The Ramsey Show - App - Your Debt Is An Emergency (Hour 2)

Episode Date: December 15, 2023

Девочка-пай Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm George Campbell, joined by bestselling author and host of The Ken Coleman Show. You guessed it. Ken Coleman joins me this hour. The number to call is 888-825-5225. If you've got a question about your money, your work, the intersection of that, your life, we want to help you take the right next step. And Ken is my favorite person to host with.

Oh, thank you, George. When it comes to work questions. Oh, I see how he did that a long to see that he pulled me right in and thought it was a hallmark card nope nope just a sticker you just a sticker but hey you fell for it here we are we're at the end of the year and a lot of people thinking about do i start a business in 2024 do i start that side hustle i finally quit that job how do i make more more money? Forget the quitting of the job. Do you want to make more money?

Who doesn't? I'm your guy. Let's go. Let's get that shovel bigger so that we can get through the baby steps faster and live the life we truly want to live. That's what I'm here to do. So any of those calls today, let's take them. Let's do it. Lizzie kicks us off in Austin, Texas. Lizzie, welcome to the show.

Hi, thank you for taking my call. I just found out I was pregnant with our miracle baby on Friday. Wow. Wait a second. How is this a miracle baby? Give us the story. Because, unfortunately, we've had two miscarriages in the past 13 months. And we were actually going to start doing IVF. We'll save up for IVF. Because, unfortunately, we've had two miscarriages in the past 13 months. Oh.

And we were actually going to start doing IVF. We'll save up for IVF. Yeah. But we actually got back into the FPU, and we're like, you know what? We're going to put that to the side, and let's just tackle the debt, because we have an overwhelming amount of debt, mainly business debt. But because everything is personal collateral, I just think it's all personal debt anyway. You would be correct. You're right. Your name's on it.

Well, congratulations. Exciting. I haven't even told my husband because I don't even know. I feel like I can't even be excited. You told us before your husband? You told these two clowns and millions of other people before him? I hope he's in a hole somewhere safely that he can't hear this.

When do you plan on telling him? I'm planning to tell him for Christmas because I have been doing the blood work and everything just to make sure everything's going good and that we don't have an unfortunate event again. I don't think this is a good idea. I don't think it's a good idea to put this out there on the show and then wait until Christmas to tell him. I'd sit him down tonight with a smile on your face and say, listen, I know we've been through a lot. You're not going to believe this, but here you go. I feel like we should conference call him in and tell

him right now. That's what I think. Yeah, I wouldn't wait for the mori moment for him to go you are the father yeah i'd go ahead and tell him now okay but that's just two guys opinion i'm actually gonna meet him here probably in about an hour before he goes into work yeah that's a lot for you to carry that's like your little secret for the next 10 days you have listen i i i want to get to the debt stuff but i've got to say you have got to tell him today before he gets into the off you can't you i feel guilty like i'm i'm a mess right now our live studio audience isn't a get they don't know what to do either don't you all feel like i so we should tell this guy i can't bear this this burden is too heavy the funny thing is too is that he predicted it about three weeks ago, and I'm like, no, there's no way, and it's too soon anyway.

And it turns out he was right. Well, that's why you sit him down and say, hey. This guy called his shot. Hey, honey, your crystal ball was correct. You'll never believe it. Okay, Lizzie. This is the craziest thing that's ever happened to me on the show, George. That's pretty wild.

All right. But it's an honor that you trusted us with this secret and millions of listeners let me gather myself i feel like we can't be excited or i can't be excited is because we have 50 000 50.5 000 in personal like personal bill debt on top of we have $651.5 thousand dollars of business debt that is all tied to our personal. Oh my gosh. What kind of business debt is it? Construction debt and it's anywhere from credit cards to personal loans to 80% of it is probably friends and family. I say friends and family, but honestly, it's more like loan sharks. Well, it sounds like your friends and family made a bad investment.

