The Ramsey Show - App - You’ll Never Be Able To Borrow Your Way out of Debt

Episode Date: August 26, 2024

Live from Nashville, Tennessee, this is the Ramsey Show, where we help people with their money, their relationships, their life, building wealth, getting out of debt, all of it. I'm John Deloney, joined by my good friend Jade Warshaw, and we are live. Taking your calls at 888-825-5225. It's 888-825-5225. Call in from all over planet Earth, and we'll do the best we can to get to your calls and answer your questions on just about anything. Let's go out to Chicago, Illinois, and talk to Jake.

What's up, Jake? How we doing, brother? Hey, guys. Can you hear me? Yeah, I got you, man. What's up? Awesome. Thank you so much.

God bless you both. Thank you. Just calling for a relationship question. I've got a girlfriend now. I've been dating just for over a month and she comes from out of the country actually. Um, but she's been in the U S for a couple, a couple of years now, and she's trying to get rid of her debt.

She's on the baby steps doing every dollar, but she tells me like she's being overwhelmed because she's trying to also, or, um, her family overseas is asking for money. Unfortunately, um, they grew up, of in poverty, so they're struggling. And I'm just trying to get relationship advice from you guys on how to handle that on the sideline and be supportive and give advice. Where is she from? I just want to say that's South America. Okay, that's fine. So that's a very, very, very, very, very common thing.

Millions and millions and millions and millions and millions of dollars are sent back home when one or two or five or six family members make it to the U.S. And so being in this new relationship for a month, I would sit with her and keep my mouth shut. I know that's right. And I would say, man, I know that's really hard. I know that's tough. I know you're in a pickle. I know if like, I want you to sit and hear her.

And unless she specifically says, do you have advice for me on how I can get out of this situation? Which I doubt that question will actually come. I want you just to be present with her because she's probably pretty sharp and she's probably pretty smart. And she probably needs you to be near her and needs your uh emotional support

more than she needs your your your facts does that make sense yep yeah i got you um yeah jay do you have anything there i mean i guess this kind of is what it is man y'all been together a month that's different to you were married five years or something like that yeah i i agree i think the cultural difference changes the rule slightly because that is true like depending on what your background is from or even if you have family that are still there there's a lot of cultural differences where yeah it is kind of like a a family household and it's like listen the everybody contributes and she's probably still bringing some of that mindset here even though she now lives in the states and to john's point i 100 agree i wouldn't touch it with a 10-foot pole

and i would let her do her thing for now and as the relationship progresses you know maybe there's a time where you guys talk about it when you're like engaged and that sort of thing but right now let her do her thing and jake this is a question that took me about 20 years of being married before I realized it would have been smart for me to ask and that is do you want me to give you a solution here or do you want me just to listen and be with you so if you ever feel like you're getting trapped or you feel like she's asking you veiled advice questions whatever just say hey do you want me just to sit with you or do you actually want me to tell you what i think you should do next and give her an option on on what

you should how you should proceed does that sound good yeah i like that okay all right brother well thanks for the call man best of luck to you let's go out to george in tampa what's up george hey guys how's it going we are rocking on to the break of dawn brother what's up, George? Hey, guys. How's it going? We are rocking on to the break of dawn, brother. What's up? Well, hey, I just have some desk stuff going on. We just bought a house, and we're thinking about moving back to Texas, basically. And the house, we bought for $740. Currently owe $690 on it.

We have $150K to do loans and $25K on a car as well. We've got some work stuff going on, so just trying to figure out. What's the house worth if we sold it? We think. I mean, we've been talking to a realtor lately, at least. We're hoping to at least get $740,000 up to anywhere up to $799,000. She wants to put it on for $799,000. But in this market, that's what we're kind of afraid of.

So you think you'd only break even? Worst case, yes. Okay. You'd break even minus fees, so you'd actually lose money, right? Exactly, yeah. So, I mean, plus the money we've, I mean, most of the money we've been putting into is interest. So we just, you know, we only put 5% down originally. Yeah.

Why are you moving so quickly? Well, two things. You know, we want to get around family. We have a one-year-old, so We wanted to get around family. We have a one-year-old, so we wanted to get around family and then we're trying to figure out what to do next. We actually live in Sarasota, but we're kind of bored with it already. We didn't know that when we

first got here. Kids kind of changed things and kind of just went into life, started buying stuff. But you bought a house for three-quarters of a million dollars. Well, I was making another thing that that's happened i was making a quarter million and my wife was making 60 and then didn't seem like that crazy thing at a time which now i'm thinking about it it was crazy and then my job they did a comp plan change and then the markets kind of shifted in my field which is you know i'm probably make like still good money, like 160, 180, but I'm just, we've been talking about like maybe resetting, going back to

renting for a bit, stacking the accounts again, paying off the student loans and kind of getting back on track. Can you tell me more about the other debt? Well, we have student loans, went to private education. How much? Well, 151,000 left. Okay. Anything else?

Just the car payment, which I'm still something that's $25,000 left on it. $25,000. Okay. And there's nothing else? No credit cards? Nothing. Yeah. I have money in the account. We have about $37,000 in the accounts right now. And then I got the retirement accounts too. Nothing crazy. I got like $50,000 in the accounts right now and then i got a i got the retirement accounts too nothing crazy i got like 50 grand in the retirement and then that's not weird i know i need to sell it my coinbase account has 15k yeah okay so here's the thing the good news um is you've got some liquid cash sitting around here you're going to liquidate the coinbase um i would if i were in your shoes to make this right side up the good news is you can turn

around and pay off your car today. Today. And then you can take the other 12,000, put it with the 15,000 and take that 27 and put it towards the student loans. And now you're back in a situation, you got $125,000 of debt and that's a lot more manageable knowing what you guys's income potential is yeah right so i don't i don't think that the solution to your situation is necessarily selling the house unless you can no longer afford it that's the yeah we can but it's coming to the point where it's like is it becoming more worth it in a way because we we really want to move and that's another factor that's kind of playing into it i don't know so you don't love the house that is a big factor if you don't love the house um i don't want you to move at a loss if you don't like the

house i'd like to wait till you got right side up and just be patient yeah uh what percentage of your income is the house after good question of your take-home pay take-home pay i mean that's a great question i don't know that answer to be honest i don't thought in my head i should but that's okay let's figure it out let's think about it so what are you guys taking home right now taking home i i get paid bi-weekly and right now i'm getting paid around five grand bi-weekly and then she is that's 10 probably pulling yeah she's pulling in like you know 2k on her checks right now okay so that's 12 commission so very slightly but usually around 12 she's okay pulling 2k a week or 2k a month

uh 2k a week uh 2k every uh she's semi-monthly so two payrolls a month okay so 14 000 that's all you need to look at figure out out what 25% of that is, and then you're going to see, okay, can we actually afford this? If you can't, that's a good indicator. It shouldn't be any more than $3,500 a month. So that's what you're looking at. I would not sell the house simply to pay off this debt. If you hate the house and you're right side up, be my guest,

but I don't think it's the solution that you need to get your behavior on point. There you go. And I will say, one time I took a check to closing to get out, and it changed my life. So make the right call. We'll be right back. Hey, you guys. Health insurance costs are only moving one way, and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer, and it's

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if you're listening on YouTube or the podcast. It's $36. Get it right now. It's going to go up after September 2nd. So get it as quick as you can. All right, let's go out to Chicago. Let's go back to Chicago and talk to Mike, Mike, Mike, Mike, Mike. What's up, Mike?

How we doing? Hey, real well, guys, and great show. Appreciate you taking my call. Question for you. So I have a pretty gifted athlete in the family, and she has the opportunity to play volleyball at the Division I level. And the question really is she's had offers to play in Ivy League schools pretty much throughout the East Coast,

but do we take the route and go to Division I that's not Ivy? Fortunately, I'm in a position where I could afford to send her to an Ivy League college, but do we go and send her somewhere and go for free, or is there a lot of value or is there value in her pursuing that ivy education would she play would she just walk on to the ivy league team or is she an opportunity yeah yeah great question no they um no she would be you know a big big member on the team but it really comes down to I'm in business, I'm a business guy, so is there value in her playing at one of the Ivies

and spending, as a family, probably half a million dollars for that four-year education? Where'd you get that number? Where'd you get half a million dollars? I know. Tell me about it. No, no, no. My world is universities, and that seems like a lot. It's $100,000 a year, at least. Yeah, that's what admissions has told me.

Not like a Cornell or a Brown or a Dartmouth or a Harvard. It's up to $100,000 a year. $100,000 a year. $100,000 a year. Is that tuition, room, board, everything all in? Travel? That's all in. You betcha. Yep.

Okay. I can tell you, let me give you my perspective. I played D1 volleyball on scholarship. I also had that at a couple of different universities. But one of them was also offering me an academic scholarship, a presidential. And the advice that I was given is choose education first, because if for some reason, you know, I go on and I don't want to play overseas or I go on and I decide that I don't want to keep playing volleyball, I'll keep my scholarship, right? Like I don't have to go on

the team scholarship. I can go on the academic side. and so part of this might play out in your situation as well where it's go go the route that serves what the future is so if education and you can afford it if if that's what you're going towards then that's great i don't know what her plans are for volleyball if she's wanting to go on to be an olympic athlete is she wanting to go on to play overseas if that's the case, then D1 might be the route. But if she's got these other, I mean, John, you can speak to the educational side better than I can. Yeah, Mike, it's been several years, man. The last study I read said essentially this.

If, and again, this is before everything blew up and there's been all the drama on all these college campuses before all that stuff. If your kids could get into a Ivy League school and it was not going to put your family out of business, that there was an ROI to them attending. And the ROI weirdly was less about the particular education and more about the people that they would be going to school with. Because those people would leave and start businesses and hire your daughter or your daughter would hire start a business and hire these folks and it's the creme de la creme right the other side of that is um i went to a tiny little naia school and i did all my grads work at a gigantic d1 school and my family's doing all right.

