The Ramsey Show - App - You Don't Teach Kids to Drive by Putting Them in a Wreck (Hour 2)

Episode Date: May 26, 2020

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thank you for joining us, America. My co-host this hour and today on the Dave Ramsey Show, Ramsey personality Anthony O'Neill. And, of course, he is the number one best-selling author of the book Debt-Free Degree and a new Ramsey Quick Read, which is a 64-page quick book to read that is called Destroying Your Student Loan Debt. So if you didn't go, if you didn't read his first book and go to college debt-free,

then you need the other book because you've got student loan debt, and it's called Destroying Your Student Loan Debt. Now, that is for somebody that has probably never read some of our other books which talk about the debt snowball and how to get out of debt. There's some special stuff in there just about student loans maybe we've never written about before. But by and large, it's a baby step to kick your student loan debt in the teeth yeah a deep dive into baby step two we talk about how to get on the budget how to work the debt snowball how to throw extra money on it how to refi and if refi

is a good option for you particularly uh but this is a great book dave if you want to introduce someone into a college grad into our world into our our tribe. This is a great book to buy for them and give it to them this season. We've got 4 million graduates who are graduating this year, and so that would be a great book for them just to introduce them into our teachings. Absolutely. Open phones this hour at 888-825-5225. Jeanette is in Pennsylvania. Hi, Jeanette.

Welcome to The Dave Ramsey Show. How can we help? Oh, hi. Yes, thank you. I just have a question. My husband and I kind of have a different opinion about he feels they should take out student loans for college just so that they can know how to manage their money better and just realize how like, you know,

how much money they're taking out. And he took out some student loans, and he is very frugal. I give him credit for that. And I didn't have any student loans, and my parents. His reasoning is flawed. Yeah. It's flawed logic. Okay.

He wants to teach his children to be tough and he wants to teach them to be smart but you don't teach a kid to drive a car about having them be in a car wreck yeah yeah no i mean i think he said he will help them pay it off you don't teach a kid to drive a car by putting them into a car wreck yeah you don't teach a kid to use debt by to stay away from debt by putting them into debt right right i i mean i think he wants to like pay pay it off for them or help them pay it off but he just wants them to learn to be in debt he wants them to learn to be in debt no and then their daddy pay it off my concern was yeah yeah i mean that I mean, he said that in the future they may need, in America, it's hard to not take out a mortgage.

I mean, I don't think he's for taking a mortgage if you don't have to, but, you know, he said realistically they might have to take out some. So just learning the process of it. Jeanette, how old are your kids, Jeanette? How old are your kids? One is 13 and one's 11. Yeah, so no, no, no. There are so many different ways that you can teach a 13 and 11-year-old how to be good stewards

and how to be disciplined when it comes to their money. Are you all teaching them how to budget right now? Are you teaching them how to give, save, and spend? I'm trying to. No, is he? Oh, is he? Yes. I mean, he definitely is trying to. No, is he? Oh, is he? Yes. I mean, he definitely is trying to.

Are they on a budget? You know. No. Are they on a budget? Um is no. Yeah. Yeah. Yeah.

There's different routes of doing this. And this is what Dave and I are saying. Like, teaching them to get into debt, teaching them how to rack up debt, teaching them how to go into a flawed future, a nightmare, that's not what you want. Okay. We need to step back, have a conversation with him. And you just got to, I mean, honestly, respectfully, I'm not married.

You can speak into this day, but you got to tell them, no, this is not what we want for our kids. And this is what I want. I want freedom. Well, his logic is flawed. That's the bottom line. I don't know if it's, you know, better. I think it's just doing the paperwork.

He wants them to know. How many times do I have to tell you this and then you go back? I think you're the one making the argument. I mean, what part of this sounds smart? I mean, I don't think it does sound smart, but I mean, I know I want to respect his opinion, but I don't agree with it. I can respect him and not respect his opinion.

I can respect him and say your opinion is stupid because it is. Yeah, I wasn't sure if we should just give them all the money for it and let them write the check for the tuition because it looks like we probably can pay for it. Or maybe you just write the check for the tuition, and then you put them on a budget because they've been on a budget all through high school from 13 to 18, and then when they go to college, they know how to stay on a budget and balance a checkbook. My kids were on a budget.