Is this business still afloat? Is it doing well? Where is it? It is doing well in the sense of, and it's combined my business with my ex-business, which is also a construction business, but I keep wanting to sit them down. That's the is also a construction business, but I keep wanting to sit them down. That's the other issue too, is that I keep wanting to sit them down and talk numbers,

but it just ends up being a big ordeal. We get into an argument and we just can't seem to come eye to eye. And I've showed them like the plan of what I, cause, uh, I, we started doing SPU again and I'm doing the everyday dollar. Not only I got the everyday black Friday deal, um, a dollar black Friday deal for the personal finances. And then on top of that, I'm also doing it for the business. So I got two,

two of them. What is the, what's the household income? The household income for just my husband and I, with his W2 income, my W2 income and the business income is about $18,300 a month. A month? A month. And that's gross?

And that's gross. That's what we take home, yes. Okay. Are you guys paying your taxes? Are you putting money aside for that? How's that working? So, and that's the other thing, included in the numbers I gave you that we're in debt, I'm assuming right now we probably owe about $15,000 to $16,000 worth of taxes. Okay, that's going to go to the top of the debt snowball. Oh my gosh. That's going to be the first thing you pay off is the IRS debt. And then we're going to continue on down, smallest to largest balance. This is going to be years and years of sacrifice.

One quick question on this. You said W-2, W-2. So this company that's got the $600,000 in debt, is that separate from your day jobs, your normal jobs? So that's separate from our day jobs. My husband already works 14 to 16 hour days, six days a week. And I do the same thing on top of that. On top of that, that's including me managing the construction company um who's who's working for you when you say manage the construction company and you're working 14 to 16 hour days who are you managing I am managing we have a group of I we used to well I own one I used to have about 15 people. I cut it down to about eight.

I weeded out the people that I feel like, instead of making me money, I'm putting money to. Okay, so you're like a general contractor, essentially. I'm a general contractor, yes. And you're both working 14 to 16 hours a day. Correct. Is there any collateral that you guys could sell as part of this business? Equipment? Is it real estate?

Yeah. This is going to take a decade to get out of at this rate. Well, I crunched the numbers, and if I put $1,200 towards the business debt, and my dad puts $1,200 towards the business debt, we'll be done in 28 months. Wait, your dad is half partner in all of this? Well, the $651, half of it is his. However, well, I say his, rhetorically, I don't want to, what's the correct word? Because at the end of the day, it's under my name.

Out of that, probably only 20% is under his name. So no matter what, I have to pay. But he's paying half. This is like a Common Core math question, Lizzie. We got to sort this all out. And I'm excited for the baby. But you're right. We got a mess on our hands.

It's going to take some drastic choices for probably five to 10 years to clean this up. But I hope it's faster than that. We are wishing you guys the best. Congrats on the baby. Tell him today. Please don't let him find out from this show. This is The Ramsey Show. Hey, you guys. Health insurance costs are only moving one way, and that way isn't down. And if

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they experience a medical event. So listen, y'all, there's no better way to take care of health care costs. CHM programs start as low as $98 a month. So learn more today and join at chministries.org slash budget. That's chministries.org slash budget. This is The Ramsey Show. I'm George Campbell, joined by Ken Coleman. The number to call is 888-825-5225. Today's question of the day is brought to you by Neighborly, your hub for home services. There's never a good time for appliances to break down, but Mr. Appliance, a Neighborly brand, can fix them and help make sure they're running properly.

Go to Neighborly.com slash Ramsey to learn about upfront pricing from Mr. Appliance. By the way, I was called Mr. Appliance in my early college years. For as much as you were a handyman? Is that where that came from? I just love these names. I'm jealous because I can't fix anything. If they called you like Mr. Toolbag, that one I think is more appropriate. Mr. Toolbag, I get you. All right. Today's question- Applause from the studio, the booth guys. I like that.

Glad you guys are paying attention today. That's good. Today's question comes from Joseph in Oregon. I work in biotech as a data scientist, and my company is experiencing financial struggles with cash flow. I was just hired in this role about six months ago, and I'm wondering if it would be too soon to begin looking for another job. I left the job that I had before this one after one year because my manager was extremely toxic

and the company culture wasn't good. Will two employment stints in around a year be a red flag on my resume? Let me just answer that one while we're here. Yes. Is it something you can overcome? Yes, you can overcome that. But is it a red flag? Without question.