Jade's family's doing all right. And I can't imagine someone with a straight face can look at you and say, pay me $400,000 over the next four years. That just seems out of whack to me. It must've gotten just insane the last 36 or 48 months. But yeah, I have a hard time telling you to go spend half a million dollars when you have it free right in front of you. At the same time,

if I could do it without hurting my family and my kid wants to go to an Ivy League school, I'd probably send him. Let's get bigger numbers. What's your net worth? I don't know. Enough yeah enough i'd rather not get into huge detail but yeah all right tell me tell me what the pause is on your end uh there's really not a you know i just think that uh it's not a huge pause on my end but i do work in the field of business and I didn't go to Ivy. And like

yourself, I think I'm doing okay. And I do know people that did go to Ivy and, um, they're probably not doing as well as, as people who like you and I. So tell me about your kid. Um, uh, you know, I think she wants to probably go into medicine. That would probably be something that she wants to do. So that's why I'm encouraging that direction for her to go to the Ivy. But the offers that she has from non-Ivy are very reputable schools as well. But I know how challenging it is to actually get into an Ivy and to have the ability to use athletics, like I've always told her, to use athletics as a vehicle to do something bigger and better in your life. And this is a prime example of an opportunity that's really hard to pass up. But it's quite a bit of money. And for her, I would do it for her and I would do it for all of my kids. But I just wanted to get your perspective

because you talk about money and deal with scenarios often. So I'll tell you the doctor that saved my life, the doctor that I call regularly and the doctor that I eat with on a regular basis, went to a research, a giant research university. Sure. Yep. And is extraordinary in medicine, is now a professor at a top-tier medical school after practicing medicine for all these years. I think the only patient that continues to nag him to death is me. It sounds like you have an extraordinary daughter who knows hard work, who's also brilliant, who's also learned hard work and work ethic from her dad and learned character from her parents. And to be honest with you, those types of students are going to, you can send her to a local community college and she's going to hit everything, every pitch that comes down the way out of the park. So I think it's, you're, you're one of the rare families that would actually say,

let's talk about fit and let's talk about where your daughter wants to be. Like what group of young people is she going to thrive being around? I think you made a great statement earlier in the conversation about the research as to who is at these schools and sort of like next steps and what happens after graduation and the network because you can't play volleyball forever and you can't play athletics forever um so i think that's sort of the thing that's in the back of my wife and i's mind is like the the value and sort of what will happen and who she can interact with and meet in relationships that can be formed um but i still have a little bit of reservation dude hey you get it i'm telling you right now, I was a dean of students at a law school, at a public law school. Some of the most brilliant, competent, amazing kids of character. They're amazing.

So you can't just lump that into these different places. I'd actually, gosh, I'm thinking out loud here, and I've got no data to back up what I'm saying, but I would almost be more tempted if there was going to be, we're going to go into some sort of AI field, some sort of research field, some side of quantitative, let's go down rabbit hole.

I'd be more likely to send a kid to an IV there than in medicine. I want my kids around gritty, hardworking, let's all study, let's all figure this thing out and serve our communities. And you can find those kids anywhere, anywhere. I don't think you're in the wrong spot welcome back to the ramsey show 888-825-5225 let's go out to

las vegas and talk to luke hey luke what's up brother hey what's going on how you guys doing today we're doing all right. Good man. How can we help? So I'm about to come into a large lump sum of money. I'm not sure the exact number, but seven to eight hundred thousand. Wow. An accident settlement. What kind of accident? And it was one two vehicle accident with me and a semi-truck interstate. Are you okay? I have two pretty serious injuries. I've had a couple surgeries already, and I'm going to need a lot more in the future.

So I want to get your guys' advice on how I can properly manage this money so I don't have to worry about medical bills in the future and set up my family for success. What's the nature of your injuries? Because I know some surgeries that can cost $800,000 without blinking. So I will need at least one spinal surgery where I'll have to fuse two of my vertebrae, and then I'll need at least,

um, two full knee replacements. Oh gosh. Jeez, man. Are you, when will you be able to work? Will you be able to work? What's, what's the prognosis on that? Well, the accident was actually about three years ago. Um, I've been, I've been working for the past year and a half. Me and my wife bring home about $60,000 a year. And we have about, I'm not sure the exact number, but I know we have about $20,000 in debt, most of it tied up with two vehicles and then just some credit cards. Okay. Okay. So the $60,000 a year, is that what you've been making or is that like a decrease in income since the accident? It's actually an increase. And my wife, she's a salesman or saleswoman for her family business selling pools.

Okay. Well, I mean, $700,000 to $800,000 is a lot of money. Obviously, you can do the basic things, clear out your debt, right? You got $20,000 in debt, you pay that off. You make sure you set aside six months of expenses, right? Put that in a high yield savings account. What's the situation with your home? We're currently renting. I spend about a third of my income on just renting. And basically all of what I make just goes to bills and then what

what she makes is uh like food gas and all the other necessities and we're saving as much as we can with whatever's left okay so then that would be the next thing in the equation is to figure out okay what's our what's our dream for a home do we we want to purchase a house anytime soon? If so, what's the price range? Do we want to put a really nice down payment down and invest the rest? Do we want to buy something modest in cash? That's the type of conversation I'd be having if I were you. If we're talking about $800,000, I probably wouldn't want to spend more than, I don't know, $500,000. Hold on a second. Look, I'm going to ask Jade a question on your behalf. Is that cool? Yeah, go ahead. So Jade, I would, man, I'm overly conservative. I want to make sure I clear these surgeries first. I would think, right? Well, what's your insurance like?

I get insurance through my job. They pay for a very actually significant portion of it um the only thing that i really need to worry about when it comes to medical is the high deductible yeah okay great man yeah i mean that's the assumption uh what's your out-of-pocket max is it the same as your deductible uh yeah it's uh 3,500 okay yeah honest amazing and I'd like to get to the point that's why I said I would not uh if you're thinking about getting a house choose a modest amount so you can still have a big chunk of this to invest and if I were you I'd go to ramseysolutions.com smart vester and get with the smart vester that's going to help you invest this. And then I think that you're set up like this is not the type of money that I'm set for life. I never have to do anything. But

if you're smart with it, it really, really, really gives you an amazing jump off. And I think at that point, you just keep doing what you've been doing. You know, you make $60,000 a year. You keep getting raises. You invest 15% every every single month you know you you set aside for your out-of-pocket max every single year and you just keep going this is great in that way i hate that you got in an accident yeah the other thing i would plan for luke is i'm assuming you work hourly as a welder uh yeah so those when you have spinal surgery and when you have two knee replacements you're going to be out of work for a season right for from both knee surgeries uh my doctor said roughly uh six months okay probably so you may want to hold that therapy goes and you may want to hold

that amount of money that you would have potentially earned. And would you put that in high yield savings account? Yeah, I'd maybe do a separate since this is kind of a, this is a outlier. I'd keep your normal three to six months of expenses, six months of expenses. And then kind of like what we would treat if you knew you're getting laid off or something, I'd start stacking up knowing that the six months of no work is coming and put a separate thing there and say, okay, this is for that surgery because you're going to have the ability to do that. And that's, that's one of the things that going into this and saying, whatever, however we choose to live,

let's do it without a payment. That's going to make your life a lot less stressful knowing that you have no debt. You don't owe anybody. Nobody can take your house. Nobody can, that's going to give you a lot of peace all right awesome thank you guys hey we wish you a great recovery brother we wish you uh health and healing my man let's go out to columbus and talk to brianna hey brianna what's up hey how's it going we're doing all right how can how can we help oh just trying to get past my uh graduate my uh degree of dumbness um so i went to that school too oh yes uh so i have i have a question for you based on what do i do with my negative equity um do i pay off my negative equity before or after I take it to CarMax and see how much they'll give it? You're not taking it to CarMax.

That's number one. Tell us more about the car. Tell us what you owe and tell us what it's worth. It is a GMC Terrain. I owe $16,000 worth six to eight. Oh, man. Did you roll negative equity into it? No, I did not.

I have 13% interest rate. Wow. And I've had it for a year. Wow. Okay. The dealership said that they replaced fluids in the transmission and such. When they then told me just like a month ago, that's not the case. I've been dealing with this off and on for over two months.

So is the car falling apart on you? The transfer case went out on it. We got that fixed. The torque converter is starting, which is making the transmission act up. Okay. What a mess. Okay. My husband and I are thinking of just leaving it set. My husband is actually completing a job to give us money for a hoopty for him.

We've spent so much money in the past two years. This is our third vehicle in two years that we've had to drain money into. And the other two were paid off. What other debt do you have? Let's put this in perspective. What other debt do you have? So that terrain, a 2012 Dodge 1500, that's around the same. And then... Wait, when you say around the same, you mean that you owe $16,000 and it's only worth $8,000? No, the truck is worth the payments or the loan is for $16,000. I'm not sure what it's worth. Okay, here's the thing that you need to, here's what we need to talk about when it comes to these cars really quickly before we go. The key here is that we want to be in less debt. So if that means you taking out a small loan from the credit union in order to clear this difference so you can get rid of the vehicle and you're buying the cheapest cash car known to man, that's the only way that you're going to get out

of this. And you've learned a very hard but very valuable lesson to never have a car payment again. You don't want these cars to be any more than 50% your annual salary that's the rule going forward and this is the ramsey show you know one of the first things i discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies and there's too little life insurance or none at all grieving families are suddenly left behind scrambling to pay bills and trying to make ends meet. I also discovered that there are a lot of ripoffs in the life insurance world,

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Zander is the real deal, and that's why they've handled all my personal insurance for over 25 years. I trust them, and you can too. Visit Zander.com for instant online quotes or for a more personal touch. Give them a call at 800-356-4282. Welcome back. This is the Ramsey Show, 888-825-5225. The Ramsey Show question of the day is brought to you by WhyRefi. If you're in default with private student loans, contact YRefi. And obviously, we don't encourage letting your loans get to default. And we also don't encourage everybody to go consolidate everything.

There's a very specific challenge, and it's these private student loans. And we teach responsibility, but these amounts have some of you struggling. And this is a way forward. YRefi was created for people in your very situation. So go to YRefi.com slash Ramsey. That's Y-R-E-F-Y.com slash Ramsey, and this may not be available in all states. Today's question comes from Evie in Massachusetts. She says, I do not feel comfortable sharing finances with my boyfriend, though he's been eager to do so.

He's supposed to contribute to our monthly bills, but it is always a few months behind. His truck and boat payments are set up to auto withdraw from my accounts. At any given time, he owes me around $15,000. This has been going on for five years He works for himself But that work is only really busy for four to six months of the year during which he makes really good money He wants to get married, but I cannot allow myself to be legally tied to him unless he turns everything around I had a recent cancer diagnosis and feel like I need to make a will to protect my assets for my children, and I'm scared to let him know my wishes.

Honestly, he's a good man who loves me and my children more than anything. I love him and trust him. I'm just at the end of my rope with his inability to manage money responsibly. I think in addition to why refi, this question is also brought to you by some sort of hemorrhoid ointment because I have those based off this call. I, this is, there's a delusion going on here.

