The Ramsey Show - Are You Ready to Find Freedom With Your Money For The First Time?

Episode Date: March 20, 2024

💵 Sign-up for EveryDollar today - The simplest way to budget for your life! Dr. John Delony & Rachel Cruze answer your questions and discuss: "Should we keep investing while paying off debt?" "How can I convince my partner to marry me?" "I'm upside down on my car," "My husband wants to give his son a house against my wishes..." "My husband loves your show but won't slow down and take one step at a time - how do I get him to slow down?" How to know if you have too much life insurance and what it looks like to become self-insured "Our neighbors yell at us for parking on the street - are we making an emotional decision by selling our house?" "My son was making payments to me for a car he totaled - how can I let this be a lesson without it being a burden?" "My mom changed her will but it will leave my sister homeless and I don't know what to do about it" Support Our Sponsors: Zander Insurance BetterHelp NetSuite Next Steps 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 🏦 Take Your 3-Minute Money Assessment - Get a personalized money plan! 📊 Dave Ramsey's personal playbook on investing and real estate. 🏠 Find a Ramsey Trusted Real Estate Agent Listen to more from Ramsey Network 🎙️ The Ramsey Show   🧠 The Dr. John Delony Show 🍸 Smart Money Happy Hour 💡 The Rachel Cruze Show 💸 The Ramsey Show Highlights 💰 George Kamel 💼 The Ken Coleman Show 📈 EntreLeadership Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Девочка-пай Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people with their money, their work, and their relationships. Whether it's friends, romantic, whatever you got going on in your life, we are here to help. I'm John Deloney, joined by my great friend Rachel Cruz, and we're here to take your calls on

just about anything. 888-825- 5225. 888-825- 5225. Let's go out to Johnny 5 in Phoenix, Arizona. Hey, Johnny, what's up? How you doing today? I'm good, man. How about you?

Not too bad. Outstanding. What's up? All right. So I'm going through the baby steps and I'm looking to maybe kind of work them around. Basically, my income is about $82,000 to $82,000, and I just paid off about $25,000 worth of personal debt, and it freed up about $3,700 a month. And I wanted to find out that I have about $16,000 worth of credit card debt, and I have it targeted to have those paid off in about three to four months. And it still leaves me with that 15% that I could apply to it. And I was wanting to find out, one, is it okay to invest that? Or should I take that 1242 and still attack credit cards? Or could I turn around and still start the investing as I'm attacking the credit card debt? How old are you, Johnny? I'm 47. And that's, I think that's the call to action. Well, yeah. Well, I was just curious, yeah, where you were, because here's the deal. I mean,

how much, how much interest are you paying on those credit cards? Combined, I mean, it kind of varies and stuff, but half of them, there's probably about 10 of them that I have, and the most expensive or the most debt that I have on one of them, I think it's like $3,500. No, but what's the interest you're paying? Yeah, what are you paying on those? You know what?

I really haven't calculated it, but if I had to guess, the average ones are probably close to 18, 19 percent. 20 percent. Yeah, that's what I was probably going to guess. Because here's the deal. The baby steps are in order for a reason and you're going to have opportunity costs on either side, but you're going to come out better when you eliminate debts. You're not paying that extra interest of 20, some of the credit cards up to 22%. I mean, it's wild, the interest rate right now. And so what you're doing is you're eliminating that,

not just the fact that it's debt and it's risk, but also from the mathematical standpoint, so much interest that's paying out versus, and then once you pay all of that, then to press play and go and invest. And then on average 10, 11% that you'll all of that, then to press play and go and invest. And then, you know, on average, 10, 11% that you'll gain. But you'll be able to invest more and more consistently without having these credit cards.

So without a shadow of a doubt, Johnny, even with your age, it is still the answer of yes, take that extra cash, pay it off quickly, and stop, yeah, playing the credit card game. I mean, have you eliminated and cut up and gotten rid of the 10 credit cards? Yeah, essentially, I committed plastic surgery. Good, yes, yes. Yeah, that's awesome. And again, I know it can feel unnerving not to be saving for your future

and having retirement there, but here's the deal. You're gonna be able to knock these credit cards out so quickly, like with your income and everything. everything and like you said like the biggest one's like $3,500 or whatever it is so it's like being able just to have that motivation and paying off those smallest ones and getting them out and then that frees up so much just space financially with margin but also space emotionally just to know that you don't have that risk. I want that to haunt you, that you're 47 and you're not putting money into retirement because you're still cleaning up old mess. Let that be the jet fuel that gets that nonsense out of your life quick.

100%, yeah. You know, and that's what I've done. I've already paid off like two of them. And, you know, I know that they compile interest interest and so I'm trying to compile my payments. So I took the smallest one, um, or essentially the smallest two paid them off. And then I'm just attacking them. I actually have them labeled, uh, one through 12 or one through 10, whatever they are. And so, and I just plan on doing it. And then every time that I pay something off, you know, if it was a $100 that I paid towards that card that I paid off, I would put it towards the next one up.

And so I've been compiling the payments in that aspect. But I'm still sitting here looking at this extra money, and I'm like, gosh, why can't I just go ahead and start investing it? What's your next biggest credit card that you have to pay off? Next one is going to be $2295 pay it off right now right now okay by the end of this show you should have that one knocked out because you got 30 something hundred you got 30 what 500 dollars burning a hole in your pocket pay that next debt off now you now you just knocked one out now you only have a few you have nine left right you should

keep knocking them out right get. Get them done, man. For sure, for sure. And then, you know, I've got two houses right now. My one house is paid off that I live in, and then I have a rental that actually brings in some passive income. Well, you're passively going broke, too. Sell that house. Can you afford it? Oh, yeah, hands down.

The payment's like $450 a month. I bought it as a foreclosure, and then I paid like $45,000 for it. It's a stick built on a little lot in a rural area, and I've had renters in it for five years now, six years. And how much total debt do you have, Johnny, not including that extra house? Not including the house. I drove a well and I got some personal loans and I got those paid off. In fact, I just paid off $6,000 yesterday. But my monthly bills... No, no, not monthly bills. Yeah, just in general and all of it. Is it just the credit cards left? Was it $16,000 you said?

Yeah, that's it. And that's it, okay. And then the $3,500 a month is what all my bills are, my electric, all that. Okay. And any savings? Yeah, about $15,000. $15,000 in savings? Yeah. Okay.

It could be more, but... I would... No, dude. Johnny, Johnny. I mean, honestly, what I would do is... because with the baby steps, again, it's you have a thousand dollar emergency fund and then you take everything else. So honestly, Johnny, you could be almost debt free by the end of today. And that's what I would do.

I would go down to a thousand dollars, pay everything off, and then start saving that back up. And then that changes. It's out of order. I feel like what you're doing. You're all over the place. Everything all at once. So yeah.

I've been kind of shuffling it a little bit. Yeah. I mean, you have great progress because I'm like you, you have, you're making great money. You know, you're able, you're, you're motivated to do stuff, which is great. I just think just tilting that motivation and going in one direction versus trying to do 18 different things is going to help you see more progress and feel more secure. So if you hold on the line, Austin's going to pick up and we'll throw in a copy of Total Money Makeover, which is Dave's bestselling book. But it walks you

through very simply the baby steps. I mean, you could read it in one night. But honestly, Johnny, just do these things in order. And you have the motivation and you have the cash coming in. Like it's there. It's all there. The pieces are just doing them together by getting out of debt, building up an emergency fund, then investing in retirement. Do it in that order. And you're going to do great. You're going to do awesome. And pay that house off soon. You know, $45,000 for a house is great.

Well, yeah. And then you've got two paid for houses. Yeah. One that you're renting. You're going to be doing great. So just do them in a correct order. Honestly, Johnny, since the house is only that much, I would just almost throw it into the dead snowball.

I would. That's like what people pay for a car. Exactly. Well, they pay more than that. And I think it's important to call out, you mentioned One Direction. That's George Campbell's favorite band. It's amazing. Hey, 888-825-5225.

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I'm John Deloney, joined by Rachel Cruz, taking your calls, 888-825-5225. Today's question comes from Ella in Nevada. Ella writes, my partner and I used a lot of your advice in our day-to-day lives, and I desperately need your advice. He's 22, I'm 21 and currently pregnant. We're both in college and still financially dependent on our parents but want to become independent to support our new family. Problem is, partner says he does not want to get married until sometime after we move in together and the baby's born. I don't want to get married just because we're having a child, but we've been dating for three years and have had this conversation before. I don't understand why there's so much pushback now

and when it's more important now than ever that we get married. He claims that finances and the timing do not work out, but he knows I don't want an expensive ring or wedding. I only want to make it official. Why is he holding back? And is it time for me to draw a firm line saying i will not play house with him whoa what do you think what i was gonna say dr john deloney what do you think i mean it's like the uh i've been learning i don't know why i'm probably to the game

attachment styles he sounds like a voidant yeah oh big time yeah um it sounds man there's so much here i mean he's 22 yeah this is pregnant you're in college he may not have any money he feels like i can't and now and to be responsible for a child and a wife probably feels like a lot of pressure for him right no question about it and i will say this as a guy who did, my first kid was in my late, late 20s. Like we waited a long time. I did not fully understand the responsibility of what was coming our way when my wife got pregnant. She understood that immediately. And it took me, I had to learn, right?

And that's not an excuse, but I didn't fully understand what was happening or how much our life was gonna change. And so there is that. The other side of it is, y'all are 21 and 22, and now y'all just got thrown into grownup land. Yeah.

Right? Real, real fast. I'm just going to be honest. He may not want to marry you, and he may not have been planning on marrying you. And you say, we've been together three years that doesn't matter it might have been a college romance for him and then he's going to move on with his life and so all that to say is i don't think y'all you're talking about rings or weddings i think y'all are on way different pages i would

recommend y'all go sit down with a a relationship counselor even a marriage counselor have the conversation about how you're going to co-parent and start from there. Yeah. Because Ella, I mean, all, only what you can control is you in this situation. And so I would be talking to your parents and saying, Hey, once this baby comes in, cause I mean, they're still being financially supported by parents. Am I off the payroll? And are you going to still be with, you know, what, how can I create a life for me and my baby? And, and then you have have to decide is he going to be a part of it still or is this a deal breaker for her to say like if he's not going to commit to this i'm out right so and she doesn't nobody

well let me say it like this i've had this conversation i can't even tell you how many times with college students and their parents. And some parents would say, you went and did this? You're out of our life, which I think is a terrible choice. It's a terrible decision. I've never seen parents not regret that move. The other one was, I don't want to keep paying for tuition, but I also know now my daughter's going to be a single mom dropping out of college as a senior.

I understand the statistics tell me what trajectory that's on. All right. So I'm going to pay for an apartment and I'm going to pay for college to get her out of. So y'all sit down and have that conversation. You just have to create your life. And which means Ella, you've got to move forward as though you're a single mom of a new baby and with a boyfriend. And that's the plan you have to make for housing for child care and that means you have to sit down with your parents as much as you want him to be involved he's telling you i'm not going to be involved and that's heartbreaking that's sad it's whatever but like rachel said you got to deal with reality on this one yuck yuck yuck yuck yuck and by the way

for all those out there rachel talk to people who say oh i don't want to get married yet because of our finances yeah I would never stop a life choice like getting married even having a baby of waiting on the finances to be in a good spot because the truth is that that finish line can keep moving now and can it be less stressful if you have money saved and all the things and then you have a baby sure but also I don't want you waiting till oh I get out of debt and we this, this and this. Just start your family. I'm like, your family is like number one, right? Like there's a priority level in the sense of if there's something in your life, a change,

like marriage or a baby, just do it. Do it. And then you can figure out the money piece. And you can do it together. Yes. That's the other thing. And there's this big cultural lie that I've got to be perfect, and then they've got to be perfect, and then we come together.

