The Ramsey Show - Don't Settle for Living Paycheck to Paycheck

Episode Date: July 24, 2025

📈⁠⁠⁠⁠ ⁠Are you on track with the Baby Steps? Get a Free Personalized Plan⁠⁠⁠⁠⁠ Dave Ramsey and Jade Warshaw answer your questions and discuss: "How do I navigate $1.8M in debt with no income?" "My employment is directly tied to my FICO score. How can I pay off debt and keep a good score?" "I'm 51 with no retirement savings and I am currently carrying my daughter's student loans I cosigned on..." "Is it too late for a 47-year-old man to find financial peace?" "My husband's gambling has us late on our bills. Do I have to go back to work, or can I still be a stay-at-home mom?" "Our advisor is telling us to take out a HELOC on our vacation home to invest and supplement our income" "How can I convince my wife that we don't need to invest while paying off debt?" "How do we navigate family dynamics without seeming like the cheap family?" "How do we wisely manage a $100K gift from my parents?" "I was recently diagnosed with a rare cancer, how do I get my finances in order?" "I'm $400,000 in debt, at what point should I declare bankruptcy?" "We're debt-free, can we afford to buy a business?" "What's the best way to invest our 15 year old son's earnings?" Next Steps: ✔️⁠⁠⁠⁠ ⁠Help us make the show better. Please take this short survey.⁠⁠⁠⁠⁠ 📞 Have a question for the show? Call 888-825-5225 weekdays from 2–5 p.m. ET or⁠⁠⁠⁠ ⁠send us an email.⁠⁠⁠⁠⁠ 📱 Get episodes early in the free Ramsey Network app!  💵⁠⁠⁠⁠ ⁠Start your free budget today. Download the EveryDollar app!⁠⁠⁠⁠ 💗 Two Weekends. One Life-Changing Experience. Get away with your spouse in Nashville. 📈 Free Tools & Resources to Help You With Investing Connect with our Sponsors: Stop paying more and start shopping smarter at ⁠⁠⁠⁠ALDI⁠⁠⁠⁠ Get 10% off your first month of⁠⁠⁠⁠ BetterHelp⁠⁠⁠⁠ Go to ⁠⁠⁠⁠Boost Mobile⁠⁠⁠⁠ to switch today! Learn more about⁠⁠⁠⁠ Christian Healthcare Ministries⁠⁠⁠⁠ Get started today with⁠⁠⁠⁠ Churchill Mortgage⁠⁠⁠⁠ Get 20% off when you join ⁠⁠⁠⁠DeleteMe⁠⁠⁠⁠ Go to⁠⁠⁠⁠ FAIRWINDS Credit Union⁠⁠⁠⁠ for an exclusive account bundle! Find top Health Insurance Plans at ⁠⁠⁠⁠Health Trust Financial⁠⁠⁠⁠ Use code RAMSEY to save 20% at ⁠⁠⁠⁠Mama Bear Legal Forms⁠⁠⁠⁠ Visit⁠⁠⁠⁠ NetSuite⁠⁠⁠⁠ today to learn more For more information, go to ⁠⁠⁠⁠SimpliSafe⁠⁠⁠⁠ Use promo code RAMSEY for 18% off at ⁠⁠⁠⁠The Nokbox⁠⁠⁠⁠ Get started with ⁠⁠⁠⁠YRefy⁠⁠⁠⁠ or call 844-2-RAMSEY Visit⁠⁠⁠⁠ Zander Insurance⁠⁠⁠⁠ for your free instant quote today!  Explore more from Ramsey Network: 💸 ⁠⁠⁠⁠The Ramsey Show Highlights⁠⁠⁠⁠ 🧠 ⁠⁠⁠⁠The Dr. John Delony Show⁠⁠⁠⁠ 🍸 ⁠⁠⁠⁠Smart Money Happy Hour⁠⁠⁠⁠ 💡 ⁠⁠⁠⁠The Rachel Cruze Show⁠⁠⁠⁠ 💰 ⁠⁠⁠⁠George Kamel⁠⁠⁠⁠ 🪑 ⁠⁠⁠⁠Front Row Seat with Ken Coleman⁠⁠⁠⁠ 📈 ⁠⁠⁠⁠EntreLeadership⁠⁠⁠⁠ Ramsey Solutions is a paid, non-client promoter of SmartVestor Pros. ⁠⁠⁠⁠Ramsey Solutions Privacy Policy⁠⁠⁠⁠ Learn more about your ad choices. Visit megaphone.fm/adchoices

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show where we help people build wealth, do work that they love and create actual amazing relationships. I'm Dave Ramsey, your host. Jade Washaugh, number one bestselling author, Ramsey personality is my co-host today. The phone number is 888-825-5225. Tom is in New Jersey. Hey Tom, how are you? Hey Dave, how are you? Better than I deserve? What's up? I? Can't believe this Huge fan unfortunately, I found your stuff a little too late and I have quite the financial mess

Okay, tell me about it so I have four mortgages a car loan and one credit card and I started listening to your stuff. I was working. I was me and my wife, we were building an emergency fund and I had been trying to get rid of these rental properties for some time now. And I've made some leaps and shrines in the last few months. And my question is pertaining to the remainder of our money,

our savings are my wife is still currently working and she brings in 130,000. I am not working. I have been laid off for seven months. I have been looking tirelessly for work. I had unemployment and that had ran out. I recently have just signed up with Uber and I've been doing doing that but compared to my previous income it to great what did you use one thirty uh... used to make one thirty doing what

credit risk commercial real estate and why were you laid off two billion dollars in defaults billion dollars of that assets were sold off to another asset management firm and the position was eliminated. And given the current interest rate environment, a lot of people are skittish to hire specifically

for commercial real estate credit risk underwriting. Wouldn't disagree with that. But the skills that you use to do that are still usable in other things. So that nuanced job position is probably gone for a while. I would agree with you on that. But you mean you've learned to do financial analysis and risk analysis and that can be applied to a myriad of different things so you need to broaden your search. I'm closing in on one and I'm very optimistic and it is a pay bump but I'm not you know counting on it you know it's not in my hands yet.

All right so we got we're working on your income and so what the how can we best help you today? Tell us about the four mortgages. So I have my primary 540 at 5.75 payments, 4,400. I have a rental property with 453 at 6.5%. Payment P&I is 2956, not including insurance, not including taxes. I have another one at 192, P&I is 1,019. And then I have another one with a business partner which is at eleven and a half percent and that is 184 which yesterday

I am hoping that we are closing someone's purchasing at cash okay what will you take from that 45,000 okay but you're out. Correct. Heck with the cheese, let me out of the trap. Okay? I'm in. And so the other two are up for sale. So the other two are up for sale. The one that's up for sale, I've dropped the price from $340,000 to $295,000. My one question is, do I continue dropping the price until I get an offer? Is that property number three? No. You just said, I said there's two left and you said the one that's up for sale.

Why are they not both up for sale? Everything is up for sale. Okay, except your home? Except my primary which we're considering also putting up for sale. Is your car up for sale? The car is going up for sale. Good. Okay, good. So we're cleaning this out. All right. I don't know, I mean You've got to assess the real estate market there as to what's going on Okay, is the market simply slow or are you overpriced? There was a significant appreciation to one of the properties which is the one I had the specific question about to use the remainder of our savings to get

Out of that property. The question I want to do, the question I want to know is what is the stinking thing really worth? What is the actual market value? What is someone going to walk up and pay for this house today? Not what have you got in it? Not what do you wish would happen? But if you were going to put this thing on the market and you were not standing in the forest, instead you were outside looking at the trees, what is it actually freaking

worth? $475,000. All right. And what have you got on the market for? I have it listed for $495,000. Okay. All right. Well, if it's actually worth $475,000, that may be a bump high, but it's not

enough high to keep somebody from coming in and giving you a market value offer. So, how long has it been on the market for $475? The problem is, so this is kind of a unique situation. Someone has offered to purchase it and give me $20,000. I'm two months behind on that payment and I owe the property taxes. The conditions for them to come through with that are to be current with that mortgage and to be up to date on those property taxes.

And the 20,000 doesn't cover it. I'm sorry, they're gonna take over your mortgage? Sorry, can you repeat that? You threw your phone out the window. I'm sorry, what happened? They can't take over your mortgage, honey. They service it. No, they can't do that.

How does a real estate guy not know this? That mortgage that you have has a due on sale clause. You transfer a title, they're gonna call the loan. I'm not gonna be off the title. I know, but if you transfer a title in form, even though you didn't move, so you haven't really sold the house, you just lease purchased it to someone. No thank you. No thank you, I'll pass. Don't do that. That's a bad deal. A, if any of the insurance or anything else, any of the tax notifications, anything gets transferred out of your name and the mortgage company notices that they're

going to say you have transferred in form even though you haven't moved the title and they're still going to call the loan. Read paragraph 17 of your Fannie Mae deed of trust. You'll see what I'm talking about. How much are you, how much is the total of the months that you are behind in the property taxes? Cause you were talking about dipping into your emergency fund to clear that? I'm behind $6,000. They put a lender, a lender forced insurance policy on it, which is more than the other insurance would be. So, um So for the two months I owe a thousand in insurance for stay billed to a Forest escrow account and then 29.56 for June

and July's payment. You have two issues. Number one you've got to work on that issue. Number two we've got to get a buyer. The buyer that you have is not a real buyer. Run him off. You're gonna get in trouble here man because you're getting desperate. Yeah what's in your emergency fund real quick? $12,500. Yeah. Okay. So, and so the lesson Tom is this, okay? The things that you were taught in academia and I was taught in academia about risk analysis on real estate does not include the risk that debt represents and you are now experiencing the risk that debt represents.

Wholesale. I mean right across your face. You're getting slapped repeatedly with the risk that debt represents. So you went into all these properties thinking there was no risk and the tenants were gonna pay everything and the tenants were always gonna be there and they were always gonna pay and they weren't gonna tear up anything. There wasn't gonna be any repairs and you found out that the more debt there is the more risk there is and you just took on a boatload of risk for no money. One property sells you make 45,000 the other one sells you get out barely. You got no money and you traded all of that for risk.

So now I hope you can get out of these and that's your goal. I hope you get this job and that's your goal. Thanks for calling. These days, business as usual is anything but. Tariffs make trade policy a moving target, supply chains are squeezed, and cash flow is probably tighter than ever. So if your business can't adapt in real time, you're in a world of hurt. That's why you need NetSuite by Oracle, trusted by more than 42,000 businesses, including Ramsey Solutions. You need to see what's happening, what's stuck, and what's costing you, and how to fix it.

