The Ramsey Show - Don’t Overcomplicate Building Wealth, Keep It Simple

Episode Date: December 6, 2024

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Live from the Ramsey Network, this is The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm Ramsey Personality, George Campbell, joined by my good friend, Dr. John Deloney. We're taking your calls at triple 8, 825-5225. You call us, we'll try to help you take the right next step for your life, your relationships, and your money. Lucas is gonna kick us off in Grand Junction, Colorado.

What's going on, Lucas? Hey, how are you guys? Doing well, how are you? How can we help? Good. I'm trying to sit down and go through a budget and start making a monthly plan. My wife and I have both gone through financial peace university together. My income has changed since we've done that. I get paid basically daily. So how do I kind of set up my monthly budget for, for something like that?

Cause my budget or my income is very, it fluctuates a lot from summertime to wintertime. So how do I set up a budget for something like that? What do you do that you get paid daily? Are you slinging rocks? I'm a farrier. I trim and shoe horses. Oh, dude. Okay. So I get paid. That's amazing.

Yeah, that's way better than selling drugs. I love that. Okay, good. So do you like go, do people that's way better than selling drugs. I love that. Okay, good. So do you like go, do people call you out to their farms and you go out there and take care of them? Are there horse ranches? Yeah. Dude, good on you, man.

Awesome. So I love that you're still doing a budget because a lot of people think, well, budgets are for people with consistent incomes. And you definitely need a budget if you have an irregular income. And so here's how I would set it up. You need to make a prioritized spending plan. So you know it's not going to be a zero dollar month. So what's been your worst month in the last

six months? My worst month probably five thousand gross. Okay. And what's been your best month? 16,000. Amazing. And what are your monthly best month? $16,000. Amazing. And what are your monthly expenses? What do you need to just cover all of your basic bills? Food, utilities, housing, transportation, insurance? About $6,500.

Okay. So you can do what I call a peaks and valleys fund. So if you have a great month, like $16,000, well, you don't need it all. So we can park that in a separate savings account to cover the leaner $5,000 month where we're 1,500 bucks short. Make sense? Okay. And as you go out, you know, go throughout the month tracking your transactions,

you're gonna prioritize what you need to cover. So first up, food, utilities, housing, transportation. If we have all of those covered and we still have money left over, we go to the next priority, in the next priority. And at the very bottom will be the life's little luxuries, your subscriptions or whatever the fun things are, your hobbies.

Okay. And that way you know you're gonna cover all the major bills. And if you're able to cover more and put extra in savings and hit your other goals, that's great. But that'll allow you to make sure that you don't have a month where you're behind and then need to go into debt to do it.

Hey Lucas, hang on the line here because I want to ask George a question on your behalf. So George, so you have a peak in Valley Fund and let's say, it feels like in my head it would be smart to have a line that when you cross that line, there's a chunk of money that you decided what to do with. So let's say his lowest month he had last year was five,

his highest was 16, but he averages 12, right? And so he's going to continue to move this money over there and money over there. Does it make sense to say, okay, when we get 25,000 or 10,000, we're going to stop and either move that to X or move that to Y? Like, you see what I'm saying? Yeah. Well, this largely depends on where you're at in the baby steps, Lucas. So are you debt-free with a fully funded emergency fund or are you working to pay off debt? We're working to pay off debt?

We're working to pay off some debt. We don't have a bunch. The only thing we have left is like two small personal loans and a vehicle loan in the house. Okay, and what do you have in savings right now? For your emergency. Right now we're slim, we just got through a remodel, so we're less than a thousand in savings right now. Okay, so your A1 goal with any extra money

beyond basic bills is to fill up that thousand dollar starter emergency fund. Beyond that, any extra money beyond your basic bills goes toward debt payoff. Then once you have the debt paid off, it goes toward the emergency fund. Then when you're in baby step four through seven, you have more margin.

And so like John said, this is where you can decide, hey, our next goal is going to be paying off the house early or we're gonna just stash money away, to where maybe you have an extra three months of expenses to cover you for those leaner months. Okay, okay. The way to go, you're crushing it, man. Five to 16 grand is quite the spread there.

Yeah, dude, I follow an Instagram account, and all that guy does on this Instagram account is takes horses' hooves that like infected or messed up and he cleans them all up and makes them amazing and I'm just mesmerized by it. So cool dude. How long have you been doing that? It's a fun job. About 10 years. How many times have you been kicked? A lot. A lot. Not by your not by your wife but by your by these horses. Yeah exactly. You ever encounter people, Lucas, who maybe should sell the horse? Just curious. All the time. Thank you for that. That's all we needed. No further questions,

Your Honor. Yes. There's people who have horses who shouldn't. And a lot of people who don't deserve horses and don't need them. Yeah. Wow. All right. So I got you a more equine question. It's an equine theme hour here on the Ramsay Show. Listen, Lucas, we got you. We helped you out, so you have to help us out. There's a mystique around horses. Is it real? Are they like a magic animal in some sense? You know, the way they are, there's a connection that you get between a person and a horse that actually does have that connection. Their personal animal are kind of like a, you know, you know, kind of like a dog. They get to get to know their person and you have a connection with that horse and there's a lot to them. But yeah, they're a very sensitive animal. They can feel

every emotion that you're feeling and it adds to the experience around them. If somebody had a deep personal connection with a horse and they were struggling financially and somebody just popped in their ear and was like you should sell that horse right away. That'd be kind of cruel right? Yeah it's hard to do. I mean I've had some pretty lean financial years and it's hard to think about getting rid of the horses. There you go. Just wanted to make sure. I have a friend named Corge Jamel and he did that one time and it was pretty tough so. It wasn't in front of millions though. Yeah, it was in front of a whole bunch of people. But hey Lucas, I appreciate the work that you're doing,

brother, that's awesome. Thanks man, thanks for the call. It's a great question, John. A lot of people, when they look at budgeting, they opt out because they go, well, that's for a certain type of person. It's for broke people. It's for people who have a lot of money.

It's for people who have consistent income. And what I found over time is it's for people who want to know where their money's going and want lot of money. It's for people who have consistent income. And what I found over time is it's for people who want to know where their money's going and want more of it. Yeah and I don't, you can tell me if I'm wrong here, but it feels like especially as the world has moved almost overnight to this gig economy where everybody's got a job and then a side hustle and then another side hustle. If you're making $250,000 and you're gonna fudge here and around the edges, okay. If the $14 you just earned that hour is going to a bill, you have extra, you better be paying attention to every dollar, right? Like watching every penny. Yeah. And so it matters more when you're that tight. Yes. And so if you're getting paid every day like he is, if you are working these gig jobs

where you're measuring mileage, it's on to you to pay extra special attention to every penny, every dollar, wherever you happen to be, and that's how you're gonna get ahead, especially on this day-to-day, by day-by-day basis. Absolutely, and I see Lucas is still on the line, so I'm gonna gift him one year of every dollar premium, and I hope that helps him with this inconsistent budgeting.

We have a paycheck planning tool as part of the premium version, John, where you can lay out all your bills. It'll show you when your money's gonna run out based on when all your bills hit. So it's a super helpful tool to visualize, then you can start moving your bills around and figure out, okay, I need more money

after the bills than before it, so I don't run out. So there's a lot of cool features there. Go check out EveryDollar. You can download it for free in the App Store or Google Play, or just click the link in the description if you're listening on YouTube or podcast. And whether you are broke, you consider yourself wealthy, you have regular, consistent income,

irregular income from commission jobs, you need a budget. If you are a human being who has bills to pay, you need a budget yesterday. So go download every dollar. It will solve that problem. And then your job is to stick to it, to track those transactions and to take control of your money instead of it controlling you.

This is the Ramsey Show. Hey you guys. I'm not a fan of the big banks and you probably already know which ones I mean. But I do like credit unions because they're non-profit organizations that focus on their members. And I'm proud to endorse Fairwinds Credit Union because they share the Ramsey mission of helping people get out of debt and live generously. In fact, they

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at the combined checking and savings account bundle they created just for Ramsey fans to help you take control of your finances. That's fair wins. F-A-I-R-W-I-N-D-S dot org slash Ramsey. Welcome back to The Ramsey Show. I'm George Campbell joined by Dr. John Belloni. Open phones at triple eight eight two five five two two five. Christina joins us next in Florence, South Carolina. Christina, welcome next in Florence, South Carolina. Christina, welcome to The Ramsey Show. Hey, thank you guys so much. I appreciate your time.