Yeah. I think the first thing Evie needs to do is go to a mirror and look in it. Um, he does have an inability to manage money and you do too. You've got his truck and his boat payments coming out of auto withdrawing from your accounts you're sharing money with somebody you're not married to and you've got kids from i'm assuming a previous marriage my my and y'all are all tangled up in this mess with no legal protection and it's an absolute wreck and by the way if you quote unquote love him and trust him your body wouldn't be screaming at you to not have this level of vulnerability

and openness with him there's something else here i think you want to love him and you want to trust him and he's not proving trustworthy and you're finding yourself in a situation that you don't want to be in jade these things like it just it's like by degrees right yeah and you wake up and you are completely underwater and you can't you can't swim you can't breathe and you're chained to the bottom of the pool and you don't even know how it happened and it's just easy to blame somebody else but wow wow wow wow i mean i feel like just looking at i mean obviously we could point out the obvious things like you said you're not married and you're sharing finances everything's coming out like

there's some things that are very obvious but then there's like listen this guy only works six months out of the year he only makes work six months out of the year but i'm like the track record doesn't no the financial track record is terrible if you're saying it's been like this for five years yeah that for me and i i'm not the expert here, but I'm like, that feels, that's tantamount to just using you. That feels, that's the way it feels. I'm only getting that from this, you know, one letter here, but that. Let me say this, behavior is a language. And he's told you for five years, I don't care what you think.

I don't care what you feel. I don't care about your kids. I care about working really hard for a couple of months out of the year, half the year. I care about my truck and I care about my boat. And let's get married. Right? Like you said it best. He cares about himself.

And at the end of the day, Evie's got to care about Evie. Well, what would cause her and so many of us to get comfortable with a situation that's clearly so dysfunctional? Again, like it happens by degrees. I think it can be that we so badly want, and sometimes we feel like we need a situation, a job, a marriage, a relationship to work, because we can't see

ourselves on the other side of that, that we just wash over all the negativity. Other times it happens, like I say, it happens just one inch at a time. He comes home and he bought a truck and he auto-drafted out of your account. He says, hey, can we do this on your account? We're just going to put it all in the account. That big check's coming next month and it'll be fine. And that check doesn't come next month. And then he's like, he gets a boat and it's fun for the kids.

And suddenly you wake up and it's been five years and you realize, oh, I'm building a life with somebody that I don't trust, that doesn't work, that doesn't tell me the truth. And I don't know how to untangle this. And the easiest way to untangle things is just to start pointing fingers at other people. And really the first place you got to go is the mirror. When you find yourself all wound up, you got to go to the mirror first. So what then, what would we say are action steps for her?

Because she wrote us a letter. She's like, I'm at the end of my rope. I don't, she thinks it's just a money thing. We know it's far beyond that. So what's the action steps? I think action step number one is to sit down and say from this point forward, I'm not auto-drafting stuff out of my account. I have to protect me and my children. Yeah. So your stuff

goes to your account. So we separate the funds. That's numero uno. That's number one. Number two, if you're not going to contribute financially, you're not living in this home. And that's a bigger question, which is you keep asking me to get get married you want to build this life and you are not showing me on a day-to-day basis that that's the world you want to create um and i can't like she's trying to she's trying to she's thinking logically about like i got to protect my family she's just doing it in a sideways way which i need to make a will to protect my assets no you need to stop letting somebody else just take money out of your account it's almost like she's thinking through a marriage lens of hey we're sharing our money we're making a will uh if i'm sick he's taking care of my kid but they don't have that institution in place

to protect them yeah right and she doesn't she's not doesn't have a person that she trusts or is a person of integrity that's doing this with her right so i would begin to say what can i control out of the situation i can control my bank account i can control what money comes out of my account i can control whether i'm going to continue to play house for five years with somebody that i don't trust and that doesn't work even year round i mean those are the hard hard conversations and by just looking at this i think we all know what that means yeah well big red flag is i'm scared to let him know my wishes. That's it. And if you are with somebody for five years and you can't sit across the table and be honest and vulnerable and open, that person's not for you.

That's a tough situation that you find yourself in. So, Evie, I'd call somebody who can walk through this with you because it's a tangled mess. This is like a whiplash on a on an open-faced fishing reel man this is hard to just untangle all by yourself and so get somebody with you and walk alongside you and um at the end of the day you're worth more than this mess that y'all have created together and we wish you peace in your relationships let's go out to san antonio and talk to uh jesus what's up jesus I'm up against the clock, so get right to your question, all right? I got you right now.

Thank you guys for taking my call. You got it. What's up? My car just broke down. I still owe $6,000 on a car loan, and I have $13,000 in student loans. I've done my first baby steps. I saved $1,000 of an emergency fund. I paid my credit cards off, and I currently have a job that makes $87,000 a year.

Apart from the need for a car, I just don't know how to save. And as silly as it sounds, I just started listening to the Ramsey show. So my mind is changing on how to use money. I guess my biggest question is what's my action step, my next action step? I mean, so you've got the $6,000 car, but it's broken down right now? Correct. How much is it going to cost to fix it? But maybe 3K. Okay's that's a lot for a six thousand dollar car have you been putting that kind of money into it a lot lately no not at all not at all okay then we're getting it fixed that's for i mean you got to be able to get around so how quickly could you if you temporarily like pause the baby steps

right quick how quickly could you get that money together to get this car fixed car fixed i have it already oh i have it already but i was going to question so i already asked i've already been approved by my bank with the $25,000 loan no no no no you just told me the car was broken down and it cost $3,000 to get it fixed fix it the goal is the goal is to get out of debt brother not. Not get more debt. Get to zero. Yeah. John makes a good point. If you don't hear anything else from this call, you can't solve a problem while simultaneously creating it. Debt is your problem.

If you keep borrowing money, you're going to continue to be in debt. So you've got to draw a line in the sand. You say, I'm not borrowing money anymore from this point forward. Spend $3,000, get your car fixed, and then it's on to baby step two. You list the debts out from smallest to largest so the car comes first. You put as much money as you can to that debt till you pay it off. Then you attack the student loan. That's it. All you can do is add side hustles to this to make it happen faster. That's it for hour one here on The Ramsey Show. We'll be right back. Hope to see you soon. Live from the headquarters of Ramsey Solutions,

it's The Ramsey Show. I'm John Deloney, joined by Jade Warshaw. We're here to help you with your money, your relationships, your mental and emotional health, your work, whatever you got going on in your life. We've got an opinion, and it's going to be worth about what you pay for it, which is nothing, but give us a buzz at 888-825-5225. We are live. Let's go out to Laredo, Texas, and talk to Joshua. Hey, Joshua, what's up, man? Hi, Dr. John Deloney and Jay Walsh. I'm fanboying so crazy right now I can't believe I'm talking to you guys.

Dude, we're fanboying too. It's great to hear from you. What's up? Well, I'm just having a lot of trouble with how to emotionally and how to deal with my mother and my wife's relationship and my mother's relationship with my sons. What's going on? Yeah, what happened, man?

I just feel like my mom could do a lot more for her own grandkids and to be able to fix a relationship with my wife. What happened between her and your wife? So whenever my wife and I started our high school sweetheart pretty much, and my mom didn't like me going out with her. And then when I went to go ask for her hand she said that she didn't want me to marry her because she thought her family was going to take advantage of me

I asked her why and I honestly don't remember what she said and then now that we have kids my wife feels like she could do a lot more of a grandma and I feel the same way too how have your conversations been with your mom? Have you brought it up to her? I brought it up to her before and she says that, that cause at first my wife sees,

would see favoritism between my oldest and my youngest and my wife. Josh, I don't want you to offload this on your wife. I want you to take responsibility for this on this phone call with me what are you experiencing with your mom is she treating you and your kids and your wife differently I feel like she

just let's don't traffic in feels right this second feels are important but not right now is she treating everybody differently I don't think she's always done. Let's don't traffic in feels right this second. Feels are important, but not right now. Is she treating everybody differently? Not out of her character. She's just like that. I don't know what that means.

Why? I just, she always helps out everybody else before herself and her, her own family. That's what I feel. Okay. And have you sat down and said, Hey mom, um, I would love for you to be more involved in our family. And here's a couple of ways that you could do that. No, not, not like that. Not necessarily.

Okay. no not not like that not necessarily okay i think at some point you have you as her son don't pawn this off on your wife but you as her son sit down with mom and say mom um i have this picture of you as grandma of our little ones and you've been our ride or die and i would love for you to show up in these ways, and then I'm going to list these, pick them up, kids up from school, show up after school, come be with us, go to holidays, do Sunday lunches after church, or whatever the things are,

instead of this amorphous, well, I think that this, and I feel this, you see what I'm saying? Let's make this pretty specific and give your mom a chance to show up in the ways that you guys would like to see her show up, or the hard part of this relationship is she might not that's very true i think that if you have expectations it's unfair to at least not communicate them and then they're just a bad guy and they don't necessarily know why but at least if you said here's here's what i thought

it was going to look like or here's what I thought it was gonna look like or here's what, you know, and some of it may be fair, some of it may be unfair, but at least you're talking about it. Then at least she has a chance to say, okay, now she can do with this whatever she will. And if she decides,

yeah, your expectation is different than what I thought I was gonna do, then at least you can kind of put the situation to bed as opposed to having this continuously like unmet expectation that you never talk about. That feels... It's just kind of cruel because your mom doesn't know what standard to live up to. And here's the other deal, Josh. Does your wife know that your mom didn't want y'all to get married?

Yes, she knows. And my wife doesn't feel comfortable with her anymore because of a lot of stuff that has happened in the past, and that's another major issue. Well, like that one time that I told you we were going to get engaged, my mom said that she thought her family was going to take advantage of me, and then she would talk about her parents really bad because she would be hanging out at the house pretty late, and we weren't doing anything bad it's just that she thought that it was that her parents were bad

parents and stuff like that what made her think that is there something specific is it a is it a financial thing is there more to that no not not that i can think of i don't know i mean we were just teenagers and we were just hanging out how old are you at home i'm 26 years old how long are we going to hang on to that mom said some dumb rude things about your girlfriend's parents when y'all were dating however many years ago now y'all have kids like the situation's changed. Is she still hanging on to that or is it you guys hanging on to that? I think it's us.

Every time your wife comes in, does she look at him and go, oh my gosh, I can't believe you married her. Her parents and family are disgusting. They're taking advantage of you. Does she still talk like that? No, she just keeps quiet. Okay. Maybe she's ashamed of what she said about you guys when you were dating,

and now your wife's turned out to be a pretty amazing woman and a good mother to your kids and a good co-creator of the world y'all are creating together, and she doesn't know how to reenter that conversation. Who knows? My guess is your mom saw her little boy date and fall on head over heels for some girl and she didn't know how to say you're my baby boy i don't want you dating anybody and she just ran her mouth

is there some is there is that a possibility yes that is a possibility okay have your wife's parents taken advantage of you? No. Okay. So I think that the time now is to stop wishing your mom would live up to a standard that you guys are kind of, it's kind of amorphous. And I think it's time to let things that were said when you all were teenagers go. And let's sit down with mom and say, we miss you and we want you in our life in this way. And I know that you didn't want me to marry her. I did. We've got a family and we want you to be a part of it.