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And right now, if you're leading a business doing more than a million dollars in annual revenue, download NetSuite's free ebook, Navigating Global Trade, Three Insights for Leaders, at netsuite.com slash Ramsey. That's netsuite. Hi, Ryn. Welcome to the Ramsey Show. Hi. Hi. How can I help? So I got a bit of a problem that I'm trying to figure out how to navigate. So I work in IT for a lot of different financial institutions and do

a lot of security work for them and everything. And one of the things that's directly tied to my employment is unfortunately my lovely credit score. No it's not. Not in IT. It is if you're a president of a bank but not an IT. They're not going to kill you for not having a credit score. That'll hurt you for having bad credit. Right. But not no credit. Right and that's the problem I'm running into is that I've got credit. I've had credit for, you know, I've had good credit for quite a while, but I recently with a lot of the contracts I've been doing with all the work I've been doing I've actually been able to get a lot of

stuff paid down and unfortunate thing is one of my oldest accounts that had was actually an auto loan and I paid it off for here recently and So I'm like cool got the car paid off all great and I go and check my credit score and it dropped it off here recently. And so I'm like, cool, got the car paid off, all great. And I go and check my credit score and it dropped it below 700. And I'm like, what the heck? Well, that's normal. And, right, but the problem is with the contract

of my employment, it's actually, because they put it in the form of, hey, if you can't manage your finances, then why do we give you access to other people's finances to manage the servers that handle it? How often do they check it? Every six months. Okay, and how much debt do you have left to pay off?

Including mortgage and everything. No, not including your mortgage, just your consumer debt, just curious. Oh, consumer debt? I've got about 22. Okay, if you become debt free and your credit score drops below 700 and stays there, and they look at you and say, you're debt free so you can't manage money well, these are people too stupid to work for. Seriously. I agree with that. Yeah. So I mean, they have to have, you have

to look at whoever's using this and saying, listen, if you guys are so corporate and stupid that the only measure of financial wellness that you have is a FICO score and I'm sitting here debt free with a strong net worth and no payments and you're calling me not responsible You're stupid That's just dumb Yeah, and that's what I've been trying to figure out is like how do I tell them? Yeah, just what I get on the phone with the goober sign on the and go, dude, if I am financially irresponsible, yes, fire me. But I have no debt. That is not financially irresponsible and that drives your

credit score down. Right. And if you can't look at me and say debt-free is financially responsible, then you're too dumb to hire me. Honestly. See, you've made the assumption that there's only one way to look at this by them, and I'm saying when you get up in their grill, they're going to cave like a Walmart tent. Yeah. Yeah, they are. And the one that doesn't, so what?

Move on. I'm not going to pay interest to a bank and pay payments that I don't need to be paying to create an artificial wellness score that is not really a measure of wellness, but instead is a measure of how much I pay payments in order for some bureaucrat in corporate America who can't pull his head out of his butt to make a decision. No! Don't live your life that way, man. The only unfortunate thing is I actually really do like the work that I do. I'm not saying you're gonna... you're so

freaking scared! Yeah, you're making a set of assumptions. You're making assumptions. It's just you're not gonna lose these accounts, man. When you go in and verbally accost them, the way I'm describing, and say, I am financially responsible, I'm out of debt, the reason my credit score went down is not because I didn't pay my bills, you doopers, it's because I don't have any debt. And you may not even have to accost them. You might just explain it to them. The same way that you figured it out as a smart human being is probably the same way

that they're going to figure it out if you just explain it to them. Don't live with a glass half empty, man. Go in there and sit down and talk to them. And you're the same guy that calls up and goes, you can't rent an apartment without a FICO score. But when you call 40 apartments, 38 of them will tell you they will rent it once you're in an apartment without a FICO score So that's mythology that someone dreamed up and made everybody believe So they keep borrowing money and staying in debt to the bank your other option rent is just keep paying payments the rest of your

Life because you're too scared to talk to your employer about what real financial wellness is or your condo name your employers Yeah, you're gonna come contracts That's a good point If you run it out the other way as detailed as you've run it out the way it not working for you or your, they're not even your employers. Yeah, that's a good point. They're dad gum contracts. That's a good point. If you run it out the other way, as detailed as you've run it out the way at not working for you, that means that you don't pay off the car, you never pay off your house, you never- So you get to pay a bunch of interest for no reason.

You know, $100,000 over the next 10 years to keep your FICO score working well. That's just dumb butt. No. No. And guys, this is the problem with the FICO score. If you don't know, okay, it was developed by an organization called Fair Isaac. You can look it up on their website. 100% of the elements in the algorithm that create a FICO score are about your relationship with debt. Have you taken out too much debt? Have you taken out weird debt? Have you not paid your debt on time? Have you paid off debt?

The different types of debt. Different kinds of debt that you have. Is it a credit card debt problem? Is it a car debt issue? And so the only way you get a 700 to 800 credit score is you have paid hundreds of thousands of dollars over the scope of your life in interest to a bank. It's the only way the math works and the algorithm for you to have a FICO score. I can write you a check for $10 million, I'm not going to,

but if I wrote you a check for $10 million and you put it in your bank account, your FICO score doesn't change one point. If your boss walks in and says I'm going to give you a 10 million dollar a year raise, your FICO score does not change one point. You get completely out of debt and build a million dollars in your 401k, it does not change your FICO score one point except it will go down because you got out of debt. The FICO score is not a measure of financial responsibility.

It is not, except as it relates to debt, it is not a measure of financial wellness. It is not a way for you to keep score that you're doing well with your money. It's a way banks judge if you want to you're doing well with your money. It's a way banks judge if you want to play kissy face with them or not. That's all it means it. They see 800, they go, sucker score! 800 sucker score. That's what they see. They see you've been buying a lot of stuff on credit. You like to pay interest. Come over and give us some of your money. Sucker! That's what your FICO score means.

It's a sucker score. That's it, man. This is just nuts, y'all. It is not a measure of net worth. You go build a million dollar net worth, it does not affect your FICO score. You know what my FICO score is? Zero. I don't have one. It's indeterminable, which means I'm really off the grid. I must be financially irresponsible. I've got $600 million in paid for real estate, but I must be financially irresponsible. What a moronic thing. This bank wouldn't hire me that he's talking about to work on their software because I'm financially irresponsible by their measure.

Because the sucker score is too low. It's indeterminable. And you and Sam have the same problem. You're sitting here, just a couple of us, a couple of losers sitting here answering questions. A couple of broke, irresponsible losers. This just pisses me off so bad because people walk around and I run into people at parties and they're just, they kind of know a little bit that we, Ramsey does stuff with money and whatever. They don't know what, and they come over and go, you know, I got an 800 FICO score.

And I'm supposed to be nice when they do. Or apparently impressed. Yeah, yeah. And I just go, yeah, I think it's perfect for you. You know, I just keep walking around and it's, oh my God, you sucker! You just got screwed a lot and often. So please guys, don't worship at the altar of the great FICO. We bring you offerings of interest, great FICO, and you can give us anything we want

on payments. It's a sucker play, man. It's how the banks have made their whole dad gum life. Oh, it's a wonderful program if you're a banker. If you're a person, it's horrible. Please don't worship at the altar of the great fat FICO. Hey you guys, health insurance costs are only moving one way, and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer, and it's

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personalities. Jade, you've done a couple of these, haven't you? I did one today. Oh, wow. And I did did one today. Oh, wow. And I did one on Monday. Oh, wow, there you go. So we're gonna show you how to stick to a budget, even find $9,000 a margin using every dollar

so you can get out of debt, build wealth, and there's a Q&A time that's live so you can ask questions that are probably a lot safer than you can on this show. Ramseysolutions.com slash webinar. I bet the Q&A was good. Well, yeah, it was. And let me just say, because I have to say this,

we've done a lot of webinars in the past, and these are totally different. We're showing you completely new things. So if you thought you've seen an Every Dollar webinar, you need to log on to these, because they're completely different. We're unveiling some things Dave is all I'm saying Yeah, the the well we've iterated on the app and it is doing things that it's never done

Unbelievable. I saw some of the presentations yesterday some of the things that they're doing. It's very very They're walking you through the baby steps and showing you exactly in detail what the next thing is It's like if you had me or Dave in your pocket. It's to that level. So anyway. Yeah, very cool. RamseySolutions.com slash webinar. Get signed up. It's completely free.

Trisha is in Rogers, Arkansas. Hi, Trisha. How are you? Good. How are you? Better than I deserve. What's up? All right.

So in 2022, October of 2022, my husband of 22 years decided he was then being married and he left and he, um, divorced me, um, in the process of all that. So he, his income was around one 30 at the time. Mine was around 45. So I was very scared. Um, he had just bought me a brand new car in September. So when he left in October, I took the car back to Nissan where it came from. And I said, I'm going to this payments five 96, the math isn't mapping.

I'm going to have to have a cheaper payment somehow. Well, so they refinanced it. Basically I sold it to them and they sold it back to me used or something like that. It lowered the payment by about 50 bucks. And I was just trying to figure out how to cut expenses everywhere. Um, sold a house and, um, so I had to pay. So this took up my whole, I'm a teacher at a private school. This took up that whole school year for me.

At the end of it all, I, at the show of the house, I had to get that around 28,000. I had a substantially more, I think I had around 120 out of it, but I needed to pay. I had 60,000 in master's degree student loans that I had to pay for. I had 60,000 in master's degree student loans that I had to pay for. And I had about six or 8,000, I think from my undergraduate degree, which had included a 16,000 parent plus loan on it. So I paid those things off.

Um, in the process of the expenses discovery and everything, I had forgotten that I was a co-signer on the youngest daughter's student loans because she was a senior in college at the time. So it was kind of out of sight, out of mind while she has since graduated and she's paying on her student loans on the co-signer. Um, so I can't like do anything. I've got 38,000 in a money market savings. I've got 3000 in just an emergency fund. My, um, we've had a lot of changes in education in Arkansas from my salary

starting this coming school year will be 52, four, and I have also taken on a second source of income that generates roughly for the 2023 year I had it brought in around 12,000 which minus the 30% taxes out of that whatever that would be and I'm on track to make about 14,000 with it this year, but I'm Not a 30% tax bracket, but go ahead You're not on a 30% tax bracket, but go ahead. Oh, well, that's what, when I paid taxes, that's what the IRS charged me.

They literally took 30% of that income. Yeah, well, you need to file your taxes properly. You'll get some of that back. Something's not right there. How can we help today? So, I need to know what to do. So, I spent my whole life raising kids, homeschooling them. I have basically no retirement.

I kind of started my own since all this happened. And I found out this coming school year, my school is going to start a retirement for us. It's not a 401k. It's, I can't remember the letters and then we're going to have something. Does it do an automatic, is it automatic or do you get a say in it? I get a say in it? I get a say in it. They match 3% so we can opt in or not.

Let's just stop. The bottom line is that you've had your heart broken and you've been drugged around behind a car for the last two years. So you're just wrong. Right. Other than that, your math is okay. Your math is going to be okay. You're going to get there. Okay. Other than that, your math is okay. Your math is going to be okay. You're going to get there.

Okay? You're very analytical, and that's how I know you're going to get there. You know all your numbers. We don't have to ask you what they are. You're just spitting them out, just left and right. Even the ones in the past that don't matter anymore. So here's what we're going to do. We're going to walk you right up what we call the baby steps.

Lots of 51-year-olds making $50,000 a year, $75,000 a year with your extra income coming in have become millionaires by the time they were 65 or 70. Lots of them. As a matter of fact, the number three most likely career in our millionaire study we studied 10,000 millionaires number one was engineer number two was accountant number three was teacher and the reason is is that you're very process driven and I'm gonna give you the process it's called the baby steps

baby step one is a thousand dollars in the bank you've done that. Two Two is be debt free everything but your house. Now how much debt do you have that's not a house? Well I don't have a house anymore. We live in an apartment. I have one of my daughters and I live in an apartment. I have a car. Okay how much is the debt on the car? It's 25,000. The car is, I owe 25,000. It's worth 21,000. Okay., it's worth 21. And it's a lot of car. That's that stupid car that was bought right before the divorce, right? Right, yes. And you refinanced it, so you got screwed twice on it.