It's nonsense. You'll never be fully you in isolation like that. So, man, get married. Go do your thing. Yeah, the ring and the expensive wedding is kind of off the table right now. Y'all are two college kids that are having a baby. So if you're going to do it, let's just do it, and we'll do the other stuff later.

But, yeah, it's time for you to, A, draw firm lines, and, B, you've got to start getting your life in order because you've got a baby. So if you're going to do it, let's just do it and we'll do the other stuff later. But yeah, it's time for you to A, draw firm lines and B, you've got to start getting your life in order because you got a baby coming, whether this deadbeat is going to be in the life of you two or not. And yeah, there we go. We'll go out to Tampa and talk to Beth. Hey Beth, what's up? Hi. So I have a question. I am following the baby steps currently in baby step two, trying really hard to get the rest of my debt paid off. Most of the debt I have left is in my car. So I am looking to get rid of it and get something that costs a lot less so I can get out of debt faster. But I'm upside down on the car loan. So I'm not sure like the best way to go about getting rid of this. Sure. How much how much do you owe on it? How much is left on it?

I owe about $18,400. Okay. And how much is it worth? I was just at the dealership the other day and talked to them. They said they would probably only take like $9,000 or $10,000 for it. Okay. And dealership is the more expensive route, or you're going to get less of the money for that car at a dealership because they have to do a markup because they have to turn around and sell it, inventory, all of that. So your best bet is through a private party.

But how much do you make a year, Beth? Just under $60,000. Okay. You know what, Beth? Keep the car. Keep the car. Pay it off. Yeah, and pay it off. You're fine. Because our rule of thumb is if you can't pay it off in 18 months or if it's more than half of your annual income, that's when you have way too much card and it's going to be hard to get traction and progress. But with these numbers, I mean, you'll be able to do it. Okay. I guess the other part of it, why I'm trying to get rid of it too is because i i actually

have a kia i'm not sure if you know about the problems going on with them right now um but i can't get it insured and for me to be able to get it insured it's like way out of my price range it's a ridiculous amount of money to try to get it insured i'm i'm at the point where it's time to renew my policy and i really am having trouble trouble trying to afford the insurance on it. Well, all insurance. So that's the reason I was trying to get rid of it. Okay, yeah, all insurance is through the roof right now. So, yeah, you do want an insurable car, but...

What about a Kia makes it uninsurable? I've never heard that. So they've been having a lot of issues lately. There's certain models, and I think mine is one of them, that they were not made with some kind of like security system, like anti-theft, and they're really easy to steal. I did talk to like some insurance companies, and they did tell me like, yeah, my Kia is the problem. Like they're not insuring Kia's almost a lot of insurance companies. And did Kia not have a recall?

And to fix it? i'm not sure yeah you can't have it you can't have an uninsurable car yeah all cars have to be insured on the road so there's got to be some my goodness and i think and in a sense too though beth i think that i don't know you'll have to run out the numbers but taking an eight thousand dollar hit on a car just because of insurance doesn't sound right doesn't sound worth it to me right um yeah so again i would still shop around and again it's um i mean all insurance is up right now like we're seeing that across the board on all in almost all states um it's a lot and so yeah i would hate for you to take a eight thousand dollar hit though on something that you're going to be able financially to pay off. But again, I don't know what the insurance is telling you. How much are you paying now and how much are they quoting you? Well, right now it's like almost $500 a month for just my one

car and just me as a driver. And how much are they quoting you for the future? It's about the same. It really hasn't not gone up too much, like maybe a little more, but it's just, it's hard because I had paid it in full before. So now that it's like time for a new, I can't afford to pay it in full again or like the monthly. So I didn't have the monthly insurance payment before. Call our friends at Zander and call a local, endorsed local provider in your area.

I just got a message from my brother-in-law, a family member this morning that said he reached out to a local ELP for the first time and they knocked $300 off. It's a great crew. Yeah. They shop all different companies, Beth. It's not just one specific. So yeah, check out zander.com through Ramsey and a local endorsed local provider. Thanks for the call, man. And we need to dig into this. Kia game.

This show is sponsored by better help. This is the season for Halloween. It's October. We're wearing costumes and we're wearing masks. If you haven't started planning your costume yet, get on it. And while you're thinking about it, I want you to be honest. A lot of us hide ourselves. We hide our true selves behind costumes and masks all the time. We do this at work. We do this around our friends. We do this around our families. We even do this when we look at ourselves in the mirror. I know because I've

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That's BetterHelp.com slash Deloney. All right, folks, a lot of you have questions about taxes. We get it. They're confusing. You don't like paying them. It's kind of like the government says, hey, we know how much money you owe us, but you figure it out and send us a check. And if you're wrong, then you have to go to jail. We know that it's the worst, right? And people say, here's a question from one of our listeners. We normally have someone do our taxes, but our accountant retired. I think we have a simple return. Should we try to file ourselves with Ramsey Smart Tax? You can for sure use a software like Ramsey Smart Tax if you feel confident filing on your own and your situation is relatively simple. We recommend working with a tax pro when you had a major life change, like somebody retired,

you got a big inheritance, you adopted a child, or if you own a business, or if you're not confident about filing your own taxes, or if you just want to save time and stress and just outsource it to somebody else. If you're confident about filing your own taxes, head to ramseysolutions.com slash tax. You're going to have Ramsey smart tax with low upfront pricing, no hidden fees, no trying to sell you something on the back end so that we can all get richer. Everybody shakes hands on the front end of this deal. Or you can connect with a Ramsey Trusted Tax Pro. Again, all of that can be found at ramseysolutions.com slash tax. Let's go out to the Utahs in Salt Lake

City and talk to well, well, well, my Michelle. What's up, Michelle? Hello there. How you doing? I'm doing great, thanks. Excellent. What's up? So I have a question. My husband and I, we own two homes, and our primary home is paid off. It has about $550,000 in equity, and then we have an investment property that we owe about $90,000 on,

and that equity is around $90,000 on and that equity is around $700,000. We have both of these homes in an irrevocable trust naming our daughter as a sole beneficiary. It was set up that way originally because my husband's son was not in our lives at the time but he has since come into our lives and my husband originally had approached me and said hey I want him included as a beneficiary. We need to change the irrevocable trust. I was in agreement that he should be a beneficiary sometime in the future when we demise. But recently he came to me and said that he wants his son actually to be able to move here to Utah.

And the only way for him to be able to afford to do that is if we give him the rental property. And so I'm not in agreement with that because I don't think it's wise from a financial standpoint for us. We don't have any other assets. We don't have any debt, but we also don't have any other assets. So we're not in a position to really be just giving somebody a property outright. Yeah. How old is his son? His son is 40 years old. And why isn't his son able to afford to move where his son wants to move? So they do have a home where they live.

Where we live is very expensive. The average home is between. So he can't afford to live there. He can't afford to live there. He can't afford to live here. Yes. And that's why my husband is like, well, he can if we give him this house. Yeah. Yeah, dude, that doesn't sound good. And what about your daughter? And that's the other thing, too. She would be in agreement because she just wouldn't want to be confrontational. She'd be like, okay, that's fine if that's what you want to do.

But, of course, she's going to be hurt if he's given a house that she originally thought she was going to have. With $700,000 of equity, I'd be pissed. I'm sorry. What? Yes. So we have a greenhouse on the property and my husband is wanting to create a CSA in the future. So his other thing was, is he said, oh, you know, he'll be here to carry on my name and keep my, keep the greenhouse. It sounds like a husband issue more than the son issue. Dude, this is 100% a husband issue. Here's what it sounds like. It sounds like he is trying to buy back lost years. And you can't do that.

Yeah, that's my feeling too. You can't do that. You're going to throw money into a fire pit. And don't do it. Don't do it. He's going to compromise his relationship with his son it he's going to compromise his relationship with his son he's going to compromise his relationship with his wife and his daughter it's just going to become a mess if he wants to rent this house if y'all want to rent this house to him even at

a discount fine for a season um but it also sounds like if he's back in the picture you fighting for no no no we have a will and it's only one kid well if there's two kids in the picture. You fighting for, no, no, no, no, no. We have a will and it's only one kid. Well, if there's two kids in the picture, then maybe y'all need to sit down and redo your will. But this whole thing is a much bigger conversation. Yeah, the will is one thing. Giving them just a house right now when he can't afford to move there.

Yeah, that's just madness. Y'all can't afford it. He can't afford it. Nobody can afford this. Right. And your husband wants to make up for lost time and be around a son. I totally understand that. The problem is this gnarly, ugly reality called math.

It doesn't work. Because this is your retirement. Is that what you were saying? That you guys don't even have a lot like this is it? We're right. Our primary home is paid off, and both homes have a lot of equity. We have some gold some silver a little bit of that but yeah we don't have anything else when we retire we'll

depend on our social security yeah so i think that's why would he give away three quarters of a million dollars of your financial future because he's emotional to a 40 year old i think so i think he originally is like we probably aren't ever going to sell this property because we're going to put the greenhouse on there and we're going to have a CSA. But we don't know what the future brings. We don't know if the CSA will be successful. We don't know if we'll ever need to live in that house

and sell this house. There's a lot of unknowns. And I feel like... Is your husband a gardener? Is he a gardener? No, he's not a gardener. He just recently decided that he, with the way things are in the world and food security, he's like, he is so awesome.

I would get a third party involved, Michelle. I would sit down with a good therapist or a counselor, and you guys need to hash it out. Because again, when you get down to it, what John said, I'm like, it's not even like the house isn't the problem. It's everything underneath. It's the motivation behind it that's unhealthy. Well, watching a lot of youtube the way the world's going we gotta have we gotta start our garden yeah hey listen it might be me just as an i know it's

rachel for sure like as a guy who lives on some acres outside of town and and has gardens we've got enough produce we share with all of our neighbors. My wife's amazing. Yeah. But even she, after last year, canning, jarring, we've got jars and cans everywhere. Our neighbors are gaining weight. She said this year. From the fruits and vegetables. Yeah, from the vegetables. She said, am I doing that this year? That's crazy.

Right? And that's why I tell my husband, we don't know that his son, he may come here and that may be exciting for him. He's emotional, Michelle. He's emotional. There's so much baggage and so much. He's anxious. He's Michelle. He's emotional. There's so much baggage and so much – He's anxious. He's anxious.

He's anxious. There's so much there, and I really would. I would sit down with her probably because he's not listening to you, his wife. And the fact that y'all aren't a team and an agreement is always a red flag. The red flag goes up. And that happens in every marriage, right, to a point. Like something goes up. Not mine.

