The Ramsey Show - App - You Have to Become Allergic to Debt (Hour 1)

Episode Date: April 14, 2020

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

Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. Open phones this hour. If you join me, we'd love to have you call in. Chris Hogan, Ramsey personality, joins me this hour to answer your questions. Number one best-selling author of a couple of books, the latest being Everyday Millionaires. And he's been doing media all day long and will continue to throughout the day,

doing appearances everywhere, trying to keep people calm and keep them on the straight and narrow and no jumping off the roller coaster in the middle of the ride and all that stuff, right? That's exactly right, Dave. And the beauty of it is, is throughout these things, as I'm doing social media, Instagram Lives, Facebook Lives, I'm hearing two tales, Dave. I'm hearing the tale of people that didn't take it serious enough, and they're going, oh, okay, I need to get plugged into the baby steps.

And then I'm hearing another tale of the people that have been plugged in, had to follow the plan, and they're like, Chris, we're okay. We're okay. While everybody else is running around, we're fine. Yeah, the two tales of the financial part of the crisis. That's right. Yeah, there's the folks that are doing fine. You know, the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I mean, it's, you know, the stuff we've been teaching works in good times, and it really works in bad times.

And it's weird both times it's weird when things are going good to to stay out of debt and you look like a conservative freaky frugal crazy live in a cave click lint and only come out on triple coupon thursday i've got an emergency fund i don't have any debt um you know it's weird then and it feels like you're not taking advantage of all the possible ways you could be making money and leveraging yourself into a whole bunch of rental properties, getting deeply in debt. And then right now, you would look like a fool if you had done that. I know because I was that fool one time. The market turned, not as dramatically as this has, but the market turned, froze up, banking seized up and froze up, paralyzed.

And all of a sudden, my little world that was perfectly designed by the borrow-all-you-can people, you know. And, of course, that's the only way you're going to have a real estate portfolio. And I had a real estate portfolio starting from nothing. But it's all gone. It was all gone. Because when times turn south there you go when the tide goes out you can tell who was skinny dipping yes and uh that that's the two it is the two camps right now and you know the interesting thing about most of the people and i and i hope i hope the

rest of you hear me that are in the second camp where you're out of debt and you have your emergency fund uh be gentle with those other folk uh don't be waving your finger in their face um telling them how stupid they were because that was you one time yeah give each other grace out there yeah yeah let's just be kind and in the middle of all this and lift each other up help each other be generous of spirit and generous of pocketbook. It's a good time to be that. Daniel is in Maryland. Daniel, thank you for calling the Dave Ramsey Show. How can Chris and I help you today?

Hey, Dave. Hey, Chris. How are you guys doing? Great, man. What's up? Hey, I have a quick question. So we're on baby step number two, uh we have a lot of student loan debt um we have um around 250,000 we had way more but we've been chugging along chugging it down who's the doctor

or lawyer none of us we uh made some stupid choices you know getting more loans that uh you needed to get. And also, me and my wife went out of state. What are your degrees in? Mine is in cybersecurity, and my wife is a physician assistant. Those are both good. Yeah, they're both good careers. So you can make some money and clean this dadgum mess up, right?

So what's your household income? Together we make like $300,000. Yeah, I was thinking. Good. That's good news. So you're going to clean up the $200,000. How fast? That's another.

I called you about that before. My wife isn't 100% on board, and I've tried different things that you've suggested to try and convince her. So I'm kind of like tackling it on my own accord. But that wasn't the real reason why I called. The reason why I called is because we have a rental property that we had that we still have that's 100% cash flow. We've paid down the mortgage 100%.

So it's actually a condo. So it has condo fees every month of around $300, but still cash flowing. What's it worth? $100. We bought it for $80-something. It's worth probably like $180-something right now. And the reason why my question is,

do you think it's worth keeping and keeping that $1,100 cash flow or selling it and using that $180 or whatever I get for it to pay down this debt quicker. Daniel, as you toss around that idea, what does your wife think? To be honest, I haven't even asked her the question yet because I've asked her before in the past and she said no she was totally against it she was like that we should keep it because it's a long-term investment yeah and we can consider you making the money Daniel here's what I want you to do she's not understanding buddy she is still counting the way that the world counts I want you to sit down do you all have kids yes how many two many? Two. How old are they?