And you've got how much in a money market account? $38,000 right now. And how much debt do you have other than the car and and the living in the apartment? None. Okay this is gonna be very scary for you because you've built up walls trying to survive the last two years but if I woke up in your shoes I would write a check today and pay off the car. Now I'm debt-free and I have 13,000 left in my money market and how much was in the other account? 6,000? 3,000. Okay so now I've got

16,000 dollars that I can earmark and to a money market account as an emergency fund which is adequate for you to have as an emergency fund then that's baby step three then baby step four is start putting 15% of your income away if she puts 15% of 75,000 away from age 52 To age 65. What does she have 65? I have 70 in here. Oh, yeah 70 Uh-huh, okay, 480,000, but I did that at your current income. You didn't do that with the extra income. I did that 64. That's 64,000. Okay. So you'd have a half a million dollars if you invest 15% of your income and that's with no match, but you told us you get a match.

Right. Okay. Good. 3%. Yeah. So you're going to get that on top of that. So you're going to have six or $800,000 if you invest fifteen percent of sixty four thousand dollars and you never get a raise from age 52 to age 70. Okay? So you're okay. You're gonna be fine. But you're gonna have to continue to be very process driven, math driven, and let the facts talk to you. And the facts have done a good job talking to you in the midst of all your pain and trauma. You've remained fairly clear-headed. Congratulations. It's very difficult what you've been through because you've been through hell. Thank you. And then another thing I'm going to do is I'm going to put a kiddo

that has the student loan on a tight budget, make sure she gets a freaking job and she pays the bill. She's got to be responsible. She can't throw this back on you. Right, no, she's been doing great. I know, she gets to keep doing great. And we're gonna put her on our beans and rice, rice and beans, no run around Italy, get the freaking student loan paid off, kiddo. And then you can go have your life. But mom's on this thing, and mom can't handle any more people dumping on her.

Had enough dump on you lately. So you can fight through this, you can do it. Hang on, we're gonna put you in the Every Dollar app, the advanced version, as our gift, free, to help you work your way through this. You can do this. Switching banks can be a hassle and I totally get that. But when Winson and I opened up our Fair Wins account, we were shocked by how quick and easy it was. It just took a few minutes online.

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specifically for Ramsey fans. Plus they have a great app and you have access to over 33,000 fee-free ATMs and more than 5,000 shared credit union branches across the country. So you can have access and withdraw your money just like you're used to, no matter where you live. Don't settle for a bank that slows down your progress. Make sure you choose one that helps build you up and helps you win with money. Visit fairwinds.org.

and open your smart bundle today. Fairwinds.org. and open your smart bundle today. fairwinds.org.org. Fairwinds is federally insured by the NCUA. Are you staying on track with your baby steps? You can take a quick quiz to check your progress and receive a personal baby step. You can also check your baby steps. You can also check your baby steps.

You can also check your baby steps. You can also with your baby steps? You can take a quick quiz to check your progress and receive a personalized plan just for you. That's kind of all personalized means, right? Simply head over to show notes, click the link titled, Are you on track with the baby steps? Do the quick quiz and we'll help you with a personalized plan. Kiko is in Tacoma, Washington. Hi Kiko, how are you? Hi Dave, good, how are you doing? Better than I deserve, what's up? Yeah, so I'm a 47 year old single dad, twice divorced. Both my marriages I let my ex-wives

handle my finances so I never really learned how to manage money myself or develop the necessary discipline and I'm just really embarrassed that I haven't given my kids the best example how to respect and manage money. Now I'm at a point in my life where I'm trying to rebuild but I'm living check-to-check in debt and also an army vet so I struggle with not only childhood trauma, but ADHD, PTSD, anxiety, depression, which make it all hard to stay focused and consistent. But I have been taking some steps, like seeking mental health counseling, going through financial

peace university years ago through my former church. And I recently met with a debt management counselor, but I'm still feeling stuck and unsure what my next move should be to finally get control and give my kids a stable future. Are you disabled or are you able to work with your conditions? I'm at 90%, so I'm able to work. I'm an academic advisor and part-time college professor, but education doesn't really pay you.

So with all of these different income sources, including your ex-military, thank you for your service. What is your household income? I take home about $4,000 a month in salary and $2,400 in VA disability. Okay, so you've got $6, bucks a month to work with. Good. Nice. So where's the dream? Is it debt?

Just keeping up with child support, rent. I'm doing everything all by myself. You're just disorganized. Yeah. You have no idea what's going on. You just spend money till it's gone and then you worry. Yeah, a lot of it is I admittedly coping, trying to get through the season of fear. Yeah, absolutely.

And that would be normal. I don't blame you for that. But the good news is you can identify that so that we can whip it. Right. Because what you need to be is cold calculated and on the other side of this where this money thing is you're telling this money what to do instead of wondering where it went, right? You want to get control rather than be controlled. Absolutely. Yeah, I believe you. I don't blame you, man. I think I can smell that a mile away. I've been there.

That's how I know it kind of knots up in your stomach and moves towards your throat. Definitely. It ain't no fun, man. So, um, what we're gonna do is I want you to flip a switch because you've got this ability It ain't no fun, man. So what we're going to do is I want you to flip a switch because you've got this ability with your background, especially in the academic side. You don't need your debt counselor person is going to put you in more debt or they're going to put you in some kind of a debt consolidation loan.

That's not what you need. You need a system where Kiko takes control. And we're gonna flip a switch and pretend like I hired you for a hundred thousand dollars a year to manage this very simple set of finances. 6400 is coming in and every one of those 6400 dollars needs a name before it leaves. Before the month gets here, before the money actually comes in, it needs to already be spent in the EveryDollar app, already be allocated. And so when you start telling your money what to do before the month begins, that forces organization and it removes anxiety and

stress like you will not believe. You're gonna be amazed. Even though you're still in debt and even though you're still fighting some stuff, once you get on the other side of this and you're cracking the whip on it instead of it cracking the whip on you, you're suddenly gonna get a sense of peace. Now you got some hard work to do.

You got some calluses to earn, but you can do this. And Jade, you've been showing people how to do this in these webinars. It works. Yeah, matter of fact, I'm gonna give Keiko some homework. This is your homework tonight. We're gonna set you up with 14 days free. We're gonna give you the first 14 days on us,

but then after that, you gotta pay for it so you have some skin in the game. But tonight, I want you to download it, and I want you to set up your first budget. That's you, Keiko, putting the 6,400 that you make every month right at the top, and then you're just gonna go down and think of everything that you possibly spend money on

in the month, including your debt, write it all out. And then after that, I want you to go into the other part where it's gonna give you your personalized plan. So you can start to walk through and say, okay, what do I do first? What do I do with the margin that I found? Margin is just extra. What do I do with that extra money?

Which debt do I put it on? How long is it? It's gonna tell you all that. It's gonna tell you what debt to put it on, how long it's gonna take you to get out of debt, and then you're gonna walk away with what's called hope. Yeah, it's the Every Dollar app. It started out as a budgeting app,

now it's become a financial management app because we've kept iterating it and to where it starts to tell you what to do step by step while you're laying out your plan. And our team is here to help you. We're gonna walk with you through this and we're not charging you anything, okay? This is all just to help you out.

You can do this. You'll be amazed once you lay out and say, okay, here's the seven baby steps. I need to first save $1,000 and I need to work off my debts smallest to largest, pay minimum payments on everything with the little one, attack the little one, and the way I'm gonna find that money is I'm gonna write it all down

before the month begins in this app, I'm gonna tell the money what to do, and then the app's gonna give you suggestions on where you find more margin. Exactly, and that's the thing, like if you call into the show, based on what you're telling us, we can maybe come up with a couple of things to tell you,

but the app is gonna to go through everything. On average when people just fill out the stuff to start, they find about $9,560. That's right. That's been our average in the last 120 days using this new process. In just a couple minutes. Pretty incredible. Yeah, it's blowing my mind. That's the average, which means you might have $6,000 or you might have $16,000.

I don't know. But you can get a head start on this thing and get it turned around and get moving in the right direction. And it's kinda like what we do here, but it's actually more sophisticated because we forget to ask stuff here. That's what I'm saying.

And it'll go step by step and remind you, hey, this is what you do first, this is what you do next. And by the way, if there's something you don't understand, it'll teach it to you so that you do understand. Yeah, it'll pop up and throw a video of Jade up there explaining it, or George Campbell, or Dave Ramsey up there explaining it for you. So the thing is thinking, yeah,

it'll show you what to do exactly. And you don't need a debt management person. We'll be it for you, and it doesn't cost you a thing. There you go. So you hang on, man. We'll pick up and get you set up on that. Katie is with us in Seattle. Hi, Katie, how are you?

I'm all right, how are you? Better than I deserve, what's up? Well, so, it's kind of a complicated question, but basically, I've been trying to manage our finances as a household. I'm a wife with a 14-year marriage with my husband and my daughter is also 14, same with that as my husband and I's daughter. And then we were blessed to finally have another child because we've

been trying to for a long time. What's the question for our run out of time honey? Sorry. So he recently gambled a lot of money. How much is a lot? I don't know, honestly. I just know that he won some money and didn't tell me about it until I started questioning why he all of a sudden had extra funds. I mean, are we talking hundreds of thousands? How much are we talking about? Give us a ballpark.

So I know that he had been giving me $1,200 from his paycheck every week and he has now confessed to me that he actually gets about $1,900. So we need to change our system. He no longer gets to give you his paycheck. It's direct deposited into our checking account and we decide what we are going to do with our money. And if that includes gambling, that is a mutual decision and obviously it would be a small enough amount that it

wouldn't affect the household. Right. If he can't go along with that, you have another problem. Yeah. It's a husband problem. The hard part is you don't know the exact numbers because there hasn't been that transparency. So the first step is let's add the transparency. See how does he react to that. Then you can know if your troubles go deeper than just that. Yeah. Are we dealing with a gambling problem or a budget and disorganization problem? If you're dealing with a gambling problem, you can't fix that until you fix the gambling problem.

Or you may find that you're dealing with a marriage problem if you say, hey, I want this level of transparency, and he says, I don't want to give you that. Do you see what we're saying? Yeah, I do. And I mean, this is not the first time. And trust has been an issue in our relationship for various different things beside the gambling. And I feel like every time I bring it up he gets a little better. Yeah, but he doesn't stay there. So we need to get to solving on this because

you're not gonna live like this the rest of your life unless you're crazy. You're not crazy. So you need to have all the account, all the money go into one account and we are in agreement on what we are doing with our money and trust will be solid. You know, one of the first things I discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies and there's too little life insurance or none at all. Grieving families are suddenly left behind scrambling to pay bills and trying to make ends meet.

I also discovered that there are a lot of rip-offs in the life insurance world like that whole life crap posing as an investment opportunity. What you need is level term life insurance, usually 10 to 12 times your income, which is the smartest, most affordable way to protect your family. The key is finding an independent broker who represents a ton of companies and works for you, not for the insurance company.

