The Ramsey Show - How Can I Rebuild Trust After a Gambling Addiction?

Starting point is 00:00:02 Brought to you by the Every Dollar app. Start budgeting for free today. Normal is broken. Common Sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fair Winds Credit Union Studio, this is The Ramsey Show. I'm Dave Ramsey, your host, Jade Washaw, number one bestselling author, and Ramsey personality is my co-host today. Open phones here at AAA 825-225. The call is free. free and some say the advice is worth exactly what you pay for it. Chris is going to start us off in Chicago. Hey, Chris, how are you?

Starting point is 00:00:45 I'm doing well. Good. What's up? So about 12 years ago, I used gambling as a coping mechanism. And what was a social thing became an addiction. After about 10 years, I realized that, or after two years, I realized the trouble I was in. And I tried to fix it on my own. It didn't go particularly well. My wife discovered my gambling about eight years ago, so two years after that.

Starting point is 00:01:19 And I did do the work. It was a traumatic and absolutely brutal situation for her to be in. Because all the, as you know, my confession took the load off of me, but I just put it squarely on her shoulders. Now, I did the work. I was already in the process of wanting to undo what I had done. I just wasn't at the place where I trusted the Lord to help me save my family. And so I didn't confess it to her. When it finally came out, I did the work. I spent a year and a half. I paid off all the debt I put. A significant sum in a savings account that she only had control over. Therapy every week. GA.

Starting point is 00:02:18 And it got to a point where even my therapist said, you know, I think you're in a good place with a gambling. I don't think you need my therapy for that. But I'm willing to help you with my marriage. And so what has happened is I've regained the trust in the financial aspect of things. and now, you know, I have kind of controlled my money. We have two separate accounts. But what has happened is the damage that was done to the relationship has just put up such a significant wall that the things I now want to do with giving

Starting point is 00:02:58 and just being a steward with grace that God has given me in my finance. are everything on that aspect is completely separate. If I try to bring her into some of that of what I am doing or how I'm investing or saving or giving, her response will be do what you want with your money. And so for the sake of peace in our household, that is not something I'm going to demand of her. So it's been about seven years. You've been dry seven years. Clean.

Starting point is 00:03:39 You've been seven years. Wow. Yes. Okay. Are y'all seeing a marriage counselor? She, we tried it. We've tried it a couple times, and she absolutely doesn't want to have anything to do with it. So I understand that until the Lord softens her heart towards me, that that's not something I can, I can't change her.

Starting point is 00:04:06 So what I'm trying to figure out is without imposing on her and the resistance to any type of reconciliation in our marriage right now, how can I, I'm not sure how to proceed with some of the things that, you know, the only debt we have is our house. Well, it's hard to proceed with a life when you don't have a marriage even where you have a roommate. Oh, absolutely. And it's hard to visualize a future, a unified future when there's not a unified current. And so, you know, and so, I mean, the language that you're using around this is all correct. If what you're really acting out follows the conversation that we've been having with you for the last four minutes. it's all very clear. Are there kids?

Starting point is 00:05:06 Two. How old are they? Two young boys. I'll say preteen. Can not nail me down quite as. And you can answer as honestly as you can. Is she only staying with you because of them? No.

Starting point is 00:05:21 The reason I think she's staying with me is then right now I am the bad guy. But if she chose to divorce me, there would be some accountability for. from her family and things like that that she would have to deal with. So my point is she's not staying with you out of love for you. She's staying with you for some ulterior reason. Okay, that's the point. Obviously, you're correct. You can't make someone change.

Starting point is 00:05:50 And obviously, you're correct. She has a reason to be pissed. But at some point, it becomes more about her being pissed than it does the actual thing that happened. Right. So, like, we went bankrupt. I was 28 years old. We had little babies, and we lost everything because 100% of the real estate decisions were being made by me. I wasn't hiding anything. It wasn't an addiction. But my wife lost confidence in my judgment with good reason. Hello, I was stupid. Okay. So she lost, you know, and so how do you regain that trust? Well, steadiness, consistency. And, working at, okay, you know, anytime I walk near anything that makes her feel like, the phrase she is, it feels like you're scheming and scamming again. And I wasn't scheming or scamming,

Starting point is 00:06:42 but it makes her feel like I'm, my risk meter is gone again and she has a large risk meter. So we have to really work together to make decisions in order for her, in order for our decisions to stay in her comfort zone, especially in the early days. Today, completely different. It's 30 years ago. but seven years there should be some progress on coming back to the table unless you've given a reason for there not to be and what you're saying is it hasn't been steadily and consistently moved away from all the problems and so to invite her into all decisions and then and she refuses and I want you to look at this with me so you have a comfort so you you know you don't ever think I'm going back to where I was before.

Starting point is 00:07:29 I understand the deception. I understand the actual loss of the money. And, you know, but at some point, we've got to grow back together on this. Otherwise, we've got real issues here. And so I don't know. That's something for a therapist to guide you and how much pressure you put on her to do that. But the bottom line is, Chris, this is not good for her. Right.

Starting point is 00:07:53 She's got a bucket of acid in her guts. and it's just boiling all the time. And that's what lack of forgiveness does. Now, she should not trust you except to the extent you are trust worthy. Worthy. Yeah. But if you're sharing everything and she's got insight into all of it, and we make, Sharon and I make the decisions together ever since that event.