For what it's worth, I really enjoy my current role, team, and company. With that being said, I just got married to my wife two months ago, so I want to make the best financial decision for my family. Moving forward. Would it be wise to begin looking for another job, or should I wait to see what happens with the company in a year? I think, Joseph, you have a lack of stick-to-itiveness. That's a made-up word. It's a quality. It's like a little bit resiliency and a little bit of patience mixed together. That's stick-to-itiveness.

And what I see here is a pattern of, I don't like what's going on right now, and I'm immediately going to pull the escape hatch. I'm out. And I see that a lot with younger generations. And there was a phenomenon that happened in the marketplace in 2021 and 2022 when we saw four-plus million people a month leave their jobs for about a year and a half. It was extraordinary. Never seen those kind of numbers before. They call it the great resignation. You may have heard about that in the news.

Well, a year later, we begin to hear a term called the great regret, where it was millions of people who left during the great resignation. The grass is greener over here. I can get more money over here, and that makes a lot of sense on paper. Well, what happened is they made the move, and it wasn't the right move, and they began to regret leaving. So I think you might regret leaving this company right now. I think it is, other than a slam dunk where you've got a better gig and you aren't having to walk through all of the, you know, I was at this job, then I left, then I was at this job.

Listen, if your company is going through financial struggles and cash flow, you need to be looking as a backup plan anyway. But just to immediately go, oh, I'm going to leave now, I don't think you have to. Do I have some options in this case, George? Yes. But let's just see how it plays out a little bit. He doesn't mention anything in here that he feels like he's going to be on the chopping block, nothing like that.

If he was on the line, I'd ask, has there actually been layoffs? What has been said from leadership as far as the struggles? So I'd ask more questions, but I think when it comes to the employer, you're right, Ken, it's a red flag to the employer. They're going to ask, and so you better be ready to answer honestly and tactfully. Hey, what happened? You had two jobs in the last year. Well, one was this. It wasn't a culture fit. And this one, they had financial struggles. I'm not going to, you know. So I left.

And that just makes you look a little flighty. Here's the thing. You know when we get on the plane and they say, all right, we've got to go through the instructions. And, you know, if we have to make a water landing, they tell you all the things. I think professionally you've got to have a plan. Like what would happen, you know, it's that kind of deal. How would I exit if I was forced to exit? But in this case, a full-on search, I don't think I would do that in this case.

Listen, there's a lot of people out there that need to hear this. If you go through a storm in your workplace, it's possible it's just a storm. It doesn't mean it's the new normal. And I think there's a big difference, and I think a lot of younger people are susceptible to this. Listen, when a big storm comes through, here's what we know. It blows through, the sun comes up the next day, and we move on. And I just think that many people would do better to weather a storm or two or three before they pick up and just move on.

I think you get into a pattern of moving, changing companies. Every time something doesn't go your way, it can very quickly turn you into a vagabond, and I think that's dangerous. That's good wisdom. Appreciate the question, Joseph. Good stuff there. Let's head to the phone lines.

Peyton awaits in Chicago. Peyton, welcome to The Ramsey Show. Hey, thank you. Good afternoon. Hey, how you doing? How can we help? Yeah, I'm doing well. So I'm sitting pretty well in regards to like my income and my debt, my investments. However, I have the opportunity to return to graduate school, and I'm not sure if that's a good financial decision for me, considering I'll probably end up taking out student loans to pay for it. Did you say you have debt right now? No, just my mortgage. Okay. And what are you going to

graduate school for? That would be for a master's in engineering, and it's in MIT. Wow, that's impressive. And I'm guessing you're in engineering now full-time? Correct, yes. Okay. What are you making now? Making about $152,000 a year. Amazing. And would this help you, I assume, get a big bump in pay? Are you looking to switch in a different field, or would you just excel in that field and get promoted there? Yeah. I would hope it would have a pay increase. My larger hope, though, is I'm currently an individual contributor, and it's not looking like I have a clear path in my current company to become a people leader of technical people.

