The Ramsey Show - Get Out of the Cycle of Debt and Choose Peace Instead

Episode Date: December 5, 2024

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Live from the headquarters of Ramsey Solutions, it the Ramsey Show where we help people build wealth do work that they love and create actual amazing relationships. Dr. John Delaney PhD in counseling number one best-selling author and host of the Dr. John Delaney show on the Ramsey Networks he's my co-host today. Open phones here at 888-825-5225. Well it's official now we get to start saying Merry Christmas right? I mean some people start just before Halloween and then others start right after Labor Day but I think we're close enough now we can officially say Merry Christmas. It was the day after Thanksgiving my son and I were going hunting it was 4 a.m. and every channel had Christmas music on it

and I was half asleep and I said I can't take this and he said dad in his half asleepness it's the happiest time of year isn't it? It's too early for Christmas music. The sun's not even up. Todd's in Boston, Mass. Hey Todd, welcome to the Ramsey Show. Hey Dave, thanks for having me. I really appreciate it. Sure. How can we help? So I just learned of you a few days ago. My sister listens to you religiously and told me I should call you regarding my situation. Okay. So earlier this year I went with the debt settlement company to handle much of my debt which primarily student loans and credit cards. Unfortunately just recently I went into default with one of my student loans and that is through Navient which is now Mohella

and what they offered me was something that's outside of my budget and my father is a co-signer on the loan as well and I'm just trying to find out of ways of how I can negotiate Something with Navient to help me make the payments that I can afford Or what are the avenues I can take? So this is a federally insured student loan, right? This is this is a signature student loan They all have signatures. They all have signatures. Is it private? No, it is private. Oh, okay. All right. Good news. Okay. All right. Well, lucky for you, we have actually a sponsor that

refinances defaulted privately held student loans. So they'll buy it from Navient and refinance it and set it up where you can make the payments. You got a pencil? Yeah, one moment. Yeah, go ahead. All right. Y-Refi, the letter Y-R-E-F-Y dot com. And so I'll go ahead and give you the mechanics because they've been advertising with us for

a while. We send people over there. But the mechanics are they buy the loan because it's defaulted at a discount. And then they, so they don't have full face in it. They pay less than that because you know, because you're not paying it, you're not credit worthy, right? So it's not a loan anybody would want to buy that the guy's deadbeaten on it, right? So they're going to buy it at a discount and then that enables them to restructure it and put an interest rate on it that's low and they still end up

making good money on it. But you get the deal of the century. So it's a win-win for everybody. Even Navient, and I really don't care about Navient, I never would I help try to help them win with anything but it turns out they get money on a loan that they thought was bad so they're happy. Y refi buys it at a discount and then you were paying them a reasonable interest rate so they're happy and you get a payment you can afford so you're happy. So that part's taken care of. Now the rest of this, basically what these debt settlement companies have done and do and they did to you is they quit paying

all any of your payments so all of your credit cards are in default right? Most of them yeah. No? They should all be? Did you pay payments to the debt settlement company? I did make payments correct. Yeah. How many? Since May, so I'd say probably close to six or seven payments. They haven't paid any of your credit cards since you signed up with them. Until they work a deal with each credit card company and again they're in default so they're working a bargain with them they put if you weren't in default they put you there correct that's why we tell people not to use this companies because it's actually

does more harm to your credit than even filing chapter 13 bankruptcy so how many credit cards do you have? Right now I have four. And what is the total balance of credit card debt? With all those, just shy of 35 grand. Okay, and what do you make sir? I make per month net pay, I make just over six grand a month. Okay, are you married? I am.

Okay, does she work outside the home? I am. Okay does she work outside the home? She does. What does she make? She probably makes less than what I do I'd say about three grand. Okay so you got like ten grand coming in a month so we ought to be able to clear up 35 pretty quick once we get our crap together agreed? Correct. Okay so yeah this is awesome so what you do quit paying the debt settlement company just just opt out no more money I'm gonna take the Navian so I'm gonna take them to Wi-Refi and I'm gonna take these four credit cards and work on myself now here's what you're gonna have to do

because they're all in default you have to lump some no payments lump some settle each one of them so what I want you to do is I'm gonna put you on a budget, you and your wife working together, you're married, and we have to clean up this freaking mess that we have. We're gonna get the student loans on a payment, we're gonna quit making payments to the debt settlement company, we're gonna live on beans and rice, rice and beans, because the stress of this is overwhelming and it needs to be out of my life. I can't build wealth in the middle of this and I make 10 grand a month. We ought to be able to win, you know? Yeah. Okay. So it sounds like you're with me on this. Good. So now we're going to get you on a budget. We're going to sign you up for financial peace university and show you how to handle money and we'll put you in every dollar. Now here's the way you work the debt

off on the credit cards. Take the smallest one. What is it? Do you know? Yeah, smallest one is just shy of four grand. So you need to put together in your budget $1,000, $1,500 and call the smallest one. Understand that credit card collectors are the dumbest humans on the planet and you can tell they're lying if their mouth is moving They would have a good job if they weren't that's a horrible job. It's a high turnover job So you're gonna be talking to people whose parents are cousins. All right Okay, you got it. I mean you got to understand this because it's warfare. I do it's warfare

No, and so you're gonna try to talk to them and they're gonna blah, blah, blah, blah, blah and you're just gonna have to hang up. And then you gotta go talk to them again. So I'm offering you $1500 as settlement in full. And you keep beating that drum until you get them to take it and say, if you don't take it, I've got other cards, I'm gonna take this money and go to one of the other cards. So you got about five seconds right now four three two are you gonna take it because I'm hanging up and you just gotta have some fun with

this okay it's gonna it's gonna take like 10 15 phone calls per card and you'll settle them for a quarter on the dollar lump sum do here's the two rules remember these two rules. Do not give them any money unless you have the agreed amount in writing. An email is fine. It's gotta be in writing from the credit card company or from the collections agency, whichever it is, that they are accepting $1,500 as settlement in full on this $4,000 debt.

And then, that's rule number one, no money. Not in writing, no money. They lie. The second thing is, no electronic access to your checking account. We'll just take it from your account. They'll take 4,000 out of your account. No, no.

You send them a prepaid debit card that has just that amount only on it. And then you go get a different prepaid debit card for the next one. And you keep them out of your account and you don't deal with different prepaid debit card for the next one and you keep them out of your account and you don't deal with them except in writing and you treat them all like they're crooks because they are. Hope that helps.

This is the Ramsey Show. You want to leave happy memories for your loved ones when you pass away? Not a mess. Your family will be grieving so don't make them spend days trying to access your computer or sift through drawers full of junk. That's why you need a Knockbox. Knockbox is a complete home organization system and estate planning tool that helps you organize all of your accounts, personal history, wills, estate planning documents, and all other info in one place. Inside each kit are 15 categories covering everything from life insurance policies and funeral plans

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PhD in counseling. Lucy's with us. Lucy's in Richmond, Virginia. Hi Lucy, how are you? Good, how are you? Better than I deserve. What's up? I got a real head-screr for you. I was wondering if you could give me advice on a financial decision that I'm trying to make. I'm a single mom of four children and I wonder if I can purchase a home with going through a divorce. Okay, so you're in the process of becoming a single mom with four kids. What do you make hun? I'm an registered nurse. Good. I make like 50 plus dollars an hour But I'm working PRN now since I'm going through Marital issues and so forth.

