The Ramsey Show - Debt Is Not a Path to Wealth or Peace

Episode Date: September 3, 2024

📱Watch the full episode for free in the Ramsey Network app. Ken Coleman & George Kamel answer your questions and discuss: "I am over $500K in debt" You have to take ownership of your mistakes, "Should I buy a house with my boyfriend? Buying a car for a side hustle, Using money from investments to pay off parent plus loans Support Our Sponsors: Zander Insurance: Go to zander.com or call 800-356-4282 for a fast and easy quote today. BetterHelp: betterhelp.com/Delony to get 10% off your first month   FAIRWINDS Credit Union: Check out the exclusive account bundle designed for Ramsey fans MamaBear Legal Forms: mamabearlegalforms.com and use promo code RAMSEY to save 20% Next Steps 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 🏆 Set and actually reach your goals with the NEW 2025 Ramsey Goal Planner! Hurry—They sell out every year! 🚢 The Live Like No One Else Cruise is booking fast!  💵 Start your free budget today. Download the EveryDollar app! 🛒 Shop the online store at Ramsey Solutions 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

Welcome to the Ramsey Show, where we help you win in your life. We're going to specifically help you win with your money, win in your professional journey, and win with your relationships. Phone number for you to jump in so we can coach you up is 888-825-5225. That's 888-825-5225. I'm Ken Coleman, joined by the incomparable George Camel. He's layered up. He's got his shacket unbuttoned, so he's a little looser today. And so that tells me you're ready to go.

I really thought you were going to say the incompetent George Campbell. Now, why would I do that? You are very competent. It's what Ken wanted to say in his head. Not true. But he said the kind thing instead. That's not true. Everybody knows how much we love each other.

We enjoy being on the air together. We have a good time. We were just having a fun conversation before the show today, which, you know, we can't share. That's true. That was a very fun conversation. You won't be privy to that. You will not be privy to that. Let's go to Richie who starts us off this hour.

Richie's in Raleigh, North Carolina. Richie, how can we help? Hey, hi. Pleased to talk to you guys. I have over half a million dollars debt. Most of it, I would say 90% of it is actually my home. I was in a very lucrative job for almost seven to eight years. But after listening to your podcast, I came to a conclusion that I haven't saved enough,

but I saved enough to put a deposit in a house. And I've been jobless for about eight months now. And I've basically exhausted all of my savings. In fact, this month, I will be taking out the $1,000 that I had kept for my emergency fund towards the mortgage. Apart from that, I have a car that I have to pay around 500, more than $500 every month. And I'm at a point where I've already started borrowing money from my friends and relatives. And so I've kind of, I'm in a big, deep trouble and I don't know if I should sell my house, which I know in a few years from now will give me a lot of equity because this is a growing area. It's in the suburbs of Raleigh. Yeah, Richie, let me jump in for just a second, and George will walk you through

the debt situation. What was the income, and what were you doing before you lost the job? So I am on the business side of software engineering. I am a product manager, and my salary fluctuated between $110,000 to $130,000 a year. Okay, so product manager and on the technology side of things, and you've been without work for eight months. What's happening there? on the technology side of things, and you've been without work for eight months. What's happening there? Because I think you've got an income issue is the primary issue.

So I just want to dig here. What in your mind is the reason why you've been jobless for eight months? I believe it's the job market right now. I know a lot of organizations are laying off people black and blue. I know many people who have graduated and still haven't been able to secure a job, and they've been jobless for more than a year now. So have you had opportunities? Have you had any interviews? That's what I'm looking for.

What's your activity level? I have been applying to at least 50 companies a day on an average. How are you going about that? Basically, in our job scenario, we basically tap people on LinkedIn and other job sites. Richie, I do not want to beat up on you when you're down because this is, we know from psychology that when you lose a job, it has the same emotional impact as losing a loved one. So I want to be sensitive to this, but I can tell you, I've coached so many people who say they apply for things 50 a day. And when I find out it's LinkedIn, you are essentially playing the lottery right now. That is not going to work. And you can tell it hasn't worked. I will tell you that you are going to, and let me just also say this, the job market is very tight

in what we call white collar jobs. And you're in a white collar job and the market is tightening. There's no question about that. But you have got to go about it a very different way. And I want to give you to George here. But at the same time, if we don't have any income coming in, you're not going to be able to do what George teaches you. So you've got to do two things. And I'm going to give you at the end of this call, I'm going to give you my book, The Proximity Principle. And it's an easy read, and I really think you've got to change up your strategies because you have got to be connecting relationship to relationship to relationship just to get an interview.

Then you've got to perform well. I think you understand that. I think you also have to open up the rest of the country. Are you open to moving, or do you feel like you've got to stay in the Raleigh area? No, I'm open to moving for sure. Yeah, I mean, we're in a desperate situation right now, and to that end, I want to get super tactical here. You need to be working at a Walmart stocking shelves.

You need to be driving. You need to be doing whatever it takes, and I'm going to pass it off to George with that as the segue just to cover the basics right now. So you've got to change your strategy and get really intense about finding a gig. But in the meantime, you're working every job you can get. George, I hand it to you here to walk through his numbers. So Richie, you're telling me you don't have any income coming in. You've been draining the emergency fund to live, correct?

Yes. You will for the first time. What is your monthly expenses when you look at your four walls, food, utility, shelter, transportation? What does that add up to? It's over $5,000 because I have my mortgage. It's self-affixed. Mortgage is $3,600. And it's just you?

Are you single? Yes, I'm single. Okay. Here's the deal. It might be where you need to move. You need to rent for a while. One of the reasons is this income situation. The other is you may not need a huge house right now in Raleigh.

And so it's going to free you up with more options as you move into this next career phase. The other is you might need to sell this car. How much is the car worth and what do you owe on it? So the car, I got a pre-owned car for around $50,000. I paid an upfront $20,000 there. So my current monthly payment is $25,000. What's left on the loan? It's about $19,000. And what do you think it's worth if you looked up the Kelly Blue Book private sale value? It could go for $19,000 or $20,000, not more than that. Okay. If I'm in your shoes, I'm getting rid of this car tomorrow. I'm going to borrow a car for a little

bit, save up another $1,000 or $2,000, and just get you a used beater car to get you around for now. Because that car is about to get repoed you can't make the payment on it you're going to be paying that payment with your more debt to cover it yeah so i think this house does need to go on the market for other reasons i think the car needs to go today and that will at least give you a little bit of breathing room but like ken said you need to go get three or four jobs just to cover the bills, to cover those three, four, five grand until you can get that career. That's right. Right. And you got to stop this LinkedIn. And I love LinkedIn. I'm very active on LinkedIn, but LinkedIn is great for information. You've got to make some real human to human connections right now. Your resume is, you are spitting in the wind every day

right now. That is how effective that is. And you've got to get really intentional, Richie. Listen, you have too much skill and too much experience to stay unemployed eight months. I mean, a product manager, that is a very impressive set of skills and also experiences that are very transferable to a lot of industries. But nobody knows you're out there, man. Folks, I'm going to say this. If I've said it once, I've said it a thousand times.

Submitting resumes online, you are just nameless, faceless. You're not making any progress at all. At all. You got to get back out and meet people. Say, will you connect me? Will you take my resume into the hiring manager get back out and meet people. Say, will you connect me? Will you take my resume into the hiring manager? This is all about people. The opportunity follows the connections to people. This is the Ramsey Show. These days, it's not if your identity gets stolen, it's when. And the only

ID theft protection plan I have ever recommended is from Zander Insurance. It helps real people with real life situations. Like the call we got on the show recently where a woman's abusive ex opened a credit card in her name and racked up over $8,000 in debt. Then the bank sued her even though the charges weren't hers. What a mess. With Zander's help, she was able to get the entire nightmare cleared up and now her family is officially debt-free. Listen, Zander's Identity Theft Protection is the best option out there. They have all the cyber tools and monitoring services you need. They cover all types of ID theft, and they even include up to $2 million in stolen funds protection. In the end, though, you need an ally, someone on your side to take over the work and fix the problem.