This is exactly what my friend Jeff Zander and his team at Zander Insurance are all about. They shop the term life companies to find you the best options and they've been around for over 95 years. So you know they'll be there when you need them. Zander is the real deal and that's why they've handled all my personal insurance for over 25 years. I trust them and you can too. Visit Zander.com for instant online quotes or for a more personal touch give them a call at 800-356-4282 Live from the headquarters of Ramsey Solutions, it's the Ramsey Show where we help people build wealth, do work that they love, or create actual amazing relationships. Jade Waschall, number one bestselling author and Ramsey personality is my co-host today.

Ashley is in Columbus, Ohio. Hi Ashley, how are you? Hi, I'm good. How are you guys? Better than I deserve. What's up? Well, we have a predicament. We have a very high net worth, but right now our financial advisor is suggesting that we

take a loan out on our vacation property, which is paid in full, there's no mortgage there, to help supplement our income since our money is not liquid. What is your net worth, hon? About $40 million. Oh my word. And you don't have enough income coming in off of $40 million. So it's a little tricky. 30 of that is invested in

the husband's business, which is close to about a billion dollar business, but we can only touch that when we are allowed to touch it. I'm sorry, if it's your business, why are you not allowed to touch it? So he's not on the board. So the board makes the decision on who gets money when. I thought it was your husband's business. Who owns it? He's one of the owners in the business. Who's the majority shareholder? There's a handful of people who own the chunk of it. He's one of those people. But he is not on

the board of directors, so he doesn't get to make the decision on when redemptions can be made. So, wow. Yeah. So the, well, that's 30 million, but you still got 10 million. You can't, you don't have anything in that that's creating income? Okay, so we've got four in retirement, four million in retirement. We bring, he brings in about 400 a year and he's a hundred percent commission based on what he does. So what do you

need money for if you make 400 a year? So what we were hoping to do and what we had been doing with the redeeming shares each year, then come to find out that we can't redeem every single year, was my husband's 56 and he's wanting to, after 26 years of service, he's ready to kind of back off and enjoy our vacation home and not homeschool our kids and be a little more present after being very very invested first hand in what he does so he was hoping to help to supplement our lifestyle with using some money from the HELOC. How much would the HELOC have been?

Okay, let's just stop. Let's just stop. Sure. There's no possible way that borrowing on your lake house is a good idea when you have $40 million. There's no scenario by which I can get there. And I'm really disgusted at how pitiful your financial advisor is.

This is just asinine. You make $400,000 a year. You have $10 million that's not tied up in this company and you guys can't figure out a way to get to some of that. How old is he? Could be six this year. Yeah. Yeah. Okay. And I've just recently taken over our finances as of April because I found out a Could be six this year. Yeah, yeah, okay. And I've just recently taken over our finances as of April because I found out a lot of stuff has gone on.

What do you mean? Well, for instance, I just, we got married 15 years ago. I trusted him completely. He made great money. I worked as well. We had three children together. I've been homeschooling them. I haven't heard anything wrong yet. What happened that was wrong?

So, he trusted that he would be able to redeem shares every year and didn't realize that he couldn't do that. Then we spent money assuming that we were going to be redeeming shares. Like in excess of 400 grand. Mm-hmm, like a million over. You spent the money before you had it. Yeah. Okay.

And how was that covered? Well, initially we were getting the redemption, so it was like, oh yeah, well we get the redemption at the end of the year. And how much was you redeeming of your $30 million installs? About a million, million and a half a year. And you were spending all of that? And now his income. On what? Hang on, keep in And now his income. On what?

Hang on, keep in mind, his income would drop down. I know, a million and a half a year on what? Well, we have two homes, we have staff in those homes. We have children. We're very generous with people. Still not gotten anywhere near close to a million and a half. We have a white horse farm that we pay for an ex-wife horse farm that we pay for. You have a horse farm that you pay for?

Not ours, ex-wife. Uh huh. Yeah. Yeah. There are some things. So I've consolidated quite a bit of that. None of this adds up to a million and a half dollars. Well, we, you know, chartering yachts and flying private. That all happened real fast.

Yeah, okay. Now I'm getting there. Yeah. Okay. All right. Yeah. So when I found out all of this, I said, I'm taking over. All right.

Well, there's not a I'm taking over. It's the two of us need to be both using our brain about the actual money that we have to work with. Correct. And what of the 10 million can we access? What percentage of this company does he own do you know? Oh gosh I couldn't tell you that. 1%, 12%, 82% we know it's not 82. Well of a billion. No, shares. What percentage of the company? What percentage of shares? I don't know. Now that'd be a good thing to know because he needs to

start taking some action because he has 30 million dollars tied up in something he has absolutely no control over. That is not okay. That is where your problem is. It is not a lake house home equity loan. Good God. Right. The last thing you people need to do is get it going into debt by be renting a yacht. Right. The last thing you people need to do is be going into debt by renting a yacht. Right. You just cut your freaking lifestyle. Just cut your lifestyle. Live within your means.

We absolutely have. Absolutely. I'm going back to work. Then you don't need to be having this conversation about borrowing money on your lake house. Okay. Live within your means. Now, then how do we adjust our means? Well, one is we we got to have a discussion

With these partners about how about my 30 million dollars, and I'm 56 years old I'm poured my life into this company, and how and when am I reasonably going to get access to that money? So we've had that conversation I I had that conversation and it was told to me crystal clear no questions asked We will never prioritize shareholder redemptions over the growth of the company. That's not the point. We can't divest.

We have an option to divest. Oh, good. They can do it in four years. The challenge with that is on the $200,000 that we invested in this company, it turned into $30 million. So you kind of go, you don't want to completely divest? Yeah, I do. Because we are making an incredible turn on it.

I completely want to divest. Absolutely. Okay. Because you are going to lose your butt. You have no control. And people are looking at you going, you have $30 million and you don't count. Yeah. Absolutely, I'm getting out of that deal. Yeah. Crystal clear, meaning they were arrogant, dropped their glasses down on the end of their nose and

man spoke you, girl. I mean, come on. Yep. Bull crap. I ain't putting up with that. I'm going to pay some taxes and get free of these jerkwads. No, no way. Redeem, redeem, redeem away. That's what I'm doing.

No chance I'm putting up with that crap. Because this story doesn't end well. When someone keeps control of 75% of your net worth and you have a $40 million net worth, you have zero access to it. Because darling, you don't understand how business works. We will never put redemption of shares above the growth of the company.

Oh, you've gotta be kidding me. So I think we're gonna handle that. We're just gonna redeem the dead gum shares. I can fix that. Oh my God. So no, and you may need a new financial advisor too. This one's an idiot. Borrow on a lake house to solve this spending problem?

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And you guys, in a world where strangers can Google your grandma and get enough info to scam her in just two clicks, Delete Me gives you peace of mind. Yes. So go to joindeleteeme.com slash Ramsey for 20% off. And that discount brings their annual plans down to about nine bucks a month. So go check it out. Joindeleteeme.com slash Ramsey. Well, buying or selling your home is a big deal with all the clickbait headlines and

conflicting data out there. Let me help you. When there's drama going on, you know how to fix it. Facts are your friends. Facts just put drama, just put it to sleep, it's done. So if you find out what's really going on, then all this all this stuff that's happening in the real estate market, it just calms you right down, okay? So here's the actual

facts. The median home price, which if you know anything about statistics, median is the number that's in the middle. Average is not necessarily in the middle. It's close, but they're close. Close to the same thing. But median is actually the far end and the other end and right in the middle. The median home price in America has gone up again this month to $441,000. That's the median. So when you tell me you're in Kansas City and there are no homes under $800,000, I'm gonna call you a liar. Okay? You haven't looked in the right neighborhood.

There are homes under $800,000 because the median in America in Kansas City would be pretty normal town, not above average, not below average, right there around the middle. Nashville, Tennessee, same thing. Louisville, Kentucky, same thing, right? These are all going to hover. That's going to be your house price median. Now I live in Williamson County, south of Nashville, which is the 11th wealthiest county in America and the wealthiest county in Tennessee. The median house price in Williamson County

is not 441,000. Show you're right. Okay? It's probably approaching a million. But it's crazy out here. So it's just a land that I live in right here where this building is sitting, okay? So I don't know where you live, but one county over, it's a lot less, okay?

True that. Probably. Listen, More County. Yeah, you go down one more county from here and you get a whole different world. Most of the people that work in this building live one county further south of here and not the 11th wealthiest county in the nation. So, anyway, $441,000, and by the way, that's up from $440,000 last month and $439,000 the month before.

It's averaged $1,000 a month is all. So house prices are not declining, they're increasing, but very slightly. That's the mathematical facts. 15-year fixed rates, still under 6%. So if you want to know more about this kind of stuff go to ramsaysolutions.com slash market. Alex is in Utah. Hey Alex, welcome the show. How can I help? I have a question about how I can help ease my wife's worries about not investing until after we're done paying debt off.

I think something that kind of adds to her stress is we just had our second kid two months ago and we don't have wills and life insurance, which I think is causing so much. Well there you go. Yeah. So you know two things to fix it. Go to mamabearlegalforms.com, get your will. Go to Zander Insurance, get your life insurance. You need to do that anyway, right now, today.

Now how old are you guys? So I'm 26 and she's 27. And how much, what's the timeline? Because obviously you're saying, hey, I want to pay off debt and build up savings before I invest, which is what we would teach. How long is it going to take you to do that before you start investing? It's probably going to be a few years. How much debt have you got not counting your house? So we don't own a house.

We have roughly 96,000. On what? So we have 64 on a truck and then another 2,000 on a car that we're going to pay off here in the next few months. And then $24,000 in student loans, and then $6,000 left on the birth expenses. Oh, cool. And your household income was what? Did you tell me that already?

Mm-mm. I didn't. No, it's between $125,000 and $135,000. I'm self-employed. Okay, cool. What do you do? I'm a company operator. I work in construction, just a foreman.

Okay. All right, cool. Good. Hey, wow. What do you do? I'm a company operator. I work in construction, just a foreman. Okay. I can help. Good. Hey, wow. So, I got great news. Your wife is going to feel a whole lot better, and you're not. Vroom, vroom.

You're going to get a will, you're going to get a life insurance policy, and you're going to sell your truck. Okay. Because your truck is stupid. So one thing with that is... Oh, don't give me one thing like that. You owe $65,000 on it, and your wife's afraid you're not going to get out of debt fast enough to start investing.

She doesn't believe you because you keep buying crap you can't afford. That's fair. The sucky thing is, because I bought it last year, it's worth maybe $37,000. Whoa! That's not because you bought it last year! Did you run a backhoe into it? How's it worth $37,000? No, I have 27,000 miles on it. So what?

It didn't drop $30, bucks in value in one year? That's what Kelly Bluebook said for a private sale. What? You're kidding. No. What kind of truck is this? Yeah, I was going to say, what is it? It's a 24 Tacoma.

And you didn't roll any negative equity in it? Nope. I got to tell you, man, I'm a huge Tacoma fan, a Toyota fan in general. I don't own one, but I mean, my perception is not only is that a quality vehicle, but it would hold its value a whole lot better than that. I'm really shocked. I think you must have looked that up wrong. I really cannot believe you cannot get $30,000 a year later for a Tacoma you paid $64,000. Yeah, it's pretty rough. I cannot believe you cannot get $30,000 a year later for a Tacoma you paid $64,000. Yeah, that's pretty rough.

