The Ramsey Show - Building Wealth Starts With Setting Aggressive Goals

Episode Date: December 9, 2024

📈 Are you on track with the Baby Steps? Get a Free Personalized Plan 📱Listen to the full episode for free in the Ramsey Network app. Watch United States of Anxiety exclusively on the free Ramsey Network app! Dave Ramsey & Jade Warshaw answer your questions and discuss: "Should I invest in a whole life policy?" "My mom has a bad plan, how do I talk her out of it?" "Should I put down less than 20% on a home?" "My wife wants to leave me after I hid $26K of debt," "Should I buy my friend a car?" "My 401(k) was closed without my knowledge" Support Our Sponsors: 🌱 Get 10% off your first month of BetterHelp ◎ Get 10% off Byrna product bundles and more! 🏥 Learn more about Christian Healthcare Ministries 🏡 Get started today with Churchill Mortgage 🔒 Get 20% off when you join DeleteMe 🏦 Go to FAIRWINDS Credit Union for an exclusive account bundle! 🥗 Save 15% on your first Field of Greens order with code RAMSEY 💤 Visit Helix Sleep for special offers! 💻 Visit NetSuite today to learn more 🗂️ Use promo code RAMSEY for 18% off at The Nokbox 💵 Learn more about Timothy Plan 🏛 Get started with YRefy or call 844-2-RAMSEY 🔐 Visit Zander Insurance for your free instant quote today! Next Steps 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 🎟️ Get $100 Off Money & Marriage Getaway with code CHRISTMAS. 🎄Hurry—Your chance to win $5k is almost over! Enter the Ramsey Cash Giveaway today! 💵 Start your free budget today. Download the EveryDollar app! 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

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show where we help people build well, do work that they love, and create actual amazing relationships. Jade Walshaw, Ramsey personality is my co-host today, number one best-selling author, and we're here to answer your questions about your life and your money. Open phones at triple 8, two five five two two five Andrew starts off this hour in Miami. Hi Andrew. Welcome to the Ramsey show. What's up? I'm not too much Thank you so much for having this to me. Mr. Ramsey sure So I had two questions regarding whole life insurance I know your general principle, but I've never actually heard you discuss these two characteristics of whole life insurance or these two scenarios

So I was kind of curious of your opinion Regarding this subject if you don't mind sure I'm an expert on my opinion So the first question is like this Today in America if a person is a single person is earning a hundred fifty thousand dollars a year or less They can put up to seven7,000 into a Roth IRA. That grows tax-free. But at $150,000 after taxes, about $130,000, a single person pretty much anywhere in America still has plenty of money. So let's say you're putting money into that investment brokerage account. My question was on whole life insurance, it also grows tax-free. I know it doesn't have the same rate of return, but if a person wanted to increase their long-term

tax-free savings, would that still be, would that be something you would consider as a viable approach that they've already maxed out their Roth IRA or if they have a company that's a Roth 401k, the sale can only max out at $7,000. How long ago did you take your job selling whole life? I have actually, I've only sold a couple of policies, but no, I'm not actually involved in the industry specifically. How did you sell policies if you're not involved in the industry? I am a licensed agent, but I haven't done it in a few years.

Because you pretty much spouted their line perfectly This is the whole life sales line. That's how I knew you were selling it You nailed it. Yeah, like you were just trained like three weeks ago It's wait. That's what it sounded like not picking on you, but you this is that you you are Representative of the industry. Okay, so let me help you with this. Let me help you this whole life Whole life does not grow tax free unless you lose money and your basis for tax purposes in a whole life policy is the total of your premiums. So if you pay in $100,000 over a bazillion years into your whole life policy

and your cash value is ninety thousand dollars you have lost ten thousand dollars and so of course there's no taxation or you can borrow your own money and pay them an interest rate to borrow your own money and by the way one 100% of the time borrowed

money is not taxable. So whole life in and of itself does not grow tax-free. That is a falsehood. If it actually made money and you took the money out it would be taxable. But they never do because they suck so bad. The rate of return is horrendous and the fees are so high and so no I would never consider that as an option. Instead I would listen to if you put your money in a fruit jar as your side investment after you maxed out a Roth you're gonna end up with more money than you will screwing around with the whole life policy

because they lose money I'm impressed that you sniffed that out as quickly as you did Too much time in 30 years being hated on by whole life people. So that was pretty impressive Well, I mean the the it's a scripted thing that clearlyed thing that it's a tax-free growth, which is a complete lie, y'all. It's not tax-free growth. If there is growth and you take it out, it's taxed, period. But there never is because the rate of return is so horrible and the fees are so high.

So here's the way whole life works for those of you listening. And he's talking about it as an investment only, but let's talk about it as an insurance product which is what it is purported to be. And that's, you only have to have a life insurance license, not a securities license to sell the crap. So the, which is easy to pass. If you can roll out of, if you can, if you can roll out of bed, you can probably pass your life insurance exam. It's not

that hard. Securities exam on the other hand, very hard. Now, whole life is 20 times more expensive than the same amount of term on the same person. So a 30 year old buying a hundred thousand dollar policy if say for instance they did that for five dollars whole life would be a hundred dollars okay so where does the extra ninety five dollars go above the cost of insurance because term is only insurance that's right it goes into an investment called cash value which is what he was bringing up okay the investment called cash value, the first three years on a whole life policy, your investment growth is zero. 100% of your $95 a month

in our example, the extra 19 times you're paying for this, you get zero in your investment. So you open a bank account and you put in $95 a month for three years and the balance is zero. No one would do that by the way if they understood that. They do it all the time but no one would do it if they understood that. You're right. Which is our goal here is to make everyone understand it. Then once it does start making money the average whole life policy in America today averages 1.2% with an inflation rate of 4.7. Losing money. And so after you get past those two things here's the worst part

of the whole thing. See this little couple buys a hundred thousand dollar whole life insurance policy they pay into it for 20 years they have 20,000 bucks in there finally after they got 1.2 percent and has nothing for the first three years and then he dies you know what they pay they pay the life insurance just the premium the face amount what happened to the money I've been paying ninety five dollars extra to build up in my savings account insurance company keeps it you do not get the face value plus the cash value well let me ask this cuz I let me finish so you have a savings account that the

first three years you put money and they keep all of it after that you make 1% on it and when you die they keep your money who would open their savings account nobody but people do every day it's the biggest let me tell you it's the payday lender of the middle class it's crap crap. Sorry Andrew, but you asked. So when do they, a guy like Andrew, if somebody said, I'm interested, let's say they had built up a certain amount of cash value. When would a guy like Andrew say, here's the right time to get at that money. So, you know, it's all a risk game, but so that you can get it before you die. Well, you can't get it before you die. The only way you could get it's all a risk game, but so that you can get it before you die.

Well, you can't get it before you die. The only way you can get it is cash the policy in. Because if you borrow the money out before you die, they repay the debt to yourself to make sure they keep the whole cash value before they pay out the face value. So if you borrowed 20,000 and $100,000 policy and you died with the loan out,

you get 80 instead of 100. They pay back the loan so they get, make sure they get to keep it. Wow, wow, wow, wow, wow, wow. So the only way to get to keep the money is to cash out the policy. And then at that point what was, why get it to begin with? And you have lost money on it so it's not taxable.

Terrible, terrible, terrible. So no you're better I'll put money in fruit jar darling least when you die. It's there Assuming the family knows where the fruit jars buried but be careful with that one that did happen to one of my relatives We got we got we got cousins out there with metal detectors in the backyard trying to figure this one out, but Don't do that. Don't do that one either This is the Ramsey Show. Hey everybody, listen to this. Helix, who makes the best mattresses on planet Earth, actually throughout the universe, they've

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Thank you for joining us. Open phones at 888-825-5225. Hayden is in Nashville. Hi Hayden. Welcome to the Ramsey Show. Hey, thanks so much for taking my call. Appreciate it. Appreciate everything you do. Thank you. So basically I'm calling about my call. Appreciate it. Appreciate everything you do. Thank you.

