The Ramsey Show - Don't Be A Slave To The Lender

Episode Date: September 8, 2026

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I'm George Camel, joined by Dr. John Deloney. We're taking your calls at AAA 825-5-2-2-25. Patrick is in Detroit. What's going on, Patrick? Hey, guys, thanks for taking my call. Sure. So in 2012, I bought my family's home for $80,000 at about 3% interest and worked on it, put in sweat equity.

and about 10 years ago, I was, I filed bankruptcy because I was buried in student loans. And I kind of got that in order. Of course, I couldn't get rid of the student loans, but got rid of other debt and structured things. And well, after COVID, I saw that I could sell the home I was living in, which I loved, and I'm sick about right now, to pay off those loans. So I did, and I did pay off those loans, and I was debt-free, and I subsequently rented for four years. Rentals are pretty high in my area. I rented for about $2,400 a month for three to four years and wanted to get back into owning a house. So I bought a house last January for $230,000 with no money.

money down, which I'm sick about that too. I'm raising my son alone. He's going into a senior year. And I have more debt now than I've had before. I have a car loan. I have $230,000 in mortgage. I'm paying $6.25 on that mortgage. I make $100,000 a year. I'm 59 years old. And I'm looking at retirement, you know, I'm breathing down the barrel of retirement. And I have only about $150,000 in a 401k. And I'm, I'll tell you guys, I'm not, I'm not sleeping well. Yeah. Thanks for calling, man. Thanks for calling. Thanks for calling. That was a hard call to make. And I'm proud of you for doing that, man. Cool? Yeah. And we'll give you a path. How do I get out of this now? We're going to give you a path here. But,

We're not going to beat you up. We're on the same team, okay? But if we're going to do it, we've got to agree on one thing. We're not going to beat past Patrick up for his mistakes. That's right. You've got a crick in your neck from looking backwards of all the things you wish you could have done, things you should have done, regrets. Shouldn't have sold that, shouldn't have taken on that debt. So can we agree that this is a new chapter for Patrick?

59 is going to look different. Yeah. One of your homework assignments this weekend is going to be to, write 2014 Patrick a letter and let that guy go. Set him free. Okay? Yeah. And then we're going to write 65-year-old Patrick a letter about who you decided to become at age 59 so that he could have a different life.

Okay? Yeah. All right. We'll get into the math here. So you're a 59-year-old making $100 grand. Yeah. Before we get into the math, I left something out. I do have $30,000 that is in my...

bank account right now. Great. Great. You were doing better than most of America if it gives you any consolation. It's a low bar that you're doing better. So what is left on the car loan? 26. Man, sounds like you could be debt-free today.

Except for your mortgage. Well, and there's a $7,000 loan that I had to take out to get some repairs done on the house that had to be done. Okay. But that's all the debt. So you knock out the $7,000. Is that one loan, the $7,000 repairs? Yeah.

Okay. So if you knock that out, you're down to $23,000. You still owe the $26 on the car. You can knock most of the car out and keep that $1,000 start or emergency fund. What's the car payment, and what's the payment on that other loan? The other loan is about $175 a month. It's got like a $10,000 loan with $10.5% interest. It's about to be $0 a month at $0% interest.

Congratulations. Congrats. So you freed up 175 today. What about the car loan? What's the payment? It's about $550, $575 or something like that. Okay. So $575.

We're talking $750 freed up in the next couple of months if you do this. So you just got about a $9,000 a year raise of take-home pay. Got it? That leads me. Yeah. I get it, and I would love to do it, but I am scared to death. that I'll lose my job or something like that will happen and I'll have nothing and I have my son with me. Gotcha. We got you. But here's what I know. If you lost your job, which every single one of

us that can happen to us, right? You have your son with you. You're under the squat rack of fatherhood of life, of responsibility. And you know that would be a big kick in the gut and you would owe nobody anything except for your mortgage. And then the very next day you'd be at Home Depot at lows at wherever else applying for jobs. And you'd make enough money to pay your bills. And you would show your son, you'd give him a ringside seat as to what a grown man with responsibilities does when he gets kicked in the guts. Right?

You're projecting all the negative into future Patrick's life, but you're not projecting the reality into future Patrick's life, which is you're a good man and you work your butt off and you love your son and you love yourself. Right? Yeah. And so you're going to have 750 bucks on top of whatever else you have in margin, and you're going to rebuild that emergency fund right away. Are you taking home about $6,000 a month right now, $7,000 a month?

Yeah, I think so. I think that's about right. I'm in the other room, so he can't hear me, away from my budget. But, yeah, I'm taking home. Yeah, you think so. Okay, and then what are your monthly expenses? What does it take to just cover the bills? We're not living luxuriously, but we're just four walls, food, utility, shelter, transportation, insurance, debt payments. I think like five. Okay. So napkin math says you should have, if you do it right, one or two grand left over every month, and that's without freeing up the 750. Right? Yeah, you might want to up that a little bit, maybe more than five. Well, let's get it down to five. 50 would be my, I think the 750, I'd probably have about a margin of about $800, 900. But if we sat down together, we did your budget. Do you think I could find that much room if we went, hey, you could probably cut that.

We could do better here. There's two of you guys. You could clean that up. Probably. Yeah, of course you could. If your future depended on it, your retirement depended on it, could you do it? Well, yes. Good.

Because it depends on it. This is part of the letter you're writing to 65-year-old you. We stopped spending on X, Y, and Z so that my son wouldn't have to take care of me when I was 70. Right. Yeah. You are way better off than you think you are. And George nailed it. You spend so much energy beating up past Patrick that you're not giving him any chance to be successful in the present and forward moving on.

And by the way, sit down with your son. There is, I just looked it up. There's the community college guarantee, the promise there in Michigan. You might sit down and say, because of my situation, because of choices I've made, I can't afford for you to go to college. But luckily, we live in a state where community college is free. And I'm going to keep saving, work on myself, get myself completely out of debt. And I might be able to help you if you transfer to a second year to a four-year college.

Moving on, if that's what he wants to do. There's so many options for you. But it starts with you believing I can make this. work. Let me tell you what I get asked all the time. When should I get term life insurance? How much do I need? Is it affordable? Those are the right questions to be asking. So let's take a quick review. The fact is, term life isn't a baby step. So if anyone is dependent on your income, you need to have 10 to 12 times your income in life insurance. Now, and most people are surprised by how affordable term life really is. Even if you're not in perfect health. Look,

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Hey, how you guys doing? Doing well. Thanks taking my call. Absolutely. What's going on? So, me and my wife are, we've been married for about three years, been pretty diligent about saving. We've got a fully funded emergency fund and close to about, $40,000 save for a down payment.

But she's wanting to quit soon, so I'm trying to change jobs to make enough that she can quit to stay at home with our baby. And just wondering if it's, like, if it's ever advisable to just get a 30-year mortgage in order to get into the market sooner and start building equity instead of just renting. Man, I feel your pain on this one.

Because houses do be expensive. and you're like the 15 years going to be $600 more for the payment, and that's going to take this much more in a down payment to get there. So what is the house you're looking about? How much is it? I really don't know what we're in the market for. I mean, I would love to be under about a $200,000 house. Do those exist in your area?

Even if we can... They exist, but, you know, I think I'm willing to sacrifice on kind of the quality of the house and what the house has more than my wife's foods. Oh, so she wants to stay home, live on one income. I would not make that sacrifice, brother. And have the dream home. Yeah, I mean, I think she's willing to compromise on some things, just, you know, the things that make a house more expensive she really wants.

It's usually how it goes. Here's the trade you're looking to make, okay? And this is just putting all the cards on the table. You have three different pressures on you right now. one, your wife wants to stay at home with baby. That's a great thing. Okay. Number two, you all want to buy a house.

You had a picture of what your life would be. Your wife especially did of, we're going to be a small family. We're going to own a home. That's a great thing. Number three, houses are incredibly expensive and the interest rates on houses are really high right now, especially on a 30-year note. They're really high. And so you have three pressure points here.

and where I see people get themselves into crazy trouble is when they don't recognize that we have to prioritize these things and each, prioritizing each one of those things is going to come with some sort of, man, I hate to use this word because it sounds so dramatic, but it's going to come with consequences. Like, I really want to stay on with baby, and that means we're going to have to rent for two more years while we save up. We're going to, I'm going to stay in the workforce for one more year long. longer than I have to, I'm going to make one of those construction paper chains and hang it in my bedroom and I'm going to tear off one every day. But that's going to accelerate us being able to get into a house so fast so that we have the rest of our lot, right? You get what I'm saying? Like, it's when people try to do everything all at the same time and then they start moving values around.

They start moving their principles around. They find themselves just buying a brand new car because it seems easier. Just buying a kind of a lesser house than either of us want just to say we have a house. By the way, that feeling will last less than one week. And you'll go, oh no, we need to fix the kitchen, fix the kitchen, do this in the bath. Oh, there's a leak in the roof. And now you're stuck in a pretty ugly situation. So it's just recognizing we have three amazing choices, three great things that we all want in front of us. But we can't do all of them right now.

And so we have to make some choices on what we want more. Yeah, makes sense. What are you making every year? between the two of us right now we're about 75 she's the bigger half of that and I've been working for the same guy since high school and it's just not grown into what I was expecting so I'm moving jobs in the winter just to finish out the year with it's a landscape business so I'm okay because here's the thing it's not the housing market's fault right now it's an income problem there's just a math equation here if we go down to 35 40 grand in income we're not can be able to eat. This is not like a rent versus mortgage thing. So either way, we've got to get the income up if this dream is going to come true. And I hope it does. I mean, you guys are young. How old are you two? I'm 22. My wife's 23. Okay. average homeowner is now about 40 years old getting to their first home. So even if it takes all four years, you're still so far ahead, man. And by the way,

like for real, dude, like this is just two dads talking to another brand new dad. do not buy a house until you've got secure employment. Okay? Like the last thing on earth you need is to be making 40 grand or 30 grand at a job that may or may not, this or that could be. Dude, don't do that to yourself, but don't do that to your wife. Don't do that to your kid. Don't do that to the temperature in your home, man. And that means like, cool, I'm going to look for a job that I need to make 75 grand.

I might have to go get some new training. I might have to. So it's just putting the cart before the horse on a lot of stuff, man. But, dude, I can't tell you, George and I, how big of a fan, George and I are of all the things y'all are trying to do. Right? Yeah, thank you. It's just slowing down and not letting your dream become a nightmare right underneath you because you wanted to do it all right this second. Yeah.

And I will say, I'm making like 35 right now, and I have an interview next week for a job doing HVAC in which I'll start at about 40. and I've got friends at that business that are making North of 90 doing that. Fantastic. I'm going to go and make it work so that, I mean, I want my wife to stay at home. That's like priority one. And I think I just needed to hear something more concrete and that it is going to be worth it to save up and get, you know, have our feet on solid ground first. And the math isn't in your favor.