They had a monthly amount they had to live on in college. It was not much, and we paid all the bills direct for the college, and it did not ruin them, and it did not make them unfrugal, and it did not make them, you know, but they didn't them you know but they didn't have to learn out of you know what's the process i mean how is it positive to learn how to fill out paperwork for a student loan it's not how is that good i mean it's like i need to be able to go to i need to uh go down to the hospital and fill out paperwork to go into the er just in case i need to go into the er someday that's just no that's not a skill that somebody needs to learn no it's not and you know here's the thing you want to teach them how to be good stewards with their money.

Allow them to get a job. You pay for 90% of their school. Tell them they need to save up throughout the next few years to go towards their college expenses. That's going to help them out. Now you're really teaching them something because the average person in America do not budget today. So if you really want to give them a head start, teach them how to budget. Teach them how to live below their means. Teach them to start preparing for the future. Listen, our job when we have teenagers as parents, and I raised three successfully, they all live through it,

is not to teach them how to be kids. It's to teach them how to be adults. And when you go in and you say, I'm your father father i'm going to put my arm around you and i'm going to teach you how to be an adult here's how you fill out a loan application yeah you are setting that child up for a pattern of borrowing the rest of their life every time they need something because my dad said it was wise that's what's aggravating me here jeanette yeah you're this is the greatest endorsement a kid could have is from their dad or their mom to put their arm around them and say, oh, this is smart. It may take them a decade to get over you saying that.

Yeah. It's not smart. It's not okay. It's dumb. There's an epic student loan crisis. Do not lead your kids into this there is no justification for it whatsoever it's filling out a loan application is not a life skill that you have to have to be an adult that's just not a life skill that you have to have budgeting working being generous saving these are life skills that we are and it is incumbent upon us

as parents to teach teenagers i told my kids the whole time they're growing up my job is not to be your friend my job is to prepare you for adulthood so when you leave you stay gone except to bring back grandbabies that's your job my job is to make sure you do not end up in the basement because you are a financial illiterate. And they did just that day. They did. They left, and they have great boundaries and, you know, regularly tell Papa Dave what he can and can't do with their kids. So that's okay. That's part of it, man.

So, you know, your job is not to teach them how to fill out a dadgum loan application and build their credit score. That's just like, p like, bad, bad logic. Please don't do it, Jeanette. Hey, I'll tell you what. I'm going to send you a copy of Smart Money, Smart Kids that Rachel Cruz, my daughter, and I wrote together on how to raise money, smart kids. It was a number one bestseller. Maybe it'll help your husband.

Hold on. I'll send it to you. Business leaders, now more than ever, we need people with the right skills to support our communities, especially the frontline workers who provide resources and care for those most in need. To help, LinkedIn is offering free job posts for healthcare and essential service organizations that need to quickly fill critical roles with the people who help us all. If you are hiring for one of these organizations, free job posts on LinkedIn can help you quickly find the right people for your front line.

LinkedIn jobs can help by screening candidates for skills and experience you're looking for and putting your job post in front of qualified people who have what you're looking for so you can find the right person to quickly fill critical roles. To post a health care or essential service job for free, or if you're in another industry and have hiring needs visit linkedin.com slash ramsey linkedin.com slash ramsey terms and conditions apply my co-host today on the dave ramsey show anthony o'neill ramsey personality in an upcoming hour we're going to be talking about the time share industry and how scummy and horrible it is. If you have had one of those experiences

with a timeshare company and you want to share it here on the air, you can call at 888-22-PIECE, 888-227-3223. Or you can even email if you can't get through on the phones, and Kelly will call you right back at DaveOnAir at DaveRamsey.com. DaveOnAir at DaveRamsey.com. We are in the process of exposing the timeshare industry as basically being the payday lender of the vacation world. Scum. Scum upon scum. And like any other industry, there's a full spectrum of scum scum upon scum and like any other industry there's a full spectrum of scum from the ultra

scummy to the not so scummy uh but it all feels falls under the heading of scum so there you go now we're going to talk about it next hour and talk about what it is and what it isn't like it isn't an investment what it is is a black hole that you get stuck in and cannot get out of. So you got a timeshare problem you have had in the past, or you tried to go on one of those air quotes free vacations, got locked in a room for five hours while some slimy guy tries to force a timeshare down your throat, and you wished you had never heard of a free vacation. Yeah, we've heard these stories over and over.