So basically, I'm calling about my mom. I'm very concerned for her. She has a bad track record for being financially smart. And recently, she just got into a relationship that's only been about six months. And he has a lot of money. so she thinks that she wants to quit her job and live off of his money and then sell her house and then that's her retirement so I don't I just don't really know like how to give her advice and she has asked me for advice she did ask interesting she she did ask okay so the one thing that changes the whole discussion is the marriage date when are they getting married that's exactly my point as well like I'm telling her you're not married

before you decide to your job or decide to move in with him like but is there if you quit your job and move in with somebody and sell your house that's rich that's called a sugar daddy we have a name for that guy really I don't care he's a sugar daddy no he might be a nice one but that's what he is no you don't do that mom. How did you get to be mom and not know that? Trust me, I don't know. So what have you said to her so far about it? What have you told her so far? He wants to take care of her and she you know He supports her in any decision she wants to do if she doesn't want to work anymore. That's okay

She'll you'll pay for you know, all the bills and she wants to do. If she doesn't want to work anymore, that's okay. She'll, he'll pay for, you know, all the bills and she wants to sell her car. She also has a, she has 20,000 on her car right now. Um, 8,000 in credit cards. You know, she's not good with her money. And I'm saying what have you told her about this? Have you told her anything? Yeah, I told her, I told her that one, she needs to get married. If she wants to, you know, rely on his income. Did you tell her why? Oh yeah for sure. It's hard for her to listen to me because like I'm not married so.

Ah okay another strand. Well it's you're her kid that's strand one. And that's another thing too. Yes and then you've not been in the type of relationship that she's been in, at least that's the way she's gonna view it, which is true. So you're fighting a, like you're fighting a current 100%. Let me tell you what, if you ask your mom's dad, he's probably gone, right?

Yeah. Yeah, but if we were to ask him. They didn't have a good relationship. They didn't, that's probably not a good example. If we were to ask her uncle He would have said no, I'll bonk him on the head. No right Or I mean even if you flip the script and put yourself in that situation Although I I would love to think that she would tell you to do the opposite But she might tell you the same thing that she's doing so she would smell that one out. Um, I

Don't you know your question is how to convince her of what all three of us know that this is a bad idea okay yeah so I guess the thing is this okay here's the thing anytime mom you're making a great huge decision and there's a series of great huge decisions you're making here you have to play out the decision is it a happy happy decision. Now the way that works is this, you're happy if this works and you're still happy if this doesn't work. If it all works and you just play house and the sugar daddy takes care of you, it worked, you're happy. That's your plan. But what happens if he dumps you in the street

for a 10 year younger version, trades you in on a new model mom, because he can do that pretty easily here by waving the exact same carrot he waved in front of you and be sugar daddy to somebody else. So when he puts you in the street with no house, no car, and no job, where are you going to be? Mm-hmm. Exactly.

You don't make big decisions like this, mom, when one of the possible outcomes is devastation. Mm-hmm. Bad risk management. Bad lack of wisdom. Right. Lack of wisdom. And I'm also just not in a position financially to help her. She's asked me in the past for money. That doesn't enter into how stupid this is.

Right. Whether you give her money or not doesn't mean this is smart. And you're going to have to accept the fact that she's going to do, you could lay out the best argument in the world, like perfectly just eloquent, everything makes sense, and she could still go and make this choice and it's gonna be bad for her. And you're gonna have to just learn how to live with that and accept the fact that she's a grown woman and she's making a bad mistake and there's nothing,

in many ways there's nothing you can do about it. And I think that that's the hardest part of being in a relationship with anyone that you really care about is they get to choose. Is there anyone in her life that's wise that she trusts? Her brother. Have him call her and scream at her I'm serious. She really he he really likes the guy so I haven't seen him like I said I asked if he was wise

Oh If he's wise he doesn't think this is a good idea I'm not saying the guy's a horrible guy I'm saying this a horrible deal for your mom without put a ring on it, buddy Well, the guy probably thinks if this is a I'm gonna say in air quotes a good guy This guy probably thinks he's offering your mom the world So maybe somebody needs to get in his ear and make him see hey the world. So maybe somebody needs to get in his ear and make him see, hey, we like you,

we think that you're probably trying to take care of our mom, but can you do this the right way? Because this way, the way that you're doing it now makes us nervous, because if for some reason it doesn't work out, she's on her butt, right? So maybe that's the way to go at this, is if there's somebody that has the right relationship to talk to him, if he is really the good guy

that you guys say he is, that should give him a light bulb moment to go oh I get it yeah right put a ring on my mom just needs a reality check to the problem is she's not looked at the downside anytime you're making a big decision you have to look at the downside what's the possible negative outcome from this and it'll keep you from doing some stupid butt stuff if you don't only consider that you know sunshine rainbows and skittles you know it doesn't always turn out sunshine rainbows and skittles especially when the deal is set up poorly from the start you're kind of asking for it you're asking to have your butt kicked life's gonna come along go you was stupid here's your butt kicking ready here you. And we all get to pay some stupid tax. We've all done some

stupid butt stuff and she's signing up for one here. This is a trip that's gonna be harsh. Please don't do this lady. Please don't do this. Put a ring on it or don't do it. It's pretty simple. Because I gotta tell you, it changes the chemistry. Well I was gonna say there's no like balance of power in this relationship. She sells everything she has. There's no way in the world she could live in a house probably that he lives in on her side.

You know what I'm saying? She has no ability to keep up life. We need to bring back some of the vernacular from bygone eras. Let me hear it. A kept woman. You ever heard that one? Yes, that's very I

Don't want to say the word old but that's that's ancient. Yeah, that's a kept woman She's being kept. Yeah for her use. Yes. Oh Yeah, I'm gonna give you a little chill gives me a little chill I don't like it my dad's stuff my grandpa stuff gets her angry right. So I just can't, put a ring on it. Michael is in Charlotte. Hey Michael, what's up? Hey, I'm good, how are you doing? Better than I deserve, how can I help?

I had a question. My wife and I are in the process of buying a house. We were pre-approved and our loan officer told us she doesn't advise 20% down payment or in North Carolina. She says the appreciation rate in North Carolina. I don't advise you using this law officer. She's stupid. Yeah, I figured you would say something along those lines, but I'm just, I don't, I have a hard time understanding how that works out.

Well, her thing is that borrowed money has has no risk so borrow all you can. My thing is I've met people who are up to their eyeballs in a mortgage and can't get out they're stuck because of some idiot loan officer like this. By the way she gets paid on what? what's her percentage on the loan amount? Conflict of interest in this advice hello Hey, you know our money if you don't put down so much He needs to go to our real estate hub and find some folks who are gonna actually help him go to Ramsey solutions calm slash real estate there it is that's easy a whole bunch of stuff there that'll help you Michael But she's getting paid on that you do need need a loan officer. This woman's not smart. This is The Ramsey Show.

I've been doing this show for over 30 years and some of the saddest calls I've taken are from situations that are completely preventable. Yeah. And what's so hard is I feel like one of those, especially the ones that I'm like, oh, it's terrible. People that call in and their spouse has passed away suddenly and they don't have life insurance. When you have to think through how am I gonna pay my bills in the middle of- How am I gonna eat next week? Yeah, in the middle of all that grief.