The rates are significantly higher on a 30-year to 15-year. the amount of money you would pay over that 30 years. You wouldn't stay in this house for 30 years anyway. But yeah, it's just this, it's just, dude, I get it, man. I get it, that desperation. I got to get my family a house. I got to get in the house. I got to, this kid's got to have it.

I get it, man. I get it. It's just not there for you yet. And by the way, it's important that you and your wife have the conversation about she wants to stay home. She wants to own a home. And that means you're going to be working seven days a week. There's sacrifice on either.

Right. And so she may come back and say, I actually want my husband, too. What does this look like? What does the season of our life look like where one or both of us is grinding like this? So it's just asking yourselves, what kind of life do we want? And then what's the path to get there? But I love your hustle, man.

You're a good man, dude. Yeah, when I was 23, I started this company, Justin. I was 40 grand in debt. So the fact that you guys have an emergency fund, you have 40 grand save for the down payment at this age is so incredible. Yeah, you're so far ahead. You are not behind at all. And if you buy house at 25, you will still be an incredible.

incredible human being who is crushing it financially. There's no law that says if you don't have a house by 25, you're a terrible dad and husband. I'd rather you be 27, have rented for several years, save up a big chunk of a down payment, and y'all go by the house you actually want, not the one that you have to suffer through because, like, you were so desperate to be a homeowner. Both George and I rented for a long time as married men. I had roommates all the way up until I was married. Both of my kids had lived in and rented houses and they've worked out just fine. Yeah.

So what is your rent right now? It's 1,200 a month. Okay. Now, if we go down to one-in-time... That's still going to be difficult. It's not important. It's not a bad situation, but we're actually renting from her parents. So that's another thing that I'm...

It's not a bad situation at all, but I'm definitely excited to not have that anymore. Sure. Have your in-laws be your landlord? Yeah. That's a fair wish. But if your in-laws are great, they're giving you a good deal, then come up with a plan for in one year we want to be out. Or in 18 months we want to be out. Or in six months, we want to be out.

And it is the, dude, George, the biggest pain is moving from rental to rental before you buy a house. You feel like it's a waste of time, energy, and money. Oh, gosh, it's the worst. But, man, if it sets you up, if it sets 28-year-old you up, 30-year-old you up, man, it's a pain in the butt now. but I promise you when you're 30, you're going to be glad that you slowed down and did it the right way. It's just like a slingshot.

This is a slingshot. You're pulling it back and you're like, wait, I'm going backwards. I want to go forward. They're like, hold on, bud. Hold on. We're pulling it back. We're pulling it back.

And when you release that thing with a strong down payment, she gets to stay home. You live on one income. There's no stress. Dude, you are going to skyrocket. Ahead of everyone that you know that's going, oh, I'm doing so good.

I had a house five years ago. where are they now? It might be selling that house because they did it before they were ready. We don't want that to be you, man. So do it the right way. I'm going to send you a link to our free home buying course that I did.

So hang on the line. We'll get you a link to that. And for the rest of you, we'll put a link in the description to that course for first time homebuyers completely free. Hey, what's up, guys? It's Jade Warshot.

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Are you there? Hello. So, sorry about that. I have a good question for you guys. I have, I make 120 grand a year, but I'm sitting on about 100 grand in consumer debt. To break it down, I've got $25,000. on a single car loan, gosh, $45,000 in credit cards, and $25 grand in student loans. I've also got about $5,000 left on a couch I fan at finance for my wife, Cheryl. Oh, wow. We're dragging Cheryl now into this? Man, she caught some strays out of this.

Cheryl in the couch. She's not even here, brother. Exactly. I agree. Do you get use of this couch, too? You might be sleeping on it after this call, brother. Hope it's comfortable. Yeah, I might be.

Yeah, it's definitely been a tough one for me. I'm just, I just think I'm, I'm just spending wheels here. I feel terrible about all this. Lee, what, what is $45,000 in credit cards? Let's see. I mean, is that, all my day. Don't misunderstand. What did you use that money for?

What is you, yeah, is this you trying to prop up a lifestyle that you simply can't afford? Is it? Exactly, yeah. I just, let's see, so I've got my car payment that I'm paying, which the car payments expensive as well. Now, we're asking what caused all the credit card. I'm trying to get to the root of, like, how does somebody make an 120 grand a year? And does your wife work? Yes, she does.

How much does she make? She makes about a little under than I make, probably around 110 grand. Okay, so you all make a quarter million dollars together. A little less. Okay, that's not that. A little less. Okay. And what I'm trying to get to is how do you all owe $100,000 in consumer debt,

half of which is credit card spending? Well, that's the thing. I don't know. I mean, I've tracked all these subscriptions that we have for like our, TV services and everything, and it seems like they're coming out automatically. And I don't know. It was Netflix. Yeah, Netflix is not causing 50 grand in credit card debt.

This is a guy who, this is a couple who finances a couch. Yes. This is. And our car payment. But look, we're trying to show you the math on this. You probably, you guys take home like 15 grand a month. At least. And that's not enough for you.

You went to credit cards on top of that because you couldn't afford your bills. Yes. That's the problem. Is that to get it? Is that vacations? That's what I'm trying to get to. Is there a spending addiction? Well, our house had to be remodeled.

And yes, my wife does have a small, I wouldn't say small spending addiction. Oh, gosh, let's see. Our house had to be remodeled. We had a huge water leak about all of it went to our house remodeling. Okay. That's what I was trying to get. too. It's different that our house exploded. You put house

repairs on the credit card. Versus I just have to get new clothes every week and my wife wants new furniture every other month. Those are two different things for me. Just trying to help to get to the bottom of how we can help you best, okay? Okay, yes, I understand. So is there one car payment and one that's paid off? Or do you guys

just share one car? We share one car. The car payment, she bought a car. She finances it. We are about I'm trying to break down it. We have our car payment. The loan that we have for it was 25 grand.

And now we, every week or every time we need to pay the car payment, we keep on setting it back because we aren't able to pay that. So I'm wondering if it would just be better to sell the car. I don't know. It's hard to explain. But like I'm wondering if you can't make the car payment? Why can't you make the car payment, brother? We have not enough money to pay it.

Okay. We've got bigger problems here than we can solve on a single call, but you guys need to have a come-to-Jesus conversation tonight. Go look at your paychecks that showed up in that bank statement and then go find out where the heck all that money went. Do you all share a single-checking account that both of your checks deposit into? No. Well, actually, she has her own.

I have my own, and she will not stop spending it. I'm in the other room right now. I don't want her to hear anything. Well, here's the thing. I respect that. You're a good husband who wants to protect his wife's honor. I get that. But brother, there's a, what George and I have been trying to dig at and is becoming incredibly apparent to us is you have a huge situation on your hands.

Yes. The money as you know it, as it's coming in as it's being spent, there are tens of thousands of dollars unaccounted for. and that happens and I don't want to put things out in the universe brother but that happens when somebody's struggling with addiction somebody's got having an affair somebody is just wildly out of control and so hear me say as serious as I can

and as lovingly as I can you got a huge mess on your hands and the only way forward is for you and your wife to get in a room and y'all to put everything on the table and say we are about to lose our home in our car and we make $225,000 a year. Yes, I definitely think I should have a talk with her. And, you know, I've been struggling to figure out if she's been cheating on me because she's been hanging out with one of her coworkers that she will not tell me anything about.

Yes. Your gut is, I hate to tell you, rather, your gut is probably directionally right. Okay, yeah. And it's terrible because she's the one that telling me that, I have the spending problem when she's out here buying couches and, you know, and I don't know how to deal with any of it. I need to put all this on the table, like you said. Lee, I like your idea.

Do you have a mirror nearby? A mirror? Yeah. Yes, I do. I want you to take a look in that mirror and say, it's not all my fault, but it's my responsibility. Because so far nothing in this conversation has been Lee's fault. At every turn, she financed the car and she bought the couch,

and she has her own money. I don't know what she's doing over there, but man, if she could just get her act together, we'd be doing great. I don't believe that's the case. I think you both have some serious work to do on yourselves and on your marriage. Here's what I would request at this meeting.

Both of you pull your credit reports, and you can do that for free. What's the website, George? Annualcreditreport.com. Annual credit report.com. You pull it for free, and it will show you in real time who y'all owe money to

and how much. Well, that's amazing. I'll definitely have to check it out. And what did you say? It was called annual credit report.com. Here's the next thing. When there's a whole bunch of credit cards, because brother, you don't know what she's opened in her name.

Exactly. And so I want to know as a married couple, where are we spending our money? And if there are certain credit cards, you won't, like, you can't look at that. I'm never going to tell you that. I'm not pulling my credit report. You don't need to know that.

Then you need to go sit with a, marriage counselor or you need to go see somebody and you might end up sitting with an attorney because you've got a big, big mess on your hands. Okay? Exactly. But George is right. You have to own what you do next, how you show up and treat her with kindness and dignity, even though she's not giving you that back, how you say, here's exactly what I want us to do together, give her a clear plan, here's the numbers I want to see for us. Because you all simply make way too much money to, not to be in the situation you're in. George and I talk to people all the time. who have a lot of debt and who make a lot of money.

But dude, you've got a hole in the bottom of your account somewhere that y'all are just shedding money. There's zero reason why y'all shouldn't be able to make your payments, even owe $100,000, making as much money as y'all do. Unless you all live in a $5 million house, and your payment is $7,000 a month. Is that true? No, it's about, I would say, our payment for the house is around $5,000.

Well, that's a lot. But it's still a fraction of what you guys are taking home every month? Exactly. And that's just one tiny piece. Yeah. You know what? That's a lot, but it's not out of whack. So, yeah, that's a tiny piece.

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Up next, we've got Michael in Fort Wayne, Indiana. Michael, welcome to the Ramsey Show. Hey, thanks for taking my call. Absolutely. I have a just want your opinion on something. My wife and I and our family were in Baby Step 4, 5, and 6. And then just thank you for all the principals you guys teach. It's put us here.

It's such a blessing. And we just had our youngest kid go to kindergarten, so that enabled my wife to go back to full-time teaching after being out for 11 years. Wow. amazing. So thankful for her and just all she's sacrificing to do that. Kind of our motivation as a family for her to go back was we're super close to paying off our mortgage. How close?

We're super like $42,000, I think. Nice, dude. We're almost at the finish line. That's a car loan for some people. You got this. Yeah, exactly. Exactly. So we're almost there. And so anyway, once you take out, you know, taxes and giving and then the 15% that we've done on my income, you know, it just, it makes the shovel a little smaller to get it done, you know? And so we're wondering if we can get it paid off in like 11 months or a year, what would you guys think of still doing the 15% towards retirement from my income, just like we've always done, but holding off on it on hers. until we get that house paid off.

