The Ramsey Show - Don’t Get Trapped in the Cycle of Debt!

Episode Date: February 26, 2024

💵 Sign-up for EveryDollar today - The simplest way to budget for your life! Jade Warshaw & Dr. John Delony answer your questions and discuss: "How do I get my husband to contribute?" "How do I start investing?" "My kid won't pay me back the money I loaned him," "How can I get my car paid off?" "What should we do with our whole life policies?" "Should I talk to my wife's toxic boss?" "My husband has been hiding his credit card use" Support Our Sponsors: Eight Sleep Churchill Mortgage BetterHelp Zander Insurance Neighborly Next Steps 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 📊 For help with investing, Get connected with a SmartVestor Pro! 🏦 Take Your 3-Minute Money Assessment - Get a personalized money plan! 🎟️ It's game on! Get your ticket for Total Money Makeover Weekend.  🏘️ Buy, sell, and invest the right way using Dave’s proven plan. 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 work build wealth do work that they love and create actual amazing relationships I am Jade Warshaw one of your hosts for the day joined next to me is Dr. John Deloney. What up? Your other host for the day. That is his voice that you hear if you're listening on podcast. And hey, if you're listening on podcast, try checking out the YouTube show because it's amazing. But if you want to talk to us, give us a call. The number is 888-825-5225.

We will chop it up. We'll talk about your life, your money, and the good doctor is in so he can talk to you about all those things that involve relationships and mental wellness. Love it. John, let's get to these phone lines right away, shall we? Let's do it. Let's go to Brian in Los Angeles, California. Hey, what's going on, Brian? Hey, how's it going, guys?

Thank you for taking my call. So I got a quick question. I'm on baby step two. I have one credit card left with about $12,000 on it. And then I have a car loan with $49,000 left on it. My wife suggested we refinance the car loan when we're done with that other credit card to try to get the payments higher and paid off sooner. But once we're done with that credit card, I believe we might be able to see double or even triple what the payment is.

Right. I was thinking of what would be the best option for that car loan? I think you're right. I think you've got the $12,000 and the $4,900. You do them in order. You pay off the $4,900, and when it comes time to do this $12,000 deal, you just pay as much as you can as fast as you can. Why does she want to refinance it?

Does she want to lock y'all into higher payments like that? Does she not trust you? No, it's actually 49,000 that we just got this car last year. Oh, 49,000. Yeah, 40,000. Yeah. Why don't you sell this car, dude? Well, it's the only big car we have. We've got five kids and it's a Suburban. What do you earn a year we well monthly we bring in about 10 000 net me and my wife what do you earn a year uh well see last year we didn't earn much because we were both i'm currently on um what's it called uh workers comp my wife was a maternity leave so we made in like we bought in like 50 something last year 40 something okay but uh our regular pay we bring in like a hundred and something thousand 120 120 is this your only car no we have two other

cars that are paid off two other cars paid off and what are they worth yes um one's about seven thousand the other one's about nine thousand okay you had to go out and get a real nice car, didn't you? No, we just needed it because we've got five kids. We don't fit in those smaller cars. I think that you're half right. I think that you need a vehicle that fits the size of your family. But I don't think that it has to be a $50,000 car. Here's my rule of thumb here.

Technically, there's two rules to kind of think of. Number one, you don't want your vehicles to be more than half of what you bring in for the year, right? And you're under that for the most part. I understand last year was different. So for the most part, you're under that. But then the next rule of thumb is, can you pay it off in two years or less? And in your case, I don't think that you can. And you've got another $12,000 of debt laying around. If you wanted to make and simplify your situation right now, it would look like selling this $50,000 truck or van or whatever you're calling it

and downsizing to something that's way used and way cash. Like, dude, just rolling down the streets, not smoking endo, but just riding a minivan. Sipping on grape juice. Laid back. It would be not cool at all. At all. Not cool. But it'd get you out of debt. There's no way you're

going to do it. I know you're not going to. I know you've got a $7,000 car, $9,000 car, and you've got this nice Suburban out there. You can fit everybody in it. You kind of feel like a little bit of a miniature baller. You're not going to sell it, but Jade and I are both telling you this would be a way to accelerate freedom in your house. Well, what if I'm upside down on it? How upside down? It's not worth about, I think it's like $7,000 or $10,000.

Sweet. Take one of those cars out of the driveway that's just sitting there. You have options. Yeah, i was thinking of that doing that sending one of the cars that we do have that paid off that's that's exactly what i would do and and then to get out of it don't paint yourself into a corner i think you've kind of said we need this car this is the only car we can get and maybe i won't sell the car because i'm upside down so we're just kind of showing you that there's lots of options here for you. The $7,000 car, what type of car is it? It's Infinity M37 2011. Okay. I put that up and have it sold by this weekend on Facebook marketplace. Have it gone. Take that cash in. I mean, that would more than wipe out half of your $12,000 debt, right?

Yes. And that's one last credit card that we just have. We've been doing your baby steps. We've pretty much paid off like seven or eight credit cards already. So this is just the last one that's worth $12,000 right now. That we owe $12,000. Think about this if you decide to hang on to that Suburban. By the way, I love Suburban.

It's a great car. I love them. Yeah. You're going to work real hard over the next 10 months, real hard, and you're going to pay off about $10,000 of that car. Okay. And that's about what it's going to go down in value. Yeah.

It went down already. You already felt it. I know. So all this work you're throwing into it, it's like you've got a shovel and you're filling up a hole with sand, and the hole's getting deeper from the bottom. Okay. You know what I'm saying? And eventually, you're going to depreciate the whole thing out, right?

So you can buy a Suburban with like 150,000 miles for like 20 grand. I mean, at some point, it's just going to be 20 grand forever. What Jade and I are saying is sell this one and go buy one that somebody else funded. Like somebody else paid all the depreciation on it. Yeah. And it won't be as nice, dude. It won't be as nice. It won't be as fancy.

It won't be. And Brian and his family will be free. That's the plan. I'm going to put this in. I'm going to put this. John just laid it out in the best terms possible. I'm going to put it in even more relatable terms i want a suburban like i either want a suburban or an escalator or a tahoe like a nice one right um i can't afford that right now and so i have a

2012 tahoe xl it's. And it's just as big. And I bought it in cash. It gets us around. And from the outside, it's way nicer than my car because she actually takes care of them and washes them. It's fine.

But only Jade knows. I saw it. I was like, man, what are they paying these new personalities, man? She must be rolling in here. It's a 2012. She takes great care of.

It looks fantastic. Yeah. And my other one's a 2013 Cadillac XR. I don't even know what it's called. It'd be nice to have a 2018 is all I'm saying or a 2020. But that's not a huge priority for our family right now. One day we'll get it and we'll pay cash one day soon. And my point is, that's what that looks like.

It's this place in between where you're able to pay cash. You get as close to what you want to get. And here's the thing. I don't have a car note. I don't have an $850 car note. So we can save up that money really, really fast if we want to. And what's your car note right now? It's $824 a month.

Brian! Buddy! Wow. Hey, can I tell you the most annoying part of all of this, just globally speaking? And I say this because this is how families get trapped. Jade is going to buy your Suburban from you at some point. Hey, okay. And she's going to buy it at a $10,000 loss to you.

Right? So because she bit the bullet for two years and saved cash, she's going to buy your car from you less than you paid. I mean, she's going to end up making money off it. And that's how people who are disciplined with money become wealthier than people who get trapped in these cycles where they just want to look rich, but they actually aren't. I'll be laughing all the way to the bank at Brian's expense.

We love you, brother. We love you, brother. We love you, Brian. This is The Ramsey Show. You are listening to The Ramsey Show. I am Jade Warshaw. To my right is Dr. John Deloney. We're taking your calls. So call us up.

The number is 888-825-5225, and we'll get into it. Today's question of the day is sponsored by Neighborly, your hub for home services. Before the weather warms up, Neighborly can help you find local service pros like the Ground Guys, Five Star Painting, and Mosquito Joe to turn your outdoor space into your favorite place. Find the help you need at neighborly.com slash ramsey today. Today's question comes from help in Illinois. Help writes, we've been married 23 years and my husband has struggled to find a

career. He currently has a business which is not profitable. So he currently has a hobby where he spends our money. I have a full-time job and make about $400,000 a year. My husband is supposed to contribute a set amount per month, but he doesn't and will not even mention when he misses contributions. When he does bring in a big check with his hobby, I added that, we argue about what he's going to contribute to the household. He thinks he shouldn't have to tell me when he spends from our joint account i am the one paying everything so i need to know how do i fix

this wowzers and um so this is jade a marriage that is in way more trouble than it appears to be it looks like hey we make a whole bunch of money. My husband's just in there making a time machine that never works, right? And I have to go to work. It's like Honey, I Shrunk the Kids, right? He's in there making a thing. Walk race.

Yeah, he just loses money, loses money, loses money, gets a big check, and then he's like, it's all mine. But this is a wife that is fully resenting um her husband this is a husband who completely disrespects his wife and this is a this is a train wreck in slow motion happening in real time yeah it sounds like she's they've been in this wheel yeah and the dance over and over and over yeah this business is going to be the one yeah and all the while she clearly is co-rushing it the top one percent of earners in america right so she must be amazing at what she does

what a mess what a mess what a mess so okay well let's think about this on both sides because there is a world where what do we think john he should be contributing because he may not make 400 000 he may not make 200 000 a year or even 100 000 a year but he's got to contribute something to the household if he says he's going out and working every day well i think the important thing here is less about the set amount and both, because she makes 400 grand a year. There's something in here that says she wants him to be making a certain amount. Yeah, but I don't think it's about the money. I think it's about, I want you to participate in this home and you don't. You just extract from this home, right? You're a cancer. You continue to grow and pull nutrients away from the mothership

and you're not contributing anything. I want you to have a purpose here. and so they and their family have defined purpose as dollar amount which i think is a dangerous place to be instead of saying here's our money in this pot here's our values outside of this pot how are we going to live those things out and he is saying i don't care what your values are i'm going to go do what i want to do when i want to do it and that's not good yeah right yeah i agree i also think though like where do they start because on the one hand you say i think he if he just contributed anything but reading this i have a feeling if he if he made forty thousand dollars a year she'd be like now that sucks i bet not you bet not yeah i bet if he did anything. I think there has to be a, this is one of those,

I normally will say, you gotta stop the dance, right? You gotta turn the music on, turn the music off, turn the lights on. What I mean by that here is, this is a moment where you say, hey, starting next month, I'm pulling, I'm gonna open my own checking account. Oh, you think so?

And we're gonna split this thing up and we're gonna have a hard conversation about contribution and participation and what love looks like in our home. Because this is a recipe for not just a divorce. This is a recipe for an implosion. Somebody's going to do something dumb if they're not already doing something dumb.