Yeah, I got you. Anyways... So, obviously you all are separated. Yes. Has the divorce been filed? No. Why? Because I have an appointment next week with the other lawyer because the other lawyer said

it was a conflict of interest to hear my case. So I'm presuming that he has got that lawyer and so I'm going through another lawyer and start all over again. Yep. Okay. Good. Yeah. So no, you should rent until you get this final because if you buy something in the

middle of the divorce, it's going to throw that property into the middle of the divorce discussion Because you're still married Yes, and so you need you need to wait until the divorce is final Okay, all right, so The divorce final within whatever and I have another issue I own two other properties because I have read your book and I paid off my mortgage in five years and what do I do with this property that I live at now? I paid over $150,000. I paid it off in eight years. Is your husband gonna have claim to it? Your ex? You're gonna split the estate?

I'm going to try, because it was my money that went into the estate. And I know that you say marriage, you equally 50-50, but he didn't contribute anything to my financial system. That will depend on Virginia law, and I don't know the law in Virginia, okay? They may you to split it with him. Anyway, I don't know but obviously you're gonna ask for And have receipts improve that he didn't pay on it. You paid on it And so you didn't own it before you were married. Did you?

We bought it like three months after we got married Yeah, okay So it's Mary it's marital property and you'll have to talk to your divorce attorney about that. So what I want you to do is get clear of the divorce and then you'll know what you own and you'll know how much money you've got as a result to put into the next deal. So you can take that house and the other property, sell them, put the pile of money you get from that out of the divorce in a pile, put some other money with it and buy you a house. But you need to be clear

of this so that the same problem you're getting ready to have with this house you don't have with the new one, which is arguing over it. We're not, well it's, that's the head scratcher. I live right beside of his parents. Don't care. Yeah. And I'm ready to get out of it, but I want my money that I put into it. I'll probably never see it. You need to see a lawyer, honey. That's right. And I'll tell you, one of the things that always trips people up when they enter into a divorce is they have an imaginary number that they think they're gonna get. And it's almost never

that number. It's almost never even close to that get. And it's almost never that number. It's almost never even close to that number. And so then people think they're getting screwed. And really they made up a number. So in your head, like you're talking to me and Dave, you bought a house as a married couple. And you might have married a deadbeat who did nothing and he was a joke and a crook and all that.

But the court will say, y'all bought that house together. And so in your head, you might be thinking, I get $150,000 in the sales, and I'm just gonna go buy a house. You may get 65, you may get 75. And if you, I'm just telling you, if you think that other money's yours, you don't know. You don't know until this is done.

So you're gonna cause yourself more angst by imagining what comes next, is what I'm saying. You just don't know until this is done. So you're going to cause yourself more angst by imagining what comes next is what I'm saying. You just don't know until this is done. So the answer to your question is you can either sit right there until the divorce is final and the divorce degree will tell you, the judge will tell you what's happening with the house you're living in and the other property. And then based on that, I'm selling that house. If you, if you've got, if you've got any control over it,

you obviously don't want to be next door to his parents We want to leave and we want to take our cash and go start a life chapter two. That's right on court yeah, and I think the Man if I could tell people one thing when they're going through something hard whether it's a divorce somebody just passed away is slow down I'll do anything for six months Don't we think for for nine months if now if you got get away from mom and dad's house, go rent a place, but don't do anything permanent for six to nine months. After.

But in the middle of it right now, you need to do something. You need to go get an attorney and you need to get this filed and you need to start learning about what law is in your state and your attorney can tell you, there's zero chance you're getting this. Or he or she can advise you. I think we got a real shot at that. They'll tell you what's going on. But you're gonna get new information

that you don't have yet today, and you do not need to buy a house in the middle of this. If you need to move out of that house because of relationship problems now, then just go rent the cheapest thing you can rent until you get the other side of the divorce. Because here's what happens. We get our, in divorce situations, a normal human being will get their emotions woven

into and create this false sense of justice in the math. That's what John's talking about. And it doesn't work that way. A friend of mine that does divorce recovery work and counseling says a divorce turns a marriage into a business transaction. It's all about pluses and minuses. Plus for this asset, minus for this debt. And it's about pluses and minuses and 401ks and what ends up on which side of the balance sheet, the ledger. And then the judge signs off and then the money is dispersed. And you know all the emotions and all the what's right

or what's wrong and the justice and all, it doesn't really come up usually. It's kinda frustrating. So that's the deal. So you gotta walk through it. So please get the other side of this before you buy something. If you've got to move, if you don't have to move, sit there.

But if you've got to move, then go rent something. Rent the cheapest thing you can rent until you get the other side of this. But go get an attorney like yesterday. I've seen this several times Dave where somebody has an imaginary number about what they think they're gonna get and then they do what she's talking about. They go buy a house based on, in a couple of months I'm gonna get $200,000 and then they get a check for 60 or 40 and you're in a you're up a creek right yep so just get after it and the other thing Dave I love that you mentioned this it seems to be a new

trend this is new coming up over the last three or four years it's people getting divorced but not trying to do it just handshaky like we're just separating in we're friends we're just moving on and if you've made a legal binding agreement you have to unbind that agreement. There's state law. That's right. You're screwed. So call an attorney and if you're moving out call an attorney and go through the process and get all the all the T's crossed and the eyes dotted and move on. Shut all accounts down immediately that have both names on it. Yes,

absolutely. So he can't run up debt right now that you end up being responsible for because it's got your name on it. I put a freeze on my credit so that somebody couldn't get in there with my social security number and open up some credit cards. Yep, and all of that.

So, you know, we'll just take that, just the last second here and remind you guys. Okay, so here's the deal. When you sign up for a car loan or a credit card loan, that is a contract you and your husband folks if you're out there you and your wife are on that together if both of you sign up for it's in both names it's a contract that both of you have signed the judge comes in the divorce decree and probate court and says I'm going to give this visa bill to the

husband. Okay? That means that judge has told the husband he has to pay it or he has to face that judge. He does not, that judge does not have the power to undo the contract. So just because he handed the visa bill to the husband and said I want you to pay it, the wife is still on that bill So when he doesn't pay it they sue both of you And you can't go but the but the judge said the judge does not have the power in divorce court to undo contract law They don't have power only bankruptcy court has that power And so no, you know know well the judge said to

give him the house I gave him the house need and pay it now they're suing me right because you believe that crap you're still on the contract so you've got to be completely released from everything by getting it paid off and moved and that kind of stuff in the process that's why this is a business transaction now this is the Ramsey Show. You know I love when I get to talk about this each year during the holidays. As in years past, this December, Xander is donating 25% of all ID Theft Protection sales to Team Rubicon, an amazing veteran-led disaster relief organization

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while helping others in serious need. That's zander.com or 800-356-4282. Dr. John Delaney, Ramsey Personality is my co-host. Elliot is in Canada. Hi Elliot, welcome to the Ramsey Show. Merry Christmas. Merry Christmas. I'm hoping you can help. So earlier this year my wife left me. I've got a daughter who's about 18 months. We are separated, we're not legally divorced. She used to handle all of the money in the house, so I'm just kind of figuring things out for myself now. Make a decent wage, I make about $73,000 a year, but I just I find I don't really have pennies to rub together by the end of the month.