Yours, Rachel? And it's perfect. We agree on everything all the time. And I don't want to be the bad stepmom that didn't let the son come live here because i i'm not the math the math isn't mathing as the gen zers say you're the you're the you're the the planner you're the um wonderful a sturdy human being who's saying hey i don't want to give away three quarters of a million dollars to a 40 year old man who has a job and a family of his own. Right, and that we need to figure out if he wants to move here

and he truly wants to move here, then we can certainly help facilitate that and figure out how to do that, but it can't be. Well, let me flip it in reverse. My parents live in a great house in Texas great house in texas in central texas in a small town they are talking about moving to nashville their living um their living experience is going to be radically different and they know that so if they move here it's not going to be apples to apples right because living in nashville is infinitely more expensive and like basic groceries and restaurants like it's yeah it's moving around

real estate all of it's different so there's just a reality to it and that's why rachel like what she's saying is dead on this this is none of this is happening in reality that i'm going to start a gardening company and save my neighborhood. And then my son is going to carry on our legacy, by the way, the son that I didn't have much of a relationship because he cut me off or was out of the picture or whatever, whatever was going on back then. And so let's go ahead and give him a three quarter of a million dollar house. Forget the will, forget the trust, forget our joint kid. We don't care about that person. We're just going to do all this is in madness. and this is a guy who

is spinning out spinning out he's to sit down and talk to somebody y'all need to talk to somebody and begin to to paint a picture that is rooted in reality yes and there's such a beautiful redemption part of this story right i'm like they've reconnected yeah it's amazing they want to be close to each other like in even proximity of living close together. Like I mean, all of it is so good, but just do it the right way. And throwing a house at the situation of someone that can't afford that part of the country or that part of the state, it's going to do more harm. And then in the meantime, fracturing relationships, possibly with your daughter, with you, Michelle, because you're not fully on board. I mean, all of it. So there's a right way for this relationship to be healthy and so good. And what a gift, right? What a gift. But just don't let the

money be the muddling, muddying it all up. This is The Ramsey Show. We'll be right back. What does the future hold for business? Ask nine experts and you'll get 10 different answers. Economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 40,000 businesses have future-proofed themselves with NetSuite by Oracle, the number one cloud enterprise resource planning system. Ramsey Solutions uses NetSuite, and you should too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities. With one unified business management suite, there's only one source of truth for the

visibility and control you need to make quick decisions. NetSuite's real-time insights and forecasting help you see into the future with actionable data. And when you're closing the books in days, not weeks, you can spend less time looking backward and more time focusing on what's next. And speaking of what's next, download the CFO's Guide to AI and Machine Learning at netsuite.com slash Ramsey. It's free at netsuite.com slash Ramsey. This is The Ramsey Show. I'm John Deloney, joined by Rachel Cruz, 888-825-5225, taking your calls on money, life, relationships, parenting, all of it. Let's go out to Oklahoma City and talk to Brandy.

Hey, Brandy, what's up? Hi, John and Rachel. How are you? Good. How are you? Good. Okay, so I'm really nervous, but I just started Baby Step number two and it's super, super overwhelming. But I did have a question regarding one specific debt because I don't really know what to do with it or where I should place it. All right. What is it? Okay. So it's a debt settlement company and I am currently, I've paid two, it was a, it was for a credit card settlement. I've paid two off. I have two that they have

negotiated that I'm currently paying. And then I have two that are unsettled. So I don't really know if I should, um, cause I'm really scared. Cause I don't know. I don't want them to like take my money and run without paying for it without paying them off. So I don't scared because I don't want them to take my money and run without paying for it, without paying them off. I don't know if I should wait until they settle the last two or if I should try to get out of it or how to do that. I'm just really confused. Is that your only debt? No, it is not my only debt. I have $110,000 total in debt.

Okay. What are the last two? What types of debt are they? One is like a small bill to like AT&T. It's like $300. It's not very much. And then it's a credit card to Wells Fargo. And how much is that one? It's $4,272. And that has the one that has not been settled yet. Okay. And those two, are the ones that are not settled, correct? Right. They're, I guess, would be like still in negotiation. Okay.

Okay. And where are you guys at in that negotiation? Because I would hate for you to pay on it and you guys settle for a less than amount, right, in writing that you're able to, that that's the amount you actually pay for. When do you think it'll be settled? So the estimated settlement date is like September or October. I'm expected to graduate the program is what they call it in June of 2025. And if I were to continue to just make some $220 payment that I make a deposit

into there every month, it would be like 3000 something that I would still owe. So I have included the 4,200 into my total debts. I know if that disnegotiated, it'll go down, but I'm not really sure how to navigate that. If I should just continue to just pay on it, like the minimum payment, or if I should like throw it, because it would be pretty like quick into my debt snowball if it was just this amount. So I'm not really sure where I should put it or what I should do in regards to. Right, right.

Go about paying it. Yeah, well, the $300 one, I probably, I mean, that feels like it could just be settled, right? I'm like, you could just pay it off and it would just be gone, right? Yeah, I mean, that feels like it could just be settled, right? I'm like, you could just pay it off and it would just be gone, right? Yeah, I think so. I can probably get that one done. That one kind of popped up on me like a few months ago

and they kind of just took it over. So I could probably get that one taken care of. Okay, are you able to get out of this? What kind of program? When you said, I'm in a program until 2025. Yes, so I started a debt settlement program it was november of 2020 where basically i just all of my credit card debt i just gave to them and then they're settling it for me yeah yeah are you in a are you in a contract with them are

you able to get out of this whole like thing all this so so yeah i'm not actually i don't actually know on on that i'm not sure how they work um i had gotten a divorce like four years ago and i was kind of in a hard place and i didn't have any other option but now i understand that it's not a good sure sure it's already happened so i can't really do it well it's already happened you can though i want you to your path forward is you taking back your autonomy, taking back your power in this, okay? It's your money, and it's your bills. If you've signed a contract, like Rachel said,

you've signed a contract and there's no way out. But I would want to know how much you've paid off since 2020, four years later. My guess is you've been paying money into a into a hole in the ground and you're still going to owe a whole bunch of money when this is all settled yeah and with their fees yeah plus their fees

so they've just burned your credit to the ground they've burned your ability to get yourself out of this to the ground and they've taken their fee money and you're going to get done and you're still to owe ninety thousand dollars on all this well are you is it just the four debts that are with them the two that are settled and then the two that are unsettled um yeah so i started with with seven i have paid three of those off over the since i've been in the program so you have four left yeah two that I'm currently paying on

that they've negotiated um I've made 22 of 24 payments on one and 28 of 36 on the other I'm not sure why they divided up like that but um that's the number so what I would do Brandy is I would call them and just say hey I went out I went out and what can I do and you may get charged a penalty for that whatever it may be. But I don't want these people. These people don't need to settle for you like you. You have the debt. We're going to figure out a plan with you right now to to pay it all off on your own without them. I just don't want them part of your life. And if you can just get out clean and and some of the money for the last four years may have been going into a black hole and we just call that stupid tax that

we do things and we're like, I don't know why I did that but i did it's where i was and now we're going to move forward so i would call them today brandy and what and whatever and just say stop all the negotiations all of it i'm out i'm done can can you just give me everything back in my name fully even the way they call it you graduate as though you're getting like that language is so manipulative all of it okay so brandy walk me through because you have a lot of debt and i want to know your whole i want to know the whole picture walk me through every piece of debt that you have okay um so um between me and my husband our total take-home pay is right at a hundred thousand It's like $99,000, like $800,000. And then my total debt is $110,000 and $66,800 is student loans. And my student loan payment is the highest payment of anything I have,

including my rent. So I'm trying to move that away because that just overwhelms me and I hate it. Sure, sure. And then the other four debts that you have with this is, and those are what again? I have $33,000 in auto loans between three vehicles. I have a vehicle, my husband has a vehicle, and then he has a child with a vehicle that he pays on. Okay, how much are you? I owe $12,000 on mine. He owes four on his,

and then the child's vehicle is like 18,000. Oh my gosh. Oh my gosh. How much could you sell that for? Or it's his child. I'm guessing this is a, this is a second marriage. Yeah. I'm not sure if I would be able to really, because that was his gift to his kids. So I don't really know if I want to try to, I would just rather pay that debt down. I don't know that I would rather. I don't know that I would want to get. Okay. So here's the thing. Okay.

So I hear you. I hear you. But also, Brandy, you have to realize that when you are married and you guys are together in this, that if you guys can combine everything. And when I say that, it's like we're combining debts. We're combining incomes. We're combining budgets like we are all one. You basically magnify sometimes the debt because one one person has the student loans, one person doesn't. But you also magnify the opportunity. And there's something about locking arms and doing this together, Brandy, that's really your best shot of getting out of this.

The fastest and the most efficient is when you and your husband together say, we're on this plan to get out of debt together. And it's not just Brandy over here spinning her wheels and trying to figure all this out. And so how willing is he just in general to do this money stuff together? Oh, he's very on board. That is one thing I have not talked to him about is specifically that vehicle. Okay. So that's one conversation we have. And maybe that's on me for avoiding that just because I'm conflict averse.

So maybe that's part of the problem. But I could have that conversation with them. So you're conflict aversion. Maybe you are, but let this be the moment, right? A conflict aversion, you've hired a company to deal with some of your debts, and it's cost you a lot of money and a lot of time and a lot of heartache. There's particular debts on the table in your home right now that you don't want to talk about, and you can create a story about how, hey, you know what? That's really not mine to talk about. But as Bessel van der Kolk says, your body's keeping the score on this one. Okay. It knows

that you're not all right. So put all the debts on the table. Let's go through all the debts. And talk to him that you're scared. I mean, Brandy, that you're stressed, right? Like come with him and just say, I want to do this together. And I just feel like it's an uphill battle. And it's not. You guys can do this. You can, but bring it forward. The money you make and the amount of debt you owe, you can do this. Y'all can do it. Hang on the line. We're going to send you Financial Peace University Total Money Makeover as our gift. That's one hour in the books. We'll be right back on The Ramsey Show. Live from the Ramsey headquarters in Franklin, Tennessee, it's The

Ramsey Show, where we help people with their money questions, with questions about doing work that they love, and their life and relationships. I'm John Deloney joined by my good friend Rachel Cruz and we're taking your calls on just about anything. Give us a buzz at 888-825-5225 888-825-5225 888-825-5225 If we don't know an answer, we will make one up!

Let's go out to Sacramento, California and talk to Austin. Hey Austin, what's up? Hey, how's it going guys? Thanks for taking my call. You bet man, we're part hey Austin what's up hey how's it going guys thanks for taking my call you bet man we're partying what's up so a little bit newer to the Dave Ramsey show and I've been listening to the podcast last couple days so uh just a lot has kind of come out so hey hey welcome to the cult my friend we're glad you're here we're glad you're here thank you so what's up uh so I have about $90,000 in student loan debt.

Just a little bit of out-of-state tuition being irresponsible. And I'm currently getting my MBA right now too. And I'm a little more than halfway through. I also have a car loan that has about $12,000 left on it. And the value is about $16,000 or so. I don't have any credit cards anymore. Got rid of all the credit card debt and credit cards. I have about $18,000 or so. I don't have any credit cards anymore. I got rid of all the credit card debt and credit cards. I have about $18,000 saved up right now as an emergency fund

with about $10,000 of it in a high-yield savings account and the other in my checking and savings. I also have, it's a lot, but 10% going to my high-yield savings every month just to save up for tuition so I don't have to add to the student loans, course and then I also have my 401k it does up to a four percent match I'm contributing 10 right now so my question is this one to start should I keep putting money in my 401k right now either the 10 the four percent just to get the match or none and then the second part of that question is if I get aggressive, I can probably pay off

my car in, I think, nine months to a year or so when there's about two and a half years left on it. But if I were to pay on my student loans right now while I'm in school, it would go directly towards the principal. So which one should I go after? What are you doing? Yeah. And then I do have a little yeah what do you do for work uh consulting management consulting okay how much are you making uh base is 84 okay um what are you in school for uh getting my mba and you have two years left of that, correct? Next spring, so a little less than a year. Okay, good.