Okay, so that's step one. What's step two? Some sort of counseling, right? Absolutely, yeah. This has reached a point where two people can't sit down and navigate this on their own. This is too big of a mess. This is shame. This is control. This is, I'm tired of playing both the feminine and the masculine role in this home. This is, you don't love me. You don't listen to me. This is all that. It's very challenging to navigate that on your own. So yeah,

go sit down with professional help. And here's what we have to say. We are not trying to save our marriage. We're trying to build something new. If you try to save it, it's, well, what about this? Cool. This marriage that they had for 23 years has fallen and crashed. We got to build something completely new. And thankfully, money's not going to be an option i mean it's not going to be a barrier we got four hundred thousand dollars a year we can do whatever we want to do finances aren't going to constrain us it's just going to be our own egos and our own decisions to build something together that's what's going to constrain us that's good that's good what a mess what that is a mess that is a mess yeah i think that both people definitely need to be contributing in some

way that is agreed upon it's like if you stay home and you're not making money, you better be taking care of kids is all I'm saying. All right, let's go to the phone lines. We got Ben and Fayetteville, Arkansas. Yep, that's it. Let's go, Ben. What's going on? Yeah. Hi, how are you guys? Doing good. How are you? Oh, pretty good. So we actually just finished paying off the rest of our credit cards and we still have a house loan but we are we have the we have the three to six month cushion in our bank sweet and we're actually just looking for somewhere to start investing money um i'm 30 and never really invested anywhere and i'm i just to, you know, start having something to show for that extra money that we're bringing in. For sure. That's not going for those credit

cards and car loans. So technically you're in baby step four, which is for those listening, that's the step where you start investing 15% of your gross income every single month. And so a great place to start is to look at your employment situation i mean are they offering you a 401k or 403b or anything like that no no this is just a small business it's me and one other guy uh working for a guy who owns the business okay and um they don't even offer health insurance i i have that already um health insurance not a big deal but yeah the 401k that he doesn't offer. So then if that's the case, I would just start with a Roth IRA.

You can max one out. I think the limit this year is $7,000. And so you could start with that. And then if you still have money to go to get to that 15%, you could open up like a simple 401k and set aside some money for yourself. Because are you basically treated as a contractor is that right no no i'm an employee yeah i'm still i'm still i still have a w-2 and a w-4 i'm not at 99 then i would start i would start probably with that roth 401k or roth ira and then from there

you could look into something since you do your own health care. You could look into an HSA. That's another great place to start. And then there's always the brokerage account, which is great. So you've got some options there. I always suggest working with a Ramsey trusted pro on that because they can help you get started in choosing the funds. The way that we teach here is kind of just like this basic umbrella. Of course, you want to start with mutual funds and we want you to mix that 15% of money that you get over four different types of funds so that you're spreading your money out. You're not just putting it into one or two or three stocks, right? So you want it to go into growth funds, growth and income funds, aggressive growth funds, and international funds. So that's how you're splitting your money up when you buy investments within your Roth IRA. Does that make sense? Yeah. So doing something

like, because me and my wife are looking into it before I called you guys. So doing something like the app Fidelity or anything like that, that's not something that is is good right we need to you're saying like if you were to go on the fidelity app and do your your investments through them yeah not by ourselves right that's not a good idea it's better to do it with someone who's more knowledgeable i guess yes i mean you can choose the brokerage that you want if you wanted to but the whole idea is you're getting someone who's got more expertise than you do i think it is good to kind of get in there and and see for yourself what these things are and read about things and get your eye on things that you think hey I think this could be a good idea and then run it by that pro and you guys can actually talk about it like

adults and you're understanding what he's saying and he's understanding what you're saying and you're working together not just hiring a guy you, that will automate it and be like, hey, this is what you do. Because you don't want somebody to just take it over for you. You want to feel like you're speaking into it as well. Does that make sense? Yeah. So that's how this works. Work with a Ramsey SmartVestor Pro on your investing, especially to get started, just so you know where you're going.

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1749 Mallory Lane, Suite 100. Brentwood, Tennessee 37027. What's going on, everybody? You're listening to The Ramsey Show. I am Jade Warshaw. This is John Deloney, the other voice that you'll hear on the line. We're taking... I'm John, aren't you?

Just wanted to clear it up just in case people were wondering who that other voice was, John. We're taking your calls. The number is 888-825-5225. So jump in, and we'd love to hear from you. Let's go to Jennifer in Sioux Falls, South Dakota. What's going on, Jennifer? Hi. Hey, thanks for taking my call. I'm South Dakota. What's going on, Jennifer? Hi. Hey, thanks for taking my call.

I'm so excited. It's Jade and John. Hey. We're excited to talk to you. So I'm looking for some ideas on how to deal with my adult son. I just want to say it's so hard to be a parent to adult children. So my husband and I have three adult children. They are all college graduates.

They are all gainfully employed. So our plan, cause it was important for us that they go to college. So our plan was that we would pay for 25% of their college need, you know, their tuition and room and board. And then they were responsible for the other 75%. Okay. their tuition and room and board and then they were responsible for the other 75 percent okay so then of that 75 percent whatever they would need to cover that um we would just loan it to them and our gift to them was that it would be interest free so that way they didn't have to

go out and wrong so one of your kids is not paying you back are they well he's paying me back but boy it's like a turtle i i need him i i'm just like our daughter she got after it right away and she you know within five years she was all paid off and then our other son his amount is so much smaller that i'm really not too worried about him and so it's that middle son. I'm just like, wow, honey, this is a lot of money. How much? His grand total was $57,750. Have you written out terms and handed them the terms of the loan repayment plan? And John, that was our mistake. In hindsight, we should have had something written down,

some kind of goals or rules or payment plan or something, but we didn't. We just said, you know, nine months after you graduate, the payments will start, the payments will be whatever you can handle at the time. And that's kind of just how we left it. So in hindsight, we should have done it differently. Oh my goodness. Okay. So so how much how much would you say you're receiving are you receiving anything or you're getting some but it's sporadic tell us a little bit about middle child paying back yep so he he has a pretty decent job i'll say i don't i really don't know what he makes we don't talk about that and i'll start out by saying our

relationship is good. Hold on. No, it's not. It's not good. It's not good. He's got this hovering over him. You've got it hovering over you. And even coming out the gate saying he's got a good job, you don't know. He could be making $30,000 a year or he could be making $250,000.

You don't know. And so you're already bringing some baggage like things are good except that, you know what I mean? It's important just to call a spade a spade on this one so when okay so at nine months we decided together that 250 a month would be his payment okay that's what he said he could handle so i said great so like two years went by and he was still only at 250 but in the meantime he's gotten a few raises and of course he's probably gotten some tax refunds. Oh, okay. So you're trying to spend his money for him.

You can't. Y'all made an agreement, and he's keeping up the agreement. Well, I know. He's never missed a payment. He's doing exactly what y'all sat down and agreed to. The bank can't call you and be like, hey, we see you make more money. You should pay us back faster for this car note. Like, y'all shook hands. Was it a terrible deal that y'all shook hands on, both see you make more money. You should pay us back faster for this car note. Like y'all shook hands.

Was it a terrible deal that y'all shook hands on, both of you? Yes. $250 a month he's going to owe you for the rest of his life. I know, 19 years, I calculated it. I know, but you shook hands on it with him. Jennifer, you're in the wrong. You can't spend his money for him. Yeah.

And on many ways was this not the right choice. Yeah, you can't spend his money for him. Yeah, it was. And on many ways was this not the right choice. And I hope that you see this in retrospect. Number one, you can't lend money to family members. You have to give it or don't do it at all because it changes the relationship. Like you said earlier, oh, our relationship is good. And then John went through and told you

why it's not as good as you think. And then the next thing is you guys decided the terms and you shook on it or spit shaked or pinky swore on it whatever you did and then you changed them in your mind based off of what you think that he's making more and what he should be doing that's not fair i know i know hold on hold on hold on Jennifer in a perfect world you're right he should go I my parents gave me

57,000 extra dollars to go to school 75 in total but 57,000 is mine and I'm going to knock this out as quickly as possible should that be the way the world just works

yes it should but he doesn't have here's the thing he unless he starts listening to the ramsey show and he becomes motivated to get out of debt he has no real motivation there's no interest on it mommy holds the loan she's not going to come repo my house or my car there's no you have not built in any sense of urgency around this deal so why so i've been thinking so can i like create a business a payment plan like you could do whatever you want just know it may come at the cost of the

relationship with your son or it's going to have to be hey i agreed to something i agree to 250 bucks a month and um we're going to begin to plan in three months or 90 days or in six months, I want to move that up to 500 or to 600, or I want this whole thing done in five years. It's starting to weigh on us, our relationship or whatever. But you don't know that he's not talking to his friends saying, my mom and dad really set me up for success. They gave me an interest-free loan to go to school.

They're barely requiring me to pay it back, and it's really setting up me and my family. They may think you were the greatest parents ever. And over, and on your side, you're like, I've got a degenerate son who doesn't, he's just doing exactly what y'all agreed on. What's your son like? What's he like? He, I love him to death, but it's just money. He just, his whole life, he's just ignored money. So, because I think it gives him a lot of anxiety. I think he just thinks if I don't address it and I can make all my payments and, you know, I'm in good standing everywhere, I must be making enough money. He just doesn't think beyond tomorrow. And can we be honest about why? He's never had to.

Yeah. You've always taken care of him. You've always come up with the money for him. And then secretly you seethed that he wasn't like your other two kids. Yeah, I wish he'd be more like his sister. And you know what? Here's the deal. He feels that from you.

