The Ramsey Show - App - You’re Playing With a Barrel Full of Snakes for $3,000! (Hour 1)

Episode Date: August 3, 2023

Dave Ramsey & Jade Warshaw answer your questions and discuss:   EveryDollar, budget for the life you want today for free: Click Here Get John's new book, Building a Non-Anxious Life, "Should I take out student loans to invest in the market?" from the blog: Check out the Ramsey Student Loan Hub for tips, tools, and the fastest way to pay off your student loans, "How do I talk to my friend about his terrible money habits?" "How do I buy a car without debt?" from the blog: The Truth About Financing a Car Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Enter The Ramsey Cash Giveaway for a chance to win $3,000! https://bit.ly/TRSCashGiveaway Want a plan for your money? Find out where to start: Click Here Listen to all The Ramsey Network podcasts: Click Here Interested in advertising on The Ramsey Show? Click Here Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the pods of Moving and Storage Studios, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Open phones, Jade Warshaw, Ram ramsey personality is my co-host today the phone number is 888-825-5225 we are breaking all records in ramsey publishing this week with the uh launch of the pre-sale of dr john deloney's new book building a non-anxious life apparently there's a need yeah man people i'm joining you guys too

today just for a segment here talk about the book but yeah that's evidently we are an anxious stressed burned out culture man we knew this statistically the stats were telling us that the statistics of despair they're called are really in bad shape yeah and have been declining since well before covid and covid kind of put on the accelerator and highlighted it was there's problems out there yeah and it it's uh they're actually called the diseases of despair when you kind of back out and look at the resources we have in our culture and the wealth we have in our culture and just the technology and brilliance there's really no reason why people are dying younger and why people are more lonely than ever and why marriages are falling apart and why the suicide rate is up and so digging into this why depression is up why everybody is just rattled with anxiety and so yeah this book was just a

hey what we're doing is not working let's let look at this a different way. We did a chapter book with John a couple of years ago. We call them quick reads, 37 pages called Redefining Anxiety. It blew up 150,000 copies out of the gate with no promotion. And the whole idea of that book is woven into building a non anxious life because part of building an anxious life, really almost the first thing you have to do is you have to grasp what anxiety is and what it isn't that's exactly right and the narrative we've been given is it's it's a genetic disorder like we talked about yesterday it's something wrong with you you're broken and we got to fix what's broken and really what anxiety is it's just an alarm system man letting you know that you are not all right you're not okay and so really you got to back out of that thing and say okay not let's just pull the batteries out of the alarm but where's my house on fire

where's the fire let's put that fire out well and like you quoted one author that said anxiety is actually good because it's telling you something's wrong yeah uh wendy suzuki says dr suzuki says anxiety is a friend it's trying to get your attention and let you know things aren't okay yeah and uh it it it especially applies to this this conversation we have on this show on the ramsey show if you owe money you've been saying this for 30 years financial peace if you owe somebody money your your frontal lobe the part of your brain is designed for for complex thinking and for projecting into the future, it can convince you that that 0% financing for seven years on that depreciating asset, you got a good deal.

And mathematically, maybe you actually did get a good deal. The part of your brain that's designed to keep you alive knows if you say one wrong thing at work, you're fired, you lose your car, you lose your house, you lose your food. And so when you owe money, your body will not let you have rest. And we call that anxiety. We call that burnout. We call that chronic stress. But that's just one example of the way our culture has just said, here's the new way to do life, forgetting that, as Bessel van der Kolk says, the body keeps the score. The body will let you know that what we're doing is not right. What I love about this book is you've broken it down into things that we can do each day. Right.

This is a lifestyle from here on out after we read this book. Right. Yeah. And it's frustrating. Treat the problems, not the symptoms. That's right. And it's frustrating. There's my buddy Lane Norton says, there's never a workout you can do on a Monday that's

so great that you don't have to work out for the rest of the week or the rest of the month right staying in shape being healthy it's just a thing you got to do every day there's never one meal like one salad you can eat that's so great that just buys you dunkin donuts for the rest of the month right and so um similarly with anxiety i know dave's like no no yes if. Yes, if you find it, tell me about it. Have a salad at lunch. So when it comes to living a non-anxious life, it's a way you got to live. You got to choose reality.