What's going on? So in 2018, I was diagnosed with breast cancer and was out of work. And unfortunately, over the time period that the company I work for allowed so after 20 years of service they called and told me they no longer needed me. So I have 401k with that company I know I should have done something with it and I did not so it is sitting in an account and I was just diagnosed in the past year with stage 4 cancer. So now instead of preparing for my retirement, I am

looking to see the best way possible to leave this money for my family. I want to make sure that tax wise or whatever penalty that can be made, it gets the less hit. I would like them to have the most of it. So how certain of you about your new contracted timeline for just being around? I would say I've only been given that by one doctor and I would say we're looking at within a year Do you feel pretty confident about that? I Believe in a big God and I know that he can do big miracles

So no, I don't believe that however. I am doing everything possible to make sure if anything does happen That I leave my family You know Having having the most that they can. Yeah, you're a pretty amazing woman Christina Yeah to be thinking about your 401k beneficiaries when you're going through something like this Speaks volumes to the kind of person you are. I want you to... I'm gonna assume you've got longer than a year, but I'm gonna pretend like you are,

that we're gonna go ahead and do those things just in case, okay? Okay. Thank you. I want you to never say the words I should have again. Okay. Literally, life is too short. Okay. You're right. We're not gonna say I. Okay, you're right. We're not gonna say I should've, I needed to.

We're just gonna do the next right thing. Okay? Okay. So we're gonna let old Christina, who is trying to survive getting hit in the mouth with a cancer diagnosis the first round, we're gonna let her off though. She's tired. Okay.

Is that cool? Thank you. That's cool. So no more shoulds. It's just gonna be the next right thing. I'm assuming you're a list maker. Have you made a list of all the things you need to go do? I have yeah. Okay. I want you to put at the top of that list Things that bring me joy and laughter Okay, and I don't know what that means for you for me

It would probably just be Will Ferrell shows and playing with babies and hanging out with my kids and my wife I don't know in puppies, everybody's different, okay? George would just be smashing Android phones. That would bring him the most joy he could possibly have. Not a bad idea. Right? But I want you to put that at the top. Okay.

The greatest gift you can give to your loved ones in this season is to find joy where you can. Okay. And then we'll do these tasks as they pop up. And this is one of those tasks, okay? I'd recommend you get a SmartVestor Pro if you haven't already and just consolidate this stuff as quickly as you can into a single account. And if you've got multiple, like when I moved to Ramsey I had left three or four other jobs, I had 401s everywhere. So I called

my SmartVestor Pro and we gathered them all up into one central place. And it took like, I mean, he did it in no time. And that's a direct rollover. So you're not actually withdrawing the money, you're just directly rolling it over to an IRA from that 401k. So there won't be any penalties or taxes there.

Do you know if the 401k was traditional or Roth? I don't. Okay. There might be a little bit of homework just to figure out, you know, if it's traditional 401k was traditional or Roth? I don't. Okay. There might be a little bit of homework just to figure out, you know, if it's traditional 401k, that means you haven't paid taxes on the money yet. And so you're, you know, whoever inherits it, we'll have to pay income taxes on it.

That's fine. Someone was gonna have to do it at some point. If it's Roth, it means you already paid taxes on it. And therefore when they inherit it, it'll be tax-free. Okay. But there's not gonna be penalties or anything like that with an inherited retirement account. Now, who would be the beneficiary on this account? Who would be getting this money if you passed?

It would be my husband and my daughter. Okay, so if it's your husband, there's different rules. He will likely be able to roll that money into his own account and there won't be the 10 year withdrawal period. If it goes to a non-spouse, they'll have 10 years to withdraw the funds based on the Secure 2.0 Act.

And again, a SmartVestor Pro can walk you through all the nerdy ins and outs of this. The key is just to check who is the beneficiary of this account. Is it the person I want? Okay, so I should, probably my husband, if I want them to have access to money within 10 years. Yes, if it was me I would unless you have reason not to give this money to your husband that would be the next in line I would be passing this money to.

Yes, and if by splitting it you're going to make things way more complicated for him when you pass away. Do you have a will in place? I'm working on it. Okay. Hold on, no. Before the weekend is over, at least go to Mama Bear Will and get a will, okay? Okay. Yep.

And we'll hang on the line. We're going to help you out. We'll hook you up. Kelly's going to hang on the line and we're going to gift you as much as we can to help you with this process. But Mama Bear Legal Forms, they're the folks that John and I have our wills through. It's online. It's all ironclad.

It's legit. And so get your will back. Well, let me say, that's who I got it wheels through. It's online, it's all iron clad, it's legit. And so, get your wheel back. Well, let me say, that's who I got it when I moved from Texas to Tennessee. And I went and got a mama bear wheel because I've moved states. And then I recently have sat down with an estate planning attorney, my wife and I did, and we went through the whole rigmaroo. And he was awesome. He was awesome. He's here in Nashville. But getting a thing right now, just in case. and then sit down with an estate planning attorney with you and your husband. Okay. And earlier I want to reiterate, George asked you is this in a Roth or is it traditional 401? And your response was this,

I don't know. You're not failing anything. It's not a pop quiz. Okay? 99% of America doesn't know the answer to these questions. That's why the show exists. Okay? Okay. The least amount of beating yourself up you can do over the next year, the better. Okay. And the least amount of brain calories

you can spend on stupid stuff like this, the better. And that's why it's wise to reach out to a smartwester pro who goes, hey, don't worry about it. Let me explain it to you in a way that I can teach you, you can understand it, but you don't have to worry about it yourself. Okay, all right. Is that cool?

What else we got? What else we can help you with? Do you have any term life insurance in place? Through my husband's job, I think. Okay. And you probably wouldn't qualify for any other. Yeah. Yeah, the big question is, is my family gonna be okay if something were to happen to me?

And it sounds like the answer is yes, they're gonna be okay Okay. I one more question is is is there a penalty? someone tell me that there is a law that passed that if you If something like this happens to you that you can withdraw your money early with no penalty. There are probably, it would probably constitute as a kind of a hardship withdrawal. I still wouldn't do it. Okay.

Even if you're able to. Are there pressing financial things that you guys are trying to pay off, debts, things like that? No, no. Okay. No, there's not. I would leave it sitting there because it's gonna grow

and continue to grow with compound growth. I don't want you to unplug that, regardless of what the penalties are. You've worked really hard to establish this level of wealth for your family and there's no need to withdraw it early. Okay, okay. All right. All right, can I give you one piece of magic advice?

Yes. I don't think it's going to be, but you get a rare gift that most of us just blow by. You get a rare gift to at least consider this might be the last Christmas you sit around the tree. Soak up every minute of it. Yes. Every minute. Yes. Go on the vacation. Go do the silly things. Yep. Throw water balloons at your daughter when she gets home from school. Do all the stuff.

We're headed to New York in a week. Fine. Go. Never done that before. That's amazing. Write the letter. Make sure she's got something to read forever and ever and ever. Okay?

You're a brave, brave, brave woman. Thank you for sharing your bravery with us. Thank you, Christina. We're pulling for you and we hope there's only good news in the future. Call us back if we can help in any other way and hang on the line. Kelly's gonna pick up and make sure that you have what you need with all the links and goodies to take the next steps. For all the men and women listening out here, we all have our last day and you just heard what bravery

looks like. Someone who says, okay, it's common. I want to make sure whether I know what day it is or it might be 50 years in the future I'm gonna do the best I can to make sure those that I love who are left when I'm gone are taken care of that's what that sounds like right there. It's a life well lived. This is the Ramsey Show. This show is sponsored by Better Health. Alright hey it's that time of year when it's getting a little colder, it's getting dark earlier, and sometimes we just want to stay inside and get cozy. For me, the perfect night at home when I'm trying to be cozy is me and my whole family

under a bunch of big blankets watching a TV show or reading a book. Whatever your perfect night in looks like, therapy can feel a bit like that. A time when you can settle in, get cozy, replenish your energy, and take care of yourself. Therapy is a great way to bring yourself some comfort, especially during the chaos and rush of the holiday season or any other time of year. Taking the time to pause and be mindful is one of the reasons I recommend BetterHelp. BetterHelp is 100% online therapy with licensed therapists. You can talk with your therapist just about anywhere so it's convenient for your schedule. Just fill out a short online survey to

get matched with the therapist and you can switch therapists at any time for no extra cost. Find comfort this December with BetterHelp. Visit betterhelp.com slash deloney to get 10% off your first month. That's betterhelp.com slash deloney. Welcome back to The Ramsey Show. I'm George Campbell joined by Dr. John Deloney. Friendly reminder that you can watch the show live just south of Nashville, Tennessee, if you're making your way through town. We got a lovely audience here today.