And then after that, just bump it all up about 15% just to get it done. I'm interested to know, George and I may disagree on this, but I want to be as honest as I can here, okay? I did that exact thing. Did you? My wife and I circled up and said, hey, we're going to pause this for one year and get this thing done forever. And for our, for me who's got a psychosis about owing people money, it was the right thing. But, man, going on more than a year, going more than 18 months, it's really, and trust me, from lived experience, it's real hard to put that 15% back. Right.

Yeah. To start pulling, because, man, that feels like free money. And the discipline it takes to go back to investing, I've lived it. It's really hard, right? Yeah. What do you think? What's the principal, George? Well, I'm wondering, what does your wife make a year as a teacher now?

So she's bringing in 52, 52 a year now. And that one's got an automatic deduction, doesn't it, for a teacher retirement system of some sort? So they've got an automatic deduction. It goes towards the Indiana teacher retirement. Then they've got like a 401K on top of it. And that's what we were considering. You know, we'll do the 15% either now or after we pay the house off. How old are we?

I'm 42. She's 36. Okay, 36. So let me just do some math here. I'll pull up our investment calculator because what I like to do is go, okay, what do all the sides look like of this equation? So what you guys are saying we're going to give up is $6.50 a month for a year. So $7,800, right? So let's say that we just, we had that $7,800, and it was growing for us for the next 20 years. Now you're 62, she's still a young,

Sprightly 56, right? Right. I'm going to give it 20 years to grow. I'm going to say 10% average annual rate of return, no monthly contribution. Just that pile of money growing for 20 years, that's really what we're giving up. That's the opportunity cost we're talking about in order to pay off the mortgage a little earlier. So I'm going to calculate. It's $57,000. Yeah.

So that's the actual numbers we want to compare, not just, well, it's $6.50 a month. We're just giving that up. We're actually giving up close to $60,000 to make this happen a little bit sooner. So what I would do is say, all right, let's say that she did invest 15%. How much does that slow down the mortgage payment? When would you guys pay off the house?

So from what I'm seeing, without doing the 15, it'd be 11 or 12 months with doing it. It'd be like maybe 16. So it's not that much longer. I know it's not a huge deal. So we're talking four months apart. And then here's my other thing. And this is where my brain goes. I go, okay, how do we make up the gap?

How do we put that much extra while she invests to still pay this off an under a year? What am I willing to do? Side hustles, work harder, cut expenses, make other sacrifices, make other sacrifices. to not derail our financial plan. Because you guys have worked so hard to get here and to unplug investing for a year, just as a muscle, you're going to atrophy a little bit. Yeah, that's what I was saying. It's hard to come back, dude. Yeah.

No, I get that. I get that. Versus going from 50% to 20, 30, 40% once you guys have that mortgage paid off is going to feel easy. Oh, yeah. Yeah. Yeah, it's just like you're just adding a little more. Yeah. No, I get that.

Can she tutor over next, you know, next summer? can you do commit to doing something else? Because that's really what we're talking about is a couple of grand. Less than 10 grand is the difference here. Yeah, we can look into that or not going vacation this year or something. Well, yeah, it's the, and that's probably a good way to look at it is, if we want to accelerate this, there's going to be some pain.

Do we want that pain to be 20 years from now and we're like, man, we could have $60,000 more dollars in retirement? Do we want that pain to be, we're going to skip a vacation and we're going to go camping somewhere in Indiana instead of going on a big trip this year? What pain are we willing to endure short term so that we never have a house pain? Because we want to accelerate that thing. And you might land on it's four more months. Let's just stay the course. And hopefully also we gave you a good like ringside seat to I'm an over-emotional guy. I know that. Right. And so I'm a super nerd who's like what are the numbers? Yeah, exactly. George is like, well, future me is going to really be sad. And so

the it's just knowing man I wish I wish with all of my heart I had what George has which is the ability to feel uncomfortable and then always do the next right thing I've been practicing that for a long time I'm trying I'm coaching right he's he's trying and hopefully he wishes he had a little more fun like I do 100% so I wish I had hobbies like John does yeah yeah he wishes he had joy and laughter in his life like I do so like all that to say is I couldn't sit here and say you can't do that because I did it that's exactly what me and my wife did. And she knew she's married to a person who's quasi insane about owing people money. Like it's a lived, it melts me. And so for her, she's like, oh, I get my husband back in a year. Yes, whatever we got to do. That's like John is the little devil on your shoulder. And then I have Dave Ramsey on the other side going, you move from intensity to intentionality and baby step four through six. So that's what I'm hearing too. And I was intentionally intense. Like, dude, you're going to be 43 and 37 with a paid for house. Like that's insane. So if it's four months beyond that, we're still going to cheer you on and go, that is incredible. And the fact that you invested the

whole time is even more incredible. So that would be my personal plan would be let's invest 15% of our full household income for now and see how we can still hit our goal of knocking us out less than a year. And I almost can guarantee it. Now, I can't say it for sure. You guys will pay this house off in a year while investing. And can I... completely do a 180 of what I've been saying. I want to throw a third option on the table. What if you and your wife sat down and said, we're not going to do it in 10 months?

We're not going to do it in 14 months. We're actually going to do it in 16 months. And we're going to take a little bit of money each month. Now that you're back in the workforce full time and we still have kids, we're going to hire a house cleaner. I want to take you to a nice meal once a week. I'm going to take the kids out and let you just exhale because now you're surrounded by kids all.

day and you come home to work it like you all begin to build in what kind of life do we want to have because in the same way in your home like in my house I'm psychotic about a couple of things your wife may be feeling the weight of I'm back full time but I also feel this pressure to keep my old identity and and and and you all ask yourselves what kind of home what do you want your home to feel like and I would say even being part of like Georgia saying being intentional is we're going actually do something great. We're going to slow it down a little bit and we're going to go out to eat. Yeah. We're going to give each other a room to breathe. She deserves it. She's amazing. Just the sacrifice she makes these first couple weeks of school. It's awesome. Yeah.

And go, man, classroom is different than it was 10 years ago, brother. It's different. Amen. And so, yeah, give her the love and care and support she needs. Ask her every morning of your life. How can I love you today? And man, be all about supporting. You sound like a really. You sound like a really good husband. So we've given you pretty much no answer, right? I gave you the right one. John gave you an alternative. So I think we're both somewhere. Yeah, George gave you the right answer, and I

gave you the two alternatives. The one I did and the one I probably wish I would have done. There are no sins being committed here. But the plan works if you work it. And so we say four, five, six are done simultaneously and 15% is forever. In fact, once you pay off the mortgage, you just increase investing. But even if you had it, you're like, hey, we're good on

retirement. We still tell people to invest because there's more impact to be made for your family, for your community, for the things that you want to do. It's a good problem if you had too much money in retirement. You can come back and yell at me later, even if you paid off the mortgage four months later on. Way to go, man. Thank you. Okay, George, we hear from so many people that are trying to live out to the Ramsey plan, right? They're getting out of debt and everything. But the hard thing is there's not many banks out there that actually support the way we teach people to handle money.

Yeah, most banks, they don't want you to win with money. So they charge a bunch of nuisance fees. there's all this fine print, and worst of all, they are pushing debt products at you nonstop. Yes, but the good thing is that fair wins isn't like most banks. They're not like the other guys. They're not like the other guys. Yeah, they are not pushing debt, and they actually want you to win with the baby steps. And so what's great, too, is they created the smart bundle for Ramsey fans, which includes a high-yield savings account and no monthly fee checking.

Which is huge, because it's rare to have a checking account tied to a high-yield savings account. You can get all of that with fair wins and, for the nerds out there, you can have 10 different high-yield savings accounts for different goals. So you got your emergency fund, the car upgrade fund, the vacation fund. The world is your oyster. So beautiful. And check out the debit card, the new one. The live like no one else's debit card. It's so beautiful. We, that's a conversation starter. It's so good. Well, and when you swipe or you tap, you know, every time you take it out of your wallet, you're remembering that you are living like no one else and you're being intentional with your money. I've been using Fairwinds for

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or you can go to fairwins.org slash Ramsey today. That's right. That's fairwins.org slash Ramsey insured by the NCUA. Welcome back to the Ramsey show in the Fairwinds Credit Union Studio. I'm George Camel here with John Deloney, taking your calls at AAA 825-5-2-2-25. Thomas is in New York.

York City up next. What's going on, Thomas? Hey, how you doing? Doing great. How can John and I help? So I currently am house hacking. I'm trying to move. I don't think my current living situation because I'm in a low-income area. I feel like my two options right now is one, move out to an apartment and rent, but I would rent out my current unit or two, which I was leaning towards is just buying another property and a better area. But continuing with a house hack. So, Thomas, I'm an old, old man.

What is house hacking? John hasn't been on TikTok ever. I would not know how to log into TikTok. Yeah. What is house hacking? It's a most of my family unit. So I live in one unit and I rent out my other two units and I get rent for the mortgage. Is that what the kids call out these days?

House hacking. Yes. All right. All right. That sounds miserable. It was pretty miserable. I actually hate it. So let me ask you this.

So I was an early adopter back in 2009, 10 into this thing called biohacking. And I used to, there was no continuous glucose monitor. So I'd pricked my finger every morning. And I was always peeing on ketone strips. And I was keeping like these detailed Excel spreadsheets. And then one day I was like, I'm biohacking myself into a life that I hate living. Yeah. Right?

and so then I quit biohacking. You know what I mean? But so yeah, I don't know. George knows more about this TikTokization. What caused you to get into this house hacking situation? I'm assuming you're a guy in your 20s. How old are you? 25.

Okay. What caused me to get into it? I mean, I just want to become financially stable. But like, did someone tell you about this? Did you see a video and it sounded alluring and you started looking for multifamily homes? I think I was on YouTube a few years back Yeah, I didn't like how expensive rent was And I've always heard that it's better to buy them to rent

So, figuring out how I can buy Okay What I want you to understand is that a lot of times The things that seem really cool on the internet Are often going to destroy your life Now you're not quite there yet But you're getting a little bit of that taste in your mouth Of the reality of this was not what was sold to me

when I bought the course or whatever. And so I want you to realize that it's okay to opt out and go, you know what, I'm going to go rent for a while and just sort of reset. I can sell this multifamily because I don't really want to be a landlord by default just because I thought house hacking was going to be the move. And both George and I have both rented, both married. I've rented, both my kids have lived in rented homes at certain times. And we kept plugging away. and our life is changed now. You get what I'm saying?

Like the fact that you're thinking about future you and you're trying these things tells me you've got what it takes to become financially secure. You're not scared of doing hard stuff. You're not scared of putting yourself in uncomfortable situations. You're not scared of like doing the next right hard thing.

So, man, all you need is a clear path. It's actually going to get you where you want to go and not get a bunch of clicks on some social media. site, right? Yeah. So what are you making right now? What's your income and what is the income you're actually netting from this multifamily, if any? My income, like gross is 300.