He knows he's not enough for you. And because everything's been taken care of, he doesn't know why. He just knows mom doesn't like him. Mom's always asking about my money. Mom's always asking about my tax return. And there's this hovering 50 something thousand dollar gap that makes sitting down at the dinner table really tough for us. So what you're saying is just leave it alone. No, no, I, if you and your husband say, hey, we need this money for retirement, or you and your husband say, hey, we think we're setting a bad example, I think you sit down, but as part of the conversation, you can't start the conversation with your sister did this and your brother did this

and you're just, it can't do that because you all shook hands on it. It has to be, hey, I messed this up. Your whole life I have let you go around the issue of money, which accelerates anxiety. It pours gasoline on anxiety instead of holding your hand and walking you through the middle of it. And I didn't do my job and I'm sorry, but we can't do night. I'm not going to be, have my son in debt to me for 19 years. I love you too much for that. And that means we're gonna have to accelerate the payment plan. I'm willing to help you with a budget.ade and i we're gonna give you financial peace

university and every dollar for you to hand to him as a gift and say here's a path on how to walk through that anxiousness to healing on the other side of this deal to where money is not an anxious it's not an anxious thing but but, but to change the terms, and he might say, I don't have it. I don't got it. And then what? And then what? Right. Yeah. And then you just have to accept the fact that you, if, if you say I want to change the terms and he says, I don't want to do that,

I can't do that. Or I have these other responsibilities. There does come a point where you kind of have to accept. Yeah. You got a choice to make. You're going to lose your son. This is what we agreed on. And so that's what he has said to me. But I don't think he's really sitting down and looking at his finances to know if he couldn't even bump it 50

bucks a month. Yes, but you don't get to choose that. You don't know, yeah. You want to choose it, but you don't get to choose it. Let me tell you something. My husband and I had a Parent Plus loan that was in his mother-in-law's name and it got to the point because she wanted us to pay it off quick more quickly than we were it got to the point that it was getting frustrated and we finally had to decide when you're around us you have to choose the mom hat or the bill collector hat you can't

be both and so once she realized that and it's like okay like mom hat time I love you all these great things. And the less that she chose to put on the tax collector hat, the better the relationship got. You have to own your mistake on this one and not be mad at him that he's not thinking 50 more dollars or 100 more dollars. You're going to change the terms, sit down and change the terms like adults. But you got to go first and say, I messed this up. This show is sponsored by BetterHelp. This is the season for Halloween. It's October. We're wearing costumes and we're wearing masks. If you haven't started planning your costume yet, get on it. And while you're thinking about it, I want you to be

honest. A lot of us hide ourselves. We hide our true selves behind costumes and masks all the time. We do this at work. We do this around our friends. We do this around our families. We even do this when we look at ourselves in the mirror. I know because I've been there multiple times in my life and it's the worst. If you feel like you're stuck hiding behind masks and costumes all the time, if you find yourself hiding from your true self, I want you to consider talking with a therapist. Therapy is a place where you can be honest, where you can talk to somebody else and reflect and learn, and you can accept all the parts of yourself over time and start living an authentic life. Masks and costumes should be for Halloween parties, not for our emotions and our true selves. And if you're considering therapy, try calling my friends at BetterHelp. BetterHelp We'll be right back. at any time for no additional cost. Take off the costumes and take off the mask with BetterHelp.

Visit BetterHelp.com slash Delaunay to get 10% off your first month. That's BetterHelp.com slash Delaunay. All right, all right. You're listening to The Ramsey Show. I'm Jade Borshaw. This is Dr. John Delaunay. We're taking your calls, America, or wherever you want to call in from. Just know that the number is 888-825-5225.

John Deloney, I'm so excited because tomorrow morning, George Campbell, fellow Ramsey personality, George Campbell and I are going to be doing this really cool bonus hour that we're calling the Every Dollar Bonus Hour, where we're coming in at nine in the morning. Yeah. 9 a.m. Tuesday, the 27th. And we are helping people live on YouTube with their budgeting questions. Now, you might be thinking, OK, Jade, what's the big deal? That's what The Ramsey Show does. This one is different because, A, we're going to have Every Dollar pulled up live. Like, they're showing it on the screen right now. We're going to have EveryDollar pulled up. So when you ask the question, we can actually show you, you'll be able to see it in real time. Like, hey, Jade, you know, I have a problem with irregular income. What am I

supposed to do? We'll actually be able to show you in the app EveryDollar how to do it. You can ask whatever question you want and we'll be able to actually let you see it, which I think is a big piece to learning. It's one thing to hear it. it's another thing to see it happening and so i'm really excited because i think that's going to really help people get their budget and their money on track once we've all been to like work presentations where some guy gets up and starts talking you through like uh like a tech thing he's like when you're going to want to click on the third box and by the time i'm snoozeze, yeah, I'm just falling out. So yeah, I've been able to watch you guys do this will be fantastic. I kind of feel like you made it sound like it's the same thing though. No, I'm saying like, if I'm sitting here like, okay, when you get to every dollar app,

you're going to open it up and you're going to like, ah, you already lost me, but Hey, you guys are going to sit here and answer questions in real time. I'm going to show you. Now I'm in on that. And every dollar is really, it's just, it's intuitive. It's brightly colored. Like I feel like there's things that are going to make you stay engaged. Plus it's your question. It won't just be us just talking about it. Like we're not going to just be yapping about budgets. It'll be because of your questions. So come join us tomorrow, Tuesday, February 27th at 9am. Remember it's on YouTube. Matter of fact, you could go there now and click the little alarm button. So it'll remind you to be there. It's bright and early, at least central time it is. So tune in whatever time it is in your neck of the woods and we'll see you there. All right, let's go to the phone

lines where we've got Kelly from Oxford, Mississippi. What's going on, Kelly? Hey, Jade. Hey, Dawn. I'm really nervous. I've been sitting here. I'm really nervous. You don't have to be nervous. We'll be nice. I've been listening for like three to four weeks. I'm kind of binge listening, actually. So I'm just, you know, I'm 22 and I fell in the hole with the trap that America sets that, you know, new cars, they're great. So I have a car payment and I'm looking to try to get out of it and just trying to figure out the best way to get out. All right. Well, let's hear more about it. This car payment. What's the car payment and what's the entire balance on the car?

I pay $565 a month and I owe $27,000, a little over $27,000 on it. Okay. And what is your take-home pay? Like, what do you bring home every month? Let's see. Right now, I'm bringing home around $3,000 every month. $3,000? $3,000 and your car payment is $560? Yipes.

Yes. Oh, that's a big box of farts. I hate that for you. That's so much money that sounds terrible john okay um what other i mean it's just it's debilitating that's so because rent is so expensive right now groceries are so expensive all right i'll be quiet i'm just sad for you um what other bills do you have like what other debt do you have is this your only debt uh that's the only thing I have.

I have, I'm on my own phone plan. I still live at home with my mom and dad currently. So I don't have rent. And I think that's why I fell into the trap so easy is that I didn't have payment just the time. And it was- Are you paying any rent to your parents? I'm running for my life.

Yeah. Ma'am. Okay. Yeah, we got to get out of this car so if you were to sell it today you owe 27 on it if you were to sell it what could you get for it have you looked it up in kelly blue book yes private 40 um it said anywhere from 30 to 32 listen bye felicia i know that's right car's gone she gone gone gone you're going to pocket a little bit of change to get you a car in cash. This is a perfect scenario.

Right. And your next car is going to be ridiculous. $5,000 ridiculous. Max. Listen, what do you think? You're silent. I mean, it's kind of scary, but

I mean, if that's what gets me out of bed and gets me to where I can sleep at night and not have to worry about debt. And here's the thing. Yeah. Let's put it in terms that are a little bit more exciting. So you sell the car, you pocket $5,000, you go turn around and buy a $5,000 car in cash. Now you're no longer paying $565 a month. You pair that with whatever other savings you have. Think how quickly you could save up another $5,000, trade in your old 5,000 junker. You're probably going to get 5,000 back for it because it's already taken all

of its hit. Now you buy a $10,000 car. And then you still don't have a car payment. Think how fast you could save up another $5,000, trade it in. Now you got yourself a $15,000 car. Do you see how this works? And before you know it, you're going to be driving a $27,000 car that you paid cash for. And not living at your mommy's house anymore. Well, let's talk a little bit about that. So if you're living at your mom and dad's house, and this is not just for Kelly, but anybody listening, it will behoove you to pay your parents some rent so that there's a paper trail because the time is going to come

when you're going to want to move out, whether it's because you want to get an apartment or whether you've saved up enough of a down payment that you're going to buy a house. And they're going to want to see at least a year's worth of rental and renter's history, especially if you do our plan and you don't have a credit score okay that's not just for you kelly that's for anybody listening don't just live at mommy and daddy's rent free make sure that you can show that you've paid something even if it's 500 bucks a month show and pay something it does it helps you out in that way and it just helps you out in the way of being an adult and kind of paying your way through it. Does that sound fair enough, Kelly?

I think I scared her away. Are you all right? Yeah, I'm surviving. Okay, you're surviving. I know. We came at her hard in the paint. But honestly, that's what you need to do to experience more peace. This car payment is just ridiculousness.

So sell it. Buy yourself a car in cash all right let's go to another phone caller we've got jr he's in indianapolis indiana what's going on jr hey how's it going doing good how are you how can we help uh yeah my question is how do i go off and tell my or not go off but how do i go on and tell my parents that renting is okay? They believe that renting is just a waste of money. How old are you? 22.

Are you living at home? Yeah, I'm living with my parents. I have my wife and son with me as well. Whoa. Yeah, I would tell you that your parents don't get a vote. You have a wife and son. You've got your own family go get yourself a place yeah that's what i that's what i talked to my other relative uh that's cool that i'm very close with uh-huh well as long as you live in their house they're going to think they have a vote by the way yeah as long as you live and they do have a vote as long as you live in their house right and yeah they just my it's just they believe my

parenting is not as good as theirs and they always have they always make it seem like they have a say in they do because you're living in their house take your family out and get your own place yeah as simple as that what's keeping you from renting a place? It's just, I don't know. I'm scared. I've never been out in the real world. John, come on. Come and get my guy. You should have thought of that before you made a human and before you got married. So you're in it, bro. You jumped in the deep end of the pool and you dragged a wife and a child with you. And so you don't have the luxury of saying, well, I never took swim lessons. You got to figure out how to swim right now.

And this is when you move out this weekend and get a one bedroom apartment and you get job number two and job number three. You're going to figure out like, quote unquote, what I got to do and what I'm passionate about what I'm interested in as you're flying down the highway brother because you have a wife and a child to take care of right what do you make right now uh I make about uh 2200 a month yeah you're gonna triple that yep triple that but yeah I Yeah, I also talked to my wife, and my wife's thinking about going back into the workforce as well. When? How old's the baby?

He's about to be one. He's one years old and four months, yeah. Okay, so she needs to get back into the workforce. He's a year and four months. You guys have got to, you've got the family there, so you've got some daycare. Obviously, if you were living with them, they'll probably be willing to help you out in this way.

But you've got to start making some major moves to John's point. If you want to see the needle move on this. Thanks for listening to this hour of the show. 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 am Jade Borshaw. John Deloney is to the right of me.

I'll be taking your money calls. He'll take your calls on really just everything else, John. I feel like you run the gamut. We're just talking off air. This whole show exists for one reason, provide hope that's just what this show is about but man i tell you what sometimes that light gets real dim out there it does like would you just i i'm not a big news reader but occasionally i'll just dip my toes back in god almighty people have lost their minds oh yeah oh across the gamut when it comes to schools and marriage we had a caller in a former hour that was like hey man like my parents are speaking into my marriage um i'm married with a

kid and we live in their like rent free in their house it's like yes yes yes well i'm scared to like you know grow up and it's like i i just i don't have a psychology for it sometimes and that's why i'm glad you're my friend jade listen at the very least we are always going to tell you the truth truth man and the truth should bring hope at first it'll make you be like, oh, crap. And then if you turn that corner, there's hope on the other side. And we can always look over here through the glass at the mighty Bob Marquez. That's right.