And as the holidays approach, if you're coming through, come visit us. The show is free to watch through the glass. We're like zoo animals out here. We got free coffee and baked goods in the cafe. And you can leave with a free Ramsey Show mug. So come see us. We've got Mason up next in Henrietta, Oklahoma. What's going on, Mason?

Hey, George and Dr. John. How are y'all? Doing well. How are you? I'm pretty good, I'd say. So my question is, I have a sister and a cousin that are in a position in life where they're getting ready to start getting their first cars and jobs and things like that. And I recently, last couple months, started listening to the show and got really into it. And I haven't fully started the baby steps yet.

I've wanted to, I just haven't made that leave yet. And I'm just wondering how do I convince them, because I can't deal with my life right now necessarily but how would I convince them that doing things with cash and not worrying about credit scores and things like that are the way to go. So you're not doing the plan but you want to convince others to do the plan is that the summary here? Yes. You're excited about the plan and you want them to be excited about the plan. Mason, this is the most America call I've ever received. Like, we really want to do a thing that none of us are doing.

So y'all do this thing. I think the, uh, as the great country lyric goes, you say it best when you say nothing at all, Mason. Just start paying with cash. Just start getting connected with your wife. Your actions will speak louder than words. If you roll up in there like, y'all need to start paying cash and getting rid of your debts. How about you just go, yeah, what'd you do today? Oh, I paid off my car. Felt pretty good. How'd you do that? Well, I followed

this plan. And then if they're interested, they'll listen. But I've never been able to convince someone of something they were not interested in. You just have to lead with intrigue and they have to go, tell me more about this. So why haven't you started yet, Mason, if it's such a great plan? Well, I mean, I don't know.

I just haven't. I mean, I guess technically I'd be in beg to step one. I just haven't. Yeah, I've got the, the every dollar I've started the budget and I'm getting stuff lined out I just need to start putting that first thousand dollars together and then I'll be going on it I know but you didn't answer my question if this is so great that you want all your friends and family to get involved why haven't you your friends and family to get involved? Why haven't you? Hesitant? No, I don't know. I don't think hesitation would be it. I think it's just

uh, I don't know. I think today's your day. Yeah, where are you at financially? Um, not terrible. Great answer. Love the conversation. If I was like, hey John, how's your marriage? And John said, not terrible. That means it's not great. So how much money do you make? Maybe around forty thousand. Okay, and how much debt do you have?

About thirty eight thousand probably. So Mason, that's 100% leverage. That qualifies as terrible. It's not great. How'd you get into this mess? You sound young, how old are you? 22. Oh yeah, I was actually about where you were at 22. I was $36,000 in debt with student loans,

$4,000 in credit card debt. And I was making about what you were making. Where's your debt come from, brother? Um, so I have a truck I have about $9,400 on. And then we had, we were pretty close to paying off my wife's car. And then before we really got into all this, we got another car. You have three cars? No, just two. Okay. into all this, we've got another car. You have three cars? No, just two. Okay.

The other one, no, the other one we got rid of now, but my truck and her car together is about 95 and 16.5. Is she working outside the home? Not as of yet. We had a nine-month-old little girl and she's in her EMT school. So once she gets out of that, we're gonna be looking into.

Okay, how much debt does she have? Does that include in your 38 or is that just your debt? Technically, we're married, but technically, I guess it would all be mine, the ours, but she's got a couple of collections from before we were married that are like a thousand dollars or something but Well her problems became your problems as soon as you said I do so we got to get all of this Listed all out smallest to largest. I don't care whose debt it is

I don't care what the interest rate is listed out by smallest balance to largest balance and let's start attacking these debts aggressively with the debt snowball right, I got my every dollar budget set up as far as our monthly payments and I just, yet last night actually, wrote everything down on paper to look at. And when you see between the small things and the vehicles that adds up to $38,000, it's a little bit, takes your breath away a little bit, I think. Mason, how quick can you get $1,000? Stop thinking about it and stop making lists. How quick can you get a thousand dollars? me a month maybe I bet you can do it faster. What can you sell?

You got some toys popped in your head that guitar that tool thing that what you can sell it four by four I mean, honestly, I don't, we don't keep a whole lot of like just things around. I want you to put two week time limit on yourself and go get a thousand dollars. You got two expensive cars sitting in that driveway, man. That's more than half your income. Yeah.

Just depreciating every single day, continuing to go further down in value. I would consider selling your wife's car or yours, but it sounds like hers is worth more with a bigger payment. Yeah, true. And could you then downgrade in car and get something for six grand while you get out of debt and then upgrade later a year or two from now? That's the kind of sacrifice that would get your family talking. They're gonna, do you see what they, they sold her car and got this crummy little beater car.

What are they doing? So when Dave says the words gazelle intense, he's been saying that forever. When a lion shoots out of the brush after a gazelle, a gazelle does not just sit around and like for a couple of months and like make a plan and like talk to the family. Like, are you you guys gonna run? I'm thinking about running. The Gazelle just starts running for its life. And until you get that kind of intensity, brother,

you're gonna be 22, you're gonna have a nine month old, you're gonna have a wife, and you're gonna be scared to death. Like you are right now, I can hear it on you. Yeah, I'm also nervous. I know. Being on. We're not that, don't be nervous, we're not that great.

We're not that good. But you see what I'm saying? Like, I want you to get fired up on behalf of the world you're gonna create for your daughter that you didn't have, which is a house that doesn't owe anybody anything. Can you imagine that? Yeah.

Is your wife even on board? That would be my A1. I don't give a rip what your uncle Larry's doing. I want to know if your wife is willing to make the sacrifices needed. She definitely likes the idea of it and we've talked about it. She makes fun of me a little bit because I talk about it so much because I got my head spins whenever I get involved in things like this and I'm excited about something my head spins and it's like a burnout essentially. I don't You know, it's all throttle no actual forward movement yet

and she's just was telling me last night as well when we were talking about the debts that uh she wanted to start listening to the podcast and you know get into it and see what it's all about and So we can really kind of lock hands and go forward with it. I and so we can really kind of lock hands and go forward with it. I think it's time to get on it, brother. I think it's time to get on it and tell her in two weeks I'm going to have a thousand dollars. We have an emergency fund and we're going to stop using these credit cards and we're going to start knocking them off. We're going to list our debts smallest to largest and get out of this mess.

No more games, man. I'm going to change what you call rage. Tray this roof off like two dogs caged. You hear that? That's exactly right. There we go. There we go, Mason. He knows what to do, John. It's just, how would you find the motivation to do it? It's like, I love the idea of this Ramsey plan. That sounds so cool, getting out of debt.

And then you just get paralyzed. Yeah, you have to lose yourself for the music in the moment. You have to just own it. Well, it's weird to think about, like you really do have one opportunity to seize everything you wanted, one moment. Well, I mean, you have multiple opportunities opportunities you just have to go for it right?

I mean this one life this one crazy life you have like would you capture it or would you just let it slip? Oh that's a good question. No yeah you gotta you gotta you just have to you have to lose yourself in the music in that moment. That's just how it's going to be. That's just how it's going to be. I don't know what else to tell you. Go go go go go. Mason stop sitting around thinking about it and talking about it go get it. Yeah you're sitting over there your palms are sweaty knees weak arms are heavy. Let's go, let's go, let's go. Let's just go for it, man.