Starting point is 00:08:16 Dave doesn't make any decisions to come home and say, look what I did. We make the decisions together. And if you're doing all of that and she's unwilling to join that, then that's the healing on her part that has an. taking place. And I don't know how to force someone to do that or force a discussion about it. I would turn that over to your therapist, sir. I'm so sorry you guys have been through this. Scambling thing, folks, is out of control out there. Draft Kings is not cute. If you're looking for a more budget-friendly way to save on medical costs and stay true to your

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Starting point is 00:09:47 And right now, CHM's offering new members a 50% credit towards their first month of membership. Get started at CHMinistries.org slash budget and use promo code Ramsey. That's CHministries.org slash budget and promo code Ramsey. Well, tax season is here. Time to get free checklist from us and guides that'll help you file. And we'll hope you get through the mess. Go to ramsysolutions.com slash taxes. Brandon is in Mississippi.

Starting point is 00:10:33 Hi, Brandon. How are you? Doing well. Good. What's up? I had a question about helping us parents have. So, 1099 came in late due to the job that she was working.

Starting point is 00:10:53 And she has the money, but not able to pay all of it right now. And if they were going to get a loan, it would be for the 25 taxes instead of the 24 taxes, which she was trying to take care of right now. And the question was, I know my parents, they won't try to pay me back. Although they will try to pay me back,

Starting point is 00:11:21 but I won't, you know, request them to pay me back. But I was thinking about getting a loan to try to assist them for the 24 taxes. How much is due for the 24 taxes? 27. 27. What? Thousand. 27,000?

Starting point is 00:11:38 Oh, good. Lord. Okay. Yes. And how much for 25? Yeah, I'm not sure. I'm not sure about the 25. But she was trying to make sure and take care of the 27 now, because that is the most important thing, which is for 24.

Starting point is 00:11:55 What else about their financial history? How much are they earning every month or every year? Do you know? Yeah, so I would say mother probably brings around 1.30. Uh-huh. Father probably right at 90. So there's no reason they shouldn't be paying their taxes. Why is she not setting aside money for 1099 income?

Starting point is 00:12:25 So, yes, she was planning them quarterly. But not enough. Yes, not enough. So what happened, a late 1099 came in. Mm-hmm. And so they have to go back. No, that's not what happened. That would have to be some big.

Starting point is 00:12:41 The 1099 came in and she knew the money had already come in. So the money, the fact that she had this income is not a surprise. That's bull crap. You follow me? You don't get a 1099 for $100,000. you didn't know was coming because you have the $100,000. Okay. So this is what's scaring me is that this is going to go on and on and on and on and on.

Starting point is 00:13:09 We don't know if they've gone to the root of this and fixed it or not. Because 1099s just don't fly in the window without the money having already come a year before. Is this a brand new business or has she been doing this for a while? Ever since she retired. Okay. Which was when? about three, four. Okay, so she's never paid her taxes rights, what we're saying.

Starting point is 00:13:32 Yeah, I think this is compiling. Yeah, she had. So 23, it's five, 23 from there, it's all fine. It was just that lived to 24. That's where it started to begin. Well, but 25, you don't know what it is. No, I don't. Tell me about your financial situation.

Starting point is 00:13:52 I'm in debt myself. Okay. That's all I needed to know. Okay, so, and you said you were going to borrow the money. So the answer to your question is no, you don't borrow the money, but let's help them anyway. Let's figure out how we can help them, and you can go back to them with some advice. But you borrowing money for these people that make $210,000 and are out of control is a really bad idea. So no, I would not do that.

Starting point is 00:14:13 Not in a million years. Now, should they borrow the money? You mentioned that she had the money, but she can't get to it. What's that mean? So other scenarios and situations, came up. That money that was set aside for those taxes had to be used for something else. Well, that's pretty vague. What? Well, I would say things that came up due to housing, things that they need to fix around the

Starting point is 00:14:45 house, that's pretty much all the information I kind of got. So, can pretty all the information. But she doesn't have the money, like in some account, she just doesn't want to touch. she spent the money to fix her kitchen or whatever, right? Right. No, it's not that. Okay. So, they have no money. Is that what you're telling me? Yes.

Starting point is 00:15:11 Do they have anything they could sell? Do they have vehicles with payments or no payments? Is there anything they could sell to get this money? I would say both vehicles have a payment. nothing in my mind I just come off the top of head they could say it they could sell okay if I were to sit down with them and I was their coach Brandon here's what I would tell them okay I would say you make $210,000 and you're completely out of control we've got to get your taxes set up and you that those tax accounts are once you set those money aside out of your 1099 income for your quarterly estimates which you mentioned it sounds like somebody knows what to do, then that money is sacred. You do not touch it. And I don't care what comes up. It's already spent. You don't have it anymore. You just have it in your name. You have to forget you own that money. And so nothing can come up. Your little brother needs a

Starting point is 00:16:15 car. Toughies. Nothing can come up. Some friend calls and wants a medical bill paid. Nothing. You don't own this money anymore. It's already tax money. You have to be. You have to quit even leaving it available emotionally. This is me talking to your parents, okay? So that this never ever, ever, ever comes back again. And then we need to work you out of debt with a budget, put you on every dollar, and you guys are going to start living on way less than you make because you got a couple of stupid car payments and you owe the KGB, I mean the IRS, 27,000 freaking dollars. And so we're going to put you on a payment plan with the IRS and they are the first debt you're going to pay off,

Starting point is 00:16:56 and you're going to pay them off in less than 12 months. You make $210,000. You ought to be able to pay $30,000 off very, very quickly. And just pay the IRS. That's what I would do. Would I go borrow money to pay the IRS? No, I would not. Not in this situation.