You got to choose freedom. You got to choose friendship and connection. You got to choose to heal. You got to choose to believe in something bigger than yourself. And so there's just these choices you can make on a daily basis, a monthly basis, and a yearly basis that are going to transform your life. If you want to discover the six daily choices that will help you move towards, one of them is getting your financial act together, okay? They help you move towards having a non-anxious life, removing the things that are causing anxiety. In other words,

filling up your tank, things like quality relationships, getting your finances in control. It's kind of common sense stuff, biblical stuff. It's really not rocket science. It's written in a way that you can reach the shelf this book is on. I promise you, okay? So it's right there where the cookies are. You can get it. So, hey, check it out.

It's a $20 book. If you buy it in presale, it actually comes out October 3rd. It went on presale this week. If you buy it in presale, we're going to bribe you to buy it early and give you $75 worth of extra goodies, including the audio book and the ebook. And they'll come out with the book. But in the meantime, instant access to Dr. John Deloney's newest talk, smoke, fire, and freedom that breaks down some of the mythology.

And so be sure and check this out. It's all at RamseySolutions.com, RamseySolutions.com. The new book is Building a Non-Anxious Life by Dr. John Deloney. His last one, Own Your Past, Change Your Future, was the number one bestseller. Again, the little quick read was a massive blowup. So this one will be as well, without a doubt, just because we're helping people with an area that they really need help with. It's not it's not something we dreamed up. It's something we recognized.

Yeah. And I want to call out something you said a minute ago. I spent my last 20 years of my life reading academic journals, talking with scientists and brilliant minds. This book isn't for them this book is for people who don't read books and who want a better life this is a book for people who are tired of being talked down at told that they're stupid told that they're dumb that they have a disease that they're that they're broken yeah there's some kind of malfunction this book is for somebody who um wants a clear simple way to change their life right change change the

the the culture and the warmth inside their home right yeah and i said this yesterday and i want to say it again this book's for everyone whether you think that you've you might be sitting there going you know i've got my mental health in order i'm doing pretty good i was a person who thought man i'm not really anxious i i'm good i read your book all of them redefining anxiety own your past will defuse you this one and i'm like i'm going starting on this one and i'm like everybody needs this well it will help everyone everyone that doesn't need a little more peace raise your hand and uh those of you that you know that raise your hand uh how long have you had a problem with lying i mean mean, the joke is either you're

struggling with this or you're married to somebody who is. So it's in your house. It's somewhere. You just walk past someone, I promise you. So yeah. And here's the thing. If you have a broken part of your life, that's causing anxiety, taking a pill won't make it go away. Right. And the people that think taking a pill makes everything go away are not going to like this book. Well, in Medicaid, I talk about my journey with medication. What medication does is it turns the alarms down and allows you to go do the work that you need to do. So medication, not all medication is bad. We're not saying that.

But it doesn't make you not anxious forever. It doesn't solve the problem. It allows you to get in there and do the work that you need to do. The spark plugs are not, well, the fuel injectors are not. Yeah. If you're not interested in doing the work, kind of like getting out of debt. If you're waiting for Washington to come save you, it's not the book for you. If you are ready to take control of your life back, this is the book for you.

Building a non-anxious life. Dr. John Deloney at RamseySolutions.com. 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 harder than ever to get anything approved through the bureaucracy. So, if you feel like the system is working against you, try a biblically-based alternative to health insurance, Christian Healthcare Ministries. CHM is a health cost-sharing ministry that's helped hundreds of thousands of families like yours take care of over $11

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That's chministries.org slash budget. Jade Warshaw, Ramsey Personality, is my co-host today. Peter is with us in Canada. Hi, Peter. Welcome to The Ramsey Show. Hi. Thanks for taking my call. Sure. What's up? So, I'm

currently entering my third year of university. I'm married. Me and my wife have been very financially independent. We're both in school. We both foresee being able to pay off for our school just through hard-earned cash while doing summer jobs. Wonderful.

But we've been doing them. We've been kind of realizing, you know, that the student loan rate in Canada, we don't have interest on our student loans, and we don't start paying until six months after we graduate. And so we were wondering, we were thinking about maximizing out the student loans we can take out and putting it aside in a separate high interest savings account, maybe even invest into some short-term bonds. And then when we graduate, take all that money out, pay off our student loans in full, and then, you and then keep the money that we made from the interest.