Which is what you want. So my hope is that... Exactly. Yes. So my hope is that following this graduate degree, which is a joint program between engineering and business that MIT offers, that I'll more easily find myself in that trajectory to go to a supervisor of technical people. What would it cost for you to cash flow this? Probably around $90,000. Total? Yes. Yep. So I'm actually currently enrolled in the program. I'm a semester in my next semester.

And then a year following that is what I would need to pay for. Could you somehow save up 90 grand, pause all investing and just stack it up, making 152? Yeah. So I'd probably have to sell some of my investments to get to that $90,000. Outside of retirement? Yes, outside of retirement. I would do that. Do you know why we're suggesting that? Before we tell you, I'm just curious when someone hears us say things like that, does that make any sense to you at all? Because if it doesn't, it's okay, but I'm just curious. Yeah, I think I follow that train of thought. I also have the converse train of thought that maybe it makes more sense to leave that money there and accrue the gains in the mutual funds that it's in right now for that year instead of pulling it and then

feeding it again. Okay, so let's fast forward. Because it's a short amount of time. Right, right. So let's fast forward to the end of the program and you're $90,000 in debt. Have you run the numbers on what that payment is going to look like when you got to start paying that back? No, I have not. I would. I would fast forward to the end of the line with taking out a loan and think about what kind of money am I going to be making? Okay. Do you have an idea about what kind of money is realistic for you with this degree? I would love to be in the neighborhood of $200,000 starting. I know you'd love to, but is that realistic? Yes, for an engineering supervisor.

Great. Okay. If you do your homework on this, George, all I'm saying is I like people to fast forward to the end of this thing and go, okay, what's going to look like even with that salary paying 90 grand back? Oh, yeah. As opposed to waiting using your advice of cash flow. How much do you have in investments outside of retirement, Peyton? I have about $38,000. So 38 plus your future income to save up, you could easily cash flow this in the next 12 months. That plan excites me. And how quickly, making $200K with no debt, could you restock $38,000 in an investment account?

Pretty quickly. Sure. So I would rather you move forward debt-free, and it's going to give you more options, more peace, and more freedom every time you work that plan. And I didn't ask your age, but it sounds like you're young. You got plenty of time on your side. You're clearly brilliant. You're going to retire a multimillionaire. I just want you to be debt-free in the meantime, and you're going to do it. I have full faith in you. Congratulations. Call us back and let us know how that path is going for you.

Thanks for the call. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Camel, joined by Ken Coleman. The number to call is 888-825-5225. Let's go to Atlanta up next. Don joins us there. Don, Merry Christmas. Welcome to the Ramsey Show. Thank you. Thank you for having me. What's going on? I am 53 years old and just started the program about two months ago. And I, because of where I'm at in my life with some of the debt, needing to build an emergency fund, etc., I'm doing steps two, three, four, and five at the same time. That sounds like a lot of things at the same time. Yes.

How's that working for you? Well, you know, I would love to just focus on two, but I have a child who's in college right now, another one who is going to college in the fall next year. So I'm real-time making payments, and I did not have any savings for college. Why do you feel like the burden is on you? My parents paid for my college. I feel it necessary to do the same. Well, your story's different, isn't it?

You're not in a place to do that. Are they going to in-state schools or community colleges? The first one is going to in-state. The second one will not be. Okay. And that was a decision that you both made or they just made? We agreed with that decision, myself and the child. Are they sophomores, freshmen?

I've got a freshman in college, I've got a senior in high school, and then I have a freshman in high school. Okay. So we got one on the way in, one that's in there, and one that's got a little bit of time. Correct. Okay. And how much debt do you have? I have $30,000 in debt. It's made up of car at $21,000 and an interest-free credit card at $9,000 until April 2025. Okay. What's your income? $225. That'll do.

Hello. Awesome income. So what if, let's just play this out, if you do it the Ramsey way and you focused on one baby step at a time, what do you think that would do for you? Because you'd be out of debt within a few months. You'd have the emergency fund a few months later. You'd be maxing out retirement at that point a few months later. And then you'd still have time to cash flow college. Well, the way I've worked it out and the numbers on, I don't see how I can pay off that debt in a few months, that $30,000.