So if you're interested in discussing the timeshare business, 888-825-5225. And if you're a salesman in the timeshare world and you don't like me saying this and you'd like to talk on the air, I would really enjoy talking to you. The phone number, 888-825-5225. That was bait. Did you hear it? And Dave on air at DaveRamsey.com.

Anthony, you know, in our world, we get to see all the lives that are affected when a bad concept is sold as truth. A car lease. A whole life insurance policy. A student loan debacle. A payday lender.

A timeshare salesman. A timeshare company that has regular practices that are fraudulent. I mean, it's unbelievable. Our job here at ramsey is very simple it's to show you guys where there is danger so you can avoid it because danger when it comes to your money equals you don't have your money anymore yeah you're getting ready to get

ripped off my land my lady my man yeah and we spent a lot of our time fighting for the consumer. We really do, Dave. And it's like, so funny. You're, you're going after the timeshares and I'm, I'm right here with you and I'm going after the payday lenders. You know, I've, uh, I've, I have a lot of family, uh, as far as in cousins, um, who are stuck in it. And it just bothers me because every time they get their paycheck, they have to go back and they feel like they're stuck and they just they're scared to get out of it because they got into it. And so I'm just seeing lives just change. Paychecks are gone. And it just I even had one cousin call me crying, just saying, how do I get out of this? What do I do? Because they're paying so much money back and they just get stuck into it. And every payday lender is 840% interest annualized. Annualized, sir.

Trust me. I mean, that's just no wonder. Yes. And they don't feed on rich people. They feed on poor people. They do. The working poor is who they feed on. They do.

Same people buy lotto tickets. Yes, sir. The lottery is your government selling you false hope, because the lottery is always sponsored by the government to send rich kids and middle class kids to college. It helps with the tuition program, right? Yeah. And, Dave, they're getting so creative now.

Now they're open 24-7. Now they're doing it via apps. Now you don't have to come in. They'll just direct deposit it into your account, and they'll automatically withdraw it. They're making it so convenient to where they're even starting to manipulate the people in it who who who don't even really really like they're not even in trouble but so well it's free money it's easy money and so it's just smiling people on the commercial yes sir i'm so happy that i got my loan yeah let me help you out smiling and they get creative doing this

coronavirus stuff like hey corona we'll give you an advancement on two paychecks. I'm like, no, you guys. No, no, no. I literally drove by there one day and my Instagram blew up because I took a picture and I posted on my Instagram stories. And I've seen a long line of people out there right in the beginning of this coronavirus stuff. For payday lenders. For payday lenders. And Dave, I'm screaming on the opposite side because I ain't want to get in trouble because being on a property but i'm like no

like no no no and people was like well anthony what do they do they need the money i'm like no but they do not need that money well that money is gonna kill them i mean you can't get away from it it's a wonder you didn't see a line like that for people wishing they could get out of their timeshare fees during corona because they can't visit the timeshare yeah but no they didn't see a line like that for people wishing they could get out of their timeshare fees during Corona because they can't visit the timeshare. Yeah. But no, they didn't get any. No, no, no break on the fees. No break.

Got all the fees. No break. You can count on the timeshare business to do one thing. Yeah. Make money off the back of people. David, I remember being young, young, young, young, and my grandpa went to one. And I was as a kid, I'm feeling like, ooh, this guy is mean. Yeah.

Because they're just going at you, going at you, going at you, going at you. And that's how they get you to really get in. Because, hey. Super high pressure. Come in. And then it's like, I really believe that some people just give in because they're tired of the pressure. Yeah. And it's not because they really want it.

I'm not ever going to get out of here if I don't sign. Exactly. So if you've got a timeshare story for another hour, the phone number is 888-825-5225 yeah we really don't care whether you buy one or not we're in the business of telling people where they're going to get screwed yes where they're going to get ripped off and how to stay away from it that's what we do here kim is with us in Arkansas. Hi, Kim. Welcome to the Dave Ramsey Show. Hi, y'all. How are y'all doing? Great. How are you?