One is five and one is two. Did your wife come from money? No, she did not. Did you come from money? No, I did not. I didn't think so either. See, as you see them two young kids running around, you guys have an opportunity. You can serve up more of the same where the world counts and counts wrong.

One plus one equals three. Or you can take her by the hand and look at them two little kids and say, baby, if we can sacrifice, if we can connect and row in this boat together in the same direction, we've got an opportunity to do something special. And that special thing means sacrifice, my friend. See, you've been talking at her. I want you to talk to her heart. I want you to hold her hand and communicate to her. She needs to hear you, and this is about you all's future. And so you all are tiptoeing right now, and you're tired. I can hear it in your voice, but it's time to unite.

Have you considered the idea that Financial Peace University is a free 14-day trial right now? Could you possibly get the two of you to sit down and watch a couple of those videos together um i can definitely um suggest it to her um because here's the thing listen here's the thing okay 90 of your problem for your future wealth building success is that the two of you are not working together. I agree. 10% is your student loan debt in this condo. If you're working together, I'd sell the condo in a heartbeat,

but you're trying to fix something without fixing it, and you're working on the wrong thing, dude. So, no, I would not sell the condo until you guys get on the same page because you're just simply not going to win. We found no zero number out of the 10,000 millionaires that we interviewed. We found zero that became millionaires against their spouses' wishes. They all, 100% of them, worked together. They didn't all work the plan exactly the way Chris and Dave would have told them of them, worked together. They didn't all work the plan exactly the way Chris and Dave would have told them,

but they were together. That matters so much as a data point indicating your future success. I spent all my time working on that instead of selling the condo. This is the Dave Ramsey Show. If you do this one simple thing that we all do, you are literally at risk of being hacked and someone stealing what you've worked so hard for. Do you ever use public Wi-Fi? I'm talking about getting online at a coffee shop, a store, the airport, or even at home. Hackers can use a simple $100 device to mimic Wi-Fi, and with just a little bit of skills, they can take over your financial life.

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me answering your questions this hour rebecca's in new y. Hi, Rebecca. What can we answer for you today? Hey, how are you? Thank you so much for having me. Sure. So I have a question. My husband and I bought a house four and a half years ago. And this year, it's been my goal to pay off my home mortgage. Great. So our house is 323. And we have a little bit under 30 grand left. I have 80 grand in the bank. I wasn't sure if I should. And I have no other debt. Should I pay off my house now during this whole COVID situation? Should I hang on to my money? I'm just I'm still still working too. My husband is laid off, but I'm still working. So I wanted your thoughts. What was he, how much does he earn

a year? Around 50. Okay. What do you earn a year? 450. You earn 450,000 a year? year yes sir wow what do you do um i'm in device sales wow okay so you lost uh 10 of your household income when he got laid off did i do that right i did that right yes yeah okay, Chris, what do you think? Rebecca, it's time to write that check. I agree. Write the check. Before nightfall. Yes.

Tonight, light some candles as you fix dinner and have a celebration. Your home is paid off. All right. Do it. I mean, your income is stable your income is huge you have you know you you'll still have 50 000 cash in your emergency fund uh and you'll be 100 debt free yeah this is a no-brainer yeah write the check okay all right Thank you guys so much. Congratulations. Thank you.

Very well done. Alexander is with us. Alexander is in Ohio. Hi, Alexander. Alexandra, I'm sorry. Alexandra, how can we help? Hi, Dave. I'm so excited to be speaking with you.