I really, that's wacky. That's my conundrum is I'm upside down. Well, I mean, if you really are, I'm just saying I don't believe you. I think you looked it up wrong. I really do. I can't imagine. Although it's hectic today. Is there anything wrong with it? Did you add something crazy to it? Pop open, see if you can find it. I'll see if I can find it. I went and cancelled all the

warranties and everything so that's good. That's good, okay, we're on track. All right, so here's the thing. The reason that she doesn't want to stop investing is because she's afraid we'll never restart. Not because she thinks it's the wrong thing to do. If you really believe that you could be completely debt-free in two years by being on beans and rice, rice and beans, and then take a $125,000 income and invest that wisely for the rest of your life, you'd be multimillionaires mathematically, easily. That's the plan and yeah, that is the plan But that requires that you play all the way through and nothing in your old past indicates that to her So she's got to feel like a she has a vote on this budget be you're willing to do whatever it takes to get there And we're gonna get there as fast as we possibly can so because it's urgent that we start investing. Because your most powerful wealth building tool is your income and right now you're giving it all to Toyota. Basically. Yeah and so she knows that and so it's not that your wife won't go along with really stopping investing in

order to get out of debt, it's that she doesn't want to stop investing to never get out of debt. Yes, and that's like I've continuously expressed to her like, hey, we're done, like I'm done buying new vehicles. That was a stupid thing. I started listening to you guys like two months after I bought them, like, no, that was a stupid tax I'm paying now. Yeah, you are.

If that's the real numbers, I'm, God, I'm distressed because I just love that car. But I don't love it enough for you to keep it, but I love it. So all right, well, I think you guys keep talking through this, but that's what you've got to become of a common mind that we are willing to sacrifice in order to get there and we both believe it's really going to happen. She's afraid it's not really going to happen, that we're not going to play through. At my house when I was your age, I'm not accusing you of this Alex, but it was me, and sometimes this is true, I would come in with a new scheme

or a scam every week that we were gonna do. And if my latest one was we're gonna stop all investing to get out of debt after the other schemes and scams only lasted three or four weeks or three or four months, my wife would roll her eyes at that time and go, oh another one of those things you're not gonna play through on. Another one of your great ideas, Dave. And that was back 35 years ago. Today we're very much dialed in, very much aligned. Did you find anything at all?

I'm just, yeah, he's not far off. I'm just trying to understand how you spent what you spent to begin with and why I can find them for 31,500 and that type of price range. So I don't know what you did, but you did it. If you owe 60 on it. Unless you borrowed on a subprime loan and the balance is not really 60, but the total of payments is 60.

That's another possibility. Maybe that's not the real payoff. Make sure you got real payoff numbers. Maybe that's the number that's the wrong one. Fight through it, Alex. Fight through it. You're on your way. Hi, Anna. Anna is in Albuquerque, New Mexico. Hi Anna, welcome to the Ramsey Show.

Hi Dave, hi Jade, thank you for having me. Sure, what's up? So my question is, while we're working through the baby steps, how do we handle family dynamics and not seem like the cheap family? This sounds like expectations from Extended Family, yes? Yes. Like what? They are familiar. They are familiar with the Ramsey Method. They actually kind of introduced

us to it, but they have since, they have decided to kind of give up on it and they said to, they're going to make memories of their money now instead. Who was they? Sister, brothers-in-law. And so they've decided, Hey, it was too much for us. We're not doing it. And they think you should be in that boat. Whereas though you've said, Hey, no, we want to be intense. We want to pay off our debt.

We're going to do that. And they're kind of making you feel bad about it. Yep. Yeah. Give me an example. Yeah. So for example, they like to go to places where they play golf for fun. That, you know, is that recreational place?

Top golf. I said top golf. It's expensive. Yep. And we're a family of six. And so trying to cover that. And I have tried suggesting alternative activities for us to do and they often kind of respond with and it's boring. Well then, you know, okay, that's a great example. I mean, this is one of those times where you're just going to have to, Annis, put your foot down and say, we're not going.

I mean, I can't tell you how many times when Sam and I were getting out of debt that I would just say, hey, that's not a priority for us this month. And I might suggest something different and maybe I don't. If, you know, if everybody's going out. We just can't do that this month. Yeah, we're not able to go this month. And like I said, you can suggest another option. What if you guys all came over here and we did board games and if they say, no, that's not fun, then that's then their choice. So the same way you can't get mad, the same way you don't want them to get mad when you make your choice,

you then can't be offended when they make theirs, which is we don't wanna do family board game, we wanna go to Topgolf, okay, have fun. I hope you have a great time. Yeah. And it's just, it's not, we can't do it this month. But thanks for asking. Right.

Let's pretend something was crazy, okay, someone called you up and said hey I want you to charter a private jet and fly to London You would go I'm sorry That would be neat, but I'm not gonna be able to do that And why because it doesn't fit your financial picture. Right. Even though that person might be able to charter a private jet to London. Which by the way would be like 120 grand.

So it's not, it's just something you can't afford to do is all it is. Oh well. toughies. I mean, hey, we're all buying new boats and we want you to go get a new boat to match our boats. Oh, that'd be sweet. I wish I could, but I'm just not able to do that right now. I hope you guys enjoy your boats. In that moment with the extreme examples

that Dave is giving, you'd be able to see how absurd it is. That someone else is trying to manage your money. Yeah, and that they would be able to say what you can and can't afford. You realize how absurd that is. It's the same thing here. It's just a smaller, it's just a different scale. And you know you can't afford to take your family of six to top golf because you've got more important priorities but they don't get to decide that. What's the repercussion? Tell me is it even real? Let's decide is this something that's just taking place in your mind or if it's really happening? What happens when you say, hey thanks for inviting us we're not going to go this month but you guys have a good time? What then takes place? What do they do to retaliate? So they'll go ahead and do the event, which is fine.

And then I guess it does put it on us to maybe try to set up something else outside of that event at a different time. See, and I don't think it does. I think you kind of created something that's not even really there. You just didn't go. That's all it is. You just didn't go. That's all it is. You just didn't fly to London. I think they're just getting tired of us saying, sorry, we can't afford that.

Who gives a crap what they think? They don't get a vote. Listen, people that love you are supposed to encourage you. That's right, Dave. Not send you on a, not be travel agents for guilt trips. You are way too worried about what other people think, kiddo. Just smile and be happy and happy that they want to go to Topgolf. Hope you enjoy it. Topgolf's fun, but it really won't change your life.

And can I just, I'm creating something here, but can I just say these types of people are the same people that when you do get out of debt, Anna, and your money is looking good and you do have margin, and maybe you wanna do something beyond Topgolf and they can't afford it, these are the type of people who will be frustrated then at you for that as well. Does that make sense?

You're not gonna win with these folks. Yeah, when you have $2 million in your account and you guys are going to go away for an expensive weekend at the montage and you want to invite them, they're going to be going, well, wouldn't it be nice? Yeah, that's right. Wouldn't it be nice if we were like you? Yeah, well, it would have been 10 years ago if you'd have had a dad gum half an ounce of maturity and learned to live on less than you make.

But you know, you just have to keep all that to yourself and you have to be sweet, be kind and just know I can't go and quit reading into it that somehow you've done something wrong. Even if they think you have, they don't get a vote. The biggest superpower you can have with your money is not caring what people think. That's the number, if you can accomplish that mentally, you can go further faster.

Well, because that, Jay, bleeds over past this type of discussion, because it bleeds over into the, I'm not buying the crap I saw on Instagram to make people think I'm somebody. You don't care. I don't need to buy, I don't need to carry a purse, I don't need to wear a shirt or shoes or drive a car or live in a house or go on a vacation for someone else to look at. And I was that guy in my 20s. I really, I bought a Jaguar, I had a Rolex, I had a,

you know, custom-made suits. I wanted, when I was making a little money back then before I went broke. And I really wanted other people to be impressed. And one of the benefits of going broke is I lost all of that. My need for you to be impressed with me is zero. I hear that. I hear that. The only thing I want to do is just love you and help you. And if you're not impressed, fine.

If you are impressed, that's fine too. Life's good, go on and do your thing and I'm probably never gonna see you again anyway. So good luck with that. And you know, impressed, fine. If you are impressed, that's fine too. Life's good, go on and do your thing and I'm probably never gonna see you again anyway. So good luck with that. And you know, it's okay. Because I'm not gonna spend, now I've got a nice car, I got a nice truck, a nice boat, whatever.

But it's for me. It ain't for you. It's not for you to look at. I don't care whether you know what I drive. I think that is one of the benefits of when you do walk through the baby steps, as we teach it more importantly, when you walk through the dead snowball, right? Because you're sad, you have to not care what people do.

Cause you're sacrificing and there's part of that. You can't hide that. It shows. And so you start getting used to it showing you get start. You start getting used to wearing the same clothes. You get used to, uh, staying going out to dinner. You get your drag war repo to show. Yeah, that'll knock you out. That's a problem. And so, but. It ain't there no more.

The positive side of that is yeah, you kind of burn out that part of you that cared about what other people think. And when it's gone, that's a great place to be. Yeah. Your confidence comes from a different place. It's kind of sweet when it's coming from her because she's kind of sweet.

Yeah, she's sweet. But just, it's coming from her because she's kind of sweet. Yeah, she's sweet. But it's not got any power. The power comes from I love you, I want good things for you, but we're gonna do our thing over here. Over here, we're gonna do our thing. That's what we do over here. And if you're gonna be mad about that,

then you're just gonna have to be mad about it. I'm gonna vote for who I'm gonna vote for whom I'm gonna vote for I'm gonna Travel where I want to travel and by the car. I want to travel I'm just not my need for you to be okay with that is really really low. Yeah, it's different You know when you're in debt You are your self-esteem is low and you're trying to cover that up with Buying things and going places and doing things. It's a different motivation than when you're on the other side of it. The list of things you want even changes because

it's coming from a different place. It's not coming from insecurity. Hmm, good point. Interesting. So Anna, honey, they don't get a vote. Just smile at them. Have fun at Topgolf, y'all. See you next time we have dinner. It's all good. Sarah is in Los Angeles. Hi Sarah, what's up? Hey, how are you all? Better than we deserve. How can we help? I doubt that.

I think you deserve it. I just received $100,000 from my parents. I'm married to my husband and I just received this. Wow. And I know. As a gift or was it a, did someone pass away? It was a, it's a gift. Okay. It's a gift. They also gifted my brother the same and his wife. And so I just want to make sure I do the quote right thing with this money. I'm looking at

paying off both of our cars first. We don't have any credit card debt. We pay it off every month, but I'm actually'm actually gonna stop using a credit card Wow I like you already Well, thank I appreciate your guidance So I felt like the credit card was not optimizing my savings like it just I was spending more Yeah, then yeah, yeah, it just does that for some reason. Okay, so your only debt other than your home is your cars That's it. Yeah, and how much are they what's the debt on them so? 16,000 on one and seven thousand on another okay. That's kind of a no-brainer good

Okay, so 23 of the hundreds gone, okay? Yep, and then I was thinking about doing about $32,000 in an emergency fund. That would be four months of my husband's income. You don't have any money in an emergency fund today. We have $3,000. Okay, oh, that would put you at $35,000. Okay, I got you. I'll see what you did. Very good. So, and like that would be, I assume, and we have it just in like a high yield savings Is that where you would keep it? Yeah, it's liquid You're doing really good. I like it like I like your plan so far a lot. What's the next part?