What do you do? Software engineer. Amazing. 300,000? Yeah. You know who doesn't need to house hack guys who make $300,000? Thomas, you won, dude. You can pay your own mortgage like a grown adult.

need people doing it for you that live next door that also knock on your door when their toilet breaks that throw parties i mean i'm trying to like you know put myself in the best position thomas you're in it do you have any debt right now um no like 4 000 student loans okay you can pay that off today you have that money in savings yeah i can today how much will you have left in savings after that a good amount like uh all At 90. Amazing. So think about this.

Today, you will be consumer debt-free with $90,000 in the bank. What is owed on the mortgage on this multifamily? I just bought it, like, 18 months ago. I almost about all of it left, like $6.50. $6.50 is what is owed, and it's about worth $6.50? I bought it at, like, $6.90 right now. If I have to guess, between $7.50, maybe a little more. So you could probably walk away after $6.

fees with a little bit of pocket change if you sold it. Maybe. Maybe. Okay. Because right now they're just paying the mortgage. Like basically you're staying there with rent-free? Yeah. What's the cash flow like?

Because you have a big old mortgage on that. Yeah. I mean, I'm like negative 100 after rent is collected. So you owe 100? Like after I get more my rent, I have to put like $100. Of your own money. Okay. So you basically have a very low rent.

right now, but you have to do work as a landlord and deal with all the risk and liability and all that fun stuff. Yeah. And somebody else regularly flushing your toilets. Yeah. Right. So what is your actual dream? If I could erase this whole house hacking thing, we restarted today, what does Thomas really

want? Do you want to live in a single family home in a decent neighborhood and start a family? What's on the other end of this? Yeah. A nice single family home and a nice neighborhood. So buy that. Set yourself up for the life you actually want. What was growing up, like what was money like growing up for you? Money wasn't, I wasn't fun.

But yeah, money wasn't there. I wasn't broke. We weren't broke. You know, money wasn't. Was it a source of tension? Yeah. I mean, we didn't, my mother did a good job, so we didn't feel it as children. No, no, I'm not saying this as a character in anything, any shade on anybody. I'm just trying to get to a, like, because where George and I are sitting, you're 25 years old, you make 300 grand. Yeah. When you're 27, you'll have banked $900,000 after taxes.

You get what I'm saying? Like, bro, you're doing really, really well. Now you're in the uncomfortable adult seat of slow and steady. So imagine you go rent for a year, even if it costs you, I don't know, two or three grand. I don't know what it's going to cost in your area for a place that you like. And you just live fairly frugly, live on less than you make, should be easy on 300 grand with no debt. You bank 150 grand on top of your 90. Now you've got some serious money.

You've got 240,000 to put down on a house that you actually want. You're saying I should like just buy this nice single family home in my neighborhood. buy the home that you want because you don't need somebody to pay your mortgage that's not the issue if you if you buy the house you want and you start building the life you want

and a few years from now you want to get into real estate that's awesome man you'll be able to do that with cash buy the place yeah and then put two different families on either side of each other give them a great deal on rent to support them and man everybody wins

you have a girlfriend right now even if I'm not yeah I do Okay. What does she want for your future together? Oh, yeah. Nice to go to family home. She wants that duplex life. I think you know what to do, man. And you were in a great position to do it. But it all takes is putting this house on the market and going, well, tried that. Wasn't for me.

Wasn't for me. That's okay to say out loud. You should get into radio because your voice is way better than mine. So smooth. Golly, I would love to have a voice like that. This show is sponsored by BetterHelp. A lot of you are just trying to keep it together all the time. You show up to work, you pay the bills mostly on time, you smile at all the right times, but no one sees you when you're exhausted.

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James, welcome to the show. What's going on, guys? How are y'all? We're doing great. How can we help today? Awesome. Hey, let me just start by saying I'm a little bit relieved and a little bit disappointed that I'm not talking to Dave today because I knew Dave was going to look my tail.

We can do it. leave that I'm not all the phone. We'll dial it up for you, man. We've gotten our tail whip by Dave, too, so we know. Look, John, I listen to you all the time, bro. I'm a pastor, and I sit with a lot of hurting people. And, man, I'm going to a lot of even, I don't want to say tactics, but techniques is how to fit with people from you.

So I appreciate you, bro. You got it, man. Thanks for calling. How can we help, man? Yeah. So my wife and I have been married 14 years. My wife is amazing. We have six kiddos, 10 down to one.

I am a pastor of a growing church, and I also run a small business. And it's kind of in a spot. We've allowed our stuff to get kind of back into a spot where we've got a good bit of debt. And we have an income issue, but at the same time, I also have just a time issue. So anyway, we're trying to get started back on the baby steps and get out of the job. debt. And so it's just in looking for maybe a little bit of help with us as we're trying to get started and such. What kind of debt is this? And how much?

Yeah, so we've got about 70,000 consumer debt. It's about 30K and a personal loan. Two grand we owe to the local county. We're paying on taxes for our land. we have about 5 grand over two different credit cards and then 16,000 in a truck I bought last year when I was starting the business and then also 8,000 for an enclosed trailer I bought as well for the business What's a small business?

Yeah, so I do light remodeling handyman that kind of stuff What did you report last year? How much did you make? About 65. Yeah, about 65. And it was about half the year. I was doing it full-time, the other half the year. Really, not even another half. In November, I actually stepped. So really about 10 months of the year, I was doing it full-time. In November, I stepped in as a lead pastor to church, and so I cut back to about two or three days a week with the business. I'm honestly not sure right now if it's worth it.

What is your salary as a minister? 60,000. Okay. So you were making $125,000. Are you making a grand a month doing this now? With a side business? Yeah. It depends, honestly, Feastor Famine.

June, July was maybe a grand. August will be about $7,000. Because you're, yeah, on the months that are bad, you're bleeding money from this thing just trying to make payments on the truck and trailer. And was the 30K personal loan for the business? No, that was, we moved about two years ago and purchased a piece of land and put a What was the land for? And just where we live, we sold our house and just lifestyle.

We moved out of the city, moved out into the country to raise the kids that way. Okay. Yeah, so we ended up, we thought we could cash flow it off the sale of our other house. And it just, once we got in it, we couldn't. So we ended up getting a personal loan to finish drilling the well and that kind of stuff. Does your wife want out of this debt? Are you guys ready to go back to debt freedom? Like how bought in are you guys?

Yeah, yeah. No, we're locked in. We're together. We're locked in, bro. Like, I posted my truck yesterday. Wow. Well, here's the other. Now, I don't know.

Here's the other side of it. Well, here's the other side of it is you all sit. I mean, you can't get through this without sacrifice, gnarly sacrifice. Right. It seems to me, and it push back on me, man, and George, you tell me if I'm wrong, you happen to have a key in your back pocket, which is I can go turn a key and I will collapse at the end of one calendar year, but I can make another $65,000 on top of being a pastor here and get my family cleared out of this mess. Potentially. I think this is where I'm struggling. I've got the church in the last year has doubled. the Lord's doing it's the cool work and it's doubled and you know in the last nine months I've done five

funerals and walked with folks after they're become widows because the spouse committed suicide and sure sure sure so you're saying that the church is demanding more time from you now so you don't have time for the business which is producing the income that you need to pay off the debt is that we're getting that right and I have six kids so so here this is my kids are my first ministry So that's my wrestling with all of that. Well, this is one of my, like, top of the top five hard conversations I have to have, this is one of the hardest, okay? This is up there in the top five. You want to be a pastor.

You might even use the language you are called to be a pastor. And by all accounts, like all, what I would call and a hate-hate-hays using these, but by earthly metrics, you're pretty good at it. You're creating a world that people want to be a part of. You're not creating it. You're help facilitating a world, right? You're good at it. And you and your wife dug a $70,000 hole. Yep.

And so at some point, you're going to either have to pause this dream and this calling because to clean up decisions that past you has made or you're going to have to look at your wife and say, I've got six kids and this is my priority. And I'm going to show, give them a ringside seat. I'm going to show them what it's like to clean up a mess you've made. And like I say, you will be spent. You will be a wrung out rag at the end of a year.

Or you get with your church leaders and say, here's the situation I've found myself in. Right? But, like, I hate that you're in this position, but you've got a math problem in front of you. You get what I'm saying? Yeah, yeah, for sure. And one million percent, like, we put ourselves in this position. I mean, we're there. Oh, I hear you.

I hear you. You've taken full responsibility. So that's why we're not going to beat up. on you and Dave wouldn't either because you're not a guy who's not seeing it for what it is. You know what you did. You know the way out and you're going, how do we do this? And we're giving you the roadmap. It's just not a fun one to say, hey man, you got six kids and you're going to miss out on some things over the next year as you clean this up. But the other side of this is you do nothing. You go into deeper debt. Now you got kids who are two through 11 and you've got a

bigger pile of debt. And so kicking the can down the road is also not going to solve it. So the best way to get out of this debt is just go through it and go, all right, if I can make 70 grand doing this side business plus our income, we can knock out this debt in 12 months. Yeah. Yeah. And I mean, there's more work. Works definitely not the issue. I mean, I can. Sure.

You can drum up more work out there. Or you and your wife say, hey, this is a two-year project. And I'm going to make $30,000 a year. And every penny in the side business is going to go towards our debt. Every penny, which means we got a $1. learn to live off my $60,000 ministry income. Yeah, well, and something we did last year, or this year, which I'm, was the right decision, but just kind of added a complication is during COVID, because I've been in ministry

for a while, but it was kind of an associate pastor, but during COVID, we got food stamps, which, you know, of course, I would never want to be on or even tell anybody I was on, but we were. And so, man, with as many kids as we have, we were getting 900 books a month. And we killed that this year. We're like, we're done. I've started the business now. We no longer eligible, and we're doing, yeah, we're going to turn everything in. We're walking on the up and up, and we're going to sacrifice that.

So I also got like a $10,000 pay cut in some sense this year from... Because you're covering that now. But, bro, yeah, and it was worth it. My wife and I talk about it all the time. I'm like, praise God, we are not. Well, now you're in control. Can I have permission to Jesus chook you, James? Jesus chute you.

Okay, here it is. Proverbs 22-7. You know about 1,000 more verses than I do. The borrower is slave to the lender. And you knew that, but now it's a stark reminder that that lender owns your time that you could have been spending with your kids. So it's not the side jobs fault. It's not the church's fault. It is, man, I'm so mad at the decisions I made and the lenders I have to pay.

And I'm going to get out once and for all. never go back in, which means cutting up the cards, selling the trucks, selling the trailer, and working your tail off to climb out of this thing for true freedom. We're rooting for you. As your business grows, everything becomes more complex. There was a time when Ramsey Solutions had too many disconnected systems and not enough visibility across the business. We wasted too much time chasing information instead of making decisions. That's why we got NetSuite. NetSuite brings your financials, inventory, CRM, and more together in one place. More than 44,000 businesses run on NetSuite, including Ramsey.

