The Ramsey Show - App - Your Parents' Debt Is Not YOUR Debt (Hour 1)

Episode Date: July 18, 2019

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. This is the Dave Ramsey Show. It's common sense for your dollars and cents, God's and Grandma's ways of handling money. Open phones at 888-825-5225. That's 888-825-5225. Shelby starts off this hour in Springfield, Missouri.

Hi, Shelby. How are you? Good. How are you? Better than I deserve. What's up? We have a 2008 Nissan Rogue that we've had for 10 years, and it just died today. The car itself is worth $3,000, and we have it paid off, of course. The transmission to put into the car to fix it would cost $2,900. So do we pay what the car is worth to fix it, or do we spend an extra $5,000 that would take about a year to pay off to buy about a four-year newer car? So you have the $2,900 to fix the transmission?

Yes. Okay. But we don't have the extra $5,000 that we would in about six months to a year. Why an extra $5,000? Just because you want a better car? No. Is it smart to fix,000? Just because you want a better car? No. Is it smart to fix the car? Both are dumb. That's only, what's that?

Both are dumb. Both are dumb? What's wrong with buying a $3,000 car with the money that you have? It doesn't seem like it would last us with our, we have four kids. You're driving a three thousand dollar car now yeah and it's broken yeah so you would say buy a three thousand dollar car that might have the same problems as our current three thousand dollar car well your eight thousand dollar car might have the same problems if you select a bad car a twenty five thousand dollar car can have a

transmission go out any car can have a transmission go out uh any car runs a chance of breaking down but if you want to use all of those emotions to rationalize going into debt you can but i'm not going to tell you to i think it's stupid i'll walk before i have a car payment but do we put the money into our broken car no like would you pay three thousand into a car that's for three thousand no i would sell your car i would sell your car as is for salvage i would take that money and put it with the actual cash that you have and i would not buy a car that had any debt on it okay now you said you could pay off a five thousand dollar additional loan in one year right right? Oh, or less.

Okay. How quickly could you pay it off if you went absolutely bananas? Maybe like two months. Two months? Mm-hmm. Okay. Well, then you could rent a car for two months and save up the money. Yeah.

Okay. And then pay cash for a better car if you want to do it that fast. Or you could buy the $3,000 car. How much money do you actually have in cash? About $3,500. Okay, and your car would probably bring about $500 as is, right? Uh-huh. So we're buying a $4,000 car with cash, and then save like crazy between now and Christmas and trade again.

Uh-huh. Move up. But would that be a wash? I mean, I guess we would pay. now and christmas and trade again uh-huh move up but would that be a wash i mean we wouldn't i guess we would pay we would get four thousand if we just bought a car for four thousand yeah four thousand car is not going to go down much in value in six months yeah it's pretty well done uh-huh so it'll hold especially if you get by a decent car you know something that's decent for four thousand dollars you're going to shop around make sure you you get something that's reliable and that's in better condition, honestly, than your Rogue was.

Yeah. And you can. You can buy a lot of cars for $4,000 if you watch what you're doing. We're not worried about the sex appeal of this car. We're worried about its mechanical substance. Yes. I don't care if people make fun of its body. I want it to work for those six months,

and during those six months you save up and pay for it now let's back off just a second okay okay here's the um reasoning behind this so that you understand why i'm coming down so hard on it the average car payment in america today is 507 dollars if the average person with the average car payment were to instead invest that money from age 30 to age 70, instead of having a car payment their whole life, they would have in excess of $5 million. Mm-hmm. Translation, car payments are stupid. Mm-hmm.

Because it costs you $5 million in the scope of your life because you see what i'm saying so if the thing you've got to do then is you got to go okay every time i have a problem i can't solve it with debt even if i can in quotes pay it off quickly put your air quotes up when you do that you know like pay it off quickly which is famous last words because usually then life happens and you don't pay it off quickly and you drags on out and you end up living your life from debt to debt to debt to debt to debt from car payment to car payment to car payment to car payment from this crisis solved by debt to that idea solved by debt to oh we went on vacation we didn't quite pay for it. We got that. Oh, last Christmas.