Okay, good good good And then the car payments I was gonna put towards my mortgage the car payments that we would have had. Mm-hmm Not sure what you think about that It would be the main thing I would just do is I would do a budget and I'd start putting 15% of your income towards retirement, doing something towards kids college out of your budget and then out of your budget, which includes no car payments now, then I'm going to put some extra on the mortgage. I don't know how much. It may or may not equal to the old car payments. Okay, I see. Yeah. Because I just want you to do a budget and find money in

there to live and now you move from intensity to intentionality because you're in baby steps one or four through six which is 15% into retirement, kids college savings, and then systematically pay off the house while enjoying our life. Were you already investing? It sounds like you were. No we're not. Okay. We have not invested yet so that was kind of my next step. If I have a little bit left we do want to paint our house because it's crumbling and do a couple of things to help improve my side hustle, which is our Airbnb in the house. After that, I don't know where to start for investing.

And also another piece is my husband is 20 years younger than me, 22 years younger than me. So I'm 54, he's 32. I wonder if that factors in at all for. Well I wouldn't pause investing to do the things that you're talking about with the home. Investing is something that it's kind of like you set it and forget it and it's the new normal.

My guess is that once you pay these cars off, basically that money that you were paying in car payments, you're now gonna feel that go away and you're 15%, that and some, and you're 15% that you're investing every single month. So turn that on immediately. Once you park this money in the savings and your emergency fund,

turn the investing on immediately because you'll be there. We still got about 50 grand we gotta decide what to do with. Right. And what was your plan with the other 50 grand? I mean, I was gonna get a new tooth because I had some of my teeth from it.

I gotta get a new tooth. Unfortunately, I live in a very expensive area. It's gonna be about eight grand. Get your tooth. Get my tooth. Yeah, you need to get your tooth. Get my husband's life insurance because we have it on me, but we don't have it on him. Okay, that's smart.

Get a will. Pardon me? Get a will. Yes, that's smart. Good, good. Get a will? Pardon me? Get a will? Yes, yes, we have a will. Good, good. Like budgeting, like I said, I was using the credit card and I just noticed that we could pay it off, but I kept stretching it every month, so I want to stop doing credit. I was trying to get air miles because my baby girl's going to college across the country.

So I wanna be able to see her, but I'm wondering. Yeah, I think you just pay for your airline tickets. Have you received the 100,000 yet? Yes. Okay. Do you have the credit card? Do you still have it? I have the credit card, yeah. Why don't you pull it out of your wallet right now and cut it up?

Okay. I think that would be a great way for you pull it out of your wallet right now and cut it up. I think that would be a great way for you to turn over a new a new leaf. Why save for tomorrow what you can do today? Yeah, that was my point is like, I couldn't I just save money for airline tickets? Yes. And actually have money for airline tickets. So you need to get on the Every Dollar budget and it'll walk you through all these baby steps as well as help you plan with your monthly spending that you and your husband can agree to.

So we'll give you 14 days of free premium version. You need to try this new version of Every Dollar we just came out with. You're going to love it. It's going to hold your hand and walk you through all the things we were just talking about. So now you're debt free, you have an emergency fund, you're living on a written plan so that you're spending money wisely. Oh, $8,000 for a tooth, and so we have $42,000 approximately left.

$32,000 and yeah, no, no, no, no, no, it's not quite that much. It's like, but anyway, whatever we've got left, I still want you and your husband to sit down. I would recommend that you plan to enjoy some of that. I agree. That might be a small trip, it might be a new couch, we might need a new bed, we haven't bought a mattress in 15 years.

It might be- Oh yeah, you said you wanted to paint the house. If you want to paint the house, if you want to upgrade a car a little bit. But all of that is with cash. We're not going back into debt if we just turn around and cleared the debt. Right. And so just take a yellow pad, put $100,000 at the top, and you and your husband sit down and give every one of those dollars a name. We know sixteen and seven went to car, we know eight went to tooth, we know thirty-two went to finish up the emergency

fund. Okay, so you just keep working your way down until the money has already got a name. Because if you don't do that, what we all all do if we keep it just kind of floating around in our brain is we spend $100,000 four times Yes, yeah, and you end up worse off than if you hadn't gotten the thing And and and you also have this horrible taste on the back of your tongue called regret So yeah, you just have a diligent plan and it's not going to go as far as your emotions wished it would. It's not going to go as far as, 100,000 isn't what it used to be.

Well, that's true. It's just not. But it's getting a lot done for you. It's getting you out of debt. It's getting you an emergency fund. You're advancing right down these baby steps and getting yourself in a position to really build some real wealth. I know.

I'm slaying the baby steps, it's so fun. I'm so appreciative of my parents. How do you restock your emergency fund? Do you put a little bit every month? You don't need to restock it. You don't need to, but let's just pretend you did have an emergency fund and an emergency happened, you spent $3,000 on a new AC. You put it back as soon as possible.

It becomes the 30-day back as soon as possible as quickly it becomes your 30-day challenge As quickly as you can and I'll tell you what else if you did end up using it. I'll be shocked Because once you get to the stage that you are now at and you've got enough income coming in and no payments going out a lot Of what used to be an emergency becomes a monthly budget item Like if you had a $3,000 hit and you got no payments in the world, you can just tighten up the budget real tight one month and just do it and not even hit the emergency fund. So what used to be an emergency, a flat tire is no longer an emergency, it's just a crap, I got to take that out of

this month's budget. And you can actually cash flow through them. Okay. And what about for vacations? So- can actually cash flow through them. Okay. And what about for vacations? Save up and pay for them. Separate account for that? Yeah. We can have a separate account or a separate line item within an account. Same thing as Christmas.

Yeah, I'll tell you what I do practically. I looked it up, by the way. Christmas is in December this year. I'll tell you what I do practically. I have a separate banking institution for my emergency fund because I don't even like looking at it. I don't touch it It's just over there And then any other normal savings for trips and things like that can be in the other bank They can all be in one account

But just kind of keep a little spreadsheet on how much of that account is for trips how much is for Christmas? So on that kind of thing just keep a breakdown on it It's called a sinking fund when you're working your every dollar budget. It'll help you do that too. I was sick and tired of being sick and tired, bankrupt with a toddler and a brand new baby at home, scared doesn't even begin to cover it, but I got mad enough to change. I started using God's and grandma's ways of handling money. That journey became the total money makeover, a plan everyday people can use to take control of their money. Millions have changed their lives following the plan in this book and found hope. Start your makeover

today at ramsysolutions.com slash store. 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. Jade Wachow, number one bestselling author and Ramsey personality is my co-host today. Open phones at 888-825-5225. Ron is with us in Honolulu. Hi Ron, how are you? Great, how are you Dave and Jade? Better than we deserve sir. What's up in your world?

Hi, sir. I'm a 49 year old active duty army officer I'm got 26 years and married with three teenage daughters. Thank you for your service. I was diagnosed. Thank you. I was diagnosed with cancer last month and in the process of kind of getting our finances in order, I was able to sell my truck and make $20,000 profit. I was trying to get some advice from you all on with the current market where it stands, what would be the best use of that money for investing either lump sum into the market or gradual over time. Wow. What is the prognosis of your cancer diagnosis? We're still not sure yet. We're obviously trusting God. I had surgery last Thursday

and we should get the pathology back this week. But we're hopeful it was a miracle was caught as early as it was. So we're optimistic. So the optimism is obviously part of your faith, but it's also the fact that you caught it early? Yes, sir. All right. Okay, and do you guys have any debt now other than your home? No, sir. We actually did Financial Peace University in 2010. And we live on base now in Hawaii, so we don't own a home, and we've been investing for quite a while. Okay. And so what is the size of your nest egg, sir? With my wife and I's Roth IRAs, we have about 750,000 total invested between the two IRAs

and my TSP. Our emergency fund is just under 30,000. Man, you've done a great job. And part of our. Man, you've done such a good job. Really good. Such a good job. All right. And any life insurance in place? I have my SGLI and then I have policies on my wife and daughters.

On you, that's $200,000, right? On you. That's $500,000. $500,000. Oh, right on you? It's 500. 500, okay. Oh, officer, okay. Yes sir. Okay. Wow.

And you got a will in place? Yes sir, we have a will. We, thankfully, we've got a will, all the things legally that we need in place for my wife and daughters. Good. So they'll be able to get the life insurance and all the everything else that we've got in this. Because my experience in these situations is just looking in from the outside like I am now that when you have checked all of those boxes and you've got everything tight, you got a tight

situation, everything's up to date, ready to go, you don't have to think about those things. You can put all of your energy in fighting cancer, which is where, ready to go. You don't have to think about those things. You can put all of your energy in fighting cancer, which is where it needs to go. Yes, sir. Okay, so we don't have to think about all this other stuff because you've done such a good job. Your prep on life in general is so grown up, so adult, so well done, I'm so proud of you, very, very well done.

So all of that to say, the20,000 where it's invested or how it's invested is not going to change your family's life. All the other things you've done is going to take care of your family whether you live or whether you die. Okay? And so the other the rest of the picture we've just been discovering since you called in and how wonderful a job you've done is what takes care of them. 500,000, 750,000, no debt, no house debt, living on base. I mean, you guys have got, you have a detailed, well-executed plan.

So she's fine. They're fine. Whether we take the 20,000 and burn it in the middle of the floor or not, they's fine. They're fine. Whether we take the $20,000 and burn it in the middle of the floor or not, they're fine. So that's not to say we don't want to do something smart with it. Now, having said all of that, what would I do if I had an extra $20,000 laying around? I'll tell you what I would do with it. I did this afternoon. I'd dump it into an S&P index fund and just throw it in the market. It may be worth $15,000 a year from now and it might be worth $25,000 a year from now and neither one of those numbers

are going to change my family's life and neither one of those families numbers are going to change your family's life. I don't know what the stock market is going to do but it goes up more and it goes down and over time it's gone up if you leave it alone. So if you leave it alone five years, you have a 97% chance based on history that you're going to have more in there than you should put in. And if you go to heaven and she's got a 97% chance if she leaves it alone five years, that it's going to be worth more, right? And so, me, I'm just going to grab an S&P 500 fund or sit down with your SmartVestor Pro,

whoever's helping you with your investments and pick a good growth stock mutual fund and drop it in there and forget it. And then, who cares what the news says tomorrow? Because if you read the news, it may go down tomorrow right after you do it. But I don't even, that's not my motivation. My motivation is I'm putting, I don't need the money, I'm gonna leave it alone a long time and you're gonna leave this alone a long time, right? Oh, definitely.

So if you're investing it, which means you're gonna leave it alone a long time, that's the definition of investing, five years or longer, and that's your mindset, three years or longer, you're gonna make some money that way and I would just lump sum it. But you've got to commit to yourself to not go, oh no, I turned on

Fox News this morning and President Trump burped and the mock stock market went down because when he burped the French burped three times and the Chinese burped five times and oh my god and this this is what happens and then the market goes back and forth the market goes back and forth that's exactly what happens how long do you plan to live on base? There's still a lot of unknowns on whether or not I can continue to serve and whether or not I'll need to retire and move back to the mainland. So, I mean, we're, we're secure. If whatever long, however long we need to be here, the army's taking care of us to get treatment and stay here.