Between two of the most hopeless people sits Bob Marquez, who brings joy and light into everyone's life. Oh, boy. And he has a great radio voice. All right. The best. Give us a call. The number is 888-825-5225. And we will chop it up with

you and john hopefully you can shine the light you can find that group that you need all right let's go to the phone lines we got stephanie in albany new york new york what's going on stephanie thank you for stopping me from getting into it i'm hoping you can give me some hope. I'm trying to get some perspective on a big decision that my husband and I have to make pretty soon pertaining to his career. He's finishing up a medical residency, which is very exciting. And he has two offers and we're trying to weigh the pros and cons of each. And yeah, we're kind of stuck on where to go, which one to pick. Tell us about the offers. Well, one is where we could stay, where we are living now, would not have to move. It's offering about $90,000 more than the other offer,

just in like student loan repayment and a sign-on bonus and a little more salary. The other one is still a good offer, but would get us closer to my family and friends in Pennsylvania. So both good options, but we just don't know what to do. Let's think about it. How much student loan debt is he going to have coming out of this? $300K. So my initial thought, and you can start poking holes in this, my initial thought says, okay, if there's 300,000 of student loans that we're going to have to pay off and we can stay where we're at and make 90,000 more, that's looking like, it's starting to look like a green

light for me. Help me see why it could be better simply moving closer to family, your family. Well, that's what I'm struggling with. Like, I think financially on paper, that does make more sense. But you've been dragged around through med school for the last seven to 10 years and you're ready to get back to your family, right? Yeah, yeah. So I just don't know how to look at it, like from a financial point of view, or I felt like I've been looking at it through a microscope through every angle possible, and now I just don't know where to go.

All right, let's change the whole, let's back all the way out, okay? It's sometimes the more, the finer the microscope, the more we think we're learning, but actually it just blurs up the whole thing. So let's back all the way out. What Jade said is right. The math is the math, the more we think we're learning, but actually it just blurs up the whole thing. So it's back all the way out. What Jade said is right. The math is the math is the math. And you can try to make the math not the math, but the math just is. Right.

Instead of should we do this or should we do this, stop looking at this as a right decision versus a wrong decision. And just exhale and say, what a crazy fortunate season of life that we got two options. And that means that you're going to pick one and six months, six years down the road, you're going to have more, you can have different ones and reverse engineer this whole thing and ask yourself in nine months, when your husband comes home from work and your kids come bebopping in the house, what do you want that to feel like? Where is that going to be? And build the life that you want to have.

Don't look at it as a scarcity, like, well, it's got to be this one or it's got to be that. Man, it's such a more vast picture than than then when you're trying to look at under a microscope are you tired in new york i'm hot and cold with it there are things that are really great about it but do you are is the thought of living next to your family life giving to you yeah okay have you been honest with your husband about that i have yeah okay as he said i don't really care we're going to make a whole bunch more money get my loans paid off so we're staying in new york no no he he has not said that um but that's that's another thing that's just kind of complicating this for me is like it's not really my career you know it's his it's your home it is

your home it is your home what is y'all's home yeah what is your career are you able to just easily move yes yes I was I owned my own business for 10 years um but gave it up a couple years ago and so I'm mobile okay but um and now i'm staying home with the kids okay so okay i see well many times people call in and i don't know maybe maybe john and i are opposing i don't know that we're opposing we might just be focusing more no i say to stay stay in new york for 24 months y'all shake hands 24 months and we're gonna live spartan and we're gonna pay these stupid things off okay and then we're gonna see how life looks. Yeah. I'm with that. I'm with that. Once we've exhaled and then say, we can, by the way, we're going to budget for 10 grand because we're making a whole bunch of money

for flights for me and the kids to go to Pennsylvania and spend some extended time. And so we're going to build some of that in and you can practice life in Pittsburgh, but also you can get these stupid loans out of your hair because y'all have made a bed that you got to sleep in for a minute. And then you can begin to decide what kind of life do we want to have that's my that's that's no i'm with that because so many times stephanie people call in after the fact they've made the move because they've kind of followed their heart on the journey and now they're in it and now the reality of the money that they owe comes you know crashing hurtling back at them and it them. And it's like, oh man, what do I have to do? And it's in those moments that I'm always telling people, listen, you,

you have to choose like there there's whenever you've made a, I'm going to call it a mistake because I think that debt is a mistake because it's something that you always have to go and you're, you're having to fix the past. Right. So in that way, I'm kind of calling it a mistake. You do have to trade off. And I'm kind of hoping that you can make that trade on the front end, like John was saying, instead of moving to Pennsylvania now or as soon

as he takes this residency and then finding out, oh man, like we've got this crazy debt. It's not as great as I envisioned it would be because yeah, I'm close to my family, but now my husband's got to work, you know, three times as hard. And it just, I don't think it will be all it's cracked up to be if you don't have that freedom very closely in your mirror. So I would do what John said. 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. Stop wasting your money and really focus on getting out of debt and growing your savings. For over 25 years, I've trusted and used Zander Insurance to find the best rates on term life insurance from the top-rated companies. They keep the whole thing simple. You can apply online or over the phone, and they even have

low-cost plans that don't require an exam. Go to zander.com or call 800-356-4282. Even if you don't have a cash value policy, if you're one of the 70% of people who have no life insurance or not enough, it's even more important to get this done. 800-356-4282 or zander.com. What's going on, party people? This is the Ramsey Show. I'm Jade Warshaw.

This is Dr. John Deloney. We are taking your calls, so give us a call numbers triple eight eight two five five two two five and we will give you our best advice that we can come up with some say the advice is worth what you pay for it that's an that's an old school Dave-ism yeah that's a Dave-ism guys uh want to tell you about a new event that's coming up that I'm super excited about. This is the Total Money Makeover Weekend event. TMO! Yeah, TMO.

TMO! Here at Ramsey, we like to make acronyms for everything and just say the abbreviation. So it's T-M-M-O-W. Total Money Makeover Weekend happening May 10th and 11th here in the Ville. Nashville is what I'm talking about. We've got an event center up on a hill. It's really amazing if you've never been there. And so the point is, it's a smaller or limited venue, I would say. So you got to get your tickets right away.

These tickets are starting at $99, guys. So please believe that their hot potatoes are going fast. You can get your tickets now at ramseysolutions.com slash events. And I think that you should get a ticket because this event is very different, John. This is a crash course on everything we teach people about money. You'll hear everything from brand new content, brand new.

So if you've been to one of our events before, you're like, I already know what it is. No, this one's different. All the personalities are gonna be there. We're talking a different spin on budgeting and beating debt and investing and more. And so what I like about it is no matter what baby step you're on, it's for you because we're talking about all the baby steps. So whether you're paying the house off or you're just trying to get a thousand dollars saved, this is the event

for you. One of my favorite things that we're implementing is more and more Q&As. So you'll get to ask your questions and we'll be answering them. I don't know about you, John, but I have some pretty fun stuff up my sleeve planned for this event. So I'm looking forward to it. Yeah, I think it's gonna get off the rails a little bit, which I'm looking forward to. Yeah, the first 500 tickets have already been sold.

And so you gotta keep going. Oh, I'm sorry, I read this wrong. It says, with the first 500 tickets sold, you'll get a copy of Total Money Makeover signed by Dave. Wow, that's great. Very cool. That's gonna to go really fast. So make sure you get your tickets again, $99 for a limited time, ramseysolutions.com slash events. That's cool. I'm excited for that. I don't know about the rest of you guys. Let's go to Travis, who's in Portland, Oregon. What's going on, Travis? Hey. Hey, good. Hello, guys. Thank you so much for taking my call, and I really appreciate your

time, and I'm happy to be here. Well, we're happy you called in. How can we help? Well, I was just hoping you guys could shed some light on maybe what angle I should be thinking towards our debt and getting out of debt and what steps I should be taking. So the premise of it is we have $65,000 in debt to go. We were at $127,000. We were semi-gazelle intense, and then my gazelle got a leg cramp there for a second, but we're back on it. Okay, good. Yeah, we're back on it. I'm personally active duty, and I'm a nurse, and my wife is also a nurse, but she has got the harder job, which is being a full-time mom. She homeschools. She has a teaching background, so we're really trying to put an emphasis on giving our kids a

home education. In the past, I've tried to look at maybe getting extra work, but being in government, it's really hard sometimes because there's what's called conflict of interest. So I've found it, in my opinion, too difficult for me to look for extra work without breaking our rules. What makes it a conflict of interest? Can you give me an example? Sure. And I'd prefer not to give the details of the agency if you don't mind. But I one time applied for a job and I got accepted. So I had to go through our HR department. And because the other company received grants from the federal government, we can't work with that company. So it's that kind of thing. And it seems like that happens a lot in the medical world

because a lot of things come from the federal government payment wise or grant wise. Right. So, I mean, unless I want to be doing and I'm not against it, but I could be like DoorDash or something. But I prefer to do nursing shifts because they typically are going to pay better. Right. But if you can't, then because it sounds like you're saying you're trying to, but you're running into this red tape. So the question is, what are you going to do instead? Yes.

Yeah. And I guess the other part of that question, and I have so much respect for my wife, so I'm not saying this. I don't want to be misquoted or misheard, but my wife also has a nursing license, and I thought about her maybe picking up two or three shifts a week um that's great she's gonna yeah but I guess my I guess the issue is I I don't think she's quite on board with that and I don't know if I am either and I'm just wondering what you guys think is the best course to take because you're both working you're working at your nurse job and she's working with the kids so i don't think it's bad to ask the wife who's at home to also pick up work if you're also willing to pick up work i feel like it's both of you sacrificing in the way that you can with the hours that you have john yeah and it's easy

to paint these as forever conversations and what i hear a lot on the show is people calling and they've boxed themselves into a cage with their own variables. We have to homeschool our kids. We have to do this. We have to get this paid off. We have to do this and we have to do this. Well, then there's nowhere to go. And so what I always want to recommend people do is just think in six month increments for six months. Could we we could you take the shifts that you're able to work and because you're also active duty you're going to become a um part-time stay-at-home dad while your wife goes and picks up shifts that are actually that y'all can send to the creditors that you owe y'all created a world where you owed 120 something

thousand dollars you got it down to 60 something thousand but that journey's not over yet or can we put our kids in a local local small school or in a public school for just one year and it's going to make us so uncomfortable that we are going to go bananas getting the stuff paid off working every shift we possibly can you see what i'm saying and then then if you make that, you know this, you're in the military. You make that short-term sacrifice, it pays off forever. It's just being able to say, hey, this is not forever. This isn't the way this is going to be.

And by the way, this is not how we drew this up. We don't want this to be true, but it is. What do we have to do right now? And I think y'all are too smart. Y'all could solve this problem. It's just you've trapped yourselves

with your own have-tos and shoulds and musts, and it's going to keep you paralyzed. I appreciate the insight. Does that make sense? It does. It does. Yes, it does. I think it would be something that I would want to talk to my wife more about

because I think she's a bit more apprehensive than I am, and I don't want to come across as disrespectful to her because I think what she does is incredible um I don't I think you've got to stop apologizing you're tiptoeing in and I think that tiptoeing makes her think something's wrong and both Jade and I are telling you man there's nothing there's no tiptoeing y'all are both working your butts off to try to meet the values of your family. And to y'all are both in service oriented jobs. That's just who y'all are. You're both great people.