I forgot it was in December, so it's debt. And this is how most people live, and they live broke. And you work your whole freaking life giving your money to some stupid bank. And that's what I'm trying to prevent here. I want you to win. I want you to be wealthy. And the best way to do that is drive like no one else so that later you can drive like no one else. Today, you know what I drive?

Anything I want. You know what I drove when we went broke? A borrowed 1978 Cadillac that the predominant color on it was Bondo, and the vinyl roof was loose, so when you drove it, it filled up with air. It looked like a Bondo parachute coming down the road. You might be a redneck if was written on the side of it. Really. I drove that car for what felt like 10 years during one three-month period.

That car has scarred me psychologically to where i will never again in my life do anything that puts me or my family in a position that we have to drive some piece of crap like that again we are going to save we are going to live on less than we make we are going to have a plan we are going to work like maniacs we the ramsys are never going to do that crap again. My family tree has changed. And that's what I want for you guys. Instead of living paycheck to paycheck to paycheck, pulling up at a stoplight, comparing payments, I mean cars,

with everybody around you. Those are broke people at that stoplight. They look good, but they're broke people. And if they got a ski boat or a bass boat behind that nice truck, they're really broke people. Because they got a $600 payment on a bass boat because the former bass boat, the engine wasn't big enough and those bass were out running them. So they had to get a faster boat. Don't do this stuff we do this stuff we all do this stuff so we have to stop we have to go no at some point we have to break the break the mold break the cycle break the chains break the curses of our off our family tree and say

as for me and my house we're going to serve the, as for me and my house, we're going to serve the Lord. As for me and my house, I don't care what you think about what I drive. Whether you think it's too nice or not nice enough, because it's not your freaking car, it's mine. Shut up. I don't care what you think about what I drive. I'll tell you who does care. My grandkids.

Mm-hmm. Their lives are changed. A godly man leaves an inheritance to his children's children. Try that one on. This is the Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable biblical solution to your healthcare costs? Based on New Testament principles, Christian Healthcare Ministries, or CHM, helps Christian families, churches, and ministries join together as the body of Christ to share their major healthcare costs. Christian Healthcare Ministries is the original health cost-sharing ministry.

A Better Business Bureau-accredited organization, CHM members share to pay each other's medical bills. It's not insurance. It's Christians financially and spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years. And our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Hector's in Atlanta, Georgia. Welcome to the Dave Ramsey Show, Hector's in Atlanta, Georgia.

Welcome to the Dave Ramsey Show, Hector. Hey, Dave. How you doing? Better than I deserve, man. What's up? All right. I just want to say really quick that I'm really grateful for what you do for everybody. I mean, it's been a blessing finding you. Thank you, sir.

And so I'm stationed in Warner Robins in the military. And I'm trying to, after doing financial peace with my wife, obviously I saw the benefits of it, and my wife and myself got on the same page about everything. I mean, it's been amazing. So I definitely want to keep that going. I want to show other people what, you know, what this is all about. And I'm always talking about you, by the way, everywhere I go. Thank you.

People are starting to think I'm crazy. But I try to go through my unit to pay for the Financial Peace University and, you know, several months later, they still haven't done it. And I'm starting to think about paying for it myself. And I guess, what would you do? Check with the chaplaincy. To Financial Peace University, we have a military edition that is taught by, it's taught all over the world in the military, and some different branches have money set aside for those kinds of things,

and some of it runs through the chaplaincy. Some of it you can get the base commander to approve it, those kinds of things. But we're approved by all the different branches, but then you get caught up in the military red tape, like you say, whether you can actually end up getting the money or not. So I would talk to your base chaplain and see what they are doing and talk to the commander and see if you can't get some movement there. But we do have the military version. Get in touch with our military guys here at the office, and they can help you walk through that process. My, you know, the last thing, I mean, it, it, it's an option,

but it's way down on the list that you pay for it for everybody else. I, you know, it might be you just start the class and just invite guys to come and they pay for it. Um, you know, or maybe you agree to pick up part of it just because you care about it or something like that. You can do that.