I'm okay. I've got a quick question for you. I've been listening, just started listening to you last week, and I know y'all had a sale on books, but I didn't know what, I'm just completely just oblivious to everything. I don't know what to do. I don't know where I need to start. I mean, I know that don't make sense to y'all.

I'm so sorry, but I just. That's okay. How old are you? I need to know 50. 50 years old. Okay. Yeah, so. I need to know 50. 50 years old. Okay. What we teach folks is to get on a budget, a written plan, so that they can begin to achieve some of their financial goals.

The first one's being to get out of debt and build an emergency fund. So how much debt have you got, not counting your home? Well, a bunch. I mean, I had breast cancer in 2012 and got up you know still paying bills on that um radiation and chemotherapy and the oncologist how's your health um well two years later i was diagnosed with primary progressive multiple sclerosis. Mm-hmm. So it's, I mean, I know the government never gives you anything.

You got a lot going on. Are you married? Yes, I am. Okay. What's your husband's income? We have everything separate. Wow. Well, that'd be a problem as sick as you've been. Well, you know, I'll be okay. I just want to know how. Put money back in like a savings, you know, like an emergency fund. Yeah.

Okay. I'll tell you what I'm going to do. We're going to recommend that you and your husband start handling your money together and develop a clear path, a set of goals that you're going to begin to accomplish. We call those the baby steps. And the book that has sold the most at Ramsey is called The Total Money Makeover because it gives a very clear step-by-step plan. I'm going to give you a copy of it as a new listener. Thanks for hanging out

with us and let you read through exactly how to do the baby steps. And go ahead and read that with your husband. He needs to be on the same page with you. Very few people achieve financial peace, become millionaires, like almost none with their finances separated. And you guys need the help. You need to be working together to achieve those goals. You hold on, and Kelly will pick up and we'll send you a copy of the book, The Total Money Makeover, to help you get going, Kim.

Thanks for calling. Your refrigerator just went out, but you don't feel safe letting a repair professional in your home. Here's an idea. Fix your major appliances and power equipment yourself with parts and expert advice from my friends at Appliance Parts Pros. They carry over 2 million appliance and outdoor power equipment parts and offer easy 365-day returns. Get your parts today at AppliancePartsPros.com. this is the day ramsey show anthony o'neill is my co-host today, Ramsey Personality. Open phones at 888-825-5225. Lee's in South Carolina. Hi, Lee. How are you?

Hey, I'm good. Thank you for taking my call. Good. How can we help, man? Our goal is to purchase some land and build a home. My question would be, should we pay off our current house and debt or keep our savings liquid so we can purchase that property since it requires such a large down payment?

Are you out of debt other than this? Other than the home, we're out of debt. Okay. There's a couple of ways you can get after this problem. I assume you're going to build on the property, right? Yes, sir. And sell your current property, right? Yes, sir. And sell your current home. Okay.

Yes, sir. The best way would be to save up and pay cash for the land, and then when you get ready to build the home, you would take out a construction loan to build the home if you don't have the money to build it in cash, and the land will serve as collateral with the construction loan. The bank will take a lien on that. When the property, when the construction is completed, it will convert to a permanent regular mortgage. You would sell your current

home at that point and move into your new place and reduce your mortgage by that amount. That would be the typical way to do this. If you want to do it a little bit more strenuously, you sell your home now, move into a little apartment somewhere, take the money from your home and any other money and pay cash for the land, and then do this while you're living in an apartment. Build a home. That would obviously mean you'd have a lot less debt to go that route, but in either case, you need to have the land paid for. Paid cash for the property. Yes.

How old are you, Lee? 35. And what's your annual income? Combined is $115,000. Yeah. I like Dave's second option for you then. So what's the ground cost? The house? is 115. Yeah, I like Dave's second option for you then. Yeah, the, um, so what's the ground cost?

What's the ground cost that you're looking at? Around 100. How much you got towards it? We have 125 in savings. Oh, so you can just ride, check, and buy it. But we still owe 80 on the house and the small car payment. Oh, we need to pay the car off.

Absolutely. How much do you owe on the car? Yeah, 55 on the house and 25 on the car. I'm paying off the car today. Wait a minute. $55,000 on the house and how much on the car? $25,000. $25,000.