You get to choose. Because I really don't, I mean, Jade, tell me if I'm crazy. I don't know another option, Josh, than just to sit here and have these weird feelings. And your wife's going to have to forgive. Am I crazy? No, no, no, no. I think also like I would never like also as growing up I would never defend my wife and certain things that would happen with my family the way they would treat her. Now I'm realizing what I've been doing wrong and I'm trying to

change that and putting boundaries so I think maybe that could be a thing why they would react a certain way. And you're also allowed to say, nobody is allowed to talk about my wife that way. And if y'all choose to talk about my wife that way, then y'all are choosing for me to leave because I'm going to walk out the door and my family's coming with me. I hope you will choose not to do that and apologize. Take your wife wives by both hands and look her in the eye or hold her face and look at her eye and say, I did not stick up for you when I was a kid and I'm sorry. And I let things go and I shouldn't have, and I'm really sorry. But a lot of what you're talking about sounds like y'all are trafficking in the past and you've got two kids, you're 26

years old, you're a grown man, you're creating a life together. And if you want your family with it, you got to give them a chance to step up. Does that sound right, Jade? 100%. All right, let's live moving forward, man, and give your family a chance to step up or to step out. This is The Ramsey Show. There's a time in your life and at the baby steps for renting, but you don't want to do it forever because when you rent, you're still paying for a mortgage, just somebody else's. Plus, rent means instability in your budget

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Equal housing lender. 1749 Mallory Lane, Suite 100. Brentwood, Tennessee 37027. Welcome back to The Ramsey Show. I'm John Deloney, joined by Jade Warshaw. Hey, take a quick minute, not a minute, take a quick 10 seconds, and wherever you happen to be listening or watching the show, please hit the subscribe button or the like button. Leave a five-star review. It just makes such a difference. It kicks the show up into algorithms,

and it puts this important information in front of millions and millions of people who otherwise never would have seen it. And all of us are worried, and all of us are looking around saying, hey, what we're doing is not working, but nobody has a light in the darkness. And that's what this show is. It's totally countercultural. Don't owe anybody anything. Live free.

Let your families go through life with peace inside your home. And man, just a quick like and subscribe can help get that information and that spirit into so many more homes. So thank you so much for doing that for us and for your neighbors, for you. Let's go out to Pittsburgh and talk to Tyler talk to tyler hey tyler what's up brother hey tyler hey i'm doing good how are you

that's you man i'm john good to see you i can't see you good to talk to you how about that let's just start the whole thing over hey tyler hey how you doing john great great what's up hey nothing much so i'm looking to purchase a mclaren 600 lt spider uh the car is well that's just a couple hundred grand good for you thank you thank you but it's probably going to be the biggest purchase of my life next to the house that I live in. Can I tell you something hilarious? I'm currently negotiating with James Childs over like a 98 4Runner. Like literally, he just stuck his head in to talk about it. So go ahead with your McLaren purchase, Tyler. So really, I mean, I'm just looking for some professional advice here on the purchase, because obviously it's a pretty hefty price tag. I think I'm in a good financial position to afford the car. What's the cost? I wanted to turn to some experts. The cost is $223,000. Wow. Wow. I just don't even

know how to act. Okay, cool. I'm going to act really nonchalant. Cool. Okay, cool. What's your net worth? It's around $1.4 million right now. Nice. Okay. Looking good. Let's find out, are you paying cash for the car? I can, but I know that there's also benefits with a leasing structure. I own a small tech company, so I also am earning about 5.3% right now on my high yield interest savings account so if I should leave some money in there or if I should pay cash for the car

I mean if you're calling us the only way I would get this car is if you paid cash for it because you can afford it and it's done and done I'm assuming that you don't have any other debt laying around that would change my mind here uh i've got fifteen thousand dollars on another auto loan but that's locked in at 3.5 right now and since my savings account is earning more than that

did you say you have a fifteen thousand dollar loan laying around i do why you you could be totally free i could be totally free and i know that that's what you're big on the big reason why i'm not is because it's locked in at 3.5 but it'd be locked in at zero it'd be locked in have you factored in the depreciation you're losing money. Because you're taking a 5% count against your 3 point whatever it is. But your car is going down in value. Right.

And so your calculation, you think you're winning and you're not. And you're saying based on depreciation only. I'm saying, number one, you're not because there's a psychology to this, and I know that nobody wants to factor that in. But part two is, yeah, the car is worth less money every day you drive it, and you keep saying you're locked in, and I keep going, yeah, that's the problem. You're locked in. No matter what happens to your finances, no matter what this car bottoms out out at you're still paying that same amount of money across the board dude i'm just telling you what

i do in my house i would pay it off right this second you're a millionaire you have a $50,000 car what are you doing well let's keep talking because i want to know more i want to know what's your income every year so i'm on salary with my company for about 110 a year and then i pull a bonus that's between about 90 and 120 a year okay and how well we do okay so that puts you at about 200 000 a year it's not looking good i'm just letting you know right now tyler it's not looking good for you let's keep let's keep rolling out the numbers. Tell us about your home. So it's a lakefront condo. I visit in Cleveland with some family. It's fully owned and it's about $300,000 is the appraised value.

That's what it's worth and it's fully owned. What other properties? Do you have any other properties that have mortgages? Nope, nope. It's fully owned. That's the only property. Okay, so it's really just this fifteen thousand dollar car and then between the the property and your other investments you're at

1.4 million net worth but your income is 200 000 yeah you could say 200 yep and i'm maxing out the 401k maxing out the ira so money and savings i think you're doing really really really really really really well but here's just a couple of rule of thumbs i have a feeling that you're doing really, really, really, really, really, really well. But here's just a couple of rule of thumbs. I have a feeling that you're going to go and do what you want to do. But let me just give you some just food for thought here. Typically, we would say if you are a net, you know, if you're a baby steps millionaire, your net worth is a million dollars or more. You have the ability to buy a brand new vehicle outright.

Like at that point, you've done well enough that if you spend the right amount, you should be able to put that money in a pile and burn it to the ground and your heart rate shouldn't change. Right. But then there's another parameter to that where we say, OK, but it shouldn't be any more than half of your annual salary. And if you do this McLaren, you are at more than your annual salary. So if you said, hey, I want to buy a $100,000 car outright, or I want to buy, you know, even if you said it was like $105,000 or $120,000, I'd probably be like, yeah, let's do it. But I really do think because of your annual salary, I think that this is too much car for you. I think if we took that $223 and I, you know, did a Wile E. Coyote and I put some dynamite on it and blew it up in the middle of the desert,

I think that you would start sweating. Yeah, I know what you mean. You're right, absolutely. So I don't think it's... I respect the opinion. I mean, it's my opinion and it is mine, but I don't think you're quite... I wouldn't do it if I were in your shoes.

Can I ask you, like if somebody called and they made 60 grand a year and they they had a paid for a condo and they said they wanted to buy a 60 000 car i would say please don't do that because you're putting yourself you're putting yourself at a pretty significant financial risk what is it about this 200 and a quarter of a million dollar car what is it about this car that250 million car that's got you by the guts? And I think that's going to be the game-changing question, hopefully, is that they only made 345 of these cars. They're an extremely limited production, so it's rare, and it's pretty much being considered a collector's item at this point. And I think it will maintain its value, if not appreciate, over time. Because obviously cars of this caliber are depreciating rocks most of the time. Is it a P1?

There's no denying that. No, that would be a million-dollar car, man. I wish. Okay, which one do you have? Because I'm just doing a cursory look here and it said outside of the p1 mclarens are losing 30 of their they depreciate pretty quick you know what i won't argue with you you know when i drive i drive an old truck so you i'm clearly biased um i'm clearly biased here like i just i just don't put money depreciating assets if you think it will go up i just can't imagine spending a whole year salary well there's a part of this scale though let's be honest there's let's go back to that you know half of your yearly salary there is a part of that equation

that if your net worth were a certain amount i'd probably i'd throw that i jade would throw that out the window um so you can hold me to that. I don't, at 1.4, and knowing that if you were pulling out of this investment to make that happen and make you go down to 1.2, I just don't feel comfortable with that. If you had called me and said,

hey, my net worth is even 3 million, I might be like, oh, okay. Yeah, all right. Or what's your cash position, bro? How much cash do you have in the bank? In the bank right now, I've got about $350,000. And that's aside from the $1.4 million? That's a part of the $1.4.

A large part of the $1.4 is obviously the condo that I own and then the EBITDA. Yeah. I'm the sole owner. If I'm you, if I walk up in your shoes and I loved cars the way you did, I feel like it's too soon. I'm still sticking to that 50% rule. If my net worth were higher, I'd probably reconsider. So do with that what you will. I'm going to try to convince you to get a nice new Highlander.

Stop. He's not getting a Highlander, John. Get a Highlander. I'm not even getting a Highlander. Stop. He's not getting a Highlander, John. Get a Highlander. I'm not even getting a Highlander, John. Welcome back to the Ramsey Show. And right here in Nashville on the debt-free stage, right inside Ramsey Solutions headquarters, Jay and Yvette are here from Raleigh, North Carolina. How much have you guys paid off? We have

paid $91,168.80 in student loan debt. A student loan debt? Yes. Let's go. Not that we're counting each penny. I was. Wow. How long did that take? It took us about nine months.