But I, I would recommend that you spending your money to send everybody else through would be one of my last choices. I would try almost everything else before I did that. I appreciate your heart, Hector. If you hold on, actually, I'll have Kelly pick up, and we'll make sure you get connected to our military team here that works with military all over the world. Aaron is with us in Columbia, South Carolina. Hi, Aaron.

How are you? Hi, Dave. I'm great. I'm a little bit nervous. I might be the first patient you've lost. We'll find out. I doubt it. What's up, man?

My wife and I are in Baby Step 1, and we have two vehicles. The first one we just paid off this past week due to the normal loan term running out. And it also happens to be the same month when it's time to renew our car insurance. And so I'm wondering, since this car has paid off and has a very low value, I've gone out to Kelly Blue Book, and the low ball value is about $1,800, and I think due to physical damage, it's worth even less. The rate difference between including comprehensive and collision on my vehicle and not is about $500 over the six-month period. Really? For an $1,800 car? Between two different insurance companies. And my wife used to work for a PNC agent,

and they quoted really high because they were including all these extras, like medical payments and comprehensive and collision. It ends up being $500 between the two companies of a difference. And I just don't see the need for the comprehensive and collision on my Jeep. No, you don't. Not at $500, if that's really what it is. With a $500 deductible. Yeah, so $1,000 is, you know, the first $1,000 is gone out of your pocket one way or another, right?

Out of the $ so no i think it are you sure the collision only the collision only is 500 difference no no no it's that's that's only part of the premium but with all of it together and the five thousand dollar medical and roadside assistance the premium i'm able to get the difference is 500 but that was the big part of it that was okay yeah so i mean yeah on 1800 car you don't do roadside assistance on an 1800 car you don't do all this other stuff but you do need liability on it and you may want to buy the collision you need to price out the collision completely separate well they won't give it to me the one i quoted they won't give it to me without the comprehensive

so i have to do it separate um the um my van um is still under still on the... They don't sell insurance without the collision? The online progressive quote, when you turn off the comprehensive, it doesn't give you any options to select collision. Okay, go to DaveRamsey.com, click on EOP for PNC, you'll get an independent insurance broker there, and then you can have like an intelligent conversation with a person and find out what's really going on with the insurance on the Jeep.

But, you know, what you've got to do is you're mixing several things together here to make this decision that I don't like. If just the collision alone, just the collision on an $1,800 car makes a $500 difference with a $500 deductible. You would not do that. That doesn't make sense. But I don't think you got those numbers right now that I've talked to you a little bit further. I think you're mixing these things up because you're trying to just look at this convoluted online process that you're dealing with.

So jump online, talk to one of our ELPs, and break it down. I actually had this happen on an old jeep i had a while back that was down at the lake house and it was worth about three grand and the collision on it was substantial and um and i just didn't carry collision on it but i generally the collision is usually worth it in most cases so i just look at at it and I say, what's the value versus the risk I'm taking? And that's what you're doing with insurance. You're transferring risk to someone else. And so, you know, I still carry collision on my cars because when I run the numbers out,

it's worth it to transfer the risk on the car. But you've got to really get solid broken out information to make that determination you've got to have liability on there period i mean in most states that's the law anyway tracy's with us in richmond virginia hi tracy how are you hi dave how are you better than i deserve what's up um my husband and I have two kids, and we are trying to figure out, well, we just found out that we are pregnant with twins. Yay! Yeah, so we are super excited. Is that number three and number four? Number three and number four, yes, sir. So we started Financial Peace back in January. My mom and dad gave it to us for Christmas, and we started out at $35,000 in debt, and we are at $16,000 now.