Like it's just, it is, it's terrible. And so life insurance is the one thing, especially as a mom with three little kids that I'm like so big on for people to get because it's inexpensive. Xander is the place that Winston and I a mom with three little kids, that I'm like so big on for people to get because it's inexpensive. Zander is the place that Winston and I actually get all of our life insurance. And it doesn't cost much because Zander shops among a gazillion different companies. It doesn't cost much. You just have to admit that someday you're not going to be here.

You got to say it out loud and you got to say, I'm going to say I love you to my family by taking care of them and taking the time to put this stuff in place. The cost of stinking pizza. To get a free quote call 800-356-4282 that's 800-356-4282 or go to zander.com Jade Walshaw, Ramsey Personality is my co-host today. Thank you for joining us. Today's Ramsey Show Question of the Day is sponsored by YREi. When

you're trapped in a maze of defaulted private student loan debt, hard to find your way out, but WhyRefi can offer you a lifeline with custom refinancing based on your ability to pay and a lump sum payoff option you could qualify for after 24 months at a discount. Go to YREFI.com slash Ramsey that's the letter YREFY.com slash Ramsey might not be available in all states. Alrighty then today's question comes from Ashley in Illinois she says my husband and I will be debt free in about three years, house and everything. Congratulations. The house we currently live in is the house

that he lived in with his ex-wife. Yee. I would like to get a place that is new to us, that we can create our life together. Is it stupid to get a mortgage when we are debt free? That's a very good question. The simple answer is no, it's not bad. It's not the worst thing.

You could definitely do worse. And the reason that you're wanting to do this, I understand it. I just wonder if you go ahead and you are debt free within this three year timeframe. I wonder what the market will be like and if there's something that you can just simply say, we're moving from one house to another,

you may not have to go into debt. Or if it's a small amount, I'm not mad at it. I just think that you're really gonna love the feeling of being free. And so when that time comes, you're gonna step very lightly. You're probably gonna be very lenient on the amount that you would be willing to borrow. And I think that that's a good thing.

Yeah, it's not, to answer your question, It's not stupid. It's not bad or evil. We just don't like debt. So if you have the ability to do something in cash, I think that that's a great thing. But I definitely wouldn't go crazy on this. What do you think? Here's what's interesting. It is assumed that I have to move up in house to move out of her house. Yeah, they might be able to get something. Move down in house. It's a novel concept. So now we're getting to the root of why we really want to move.

That's good, Dave. Listen, you're not wrong. I saw one with a Jacuzzi and a Skylight. Mine doesn't have that. They might be willing to consider that because she hasn't felt that freedom of no mortgage yet. Well, I was saying that these are not necessarily the same thing. You could move down in house or you could move to the exact same price of house and be out of the ex's house, which I completely would definitely want to do it. I would too, but you're right.

There's probably a part that's like, that would gross me out. I want out of her house and I also want into another nice nicer better house. Well, I mean moving up in house is one question. Moving out of the ex's house is another question. But even moving up in house, there are two different questions. There are two different questions, but even if she just simply said it like that, I personally still would be like, listen, if you told me you were taking on,

at that point it's like, hey, Jade, we're moving up in house, it's gonna cause us to take on $100,000 mortgage. Then my question would be like, well, how quickly could you save to get that done? You have no house payment. So when you put it like that and say. Sell it and go rent for two years. Exactly, when you put it that way, it's like, well,

it's a small mortgage. Then if it's a small mortgage, you could probably pay cash for it just as quickly. So I can tell you, once I got out, I heard a horse is going to drug me back. You ain't going back. I know that's right. And that includes a dissatisfied wife. Nothing, nothing, nothing going to drag me back in. So we might, I get, wanna move, let's just go, we'll go rent.

I get you wanna move, we're gonna move down. We're gonna get us a little condo. Oh yeah. Where the ex hadn't been. I get the move, but you're, this lady is asking the same question we get when we have someone say, hey, I have a $10,000 paid for car, it just got totaled.

I don't really wanna go in debt to buy a new car. Well, you don't have to. You get the $10,000 check from the insurance company and you buy a $10,000 car. But instead you're using the car totaling as an excuse to move up to a $20,000 car and somehow that equates to payments and you're gonna act like the car being totaled caused this.

No, you moved up in cars. That's what caused it. You just wanted to go up in a car, yeah. That's interesting. The ex didn't cause this. It's not, they didn't cause the move up. They caused the move out. That's the other question of this.

I'm like listen, if your plan was to go into debt for a mortgage anyway, then why are you waiting three years till you pay this thing off? What's the point? Yeah, I'm gonna go ahead and move now. What's the point? That's a good idea too. That's a really good, I like that the best thing

We've said Doug is in st. Louis. Hey Doug, what's up? Hi, how's it going? Thanks for taking my call Sherman. How can we help? Hey, so I've got some good news and paid off a lot of debt and But I want to talk to you about the emotional side. The guilt is still there. So Yeah, so we had some major medical bills and some home repairs on ourselves over a hundred thousand dollars in debt. Um, we decided we didn't want to pay the minimums anymore. So we paid off a third, settled a third. And then when my 99 year old grandma passed away, we got a little money.

So that with the exception of our mortgage, my wife's two loans and a very small car payment, which we're going to pay off So that with the exception of our mortgage, my wife's two loans and a very small car payment which we're going to pay off early, we're out of debt. Okay. What is it you feel guilty about? The, just still, even if we budget for it, a big purchase, it still feels uncomfortable or if you're going to the kids activities and you run out of time and you're swing by McDonald's and you're like you feel the occasional purchases it still feels guilty. Are you doing a budget? Yes. Does your budget account for those occasional purchases? Yes. Are you able to accomplish your other goals with the occasional

purchases? Yes. Yes. It just still feels weird. Do you feel bad that you didn't pay? Is it because you didn't use your earned money per se to pay off all the debt? It's more a mixture of I guess I'm afraid to go back and then, you know, I've really drastically increased my income. And so I feel a little like, you know, people who are having a harder time. And then the other part of the guilt is, um, so we have a three year old and a five year old, um, and, um, because of the medical stuff and because of just, it was just easier with my wife being home. Um, we, when she's home, we meal plan better.

We, we save more money because we don't need out. We don't save money to about three year old about to go to daycare. We save more money that way. But anytime you go to the family, friends, anything, it's the first, when she go back and it's like, well, I've increased my income. I think we'll be okay. They don't get a vote. Okay. I know it's in my head and I guess what I'm trying to say is how do I get it? We're doing fine. But how do I get all that voices out of my head? I assume that once you cut off the day, it still takes a little bit

before you feel that release. Listen, I'll be honest with you. My husband and I paid off a big amount of debt and immediately you're like, yes, this debt's gone. But you do feel the residual effects of that throughout like your day to day life. For me, it's I would go to the grocery store and my armpits would still sweat when it was time to swipe my card. Still to this day, I have to stop myself from checking my account to make sure the money's there. So there is that part of it that your body

is just used to a certain response when it gets in those familiar circumstances. And I do think that that starts to fade over time. I think the best thing for me, one of the best anecdotes for this has been, anecdotes for this has been the budget and just going over it and saying, okay, I planned for this and, and reminding myself

that I'm still doing all of the things that caused me to be a financially responsible adult. I'm still doing my investing. I am still, you know, planning for the future. I'm still being generous. Like when I tell myself, Jade, you're checking all the boxes, this is okay. Then it kind of causes my heartbeat to slow down. All the boxes are checked,

including taking my wife out to a $300 dinner tonight. Okay. I'm not talking about, I'm talking about- Oh, I am, I'm talking about that. Maybe. I think this woman needs somebody to take her to dinner, sounds like. And sometimes to Dave's point, to Dave's point, I do think you need to bust

through those barriers a little bit and remind yourself why you did this. Why did I pay off this debt? There's a so that to it. And the so that wasn't so that you could be at home and fretting about every small purchase that wasn't the so that right. Yeah, that's a good point. And as far as the other people getting a vote, I can tell you there's a high correlation between people that

build wealth and those that don't give a crap what other people think right? So you pretty quickly go high, you know, whatever you want to think about that's fine. I mean, I got people that want to tell us what to do, but they've even voted wrong for the president. So, you know, I don't even, why do I want to listen to them? You know, you gotta be careful who you're listening to, man. You don't get a vote. You don't get a vote. This is the Ramsey Show.