Like I'm not really saving anything, so I'm just wondering if you can help me find maybe ways to optimize that. Good question. Yeah, that would be a normal thing. Left to itself, the savings never occurs naturally. Unless somebody's just like a savings freak. But most people, if you just don't pay attention at the end of the month or really even before the end of the month, the money's gone. And so the only way to make

the money behave is before the month starts, write every dollar down and where it's going to go. And then make it go where you wrote it down to be going. You're in charge of it but you need to tell it what to do because what's happening is in your emotional state because your heart is broken and you're the daddy of a little baby and you're dealing with all this in the middle of all of that you're not even paying attention to the money it just leaves which would be I mean that that's what most people do in your situation, but the answer is you've got to pay attention When you when you're struggling to make payments at the end of the month Is this you having sat down and done the math and realized I don't make enough money to live where I live and do

What I do now that I'm a single dad or are you still sending money to your ex? I mean or are you still sending money to your ex? I mean, what kind of situation are you in? No, there's no money going to my ex. So, I mean, I'm currently paying about 40% of daycare based on how much she makes, how much I make. I put a budget out for myself and it says I have $300 left over the end of the month, but that never seems to happen. I do have, do have like a recurring investment I was like I might as well start putting something away if I can so I was just like I'll do $10 a week it's gonna be something like this won't really notice. I just have that going into investing in stocks and dividend reinvestment and all of that. So what happened was you wrote down a budget and you never

looked at it again till the end of the month. Yeah, you're probably right. And then you went, wow, that didn't work. Yeah. So yeah, I'm going to give you the, I'm going to tell you to do a written game plan, every dollar on paper, on purpose before the month begins, and then before you spend anything out of a certain category, you'd go back and check that category and make sure you still got money left in it. And make sure if you're spending time eating out because you're lonely or you're spending

time doing whatever that costs money because you're lonely, make sure you recognize that and you're writing it down. Because I mean, you're going it down. Right. Because I mean you're going through a heartbreak right now. This is a hard time emotionally and that hard time will show up in the money if you don't get on the other side of it and crack the whip on it. So what you're facing is a very normal reaction in the situation like you're in but that doesn't make it okay. That doesn't make it like, because it doesn't feel right and that's why you called.

Yeah, and David, I don't think you can overstate that. When your world blows up, it's easy to feel like the rules don't apply anymore. Right. But they do. Right. Math does, right? Math keeps going and the kid still needs to eat.

I remember a close friend of ours, her husband left her pregnant with number three. And I remember asking a couple of years later, how'd you make it? And her answer was so instructive, she just said, I had to. And that meant I have to get up and do the next thing, the next right thing every day.

And so the next right thing for him is to begin to put some sort of structure to this chaos. His world blew up, his wife left him and this little one and no one has that in their head even right that happened. Let's get a hold of our money. Let's get a hold of our calendar. Let's start there. And if you can prove yourself over 30 days that I can stick to this thing and say no

then you can do it again 60 days. You can do it again 90 days and then you start asking yourself is this the job is this the apartment is this the house is this the daycare center and go from there. But I guess I don't know, you know a lot more about this than I do that it feels like grieving a broken heart or grieving a loss of some kind somehow gives us permission to let our body go, to let our mind get on junk food, binge watch stupid stuff on Netflix instead of actually feeding our mind something that tightens it up and just let our money go. Yeah I think the difference is I don't think grief is doing nothing. I think

grief is active. If you're actively grieving something, if you're writing letters, if you are choosing your thoughts, if you're doing the next right thing, then that's an action. I think what most people mistake grief for is I'm just gonna turn draw the shades and do nothing. Yeah what I'm saying is when something bad comes at me it's like you said gives you permission. So I don't need to exercise. That's right. I don't need to go to church. I don't I don't need to watch my money because something bad happened to me so now I have permission to sit on my butt. One of my friends who works in the fitness

industry said we often treat diets like you blow your diet and he goes you get a flat tire and Then you just like whatever he said it's like pulling out a knife and going and slashing the other three tires He goes instead of just having one tire off right so your world blows up This is the time to actually stop and really down on that double down on everything else Yes, this is when you need you got to control the things you can control This is the time to actually stop and really down on that double down on everything else. Yes This is when you need to control the things you can control. That's it. And that marriage blowing up is not one of them No, it's it's that's happened. So let's do these other things so that we can deal with the hard hard truth

And what that means is like hardcore Like you were completely energetic and hopped up on caffeine hardcore budgeting I'm going to write this down and I'm gonna pinch it and I'm gonna pinch it some more and I'm gonna... and $300? No! How about a thousand dollars? A thousand bucks, that's right. At the end of every month and I'm gonna start putting that towards something and then I'm gonna work some extra and then I'm gonna lean into these things and that's the way I'm gonna process while I'm going through this rather than

using this as a reason, I was gonna say excuse, but even a reason for taking our foot off the gas and just letting the car go in circles. It's your choose your heart, right? Yeah. You can choose to double down on your budget, I will force myself to exercise even though I don't feel like getting out of bed, and even though it's 44 below in Canada where he is, or I'm gonna choose the heart of just getting to the end of every month and getting further and further underwater Yeah, it's just it's human nature. Just so interesting when we think it through because I

Can't I mean doing this for 35 years? I can tell you that the number of times I talked to someone they go well You know everything was going good, and I went through a divorce Then I went forty thousand dollars in debt and I gained their 40 pounds and it's like well now you got to go clean that up and debt and I gave him 40 pounds. And it's like, well now you got to go clean that up. Yes. So you know what you said is before you do that, go ahead and not do that. Exactly. Exactly. Or find a find an activity, find a Xanax if you will, find a distraction that's not going to be catastrophic. Right. So often I tell folks you get one. So I hear from husbands who come home, they're like, dude, I just want to veg out. A lot of guys will go sit in the bathroom

for an hour and a half and they'll just scroll the phone or they'll disappear. And the pushback is, you need to be present in this house, you need to be around, okay, I need a break. And I always tell them, okay, you get one. You want 30 minutes? She's gonna keep the kids away for 30 minutes, you get 30 minutes after that,

you gotta put that thing down and be present. And so, yes, when your world blows up, it is hard to get out of bed, it is. Okay, so you get 10 minutes. You get 30 minutes to lay here and be sad. And then you gotta get up. You get one, and then you gotta go do your thing. Like whatever that thing is,

you gotta go do the next right move that you know is good for you. So a buddy of mine came to an event that John and I did with Mike Rowe. We're doing it for business guys. And one of the things John did was a talk during that event. And choose your heart. Decide, okay, you're either gonna be overweight

or you're gonna exercise and manage your caloric intake. Both of those are hard. You're either gonna be broke or you're gonna manage your budget and work some extra and sell some stuff and get your butt under control Right choose your heart one of them. They're both hard You might as well choose which one on purpose rather than let it happens to you a friend of mine sitting there He's lost a hundred and fifty pounds. So amazing. I was with him. I was with him Monday night

That's like two George Camels. Yeah, well more two and a half. Yeah Yeah, that's it. That's so amazing. I was with him Monday night. That's like two George Camels. Yeah. Well, more. Two and a half. Yeah. That's so amazing. Choose your heart, right? Choose your heart. And I said, what'd you do? And he goes, stinkin' Deloney talk, man.