So we're on a roll. We feel like we're doing really good, but I am having a hard time with whether or not we should stay at home or whether or not I should quit my job and stay at home. What do you make? I make $30,000. What do you make um i make 30,000 what's he make 70 okay um daycare with four kids you're not making a ton after 30 no you're not and that's what that's what we're kind of thinking but um yeah i just i wasn't sure if i should try

and your desire is to stay home i would love to home. And my husband would like for me to stay home too, but I just feel like there's opportunity of growth in my job as well, and I'm torn. The question first and foremost is what does Tracy want to do? The second question is can we afford to do it? And if Tracy wants to stay home with the four kids, then let's start working towards what have we got to do to make that happen. So the twins are going to be delivered when?

We're thinking around Thanksgiving. Okay. All right. And how much progress on the remaining $16,000, if you guys go bananas, can you make on that between now and Thanksgiving? I think we're going to be able to have it paid off by Christmas. Okay. So you're debt-free, and you have $70,000.

If you come home, you're debt-free with the $70,000 income, right? Yes, sir. And we need to build the emergency fund up, and then we need to start investing and moving on. Run your budget out as if you were living only on his check coming home. And look at a budget or two, a pretend budget, a trial budget, right? Okay. As if that was happening today, not counting the $16,000 in debt because it'll be gone.

But run your budget out and get comfortable with that. I think you're coming home because I think you want to, and I think you're going to be able to afford to because of what you've done in the last year paying off all this debt, and you've learned how to handle the money and make it behave. Congratulations. In the lobby of Ramsey Solutions, Kyle and Audrey are with us. Hey, guys, how are you? Hey, Dave, doing well. Welcome, welcome. Where do you guys live?

Kansas City, Missouri. Fun. And all the way to Nashville to do a debt-free screen. That's right. How much have you paid off? About $80,000. Very cool. And how long did that take you?

About 48 months. Good. And your range of long did that take you? About 48 months. Good. And your range of income during that four years? We started about $80,000, and we've got some family and friends listening, so we'll just say somewhere around double that. Okay. All right, $150,000 plus. All right, good.

Good for you guys. Well done. Well done. What kind of debt was the $80,000? No. What wasn't it? A student loan, a car um credit cards uh thought we were smart and doing the interest-free financing on i think so but uh but yeah um

that's about it yeah just about you were normal yeah how long have you two been married coming up on six years six years okay so you've been married a couple of years, and something happens, and you looked up and said, whoa, normal sucks. Yeah. So tell me what happened. Tell me about your journey. What started this plan? I mean, we heard about you. I heard about you in college.

In a class, a guy gave a training on how to get out of student loan debt. And then I heard a relative that had gone through the program and never really put two and two together, but it was when Rachel actually came and spoke at our church. Oh, wow. And they hosted a class at our church afterwards. Which church? Country Club, United Methodist Church. Okay, great.

So we didn't actually go through that class but uh took the class after that and um as i say the rest is history okay cool so how long ago was the was it that you went through the class 48 months or uh that's what started the whole thing beginning of 2013 okay so cool but uh yeah so what do you tell people the key to getting out of debt is? I say having a plan, the determination, and perseverance. Okay. So, Audrey, when the class comes to the church, Rachel's there speaking, which one of you looked at the other one and said, we need to do this? Definitely Kyle.

Kyle looked at you yeah he's been kind of the driving force behind all of this if it were up to him we would have had the debt paid off in a year so oh wow okay he's been patient with me so she's helped me have a life you balance it out because when he goes forward he goes wide open okay very cool i'm the nerd in the relationship if you can't tell got it good it, good. Well, I understand, too, you guys are super coordinators. You're coordinating a class now, right? I've coordinated three classes at our church. Three of them, yeah.

Well, Debbie Powell says thanks to Kyle for his steadfastness and loyalty to his students. And Franck and Bryn Brashe said Kyle's a wonderful leader when he taught Financial Peace University. Not only was he there to facilitate the program, he took extra time to meet with us one-on-one and better understand the world of investments. He genuinely has the heart of a teacher. We appreciated getting to know him and to learn from him. Way to go, Kyle and Audrey. We're proud of you.

