The Ramsey Show - Don’t Be Your Own Worst Enemy!

Episode Date: February 2, 2024

💵 Sign up for EveryDollar today - Create a free Budget! Jade Warshaw & Rachel Cruze answer your questions and discuss: "I feel stuck in a problem I didn't cause," Why you should never try to time the market, 5 reasons to get ANY job (not just wait for your dream job), Why you should think twice before pulling money out of your 401(k) for a hardship withdrawal, "Am I being too financially judgmental about the people I date?" 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! Support Our Sponsors: USCCA The Chosen BetterHelp Zander Insurance Neighborly Next Steps Why You Shouldn’t Withdraw From Your Retirement to Pay Off Debt 👍 Help us make the show better! Please fill out this quick survey! 🏠 Find a Ramsey Trusted Real Estate Agent 🎟️ It's game on! Get your ticket for Total Money Makeover Weekend.  Listen to more from Ramsey Network 🎙️ The Ramsey Show   🧠 The Dr. John Delony Show 🍸 Smart Money Happy Hour 💡 The Rachel Cruze Show 💸 The Ramsey Show Highlights 💰 George Kamel 💼 The Ken Coleman Show 📈 EntreLeadership Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

🎵 live from the headquarters of Ramsey Solutions it's the Ramsey Show where we help people build wealth do work that they love and create actual amazing relationships not the fake kind the real kind I'm your host Jade Warshaw joined by by rachel cruz host of the rachel cruz show that you can find on youtube also smart money happy hour love that right also the author of i'm glad for what i have listen the list goes on oh jade it's good to be here with you love it all right if you want to talk about your life or your money you can give us a call the number is 888-825-5225, and we will do exactly that. So let's go straight to the phone lines where we've got Nicole

in San Francisco, California. What's going on, Nicole? Hi, Jade. Thanks for taking my call. No problem. So my question is, I live in a very extensive area. Half of my take-home check goes to my rent. I work remotely, so it's kind of ridiculous that I'm staying here.

And I'm thinking about moving to Texas. I see that the new constructions in Texas, they have lower interest rates, like 4.9% interest rates, whereas the interest rates right now are 7%. And I'm wondering if that's too good to be true. Why are the new construction interest rates so low and attractive? And should it be something that I pursue? I have heard of new construction being able to offer lower rates. I guess they're eating that cost at some point within the process. I just love that you're looking at your situation and saying, listen, it's too expensive for me to live here rather than continue to struggle. I'm going to embrace new opportunities. So I don't think it's too good to be true. Does your question go further? No. Yeah. I was wondering if there was like some sort of trick that they're doing

that I'm not understanding. Um, you know, also it's a, it's a big move for me and it's something that I want to do because I am single and just live by myself and my dog. And, um, if I were to move to Texas and save money, I'll be able to pay for egg freezing, which is something that my job doesn't help pay for. And it's also something that I was like, I know I don't want to finance it. They have a lot of payment plans for egg freezing. And it's something that if I moved to Texas, I could save money because, I mean, even a mortgage payment is going to be way lower than what I pay for rent right now. Yeah and we're seeing that Nicole I mean like your situation it's very common and we're seeing that a lot with people in these like really high priced areas especially where you are San

Francisco the Bay Area I mean I think it's number one right now in the most expensive places to live but you look at people in New York and you know different places and we're seeing that people are gravitating obviously to places that they can actually have an affordable lifestyle and actually enjoy their money versus being taxed high, real estate being insane, you know, and experiencing exactly what you're experiencing. So just know you're not alone in that change, even though that's a big change. You're right. I'm like, when you decide to change locations and states and it is, I mean, you're uprooting your life. But I think what you have to realize is you're doing it for a reason, right?

You're not necessarily running away from something, right? You're running to the life that you want. And in order to get that and do the things that you want to do, like freeze your eggs and different things, you have to have more margin. And so that means other areas of your life are going to have to look different in order to do that. And so you're just kind of weighing the pros and cons. And I really applaud you for that. And it's not easy, but it's a reality. I think a lot of people, a lot of people are facing. 100%. And here's the thing, even if you get there and

you realize, oh man, whatever they quoted me on the interest rate, it's slightly higher, or it's not quite that. It's still a better situation financially. You're still going to get more for your money. You're still going to be able to afford owning a home or getting a place for yourself more easily. So what are you looking to spend? Can you tell us a little bit about what you're looking to spend? Obviously, having your rent or your mortgage be 50% of your income is just not sustainable long term. So have you identified a number that puts it at 25% and what you could spend in order to get that? Yeah, so I was looking at homes around 300,000, which here, I would be 1.5 million. Yeah, it's crazy, crazy. Well, good for you, Nicole. Nicole yeah I think it's great and I think you

know um I think builders are feeling a little bit of the pinch of people pulling back when rates went up suddenly everyone kind of paused and they're like I'll just wait to see if rates drop and then when they drop yeah they probably will they're going to fluctuate we're in election year things are always kind of up and down and then when they drop everybody's gotta be how the world works and I think Jade it just drives prices back up so if anything the time is is to get in now and you can always refinance later but if you're in a good position to buy a home I'm not saying everyone needs to rush out and buy a home but I think her Nicole's a great example of kind of looking at all your options being wise and I think yeah homes are not selling have not sold at least in the calendar

year of 2023 like they were in 22 and 21 um so I think new I think builders are feeling a little bit of that pinch they're probably wanting some inventory off their hands yeah and if they can partner with you know the bank and all the things and and get a lower rate they're probably doing that to entice people um but obviously Nicole do your due diligence i mean your home is for most people the largest purchase that you make in your lifetime so don't rush into something because i think sometimes at times even these new builds if they go real quick up they may not be the best quality i mean you want to look at for sure quality look at you know different different areas and all of it so do do your research because it's a big change and a big purchase um and even nicole what you could do is since you're moving to a brand new state different areas and all of it. So do your research because it's a big change and a big purchase.

And even, Nicole, what you could do is since you're moving to a brand new state, you could even rent, which I know you're so tired of renting right now, but you really could for six months to a year just to be like, okay, is this the part of Texas I want to be in? Because once you buy a home, you're planted there for a bit. Yeah. A completely new state, completely new culture. I i 100 agree with rachel in that i would rent for him and i would definitely would not do like a long long distance home purchase yes of like i wouldn't do that but to your point um i have seen like there are new builders that are offering those kind of incentives on the rate um because we had callers

call in saying listen i'm trying to sell my property and it's hard for me because I'm having to compete with a new builder around the corner who's offering a lower interest. So that is definitely happening. So just do your due diligence, do your homework. Don't just jump out there and buy the first thing you see that seems right. Because I mean, I think it takes a while, Rachel, to really get the feel of a new neighborhood, let alone a new city, let alone a new state. Like there's a lot of totally. Yes. So, yep, absolutely.

Yeah. And I think, Nicole, too, I do. I do applaud you just for looking at options because, Jade, we talked to a lot of people and they're stuck. I feel like we always pick on California. But California is expensive. Your real estate is high and it's a high cost of living. So it's an easy place to pick on. But, you know, a lot of people and they're like, well, I'm in California. I'm in California. I'm in California. This is it real estate is high and it's a high cost of living so it's an easy place to pick on but you know a lot of people and they're like well I'm in California I'm in California I'm in California this is it this is it and you have to realize about anything in life which again I

know uprooting your life is a big deal so I'm not saying it flippantly but I just love the fact that she is taking initiative and saying hey I can make choices in my life that's right and for me to have the kind of life that I want, it's going to require some changes. And so for some of you, maybe it's changing your money habits. For some of you, it's changing location. I mean, I don't know what it looks like for you,

but this idea that I have control over my life and I get to make decisions for myself, it's powerful. That's right. And remember, it's not just change for the sake of change. It's change to get you where you want to go. You want to be a homeowner. You want to have more margin in your budget.

You want to be able to enjoy your income. So focus on that side instead of focusing on the uncomfortable part, you know, the change or I may not know anybody. And just like think of it as an adventure. You're off on an adventure to create the life you love in the words of Rachel Cruz. That's right, Jade. This is The Ramsey Show. You're listening to The Ramsey Show.

I'm Jade Warshaw. This is Rachel Cruz. And we're taking your calls for the next couple hours about your life and your money. So give us a call. The number is 888-825-5225. And we would be happy to answer any of the questions that you have. In the meantime, the Ramsey Show question of the day is brought to you by Neighborly, your hub for home services. Neighborly offers a helpful winter maintenance checklist that you can download for free at

Neighborly.com. That would be very helpful for me. And for the more challenging stuff in and around your home, Neighborly has a local pro to help. Find out more at Neighborly has a local pro to help. Find out more at neighborly.com slash Ramsey. And today's question comes from Heather in Wyoming. I'm a stay-at-home mom, and this has been the most stressful, painful past two years of my life, with my husband making horrible financial decisions that left us over $500,000 in debt.

He owns a tree service business making $70,000 a year and is trying to start a mobile mechanic business and has purchased an investment property. We have $163,000 mortgage on our house. The rent is a total disaster that's completely, the rental, I'm sorry, the rental is a total disaster that's completely gutted and we have to make payments every month while earning no income with it And no progress on the repairs He also bought a brand new truck that we owe now Eighty four thousand dollars on and eighteen thousand dollars on a loan on a bobcat for the business A twenty thousand dollar home equity loan that he used to fix up the rental

Oh and over five thousand dollars in credit cards he keeps saying he's working on it and he is a hard worker but has put us in a completely impossible situation that danger that angers me and stresses me out every single day i work odd hours because we can't afford child care nor do i want to give up time with my kids to fix a problem that I did not cause. I feel so stuck and hopeless. All right. Can we just listen? I wrote it all out because I'm trying to track with this. Okay, Heather, this is not a you shouldn't be this way.

She's very bitter. Yes. As we can tell. Yes. Very resentful, which again, it's is valid is valid um but they feel like not only different pages financially but they have been split now emotionally really severed i mean she wants it sounds like she wants nothing to do i mean nothing to do with him yeah oh and five thousand dollars in credit card you know i mean it is stuck and hopeless she is she is not not in a good place

which which i get it heather i'm like She is. She is not not in a good place, which I get it, Heather. I'm like, yeah, all these decisions were not wise decisions made. He made decisions without obviously talking to her or working as a team. So what do we do, Heather? What are we going to do? I'm seeking counsel. Number one, like I always talk to folks about keeping their money safe. Rachel, it's kind of like an acronym. And the first thing to decide, like I always talk to folks about keeping their money safe, Rachel. It's kind of like an acronym.

And the first thing to decide like where you're at. So S is for seeking counsel. Like if you're noticing trends within your money with your spouse that you're like, what's going on here? I feel uncomfortable. I feel unsafe financially. I feel like there's something going on. Seek counsel.

And then you're going to find, listen, if there's things like addiction, abuse, that's the A. Yeah. And then F is financial infidelity, which this is getting real close to falling under. In my opinion, it is because he's going out and spending massive amounts of money without your... Permit? Well, I say permission, your... Input. Input, yes.

Yeah, without a mattering. And then the E of that is you need to evaluate your options. So that's how you go through this. And I do think that this is a sometimes people think financial infidelity is like I'm just hiding money under the mattress or something like that. But I'm like, this is a lot of money. And it sounds like we don't know, Rachel, but it sounds like she has made her objections clear. And it sounds like we could be wrong.

It might be something that he did. And then after the fact, she was like, well, how could you do that? But even still, you've got this is there's financial issues here. But when I look at this, I go, this is a couple who desperately needs to go to therapy. Like they need they need help. And yeah. And he's he's obviously not living in reality. No. And there's people like that that we talk to.