That's what Zander is all about. Go to Zander.com to learn more or call 800-356-4282. Welcome back to the Ramsey Show, where we help you win in your life. I'm Ken Coleman. George Camel is with me today. It's the firm of Coleman, Camel, and Camel. Don't hire those people. No.

If that was a law firm, I'd say run. Yeah, do your research on that. Do you see us on a park bench with our faces plastered on there? That'd be kind of funny. Been in an injury? Coleman and Camel. You know what? We would use that photo that has yet to sit.

We've got to share that photo today. Do we have the stepbrother's photo that we could share on YouTube? That's a tease. that's a tease we recently got together all the the uh ramsey personalities and we did new shoot a new photo shoot and it turns out that george and i individual photos were back-to-back schedule wise and we had a we had a little fun with that we decided to jump in we reshot the cover to the movie uh step Brothers. I could see that on the park bench. But I'll tell you where you could see us together outside of the show. You know where we can see us? Ramsey Cruise. On the Ramsey Cruise. It's called the Live Like No One Else Cruise and it is coming, George. It is going to be here before you know it.

I'm told here on my production notes that we've had more than 85% of the cabins booked. So people are starting to lock in, and we're going to be going to Turks and Caicos, St. Thomas, Puerto Rico, and the Bahamas. George will have an entire vat of sunscreen. I'm a 50 SPF guy. Yeah, he is. Are you really? Yeah.

You might as well just wear a head-to-toe sweatsuit. Well, here's the deal. I'm thinking I'll be pale for the rest of my life, but my face will look exactly like it did 50 years ago. Okay. That's my strategy. Whatever you tell yourself. I don't want to look like a baseball glove that got left out in the sun. Yeah.

That's not my strategy. Well, you're over here working on your third base tan. Listen, it's just called being outside. I'm not, you know. I can't risk it. Okay. Well, you know, we're going to be all over the place with the catamaran selling, jet skiing, horseback riding. I want to see you horseback riding on the beach.

I don't think horses like me. I think horses want to stay far away from this guy. Folks, listen, I'm trying to have fun with this, and you can see that he's a scared man. You're bringing up trauma. I told that girl to sell the horse. You're a terrified little fellow is what you are. You're scared. I'm going to make you get outside your comfort zone on the cruise.

By the way, I'm told there's pickleball courts on the ship. For real? Yes. By the way, people have been reaching out to me on Instagram saying, hey, I would like to set up a pickleball match with my husband and you and all this kind of thing. I'll do that for charity. It's the only way you're getting me out there.

I'll be holding court literally there. All the food is included, even room service. You can lounge by any of the pools, hot tubs. See me and other enthusiasts at the pickleball court and state-of-the-art fitness center. And you can hang out with all of us Ramsey personalities and also our exciting celebrity guests, Trey Kennedy, Stephen Curtis Chapman, Manit Chauhan, Deanna Carter, and more. This is 7 Day Cruise, March

22-29, 2025. You do not want to miss this unforgettable vacation. You can book your cabin right now by going to RamseySolutions.com slash cruise, or click the link in the description if you're listening on YouTube or podcast. That's going to be fun. I also have mad respect for anyone using a dot com slash cruise or click the link in the description if you're listening on YouTube. That's going to be fun. I also have mad respect for anyone using a fitness center on a cruise.

I'll be there. You and Deloney will be in there lifting, power lifting, some would call it. Four days out of the seven days, I will be in the gym. Jade and I will be- Got to hit the weights, man. I think Jade and I should lead Zumba classes in the fitness center. That'd be great. That'd be fantastic. There we go. Yeah. All right. That's more my speed. There we go. Yeah. All right. That's more my speed.

All right. Very nice. All right. Let's get to the phones. 888-825-5225. Sally is joining us now in New Orleans, Louisiana. Sally, how can we help? Hi, guys.

I am in the middle of a lawsuit. I joined National Vet Relief, and a year later later I'm being sued by one of the credit card companies that I put into the program. And I've listened to what Dave has said about offering a 50% cash direct offer to the companies. But at this point with us in legal situations, my question is, should I circumnavigate and go around my legal representation through National Debt Relief to make a direct offer myself to those companies and try to get us out of this mess without too much of a bleed on the back end for me? Well, let me recap for those that are confused about what's going on here with this National Debt Relief. I think this is how they approach it. They go, hey,

let us handle it. You don't make any more payments. You make those payments to us and let your credit card debt go into default. The collectors will come after you, your credit will implode, and then we'll settle on the back end. Is that how it goes? They've taken care of three of my four beautifully, but number four, they've dropped the ball on. And now you're getting sued. How far are you into the lawsuit? A week. Okay. Have you talked to your legal representation about trying to just settle this outside of court? I have talked to him before. He was the one that brought to my attention the reason why they haven't made a successful settlement already, and that was

because I didn't have enough money in the savings account with National Debt Relief. And the comment that I keep being given is, don't worry, we're taking care of this for you. You might have to put more money in, but we're taking care of this for you. I would stop giving these people a dime. I don't like these companies. I think they're scummy, and you can do the same thing on your own. You don't need these companies to do this for you. My fear is they do bring certain skills to the table that I don't necessarily have, such as the negotiation skills, and specifically because we are in a legal lawsuit at this point.

If I pull Discover from their program, I lose my representation. Because they're the ones representing you. Correct. Have you talked to your representation? He hasn't really been able to give me too much additional information than what they have. He's kind of a... I would just go, I would call the company. They're not doing you any favors here. Yeah, no more money. They want to keep stringing you along because that means more money in their pockets. Yeah, so I'm going to jump in really quick here. So I would be on the phone with them saying, I want to talk to you. I want a phone call with whoever your person is there, your customer service rep, and whoever

this representation is. I want a call. I've already paid you X amount of dollars and I'm in this mess because you all dropped the ball, if I heard you correctly. Is that right? Yes. So at this point, I've already tried calling National Debt Relief several times. I have not been able to get a supervisor. They tell me they'll call me back and we don't. I have talked to the lawyer. My lawyer has been in communication with me as well as with paralegal. But at this point, I took the last five days to devise my own plan to come up with the 50%. And according to a lawyer, we have three months before the judge makes final rendering, final judgment. What I want to do is I want to approach that credit card company and be like, look, in the 90 days, in the three months, I will give you 50% right here, right now in cash. What do you owe in total?

$18,000. What was all this debt for to begin with? I jumped into running my business before. I got laid off of COVID, and I had already had a part-time company I was running, and I ran that full-time. So it was good decisions or good intentions, bad decisions. I just feel like we're not changing any habits here. We went into this debt knowing we couldn't pay it back, and then we used this company to get a deal on the debt. And I just want you to take some ownership. You're unemployed?

No, no. I have taken ownership. I'm actually fully employed as of November. I've gotten about 80% of all of my debts worked out and straightened out. This is the last thing hanging over my head. Yeah, it sounds like you've got 9,000 cash in hand. That's what you're going to make the settlement offer on, correct? Correct. Well, I like that, George. She's taking some responsibility.

I would just go around them then and say, I've got nine grand. Can we settle this? Can we drop the lawsuit and be done with this? It's the last debt. And they'll take it. Do I do this before? Do I do this before I drop national debt relief or do I keep them in my back pocket? Well, if the debt's noted as paid in full, there's no reason to use them anymore. Okay. So don't tell them anything. But to your question, the first action is you go directly to the credit card and get it settled. Okay. And here's the thing. I don't know the fine print of these contracts that you signed, so I would read the fine

print. You might need to get outside representation, a lawyer that doesn't work for that company to look this over. So we are not lawyers, but we can't give you the advice on that. I did watch Matlock growing up. That's as close as Ken got. Which is pretty good, actually. I mean, Andy Griffiths, fantastic.

So Sally, I hope you can clear this up. I hope the nine grand does it, and I hope you never use these companies again, and I hope you've cut up the cards. Man, that would stress me out. So that's how these companies work, Ken. They say, hey, don't make the payments anymore. Let it go into default. We'll take care of it. Let them sue you, then

we'll settle. Yeah. I don't like any of this. I don't like it. You can pay off the debt yourself. You can settle yourself. You don't need to pay these scummy companies. By the way, that was a commercial for George, that phone call, to never take those services. Here's why. She can't get a supervisor on the phone.