Nine months? Okay. All right. Tell me that story. So about a decade ago, my brother gave me this year, Ramsey book. So I opened it up. It took me a few years. I'm a little bit hardheaded sometimes. So it took me a few years and I opened it back up, got my budget sorted out a little bit better. Once we got married in December 17, 2022, my wife and I sat down. We had a financial and planning meeting in which we laid out the plan for our next so many years, five years or so financially what we wanted to do and what kind of life we want to have for uh and how we're going to serve serve god and so

we looked at we laid out what was it three years worth of debt repayment that we was going to take and we didn't want to put life on hold just so that we can pay off debt for years and years and years and get off and stay on that treadmill. So basically we sat down, had the meeting, had a, had a planning session and I had laid out, uh, this it'll take us maybe a year, year and a half if we make sacrifices. So what were you making? Cause you did this in nine months. Yes. So when we first started out, we were making about $125,000 between the two of us. Okay. I am a registered nurse and my husband is a technical engineer with Cisco. Okay. So then once we finished the plan and

we realized where we need to increase our income, if we want to do this in less than three years, which is what we calculated it would take us to do if we stayed with the current income. So then as a registered nurse, I had some options on what I could do. So we talked it over and we're like, okay, let's do travel nursing. So we looked into it. He's the numbers guys. He lays out the budget and he looks into them. We research, we look to see what areas and what each region of the country we country were paying so we decided to move to missouri st louis missouri for about a year and then there increased our income drastically i would say and that's the reason it took us nine months so what'd you increase it to between the two of us ended up being about two a little over two hundred thousand dollars holy crap yeah wow

that's amazing so you dropped it from nine months from three years to nine months correct and that took though it meant what y'all did we talk about this off air a lot just like man somebody calls and they say hey i want to live in manhattan i want to be a book editor i want to pay off 100 grand of student loans and we always say man one of those variables has to give and y'all said we are going to make a one-year sacrifice living in a town with a community people we don't know a place we don't know but we researched it here's where we can get the most ahead the most bang for our buck right the lowest cost of living plus the highest return and i'm assuming jay you can work from anywhere work from home that's amazing and y'all just move somewhere

y'all still live there have y'all now moved we are on our way home actually come on i love that just hold on. We're going home. So the book you're holding is the total money makeover. What caught, tell me what was the, the light bulb moment? Like what made you go?

You know what? Yes. This guy knows what he's talking about. I'd say over, over years of listening to the, to the program on the radio, it takes a while for it to sink in. It's not a distinct

moment. And that's the same as any kind of journey you're on. It takes some time for things to sink in. Same for you, Yvette? I would say just looking at it and just like three years is a long time. And we had just gotten married. And of course, I want to have a baby. I'm like, three years is a long time. We both agreed that we would wait to get out of debt before we started family planning. So I'm like, three years or cut it down to a year if we move and just, you know, do what needs to be done for a year. Again, make that sacrifice for a temporary sacrifice to get a long-term goal going. It's not sustainable if you're planning on doing it for years and years and years. But Gazelle Mode is designed so that you can do it in a short period that's right wow so tell us what it's like you

know paint us a picture of what it felt like before you got a hold of you know total money makeover and ramsey principles and then paint us a picture of what your life feels like as any man trying to leave lead a family you have a lot of pressure on your shoulders and so you don't want to be not able to provide for your family. And ultimately having a system that both tells you, yeah, there's a lot of scary things out there, but you have a way to deal with it. A system that works that's biblically based that you can actually apply. And you know, you're even if it fails, you're still trying your best. That's, that's, that's what mattered to me. But what it's, what's important as well is

that it did not fail we're here that's right hey Yvette can you speak to those who are out there they are in love with somebody who loves himself a spreadsheet and they don't and they have dream I know I can see it and they have dreams what they want their life to be. And if it wasn't for that spreadsheet-loving friend of theirs or marriage partner of theirs, they would just go on about their life. There can be some shame there. There can be some, oh, I brought this dead into this marriage. There can be that heaviness, right?

And it sounds like you, yep, here it is. It's on a table. And there's a lightness about you that was like yep i did and we're gonna go make this right and we're gonna get on about our lives what would you say to that person who doesn't want it on the table doesn't want to talk about it is carrying that well this is my dad i brought this into the marriage or this whatever relationship i'm in what would you say to that person for me first of all i didn't really feel the burden that i brought the debt into the marriage

because it was very clear that okay this is ours now before we got married through counseling we just yeah we decided that we were going to put our things together and become one so i didn't really have any burden on that in that regard i love that however as far as bringing things into the table when he brought it over we had probably a two hour long business meeting that for me and i was just like i need a break can i get a little bit of a break after five minutes like do it in fragments for me that was one of the greatest two hours of jay's life yes for me but after that meeting and once i saw the numbers and it made sense i was like okay let's do what we need to do and And the most important things out

of all of this is the fact that we came under one unified plan. I saw the plan. I agreed with the plan. I knew what it would take to put that plan into action, but I also saw the work that he put into it and that together we could do it. So it was just selling me on that. Together we can do it. Together we can do it. So we do it so we agreed we unified ourselves and we did it it took six months after we were married before we actually did the travel nursing so it was not forcing it on her to to up and leave i can't put that on my wife that's not that's not wouldn't be fair sure so it took six months so once late we laid it out and then we saw the numbers six months later it wasn't like hey we're married we're jumping

right and doing it good for you guys so who is your biggest champions uh through this time i would say our families they've been through the journey with us just kind of like hearing like sorry guys we can't do this we're getting out of debt i'm sorry we can't we can't do this weekend we're trying to get out of debt so for they were very patient with us just understanding as well just like hey i'm sorry this got a little too much and of course the budget we we stuck with the budget and even with us if there's something that needs to be that we need to buy or want to buy rather it's just like where's the money coming from i'm the spender so she keeps me alive a little bit oh you're you're the spender, Jeff? Which is weird, right? Yeah, the nerd is the spender. Interesting.

But we have a question. Yes, we have a question. All right. Is it in the budget? There you go. There you go. Well, Jay and Yvette paid off $91,000. Say the number again.

I'll let you say it. $91,168.80. In nine months, you packed up up you moved across the country y'all made a whole bunch of sacrifices and you knocked this out because you've got bigger dreams ahead we're so proud of you thank you come down to it count it down let's hear your debt free scream scream. We're dead free! Amazing. Amazing. Wow. So Jade.

You know when they count one, two, three, it's going to hit different than when they count three, two, one. Yeah, dude. We talk about this all the time. It's almost always how fast you get out. Like, what kind of sacrifices are you willing to make? Will you move? Will you sell everything? Will you take new jobs?

Will you just get super, super uncomfortable? So, and I love the way you said it, so we can get on with the rest of our life. Yeah. I love it. I love it. I love it. If you are listening out there in radio land or podcast land, this could be you too. This could be you too. We are rooting for you and we're here with you. We'll be right back on The Ramsey Show.

Welcome back to The Ramsey Show. I'm John Deloney, joined by Jade Warshaw, 888-825-5225. That's 888-825-5225. All right, we are heading into the fall, and it's time. It's time. Those of you out there who went B-A-N-A-N-A-S with your money this summer, going to every summer camp

and sending your kids to every whatever, traveling, we'll just pay for it later well later is here so this fall let's get your money in the right place i want you to join rachel cruz and the every dollar team for free live training free live training on wednesday august 28th at 1 eastern time 12 central to help you get clarity with your money You can register for free at www.everydollar.com slash webinar. And I have heard if you say www, it means you're 100 years old. Go to everydollar.com slash webinar. Over 100,000 people have registered for this free live training in the past,

and now it's your turn. The number one way to eliminate debt is to budget. The number one way to build wealth is to budget. And the number one way to get on the same page with your spouse about money is to budget. The number one way to eliminate stress in your financial life, you got it, is to budget. It's time. You know it's time. No shame. Let's just sit down and get this stuff squared away every dollar.com slash webinar august 28th free with rachel cruz let's go out to the 505 albuquerque new mexico and talk to esmeralda hey esmeralda what's up hey guys uh you know i just had a question um i'm right now engaged uh been with my my fiance for five years and um five years tell him to let's go i know we're kind of not in a rush we'd like to get all our debt and uh

every all our baggage out of the way before we kind of tie the knot why why trust me you're gonna bring plenty of baggage into this marriage both he was married before and and got out of the divorce um some debt and i guess he just kind of wanted to start fresh uh in in this new venture oh so you're saying he wants to clean up his debt before marrying you is that it i i believe so yes how do you feel about that it? I believe so. Yes. How do you feel about that? Are you fine to jump into it together? You know, I've been supportive 100% of the way and I'm ready to get our life started. But I do understand where he's coming from. What's the debt? How much is it? So I think he's about $25,000, $30,000 in the hole right now. And I have a little bit of debt myself.

How much? I have about $40,000. Uh-huh. $35,000 is my car and $10,000 in, I guess, personal loans and credit cards. Did you know that you can go further, faster together? You know, I've been listening to Ramsey and everybody on the Ramsey Network for about a couple of months now, and I'm really kind of just trying to get everything in control, and I really want to get debt-free, and I want to jump into this.

I'm ready. Yeah, I think you tell him that. Getting him on track with me. Yeah, I think that's the conversation you need to have because it's one thing to not be in a rush, but five years is like a snail's pace. It's like a snail passed you. It's pretty slow.

Yeah, it's crazy how the time has passed. Listen, and this is not just for you. This is for anybody listening. Debt is not a reason to postpone your life together. If you're with the person that you know you want to marry, debt is not a reason to postpone that. Work together. Pay it off together.

Get married. I know a lot of people call in and they say, well, as soon as I get myself together, then call in and they say well as soon as i get myself together then we'll you know as soon as i pay off my debt then we'll and i'm like uh i've been with the same person for like 45 years i'm still getting myself together i got a long way to go so you're gonna figure it out the bigger conversation is that you're on the same page about money do you see what i'm saying it's not about about, hey, I have $50,000. Let me clean it up. She has $70,000. Let her clean it up. Because you could both clean up your debt, but if the behavior hasn't changed, that same person is going to go back into $50,000 or $70,000

of debt. So the most important thing is, if you want to get your, quote, get yourself together before getting married, then decide what your views are on money and debt going forward. So that's the only thing that you need to get on lock, you know, financially beforehand. So I'd be asking him, I'd be saying, listen, we both have debt. You know, we both had lives before we met each other. We both made mistakes.

Okay, how do you feel going forward? Because I've been listening to this Ramsey thing and maybe don't even say that first. Just say, let him say what his views are. And then you go, okay, got it. And then you say, well, if they're opposing, say, well, I've been listening to this, you know, Ramsey Network, and I really don't want to mess with debt anymore. I really want it out of my life.

I know that we have plans to clean up our debt, but I don't even want to go into debt anymore after that. And those are the things you need to be talking about. And I really want to build wealth. And I really want to be one of those people that invests, you know, 15% of their money into their 401k. Like those are the things that you need to be talking about. Not paying off your debt before you say I do. So we've been really good about putting into our 401k, getting things set up. We're doing really well in that aspect. It's just kind of, I guess,

taking control of the little bits of debt that we have outside of that. Once it leaves the account and goes directly into the 401k, it doesn't bother us. It's having to pay it is, I think, what kind of scares him. And he says sometimes he doesn't like to look at his bank account and see how much money he has, and he's kind of nervous about that. So I thought about maybe combining our bank accounts. No, no, no, no, no. No. As the great Beyonce said, not until he puts a ring on it.