And I hate to like pinpoint people, but it's the dreamers. It's oh i have i have an idea and this idea is gonna work i have a new idea here and don't worry don't worry this is surely gonna and and it is it's a level of immaturity to a point when you actually make decisions in those dreams and they don't come to fruition you have to have reality to say i can't do this anymore so there's a safety here Heather that I um that I would want for you like a point where you're like I can't I can't keep putting myself there's a level of danger there in this situation that's endangering my kids and my family that that is what it is so that weight that you're feeling is very very real and I just want him to wake up to the reality and I think what's going to have to happen is a third party.

You're probably not going to be the one to do it, Heather, sadly. And I think sometimes, I mean, it's like our spouse. I mean, all of us feel that way with our spouses. There's always that thing that you're like, if you know this, this or this, and you can say it and then it ends up being nagging and it's not effective. But when you actually sit down with a third party, usually if it's coming from someone else, it's speaking there. But that's it. I'm like, the financial issues here are a symptom of where you guys are in your marriage.

And again, I don't blame you, Heather, for being angry and bitter. But what are we going to do with that? We can't just sit in that and continue to be in that cycle. You, Heather, have to then grow and learn. Are there boundaries you put up now? What do you do now? What are those steps? Yes, that's right. Which is really hard, but that's the situation. Yeah, that's right. Because something's got to change. And in a situation like this, not to belabor it, but there's very little you can do to control the other party. Like there's nothing you can do really to control the other party, but you've got to sit down and figure out, okay, what am I, Heather, going to do uh in order to

try to better this situation i can seek out counsel i can put these boundaries in place but then you've also got to kind of have that point of where you go okay where does this just get completely toxic and you know that's up to you and a like like rachel said a third party to i mean yeah and jade we talk all the time about couples staying on the same page being on the same team all of this but there's extreme situations that we talk about a lot and i mean heather may be in one of those for me where i'm like there's a point that you have to protect yourself and your kids right like if he's going to continue to spend i mean hundreds of thousands of dollars like i don't want my name on those i don't want my name

on that and if you're headed towards it i'm not putting this I'm not putting this evil on you but if you're heading towards a point where like listen I don't know if I see us together in the future the more he racks up like I don't want to be any part of that because if you don't stick together there's like I'm looking like yeah so first part of this gonna be on me no you know yeah so for the time being Heather there's probably some hard boundaries I would put up to protect you and the kids but working on your marriage could solve a lot of this. And then my prayer is that they would get to a point that they're in agreement and realize, okay, he's not going to do X, Y, and Z. And now as a team, we have to work together. And if you guys get to that point,

Heather, that's where you have to say, all right, we're in this together. What are we going to do? That's right. And then it's on both of you to just link arms, we're in this together. What are we going to do? That's right. And then it's on both of you to just link arms and get out of it together. Yep. And that's what we pray for. We don't want this to split couples, but this is the stuff that causes divorce in marriages, right?

100%. If another spouse doesn't want to take the responsibility of the decisions they've made, they're probably not taking responsibility in other parts of the marriage too. That's such a good point. So hard. Such a good point and such a good reminder, too. That's such a good point. So hard.

Such a good point and such a good reminder, man. It's uncomfortable and it is not fun. But have conversations with that person that you're engaged to or even that person that you're dating. And if you've just gotten married, start having these conversations. You've got to know the other person's philosophy on money at the end of the day and not just make assumptions and go, oh, they've got a good job. They probably have it together or they don't seem like they have a lot of debt, like really digging deeper and figuring out and just asking, you know, even when you dream together, Rachel,

like I know there's times Sam and I will sit together and think about, oh, it would be cool to have a business like that one day. Then take it at a level deeper and go, well, to what extremes would you go? Like, I would never take out money for a business. Would you? You know, really ask the questions. Find ways to bring money into the conversation so you really understand in a lot of different facets what their views are on money.

Because as we see here, it can really be an issue long term. Such a tension point. So yeah, it's a big relational uh wedge that's caused so yeah you're exactly right and i think you know especially when you're dating engaged we get this question a lot of you know when do i bring up the money when do i love it and you know we would always encourage to be having hard conversations about everything right and and we've talked to people on the show that have been dating for six years and they don't know anything

about their partner's financial situation and they think this or that. And I remember being on the show with you one time and we were like, what do they talk about? I know.

So take this stuff seriously, you guys. I'm like, don't ask about their 401k on the first date. That's a little extreme. But start, you know, understanding like

to be in the same value system with the person you're going to link arms with. And, um, yeah, but it's, it's a hard one. It reveals a lot. Listen, I say all the time, if you have babies together, you can share a bank account like that, that needs to be it. And both people's opinions should matter. And sometimes it takes some time and many, many conversations and counseling to get to that point, but go through that journey. This is The Ramsey Show. This is The Ramsey Show. I'm Jade Warshaw. This is Rachel Cruz to my right, and we're taking your calls. So give us a call. The number is 888-825-5225, and we'll try to help you out. Let's go straight to the phone lines where we have Avery in Newport News, Virginia. What's going on, Avery? Hey, Jade and Rachel. It's so great to talk to you. I can't wait to see you guys in May. Awesome. Oh, you're coming to the Total Money Makeover weekend? Oh yeah, absolutely. And I'm bringing a friend too. Love it. That's exciting.

Love that. How can we help today? All right, so here is the situation. My mom always says the strongest thing in the universe is compound interest. My brother always says time in the market beats timing the market every time. Let's go. And I thought I was smart enough to time a dip. I had about $21,000 worth in a Fidelity mutual fund in my Roth IRA, and I sold my positions on it back in September. I was going off a bad hunch and have watched the market rally by at least 20%

since, and I've calculated that I've missed out on about $4,000 worth of gross. I'm kicking myself. I still contribute weekly, but that $21,000 is still sitting there in the account. I feel like I've learned my lesson, but what do I do now? Should I buy back in or should I wait for the rally to end and maybe buy in on a dip? Listen, I'm glad that you've learned your lesson and I hope that it sticks. Do you have any debt? I have no debt. Okay.

Do you have three to six months of expenses saved? Yes, I do. Awesome. Listen, I'm getting back in today. And from here on out, I'm adding 15% of my gross income to it every single month. Okay. Today? Yeah.

How are you feeling? Are your armpits sweating? What's going on? Yeah, I feel like, I don't know if I buy now. I feel like it's so high. If you wait, you're timing the market again. That means you haven't learned your lesson yet. Avery.

Yes. Listen. Yeah, because Avery, I think the point, though, is that all of this is long term, right? So whether you get in today, whether you get in in 30 days, whatever it is, the earlier you get in and you ride this out, again, long-term, we're talking decades here, that's what's important. So $4,000 at the end of when you're 65,

it's going to be a drop in the bucket because how old are you now? I'm 25. Yeah. so like all of the I mean it is the if you time it if Avery of February of 24 is different than Avery in July of 24 I mean like you know if you wait six months or whatever it's not absolutely the end of the world but I think it's more about the principle behind this right right? The idea is that I can't time the market. It's an election year. We have no clue what's going to happen.

And so if anything, I'm like, yeah, the lesson is I'm not going to try to time the market. The lesson is I want to invest long-term. That's what I'm doing. So to practice on the principle of the idea is to say, yeah, I'm at a position to start investing. Put my money in the market. Yeah. Okay. And so even if I buy in today and then it goes down, like, I feel like I'm going to kick myself again. Avery, you're not going to worry about it until

you're 65. How old are you? 24, 25. Listen, think about it. Okay. If you, I think you're focusing in Rachel, try to lay it out for you and I think she did a beautiful job but let me take a swing at it I think you're so focused in whatever rate of return that you're hoping to get immediately or in the next couple of months but if you look at it the like I don't know if you're new to the show but we talk all the time about oh you can get you know even if you just invest in an S&P 500 account, you're still going to look at about 10% over time. Everything is over time. And if you're pulling it out every month or every other month, or when you think the market is dipping, you're

not allowing for the rebound that always happens on the other end of that. And you can look over the last 20 years, even you can just see, listen, the annualized rate of return has been upwards of 10%. And that's what you can count on. your worst enemy okay you're going to be the person that's going to be going on CNBC and watching the the ticker at the bottom daily and saying oh gosh oh gosh Avery you got you have to you have to put the money in and you've got to forget about it that's what this is this part of investing is that it is long-term retirement type mentality and and it's going to take some it it's gonna take some uh restraint from you and your personality because already i'm trying to talk you off the ledge and your money's not even in the market you know what avery you have to really avery avery is who really needs a smart

vestor pro because one of the things that they will help you do is not freak out talk you off the ledge yes yes exactly yeah so it is one of those things Avery you I mean I never really I mean I watched the market for this job so so we know what's going on in the economy but from a personal standpoint I'm like and it kind of sucks for me Avery from a personally because I'm like I'm such a spender and when we fund our 401ks and Roths and all the things that we're supposed to do because we're smart and we're wise and we actually do it jade even though it kind of makes me like because it feels like a black hole and i'm like this money is leaving where we could be going on

a great vacation this summer that is hilarious so it does kind of feel like man my money's just leaving and i'm never going to see it again. But you have to know that 65-year-old Avery is going to want to live a great life. And you're going to have plenty of money to do that, Avery, if you start investing now and not try to time every little thing. Because when you're in that little situation, that's the principle you live by. You're not going to win long-term

because you have to have a long-term mentality. Yeah, you can't do the i feel like he's trying to find a way to maybe make this thing happen faster and get rich quick and i'm like listen it doesn't work that way and if it does i feel like it's a fluke and then everybody tries to figure out what it was that they did and it's like listen just understand it was just something that happened in a moment. So, ooh, I hope that helps. Let's take another call. Let's go to Haley in Philadelphia. All right, Haley, what's going on? Hey, guys.

Thanks for taking my call. You're welcome. How can we help? My question is, I'm wondering if I should sell my car to pay off my student loans or if I should keep my car, pay it off tomorrow, and follow the baby steps to pay off my student loan. Okay. Well, how much do you have saved and how much is the car bringing if you sell it? So I have $10,000 saved and the car value on Kelley Blue Book is $15,000.

Okay. Do you owe anything on the car? Yeah, I owe $5,000 okay five thousand so essentially you'd be how much how much is your student loans um i have 17 000 okay how much do you make a year i make 70 okay no i would not sell this car no you owe five thousand dollars throw that throw five thousand of the ten thousand but i haven't paid off today and it's gone. And then you have, yeah, 4,000. Keep $1,000 in an emergency fund. Take 4,000, throw it at, yeah, the student loans.

And gosh, and you got 13,000 left. Making 70,000, you're gonna, yeah, you'll be able to pay off these student loans quick. Yeah, I love it. Yeah, I would not sell it. Okay, perfect. And I i'm right now i'm putting 11 of my um take on pay into my 401k so i'm assuming i should probably stop that yes that's right pause that yep exactly so that'll be more money back in your paycheck to throw at the stat

which is which is awesome yeah i mean if you had like we talked to a girl um two days ago me and george said and she had a suv bmw she could sell it for like 70 000 i mean it was a pretty big like chunk you know she owed some money on it she could have paid it off with her style all this stuff but i'm like but i mean like it was a it was like it's a it was a you know an asset that's like oh my gosh you could sell it and make something but no you yeah with with a 15 000 car you owe five you make 70 you're in a great position just to sell it and you have that $10,000 saved which is awesome oh yeah and I I mean the reason why I wanted to sell my car to begin with is because I live in I live in Philly so I don't and I work from home

so I'm literally using my car once a week and I'm probably like go see my parents um so that was kind of my my okay but I mean it makes sense too i mean it's i don't feel like it's something that's on fire for you to make that choice right away i'm with rachel if you if you still owed 15 on it it might be a different discussion but the fact that you only owe five and you have the five in your possession and you still have money to make decent headway on the student loan i feel like it's something that after you pay off the car and maybe a year from now, if you're like, listen, I never use this car, you might decide to sell it. But for now, sticking with it. Listen, good job.