And you're able to cash flow the rest of that. As you look out, you won't be taking on more debt for that. Yeah, if I save the 10%, it'll cover about half of that so I can pull out of my emergency fund and do it. Just looking at the baby steps, I have... So Rachel's going to walk you through this, brother, fund into it um yeah just looking at the the baby steps i you know i have yeah so rachel's gonna walk the step two rachel's gonna walk you through this brother but here's what i want to say yeah you are a driven smart guy and so we are we are totally team austin here's what i'm seeing from a 30 000 foot view you're in it there's bullets flying there's smoke. You're in it. There's bullets flying. There's smoke everywhere. You're in it every day. You are trying to do everything all at the same time and you're slowly leaking money

everywhere. And so you're not, so like you are paddling so hard. The way you are paddling is so admirable, but you're not getting anywhere because there's water coming in all over the place. Does that make sense? Yeah. Okay. So Rachel's going to outline it for you, but you're not getting anywhere because there's water coming in all over the place does that make sense yeah okay so rachel's gonna outline it for you but you're gonna have to make some short-term sacrifices to get where you want to get and when you get there it's going to be much better up on arrival okay guys you have one quick wrinkle to add to it okay uh my fiance inherited some money and she offered to no no no no don't, no, no, no. Don't do that. Okay, okay, okay. Don't do that.

Not yet. If you take her to the courthouse this weekend and get married, then it's y'all's money. But until then, don't take her money. Don't take one penny of it. Okay, all right, all right. Yeah. Got it.

I didn't want to do that anyway. Perfect. Okay, so you owe 12 on the car, but it's worth 16. Sell it tomorrow. Okay, here's what I would do, Austin. If I woke up in your shoes because that's always kind of how we frame this scenario if i woke up in your shoes tomorrow i would take maybe two to three thousand out of the emergency funds and that leaves me with fifteen thousand

and i would add that three thousand to the four thousand that you'll get when you sell your car and i would go get like an eight nine thousand dollar car and i would pay cash for it and be done with that debt completely like you're you're done so okay so then you're done then you're down to fifteen thousand left in your emergency fund i would pause investing completely and my next focus would be to do anything i could to save up a hundred percent to pay and finish out your mba that would be my next focus would be to do anything I could to save up 100% to pay and finish out your MBA. That would be my next goal. And then once you are completely out of school, all is good, then I would start attacking the $90,000 in student loans. Because yeah, while it would go to the principal, which would be that's great obviously but there

you don't owe it obviously until after graduation and so um i almost just what i would i would just my number one sole focus would be to get my mba without taking on any more debt and then once you're out of school do you think you guys will get married soon after and i'm not asking because of the inheritance i'm just asking in general like will you guys yeah get married soon after? And I'm not asking because of the inheritance. I'm just asking in general. Like, will you guys? Yeah, we have a date for next year, next year, March. Oh, awesome. Okay.

So right before you graduate, you'll be married? Yes. And how much does she make a year? It's a little variable. She left her corporate job. She is doing life coaching. So the low end this year will be 50. The high end will be like 150. But she hasn't made 150 though yet, right? She's made 50. No. Okay. Yeah. But the hope is

that, yeah, that it's a little bit more than that. Okay. So you guys will be on the conservative end because you said your base was 84. That's a base. So I'm like, once you graduate everything, I mean, y'all could be, I mean, close to 200 together. Yeah. Right. I'm like 150-ish,, I mean, y'all could be close to 200 together. Yeah. Right? I'm like 150-ish, but it'll climb. Hopefully, your opportunity is so much. So you guys could knock out, and then with her inheritance, all of that, knock out that 90. I mean, yeah, within that year.

You're debt-free in 18 months. Yeah. Will she have any debt coming into the marriage? No. She's had her car for 17 years and never had a credit card okay wow all right so get out of debt and get her a car in 18 months okay okay but but you see but the order is important right because you're you're the debt that's just kind of like just biting your toes on the car is then leaning and you're going to make a choice about well then i just i gotta pay this and so then i'm not gonna i'm gonna go ahead and take

out another student loan just for nba but then i'm gonna pay the principal over here and you're just zigzagging back and forth you're like a punt returner that's running all over the field you're just not making any forward progress yeah get north and north and south. That's right. Go downhill. So let's knock the car out. Done. And honey, guess what? I'm buying a $9,000 car. That's how much I love you. And she's going to say, I have this inheritance check. Can I just buy you a nice car? And you can say nope. And by the way,

she's going to respect you more in the long run. That you're like, no, no, no. I dug a hole. I'm going to get this thing cleaned up. And then we're going to go to school debt free. We're going to knock that out. And then we're going to just crush the rest of it. We're going to be good to go. Yeah. How old are you guys? Okay. I'm 30. She's thing cleaned up. And then we're going to go to school debt-free. We're going to knock that out. And then we're going to just crush the rest of it. And we're going to be good to go. Yeah. How old are you guys? Okay.

I'm 30. She's 33. Awesome. Okay. So great. Because I'm like, I mean, seriously, Austin, by the time, gosh, you guys are, you know. Be debt-free at 33. 30, 36.

Yeah. I'm like, you're going to have two cars. You'll, by that point, replace cars, be debt-free, killing it when it comes to your jobs and your careers. And by the, the i mean and then you'll be putting money towards retirement after that i mean it's just amazing you guys really will make so much progress but it's just one thing at a time and i want you to feel some of that sacrifice now but make it the goal to finish out the nba with just cash and yeah you guys are

killing it great job austin This is the Ramsey Show, 888-825-5225. That's 888-825-5225. Listen, check this out. Join us in Nashville at Ramsey Headquarters for our brand new event, Total Money Makeover Weekend on May 10th and 11th. It's going to be a party. In one weekend, you're going to get a crash course on everything we teach about money with all new stuff. Now, here's the deal.

Millions of you have joined us in the last couple of years. Like the last caller who said, man, I just went down a rabbit hole. I've been listening to all the podcasts. I'm trying to figure this all out in real time. It's like drinking from a fire hose this weekend is for you okay it's the 20 is the 25th anniversary of total money makeover yes or 30 30th 20th 25th for you millennials out there the book was written before you were born and it still works no millennials gen z whatever you youngsters yeah millennials are in the 30s all right good job millennials all right hey it's for you it's for you the book is um getting a complete overhaul um but the principles are staying the same it's gonna be a live taping of the hit podcast smart money happy hour we're gonna have

live interactive q and a's all throughout the weekend i think rachel and i are gonna do a money marriage thing so it's gonna be a wild party. Dave, Rachel, me, George Campbell, Jade, Ken Coleman, and probably some surprises like always when you get in a Ramsey event. Don't wait to get your tickets. Platinum Plus already sold out, but you can get Platinum or VIP tickets if you get them now. Go to RamseySolutions.com slash events. Total money makeover weekend, May 10th and 11th. Alright, let's go out to

Indianapolis, Indiana and talk to Keely. What's up, Keely? Hey, thanks for taking my call. I was calling. My husband is obsessed going debt-free. But he won't take one step at a time. How do I get him to take one step at a time oh my gosh what do you mean

yeah what's happening um so he if we have about 65 000 in consumer debt and he just thinks it's possible for us to get it done in just a few months and is it not realistic for us no have y'all sat down and made like a plan on paper we have we have we sat down we started doing budgets um taking making some cuts that we needed to do and it's still that the 65 000 isn't even what we make half a year so where does he where does he get this these numbers from um he just sees all this debt and he just they start running in his mind they're just they're they're flying at him okay so what what is he doing though like in reality that yeah is he like selling stuff and you're like whoa that's our couch don't sell our

couch like what's he doing yeah so that's kind of the thing he's willing to sell it all he's willing for us to sleep on an air mattress at this point yeah um yeah so but we have been selling things he picked up a side job i mean we're we're doing the work towards it but yeah we haven't even done step one he skipped step one so the emergency fund we'll get to it later he's like i gotta get rid of these credit card debts. I got to get them now. Oh, my gosh. I so appreciate his enthusiasm.

Okay, so how much do you guys make a year, Keely? About $115,000. Okay, and you have $65,000, is that what you said, in debt? In consumer debt, yep. In consumer debt. Okay, $65,000. So you all have no money saved right now like not even a thousand dollars we have right at 700 okay so yes he needs to bump that up to a thousand um yep and then what is and

so again being specific on your end because you're calling us saying he's obsessed with it what do i is it is it uh is it that because you never see him Is it because it's all he talks about? Is it like what's annoying you? That's all he talks about. He's not sleeping at night. Just the conversations. We can't have a conversation about our kids even in the evenings without him being like, well, there's money signs already flying out the window. Okay.

All right. So here's what I think is important. Is he a guy that gets this way about a thing and it goes away in three months or is this a new husband for you? This is a total new husband. Okay. So he didn't like when Little League was going to start the first year, he's like, we're going to crush. He's not that guy? No. I mean, he's been the type to always check his bank account to see where he's standing with his money, but never to this extent. We're checking it a thousand times a day.

Okay. Okay. So he's just, his body flipped a switch and it's game on, but it's like atomic game on. It is. Yes. I'm afraid he's going to, yeah, he's just going to go start running and he's going to be that guy who picks up the fumble and runs the wrong way. Exactly. Into the wrong end zone. Yeah. So I think, I think i think it's just it's a it's a total mindset shift in your household and there is a level of momentum that he's actually probably feeling with

his money for the first time ever yeah um and i don't know this is so stereotypical but the way we've usually like talked when it comes to men and women with money for women a lot of people and this has been through research that our number one fear is security and yeah and if the money is not good i don't feel safe right like there's that deep feeling for a guy it can be a sense of like you know we've heard we've said like a scorecard or like there's a sense of safety but also shame yes i put my family in this hole and i'm getting us out today yeah so there's like a motivator that he has keely that you may not have right there's something in him that suddenly the light has turned on and he sees a way out and

it is like he's not stopping uh so what i would want you guys to do is to be in agreement that you may keely for a hot second just smile and nod as he talks about the debt all the time and the budget all the time. And you just say, okay, okay. But your life choices and how your family's set up, you guys need to be in agreement on because it is not fair for you to say, yes, the school, you know, the kids, I have to make lunches for school and here's the budget for the groceries. It's like, nope, got to spend only $20 this month. And you're like, no, no, like literally that's not realistic. So like he has to have reality you are gonna you know a part of me is like i don't know good for him you know and i'll tell you i am somebody who gets overly zealous

about a thing okay and i'm gonna tell you here's how my wife has kept us married without her going bananas is when i get overzealous about a thing, she will sit down and she'll say, Hey, every conversation is becoming about X, Y, or Z. You get one or you get three. And it's kind of, it's a joke and she's never held me to it. And if you know her, she's funny like this, but she'll say, you get one, John. I'm going to listen to one new thing about some new weird nutrition hack. I'm going to listen to one thing about some new doctor.

Yeah, cold. Like one more thing about ice baths. You get one a day, right? And so here's what I would love to see. How long have y'all been just, how long has he just been Tasmanian devil about this? Since December. Okay. So here's what I would love you to do.