Oh, they'll call you back. Let me tell you something. The supervisor doesn't exist. There's a guy going, hold on one second, and he's doing his fantasy football team for five minutes to make you think that he's trying to get a hold of the supervisor. He just stepped out of the office. I'm so sorry. He's not going to be able to get

with you ever. Oh, it's a scam. He doesn't exist. He doesn't exist. All right. I'll tell you who exists. We do. We'll be right back. 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 been there multiple times in my life and it's the worst. If you feel like you're stuck hiding behind masks and costumes all the time, if you find yourself hiding from your true self, I want you to consider talking with a therapist. Therapy is a place where

you can be honest, where you can talk to somebody else and reflect and learn, and you can accept all the parts of yourself over time and start living an authentic life. Masks and costumes should be for Halloween parties, not for our emotions and our true selves. And if you're considering therapy, try calling my friends at BetterHelp. BetterHelp is 100% online therapy. You can talk with your therapist anywhere, so it's convenient for you and your schedule. Just fill out a short online survey, and you'll be matched with a licensed therapist. Plus, you can switch therapist at any time for no additional cost.

Take off the costumes and take off the mask with BetterHelp. Visit betterhelp.com slash deloney to get 10% off your first month. That's betterhelp.com slash deloney to get 10% off your first month. That's BetterHELP.com slash Deloney. Welcome back to The Ramsey Show. I'm Ken Coleman. George Campbell is alongside. The phone number is 888-825-5225. Allison is up in Philadelphia, Pennsylvania. Allison, how can we help? Hi, good afternoon, guys. Thanks for taking my call. I just want to give a house. His parents have graciously offered

to basically have us buy their house from them for $350,000, which is pennies in this market with the agreement of if we were to ever sell that we would have to split the difference with them. Whose parents?

My boyfriend's parents. This is an awful idea. That's why I'm calling. Did you feel like it was an awful idea when you called or did you think it was a great idea and you're just being nice to my really dour response? I was kind of 50-50. I came from a divorced house and my parents argued about money every single day. My boyfriend's parents are still together. They live in middle class, so did we. I also have student debt.

My boyfriend doesn't have any, so I'm just trying to, I guess, think of the future. I'm also thinking, am I going to sign off on a mortgage without an engagement? So I know that's playing into it. Yeah, those are all legit questions. a sign off on a mortgage without an engagement. So I know that's playing into it. Yeah. Yeah. Those are all legit questions. I mean, George can go through the litany. That's your gut telling you, red flag, red flag, red flag, don't do this. It's not the opportunity you think it is. And also, you splitting the difference with them. What happens if you stay in this for 10 or 20 years and this house becomes worth a million bucks and you just gave away 300 grand. Right. Do you see how convoluted it is? Can

I give you an alternate vision? Can I do that, Allison? Yeah, I'm all ears. I'm willing. Yeah. Here's the alternate vision. You and your boyfriend don't live together until you get married. And when you get married, you join finances and maybe you attack a lot of that debt before you ever put a ring on it and you get debt free and you guys rent for two years or whatever it's going to take, three years to get a good down payment. George will walk you through that formula of what we recommend, but we just take our time and we're not thinking things like, oh, what a waste of time, us actually being married and not owning a home and just have this alternate vision for, hey, we can take our time and move into this and not be saddled with a really weird,

clunky arrangement. And George, explain our formula on all of this. Well, what you're looking for is 25% of your take-home pay going toward the mortgage, and that's with two married people. And there's a lot of issues with doing this before you're married. There's a lot of issues doing this with his parents involved and them having a financial gain in this. It just gets real messy. What happens when you guys, or if you guys break up? And now not only are you, hey, I'm on the mortgage, he stopped paying, but now the parents are involved with the sale of the house. And they don't like me because I don't, they're boy. It's just a mess. And I hope that

doesn't happen. I hope you guys stay together forever. But the next logical step is not, let's live together and buy a house, even though we're broke. The next logical step is, how do we get out of debt how can we take steps toward marriage and then once we're in a good financial position we buy a house but right now what's clouding your judgment is this quote deal that you're getting on this house um it's not that i mean i'm going to be 32 soon and he's going to be 36 in a month so we're kind of thinking you know we want to get married you want to start a family, start a life together. The market right now is just... Great. Do it. But you don't have to buy this house. This has nothing to do with the market. And let me tell you what happens,

because I know these stories. You guys move in together to this new house, and for four more years, you talk about getting married. Because guess what? Now you've kind of already played house. So what's the point of getting married? Why the rush? And we're broke, so we can't pay for a wedding. And therefore, you're going to build up resentment. And that's going to not end well for this relationship. And so we're just showing you what happens on the other side. We're not trying to be naysayers. We just get too many calls when people hoped it would work out a certain way, and then life happened. Right. I get it. And I, you know, like I said, you know, I came from divorced parents. I'm personally in debt. Um, I'm working extremely hard to tackle and just get rid of it. So him and I don't have to worry about it. Um, and he is a complete opposite. Doesn't have any debt. Didn't have to worry about, um, parents, financial struggles. So, you know, we're coming from two totally different point of views. And when I bring up to him, you know, I don't want to sign a mortgage away if I'm not engaged. Like, I need at least a commitment.

What does he say to that? He kind of, I don't want to say he danced around the idea, but he, like, he goes, well, we're going to do it eventually. Like, we're going to be together. Like, you know, but I really want to live together before we do. I'm like, yeah, me too. But if I'm going to sign a mortgage without a ring, like, I don't see how that's fair to me. Yeah, you're right.

I'm not going to get into my traditional views of all this, but you certainly should not sign a mortgage when you are not legally married to him. Yeah, yeah. I mean, at first I was like, I don't want to buy a house unless we're married and then i compromise with i need at least an engagement so i know it's coming no don't compromise and don't compromise make him listen you got the leverage sister he needs to step up right he's to step his game up is he gonna is he gonna pop the question or not you should play this back for him on youtube i'll tell him i'm the bad guy today i don't care man up bro put a ring on it don't put

pressure on her to get into a ill-advised deal and what's wrong with you and to use this as leverage to hang over your head is just strange oh it's manipulative it's weak say well once we move in then i'll propose i want to try it out i want to i want to live with you for a while before I decide to commit to you. This is what's wrong with men in America today. We've got all these freaking women walking around that have got a lot to offer, and they're in their 30s, and they can't get married because you've got a bunch of freaking children posing as men. We've got a man problem in the United States.

And women, you know what you ought to do? Just tell these guys. Go pound sand. I'm not going to live with you. I'm not even going to date you for a long time if you don't show some dadgum commitment. I just got to tell you, George, I get a little irritated with it.

And this is a problem. And he's in his 30s, Allison, right? He's 36. He's a man child. Why doesn't he just 30s, Allison, right? He's 36. He's a man-child. Why doesn't he just buy the house on his own? There we go. He's so financially well off. There's a notion.

Right. He doesn't have the money, right? I think I shocked Allison. Yeah. I do. You know, I need to say, like, he has been the, I know this is probably sound contradictory, but, um, he has been like the most amazing partner I could have ever asked for.

And like, we don't have any issues. Um, but you know, when it comes to this, like this is where, but when it comes to this, like we obviously have two, um, standpoints. He's, he's seeing it as let's get you know the living situation on the road and we can finally move forward and be together and he commits first like renting renting is one thing but like a mortgage i don't know i know right with me i thought we told you that allison don't keep waffling on this and listen he may be a great boyfriend but he's a boy and until he starts acting like a man, I'm going to tell you something. I wouldn't do any

of this with him. I wouldn't do, I wouldn't do any, I wouldn't move in with him either. And if that means you're renting, don't look at that as throwing away money on rent. You're buying patients. If you have to get two or three roommates until this is all figured out and you guys are married, I'm okay with that. That's how I did it before I was married and it worked out great. And it really helps you avoid so many issues that can come up when you jump into this next step, which is the biggest financial move you will ever make in your life is buying this house and doing it with someone you're not married to is a recipe for disaster. All right. I'm going to, I got to ask you, what's this, if this were a dating show, what's your statute of limitations? If I, if I can borrow a phrase on how long a guy should be in a serious relationship like this before we start to say, Hey dude, you have commitment issues.