Mm-hmm. Okay. Well, you don't have enough to keep the car and do the land deal yet. Yep. So I would pay the car off today and save up some more money to buy the land, or I'd write a check, buy the land, and sell the car. Yep. But that car debt's got to go before we talk about going forward. I would not advise you to move forward.

But the good news is you've got enough to pay. You've got $125,000 saved, right? Yes. Yes. Okay. I would write a check today and pay off your car, or I would sell it. You decide. If you're going to write a check today and pay it off,

you only have $100,000 left, and you would need to save some more before you paid cash for the land. And then when you pay cash for the land, you can start the building process and sell your home later when your new home is completed with the builder, and you can take out a construction loan for the completion of that property. Now, make sure that when you do the permanent loan, the takeout loan, it's called, the final mortgage ends up with a 15-year fixed where the payment is no more than a fourth of your take-home pay. You've done a good job saving money.

Absolutely. A car sounds like the only weirdest thing in the whole story is the car. It doesn't fit in the whole puzzle. It doesn't. Like all this other stuff is wisdom wisdom wisdom wisdom than the stupid car 25 000 yeah somebody got a new car yeah yeah brand new yeah yeah something you got bit that's what happened there with a bug but yeah the uh i'm cleaning up the car i'm saying i mean i'm paying off today or let's sell it one of the two and then if you want the land worse than the car today

sell the car today yeah and then buy the land worse than the car today, sell the car today. Sell the car, yeah. And then buy the land for cash. Yeah. And get you a little cheap, inexpensive car to drive. Personally, I'd rather have land than a car. I'll get a car later. Yeah. Cars are a lot easier to come into, get out of.

If you found a particular piece of ground you like, I'm a guy that likes dirt. So I'm with you on that. It sounds like it's a nice piece of dirt, by the way. All right. James is with us in Wisconsin. Hi james welcome to the dave ramsey show thank you sir for taking my call i greatly appreciate it sure how can anthony and i help um so i just have a quick question um i just graduated uh the from the university of minnesota my wife and i just graduated congratulations we are both thank you sir. Thank you. We both graduated debt-free. I paid for our school cash with cash.

Wow. And I have about, yes, I have, and then I have over $70,000 in savings now between my wife and I work. Multiple full-time jobs while I went to school. My wife is an international student, so she wasn't able to work as much, but I made up for what she couldn't. And then so I'm just wondering, I've been listening for about five years now, and I pretty much have listened to every video that you guys have posted on YouTube, but I'm kind of wondering what's next now that I entered into the workforce

and I'm going into a job that is 100% commission. And so I don't really know how it's going to work until I get started. So what should, what should we do with all this money? Wow. I mean, well, here's the first thing I got to tell you, man, I love the fact that you have done what most people say they cannot do and go to college and graduate debt free. And you did two of them completely debt free. So I'm, I'm, I'm really,

really excited about that. But in regards to this 70 K James, here's the thing I really want you to do is just put that in part, that part, some of that into your emergency funds. So how much will they cost you all on the average month to live right now where you're at? Well,

right now we're, we're living with my parents until I get my, my job begins in the middle of June. Middle of June, okay. It got pushed back because of the virus because I'm in medical sales. So the hospitals are not a lot. Oh, yeah. And what do you think your average income will be in the year once you get into that specific career?

Well, it's tough to say, but out of the reps that are in my territory, they're averaging between 125, 175. Yeah, a couple of hundreds is what a lot of those guys might get. Yeah. Yeah, that's well done. Yeah. Well done. You landed a good job. And as soon as the hospitals are more operational, your income will kick off.

I think you might have a long on-ramp because of them not being open and not being back up to speed and the medical world not running full speed like it was. So if I'm you, you're in a transitionary period, I'm just going to sit on the 70 for right now and let's get this income flowing. Once the income's flowing, then you back it down to only an emergency fund and start your baby steps. And you know those.

You've been listening to us for five years, so you know exactly what to do. But I think you're in a transitionary period, and the industry that you're going into is a bad metaphor, but they're healing. Yeah. They're coming back to life after the whole thing being shut down with the exception of a few COVID beds. Yeah. And so it's been really hard on them financially as well.

And stay at home as long as you can, too, by any transitional period. Well, I'm okay. They're married. They're graduating from college. They got $70,000 in the bank. Go get you a little apartment or something. Okay. But I would anyway.