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If you're sick and tired of working so hard and having nothing to show for it, that is normal. And normal is broke, sadly. You don't have to live that way. Our every dollar budgeting app helps you find extra money every month and builds you a personalized plan to beat debt and build wealth. And in just 15 minutes, you'll find thousands in hidden margin and you'll feel like you've got to raise. So don't live normal, live like no one else. Start every dollar for free in the app store or Google Play. Sarah is in D.C. up next.

Sarah, welcome to the show. Hey, thanks for having me, guys. Absolutely. How can John and I help? So I have a timeline question. for you all today. So I am fairly newly engaged and my fiance and I are, you know, sitting down to the numbers and we're keeping things separate for now but planning on combining.

So just kind of planning for all of that. And we are currently in a small rental apartment and want to know about saving for a wedding and a down payment for a house with kind of a few little asterisk to, the grand scheme of things. So one of the major sacrifices that we've made to try to pay off all of our debt is staying in a fairly small apartment that's not super conducive to raising children in. My fiancé is in the police department. So we actually live in a not so great area that I wouldn't feel comfortable bringing a small child into the home. but in return for his presence as a police officer

and what he does on the side for them, we don't pay rent. So obviously that is a huge blessing and has allowed us to pay down our debt, but I don't want to have children here. I'm about to be 31, and so we would like to start on children shortly after getting married.

Once the wedding? Yeah, that's... So we haven't set a date yet. Part of doing that is setting out our financial goals because we, like I said, paving up for the wedding is sort of part of this timeline question. Okay. And how much debt do you guys have left separately? So he is almost done.

He has about 3,000 left in student loan. That's it. Paid off the credit card, paid off the car. Awesome. So he's set. He'll have that done in like a month or two. Great. I have 11,000 in my car loan, and then I have 214 left in my student loans, which sounds scary,

but I started it over 300,000 total, so I've made a lot of progress. Are you a physician? I am an overnight emergency veterinarian, so kind of the second caveat to that is the longevity of my job. You know, I love what I do, and I wish I could do it for forever, but my body tells me that I cannot do overnight for forever, especially in emergency. And I'm worried about probably needing to take a pay cut when we start having kids. I could work as a regular veterinarian and probably still make 160 to 180 in this area, but it would be a substantial pay cut, obviously. So I'll let George speak. I have some ideas, but we'll wait.

So the overall question you're asking is, when do we make the move, where do we go, should we rent, should we buy? So I would love to buy, that's the preference, but yes, if you have thoughts on that, would be great. My question is when to stop aggressively paying down the debt, which I mean I'm putting like close to $8,000 every month into my student loan right now. So when do I divert from baby step two to try to do the things that are needed for the next steps of our life without putting it up too much on hold? Next steps being wedding, down payment, all that? Yeah.

Okay. Well, I'll give you the simplest answer, which is you are not going to stop being aggressive on the debt, but you should pause and save up for the wedding and do something reasonable. Now, is it just on you two to cover all things wedding or is family helping? It's probably just on us. Okay. Then I'm going to do the smallest sweeting. It's just called an intimate wedding. It's cozy.

You don't need 150 people there because you're basically paying for them to party at 100 bucks ahead. Yeah. Let me talk about that. We're planning on doing something small and reasonable. Okay. And the reason I'm not like, you've got to get married tomorrow. It's just that once you guys are married, you're going to have a superpower, which is combining your finances and your goal and your vision, which is going to move everything faster.

because if you had all of his income, now he's debt-free, throwing at your debt, well, now we can make some progress fast. It's not going to take you as long. You're going to get done in less than half the time. And so that's where the focus should be, which means we are renting for the foreseeable future until we are completely consumer debt-free. We have an emergency fund. We have a solid down payment. Because what happens for people in your shoes, you guys make great money. You have the baby, and all of a sudden you want to cut back and you can't because you have a huge pile of, of debt, you have a huge mortgage, you have nothing in savings, and now you're frustrated. Yeah. And you're scared.

And so I'd much rather you do this with peace and just rent for a while with your incredible incomes, even if it's for three or four years. That's okay. I guess does that, I'm nervous and very hesitant to put off our family planning and children. Oh, I'm not saying that. Listen, I'm telling you to have a baby. And when that time comes, you guys should move.

and go rent somewhere even if it costs you money. Or every single apartment or a condo I've ever rented had some police presence. Is there a possibility that there's nicer apartments, nicer places somewhere within a 30 or 45-minute radius where you all both work, that that would be a possibility? So probably not like, I mean, yes, we could move and like rent somewhere different. Like that's definitely obviously a thing, but not in the same setup where we're, we would not pay rent. Or a subsidized rent?

So they do exist. It's a program like through the department. Okay. But the way we got this one and it was essentially like handed down to us from his best friend. So what would rent cost if you didn't have any subsidies? If you just had to pay for rent, some more reasonable, a nicer place, what would it cost? Probably like 2,500 to 3 grand. We live in a pretty terrible housing area.

The housing market is awful. And if you guys are married at that point, you guys are bringing home, my guess is maybe 12 to 15 grand? So our take home combined is about $16,000 a month. Amazing. So think about that. $2,500 out of 16, that's not the thing that's going to hold you back from paying off debt. And you have a higher quality of life, which means when you come back from a long day at work, you can rest your head somewhere. feel good about it and sleep better.

Yeah. Yeah. I know this, it feels like I'm climbing a mountain or sleeping under it currently. Well, can I, can I say some hard things because I love you and I want you and your husband to have an amazing life and have 50 kids and have everything you want? Is that cool? Yeah, of course. It would be really advantageous to you.

And it's a, it's a psychological exercise as much as it's a spiritual exercise. write down all of the things, not need, all of the things you want. And what you're going to find is you want a whole bunch of things. And everything you've said so far you wanted, you want a nice house, you want a safe place for your kid, you want to have kids right away, you want to get married. All those things are amazing. They're all awesome. I support each one of those a million percent. But you also wanted to take out 300 grand to go to school.

Yeah. And so that particular want that you gave into is now holding you back from all these new things that you want. And so let's sever ties with that old want as fast as humanly possible so we can get to the life that we want now. But trying to cram the things that you want now into an already existing mess will make everything less peaceful, enjoyable life giving. And what ends up happening is we want to blame everybody else. You looking in the mirror and saying, I thought I had to. Nobody told me different. Whatever. I took out $300,000. So I'm going to live like a maniac getting this stuff paid off. I'm going to get married and have a really small wedding because I don't want to spend 20 grand on that. I want to spend 20 grand on two more months of

paying off my student loans. We'll have a different party in two or three years. But we are going to attack this thing so we can get into the life that we actually want. Hey guys, it's Rachel Cruz. If you're working the baby steps, every major expense deserves a second look. And health care is one of the biggest expenses in most families' budgets. And that is why I recommend that you check out Christian healthcare ministries. CHM isn't insurance. It's a health-cost sharing ministry. That means members help pay one another's medical bills. And they've been serving Christians since 1981. CHM programs start at just $115 a month. And here's why that matters. If you are paying more than you need to for health care, that money could be going toward paying off debt, building your emergency fund, or reaching your next financial goal. And your monthly cost isn't based on your medical history or where you live. Y'all, a lot of families find CHM gives them more room in the budget. That's why so many members say they're better with CHM. And right now, new members can receive a 50% credit

towards their first month of membership. Go to CHministries.org slash budget and use promo code Ramsey. That's CHMistries.org slash budget and promo code Ramsey. Today's question of the day is brought to you by YREFI. If you've fallen behind on your private student loans, you don't need more shame. You need a plan. YREFI helps borrowers explore refinancing options with a low fixed rate and payments based on what you can afford.

Go to yrefi.com slash Ramsey. May not be available in all states. Today's question comes from Antonio in Florida. Antonio writes, My wife and I have been on separate pages regarding credit cards. She uses them to play the points in Miles game, but I'd like to get rid of them. She's recently started realizing how much work it is

to manage all the things that come with the credit cards and also wants to get rid of them, but is worried about destroying her credit score. Is that something we should be concerned about? No. Thanks for the question, Antonio. that was fine. See, here's the thing.

I don't think our answer is going to be satisfactory because it needs to be a lived experience. Us just telling her you're going to be fine, probably won't be enough. And I wrote about this extensively in my book, Breaking Free from Broke, a whole chapter on credit cards, a whole chapter about what I call the perfect spender,

the points for Redeemer, the people who are like, I'm playing the game perfectly, why would I stop? And now, not only that, but why would I stop when it could then hurt me to stop because of my credit score. So what you need to remind her is that a credit score allows you to get more debt at good terms.

So what else are you trying to go into debt towards and how does a credit card actually help you move forward financially? And once you realize that it is a game, that it is a maze. And at the end, you're like, where's the cheese? And like, oh, no, there's no cheese. They expired. You just keep, there's another maze now. You just keep doing this until you die.

And so I'm glad that you're realizing that this is a game and that she's realized. hopefully that this is a game and it's just this was fun but you're saying she wants to get rid of them so here's the thing you just get rid of them your credit score might take a temporary dip and then you move on with your life and you pay cash for things using your own money and that is where you get so much freedom that you can't i can't explain to someone how good it feels to not use someone else's money um well let me let me because i was going to say um Antonio your wife's right it will destroy her credit score it go to zero. It'll implode it. I would say it doesn't matter. But you're saying it just a little dip. Yeah, I mean, if you immediately like, you pay it all off and close the account, you'll see

a dip in the credit score. Now, the question is, it's not going to be like that forever. Six to 12 months after you have no accounts open, it becomes indeterminable. So if I went to check my credit score right now, it would just say, ain't nothing here, bud. We don't got any records of you. Right. I'm off the grid, basically. That's like me looking up like, what is my score on like a dating website. I'm not on them. That's it. So the only major thing people get worried about that is legitimate is, well, how am I going to get a house? And there's something called manual underwriting. We've talked about it a lot on the show. And it's like the old times before, you know, the late 90s when credit scores were all the rage, you just went into the bank or the lender and said, hey, here's my

income. I don't have any debt. Here's my down payment. Here's my rent, you know, payments that were on time. My utility bills have been on time. And you can get a mortgage without having a credit score. And again, it's not theory. I've done it. And so. I've done it too. And before every human became commoditized and reduced to three digits a number right that some computer spit out and said this is this is your risk profile to us as a big um entity yeah man man you and you're running they actually look at you and your actual situation um and Antonio that I'll tell you the two things that were convicting to me about credit scores um thing number one is it has zero nada no bearing on your financial position meaning I

could give you, I don't have this, but if I found it and I gave you five million dollars, it would affect your credit score in zero ways. And so we've suddenly over time, this extrinsic metric called a credit score, we've allowed it to infiltrate not only our borrowing and lending world, but our self-worth as some sort of proxy for how are we doing financially. I hear so many of my friends and even family members say, well, I want to keep my credit score because it's this. And they never say, here's how much money I have in the bank. Or here's my net worth even, financial net worth. They just want to keep this credit score up.