It's just a matter of saying, okay, for this season, can we align our energy in this direction? That's not the direction we want to go forever, but just for right this second. And you said something really important that I think everybody needs to hear when you're heading into these hard conversations are the ones that you're kind of apprehensive about with your spouse. Start with, hey, what about this scares you? And it could be, I don't want our kids to get behind because if they get behind in school, then this, they're not going to know algebra. And then all of a sudden, they're not going to get into the college. Okay, we're going to be okay there. Or maybe it's something more existential. Maybe it's bigger. Maybe it's more X or Y or Z, but let's start with, Hey, what's scaring you to death about this?

Not here's the plan. Let's do the play. You see what I'm saying? Yeah. I can come across the way you just said it. So that's why I try to bite my tongue a little bit. You know what I mean? Yeah, totally. And, but here's the deal by not biting your tongue your wife is looking for some sort of strategic direction and because you hem haul around it because you don't want to come across as a guy who's an active military guy with here's the plan let's execute the plan yeah so you end up handing her no plan and that's when fear it takes over sometimes so let's sit let's sit down and co-create one together and start with, hey, what scares you to death about this? You say, we owe $60-something thousand dollars and I can't breathe. And I don't feel like I'm being a good husband or a good dad chasing this debt around. Now you go.

What scares you to death? Here's our kids, someone else raising our children. All those things factor into it. And once we get the fears out of the way and on the table, everybody's got fears on the table, now we can start together co-creating a plan. And then we're just going to follow the plan and knock it out. You'll get there. What do you think, Jade?

I love that. I think just remembering everything is short-term. Short-term. It's temporary. It's not going to be like this forever. And just always remembering that some people are just afraid of the unknown. I've never had to work this hard before. I don't know what it's going to feel like.

I've never had to have two jobs. And that's fair and that's okay. But I think together you guys will be able to work through that. This is The Ramsey Show. What's going on? This is The Ramsey Show. Thank you for listening. I'm Jade Warshaw.

He's Dr. John Deloney. Give us a call. The number is 888-825-5225. And we'll do our best to hook you up with the right advice for your situation. Let's go straight to the phone lines where we've got Chantel in Charlotte, North Carolina. What's going on, Chantel? Hey, I have kind of two questions. I just recently cashed out my retirement from an old job. I paid off my car because I had a $700 a month car payment and I was just kind of really struggling, like having to work overtime just to make my regular bills instead of working overtime to pay extra. So I took a pretty big hit. I had about $34,000 in that account. They took 20% of it, so I was able to

cash out about $26,000. So I used that in combination with the money that I had in savings and I paid off my car. So now I'm just questioning how do I prepare this next year for tax time? I know there's going to be like a 10% fee. At minimum. Yeah. And also I'm questioning do I turn around and sell this car and put that money towards my other debt? I do have another 05 Camry that I bought in cash just to run around for work because I drive a lot of miles, but it has 208,000 miles on it.

So you would cash out your whole 401k to pay off a car, then turn around and sell the car to pay off another debt? That's what we're talking about doing? Yeah. So I'm torn between do I keep the car? Yes. Whenever you're in the medical field and you find yourself going down a treatment and the treatment is making everything worse, even if you don't know what treatment to go to, the first thing you do is stop doing the thing that's hurting you. And right now you are spinning out.

Okay? Okay. You're making some long-term decisions with a very short-sighted lever. So just take your hands off the wheel, take your foot off the gas, and just slow down for a second. What did you pay for the car? I paid about $41,000 about two years ago. And what do you earn every year? What's your yearly income? My base salary is just over $80,000.

But with the overtime I've been working, my taxable income for last year was $102,000. Okay. All right. The car's paid for. It's not more than 50 50 of what you bring in it's it's now paid for at a very very very very very steep cost uh i'd keep that car and i'd sell the other one the one that you're running around town in um okay tell me about the rest of your debt Um, I have three, three credit cards and, um, a line of credit. Um, those total up to right around 10,000 total. Um, and then I have, um, about $14,000 left to pay for my attorney that I had used for child care.

That is 0%, no interest or anything. I just kind of pay what I can when I can. What else? And then I have a large $65,000 federal student loan. Okay. All right. Are you scared, honey? You sound scared.

Well, I'm a single mom, so. This is a lot. This is a lot. Yeah. Okay. I want you to know you're not by yourself. We're way across the country, but we're sitting here with you. Okay.

I know this one's heavy. So are you receiving any child support from the dad or is that included in the 102? No, I just don't get child support with 50 custody and it's actually pretty cordial and we handle things on our own now. There's no child support because the judge didn't rule it or because you didn't care to go through with it? Both. Part of it was because I earned significantly more income than he does. And I thought I would end up turning around. I'm sorry. Speak directly into your phone. Hey, Chantel, you got to speak directly into your phone. Yeah. Tell me that last part again. Can you hear me? I can. Tell me that last part again.

I didn't pursue child support because I earn significantly more than he does. So I was afraid that I would end up having to pay him. But now things are actually pretty cordial and he, you know, pays for his half of things for the children. So it's just not it's not something that we do okay okay so here's your choices if you wanted to sell the car that you have you could and it might behoove you to do that and now that i know the debt that you have swap swap the situation and you keep the runaround car and you sell this other car if you were to sell it how much could you get for it you paid 41 000 what do you think you could get um it's only worth like

15 000 private party didn't you say you bought it two years ago yeah it's depreciated really really fast because work from my car and i put a lot of miles on it I drive a ridiculous amount because of work yeah okay in the first year that I have this car I put 65,000 miles on it okay well I wish it was worth more but I'm still gonna have you get rid of it because you have a five thousand dollar car sitting there that works just fine like you said to get around town um do you still have to drive an exorbitant amount for work I do yeah I work from my car I drive to different places I don't have like an office or anything that I work in it's just from my car like how far are we driving tell me more um so i'm a hospice nurse um so i drive to different facilities and homes um it varies i drive a lot more miles when i pick up overtime because i'm

covering like the whole charlotte market um so it can be a lot. Okay. All right. Could you do the, be level with me. I want you to be 100% real. Can you do the job that you do in the older vehicle? Yes, I do. That's my daily driver. I hardly ever drive, um, the Buick, which is the car that I just paid off. Okay, then we're selling the Buick.

We're taking that $15,000. We're going to pay off these three lines of credit, these three credit cards in the line of credit, and we're going to take the additional $4,000 left, and you're going to pay $4,000 on the attorney. That's going to leave $10,000 left on the attorney, and it's going to leave you $1,000 saved. I'd leave about $4,000.

I'd check with the tax person because she's going to leave you $1,000 saved. I'd leave about 4,000 bucks. I'd check with the tax person because she's going to owe the taxes on that too this year. She does, but I think she's got some time to stack that up. Or you got to save up for it. Yeah. Yeah. And I would talk to a tax professional to find out, but that's your first order of business with the money from the sale of the car. And then everything else goes into the debt snowball. So you've got the 10,000 for the attorney, you've got the student loan for $65,000 and know that you're on the hook for taxes come the end of the year. And I want you to find out what that's going to be sooner than later so that you can put that into your debt snowball and kind of put a sinking fund where you're putting a little bit aside every

month so that by tax time, you'll have that money. when did you take the withdrawal on your 401k was it 2024 or did you do it last year it was 2024 okay so you'll have until next april you'll have a year um more or less to save up for that so in the meantime you've got to just be there's no way around this other than to say that you're working like a crazy person luckily you have an asset that you can sell do you have any other money laying around stocks anything um no i have 1800 in savings now um it was close to 8 000 but i i took a good chunk of that to pay off my car okay so you're you're going to, since you already have $1,800 in savings, I want you to take $800 of that, and I want you to put it towards this attorney bill.

And that's going to knock that down, because I already kept $1,000 aside. That's going to knock that down even further. So $1,000 saved, everything above and beyond your minimum payments on your bills goes to the student loan. You're working like crazy, girl. Take all the shifts that you can get until this debt is paid off. It's not going to be easy. This is The Ramsey Show. You are listening to The Ramsey Show. I am Jade Warshaw. Dr. John Delonious sitting right next to me'll be your hosts for this hour and the next hour. If you want us to take your call, you can call in.

The number is 888-825-5225. And hey, if you're listening to this on whatever podcaster you listen to, or if you're watching on YouTube or you listen to it on the radio, thank you for doing that. Obviously, we exist here because of you guys. There would be no show if there were no listeners or watchers or subscribers. So thanks for doing that. And if you could continue to do so, wherever you listen to this show or watch the show, be sure to like it, subscribe it, and share it with other people. Because when you do that, it just spreads the love around and that is good for everybody. And of course, I don't have to tell you guys,

the algorithm loves such things. So keep doing, I don't have to tell you guys the algorithm loves such things. So keep doing that. We're sure grateful that you do. All right, let's go to the phone lines. We got Ashley in San Angelo, Texas. What's going on, Ashley? Hello, thank you for taking my call. I am calling because I have a couple questions about life insurance, first of all. So I just got on Xander probably about a month or two ago. I had my counselor that told me about it, so I got onto it. My husband actually got onto it as well. My payment's about $30 a month for it.

My husband's is $100 just because he has a history in the past of atrial fibrillation. Okay. Hasn't had any issues since, but they dinged it and his is about $100 a month. Okay. So my question is really because we also have a whole life insurance that we got before we were married that my in-laws, you know, advised us to get. But listening to y'all, I know y'all don't recommend it. But we've been paying on it for, we got married in 16. So we've been paying on it since right before then. It's $91.98 a month. And I've called and tried to talk about canceling it,

but I wanted to get y'all's recommendations. Like since we're already so far in, it's a 15 year note. Should we go ahead and cancel it? So go ahead and cancel it so the policies you have now the policies you have now the one that you have for 30 and the one that your husband has for 100 those are term life correct yes okay great yeah you know i would go in and i would cancel and cash out that whole life one immediately okay do you know why okay well i so my my stepdad he follows y'all he's i mean been phenomenal with it he's kind of explained it to me but if y'all could explain it to me and probably help me understand it a little better yeah you know big picture you know when you have a whole life insurance policy part of it goes to your policy and part of it goes to an investment that's why you pay more for it so 9198 part of that payment goes to cash value uh which is and part of it goes to

an investment so you might have a face value of hey you're covered for this much but we're also going to take a piece of that and we're going to invest it for you and have this cash value over here that at the right time you can have access. But the problem with that cash value that you're investing in is number one, the rate of return is poo-poo. And number two, it dies when you die, which kind of defeats the whole purpose of the insurance policy. Why not just have a policy that you're paying into that's there when you pass away. That's the whole point of it. And so we always say that if you were to take, let's just say you paid into a whole life policy and, you know, $40 of it was going into the cash value and they were investing in that. If you were to take that $40 and invest it yourself in good mutual funds that had an,

you know, annualized rate of return of% to 10%, you could far outweigh what any of those whole value policies would earn you in cash value. So we're just pointing out the fact that the investment side of it is absolutely terrible. And we'd rather you take your money, do a term life insurance policy that is worth the time, worth the money. You get what you pay for. And then if you have extra money, you take that money and you add it to your investments and you invest it on your own through your 15%, which is the way we teach it.