My question is, I know that you're very adamant about staying out of debt if possible. I'm just very adamant about staying out of debt. Not if possible. I'm just adamant about staying out of debt, period. Right. But let's go ahead. How much are you talking about doing? How much money?

Me, so about $15,000 a year for me and my wife. So that's about $30,000 each. So $60,000. Yeah. Okay. And the bond rate is what? It's about 5.5%. Okay.

So $3,000. That's what you're going to make? Yeah, per year. That's what you're going to make, $3,000. And what's your degree in? Finance. Finance? Yeah.

Okay. Uh, finance. Finance? Yeah. Okay. Um, and you're in your third year of finance degree? No, I'm just doing Bachelor of Commerce currently, uh, majoring, uh, um, majoring in finance. Yeah. Going into my third. Um, have, have you ever had a statistics class yet not yet not yet okay i can tell okay um go ahead dave um so here's what you're missing risk the only way your program works is if there is a zero-risk scenario, which does not exist.

Okay? So the problem is you call the guy that's been doing this for 35 years, so I've seen everybody do every possible stupid butt thing they can do in their lives or have horrible tragedies happen to them in their lives that you have not anticipated. Or, oh, maybe the bond market has a problem that's never happened has of course that happens all the time and so maybe you don't make three thousand and uh maybe oh have you did you know that bonds go down in value when interest rates go up you know it's an inverse relationship? Yeah.

Yeah. And so you're going to take out a $60,000 loan with $60,000 worth of bonds. Interest rates go up. Now your bonds are worth $50,000, but you have to repay $60,000. You know values go down when interest rates go up. It's an inverse relationship with the bond market to interest rates, and we're in a rising interest rate environment, aren't we? That's called risk, okay?

So your plan is... Not good. It's left out key components, which makes it really, really risky risky and naive that's problem number one with it problem number two with it is you are trying to make money doing nothing making money doing nothing usually will cause you problems so don't try to make money doing nothing problem number three is i'm pretty sure'm not positive, but I'm just about positive, that the government of Canada did not come up with a student loan program for Peter to invest in the bond market.

Meaning that you are misusing these funds, which is not illegal, but it is at a minimum unethical or immoral. I agree with that. So lots of reasons, Peter, to not do this. Lots of reasons. You do not anticipate risk. Another way that you can, if you're ever faced with something like this again, that help you feel the risk is just take your proposed scenario and multiply it like 10 or 100x and see if it doesn't make you want to throw up a little bit.

That's so good. Then you really see the gravity of it. So in other words, would you do this with $600,000 if you could do it? Would you do this with $6 million if you could do it? Oh, no. So now you're starting to feel like, oh, God, something could go wrong. Well, if something could go wrong, well, dude, something could go wrong. And let me just tell you, it's not something could. It well dude something could go wrong and let me just tell

you it's not something could it's pretty likely to absolutely it's pretty likely to so um yeah it's just um and all for three grand that's my thing it's not even a lot of money go deliver some pizzas and get you some three grand for a year yeah yeah that's just not a lot yeah it's not you are playing with a barrel full of snakes for three grand hoping to not get bit so um there's the problems with your theory and because your theory is empty it's missing entire sets of variables that when implemented make this really unattractive and you forgot the ethics and the morals part of it too, which will also lead you astray and get you into problems. So Dave, that was good.

I was expecting you to really go into one of your Dave modes. Well, you taught, you taught. The thing is, it wouldn't have been fair to him. That's true. Yeah, no, you taught. So he had to, because he doesn't know and he didn't call up with an arrogance he was asking an honest question and he just didn't know so it wouldn't have been fair to him to kill him um as tempting as it might

have been i was i was i was giving you the energy yeah i know you were i felt it i felt you agging me on it's almost as bad as when Sharon does that. Oh, my gosh. No, I mean, he's a good guy. He just hadn't thought about some of the stuff because he's young. And I'm glad he called in because I know a lot of people have fooled around with that idea in different types of way, basically taking debt to invest it. So for those of you over in the nerd side whose head are still spinning, the reason I ask about statistics class was not to be sarcastic but um in stat one the first class you take they will teach you uh a measure of risk called a beta and a beta is the the distance between the hill and the valley if you look at a graph and it's going up and down like a mountain in a valley the distance between the bottom and

the top is your beta okay so and and so in an investment analysis a beta is your measure of risk and so for those of you out there doing your investments you'll see it actually it's one of the people you actually do see it in the real world other than stack class is with mutual funds so a in the in the united, the standard and poor, the S&P 500, is the measure, the baseline of the stock market. It is a 1.0 beta. So it's your baseline. Okay. So if you have a mutual fund that has a 0.8 less stock mutual fund might have a 2.0 beta, which means it's twice as volatile as the S&P baseline.