Starting point is 00:17:13 Because I want to make sure that at the core of this, at the root that caused this problem, that it goes away. And you borrowing money to go get them out of this, when they make this kind of money and are this disorganized and chaotic is really suicidal for you, sir. Please do not do this. Yeah. How long have you been listening to our show? Wow.

Starting point is 00:17:34 I actually learned from them that told me about you guys. Okay. So that means you both should have some sense beyond this, right? And I want you to get serious about this. If you've been listening to the show, you know the things that we're teaching around here. So I want to make sure that today, if we give you every dollar, will you go on there? And will you start getting into the classes and every dollar and let it teach you what to do next? Oh, yeah.

Starting point is 00:17:59 I already have every dollar. Okay. We're going to give it to you for your mom and dad. Let's see if we can get them moving along. But no, you don't, you knew before you called in here, I wouldn't going to tell you, we weren't going to tell you to borrow money. This is like. And we certainly weren't going to borrow money for this. This is like that scripture where the man looks in the mirror and he walks away and immediately

Starting point is 00:18:16 forgets what he looks like. If you listen to this stuff every day, it's up to you to put it into, perhaps, practice. It doesn't happen by osmosis. It doesn't happen automatically. You have to then go away and do the things that we teach. Otherwise, your life is not going to change. Yeah. Including when I went broke, Larry Burkett used to say that personal financial problems are not the problem. They're the symptom of something else going on. So in this case, you don't have a tax problem. You have an accounting problem because you didn't set the money aside to pay your taxes. And then when you did, you went and did something stupid with it instead of paying your taxes. And so now you got yourself

Starting point is 00:18:52 between you and the government, which is a really horrible place to be for anybody. None of us want to be there. Certainly not. These are not people with a sense of humor. These are not people that are powerless. They have lots of power to screw you over, and they will. So you need to get on a payment plan with them and get them paid off and never, ever, ever, ever, ever, ever touch your tax money for anything ever again. Yeah.

Starting point is 00:19:17 Yes. It's gone. It's already gone. You just moved it in and given it to them yet, but it's already gone. It's just like withholding. It's gone. Yeah. I used to go in there, and every month I'd move the taxes over. I did not play games with that. Oh, you do it every time you'd write a check. Yeah.

Starting point is 00:20:09 Dave, we got a lot of calls on this show where life happens. One day someone's healthy, they're working, providing for their family, and then a curveball hits. You know, we hear it all the time. A car accident, a cancer diagnosis, a heart attack, and suddenly, everything changes. Yeah, and that's why you've always said that having term life insurance, from Zander is essential because it protects your family if the worst happens. Yeah, that's right. You need 10 to 12 times your income in coverage. No gimmicks, no whole life junk, just straightforward term life protection. But there's another piece that people often overlook, and that's long-term disability insurance. Yeah, it's important to understand the difference between them. Life insurance steps in when you die. Disability insurance steps in while you're alive but can't work. So it replaces

Starting point is 00:20:57 is a large part of your income, so the bills still get paid while you get back on your feet. Now, if your employer gives you free disability insurance, great. Take it. If it's discounted there at a better price, take it. But if not, Zander can help you find the right plan. Whether you're single or married, it's not optional. If you're going to be out of work for a while, then you need to make sure the money still showing up. And that's why Zander is our go-to. They make it super simple to get the right coverage at the best price, no pressure, no upselling. I've trusted, Zander and Zander insurance for over 25 years and so is my family. So don't wait.

Starting point is 00:21:33 It's fast. It's easy and it could make all the difference. Go to Zander.com or call 800-356-42-82. Protect yourself, protect your income, protect your family. Martina's in Phoenix. Hey, Martina, what's up? Hi. Hi.

Starting point is 00:22:06 I, two and a half years ago, I bought a car and it's a good car. car to 2018 corolla. Um, but I have a 16.5% interest on it. And over half of my payments go only to interest. Um, I'm actually the co-signer on the car on the car. And my mother is the main signer on the car. And I have had job instability, housing instability over the years. And I'm just not putting my life together.

Starting point is 00:22:39 Um, but currently, I haven't even been able to make my third. car payment. So I also rely on this car as a source of income. So I, what are you, what is your advice on the car? I would look for a different, I would start looking for a different source of income that's not tied to this car. My guess is you're doing some of the, one of the delivery apps. Yeah, I'm actually a lift driver. I had a dead end job. I quit that, but I got a new job that is a really good job, but it just, it doesn't start for a couple more weeks. Yeah. What is, how much are you going to be making at the new good job?

Starting point is 00:23:18 About three to four thousand a year. You mean a month? Or months, I mean, sorry. A month, I am a swim instructor, and I'm contracting with a pool that pays very well for their lesson. Okay. And then what's, what do you owe? What's the total amount owed on this car? It was $16,200, and I originally paid $18,500.