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broke the classic questions for humans decks are just $12 all kinds of Christmas specials good stocking stuffers. And hey guys, I mean you can buy an ugly tie or you can buy a book that will change somebody's life. Hello? Yeah. Yeah. So click the link in the description on YouTube or podcast or RamseySolutions.com slash Stoa. Kyle is in Salt Lake City. Hey Kyle, what's up? Hey Dave, I appreciate taking my call. I messed up big. Went behind my wife's back, racked up 26k in credit card debt in four months. Bring the wife I should say, and now she's bound for divorce. What'd you jack up 26k on? Pokemon cards. trying to buy a bunch and then sell them online which didn't work out.

Oh okay. All right. She's filing for divorce. Yes she already filed and sounds like things were pretty rocky before. Yeah it's not because of these Pokemon cards that was just the final straw. Yeah correct we have three boys together two to five and our first girl on the way She's 15 weeks pregnant. So what went on before this? Why what were the straws before this? How have you been behaving? Angry short not not not pleasant at all to be around to be honest I Appreciate your honesty. Yeah. So let me ask you if you were to put her shoes on for a minute, what do you think regarding this

purchase that she's angry about? The deceit, the betrayal. Good betrayal good good That's good self-awareness Yeah in our world we call this financial infidelity Because it's you busted the trust almost as if you slept with someone Yeah, that's the way it feels. It's the same part of the brain That you damaged Yeah, that's what's going on. And so that's why I pushed her over the top. And then so the net net of the thing is,

have you been able to sell the Pokemon cards yet? No, I'm going here on a few, I'm just getting everything together so I can take it to one of the local shops here in Salt Lake to sell and pay back some part of this debt. What do you think they're gonna bring? I'll be lucky honestly if I probably get five grand. So how did you mess this up that bad? I'm confused. So what had happened was I was trying to build a platform on social media so I built an Instagram account

where you buy followers and I paid a lot of money on giveaways on an app called whatnot And that's how I really racked up the debt was buying these expensive giveaways to try to get people to come So you didn't really buy twenty six thousand dollars worth of Pokemon. You really spent some of this money on the website Yes. Yeah trying to build a false front. Yeah. Yes look like you're bigger than you really are 100% did you tell her any part of this and she said don't do it and you did it anyway, or you just kind of did it all Yes, I started at we were at four grand and that's just you know, 4500 and then I went And continued as things were you going to rocky path? I felt I just I'd self indulged in myself yeah, and one all in and on myself out of selfish greed and As things were already going to rocky path, I felt, I just, I self-indulged in myself

and went all in on myself out of selfish greed and lust for fame that wasn't real. Are you in counseling? I am, yeah, she went with me today, went to my appointment. Okay. That's good. Yeah, and that's point blank. I say that because you sound like you're working

through this Mentally at least it sounds like it in this very short call Has she said anything to the effect of here's what I need to see in order to stay with you or has she just said? That's it She did I looked up a video from you guys. That's how I came across your number last night a financial infidelity She used that word and I told her I said look I know I'm gonna be served papers tomorrow next day So if there's even a chance you'll stay with me I would burn all these cards right now work overtime and do whatever it takes

She said no, I want to go through therapist appointment good and The therapist said why should she stay with you? I said, logically she shouldn't. I said, she has no room to stand on that she should. And I said, but there's even a chance, even if in the end it's worth it to give a chance to my family. So let me give you a parallel. And we're not counselors.

Dr. John Deloney is our counselor, but we work with people in these situations and have for 30 years so much that the parallel she's looking for, I'll tell you what, go pick up this book by Dr. Henry Cloud, it's called Trust. Trust. That's what this whole call is about. Broken trust. In his book he talks about how to build trust and how to rebuild trust when trust

has been broken. Also recommend it for your wife because it will give her the correct things if she's willing to demand of you that are the right things to demand of you. And it should sound something like this. The way're trying, the way you rebuild trust is over a period of time you establish a pattern of never repeating the major offense here and you already told me what the major offense here was. It wasn't buying things on the internet, it wasn't Pokemon cards, it was lying. Yeah. That was the major offense and so if she enters back into this if she were my Daughter or my little sister. I would tell her to give you a shot, but you get one

strike Yeah, never again. Do you lie you are so? Unbelievably honest that it's awkward all the time around your house Do these jeans make me look fat? Yes. You have to tell the truth all the time. And you have to be proactive about making sure there's no place for mistrust to live. So you're sharing all the account passwords, you're putting the PIN, you know, you're sharing your location on your phone. I always say make it to where there's no foothold for that to even get in. Yeah. And that way there's

no questions. So let me kind of give you a correlation a little bit in my life. There wasn't a deception, but my wife did lose faith in me when we went broke because I was stupid, which was valid. It took years for her to trust 100% in my judgment. We made all decisions together and still make all decisions together, which gives her comfort that I'm not off chasing the moon somewhere like you were. You went off chasing a get rich quick thing and that I did too and that's how I went broke.

Didn't cost me my marriage, did cost me bankruptcy because I was an idiot. Okay, I did it with more zeros than you did it dude. So she, but it took her, I mean we've been married 43 years, that was 35 years ago we filed bankruptcy. To this day, if I say a phrase a certain way, I'll see her head tilt because it reminds her body, it reminds her emotions of those old days, and then I have to stop and rephrase and go, okay, here's what I was really trying to say.

I can see her body react to this day. Now it's not much, it's very seldom today because it's been a lot of years of a good pattern. Trust has been rebuilt. She trusts my wisdom now. But it's with, you know, I had 30 years to work on that. Absolutely. So you've got to rebuild trust in your integrity.

No strikes, no lying, no purchases that she doesn't know about the rest of your life. Not a freaking pack of gum. The rest of your life period. And it's like if you're an alcoholic and she says I'm done, but I'm gonna give you one more chance, one more time you fall off the wagon, you're gone.

Yeah, yes. You're on a one strike deal. And then you gotta lean into that and it sounds like you're ready to do that. It does sound like that. It does sound like that, but I, you know. Time will tell. She may not be ready. She may not want to do it, but this is how it works, folks. You've got to tell the truth and you got to work together on money. High correlation between that

and winning with money, high correlation and not doing that and losing with money. This is The Ramsey Show. with money. This is the Ramsey Show. Hey you guys, I'm not a fan of the big banks and you probably already know which ones I mean. But I do like credit unions because they're non-profit organizations that focus on their members. And I'm proud to endorse Fairwinds Credit union because they share the Ramsey mission of helping people get out of debt and live generously. In fact they design products to help keep you from going into debt in the first place. Fair WINS has been in business for over 75 years and they serve hundreds of thousands of members worldwide. You can feel secure because your deposits are federally

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they created just for Ramsey fans to help you take control of your finances. That's fair wins. F-A-I-R-W-I-N-D-S dot org slash Ramsey. Live from the headquarters of Ramsey Solutions, it's the Ramsey Show. We help people build wealth, do work that they love and create actual amazing relationships. I'm Dave Ramsey, your host, Jade Walshaw. Ramsey's personality is my co-host today.