Okay. The standard and poor baseline. So you see it there. But what happens is people do not apply that type of mathematical thinking and formula, which that's an actual math measure of risk. People don't apply that to debt. And so he left risk out of his math formula. Yeah, he did. So he's thinking, okay, I'm going to make $3,000 on $60,000, but I did not adjust my

returns for risk. And that's why I was asking about that, because you adjust it for risk. And this is really an egghead explanation of why God says in the Bible that the borrower is slave to the lender. Slaves don't have choices. Slaves are seldom generous. So slaves lose their personhood. And this is what happens when you step into the noose of debt because you haven't measured risk adequately.

Very good. So this is, you know, you look at it through a biblical lens, a spiritual lens, the lens of faith. We can look at it through the academic lens. We can look at it through grandma's common sense. Grandpa says, son, you bought that car? You did what? That was my grandpa. Drove up in a new Jaguar.

I was a millionaire. My grandpa looked at me like I'd lost my mind. He goes, 10 years, what's that car going to be worth? And I said, not as much. And he said, well, I call my investments things that go up. Look at that. Grandpa was right. This is The Ramsey Show. jade warshall ramsey personality is my co-host today in the lobby of ramsey solutions on the

debt free stage carrie and liz are with us hey guys how are you how you doing dave welcome welcome good to have you where do you live kansas city all right fun welcome to nashville and how much debt have you guys paid off? $424,800. Love it. Very good. And how long did this take? Three and a half years. All right.

Good for you. And your range of income during that time? Anywhere from $230,000 combined to $350,000. Yeah, you guys are killing it. What do you all do for a living? I'm a neonatal nurse practitioner. Oh, there's that. Okay.

And I'm a project director for a general contractor. So, okay. I was going to guess house, but now I'm going toatal nurse practitioner. Oh, there's that. Okay. And I'm a project director for a general contractor. So, okay. I was going to guess house, but now I'm going to guess student loans. Yes. Amazing. A neonatal nurse practitioner. Wow. What a cool job.

I mean, wow. What a neat thing you do every day and how expensive to get that degree, right? Yes. All of the above. Yeah. All of the above. Yeah. All of the above. Wow. So that was the house as well.

Ooh. How does it break down? It was the house. Oh, okay. Cool. Congratulations. I'm looking at where people. All right.

What's the house worth? About 530. Way to go. And how much of the 425 was a house? 340. Oh, so it really wasn't that much student loans. Okay. $85,000 was the student loans.

Okay. Not doctor-level student loans anyway. Okay. Good. Good for you. That's pretty close. I mean, $85,000, not $385,000. Okay.

Good. Good. Way to go, guys. Congratulations. Man, that's got to feel great. It does. The student loans, the house, everything gone. Yep.

All gone. that's great my thing is like you've got these great incomes but you clearly did not let yourself have that lifestyle in order to pay this debt off yeah that was a goal of ours for sure what what was what started all of this three and a half years ago so about three and and a half, four years ago, my Aunt Kim, she went through the journey as well, and she gave us a free sample of the Total Money Makeover. So we listened to that and went home, and that night I couldn't sleep, so I ended up paying off like $2,000 in credit cards,

like three grand in my car at the the time and then we just kept that momentum going oh wait a minute when liz woke up you've been up at the computer doing this that's what i'm thinking so actually a little bit of our history here um why don't you go ahead okay um i was widowed in 2018 um and so i was in the middle of school. I graduated in 2019. But prior to Carrie and I went to college together with my late husband. So they were actually like best friends. So when Matt passed away in 2018, I was lucky enough to have a term life insurance policy through my employer for $200,000. So then when I graduated in 2019, I actually put that money and paid off my $85,000 in student loans using that money and then invested the rest of that. So my daughter, Sylvie, is here today and