Choose my heart. He goes, I've been choosin' to be fat and I decided I wasn't gonna be. That's what he told me. Wow. This is The Ramsay Show. This show is the Ramsey Show. This show is sponsored by BetterHelp. All right. Hey, it's that time of year when it's getting a little colder, it's getting dark earlier. And sometimes we just want to stay inside and get cozy. For me,

the perfect night at home when I'm trying to be cozy is me and my whole family under a bunch of big blankets watching a TV show or reading a book. Whatever your perfect night in looks like, therapy can feel a bit like that. A time when you can settle in, get cozy, replenish your energy and take care of yourself. Therapy is a great way to bring yourself some comfort, especially during the chaos and rush of the holiday season or any other time of year. Taking the time to pause and be mindful is one of the reasons I recommend BetterHelp. BetterHelp is 100% online therapy with licensed therapists. You can talk with your therapist

just about anywhere so it's convenient for your schedule. Just fill out a short online survey to get matched with the therapist and you can switch therapist at any time for no extra cost. Find comfort this December with BetterHelp. Visit BetterHelp.com slash deloney to get 10% off your first month. That's BetterHelp.com slash deloney. Merry Christmas folks. So I don't understand how on Thursday, it's still cyber Monday. I'm confused about all of this. I saw a great, uh, internet thing from Lecrae. He was, it was like, it was like a confession video and I thought, Oh no, man, did he cheat on his wife or something?

It's like, I'm so sorry, but I said, it was, I said it was good. The cyber Monday sale and it's just going to keep going for a while. It's like I'm so sorry, but I said it was I said it was good the cyber Monday sale and It's just gonna keep going for a while Well apparently we're doing the same thing I don't know if we need to turn it into a confession or not But the bad news is that that cyber Monday is not only on Monday The good news is you can still get a bargain on stuff. So there you go So hit Ramsey solutions comm slash store you can get John's questions for humans decks

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check it all out at the continuation of the cyber Monday sale Ramsey solutions dot com slash store it's just to keep it going just keep her going just keep her going Travis is in Grand Rapids hey Travis what's up better than I deserve how can I help so this is my question right now I'm driving to work and it's costing me quite a bit of money because I drive a three-quarter ton pickup truck I'm planning on buying a cheap little gas zipper four-cylinder car my question is when I do buy that car and this truck is totally mechanically sound nothing wrong with it has high miles

do I park at my garage keep it for a spare or do I sell it and invest the money Are you do you have debt? No, I have no debt Okay, how much money do you have in savings? 10,000 how much in your investments? 10,000. Okay, how much in your investments? Well, I just started investing. Good. And only like only like 3,000 right now. I'm only 24 years old. So what do you make? You're only how old? I'm 24 years old. Okay, alright. I make $30 an hour by the way.

Yeah, good for you. Okay, so you're gonna buy a cheap little car because the the the three quarters killing young gas pretty simple, right? Yes, okay um You know it it I love having a truck. I've had a truck most of my life. I drove a truck to work today Okay, so i'm a truck guy. Let's just put that in in the parentheses in the answer here alright however if I were 23 in your situation I would not keep a spare

car as an investment of any kind now later on you know when you're a millionaire and you're 33 because you keep following our stuff and you want to have a spare truck sitting around I'll be your guy because it'll be a small percentage of your world but right now I mean that truck will bring how much money okay five thousand okay if I put five thousand dollars in the middle of the table and you didn't own the truck would you go buy a truck for a spare no the only reason you're keeping it is because you like it right and well if I'm buying a cheap car and if that does go down on me I will have a backup you don't have a backup now you have a $5,000 truck right right yeah yep that does make sense yeah if I were you I'd sell the

truck promising myself that I'm gonna become wealthy and drive whatever the flip I want to drive later because I'm not worried about the gas myself I mean I drove a Raptor R over here the thing drinks gas like I mean you have to stop at every gas station on the way it gets four miles to the gallon it gets four gallon Yeah, it gets four gallons to the mile Yeah But I don't give a rip, you know, that's the difference Yeah, so but I'm in a position but when I was broke, I remember being broken 23

It wasn't 20 minutes ago. It feels like and and so yeah, you don't need that You don't need that extra weight on you and but you just like having you just like the truck I don't blame you for that I tried this when I was broke to have a spare little and I inverted it I had an old truck that I like driving around but I had a little zippy card to get around and it was when it came up for registration oh yeah and I'd come insurer I did the math in insurance and it was costing me about 75 bucks a month that I didn't Have and so this paid for a car that I had in the driveway was costing me money That was my light bill and that's when I was like, I just got it. I got to sell it

Yeah, so that's what I would do. But again, it's not a permanent Decision for the rest of your life It's what you're doing right now at your stage at 23. Later on, get you whatever you want to get when you got some money, dude. Live like no one else. Later you can live and give like no one else. Alan's in Seattle. Hi, Alan. How are you?

I'm doing much better than I deserve, Dave. Good. How can I help? Well, I have done so well. I started doing Dave Ramsey about five years before Dave Ramsey started doing Dave Ramsey. And I discovered you on the radio in the 90s. I said, I'm already doing that, I'm already doing that.

This is great. It was confirmation from what I was already doing. Well, it's good when a couple of geniuses can meet up. Old, old, old geniuses, geez. Careful, that's where that genius stuff comes from. So now I'm 68 years old. I survived about a cancer this year, so I'm a little tighter than I used to be. But I'm doing fine, doing great. My net worth is $5.5 million. I've got about 2.9 of that in stock in the stock market and mutuals. I've got about 200 K in cash and, uh,

I'm moving in a house that's worth one and a half million dollars in Seattle with the Lake view. I mean, it's just, I'm doing better than I ever dreamed. I can't believe it because I didn't, I never spent more money than I made it was just obvious to me you make so much it's been less and you say so so that's where I am now so now that I'm 68 and and getting a little tighter I've been retired for a long long time and I'd spend most of my time doing volunteer work when I do anything.

Anyway, I've got a duplex. It's about an hour and 15 minute drive from here and it's worth between $800K and a million. And it's bringing in about $50K a year. It's increasing in value by about $50K a year. So it's net worth in value is about $100K a year. And I'm just getting tired of managing it because as you know, real estate isn't passive every year something happens one of the tenants moves out we've got to turn it around or we get a water leak or something happens and I told my wife I said I'm tired of managing this thing so what's your question Alan well do I sell the place and get a REIT to just, you know, be done with it or do I get a

professional management company to... Professional management company is not going to make vacancy and repairs go away. No, I know that. Both of those things are still going to be there. If the vacancy and the repairs are what are driving you nuts, those aren't those are gonna leave professional management company will just handle the grief associated with those two things but not the money and So you're gonna give up a little money in order to have someone else deal with the tenant deal with the repairman And those kinds of things and deal with the vacancy, but there is you know, no one cares when it's empty as much as you do So that's up to you. If you want to go that route. That's fine But just get hope you know look for the right thing out of it

It sounds like you're tired of being landlords what it sounded like to me And so I think I am probably getting out of it And I might get into a different kind of a property that doesn't require as much active management something that's a little newer, that kind of a thing. Or like you said, just buy a REIT, drop that million dollars that you're talking about there into a REIT and that's fine. What's a REIT Dave? A Real Estate Investment Trust. It's basically a mutual fund for real estate, is how it functions and so many many many

Allen's out there put money in and they buy a bunch of different properties and the cash flow from those properties and the increase in value of those properties give you your rate of return. And most of the REITs are paying about like a good growth stock mutual fund, about 10 or 12%. A good one is. In the old days when they first started they were fee heavy and they didn't do well. Net. Nowadays they're valid. So you just own a whole bunch of pieces, small pieces of a whole bunch of houses? Just like you

do when you buy a mutual fund you own a whole bunch of pieces of a little bunch of stocks. Bunch of companies, yeah. Bunch of stocks, same thing. That puts us out of the Ramsey Show in the books. the Ramsey Show, host of the Dr. John Delaney show and number one best-selling author. He's my co-host today. Jared is with us in Phoenix. Hi Jared, how are you? Oh I'm doing better than I deserve. Good, what's up? Well my dad passed away a few years ago and he left us a very sizable estate to my brother and I. What is a sizable estate? How much money? My brother and I probably ended up with three to four million each.