Debt freedom is on the other side. What are you waiting for? Tell your wife, tell the kids, hide the wife, hide the kids. I don't care. Just follow the Ramsey plan and call us back when you're debt free and we will celebrate with you, my man. This is The Ramsey Show. Hey guys, I've never done this before, but I'm partnering with a nutrition company, Field

of Greens. Each fruit and vegetable in Field of Greens is selected by doctors to support heart, liver and kidney health plus metabolism for healthy weight. And your doctor will notice your improved health or Field of Greens will give you your money back. I can get behind a promise like that. Go to www.fieldofgreens.com slash ramsey and get 15% off with promo code ramsey fieldofgreens.com slash ramsey. Welcome back to the Ramsey show.

I'm George Campbell joined by Dr. John Delaney open phones at triple eight eight two five five two two five. You know, John, over the, we talk a lot about habits of the wealthy. Dave has always said, you wanna be wealthy, do what wealthy people do. You wanna be broke, do what broke people do. That's normal. So I thought it'd be fun to go through some of the actual habits

so that people can identify where they're at. Whether or not they feel broke or feel wealthy, if you do these habits, you probably fall into these categories. You ready for this? So here's what broke people do, payday loans. We see these in zip codes with lower incomes. You see these payday,

they look like old pizza huts a lot of the time, there's TitleMax and payday loans. These are some of the worst. The interest rates when you actually do the math are astronomical and it keeps people in a cycle of debt with these short-term crazy high loans. Interest rates average 400%. So it keeps them chained.

Title loans is another one. We mentioned that high interest loans that require your car as collateral because you have the title of the car. Buy here, pay here, car lots. You've seen the, we tote the note. That's never a good sign. Cash advance, that's another short-term high interest loan

against expected income. Are you seeing a theme here? Rent to own. So again, they go, well, I'll at least be paying towards something. But most of these have crazy hidden fees. And it might sound like a good idea, but it preys on people who have poor credit

and can't come up with the money. And then finally, the lottery. This is known as a tax on the poor. It's a regressive tax. And if you look at who's playing the lottery, it's not people making $100,000. It's people who can barely afford to cover the bills and they're hoping with false hope,

this is gonna be their ticket out. So it sounds like here, it's a, like what you just described, if I was to like put a theme over it is, desperate, I gotta get through today. It's desperation. I just gotta get through this afternoon. Yeah.

And if you are constantly waking up on a treadmill of, I gotta get through this afternoon, I gotta get through this afternoon, there's plenty of people out there that are ready to prey on you. Yeah, but here's the deal. Most people fall into this next category, which is average. Okay. Normal. And here's what average people do. They chase credit card rewards. How many times have

we gotten this call? Well, I really, you are spending so many brain calories chasing these rewards and the companies love it that you think you're winning, that you think you're gaming the system. Recent survey shows 23% of people didn't even redeem the rewards in the last 12 months. And there's a reason they went away from cash back. Now it's, well, you're going to have a bajillion points. What are those points worth? It's like a Chuck-E-Cheese. You have all these tickets that can't even buy you a, you know, one of those little sticky hands. It's ridiculous. Well, and the number of things I've bought for Christmas for people online, I get so many emails back

that's like, you've now got five points with whatever shoes and five X the point. Like what? I don't even know what that means. It's all been gamified. I don't know what you're talking about. Yep. The next one on the list, this is what average people do.

They buy new cars. And they go, well, John, it's gonna last longer. It's safer. It's more reliable for my family. Just admit it's for your ego. Just admit that. Used cars are less expensive, you've already taken the hit on depreciation,

you let someone else do it. We know new cars drop 60% in value in the first five years. We know the average new car payment is now over $700 a month. And if you're leasing a car because you think it's somehow smarter, you're the dummy here. You're just renting very expensively

and you're prepaying all of that depreciation. You're paying the dealership's depreciation for them on the vehicle they just bought. But John, I don't have to do anything. They include the insurance and... Okay, keep telling yourself that, buddy. Next up on the list is HELOX. We've seen a big rise in HELOX over the last few years

because people have all this home equity and they get marketed to and they say, hey, this is basically a credit card attached to the value of your home. You're not actually borrowing money, you're borrowing it from yourself, John. It's a great plan. And what are the calls we get?

Hey, we're stuck because we have a HELOC on top of the mortgage and it's killing us. And most of these HELOCs have a variable interest rate and you're putting your home at risk and your family at risk by doing this. And of course the next one, this is part of the, you know, the American stew here,

we got the student loans. To give a 17 or 18 year old hundreds of thousands of dollars for their business idea of getting this degree to hopefully have marketplace ROI. Be passionate about it. Oh my goodness. When you're 18, I can't even say on the air what I was passionate about when I was 18.

I'm just glad I didn't get $100,000 to pursue it. We shouldn't, if it was a business, we'd all go at the bank, the bank would go, this is a terrible business idea. What are you gonna do with a sociology degree? Socio stuff, don't do this. There's no way out. Student loans are not discharged by declaring bankruptcy.

So you can't even get out of this thing from bankruptcy. The next one that we get a lot of, and this is a very middle-class move, is buying whole life insurance. And it's some dude from college who's like, hey, did you know this is what the wealthy do? They buy life insurance and they borrow against it and it's tax-free.

It's a wealth hack. And I go, dude, this guy just scammed you into thinking that you should be investing through your insurance. Think about how dumb that sounds, that you're using your insurance as an investment tool. It's super expensive, and we know that term life is a fraction of the cost, and you can invest the difference and be way better off than giving someone fat commissions.

And then finally, buy now, pay later. This is one we see average people do. I just saw this on a website, John. It said it was $140 for this pajama set. And then underneath it had the girl math of 36 cents per night. They divided it out over a year and said, well listen, it's 36 cents a night.

And if you wear it every night, I mean you're basically making money off of that. So it's insane what they're doing with buy now pay later with the marketing tactics. I like this here, it says the average person asks, how much does that cost? They ask how much is it gonna cost me a month? And can I make this pile of monthly payments,

can I make that less than I make? And people feel like I'm spending less than I make, I'm living less than I earn, when their payments all add up to that, not the total purchases. That's right. Broke people ask how much down, how much a month. Wealthy people just ask how much.

How much? What is the out the door cost? What is the total? And if I can't afford it today in full, in cash, don't do it. That's a surefire way to be wealthy. So this is what wealthy people do. Number one, they don't pay interest.

We've said this, broke people pay interest, wealthy people earn it. That's what they're doing. They're investing in assets through real estate, through mutual funds, whatever it is, and that's giving them money. Broke people buy things that go down in value and take their money through interest.

And so that is a big thing. Their goal is to have assets, not liabilities. Another thing wealthy people do is they buy used cars. Even those that have the money to buy a new car in cash and they could light that money on fire on the kitchen table and it wouldn't mess with their world, they still go, why would I take the hit on depreciation instead of someone else and buy a four-year-old car? Here's what our millionaire study found. Most millionaires are driving Hondas and Toyotas, Not crazy luxury cars, not Lamborghinis. Our millionaire theme hour backs this up.

So we might as well have those hours sponsored by Toyota. So reach out, reach out. Next one, John, this one won't shock you. They pay off their mortgage. A lot of people think, well, wealthy people know that you can invest a difference and become very wealthy. So they hang on to their mortgages for 30 years and then refinance for another.

Nope, not what we found. They get rid of their mortgage on average 10.2 years, our millionaire study found. And so following the baby steps, we teach pay off your mortgage early. I don't care if the interest rate is 9% or 2%. Getting rid of that payment allows you to build more wealth. Which brings us to the last one.

What do wealthy people do? They invest for the future. Eight out of 10 millionaires studied, invested in their company's 401k, three out of four invested outside of the company plan. They know that investing over a long period of time instead of buying crap you don't need with money you don't have is the key to building wealth.

That's it. It sounds simple, but it's so nuanced because you would think that wealthy people just do what they want and they're not really intentional. And that when you're broke, you have to be more intentional. We found the opposite. Well, it's like a, it's, I think the great lie in this country is one day you get to

retire so you can quote unquote do nothing. And I think people consider wealth, I want to get enough money so I don't have to worry about it. And that's not how it works. And if I was to come up with a theme for the wealthy people, it is they don't make other people rich and they solve for peace. And so they, a wealthy person, you always want to ask like, I want to be a billionaire by 40.