I would love you to take, set up and say, honey, I want to take you on a walking date because we're not going to spend any money, but we're going to go to a park or something like that. Or we're going to go get coffee and look at him and say, we're spending $9 on coffee. And here's what I want you to do. I want you to take a spreadsheet or a plan or your budget or whatever it is and tell him, I'm so proud of you for being a part of this change, but I also feel like I'm losing my husband. I need my husband back. Okay. And if you can communicate to him in whatever language you all use,

not an accusatory, but in the same way he feels panicky and shameful about the whole, he quote unquote, Doug for his family that he's so insane to get out of. I want you to communicate that same fear that you're losing your husband and we're going to make a plan. We're going to make a budget. We're going to stick to it. We're going to use the every dollar app. Do y'all have every dollar? We do not yet. Okay. It's going to be my gift to you. I'm going to give you the premium version for a year. Okay. Thank you. All right. So y'all going to use that together, but that way he doesn't have to check the banking accounts 24, 7, 365. Any expenses will just pop up on the app. Okay. And y'all will be in partnership together and you can tell him

with a smile on your face, you get one. We'll talk about the debt snowball or money once a day. But we have to learn to live in a rhythm now and we have a map here and the map says it's going to take us 23 months to pay this off. Talking about it a whole bunch every day does not accelerate that 23 months. Maybe you get in a second job or a third job. Maybe that will. Or if there's a raise at work and a

bonus, I shake your hand if that's going to the debt. We dump it all on it. We just did that. Both of us just took that step. Awesome. But the kids still get to play soccer this summer, and the kids still get to go to church camp, et cetera. Okay?

Just build it into the budget. Okay? Perfect. Yes. Thank you. Hey, he's lucky to have you. He's lucky to have you. I know.

We'll be right back. Thank you. Thank you. I know. We'll be right back. Thank you. Welcome back to The Ramsey Show, 888-825-5225, taking your calls on money, life, work, all of it. Let's go out to Austin, Texas, to the 512 and talk to Jacob. Hey, Jacob, what's up? Hey, guys. How are you all today?

Fantastic. Brother, what's up? Well, I've got a few questions for you, and I hope you can provide some clarity here. I've got a few brokerage accounts, one of which being a crypto account, totaling to about $50,000. The question is, should I allocate that towards a $48,000 vehicle loan as well as chip away at $200,000 in student loans? Woo, $200,000. What was your degree in? Yes, that was my wife's anesthesia degree is the vast majority of that. Okay, okay. I'm not going to tell you to get

student loans, but that's not, that's pretty good. What does she make? What does she make in a year? She makes 209 and I make about a hundred. So we're just shy of three team. Okay. Well, that's the good, that's the good news of all of this. What kind of car is this? It is a Chevy Tahoe. Okay. Awesome. And is that the the debt just that and student loans student loans uh in addition would be a mortgage okay just a home in october okay how much do you guys owe on

that uh 320 okay um yes so i would when you cash that out there may be some taxes implications there but um but the rest yeah i would throw pay that off exactly and then i would just yeah lower lifestyle and yeah get this 200 the student loans knocked out i mean if you guys could live on a hundred thousand this could be gone in 12 months yeah sure uh and we've been we have another vehicle as well that we actually just paid off yesterday oh good congrats congrats that's awesome can i tell you if it was me i'd probably sell the We have another vehicle as well that we actually just paid off yesterday. Oh, good. Congrats. Congrats. That's awesome.

Can I tell you, if it was me, I'd probably sell the Tahoe. Does the Tahoe, it's an amazing car. I love them. It's been one of my dream cars for a long time. Does it have any sentimental value, or could you get rid of it? I know you're going to roll your eyes, but could you just Camry this thing for a minute and get all this stuff out, get all this debt cleaned up? It's certainly a possibility. We purchased it about three months ago.

Okay. What's it worth now? Our family has grown. I would have to assume roughly the same. We don't drive terribly much. So I would assume 50 or so um so we're how big's your family uh we just had our second daughter a few months ago so my parents raised all three of us in a camry hashtag just saying but all i know the world's different now but um

i'm so proud of you guys. Y'all make killer money and y'all didn't go bananas with your house. And that tells me that y'all are really wise. And so, man, that wisdom, if you take that wisdom and just say, I know that we make $300,000, but if we live like we just make a hundred, we can change the entire trajectory of our family.

Think about just having that. You make 300300,000. You have no payments except for your mortgage. You can knock your mortgage out real quick, and you're talking about y'all are going to be stupid wealthy. You see what I'm saying? Sure. Y'all could get out in front of this thing really quick

with just a year of hard sacrifice. And by the way, not hard sacrifice. You know what I mean. But living well below your means, y'all could really turn the tide on this sucker. Okay. So just so I'm clear, you would advise to sell everything in crypto as well

as any brokerage accounts. There's also a $10,000 Roth IRA that... Don't touch that. Yeah, leave that one. Yeah, anything that's that doesn't have the penalty that doesn't have like if it's a retirement account leave it alone yeah but i if i'm in my house if i had fifty thousand dollars in a brokerage account with crypto in it i would that would be gone before the day's over okay and john would sell the car

i would sell the car i honestly am on the fence with it i'll i'll just be a little bit yeah you know it's not it's not has nothing to do with your salary to car income ratio. It's just getting out of debt as quick as possible. I would be more haunted by the debt than I would be by a smaller car. Sure. And then would you still advise maintaining,

if I'm not mistaken, baby step two of a $1,000 emergency fund? Right now we have $5,000 in that savings account. So would we whittle that down another four to get to the one. Yes. Yep. And just throw that anything extra you guys have at that $200. And let that dude, I know it will

haunt you. It'll drive you crazy. Let that be the gas that dumps on the fire. That y'all just say, honey, can we do this in one calendar year? Okay. Can we just be bananas for one calendar year oh i'm willing to drive a camry or a corolla not a corolla that's probably too small for everybody but i i'll drive i'll sell the tahoe if we can just knock this thing out and let's put all the money towards this can we take extra shifts can

we whatever whatever it's going to take let's just do this real quick yeah and realistically jacob if that's the route you guys take, you'll take that $4,000 and put it towards another car, right? Because you'll be selling the Tahoe. If you sell the Tahoe, then you'll have the $50,000 in the brokerage account. Yeah, the brokerage account. Yeah, take some out of that too. Okay.

And then I also have another paid-for vehicle. So I don't know if that would you know have any merit in this conversation so you have a third car or just two no sir the one you just paid off yeah that's fine i would just keep it yeah keep that car yeah unless unless it's a 75 000 car and you think well man we could sell it buy two camrys and take that 50 grand now we're we're dealing with 150 grand in student loans instead of $200,000. No, it's just a Silverado. It's a $35,000, $40,000 vehicle.

Yeah, you've got to keep your truck, dude. Don't go too far. Jeez. He's a Texas male. It's part of the these men. It's in our DNA. Oh, man. I don't want to be totally unreasonable, Jacob. Sell her Tahoe. You keep your truck, man. Yeah, I don't want to be totally unreasonable, Jacob. Sell her Tahoe.

You keep your truck, dude. Oh, my gosh. Of course, yeah. She's an evil worst case scenario. Yeah. I'm out of this call. I'll hang out with your wife. Yeah, Rachel.

Rachel, she's not buying any of this. No, quite honestly, I'm going to be a martyr on this one. I would keep my wife's Tahoe and I'd sell my truck. But whatever y'all decide to do, you don't have to sell either of the vehicles. It's just going to accelerate everything. Just think of it this way.

The faster you get out of debt, the faster y'all can start going to restaurants again. You can get that emergency fund built up where you can breathe, where she can breathe, where you don't have to worry about kids falling down and needing stitches, which they're going to need. All that stuff, you just begin to build peace into your home, and you can start building peace after you quit running for your life. And y'all are just running for your life right now because you've got $250,000 clawing at you. Like a car company and a student loan company are telling you two

what y'all are going to do with your lives tomorrow. Right, you have to let somebody else's asset. That's exactly right. You are working for them right now, making them wealthy. And y'all have worked too hard. Y'all are too smart. You're too accomplished to let somebody else get wealthy off of your hard work. Okay.

Well, thank you guys so much for your time. And I can't thank you enough. Yeah, man. I'm proud of you, man. Congratulations. That's awesome. Yeah, it's funny doing the show with different personalities because you get different levels of what you'll do, like what George will do, what Jade would do.

It is so great. So yeah, back to that, though, not to confuse anyone. It is, when we talk about cars, if you can pay it off in 18 months and or it's less than, cars in total is less than half of your annual income, then that's all good but to john's point when you're in this and especially making choices yeah it's 250 000 staring at you and when you can take some of that and say my gosh this percentage could leave right now this percent this this by these radical choices of selling cars doing stuff that's where you see progress it really is yeah and and again i I'm so haunted. You've been around me when I'm not well, when I'm kind of

just out of my mind. I hate owing people money. And so if I sit down and my wife and I put it all on paper and in 12 months, if we live radical, we could do this. It almost baby steps it again for me. I'm'm gonna burn a hole through my mortgage i'm gonna burn all this stuff out and so if it if man if it is a matter of me driving a tahoe or a camry and we're we don't owe anybody anything in 12 months 12 yes shoot that car is going it's gone yeah right it's out of here totally if it's gonna be two years three years that's fair that's fair that's fair all right hey a sweet ride. That's fair. All right. Hey, this is the Ramsey Show,

888-825-5225. We'll be right back. We are back. 888-825-5225. I'm John Deloney, joined by Rachel Cruz, taking your calls on life and money, everything you got going on. Hey,

listen, if you're like me, you see the Congress spending, you see the political infighting, you see like your neighbors are like, Hey, I got this new car. And you know, like, there's no way you can afford that. It's just frustrating because you're watching the whole thing go down and you love this thing this country your neighbors your friends your community and you just wish everybody had this information you don't have to buy anything it helps your neighbors it helps your friends it helps people you've never met by simply leaving a five-star review by subscribing to the show by thumbs upping it or whatever the device you're doing says,

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Send episodes to your friends. Doesn't cost anything, and you can really change the country from the inside out. Let's go out to Charles right down the street in Franklin, Tennessee. What's up, Chuck? Hi, guys. I have a life insurance question. Bring it, man. All right. I'm 60, and my wife is 50, and we have two adult children. We have $800,000 on my life and $250,000 on my life and 250,000 on my wife's life. And they're both in term policies that cost us about $530 a month. I'm wondering if we need that much life insurance now that our children are grown up and our net worth is about

2 million, but that includes our primary residence and we have no debt. How much do you guys have in just cash or retirement or retirement accounts, actual money, not assets in a house? In retirement accounts and 401k combined, we have $560,000. Amazing. Well done. Yeah. So there gets to a point, yes, Charles, where you do become self-insured. And so it really is running out the math for you guys to say if something were to happen to you or to her and that income is not coming in, where does that leave us? So for you, how much do you make a year? I make $125,000 a year. She makes $78,000.

And she makes $78,000. Okay. Yeah. And she's 50. Is that right? Yes, she's 50. Okay. So, yes, I mean, I would for you, I mean, you're in a really great spot. I mean, almost to that point. And so I would just run out those numbers for you guys. I would sit down and say, okay, if something happened to her,

would you be okay on 120 for however much longer you want to work or you need to work in order to be fine, which you're going to be, you have a paid-for house and $560,000 in retirement, right? So more likely you're going to be fine. That 560, every seven years will double. Right. That's right. I'm not planning to retire until I'm 70 as well. Okay, so at 67, that's 1.1.