she's Matt and I's daughter and Carrie is going to be adopting her here within the next month. Wow, that's wonderful. Yeah, it's a really cool story. That is a great story. We have a lot of history together, but definitely always been on the same page as far as what we wanted our legacy to be for our family so yeah well you're you're uh i mean with that tragedy you obviously had a complete reset emotionally and you don't have a choice but to uh make serious things serious yeah after that and so we're gonna clean this mess up this serious it's not this is not a couple of

children trying to figure out what i'm gonna do with the candy yeah this is all of a sudden real serious and so so what happened to Matt um he was unfortunate it was a tragic death but um he was a professional athlete for many years and unfortunately um became addicted to opioids and so it was a long road um and you know for a long time we couldn't talk about it it was kind of like the elephant in the room, but I'm at a point in my life now where it's a part of my story. It's a part of our story. It's a part of Sylvie's story. And overcoming the whole process.

Yeah, definitely. And so he was a wonderful, wonderful person, and I like to remember him for absolutely for all of the good things and um you know it is he left me with her and wonderful memories and so for that we're very grateful amen amen incredible so then the two of you get married three and a half years we've been tearing into this debt way to go a couple of heroes coming the other side of that tragedy and gonna we're gonna make something beautiful out of this whole thing way Way to go. Good work. What do you tell people the key to getting out of debt is?

Definitely having a plan. We were both very fortunate growing up to have our parents kind of instill savings and being intentional. But really, again, when we started listening to the show three and a half years ago, uh, kind of gave us a plan to, and gave us the ability to start setting goals and realizing what, what we need to accomplish there. And just, uh, since we've been married, you know, even prior to that, just being on the same team, life throws a lot of challenges at you, but if you can stick together, you can, you can get through it also. Amen. That's a word. So you've got no debt in the world, not a house payment, nothing. Yeah.

What's next? What's next on the horizon? Are you going on a trip? You've got to go do something fun. Are you going to do something? So we got married last October. Okay. And we held off on the honeymoon a little bit.

We just got back from South Africa. Wow. So we did that for a week, and then we did the Seychelles. Nice. Nice. So that was kind of the honeymoon slash debt-free. That is great. So we cash flowed our not very cheap honeymoon.

So that was part of our plan and we achieved it. We saved up money as we went along and, you know, we paid our wedding off before it even happened. So that was also, you know, not in our debt at all. That was a big goal of ours as well. So everything that we say we're going to do together, we do. So just making sure you're on the same team. I'm making 350 now, not a debt in the world, not a house or anything. Way to go. Congratulations. Thank you. You are amazing. Wow. And what over what the stuff you've come through and overcome and

it's just a process man it's very beautiful very well done absolutely very cool all right let's bring sylvie up how old is sylvie she's six did i say her name correctly you did yes all right she's so cute she is beautiful yeah oh what a blessed kid this is awesome yeah are you ready her life is absolutely changed hey we've got the uh live and give box for you which includes the baby steps millionaires book if you're not there you will be shortly with these numbers and the total money makeover book for you to give and get somebody started like you said somebody loans you the total money makeover and the financial peace university membership again use it or give it away. Congratulations, you guys. You're amazing.

Thank you. What a beautiful thing you've done. I'm so proud of you. Heroes. Well done, well done. All right, Carrie and Liz and Sylvie. Kansas City, $425,000 paid off in three and a half years, making $230,000 to $350,000.

Count it down. Let's hear a debt-free scream three two one we're debt-free wow wow just in case uh you are facing the most unbelievable tragedy of your life today, you can look at them and say four years, five years, the other side of it. Look at what is here. I mean, my goodness gracious. So, you know, the sun will come out tomorrow. That's right.

Several takeaways from that story. Several. Very good. Hope. Yes. In so many ways. Because, I mean, when you go through something like that, it's hard to believe it's ever going to get better that's right when you're in the middle of

it and boy what a beautiful gorgeous outcome yeah i mean just fabulous and just i mean a power couple the future is so bright for them they've got so much going there's so many things they can do there and all because they said okay we're going to be very intentional. We're going to have a plan. We're going to be on the same page. We're going to work a plan. And they didn't give any different answers than a lot of debt-free screamers give. But boy, they did some big numbers.