Here's what I'll say. What's the length of time? If it's high school sweethearts, I think you can get more time. If you're in your 30s, I give it two to three years. Max. Oh, that's way too long. Two to three years max. I think a year. I think 12 months. If you're in your 30s and you've been seriously dating someone for a year, if you can't decide by that point whether or not they're a life partner, you're out.

I like getting past the first year. That's when you finally have your first fight. The first year, it's all gumdrops and rainbows. No, I think that's about a three-month period. This is fascinating. You've got to know how they fight. Conflict is everything. You got to know how they fight before you say yes. Yeah. All right. Ken's an old man, but I think we're on the same page. I believe in commitment. Been married 26 years. I believe in a thing called love. Take that and stuff it. This is The Ramsey Show. Okay, here's the hard truth. Your investment dollars could be winding up in the pockets of companies that hold positions you don't agree with. People are unknowingly putting money into

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investing, carefully consider a fund's investment objective, risk, charges, and expenses contained in the prospectus or summary prospectus available at TimothyPlan.com. Read carefully before investing. Mutual funds distributed by Timothy Partners LTD and ETFs distributed by Forsyth Fund Services, LLC. Welcome back to The Ramsey Show. I'm Ken Coleman. George Campbell is with me, and we are here for you. 888-825-5225 is the phone number. 888-825-5225.

Portland, Maine is where John is waiting. John, how can we help today? Yes, hi, how are you? Good. Thanks for taking my call. You bet. What's up? So I'm looking to make the right decision here. I've made a lot of right decisions and a lot of wrong decisions over

the years, but we've been, you know, paying a lot of stuff off where at the end of baby step two, I have a side hustle and a full-time municipal job and the side hustle is growing and growing fast. We've gone from two cars down to one as we've paid off a lot of stuff. But I'm at the point where I kind of need a second vehicle to get to some of these side hustle jobs and the opportunity to make a lot more money, almost double, through the side hustle. What's the side hustle? Do you mind if we ask? So I install emergency vehicle equipment, emergency lights, sirens, police cars, fire vehicles, stuff like that. No kidding. So a lot of your customers, I guess, are municipalities

and counties? Oh yeah, a lot of them. Correct. Very cool. And so if I understand you correctly, you paid off car, you sold a car, but you're down to one vehicle and you need another vehicle just to allow you to get to the work and that will allow you to double your income. Yeah, so I've recently changed the business model a little bit. Instead of building full police cars for municipalities, I've found it more profitable to do what I would call service work. Say a department needs 10 new computers installed and already built. It's kind of like doing brakes and struts instead of engines, if you want to think of it that way.

It's just simpler, and you can knock more out. Nice. Correct, yeah. So the money has been great over the last few months. Going forward looks great, but it takes me a little bit further away from the house. What's left? Sharing a vehicle with my wife and four kids.

Go ahead and ask your question. What's left on the debt? One vehicle right now, a Ford Expedition for the family, a wife and four kids. She stays home and homeschools. They do co-ops during the day while I'm at work, so they do use the vehicle to go to different, and it's worth about $35,000, and we owe about $27,000.

And we've paid off a lot of credit card debt, a lot of other debt, and that's all that's left. How much more money would you be making per month if you can add these new clients? Probably on the low side, $3,000 to $4,000 more a month if I can get to two of these jobs a month that are a little bit further away. What if you slowed down your payoff of this car in order to use that cash to buy a used car to get you from point A to point B? So another to put to give you the full picture

another thing because I found the Ramsey show about a month and a half ago we were already doing a very very similar process but I've been investing 8% to 10% of my pay since I've been with the city here for eight years. So my other question is, should I pause that, which would add $450 a month onto our payoff plan? There's already $150,000 in a 457A. Should I pause that for a year or so while I get the rest of these paid off? Yes. Okay. Regardless of your situation, we tell folks to pause investing during Baby Step 2 because of the accelerant.

Yeah, definitely. So to put it in perspective, the car I was looking at was about $12,000 for the business. I would buy it and write it off with my LLC. Do you need a specific car for this business? No, I need something. I'm looking at an EcoSport, something very small, good on gas. Me and a tool bag, me and a toolbox. I don't want anything big.

I feel like you don't need to spend $12,000 to get just a car from A to B if it's not like a work truck. So are there things that are in the $5,000 to $6,000 range? I'm going to try the $6,000 to to 8,000 to get that decent little eco car. I think you could do that. So, yeah. Yeah, no, I definitely hear what you're saying, especially with the automotive mind. The only other thing I've thought about, which is crazy to think about, is that my oldest is 10 now.

Buying this $12,000 vehicle, there's a job coming up that I could take that's a week long that I'd travel to in December for a week and probably make $13,000 in that week and pay. Well, here's the deal. What does that have to do with the 10-year-old? This could be his first car if I buy something that's going to last five years. Oh, I get that. I get that. This might be a six-month car. You might upgrade. Once you're out of debt, upgrade to a little bit better and then upgrade to a little bit better. And the chances are he's going to want a different car that's his, that he gets to go shopping with you. Yeah, we're trying to save you $6,000 now. I'd rather save you that kind of money now, and then six years from now, the whole different ballgame. Yeah, I understand. That makes sense to me. Yeah. So, John, what I would do if I was in your shoes is I would pause investing,

I'd slow down the steps in order to save up real quick and get you a beater car to then increase and increase the speed of the baby steps. Did you say you're mechanical? You can fix cars? Oh, let me tell you even better. I can barely put gas in a car.

All right, full admission. I have no skill at all. But if I had your skill, I'd absolutely be looking at something really, really cheap because you can fix it up and keep that thing moving, you know? Something with like major gas mileage is just you, you know? We also, we bought our house back in 2013 when the market was the opposite of what it

is now. So we're in a really good position there as well. That's great. Sounds like you're doing great. Welcome to the tribe. you're doing great. Welcome to the tribe. You're doing great. As far as just the last thing, you know. And I think later on,

this might become your full-time gig if you want it to be. Could you do this full-time? Could be. I could. The stress of running the own business. And this is kind of a good work-life balance. I didn't grow up with any structure, nor did my wife. So we're trying to get the city job, give that to the family, and then the side hustle's been great, too. What's your biggest stressor as a solopreneur?

So doing the full police cars, they could take, doing them on the side, I could have one vehicle apart for three to four weeks, and it's like when my mind's on the project, I can't get it off the project. So it's done. I got shifting to this new type of work where I go to the, you know, I go for a day or two or three.

And when I leave all the work's done and I don't think about it. So I have found ways to good to make that better. But, uh, long-term I call it the best of both worlds right now, but you are right. That could change in four or five years. You might be able to find a guy who's also mechanically handy and you delegate

it and you have a little team. Who knows? I like that idea. I'll tell you what, if I'm him, again, you look for some young dude coming out of high school that needs to prove to his parents that he could make good money as a mechanic and doesn't want to go to college, I'd get that kid in there and mentor or teach him. Or a guy who doesn't want to work in the traditional

mechanic role. This sounds like a cool, you know, you get to be a part of a startup business. That's really cool. Make good money. You could really grow that thing. Wow. Side thought, but I like it. Riches in the niches, Ken. Oh, is it? I don't know. You're so happy with yourself. I think that's nice. I wish, if you weren't watching on YouTube, you should have seen how smiley you were when

you said that. Did you like think about that phrase today before the show? I think you're upset because you didn't say it first. I'm going to be honest. You love a good rhyme. I'm sick with envy. Exactly. Can we help Renee real quick, George? Let's do it. All right, let's try. Renee is in Fresno.

Renee, how can we help? Hi there. I was calling because I'm currently in baby step number two, but we're actually probably going to have all of our be out of that step by next year, like mid next year. And I was calling because my husband retired from the Navy and we found out in his retirement that if our girls go to college in California and a UC or state school, their college is completely paid for. Amazing. So, yes. So I'm still wondering if I should be saving for either a college fund or put a savings account for each of them in a high-yield savings account in case they either want to go out of state or maybe towards a master's program. I'm just kind of trying to think down the road. I would, but I would not until you're out of debt with an emergency fund and you're investing 15% for your own retirement.