That's awesome. You're true role models for what you teach. Thank you. Very cool. Your class members are bragging on you, brother. Yeah, thank you, Dave. Well done. You guys are something else.

So not only have you done this over four years, but you've had quite a few other families been impacted by you leading the class. It's just my way of paying it back. You're my hero. You've changed my life. I'm honored. And you get to sit front row and watch people change their lives. I mean, it's front row seat for life transformation.

It's a blast. Fun. Well, I'm proud of you guys. You're heroes. You're absolutely impressive. Very, very well done. So, Audrey, what was the hardest part of this for you all? For me, it was the budget.

We probably had different things that were hard, but I always struggled with the budget, probably always will. Not something I enjoyed, but i always struggled with the budget probably always will not something i enjoyed but kyle um had grace with me and patience throughout the process so it worked out okay that's good cool cool kyle uh what's the big deal what's the hardest part of this process because i mean four years is a bit of a slog that's hard that's a long time to wear i mean you you guys stuck with it that's impressive yeah um i mean just having a goal in mind and uh like you said slogging through the process it's uh um delaying gratification i know is one of the big things uh you know seeing our

friends travel and everything and we're staying at home. I know that was a struggle for both of us, and just sticking with it sometimes can be a challenge, but just the determination that you're going to achieve the goal. Great job. Great job. And you brought the kiddos with you. We did. For the debt-free screen. And what are their names and ages?

Thomas is two. And Harrison is ten months. Oh, perfect. Okay. All right. Beautiful young family. Way to go. You guys have changed your family tree.

Very proud of you. Well done. Got a copy of Chris Hogan's retire-inspired book for you. That's the next chapter in your story to be millionaires and outrageously generous as you go along. So well done. Kyle and Audrey, Thomas and Harrison, Kansas City, $80,000 paid off in 48 months, making $80,000 to $150,000.

Count it down. Let's hear a debt-free scream. Ready? Three, two, one. We're dead free! You scared the little guy to death. Fabulous. Well done, you guys.

Very, very well done. I love it. I'm so proud of you. Good. Thank you for leading the class, too. Very amazing stuff. Russell is with us in Boise, Idaho. Hisell welcome to the dave ramsey show hello dave hi hey so i just want to let you know that today's probably one of the happiest and most inspired days of my life uh

saturday i went and sold my big stupid truck got 34 000 for it and bought a two thousand dollar clunker to replace it so i'm getting there on on on getting rid of stupid stupid debt and uh you know getting into quality used cars one of these days would be nice wow that's a big move dude congratulations that's hard to sell it's hard to sell the truck, man. It was very hard to stomach. How'd I sell it? No, I said it's very hard to do emotionally. Oh, absolutely hard to do. Hey, so speaking of hard to do emotionally, so my question for you is this. So I'm the oldest of seven kids, and they're talking about changing your family tree, my youngest brother is somebody who struggles a lot financially,

and I've talked to him a lot about your program. I've given him a copy of your book, but I can't seem to quite get him on board. So my question is, how do you inspire those around you to embrace this and to give it a shot, to consider it and to eventually get on board with the program. Well, the biggest problem when it's family is we use the wrong voice. You're dealing with an adult, I assume. How old is your youngest brother? He's 22.

Okay. First baby on the way. Yeah, so he's a young adult. Okay. Yeah. And if you're talking to him about this, you're pretty enthused because you just sold your $34,000 truck. So we know you've drunk the Kool-Aid, right? And so you sound like to him, he hears big brother voice who joined a cult.

That's what he heard and instead what you need to think about is pretend like this was a 22 year old guy that you are not uh kin to that was just a guy you knew at church that was younger than you like that you would use a different voice and a different set of words instead of like wagging your finger at him going, you little twerp, you need to do this stuff. I'm older than you. I'm smarter than you. You didn't say that, but your voice did. And that's what he heard. Instead, you would persuade.