Right. Right. And what, 74, it's 1.1. Right. Right? And what, 74, it's 2.2. And that's just in your, I mean, you'll be withdrawing from that, obviously. But how much longer are you insured under your policy? You've got to be getting close to the end there, right? Yeah, another 11 years on my policy. Okay, that's a little bit longer than I thought.

So you bought that sucker early, huh? Yeah, I did. I've always been kind of afraid of dying and I did have a heart attack a year and a half ago, but I set these things up when my children were young. So let me ask you another weird question. I call it peace of mind tax. I pay for certain things in my life simply because it helps me sleep at night. Right. And I don't mind paying five bucks a month or 10 bucks a month on several different things because it helps me sleep. Um, can you afford this, this payment? Yeah, we can. We're, um, we're maximizing our retirement accounts, you know accounts with money left over, so we can still afford this if we want to keep doing it. That's my question for you is if you just had a health scare, you have this thing, and you have no payments, y'all are making upwards of $200,000 a year. If it's me, I'm just speaking honest truth here. Forget the math. The fact that

I know that my wife would get almost a million dollars if I were to go and I got real close to the edge just a year and a half ago, I'd pay that money. I'd pay that money every month until they quit letting me do it. Okay. But again, that's not a math problem. That is a, I want to sleep knowing that that woman that I've dedicated my life to is going to be able to do nothing. If she doesn't want to, she's going to be able to do whatever she wants and or needs to do in the event that I go. Right. So that's not a math problem, but that's just me. That's right.

And I'll say it too, because again, we can go the math side, Charles, and I think you guys will be fine. I think you'll run off the numbers and realize we'll be good. But Winston and I, we could be self-insured. And it's exactly what you're saying, John. And we still have life insurance. We have term life. Because I'm like, we're young and we're healthy. It's inexpensive.

And we use Xander insurance. We always get a great rate. And it's like, why not? Why would we not? And so that's, yeah. So if we're speaking truthfully, that's what I'm doing in real life. But again, mathematically charged, if you both are really secure and you're like, Mal, we don't really have that. We're fine. If something happened and that income went away, we're going to be okay. Because the truth is you will be, you will be, you have a paid for house.

You got plenty in retirement. You will be fine. But it's just that peace of mind and maybe it's vice versa maybe you cancel hers and keep yours because maybe she's like nope charles i want so want some money in case something happens to you or maybe you say yeah just in case something happens to her i'll i don't know like it may be one or the other even you drop one keep one drop both you're fine keep both both. So yeah, it's a peace of mind play at that point, because you are at this point self-insured. And here, along that same line, Rachel, just to put this out in the world, and Charles, I'm going to use your situation to just have a broader conversation. My household can only run, I can only do what I do, be on the radio all day, I do my show, I do media in between, I do this show, and then get on the radio all day i do my show i do media in between i do this show and then get on the road and travel and speak and then write books out of hotels in the middle of the night and early

i can only do that because my wife is incredible doing all these other tasks it makes so we are absolutely intertwined as a as a gang we're a team and so if something was to happen to her on paper it looks like well all the money's from, or most of the money's coming from here. I would have to have some additional, I'd have to hire people to backfill the role she plays. Right. Does that make sense? Forget the connection part, like just the day-to-day, like she runs everything. She's amazing.

So she's the CEO of the whole property, of the whole place. So all I have to say is um like rachel said y'all fit factor in what would it cost to replace just the duties right someone to take care of x and y and z i don't know how y'all have it broken up in your home but that looks different for every family but just the reality is my salary is only possible because of the work that my wife does right it's a great point because we work together on this yeah so it's easy to just look at the dollar amount but it's all it's often a bigger ecosystem that's right totally yeah and and charles i'm i'm so glad you called even for this question because you're a great example

charles for people watching or listening because sometimes john and more than not more than not when we talk to people about life insurance it's on the other end of this it's a young family with little kids and a husband dies in a car wreck and there's no life insurance. And it's just, it is, it's compounding the worst stress that you could ever, ever imagine. And so all of you out there, you need life insurance. If someone is dependent upon your income, you need life insurance. And so term life, exactly what Charles is saying.

It is, it's inexpensive. You guys, obviously the younger and healthier you are the less expensive it is but go to zander shop some rates and it is a gift it is a gift to give your family when people don't have life insurance and something happens it it magnifies i mean it doubles down everything you get all those adjectives onto a situation where you just can't breathe i've been to both sides and i think i've told you privately there's a particular hollow look in the eyes of a wife whose husband has just died and she says i gotta go to work on monday like i i know we don't have anything or the other scary she looks and goes i don't i don't know where anything is and i had a friend whose husband passed away and he left a significant amount of money

on a life insurance policy and she got to go to counseling and got to grieve and got to be with the kids wherever they needed to be. What a different trajectory, right? So get life insurance, get it, get it, get it. It's another hour in the books here on The Ramsey Show. We will see you soon.

Live from the headquarters of Ramsey Solutions, it's The Ramsey Show where we help people with their money, their work, and their relationships. I'm John Deloney, joined by my great friend Rachel Cruz, and we're taking your calls on just about everything. 888-825-5225. That's 888-825-5225. That's 888-825-5225. Let's go out to Charlotte, North Carolina

and talk to Hannah. What's up, Hannah? Where are you here? Right there. What's up, Hannah? Hi, thanks for taking my call. Of course. Thanks for calling.

What's up? Yeah, my question is about our house and whether it's okay to sell it or if we should sell it. It's a little bit of a complex situation. We bought the house two and a half years ago, and it's a 1940s home that needs a lot more work than what we had anticipated. So it's going to take us longer to update it than what we had anticipated. But along with that, we have a lot of really great neighbors, but we also have one really awful neighbor that is really making me want to move. But we want to make a good financial decision and not just an emotional decision. Okay. But sometimes emotional decisions aren't bad. Are you unsafe in your home? Um, I don't know. So I, I think we're okay. But, um, I can hear in your voice. Tell me what makes

you think you're, you, you might not be safe. It's with a neighbor, the neighbor that you're talking about. what's going on yeah they're just really um they're hostile and aggressive and a little bit unpredictable in how they behave towards us particularly around one situation where um they really want to control where we park or our delivery drivers park or anybody who comes to our house parks on the public street between our homes um so much so that they've called the police on us twice for parking where they don't want us to park um what do the police say um the police the first time they went he came over and talked to us after talking to them and said, hey, you're not doing anything wrong. They just make sure that you're being neighborly, which we have been up until about today when I

ignored the neighbor because he comes outside and is very chipper and is like, hi, how are you? But after having a run-in with them this weekend over parking during our garage sale. Anyways, they just feel very unpredictable. Here's the deal. I want, when I turn onto my street to head up my driveway, I want my heart rate to start to go down. And that means my marriage has to be healthy. That. And that means my marriage has to be healthy. That means my relationship with my kids has to be healthy.

That means I have to have mowed the yard when I said I was going to, taking the trash out, like all the stuff. That also means I have to be at peace with my neighbors. Yeah. And so that's a part of the homeowner experience. Now, if you say, hey, there's no chance that we can sit down at a table and say, hey, we're neighbors.

Like, can we talk this out? If that's not possible, it's not possible, then have a hard conversation. But I wouldn't go into debt. I wouldn't do anything stupid with my money, but if I'm tired of coming home to an unpeaceful neighborhood or unpeaceful home, yeah, I might consider moving.

Yeah. Okay. So the home, Hannah, what's the money situation? How much do you guys, what equity do you have in it? Do you have money saved? Where would you go? I mean, what's the numbers around that? I think that's part of the tension of it.

I think we would have to rent. So I think the home is worth between $550 and $600. Our mortgage is about $420 on it. We do have a little bit of, well, not a little bit, we are on baby step two. And we have a $90,000 HELOC and then a little bit of credit card debt for our business. How long have y'all been married? Almost 15 years. Okay. What's your husband say about the neighbors? He's overly optimistic.

There's been a couple of things, like he wants me to still be friendly with them. Today, when I told him, I just waved just out of kind of politeness that wasn't real friendly with him. His first reaction was awe, like, and it was disappointing. But I told him, I just think that they're manipulating us. And I don't even want to talk to them anymore. Yeah, that's a fair boundary to draw. It's a fair boundary, and also I'm not going to give up my dignity for somebody else. Yeah.

You know what I mean? I'm not going to give you that. Yeah, and that's where I'm having a really hard time because when I had an interaction with her this weekend, I was physically shaking because I didn't know how far she would escalate. So it's just I don't want to live near them. But it's like to have to move for just that reason alone. And it's not just that reason.

I dream of something different. If this is the case, if you were my wife and you came to me with this challenge, I would sell the house this weekend. And we would rent for a while. Because, hey, here's the deal. This transition is going to come at a cost, some shape, form, or fashion. And can I use you as an example, not to kick you while you're down, but just to kind of paint a picture? Sure.

This is one of those exact reasons why we tell people don't take out a HELOC. Because you never know when you're going to have a neighbor that wants to burn your house down. Right. And it's like, you know what, I'm going to, that's why we tell people to do things at the speed of cash and yada, yada, yada. We sound like a broken record, but what we're doing is we're giving people margin in case something happens, which something does happen. And so, but if you sit down with your husband and say, I don't feel safer anymore, either he's going to go next door and say, hey, can we just talk

about this like adults and come to some sort of understanding here? My wife's scared. Y'all hate us as neighbors. Can we just solve this? Or, all right, we're going to put the house in the market and we're going to go. And we're going to rent for a couple of years. We're going to save some money up. We thought we were going to do the cool old house with lots of quirks but we're going to fix it up and we're not those people yeah because is there more to be done hannah more than this 90 000 heloc would you guys have to put more money into the house oh yeah yeah so i mean like so it kind of feels like a lose-lose, bad purchase, bad neighbor situation, right? Yeah.

So you guys have some credit card debt. Do you have any money saved? Just the $1,000 emergency fund. Okay. So if you sold this house, you could use equity and clean up everything, look at each other and go, we are not those people. We're not HGTV people. We thought we were, but we're not.

So cool. We're going to rent for two years save up you'll walk around with around 50 000 in equity um that'll go down some with realtor stuff and you know fees and commissions but you'll walk away with some and yeah and i think you guys um rent for a while and there may be a it may be a start over process for you. But again, the peace of mind is really big, Hannah. You were shaking talking to us. I don't know if it was because you were nervous because me and John or the situation brings so much emotion, but I heard it in your

voice. There is a peace of mind there and the fact that this is a money pit of a house, it just wasn't a wise purchase. Looking at other options, it might be the case and knowing that you'll be renting for a bit. But if that brings peace of mind, that brings peace of mind. I'm with you. I'm with you. Hey, we'll be right back. This is The Ramsey Show. Hey, check this out. A brand new event, Dave Ramsey's Investing Essentials. At this event, Dave is going to deep dive into investing. And for

the first time ever, he's sharing his personal playbook on investing including how he buys real estate this is not just the broad principles he is i kind of bummed out rachel because this is what i thought the cool part of working on the show was is we hang out with dave and i'm like hey would you buy this and he's like no and here's why or yeah i totally wouldn't here's why i thought i kind of had an inside track and now he's like i was, I was going to tell America. Just tell everyone. So here it is. A two night virtual event happening May 21st and 22nd. I can't do two nights. Yes, you can. You watch the World Series. You can do two nights. It's a two night virtual event to change your investing future. May 21st and 22nd. And you can watch it from the comfort of your home. It's all online.