Starting point is 00:23:43 Have you looked to see what it's worth? If you looked on Kelly Blue Book, have you looked to see what it's worth private sale? Yes, it's worth $7,500. Oh, boy, what happened to it? She's been driving over. Oh, yeah, that's true, yeah. Destroyed the car. Okay, well, then your only choice here, I mean, you're going to have to pay it off because it's such a low value,

Starting point is 00:24:03 and you're going to have to work quickly to do it. Is it your only debt? definitely not i've got about 50,000 dollars in student debt and i ended up dropping at a school due to mental health issues and i have about 25 000 20 to 25 000 in personal loans and credit cards and then i haven't on i don't even know how many thousands of dollars in medical debt uh i don't even like you know so you're going to be doing you'll be doing swim lessons at this place how long is it going to take you to build up your lesson pool to make $4,000 a month? Or is there a base pay? Because I make, I'm going to be making about $30 to $40 an hour.

Starting point is 00:24:47 Still my question stands. Are they going to work you 40 hours? That's the plan. But, yeah, that's the problem. It does depend on how many clients they get. They do get a lot of clients. Yeah, I'd be looking really deeply into that, first off, and my, my, homework for you leaving this call is I would have something else lined up that gives me the ability to work because you don't know how many clients they're going to send your way and you don't know how quickly your calendar is going to fill up and you've got to get started on this debt ASAP because here's a thing if you default on another payment it's really going to mess with

Starting point is 00:25:22 your mom I'm sure it already has right yeah I feel bad for my mom and I my mom does try to help when she can but she's already she's a single mom raising my teenage brother with special needs, so she's already strapped a lot. What we've got to start with, let's go back to basics. All right. Okay. Before you do anything else with money, you take care of food, shelter, basic clothing, transportation, and utilities.

Starting point is 00:25:51 Okay. Do you pay rent? I do, and I live in the smallest, cheapest apartment I could find here in Phoenix, and I perfect. So you pay the rent. So you pay the rent. And you go to the grocery store, wait, stop, you pay the rent, you go to the grocery store, you get the car current, before you do anything. All the other debts can wait until you pay rent, get the car current, get food on the table, okay?

Starting point is 00:26:22 Before you do anything, you've got to bail a basic foundation in your life, and that's food, shelter, clothing, transportation, and utilities. Okay. Now, once you're current on the car, then you can decide, let's reach out to the student loan people, let them know you need a hardship deferral, and send them some of the paperwork on some of the mental illness issues you've had, and just to let the bureaucrats have something to chew on for a little while while they wait around. You do nothing. You quit paying them for right now. And then you get this book of business at the swim lessons full as fast as you can, and Jade's right. in the meantime and even after, I want you to work all the time. Because what you need to fix your whole life right now is $16,000.

Starting point is 00:27:09 Yeah. If you had $16,000 and this car payment was gone, we could really get after some of those other debts, couldn't we? Yeah, it feels like that car loan is a big wall between me and basically the rest of my life. Agreed. So we need to go find an extra $2,000. thousand dollars a month for eight months and smack this thing in the head okay but that's means like all you do is work girl you just work all in it and it's not over freaking uber's making the car worse okay you're putting so many miles on you've destroyed the value of the car so

Starting point is 00:27:48 yeah but if they if you could if you can work 80 hours a week with swim lessons just put your fins on and go right yeah i mean if you can't get if you can't get a bunch of hours down there, then let's find something else that you can do. That's the thing where you make the most possible money that's moral and legal. Okay? And I want you to go cray cray for a while. Because the way you bust this is you throw dynamite in the middle of it, and the dynamite is dollar bills. Okay.

Starting point is 00:28:22 I like that. And you just say food, shelter, lights and water, and pay off the stinking car. and that's all I am breathing to do right now. I breathe in and out every morning. I'm tired because I work all the time, but by God, I'm making progress for the first time in five years. Yes.

Starting point is 00:28:45 You can do this. You can do it. What was the nature of your mental illness stuff? I have a level one high functioning autism, and that has made it hard for me to hold a regular full-time job. And then I also have, because of that stems. So like some anxiety and depression.

Starting point is 00:29:04 Yeah. I have over the last few months gotten on the rate that's got into the stable housing and finally I'm starting to get my finances stable. I'm trying to do baby stuff one right now. Well, here's the thing. Here's what I've worked with them. In 35 years of doing this, I've worked with a whole bunch of people that both had high-level functioning autism

Starting point is 00:29:22 and I've worked with a whole bunch of people that had depression. And the thing I know is the depression is made worse when you feel trapped. and when you're not in action mode. When you get in action mode and get in warrior mode and get in attack mode, it helps because it releases the dopamine and other things and it helps to melt away the depression. And the high-functioning autism can actually work in your favor in those situations because you have the ability to do extreme amounts of focus, don't you? Yeah, I am really good at teaching people to swim.

Starting point is 00:29:58 and actually the gym I'm working at is called Ability 3CC, and it's actually an adaptive gym, and most of their employees have some kind of disability. Okay. And anything you can do to help people work out, if you can deal on a personal trainer thing going like that. I was going to say you need to go to the school system. What we're going to do is use all of this situation to your advantage,

Starting point is 00:30:16 to the thing that has been a blocker for you, because as you start melting away these debts, first and foremost, you get this car off your back, off your mother's back, your brain is going to clear up. The fog that you've been walking in, the stress-related anxiety of feeling trapped in 16% and feeling honestly shame about signing up for 16% too. That was dumb. So you're not dumb, but that was dumb.