Because I think you're going to make two bills as you get this career up and running. You make one bill, you'll be in really really good shape because here's why i think you're going to do that because you're the guy that worked three full-time jobs to get two people through college debt free you are not afraid of hustle yeah and a person that will hustle like you know how to hustle can make money in the business you're going into you you're going to do well and you're going to serve and you help a lot of people with those uh uh devices that you will come to become i've got a friend two friends that do this and honestly they're very very proud of the the things that are made that docs can put in our bodies now to put us back together are freaking amazing yes and so it's a it's an industry you can be very proud of in almost every case.

So congratulations. Yeah. Very proud of you. Good stuff. Good stuff. Anthony O'Neill, my co-host this hour on The Dave Ramsey Show. We'll be right back. Folks, I love telling you about well-made, well-thought-out products. Today, I'm talking about Grip6 belts. I don't know about you, but I'm not a fan of traditional belts.

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There's so much you cannot control right now, and that's a little scary. But now is not the time to be a victim. Don't let the constant news cycle get you down. Don't let people tell you you have to take out debt to survive, and don't you dare pull out that credit card. Don't you dare cash out your 401K unless it's to avoid a bankruptcy or a foreclosure and if you're there after 60 days of this you were probably already there we're here to help you listen i know how it feels to be scared but all you can do is learn to control the controllables You can have a never again moment.

And for the very first time ever when this started, and we've continued it on through this crisis, through this shutdown, we're giving you a free trial to Financial Peace Membership for 14 days. You get a free 14-day trial for all of our digital content, including all nine lessons of Financial Peace University, full access to the EveryDollarPlus budgeting app, number one budgeting app in the world, and you even get the newest app, the Baby Steps app, to track your progress all free for two weeks. You can set yourself up to win even during times like this. You're going to be okay, but you have to have new information and apply it like you've never applied it before

so that this never happens again. Anthony, when you found yourself homeless in the backseat of your car, you had a never again moment, didn't you? Never again moment, Dave. And for me, when I got out of the backseat of my car, I went home and told my dad, hey, I'm ready to be a grown man, but I'm not a grown man yet. And I'm ready to learn. And I'll never forget the next day he gave me a budget form that you had out years ago. And from there, it started my journey. And then a couple of years later, I take the Financial Peace University course. And that transformed my life because it really taught me how to be a good steward and what does handling your money really look like?

And how do you really build true wealth, not the world's version of rich, but but really true wealth. And so I'm just I'm grateful for you, Dave, for allowing us to give this away for 14 days so that everyone can take this for all nine classes. But even when it comes to the budgeting and the free budgeting app, Dave, and a free debt tracker, here's the truth. You don't know what you don't track. And so if you really want to take control of your money, you need to track your money. You need to know exactly what's happening to every dollar, every penny. You know,

I'm not as wealthy as you. I've got a friend that works on our team here. You know him. He's lost 75 pounds. Oh yeah. You know, he did that. He tracked it.

He tracked his food intake. Yes, sir. And when you start tracking your food intake, suddenly you start going, uh, that chocolate chip bag of cookies does not equal weight loss. That's going to give it that.

Ta-da. You know, and all of a sudden things change for him. Yeah. And that's the same thing's true with money. So DaveRamsey.com slash hope. Yeah. DaveRamsey.com slash hope for the 14-day free trial. Coming up in a following hour, we're going to be talking about timeshares if you

have a timeshare story we want to hear from you right now we're going to leave some lines open uh just uh you can either email kelly at dave on air at davramsey.com or we'll leave some lines open at 888-22-PIECE 888-227-3223 if you have a story about your vacation that was supposed to be fun and it ended up being locked in a room with a slime ball trying to sell you a timeshare. Alice is with us in Canada. Hi, Alice. Welcome to the Dave Ramsey Show. Hi.

How are you both? Great. How can we help? I've been listening to you for a while and I finally started investing in mutual funds and I was just trying to decide, um, if I think I might want a house or property in the next couple of years, should I leave some of my savings out of that investment portfolio? Well, Alice, how much debt do you have right now? Are you out of debt completely? Yeah, no debt.