And I always want to say, why? For what? So you can sleep at night. Okay. Give your body the opportunity to live in a home that nobody can take away from you. Then you're gonna sleep, right? Then you're gonna have peace. And so they pay off their mortgage, they invest, they know that come what may, I'm gonna be okay then,

no one can take my house now. It's this idea, it's they're thinking about tomorrow, not just this afternoon, not just this afternoon. But if you solve for peace, not for credit card points, or not for the difference between my 2.9 and my Saul for I'm telling you man there's a you get wealthy for a reason you don't get wealthy for the sake of wealthy and I think our culture has missed that completely we have no why behind it no wonder we just judge ourselves how much

are you worth it's a number and that the answer to that question is never a number we always are like okay what we what are we worth? What are you worth? What are you worth? Instead of saying, why? And dude, I don't care what my interest rate in my house is. I don't want anyone to be able to take my house away, so I'm gonna pay it off, right? And wealthy people solve for different problems.

That's a good lesson right there. And if you wanna see where you stack up, we have a free get started assessment you can check out. It's a quick quiz to see if you're on track. Go check out the quiz. It's in the show notes, the wherever you're listening and click on the title Are you on track with the baby steps good stuff John? This has been the Ramsey show I've been doing this show for over 30 years and some of the saddest calls

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

like it's just, it is, it's terrible. And so life insurance is the one thing, especially as a mom with three little kids that I'm like so big on for people to get because it's inexpensive. Xander is the place that Winston and I actually get all of our life insurance. And it doesn't cost much because Xander shops

among a gazillion different companies. It doesn't cost much. You just have to admit that someday you're not gonna be here. You gotta say it out loud and you gotta say, I'm gonna say I love you to my family by taking care of them and taking the time to put this stuff in place.

The cost of stinking pizza. To get a free quote, call 800-356-4282. That's 800-356-4282 or go to zander.com. Live from the Ramsey Network, this is The Ramsey Show where we help people build wealth, do work that they love, and create amazing relationships. I'm George Campbell, joined by bestselling author Dr. John Deloney, and we're taking your calls at 888-825-5225. You call us up and we'll give you the right next step for your life and your money.

Sharon's going to kick us off in Sacramento, California. What's going on, Sharon? Well, I just had a quick question regarding transferring balances to a HELOC loan and I'm sure that's a good idea because the interest rate on the HELOC is lower than the credit card. So I wanted to get some input. So what's the balance on the credit card? It's about $2,300. And what's the balance on the HELOC? About $13,000. Okay.

And what was the reason for both of these? What did you use it for? Well, the HELOC, two years ago, I had to replace my roof and I didn't want to refinance at a higher rate. So, I got the HELOC to replace my roof on my house. And then the credit card, the water pump in my car cost a little bit more than I anticipated and I had to repair that about six months ago. How long have you been living on the edge like this with no money for emergencies? Probably for a pretty long time.

I have $1,500 in my savings, but I didn't want to use it for the car. I didn't want to drain it to zero. It kind of scared me. It scares me to be in credit card debt at 25% interest trying to transfer to a 13% interest HELOC. Well, no, actually% interest HELOC. Well no, actually my HELOC is at 4.5 and my credit card is at 13%. Okay. So here's the hard truth is that the interest rates aren't the problem.

Okay. You can pay off $2,300 and the interest is going to be negligible. Okay. The harder thing we have to deal with is getting out of this cycle where we turn to debt and then try to move one debt to the other piece of debt to pay off the debt. I want you out of this cycle. Don't you wanna be out of this rat maze?

Oh, absolutely. I spent all last year paying off four other credit cards. So, I mean, I was doing the baby steps before I knew about the baby steps. So what if instead of transferring the balance and paying the balance transfer free to move it to the HELOC, to hope to pay off the HELOC, what if we just said, I'm done,

I'm gonna pay off the card and then cut up the card, and I'm not gonna go into credit card debt again. I'm gonna build an emergency fund and I'm gonna get out of this HELOC and I'm gonna start a maintenance sinking fund for all the things I know are coming up. I want you to get ahead of this so that life isn't just happening to you.

And it sounds like it's been that way for a long time. Are you doing this alone? Are you married? Single? No, I am divorced. I am doing this alone and- How old are you? I'm 60.

What does 65 Sharon wanna be doing? Well, 65 Sharon wants to hopefully retire and build a long-arm quilting business. Oh, that's fun. That sounds awesome. So you want to plan to retire? Yeah, I'm planning to retire and use the long-arm business to supplement my income because I know I won't have enough for 401k retirement, yada yada. So what are you making right now? About 65.

Awesome. And what's your total debt other than your mortgage? The HELOC, the credit card, everything. Okay, well my long arm machine, I still have 13 on it, and I have 13 on the HELOC, and 23 on the credit card. 2300 on the credit card, 1300 or 13,000? 13,000. On the first one.

And what was that? Yes, the long arm machine. And what does that do? I'm not privy to this world. Oh, and your quilting machine? So the long arm machine puts the pretty pattern on the quilt to sandwich it together. And it was, you owe 13,000 on that machine?

Roughly, yes. What are you making from this business right now? At the moment, nothing. Only because the timing on my machine isn't working correctly, so I can't quote other people's quotes and I don't wanna ruin their quote. Oh boy. So you have a $13,000 depreciating asset in your house. It's a paperweight.

It doesn't work? Well, it works. I just need someone to pay somebody to come out and fix the timing on my machine. Oh man. My honest thought is if you want to have this dream where you get to do this one day, you might have to sell this thing to get out of the debt.

Because my guess is you don't have a ton of margin left over every month. Have you done a budget where you list out, here's all my expenses, here's what I'm taking home, here's what I have left to pay down the debts? Yes. And how much is left? I don't necessarily, not much. So, don't use your- And what's the payment on this machine?

$260. So you'd have an extra $260 to throw at the debt, at least. Correct. That'll help you get out of this credit card debt, which will free up another payment. Do you see how this debt snowball would work? If you pay off the smallest debt first, which would be the credit cards, you'd free up a credit card payment. And if you sold the machine, you'd free up another 260. Now we can use that to attack the HELOC

and be out of this debt. My guess is making 65, getting on a real solid written budget, you could be out of this debt completely in under a year. So at 61, we're debt free. By 62, we have a fully funded emergency fund. And then we're maxing out all of the retirement accounts we can for a few years so that we can retire with dignity.

Okay. Then we're buying a quilting machine with cash. That's ours. And probably used on Facebook marketplace from someone named Sharon who said, hey, I can't fix it. If you can fix it, good luck to you. I'm selling it for five grand and you'll get a deal on it.

You'll buy the same exact machine back from your alter you at half the price. Oh. How does that sound? Okay. Not the question you called in for, but that's the answer I would give to my own sister or mom or friend.

Yeah, you're talking to two guys who have moms in your age vicinity. Okay. And I can, both of us are getting nervous right now. Why are you getting nervous? Thinking about our mom and your situation. Because I want my mom to retire with dignity. I don't want to see her struggling with bills as she enters retirement wondering how she's going to make ends meet with no ability to work a full-time job.

That scares me. And I also wanna acknowledge how heartbreaking it is. This is not how you drew it up, how you thought things were gonna be when you were 60, is it? No. No. And so I think instead of having dreams

that we're gonna put on a credit card here or move some money around here or get a credit card and put on a HELOC here, I think there comes a moment when you sit down and acknowledge. I did not this is not how I drew this up. I Had a ride or die and for whatever reason my marriage fell apart I don't know why I'm still here in Sacramento. I want you to have those conversations and get with a friend and grieve it and Then be intentional and the word I use here is not to mock anybody or point fingers but it's I have to choose reality here's reality I really want to do quilts and right now I can't afford to do that because math okay and I

really want to be free when I'm 65 and that means I'm gonna have to work really hard at 61 I don't want to be you don't deserve to be mom should be having their feet up at 61 and playing with grandkids and rolling. You know what I mean? And unfortunately that's just not your reality. So let's get there as quick as we can and let's go do the next hard, hard, hard things for 61 and 62 so that 65, 75, 85 year old you has a pretty sweet ride. Okay. You're going to have to reverse engineer this Sharon.