Okay. Otherwise, there might be extra things, living expenses, books, who knows what they might need to cover. I would work with them to create a plan to work and save along with mom and dad working the money plan. Okay. Okay, perfect. I think that was everything. That's incredible. Fantastic. Thank you so much, Renee, for the call. And we also need the stipulation, you are going to one of these in-state schools that's completely paid for. We don't get to choose, but I really want to go to XYZ private school across the country.

Well, you better have the money to pay for that because mom and dad ain't paying. Yeah. Yeah. Especially in this situation. Absolutely. They need to know the value of what that education will do for them debt-free. And if they need that, go watch Borrowed Future on YouTube. It's a documentary we created, completely free to watch. It will change the game with these conversations. And Ken, you do a great job in it, laying out some facts. Well, you know, we're in a world today where the value of a degree is increasingly fading with the American people. And we're starting to see that it's fading within the workplace with many, many major organizations within different industries saying we don't require a

college degree anymore. So the more you pay, the more you go into debt for it, the less ROI. Yeah. Good stuff. All right. Great shacket today, George. Thank you. It matches your glasses.

It's always a pro move. Thanks for hanging this hour. This is the Ramsey Show. Do you ever feel like you're finally making progress towards your goals only to get quickly distracted by something else in your feed? Well, that's why we created the Ramsey Network app, your single source for content that keeps you motivated. The Ramsey Network app is designed to keep you laser focused on reaching your goals.

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We help you win with your money, win in your professional journey, and win in your relationships. 888-825-5225 is the phone number. 888-825-5225. I'm Ken Coleman. George Camel is with me. It's Coleman Camel time, and we are here for you. Let's get to the phones. Jeff is on the line in Denver, Colorado. Jeff, how can we help? How are you guys doing?

Good. How are you? as like a side hustle. My second house is about to hit the market within the next week. But my question is, I'm going to have about $160,000 in profit once this sells as my estimated profit. How do I shield myself from this massive tax bill that's going to be coming my way? How massive is it? Have you actually done the math?

Yeah, I'll be about $160,000 of profit that I'll need to pay taxes on. No, he's asking, have you done the math on your taxes? But, you know, depending on your bracket, what your marginal tax rate is versus effective tax rate, are we talking, you know, 16% of that? I don't know what the taxes are in Colorado. Yeah, I'll be about 20% of that. Okay. Have you already figured in, like, you have existing expenses just on the actual renovation? Not yet.

Okay. Well, that's the first thing. I hope you got some accurate records on all that you spent, correct? Yep. I got everything documented of what we put into it. What do you think the ballpark is? Like we put $160,000 into this last property. Okay. Well, you put $160,000 in and you got $160,000 out? $160,000 is from both properties. I think I made a profit about $80,000 from that first property and about $80,000 from the second property. But you said you put $160,000 in. Into the investment, yeah, to flip it.

This is bad math. It's telling me that you're not making money in this business. So let's start over, Jeff. Either I've confused you or you're not tracking with us, okay? Okay. So you've got one house that you're saying or is it two houses that you're saying you've got the total profit of 160 two houses so i sold a house in february this year and i'll profit 80 000 on that um i i profited 80 000 on that house and then this the second house is about to hit the market, and I should profit about $80,000 on that.

Is that after getting your money back from your initial investment? Correct. Okay. All right. I got scared. I was like, oh, no. I did, too. It wasn't making sense.

Okay. So the bottom line is you need to get with a tax pro. George and I are not tax pros. RamseySolutions.com, great place for you to see a good list of tax pros, and I would contact them. They'll help you find every legal nook and cranny to go, what can I write off as a deduction from this business? Is it through an LLC you're doing this?

Correct, yeah. Okay. Well, the reason we want you to go to a Ramsey preferred or the approved tax pro is because a lot of accountants and tax people out there will try to get you to spend money just to lessen your tax bill. And to me, that's about the most mind-numbingly stupid advice I've ever heard. Well, go buy this and go buy that. Go buy a G-Wagon for $130,000 and you can write it off. Just to save money on taxes. No, save the money and pay Uncle Sam. And that's just how it is. So

with your regular expenses and everything else, that's what you're looking for. But don't get sucked into that idea. Just a warning. Okay. That's good. Cause yeah, I was, people have told me to go buy a new truck and I don't need a new truck. Thank you. Never spend to save. Yeah. Don't spend money to save money. It makes no sense. So you're a good man. Appreciate the call. And congrats on flipping the houses there. Yeah. And just set aside that money and put it away in a high-yield savings account and then be ready to pay that with your quarterly estimated payment.

Don't wait a year, year and a half to make these tax bills. Make sure that you're paying that quarterly through the IRS website to avoid any fees and penalties. All right. Sarah's up next in Detroit, Michigan. Sarah, how can we help? Hi, thank you for taking my call. I'm a tad nervous, so I apologize. You're doing great. Thanks. I'm very nervous. So I was wondering if it would be in my best interest to take money out of my brokerage accounts to pay off my Parent PLUS loan.

How much is in the brokerage account? The two brokerage accounts are about $93,000. Okay, and how much left on the Parent PLUS loans? Well, I'd say about $68,000. I just started paying this year. Okay. And what were you saving up in this brokerage account for? Because this is non-retirement. You're just investing on the side. Yeah. When I first got married 29 years ago, I just opened up some IRAs in this brokerage account, which I didn't even realize what it was until just recently. I just put that money away and I never touched it. Good. Well, the good news

is this is likely long-term capital gains. And so it won't be a crazy tax bill, but you will have to pay taxes on the growth of this money. And so I would pull out that $68,000, be ready to pay the taxes on that and be done with this debt. Get it out of your life. And the interest rate on these Parent PLUS loans is excruciating. Yeah, it's like 7%, and I want to pay it because in the long run, for one, I don't want to give the government any more money than I have to. Amen. And that's going to double by the time I get them paying it off. Yeah, you have the money, I would just go ahead and pay it. And it's going to hurt a little bit because you've worked hard to invest and save this money, but it's for a purpose. And right now that purpose is to pay off debt.

And for the rest of your life, it will be to instead build wealth and leave a legacy. And so I'm sorry that you got to use it for something not fun, but that's kind of the price we paid when we signed up to pay Junior's College. I know. I know. So I was worried because I don't know how to figure out the capital gains, but... That's a simple fix. I'll try and do that on my own. Yeah, it's a simple fix. You can reach out to a Ramsey-trusted tax pro at ramseysolutions.com slash tax.

They can help you figure out what you're going to owe and help you figure out what you need to set aside in order to pay this tax bill. But it's not going to be anything life-changing. It's not going to be a $25,000, $30,000 bill, so you don't have to worry about that. But you have the money to pay it? Well, I was thinking if I take out the full $93,000, I'm going to save some back to pay for the taxes. Sure. You may not need to. I won't use the whole $93,000.

If you don't need to use the whole 93, you don't need to pull it all out right now if you have other goals. I'm going to pay off my credit card debt. Oh my goodness, you buried the lead, Sarah. There's the story. Do you have any other debt you'd like to disclose? I have other debt, but no one asked me

that. You're the best, Sarah. I listen to your program, so I know about the cars, but I don't to your program, so I know about... She's like, well, do you? She listens so she knows what to reveal and what not to reveal. She don't want our advice on these other things. Just that one.

I would pull as much as you need to pay off all of your debt and pay any taxes due. Yeah, because I still have a bunch of 401s and stuff. Would the 90... So, Sarah, would the 93 make you completely debt-free? It would probably pay off everything but my cars and my mortgage.

Alright, that's a start. How old are you? Well, I'm 58. I'm old. Where does 60-year-old Sarah want to be? Does she want to be debt-free? When did 58 become old? I don't know. Ken is heading there. I'm married too, so. Okay. I'd make a plan with your spouse and go, hey, let's go into our 60s completely debt-free. Let's have a retirement that we're proud of, a legacy we're proud of, and not having to scrape by. So that's what I would be aiming for. And liquidating this brokerage account is one step toward that. I'm proud of you. Yeah. Thanks for the call, sir.