I'm happy for you. You'll be debt free in no time. This is The Ramsey Show. This show is sponsored by BetterHelp. This is the season for Halloween. It's October. We're wearing costumes and we're wearing masks. So if you haven't started planning your costume yet, get on it. And while you're thinking

about it, I want you to be honest. A lot of us hide ourselves. We hide our true selves behind costumes and masks all the time. We do this at work. We do this around our friends. We do this around our families. We even do this when we look at ourselves in the mirror. I know because I've been there multiple times in my life and it's the worst. If you feel like you're stuck hiding behind masks and costumes all the time, if you find yourself hiding from your true self, I want you to consider talking with a therapist. Therapy is a place where you can be honest, where you can talk to somebody else and reflect and learn, and you can accept all the parts of yourself over time and start living an authentic life. Masks and costumes should be for Halloween parties, not for our emotions and our true selves. And if you're

considering therapy, try calling my friends at BetterHelp. BetterHelp is 100% online therapy. You can talk with your therapist anywhere anywhere so it's convenient for you and your schedule just fill out a short online survey and you'll be matched with a licensed therapist plus you can switch therapist at any time for no additional cost take off the costumes and take off the mask with better help visit betterhelp.com slash deloney to get 10% off your first month. That's betterhelp.com. You are listening to The Ramsey Show. I'm Jade Warshaw. This is Rachel Cruz. And let me tell you something. I'm hyped, guys, because we have a great live event coming up in the late spring. Actually, it's May 10th through 11th. It's the Total Money Makeover Weekend.

And listen, I've been here for some really great live events, Rachel, but I think this might be the one that I'm most excited about. It's going to be all the personalities. It's a whole weekend here in Nashville at our live event center up there on a beautiful hill with a beautiful view of Nashville and the surrounding area. And we're just giving you a crash course on the Baby Steps, how to manage your money. I love this event because it's really for anybody, regardless of where you are in the Baby Steps. You could be on Baby Step 1 or Baby Step 7. Yes. And you're really going to benefit from being at this event. It's like a rally, Rachel. I'm

here for it. And you know, at Ramsey, we've done so many different types of events, like you said. And we try to cover, you know, some events we try to cover your whole life and we try to you know get it do it all but it is fun to kind of focus in on a subject like money which Ramsey's you know it's what we talk about most of the time here on the show and so to have a whole weekend dedicated to that yes and really have the time to walk through principles and ideas and motivation and fun. George and I are going to do a Smart Money Happy Hour live broadcast the Friday before.

I think I'm allowed to say that. Go ahead and say it. If you didn't, if I wasn't supposed to, sorry. And yeah, there's just some really fun things we're going to be doing. And if you are a fan of the content on this show and others, you're going to love this weekend. It's really fun. Listen, I'm excited. I had a meeting yesterday with one of our folks on staff who helps plan the content on this show and others you're going to love this weekend. It's, it's a really fun. Listen, I'm excited.

I had a meeting yesterday with one of our folks on staff who helps plan the content. And I told her one of my ideas is out of the box, Rachel. So you're always good at that. It's going to be a creative. So early bird tickets start at $99, but remember it's for a limited time.

So go to Ramsey solutions.com slash events today, because Rachel and I both know these tickets sell out super fast. And if you want that early bird pricing, you got to do it today or like tomorrow, this weekend. You just got paid. So go on ahead and do it. It's $99. Get that now at RamseySolutions.com slash events. That's exciting. Man, after that, I feel like we have to go to the phone lines. If you want to call in the numbers, 888-825-5225, and we'll try to get to your call. But in the meantime, we have Madison in Tampa, Florida. What's going on, Madison?

Hi, guys. Thanks for taking my call. So I'm just in a predicament. I just found out that I will be terminated from my job that I've been at for almost five years. As of July 31st of this year. Sorry. I'm so sorry. What do you do? I'm currently a business financial administrator for a sales and marketing company. Okay. Yeah. I make about $43,000 a year at this job. So I have six months to plan um we're not officially

terminated until july 31st and at that time we will receive severance although i don't know how much okay um i keep going i was gonna say i don't currently have anything in savings and i'm worried about what's coming next yeah so Madison the way I would Handle this you know when we Talk to people who are paying off debt And there's a big Life change that they are aware Of most of the time it's a baby right

They're pregnant and we call it stork mode Pause the debt snowball and just pile up money And I would say the same would be true If someone knows that they're going to relocate And they know that they're going to have some moving expenses we'd say put some of that money aside and for you thank god you have six months which is a gift to at least know that they're not coming in and they're like today's your last day honestly so for now I would I would save you know as much as possible I would be in that mode of saving saving saving do you have a lot of debt um so I have about thirteen thousand dollars in debt um what's it in the majority of it

uh student loans okay um I just recently got my accounting my associate's degree in accounting okay okay so yeah so what I would do I would be saving Madison and then I mean I would start looking what Mayish and say hey I'm gonna or even line up a job sooner than that and say, I'm trying to do it now. Would you leave the job? I always wonder about that. They give you six months. I mean, if you know if you know what's happening in six months, I know I would not wait. I personally would not wait to the wire. Yeah, I don't. I'll be honest with you, Madison. I don't know a ton about the financial admin space. Is there a lot of jobs out there? Is it easy to just kind of go and apply for something and get it? Or do you feel like,

you know, that it could be a couple of months to find something? What do you think? Have you looked or do you kind of know the landscape? So I don't think there's much as far as the admin side, but I do have a part time currently with a company called Primerica, and I'm currently getting licensed. I just recently got licensed for life insurance, and I'm currently trying to get licensed for investments. So I've been trying to build that, and I am also wondering, so I'm about to receive my tax return that time of year. I'm going to receive a nice chunk. I have a 12- old, three year old, two year old and a one year old. Oh, we didn't get that. OK, so you have four kids. Yeah. Yeah.

So I'm you know, I'm going to receive about a little over ten thousand dollars for my tax return. And I'm wondering what my best steps are to save it. Are you married, Madison? No, I'm not. I have a partner. I do have a boyfriend. Okay. I just didn't know if there was like a dual income situation. Here's the thing. Yeah, I'm the only, I'm the breadwinner in my situation. Okay.

Don't stick, what I don't want you to do is stick around simply to get the severance. Like thinking like, I'm going to do this thing up to the wire to get, especially an unknown amount that you're like, listen, I don't even know how much it is um i in this equation i care more about um taking care of the stability and taking care of the kids so really lining up something or at least listen start getting options it's not to say that you have to take the first job you apply for but start seeing what's out there if i'm you i'm using this as an opportunity to take a step up find find another position that's within my field of knowledge and what I love to do to possibly get a raise and get a higher salary and really just look at this. I mean, I know it sucks and it hurts. You've been there for five years. But like Rachel said, it's

a gift that you've got six months and really think of this as the stair step to the next best thing and the next good thing for you and your family. And before you get off here, let's connect her with some of the Ken Coleman materials. Yes, the assessments, his book, Proximity Principle would be great too. Yeah, so Austin, if we can give those to her, that's a great point. Yeah, and Madison, I would be encouraged too. You know, I mean, it's not like you're trying to replace $143,000 position. $43,000, you can do that.

You're smart. You've done this and you've been with this company for five years. So there is, you know, a part of do that you're smart you've done this and and you've been with this company for five years so there is you know a part of you that you want to leave well but i don't know why my my heart kind of flipped on this jay but when i'm like oh you got four kids all right we're a single mom we got to provide yeah now you have to do what's best for madison and and i think you can leave well and respectfully but i would be looking for another job because you got to pay your bills yeah and so and if you find it and you find a job you love and they need a sooner start date i would just tell the company you know i would get plenty of notice yeah we do it respectfully but you have

to take care you have four kids to take care of so i would i would do this faster you know and again i hate to say if you're a single person all that but you don't have there's not as much that's right it's on you you could probably have a level of flexibility to a degree but when you have dependents yeah in your household you want to make sure that that you're well covered so i would be saving that tax return i would be saving every penny you can between now and finding a new job but well let's talk about that rachel okay so when i was in my day um when if you a job, it was like, listen, give two weeks notice or more if you can. Is that still like the running?

I think so. Is that still the thing, two weeks notice? To me, I feel like that's a respectful, right? And the company, you know, like here at Ramsey, if someone gives her two weeks, they usually don't stay the whole two weeks. It's like, hey, let's wrap some stuff up. Because once you're done, you're done.

Yes. But if they're in a position of, because it sounds like layoffs. It's lay layoffs so the company's not in a good position so if she does have a critical role i would want to hand that responsibility off yes to do it well before my area is is gone or whatever the situation is um so that'll never bite you in the butt it's all you never want to burn bridges it's very appropriate yeah i think yeah i think so too i'm like listen if you can more, if there's a way to do that, I'm not mad at that either. Because people give less.

And I'm like, or two days. That's terrible. I know. Or to just walk in and be like, I quit. Like, are you kidding? Listen, you never know. One thing I've learned, Rachel, is you never know who you'll run into on down the line. You know, you get older.

Because the world is small. Like it's big, but it's small. And I've always been shocked at the people who have like come back around in my life or vice versa. And it's kind of funny because sometimes people want things and I'm like, I know how you were. I worked with you before. You know?

Yeah. But Madison too. And anyone out there that has a big change like that. I think Jade, you said something that I was like, yes, see this as an opportunity of growth. And Ken's book, The Proximity Principle is really going to help you find that next better thing, right? This is a closed door to open something great. And we want to believe that for you, Madison. Absolutely. Well, thanks for hanging out with us. Keep hanging out with us. We're going to take more of your calls. Hear from more of you guys coming up next.

Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. I'm your host for this hour, Jade Warshaw, joined by your other host, Rachel Cruz, and we are taking your calls for the next couple of hours on your life, your money, whatever it is that's going on in your financial situation. We'd like to help you with that. So give us a call. The number is 888-825-5225, and we'd be happy to give our two cents. All right, let's go straight to the phone lines. We've got Trevor in Tacoma, Washington. What's going on, Trevor? Hey, thanks for taking my call. You bet.