That's sizable. Okay. I'll agree with you on that. He taught me to be debt-free at a young age, so I've built up my own retirement up to about $750,000 anyway. So it wasn't that I needed the inheritance, but... You were already a millionaire. I was working on it. Well, you had other savings on top of the $750,000, so you were there. You had a house, probably. Yeah, I had a very blessed life. Yeah, good for you. So the conundrum that I have is that he was married a second time, so I have step siblings and one of the steps had

and one of the steps had mentioned that I should share because he left it to my brother and I and not the other steps. Now the steps are not his kids. Correct. They were his wives from a previous marriage and it was his second marriage and so he became the stepdad. I'm just making sure I got the exact connection. So they have absolutely no blood connection to him whatsoever. Correct. And they're adults. How long were they married? 16 years. Okay. Oh, so they were adults. He didn't raise these kids.

No, he waited till, he said that he didn't want to get married until everybody was out of the house. They dated for a considerable amount of time before that. So they in no way even looked at him as a father figure. Bye Felicia! Well, this step doesn't have a good relationship with her father, and she did kind of look at him for advice and so forth. Yeah, well that's nice.

And he was good to their kids too. I bet he was. To the steps. Okay, so she calls you up and says, I want some money? No, she, it was, I'm having problems, my brother has passed away since then and he was in the middle of a divorce, so I'm having problems with his wife that was divorcing my brother and I mentioned that to her, and during that conversation she got upset because of the numbers involved. And she

started crying and saying, I can't talk with you about this, and I just really, I just don't understand why we can't all just share. And because we're not communist. But what do you say to that? Nothing, nothing. That's not your fault. You don't say anything. Yeah. You say, you know what? I'm so sorry. I'm sorry. You know, I, listen, I, I care about you and I'll be here to emotionally be your step, whatever I am and that kind of stuff. But I understand that this is hurtful to you, but gosh, I'm so sorry. And I just leave it at that. Because it's not about you.

Did you feel bad about this? No, you didn't do anything. What did you do? Why would you feel bad? What did you do? Well, not that I did do something, but that, you know, that I'm in a better situation than she is. And it just, you know, she's making me feel... You didn't harm her in that process. Your father had money and your father decided to leave his money to his two sons. That is a very normal act. Had he left some to the stepchildren, that would have been unusual.

Step adult kids. Yeah. That he never, were never in the house that he lived in. He didn't adopt them, did he? No, they were adults. No, they, their father's still alive. Yeah. Yeah. So now I mean, that's the, this poor girl just got emotional issues on her own. I'm, I can't talk to you. You got too much money that I thought I needed some of. I mean, come on.

That that's her. No, no, I don't feel guilty at all. And I'm not going to be mean about it. I'll be kind to her. And your dad loved her. He'd be gentle with her and you're going gonna be gentle with her, but your dad didn't leave her any money and He was closer to her than you are Now we're pretty close your dad was closer to her than you are he married her mother Well, I appreciate the the the vote of confidence Yeah, that I was doing the right thing. So were the assets of you and your brothers intermingled?

Some of them were. There were just a couple of things, but my brother and I got that worked out. So how are you involved in the divorce then and his death and so forth? Because I'm his trustee. Oh, geez, you're the executor of his will. Well, she sidestepped that and got the... I forget what it's called... when you're the... she became, in lack of terms, the executor

because the will hadn't been put in place. So she's kind of in charge of the estate, but I'm in charge of the trust. Ooh. Because I was the trustee. So yeah, that's a whole nother mess. I bet Thanksgiving dinner's amazing at your house. Yeah, no, not anymore.

This chick's on the out. She was on the out before he died. Yeah, she was. Oh my gosh. Wow. Yeah. Oh my goodness gracious. It's like, I get to make the rules, but I've got the money. But I get to make the rules. No. But I get to make the rules. No, really. You're like, you were almost the ex-wife. You keep that in mind. Yeah, that's what I figured out.

The reason we were going to put an X in front of your name, kiddo. How the Fed uses the road money. Like, we're states. We can do what we want. That's cool. You want roads? Okay, we'll do what you want that's cool you want roads okay we'll do it you see what do you say oh man so hey guys Wow Jared you do whatever you want to do honey but bottom line is it's back to the step sister thing or whatever she is um if you were to give her some money, it's not going to make her okay. She was not okay before, she will be not okay after. Because this is not about the money and it's not about you. So you can't fix her with a check. It's a waste of money. And even, I mean y'all call each other what you want to call each other, that's your family's

business. I don't even know this qualifies as a step-sister. It's not, I mean. It's, it's, it's. Well, I guess it is. It's the child of, it's an adult child of someone your dad married, right? But that's a separate life, it's a separate world. And maybe you're close now and that's wonderful and great and good. But I always like to think back on these situations as if my dad was here and I've got a decision to make what would bring him joy, right? With

this money he loved me. Well and he already decided what he wanted to do with this money. That's right. He made that choice. He was sitting there when he wrote the will. Right. I mean she was on the planet at that point. Yeah. This is not like something that just oh I didn't know. Dad already clearly said what he wanted to have happen. Yes, behavior is a language. He was loud and clear. And he didn't say he was mad at her. He just said she wasn't his. And you don't know what she's already left them. Who knows if she paid for her college

or her kids college. You don't know any of that stuff. She just saw some huge numbers and says I want some of that. Yeah. That's what happened. There you go. This is the Ramsey Show. Hey everybody listen to this. Helix, who makes the best mattresses on planet Earth, actually throughout the universe, they've extended their Cyber Monday savings. They've extended their Cyber Monday savings. Listen, I've spent my whole life sleeping on mattresses, ones that were not great and sleeping on a Helix mattress has transformed my rest. It's made me a better dad, husband, friend, worker. Listen, I'm getting deep levels of refreshing sleep and I say this all the time to

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Hey guys, George Camel here, and it's that time of year again. The store shelves are packed with Little Debbie's Christmas Trees, matching pajamas for you and your dog, you know who you are, and giant inflatable Santas for the yard. I'm not mad about that. And speaking of inflation, Americans are about to spend close to a trillion dollars this Christmas. And get this, one third of that spending will be swiped on credit cards. Yikes. Now I get it, you want the holidays to feel magical and you want to have a good time. But trust me, there is nothing magical about staring down a mountain of credit card debt come January.