58 is not old because that hurts Ken's feelings. Well, to be clear, I just turned 50. All right. So, you know, it's all perspective. Halfway to 100, Ken, just saying. Thank you, George. This is the Ramsey Show. A lot of financial institutions don't care too much about you, but they care a lot about getting their sweaty hands on your money. They have fancy furniture and marble columns in their lobbies because you're paying for them with high fees just to access your own cash. But Fairwinds credit union is different. Guys, you know I prefer credit unions because of their membership focus, lower fees, and better experience overall.

Fairwinds has been in business for over 75 years, and we're excited to endorse them because they share the Ramsey mission of helping people get out of debt and living generously. They won't try to force debt products and loans on you, and it's easy to join Fairwinds no matter where you live. They serve hundreds of thousands of members worldwide. Anything you could do at a bank branch, you can do on fairwinds.org. Plus, your deposits are federally insured by the NCUA up to $250,000. So talk to my friends at Fairwinds and check out the combined checking and savings

account bundle they created just for Ramsey fans. Go to fairwinds.org slash Ramsey to learn more. That's F-A-I-R-W-I-N-D-S dot org slash Ramsey. If you own a small business and you like the Ramsey Show, then you're going to love the Entree Leadership Podcast. Almost 200,000 listeners tune in every Monday to hear me take calls from real business leaders and give tactical advice based on my 30 years of experience leading. This is not a podcast about business theory. It's real insight from a practitioner who actually does this stuff. Find it anywhere you listen to podcasts, or if you're listening on YouTube or Podcast Now, just click the link in the description. Welcome back to The Ramsey Show. I'm Ken Coleman. George Campbell is alongside. The phone number for you to jump in is 888-825-5225. It's time for a question of the day, George.

And today's question of the day is brought to you by YRefi. YRefi refinances defaulted private student loans and builds a custom loan based on your ability to pay. You will have a payment you can afford with a low fixed interest rate you couldn't get anywhere else to help you stick to your budget, work the debt, snowball. Go to YRrefi.com today slash Ramsey. That's, let me give that to you, though it's not written well, and I'm like a parrot here, George. I'll reread that. It's whyrefi.com slash Ramsey. That's Y-R-E-F-Y dot com slash Ramsey. This may not be available in all states. Today's question comes from Colin in New Hampshire. I recently got my license to be an architect. I'll be having a conversation soon with my bosses about a new role and responsibilities, which should include an increase in pay. I have no

reason to suspect that my employer would underpay me. However, I would like to go into that meeting with an idea of what a fair salary would be. Looking at the numbers online, they range anywhere from 65, which is less than I make now, all the way up to 100K. I understand there are nuances to salary, such as years in the field or type of experience. This makes it difficult to gauge, quote unquote, fair. I want to manage my expectations of what I should be making. Where can I find accurate salary data to know what fair is? Yeah, good question here from Colin, and I would just focus on the fair part of this. The fair part is really the wrong thing to be focusing on. You've got to set your range based on what you're making now. And so he's saying the low range is 65. So he's already done his homework.

So wherever you got this information is the same place that you're going to look at for what's right for me. So you're just looking at comparative salary analysis for people with experience and skill set similar to yours, and you're going to look at where you're at on the range. So he's already given us the homework. So 65 on the low end, 100K on the high end. And so where do you fit in that range of salary? And so if you're in that range of 80, then I would ask for the full.

I would go to the full number, maybe go a little higher because it can always come down. So maybe if you felt like, all right, I feel like accurately I could command an $80,000 salary, I'm going to ask for 85. That's what I would do. So aim a little bit higher. A little higher. Give that company a little room to come back with a counter. Yeah. And you've got to know what your number is where you go, I would not feel good. I would feel resentful coming into the office every day. Now, hopefully that, again, is based on viable information, which Colin has gone out and

done the research. And he said, I just got my license, which tells me he might be more entry level. So I wouldn't expect the full 100K. But I'd also want to know when I go in, what does a growth plan look like to grow in this role? What is that ladder if I want to step in and have more responsibility? That would at least help me not flounder in the role going, well, I should be making more. Well, who said? That's right. That's exactly right. So good question. Really good question. To the phones we go. 888-825-5225. Rachel joins us.

She hails from the Washington, D.C. area. Rachel, how can we help? Hi. I'm in a pickle. And I really don't know what to do. Okay. So I am, right now I, too, believe, like, the U.S., the cost of living in the U.S. is outrageous. And so we're overseas just to kind of get the cost of living down. We are currently living off of VA benefits, veteran benefits right now.

Okay. How much is that? And my husband has a what? How much are your benefit payments? Total four grand. A month. And that's what you're living off of. That's from your husband's service or your service? Husband. Okay. All right, keep going. And then, so that's why we're currently share. recently got a job offer that pays a stipend and room and board, $18,000 stipend, and then housing. What about salary? Yeah, so it's $18,000 for the academic year for nine months.

Okay, I'm confused, Rachel. What is the job that you just got offered? Tell us where that is. It's a residential hall director at a university. And so you're only going to make an $18,000. That's what the stipend is. Yeah. And then they provide housing and meals.

And meals. Okay. All right. And so what is the dilemma? This is in the U.S., I'm understanding? Yes. Okay, so what's the dilemma? Where are you at? Where's your husband at?

Working. No, no, I'm sorry. Where's your husband on this idea of you moving back to the States? Where are you at on moving back to the States? It feels like you want to do this, but I'm just getting clarity. Yes, I want to. That's the thing. Like, I want to honor and respect my husband.

I'm, you know, I'm Christian. However, like, we've done this before, and I've developed a lot of anxiety overseas, being away from friends, family. Okay, so Rachel, let me jump in. So he wants to stay, you want to go. Thank you, George. Is that right? Yeah. Does he know that it's causing you all this anxiety? I assume this relationship is not going great overseas. Yeah. So if I'm him, I want a better marriage, and therefore I'm going to compromise and go, okay, let's go back to the U.S. and figure out how to afford to live there,

because living overseas is not the solution to the cost of living issue. How can we help you? Okay. It's just a lot. I know. I know, sweetheart. We have about three minutes, and so we want to try to help you. How can we weigh in? Where would you like us to weigh in? So my husband has a real estate business. I use that kind of lightly. Not really, but kind of. So last year he made a hundred grand, but he got the properties in 2022 and then sold them in 2023. And are the real estate, is the business in the United States or overseas? Yes, in the U.S.

And he's managing all of this overseas? Yes. Okay. And he's managing all of this overseas. Yes. Okay, keep going. And anyways, so, but he hasn't made an income in a year now. So I'm in the dilemma of like, do I stay overseas to support him and his business or do we move back to the u.s i don't understand how you staying in asia supports his business when his business

has not made money in the last year it's in the united states it's across the world i am so confused about all of the details around this except for one thing i'm not confused about you guys have a massive massive marriage issue and you got your husband who wants to stay in the in the in the stay overseas and it stresses you out and you've done this once before so we've got a track record you don't want to live overseas he wants to live overseas you're willing to go get an eighteen thousand dollar stipend to be an RA just to escape wherever you are this is not good we have to get on the same page quickly well the reason the reason why I wanted to take the um the job at the university is so that we could save the four grand a month okay but, but would he move with you?

Would he move with you? Yes. So that's what you wanted our opinion on is should you take an $18,000 stipend to get out of wherever you are? You guys were making 150 grand between his business and the VA benefits. So this is not a cost of living issue. You guys need to move back to the U.S. and both get normal jobs.

Yeah, that's... And stop finding weird shortcuts. Yeah, and like taking this, well, we can save the $4,000 so he doesn't have to work. It just, the whole thing is so anti to what we believe here. Yeah, move back and start working

and get a marriage therapist quickly. This is The Ramsey Show. Hey guys, George Campbell here. As a new dad, I see a lot of things in a new light. The cost of diapers, the value of sleep, and how crucial it is to have a will. Because if something happens to me, I don't want my family stressing about the details. And that's why I recommend making a will with Mama Bear Legal Forms. A will gives you peace of mind knowing things will be taken care of the way you want, instead of a random probate judge deciding

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Hey guys, are you ready for the secret to help you reach those money goals that you've been dreaming about? It's simple. You got to get on a budget. With our budgeting app, EveryDollar, you'll get intentional with your money and build the habits that will make those dreams a reality. And we'll be with you every step of the way from your first budget to that retirement home on the beach. Download EveryDollar for free on the App Store or Google Play. Remember today, download EveryDollar for free on the App Store or Google Play today. Welcome back to The Ramsey Show. I'm Ken Coleman. George Camel is alongside. The phone number is 888-825-5225. We'd love to take your calls about your money, your professional journey, your work, so we can make more money, and your relationships. 888-825-5225. All right, I want

you to think about something for me, George. You ready? Okay. Hit me. Can you be imaginative? He's closed his eyes. It's good. I want you to look up a year from today, and you finally accomplished all the things that really matter to you. How does it make you feel, George? Amazing. Accomplished.