It's not a proxy for how well you're doing financially at all. It's simply a proxy for how much have you borrowed it in the past and how good did you manage that relationship. That's it. The second thing is, and this is me getting all high and mighty. and George, you and I've talked about this just privately. I, man, I was big on having a credit card, using it for the free points. I travel a lot and I didn't want to pay for flights and I would pay it off every month. And I lived like that for a long time.

I remember the aha moment when I got a bunch of points for a huge purchase that I got reimbursed for that I thought, wait a minute, they're not my friend. They're not just hooking me up. They're not a charity. Who's paying for these flights? And as I dug into that, that's when I said, I'm out of this game. Because the people who pay for that flight are the folks who are struggling to pay their bills every month, who are paying overdraft fees. That's what's funding my free hotel rooms and flights.

And I don't want to get a free flight on the back of somebody who's struggling like that. So I'm out. I'm out. If I want to go somewhere, I'm going to pay for it. And if the airline I use or the hotel I use, they have their own point system. Like if you use my airline system, my airline will give you free flights over time. Great. That's between me and them. But somebody who's struggling isn't funding my good times. I just don't want any part of that kind of gross system. I got the numbers for you here, John. This is in the book,

in this chapter on credit scores and credit cards, lower income card holders paid 4.14 billion in fees just that year. Those with higher incomes raked in 1.26 billion in rewards. That's pretty wild. So lower income people are paying $4 billion in fees, and the rich do get richer because they're raking in those rewards. The credit card company is not blessing you. They're just simply redistributing that money. Right. And so in my head, there's a single mom who his husband just or whoever, the guy just walked out and she's got to get groceries and she puts them on there. And that same month, her hours get cut. And they charge her $35, $75 late fee. That's what just bought my flight. I'm not. No way, dude. Right? No way. I don't want to be a part of a system like that. going to opt out. Man, well, I'm riled up now. So Antonio, cut them up, cut them up and move on your life. Bella is in Sacramento up next. What's going on, Bella? How can we help?

Hi, guys. I am so excited to talk to you guys. I've listened. You guys are like celebrities in our house. Wow. You don't get out much. We're not celebrities in our own house or on the internet, so thank you so much. I never thought I would be calling about my dad. So my dad, who's always been very meticulous with money, like his checkbook, but he's old school. So he does, you know, have a credit card with points. He has multiple credit cards. And now we're in the position of having to make decisions for him because he's starting to suffer from dementia.

Wow. So, so. And so, yeah, he's had this serious card for, I don't know how many years, racked up, like, six figures of reward points. And I guess, Recently, Citibank bought out Sears, and so when they began sending him statements, he didn't see his reward points that held so much value to him. Now, he's suffering from dementia, so he doesn't understand now that it's not money, it's reward points. And so he's thinking Citibank stole like

$120,000 from him, which I'm like that. You can't even have that much on a credit card. How much does he owe on this card? So now he owes about $4,000. I tried to talk to them. He stopped paying it because he thought they were stealing his money. Oh, no. I tried to talk to them and tell them, hey, we're trying to figure out a way to help resolve this. He doesn't have an income any longer. They're just not moving. And so now they just served him with a summons for court, which doesn't have a court date on it. So I don't know if they're threatening him. But I just don't know as a daughter, like what options I have to help him out of the situation. I've never been here before. I'm guessing you don't have financial power of attorney. Yeah. Not yet. We're all in the

process. Like now that we're starting to really obviously see that our dad who we've looked at, you know, look up to was like suffering from dementia. We're like, oh, wow, we need to start getting things in place. Yeah, get financial power of attorney as soon as possible, okay. Okay. And you can try to settle with them explaining the situation. And I don't know how much the courts care about his health. The credit card companies just want their money. He's just an account number to them. And so you're going to have to fight this and explain what's going on. You could settle. You could just let it go and they try to sue him and the debt stays on and whatever at that point. Or you can go to court with your father who's got dementia and say, here's who they're beating up on,

judge. I don't know what that would get you. Or if you look and say, hey, he actually owes you $3,000. You and your brothers are going to come up with that money and help clear that debt because he did take that money from them. We're going to clear it. We're going to close this account. That might be the path forward to. And I would contact our friends at Guardian Litigation. You can go to guardianlit.com slash Ramsey. They help with exact situations like this. Good luck, Bella. As a frugal guy, I am always looking for entertainment that is worth what I pay for it. And that's not always easy. But Angel's newest movie definitely passes the test. It's called Runner. And it might be Angel's most action-packed movie yet. It's a buddy comedy about a former soldier

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because the value is impossible to argue with, night after night of entertainment that is totally worth it. To become a premium member of the Angel Guild today and get your free tickets to see Runner opening September 11th, just click the link in the description or go to angel.com slash Ramsey. That's angel.com slash Ramsey. Limited time offer, visit angel.com slash Ramsey for details. Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. I'm George Camel here with John Deloney, taking your calls at AAA 825-5-2-2-25. Dan is in Minneapolis up next.

Dan, welcome to the show. Thanks for having me. Absolutely. What's going on with you? Struggling a little bit here. Talk us through it. So currently, I have a newborn baby, 10 months old. my wife just found out she's losing her job

and I just started a new business perfect storm yes was there severance with her job what happened um so she actually is an online telehealth nurse um and they had a meeting one day with 200 employees on the zoom call uh the CEO of the company hopped on and said hey if you're on the zoom call you're all going to be losing your job. And if you have any questions, take it up with HR and hung up the phone call.

Wow. What a coward. I hate that for her. And then after that, I guess they had a employee group chat or whatever, everybody was on there talking. And three minutes after the call, they shut down the group chat for them all to talk to each other. And what do you do for work? So I actually, I just started a concrete and asphalt paving business. Is that full time or do you have a different job while you have the side business up and running?

Yep, I do have my full-time job as well that I do like heavy equipment to operating. All right, I'm going to cross my fingers here. Please tell me as you started this new business, you didn't go also leverage a big truck and a dump truck also and a front loader as well. No, luckily, you know, I just started listening to you guys a little bit of background about me. I grew up on a Native American reservation as a kid. My first memories, my dad was abusing my mom. Grew up learning everything from my mom after they got divorced. And then when I joined the military, she was end up actually stealing money from me while growing up.

So then I kind of ran off, did my life, lived lavishly, enjoyed our time and stuff like that. Well, after her and I got married, my wife and I, I should say got married, I found you guys on YouTube. started watching the smart money happy hour and the John Deloney show. Yes. Became big fans of you guys. So then when I started my company this summer, I told my wife, I said, I'm just going to cash flow the business. Awesome. So as of right now, my business has no debt, but we still have consumer and personal debt.

Dude, I know that's a tough season you're in, but you didn't make it worse. So I'm proud of you for that, man. Like, I have my fingers crossed because almost everybody in your situation does the opposite. it's so well done for literally just this moment, right? Yes. Just this moment. Awesome, dude. Awesome.

So how much are you bringing in from your full-time job in the side business right now every month? So my full-time job every month, well, I make about $100,000 is what I actually pulled in on taxes last year. That was before the new job. And I'm just kind of getting the balls rolling, getting some jobs coming in. And for September here, it's looking like the concrete side job is going to be bringing in. probably about $12 to $20,000 of profit. That's fantastic. How reliable is that?

Can you consistently make a certain amount every month doing this? In Minnesota, pretty much just the summertime. So I have to maybe some jobs in October, and then after it freezes up, I'm pretty much on standby until next spring. So we've got two more months to really hustle. Yes. Okay. And they tell us you got 10-month-old, right?

Yes. Okay. I guess nothing is good about what happened to your wife. The complete lack of humanity her employer showed, the way that was done, all of that, cutting off her human connection with her colleagues, like, all of that was disgusting and gross at every level, right? And there's going to be a season of grief for that. Your wife and you are going to be right to be like skeptical of trusting businesses and

in Boston, all that's right. And I'm trying to look for some light here. Your wife has right now, what I would say is one of the hottest credentials, which is a nursing degree. Right. Yep. And so what does it look like for y'all to sit down and say, how much debt do we have? We didn't want to put, we, she had a work from home job, which was awesome. So your picture is going to change. But for one year, if we put our daughter and we get some child care, could your wife go work? full-time and get all these debts paid off so that y'all can then go about living on your hundred grand plus whatever else you bring in yeah that's a possibility um i've been working hard every we got married in 2024 and starting in 2020 for her and i combined together we had

$213,000 a debt and that's no home that was just a camper we lived on the road while she was a travel nurse, my pickup truck, toys, and her student loans. Over the last two years, we've been buckling down trying to pay it off, and we're at $143, $143,000 in debt right now. Okay. What's left? I'm selling, go ahead. What's left on the debts? What's left is the, we have three credit cards, a car, or two cars technically, and then my truck

and camper. Okay, do we still need the truck and camper at this point? Are you using the truck for the business? No, you guys might like this. I actually just shook hands with the guy and I'm selling the truck and camper tonight when I get off the phone here. Oh, boy. You buried the lead, man.

Yeah, so, I mean, I'll be about 10,000 upside down on it, but we can attack that pretty quickly, I feel like. So that will leave us after that sale, I think we'll be about 67,000 left in debt. Dude. That's great. What are the cars worth? God, you're awesome, man. Could you continue this with the car?

Like, just do the snowball of selling all the things with wheels and motors in your life? Yeah, so with that deal, actually, I got a work truck for my company. I'm actually going from a $40,000 truck down to a $2,500 truck with rust on it. But it's like, I'll make more money that way. As it should be. And then my wife's car, we traded her. She had a 2024 car. We just traded in for a 2018 to make it more affordable.

so she can get around as well. Okay, so look, brother, like, if you go down to $60,000 in debt, that's literally her work. That's take home for her if she goes all in for one year plus child care. Yep. And if you all make, if she doesn't want to do that, you don't want that. That little baby, right, is 10 months old, for God's sakes. Doesn't know what day it is, right? Like, dude, if you all, if you all shake hands on one year of hell, one year of it not looking like you thought it was going to look,

you are free forever. Yeah. You'll do the business because you want to, not because you have to. Your wife could stay home if she wants to. Or she can keep working full-time as a nurse because she loves it. And y'all get on with it, man. But you're talking one year of sacrifice. One year left, dude, and you're free.

I feel great. You're free. And I got to tell you, Dan, I got to tell you, you grew up in Black Hole Hell. right? Yep. And you as a man have turned and faced that hell and your kids, I'm getting goosebumps, your grandkids are not going to know what that's like because you turned and stared it down.

It's an absolute honor to talk to men and your wife is involved in this. Men and women who are saying this trauma ends with me. And from now on, my family is going to be free. Hey, George Camel here. So you're thinking about buying or selling your home. It's exciting, but there's a lot to think about, and all those decisions can feel overwhelming. Well, here's the good news. You don't have to tackle the process alone. Ramsey's Real Estate Home Base is the place to find all of your free tools and resources for help to get prepared to buy or sell your home with confidence.