Okay, cool. So do you have a fully funded emergency fund three to six months yes okay yeah then yes if you really want to start saving for the house i want you to go ahead and part that into maybe a money market account or like an online high yielded savings account but you do not want to put that into your investment because then that's that's long term so if you are looking to save i want you to part that into a money market account or an online high-yielded savings account, whichever one is best for you. The problem is, Alice, I mean, if you had, say, $40,000 saved up and the market moved 10%, you could lose $4,000 of it. You could make $4,000 more than you would have made on parking it in a high-yield savings like Anthony's talking about,

which is really boring, but it's really safe. Right. And when it comes to saving up for my home, really boring is kind of cool. Yes. I like boring. Yeah, me too. Josh is with us. Josh is in Illinois.

Hi, Josh. Welcome to the Dave Ramsey Show. Hi, Dave. How are you? Better than I deserve. How can I help? Basically, I just had a question of if I should move out, because I'm 21, trying to find my place in the world, obviously, if I should move out

or if I should continue paying off. I have two things left that I'm paying off. I'm paying off a motorcycle and I'm paying off a car. Well, how much money do you make, Josh? Um, altogether, um, about 65,000 a year. 65. What do you own the motorcycle in the car? Um, the car about 20 on the bike, about eight. Okay. So I've been, I've been really you know hammering down on debt i was at one point about eight thousand credit card debt i started watching your videos and actually got a budgeting app and once i got the budgeting app mixed actually with the coronavirus the coronavirus been a little bit of a blessing because i um i've had the forced discipline of not being able to go out to eat

and all that so where do you uh putting all that in towards credit cards. Where do you see yourself when you're 30 financially? When I'm 30, I would like to have no debt, obviously, is the goal. What else? That's all? Well, obviously my goal is I want to continue to grow, and I do IT right now and continue to grow in that field and hopefully make more and more money.

You're doing really well. You're doing really well. You've got a good career field that you're in. You've got a great start for a young guy. Here's a rule of thumb that I've discovered. When you buy things that go down in value, they work against you on wealth building. If it's a small amount that's going down in value, it works against you in a small amount. If it's a large amount, it works against you big time.

And you have over half of your annual income or about half of your annual income tied up in vehicles of your annual income, tied up in vehicles. Two vehicles, and there's one of you. So, yeah, you've got to get really, really serious and knock these things out, or you've got to talk about selling them and moving down. One of the two. There's a lot of money tied up in things. The only things you own at 21 are going down in value, not up in value. And so you're way deep in this car, and you're even deeper in a toy, which is a motorcycle.

So, I mean, you can keep them both and push your way through and then move out or move out and then push your way through. I don't care, but I'm just warning you ahead of time. If you continue on this pattern, you're going to struggle to build wealth because people who keep all their money tied up in cars, motorcycles, boats, four wheelers, side by sides, tractors, lawn tractors. Oh, my God. If it's got a motor in it and wheels on it, it goes down in value. Yeah. Yeah, I totally agree. And you know what? Here's the thing you said, too. I want to call out. I agree with Dave. You said coronavirus has have forced you to be disciplined. Make sure that you keep the discipline even after the coronavirus. Okay.

Because that's another thing that's going to prevent you from accomplishing your goals that you want to accomplish by 30 is if you lack discipline. So make sure that you start growing that and keep that moving forward. But if I'm with you, I'm really writing. I'm sitting down. I'm saying, do I need both of these? Okay. And I'm just going to be real with you.

I'm selling a motorcycle. Yeah. I'm going to get rid of eight grand, put that towards the car, and I'm going to tax that, and then I'm going to move out of my parents' house. Six months. Yeah. Yeah. Give yourself a goal of being there no more than six months more and being debt-free by

then with some kind of movement. I don't care if you work extra, keep the bike, or sell the bike. But it's a good practice to go, and it was a mistake. I know it was a mistake because it's an $8,000 debt. Yeah. By definition, that's a mistake. So good question, man. You've got a bright future ahead of you. You're going to do really, really well.

Thank you for joining us. Timeshare calls next. If you want to jump in with your timeshare stories, 888-825-5225. We would love to hear from you right now. That puts this hour of the Dave Ramsey Solutions wants to give you some hope. For the very first time ever, we're giving you Financial Peace University free for 14 days. Go to DaveRamsey.com slash hope so you can watch from home.