So that's why we say that. I don't want, you know, and for anybody listening, I don't want anybody to just say, I'm not going to do it because Ramsey says so. It's like you need to understand it and make sure it kind of jives with you and you know why you're doing it. So I'm glad that you asked that question. Okay, yeah. And I went back and forth about it just because

just a little personal information about me. I was diagnosed with MS last year. So I was like, am I going to be able to even get term life insurance again in 20 years? I know I'll probably be able to get it, but my premium will probably be through the roof. Well, how old will you be in 20 years? I'm 36 now, so I'll be 56. 56. Okay.

Yeah. Yeah, it's probably going to be more expensive. The whole point, though, and just to make this clear, the hope is that you get to the point where you're self-insuring. The hope is that you get to the point where you're investing. You're working through the baby steps quickly so that by baby step four, you're investing 15% of your income over the course of time. That's going to compound and grow.

And then you pay off your house and you've got equity there. And then after you've paid off your house, you're being able to add even more than 15% to investments, maybe you're to 20 or even 25% into your investments. And the point is that you're building wealth to the point that when this term runs out, you can go, all right, I'm good. Like I've got a couple of, you know, I've got a million dollars here in investments. I've got my home. It's worth this amount. And if something were to happen, my family members would be covered because the thing to remember,

and this is not just for you, Ashley, but anybody listening, the point of insurance is to replace income for people who are dependent on your income. So your husband, if you have children, if something were to happen to you and they're dependent on your income, they'd be covered. But if you've invested to this point, you're already in your 60s, then suddenly you need a lot less of that.

Does that make sense? Some people kind of look at it as their ticket to wealth. And I'm like, no, the whole point of it really is to replace income for those who need it, for who are dependent on it. Can I ask you another question? Of course. I don't know how much time y'all have. Yeah, go ahead. We have a Roth IRA that we got a couple years ago as well,

and I think there's $10,000 in it. I had transferred some money over and put that in there. So, I mean, maybe just put the $91.98 that I was paying towards that in that Roth IRA every month. Yes, ma'am. Love that. Well, what baby step are you on? So I'm not going to lie to y'all. I just kind of started. We're kind of going through a big

change in our life right now. We're going to be selling our house hopefully within the next month or two. Okay. And we're actually buying some property. And I know y'all probably don't advise the way we're doing it, but I feel like it will actually work out. Wait a minute. Wait a minute now. You done told me about it now. Where are you buying property, Ashley? So I know you're from like West Texas area,

so it's in San Angelo off of 277 near Cristobal area. And what are you going to do? I know that area well. What are you going to do with that land? We're going to, we're buying five acres from somebody and we're going to build a house on it. And we can probably make a good amount of money from our house, at least $170,000 to $180,000 that we're living in right now.

And with that money, our plan, what I'm working through and what I've written down and tried to process, is I'm going to pay off my student loans. I'm the only one who has student loans. My husband does not. Um, I owe 79,000 and we have a camper. We're going to live in our camper. We're completely fine with it. Both of us are, we do all on it. So my plan was to try and sell it and then get another camper. That's a lot less in price to where we're not paying the full $50,000 that we owe on it. Rather pay like $15,000. And when you buy the land, you're just going to live in the camper or are you going to

build a house? We're going to live in the camper and save up money. Oh, Ashley, Ashley, you got to get off YouTube. You got to get off YouTube. You were in San Angelo last summer when it was a thousand degrees for like 150 straight days. I know, but I mean, both of us are into it. Hold on. What about...

The wind here is ridiculous. What about staying in your home, you'll look at each other and you make a two-year plan, and you'll work like B-A-N-A-N-A-S, and you get this stuff paid off? Oh, and I'm doing that too. What I do, I have the potential of making an extra approximately $2,000 a month. Go make that. But listen, you're trying to do everything all at once and some cool stuff and some dream stuff. Here's what you're going to do.

You're going to have no home. You're going to be sitting in a used camper in the middle of a field in the middle of West Texas in July. And then a tornado comes. And you're going to see. Yeah. Forget a tornado. You're just going to. Just the dirt from Lubbock is going to fly over. And you're just going to be staring at your husband,

and you're going to think, I don't love you anymore. Listen, we're trying to do too much all at the same time, running and running and running. Just follow the steps. They're boring. They're not sexy, and they work every time. Slow down. Just do it right. This is The Ramsey Show.

Live from the headquarters of Ramsey Solutions, it is The Ramsey Show, where we help people build wealth, do work that they love, and create real, actual, amazing relationships. I'm Jade Warshaw, your host, your other host today, Dr. John Deloney. He is the author of Building a Non-anxious life he is also the host of the dr john deloney show which is popping off if i do say so myself we'll be taking your calls the number is 888-825-5225 get in where you fit in and we'll give you the best advice that we can muster up for you dude get in where you fit in get in where you fit in what's that from that's a t-shirt right there. It is.

I don't know where I got that from. I like that. All right, let's do it. Let's chop it up. We got Jacob in Dallas, Texas. What's going on? Hey, can you guys hear me? We can.

Awesome. I love your guys' show. John, absolutely love your show. Been a long-time listener. Thanks, man. I appreciate you, dude. What's up? Yeah, so got a two-part question for you.

This might not be as much of a money question as it is a relational question, so do with it what you will. My wife and I moved to Dallas around five months ago, and it's been super rough since we got here. We're finally getting our feet underneath us. We both got jobs. She got a job in marketing, and I'm in the end stages of my background investigation

with a local police department in the area. We are on track with the baby steps, doing all this stuff, and she's having a really hard time at her job, and her boss is being a real jerk. And I don't know my place as her husband, where, where it crosses the line for me to step in and speak to him a little bit of background. So you guys know what I'm talking about. He is a very stubborn guy. She's running a business for him where he's trying to market this new product and essentially start up a business. And he put a lot of trust in her from the beginning to hire a team and be that person for his business. And he put it in her hands.

And he's been super indecisive this whole time and shortening the deadline of launch to now six weeks where it's supposed to take nine months. And she's got her hands up in the air. Like, what do I do? Do you trust your wife, Jacob? I trust my wife so much. All right. Stay out of this completely. She's a grownup and this is where she works. That's what I'm thinking. It's real tempting to take this back to like recess and be like, you talked to my girlfriend. This is a place of business. If she doesn't like it, she can walk out the front door. Right. That's what I think think that's what i just don't know the boundary because when he starts speaking to my wife in a way that is extremely dishonoring in front of her she gets up and walks out the door exactly okay that's what i was thinking why hasn't she yeah um well we're in a

little bit of a place where we need the money right now, so we're in a position where we hate it, where it's like, babe, I can't just have you walk out right now, which is what I want to be able to do. No, my dignity is not for sale, and my wife's dignity is not for sale either. Do y'all have little kids? No. Okay. Then it may be that I'm going to put my enrollment in the academy on hold because I'm going to go work three jobs so that my wife can get out of this mess but y'all created a world where you feel like I got it we got it we got to put up with this when we when Jade and I we're always talking about freedom Dave we're always talking about freedom freedom freedom this is exactly what we're talking about because if y'all don't owe anybody any money then you laugh and smile to student be like dude we out right I'm not no's going to talk to me that way.

But y'all feel trapped. What would it take for you guys to, financially, for her to be able to walk out the door? Just, I think the smart choice is finding another job before she leaves because we've had little to no income since we've been in Dallas. No, I mean, it's so bad that you're about to do something stupid. What do you mean? Like you're about to go confront another grown man at his place of business where he pays

your wife. I want to in the fact that that's my wife, but I know that's not the smart choice. I'm not going to do that. No, no, but I'm saying like, it's that bad. It's that bad. I mean, and you called in here saying, should you do that? So you definitely considered it. Let's be honest about that.

What does she earn? What does she earn at that job? Around, she takes around $4,000 a month. Okay. Is there something that she could find in her field to replace $4,000 a month? I'm thinking, yes. Yes. No question in my mind.

Sure. We've had a long journey trying to find a job, though. She's had a lot of interviews and people just don't want to hire for some reason. So this is the first job that she's actually gotten hired. OK, but it's not the last job she'll get hired in. That's the thing you got to. Right. The other kicker is in a month I'm going to be on the police department's payroll. So it's like, OK, we only have one month to, to pledge this, you know?

So what's the, I don't know. Cause I keep telling her, I don't want to overstep. You have your thing to do with your boss, but also this would. If she were to call in today, what would she be telling us? In what manner? Does she, is she saying every day, is she coming home every day saying, I want to quit, I want to quit. Or is she coming home every day saying i want to quit i want to quit or is she coming home every day just being like gosh my my boss is such a jerk what a what a butthead and is she not not talking about quitting she she loves her job and the team

that she works with she just can't get anything done when she's at work because her boss is a jerk and won't he doesn't trust her to do the job that he hired her to do this is you busybodying brother this is between her and her workplace okay why do i mean you see what i'm saying like if she loves her job she loves the work she loves the challenge she just has an annoying boss and i'm just sitting here listening to her talk and i'm like okay so maybe that's the boundary right that might be a conversation if she's coming home every day and she's you know trashing her job it's making you feel confused you can have that conversation with her to say listen if you love your job and you're happy but you come home every day and complain it makes me think that you need to move on or she maybe you don't yeah

she's using you as a garbage bin yeah right for all the bad stuff and if you don't want me to think that you need to move on then I need to hear both sides of the story i need to hear the positive stuff and in that way it's a little bit more balanced and we're just normal people talking about day-to-day life and i i've dude i was bad about that i'd come home and tell my wife all the stuff the good but also man this guy did this and this guy did that until she finally said hey i i can't solve any of these problems but you're continuing just to come home and fill our communication with negative, negative, negative, negative, either quit. And when she said that, I was like, I don't want to quit.

And I realized, oh, all she's getting is the worst parts of the day. And that was on me. And I had to change that. But that took her drawing a boundary, a relational boundary saying, I can't, if you have something awful that you want to share with me that we're going to, that you want me to sit with you in it, we're going to grieve it because

we're getting ready to do something different. Awesome. I'm all in. But if it's just to complain, I'm kind of over that. I don't want to hear that all the time. Yeah. Because if you're going to complain that much, at some point you do have to take action. Right.

So it's like, it's the old piss or get off the pot kind of analogy. Can I say that, James? That's all right. Well, we just did. And you're, you're sitting there, you sitting there like you're about to get yourself kicked off the police force before you even join. You cannot assault this guy and like cuss him out in the parking lot.