You'll find calculators, start to finish guides, a podcast, and even an in-depth video course hosted by yours truly. What's not to love? So if you're ready to take the next steps toward your home goals, go to Ramsey Solutions.com slash real estate. That's ramesysolutions.com slash real estate. Welcome back to the Ramsey show. I'm George here with Dr. John, taking your questions at AAA 825-5-2-2-2-5. Ron is in Denver up next. Ron, welcome to the show.

Hello, Dr. John Deloney and George, how are you doing today? We're good. Ron, how are you, man? I'm doing great. Thank you so much. I just wanted to give you a shout out with Dr. John, because without your advice and with them, I would have never moved with my wife because she is out of my league. So thank you. Wow.

John gave you the confidence? Well, I'm so far out of my league, dude, that welcome to the club. It's awesome. Thank you. Thank you. Thank you. That's so much of your time. You bet you.

I was just getting straight into my question. So she wanted to do a little debate between my wife and I, see who, I guess, which way we should go. So I'm 30. She's 32. And we have a condo that we're about to sell. Should be netting around 160. to 170. Our only debt is about 34,000 on a 401k loan and everything else is paid. And then we have on our home as well, we bought it last year. We have a three to one buy down, rate to buy down.

And it returns back up to 6% in about two years. And so what she's, we can comfortably afford the payment today. But my wife worries about what happens if we lose our job. Her family lost their home a wall back due to debt. So it is a real fear for her. And I totally understand that. And so what I want to do with it is build a basement, but she wants to recast the home. So we're just a little, yeah. So just to make sure I'm on the same page, you'll have a home and you have a condo and you're selling the condo? Correct. Yep. Okay. And you're going to net 160 and you're going to immediately pay off this 401k loan. So you'll have about 125 left, right? Yes. Okay. And so how much is your mortgage on your current home?

Right now with the buy down, it's about 3,500 with HOA. And it's going to go up a percent every year, so that payment will increase? Correct. So at the very end, at 6 percent, it should be around 4,500. Oof. How much do you owe on your current home? Around 580, and then it's worth around 750. Okay. And what's your household income? Did I miss that? Yeah, so right now our base salary is around 3.30. And then with bonuses, we're around 4-50-ish depending on performances.

Incredible income. Okay. So what's the ultimate goal here? Like when you guys sit down, like a year from now, where do you guys want to be? What does your life look like? We deaf a year from now I think definitely have the 4-1K taken down have some peace I guess but you know I feel like we can have peace in the

basement and paying off the 4-1K loan So paying off the 401k loan cost you what out of your net profits? 37? Yeah Yeah Okay so you get your 170 out of the condo you pay down 37 you still got a nice pile

left. What is the basement going to cost? Around 50 to 60. Okay, you pay that. Now you still got money left. Then what? And then she wants, because the thing is, she's really scared about, you know, just in case we never know what's going to happen with our jobs. And I don't feel as though we don't, there's some good job security and what we do. You'll have six months of expenses saved, right? We do, yeah. We have about 40,000. So why don't you get on, you all make 400 grand a year? Why don't you'll get on a two-year plan.

And I don't know how y'all are going to do this. It's going to be tough, but y'all just live on $200,000 a year and take the other $200,000 and pay your house off in 24 months and give your wife freedom and peace. I do like that. You're 24 months away from this being a nothing burger. The recast makes you feel better, but it didn't really do anything. It's going to lower the payment, but it does nothing for the balance.

Okay. So recast, you're going to take a lump sum, throw it at the mortgage, and then you can recast it, and it'll just reamortize. Okay. And by the way, if you did that today, your recast would be at today's rates, which are going to be the penalty point of the rate you have in three or five years or whatever it is. Okay. Yeah, I guess I never thought about that.

But what if we just said screw all of that thinking, and you look at your wife and say, I want to take $200,000 a year and pay our house off in two years? After we put a basement in it, we take the other 60 grand, we put it towards the mortgage directly, bring it down, and then we're going to pay the sucker off. And no one can ever take our house from us. I mean, yeah, it sounds great. I think it's, you know, it sounds very easy in our brains. It's just, you know, two years from now.

Here's a deal, brother. Here's what your wife is saying. I have the lived experience of not being safe and I want to feel safe and the way she's trying to achieve safety is moving money around which is completely understandable if you look at her and say

I'll show you safety I'm going to be disciplined and safe and I'm going to propose a plan that I want you to speak into and together you and me ride or die will get this thing paid off in 24 months which means I'm going to not do all of my crazy whatever

and I'm not going to spend on this and blah, blah, blah, blah. I'm all in because I want you to walk into our home that nobody else has a stake to and just laugh because it's ours. That's what she's truly saying to you. I've been unsafe before. I've lost my house and I never want that feeling again. And she's just getting on YouTube or going to a local place and they're telling her, well, you could do this.

And you've got a wife who's in deep water. And she's saying, well, somebody reach down and grab me. And what she wants is stability and a plan and a guy who says, I'm all in on helping you feel safe in this home. Through action, not through feeling. You got what I'm saying? I do. And thank you for that advice. That's why I very clear.

Thanks for advice again. I was going to let her because she listens to this as well. Do you guys do a monthly budget together where you sit down and she has full awareness of what's going on with finances? Correct. Yes. We do it a little more than we like to. We do it once a week. Oh, wow.

Is that for her or for you? It's usually for me. Okay, stop. Stop. You're burying her. You're burying her. Your love for numbers is gasoline on her anxiety fire around numbers. I never thought about that.

You get what I'm saying? Y'all make a plan every month and stick to it. Okay. And then if you want to play with spreadsheets in the middle of the night, like I do, like I know George does, then do that. My favorite kind of insomnia. spreadsheet insomnia. So you've got the plan, man. It's more emotional than reality

because your income is so high, even if one of you lost your jobs, you're going to be okay. If you have no debt and emergency fund, the chances of both of you going without work for years is, that's paranoia at that point. Right. So you can decide,

do you want to give your wife a gift of putting $130,000 down on your principal of your mortgage and bringing it down really low and put off getting your basement for three years or two and a half years. Or do you want to say, hey, this basement's going to cost 60 grand. The other 60 is going to go directly to the principal. And here's a two-year plan to pay off this mortgage.

We're going to do this together. You also don't have that conversation because that's more, George, that's the actual issue here. There's no real clear plan about what we're doing and why we're doing it. Yeah. It's just that every week she gets dragged to the table to relook at numbers and what about this? And what if this happens? Which for her is just, oh, it's more of her body's like I told you we're not safe I told you this could happen I told you I told you I told you

and she's lived it man and that's a very man that's a real experience so good for you Ron for caring about her and for asking question in my house my wife has full you know transparency into the finances she has the accounts on her phone but I just become like a human version of that and every once in a while she just goes how much we have in savings I got here so much and she goes okay that's it it's just that's what you want your finances to be Well, it was funny. In my house, it's the opposite. Occasionally I'll be like, I'll tell my wife, hey, we have this much in savings? And she'll be like, have you not been sleeping again? And I'll be like, yeah, no, I haven't.

So it's me trying to make myself feel better by acting like I'm a tough, great husband, communicating. She's like, I know we're good. You can't save your way out of psychosis, John. Listen. I don't want to be the one to... Trust me. Be your armchair therapist here. No, that's what my real therapist said. Dave Ramsey here. For more than 30 years, I've been talking to folks on the

and I can tell you that most people are broke, not because they don't make enough money, but because they don't have a plan. You need to give every dollar you earn a job, because when you do that, something changes. You stop guessing, you stop worrying, you stop stressing. Our every dollar budgeting app will show you how to find extra cash, pay off debt, and finally start winning with money. But most people won't do it. They'll keep living paycheck to paycheck, Keep hoping things will change without making a change. It's time to say enough is enough. It's time to take control of your money.

It's time to start your every dollar budget for free today. Go download it in the app store or Google Play. Buying or selling your home is high stakes because one bad deal could cost you tens of thousands of dollars. You don't want to overpay for your next house or sell your current home for less than it's worth. And that's why Ramsey Trusted connects you with vetted real estate agents who have the experience to guide you. step by step to make smart decisions, not expensive mistakes. You can find a local Ramsey trusted agent for free, a Ramsey Solutions.com slash agent, or click the link in the description if you're on YouTube or podcast. Heath is in Columbus, Ohio up next. Heath, what's going on?

Hey, guys, appreciate to take my call. Absolutely. What's your question today? So I've got a situation with my in-laws. They are in their mid-70s, and during COVID, my father-in-law gambled away all their savings. How much was it? Yeah, so they, you know, I don't know exactly. They had worked their whole lives, and my mother-in-law, she got some inheritance from her parents when they passed away. Her parents were very well off,

so I'm assuming it was several hundred, thousands of dollars, but, you know, I don't know for certain how much it was. And they've been working full-time, you know, for the last couple of years, but they're getting older, and, you know, my wife and I are trying to figure out, like, what's the future and what's our role going to be in all this? I've got five small kids at home, and we're bursting at the seams in our place. So, you know, unless we move or add on to our house, like them staying with us is not an option. And, but, you know, their other kids are not really involved. So it's going to fall on us.

The burden is going to fall on us. Are the other siblings that estranged when you say they're not involved? Yes and no, it's kind of complicated, but they're really not in the picture as far as, or in a place to take care of them in any meaningful way. So your wife is the closest, you know, child they have that's actually still communicating with them? What does your wife want to do? I don't know. It's tough. I mean, we're probably about four hours away from them, so it's not like we can get over there once a week to go help them out with stuff. But, you know, I think if my in-laws would be open to it, I'm sure my wife would want them to move closer to us or in with us. I don't know if that would be something acceptable for my in-laws.

They're pretty stubborn. Do they have a mortgage? They do not. What's their house worth? I mean, they're in the middle of nowhere. It's probably if they could get $100 grand for it, that would be a lot of it. So I think the, I mean, you got two big challenges in front of you. One, will they even accept your help?

Yeah. Right. And maybe they won't now. Maybe they'll be forced to in five years. Like, who knows? But I think that's a, that is a thing that's really hard to metabolize when we want to help people that we love. And they are either too prideful or too scared or their ego is too big or any number of reasons. but they won't accept our support and love as we can give it, right?

And so that's number one. Number two is you and your wife have to just be flat out honest about what we can and can't do. Like, and like, because what happens a lot of times, especially in big emotional situations like this, is we just spend all of our energy on what we can't do or what we should do versus what we, and y'all need to have a honest come to Jesus conversation about here's what we, we could, do even if they would allow it. Could we have, could we come up with a thousand bucks to subsidize a one-bedroom apartment in our neighborhood?