Starting point is 00:30:43 So, you know, what you do is you get in an attack mode warrior girl. You put on your warrior stuff and you get after it. Complete focus. I don't want you to pay anybody else. Just let them all go bad. I don't really give a crap about your credit. You already don't have credit. We know that because you have a 16.

Starting point is 00:30:58 80% car payment. So we know your credits trash already. So I'm not worried about that at all. I'm worried about you. I want you to be free. So you hang on and we'll get you signed up for every dollar. And that'll help you walk through this stuff as well. Murphy's Law means if something can go wrong, it will.

Starting point is 00:31:53 And it usually happens when you're not prepared. That's why a big part of what I teach is staying prepared for whatever curveballs life throws. Have a fully funded emergency fund, buy term life insurance, and get a will from Mama Bear legal forms, because the last thing your family needs is trying to figure out what you wanted after you're already gone. I've seen families torn apart because no one wrote things down. A will spells out exactly what you want to happen after you've passed away. No questions, no court dates, no family fights, just clear directions and peace. It's one of the most loving things you can do.

Starting point is 00:32:34 And on mama bearlegalforms.com, completing your will is fast, easy, and affordable. Peace of mind for your family takes about 20 minutes with Mama Bear. And unlike a lot of other online will companies, the price you see at the beginning is the price you pay at MamaBearlegalforms.com. Go to Mama Bearlegalforms.com and use the promo code Ramsey to save 20%. Mama Bear Legal Forms.com, promo code Ramsey. Richel is with us in Reno, Nevada. Hey, Richel, how are you? I'm well, thank you.

Starting point is 00:33:28 How are you? Better than I deserve. What's up? Hey, so, okay, my husband and I are in Baby Step 2, and I feel like we've kind of tripped ourselves up because we don't know. He gets paid weekly, and we're trying to decide if we should do snowball, like, weekly,

Starting point is 00:33:47 or wait until the end of the month to pay off like a lump sum. So when you go through and you do the paycheck planner on every dollar, do you know for sure at the end of the week that you can pay the money off and it won't come back to bite you in the butt later? We have done it. We have about $400. So we have about $400 like extra at the end of the week to have in order to have all of our bills paid at the end of the month.

Starting point is 00:34:19 Yeah. I mean, I don't have a problem with that. That's the way Sam and I used to do it, but we got paid weekly. And so it just made it easier. And I made a schedule of making sure everything was covered, everything was good to go. And then, yeah, that freed us up to be able to do it that way. So I don't have a problem with that. I think that's great.

Starting point is 00:34:36 Okay, because it just feels like we're not getting anywhere right now because, and I think we're motivated by that, like, a role. we paid this or we paid this. Yes. And it feels like we're not getting anywhere. And I have one more question. We are getting anywhere. It's just a whole bunch of it at the end of the month, right?

Starting point is 00:34:54 Yes. Yes. You're just trying to create. First two weeks you just buy groceries. Grocers, yes. Yeah, and rent and whatever. You're just trying to build in some momentum so that you feel like something's happening every week to keep you going.

Starting point is 00:35:08 Am I right? Correct. If there's any of the stuff you're paying in that first segment, look at your paycheck. Are you using paycheck planner on every dollar? We are. Okay. If you look at that paycheck planner and say,

Starting point is 00:35:20 I could roll this item from the first segment to the second segment and use some of that first segment money to get out of debt, and that would keep me that momentum. And so if there's a bill that you're paying in the first set that can wait until the second set without being late or getting late fees or ding in your credit or something like that, anything you could push off into that other segment, use that money in the first segment for debt, right?

Starting point is 00:35:43 Yeah, because right now she's... doing, you're doing 400 extra a week, right? No, just in the first segment. That's what we have. Wait a minute. I'm sorry. Are you doing this weekly or bi-weekly? We were trying to do it weekly.

Starting point is 00:35:57 So you get paid weekly? I think she gets paid, we get paid weekly, yes. Good. Okay. So each week, figure out anything that doesn't have to be in that week that could be in the next week to allow you to pay more debt in that week, that will give you that emotional being that each time we're paying some necessities and we're paying some debt. We're paying some necessities.

Starting point is 00:36:20 We're paying some debt. That'll give you that sense of momentum. But the math is basically the same. If you said, okay, the first two weeks we're paying only necessities, no debt, and the last two weeks we're paying all debt, it's the same math, basically. But the problem is just the emotion of it, right? Yes. Yeah.

Starting point is 00:36:40 And you are working at smallest to largest, right? We are. And what is your smallest debt currently? Smallest debt currently is 735. Oh, good. That should be done up in the month. What's your household income? We bring home $7,600 a month.

Starting point is 00:36:59 And how much are you putting on debt a month? The goal is to put $1,400 a month. Okay, so that one's gone in one month, right? And another one. Yes. Now, you told me, I just want to check that because you told me you had $400 margin at the end of every month. I'm sorry, at the end every week. So where's the other 200?

Starting point is 00:37:20 I want to say it's about 430. Okay. Yeah, so that should be even more going towards the debt. Yeah. So just double check that. I like the idea of doing it weekly. The other thing is you just started, didn't you? We did just start, yeah.