You too. And Chris, I am in Baby Step 3, thanks to your teachings. And I've just been a huge fan. You've completely changed everything for me. But my question is actually about my mom. She turned 60 this year, and she's a single mom, always been a single mom. And I'm wondering if she should get long-term care insurance. So using your guidelines, I think she's kind of on the cusp. She owns her house flat out., it's about $250,000,

and then she has about $500,000 in a retirement account, and her only debt is a $40,000 parent plus loan for my school, which I try and convince her to pay off, but I can't. I mean, part of my question, too, is also how can I get through to her to kind of improve her situation, because she's currently only working a couple months out of the year, making minimum wage, but she's very capable of much more. So, yeah. Okay. Well, if she is single and no one is counting on her income and the $500,000 she has invested would create enough to pay for her nursing home care. She's willing to say, I'm going to spend $50,000 a year on nursing home,

and she wouldn't need long-term care. If I were in her shoes, I would buy it, though, because she is right on the bubble. Your cusp, you said, the bubble. Yeah, I agree with that. And then, you know, when she gets her net worth on up there a little ways more, then I might drop it and just say I'm self-insured. Yeah, I wasn't sure. She was pretty close.

Yeah. Alexandra, why is your mom resistant? Has she told you? I mean, the premiums are expensive. And like I said, she doesn't make a lot of money. She was in sales for a long time and made a ton of money and then got laid off a couple times and then just kind of gave up and now she's not really generating much of an income she can barely live on what she makes um so i think she just doesn't want to pay the premium um so i mean i tried to convince her to do financial peace especially now that it's free um she won't do it um but i just i long the long-term care is what

keeps me up at night because i don't want to you know so what happened at the last job that broke her heart i don't i mean it was like several for a couple years in a row she used to work in medical publishing which has changed a lot i mean and i think i think there's some mental health issues there as well. But yeah. Yeah, it sounds like her heart was broken. It sounds like she just got hit one too many times in the job market and it broke her heart. And so rather than risk rejection again, she's hiding. Yeah, exactly.

That's pop psychology for what it's worth, but that's what it sounds like from an old man's perspective. So I would work on that part, and the rest of this stuff would heal itself, and that's going to involve being in a good church, that's going to involve reading Ken Coleman's materials, and learning about a career that you love with people that aren't toxic and that you love and plugging into something because if she could find something that utilized her skills in a place that was safe with good people um she could make a ton of money but she's scared yeah and uh so hold on. Let me send you a copy of Coleman's book, A Proximity Principle

for you to give her. Yeah. And let's do that. Because I think the there's, you know, she's making $100,000 a year again, instantly that you wouldn't even be asking this question and she wouldn't either. That's right. And Alexandra, I would tell you to also congratulate her on what she has done. Yeah. She's paid off the home. She's got a half million in retirement. So she's done some good things. And so I would lead in with that and just say, mom, you know what? I want to look at protecting you and to make sure you're nest egg and you're able to do the things you want. And just like Dave said, begin to kind of help her pick herself up psychologically and get her confidence restored. She's still young. She's got a lot to offer the world.

Yeah. The world is being cheated by her not being engaged. Because you can't be in sales long term and not be able to sell. Right. I mean, that just doesn't happen. Yeah. I mean, well, not most of the time. You're right.

Yeah. It's very, very unusual. So, all right. Mark is with us in Delaware. Hey, Mark, how are you? I'm doing well, Dave. How are you and Chris doing? Better than we deserve.

What's up? So I was looking to get some advice as a first-time homebuyer. My wife and I are on Baby Start 3B, which means we're completely out of debt, no debt whatsoever, so I thank you for that. I'm the only one working right now. My wife is staying at home with our newborn. I bring home roughly $5,200 a month. So I just wanted to get some advice as a first-time homebuyer.

What to expect, what type of price range I can look at for my income, and basically what things to look out for in a house and basically just pitch your advice on the whole process, especially with everything going on right now, if maybe I should wait a little bit to buy with the virus going on right now to see if the market drops, or I just wanted to get your take on that. Yeah. No, you, listen, let me start off, Mark, by congratulating you for getting out of debt and having an emergency fund. And I'll kind of tell you this stuff to avoid. And I can tell you this firsthand, my friend. First things first is do not allow the bank to tell you how much you qualify for.

Okay? Okay. I mean, I'm serious. It is ridiculous how much they'll approve you for, and it can be way out of your price range. So you want to establish what you're looking for in that dollar amount. Number two, work with a reputable real estate agent. That's why I highly recommend our real estate ELPs, because you only want to go look at homes in your price range. Okay?