Yes, I had a question. Me and my wife have been paying off debt for the past seven years slowly, but we have two items left, which is our house and my student debt. Okay. Last year, I started investing through Fidelity, and within six months, I've put in about $10,000, pretty much from side hustles. Okay. And my student debt is around that same amount, $10,000. It's the last debt I have. I feel like I know the answer, but I'm wondering if I should pull that and pay off the student debt. I haven't made really any money in the stock market, only being in there for six months. Is it just a brokerage account

or is it a retirement account? I have two. I maxed out last year and then I've started this year. So in the Roth, I have about $7,500 and in a just normal brokerage, it's about $1,800. I would not touch the Roth. It's retirement and I do not want you to start the habit of if I need money, I pull it out of my retirement. Now, if you had single stocks laying around, listen, what's in the brokerage is technically up for grabs. It's not a whole lot of money, but it's some money. What I really want to hammer home, though, is the idea of just stay the course. It sounds like you understood that the plan is for you to pause retirement until you finish paying off debt. But it sounds like, and I relate to this because when you said seven years, everything in my body went, I know about that because it took my husband and

I seven and a half years. And it sounds like you kind of got a little bit weary and maybe felt like you were getting behind. And so maybe you started investing. And I just want to encourage you from this point on, listen, I would stop investing and finish paying off this debt. Like I said, don't touch your retirement, what you've put in there already. If you want to pull what's in the brokerage, you can. There's no penalty on that other than maybe a little bit of tax on it. How much do you guys make a year, Trevor? We're a single home income. I stay at home and homeschool two kids and she makes about 70, 70 thousand. And so you guys have been paying off debt for seven years. What was the debt you guys paid off and how much was it? It was actually my side. We got married a few years ago and it was all my

side debt. And it was, oh, gee, the whole story of me being in the military overseas and my other significant other not paying off that. And it just stacked up, racked up, and it was horrible. Gotcha. Gotcha. Okay. I was talking about credit cards, repossessed cars. Yeah. So you guys have been through it, Trevor. I mean, to Jade's point, I'm like seven years. But honestly, so I get the, you know,

there's a weariness there where you're just like, oh my gosh. But, but what you've done though, so far, which is one of the biggest obstacles for people is to change what you believe about money, right? There was one set of beliefs that you had overseas in the military that got you, you know, those choices created an outcome that you said i don't like this outcome so you have been working your way right out of this so i think that one of the biggest again hurdles you've overcome that is hey i'm going to look at money differently but then you get into the details into the kind of the nitpicky stuff like we are here at ramsey where we're like pause retirement like there's certain things you do for a reason. This isn't just for the heck of it.

It's because of what we've seen over time. And this last bit, Trevor, I mean, this is like. Home stretch. I know. I hate to even like relate it to this, but I just watched a video. It was on Instagram real and there was a. I mean, the cars are paid off now. Is there a way I can do both?

Maybe make a higher payment on my student debt? No, I think you just, I think you just Pause it, you're going to be okay for a year For a year And you guys make $70,000 And I would even, Trevor If there's anything at night That you can go do, if you can make a side gig With $1,000 a month

That's going to add to this This is where my money came from With side gigs What about the 70? Do you have anything that you guys, from just a lifestyle standpoint, that you can cut? Oh, we've been cut in the past two months. Subscriptions. Okay, good, good.

So you're kind of back in it. It's that fuel. But it's almost like you're limping a little bit to that finish line. And I want you to sprint. Like, I just want you to get there. And you're going to be okay if it pauses for a year. How old are you guys? 33. Oh, yeah yeah you guys are fine jade's got yeah jade i love walking you through this okay you said um you're investing a little bit now what percentage are you investing

how much a month again it's not from our actual account it's from me doing side hustles still around a thousand a month okay you're investing a thousand a month which means obviously when you have this debt clear you'll have that and more to invest right so let's just pretend that you said right now there's 75 in your roth i'll just put it at 5,000 just to be i'm gonna make this like so foolproof and let's say that every month you do an additional thousand dollars every single month. This is after you're out of debt. This is after you're out of debt. And this is I'm going to do like a super conservative rate of return. I'm going to say eight percent just for all the hater aides out there to just calm down. And let's say you retire at thirty three. Right.

Let's see how much money that would be for you. Oh, shoot. No, not retire at thirty three. He has thirty three. Oh, he has. He's i'm saying for 33 years for 30 years in 30 years okay i'm sorry i'm sorry yeah yeah wait rachel keep the conversation going because my computer's being yeah yeah so he's 33 and let's say in 30 years you decide that yeah i'm going to retire at 63 yeah 64 uh the beautiful thing is that you'll see what the decisions you've already made with the roth which again would not um completely agree with because you still have debts but the proof is is that even if you waited one more year didn't contribute anything to investments or retirement paid off this debt went back to investing in retirement and put money away in 30, 33 years. Dude, $1.5 million in 30 years.

And just pause this year. Yeah, you're still good. My point is you're still going to be just fine. Sorry for the delay. My computer was not doing what I wanted it to do. But that's starting at $7,000, which you said you have 75 in your Roth right now. That's a 30 year term. You're in your 30s now. You're going to invest. You're going to retire in your 60s. It's a 30 year term you're you're in your 30s now you're going to invest you're going to you know retire in your 60s it's a very conservative rate of return that i put in here you're going to do better than that rate of return i'm just letting you know and this is a thousand bucks a month like come on now and then 15 of your income to you with that 70 000 i would push you guys to say yeah instead of that going you know to debt that's going to be now going to investing and this is assuming nothing changes like you're going to earn more money you're going to have more opportunities like

i just want you to see worst case scenario is 1.5 million dollars yeah come on rachel cruz oh my goodness i'm so excited i feel like people need to do this more people need to run out the numbers and stop letting it circle above their head and cause them- And the fear that's out there. Yeah. It's like you're over here getting a stomach ulcer because you're like, I'm getting too old.

And I used to feel that way. My husband and I didn't start investing until our mid thirties. And now I see like, we're going to be just fine. And you're going to be just fine too. Work the plan as planned. It works every time. This is The Ramsey Show.

Are you working the baby steps? One of the smartest and most impactful changes you can make is to ditch your cash value life insurance plan, if you have one, and replace it with a term life policy. Listen, the only thing a cash value policy is good for is overcharging you for the life insurance and then paying you a crappy rate of return on your overpayment.

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We're just so grateful that each and every day you guys choose to log in or go onto YouTube or go to your podcaster and pick our show to listen to. Like, that's great. We're here because of you all. And we just want to encourage you to keep doing that. Keep liking, keep subscribing and really keep keep sharing it with people that you think will enjoy the content that we give to you guys every single day. It doesn't cost you anything. us and for the people around you because they get this wonderful resource, but it also helps us because it just helps the algorithm favor us a little bit more above some of the other things that are out there. So if you like this, tell other folks about it. You know, they might have their crime podcast that they like, but like tell them about the Ramsey show. It's me. It's me. Listen, these crime podcasts, I don't, Rachel, I don't get it, but I'll send you one podcasts i don't rachel i don't get it but i'll send you one i don't know

if i can watch it i feel like no it's a listening you listen listen okay yeah you don't want to yeah there's nothing scary you see you just listen to ready i got i got you something oh rachel cruz loves her a crime podcast jade warshaw other host, is fearful of them. But, you know, listen, as long as we're part of your daily routine and you listen to a little bit of The Ramsey Show, then go listen to a little bit of your other podcast. So, so funny. Well, anyway, my point was to tell you that we appreciate you and keep doing what you do.

We're going to go to the phone lines where there's Tony in Rochester, New York. What's going on, Tony? Hi. Hey. So I'm calling because I am quite a bit in debt. It's gotten to a point where after I pay my bills and subscriptions and things that I've got going on, it's the amount of credit card that I got, it's pretty much takes over the rest of the paycheck. And we're trying to manage it.

I'm looking at options. I sold a car, considering maybe selling a house. A house? Do you have more than one? No, the house. The house, okay. Selling the house and maybe using that to bring them down. I make about $100,000 a year. Is that including your wife?

I know about, what's that? Is the $100,000 including your wife? No, it's just me. Just you? Does she work outside the house? Well, that's our household. She's at home and I'm the one that's working outside. How much credit card debt do you guys have? We got about 126.

126,000 in credit card debt? Yeah. And what's the work? So, yeah, no, it's okay. I can hear it in your voice, Tony. I mean, it's hard. That's really hard. What caused, what was the reason for that?

Well, I was out of work for a year trying to figure out different things i attempted uh some things on my own as well i wasn't able to make enough uh to to get us uh out of you know to be able to sustain us for a long time start getting that uh starting getting uh credit cards to be able to manage. So I finally got a job, and then it's grown because once, I guess there's a point of you have enough debt, the payment gets you to a point where you can't make, what's left is not enough. So you've got to continue getting more and more and more and more.

We haven't been able to manage reducing the expenditures enough. So how long have you been in this job that you're in now? How long has it been? About a year. Okay, so when did you decide? When was the point for you that you were like, I've got to do something different. This isn't working.

Well, I'm looking at the numbers. I mean, a few years ago a year well for a while we've been wanting to do something but it's uh it's become quite urgent now so we're trying to figure out how much are you paying every month how much are you paying every month towards these credit cards probably 3,500 a little more 1,500 3,500 oh 3,500. Oh, 3,500. Okay. And is that... Minimum payments. That's the minimum payments. Wow. Yeah. And you mentioned a car.

Is it... Tell me about the car situation. So we have two cars. One of them, I ended up having to spend quite a bit in repairs and things like that. And I said, well, you know what? I got it really nice, but I didn't want to continue. And so I have another car that's newer and it's in good shape. I don't, I mean, I own loans on them. So can I, sorry, just to clarify. I only have the one car right now at this point. Okay. So there's one car,

the car that you said you didn't want to, know continue with what did you do with it do you still own it does it just need the repairs you sold it sold it okay so now you're a one car family there's one car family for now yeah okay and the car that you have what do you owe on it and what's it worth it's it's uh i owe about 30 000 on it it's probably worth the same amount maybe a little more it's fairly newer so it's kind the same amount, maybe a little more. It's fairly newer, so it's kind of... Okay. The loan's a little older than what that car is worth. So if I were to sell it, I don't know that I'll get my money back.

Yeah, you'd be underwater in it. And there's no... You have no savings, I'm assuming. Nothing saved anywhere. Not... Well, just a little bit. And I... Very little.

Okay. That's off limits. What I want to ask about, sorry, I'm going to pry, like I'm putting my crowbar in and I'm prying out. Your wife's a stay-at-home mom? Yeah. How many kids do you have? She's actually on the line too, she's hearing us. Oh, hey girl.

Hi. Hi. Hi. Hey, so you're staying at home,'re doing you know you're doing some heavy lifting um how many kids are you watching and taking care of three three and what's their ages we're uh already the our oldest one is 11 uh-huh andrea's eight and the the youngest one is six okay so when i'm listening to that i'm hearing school-aged kids which is great because that daycare you know bill is not a thing so my question is and you know i'm

i'm i'm going around this delicately but i think there's room that you can work as well because right now yeah the most money that you can bring in is what's going to break this cycle. Yes, yes, yes. I'm just trying to make smart choices. Like I was telling him, it's just difficult to sit down and search, you know, like a search for a job that is prudent in terms of knowing the hours, minimum per hour. And just with one car right now, we are managing.

So he takes the car for the most part right now or if not the bus. It is a bit difficult, but yeah, that is my main goal. Well, I always say get a job until you get the job because right now okay literally anything you do is going to help you guys out yeah if you drop the kids off and go work at a bakery you know for you know whatever it is like go yeah doing something because um and what's your name can i ask we have tony and and and i know you know it is okay yeah um it's not that i haven't tried i i've actually sure sure to come up like with uh on the side job like staging yeah because

here's the deal you guys i i know tony had mentioned or at least it's here on our screen um one of your biggest questions was debt consolidation and yeah here's what here's what i want okay so so here's the deal you guys what's going to fix this issue is you guys it's not rearranging this credit card debt and trying to find a lower interest rate that's not your problem the problem is is that you guys lived a cycle with your money that got you in this problem and in this mess. But the beautiful thing is, yes, you were the ones that got yourselves in this mess, but you're the ones that's going to get yourselves out of it. Okay. And so listen to each other because this is the stress point because you're starting to

make that turn of saying we're going to do something differently. She's looking for a job. You've sold a car. I mean, you guys are feeling this tension. You're starting to make these choices. You're getting in the right direction. So stay on the same team because Tony's not feeling great about himself. And when I heard you, when I heard your voice immediately, Tony, I thought he's caring so much. There's a lot of shame. Yes. There's a lot of guilt that you feel, Tony, like this was my

responsibility. I tried taking care of my family and this is what I got us in. She is supportive. She sounds wonderful. You know, she's wanting to help. But you guys together, you have to work as a team and stay on the line because Austin's going to pick up and we're going to give you Financial Peace University and Every Dollar Premium, which is our budgeting app. And you guys sit down together, go through these lessons, learn the basics because debt consolidation, that's not going to be your answer. Yeah, not the option. You are your answer.