No, no, no. Oh, she also said, no, no, no, no, no. That's right. Dude. Okay. As Merelda, no, do puts a ring on it. No, no, no. Oh, she also said, no, no, no, no, no. That's right. Dude. Okay. Esmeralda, no. Do not combine your bank accounts. Yeah, don't do that.

What you're trying to do is fix his problem by taking control of it yourself. If his problem is he's an ostrich and he's burying his head in the sand, he needs to be a big boy and come up and go, no, I've got to look at this with both eyes wide open, see what it is. If you say, oh, you're afraid to look at it, I'll just put it in my account and I'll just do it for you that is something that you definitely don't want to start uh here's what I want to walk through with you and before you get off the line we're going to give you um Financial Peace University I think you and him need to go through it together um and let us teach you all the

parameters around this because even you talking Esmeralda, I can tell that you're wanting to do the right thing, but you're doing a lot of the right things in the wrong order and it's going to cause you to go slower. So it's going to walk through the baby steps. I've tried the EveryDollar app too and I haven't really gotten all the use out of it

that I know I can, but I kind of need him to be on the same page with me as well. That's true, but you do. But right now, you guys are doing your money separately. And he won't marry you right now, so you've got to take care of you. You can't keep waiting around for him. Yeah, you really can't because you might also find right now,

in the financial side of things, I've heard nothing but yellow and red flags. Okay. So you guys get to deal with those, but I want Esmeralda to come away from here and know, okay, I know what I'm doing. I'm walking these seven baby steps. The first one is I'm getting a thousand dollars saved. And if I have more money saved beyond that, then I'm going to throw it at baby step two, which is I'm paying off all of my consumer debt, everything except my mortgage. And I'm not investing, by the way, until I do that, because I need that money to pay off this $40,000 of debt. And then you're going to save up Esmeralda three to six months of expenses,

your expenses, what it costs to live your life and do your budget. And then Esmeralda, after you've done that, then you would begin investing 15% of your income every single month. That is your gross amount. The amount before taxes is what I want you putting away. And so I want you to focus on those first four baby steps on your own until this guy decides that he wants to put a ring on it. And Esmeralda, I think you can be okay sitting down saying, I want to do the rest of my life with you. I'm ready. And Jada, it always feels like an excuse to me yeah it always feels like well whenever this happens and then whenever this happens it's only twenty five

thousand dollars a day he should have been had that paid off i know it esmeralda probably sell your car we could dig in that on another call but probably sell your car most of yours is is that is that vehicle i'm just saying him if that was the problem, it's $25,000. Bro. For all of you listening to the show on YouTube or podcast, it's about to end, but more calls are coming up in the Ramsey Network mobile app. The Ramsey Network app is the only place to finish

full episodes of the radio The Ramsey Show. If you're listening to this on the radio, stay right where you are. We're going to continue. Two ways to get the free app. Click the link in the show notes or search Ramsey Network in the App Store or Google Play. Don't miss what's coming up next. Go finish the show in the app for completely free. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people with their money, their relationships, with their mental and emotional health,

their work, pretty much everything. I'm John Deloney, joined by my good friend Jade Warshaw, and we're taking your calls live at 888-825-5225. That's 888-825-5225. And the great James Child asked me to do it in Portuguese. Obrigado! Obrigado! Let's go out to Washington, D.C. and talk

to Jeffrey. What's up, Jeffrey? Hey, good afternoon. Thanks for taking my call. You got it, brother. What's up? I was hoping to float some ideas to you. You could tell me how bad they are. That's one of my spiritual gifts. I like this. I like this a lot. Continue, Jeffrey. Okay. So I am debt-free and I am building wealth.

No car payments, no student loans. The only debt we have is the mortgage. There's about $200,000 left on the mortgage at 2.5%. Okay. And I'm prepaying that down, hoping to be done within the next five to 10 years. Okay. So here's my dilemma. My dilemma is this, that I'm trying to solve a housing problem. My wife and I have seven children

and we homeschool them. And the house we are in is 2,000 square feet on on the on the first floor and 800 feet on the in a loft the problem is it feels very tight very cramped especially in the dining room where she does most of the most of the schooling okay okay yeah this is where you tell me how much you want to go into debt to fix it yeah and this is why i just tell you hey jeff that's exactly what i'm about hey jeff just don't just don't that's all tell us more tell us tell us what you want to what the loan you want to do jeffrey so what i guess there's kind of a conflict of interest here

because it would be possible to to save up to save up money to do it however she doesn't she doesn't want to wait she says this needs to be done now all right and so i have that's the story brother you don't want to and she does now we're into it okay what does she want to do i've somewhat i've somewhat foolishly opened the door to saying okay look you know if we could i know i know you're gonna you're gonna tell me this is a bad idea. Like what if we, what if we try to access some of the houses equity through HELOC and fund, fund the renovations that way, or perhaps we could take out a personal loan to do that. And so we looked at a couple possible plans. The total price tag for this is going to come to between 50 to a hundred thousand dollars.

Please don't do this. I beg of you not to do this thing. Don't put your house, the house that you have with seven children and your wife, there's nine of you. Don't put that home on the block. I don't want to do it either. I'm simply trying to find at least something to say, okay, I'm willing to consider this. This is not my first choice, but I'm also wondering if even a personal loan is a good idea either. No, I'd rather you contact the church that you go to and ask if y'all could rent out two rooms because y'all homeschool. I was just about to say that, John. Or somewhere, because here's the deal. Y'all have made choices about how you

want to live your life great the problem is and and and i make choices my wife makes choices jade and and sam made choices we all make choices math doesn't care about our choices and it just on if you think of risk as a teeter-totter you just get further and further out on that fulcrum. And at some point, something drops from the sky, like any number of like 2008, 2009, like the AI over evaluation that's going to hit. And that's just me. The COVID, whatever it is, something always smashes the other side of that teeter totter and sends everybody who's leveraged to the moon. And I get, good God almighty i get how how you're out on an island right now you got seven exhausted kids you got a wife that's exhausted you come home from work and they're all looking at you all haggard i get it man and she's like get me out of

here um i totally get it well she doesn't want to leave. That's the thing. I know. I know. I think to John's point, now's the time when you choose this lifestyle, it causes you to become more creative. And so for you guys, don't paint yourselves into a corner and say the only way we get what we want is if we go into debt. That's a recipe for disaster. You've got to help me just, I'm sorry, help me, help me just because this is exactly what I say. What you're telling me right now is exactly what I say in these conversations. And it gets really tense. This is what she says to me. She says, you make so much money.

I, you know, make $200,000 a year. I'm a gas and oil engineer. So the income is, is, is fairly high, but I'm using a lot of that income to, to, to grow the wealth, to get rid of the mortgage and, you know, simply to have a large margin because we have seven children. Yeah, you don't want to, I don't want to be prone. I don't want to be vulnerable, you know, to these markets, just like you're talking about. However, when I bring this up, she says, you know, you're basically, she says to me, you know, you're not, you don't have a vision or you don't seem to want to use the money in a kind of visionary way or we could survive the debt or even if we go deep into debt,

we'll just make it work because Joseph and Mary were poor and destitute too. And we could be poor and destitute and I would be fine with that. She wouldn't be poor. She wouldn't be happy with that because then she wouldn't have the 2,800 square feet or the renovation. Here's the thing. And I always tell couples, play this call for your spouse. Here's the thing.

$200,000 is a great income. You did choose to have a larger family and you did choose the home that you live in knowing that you were going to have seven children. You did choose a homeschool life to john's point um i want to know let's talk a little bit more about these margins though because there's there's a couple options here to you can do what john said and this is i'm saying this more for your wife than for you right now you can do what john said and say okay what in our community is available to us space-wise that we can use daily or a couple of times a week just to get outside the house and do this thing for free or let's convert the house and do this thing for free. Or let's convert the garage and we'll pay cash.

It costs us 25 grand or whatever. We'll put a cover over the back patio and then we can do some of our classes outside. Like there's so, so many. You want to talk about visionary? Let's get visionary. Let's get creative and let's both come up tonight. That's the homework. Hey, tonight you write down five ideas. I write down five ideas and we each get to veto one, right?

Like let's, let's use our brains here and not name call you know what i mean or say you're not enough of this or you're not enough of that let's just write down ideas and pick one and it can't be debt because that is dangerous to our family and dangerous to our kids that's thing number one thing number two is let's talk about what it would take to save because you said right now you're investing a lot right now you're trying to pay off this house let's see what it would take to save. Because you said right now you're investing a lot. Right now you're trying to pay off this house. Let's see what it would take. I don't know if you're investing more than 15%. I don't know what you're being intentional about

as far as paying extra towards the mortgage. Maybe for a period you pull back on that, not below 15%, but you pull back a little bit in order to fund this a little bit more quickly. $100,000 dollar renovation you're doing the most so is there something you can do that's less is there a way to do this in phases like let's turn on that creativity i said okay well perhaps we could take this project in bite-sized

chunks which he said to me in responsive no, because we need to do it all now because it will be more expensive to do it in chunks. It's just a lot easier to get it all done now. So if we have to take out $100,000 to $150,000 to do it all now, that's value for us now. She doesn't see that you're putting your family in danger. I think if she could see that. She does not see this. No, she doesn't see it. Here putting your family in danger. I think if she could see that. She does not see this.

No, she doesn't see it. Here's what I would tell her. I would say as much as, honey, as much as you feel hung out to dry right now, I can't in good conscience leverage this entire house, our entire family's future, on this one little building project. I can't do it. I can't be there. You can't do it.

And then y'all have to have a bigger picture. Y'all are talking different languages, and you are nothing but vision as far as I'm hearing. We'll be right back. Welcome back to The Ramsey Show. I'm John Deloney, joined by Jade Warshaw. Let's go out to Knoxville, Tennessee and talk to Brian. Hey, Brian, what's up? Hey, guys. Thanks for taking my call.

You got it. What's up, brother? Hey. So I'm kind of in a little bit of a situation. So I've completed baby step one and I'm looking at it. And so far far the only debts I've got right now are a truck payment my mortgage and I know the rules on payoff all you just accept your mortgage but my truck payment is 22 and a half and my mortgage to pay off my PMI just to get my PMI off, is going to be about $10,000. But my situation is my work pays for my truck monthly, but I know already I'm upside down on my loan for my truck. What's it worth? So the truck right now is probably worth, I'd say, $19,000.