You might, you might factor that into the investment of that money if you think that it's less than a five-year play for you to be on base. It might serve as some down payment going forward. That's just one thing to think about. Yeah. But it's probably a two- or a three-year play anyway. So, yeah.

Cool. play anyway. So yeah, cool. Ron, I just got to tell you, I'm so sorry that you're having to fight this, and I'm so proud of you, the job you've done as the dad, as the husband to take care of your family. You have just done a stellar, exemplary job. Yeah, really good. It's amazing. Thank you. Thank you, and we'll keep you in our prayers brother You're gonna be fine. Oh Man Wow It's so weird

The Sense of I have my act together and of I have my act together and how that factors into a wellness equation when you're fighting an illness or even a terminal illness. I've got several friends right now that are facing different kinds of dramatic health issues and the way they are reacting is based on two things their faith walk their spiritual walk and whether or not they know everybody's gonna be okay because they got their act together yeah they got their act together if you got your act together and you know it then you could just kind of put that to the side

and work on what's important you know it's pretty incredible wow another reason yet to do this stuff, boys and girls. with some exciting news for our Financial Peace University coordinators. If you've ever led FPU or even just thought about it, you've gotta join us for our coordinator rally happening on July 24th. It's packed with insider updates, powerful stories, and encouragement from me, Jade Warshaw, and Dr. John Delaney. It's totally free, and when you register,

you'll be entered to win our $3,000 giveaway. So, just head to fpu.com slash rally to save your spot today. That's fpu.com slash rally to save your spot today. That's fpu.com slash rally. John is with us in Canada. Hey John, welcome to the Ramsey Show. Hi Dave. Hi, what's up? I am in a massive amount of debt and I don't know what to do. I just feel like it's a huge weight on my shoulders.

We owe over $400,000 between credit cards, credit lines, and a car loan. And our take-home pay after taxes is around $13,000 between my wife and I. And our expenses is about $13,000 between my wife and I. And our expenses is about 10,000. This is after we stripped out everything. So how much on credit cards? On credit cards and line of credits, around 350,000. What's that a result of? So it's twofold. So we faced a deposit on a house during COVID and we were selling our

house at a profit originally. The buyers couldn't close on it so we ended up selling and taking a loss and to close on the other house without losing it. I had to take money out From our credit line to pay so that was about 150,000 at the same time I got really sick and to the point where I didn't think I was gonna live and so when I got out of that Something I guess this switch flipped in my head saying, why am I being so frugal about money?

Because I used to follow the Dave Ramsey principles very, very, very good. And we were pre-2021, we were out of debt. And so I started, because of this illness, I just started spending. And so it went down this spiral. And now I've learned being in $400,000 of debt and mentally better, it wasn't a good decision.

And so now I have to stress them. So you own a home? We own a home. It's worth about a million dollars. We owe $850,000. It's worth about a million now because it's down, but a year ago it was probably 1.2, 1.3. Okay, why is it down?

The Canadian market has taken a hit because of interest rates here. Oh, okay, okay. Yeah. All right. So I guess my question is, when does it make sense to consider bankruptcy? Because I'm doing my numbers here,

we're paying this $3,000, I'm trying to do Ubers and whatnot on nights that I can. We're throwing everything at the debt, but when I do the math, it's $36,000 of interest annually, and I'm only putting in $3,000 a month. So to me, it's like the vicious cycle. Are you well now? Are you healthy? I am. I am better, but obviously this stress of debt is mentally a burden, and I'm connected to the right therapist. Okay.

We have insurance as well. So I don't know Canadian bankruptcy law at all. In the U.S., where you're to file bankruptcy, you would have the option of keeping the car and keeping the house by reaffirming the debt, which means you don't bankrupt on that debt, you keep that debt and you keep the asset, which would absolutely be asinine, obviously, but if you're going to file bankruptcy. So, and again, I don't know Canadian law. I have to assume that they have collateralized those loans somewhat like they do in the US,

though. If I woke up in your shoes and again subject to not knowing the laws there and I would want to know that to know what was possible there or how that thing works but if you were in the US it'd be very simple for me to tell you because I do know the law there are here. I'd sell my car and sell my house. Yeah, my car, so we have a Tesla. We owe $80,000 on it, but we bought it when that was at the top of the market, and it's worth, based on Auto Trader, which is similar to Kelly Blue Book, about $40,000. So it would be underwater about $40,000. I'd sell my car and I'd sell my house. Okay. Because you have huge car payments

and you have huge house payments. Yeah. And you have a decent income. And if you did that, you can clean up a portion of this debt, over half of it. And then you would just plow through the rest of it, get your life back, and then start rebuilding again. Because the house doesn't have much equity in it. It's not like it's some kind of big prize. Right. And other than it's probably a nice home. But it's a serious burden. The Tesla's serious burden. My guess is there's... I would just take the $40,000 that I'd be underwater and just add it to the debt. And is there anything in the house?

I mean, this is a lot of spending in a short period of time. Anything in the house that you can sell and liquidate and get rid of? We've been doing that, yeah. We've been putting everything and anything on Facebook marketplace. And it's, it's been, I mean, we've been getting, you know,

50 to a hundred to $200 here and there that we've been throwing on. And we continue to do that. But there's no big item you purchased in the spending spree. Yeah because you left out selling the Tesla that's why I'm saying is there. You left out selling the motorcycle or the C-Doo or the snowmobile. Yeah we I mean we have TVs but I don't know how much those are worth. No that's not what I'm talking about. What did you spend money on? Yeah, it's really bad. Just trips.

Okay. Okay. All right. Yeah, we can't get those back. Hard to repo that, but okay. Yeah, I'm just gonna fight my way through this and you're gonna take some lumps here. This is not gonna be pleasant,

but neither is bankruptcy, by the way, because you're turning in the Tesla, you're turning in the house, you file bankruptcy anyway By US law, but now I don't know Again what Canadian law is but I can't imagine a bankruptcy process In a North American country like Canada that allows a bank to not get their secured position, right? I would be shocked

secured position, I would be shocked. Thus a mortgage or a loan on a Tesla. They at least have a lien against the Tesla, they have a lien of some kind against the house and that lien is protected in bankruptcy in the United States and I suspect it works the same way somewhat there. It's logical that it would. But again, I do not claim to know the answer there. I think you guys just went through a series logical than it would. So, but again, I do not claim to know the answer there. I just,

I think you guys just went through a series of large bad decisions and now you're going to go through a series of hurtful good decisions to clean up the mess from the bad decisions. So you got about two years minus a house and a Tesla to get your life back and then you start fresh again. That's what it sounds like to me. I think you'll be free in about two years. Because you make pretty good money but you're consuming all of it still. And you've justified that as like this is our minimum baseline.

No it's not. Million dollar house is not a minimum baseline. Nope. And neither is a Tesla for God's sakes. Not a minimum baseline. No, it's not. Million dollar house is not a minimum baseline. Nope. And neither's a Tesla, for God's sakes. Not a minimum baseline. So not even if you're George Campbell or Rachel Cruz. So there you go. Abby is in Jacksonville, Florida. Hi, Abby. How are you? Hi, great. I have a question. My husband and I are currently debt free with the exception of our house. We're wanting to buy a specific business. And my question is one, do we buy the business? But more importantly, two, do we pay cash for the business or do we pay out a loan?

You don't buy it unless you pay cash for it. Okay. Do you have the cash? Yes. How much is it? We have about Do you have the cash? Yes. How much is it? We have about $220 in a high-yield savings account. What do they want for the business? $80,000.

What is it? It's an after-school enrichment program. Why do you want to buy it? I want to buy it because he loves what he does, so nothing would change with his job. I'm a pediatric oncology nurse. I've been doing it for 15 years, and I'm just looking for something else, something where I can be home with my kids more and just run my own business with my own hour. What's the business profit the business profit net profit?

Last year fifty thousand okay, and they want how much for it 80,000 okay, that's a that's a good return That's a cheap price So I want you to investigate carefully what's going on because if it truly made 50 grand it's worth more than 80. But get into it and figure out why they're selling it, what they're doing. If you've got 200,000 bucks in the bank and you want to pay cash and write an 80,000 dollar check and start your next business and move on to the next thing after, yeah, I can't imagine the job you've had. Ouch.

Whew. Rewarding, but also trauma-filled. Yeah, that's right. Yeah. Wow. I don't blame you. This is The Ramsey Show. Hey, what's up? Dr. John Delaney here. The new dates have dropped for the money and marriage getaway over Valentine's Day weekend in 2026. This is your chance to hit pause on everything

in your life and reconnect with your spouse over a long weekend in Nashville, Tennessee. Me and my friend Rachel Cruz will be digging into topics like sex, money, communication and more. This weekend is happening on February 12th through the 14th and early bird prices start at $749 per couple, but the prices will be going up soon. Get your tickets today at Ramsey solutions question of the day is brought to you by WhyRefi. When the payment on your defaulted private student loan is as much as some mortgages,

it's hard to get ahead. That's when YREFY can help. Refinancing to a low fixed rate loan built just for you. Find out more at yrefy.com slash Ramsey. That's the letter y-r-e-f-y dot com slash Ramsey. Might not be in all states. Okay, today's question comes from Shannon in California. She says, My husband and I disagree and we'd like for you to weigh in Dave and Jade. Our son is 15 and recently got his first job. My husband wants him to put the majority of his money into a Roth IRA and take advantage of all that compound growth. While I don't hate this idea, I think it's better for my son to invest

his money in something Accessible for college or a home-down payment in the future. Our son is open to both options Which would you choose for your child? And if you prefer the savings option, where would you invest it? Okay Yeah, I tend to agree more with it sounds like the wife. However with a couple of changes So I'm going back to when I was 15 years old, I was working at Kroger's grocery store. If somebody said, hey, Jade, you got to take all of this paycheck and invest it, I would lose all motivation in that moment to keep working and bagging groceries at Kroger. So there's part of this where you do want them to do the three things that we talk about with money. You want them to give some, you want them to save with money, you want them to give some you want them

to save some and you want them to be able to spend some. So I never heard you talk about him being able to spend any of this. So that needs to be part of it, as well as the giving component. And then with the amount that he chooses to save, yeah, I'm with you, Shannon, I would keep it liquid, and just a savings account. Because yeah, you're right college is coming up Maybe he's gonna want to purchase his own car. You didn't mention a car So there's just a lot coming up on the horizon that you're gonna want your hands on that cash and it's less than a five-year

Play which is why I wouldn't invest it. It's college. It's you know planning for Whatever those costs are it's planning for him hanging out with his friends, him having an emergency fund, all of that. So yeah, I'd keep it liquid in a savings account and don't be too much of a drill sergeant with this money. Let him enjoy some of it. Yeah. So mathematically, here's where you're making a mistake. Both of you think this matters. This 15 years old he's not gonna be making that much money. I mean what's he making? 100 bucks? 98% of what this kid needs to take from this is the lesson. 2% is the actual investment decision. If he can learn to live with a plan,

he can learn to work hard, make some money, put it to a plan, spend some of it wisely, be generous with some of it, and invest some of it, you have laid the groundwork for the young man to become a multi-millionaire. It's the lesson that matters. The reason that you buy groceries at Kroger when you're 15 is not because there's money in it, because there's not any. No, it's because you want to go out with your friends. You learn to work. You learn work is where money comes from. And the first time you get a check and they see how much taxes come out of it,

you know how to vote after that. I know that's right. Golly! You know I mean, gee! And so on. So you learn to work. Work is good. But you're not really teaching, you don't really, a teenager is really not working because the result of the work is going to change their life. No. The groove that drops into their brain called work ethic, the neuroscience of it that resides there for the rest of their life, that's what changes their life.