That's why I want you to envision that 65 year old Sharon and then say what must be true to get there. And that might mean selling this machine for now so that I can have it later with freedom instead of stress as I'm quilting. This is the Ramsey Show. Hey, I'm excited to talk about a new sponsor, Berna. You all probably know I'm a gun guy, but I'm big on safety, so I'm also a Berna guy. Berna is the un-gun, a less lethal option that protects you in more ways than one.

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buy or sell your home with confidence. You'll find calculators, start to finish guides, a podcast, and even an in-depth video course hosted by yours truly. What's not to love? So if you're ready to take the next steps toward your home goals,

go to ramsysolutions.com slash real estate. That's ramsysolutions.com slash real estate. Welcome back to the Ramsey Show. I'm George Campbell, joined by Dr. John Delaney. Hey, today's the last day of our extended Cyber Monday sale, and that means it's the last day you can get prices as low as eight bucks on meaningful gifts for everyone on your list. We've got bestselling hardcover books and assessments for just 12 bucks, total money

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What's going on Caleb? You with us? Hello, yes, sorry. My question was, I was wondering, I've got to, here in about a year, I'm gonna be coming into a about $37,000 personal injury settlement. I'm a new father and I just kinda wanna make sure

that I set up my family and make sure that I just, I do the right things with it instead of looking back on it a year, five years, and being like, damn, I really wasted an opportunity. Or darn, sorry, I apologize. That's wise. Are you okay now? How's your health? I'm all right.

Just a little shaky, I apologize. No, it's good, I'm just wondering, do you have ongoing health issues that you take care of? Do you need this money for anything related to the injury? No sir, I'm death free, I'm not at all into your guys' baby steps, it's something I need to definitely look into. I know my grandma is a big fan of your guys' show. And I just... Grandmas love us. What can we say?

Yes, sir. So you're debt free. So you kind of followed the plan already by accident. Yes, sir. You have no debt. Are you guys renting right now? Yes, sir. Okay.

And do you have an emergency fund of three to six months of expenses? No, sir. Okay. And do you have an emergency fund of three to six months of expenses? No, sir. Okay. Where are you at on savings? I don't have any savings. Well congratulations. You will a year from now. Here's my encouragement to you, get an emergency fund before you ever get the settlement.

Because you said you're going to get it a year from now? Roughly. It'll be February of 26. Okay. So even longer than a year. So you need an emergency fund now. So that would be your next goal, is to add up what it takes to run your household for a month. Let's say it's $5,000 and you want a four-month emergency fund. That's $20,000. So how much do you make as a household? dollars. So how much do you make as a household? I make roughly I think 40k a year, I honestly don't know. I was trying to figure that out

because they asked me. I answered 19 dollars an hour so I'm not very well versed. Okay so you get paid hourly and you work 40 hours a week? Yes sir. And 19 bucks. Yeah, that's about 40 grand. Okay, so your next goal is to go, how much can we squeeze out of this budget, aside from basic bills, to get that emergency fund in place so that then we can begin investing?

And once you get that settlement money, now it's, well, what can we do with this? Maybe a start of a down payment to buy a house one day. Right. Is that a goal for you guys? Well, this is something that happened when I was in middle school and that was always my thought was to buy a house,

to not squander it. But I'm not the financial guru, that's kind of why I called you guys. Well, you don't need to be a financial guru. You just got to stay out of debt, have money in the bank to cover emergencies, and then begin building for the future. And that would mean following the baby steps,

you'd be investing 15%. If your income into retirement accounts, you'd be putting money away for that down payment. And when the time is right, you can get that house. And you're 24, there's no rush to do any of this, but I wanna put you in a position so that you have options. Yes, sir. So I'm gonna send you my book, Breaking Free from Broke.

It's gonna walk you through this whole process so that when you do get this money, you'll know what to do with it. Cause I can tell you don't wanna squander it. And as a new dad, I'm a new dad too. It changes the way you look at things. You're not doing things for yourself anymore. If you look at our purchases on Amazon and Target,

it's mostly for the baby now. And so I love that you're looking at this from a legacy perspective and not just a, you know, selfish 22-year-old knucklehead perspective. Well, that's been the last 24 years now. I got the next set of years to not be selfish and take care of the kids, so. I love it. Hey, you're wiser than John and I got the next set of years to not be selfish and take care of the kids. I love it.

Hey, you're wiser than John and I were at your age. I'll tell you that much, man. I didn't even know what day it was when I was 24, man. So good on you, brother. It's awesome. Yeah. And I hope you heal up fully from that incident. So hang on and we're going to have our friend Taylor send you that book, Breaking Free from

Broke. Kate's up next in Alberta, Canada. What's going on, Kate? Hi there. Hi guys. Thanks so much for taking my call. Sure. you that book, Breaking Free from Broke. Kate's up next in Alberta, Canada. What's going on, Kate? Hi there. Hi guys. Thanks so much for taking my call. Sure. I love learning about how to best utilize our money and meet your guys' help with something because I've been wrestling it around in my head with many different scenarios. So my

husband and I want to build a modest lake home in our retirement, but I'm just cautious. I don't want to make a mistake or spend unwisely. So just a bit of background. My husband and I have had a few hard goes in life, but now after putting our noses to the grindstone on our own, we've established financial security, we think. We've been in collaboration with our financial advisor. And so our financial picture looks like this. It's a little bit different in Canada. We have RRSPs for retirement savings and

my husband has 750,000 in his. I have a hundred and fifty thousand in mine. thousand in his. I have a hundred and fifty thousand in mine. We have combined three hundred thousand dollars in our tax-free savings account. We have an extra a hundred and forty thousand dollars saved up in cash. Our primary house is worth four hundred and forty thousand000 and that is paid off. We have an additional rental house that's worth about $400,000 but we have a hundred fifty thousand worth of mortgage still on that. What I alluded to earlier, I know this was a poor decision but we were doing the best we could without any parental guidance or help, we

bought Universal Life and so we have $650 that will be a payout on our death. And so, thoughts moving forward, I just recently retired so as well as my $150 in my RSP, I have a defined pension benefit of $3,000 a month. My husband, I'm 54 and so I'm hoping because I've gone through some tough health issues that I could retire and my husband is 56 and he's looking at maybe working for a couple more years. And so our financial advisor really feels strongly that we are okay to be able to have some good D accumulation strategies in retirement

and we should have kind of a nice little legacy at the end. But yes. So what's the retirement home gonna cost? About 400,000. And will you be paying cash for that? Well, see, that's the thing. We don't want to, I have to figure out all the nuances about RSPs and tax-free savings, but we don't really want to tap into that.

So our thoughts are that if we kept both of our homes, like the one that we've paid off our primary home and we can use the rental income to help boost our income in retirement, we could remortgage our rental property. So that money- Okay, can I be honest with you? I don't like the idea of remortgaging anything as you head into retirement. That's adding risk and stress into your life. So here's what I would do because we're short on time.

I would pay off the rental. And if you have the money and it's not gonna decimate your nest egg, you can build that retirement home one day. Right now, it looks like you guys are gonna rent a wonderful home for a few weeks as a vacation home. But I would not sink 400 grand of your nest egg. That's a third to half of what you guys have right now. And I'm not super confident in this plan.

I want you to solve for peace. You have 5,000 moving puzzle pieces and it's exhausting just listening to you trying to balance this and move this over here and try this thing. Try solving for peace. How simple can we make this? How simple can we have the life that we want to live? Seek that option. This is The Ramsey Show.

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Download the EveryDollar app for free today. Go download it today. Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Delaney. The number to call is 888-825-5225. The Ramsey Show question of the day is brought to you by WyeRefi. We trust WyeRefi because they help people who have defaulted private student loans to refinance with a low fixed interest rate they couldn't get anywhere else. Chris had a student loan and he cut his payment by over 40% with Wirefy. So go to wirefy.com today slash Ramsey, that's the letter Y, R-E-F-Y dot com slash Ramsey. May not be available in all states.