You guys can do this. We take these calls every day and hear people that do their debt-free screams. I mean, Jade is a living testimony of this. You guys can do this. It's going to take a long time. It's a lot of sacrifice, but it is possible.

So I'm so glad you guys called today and we wish you nothing but the best. You guys can do this. Hey, you're listening to The Ramsey Show. I'm Jade Warshaw. This is Rachel Cruz to my right. And we're taking calls about your life and your money. Just came off of a call. And, you know, honestly, we get calls all the time of people, you know, they're in a hard financial situation. And, you know, we're asking questions and mining around to kind of figure out what's the core of the problem, where the problem come from, how can we go about a life that we're not repeating those mistakes again. And you kind of do have to dig in and each individual kind of

has to go back and do their own digging so that they're figuring out what happened here. Like, it's good to want to solve a problem, but you also have to go back and go, okay, but what happened? Like, what caused me to act in that way? What did I do that caused us to kind of spin out? And we try to help you guys with that a little bit. And some of that is personal work. But one of the themes that I notice, Rachel, is, and I get this, like this is not me pointing a finger. This is just, I think, a human nature thing that we have to guard against, which is, you know, everybody has work in the words of Ken Coleman that they were created to do. And everybody wants to find the work that they're created to do and the thing that gives them life and the thing that gives them energy. And I'm all for that.

You know, you want to be excited to go we don't love and it's not the job and it's not right. The one that we see throughout and even that I face throughout times in my life is five reasons to get any job. To go. Just to get any job. All right. So number one, some money is better than no money. That's right.

Right. Some money coming in is better than no money. When COVID hit, we were in the cruise industry and ain't nobody going on cruises and the live entertainment industry and wasn't nobody going to a live event. So I had to get a job and my husband had to get a job. I had to get a job that I did not like that. To be honest, I was over fully, fully, fully overqualified for, But we didn't want to just burn savings. So it's like bring in some money. Like we were debt free.

We have hardly any expenses. Any money that we bring in is going to be great. So we did that and it didn't feel good. And let me just say, I don't necessarily believe that work is beneath people. But in some days it felt like it was beneath me. Like, let's just be honest about that. Somebody needs to say it. You know, some of you feel like, listen, I don't, I shouldn't be working at McDonald's. Okay.

I get that you feel that way, but you don't have any money. So go work at McDonald's. All right. And listen, just be happy that McDonald's is open. Because back in the day, in COVID, it wasn't even open. So anyway, some money is better than no money. Rachel, the next one I have here is your spouse needs to see who you are. And if you're a husband or a wife and you're facing a very hard time in your marriage,

go get a job. Because when they see you at home and you're not working and they feel like they're taking on the burden of that, you can help take some of that off. So go get a job. And then that might encourage your spouse to go get a job like that is good. Your spouse will feel like I remember when I was a kid when I'm like my dad, he just was always working. And I was like, one thing about my dad is like this man is going to work like and it just it builds a sense of security in your kids and in your family. Yeah, go get a job. And and no one's going to be going, well, but my dad only works here. No one is saying that. They're going, listen, my dad goes out and works hard every day.

That's right. Go get a job. All right. Number three, you'll learn what you like and what you don't like. Yes. By testing out all different things. Yeah. Listen, I don't like food service.

I don't like call center. I don't really like working with animals, even though I like animals. Yeah, I like cooking. I don't like making wedding cakes. I've done it before. It's a lot of work. Like I can tell you, Rachel Cruz, the things that Jade does not like doing. Okay.

And now I know the situations that I do enjoy working in. So you'll learn what you like. You'll learn what you don't like. Number four, you'll be productive. Yes. And there's just something to be said for, all right, I'm getting up. And leaving and doing something.

Yeah. Or not leaving, but staying at home and being on your computer. Doing something. Yes. Something. You're getting out of your bed. Even if you're putting on sweatpants

and going up and putting your little headpiece on and doing your call center job. I'm almost talking about it like I know it. Okay. And then finally, it will build confidence in you because when you go, the longer you go without a job, the more you wonder if you'll ever be able to get a job. So to just go from one job to another says, listen, I've got some confidence. Like I can say when I go to my next interview, I can say that I'm currently working or I can say here's the experience that I've had. Yeah. Or at least feel it on the inside. Right. So there you have it.

Five, five reasons to take any job before you get the job. And that was free, ladies and gentlemen. Free game. Right. From Jade Warshaw. It's amazing, Jade. I mean, seriously, because I do think that there is this feeling, and especially if you've been in a certain industry or you kind of have your line of sight of like, this is what I do, and you get laid off or you're in a bad situation, you quit, whatever the reason is, and you still have that kind of narrow focus of this. And to your point,

when bills have to be paid, open those horizons and go. Just do something. Yes. Yeah. And, you know, one door leads to another. And you never know. You might be taking someone's burger order and you meet, you know, the person taking the order. They have a situation that they tell you about. And it leads to the next thing. You just, you never, ever know what's behind a door. So don't count it out and think that you're above it or think that it's, just going. Anyway, I digress. I gotta take a deep breath. I love it. We got to go to Brenda in Washington, DC. Sorry, Brenda, that you have to come after that, but what's going on in your world?

Hi. So, um, me and my husband are looking to buy a house. Uh, we want to know if we're even there yet. And if we are, what steps financially we should take to get there as far as pausing our investments, continuing to invest, or, yeah, what we should do. Okay. Well, what we look at, Brenda, is a series of steps that we want completed before you go and purchase your first home. So how much debt do you guys have? steps that we want completed before you go and purchase your first home. So are you, how much debt do you guys have? We have about, I think, $12,000 total for our cars and that's it. And that's it? Okay, perfect. And do you guys have any money saved? We have about $55,000 in savings. Okay, that's great. How much do you guys make a year?

Combined, we make around $220,000 before taxes. I don't know what it is after, to be honest. Yeah, okay, perfect. That's a great income. Okay, so if I were you, Brenda, I would pay off your cars today with the money that you guys have saved in that $55,000 account. And then the remaining,

I would look to see how much your expenses are a month. Because what we say is after you pay off all your consumer debt, look to get a three to six months of expenses saved in a fully funded emergency fund. And you can put that money in a high yield savings or a money market. And for you guys, you may want to put some more Towards savings Once you pay off the cars Or maybe that's enough for you guys But I want you guys to look at your own budget And figure out okay if we need probably three months

Do you guys have kids? No we do have a kid on the way That's part of our We want to buy a house too That's so great well congratulations When are you due? September Oh, okay. And we want to buy a house too. That's so great. Well, congratulations. When are you due? Yeah, thank you. September.

In September. Okay, that's awesome. So yeah, so I wouldn't push the timeline of the home with or without the baby, okay? So meaning like I wouldn't feel like, oh my gosh, I have to get in before the baby or I wouldn't let the baby's timeline dictate your house timeline. I want your get in before the baby or what I wouldn't let the baby's timeline dictate

your house timeline I want your money to dictate the house timeline so again I want that fully funded emergency fund and honestly Brenda with the baby on the way you know starting to look for a home I would I would feel comfortable around that five to six month mark for an emergency fund and just making sure you guys have plenty of cash set aside and then you want to start saving up for your down payments and i would say to put at least five percent down and make sure your payment is no more than 25 of your take-home pay so when you run those numbers you guys can kind of look now you're in you're in the dc area so you're in an expensive part of the country real estate wise so your expectations and our formula, we get knocked on it sometimes.

It is more on the conservative side, but I don't want this house to be the thing that stresses you guys out. So it may take maybe another year or two or depending on what kind of house you guys are looking at to really kind of slow down and say, yep, let's get in a good position, have a good down payment

and making sure that it's a reasonable payment within our income to make sure to pull the trigger. So I hope that's helpful, Brenda. And if you go to ramseysolutions.com, we have tons of articles and free content on home purchasing. So make sure to check that out. You're listening to The Ramsey Show. Hey, by the way, a couple of days ago we did a q a after the ramsey show all on budgeting and it was it was really cool it was live it was george and i here in the studio it's still on the youtube page if you want to go and check that out if you have any questions about our budgeting app every dollar which is the best budgeting app in the world. We did a live Q&A where we had EveryDollar pulled up on the screen. George and I were just kind of little characters

in the corner so you could really see how the budgeting app works. And we answered, Rachel, gosh, probably eight or 10 questions in depth. And I mean, it's questions that most of you have all the time. How do I do sinking funds? What do I do if I get paid four times a week? Do I do my budget by week or how do I do it? We answered all those questions. We talked about, gosh, paying off debt, so many just everyday questions. So if that's something you're interested in, find it on our YouTube page. I'm sure they'll pull it up at some point or maybe even after this segment. So stay tuned for that. It's so valuable. There it is. It was really, really cool. I think like over, gosh, the numbers on it were crazy. I'm not going to sit here and try to quote it. But my point is, go watch it because it was super duper valuable. And I'm

sure that we'll do that again. I don't know when, but it was super valuable. So go in there, every dollar again, such a great budgeting tool. But like, let's be honest, there's sometimes questions that you have and things that you want to know about it. And so we're here to answer those questions as well as questions about your life and your money, which we're going to do. The number is 888-825-5225. We're here to help. And let's go to Jerry in Phoenix, Arizona. What's going on, Jerry? How are you doing? Thanks for taking my call. You're welcome. How can we help? My question is, I'm 66. My wife is 71. She's been

diagnosed and said dementia for three years. I'm sorry. She's close to having to go into a long-term care facility. I've done the baby steps. I have like $5,000 in emergency fund and $20,000 in savings and investing. My house is paid for, but my question is, should I sell my house to pay for her long-term care, which I can't afford on my income? How much does the long-term care, how much is it costing you? Like what's the cost per month, per year? Cost per month for long-term care is about $7,000 a month, and I take home only $5,000 with my retirements. Okay. And are you retired, Jerry, then?

Yes, I'm retired, military, disability, and Social Security. Okay, okay. So tell us more about your home situation. Okay, I own my home. It's worth about $700,000. I could sell the house here and move into a smaller house for like $400,000. It would leave me about $250,000. And I could use that to pay monthly on long-term care, memory care. That would only last for maybe two years or three years. Assuming it's not invested.

What's that? The house? No. The $250,000. Are you just thinking of it as a lump sum as it is? Yeah, it would just be my equity out of the house after I sold it. And tell me again, sorry, I was kind of writing down some things. Tell me again what you have in retirement as it stands. Okay, military retirement, military disability, Social Security, and my wife's Social Security. And it adds up to about $4,800 a month.

But what are the nest eggs? Is there a nest egg anywhere in there? I've got $20,000 in the savings account and $5,000 in another savings account for my emergency fund. Okay. Let me think here. We're trying to get everything right and the house paid off. Yeah. Getting there, but then this happens.