Investing is something you've been asking us to dig deeper into, so here you go. You're going to talk about the basics, then we're going to deep dive into specific things, mutual funds, types of mutual funds, real estate, why Dave doesn't do other things. And by the way, this isn't just theory and principle. This is what Dave does with his family's money, with his personal wealth. You're going to learn how to maximize your 401k, mutual funds, his personal strategy, Dave's, and which investing trends to follow and which ones to run screaming from. Tickets are $199. Go to ramsaysolutions.com slash events. Let's go out to Indianapolis and talk to Allie. Hey, Allie, what's up?

Hi, guys. How are you doing? We we're partying what are you up to oh just waiting on the line talk to you guys so i just have a quick question for you all right bring my husband and i we have about 38 000 left on our debt snowball and recently last week we had a hailstorm at our house and our cars are considered a total loss by the insurance it's all cosmetic damage though um and insurance is going to give us a check for about ten thousand six hundred dollars so we were wondering if we should put this money on our debt snowball wait they totaled both cars and all you get is 10 000 bucks yes but we drive 2011 you know oh ali i would high five you yeah and it is all cosmetic like you're it's running fine yes they run yeah i'm throwing it at the dead i would i mean they're old cars you know it's

funny ali there was a uh my husband's from knoxville and there was a terrible hailstorm in knoxville like it's probably i don't and there was a terrible hailstorm in Knoxville. It's probably, I don't know, this was years ago. And we came in for a weekend, and every car that was driven down the road had hail. I mean, literally, almost every car had hail damage. And we were laughing. People just cashed in. In West Texas, where I'm from, there's one every month.

There's a wild hailstorm. You live there, and your car is going to be all dinged up. So y'all won't be the only ones. People treated it like a tax refund. Like, we got money. And I was like, no, it's not like a gift. But yeah, hey, I would, Allie. Yeah.

If it was a 2022 Lexus, I might go get it fixed. But your cars are depreciated all the way out to the very bottom anyway. And so, yeah, get out of debt. Okay, yeah, that's what we thought. So we just wanted to talk with you guys, though. Awesome. Yeah, good on you. Well done.

Thanks. Congratulations from the hail gods. All right, let's go out to Philadelphia and talk to M-A-T-T. What's up, Matt? Hey, John and Rachel. How are you doing? We're doing fantastic, man. What's up?

Awesome. So I have a question. This is also vehicle related. I had a truck that I've owned for about 12 years, 2000 Toyota Tundra. And I had gotten a newer truck and was looking to get rid of that truck. And my 16 year old son was interested. So I told him, Hey, it'd be awesome. If you get dad's truck, he didn't have the money to pay for it all obviously upfront, but, um, I told him you can make

payments to me as you can. He had a side job while he's in school and, um, he's been paying, you know, a couple hundred dollars a month for a little while. Uh, anyway, he's paid probably $1,400 and yesterday, uh, he totaled the truck. He is, he is perfectly fine. Um, but the truck is truck is done for, and I only carry liability insurance on it. So it's going to be a loss, straight-up loss. And my question is, as a dad, what should I do to help him to learn a lesson in responsibility and reality and yet not overburden him financially. How old is he?

I can absorb this loss, but... He's 16? Is there anything I should do? Yeah, he's 16 years old. All right, Rachel, I want you to disagree with me, but I'm going to give you my, from my gut answer. I don't know. I know.

They're just so young. And Matt, my son is 14, so I'm right there with you. Okay? Okay. I would take my son out for lunch, just us two, and say, we're going to talk about the truck. And I would tell my son, if I had done what you did, son, I screwed up. I put you in a position to borrow money on a vehicle,

and I never should have put you in that position, and that's on me as your dad. Yep. You've lost this truck. I put an object, I put debt between our relationship, and that will never happen again, and I'm the old man here.

I'm the dad. That's on me. Yep. Now, you are out of a truck you're gonna have to earn your money back and if you like you say if you're in a financial position the deal i've made with my both of my kids is i'll do half you save up and earn it i'll i'll double whatever you got and so maybe you make him a deal like that or whatever you can do. I like that. But he's got to have some skin in the game because he wrecked it. Yeah.

But I think the relationship stuff, the healing there, it's got to come from you. The debt part, you got to say, dude, I did this to us. To us. I did this. I should even give you this truck or whatever. But here we are. And what you're going to do is his shoulders are going to – he's going to say, I'm sorry, dad. I'm sorry. I should even give you this truck or whatever, but here we are. And what you're going to do is his shoulders are going to, he's going to say, I'm sorry,

dad, I'm sorry. And you say, no, no, no, it's not your job to make me feel better. I'm the dad. I did this. I'm glad you're okay. The thought of losing you just kills me. And take this lesson. You and I are never going to borrow money again.

That's what I would do if it was my kid. And there's probably thousands of people listening, millions of people going, oh, that guy's weak. You should crush him. I think you put him in a position where he's going to borrow money from his dad. Yes. He's 16. How much did he give you, Matt, in payments? So far, $1,400. $1,400. Okay. And was the wreck his fault? What was the situation? Yeah, it was. It was a one-vehicle accident, and he was driving on a gravel road and lost control.

Okay. Was he, like, on his phone? I don't even know if you want to go into all that. Wait, that's another. Yeah, was he on his phone? Was he texting and driving? I don't know. I don't know.

I don't think he was being extremely irresponsible because i'll tell you this matt rachel at 15 and i had my own car at that point because i had saved up and paid cat i paid half of it we did that we did the 401 dave thing and i got in a wreck outside of my high school with a permit so my mom's in the passenger seat and it ends up being a five car a five car pileup the last car was some guy who i mean it was probably a thousand dollar car it ended up catching on fire the engine caught on fire and they had to call the fire department can i just say at 15 i my the the lesson was learned like it was learned i was so it was horrible it was horrible the whole thing i learned

and now i don't get close to cars that are stopping at stop like i'm like i'm very aware of the distance so all that to say does he need to quote unquote learn his lesson i bet he's learned his lesson at 16 like that sucks you know you you told him a car like he knows he knows and i just i don't know and then there's a part of me again I just think about my son such a mom with a son I almost would say that 1400s a credit to the future car because it's payments to you I would do that I'm not I'm not quite as soft as Rachel but I don't know because I just I don't know because he's gonna have to work hard it's gonna take him a while to save up money at this point to pay for another car or half of a car or however you just do it matt um but here's

what here's what's not broken the the your finances aren't broken what's what's in flux right now is your relationship let's fix that let's let him know it was on me i love that it was on me it will never happen again you and me are making a pledge from this point forward we're never borrowing money again and that puts weight on the subject of debt heavier than ever before. If my dad is telling me I did this and I will never, and you're like, oh, it is a bad thing, right? Like you're learning that lesson in real time too. Good on you, Matt. He's lucky to have you as an old man.

We'll be right back. Welcome back to The Ramsey Show. I'm John Deloney, joined by Rachel Cruz. And we have somebody cool on the debt-free stage. We have Josh. What's up, man? Good to be here. Thank you.

Where are you here from? I'm Greenville, South Carolina in the upstate. Greenville, South Carolina. And I'm assuming since you're on the stage, you've paid off everything. Talk us through it. How much have you paid off? I paid off $96,000 in three years and five months. Wow.

Nice. 96K, three years and five months. Making what kind of income? From 62 to about 70 or so with a bunch of side hustles in there. So that's the base roughly. Amazing. So great. All right.

So tell us, how did you get connected with this wild crew of people well about five or six years ago I was approaching halfway in my career and really wanted to prepare myself for retirement I'm a planner like way ahead planner and I put my my spreadsheets together and calculators and everything and realized I was in pretty good shape but I looked over and I had a truck and a mortgage that I really didn't want to have in retirement. So you paid off your house. Your house. Oh, that includes the house. Way to go, dude.

Congratulations. Yeah, $3,000 of it was a truck and $93,000 was the house. Oh, my gosh. It was left in the house anyway. So you're done completely. Unbelievable. Unbelievable. But I was wanting to pay everything off.

And so I looked at the math because I just like the math part. And I paid extra on the mortgage because that higher interest rate than the truck was. Did that for a couple of years and it was okay. But then 2020 happened. We got sent home. So I found a podcast and found y'all's. And y'all said pay off everything except the house first. So I looked at it and

realized that if I really went after it I could pay off the truck and pretty quick so about four months into I paid the truck off it was just quick and then which felt really good so I said I'm gonna go ahead and see if I can do the house also so I put money to retirement I still did that but I kept paying extra and extra and more and more side hustles to get the house paid off. And originally I have it paid off in January of 2025, but the more I kept paying on it, the more side hustles I picked up. I kept pushing that payoff date up a little bit, ended up paying it off in September of last year, actually. Oh my gosh. So like a year and a half, or I mean close to a year and a half. More than a year of your life.

Right. Unbelievable. That's incredible. So what kind of side hustles did you do? Actually, I had to write that down because I had so many. I'm a teacher by trade, so most of it was through that. But I tutored after school. I still do that nowadays. What got me the most money is I sell tickets to sport events at school after school. Oh yeah. So I do that once or twice a week, get paid anywhere from $30 to $100 a night, depending on how many games there were.

A couple times a week, that adds up real fast. A teacher paid off his house, debt-free completely. And, hey, let's not – I used to do that. I used to teach all day, and then I would go work a volleyball game or sell tickets. It's miserable when you get there at 6 a.m. You don't go home until 10.30 p.m. night after night after night, right?

That happens quite a few times. And those same kids are like, oh my gosh, Mr. Josh, why? And their parent, and you kept doing it and you kept doing it and you kept doing it. What a sacrifice, man. I got to know a lot of the parents because I saw them every night anyway for the game.

So they said, you're here again. Okay, so how much is your house worth? $2.80 right now, I believe. Okay, and how much do you have in retirement? Oh, 350. Oh my gosh. On your way. Easily to be a millionaire. All right. So what are some of these other jobs? Because everyone tells us we can't do it. You can't do this anymore in modern day USA. Let's see. I did, I grade AP chemistry exams. I do that every summer. Oh, that's's the worst do you go out on the beach to do it though well it was in salt lake city the past few years this year's in tampa so yeah there's there you go i'll do that okay um i did summer school last year for the first time ever and my favorite thing though is my district owns a

planetarium and part of a science center and out of the blue a couple years ago the planetarium director called me up and said, I see you teach astronomy. Do you want to do a public program once a month, like one Friday night a month for the public? And I said, I would love to. So I get paid the least for that because it's once a month. That's more fun than anything else I do, though.

You're an astronomy professor? I'm a chemistry and astronomy teacher, not a professor. A teacher. All right, hey, we're going to pause this debt-free stream real quick Rachel and I have an ongoing stop did we land on the moon or not absolutely we did I knew it I knew it solved and earth is looks like this too I do think it's round I don't think the earth is flat I'm not I'm not that back Josh oh my gosh you made my whole week man thank you so much I appreciate that go. Golly. Okay, time back in. Jeffrey, scream back on.