Today's question comes from Jenna in Minnesota. Jenna writes, a few years ago, my husband loaned some money to a friend and also let the friend use his credit card. He thought the person was trustworthy, but by the time we realized what this guy had spent, he owed us about $15,000. He pays us back here and there, but it's only a couple

hundred bucks every few months. At this rate, I'm worried this guy doesn't actually intend to pay us back the full amount and is only paying us occasionally to keep us happy we recently found out he had taken advantage of at least two other people as well and still owes them also are there any legal measures we can take that won't cost us more than it's worth walk away Jenna this is what we call a stupid tax the $15,000 stupid tax. It's a heartbreaking tax. It's a, I thought you were a better friend tax,

but walk away. You are expending way more emotional and relational and psychological energy over this than he is. And so it's like that old AA adage, you're drinking poison every morning hoping that he gets sick and dies. It's not how it works. You're the one getting sick.

You and your husband wash your hands of this thing, block this guy on social media and go about your life and just know we're never going to loan friends money again. We will give our friends money. We'll give it to them all the time generously and recklessly, but I'm not going to loan any money because it puts a huge wedge between us and our relationship. That's it. So I don't think this is worth going to Judge Judy over to some civil court to try to get the money back. Cause my guess is he doesn't have it. He's not secretly hoarding hundreds of thousands of dollars. And you know, you learn the lesson here is you lost a friend over this

and it wasn't worth it. And he did this to other people. And the fact that he couldn't use his own credit card because he was doing that bad financially that you lent him your credit card, that's asking for fraud. And the problem is it's not fraud because you willingly gave this guy this money and loaned it to him. He didn't steal it from you.

So think about this in court. The judge is gonna say, let me see the contract. And you're gonna say, well, we don't have one. And say, what are the terms you all agreed on for when he'd pay it back? We don't have money. He just said when he could you'll agree on for when he'd pay it back? We don't have any. He just said when he could.

And did you just- Did he steal your credit card? No, I gave it to him. No, I handed it to him. I didn't think he was gonna spend 15 grand. Did you tell him, don't spend 15 grand? No. So it's one of those things that it defies

the implied social contract we all have with each other, which is to treat each other with dignity and respect. You guys got spit in the face, and I hate this for you. So you can just sit there with spit on your face, getting mad at him and mad at him, or you can clean up and go on about your life. And just know, like the Delonies, we don't loan money to our friends. I'll give money all day long. I might loan money because it creates a wedge in our relationship.

My friendships are too valuable to me. 100%. Thanks for the question. By the way, if somebody comes and says, hey, can I borrow some money? And you say, hey, we don't loan money to friends. Tell me what's going on. And they launch into, well, screw you. Who do you think you are? They aren't your friend. They are not your friend. They want to use you as a bank. You were just a pawn in their scheme. Yes, you were a means to an end. And it's a good litmus test of your relationship if your friends piss and moan about your boundaries. So sorry Jenna, but I would, you and your husband

would, as the great Jay Z says, brush your shoulders off and move on. I thought you were gonna go Elsa, let it go. Total frozen. Alright, fine. That's fine. You can tell my kids are older than yours. All right, Justin is up next in Oklahoma City. What is going on, Justin? Hello. Yes, I'm Justin. I'm currently 18 and I'm attending college

for a cybersecurity degree with a full ride. Cool. So I got a job offer for between $14,$20 an hour back in my hometown for full time. So, at the higher end that's about $52,000 a year with overtime included because it's 50 hour work weeks. It's at a, it would be a operation technician for a Bitcoin mining company. And while that can seem sketchy, they contacted me through my trade school and they have a good history with my trade school. So I'm

just wondering how much of a salary would it make it worth it for me to drop out of college? How far along are you in your program? So I attended a concurrent degree whenever I was in high school. So thankfully I'm three semesters and tonight program out of eight out of eight Man I might be on an island here, but If you were my son, I would tell you you have a Willy Wonka ticket Which is a free ride to a college education. I would take that ticket for a great degree for a great degree and to a college education, I would take that ticket. For a great degree. For a great degree. And the money you'll be making in cybersecurity, you're gonna be like, why did I leave all this

for a $14 an hour job for a Bitcoin company, which regardless of my thoughts on Bitcoin, is very volatile. And so this company could go under and they could say, hey man, we shut down operations yesterday. You don't have a job anymore. And so I would continue down this path. If Bitcoin really is what everyone says it is,

it's gonna be around a long time. And if you were qualified at 18, you're gonna be very qualified by 22. So I would keep pursuing this path of cybersecurity, knowing that you're gonna make six figures upon graduation, working for a reputable company with great benefits. And I would pass on this job right now. Yeah, and you're gonna have a certificate,

you're gonna have a credential that no one can ever take from you. The credential plus the training. And I think that's invaluable. And let me tell you this, can I applaud you? 18 years old and someone's coming out of the gate offering you 40 grand just to walk away from everything. You know what that tells me?

You're in rare air, my brother. That means you work hard, that means you're very smart, that means you get your stuff turned in on time, your grades are good, that means they've already they're already identifying you and what's hard when you're 18 is when somebody sees you and they and you feel seen and you feel known, it feels so good that it's easy to get derailed. And it's the 18 year olds with wisdom that say, okay, if I got this at 18, just imagine how many people are gonna be knocking on my door when I'm 20 and

I'm fully credentialed. And you're gonna have zero, none, no student debt because the school is paying for it, man. Full ride. It's a Willy Wonka ticket, brother. You won. So like I could tell you, I work with college students my whole life but more than that, I'm just telling you what I would tell my son which is ride this out, get the education, get their credential, this is a valuable degree and will only get more valuable over time. And these jobs at Bitcoin, I mean dude you're gonna have jobs lined up for you. So that's my recommendation.

All right, thanks for your time. Hey, congratulations man. It does my heart good to know, like you're building the infrastructure that my kids are gonna grow up in, man. And I'm glad to know there's young people out there like you out there busting it, working hard and making their grades, dude.

That's awesome. That's huge. And John, there's a lot of students out there, 17, 18 years old, and they're going, what the heck am I supposed to do with my life? I'm getting this degree because I was told it was the next right step I take out of high school. And so you've got to also weigh your options here and go,

if Justin was getting a useless degree that he wasn't excited about, and his parents just said, you have to go to college, do something, and he was just aiming at nothing and spending 50 grand a year in debt to do it, we'd, you have to go to college, do something. And he was just aiming at nothing and spending 50 grand a year in debt to do it. We'd probably say, hey dude, pause, go work,

go do the job making 40 grand a year, cashflow college later when you know what you wanna do. This was different where he's going. He's in a great field. Sounds like he knows what he's doing. It's excited about cybersecurity. Stay down the path and don't get distracted. Yes, and it's just that understanding that the jobs will come, the jobs will come, the

jobs will come. Yes, if you find yourself, your parents are saying, you're going to be a doctor, and you just finished your first semester in college and you hate it, you hate biochem and you hate biology and somebody comes along and says, I'll pay you 40 grand to come home, take that job, right? And that's a great situation to figure out what's next for you. But if you're on the path and someone tries to,

in that same field, get you off the path early, the disciplined thing is to stay on the path. And it checked a lot of boxes for me. It was a full ride with a great degree on the other side. And he's already three semesters in, young guy, already has, you know, clipped some credits here and there. So I feel like let's ride this out and see where it goes.

My guess is four years from now, he's not looking back with regret that he didn't take the $15 an hour job. He's going, oh my goodness, I'm doing what I love to do. I'm at a $120 an hour job. Yes, exactly. I would aim your sights higher when you're as smart as Justin is. So thanks for the call. This is The Ramsey Show.

It's Cyber Monday week and if you're looking for Christmas gifts that actually make a difference, we've got them. Get bestselling books like Breaking Free from Broke, Baby Step Millionaires and more for just $12 or audio books for just $8. Now's your chance to give something that'll help your friends and family build wealth, transform their relationships, and find work they love. Visit ramsysolutions.com slash store today. Ramsysolutions.com slash store.

Welcome back to The Ramsey Show. I'm George Campbell joined by Dr. John Delaney, open phones at 888-825-5225. Well, it's that time of year in a few weeks. I'm George Campbell joined by Dr. John Delaney open phones at triple 8 8 2 5 5 2 2 5 Well, it's that time of year in a few weeks We're gonna be doing a special giving edition of the Ramsey show Dave Ramsey And I will be hosting that one and we want to hear stories from you about how you have given generously this season Maybe you tipped a waitress a hundred bucks you bought Thanksgiving dinner for a family who couldn't afford one Maybe you bless someone in need by giving them a car

Or maybe you've been on the receiving end and had your life changed by someone who has given generously to you. Well, you wanna hear that story. Go to ramsysolutions.com slash ask, A-S-K, and put giving in the subject line. ramsysolutions.com slash ask, put giving in the subject line.