If it was somebody that you did not have as deep a relationship with, you would have to resort to persuasion because you don't have the position in their life. Does that make sense? Right. And so you've got to just talk about not what he's doing wrong or what he should do and condemning him because I'm sure he's doing stupid stuff. He's 22. I mean, I did. And so not all 22-year-olds do, but, you know, you're saying he needs help.

So what I would do instead is just talk about the dumb things that you used to do. I've done some of the dumbest stuff, and when I got on a budget and I quit spending everything, man, it changed everything in my life. It changed my marriage. When I got savings put aside for an emergency fund, it changed this. When I got rid of that truck, I felt like I lost 300 pounds. I felt like I'd lost a big weight off around my neck. And talk about your story and how it's positively impacted you, and he'll probably start asking you questions then.

If you use your big brother voice, you're cooked. Thank you for joining us, America. Robert is in Boise, Idaho. Hey, Robert, how are you? Better than I deserve, Dave. How's it going? Just the same, sir. How can I help? Okay, so here's my situation. I called in for some advice for, like, the next two to four years-ish. And my situation, I just graduated college.

I'm 22 years old, and I start my job next week making $71,000 base pay. And I'm $19,000 in my own personal student loan debt, and then my parents took out additional loans in their name, totaling about another $19,000. No other debt, no credit cards or anything like that. My wife and I have about $12,000 in savings, and my wife also, she's looking for a job as well. She'll probably be making between $30,000 and $40,000.

So I'm trying to figure out what my best course of action is going forward. We also want to buy a house in the next, like, 12 to 24 months, so I'm trying to figure out if all of this is sustainable. Okay. Are you responsible for your parents' loans? I'm not responsible, no, but I feel kind of like an obligation to help them pay for it because, you know, their finances aren't in the best order,

and, you know, me getting this decent job right out of college, I feel like, you know, I'm responsible for that lump of money as well. Did you have an agreement with them one way or the other oh what was that did you have an agreement with them one way or the other no agreement i i what do your parents make a year um it's a basically a single income house i'm guessing about 60 000 okay all right cool but, yeah, they have other expenses in debt as well. Mm-hmm. Okay.

All right. Well, if you want to give your parents $20,000 as a gift, which is what you're discussing here, I would do that after you meet some of your basic financial goals. Okay. But that is not your debt. your basic financial goals. Okay. But that is not your debt. I know. Okay.

But if you want to give them a gift and help them out at some point in your finances, that's fine. But I think you've got some basic things you need to hit first, and that is you need to clean up the existing debt that you two have, hopefully with $100,000 plus income. You can pay that off and use the savings that's there. You can pay that off very, very quickly, right? I'm trying to pay that off. I'm in the grace period, so I'm trying to pay that off before my first payment

so I pay zero interest. Right. Well, you said you had how much in savings? $12,000 roughly. I mean, I have some investments, but like $12,000. What kind of investments do you have? Oh, just like about $2,000 in stocks. Is it in an IRA?

No. Okay. Cash that out and put it on the student loan today and take your $12,000 down to $1,000 and put that on the student loan today, and then you'll be debt-free in about two months. Then you build your emergency fund. Was that the only debt you had? Did I miss something?

No, we've been very fortunate. I bought a car very cheap for my aunt, and then my mother-in-law gifted my wife her car. Okay, so you don't have any other debt other than your $19,000. Well, yeah, no. I have a balance on my credit card right now just because we moved here, but I'm getting – I've got a moving incentive from my employer, so that will be paid off as soon as I get that.

Okay, but you could pay it off too. And then when you get your money back, you could just put the money in the bank. All right. Correct. So, all right, the thing here is this. You have to get your head around the idea that having no debt is the shortest path to wealth. And so every time something comes up, we move here. I'm going to use a credit card. My employer is going to reimburse me, though.

That's not okay. You have to stop that kind of stuff. And every time you get ready to buy something, you have to pay cash for it, from this point forward. Completely avoiding debt is your big deal here. So I want you to clean up the credit card. I want you to clean up your $19,000. Wasn't there something else you told me other than the parents' $19,000? You had something else.