She's the number one bestselling author here on the show with me. We're answering your questions at 888-825-5225. Rex is with us in Columbus, hi Rex how are you? Hi Dave I Jade I'm doing well it's pleasure to talk to you two today. You two what's up in your world? So I'm 27 I got married just over a year ago bought a house shortly after we're on track baby steps four five and six to pay off our home in about four years from now. Our first child is on the way, due in five months, and my question is one about priorities. I really want to keep paying down this house ASAP so my wife not have

a job in the future other than caring for the family, but I also want to be generous with others. And a buddy of mine went through a separation recently. He's a hard worker, not a bum, but he's starting from scratch, saving up to buy a car. And I'd like to give him a beater for Christmas as a way to bless him and advance his future, but I worry if this is reckless financially while I still have a mortgage.

What's your pregnant wife say? I just brought this up with her yesterday and she she's mixed about it she's more hesitant than I am but surprisingly she was not averse. What's your household income? Between 225 to 250 K a year. How much do you have in your emergency? At least six months of expenses, about six months. How much? So I want to say it's like 30 to 35.

How much you're spending on the beater? I'm thinking no more than $1,200. Oh, I'd do it. $1,200? That's it? Yeah. That car's gone down a little bit, so I mean, they used to be in pricey or even the beaters. I mean, I'm just telling you if I woke up in your shoes today, I would do that in two seconds. It's a very small part of your world.

It's a good point. But if I may add one more piece, I am considering a career change relatively shortly. Although, again, I'm making 100k and the rest about 125 or so is my white. I worry about my future at this company. I don't feel as though I'm doing a good job as I have in other roles. It doesn't seem like a good fit for me. So you fear that- Can you make 100k if you lost your job? $ 1200 bucks don't help you. That's a good point. Yeah I mean for me that doesn't change it much what you're talking about is how far in the future you know what I'm saying hmm so for me I mean if it really made you feel that weird you could say

well I'm gonna I'm gonna spend $1,200 on this and then I'm gonna add an extra $1,200 to my, like you could balance it in a weird way to make your brain feel better. And I think when you do that, you'll realize, oh, this wasn't that big of a, it wasn't that big of a deal. What's interesting is, is that this tiny little bit of stress really shined a big light on your career thing

and means you need to get off your butt and do something about that. That's a good point. Right. You need to act on it instead of wait and let something happen to you. Yeah are you concerned that when you have this baby your wife's not gonna want to go back to work after leave? I don't think that's the case. She's working from home now so it's relatively manageable. Okay. But I do still want to have, I won't give her the opportunity to not feel trapped in her job. Yeah, I hear that. $1,200 does not keep her from coming home. You losing your job might. Right. So these are way different decisions. One's $100k, one's

1.2% of a hundred K. But kudos to you for thinking in the way of generosity like that. I love things like that. It's the reason that you go through and do the baby steps so that you can do those sorts of things. So really good. And you know and also what's weird is this ten years from now you'll forget you did it. Yeah. It's such a small, yeah it's such a small piece. He'll remember it the rest of his life, but you won't. I promise you. I don't remember what I have done. Yeah. I don't. Good. I have no idea. Bailey is in Fort Worth, Texas. Hi Bailey, welcome to the Ramsey Show. Hi there, thank you for

taking my call. Sure, what's up? Hi there. So my husband and I, we have recently been binging your guys' show and we are preparing now with our baby step one and are about to start our baby step two. Looking at our debt, we've made some real dumb decisions and my husband's credit cards, there are several, we have let all go into default over the last couple of years mine however our current I have three and so when listing them since we know we've we've gone out gotten all the information about paying them in full you know settlement in full with the prepaid debit card all that sort of stuff but I just don't know how to go about listing them smallest to largest since they will be a some you know lump sum I

would do two separate you mine first I would do two stick two debt snowballs one for current debt and work it first and then work the old bad debt second okay and then our car loan is actually now a personal loan from a friend. Should that be? Gross. Yeah. That might. First. I'd want to attack that very quickly. That's on your list. That's on your list of current debts, right? Right. It is just one of the larger ones.

Because my credit cards are all relatively small. However, because it's a debt with a friend, it really is hanging over my head. So should it still be black? How long have you had it? How long have you had the debt with the friend? One year. We've been paying and we're current, you know, we're paying them all monthly. And how long will it take you to pay off the first few things in your snowball, those few

credit cards? My first three are only 10,000. So probably about five months. What's your household income? Currently it's at a hundred but in the next six months we're gonna go up to 160. Good. It's not gonna take you that long then. Yeah I probably better get more than two grand a month rolling out of 160 kiddo. Yeah it's just not gonna go up until February so we are impatiently waiting. Okay well and you need to go ahead and cut your cut

your eating out off the budget too um have you been paying or you haven't been paying the friend we have been yeah okay what do you owe on the car 10,000 oh we'll knock it out yeah it'll be gone by summer if it makes you feel better just tell them hey we're doing this debt snowball and we list them smallest to largest you're number four and we're happy our plan is to pay you off this year and so that we're not running this thing out. You should be done you should be done with them by April or May. Yeah. Okay that is our hope and then just go ahead. No it's not a hope it's a math thing. Yeah. Hey run the math out. Have you done the math on

this to see what your projected date is? Cause if you haven't, you need to jump in every dollar. You need to do your roadmap so that you know. We have downloaded every dollar and we are using that. Okay. Then that is the accountability there. And just from somebody who's been in your shoes, you need to speak that way.

Because if you run everything, if you verbalize everything as if it's a it might happen, it might not, then chances are it might not happen. So you need to verbalize it in the way of well we'll be done with that in April and then when we're done with this one in January. Do you see what I'm saying? You need to use that and let that be your vocabulary because that's going to inform what you actually do to accomplish this goal. Yeah how fast do we go through 20 grand? 10 in credit cards, 10 in car, making 100 bleeding into 160. Pretty stinkin' fast.

Pretty stinkin' fast. This is The Ramsey Show. This show is sponsored by Better Health. All right, hey, it's that time of year when it's getting a little colder, it's getting dark earlier, and sometimes we just wanna stay inside and get cozy. For me, the perfect night at home

when I'm trying to be cozy is me and my whole family under a bunch of big blankets watching a TV show or reading a book. Whatever your perfect night in looks like, therapy can feel a bit like that. A time when you can settle in, get cozy, replenish your energy, and take care of yourself. Therapy is a great way to bring yourself some comfort, especially during the chaos and rush of the holiday season or any other time of year. Taking the time to

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This is your chance to invest in your marriage, strengthen your communication, and get away from all the noise and chaos of everyday life together with your spouse. You're worth an incredible marriage, and trust me, it's way better than the chocolates and flowers you had planned. Tickets start at $799 per couple. Go to ramsysolutions.com slash getaway to get your tickets. Jade Washoff, Ramsey personality is my co-host today. Open phones at 888-825-5225. The old motivator from another generation before there was a Zig Ziglar, before there

was a Tony Robbins, before there was a Dave Ramsey, Earl Nightingale said, what you can conceive and believe you can achieve. Jade, with that last call, you said the same thing to her. You need to be so dialed in on your numbers that you are speaking the future March of 2025 as if it is fact. That's right. Because the math is telling you that it is a fact and you don't use language like I hope. Maybe. Maybe. Hopefully.

Sorta, kinda. Tells me you haven't dialed in your numbers exactly. You need to get a little bit nerdy with your numbers. And because here's what really happens out there in the real world. In the real world is almost always you will get out of debt faster than your first plan you lay out thinks you're going to. 100% that is so true. You know I remember because some people know that some people don't but I used to listen to the show long before I ever

got to work on the show. And I remember you used to say, Dave, when you start working the plan, intensely you get on a moving sidewalk. It's like at the airport when you go and you can either walk normal or get on that little sidewalk and it makes you walk a little bit faster.