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Dr. John Delaney Ramsey personality is my co-host today. So I ran out of time and we ran into the break on the dysfunctional stepsister dad left money to his own boys discussion. And I was actually having a talk with one of our team members before the show, Christian in here, and we're talking about a dysfunctional succession plan that's blown up in the public eye that he's aware of and how do you, he was asking me how do you avoid that. So let's go back to that particular thing and say how do you avoid this okay so there's two broken things in that call one is the stepkids had no knowledge and so once they got once the daughter got knowledge of how much money then her feelings were hurt and her reaction was

I can't even talk right now you you need to give me some of this money, right? Yeah, the other broken thing was his brother who had received three million dollars He and his brother had some of that intertwined. They were able to Untangle that so this brother was standalone But and then his brother starts going through a divorce and instead of making sure he had a completed will through a divorce and instead of making sure he had a completed will, his will was incomplete so now his soon to be ex-wife has stuck her nose into it and is screwing that up. Both of these are poorly handled estate planning. So every one of you need a detailed will, but here's the important part that is left out of the first

One of these things with the stepkids Have a reading of the will or a discussion with the parties that think they might be involved You need to do it in one room or a series of rooms. I don't care have the courage To tell people what it says while you're alive. So if dad who loved this girl's mom and was married to her for 16 years had sat down with this girl and the others and said, hey, I care deeply about you guys, but when we got married we decided that my money was going to go to my kids and so I want you to know ahead of time, it has nothing to do with whether I like you or whether I care about you

But I'm leaving my money to my sons and it's substantial, but that's none of your business Would that be his conversation or that be their mother's conversation? I think it's his okay I think it's his because she's right now who's she angry at him. Yeah Because she felt connected to him and this this cut her yeah it makes me wonder if he gave her fifty thousand bucks and then four million and That's the that's the gas. She didn't say she didn't say he said he said he left everything to my brother No, that's true. So and which I don't even know what happened to the mom, right? How did she not the second wife not get taken care of? I don't know

We didn't get that in the story But the bottom line is tell people This is what's going on. And so I've got a friend whose Kid is doing drugs and he's in his 20s and he sat down with everybody and he said honey. I can't leave you money Not because I'm punishing you but because I'd be buying you drugs. I'll kill you. I'll kill you. You'll use that. Your addiction will be ramped up and you'll have an overdose and die. And I love you and I'm not going to fund something that brings harm to you. And so you're not going to get any money in the current version of the will. And it's not because I don't love you,

it's because I do love you and you're out of the will. And he knows that now. And your brother's the executor and don't you say a word to him. So dad threw his shoulders back, had a backbone and had the discussion with a grown child drug addict while he's alive. So this is not a movie, this is life. It's not like we have the paneled room with the trophy wife and the dysfunctional fault for children Who come in and they are entitled and trust fund babies and the reading of the will and they're all shocked That the one kid who's somewhat normal gets it all this is that's a movie that doesn't happen in the real world Okay, whatever you're doing in the real world tell the people happen in the real world. Okay? Whatever you're doing in the real world, tell the people. That way they don't have to deal with the other people who are pissed off after you die because you were a

coward and didn't tell people what was going on. Yeah, your cowardice... It's an act of cowardice. Your cowardice will blow up the lives of the remaining family members. That's exactly what this is. If dad had had a 10-minute conversation with his grown stepkids and explained to him that he loves them, he loved their mother, but this was my money before I came into this marriage and it's going to my children, you're not my children even though I care about you, then that would have probably handled this whole thing. And if brother had kept up with his own dad gum will and gotten it done and changed everything

over, so you get divorced, change the beneficiary three weeks before on your 401k and your life insurance policies. Don't expect your ex-wife who hates your guts to leave to take a half a million dollar insurance proceeds and just give it to somebody because you forgot to change the beneficiary because you didn't do your job. So you've got to do these documents people. Yes. It drives me nuts. And here's the other side of it.

Here's the other side of it. Um, I just yesterday sent my dad a text message. My dad's in his seventies and I'm going to see him over Christmas. And I said, I want to go out to lunch with you and I just want to listen. I want to hear what your, what your picture is for the next 10 years. Where you and mom wanna live, because I think he's retiring in the next couple years from his professor job.

Where you gonna live? What do you want this to look like? And as a part of that conversation, he, and my dad was a homicide guy, he's been, I've known where that will was since I was six years old, right? But talking through what kind of support are y'all gonna need? What kind of health challenges are y'all facing?

But there are millions of, of, of senior adults that won't have that conversation you're having. But there's also millions of people my age, thirties, forties and fifties. If you don't know, don't just say, well, it wouldn't have the conversation. Then you need to go have the conversation that somebody has to be an adult in this transaction right yeah 78% of Americans die without a will which is insane that's stupid it's asinine if you're 18 years old you need a will it's cruel I don't care if you own anything or not you want the you want the state to decide what

happens to your children have you seen what some of these states are doing with children? You don't want these states in charge of nothing. They're morons. And so you need to be in charge of your kids. And it's a will. And there's zero correlation between making a will and a likelihood you die soon. Right? It's not a thing. Talking about death doesn't...

Might be the opposite. Doesn't occur, probably. The more we discuss my death, the better I we call it the Monty Python meeting where we sit and talk about Dave when Dave dies I'm not dead yet I'm really not dead yet it's just a flesh wound not dead yet I'm feeling better really just a flesh one I've Dave over the last year on my show I think the one of most common questions I get is how do I do X without somebody getting mad? How do I talk about Y without them blowing up our, you can't control that.

So I think we all, as a country, we just gotta have some more conversations. And we gotta do it at our kitchen tables. You don't have to be mean about it. My buddy, he's not mad. He is upset. He's hurt that his kid's doing drugs. But is upset. He's hurt his kids doing drugs I probably pay for rehab, right? He would help him anyway can but he's not going to give him a blank money Yeah in order the same amount of money everybody else he gives him zero

Yeah, so because you know and he said when you clean up, I'll change the wheel if I'm still here If you don't clean up before then you're just out. Yeah So, you know, and it's a good it's a good incentive, but it's not we're not trying to buy something with that. We're just trying to say this is what's going on, so don't be hurt later. There we go. Hey folks, we love talking about money and life and everything else. One of our brands where we help people is a small business brand called Entrez Leadership,

and we coach about 10,000 small businesses around America, showing them how to run a small business brand called Entree Leadership and we coach about 10,000 small businesses around America showing them how to run a small business all the aspects of running a small business and I do a podcast that we've had we've done a podcast for about gosh since podcast started was one of the first podcasts out there the first one we ever did here before we even put Ramsey on a podcast it's called Entree Leadership Podcast and I took it over two years ago and I just take calls from small business guys and gals who call in and go I got this team member that's doing this. I can't get my dad to do the succession plan. I'm having trouble with this marketing idea and so we just talk business during that Entree

Podcast. I do it once a week. If you want to be a caller on that go to entree leadership dot com slash ask or call eight four four nine four four ten seventy eight four four nine four four one oh seven oh so mama bear legal forms dot com has been a sponsor of ours for almost a decade now and that's a quick easy way during the holidays if you have an uncomplicated estate you can knock out a will just for a few dollars and in a few minutes and then just hand it to everybody if you want to. Merry Christmas right I don't know but if you've got a complicated estate you may need to sit down with an estate planner like you got a lot of money or a lot of weird stuff or something that That's fine.