It's one of our favorite shows. It's coming up on December 18th. Start sending in your stories so we can celebrate living like no one else so that you can give like no one else. And if you didn't know, this hour of the show, when it ends, you're gonna miss out. If you're not over on the Ramsey Network app, where we're doing a whole nother hour,

the Ramsey Network app is the only place to get full episodes of the Ramsey Show. You can download it for free using the link in the show notes or by searching Ramsey Network in your app store. And if you're on radio, stay tuned, the show will continue. But if you're on YouTube or podcasts, anyone else, don't miss what's next.

Finish the show in the Ramsey Network app. They also just rolled over my show, the Dr. John Delaney show. I heard that. With video on the network app. So now it's the place to be. It's where the party's at. You can get my show a week in advance

before it launches out in the real world. Nice. Now you can tell all your friends like, wait, what? I get it, dude. I get it early in the app. I already got it. Where you been? Yeah. It's kind of the kind of the cool flex is to be on the app. Don't be late to the party. I don't even get invited to the party, let alone late. You'll get there one day. All right. Steve's in San Antonio up next. What's going on, Steve?

Yes. Thanks for taking my call. I'm talking about the identity theft. Let's talk about it. I'm having, I'm being bombarded with data breach letters and it's all from either the hospital or their vendors or ambulance service. And it's really, and for somebody like myself who doesn't really know that much about the high tech world, it's bothering me. It's messing with my head. And I just want to know if there's an easy way to get to, you know, take yourself out

of the system some kind of way. When you say bombarded, sometimes when I get nervous or frustrated or I'm in a world I don't understand, I'll say bombarded or I'm getting blown up. But actually it's like two or three. So how many letters, I mean how many times have you been the victim of a data breach? Five times, five times since 2017. Five times, okay.

And it's like a hospital or an ER or something like that? Yes, it's a hospital, the vendors for the hospital, you know, and more than one hospital. And then this ambulance service, that's the latest, and the only reason they took me on in 2017, that's a long time ago, I thought, you know. I mean, you know, I didn't... So these emails, texts, phone calls, how are they contacting you? Letters. Letters.

Letters in the mail. Yeah and sometimes those letters just say hey a big block of things got exposed it doesn't even mean anybody took anything. It means somebody hacked into a thing and they may have gotten 10 names but there was 10 million names in there and yours was one of the 10 million so it can be pretty confusing. I've got a couple of routes for you. Here's the thing, getting quote unquote out of the system at this point, and you're talking to a guy

that spent my whole life trying to avoid being on the internet. John is a privacy nerd. I am, it's a game for me. I don't even know that his real name is John, to be honest. It's for sure not, it's Daryl, right? But so I have tried to opt out. I've recently relented. There's not a way out. And so I think the things to do is to protect yourself. There you go. So two things that I do

and that George does too is one, I work with a company called Delete Me, and you can go to Delete Me, or join deleteme.com, J-O-I-N, deleteme.com. Slash Ramsey, we'll take you right there. Yeah, or slash Deloney, because then I get credit for it, but slash Ramsey. Oh wow, wow. But here's the deal, they go through and pull all of your, anything on the dark web where they're selling your,

like spammers and scammers and people trying to steal your data, they pull it all off the internet and they send you a report every month. It's pretty amazing what they do. The second thing is to get identity theft protection from our friends at Xander. I've got it, George has it, and it's really inexpensive.

In the rare case that you get your identity stolen. And even money stolen. Money's to take it out of your account. It's very rare if it happens. It happened to George once. Never happened to me. And even money stolen. Money's taken out of your account. It's very rare if it happens. It happened to George once. Never happened to me. If it does happen.

They've stolen funds recovered. They go chase it down for you. So in a world like, I'm like you, man. I don't know how any of this stuff works. I don't get it. If you told me to log into the dark web, I didn't even know what that is. I didn't even know what that is.

I didn't even know how Twitter works, right? But I trust these folks that if something does happen, they're gonna chase it down and help me out. So those are the two ways I protect me and my family right now. What's the name of that place again? We'll make sure to get you the links, hang on the line, but if you go to joindeleteme.com slash Ramsey,

you'll get 20% off their plans and they're real affordable. We're talking like nine bucks a month, Steve. And then same with Xander ID Theft, very affordable about the same price. And they do two different things, but they're both wise to have and it'll give you peace of mind. For that 20 bucks a month you're spending for all this,

you're gonna sleep better at night. And I'll tell you, anecdotally, Steve, I've got a lot, I have much fewer text messages and phone calls and spam since signing up for this. All right, well, I was thinking about that. Getting that turning my money into gold and bearing it. No, no, don't do that. The banks are not the issue, Steve.

So keep your money in a bank. It's much safer there if it's FDIC insured, which most banks are using are going to be same with your savings accounts. I would not put this money under a mattress or in gold. Don't bury it in the yard. Although... Up to $250,000 it's safe. Well, sure. That's one account.

Yes, you can also get some of these high-yield savings accounts that have rollover protection that they move your money around to multiple banks. They can be millions and millions. My high-yield savings account has millions of dollars in FDSE protection on it. So okay, so I guess, but if I let's just assume that I had some gold buried up here and I took a one ounce deal out and one ounce of gold and took it and got turning to money, how does a tax man get his cut? When you buy gold? Or when you convert it

to money what I'm turning go back in the currency I got what point in that transaction there when do I did I get it initially or what I don't know the tax ramifications of selling gold and turning it into dollars yeah from your yard I don't know, man. Yeah. My guess would be at some point, you'll have to report a commodity sale as income. You're just, you're just, it's like me going to London

and getting some pounds out of my dollars. You're just converting it. So I don't know. That's one to Google, Steve, if you can do that. But as far as your safety goes, gold is not gonna keep you any safer You're just converting it. So I don't know. That's one to Google, Steve, if you can do that. But as far as your safety goes, gold is not going to keep you any safer than having your money in the bank. Yeah, my guess is on money.

If you got money and then you bought gold with it and buried it in your yard, and then you took that gold out and converted it to cash, you would have probably already been taxed on that money when you got it the first time. Well, I'll tell you what, I think Germany before World War II, when they printed printing presses, they were printing money all over the place, just because they guaranteed so much of it, doesn't mean it's worth anything. That's right.

That's right, but I'll tell you this, a great friend of mine who is a bank executive said, the best we can do is the next right thing, and we can plan, but if we spend our time trying to avoid meteorites, like I don't have a meteorite plan, if suddenly the United States is not able to ensure its federal deposits and the banking

system collapses. The gold that I've buried in my backyard will be worthless because my neighbor is going to come over and try to fight me for my water. And so what happens a lot is these stupid commercials come on these news channels trying to sell you end-of-time hedges. And end And end of time hedges don't work. The greatest hedge you have against an end of time apocalypse is to be really closely connected to your friends and neighbors so that everybody can work together. Not to have-

No, I really wish that the government was more responsible and they didn't put us in this situation where we have to be so concerned about it. I know. But the next best thing is we're responsible. Yes! I wish that. And it just isn't the case. They spend money like it's going out of style. And Steve, I googled it. Check this out. There are reporting requirements for gold sales and you will likely have capital gains tax if you made money off of it. You want to get real nerdy? Form 89.49 and schedule D. There you go.

There's your nerdery for the day. You're looking to sell some gold. Well, not how I expected to end this hour, John, but we did it. I love my job. This is The Ramsey Show. Hey, you're still here? What are you doing? You do know that the rest of today's show is playing right now over on the Ramsey Network app, right? All you got to do to finish the episode is search Ramsey Network in the App Store, Google

Play Store, or just click the link in the show notes to download the app for free. Yep, you heard me right, for free. Then right there on the home screen, you can watch the rest of today's show. Ba-da-bing, ba-da-boom. All right, I'm getting out of here. Enjoy, we'll see you on the app.