Why not? Other bills that have to be covered. Well, college bills, let's say we put those aside, and let's say we're not putting anything in the emergency fund. Let's say we're not investing at all. Wouldn't that free up a whole bunch of money to throw out the debt? Right, correct. If I wasn't putting anything in the emergency fund, that would definitely help me. And so that's why we tell people to work these baby steps one at a time. I mean, right now you're doing Dawn's plan and I wish you the best, but I tell you with confidence that our plan works when you work it

the way it's supposed to be worked, which is one at a time, focus intensity until you get to baby steps four, five, six. And making 225, you're going to be there really fast. This isn't a whole lot of debt you're dealing with. Don, are you buying what he's saying? I am, yes. The concern is not having anything in an emergency fund. But I'm concerned about emergencies. Okay, perfect. So glad, because I wanted you to poke holes in what he's saying, because George is right. You should poke holes. But listen, you have enough money in your salary to be able to deal with most emergencies. And if you had to pause baby step two, which we

tell people to do at times if something big is there so that you can cash flow it, but you're going to spend more time doing it your way than you'll ever spend doing it our way. Because you're barely making any progress trying to do all those steps at the same time. You can see that, right? Your money spread so thin. But if you do what George said, you're going to knock that debt out really quick. And the next step is piling up that emergency fund and the money that you make, the income you make, you're going to be able to do that very quickly. I mean, you're bringing home 12 or 13,000 a month? It is my net is about 9,000. That's not tracking.

What I net. How? You're taking 50% home? So I am well that's, I'm so sorry. The net is because I just gave you over one period it's's, yeah, it's $9,000 because of the 401k, the HSA. So we're going to pause all of that, which is going to put a bunch of money back in. That would take it probably to $12,000, I'm assuming.

Yes. Yeah. And so what's an emergency that you would be really scared of happening? Give us a realistic emergency. Well, the medical, any kind of medical with my children. Well, they'll put you on a payment plan, and you pay when you can with medical. So give me another one. If I lost my job. Okay.

But again, we don't use emergency funds for job loss. We tell people, look, emergency funds are for things like medical emergencies, a car accident where you've got to pay more on a deductible, your HVAC system goes out. You don't want to be living off of your emergency fund if you can keep from it. Do you have to dip into it in a job loss situation? Sure. But the idea is we want you to get back to work, anything and everything to not deplete that. Here's the point I'm trying to make. I want you to think of your biggest, scariest

emergency monster, and I'm telling you with your income, you should be able to handle it. Isn't that fair, George? Am I being too aggressive there? So, Don, if you look at your bare bones expenses, what does that add up to, to just cover food, utility, shelter, transportation, insurance? Yeah, probably $6,000 a month. If I got rid of some other things. Some of the luxuries. Yeah.

So that leaves potentially another six that you could start throwing at this debt. And so you're really smart. This is easy math. In five months, paying 6K, you're completely debt free in five months. Huge. So even though I, because I should, I feel like I need to be maxing out that 4K at 15% because of my, I don't have much time to catch up at this point in my life. You don't have time to keep playing this game where you're treading water. Imagine making $225,000 with no payments in the world, and now you're maxing out every retirement account known to man for the next 10 years with catch-up contributions.

You're going to be okay. That's right. Okay. You're not losing ground, Dawn. I tell you all this to trust the process. I know it's hard, especially when you're in your 50s, and it's harder to change habits and behavior and look at things a different way. But I have met people who have been 60 and 70,

and they've just committed themselves to this plan, and it has worked, and they're able to retire with dignity. And for sure, you're going to be able to do that with your amazing income. If I had 21 or 19,000 in some stock, not retirement, would you recommend just getting rid of that and putting that towards the debt? Yep. I'd sell it and I'd be aware of the tax implication that may be there when you sell it on the gains. But I did the same thing, Don, to pay off the rest of my debt. Okay. Now, there's no tax implications because the company took care of the taxes. Wonderful. Nice. How much could you make on that sale? You said it's 19? Yeah. Right now, it's the value of it's 19. Do you understand that just means you're debt-free like a month or two from now?