Yes, I'm so sorry. And, Jerry, I mean, I'm assuming because you called and asked this specific question. I mean, so she will need to be in a long-term care. Yeah, she's getting to a point where I'm not going to be able to take care of her at my age. I'm doing full-time caretaking for her right now, but I'm just trying to look into the future, and I know it's not going to last forever. Yeah, I know.

Oh, I'm so sorry. Have you looked um, have you looked at other options at other, whether it's, you know, homes or facilities or even in, in home care at all? Um, yeah, I have looked at it. It's a little bit cheaper, but not, not very much. Still going to be about 5,000. Okay. More than I000 more than I take home. Yeah. In this case, though, a $2,000 difference is a big difference from $5,000 to $7,000. So it is something to consider. Okay.

Yeah, I thought about that because the house that I have now, well, I'd have to sell this house. That's all. That's the only thing I could think of to be able to have money to do anything yeah I mean I do think so yeah it's it is it's a large asset it's paid off which is just incredible

and I think it is you know that I you know you need money for her right and so you do have a stream of income in a sense with this I mean not income but you have the ability to get some cash if you do sell um this home um what would it look like you you ran one scenario where you sell this seven hundred thousand dollar home you take 250 you invest it well and you're pulling

off of it for a number of years to only fund it for so long. But that's with you buying a three or $400,000 house. Is there any situation? It's just going to be you in the home, possibly, depending on which route you go. Is there a route where you buy something far less expensive, like a condo, as opposed to a full-size house, even though it would be downsizing, but something even smaller where you've got a larger nest egg that you can invest and draw off for a longer period of time. That's always an option. I know in the Phoenix area, even condos are getting up there price-wise. Yeah, for sure. Yeah. Yeah. I mean, Jerry, I'm so sorry. I mean, I probably would.

Yeah, I would look to probably sell. And I think you do have to map out. Because what I don't want to happen is you sell this paid off asset and... There's nothing left for you. There's nothing left for you or you end up running out and then you have to go to another option, right? And so, yeah, I would run the numbers pretty tightly I probably wouldn't rush into buying something new right now for you as you go and I would look at other options for care care as well I mean obviously we want the best for our loved ones for sure but that industry can vary so so much and you guys obviously you

don't have she doesn't have long-term care insurance or i mean anything right okay i never planned for i wish i would have no i know i know well and and she's so young you know it's just um i'm so sorry you you'd invest the money if you sold the house and then try to take the money out of the investments? Or how would that work? Yeah, I probably would try to take away as big a chunk as possible. That's why I was saying, is there a way that you can do a situation where you're taking the majority of the sale of this and investing it? Because then what you're drawing off of it is much less and you would only draw off what you needed to fund this since you're living since you already have some income of course coming in from all of your different retirement options you

wouldn't have to pull much i mean we're talking about you said you bring in five thousand this is an additional seven to five thousand so it'd be you coming up with a retirement option where it allows you to pull off five thousand and you're dwindling that nest egg far slower than if it was a $250,000 nest. Like going in with $600,000 or $700,000 is a lot different than going in with $250,000. So to Rachel's point, like I hate the idea of you being a homeowner and then you not being a homeowner anymore. But I would love if you worked with a professional to see what your options are because A, I want you to be able to take care of her but b you're not getting any younger either and so there's got to be a situation

where you're covered as well and that'll just at the very least having your options will really just help give you peace about okay this is this is what i know i can do here are my options it's not floating around in my head and being able to choose between a couple of things on paper as opposed to just thinking, all right, this is my only choice. I can only do X. That's right. That's right. Right.

So that makes sense. Talk to a fellow investor. Yeah, we have SmartVestor pros. You can hop on RamseySolutions.com and check out our SmartVestor pros. And they're going to help you really see, OK, here's what we we can do and they're going to shoot you straight and tell you what your options are and again that's going to help give you a very clear picture of what your choices are moving and how to stretch this money out as long as possible jerry right i mean i think that's that's going to be the goal to make her comfortable to make you feel good about the situation but how

can you do that while balancing you have a chunk of money and how can we, how can we get that to go as far as possible? Yeah. Tough stuff, but you know, there are options and the more knowledge is power. That's what I was trying to get to at the end of the day, knowledge is power.

So go out there and see how those smart investors can help you. This is the Ramsey show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. I'm your host, Jade Gorshaw, joined by your other host for the day, Rachel Cruz, taking your calls all afternoon long. Your life, your money, we want to hear about it. The number is 888-825-5225 and we will get into it. So, you know, come ready because we're going to give you our thoughts and our advice on it. All right. So let's go to the phone lines where there's Vanessa in Dallas, Texas waiting. What's going on, Vanessa?

Hi, ladies. Thank you so much for your time today. No problem. Absolutely. I'm so glad it's the two of you because I really, really want your opinion. I just got engaged two weeks ago. Congratulations. Thank you so much. We don't have a date yet. We both rent separately. We're both completely out of debt. No secret credit cards, nothing like that. Nice. And I was just curious, what should we prioritize first? I'm really, I'm one of those soon to be brides where I care more about getting into a home rather than a very large, expensive wedding. And I just, I feel like I'm suffering from paralysis of the analysis and I don't really know where to go from here. Okay, good question. Oh my gosh.

So for you guys, the wedding, is it you guys paying for it, you and your fiance? Yes, just us. Okay, and how much do you guys make a year? We both make 65 respectively, so altogether 130. 130, okay. But we haven't combined any finances yet. Yes, oh, you're good.

Vanessa's like, I swear we're doing this way i know i love it um okay do you guys have money saved what would be the money saved to if you were to combine savings not like you're going to but if you were what would that be at this point we both have a fully funded six month emergency fund and that is it like we we paid off all of our debt saved up baby step three all of that and then he popped the question so we're really like we're basically starting from um like baby step three b slash wedding fund yeah so you both have a six month emergency fund separately correct awesome okay so how much how much is in how much is in, how much is in yours? How much is in his?

Mine is, since we make the same amount of money, like it's right in the neighborhood of about $20,000. Each of you has. Okay. Correct. Okay. That's great. Yep. And I would, I would leave that alone. Yeah. I would keep that as is. And okay. What is his take take is he more on the house side or is he at all have any i don't know i feel like dudes don't really care about the wedding as much usually stereotypically yeah i would think so he's kind of torn as well because um he was raised catholic so his his his family's um approach to everything is like try to get married in the church, which is I know is around like $10,000 to $15,000. But if it, I mean, at the end of the day, we're both sort of like, what if we just went down to the courthouse and could be done with it then? When you said that, like, are you saying that the church is more expensive than like another venue? Because I always feel like the church route is less expensive than like a ballroom, right?

So the church comes with a lot of like prerequisites that you have to go through like marriage counseling which is wonderful um and like things like that um i think it just sort of as like all encapsulated is about 10 to 15 000 like we would be able to do it probably for that much money. Okay. But you guys don't want to do that necessarily. Not necessarily. Okay. And you don't have to. Yeah.

I mean, I would lean on what you guys want. And it sounds like, Vanessa, unless I'm mistaken, that you both lean to like, hey, let's, I mean, it's, I mean, you could do a lope. You could go a step up from a lope, get the license, go have a great party. Yeah. Like treat it like an engagement party. Yeah. Yeah. Have a great reception at some date date you know later in the future um but it sounds like your priority is because of how i mean i can tell how focused you guys are um is really looking towards

the future and looking at like hey what's going to last us longer and saving up more for a down payment on a home is quote unquote technically a better financial investment I won't necessarily say emotionally and all the things but like I do think whatever you choose you have to make it a memory like you have to yes do something that makes it like special like if you say okay we're just going to go down to the courthouse right now in your life you're really um focusing on the financial thing but there might be a point later on where you see something or something sparks i wish i had done a couple of things yes um there is part of that that i think that she should

include or you know that you should include vanessa even though even if you choose to go like the the do the least route right like still have a beautiful dress still do something that's going to create a memory in your mind where later on you will look back and not feel like you missed out because you still did yeah something and it is interesting because these types of situations and you could probably put vacation in this realm that i'm talking about or other things it is so personality driven i had a cousin and they went to Washington literally went to the top of a mountain had a pastor do it and they were done that's cool like that's all because that was like their thing and they're like that's all we want we don't need a bunch

of people around we're good uh you know and then you know for me I'm like I love I love a good party and I love dressing I love all the things so So I'm like, I would tend to lean, which I did. I enjoyed my wedding and I loved it. But all that to say, your personality and what you guys want and what you guys value is going to drive this. And so maybe, Vanessa, it'd be a fun exercise to write down maybe three things for you in the wedding category that you would genuinely love to have. And maybe that's the dress

or maybe that's a really good idea yeah and just the idea of like what three things are important to you what three things are important to me and like see what we meet in the middle and you guys may yeah be be very similar in it and we i mean we've talked to some people on the show they do it so inexpensively yeah have a great time and then they they write off in the sunset and and you know do it and then we know some people too that are like no this is an important day for us we really want to take the most of it yeah and we're gonna save put more money here and we'll worry about the house in two to three years you know so yeah i don't think there's a right or wrong honestly i think going into debt yeah or making decisions like that I think are will put you guys back but I

really think that it's a lean into what you guys both want not what everyone else around you is saying so true and listen there's two like thinking of towards the future there's two ways to think of this number one I Rachel I think in some ways I'm like you, which I like a good party. Probably not to the extent because I love my wedding. Like I have great memories of my wedding. It's not something I think of all the time. And so I do like to, you know, when people call in, I do like to call out like, listen, it is one day and you're not going to think about it all the time. That's right.

And the flip side of that is Sam and I are big on like renewing of vows. So it's like if you don't do everything you want to do the first go round, listen, in 10 years, renew your vows. It'll give you something to work towards. My husband and I did a vow renewal at 10 years and we're going to do another one at 20 years and each one will be nicer and better. Come on, listen.

So just understand like there's, you have room to go up and. That's a great point. Yeah. That's a great point yeah that's a great point i love it i like that conversation yeah congratulations vanessa i feel like you guys are making the right decision i'm not worried about you guys you're pretty pretty strange the straight line when it comes to the money 100 do you remember there was a netflix show that was like the people had the opportunity to choose between. I think it was $10,000 or $30,000 on a house or a wedding. It was a great concept. And that's basically what that call was.

But do remember, your wedding is one day. Your marriage is a lifetime. So do the marriage counseling beforehand. Do it in a year. All the things. It is one day. So don't get too caught up in it. This is The ramsey show all right you're listening to the ramsey show i'm jade warshaw this is rachel

cruz host of the rachel cruz show on youtube if you happen to be on there also smart money happy hour is a great one um listen rachel this kind of came up several months back. I saw an article where they were just talking about more and more people drawing from their 401ks and from like their actual retirement to cover month to month expenses. And of course, we've all seen in the news, like the extremes where people pull from their 401k to go see Beyonce or to go see Taylor Swift. Right, right, right. But they're and don't do that. That's terrible. But there's a lot of folks out there who are kind of facing that paycheck to paycheck cycle. They're feeling the stress and the strain of their money and they don't know

where else to go. And they're thinking, is it better? You know, I don't want to put this on a credit card or I don't want to take out more debt. Here's money. That's my money. Yeah. Maybe I should take out from this money and I can, you know, make my situation better. Matter of fact, the guy called the show the other day. He had just had his taxes done and the fee for the taxes was $300. But his return was only $100. And he was like, oh, crap. Like, I thought I was going to be able to take some of the money from my return. And he's thinking, like, maybe I'll just go to my for. Matter of fact, the tax guy, not not one of our trusted pros, but the tax guy that he was working with told him, hey, why don't you go to your 401k and take out a loan? So people are

just tossing this around as an option, like it's just nothing here. And I need people to understand that if you withdraw from your retirement, you're going to have to pay a 10% penalty on that money that you take out. And by the way, if you happen to draw from your 401k, if you lose your job, that money becomes due almost immediately. And you've got a year to pay it back before you start facing more fees and penalties. So this is more serious than what people really are drawing into it. It says, I'll get to that part in a minute. But what I want people to, I read an article that said the average withdrawal, Rachel, is about $5,000.