Well, and you can tell they have an immense confidence in each other. And the ability of when they both say, we're going to do this, like she said, they do it. Yeah. You can see it in the body language. You can. Yeah. That's very cool. Powerful.

Rock stars. Heroes. Well done. This is The Ramsey Show. Jade Walsh, all Ramsey personality, is my co-host. The Ramsey Show Question of the Day is brought to you by Neighborly, your hub for home services. Neighborly is the place to find reliable help for your home from trusted, locally owned businesses like Mr. Appliance, Mr. Handyman, and Precision Garage Door Service. Visit Neighborly.com today to find home experts available to serve you.

Today's question comes from Peter in Alabama. I have a question about one of my best friends. I love him and his family to death, but his financial management is beyond horrible. And it hurts me to watch someone I care about so much make idiotic mistakes and dig himself into a hole that only gets deeper as time goes on. He is not one to ever talk about money, but I know for a fact that he is dealing with a big student loan and credit card debt. I would love to help him and turn him over to your show and the baby steps, but I also fear he won't respond positively to unsolicited financial advice. My question to you is, how would you approach this kind of situation you know these situations they're some of it depends on the

relationship obviously like I've got there's certain buddies of mine that I'd be like look I'm older than you I know what I'm talking about then there's situations where I'd I probably wouldn't say a whole lot I'd probably just lead by example and hey this is what I'm doing and hopefully they catch on and then there's those times where you do bring up the conversation, but it's not in like a, here's what you need to do. Dude, you've been messing up, man. Like, you don't know what you're doing. Trust me. Listen to Dave. Like, that's not the way to do it. What you can do is say, you know, I remember when I had a time that I remember when I had credit card debt. Remember when I had that $30,000? There it is. It was crazy. And what and what I did I found this guy he's on YouTube he has this book I started reading the

book and I was blown away exactly don't talk about him at all yeah just talk about you and talk about back when you were stupid because we all we all can go back there some of us it was 20 minutes ago some of us it was 20 years ago but we all can go back to stupid and go, I remember when I had a big student loan, how scared I was. I remember how I felt like I would never get out of it. I remember those feelings. Man, I tell you what. And, man, I used to fight people. I would argue with people about credit card points.

I thought you're going to get rich using credit card points. How dumb I was. I can't believe how stupid I was. And you know what? I found some new information. and you know what i i found some new information and you know what i did i worked my butt off and worked this plan that this guy on the radio these these people on the radio at ramsey they talk about and i got out of debt and man oh you don't believe i can sleep better right i might i feel like i got a 300 pound man off the off of my chest right you know he was standing on there

I mean and I feel so much better and just talk about you and he'll he may just look at you like you have one eye he might or he might look at you and say wow that's pretty cool who'd you say that podcast was yeah that may be what he does because he's he's probably not going to say hey man help me do my budget no he's probably not going to say hey man help me do my budget no he's probably not going to go completely over to the side but you just tell him about you you got to talk about it like you would if you if you had a restaurant you loved or a netflix show that you loved you wouldn't go to your buddy and be like everything you're eating is wrong and all the shows you like suck watch mine you wouldn't do that you say, I'm looking at this show.

I love it. Yeah, it's great. It's so good. It's so entertaining. Like, you got to talk about it like that. That way you're never pointing that finger in their face. And you're not telling them anything bad about themselves. Yeah, exactly.

Just share your experience. Because really no one can argue with your experience. That's right. I mean, this is what happened to me. I don't know what happened to me. But this is what happened to me i don't know what happened but this is what happened to me and you really and my old pastor used to say used to say a man with an experience is not at the mercy of a man with an opinion facts but you can't come across condescending let me put that out there it's not it's not it's just it's not like i'm better than you it's just like god man you know yeah i used to eat 63 donuts and i quit and i feel

so much better now that i'm not so stinking fat. I got more energy. I do. It's true. And so I got more energy. My wife likes me better. Life is good. So I'm just recommending.