Here's what I love about you in this whole situation. That you're right, number one, about the moon. Is that you took what you're already great at, what you're already doing, and you just expanded, right? The environment, the school, right? Doing sporting events. You took what you're good at, the knowledge you have, and that's where you plugged in. And that's where you end up making so much money our friend jade warshaw

i mean her and her husband sam musicians and they they did private music lessons like you find the thing you're good at and see how you can make money right you can drive for uber and do all of this but there's something about what you're saying that i think is so brilliant and so great and and causes people to be creative oh yeah when they have to go find a side hustle how many of your students would ask you ahead and like seriously what are you doing well how many kids did you get to share this this journey you're on with well i don't i don't really talk about it at school very much because i want to yeah i talk about i try to get my students not to get off topic and i could talk about this forever so i try to stay on topic for that

i needed you as a teacher growing up because I get off topic quite a bit but my astronomy students though we talk about everything anyway because it's just it's such a fun class yeah like they'll say do you see this movie the other day and we'll talk about how bad the science and what and it was or if you like talking to a friend who's just is so clueless on actual science. Right. And you can help them how to discern friendships. Yeah, there we go. Dude, that's awesome, Josh. Back to you, Josh.

Yeah, so hey, what's something you would tell somebody who is, did you do this all by yourself? I did. Okay, so you're all by yourself. Teachers don't make a jillion dollars. And you said enough is enough is enough. I'm going to do this. What do you tell that person sitting at home saying, I don't make a jillion dollars and you said enough is enough is enough i'm going to do this um what do you tell that person sitting at home saying i don't make enough money i'm all by myself

i don't have a spouse making five hundred thousand dollars a year what do you tell that person well there are ways to do it again there's side hustles whether it's through school or not there's things you can do for most most schools anyway and one thing i did when i was selling tickets you know we have to grade papers all the time and do planning and all that stuff, which is a pain in the butt sometimes. But when I was selling tickets, it's a big rush the first like half an hour before the game starts or right after the game starts. But most of the rest of the time I'm sitting there just twiddling my thumbs. So I brought my work with me and just graded papers then. So I got paid extra for doing something I would do normally anyway. But how do you breathe if you're not scrolling social media

in all of your spare seconds? Yeah, I stay awake as as i possibly can so god grief i don't even make guys like you anymore josh you're amazing i'm on some on like facebook that's i mean that's ancient now but yeah my students now laugh at me because they're on whatever i don't even know what's on right now but they're on other stuff so great i bet they love you uh so someone listening or watching is thinking okay i'm gonna i'm gonna do this. I'm going to try this. What would you say the key of getting out of debt is? For me, it's have a goal. I wanted to pay my truck off quickly.

I wanted to have my house paid off by January of next year, but I had it paid off early. I want to retire, be able to retire by the time I'm 55. I'm 43 now. I should be able to, but I'll probably still work anyway. It's still fun. Yeah. So it's just have a goal. Just not have to pay anybody

any other money for me. Here's what I like about you, Josh. You don't seem like the dramatic type, which someone next to me may have a level of that in his life. But there is something about, you just do it. You know, and like talking to you,

like there's so much, you know, drama that can be associated with this where it's like, just cut stuff out and just do it. And that's the vibe, as the kids would say, that I'm getting from you, Josh. So what are you going to go do? What's the thing you're going to go do? Well, two things. One thing, I've got a cruise this summer.

Yeah, that's good for you, man. But also one thing I did last month, my favorite band in the world, Journey, was coming through Greenville. Don't stop believing, Josh. Exactly right, yeah. So last, I was looking for tickets a few months ago, and I was going to usually buy the mid-level or up-level tickets just to get in the show,

but I realized I don't have a mortgage payment anymore. Ah, so good. So I splurged, but I sat third row center at that concert. Yes, you did. And had a blast at it. It was so much fun. So good.

It was a great time. Somewhere there's a YouTube video of Josh, no shirt, jumping off the stage. Absolutely not. All right, let's get to it. $96,000 paid off in three years and five months, serving your community. You did it, house and everything. My brother, Teacher Josh, let's hear your debt-free scream.

Three, two, one. I am debt-free. Yeah! Three, two, one. I am debt free. Hey, Rachel, you said something so important. If we could all just strip the drama away and just go do the thing. Just do it. Just do the thing. So good.

Josh, you're my hero, my brother. Well done, Josh. And thanks for being a great teacher. We so, so appreciate. Amazing teacher. So thank you, Josh. You can too, America. You can too. We'll see you soon. Today's scripture of the day is Psalms 39, 14. I praise you because I am fearfully and wonderfully made. Your works are wonderful. I know that full well. The great Maya Angelou says,

if you're always trying to be normal, you will never know how amazing you can be. That's how we know how amazing Rachel Cruz is because she never even tries to be normal. Oh my gosh. You know what? Conspiracies just make the world go around you know we ask the question crash it not everybody they just destroy the world let's go out to charleston south carolina and talk to john what's up john hey guys how are you all today we are

rocking on to the break of dawn brother what are What are you doing? I'm still working. I listen to you guys all the time, and I think you're the only ones that could probably give me some good advice on this. You need better friends, number one, but we could probably help. What's up? I don't have too many intelligent ones. No, I'm just kidding. So my father passed away last year. Um, and mom got, you know, mom's doing okay.

So mom had her will written up and I told her I didn't want to be a part of anything that she would be writing, you know, do it on your own. Uh, we recommend a good attorney to her to go to. When I did get to see it, when it was all finished, I feel very uncomfortable with what she did. I don't know how to see it when it was all finished i feel very uncomfortable with what she did i don't know how to handle it um 50 to myself 25 to my sister and 25 to my daughter and the house has to be sold and i and i know why she did that but why did she do that my sister was a homeless drug addict and um she was homeless for about three years before I found her again. She's since got her life back on track, and everything is great with her.

I mean, I give her nothing but huge praise for what she's done. But she's the type of person that she's all there, but she doesn't have a driver driver's license and she doesn't care to get one. She doesn't have any friends, which, you know, whatever you want is fine. I mean, she,

but she does go to work every day and her job means a lot to her. Um, she takes public transportation to and from, and she's living on a premise that the day that my mom is gone, that the house is just going to be hers. And, and your mom probably is wise enough and is grieved. The county would get it in a year because the taxes wouldn't get paid off.

Well, and what I'm saying is your mom knows the whole, she is wise enough to know that the worst thing I could do for my daughter is to give her a home. The worst thing I could do to my daughter is give her half of everything I have. But I could give it to my son who I trust. And if he sees best fit to take care of his sister and however he's going to do that, I trust him. And so what I don't want you to do is I don't want you to pass that responsibility back to your mom. Correct.

It's going to be hard. It's going to be tough. But you know as well as I do, that house is gone in 365 days. And then what do you do? Do you just gift it to her? I mean, I, so. No, you sell the house. You sell the house and you take the money. And I would probably sit down with my sister and say, here is number I mean how much money we talking a hundred thousand dollars she would

would go to her there's probably six figures in the bank the bank the house is worth 300 ish okay and and the money doesn't even whatever I would inherit wouldn't change any day-to-day in my life. I mean, I've worked very hard. I've made everything on my own. But I'm not wealthy. I know, but listen, you know as hard as the conversations will be, handing your sister a check for $100,000 might kill her. Correct. I'm scared that would send her down a bad road.

Right. And so it almost sounds like the conversation is one more step, which is, hey, mom, I will take care of my sister to the best I can. Yeah. But let's not leave 25 percent to sister. Well, to the point where I wanted to get her an apartment and, you know, I was going to front it all. And then, you know, my wife's like, no, if your name's on that lease, no, just be prepared to pay for everything. And, you know, whatever she said, you know, I agree with her. So I didn't go down that route. But I don't know. It's going to put me in a tough spot one day. Yeah, and your mom, how old's your mom?

So she's 67, 68, but she's in really good health. She's a really active go-getter type person. Yeah, so you never know what life could bring you, but there could be a chance for 20. Yeah, yes, but also she could be living 20 more years. Easy. In all of this and the way life shakes out. Correct.

But I think. think it was anything drastic that would probably be safe to say right right so there is a part of me that you know worrying about something that isn't in it isn't imminent you know is one thing but also i think it is always wise and it would be your mom's choice to do this but we always say that once you make a will to communicate that to everybody involved um now a situation like this i don't know if that's more of a gift or more of a you know turns everyone inside out it gets to be a mess yeah yeah so i you know depending on how your mom wants to communicate it or if she does but again i know you're planning for what if but thankfully it hasn't happened yet well and correct

john there's this is going to be hard. There's not going to be an easy path forward. You're going to be dealing with a sister. Is she older than you or younger than you? So she's six years younger than me. Okay. And I was the one that brought her out

for where she was. And we have a good relationship. No, I know you do. But you have a sister who's six years younger than you that probably has no retirement, has no or limited insurance, health insurance, life insurance, etc. So you are being wise to look down the road, whether it's 10 years, 15 years, 20 years, 30 years, there may come a day when you're going to be charged with the care of your sister.

Correct. And so I think there's some wisdom in putting your cards on the table, having that conversation with your wife. Like I think your wife is smart for you to not put your name on a lease. I also think you need to be honest about telling your wife, I can't just let my sister go back under a bridge, if that's going to be your thought process. So what do you have to do now, wise to make this thing happen but i think in some weird way you were hoping that your mom's will would kind of ah it's not on me feeling yeah and it's it's just that's not who

you are you're a man of responsibility you're a man who loves his family you're a man who went and got his sister dude and i could get choked up and hug you. We need more men like you, and there's not going to be an easy path forward. There is a path that you can plan for. And don't violate you and your wife's marriage covenant. But, dude, I think it's just being wise about what's coming down the road, however hard those conversations are going to be. I sure do. I appreciate the insight on that i really do yeah you bet you and also i love what rachel said keep this in mind um if you come from a tough home it growing up was tough um sometimes we solve tough childhoods by over planning

correct we try to grab variables out in the ether before they're even issues and solve them before they're problems, and you're reaching way into the future, hopefully. Yes, yes, correct, 100% on that. I mean, that's, yes. I mean, everything, like I said, anything can happen tomorrow, but I was just wanting to try to wrap my mind around it and get my duck somewhat in a rush yeah down the road you know sure which is totally fair you're a good you're a good guy man that's that's yeah awesome awesome awesome thanks

for calling I know because that conversation between even with him and his sister even down the road right you look 10 years 20 years and it's still like what is the what is a gift to someone what is enabling someone when is it my responsibility when is it not and we've had a lot of calls on this show of people of adult children that are like i have to take care of my parents uh there was a call you know i don't know if it was recent but the parent was making like three hundred thousand dollars a year and just burning through it yeah and it's like where where is it your responsibility to quote-unquote honor right your parents and all of that you look at brother sister relationships you look at friends but i feel like you do a good job of just knowing what's what's

the healthy boundary here because there is a boundary there is a boundary and it might be i think where people may misconstrue it i'll say me, if my parents have burned through all their money, I'm not going to not take care of my parents, but I'm going to take care of them in the way that I can do it. And if I can only afford X place, then that's where they're going to have to go. I'm not going to mortgage my future

and my soul for some big fancy sub-brother. Right, taking care of your immediate family first. And that's the same with John, taking care of his immediate family first. So that he can take care of them. And then beyond, yes. Well, hey, that's the third hour here on taking care of his immediate family first. So that he can take care of them. And then beyond, yes. Well, hey, that's the third hour here on the Ramsey Show. Thanks for being with us. Thanks

for all the gang out in the booth, especially Taylor and Emily and the Mighty Joe. We'll see you soon, America. Hey folks, Dave Ramsey here. You know, budgeting doesn't have to be boring. You just need a budgeting app that's made with you in mind, and that's EveryDollar. The EveryDollar app has helped millions of people work the baby steps and take the stress out of planning and managing their money. Start budgeting with EveryDollar for free right now.

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