Right. It's amazing. It's just in my brain, I've been thinking of that as helping with emergency if there was an emergency. We have to drop the scarcity mentality. You're doing great. What if we said your debt was an emergency? You need to get that out. How about that little mindset? That's a way to look at it. Good job. I'd say being 53 without a full emergency fund while playing with debt, that is the true emergency. And that's why these baby steps are all about intensity for a short season. And so what we're asking here is, Don, for six to eight months, you're going to be focused on this. Then we can start looking at investing again and helping the kids cash flow this. But the kids are going to be all right. They have an awesome mom. They're able to work part-time. They're able to hustle and get

scholarships and grants and choose a different school and take a gap year. You got to put your own mask on first, and that's you working the baby steps on your own right now, but we have full faith you're going to get there. I'm going to gift you one year of every dollar premium and Financial Peace University to help walk with you and encourage you along the way. So hang on the line. Sell it. Sell the stock. Do it. This is The Ramsey Show. Welcome back to The Ramsey Show. This is a show for you, America, to help you take the right next step with your life, your work, your money. Give us a call at 888-825-5225. I'm George Campbell, joined by Ken Coleman this hour. Let's go to the phones to DC.

Ryan joins us there. Ryan, what's going on? Hey, guys. Thanks for taking my call. Absolutely. Hey, so I wanted to get you some advice and some help from you guys, something we're struggling with. Me and my wife are wondering how we can continue tackling Baby Step 2 while I support her in wanting to stay

home with the kids. And she's going to, you know, transition into a part-time job, which pretty much cuts her salary in half. Okay. What's the current income? So currently right now, with no overtime for me, I'm making about $4,000 a month, and then she's making $4,900. Okay. And she's wanting to go part-time, or has she already done that? She will be going part-time. We have baby number two on the way, so he's due in February. She will get some paid leave with her job to help take care of the baby.

And so she's going to attempt to go back to work after that, but we know it's kind of not really going to work out. So come June, July is when she's going to transition into staying home with the boys and working part-time. And does she have a plan for that? Because you said it like you... Okay.

What's she going to be making? Yeah, yeah. She's going to make probably about $2,000 a month. She'll be working for her mom's travel agent company. Okay. So you posed it as we're struggling, we're having some challenges. What exactly are you wanting us to jump into on this? The budgeting side of this, or is this a marital relationship conversation?

Oh, no, no. This is a budgeting conversation. So we downloaded the EveryDollar app back in actually November 1st. So we've been at it about a month. We've gone from $168,000 in debt down to $109,000. You know, I've followed those steps, you know, took the savings down um which was a gut check um but you know with my job you know i travel a lot and i can get you know copious amounts of overtime so it does help and so you're really just trying to knock down the debt hole that i got us in and um before this happens before we lose the or if it's even. How long did it take to get that debt knocked out, 168 to 109? One month.

Because you took the savings out. Yes, sir. We took the savings. I sold stock. You know, the little savings we had for right before the baby's coming, you know, we just kind of went all in. And, yeah, now we're just tackling it. Pretty much any overtime I get over that $2,000 per paycheck is going directly to debt.

So is that net income that you shared with me? Yes, sir, it is. Okay. All right. So you bring home about $50K net, and she's bringing home about $60,000 net. Yes, sir. But overall, it'll go down to $72,000 if this all works out. Yeah, yeah. Okay.

So it's going to slow down your debt payoff dramatically with her taking a pause and then going part-time. And so that's a consequence of you guys deciding, hey, she's going to stay home. It means the debt may take six months longer than we wanted it to. Yeah. Except for... That was me wondering if that was okay, because we had this whole plan. And if God's wanting her to stay home and she feels like that's what she wants to do, I'm going to make it happen if I got to pick up all the overtime I need.

Well, you would need to dramatically increase your income. Because here's the thing. Average, it takes people 18 to 24 up all the overtime I need. Well, you would need to dramatically increase your income. Because here's the thing. Average, it takes people 18 to 24 months to pay off consumer debt. And looking at these numbers, you still have $109 to pay off. And I don't know how much you're able to throw at the debt every month. But, you know, let's say, how much could you think you can do now? Once she goes part-time. I typically, with the overtime, I'm typically bringing home close to $5,000 per paycheck.