And so we're teaching them to work. Whether you get an A on your term paper in the sixth grade or you get a B, matters not at all in the scope of your life. What matters is what did you learn during the discipline of not waiting until the last night to write the term paper, of doing the academic rigors of putting the paper together properly to footnote it properly so that you learn not to plagiarize and you learn how to, you know,

but the actual difference in the A and the B doesn't matter. What matters is did you do the work to get there? Because honestly, no one has ever gotten hired or fired based on whether they got an A versus a B in the sixth grade. Through that? Ever. But some parents act like it.

Some of your parents lose your freaking minds on this stuff. So don't major in minors, major in majors. So the money from this 15-year-old doesn't matter. What matters is he's learned to work, he's learned to give, he's learned to save and invest and you can put it in a Roth if you want to, you put it in college if you want to. I tend to agree with Jade, let him put it towards college and make sure we get through college debt free, that's a better investment than a Roth. If you pay cash for your education, whatever form of education he chooses to engage in and he puts some skin in the game on that. I think that's a much

more valuable than the actual 12-14% whatever it is you're going to get on your mutual funds in your Roth IRA. Now, having said all of that, once he's doing all of that, if you guys have some extra money and you want to file a tax return on the money that he earns and you pay the taxes, if there's any taxes due, there probably won't be, and then you file and open an IRA. I did that on the kids, but it didn't cost the kids anything. I just had some extra money and so Rachel Cruz made $1233 babysitting and walking dogs

and whatever else she did, working at Lululemon or whatever it was she did, and we filed a $1233 tax return, put $1233 in her Roth IRA when she was 14 or 15 years old, okay, and did that at 16, did that at 17, but that wasn't her money. That's just because she had some earned money that gave me an opportunity to put some money in her name. Now that was fun, and the result of that when she was 25 was pretty, that was worth doing. But it's not like the 15 year old became wealthy based on their income and investment strategy. They don't.

They don't make enough. There's not enough money involved here for that to matter. What really matters is the lesson in building those muscles. That's very cool stuff. Shane is in Detroit. Hi Shane, how are you? I'm doing well, how are you? Got a bad connection. Try one more time. I'm doing well, how are you? Better than I deserve. What's up? So I'm recently homeless. My car just got repossessed, which was my house. um I'm I've got like 300 saved up I was wondering what would you do to um just get yourself back up on your feet how'd you end up living in your car

I was in foster I don't really have family or friends so um I was with Mike Chianti and then we broke up okay how you? 23. I think me for in August. You're what? 23. 23. 23. Okay. What are you working at all? Um, no, my job, well under, um, they lost their contracts and I've been applying. I have about 200 job applications out. Um, not really sure why nothing's calling. But again, I have no car. So I don't have a way to get to these job applications either. Where are you right now?

I'm couch-surfing at the moment. Okay. Right now I'm in a buddy's house for the next few days. And then I'm going to be headed north. To be staying with another buddy's house for a couple of days. From there I'm not sure. Okay. Alright, so the first thing I need you to do is I need you to get plugged into a strong community that can help you walk through this time. So I want you to find a good local church in the area that you're going to land in, whether it's this buddy's house or the next buddy's house.

And you need to define how long you're able to surf their couch, okay? So that you're not overstaying your welcome, but you're also taking full advantage of their generosity, not in a manipulative way, but you're able to use that. So I want you to plug into a good church and let the pastor know at that church that you've aged out of foster care and what you're facing, okay? And if you'll hang on, we'll hook you up with a church in that area where you're going to be, and then, yes, we have to get a position of some kind. And it's probably not about filling out applications, it's probably about connecting to a human to actually get a new job, start earning some income, get a thousand dollar beater car, earn some more income, get a one bedroom apartment, earn some more income, and then

begin to work on your career. We got to get sustainable first. Hang on, our team will pick up and we'll guide you son. Our scripture of the day, Remember the Lord your God, for it is he who gives you the ability to produce wealth, and so confirms his covenant, which he swore to your ancestors as it is today. Deuteronomy 818. Earl Wilson said, Benjamin Franklin may have discovered electricity, but it was the man who invented the meter who made the money. Oh, that's pretty good. If you're feeling stuck and overwhelmed with your money, you don't have to stay there. The Total Money Makeover is the crash course that helps you learn the Ramsey Plan, how

to beat debt, build wealth and take control. It walks you through the seven baby steps in plain language. It's fast, it's clear read, most people finish it in a day. Over 10 million people have picked it up and it's helped them finally get it. Get your copy at ramsysolutions.com slash store or click the show notes if you're on YouTube or podcast. Carlos is in Melbourne, Florida. Hey Carlos, how are you? I'm doing good, Dave. How are you doing today? Better than I deserve. What's up?

Hey, I am calling in. My wife and I are expecting our first daughter to be born any day now. Wonderful! in any day now. Wonderful. Yes, very exciting. And we have about $6,000 in a savings account that we've been stowing away and are planning on using that for the cost of birth and any unexpected things that may come along with that. How much is insurance covering? We're going to find that out. We should have met our deductible through all of the prenatal screens and things of that nature. So as we move forward, we're ballparking based on her coworkers, we're on her insurance,

and what some of her coworkers who have recently had kids have said to expect around 5,000, maybe some more. I know it'll be different with each situation, but that's kind of what we're ballparking, where we'll be able to spend the 5,000 and then still have a little bit of money saved afterwards if all goes well. The reason I'm calling is because I have I have 17,000 in my 401k and I know that we're able to withdraw from that 401k, penalty free, it'll still go on taxes as taxable income. I've done the research and it won't change our tax bracket if I do take the

$5,000 out of the 401k. Nope. No. No. Absolutely not. No. Okay, so my wife was right again. No. Yeah, she was right again. Yeah. What's your household income? We take home about $7,000 a month. Okay. Just rebuild your emergency fund as fast as you can if you have to use some of this money if the insurance doesn't cover it, if the co-worker version of the estimate was right. I don't like that methodology for discovering how much you're gonna earn or how much you're gonna owe. I think I would just rather talk to the health insurance company and find out what my deductible is and what my copay is and what my max out-of-pocket is and see how far up the ladder you are on

that. Because you might get actual information, real information, and find out it's $3,000 and then this whole discussion was for nothing. Okay, got it. Yeah, I don't use co-workers who are broke people as my guideline for much of anything. Okay, got it. And you feel that maybe if it is less, whatever the case may be, everything will be alright, I don't need to take out that. Let's pretend it's 8,000, okay? You take the 6,000 out and you pay it towards the 8, and you cover the other two out of your $7,000 a month income. First finding out what your deductible or out-of-pocket max is.

Sometimes it's the same number, sometimes it's different, but knowing that, I mean, and prepping for that, that's what's going to give you ultimate peace of mind. Yeah. Congratulations on the new baby by the way and the great news about that is is it makes you get very serious Some people most people about getting your crap together. Yeah, it does I mean you really start you start saving you start getting out of debt you start living on a budget you start being like Grown-ups and stuff because a shocking thing I'm responsible for this because a shocking thing, I'm responsible for this helpless little small person will wake your butt up man, it's pretty amazing, I love it.

Jessica is in Santa Barbara, California. Hi Jessica, how are you? I'm doing great, thank you and I'm so happy to be able to talk to you. You too. So the situation is we just listed our home for the sale. We listed it for $2.4 million. We had an offer come in within an hour of it being listed for $1.8. Well, that's kind of useless. I know, right? Well, so here's the story. We have a $216,000 mortgage, a $45,000 HELOC, $50,000 solar system, so $311,000 against the house.

Why are you selling the house? We're selling the house. My husband is 73, I'm 61, and it's like money is always an issue. Always just arguing about it, fighting about it. I have a 17-year-old and a 20-year-old. They're always hearing my husband say, I can't afford it. Why does that cause the sale of the house? Because we can't really afford. We're living off of his disability income.

Oh, so you're going to move to a cheaper area? That's what I think we need to do, so you're going to move to a cheaper area. That's what I think we need to do, yeah. We need to... I mean, is that why you're selling the house? We're selling the house because we've been living between British Columbia and Santa Barbara, using the house in Santa Barbara as a rental to supplement the other house and the children's education.

So it's just kind of this mess. It's working, but it's stressful and it's really tight financially. What's your income? What are you guys living on every month? We're living on his disability, which is 4,000 and social security, which is 1,800. And then whatever I can get from the Airbnb which is averaging about $6,000 to $8,000 but it's just dried up. And do you have a nest egg? Do you have retirement?

So, why did you list it at $2.4? Did somebody tell you it's actually worth that or you were just hoping? Yeah, yeah. Well, they said it's worth it. It's listed on Zillow as like $2.3 million. I don't care what Zillow said. Why do you think it's worth $2.4? Do you really think it's worth it. It's listed on Zillow as like 2.29. I don't care what Zillow said. Why do you think it's worth 2.4? Do you really think it's worth that? I didn't necessarily. My husband is a realtor. He did. I mean, he's retired. And another, the person he co-listed with feels it's worth it. It's an expensive area. Okay. But so if it's worth 2.4, then 1.8 is a an insult Right, so we counter it at 2.3 9 9 Okay, just to let them know that we think they're smoking crack. How long has it been on the market?

One day literally five hours got you okay. Okay, so. Okay. So I'll give you a quick nope. If I'm the seller and I'm not desperate and I'm not freaked out and I haven't overpriced the house, if the house is actually worth this, which I can't tell from this conversation if you have any clue to be honest with you, I'm not sure any of you people have a clue in this conversation. Your husband, a former real estate agent who doesn't do anything, you running an Airbnb half-butt and running back and forth between BC and Santa Barbara, oh my God, what a run. And you got a co-listing agent who maybe sold one house last year. So I'm not sure anybody in this whole pile knows what you're doing

in terms of pricing houses. But if you're accurate on your 2.4, then I'm going to counter that at a ridiculous 3.99999 just to let them know that their 1.8 is ridiculous. But it may give you an opportunity to get to the bottom of what the house is actually going to appraise for. In its current condition, regardless of the story, regardless of the history, regardless of your wishes, nothing works there. What's the house really worth? If it's worth 1.8, take their offer and you're done and you move on. And use this as a time to get some cleanliness

back to this chaos that you just described because it sounded very disjointed to us on this end. It didn't sound good at all. It sounded kind of scary. And if you think a million dollars in your pocket is going to solve that, no, that million dollars would be gone in about 32 minutes. Not going to solve it. That puts us out of the Ramsey Show in the books. We'll be back with you before you know it.

In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. you