That's all we can do. That's all we have. And we're not going to give the money to you. We're going to give it directly to the place. Can we support grocery? You get what I'm saying? Yeah, I do. And that's kind of, you know, part of the reason that it's difficult for us is that, you know, I do very well in my job and I've got a pretty significant amount of savings. And so, you know, if we were to add an addition onto our house or

something, we could do that. But, you know, I struggle with, well, okay, I mean, I've got, again, I've got a bunch of small kids. Like, I want to think about their future. And I want to plan to be able to not put my kids in the situation that they're putting us in. That's exactly right. That should be your priority. And so, you know, but at the same time, like, okay, yeah, we could, I could write a check tomorrow and we could put it, you know, an in-law suite addition on our house. And so that's just where, you know, I'm struggling with the right thing to do. And if we, I don't think if we told them, hey, we want, this is our plan. We want you to come live with us.

They probably would not accept it. But knowing what's probably going to happen in the future is that they're not going to be able to work at some point in the future. Right. If we had a place for them, then I think it would just be a natural choice for them to come with. Against their will. They would just do it. Well, they wouldn't have any other option. Well, so that's where, I mean, you're kind of giving us a very clear path for you and your wife,

which is y'all let them know when and if y'all need support, we're ready to sit down and have that conversation. And that conversation ends right there because they'll probably respond with, well, we're fine. You don't need to worry about us. Great. Cool. And then you and your wife have to live in the reality that probably at some point you will be responsible for some sort of care.

And so we'll start putting a little money aside over here. We might start looking at a different house down the road. We might look at one-bedroom apartments in the neighborhood. And by the way, a picture for your kids, it's easy for me to wrap my head around. The only legacy I can leave to my kids is money. There also is a huge legacy towards I watched my parents care and love well their aging parents. Right?

Like that's also part of legacy. It's also part of care. And so all of that is a tricky balance, right? And none of that comes in any sort of thing that y'all wanted or asked for, right? For sure. How much are they letting you into their own finances? Oh, very little. I mean, when they, ironically, Dr. Longer, I called a couple years ago when everything kind of hit the fan when they lost everything.

And you and Dave gave me some great advice. And so, you know, we're back now because, you know, if they had, if they were to tell me they had $10,000 in their bank account, I think that would probably be a surprise to me. Sure. You know, is he still gambling? They're, I don't think he's gambling anymore. But, I mean, they're working between the two of them. They're each working at least 40 hours a week, if not more, and they're almost 75 each. Are they taking Social Security?

Oh, they're not. My father-in-law held a cash-paying job his entire life, so probably did not report most of his income. So if they're taking social security, it's minimal. Okay. So you and your wife have to have the conversation of what does taking care of mean? Yeah. Is that going to be $3,000 in a nursing home? Is that going to be, like, are we going to help them sell everything so they can get on Medicaid?

Like, what is that going to look like for us? and you'll have you as her right or die you as her husband are going to say like you're going to have to work to not have that calculator running in your head of well if we had taken that money and invested it we could have given this to our kids right because if you all agree on a number like do your best to say I was a part of this decision I'm a I'm a guy who's not going to let two elderly people just like get stuck in the system especially if I'm being successful like I'm I'm going to grieve that, and then I'm going to go on and take care of folks in the amount and to the degree that me and my wife agreed, and then I'm going to go on about my life and go from there. And it could be, I'm probably pie in the sky here. It could be that, could it be that they would be fun to have around your kids, or is that a no-go? You know, I think they, I think they would be, but I just, you know, outside of something drastic happening, I can't see. At least my father-in-law wanting to leave. You know, it's a town he grew up. He was born, you know, in that town.

But he made choices. He may not have a choice to stay, right? He made a lot of poor choices, yeah. Yeah, but he may not, he may not ultimately because of his past choices. He may not get a say in whether he stays or not. Yeah, that's true. Which stinks. Hey, let me tell you this, brother, your anger's right. You're right to be mad at him for how he handled his finances, for how he did whatever it is he did.

That anger won't serve you, loving your wife well, and y'all coming up with a plan together moving forward for here's the reality that we have in front of us. None of us wanted this, none of us planned this, but this is what it is. And we are people who take care of our family. So here's what that's going to mean for us. Here's what we can or cannot do. You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage. To protect your biggest assets, I recommend using Ramsey trusted pros. Whether you're looking for car, home, or any other type of insurance, Ramsey trusted providers

have been coached and vetted to serve you like we would. Find what you need at ramsysolutions.com slash insurance. Welcome back to the Ramsey show. Our scripture of the day, Colossians 4 or 5. Be wise in the way you act toward outsiders. Make the most of every opportunity. My Angelou said, I've learned that even when I have pains, I don't have. have to be one. Yeah, George. I'm still learning. Listen to the Great Maya. I got to take that advice. All right. Sean is in Des Moines

up next. What's going on, Sean? Yeah, I'm just thanks for taking my call. Absolutely. Just trying to get down to the bottom of how my wife and I can stop living paycheck to paycheck.

I'm glad you're here. That's a big milestone. Just to want to do that. It's tough. I mean, we get bills paid, but I mean, at the end of the week, while we're sacrificing, you know, something that we not necessarily need, but, you know, there's not a lot left at the end of the week. How old are you guys? I'm 32 and she's 30. How long have you been married?

Not even a year. We'll be a year in November. Congrats. Okay, so what got you to this point? So, backstory, I married. My wife, she has three kids, and we are soon to have one of our own. and when I was a kid going through high school, my parents had told me that my grandparents had kind of set up a fund that grew and grew and grew to give all the grandkids a certain a lot of money for college. And that always kind of stuck with me that, you know, I'd like to do that to my kids someday.

You know, in the last year or two, we've been getting our stuff paid, but it's, you know, I want to be able to do something like that for my kids someday. So your stated goal is I want to create generational wealth, and therefore I need to have some eventually. And debt is holding me back from that. So how much debt do you guys have collectively? That was preexisting. I bought a parcel of land before we got married.

So now it's her land as well now. So that's kind of hanging over our head. We have $165,000 on our house. 76,000 in car notes and roughly 4,000 in credit card. Could you sell that parcel of land today? Not with a, there's a buyback clause. I bought it for my father. I had a buyer to sell in seven years,

that it would go back to my father. But would he give you the money back for it? I think he was happy to sell it. To me, I think he was happier to see the whole goals to the farm. And that was kind of his way of starting that. You know, I got it at a very discounted rate. If you sold it back to him, how much of a check would he write you? $800,000.

I mean, there's your generational wealth right there, really? Yeah, it's a family piece that I've been wanting for years. And that was kind of the push. I traveled for work for many years. I did that for nine years. And to be with my now stepkids and a kid to be on the way, I left that and joined another job, which paid significantly less, but more time with family.

So what do you guys make now as a household? 1.30. Okay. Well, there's some clear writing on the wall here that cars have to go. This is crazy to have 80 grand in cars making 1.30. Do you agree? Yeah. What are they worth?

Probably 25,000 on mine. I would say probably 40 to 45 on hers. Okay, so you're probably $6,000 underwater? Yeah. So you scrape together $6,000 over the next month or two. You can get rid of both of these cars and buy some cheap ones, maybe save up for a few more months. Yeah.

I mean, what are the payments on these things? the payment on mine and that kind of leads me into the next thing the land that I bought at a very discounted rate fell into a pretty good hole and had to use a line of credit against that still well below what it's worth but that note is hanging over our head as well

okay but listen you've talked yourself into a corner brother and I'm saying this man as a guy who obsessively I check land prices every day of my life, okay? And I'm not even a generational guy. Okay? So trust me, I love the impulse and the idea. But if Dave came here and brought me one of his cars that he's collected and said,

I'm going to give you this for 25% of its value, that's an incredible deal. But if I don't have that money, it's not a good deal for me. unless I'm planning on buying it and flipping it. Yeah. Here's what you have. You have two competing legacy dreams. One, I want my kids to have peace in their spirits when they leave our home, that they'll have some money in an account, that they can go take on the world. And you have another legacy, which is I'm going to come hell or high water, put my family into financial ruin for this vision.

But I will keep this land. I will farm it. Regardless of what's going on in the world, because that's who we are. And you have to pick which vision you and your wife want to live into. She's very stuck on her ways. As far as having really nice things, I didn't, I grew up very fortunate, not wealthy by any means. Very weird farmers. You know, we had to make do with what we have.

Sure. So that's been kind of a change, and I'm being humbled by it as well. maybe putting things off to not pay for them or not, you know, spend the money that we don't have. Sure. Well, Sean, there's two paths to go. It sounds like you're not going to sell either of the vehicles. You're not willing to sell the land. So the only other option is you guys work your tails off 80 hours a week for the next six years to try to get this thing paid off.

That's it. Or we can shortcut that by getting rid of these things that are going down in value, these vehicles that are crushing us. who are we trying to look good for? Because so far you said you want to build generational wealth, you're creating generational debt so far. At every turn, you are taking on more and more debt to try to fund this lifestyle to look like you've made it. Or sitting down with your dad and saying,

Dad, I want more than anything in the world to keep this farm, but I can't afford it. I simply cannot, like in this new world that I chose, which is three young kids, a fourth on the way, a new life with a new partner. I walked into this, eyes wide open, And this, I can't make this work anymore. I can't keep living two lives.

One is a farmer, as a generational farmer, landowner, having to take out lines of credit to keep farm running, and also be a responsible adult with these four kids I've got living this other life with my spouse. That's a tough pickle to find yourself in, man. But the longer you avoid dealing with reality, the old saying is conflict deferred, is conflict amplified. This problem doesn't go away. It just gets bigger and bigger and bigger. and bigger. The sooner you and your wife can align on who we want to be and what is that

vision going to cost us and how quickly can we get through that? That's the path to freedom, man. And none of this is easy. It all hurts, man. All that hurts. I can't imagine, George, going to my dad and saying, you gave me this incredible gift and I can't afford it. That would that would break my spirit, I think. And it probably break his spirit. And it's the right thing to do for my new responsibilities, my three kids plus the one on the way, plus my wife. That would be the right thing to do. Or sitting down my wife and saying, we make a good salary and we have this almost a million dollar piece of land. We cannot afford these two cars. We're going to sell them and we're going to drive beater cars because money in the account, money in our future is more

important than comfort today, right? I mean, I don't know another path forward. It sounds like you want to want to get out of the cycle of living paycheck to paycheck. Because if you want to, you've got a path right in front of you, man. It's not going to be a pleasant one, but you got a path, it's just going to take a complete reorientation of how y'all do life together. Right. And the hardest part for me is knowing, you know, like you said, you sit down and have a thought with my dad, but the hardest part for me is, you know, it's a significant amount of money to anybody. My fear is that by selling that back to him, that it's going to put him in financial ruins and that's that's something that's just been over my head for i mean you you can't

carry his burdens also this is hot potato right my hope is that he kept that eight hundred thousand dollars that you gave him man hard choices in front of you sean make the right ones that puts this hour of the ramsie show in the books remember there's ultimately only one way to financial peace and that's to walk daily with the prince of peace christ jesus