Yeah. I do think a valid question is are you asking for my advice or my wisdom or do you just want me to listen? I love that. That's good, that. That's a question that will frame any of these conversations because if you want your opinion, she wants your opinion, you're

going to give it to her. But otherwise, I'm just going to sit here and I'm going to listen. And dude, I get it when somebody talks to your wife, you get all riled up like it's middle school again. It's her job. She's a professional. You trust her. She's smart. Let her handle her business. This is The Ramsey Show. This is The Ramsey Show. I'm Jade. Jade Warshaw. He's Dr. John Deloney. We're taking your calls all afternoon long. The number is EASY888-825-5225. And we will come on through with the advice for whatever questions that you ask. It's tax season.

And a lot of you guys have questions about taxes and we get it. Taxes are so confusing. I actually hate taxes. I'm gonna be honest about that. But to help you get a better handle on them, let's unpack some questions. A question from one of our listeners.

And hopefully you can kind of see yourself in this and maybe it'll help you. He says, I'm a new business owner. What are the most important things I need to do to make bookkeeping for my business easier? All right. First off, congratulations on starting a business. That's legit. I'm excited for you. And bookkeeping can be a lot. I'll be honest, when Sam and I had our business, he still runs it. I tried to be the bookkeeper for the first couple of years and it drove me crazy. But the good thing about when you try to do it yourself is you learn a little something. But if you're not ready, keeping your personal and your business expenses separate, you have to do that. If you're not doing that

already, that's numero uno. Keep those separate. And two, create a regular bookkeeping routine so that you're always on top of tracking your expenses, whether it's receipts, invoices, et cetera. That's thing number two. And then number three, try to automate any processes that you can by using accounting software or by working with a tax professional.

And number three is a real zinger. You need to do that. Like go ahead and spend the money on the software. Go ahead and spend the money on the tax professional. It's going to be worth it, and it's going to save you just a lot of stress and headaches. It can pay to have a CPA. I will say that. They can review your books and help you reduce risk. They can help you eliminate errors and maximize your tax deductions. Because I will also say this, the worst thing ever, is when you feel like you've done it. Like you've done it all right.

You've paid everything into the IRS. You've done everything right. And then you get a letter like later on that's like, hey, you owe X amount of dollars and it'll be from like quarter three, four years ago. And you're like, what am I supposed to do? That was explicits, by the way. If you can pay- there's a great meme

that's that says hi it's the irs you owe us uh an amount of money for taxes that we know and it's like what is that number we're not going to tell you you have to send us a number and we'll let you know if you go to jail or not right it's like so come on guys yeah it's crazy and so for that reason having and paying a cpa is totally worth it. It can be, which means you just can focus on growing your business and doing the stuff that you're really good at. A Ramsey trusted tax pro can help you. Our team has already vetted them. So you know that they're going to be top notch. If you are interested in that, go ahead and head to ramseysolutions.com slash tax pro to get started uh that's ramsaysolutions.com

slash tax pro do it today let's go to elizabeth in dallas texas man texas is blowing up the lines today what's going on hi um i thank you for taking my call number one um i really i need some guidance um i'm kind of late on the whole baby step situation. Okay. My dad passed away last May, and so we had a lot of financial things come through, and I saw what my mom was going through, and I was like, I don't want that to be me. So I'm just trying to kind of take charge, and I've paid off about $12,000 between a private student loan and a credit card, but I don't have that thousand dollar baby emergency fund. But so my

question is, I've got this, you know, my snowball going, I've got just under $80,000 of debt left. Most of that, about 71 of it is student loans. And then like 8,400 is a private, is a personal line of credit through my bank. Um, and so I've got, you know, my debt snowball going, but I don't want to, I want to do the steps. Um, and so what is, you know, I want to get back on track, you know, making sure I have that emergency fund in case something happens. So what are some, you know, some help to get back on track or to get on track? So what's keeping you from putting aside $1,000? You tell me. So I have been putting money towards a high yield savings account every month. OK. money towards a high yield savings account every month. Um, but in my, my brain was just like,

you know, the interest on this debt is killing me. You know, I want to put money towards the debt, but after I discovered the baby steps, I was like, Oh, so that's not the first step. The first step is, you know, going back and making that thousand dollar emergency fund. So I guess my question is, you know, should I go ahead and, you know, pause, just do my, my minimum payments and then, you know, put everything towards that savings account. I guess, I guess in my brain that would stack up the thousand to stack up the thousand dollars you're saying. Yeah. Yeah. I mean, I'm going to tell you to work the plan back to that

okay i'm gonna every time i'm gonna point back to the the steps and i'm gonna point to them in order because uh because elizabeth the point of it is to set you up with the best possible foundation possible and right now you're feeling that you're going man i've paid off some debt but if something were to happen i don't have a cushion there to help me out. And when you don't have that cushion there, what happens is people end up going back into debt because they get out a credit card or they do a line of credit to cover their emergencies instead of having a thousand dollars sitting there. That way, if something happens, they've got that thousand plus whatever they might take in from their paycheck that month. And they're able to cover basically anything that could possibly come up. So having that thousand dollars is super important. And remember, it's temporary, right? It's a temporary thing.

So yeah, I would say that if you can stack that up, most people can get it done in 30 days or less. Can you? I probably not 30 days. I could probably do it within three or four months though. What's something you could sell? Yeah. though. What's something you could sell? Yeah. I'm sorry? What's something you could sell? To be honest with you, I don't have a lot that I can sell. I travel for work. I'm a park ranger with the Texas Parks and Wildlife Department.

I've been very blessed. The car that I drive is totally paid for. I don't have a car payment on that, but it's my only transportation to work. But I'm basically using my income and I do have, I do my zero-based budget. I did start with that. That was my baseline. And so just putting,

I have specific money that I put towards savings every month. Yeah, but I have a flag to raise because you told me you've been putting money in this high yield savings. But then when I asked you how quickly you could save $1,000, you said four months. Well, right now with my budget, it's about $200 a month. That's the only margin you have? $200 a month? Right's the only margin you have? $200 a month? Right now, yeah. Yeah.

And that's just you making minimum payments? Yeah. Okay. So we need a bigger shovel because with $80,000, if you're paying $200 extra a month, we're going to be doing this until the Stone Age comes back. Okay. So we've got to get a bigger shovel. What are you earning right now? I don't even know what that means, Jade, but it sounds ominous. It means that the world has restarted again.

The Stone Age is back. That's some Flintstones apocalypse right there, dude. I just came up with that. Hey, what are you earning right now every month? I'm earning just over over 60 sorry uh per month it's about I'm bringing home $3,300 a month okay and tell me let's just quickly we got a little bit of time tell me what your rent is or what you're spending on living? My rent runs me about $1,500. Okay, that's a big issue. Okay.

And then I do a lot of cooking at home. I don't eat out, so my grocery budget is about $200. Okay, is there a paid-for car? Yeah, paid-for car. Okay, and are you pulling out anything for retirement? Is anything coming out of your check for retirement? Yes. Right now it's about, I have two Roths. It's after tax. Okay. And each of those is about $20 a month.

All right. It's not a lot of money, but you need to, again, with working the plan, we need to temporarily pause that and get that money coming back in. biggest thing here elizabeth is you gotta earn more money i know you're a park ranger that's a job you do because you love that job and you love that field and you're not earning a lot of money because of it you've got to pick up a second job and double your income because right now your rent is half your income and it's going to be almost impossible to make the headway you need to make with that sort of imbalance going on. So we're doubling the income. We're looking for a roommate and we're getting this debt paid off slowly but surely. This is The Ramsey Show.

Hey, you're listening to The Ramsey Show. I'm Jade Warshaw. Next to me is Dr. John Deloney. We're taking your calls for the rest of this hour. You can call in. The number is 888-825-5225. And the illustrious Austin Selby will pick up, and he will monitor to make sure you're not going to say something crazy on the air.

That dude is a lot of things. He is not illustrious. I mean, look at that beard. Look at it. Well, you can't see to say something crazy on the air. That dude is a lot of things. He is not illustrious. I mean, look at that beard. Look at it. Well, you can't see it, but I can see it. I can see it. I think you got it trimmed up at PetSmart. Oh, gosh, John.

Sheesh. I'm over here trying to give this man, throw this man a bone. See, exactly. Back at PetSmart. Back at PetSmart. Give us a call. The number is 888-825-5225 and a guy behind the glass with a beard will pick up and make sure that your call is safe and we have a couple of those on the line

now as it is we've got Jill in Reno Nevada what's going on Jill hi um I just found out that my husband's been opening credit cards. Oh, man. And he's racked up like $3,000 in credit card debt. On what? Do you know? Well, there's some online gambling. Yeah. There's some online prescription medication. And he knows I know we've already had our come to Jesus moment. I've got all. And to preface this, I have been complicit in this because I knew something was up and I've never wanted to deal with finances, but I'm on it now. So there's that.

Ownership is usually step one. So I'm proud of you for that. So just don't, just don't own it all. Cause he's, he's out there too. Good on you. So how can we help you? I don't want to be, I don't want to be codependent. Yeah. How can we help? Are like, Yeah. How can we help? He wanted to borrow from his retirement, and I said no, because I already cashed out mine for credit card debt before. before all of this you got to protect yourself i want you to call the credit the three credit reporting bureaus and i want you to put a freeze on your social security number okay so that no nothing can be opened up in your name that's not going to fully protect you because y'all are

married but that will at least stop him if he cares about you and your marriage he'll do the same thing he'll freeze it okay and that way they have to go through you for anybody to open up any more credit or to make any more charges okay okay yes um and that way that you're not you haven't slept because this thing is still spinning underneath you and you have a man in your home that you don't trust that is digging a hole um he's digging a grave for your family right and this at least takes the shovel out of his hand for a second so you can then begin to exhale and figure out what's your next step okay all right so we're going to call the credit that there's three reporting bureaus we're going to call them just google them uh experian i forgot off the top of my head uh equifax experian

transunion and transunion and call and just put a freeze on it okay so nobody's taking on any more Experian. I forgot off the top of my head. Equifax, Experian, TransUnion. TransUnion. And call and just put a freeze on it. So nobody's taking out any more credit. No one's racking up any more charges. Okay? Okay. And then no, we're not cashing out anything. We're not robbing Peter to pay Paul.

We're going to sit down. And while you're on the phone with those credit agencies, I want you to... And he's with you. We're going to sit down, and while you're on the phone with those credit agencies, I want you to, and he's with you, we're going to pull credit reports instantly, and we're going to find out how bad the damage is. I guarantee you it's worse than you think it is. Okay. It's almost never in this kind of situation when you catch somebody

is it all out on the table on conversation one. Almost never. Okay. And then, listen, I'm walking you through, okay? The next one is you can't have any sort of conversation, any sort of come to Jesus, any sort of healing conversation until he gets his addictions under control.