That is so, so true. I think you just open yourself up to opportunities when you say, I'm gonna go lightning fast, I'm willing to do whatever work it takes, then you begin to see the opportunities around you to go faster. Yeah I think God just looks down and goes oh yeah there's a smart one I think I'll help this one. Wants to do it my way yeah. Yeah they want to get out of debt I think I'll just lift them right along here fly little bird. Yeah that's right. You just you look up me well that's supposed to take nine months and it took seven.

That's right. But what I was saying to you on the break, and this really does segue into every dollar, is most people have never said, I am going to do insert specific task, and I'm going to do it in this timeframe, insert specific timeframe, and this is going to be the exact outcome.

And once you do that for the first time time and a lot of people for the first Time they do that. It's when they do their every dollar budget and when they pay off their debt Once you do that it creates a confidence on the inside of you that oh, I can actually say something Do it and hold myself accountable. That is it breaks open a whole new world of Possibility and confidence in yourself. So that alone. You know, like we're approaching the first of the year and we're going to do the goal setting talk. Yeah.

And we always do that. And it's something I've taught entree leaders for 25 years. And I learned it when I was 12 years old, going to these motivational seminars, my dad and the real estate business. But I want to lose weight is not a goal. No. I want to lose 30 pounds, okay, over 10 years and how many times? Do you want to lose 30 pounds? Hopefully just once. Well, hello. So okay, so these are still not a goal. It's a wish. It has to be specific, it has to be measurable, it has to have a time frame.

As soon as it has all three of those things, then you will do the long division math immediately that you learned somewhere around the fourth or fifth grade, hopefully. And that is, I wanna lose 30 pounds, when? Oh, 90 days, oh, you mean 10 pounds a month, oh, you mean two and a half pounds a week, oh, I'm gonna increase my aerobic activity,

my water intake, and decrease my bread and sugar intake, and I will lose two and a half pounds a month. Oh, you mean two and a half pounds a week. Oh, I'm gonna increase my aerobic activity, my water intake, and decrease my bread and sugar intake and I will lose two and a half pounds a week. It's magical. You don't even need Oprah. I mean that's how it works. That is how it works. Because you dialed it in but it's specific, it's measurable, you spoke it because it's in a certain timeframe and then you know if you're not on track or not. that's why that's why doing your every dollar budget works. That's right because you can look at and go am I am I accomplishing what I said I was accomplishing and so yeah let's get into it. This is how it works ladies and gentlemen. So check it out you can download every dollar for free in the app store or google play. Do not miss this. People who win at anything are

doing that intentionally. Winning is a series of intentional acts. David's in Fort Smith, Arkansas. Hi David, welcome to the Ramsey Show. Hey, what's up? Oh, I got a problem. My insurance company is wanting to, they say it's illegal for them to insure my automobiles because I have such a low credit score. I've been very wise with my money. I have no bills. I don't borrow a lot of money.

I don't need money. Who's your insurance company? And now you're saying, huh? Who's your insurance company? Shelter Insurance. Shelter, okay. Yes. Okay, the agent that you're talking with is either an ignoramus or a liar or both.

They sent me a letter. They sent me a letter. Oh, okay, they're lying. It is not illegal to issue insurance to someone with a low credit score. It might be unprofitable for them and here's where this comes from. The University of Florida in conjunction with the University of Pennsylvania 25 years ago did a study that shows that people with low to no credit scores file more claims more often and so the insurance

business across the board took the FICO score and used it to raise rates. But it has nothing to do with legal so my credit score my credit score is zero and has a David my credit score zero and has been for 30 years do you think I have trouble getting insurance no but I have old automobile I have a 2007 or 2014 I have nothing new I have a 2011 Harley and a 2000 I have nothing old everything's got a lot built-in insurance on you see what I'm saying I have nothing with full coverage insurance don't need full coverage you have debt no I'm debt free you have a zero credit score I have a zero credit score. I have a zero credit score. Okay

Well, then what you need to do is fire your stupid insurance company because they're stupid and get you another one So go to RamseySolutions.com and click on ELP for endorsed local provider And you can find the insurance for home and auto It's called P&C property and and Casualty Insurance, and those agents don't work for a single company, they work for you. They will shop among many companies and get you the best deal, and you can decide how to do that. But it is not illegal to issue insurance on someone that has a zero credit score. They are following a false premise because the research that I just referenced that's 20 years old or 25

years old was incomplete research in that it is valid in the sense that if you have bad credit because you don't pay your bills you are more likely to file a claim and a higher claim. That does make sense because you're broke. Now, but if you have a zero credit score you are more likely to file a claim and a higher claim. That does make sense, because you're broke. Now, but if you have a zero credit score, I'm not more likely to file a claim,

I'm a multi-millionaire, that's dumb. I'm less likely to file a claim, that's dumb, all right? So obviously the research is incomplete for a guy like David or a guy like me. David's got plenty of money, he just drives beaters because he wants to, that's what he said. That reminds me of that same way of thinking with rental cars. I feel like it's the same thing. You know I just came I was leaving where was I leaving Denver and I wanted to

rent the car and then drop it at another airport. Oh no you are. And they said you cannot do that if you don't have a credit card and I said what's that got to do with it? Because of the theft. Yeah. There's entire gangs that are running debit card theft all that they're stealing these credit the size of the rental car business is unbelievable and the size of theft that they deal with is unbelievable. That's what the guy was telling me. That's exactly what does it so we learned that when we had Dollar Rent-a-Card as a sponsor here for a while. We talked them into being the world's best debit card only or they took the debit card for Ramsey listeners.

And we did that for a while. And then of course with COVID, everybody went bankrupt including Hertz that owned them. And so then they come back as Dollar, Dollar came back as $2 Rent-a-Card and they got a new CEO and a new leadership team and decided they weren't going to take debit cards anymore, which means we had to take them off there because we can't endorse them anymore. So

we lost a sponsor and they lost a bunch of customers because that was stupid. But anyway, we learned all this. They showed us the data back in the day, why it was so risky because it's there literally, and I'm not making this up gangs that steal cars from minicar companies on debit cards and they use a debit card to do it and so and the worst one the worst location in the world is Las Vegas by the way yeah but yeah for some reason if you pick it up and drop it off at the same location you can use it's fine well that's because they think they're gonna get the car back at least yeah the idea that you're leaving California and never coming back you can use, it's fine. Well, that's because they think they're gonna get the car back at least. That's right. Yeah. Ha ha.

So crazy. The idea that you're leaving California and never coming back is scary to them. Ha ha ha. This is The Ramsey Show. Remember the good old days of the internet before it was a privacy nightmare filled with spammers, scammers, hackers and fraudsters? Simpler times. Now, I don't have a time machine, but I do have the next best thing, Delete Me.

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week and one grand prize of $5,000. Enter daily for your chance to win at RamseySolutions.com slash giveaway. It's that easy. Plus our 50 days of Christmas deals is on right now. Get up to 30% off best sellers and life changing gifts that won't break the holiday budget. RamseySolutions.com slash store. Jade Wachow, Ramsey personality is my co-host today in the lobby of Ramsey Solutions. Casey and

Jesse are on the debt-free stage. Hey guys what's up? Hey guys how are you? Welcome where do y'all live? Ruston Louisiana. Oh fun welcome to Nashville. How much debt have you two paid off? We have paid off $205,960.46. I love it! How long did this take? 23 months. Whoa, you're cooking. And what kind of income range during that two years? 110 to 140.