Like people aren't looking to get $30,000. It's not tens of thousands. No. On average, it's five. It's $5,000. And do you know what I figured out, Rachel? That if you took a less than average car payment, that's basically the $5,000. Like if you went a year without your car payment, you'd have the $5,000.

For sure. Or you did a side hustle for $1,500 a month. Yes. You could get it. Yep. So I kind of want to have some empathy for the fact that people feel like they're faced against a wall, right? That there's No other thing but what I want you to see is

Listen start looking around because there's There's other options and avenues For you to get out of this well and in that case It's it's such a We see this all the time if you're in a crisis Or you feel like you have no options It feels like this is the only choice this is The only money I have so even

If it's three thousand five thousand dollars i'm gonna i'm gonna do that and it's such a short-sighted view versus pausing letting the chaos settle right and actually formulating a plan and when you actually start looking at other options so it is that that quick kind of grab of like oh my gosh i gotta just yeah yeah have it it's it's tough and some people are like, listen, I'm having a hardship. And there are, you know, there are hardship withdrawals. Hardship means that it allows you to take money out of your 401k to meet an immediate and heavy financial need.

That's what the IRS says. Immediate and heavy financial. And so many of us would look, could look at that and go, listen, I needed those Beyonce tickets. Whereas others will look at it and go, okay, yeah, I've been without my, you know, I've been without a job for X amount of months. Or, you know, what we're saying is this could include something like a natural disaster, right? Repairs from a natural disaster, covering funeral expenses for a loved one, or paying rent to avoid being evicted. Like those are really, really serious situations. You're only

allowed to take out the exact amount that you need for those expenses. And remember, you'd still have to pay taxes on it. So there's really no way around some of the financial strings that are attached to this, even if it was a hardship withdrawal. And again, we're seeing that these are on the rise. Unfortunately, more and more people are lying about their situation, Rachel, to qualify to get it, which is fraud. That's fraud. Yeah, that's legal. Yeah, we don't want to do that. So what we just want you to take away from this is, A, don't lie about your situation and don't commit fraud. But B, understand that there's always options. There's always a way that is better than probably what you're scared and anxiety-filled,

sleepless brain is coming up with in the moment, right? Yep, that's right. Because when we're panicked, we're like, okay, what can I do? What can I do? And your brain just fixates on one thing that usually feels like the easiest answer, that feels like the answer with the least amount of friction. But a lot of times it's not the best answer. Like it might be what we talked about, You picking up a side hustle in the midst

of an already very busy schedule. You selling a car and having to coordinate with your spouse a one car situation when you've had two cars your entire marriage. Like no one is sitting here and saying that that wouldn't be difficult or very hard to pull off or require tons of coordination. But it's bigger and better than borrowing from your future. Because what happens is when we pull from our retirement, it does draw a line in the sand of, okay, this is something that I have the option to do. And once you start that, it's kind of like you've said, this is available to me. And then the next time a hard situation comes, that's an option that you know

you did in the past. And so it really is about building the right behavior over time, Rachel, for me. Totally. Because it fixes, like you said, the issue in the moment. But man, it takes away from so much growth that could be happening. So do you make the sacrifice on the short term? That's why we tell people not to take money out of your retirement 401k or Roth or IRAs to pay off debt, because this is something that you can do on your own without that money. Because again, you lose so much,

so much growth when you do that. So if you want to know more about this, we do have a really cool article. By the way, we have tons of articles on ramseysolutions.com, but we've got one here that's called why you shouldn't withdraw from your retirement to pay off debt.com, but we've got one here that's called Why You Shouldn't Withdraw From Your Retirement to Pay Off Debt. There's a nice ring to it. There you go. But it's at RamseySolutions.com and the link is there in the

show notes. So take a look at that. It's just, listen, knowledge is power. The more you know with the little rainbow at the end. So with that, let's go to the phone lines. We've got Caden in Boise, Idaho. What's going on Caden? Hey there how's your guys day going? Great how about you? Terrific so I got myself into a little bit of a pickle. I'm 22 years old. I make about $80,000. I made $80,000 last year. I'm planning on making $100,000 this year. Nice. And I am roughly $280,000 in debt. That includes a house, a car, a motorcycle, and other miscellaneous like credit cards and stuff. How much is the house of that debt? The house is $225,000.

Okay. And go ahead and just tell me the rest of them as well the car uh car is four thousand uh motorcycle is 12 um and then credit card is another four and then i have a four thousand uh home improvement loan for an electrical situation that had happened. And that's four as well. Listen, I think you do have some debt here that I think that you'll be able to clean up relatively quickly. I think because you're grouping it in with the house, it feels even more overwhelming. And that might be because is your home payment too high for your income? What's your home payment? payment is uh i have a first and a second mortgage i went through fha so they

the down payment assistance um okay first uh first mortgage payment is uh 1750 second is 100 okay so you're paying 1850 and what's your take-home pay? Roughly, I work hourly plus commission, so it varies, but anywhere from $4 to like $7 each month. Okay, so I think on most months you're fine with this mortgage. If I were you, I mean, the way we teach is the mortgage is completely separate from the rest of the debt. And I think if for right now, while you're in baby step two, which is paying off all of your consumer debt, except your mortgage, I think that'll break it down into like more manageable bite-sized pieces.

Um, do you have any money saved, Caden? Um, I do not. Okay. Yeah. So, um, If I were you I would probably Sell the motorcycle I would look to say

Okay then that That takes a That takes a good chunk off Then we got 12,000 left Between the other The 4,000 car 4,000 credit card And 4,000

On the electrical issue And I would just work To pay that down Caden I mean I would I would work extra I would just work to pay that down, Kaden. I mean, I would work extra. I would do what you can. I mean, you're 22. If you get all this stuff cleaned up, it's amazing what can happen when you don't have all this debt.

And I would cut up the credit cards and I would really start living a life to say, okay, I'm someone that doesn't use debt. You pay it off. You save up an emergency fund. And Kaden at 25 is going to be pretty dang in a great situation. You are listening to The Ramsey Show, and thank you for listening to The Ramsey Show. I'm Jade Warshaw.

Joined next to me is Rachel Cruz, and we're taking your calls for the rest of the hour. So you can give us a call. The number is 888-825-5225. I mentioned it before and I'll mention it again. We are doing a really cool live event coming up May 10th and 11th here on our campus here in Nashville, Tennessee. It's the Total Money Makeover weekend. So it's over the course of a couple of days. You come up here on our campus and we are going to walk through really what? It's about is it's based on the book the total money makeover

So that's the baby steps And so basically everything you hear is talking about on the radio If you want that deep dive if you want to be around like-minded people You want to just get into it get that deeper level be motivated. This is the event for you All the personalities are going to be there If you've been to a live event before this is not going to be like the one you've been to this is the event for you. All the personalities are going to be there. If you've been to a live event before, this is not going to be like the one you've been to. This is completely different.

So if you want to get those early bird tickets, they're $99 and they're only going to be here for a limited time. So you can get those at ramseysolutions.com slash events. And we'll see you there without further ado. All right, let's go to Rachel, who's in Spokane, Washington, the city I was born in. What's going on, Rachel? It's a pretty all right city's go to rachel who's in spokane washington the city i was born in what's

going on rachel it's a pretty all right city i'll say that um hey what can we do taking my call um i would love some advice i um it's sort of financial related kind of not my finances but i am 32 years old and i'm an independent parent, which means like I chose to become a parent by myself after, you know, I was 25, 26, 27, couldn't find anyone. We never aligned with like finances or like financial ideology or having children. So three years ago, I decided to have a child on my own. I love my daughter. She is the best. Oh my goodness. Um, I, so I feel like I really made some good decisions and she's a little older now. She's four now. And you know, a lot of friends and family are always asking me like, you should start dating soon. Like why, why aren't you going on dates?

Like, why are you not doing this? And a really big reason. So I'm 32. I don't have any debt. I don't have any credit card debt. I paid off all my loans, credit card debt, car, all that when I was 26, five, six. Um, and a huge reason is, um, uh, kind of a feeling of, you know, there's the obvious, you know, not just like letting anyone around my daughter, not just like in a, you know, I don't want to, I there's, there's that reason. But the reason I'm calling is that my friend set me up on a date with one of her work friends or something, her husband's work friend. And we were just chatting. He's like, how do you do it? How do you like single parent?

It must be so hard. And I was like, oh, well, like I don't live with debt. I like my job. Like it's not really that hard. Like it's hard if you are like if I'm like very financially stable and he um he was like oh I have like I'm like 450,000 in debt and like all these things and started just kind of naming him this is my first date with this person and I was like oh I know a lot about you um and what we say not to do on a first date I know well at least now you know yeah and I was like

maybe this is my fault because I was just casually just trying to like keep it light hearted. Like, oh, I don't live with that. But like me, it's been so long since I've lived with that. But I was like, maybe this maybe feel just like talking about this. Yeah. Yeah. And then I was talking to my friend. She's like, oh, like how to go. It's like, you know, I don't really think this is like for me.

And I was explaining like it's not just about introducing someone to my daughter's life. It's also about introducing that whatever like sure yeah I'm not going to date without the intention of marriage and sure um and I don't know how to explain and I don't even know if it's wrong to like not give somebody a chance knowing that they're so we're on totally different pages and you get to set your non-negotiables listen you get to set your non-negotiables you get to have that list of here are the things that I really at this point in my life want to align on and you get to say what that is and you also get to reevaluate that with time like listen you could come up with a list of five things and if you find out that after 10 years no one is meeting up to your expectations you get to decide

well maybe I am being a little too right like maybe, is there anything that I can change? Or is there anything that I'm being a little too judgmental on? And having, listen, you guys talked about this really early in the relationship. Had you have, had you have dated for four months and fallen in love and then him sprung on the $500 hundred thousand dollars of debt or however much it was. Listen, you might have married him anyway, like I did. But yeah, so I think Rachel, I think you have to you know, I would go into it and I wouldn't I wouldn't put this thing out there that if if they do have debts it's a it's an absolute no and i'm not saying you're saying that but what's important is the value system right so if they came to you and was like oh my gosh i still have a hundred thousand dollars of student loan debt and i hate it i don't want to you know this i feel this burden i'm trying to pay it off like

that's somebody that you're like okay i can get on the same team we are we are running in the same direction and i think the same would be true you know for a spiritual aspect how you want to raise kids yeah um you know I mean that in-laws and family like these are big topics in life and when you marry somebody those topics collide and you're not always going to be the same person you're not going to marry the same the clone of you right so you're going to probably always have a different take a different spin on these things but at the overall direction is what you're looking for so yeah i don't i don't think i wouldn't find someone really attractive if he's like i got 450 000 in debt i'm about to go buy another property and keep leveraging myself i'm like that's great for you but that's just not

attractive to me like i can't you know and i would say the same thing lines like that with in a spiritual sense or with kids like right there's things that you're just like we just won't be aligned in life so I don't think you're being too picky I would I would say you know if you if you called and said yeah just because he has that I won't date him that's no I wouldn't say that that's yeah I would not go down that route but especially if they've been like and i want to get out of it right so it's all about where they're going and what the values are going forward but um but and i think everyone has kind of that one subject in life that they're really passionate about yeah with the other person right and so naturally yours might yours might be money rachel not from a shallow perspective but something that you really cherish your convictions and you

really want to partner in this. And I think that's big. The thing to consider, especially with the debt aspect of this is let's just say, you know, you've gone on four or five dates and it comes up at Applebee's and you start talking about it. Remember, there's still time like you're not getting married tomorrow. So if this guy has sixty thousand dollars of debt, there's time for him to pay that off before you get married. Like, does that make sense? Like if you're really feeling some type of way of like, man, I really sacrificed to pay off my debt. I don't know if I have the stomach to go through another 60,000. Just think about the fact that there's still a timeline,

like you're not getting married tomorrow. And you'll be able to see if this person really does show and prove what their values are because are they actively trying to get out of debt it has have has eight months passed and they've paid off nothing you know i'm saying like you're you're gonna see that come out in the wash so i i wouldn't get too too hung up on it um within you know the first few days or even the first few months necessarily if you're on the fence. Does that make sense? That makes sense. Yeah. I think that something was just like a bit of a flag. He was like, oh, I have all this money. I was like, but the government's going to cancel student debt. So that's fine. Oh no. Red flag. No, no, no. I feel

like that for me. So maybe I should have added that. And I was like, okay, there's one thing to like, no, you're at least, I mean, some people don't even know how much money they're in debt. But I felt really bad. I was like, I felt really shallow. And I know that it's one thing to ask for someone to not be in debt. But this is great advice. Thank you. I just walked away. I was like, I have no idea how