Do not even entertain. And I've heard people say, well, this one is $20,000 more, but we'll go look. We can talk them down. Don't do it because you're going to fall in love with that house. So those are two big tips. And I want you to hold steady at your dollar amount. Be very clear. Is your wife planning to go back to work

or is she going to be at home with the newborn? She says she wants to go back after a year, but I can just tell by how she is right now that if she doesn't go back for her degree, that she's going to want to stay at home. Okay, now I can tell you this. My third and final tip, then I'll turn it over to Dave.

Find something that you qualify for based on your income, in your income only. That's going to be absolutely imperative so you don't feel that scrunch and that crunch of the pressure. Yeah, and you know, when you do, you take out a 15-year fixed rate mortgage where the payment is no more than a fourth of your take-home pay. And so that's going to put you in the $150 to $180 price range in terms of the loan amount. Add your down payment to that. But that's going to put you right around there, and you're going to be fine. But fixed rate, 15-year, where the payment's no more than a fourth-year take-home.

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Finney, a few minutes ago, Chris, that said that one of the huge spikes during this time is online learning for kids, teaching kids online, and online learning for yourself. That's gone crazy. And people's amount of time they spend reading has gone up. And so what we've done is we've tried to plug into all of that. We've got our high school curriculum at DaveRamsey.com slash hope at a rock-bottom price.

The same thing, of course, Financial Peace University Online, the premium product, a 14-day free trial. You can take it at home. And at DaveRamsey.com slash hope, this week we decided to put every single book we have at $10. So both of your number one bestsell ten dollars each wow it's a good deal that's a great deal and a total money makeover all of rachel's number ones all of colman's number ones uh anthony o'neill's number ones all of them even anthony's brand new one that just was just a

number one the other day we usually wait about a year to do them on ten dollar special we put them all out there ten bucks each and uh and put a special deal on all the audio books as well and the envelope systems. And so you can not only get some things for you to read that you've been waiting on, and we'll deliver them quickly. Our fulfillment center has one job, and that's send out books. And so we don't prioritize. Right now Amazon's prioritizing on you, and non-essential items are coming a week later than quote-unquote essential items.

So we think it's essential you get this. If you want it, we're going to get it right to you. So you can get it quick. The $10 sale, buy all you want to buy or as few as you want to buy, mix and match, $10 each. Go to DaveRamsey.com slash hope. You can see all the stuff we're offering there. Some really, really good stuff for those of you that are, you know, you're sheltering at home and you're using this time to grow your brain instead of rot your brain by binge-watching stuff on television

that is, frankly, awful. And I've done it too, and so I'm a personal witness to it being awful. All right, Nick is with us in Utah. Hey, Nick, welcome to the Dave Ramsey Show. Thanks, Dave. Thanks for having me. Sure. How can Chris and I help?

Well, first of all, thank you for taking my call. And secondly, I am on Baby Step 2, and I have paid all the other debts except for student loans. And my student loans are in two different institutions. One is $20,000. The other one is $23,000. And I'm wondering which one to tackle first. Are they both Sallie Mae? They are not, ironically.

They're both private? Yeah, I believe so, yes. Okay. Well, tackle the $20,000 one. It's the smallest. Why wouldn't you? Okay. Well, the $23,000 one, the monthly payment is $444.

And the $20,000 one is $170. Yeah, but neither one of those payment amounts matter because you are $43,000 from being debt-free. That's all that matters. And so when you come up with $43,000 is when you'll be done, right? True. And so the payment amounts are a ghost mechanism. In other words, if you got rid of the $400,000, it does not accelerate your get out of debt.

It just feels like it does because you still have to put $43,000 on the table over the next several months to be debt-free. So how much are you paying a month on all this? Well, I'm currently in school. I'm finishing up, hopefully going to finish up my last semester, but I realized I don't have to make payments while I'm in school. So I just want to work as hard as I can. School is going to be online, so I want to work as hard as I can

and pay this off because I want to be debt-free for my kids. Love it. So what are you going to be doing? What's your degree in? I'm going to be getting a film degree with the hopes of becoming a film director, but I'm currently working at Amazon as a truck delivery driver. Okay.