Starting point is 00:37:34 That's okay. Nothing wrong with that. But the way you're describing all of this is what gave me a hint to that fact. What will happen, and Jade can testify to this too, is the longer you do this, the more intense you're going to get because you're going to start to see this stuff melt away and you're going to crunch some other stuff out of there. You're probably going to end up with more margin than just 14 or 1,500. Okay, yes.

Starting point is 00:37:58 As you get further into this and you get used to the rhythm of it and you start to see it work, you're going to say, I'm cutting that and I'm cutting that and I'm cutting that. And you're going to work extra and I'm cutting that. Yeah. And if you don't have side hustles, you need to lock those in today because all of that, all of that is going to go towards this and all of that. that is going to give you that momentum that you want to feel. Bobby's in Nashville.

Starting point is 00:38:18 Hey, Bobby, what's up? Hey, guys. Thanks for taking my call. Sure. How can we help? Absolutely. So I am, you know, started to make some decent money. My wife and I are about $80,000 in debt.

Starting point is 00:38:34 And it feels like we're not quite month to month, but we're pretty drained. What's decent money? a month. I make about 150,000. My wife makes about $25,000. Okay, so we have $175,000 income. How much debt have you got? That's right. 80,000. Not counting the house? Not counting the house. Break the 80 down for me. How much of that's cars? I got 22,000 in the car. Okay, only one car debt. Okay. What's the other, what's the other 58,000? So 20,000 in personal loan and the rest of consumer debt credit cards. Okay.

Starting point is 00:39:14 She got 40 in credit cards. That's right. Yeah, okay. What caused that 40,000 in credit card debt? Say that again, I'm sorry? What caused the 40,000 in credit card debt? We moved actually to the Nashville area about five years ago, so there was some of that in moving costs, and there was some medical bills, stuff like that.

Starting point is 00:39:38 Okay. Yeah. And some overspending and stuff like that. 100% agree. Yes, correct. Okay. All right, cool. So it sounds like you recently got a raise. Yes, recently did get a raise. Good. Started a new job. That gives you a wake-up call. Okay, we got to clean this crap up now, right? Absolutely. Okay, good. That's a good place to be. That's a good place to be emotionally. All right. So what we teach is a process called the baby steps. You may have heard of it where we list your debts or we say first get $1,000 set aside.

Starting point is 00:40:12 is list your debts smallest to largest. Live on beans and rice, rice and beans, scorched lifestyle, no going out to eat, no vacations, no whining, work all the time, and pay off the stinking debt as fast as you can. Oh, by the way, y'all need to have a plastic surgery party tonight and cut up those credit cards. Light a candle, have a ceremony, and chop those things up. They're destroying your freaking life. They're half of your debt. Yeah.

Starting point is 00:40:35 And the next time we get ready to buy something, we're going to pay for it. Or we're not buying it. So we also have, you know, I have three kids that are all in their activities. So there's, you know, travel baseball and competitive dance. And we're paying a healthy portion. Well, maybe there is or maybe there isn't. You make $175,000 a year. Can you afford to continue to do that?

Starting point is 00:40:56 You ask you and your wife, ask yourselves, and get this debt paid off. Because, you know, I'm telling you, I'm not putting the family in debt for travel baseball. Yeah, something's going to have. You're going to feel the sacrifice. of this somewhere. I don't know if you can do it or not. You guys got to look at it. But the two of you need to, don't start this conversation with the reason you can't do this.

Starting point is 00:41:21 Because you can do it. It's just a matter who's crying. Right. Yeah. We definitely need to get better about our budget. We have it really tightened that up as well. You don't even have one. You don't have to get better about it.

Starting point is 00:41:35 You're going to have to do one. And then you're going to have to be sacrificial about it. And the more so here's the deal you make 175 if you lived on 95 freaking thousand dollars not counting taxes you'd be debt free in a year Right, but that's gonna require a way different lifestyle than you guys have been living because y'all been buying everything in sight like you're in Congress And nobody in your house has heard the word no in a long time kids you your wife anybody So y'all are gonna start looking at each other and go no because it's stealing your future you make too much money now for this to continue to be the way to do things. Too many people get a raise and the way they celebrate it is a new car payment.

Starting point is 00:42:17 You've got to stop that. This has to be broken. This is the cycle that breaks. So you sit down with your wife tonight and go, okay, time for us to be grownups. And we're going to have to reintroduce the ancient word to our household. The word is new. Period. It's a complete sentence.

Starting point is 00:42:32 Yeah, it is. Everybody, practice it with me. You press your tongue towards the roof of your mouth and make a kissing motion with your lips, it sounds like this, no. It's illegal to say that to any group or person in America today, no, but it's a healthy word. It sets you free. No. If collectors are blowing up your phone every day and you're living in constant fear of the next call, you're not living. You're surviving. You don't need more noise or more stress. You need help you can trust. That's why I recommend Guardian litigation group.

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Starting point is 00:44:06 guardianlit.com slash Ramsey. That's guardian l-it.com slash Ramsey. Attorney advertising. Results may vary and no specific outcomes guaranteed. Welcome back to the Ramsey Show in the Fairer Wins Credit Union Studio, Jade Washaw, Ramsey personality. Number one bestselling author is my co-host today. Nicole is in Detroit. Hi, Nicole. How are you? Hi, Dave. I'm good. How are you? Better than I deserve. Better than we deserve. How can we help? Yeah. So I was calling. So basically my husband has refused to give me financial visibility into his life. He has put his foot down, like, you know, literally like, no, you cannot see anything that I have going on financially. I can tell you about it.