Okay. But I paid $25,000 for it about a year and a half ago. Okay, but you owe $22,000. And you said your work makes the payment, so anything you put towards it is obviously extra towards the principal to pay it off. Correct, yes. Okay, great. So it sounds like what you're wanting to do is pay the $10,000 off on the mortgage first

to recoup your PMI or to get that charge off? Yeah, I'd like to have the cash flow in order to be able to pay off the truck, but I don't know. So I've already got 150,000 miles on my truck. If I need to pay off 22 and a half, should I just basically count that as not even debt because it's washed every month? It's on your name, isn't it? Yeah, it is. Yeah, it's your debt, brother. The payment's being covered, but you are the one that owes $22,000.

Yeah. Listen, what you're trying to do, I get it. You're trying to do the shell game and move the numbers around and do this thing as quickly as you think you can. But in this case, truly, the depreciating asset here is the truck. So I'd be working day and night. It's wonderful. It's a blessing that your job is paying the payment. That's even more fuel on the fire to get this thing paid off quickly.

I mean, you see it's only worth $ worth 19 000 you owe 22 so you got to get to work on this thing if you're going to keep it that is yeah okay and i guess you are so yeah well i'd like i'd like to keep it to the real sell off of it um you know every truck i've ever had has been over i'm running over 300 000 miles there you go now you're talking my language Brian. Good for you. Then pay it off because when it's paid off, it doesn't hurt as bad when it depreciates. When you still owe on it, you feel every thousand that it drops like a rock, right? So let's get it paid off,

and then you'll have lots of money freed up to go ahead and make this 10K on your mortgage, get that paid off as quickly as you want. Now, let me ask you this. Once you pay off the truck, what's the deal with your office? How are you able to... Will they pay you a stipend

regardless of if the truck is paid off? They will. However, I will... They want me to drive a car under 150,000 miles. So I've been in the rules a little bit on that. I run this way over 150,000 miles. They want you to or they force you to?

Well, I haven't gotten in that position. I haven't had anyone know that I have ran it over 150,000 miles. I keep them in pretty good shape. Because that sounds like they want... Like they're hiring you to do a job, but they want you to pay for the six-figure tool to do this job. That doesn't sound right to me. Them making the payment is not the same

as them buying you the vehicle. Well, and that's kind of what I'm worried about, because I know good and well that I'm going to be upside down on the loan, and if for some reason they do push me to get another one under 150,000 miles, I'm going to be in trouble because I'm going to be already right now, I did $3,000 upside down. Yeah, they want the benefit of you looking nice and you presenting their company in a certain way

out in public, but they don't want the risk of having to write the check for it. Yeah. Yeah, basically. And that means they can fire you at any time because you become a $75,000 or $80,000 liability, depending on how nice of a truck you have, plus your salary and benefits. Yeah, what happens if you buy it? We're just spitballing here about the future what happens if you like even now you've got this vehicle uh because they want you to have a certain type of truck what happens if they fire you you're still on the hook for the loan yeah or if you

decide to move on you know you're still on the hook for the loan so that is something to think about going forward but for your original question yeah let's get this truck paid off as quickly as possible if i'm you i'm never going i'm never having a truck payment again like i'm gonna and that's what i had my wife's cars paid off our student loans are paid off so that was but i kind of got looped into it and take it it's not my debt because my work's paying for it every month and then now i'm looking at my loan i'm looking for what all the cars are about my mileage and they're all about three thousand dollars less than what i still own on it so that's where i'm getting a little nervous well and lots of companies have fleet vehicles for this very reason so your your company's trying to have their cake um and eat it too right you you carry all the risk and we'll carry the uh we'll carry the visibility yeah correct yeah yeah we don't offer

any fleet any fleet options yeah and you have to have a four-door and that's so i can't do just a single cab you know beater yeah um so well i hate that for you brother i hate that for you i know i mean that's good that gives me even the gives me the words that I needed, though. Yeah. Yeah, it's your debt, though. At the end of the day, I like the way you said that, Jade. They're making the payments, but it's your debt. Yeah, man.

All right, let's go out to Syracuse, New York, and talk to Josh. Hey, Josh, I'm up against the clock, brother. What's going on? Hi. I am just looking to eventually own a home. But for that, I'd like to possibly own a duplex, live in half, rent half, and then eventually, again, buy the home. So looking for advice to get there. Okay, well, let's talk about it.

Well, the way we teach is it's not really time to buy a house until you're at baby step 3b in this case it just so happens that you want to live in a duplex which would kind of have a rental space in it as well so i'll call it 3b um and to get to that you've got to go through baby steps one two and three so baby step one's a thousand dollars saved baby step two you pay off all of your consumer debt. Do you have any consumer debt? What does that entail? So it'd be anything that's not a house. So car payments, student loans, credit cards, personal loans, any money that you owe to anybody for any reason.

Yes. What do you owe? I owe a total of $63,000. Okay. Half of that's on a car, half of that's on student loans. $2,000 is on a credit card. Okay. So for the length of this call, I'll go past that because we see that you're in baby step two.

Do you have any money saved? At the moment, I've got about two grand. Two grand. Okay. So for most, I mean, that's baby step one. Baby step one is $1,000 saved. Baby step two, any money beyond that goes to baby step two, which is paying off the debt. So, you know, if you keep one grand aside, you put the other grand towards your debt.

And then baby step three is when it's time to save up three to six months of expenses. That's your rainy day fund, fully funded. If life hits you, you're ready for it, right? And then after that, that's when we tell people to start saving up for a down payment on the home of their choice. Now the parameters for that, and you can go back to listen to this call because I know I'm throwing a lot at you. The parameters for that house is you don't want it to be any more than 25% of your take-home pay. And most people make that happen by putting down anywhere between 10 and 20%. All right. Minimum is how we want to do that. We would also recommend a 15-year fixed rate mortgage to do that. So those are some parameters to think through this.

Just based off this call, what you're telling me, I love your dream to do this. It's a little ways away. You've got some things that you've got to clear up first and save up in order to do it the right way. And in a way that's actually going to feel like I'm doing something, like I'm making money. And nobody outside of our gang is going to tell you on TikTok that your dreams are the right. Do it this way and turn off the noise on YouTube and off the TikToks and the social media accounts

that are like, here's how to hack your living. Like, man, you're going to hack your way into a big, big mess. Pay off your debts, save up money, get a down payment,

do this the right way so you can have peace in your home. This is The Ramsey Show. We'll be right back. Welcome back to The Ramsey Show. I'm John Deloney, joined by Jade Warshaw. You know that two-thirds, this is probably the statistic on this show that blows my mind the most.

Hit me. Two-thirds of Americans die without a will. Wow. Wow. It's mind-boggling to me. Two-thirds of Americans die without a will. I can guarantee you two-thirds of America don't think their government is doing a great job with their money yet. Wow.

By not having a will, say you know what government you take care of my assets and my family and my kids i'll just let you guys do that it's the kids part for me like i don't think people realize that if you don't say in your will who gets your kids if something happens to you and your wife or you and your spouse then some court somewhere will decide yeah yes when you die without a will you're inviting the court lawyers and the public because why not into the most personal parts of your life billionaire industrialist howard hughes known as one of the richest men in the world died in april 1976 without a will after his death over 600 people came forward claiming to have an interest in his fortune

in the end the judge decided that his $2.5 billion fortune, which back in 1976 was basically a jillion dollars, would be split between 22 of Hugh's legal cousins in 1983. Wow. For those of you with 22

different cousins, would you want all of them to have a chunk of your money? Don't let the government decide what happens to your state or even worse your kids we want to challenge you this august to create a will that means you're gonna have to look in the mirror and look across from your loved ones if you're married and come to this startling truth you will die there will be a day when the earth spins without you here so that's choosing reality then you're going to choose to make a will in less than five minutes you can find out if an online will will

work for you at ramseysolutions.com slash wills quiz or you can click the link in the description if you're listening on youtube or podcast and by the way when i left texas and moved to nashville i didn't know that our wills didn't transfer. Right when I got here, I got online and did an online will just so I would have a bridge until I could sit down with an attorney and go through everything. But I wanted to make sure that the first two weeks I was here, I didn't get in a car wreck and my kids were left wondering which cousin they were going to get sent to or wondering which aunt and uncle. Right. Like, yeah, that's my job as a parent and a lot of people think it's like morbid to talk like this but it is such a reality and truly i think that it's a cop-out if you don't it is a hundred it's a cop-out

if you're like oh it's too hard like this is a weird cop topic conversation i just like think about it like this is you want a court to decide what happens to your prized possessions yeah what your grandfather gave you right you know what i mean like that's crazy i just trust me i will say this when sam and i first did our will it was not the funnest of times it was uncomfortable i cried it was uncomfortable it took several nights and then even once we did the papers he truth be told he kind of was like hey did you sign it yet hey did you sign it yet hey did you like he kind of had to track me down to like get me to sign it because i don't know why i don't know why i thought it was gonna be a negative thing but i'll tell you john the moment i put the pen to paper and he was like okay i got

it's been notarized and it was all set i breathed easier than i breathed when we paid off 460,000 of debt because you know your kids are going to be it was my kids or your kids are going to have here's what they're going to just be able to grieve you guys yeah they're not also going to have to grieve you guys and figure out what town or state they're in or what happens to the house that's right all that stuff yeah get a will get a will it is the best way to love your family truly truly and if you find out if you get online and go to ramsaysolutions.com slash wills quiz, W-I-L-L-S-Q-U-I-Z, or click the link in the description. If you find out that an online will fits your situation, you can get 25% off when you use

promo code will month, one word, at checkout during the month of August. And by the way, an online will is very, very inexpensive. It's wildly inexpensive. So go check it out. Go to ramseysolutions.com slash wills quiz. All right, let's go out to Fort Worth, Texas and talk to Angela. Hey, Angela, what's up? Hey, thank you so much for taking my call.

You got it. How can we help? Well, so I have no support. I work at a bank job that I'm miserable at. And my plan is I want to go back to school full time, but I don't want to get myself into debt. I just spent the last three years getting myself out of debt. Good for you. How old are you? Thank you. I'm 27. So when you say you don't have any support, what do you mean?

No family support, no history of financial help or anything like that. Okay. When you say financial help, what do you mean? I just take care of myself. I rent. I don't have any prior financial knowledge. I don't come from a family with money. So my family was on welfare. And so I'm actually, you know, I've been having to get out of that. So you're changing your family tree from the roots out, right? Yes.

Got it. Can me and Jay just tell you we're proud of you? Thank you so much. Can I tell you some of the discomfort you feel is simply you're wearing a different set of clothes than you grew up in. And it's going to feel uncomfortable for a while. And I don't want you to feel like you're doing something wrong or you're somehow less than or broken. It's just going to feel uncomfortable because you're used to driving in this kind of car, wearing this kind of suit.