I feel about this. And I think it's, I think, I think give yourself some grace too, because $450,000 even if he's trying to get out, that is a, it's kind of a, I think give yourself some grace too, because $450,000, even if he's trying to get out, that, that is a, it's kind of a, you know, especially if it doesn't include a mortgage, that's a breathtaking number. So I think that's fair that you're like, oh gosh, you know, like that's a, that is a lot of debt.

And so, uh, no, I don't think you're being too judgmental. I wouldn't, I wouldn't count someone out just because they have debt. It's all about the value system and where they're going moving forward. And could you see yourself with them in the future? Right. If they're walking that, but that's separate. And Rachel's,

but you're, you're a very, I mean, to do what you've done, even with a child, you know, like a, what was she 30 years old?

And I mean, all of that, like you, that is a beautiful, beautiful thing. And you've made choices in life that are very mature and you've taken on a lot of responsibility in life and so i do think your husband has a high bar and i don't think that's a bad thing hey in the chat i would love when people get a chance to

put their their thoughts on this in the chat like what your non-negotiable is oh like dating yeah and we can talk about it at some point because listen, after paying off the debt that we paid off, if God forbid something happened to Sam Warshaw and I had to get out there in this, in these streets, if somebody came at me, I don't know if I could stomach. Even like 30 K would be like, no. So everybody's got their limits. That's fair.

Jade. I'd be interested to know what you guys think about this. Throw it in the chats and maybe one day we'll talk about it. This is The Ramsey Show. You are listening to The Ramsey Show, our scripture and quote of the day. My favorite, whoever picked this knows me, Galatians 5.1. It's for freedom that Christ has set us free. Stand firm then, and do not let

yourselves be burdened again by the same yoke of slavery one version says don't be entangled again by the same yoke of bondage oh love it in other words when you get out of debt don't go back in just putting that out there okay and then Janice Joplin says you are what you settle for oh booyah there you go love it oh that stuff. All right. Let's go straight to the phone lines. The number is 888-825-5225. If you ever want to give us a call, we're going to go to Eric, who's in Austin, Texas. What's going on, Eric? Hey, y'all. It's so great to speak to you guys. How are y'all today? Happy Friday. Ooh, thank you. Happy Friday to you. Oh my goodness, you guys. This is y'all today? Happy Friday. Ooh, thank you. Happy Friday to you. Oh my goodness, you guys.

This is great. Let me take a deep breath here. I'm kind of nervous, but hey, so I am calling because I started out kind of in a position like you were, Jada, and I had $215,000 in debt. And that was, I know, it was a lot. It was between student loans, two cars, a credit card, some medical bills and whatnot. But I'm down to about $77,000 now. Nice.

Yeah, I've been really building that snowball. But I've come to the final mountain here, that final amount of debt that I've come up to. And everything else prior to has only been like $10,000 or $20,000. And now I'm facing a $78,000 mountain. So my first question is, what piece of advice do you have for somebody that has been like really pushing and really going through this snowball method for the past couple of years? And it's just like, you know, you're tired. How many years has it been? I started this in 2020.

So I've been doing this for, we're coming up on four years now. It's been a lot. Listen, that is a lot. And four years is a lot. So congratulations. Let me be the first one to just kind of like clap you up and say, very good. The $78,000, what is that big chunk? What is it?

That's all student loans. That's all left over for my student loans. Yes, ma'am. Oh, I know the feeling. Oh, I know the feeling so well. So, um, the 78,000, let me ask you this. Is it one, like, I remember ours was one, one payment, like it was a chunk of, uh, 78,000, but if you looked closely, it was actually a bunch of little loans grouped into that one payment. Is yours like that? Mine is just one giant loan at this point. I think I worked with my parents at one point to just, what do we do? We consolidated from Sallie Mae into like another organization,

and it's just one giant sum at this point. With one interest rate and one account number and one everything, right? Correct. Yes, ma'am. Okay. So I'm sorry about that. That is tough. It's hard to see that. The good news is it's your last one. Probably another set of good news is how much are you able to chunk away at it every single month? Well, that kind of leads me to my second part of the question is I'm currently in Austin. And as you know, the tech industry isn't necessarily very reputable for staying consistent whenever it comes to jobs. So I've actually put myself into store mode because I believe that my organization will be doing layoffs here in the next couple of months. So that's my struggle is not only do I have this mountain in front of me, but I also have, you know, kind of put everything aside temporarily

before I can start paying my student loans again. So which I think is smart. It's probably smart for you to do that. I want to go back to your first question, which is, listen, I've been in this four years. What do I do to stay motivated right now? You kind of have a little bit of a I don't want to call it a breather because you're still stacking up as much money as you can. But what I think is really important and just for anybody listening, you know, we say all the time on here, the average person is out of debt, you know, in two years or less. And it's important to remember that there's people to the right of that average number. And my guess is, you know, if you continue paying off this debt that you might have another year or two into this so that you're going to be six years in, which I relate to. And I do think that for you and anyone

listening, you have to, have to, have to include milestones of your own, ways that you can celebrate, ways that you can, the way I describe it is like a humpback whale, right? A humpback whale is swimming along. He's swimming. He's going after it, he's doing what he, and every once in a while he jumps out and he just like has that moment of like, ooh, I can breathe and he goes back in. And I think that that's the way you have to navigate this because we say on here all the time,

beans and rice, rice and beans, gazelle and tents, you're not going inside of a restaurant unless you're working inside. And that's so, so true, especially when you're in that average. But once you cross over into the four and five year mark, true especially when you're in that average but once you cross over into the four and five year mark there is a part of this that mentally for your health like you need to go into a restaurant like and and be i'm being clear like i am not talking to the folks in

average i'm talking to my six-figure freedom folks who have this six-figure debt in this case 215,000 you're in this thing for an above average time, four, five, six years. You need to become a humpback whale and you need to jump out and you need to do, maybe you did save up cash to replace a beater. Okay. Like go ahead and replace your beater. If it's falling apart and you've got $8,000 in cash, do it. I remember Sam and I. This isn't a sprint. It's a marathon. Yeah, you're in a marathon. And let me just, for the people listening, some of the things that Sam and I did

in our debt payoff journey, which was seven and a half years, that was not paying off debt. A, we cash flowed another vehicle because it was time, okay? We did take a couple of very small trips, like weekenders to like, OK, like we're good. And again, this is at that four or five and six year mark. Right.

You just have to do something that you've said when we get to this point, we're doing that. When we pay off that next Sally Mae or Nelnet or Navient or whatever you have. When I get to 80,000, I'm doing this. And when I get to 100,000, I'm doing this. And when I get to a hundred thousand, I'm doing this. And when I get to, and so you have to set those milestones in there and set them ahead of time so that you don't feel the need to get sloppy. All right. So you've got 78,000 to go. I feel like in that 78,000, there's probably one, one medium to decent milestone within that. And you've got probably two years to go after a four year journey. Sounds like you've been hitting it pretty hard. So how much do you make a year, Eric? I'd make after taxes probably about $4,800 a month to about $5,000 a month. Okay. Yeah. So I mean, my goal is to go ahead. Oh, go ahead. I'm sorry.

No, you go. I want to hear what you have to say. My goal is to pay it off by the time I'm 30. Right now I'm in 28 and a half. And so I just, I really want to get after it. And I've been very gazelle intense about this. And I want to pay it off and I want to get rid of it by the time I'm 30. But, you know, it's just 77,000 staring at that mountain to me. And you're right.

I need to set those milestones. I guess I need to be a humpback whale in the situation. Yeah. And Eric, I like what Jade said. I haven't heard you say this before, Jade, but I'm like, that is so true. Be intentional with those milestone moments too, because I think there is a point that you're just so exhausted that you're like, oh, and there can be a sloppiness in the milestone celebration and you end up spending more than you think.

Right. Yeah. And so it's like you're being so proactive. It's part of the plan as you look out that you're like i'm planning for this at this date this is how much i'm going to spend here to enjoy this to get that breath of fresh air to keep on moving but when you get to the point of complete exhaustion sometimes then that's when you're like oh my gosh i'm gonna make you could make some poor choices out of pure exhaustion that's right you haven't planned for it yeah as intentional as you can be which kind of takes the fun out of it sometimes but like but it gives you

something to look forward to yes and it's not a trip to europe because i already heard i heard somebody thinking i can finally take that trip it's not a trip to europe it is not a seven day vacation last year what'd you say i said not me taking a trip to Europe last year oh listen I'm not gonna I'm not gonna go off because I don't know the details but my point is be a humpback whale and since you did take that trip to Europe this next milestone is not going to be quite as extravagant it's going to be you know I mean it's different for different people the things that you value um I know for me, it was including certain things that I had cut off for such a long time. Like I was like, listen,

I'm going to start getting my nails done again. Like I, it was certain self-care things that I was like, I'm not doing this anymore. And I've worked really hard. And so you have to be reasonable. And I mean, I can't decide what that's going to be for you on this phone call, but you have to be reasonable and figure out what that is for us we had one vehicle and the the windows were held up by shoestrings so it was like listen we've got the money saved it's time to upgrade the car and I remember calling in the Dave Ramsey show and saying to Dave can I do this and I think that's what happens and this shows me that he's in the right spot when you're just so in it that you don't even you can't see the forest for the spot when you're just so in it that you don't even,

you can't see the forest for the trees anymore. You need somebody to tell you that you can take a break. That's a good indicator that it's time to take a break. So good. Really proud of you. Good job, Jade. I'm glad you were here today. Thank you.

So good. I'm glad you were here too. Such good stuff. We have fun together. Again, Jade Warshaw here, Rachel Cruz, you were listening to The Ramsey Show. Thanks for hanging out with us and make sure you see us on down the line on the next ramsey show Hey folks, Dave here. You want to hear even more life-changing content from Ramsey? Download the Ramsey Network app so you can catch all your favorite shows all in one place,

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