Starting point is 00:45:13 But you can't know anything that's going on. And the reason why it happened is we were in a position to buy a home, and the housing counselor and the lender that we were working with asked about our finances. And I found myself saying, well, I don't know. hold on let me ask my husband and then after our call was done I told my husband I said you know I shouldn't have to say hold on to anyone let me ask my husband right I should know what's going on you know in that part of your life it's like we're roommates it's like you're you're over here how did that go he he said I'm a grown man I do not have to show you anything financially in my life I said, but you're a deacon.

Starting point is 00:46:02 You're a deacon. And you're my husband. I said, we're supposed to be one. That, you saying that makes us not be one. And what he said? Me, showing you, my money has nothing to do with us being one. My husband is a deacon. Yeah, but this is, this is.

Starting point is 00:46:18 So, where are we now? So I moved out. We were in a rental. When we came together eight years ago, it was his house. So I moved in with him. We've been there for eight years. We were trying to work on getting our own house.

Starting point is 00:46:36 And because all this, I mean, it's so bad, Dave. It's so bad. But what else is going on? Because this was explosive. So what else is going on? I have a feeling that it wasn't, this has not been the only issue is what I'm gathering. Yeah, no. So he has a 21-year-old son.

Starting point is 00:46:55 And his son is very disrespectful. he basically it's basically like he runs the house and if I try to say anything to him about his son what his son does if I try to tell him stuff that goes on when he's not around he never believes me so it's just it's just bubbling over yeah how can we help you today huh so I just want to know so we've separated he has filed divorce papers but I haven't signed them yet. I'm trying to talk to him, but he is not talk to a boat. Gotcha. Even a word. That's not a word. Have you suggested some sort of counsel? Have you suggested,

Starting point is 00:47:39 hey, this is really bad. We need to get in counseling. What did he say? Yes. I said that and he said no, because that person is not going to tell me that I have to allow you to see my money. See, here's the thing. And I'm just going to go ahead and say this. This is based off of just what you've told me. So take it with a grand assault. this based on what you're saying there's something going on he doesn't want you to see and maybe it does have to do with his stature or how people view him he doesn't want you to have any parts of what he's doing with his money maybe that's a blessing he's the one that's filed for divorce maybe this is you dodging a bullet i don't know i don't know but this sounds like somebody who doesn't it sounds

Starting point is 00:48:21 like somebody who's got extremely high pride that they cannot be told nor learn anything about a better way to exist in a relationship. That's what you've told me. Yeah. And the weird thing is that all of his finances are now going to get exposed. In the divorce. Right. It's ironic.

Starting point is 00:48:41 The judge is not going to go along with his plan. It's very ironic. 100% of his finances have to be exposed or he's going to have to lie to the court, which will get him put in jail. So you don't lie to the court, not even divorce. court. So, you know, he has to come, he has to show all the stuff to the lawyers, and it has to all come before the judge, and he's going to find out that half of it's yours. That's going to be very weird for him. Yeah. Well, we only been married two years. Yeah, that doesn't matter. Oh, I thought it was eight. So you've been in the house for six. No, they've been together. We've been together eight years, married to. Okay. Yeah. What are you concerned about? Are you concerned that there's debt that your name might be on?

Starting point is 00:49:26 that you don't know about? So actually, so before we separated, I had to find out the hard way that he had a garnishment on my account. And so I had to ask him several times to get it taken care of. He got them to remove it and put it on his bank account, but he was not happy about it. And, you know, so I was just like, for you to be so angry with me and telling me, no, you want to. allow me to see you financially, but you got a garnishment on my on my account. How is that fair? There's probably some shame going on that you don't know about. There's probably a lot here going on that you don't know about. And it's, now, granted, I don't know what parts you've contributed to

Starting point is 00:50:12 whatever messes here. I'm sure there's, is two, you know, two sides to everything. But, um, but my guess is there's some things going on that might be causing him some shame. Or, you know, it might be just the way he views those gender roles that you guys never aligned on that. Money is the man's thing and it's not. Who knows? But it's never going to come out because he won't go to counseling with you. Yeah, it's going to come out in the divorce. You're going to find out everything about his money in the divorce, which is the irony of him filing for divorce because you wanted to find out what was going on with the money. So it's kind of ironic. And he just, he's just dumb enough he doesn't know that. So this is going to be a real surprise to him. It's going to be this

Starting point is 00:50:52 awesome wake-up call for him. Because the judge doesn't really care about, the judge doesn't really care about his theories. He's just going to tell him what to do. And if you don't do it, you're in contempt of court. And it's really nasty. You don't want to screw around with the judge. So this is where he's going.

Starting point is 00:51:07 The question you asked, I have a sad, horrible answer for. What can I say to him to make him want to do this? And the answer is nothing. There's not anything you can say to it. I wish there was one frame. one way of doing it. But this is a very entrenched position that he has taken to the point.

Starting point is 00:51:29 He's willing to give up his marriage over this. And so there's not a single phrase. If he was coming to the table and saying, hey, I want to work on this. Let's go to counseling. I could give you some things to say to do all that. But in this situation, you know, you're just going to be, you know, just throwing water against the wall. There's nothing happening here. So I'm sorry.