Your wife had something? No other debt at all? No, just that she doesn't have any debt either. I mean, she doesn't have any debt. I think I said that she's looking for a job somewhere between $30,000 and $40,000. Yeah, I heard that. Okay, I guess I'm slipping. Okay, anyway, so I want you to clear up the credit card,

and I want you to clear up your student loan using your income, your $2,000 stock account, and $11,000 of your $12,000 thrown at these things immediately, and cut up the credit card and get a debit card. Then I want you to finish paying off your student loan, because you can't quite do it with that, as fast as you can. And then as soon as you do that, I want you to build an emergency fund of three to six months of expenses. And then and only then do you start saving towards a house.

But you'll be able to buy a house in about a year. When you guys get into the house and you have your emergency fund in place and zero debt and you put a good down payment on the house and you have a house payment that is no more than a fourth of your take-home pay on a 15-year fixed, then before you start investing, if you want to start and reach over and pay off your dad's loans, that's fine. At that point is when you would do that kind of family-type giving. But I want you to get into your house and be debt-free and have your emergency fund in place. And so probably year after next before you pay off dad's loans.

But that's cool if you want to do that. No problems. But they're not your loans, and so I would put them in a different place. It's charity. It's giving. It's generosity. And that's a good thing for you to do all that, but you put that in a different place in your process here.

So that's how I would get after it. Hey, thanks for the call. Open phones at 888-825-5225. Sarah's in West Virginia. Hi, Sarah. How are you? I'm doing great. How are you?

Better than I deserve. What's up? Well, my husband and I have just started listening, and we are in baby step one. We only have $500 saved. We've only been listening for about a month. And an opportunity has possibly arose for us to be moving out of state. And this would give me a $13,000 a year raise. And my husband is worried that if we were to move out of state and be paying a normal rent, that we wouldn't be able to reach Baby Step 2 as quickly or as easily as we would if we were to stay here.

Why? And so, well, we rent from family, and our rent is only $380 a month, which is extremely low, and I think he's worried that if we were to go to someone that's $700 a month or something, then we wouldn't be able, that we would just be in a worse position. Let's just talk about this for just a second, okay? Let's just do some math, okay? $300 a month more in rent is what we're talking about, right? Right. Times 12 is $3,600 a year. $3,600 more in rent. Right. Right. Times 12 is $3,600 a year. $3,600 more in rent.

Right. Right. But you said your raise is $13,000. Mine would be. He would have to find a job down there. What does he make now? He makes about $22,000. Okay.

And what does he do now? We both work for a shelter for special needs foster kids. Okay. And what would he be doing if he went down there? Probably something similar. He really likes to work. What do you make now? I make $21,000.

Okay. All right. So you're going to cut your household income in half but add $13,000 back, so you can't make this move unless he lands a job. Right. If he lands a job at making $22,000 or more, then this is a $13,000 raise minus $3,600 in increase in rent. You come out ahead $10,000, right?

That's what I thought as well. It's kind of math. I mean, it's not a matter of it's not a matter of opinion it's just a math thing now where are you talking about moving to north carolina okay and your family's all in west virginia uh no i have some family down in north carolina which is why we were eventually choosing to where's his family live yes yes. Yes. In West Virginia. Uh-huh. I think we found the real problem.

It's not a math problem. He doesn't want to leave West Virginia. Right. Uh-huh. That's something to talk through. That's not a personal finance issue. That's a where do I want to live issue. And neither one's okay with me.

Both fine places. West Virginia's a great place. So is North Carolina. Wherever you guys want to live issue? And neither one's okay with me. Both fine places. West Virginia's a great place. So is North Carolina. Wherever you guys want to live, just go. But you need to be on the same page about that, and let's not use money arguments to make another argument. How about, I just love West Virginia and I don't want to leave. That's an okay thing to say.

If that's him, that's okay. That puts this hour of the Dave Ramsey Show in the books. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. If you would like to do your debt-free scream live on the show, make sure you visit DaveRamsey.com slash show and register. We would love for you to come to National and tell Dave your story.