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Alright today's question comes from Jenna in Minnesota. Jenna writes should I help my boyfriend pay off student loan debt? No. I guess we can just end it there but I'll keep going. I know what you're going to say so let me explain. Still no. We both went to college for mechanical engineering. My parents covered my tuition, but my boyfriend has over $125,000 in college loans. We both work good jobs and bring home a combined income of $200,000, but his loan payments are killing him. He didn't want to burden me with them, and he wants to put our life on hold, marriage,

house, and children until they're paid off. He has about $15K in savings, and so this is gonna be a long process. I have 80,000 in savings and roughly 300,000 in stocks that my grandpa set up for me when I was a kid. Should I help pay off my boyfriend's loans by adding an amount to his payment every month, pay them outright, or do you think I shouldn't help him at all?

Should you cave to his blackmail? That's exactly, I was gonna say, he is, this is a, it's a red herring, it's a proxy's a pricey. It's a ploy. Yes. So listen kiddo. We tell folks when they get married everything becomes shared So you will have a hundred twenty five thousand dollar student loan when you're married because your husband does he will have three hundred thousand dollars in stocks That his wife's grandfather left her he will have eighty thousand dollars in stocks that his wife's grandfather left her he will have $80,000 in savings that his wife had before they got married and So when you get home from the honeymoon pay off the pay off the student loan

But this is bull crap Bullcrap on a stick so frustrating yeah Tell boy child time to you know part know, part of the problem is, is we're all playing house over here. So he's got no incentive to get married other than blackmail you into it. So now if you want to have a healthy relationship, y'all get married yesterday since you're playing house. Anyway, we have a combined income. You don't have a combined income. You're not married. That's bull crap. You're shackingacking up and we would not have a show if people like you didn't withdraw $125,000 from the money that their grandparents sent them to pay off a boyfriend's loans and then y'all

break up oh yeah that's like we would standard we wouldn't have this show if that didn't happen all the time I know you can say no not us not us no yes yes yes yes the guy that won't marry me would never do that you know how you sound so serious no don't please don't please don't please don't time to get married boys and girls look I think this is a I think it's a good I think it's a good like an altar call right it's come to Jesus are we are we gonna do this or not yeah cuz if you're gonna get married y'all get y'all come home from the honeymoon we would tell you to take the three hundred eighty thousand dollars that you have in assets and pay off the hundred and twenty five Thousand debt that he has and then we take off with our life with our fabulous combined income and zero debt and

Whatever is left of that money, which would still be two hundred thousand bucks So yeah, and by the way when you get married what you're agreeing to do is to help carry burdens together. For richer, for poorer. And so if he already says, well, I've got this thing going on, so I'm going to hide it from you. I don't want to be with you. I don't want to be apart from you. This will be the rest of your life. This will happen with kids. This will happen with tuition. This will happen with which church to go to. This will happen again and again and again.

This is the big glaring neon sign. This could put our our life on who he doesn't want to burden me with them Put our life on who he's not ready to marry you then. Oh brother. We're gonna work together Work together work together. I'm gonna give this guy about 20 minutes Get me the church on time, baby I'm serious. I'm done with this guy. This is bothering me for some reason. There's something about this that's running all over me, and I'm usually a little bit, I'm pretty mean,

but I'm usually a little bit more gentle than this. But there's something wrong, Jenna. Here's what is getting under my skin. Oh, I know what it is. You have worded all of this, it's all the down-and-gum language. That's what's killing me. You have worded all this because you have bought this freakin sales line That's it. That's the thing. She thinks she's the problem. She thinks she is the problem here. This guy has complete He's a I'm afraid he's a con artist. He's a leech. Yeah So either way if you're good, listen, you either need to leave or you need to get married.

Please don't pay off his loan and don't pay off his loans unless you get married. And if you get married, then it's our loans and our money and we'll do that. But you got, you got about 20 minutes, buddy, about 20 minutes. Stop sales job. Don't like, don't like con artists who are sleeping with the person they're conning. It's a problem. Dad gum salesman. Sorry. I think I've had too much coffee, John. Merry Christmas.

Ho, ho, ho. Oh my gosh, I need to calm down. But yeah, I just, I think about my girls and they did not, thank God, you know, thank God that we taught them how to pick and they picked studs. So I've got two sons-in-law. They're absolutely incredible. Yeah, I've got a young daughter and you would kill him. But here's what here's why. I know I do. Here's why. This young woman, Jenna, is astounding. Yeah, she's a dadgum. She's a mechanical engineer. She makes 100 grand. She's got half a million dollars already put together

because her grandpa hooked her up. And she's got this guy that she loves. And the guy is making further reason. And so she's asking herself every day, what am I doing wrong? Oh, I have another way I can save this thing. I want to help. I know what you're going to say, but I'm different.

No, it's not you. It's him. It's him. You're worth more than this. That's what I'll say. You're more valuable. The dad of a daughter. We're angry for you.

Can I? Yeah. So brought to you by why refi and preparation H because I got hemorrhoids now. God makes me so mad when guys are idiots. Patrick's in Orlando. Hey, Patrick, what's up? Hey guys. Um, so the situation is we're, uh,

my wife and I are 67 and we've got 2.8 million and four different mutual funds. Thank you. Thank you. We're debt free and we got an offer we couldn't refuse on our business. We closed December 11th. We get $575 cash and we hold a note for five years for $300. So that brings me to the question because I've got a daughter that lives in Austin, Texas and she and her husband have been married for 20 years and we have a beautiful grandchild and they're saving for a house. They're also debt free. They're doing everything right. They're both teachers and they want to get a house and they're saving like crazy. Um, two rounds of IVF to get Julia here, uh,

pretty much wiped out their savings and, uh, they're trying to come back for that. And I'm thinking, you know, December 11th, I collect 5 75. I could probably, you know, give them the money for a pretty nice house in Austin. You've got 5 75. And, uh. So that's one option. Option two would be to do a really strong, just do it. I like it. Can I add one thing to it? Yeah.

Okay. I do want this to be a gift, and I'll teach you a technical thing you need to do, but aside from that, I do want it to be a gift without strings, sort of. But I would sit down in person with them, you and your wife, go to dinner and make this a big deal. This is not just a drive by breakfast one morning coffee. Okay? We're going to a nice restaurant, we're going to make a production out of this and say, this has nothing to do with the grandkid. Although you've said it six

times that it does but it doesn't okay it shouldn't it shouldn't because you shouldn't give it to them because the grandkid you should give it to them because they have been responsible and you're not bringing harm to them and you're not enabling bad behavior instead you're accentuating and lifting the positive thing that they have been doing with their life and it's going to It's gonna change your family tree the rest of the way So yes, you should do it and I would say I'm gonna give this to you with no strings attached I will tell you I have a

favorite ask That you promise to never borrow money again Love it yeah, and I wouldn't I wouldn't make though. It's not a contract, but I would just say I'm doing this to change my family tree. But if you go screw that up by borrowing money, it's going to break my heart. And I would do it. Yeah. Now, oh, unified estate tax credit.