So when will you graduate? Hopefully in August. Okay. Emphasis on hopefully. Okay. I got will you graduate? Hopefully in August. Okay. Memphis is on hopefully. Okay. I got you. Chris? No, I'm proud of you, Nick. You know, that mindset, what Dave was showing you is the difference in the way the world counts and the way we help people get out of debt.

And so it's not about payment. It's about dollar amount. And so attacking smallest to biggest is always going to be the way. But I'm proud of you for the focus that you have and the way you're moving forward. I just want to, I want you to catch this one allergy. I want you to become allergic to debt. Okay. I mean, seriously, I mean, seriously allergic, like not for a vehicle, not for anything, not for a film project, nothing. And so once you have that kind of mindset, it's going to help you see things totally different, Nick, and the future will be wide open for you, my friend. Yeah, and so it's $43,000.

Yeah. And so $4,000 a month is 10 months. $2,000 a month is 21 months. So 22 months, 11 months if you do it. So, I mean, that's why I was asking you how much you're going to put on it, because that's the payment amount that you care about. Right. You should just take that amount, divide it into it,

because you're going to pay some interest in addition to that during that 11 to 22 months or whatever it is, but it's not an appreciable amount of the situation. I mean, let's think about $43,000. If you kept it out the entire year and you won't have it out the entire year because you're reducing it aggressively, would only be $3,000, $4,000. Probably be about $2,800 roughly in interest. And so $2,800 is not a $43,000 problem. Oh, and by the way, you will not have forty three thousand dollars outstanding because you're reducing it at two thousand dollars so that interest figure is even wrong so again the the big deal is i just do simple big number division in my head when i'm talking to you

here because that's about the way it's going to turn out and so once you get landed after graduation and you know what your income is going to be. And it could be Amazon truck driving plus something else or minus something else. I don't know. But then you just say, OK, you know, divide three thousand dollars a month into this. That's what I'm going to be done. And you can use our debt snowball tool online. You can look at all that stuff. It's a little bit more sophisticated than that. But, you know, three thousand dollars a month, thirty six thousand dollars in a year that just about gets you there. It really is. And Dave, here's what's scary. But, you know, $3,000 a month is $36,000 in a year. You knock it out. That just about gets you there. It really is.

And, Dave, here's what's scary. We are taught initially to do the math based on payment. I can afford it means how much down how much a month. How much a month, which we have seven- and nine-year car loans coming right now. Oh, yeah. Seven and nine years, which, you know, just baffles me. You know, you can roll the window down and hear the value leave as you drive off the lot. But you're going to have another seven to nine years of making that payment.

That just doesn't work. Doesn't work at all. Sarah's in Oklahoma. Hi, Sarah. How are you? Hey, I'm good. How are you? Good. How can we help? Good. Okay, so I am just getting started. I have $1,000 in an emergency fund, but I have two debts, student loan debt and a car. But my question is... How much do you owe on the student loan? Just under $25,000. And how much on the car? $14,200. Okay, and your question is? My question is, with the case that we have where you're at zero interest right now and zero payments essentially on student loans, all of my student loans have different interest rates.

And so I know you're a huge fanatic of the snowball and paying off the lowest amounts first but with some of my student loans the higher percentage rates are obviously higher and so I have a big chunk with the stimulus check coming in um refund from taxes and things like that that I want to throw too but I'm just like do you throw off to the smallest amount or do you keep rolling with it and and the reason is not the interest rate. It's the same discussion as last time. You have $14,000 and $25,000 is $39,000 in debt. Divide how much you're going to pay on your total debt into $39,000.

If it's $3,000, it's going to be just over a year. And you just look at that, and that's what tells you that you're going to be fine. And the interest rates are virtually irrelevant in that short period of time. So knock out your smallest to largest. That's why I'm a fanatic about this. Not because Dave invented it and it's ego-based. It's because it freaking works. I wish you were my math teacher.

It would have been easier. Business leaders, hiring right now may be the furthest thing from your mind, but the fact of the matter is we will recover. One of the smartest things you can do for your business is to be prepared. I want you to know that my friends at LinkedIn are ready to help you find the right people for your business when you're ready to hire them. LinkedIn Jobs matches your role with qualified candidates so you can find the right person quickly. LinkedIn Jobs looks at things like collaboration, creativity, adaptability, and puts your job post in front of qualified candidates every day.