I'm floating. Yeah, absolutely. Does that involve going on vacation with me? That would be a dream, actually. The Coleman's Vacation. I thought so. Achieving your goals, George, doesn't happen by chance. You need a plan so that you stay focused, motivated, and organized every step of the way.

That's why we're excited about the new 2025 Ramsey Goal Planner. It's packed with monthly teaching from Rachel Cruz, Jade Warshaw, and John Deloney. And it's going to help you set goals with your money, faith, and relationships. And it's got all your favorite features, monthly and weekly calendars, stickers. Wow. It's got stickers. Do you like the stickers? I think it can be fun.

All right. Vision board, goal-setting system, savings tracker, and more you can get yours today for $49.97. Don't wait. This planner always sells out, so you want to get the best price, go to ramsaysolutions.com slash store, ramsaysolutions.com slash store. All right, Brian is up in Boston, Massachusetts. Brian, how can we help today?

Yeah, hi. Thank you so much for taking my call. So I did have a question for you. I currently own two homes, our primary home that we live in, that we owe about $223,000 left, and we do have a rental property, uh, that is paid for. Unfortunately, I took a line of credit. I, uh, accumulated about $125,000 in debt there. And I have about another $35,000 in credit card. Uh, my question to you is, should I consider selling the rental property to pay off my debt and pay down what I primarily own on my primary home or continue using that as an investment, which is bringing in monthly income every single month? If it's bringing in monthly income, you wouldn't be upside down going into debt every month. So clearly it's not the investment we wanted it to be. What have you

been spending this money on? The line of credit was when we moved into the home, we didn't have, we didn't plan correctly, should I say. We ended up spending more, moving into a much more affluent neighborhood, and we did, I think, overspend. I would say so. I'd have a hard time blowing $120,000 on a move-in. And what about the $35,000 in credit cards? Part of that was a program that I decided to take, and the rest has just, at times, I may need to use the credit card to help. That's what I'm saying. If this was such an income blessing in your life, you wouldn't have to turn to the credit card to spend.

And so that tells me we have some spending issues and habits here that we need to fix. And so I would probably recommend selling this rental. What can you get for it? Right now I could sell it for about $375 after taxes and realtor fees, maybe get about $310. Okay. So let's say you took $310 and you paid off the line of credit. That's $125. You paid off the credit card. That's $150. That leaves you with another $150 to throw at your mortgage, leaving with about $75 left000 left on the mortgage. Correct. And frees up those payments, right?

Frees up the credit card payments you're making, frees up the line of credit payments. What is your household income without the rental? I myself, without the rental, I make, depending how much overtime I work, anywhere between $150, $250 a year, and my wife around $120. Nice. Amazing. So you guys were making $370? Yeah. And you couldn't cash flow any of this? Yeah, I think we've always been struggling

ever since I was 12. I've been working... This is not a work issue. You've got a spending issue. If you're blowing through 370 and going into debt, that's the part we need to focus on here. And I think selling a rental is just one step in getting us a clean slate. But as soon as that's done, we need to refocus our habits and go, we work too hard to be this broke. Would you agree? I would agree. You guys have been working your tails off. I think that I partially these past several years we've been able to putting away for retirement.

I think I was just going about it the wrong way. So we've saved up about $750,000. Wow. But, of course, that's in retirement. That's, you know, I can't touch that money. Yeah. So how much have you been putting away a month towards retirement? We, the past, I don't know, four or five years, we've been putting away – we've been maxing out.

Okay. Well, the good news is your investing muscle is strong. You've got a great investing arm, but you're atrophied at your spending muscles. That's where all this is getting burnt. And so I do think you can keep investing, but I would definitely ratchet it down to 15%. Once everything's sold, make sure you have an emergency fund, get completely debt-free outside of your mortgage that's left, and then invest 15%, and let's start attacking this mortgage and be done with that. Probably within a year, you could be done. Making 370 with 70 left would you agree we can knock out the mortgage

i would i would tell i definitely agree i guess my my concern on selling the rental property is i always viewed it as a safety net um um not to get into past but my father always had a gambling problem and so i've always been afraid of of being without you've been tearing holes in your safety net with this line of credit. And so if you're telling me it's a safety net, it's not. So I would find your own safety net and that's an emergency. Not the line of credit. Right. I totally agree with you. I'm just saying if you're leveraged up to your eyeballs, there's no safety in just owning that asset when there's all this debt attached to it.

And the rental property is not spitting off enough profit. What are you making per month after all expenses on the rental property? The rental property? After you pay your line of credit. Oh, after I pay, I was making 23. So here's the other dilemma I have. 23.50 is what I was making on it. Of course, I then would have to pay the line of credit, which was around $1,200 or $1,300.

So we're doing all this for about $10,000 a year? Yeah. Correct. If I were to do college students, I can bring in about $4,500 a month. No, the point is, we're trying to help you see it's not worth it. This is a great opportunity for you to reset. Your overtime is much better ROI than making the $10,000 managing a property. Sell the house. It's not getting you the ROI that you think. And if you want real estate down the line, wait until your house is paid off and then save up cash with this amazing income and no debt payments and you will be buying up real estate in no time. And the 100% cash flow is going to help you buy the next one and the next one. And yes, it's a slower route, but it doesn't lead us

to where we are today. Making a crap ton of money with not a lot to show for it. Going into debt every single month. So I wish you the best changing your family tree, Brian. It sounds like you want to. You don't want to live the same life that your parents lived. You want to leave a different legacy. And that's going to take creating different habits. So I'm going to send you a copy of my book, Breaking Free from Broke. I hope it convinces you that the debt system is not a path to wealth or peace and that you can live outside of it.

So hang on the line. Christian will pick up. We'll send you a copy of that. Best of luck to you with the sale of this rental. Yeah. And getting completely debt-free. And he could clean this up. The shovel's amazing, Ken, making 370 households.

And he has saved a really nice chunk in retirement. So it's not like he's unstable. It's just the system he's been, or lack of a system, I guess I would say, that he's employing is not as effective as it should be. But he's done a good job. And to your point, the money's there. But I would get out of this thing now. And I talk about the flat tire analogy. Some people are really good at saving and investing, but they have spending habits and that's a leak in the boat. We got to fix. That's a flat tire. And so I like being well

rounded where we're giving, we're saving, we're investing, we're spending. We can do all of those things, but it has to be well-rounded and in the right ratios at the right time. Yeah, because it does pay off. It really does. It doesn't seem like you've got a great strategy until you wake up 20 years in and you realize you're ahead of everybody else. And Ken, you work out, you understand. You can't just do leg day. You're going to look weird. That's absolutely right. You got to do some full body stuff. You can't skip leg day either. I've been skipping. Have you seen these guys at the gym with a giant upper body and their legs look like noodles?

I'm right here. You don't have to talk about me like that. My noodle legs, my skinny jeans. That's fantastic. All right, George is going to do some squats during the break, and we'll be back before you know it. This is the Ramsey Show. Hey, folks, Dave here. If you haven't booked your cabin on the Live Like No One Else cruise, This is the Ramsey Show. We'll be sailing the Caribbean March 22nd through the 29th, 2025,

stopping at the incredible Turks and Caicos, Puerto Rico, St. Thomas, and the Bahamas. Hurry to secure your spot with a $600 deposit today at ramseysolutions.com slash cruise. Welcome back to the Ramsey Show. Thrilled to have you with us. I'm Ken Coleman. George Campbell is with me. 888-825-5225. We've got to mention this network app really quick because this is so fun.