Talk to your tax guy. You need to use up some of your estate tax exemption so you don't have gift tax. Don't do this without tax advice. Go get some tax advice, please. This is The Ramsey Show. Hey, George Campbell here. So you're thinking about buying or selling your home. It's exciting, but there's a lot to think about,

and all those decisions can feel overwhelming. Well, here's the good news. You don't have to tackle the process alone. Ramsey's Real Estate Home Base is the place to find all of your free tools and resources for help to get prepared to buy or sell your home with confidence. You'll find calculators, start to finish guides, a podcast and even an in depth video course hosted by yours truly. What's

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So it's just a cyber thing. Cyber forever. It's a cyber. Cyber's forever. That's what we cyber thing. Cyber forever. It's a cyber, cyber's forever. That's where it's at, yeah. And apparently we lied to you when we told you it was only on Cyber Monday, and we're gonna continue to lie to you

until we choose not to. So that's the bad news. The good news is the store has everything on sale. Cyber Monday. Cyber Monday, here we go. So yeah, Breaking Free from Brokes on sale for $12. The number one bestseller by George Campbell. Building a Non-Axious Life, the number one bestseller by Dr. John Delaney on sale for

$12, Baby Steps Millionaires, Total Money Makeover, Get Clear Assessment, audio books are $8 by the way. Just check it out, ramsysolutions.com slash store until we decide Cyber Monday is over. And when we decide it's over, you will have missed out. But you don't know when that's going gonna be because I don't know when that's gonna be so there we go this is the Ramsey show Madeline's in Atlanta hi Madeline welcome to the Ramsey show thank you for having me sure what's up so me and my fiance just really stressed Our debt to income ratio is horrible.

So we just wanted to know what steps we need to take to go in the right direction to get out of debt. When are you getting married? We haven't planned a date yet. Then there's not a we. Right, okay. There's not legally, morally, ethically, monetarily, we aren't in existence until we are married.

And I'm not just making a statement. You, you literally have absolutely no rights to the other person's income, legally speaking. Okay. So, uh, you can act like you're playing house, you can act like you're married and it doesn't change the law. The law says that your debt is your debt, okay? Now when you're married that's different. So I would suggest if you're gonna be a wee that you make it a wee and you run down the courthouse this weekend and get married. Yes sir. Okay. How long you all been engaged or dating? About three years. Time to paint or get off the ladder kid. What do you mean? I mean get married. Okay. We've

been almost in a long time. Yes sir. So, how old are you? I'm 24. Okay, cool. So, what do you make and what does he make? So, I make annually 38k. What does he make? And him annually, okay, I don't have it totaled, but 2640 monthly. Okay he makes about the same you do then.

Okay. Yeah. And how much debt do you have? So my debt, about, so really I only have the home loan and the... You bought a house together. You bought a house? Yes sir, we bought a house. Is it your house or do you buy it together?

I'm the only one that's on a lease. Oh it's a lease? Yeah, so I'm financing mortgage loan. Honey, that's not a lease. Oh man. Did you buy a house or are you a tenant? I bought a home. It's a mortgage.

In your name. You have a mortgage. There's no lease does not enter into it. Yeah, 243,000. Okay. And and so you have a mortgage. You bought a $240,000 house and you make thirty five thousand dollars a year And you're 24 years old She's on the promise that he was gonna help her pay, but they're not married and he's not on the loan

Correct. Yeah, this is what I've been talking about before I started talking. Okay now the alright so Let me fat what debt does he have? He has in total, including his auto loan, $28,330. Okay. So here's what I would tell you guys to do. And you're, I don't know if you're going to do it. I can't tell from talking to you. You actually do it. You sound terrified. I don't know if you're nervous do it. I can't tell from talking to you.

Will you actually do it? You sound terrified. I kinda don't think, I don't know if you're nervous on the radio or if you're just gonna go do whatever you wanna do. Anyway, the, I, if you were my daughter, I would take you two knuckleheads to breakfast and bump your heads together and say,

you knuckleheads go get married this week because you're very, do you understand how vulnerable you are this guy walks off you're screwed girl you understand you can't pay this house payment okay can you they qualified you for it but you can't you can't afford this house if he gets up and leaves right? Right, okay. Now. I'm assuming your is your relationship good It is okay Then I would say let's quit acting like we're married and going to get married because it's very very important that you all do combine Everything and then what we've got is we've got a home mortgage with an $80,000 household income approximately and

We've got a home mortgage with an eighty thousand dollar household income approximately and he's got some Consumer debt that we need to get paid off as quick as we can and we'll walk you right through the baby steps at that point You cut up your credit cards. We'll get his car loan paid off and We take all the overtime we can we quit eating out We don't go on vacation and we clean up this mess and where you have $20,000 cash in the bank for an emergency fund and no payments But a house payment and a combined income of 80,000. You'd be in pretty good shape, right? I can get you there in about a year. If you're married,

I can't get you there while y'all keep sorta doing this because it won't work because because this, the doing things in the wrong order has left our precious Madeline here unbelievably vulnerable. You will be the victim if this thing goes sideways, not him. You'll be the one that's in a mess if this thing goes sideways, not him. And you're worth more than this. And so somehow you talked yourself into

or you got talked into or you guys together sat down and had a combined lack of brains and decided this was the right way to go and it wasn't because it's left you, my daughter, in a real mess, potentially. Let's say he's not gonna break up with her, but they cut his hours. They, he quits his job or he decides I want to go to

NBA and he just quit like it's so exposed. I mean she doesn't have it's all on her. That's what I mean like he's got a free ride now he got someone else to buy a house that he lives in and he gets to pay rent. Maybe. Maybe yeah. Yeah so this is why these numbers don't work, okay? All right guys. There's a couple of issues I we got to stop for a second because we've got just a moment here number one will remind you that if you want to catch The next segment of the show the third segment of the podcast is always on the Ramsey Network app And it's completely free go download that for free so the numbers

If you do just a couple of things in the right order, there's less than a 3% chance you'll be at the poverty level. And the right order is before you do anything with your with building a family, you graduate from school, high school. You do not live together before married. If you don't live together before married and don't have children before married, so you do it in the order, it's called the order, the poverty order. So you graduate from high school, get married before living together and before having children, you have less than a five percent chance of being at the poverty level. That's the national statistics. Almost all of our poverty occurs when you do those things in the

wrong order. And you're a 17 year old with a baby and he takes off because we got pregnant before marriage and so on and so on and so on and I'm not picking on anybody I'm just saying if I could sit down with a 14 year old and say hey you have less than a 5% chance of poverty level if you'll just do these three or four things in the right order you set yourself up for prosperity you want to add to this and get it down to almost zero chance? Graduate from a four-year degree in a usable degree field. You want to add further to that?

Do all of that with no debt. If you just do a couple of little things like that, you're down to less than a 1% chance you're going to be at the poverty level You could these are these are controllable variables in your life but instead You just Buy a house with somebody you're not married to This is the Ramsey Show. Hey, you're still here?

What are you doing? You do know that the rest of today's show is playing right now over on the Ramsey Network app, right? All you gotta do to finish the episode is search Ramsey Network in the App Store, Google Play Store, or just click the link in the show notes to download the app for free. Yep, you heard me right, for free. Then right there on the home screen, you can watch the rest of today's show. Ba da bing, ba da boom. All right, I'm getting out of here. Enjoy. We'll see you on the app.