Wow, nice. What do y'all do for a living? I'm an equipment manager for a golf course. Okay. And I'm a payroll administrator. And what did you sell? An old home. These numbers don't work. Exactly.

We sold some land and a rent house nightmare. Oh. And a lot of other things. We sold so many things the kids thought they were next. I love that. So what did the rent house nightmare bring? It brought $122,000. Good.

And what did the land bring? About $25,000. Okay. Okay, cool. And what kind and what'd the land bring? About $25,000. Okay, cool. And what kind of debt was the 206? Maxed out, home line of credit, on the nightmare rent house.

Camper, car, credit cards, phone loans, and medical bills. Y'all were normal. Everything but student loans. You were normal, you had it all. Yeah. Yeah, it sucks. We had to have it all. It really did. It was horrible. How old are you two? I am 36. 38. And how long have you been married? 17 years. Okay, so two years ago, three years ago, you had a I'm sick of this, sick and tired of being sick and tired moment. I've had it. What happened, tell us the story.

So I actually listened to your book a few years before our journey. We were already drowning in debt and I listened to the total money makeover. It was like, he is so right, we have got to get out of this debt, we'd have so much margin in our life. But I don't wanna listen to your plan, I wanna do my plan.

So we raised- You're the first person to ever do that. We raised the limit on the maxed out home line of credit and maxed it out again. There you go. And then found ourselves in even more debt. This was the third time we consolidated our debt. Each time we doubled the debt.

And didn't change habits, go back in deep. No, no, no, no, no, no. So two years ago we're drowning again. The renters hadn't paid rent in six months and we had a variable interest rate on the rent house. So the feds were going up, so we went from $300 interest payment to $900 interest payments.

Yeah, it was bad. We couldn't do it. We literally couldn't pay. So then I listened to your book again, and this time it sank in. It's okay, my plan obviously isn't working. I had prayed numerous times, God, please increase our income

so that we can get out of this, and said no I'm cutting you off you obviously are bad stewards of my money you've got to learn this lesson. So then I said let's do this and at the time our marriage honestly was on the rocks Casey was dealing with some heavy depression and I was like I'm not sure how I'm gonna get my spouse on board because he wanted nothing to do with the finances. I was I'd given up I was done. Well did the the weight of this add to the issue with depression correct? It was it was a it was a big portion of it Okay, a lot of it so I did the only logical thing which is say hey

I'm going to sell this gift that you bought me on credit a few years ago Why don't you ride with me to make sure that I'm safe as I sell this item? Uh-huh, and I trapped him in the car listening to total money make It didn't go well. He made fun of the book. It can't be that easy. It's just seven easy baby steps. A baby could do it.

It's so easy. I was not a believer at first. You're not listening. He says it's not easy. I like it. I like you. So I'm like, okay, I'm on my own. Give it a few days.

So when he comes home and... I'd listen to a few of the debt-free screams. I started listening to the podcast and heard a few of them and it was very inspiring, very emotional for me. And I said, you know what, if these folks can do it, who some are worse off, some are not as much, but they were able to do it. I thought, why can't I?

Made it real. Yeah, it did, it finally did. I thought I saw it was been decided. And now you're here doing that for somebody else. That's it, that's it. Let me ask you a question, because I'm researching this exact thing. There was something that,

when you first heard the baby steps, you had an emotion that caused you to say, I'm not gonna do it exactly like they teach, I'm gonna do it my way. Casey, you had an emotion that caused you to say, this guy, this is not a baby step, this is, you know, for adults, whatever you thought. What was that emotion that caused you to initially

kind of back away from it? Was it fear, was it, I just wanna be complacent? It seemed insurmountable, like this is impossible. I thought I was gonna live to my death, working and in debt. I grew up knowing it, I was in the mindset of can we afford it? That's the culture I grew up in,

is not can we afford it, can we afford the payments? That's the culture I grew up in is not can we afford it, can we afford the payments? That's the word. That's how I grew up. I'm like this is this can't be done. And what about you, Jessie? What was it that caused you to say I'm going to do it my way? This sounds good, but I'm still going to do it my way. Well, I don't want to take the time to have to go through all of this if I can just wipe it clean and have a $400 payment in one thing versus working and taking years. I mean when we initially looked at the snowball calculator, we were at 2031 paying off all this debt.

And we did it in 23 months. That's right. It was just. But the snowball calculator did not include selling off everything. Right. Correct. It did not at first. It did not.

When you plugged that in, it changed the numbers. It did. It did. And we had, I mean, life happened. All the plumbing busted when we had a freeze in that rent house. Oh my God, this house is cursed. It was. The renters had destroyed it. I mean, flooring was gone. There was a lot of fecal matter everywhere. Oh great. Animals, animals. But we did have a real estate pro, Ramsey pro, and he helped us through the whole thing. Yeah. I mean, I would work at night, get off work, go to the house and clean.

And then Casey worked a ton of overtime. We door dashed. You gave plasma. Yeah, sure did. Wow. But once you start going, and I used some debt-free chart trackers as well, it just kept us motivated of knocking this out and getting ahead. How's it feel to be free? Amazing. Amazing.

It's so nice. I wish everyone could feel this way. It's awesome. Our daughter made homecoming court and we're like, we have to go buy two dresses now and we could just afford it. This was in the past month. We had margin, yeah.

In the past month, yeah. It's been so fantastic. We get to buy. Yeah. Exactly, yeah. That's so fantastic we get to buy yeah exactly yeah yeah yeah that's very cool and then the Facebook group the baby steps community that y'all have really helped as well just looking through and seeing other people's stories which JG became a personality about a few months as we started in your story really helped motivate me a lot, you and Sam.

I was like, okay, they have way more depth and idea. I don't feel nearly as bad. Let's do this. Oh, I'm so glad. So what would you say to that person who's listening and they're where you were, Casey, they're going, this is not as easy as you think it is. Jesse, they're saying, I'll do it, but I'll do it my way.

What would you say to that person? You can do it. It's not impossible. Just start. Yeah. Budget and start because if you just look at it has a hole. It is. It's overwhelming. You're like we're never gonna get out but if you just start and really follow the steps and start with baby step one and then start with baby step two and pay off that little debt, each credit card down was just so exciting to us. Now we have more money to throw at that debt. That's right.

I mean we started at only being able to put an extra $200 a month towards this debt. By the end we were throwing over $3,000 a month at it. Yeah. Ding, ding, ding, ding. Yeah. Yeah and 23 months out of your 17 years was hell., wait a minute a lot of the other was hell, too But this hell got you out. That's it. Yeah, you paid a price to win way to go. I'm proud of you

All right, bring the kiddos up. Let's get their names and ages looks like they survived the cutbacks They sure did. We got Emily here. She's 15 way to go home coming coming just turned 13. I love it. I love it I love it. Well, this is excellent you guys proud of you all. Thank you. Well done. Who was cheering you on? friends and family Co-workers. Yeah, yeah co-workers. Yeah, sure everybody was pretty much cheering us all and especially when they heard how much we heard Yeah, I love that you're dead free. My favorite part of your story is that cloud of depression has lifted off your house That makes me cry. That's a power Marriage is way better. We're

The transformation of the past two years is unbelievable. I mean I had given up on our marriage practically But after counseling and this I mean we're stronger than we've ever been. Y'all are amazing. Well done. All right, count it down Let's hear a debt-free scream three two one I mean, we're stronger than we've ever been. Y'all are amazing. Well done. All right, count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Yeah! Woo!

Woo! Woo! Yeah! $206,000 paid off in 23 months. Oh, but everything in the house has transformed. Hello. Depression, marriage, everything's transformed. See, the debts all tied into this.