But how much can you throw at debt? Our expenses are only, let's see, I'm looking at it here, $5,200 per month. Only? You're bringing home $5,000 and your expenses are $52,000? You're about to be broke, my man. Yep. No, no, no. The $5,000 per paycheck if I'm doing OT.

So the monthly expenses are the $5,000 and then the monthly... Is that sustainable for the next 12 months for you to do overtime? Unfortunately, in my job, you can't avoid the overtime with the government. Okay. Well, I would devise a plan to where you can knock out $109,000 in about two years. Okay. Whatever that looks like. With her working part-time, you working overtime, if it's going to take four or five years to knock this out, this is a bad plan.

It's just too long. George, I'm wondering, is there any lifestyle change you guys can make? So we've cut, you know, this will make you even more sick. We've cut $2,000 out of the budget worth of those extra expenses. You know, the subscription, the daily coffee meals, the, you know, nights out eating. And we've gone, you know, pretty much completely to we eat at home, and that's it. So you shaved off $25,000 a year right there. We've eaten out one time.

What's the $109,000 made up of? What kind of debt is that? That's me. Her student loans that she has doesn't account for anything. That's what accounts for. $15,500. And then the other $5,000, the last credit card, we actually, I got to take that off because we just paid that today. $5,712.

What's the chunk of it? What's the big one? The big one is the deck. When we bought our house, we financed the deck. And that was my fault. Yeah. We'll leave it at that. You guys got cars? I got a car.

Car loans? Yeah. She has one car. I do not. I get one for work. Okay. What's left on her car loan? No loan on it.

Oh, no loan. Okay. No, sir, no. All right. So real quick, George, I want to talk about his income because I hear the young man. I can hear the heavy breathing in this. I mean, I feel for you, man, and you're a good dude. One thing we haven't talked about in this conversation is your ability to increase your income, and I don't mean overtime. What do you

do for the government or what kind of work are you in? I work for Homeland Security. Okay. Is that the long-term play for you? So that's kind of the second part to it i didn't know if we'd have time to get into it i am looking at changing to a different position um i'm not going to do that until we are debt free because it is a salary drop for the first year um but it's it's less time away in these um you know kind of not so good areas and more time home. All right, but what, okay, and I think that's great. I love that part, but what's the long-term potential of this job that you would take a hit in the first year? What's it look like?

Is there a ladder for financial growth? There is, yes, sir. Like what kind? We move up every year. Oh, it's a good chunk. I'd have to have the scale in front of me, but it's the typical GS scale for the government. So after three years, I'm back to $125 a year.

All right, so listen, if I could play older brother really quick, okay? Yeah. That's another government job, and I'm not anti-government jobs. Every time I say something like this on the Ramsey Show, people come after me like, you're anti-government. Yeah, I am anti-government because I'm a conservative and I think people should be free to live how they want to. There's the commercial. But

you're not going to have as much financial potential working for the government as you could doing similar work in the private sector. That's what I'm trying to get at. My friend, you making $100,000, $120,000, $150,000 doing similar work in the private sector, I believe, is realistic.

I think you should check it out. But just limiting yourself to G3 and then after a couple more years of good service, Uncle Sam lets me move up the ladder. You're just really limited financially, yes or no? Yes. Yeah, you are. Well, my friend, let's do both. Let's get out of debt and grow professionally. How about that? Yes, sir. How about we go get a fat raise in the next six months? Instead of taking a step back in a government job, I'm challenging you to

think about it. Yes, sir. Ryan, the last part of this is you guys are in stork mode right now until baby and mom are home safe from the hospital, which means we're going to pause the debt payoff, make minimum payments, and stack up as much cash as you can over the next three months. And then once mom and baby are home and healthy, let's continue and throw all that at the debt. So that will help you as well, give you some peace as you step into this new phase. We're excited for you, man.

That puts this hour of the Ramsey Show in the books. My thanks to my co-host, Ken Coleman, all the guys and gals in the booth keeping the show afloat, and you, America. We'll be back before you know it.