So your job is seen by people looking for jobs just like yours. That's why we use LinkedIn Jobs when we hire here at Ramsey. When the time comes to hire for your business, you can get $50 off your first job post at linkedin.com slash Ramsey. That's linkedin.com slash Ramsey. Terms and conditions apply. Ramsey Personality number one bestselling author Chris Hogan joins me this hour answering your questions. The Chris Hogan Show is available on YouTube, all the places you get a podcast, like Apple or Google.

SiriusXM also carries this podcast as well. And check out ChrisHogan360.com. All kinds of good tools there, including the Net Worth Calculator, which will help you gauge how you are doing on your everyday millionaire journey. Because net worth is everything. It's not your FICO score. No, it is not, Dave. And we're guiding people in that. And we're having a lot of fun over on the show. I've got a couple of segments people are getting a kick out of.

I've got a did you know. This is where I kind of give them a fact. Most of it's coming out of the book, Everyday Millionaire. And then I've got a panicked or pumped segment, Dave. And so if people are feeling panicked about something, they reach out to me and we kind of talk about it. I coach them right where they are. And if they're pumped about something, we take the time to celebrate.

And people are really, really enjoying that. So I want to encourage you to hop over to ChrisHogan360.com and come on over and join the party yeah it's on instagram uh he's out there every day between 11 11 30 on his instagram doing live on that and uh so you can get in touch with chris uh other places other than just when he does an appearance here um so uh be sure to keep track with chrishogan360.com. Samantha is in Indiana. Hi, Samantha. Welcome to the Dave Ramsey Show. Hi, guys.

Thank you so much for taking this call. Sure. What's up? My question is this. My husband and I are on Baby Step 2, and our remaining debt is student loans. Combined, we owe $117,000. Recently, we'd had two different family members off to help us pay down this debt. And I don't know if it's my pride getting in the way of wanting to accept their generosity, but I feel like it's our mess and it's our responsibility

to clean it up on our own. And my husband feels a little differently, so I'm seeking your advice. Okay. Are there any other issues, like you would be judged or they would interfere in your life, or there's toxicity attached to the gift? Not at all, no. We are very blessed with our family and and they're coming from a place of love um and they have they have the money it doesn't leave them in any damage

right my husband's grandmother is the one person who is offering to pay a substantial amount uh up front like a sum and my mother is offering to help make payments. Now, I know my mother, while she has a very high income, I know she has debts of her own, and I want to see her complete her financial plan, and it feels almost selfish to take money when I know that she's got a few lingering debts of her own. Yeah, she needs to clean up her mess. She doesn't need to be giving you money. I agree.

Yeah. And, Samantha, how did you say your husband feels about this? He was very excited when his grandmother offered to pay quite a nice sum of money. What's the dollar amount she's talking about? She will pay off his balance, and his balance is $17,000. So she would wipe his away. Um, when I mentioned that my mom would be offering to help, I mean, he was like open, like, that's great. That'll help us knock this debt down, you know, cause our plans are to go forward and pay down this debt and get

our first home and progress, you know? Um, so he's, he's on board, but I feel like I've made such a huge mess and I've been complimenteded by my family on how much maturity I've gained through the program financially, and I feel like by accepting money, it'll take some of that. No, I think if the people are in condition to give the money, if they're in the right place, now your mother is not. She does not need to be giving you money, okay? She has an income, but she's broke. So she doesn't need to be giving you money.

So the people are in a good place, and there's no toxicity, meaning they're not going to come over and feel like they can tell you what color to paint your bedroom after they gave you some money or something. You know, there's no control issues attached to the money, and I'm sure with grandmother there's not. So grandmother's offering $17,000 as a gift. Do we have any idea how much money grandmother might have, a million, 10 million, or 18,000?

Oh, it's so hard to say, but my husband has kind of indicated that he thinks that she is a millionaire. Okay, so $17,000 is no stretch. That's what it seems, yes. Yeah, and if we're not leaving her harmed and she's not going to interfere, then I think it's a wonderful gift from her, and I would accept that gift and say thank you. Okay, thank you. Great, thank you so much. And I would not accept it from your mom because your mom's gift and say, thank you. Okay. Thank you. Great.