It's not a standalone subject that you can compartmentalize. It's woven its way into your life. It's time for you listening to get it out. They were here to tell you that. I hope you heard it. This is The Ramsey Show. Hey, if you're like me, this time of year feels bananas. Ramsey Show. If you want to lighten your mental load this year, do yourself a favor and go download EveryDollar. It's my favorite budgeting app and it can help you create a game plan for your spending

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all that out. Ryan is with us in Hartford, Connecticut. Hey Ryan welcome to the Ramsey Show. Hey how are you guys? Sure, what's up? Hey, so I have a bit of a problem. I never thought this was going to happen. So in 2018 my father passed away and he left me and my brother a 401k plan, uh, fast forward five years. Uh, I got a check in the mail this morning, uh, for about 245,000. The original account balance was about 300,000 and what's happening is they gave me the check and I have to pay the IRS that 55,000 difference from the 300,000 and 245. I called them and asked them

if they could roll it over and they said once they issued the check there's nothing that can be done. Who told them to issue the check? Not me. Apparently the company my father worked for had a contract that I didn't even read over. I'm sorry, I didn't hear you. hear you you cut out apparently the company your father works Sorry what? Yeah, they um

They have a five-year plan I guess for the best benefit that if it's not rolled over to something else within five years They must close the account and just issue a check out It's super confusing the way they explained it to me I was on the phone with them for an hour and a half this morning with my 401k company. And they pretty much said, once we issue the check, there's nothing that can be done.

There was no work around. Yeah, there is. They had until this, that's what I'm saying. Yeah, there is. I'm sure you don't have an extra 55 grand laying around. No. So the way it worked is my account balance is 300,000.

It started like two 15 and over the years I added up to 300. They issued me a check for two 45. They already took the money now and sent it to the IRS and issued me the difference. Yeah, they have to withhold 20%. That's the rule. If you, if you take a ride, but this is an involuntary withdrawal without no, without any contact to you or anything, which is completely at a minimum Unprofessional what caused you to wait what caused you to wait the five years as opposed to rolling it over?

Because the 401k plan my father was invested in had really good options like I built up all of those same options exist in the open market Yeah, and I have my own personal investment accounts and I do it with that as well. You know, don't rock the boat if the boat shouldn't be rocked. So the way I figured is the 401k plan was perfectly fine. I kept it in there just because the investment options were fine. It was just a retirement account. I was treating it like a retirement account. I wasn't going to touch it until I was 65. I'm 30 now. Yeah. What do you like? I make, I'm a truck driver, so I make about 110,000 a year and I also own a small business that I make about the same.

Okay. Under the Secure Act that Biden passed, you have 10 years to liquidate the 401k completely. The Secure Act that Biden passed, you have 10 years to liquidate the 401k completely. You should have been liquidating it at one-tenth a year from the time the Secure Act passed two years ago, and you've not been doing that. So I'm trying to figure out how that plays into this and how hardcore all right let's pretend that we figure out a way to lean on them and they cancel the check and put the money back in the 401k so that you can roll it over within 30 days which is what they should do if they're are people of integrity this is a problem it's not technically unethical It's just so nasty that it ought to be unethical

Uh what they're doing. It's a big it's a cost. It's a lot of money It's going to cost you it's going to cost you. Um, you know 20 30 000 bucks and that you don't have it cost me two years It cost me two whole years of of gains because of this no way I never thought I would be upset to get a huge check in the mail, but I did and I'm upset because I should have had it rolled over. It should have been huger.

He should have called me. Yeah. All right, so here's what I'm gonna suggest you do, and I don't think it'll work, but it's the only thing I can think of, all right? Okay. Go to ramsysolutions.com and click on SmartVestor and find a SmartVestor Pro in your area

that you like after talking to them on the phone. They may be able to call on your behalf and talk them into undoing this and immediately rolling it and they'll help you with the rollover. undoing this and immediately rolling it and they'll help you with the rollover. Okay. They may be able to cite something that a regulation or something that I'm not aware of because this is when you started talking I thought you were going to tell me this was a tiny little 401k like a $10,000 and they were just cleaning out all the little ones. sometimes they do that when a company

sells or in the event of an inherited 401k like you've got but this is huge this is a lot of money and so this is and with no notification at all this is particularly nasty and so if they had simply notified you you could have quickly rolled it over and avoided this right and they said they notified me but I wait a minute like you're a truck you didn't want they didn't notify you my account they said they did but I never got enough again so you never seen evidence of them. Yeah.

Ask them to prove that they asked them to prove that they did. Okay. Okay. So I mean, I don't, I don't think you've got a basis for suing them, but I'd be tempted to. I really would. I mean, cause you're talking about 25 or $30,000 cost here. That is unnecessary. $55,000.

They took out. They,000 cost here that is unnecessary. $55,000 they took out. No, it's the taxes on $55,000. The $55,000 is going to be taxed, not penalized. No, when I got my experiment, like the summary of what my original account balance was $300,000, they cut me a check for 245. I understand they took 55,000 they sent it to the federal government as tax withholding and it's not all taxable so because the entire because you're gonna roll the rest of this if you take the check in your hand and you roll it to a 401k the only harm that's going to come to you is the taxes on the 55,000 which

is going to be 15 grand or 20 grand oh Oh so I'm gonna have to pay another fifteen grand. Honey you haven't paid anything yet. Okay they withheld your money fifty five thousand and sent it to the federal government. Then what you do is you file a tax return of what is actually due and what will be actually due is not 55,000. It'll only be the taxes on 55,000 if you take the check in your hand and put it into an IRA traditional within 60 days of rent right now. So you need to get on the phone with a SmartVestor Pro right now because at least we need to do that. Okay, I will. But so the worst case scenario if you follow through on what I just told you is taxes on $55,000 because

the government has $55,000 of your money as if you're gonna get taxed on the whole thing and you're not. Okay. Because you're gonna roll the portion in your hand which is 80% of it into a traditional to keep you from getting taxed. You got 60 days to do that from the time withdrawal. So folks you can pull your money out 401k they have to withhold 20% but you have to put a hundred percent into an account within 60 days to avoid taxation. That's what the problem is. But he can't do that because they got 55 of his money over at the IRS now and so if you just take the take the 55 then you're gonna pay some taxes but not 55 so there we

go this is the Ramsey show What's up, what's up? It's Dr. John Delaney from The Dr. John Delaney Show with some amazing news. The latest episode of United States of Anxiety is available right now exclusively on the Ramsey Network app. This docuseries follows real people from my show as they embark on a 90-day journey to transform their lives and I personally walk alongside them every step of the way. Okay, now here's a sneak peek of what the new episode is all about. And don't forget to click the link in the show notes to download the app.

What's up, Kelsey? So I've lived with crippling anxiety for as long as I can remember. How do I stop it from constantly coming up in different areas of my life? What does crippling anxiety mean? Paint me a picture of that. All right, so you ready to jump in? I'm ready to jump in. So we're gonna check in with Kelsey, 30 days, 60 days, 90 days. I cannot even function because I'm just crying.

My mom left us when I was four. I truly felt like for a while I had no family. She's experiencing things that really hurt a long time ago. Tell me about this boy. He triggers me a lot. Scared of losing Paul, scared of doing the wrong thing, scared of not being enough. It just feels like it would be exhausting to be Kelsey. It is.

Whenever somebody's playing whack-a-mole with their anxiety, when it just keeps moving, that tells me the underlying system's not okay. How do I get my inner child out of this relationship? Because I feel like she's running the show. One of two people that's supposed to never leave took off. How is this... How is this burdened? You burdened, that's right.

To the one person who should carry it, all of it. Did you ever tell that little girl that it wasn't her fault? I don't know what to do. You either have to choose to let this guy love you or you gotta choose to let this guy go.