I'm just saying my life is good. So if you come to me and say, Jade, I used to eat 65 donuts every day. I feel great. What is it? I used to. Are you giving me a hint? No, not you at all. I wasn't saying that to you i'm just saying i'm just saying that to america merica merica josh josh get us out of this josh is in bristol hey josh how are you i'm good how are you day better than we deserve sir how can we help

yeah um before i start i just want to say god God bless you all guys and thank you so much. I've been watching a lot of your videos here recently and I'm working on the baby steps. Well, thank you, sir. We're honored to have you in the audience. How can we help today? Me and my wife are halfway doing baby step one

and I had a car problem. I got my car paid off a year ago, but it blew up, and I need a new vehicle, but I don't have the cash to just buy one, and I'm going to try, well, and I'm becoming very anti-debt, too, but the only way I know how to do that is get a small car loan under 10 000 preferably seven you don't have any money uh nothing saved up okay what's the car the car you were driving what was it worth before it blew up i don't know the county's blue book it was a 2007 toyota camry okay so what would you think it was worth what would you guess I don't know the county's blue book. It was a 2007 Toyota Camry.

Okay. So what would you think it was worth? What would you guess? I think I could probably sell it for around $3,000. Before it blew up? Before it blew up. Yes, sir. Okay.

All right. So there's no need to get a $7,000 car. Then you were driving a three before this happened. Right. Okay. So we could buy a $3,000 car and break even. Let's start with that. What's your household income?

After our tithe, a month, we bring in $4,411. Okay, good. And how much is your rent? We don't have rent or mortgage. My wife inherited her house by her grandfather who passed away a few years ago. That's good news. And both of you work outside the home?

Yes, sir. Okay. And you currently have one car that's running, right? Yeah, it's on loan. It's my wife's truck. We pay $475 a month for it. Okay. truck it's uh we pay 475 a month for it okay so it's got a loan on it but you own you own one other car a 500 car payment on a four thousand dollar take-home pay ouch that's no fun um and uh you don't uh you don't own another car right you don't own a third car do you

no sir okay what's your tractor worth i don't know what's your lawnmower worth this is gonna be real embarrassing i don't have a lawnmower okay it's not it's not embarrassing what would be embarrassing is if you told me you had a seven thousand dollar zero turn that would be embarrassing okay because i'd be selling it to buy you a car okay so you're doing good josh you're passing the test so far you got a lot of common sense i'm just looking around here because sometimes sometimes i just got married five months ago okay good very good so you married this car payment okay okay um what do you do for a living? I'm a housekeeper at a university.

Okay. And my wife's a welder at a factory. Excellent. Excellent. Okay. All right. So your car with the blown engine will probably bring 1,500 at the salvage yard, maybe more.

I hope so. That would be a lot more than I was thinking. Yeah, 1,000 to1,500 it'll bring. Or some old boy will give you that because he's going to put an engine in it, okay? Okay. I don't want you to put an engine in it. You don't fix $3,000 cars. Those are throwaway cars, okay?

Right. So I'll tell you, you can go the route you wanted to go, but I wouldn't recommend it. And you're brand new to our stuff so our stuff can sometimes feel awfully extreme but one of the things i found is if i'm going to break a series of bad habits or principles in my life i have to adopt the extreme to complete the transformation in my heart okay so when we went broke josh i drove a borrowed car for four months i'm not suggesting you have a car you can borrow but i'm just telling you how what i did okay what i did was i drove a 1978 cadillac with 478 000 actual miles on it the predominant color was bondo and the vinyl roof was

torn loose across the front so when you drove it it filled up with air and looked like a parachute on a bondo buggy it was the most embarrassing hillbilly car you can think of and i drove that car for three months one 10 year period what it felt like 10 years it felt like 10 years and it was only three months but buddy i saved some money during that three months because i'm getting rid of bondo buggy right highly motivated that's what i was so i'm going to suggest you do something weird like that. Like let's sell this car for $1,500 and go buy a $1,500 car that runs and drive it for four months. And during that four months, oh, you can buy it. It's a garage sale car. It's ugly.

It's got a hail dents in it, but it runs. All you want is something that runs. You get it at a garage sale. That's where you get it. You got to air the tires up. And you drive that car for four months. Hey, what's up, guys? It's Jade. Look, if you like what you heard in this episode and want to know more about getting started on the Ramsey baby steps, go to ramseysolutions.com and click the Get Started button. We'll help you figure out the best next step for you based on your specific situation. That's ramseysolutions.com and click Get Started.