Thank you so much. And I would not accept it from your mom because your mom's broke. Yeah, that's right. And Dave, you're absolutely right about the toxic thing. Because see, if someone's giving you something that's got some strings attached to it, that's not a gift. That's called a loan. Because at some point they're going to pull on that thing back.

It's called a lure attached to a fishing pole. That's exactly right. They're going to pull on that lure attached to a fish exactly right they're going to pull it back and so the spirit needs to be the right way and and i agree with you i think that's so important because what you don't want to do is block someone's blessing if they're trying to be kind and generous to you now if they tell you on the front end here's the terms of the gift and that's all there is it's not it's not going to be ongoing then you can you can accept those terms right then that's okay you know and so if it's something weird you would say no but uh you know for instance i know a friend of mine gave his kids enough to pay off their home under the condition they promised to never borrow again. Now, that's a good.

Absolutely. But he doesn't go over there and go, now, let me see your wallet. Let's see if you've got a credit card. Right. He doesn't do that. But they know, and they're honorable, his kids are, that they're not going to drive up in a car with a car payment after he gave them the money to pay off the house.

That's right. Because that was the condition of the gift because he's trying to break the chain on his family tree. He's trying to say, no more. It ends here. And so that's a conditional gift that isn't toxic. Yeah, absolutely. But if he's going to give them money and go, well, you have to name your first kid after

me, that's toxic. It's probably a great idea, but it's also toxic. Yeah, you can't buy that well what's funny is i worked with a lady years ago her and her husband had built a net worth of three to five million and one of the conditions in the trust so that her three sons have to go through financial peace university yeah every other year whoa if not they forfeit the money that year to a charity whoa and it is in stone she goes they're not going to fritter this away. Wow. She goes, we work too hard.

Yeah. And her spirit was right. Yeah. In the midst of that. That might be a little much. Every other year for the rest of their life? Every other year for the first five years. Oh, oh, okay.

Yeah. Okay. So three times and it takes. Three times. I got you. Right. Okay. Yeah.

All right. That's fine. That's not as bad. I have heard people putting Financial Peace University in the will. I have heard that. Yeah's not as bad. I have heard people putting Financial Peace University in the will. I have heard that. Oh, yeah. But I'm more concerned with, you know, then they're going to question, once you're debt-free and you're handling money right, you went on a cruise?

You went on vacation? Mm-hmm. You know, and they just start, the money gives them permission to constantly interfere. And as our friend Dr. John Deloney says, or my friend Dr. Henry Cloud says, violate boundaries. Yeah. You know, they're going to come in and just walk around in your living room metaphorically in their muddy boots, you know, and tell you how to do everything from then on. You can't accept that. That's not a gift.

That's just a control freak. It is. And so you just have to gauge that out. And then you look and say, you know, can mama afford this? Can grandma afford this? Because a lot of parents, I mean, the number of calls I've taken over the years where the grandparents were buying stuff for the grandkids and they were in debt. Yes. And couldn't afford it. I've taken that call on the show here hundreds and hundreds of times and the you know the mom and dad are like 35 or 30 or whatever and they're

going my parents are broke and yet they keep spending all this money that they don't have on the grandkids and it's like well grandkids are excused to be stupid i mean but that's really and they said it's just offensive and i don't know how to stop it. And that's somebody who's, again, it's a toxic situation where, you know, folks are not living within their means, and it's not a blessing. But if you've built up money, and you've changed your family tree, and, you know, you're like Granny there, you're an everyday millionaire, and you want to reach over and help your grandson pay off $17,000,

that's a wonderful thing. Yeah, it is. It's a wonderful thing. It really and truly is. Chris Hogan, ladies and gentlemen, thanks for stopping by, Chris. Thank you for having me, Dave. It's always fun. Appreciate you hanging out this hour answering questions.

That puts this hour of the Dave Ramsey Show in the books. Our thanks to James Childs, our producer, Zach Bennett, our associate producer and phone screener. I am Dave Ramsey, your host, and we'll be back. In the middle of these uncertain times, 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.