And that might mean rehab. That might mean AA. That might mean Gambler's Anonymous. That might mean he's got to go anonymous that might mean um he's got to go see a medical doctor because he's got himself hooked on pain pills but any sort of trying to heal this thing and come up with a plan and he's still using um is a fool's errand you're wasting your time i know because i'm a recovery medic there you go you know. You know. Yeah, you know. Yeah. My concern is here's so we have $33,000 in credit card debt. 3,000 of that is on is in my name only.

Hope I don't out myself here. I have a guaranteed income of $3,200. I can't work, but I have a guaranteed income of $3,200 a month. I get that every month. I was offered a buyout for that. I never took it. So I'm so grateful for that that I'm guaranteed that. My problem is he's in ministry, and he signed a covenant with his job, and I'm afraid that when this all clears in his head

and he realizes that he can't have this job, or they might ask him to step down. They have to ask. He has to step down they have to ask we're going to lose he has to step down as a matter of integrity he's not in shape to lead people as a minister right now period that means he's over his life is over as a minister no but he's got a mess in his home that he has created and he's got to get that cleaned up okay and maybe he takes a six-month leave and he sits down and says, I'm struggling with addiction. I've made some major mistakes, some major ethical violations of my own home,

and I need six months to go clean this. Maybe they'll do that for him or something like that. But yeah, this delusion, he's going to take down a whole church with him, and that's not fair to those people. He's not the leader later either way either way he's got to complain about this because the longer it's like leading a double life in that sense and i feel and i've discussed i've kind of tried to discuss it with him. My question, here's the question. I have, we have a $17,000 camper, or we owe $17,000 on it. I don't want to sell it because I might have to live in it.

I don't think that's true. Why might you have to live in it? That's not true. Because we won't be able to, we'll drown without him having a job. Okay. Can I ask the nature of your disability? Are you? Yeah.

I'm 100% disabled. Okay. Okay. Yeah. But can he go get a job at McDonald's and y'all get a one-bedroom apartment? Yeah. Well, if we sold the house, there's enough equity in my home to pay off everything that's that's all yes so don't let's don't go caustic because when we go caustic and we start imagining

us walking around in the aftermath of a nuclear strike we make decisions that don't make a lot of sense sell the camper take the 17 000 you guys got to start paying this stuff off well we just owe 17 000 i don't i won't i won't make any money on the camper i see what you're saying okay yeah $17,000, you guys got to start paying this stuff off. Well, we just owe $17,000. I won't make any money on the camper. I see what you're saying. Okay, yeah, then you got to stop the bleeding. You shouldn't have a camper, a $17,000 camper that's a depreciating asset that you're making payments on on a fixed income anyway. Mm-hmm.

Is that fair? Nothing's fair in this world there you go let me say this jill and i'm saying this because i love you okay most people in your situation are trying to walk around and if you've ever seen somebody in the aftermath after a tornado has come through a town they'll be picking up like a medicine cabinet and try to start putting it back on the wall but that wall is the only thing standing everything else in that it's just it's just how human nature and you have to come to the grief filled exhale moment where you drop your shoulders and you fall down on your knees and you internalize everything about your life is different now. And so there's not going to be a world where, but we hang on to the camper. Everything's different now. There's not a world where, but you still need to make this much money and we're going to

keep this house. It sounds like everything's over. Everything's different now. It's not over, but it's just going to be different for a while. Not how you drew it up, not how you wanted it to be. Hang on the line. I'm going to send you a copy of building a non-anxious life and own your past, change your future. Both roadmaps for people who have just found themselves completely in ash and trying to figure out what to do next. But y'all are going to have to sit down and have some real talk about getting clean, about coming clean with his workplace, and about what's the next logical right step. You're listening to The Ramsey Show.

I'm Jade Warshaw. John Deloney is right next to me. We're hosting the rest of this hour together. If you want to call us, you can. The number is 888-825-5225, and we will try our best to get to your call. Scripture and quote of the day. I say to you, asking it will be given to you. Seek and you will find. Knock and the door will be opened to you.

For everyone who asks receives. The one who seeks finds, and the one who knocks, the door will be opened. Luke 11, 9 through 10. Then Jimmy Buffett said this, searching is half the fun. Life is much more manageable when thought of as a scavenger hunt as opposed to a surprised party. Interesting.

Wasting away again. Margaritaville. He might've been in Margaritaville when he wrote that one, but let's go to Baltimore, Maryland and talk to Brittany. What's going on, Brittany? Yes, hi. So thanks for taking my call today.

My husband and I are in over our heads in debt at this moment. We've been trying to wrap our arms around it all, but it's coming from so many different places that it's, you know, it's overwhelming. So my question is, we both make up money. My job does a 9.3% match for 401k. I don't want to leave money on the table, but even with that high of a match, I'm not sure if it's the right move to keep investing that 10% each pay because we, you know we just i don't know if we can afford it but i don't want to leave the money on the table yeah so what what you're talking about

is we would advise if you're walking the baby steps we would advise for you to pause retirement until you've paid off your debt and until you've saved up three to six months and then you would come back and start investing 15 of your gross income every single month right that's that's what we're talking about here and so since you've got this match you're just worried that hey i'm going to miss out on my match and that's a lot of money because 9.3 match you know that that's that's not chump change let's be honest, right? Right. Yeah. What's your total debt profile? How bad is it? It's pretty bad. We have some tax debt.

We have credit card debt. We have a mortgage. Tell me real numbers. What's the taxes? Okay, so yeah, our mortgage is $3,213. And then we have... That's what you owe? Tell me what you owe.

Tell me the full balance. Oh, the full balance. We just moved. It's a brand new house. So it's about five. I think we probably owe, what, $520,000 ballpark. Okay. And what's the monthly payment?

$3,213. Okay. and twenty thousand ballpark okay and what's the monthly payment um three thousand two hundred and thirteen okay and tell me what do you bring home every month between you and your husband um both i probably bring home about um five thousand with with the 401k investment um and he brings home about eight thousand a month okay and then uh tell me about these this debt you have how much do you owe in taxes um so we have a text a prior year text at a 14k okay um we recently had some um like expenses that we didn't know we didn't expect so we had to put them on a credit card so we I have a credit card debt of, well, we have a credit card debt. One of the credit cards is $10,000. We have another credit card that's about $8,000.

And then small credit card debts, you know, anywhere between $200. Well, I'm sorry, anywhere between a thousand and eight thousand. How many of those? Those little guys. So probably about five of those. And we also have a loan that we took out when we when we moved. We're a family of six. So, you know, we had we got our dream home and we're just trying to make it a home.

No, it's not a dream home. Hey, I'm gonna break this up. This is not a dream home hey i'm gonna break this up this is not a dream this is a nightmare um and you're feeling that i can't i can't understand why you would go out and buy a half a million dollar home when you're struggling with this debt and then you add you add that on top of it and it's just more and more and more i think that you guys have the ability to have a really great life. You've got a great income.

And I kind of think at some point that crept in your mind like, yeah, like we're living now, like it's time to ball out. And you guys went to an extreme that you just can't afford. You can have a really great life on $13,000 a month. And I think that you guys just went to an extreme to where it became too much. And you just got to pull it back a little bit i that lifestyle creep has gotten the best of you to where you're putting things on credit cards when you should have the margin to really float just about anything that comes your way how many kids do you guys have we have four four kids okay um so total debt not including the mortgage, how much would you say that you have?

Total debt? We're probably, we might be 50 grand. 50 grand. Okay. Yeah. You're going to have to pull back and stuff like that, but it's just overwhelming. And then our monthly, our minimum, they change each month, so it's hard to anticipate. So we just don't know how. We just don't know. Well, Excel, let's be honest, it's not the best way to budget. The best way to budget truly is with an app like EveryDollar because it's very, very, very intuitive. You're talking to a person that, I'll be honest, I work on a money show, but I don't like math. I don't like having to crunch numbers and do everything like that. And EveryDollar is great because it does it for you. You put your income in at the top and you plug in all the things that you could possibly think

that you're going to spend money on for the month. It does the math for you. And so I think that for you guys, being on a budget is going to give you a plan for every single month. It does the math for you. And so I think that for you guys being on a budget is going to give you a plan for every single month. And it's going to help you see how you've been spending your money. And you're going to see, okay, like we've been throwing away a lot, hundreds, maybe even thousands of dollars on lifestyle things, right? Things for the kids, going out to dinner, picking up lunch over here. And you're going to find that there's a lot more money sitting there that you have at your disposal to pay off this debt you're in this house now the payment's fine i'm guessing it's on a 15 year fixed right no it's on a 30 you're in it

it's on a 30 but we did we bought it during covid so our interest rate is super low i think it's like two point something yeah Yeah. All right. Well, here we are. So you've got to decide what you guys are going to do. You guys, this is a behavior issue more so than it's a money issue, a behavior issue that's turned into a money issue. And you guys, I say this all the time and I want you to internalize this. It's going to feel harder. It's harder when you feel like i've got the job everybody sees i've got this job i've made it clear that i'm making some money when you're in that situation and you have to start pulling back you feel it even more because you've created the standard of lifestyle and it's hard to pull back from tahos and escalades and five hundred thousand

dollar houses right but you guys are gonna feel that i mean john you can chime in here i just i britney i'll say it just as direct as i can because i love you y'all are broke y'all make so much money and you're broke you owe fifty thousand dollars spread across credit cards personal loans adjustable rate um aprs what an exhausting mess on top of four kids fair right i agree what about the cars yeah what about cars with a lifestyle like this you guys got cars too yeah no we just had um what we have my car which is paid off it's 10 years old i've had it since college there you go yeah and then we got we just got a van because we needed it for the kids so we owe um 17 000 on that so that's part of the 52 but we that was you

know a necessity we did need that when you said when you said it was overwhelming was the was was it overwhelming because your husband won't sit down and talk to you about it was it overwhelming because it just feels like there's so many bills and so many different places coming from all different angles or is it overwhelming because like jade said y'all finally made it you're a six-figure family and there's this lie out there that once you make six figures that you don't ever have to say the word no anymore. Was that overwhelming, like, oh, we're going to have to really bite the bullet for a couple years? Yeah, I think it was the second and third.

My husband is off. He's the one pushing me to buckle down. He is the one mapping it all out. I want to paint you a picture, Brittany, okay? Okay. Imagine you just sleep at night. Imagine you get up and have a cup of coffee because you want to,

not because you're so stressed. Imagine your kids are goofy and y'all are laughing because you don't owe anybody anything. It's freedom. That's what we're talking about. That's it. So before you get off the line, Austin's going to pick up. He's going to give you Ramsey Plus. And in that, you're going to find EveryDollar, which is the app that I was talking about. You're going to have a couple of months of a premium version of that so you can get this on track. It's going to have Financial

Peace University in there, access to some coaches in there. Ut this on track. It's going to have Financial Peace University in there, access to some coaches in there. Utilize this. It's going to help you get your mind right so that you can play this game over the long haul and actually get yourself out of debt. This is The Ramsey Show. Hey folks, Dave here.

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