And now you're wearing this kind of suit and driving this kind of car. And the truth is your family, they don't, if you said they come from poverty, are they still there? Yes, they are. Then they don't understand how to support you because you're doing something they've never done before, and you are gaining knowledge that they never had. So a part of them might be confused and wondering what it is that you're doing

and what it is that you're trying to do and that's frustrating too right definitely so you want to you're changing the game you're 27 years old you're working a job you don't love which most of us did at 27 you did um you did spend the last three years paying off all your debts. Are you debt free? I have one more loan. I had my associate's degree. So it's $3,500. And that's all you got left? Yes. How much do you make at this bank job?

About $47,000 a year. Dude. You're killing it. You're doing great Angela. It's amazing. Thank you. Okay. And so what do you want to go back to school and do um psychology oh man i'm telling you that's a terrible i'm just kidding that's great good for you that's where i spent most i do want to go um get my master's eventually great go all the way up the only thing i do i'd say is make sure you pay cash for it. Don't do these loans anymore. Okay.

Can I tell you an idea? Yes. In Fort Worth there, are you in the Fort Worth area? Yes, I am. There's about 8,000 different colleges and universities in that area. With your knowledge at working at a bank, whether you're doing teller work, customer service work, or you're actually doing loan officer stuff, you can find a job at a local university somewhere in the Fort Worth, the DFW area.

And what that will do is give you a significant tuition support while you go get another degree. My second PhD was almost entirely paid for because of a tuition reimbursement program or tuition program at the university where I was working. Okay. And so if you hate your job and you want to get back into working with people, get online and see if you can apply for it. There's going to be multiple $40,000, $40,000, $45,000 jobs. They're going to have some sort of tuition support at one of those universities there in the dfw area and that's the way i would approach it if you if you were my sister that's

what i would tell you to do today start getting online and looking just don't don't don't don't get impatient and go borrow money you've worked too hard and you're doing too big of a thing for your family okay okay thank you so much and it's And it's okay to be 27 and know you're not in your dream job. 100%. You know what else you can do at that job? What do you do on there day to day? I do both teller and banking side. So I talk to people about financial planning and things like that.

If they need a home loan, I send referrals. You know what you're training to do? Be a psychologist. Did you know I used to sit with clients during my practicum and they would tell me all about who they'd slept with. They'd tell me about family trauma. They would not talk about their money because the shame was so deep. Yes, I see that.

If you start thinking about these interactions as ways to practice entering into holy sacred space with people who are hurting and you're able to talk to them about money and continue to look them in the eye and stay in their space even when it gets awkward you are practicing to be a mental health professional down the road no minutes are wasted unless you waste them and then get on get on the internet and see if you can find a job at a local university and you're going to be on your way. We're so proud of you, Angela. We'll be right back on The Ramsey Show.

Welcome back to The Ramsey Show. Today's scripture is Psalm 149.4. For the Lord takes delight in his people and he crowns the humble with victory. Goldemere says, don't be so humble that you're not great. Kind of like that.

I like that. Hmm. Alright, let's go out to Philadelphia where he was born and raised in the playground is where he spent most of his days and talked to Jacob. What's up, Jacob? Hey, guys. How you doing?

Love your show. Love listening to you guys. Well, we love you too, brother. What's up, man? So I have a quick question. I'm on step two right now. I got about $130,000 of consumer debt, not including my second mortgage, 160, including it. And in that, right at the end of it, there is a small business loan that I had from a dump trailer business.

I didn't work out two years ago. Now I made a choice to do this anyway. Um, but that business loan has a prepayment penalty. So it was a seven year loan,. Seven-year, well, commercial loans, it's common. I guess it's not as common on private loans. Yeah. And it was 8% interest for seven years, and a total amount of $26,500 was the original loan amount. Okay. I owe about $19,700 on it now. The penalty is I have to wait four years.

If I wait four years, there's no penalty, but I paid all that interest up until four years. If I pay it off early, I owe the remainder of the interest on the entire loan on top of the principal. Dude, that's a big box of farts, Jacob. I'm sorry, dude. How much is the interest? Listen, it was my choice.

How much is the interest? Have you done the math it was my choice. Was that? How much is the interest? Have you done the math out? Yeah, so it's an extra, right now, it's like an extra $6,000 or $7,000 if I were to pay it off today. Oh, my gosh. I know. So, or I can wait the four years, and I'll save $2,000 of that interest, but I'll pay the other four over time. So, if you pay it off, okay, so if you if you said you'll save $2,000 in interest? Yeah, but at 48 months, there'll only be $2,000 left,

which I won't have to pay after that 48-month mark. Do you have the money? I don't. So that is like loan seven in my baby step. So let's say right now with the second mortgage, I would be done baby step to January of 2026. Um, I can't pay this loan off till April of 2026. So if I switch it with my second mortgage, um, I can basically wait and save up the money in my quote unquote emergency fund after that, and then wait the three months and when april comes just get rid of it yeah um if you said the pay the penalty was going to be a lot

less i feel like seven thousand dollars is a pretty decent hit um and you said it's four years the four years from the beginning date which was april of 2022. So April of 2026, I can pay it off. If I were you, I might take the stupid tax on this. Okay. Because four years is a long time. John, what would you do? It is. Yeah.

There's a scene in one of my favorite movies, and I won't go through the whole scene just because there's a lot in one of my favorite movies, and I won't go through the whole scene just because there's a lot of profanity in it, but in Good Will Hunting, and he just says, I choose the wrench. And that's me in this situation. I've got some anger issues way down there, and this kind of stuff. It's just maddening. It just traps people.

What's your income? Dude did i'd pay it i'd pay it my wife's household income combined is about 250 right now pay it um here's how i look at it right now it's like there's like eight grand a month but i'm not gonna get to that loan on my baby steps probably until October of next year. So at that point, it would be less anyway. Oh, what's in front of it? There's, like I said, that's like number seven down the line. I have a bunch of other ones that are small. I missed that, Jacob. What's in front of it? How much is in front of it? If I have 160 total, there's about another $110,000 in front of that first. Before I even get to that, I got to pay off $110,000 in my baby steps to reach that loan. So it'll be less for that time anyway.

Yeah. Okay. I'm not saying that it changes my thing here, but I mean, by the time you get to it, yeah. It'll hurt a lot less. And you'll be so pissed after paying off $100,000 something grand by the time you get to it yeah it will hurt a lot less well and you'll be so pissed after paying off a hundred something grand by the time you get to it yeah you're gonna be that two thousand bucks will be a sleep tax exactly right

like and dude I the things I'm thinking of that you can go to a copy like a Kinko's I don't even know if that store still exists Kinko's John is it still around? Is it right next to Blockbuster at the local strip mall? Oh, boy.

But I would be tempted to make some photocopies of some things and put them in the envelope with that last payment. But, dude, I'd just pay it. I'd pay it and be done with it. That's what I say. I also have an attitude problem when it comes to that. I hate it. Here's the deal. done with it that's what i say but i also have attitude problem when it comes to i just i hate it here's the deal i believe strongly in paying for things of value i have no problem i think that's amazing but when business when entire businesses set themselves up to win when their

customer loses yeah you have to fail in order to yeah i hate. And this is one of those situations where they have made it impossible for you to have a good year because no matter how good your business is doing, they have chained you to something. And again, I love that you're being a grown-up about it. Do what? Yeah. The worst part about that whole thing was it was a dump trailer business, and in the state of New Jersey, I did not have the right license to run it, and I didn't know about it. And they wanted to fine me $30,000 for doing what I was doing, so I had to business and in the state of new jersey i did not have the right license to run it and i didn't know about it and they wanted to find me 30 grand for doing what i

was doing so i had to stop and shut the business down hey that same thing goes for governments when they want to they want to only win when their citizens lose so listen brother you're being an adult about it and if you were here i'd high five you and what do i mean by that you sign your name to something dumb but you're taking full grown-up ownership of that we've all done it and i'm proud of you thank you and so i i mean it's six and a half dozen another jade in terms of like what baby step in what order you're paying off a ton of money you're gonna get it done you make a jillion dollars you're gonna be fine part of me just wants to not do business with people who are only surviving because they trap and hurt people i just wants to not do business with people who are only surviving

because they trap and hurt people i just want to be done with them yeah so here's my two grand bye felicia i'm out but that's just me yeah no i do walk the baby steps in order and when he gets that one whatever it is paid off just paid off yeah cool that's what i would do i appreciate the call and jade i think that's an important thing we we take a lot of grief especially George because he sits down with people and gets into the into the numbers into the minutiae um we say this all the time but money is is 20 percent numbers and people want to like fight us with math you're right you could get more of a return here and less here we're always going to talk about a psychology and be the risk and if you owe somebody money you are sitting on

the wrong end of a teeter-totter and at some point somebody will drop an elephant on the side of that thing and you'll be flung into the moon unless you just get off the teeter-totter completely yeah i think at that point it's it's mental calories you know he will have been in baby step two for however long and it's like at that point you just, it's mental calories. You know, he will have been in baby step two for however long. And it's like, at that point you just want to knock stuff out. You don't want some, you already know you made the mistake.

Yeah. Then to have it chained to your ankle for the next two years, you know, it's like whatever you, he, he will have the $4,000 pay it. And whoever's listening in there, they just pushed their,

um, their glasses up their nose and they push their pocket protector way down they can push their pocket protector well actually if you took that two thousand dollars that in penalty and you get you're right you're right you could put that in a high yield savings account and when you turn 75 years old it'd be worth 18 billion dollars or whatever your calculation you're right but he's gonna sleep the next day that's right and he's gonna keep sleeping and he's gonna have more peace in his home and he's going to sleep the next day. That's right. And he's going to keep sleeping and he's going to have more peace in his home and he's going to be on fire for that very last loan that he locked

and he's going to be free faster. And I don't think, Jay, people do that mental calculation, which is we are solving for freedom, for zero. Get to zero. Get your head above water. Get your body out of the water

so you can finally get on living your life. Yeah. No, I think that people don't think about the toll that this takes on you and how you just want to be done and move on it's like we talk to people all the time uh they're going through a divorce but they keep their spouse on the mortgage it's like just cut it off you know like just do the things so you can move on or it's like like, you know, you're breaking up with somebody, but they keep texting you. It's like, can I just move on? Please stop texting me. And it's the same thing with this.

Sometimes you just have to like delete the contact and change the number. Like it's over. You got to be all the way broke up. All the way broke up. Well, thank you, America, for hanging out with us today. We'll be back shortly answering your questions about money and life right here on The Ramsey Show. Thank you.