It's kind of a new thing, and I want to mention it on the front end very quickly. We will wrap up this hour of the show. People need to know that if you're listening on radio, we'll continue. But if you're on podcast or YouTube, this is it for what you're going to get today. But you can get the rest of the calls, and we've got a great lineup here as I'm looking on the board. Some great calls coming up. You can get it on the Ramsey Network app. You can get that in the App Store or Google Play.

I just want to mention that real quick as we head into this segment. Instead of mentioning it at the end. In case we run out of time. That's right. Lest we run out of time. Very good. I was hoping you'd be impressed. Well, I love the word lest.

It doesn't get used very often. I don't think many people your age even know what it is. You bring out the best in me, Ken. Thank you. Let's go to Trayden in Indianapolis, who is joining us now. Trayden, how can we help? Hey, thanks for taking my call. You bet. Here's my question for you. So I just started my fourth year of college for my degree in criminal justice, but I recently found out I'm going to have to take at least an extra two years after this one to finish my bachelor's degree. I just

started a new job where I'm making $100,000 a year right now full time with the option to get upwards of $150,000. So I guess my question is, is it worth it to continue with school to get my degree that I most likely won't use or drop out and pursue my career? Well, the way you just positioned it, no, it's not worth it to stay. But let me backtrack a little bit. Why are you being told all of a sudden that you need two more years for a total of six years for your criminal justice degree? Well, during my sophomore year, I lost one of my good friends of mine and I didn't focus that much on school. So that's where I got behind.

Oh, I see. So you said you just found out. It wasn't like the school dropped this on you. This is just, you don't have as many credits as you need. Yeah. Oh, okay. Okay. Well, what's the job you're doing now where you're making a hundred grand with the potential

to make 150? I'm a pipe cutter. Fantastic. Do you like it? I'm a pipe cutter. Fantastic. Do you like it? I love it. Oh, man. Done. Give me my gavel and my rope, George.

The jury has spoken. I absolutely would drop out of college. Okay. What's the other alternative here? You're in school for three more years to get a criminal justice job that pays half of what you're making now? Yeah. Yeah.

Yeah. No. What sense does that make? Does that make any sense to you? Trayden? What was that? Does it make any sense to you to stay in? You called us.

It's your call. Do you think it makes any sense? Okay. Unless you said, I hate this pipe fitting job. I really love criminal justice. I need to do this. It doesn't sound like that's the case. Did you kind of fall into, well, I guess I'll do criminal justice?

Where did this come from? I used to. I always wanted to do it. And then now, more recently, with how cops are looked at nowadays and everything like that, I just don't. And the pay cut. I love what I'm doing right now. I absolutely love it.

So it's just kind of hard. Listen, I'm glad you called. And the reason I asked you what do you think is because at the end of the day, it's not about George and I's opinion on this. And I think you were probably leaning in that direction. And I'm going to tell you, you have a path to not just 150,000 you have a path to being a multi-millionaire because you you will eventually learn this trade to a point where you may end up owning your own business I'm assuming that's crossed your mind yeah yeah now you're creating jobs and and and so this is a no-brainer and and I appreciate the call, though, because I think a lot of people think, man, I've been in it this long.

I don't want to be a college dropout. You're talking to a college dropout. I am a college dropout, not a loser, not a grifter, drifter, all the things, right? I just knew that it was time to go work on campaigns, political campaigns. And so I didn't need to sit in an upper-level government class when I had the opportunity to go be in part of the fight. And that was my path. And then I ended up moving into my early 30s into broadcasting,

which, again, didn't require a degree. So it's always, is a degree required or is it the best way? So the only way or the best way and in this situation you've got really clear direction for your future so i say drop out and don't let anybody talk you out of it okay you got any student loan debt or any other debt uh i got maybe 15 000 okay you can crush that as you start working i would aggressively pay that off. He's already working. And get an emergency fund. You already got the job making 100K? Yeah. Okay. Man. Well, now with your focus fully on this job, the sky's the limit. Knock out the debt, get an emergency fund, and start building some wealth, my friend. Yeah. You know what? He's not

broke, but I want to keep him from being broke. So I want to give him a copy of your book, George. I appreciate that. To avoid the traps. There's a lot of them out there. You don't have to be broke to get a lot out of your book. And I want him to have a good path going forward. As you start making money, that's where the traps show up. You start to inflate your lifestyle, and this book is going to help you keep you on the straight and narrow trade. So hang on the line.

We'll send you a copy of Breaking Free from Broke. Appreciate the call. Absolutely. Catherine is up in San Antonio, Texas. Catherine, how can we help hi oh this is so exciting okay I've always listened to Dave Ramsey and like I followed his advice and completely out of debt I just this month that passed reached over 100k like net net worth like super liquid and nice way to go Catherine hello thank you and I have like no debt we have me and my

husband have no debt like awesome so all investments um and thanks to the room because I'm like a first generation immigrant so oh definitely that's what's up amazing yeah and so I guess my question is this now that you know we're at a point where we are managing like in the six figures I'm trying to figure out if I should invest in like mutual funds or ETFs or like kind of what balance to have. I'm trying to figure out, like make my money grow. Right now I have a target retirement fund for my Roth, but it's got like a 7% return annual. And I think those typically are lower than. What account are you talking about? Is this your retirement? Is it an IRA or a 401k?

Roth. That's a Roth. But is it a 401k or an IRA? You can have different... IRA. Okay. So this is not through your employer. You set up a Roth IRA. You're maxing it out every year, I imagine? The Roth, no. So that's kind of what I'm trying to figure out. So I'm maxing out the benefits in my traditional 401k. Okay. Do you have a Roth 401k option through your employer? I do, and I actually just changed that. To traditional? So 4% Roth to Roth and then like the 3% to traditional. Why the split?

I just heard that like at this income level that I'm making, it's like good to keep your tax rate from going up, but also taking advantage of my current tax rate. It's good to split half and half. So you're doing it slightly for the tax deduction because on the Roth 401k, you don't get the tax deduction. Yeah, exactly. You'll pay taxes on that money later. Right. So to split it, I guess. Okay. Well, I'll tell you what I do and what Dave Ramsey does. You do what you will with

this information. Dave and I both do Roth 401k only. And if Dave had traditional money, he'll roll it over every year to the Roth side so that it grows tax-free. And when he's in his retirement, if he ever retires at 90 years old, that money, it'll be like net income at that point. If you have $2 million sitting in a Roth 401k, that's $2 million you can spend without Uncle Sam getting his grubby hands on it, which I love. And you're not worried about, what are my taxes going to be

in retirement? And will tax rates go up in 30 years when I retire? I like not having to worry about any of that and just knowing that I've already paid the taxes. So your question, should you do ETFs? Should you do mutual funds, index funds? In a retirement account, depending on your options, mutual funds are a great bang for the buck. ETFs, you do mutual funds, index funds. In a retirement account, depending on your options, mutual funds are a great bang for the buck. ETFs are not bad. Those are exchange traded funds. I'm sure you know, but I'm explaining for the audience. They're investment hybrids. So it has the diversification of a mutual fund, hundreds of stocks in there, but it has the tradability of a single stock. And so there's intraday pricing. So they can be bought and sold throughout the day,

whereas a mutual fund closes at one price at the end of the day. So there's nothing wrong with them, but it can create this sort of gamified thing where you want to buy and sell, which I hope you never do. You want to hold. So for those reasons, I would probably stick to mutual funds and index funds. ETFs might have a slightly lower cost, but otherwise there's really no big difference there. Yeah. Thanks for the call. Thanks, Catherine, for the call. And congrats. I love that. I love her story. They are absolutely off and running. Great advice, George. Good hour, my friend. All right. Don't move, folks. We might be back for some of you. We might be back. Join us on the Ramsey Network app. There you go. Hey, you're still here?

What are you doing? You do know that the rest of today's show is playing right now over on the Ramsey Network app, right? All you got to do to finish the episode is search Ramsey Network in the App Store, Google Play Store, or just click the link in the show notes to download the app for free. Yep, you heard me right, for free. Then right there on the home screen, you can watch the rest of today's show. Bada bing, bada boom. All right, I'm getting out of here.

Enjoy. We'll see you on the app.