at home and all this and so you know we just didn't charge them rent we let him live there and let her live there after he passed for a little while me we worked we worked with them but but that can't go on for eight years either no even that you know it's a is a period of time we can have some grace and mercy with somebody in that situation but just simply they're going to have to move. That's, you know, this lady, she really just got to move.

Starting point is 01:54:50 I mean, that's part. That's why, folks, that's why you want to be an owner when you can be. And not in a stupid way. Don't go buy something you can't afford because I'm afraid my landlord's going to do that. Oh, by the way, if you don't have to move, sign a lease. Hello. Then you, you know, if he had a one-year contract, then he'd have to honor that morally, ethically, legally, everything at that point.

Starting point is 01:55:12 So there's the process. And, you know, here's the other thing. Those of you that are thinking of owning real estate, you need to have a policy of raising the rent every single year. Because I've been doing real estate for about 40 years and rents have gone up every single year. And the people that I know that get stuck in situations, like this. They don't raise the rent for five years because it's a nice person and they pay on time and they cut the grass real in a little pattern. And then we just love them. And you don't raise the rent for five years. And suddenly you've got a way below market situation. And then you try to

Starting point is 01:55:58 raise the rent and they have a fit like they think they're the owner. So it's really good. It just keeps the relationship accurately defined when we raise the rent, even if it's a little bit. What's the Dave Ramsey way on that? Do you look at the market and then? And we look at the market and we go, if they've been with us a long time, it's a little undermarket. Okay. But not, I mean, I don't take it all the way, the max plus some. I've been there one year. We just take it up to market.

Starting point is 01:56:23 If they've been there five years, we tell them when they come in, too. Right. Next year, rents are going to be higher and just expect. Go ahead and know. You know, and that way they're not shocked. Like, what? You know, what? Right.

Starting point is 01:56:35 I don't understand. I mean, what do you mean what? Rents are going up. And so if you don't have that, uh, You set these, you set an entitlement expectation in place, and it creates real serious problems later. It's a real bad idea. That puts us out of The Ramsey Show in the books. We'll be back with you before you know it.

Starting point is 01:56:55 In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

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