Starting point is 00:51:54 I'm sorry that you chose poorly in a husband. This guy's bad news. Too bad, yeah. No one listening that has a daughter would want their daughter to marry this guy, not a person out there. Regardless of how much Nicole contributed or whatever else was going on in the house, all that kind of thing. But this is a guy that is not in a good place and he's not helpful and he's not a good husband. And you're, you know, there's not a single phrase that's going to make him not be a jerk. I don't have that not be a jerk phrase.

Starting point is 00:52:29 I don't have one of those. And I'm sorry. I wish it was. I wish it was something we could just do. But unless he just decides that he wants to be together, unified, work together, in full visibility. And in order to save his marriage and start with a marriage counselor, then you're not going to make. Take it, kiddo. I'm sorry. I wish you were. Hey, let's play a quick game of would you rather.

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Starting point is 00:54:02 Maria is in Arkansas. Hi, Maria. How are you? Hi, thank you guys for taking my call. I'm a little nervous. That's okay. But I guess I'm trying to get advised from my husband and I. We're trying to start building our forever home. and sometimes we're like, yeah, let's go ahead and, you know, get in bed, you know, take a loan now.

Starting point is 00:54:25 And then there's time where you usually be like, well, what if we just cash flow, everything, call it a day? We are debt-free. That's good. We want to have been saving for the past couple of years. Both of us got a raise, a previous raise. So how much have you saved? Right now, it's a little bit over. 180K.

Starting point is 00:54:50 180? A hundred and what? $80,000. $180,000. Wow. And what is the house going to cost? The quote that we got is around between $380 and $390. Okay.

Starting point is 00:55:07 Did you save $180 in two years? Yes. Wow. Excellent. Yes. So, you know, like I said, we try to be a lot of, if it's okay for us to stop investing right now just for a couple of years. Yeah.

Starting point is 00:55:23 Or, you know, to put all that money into cash flow in the house or if it's okay for us to take out a heat log. Did you save $180 while investing? 15 percent? Yes. No, we were not investing 15%. We only investing between 5 and 8%. Okay, okay. I would stop investing completely.

Starting point is 00:55:42 I'm with you, and I would cash flow this thing. And here's the thing you need to remember. it'll take you a year to build it. Correct. So you can start in one year because you need two years worth of savings you'll have the whole amount, right? Yes, that's what we're hoping for you.

Starting point is 00:56:02 If everything works out, the way, you know, we can find it. I would start the house in one year. I'd get all my plans done. Have you got the lot already? Yes. And it's already paid for. Yes, we don't.

Starting point is 00:56:18 Is it paid for? I'm sorry. So yes, it's paid for it. Okay, good. So all we got to do is just cover the bricks and mortar. Do you have your plans done? Yes. You have your builder selected?

Starting point is 00:56:31 Yes. Awesomeness. Okay. Well, what we do, what I've done a couple times, including the building we're sitting in, as a matter of fact, I did not have 100% of the money in the bank when we broke ground, but I knew it would be here by the time I needed it, meaning that if it takes you a year to build and it takes you two years to save the money, then you'd be safe to start building in one year.

Starting point is 00:56:58 Does that make sense to you? Yes, yes, definitely. Yeah. And if you can do this in two years and stop everything and you'll have a paid for $380,000 plus the lot, a $400, $450,000 house. Sweet. How old are you guys? 32 and he's 37

Starting point is 00:57:17 That's amazing What's your incomes? It's 100 and Around 150 How'd you save this money so fast? You guys live on nothing Don't you? Well, we

Starting point is 00:57:30 I think we're pretty good savers I think you're above average Yeah It's very impressive So here's the thing If you moved in two years from today Would you be okay with that? I think I just want to go ahead and get started.

Starting point is 00:57:50 I don't mind getting the loan just because I guess I'm more of the, on the more emotional side. You don't really want a loan. You just want a house. Yes. I guess you can say that. Okay. Well, I mean, what we teach, what we teach is best is paying cash, next best is a house you can pay off in 15 years. in your case you could pay it off in one year

Starting point is 00:58:17 if you started a day and it was finished in one year you would need to borrow one year's worth of savings rate or about $100,000 and you'd pay that off in one year yes my fear is that you'll let your foot off the gas and not

Starting point is 00:58:34 pay it off in one year that's my fear so I would love to talk you into waiting just one extra year which will go pretty fast I mean to me it feels like COVID was like last month and it was five almost six years ago. I agree.

Starting point is 00:58:55 Yeah. And so my point is this thing goes fast. So if you start, you know, I don't know, you guys keep talking about it, but anywhere in there is fine with me. If you want to start now, you're not doing anything stupid. It's not, it's a good, better, best, okay? And what you guys are talking about cash flow and 100% is the best. I love that. There's no hiccups in that.

Starting point is 00:59:21 You know, better than, but, you know, and still in the good range, it was paid it off in one year, which is if you took a loan out today, and you don't need to take out a loan today, you'd need to take out a loan somewhere in the building process because you won't quite have enough to finish it. Correct. But, I mean, you could get started today, put 180 into it. If you slow walk the project. I was going to say any delay. And it takes 18 months.

Starting point is 00:59:46 You'll be there. You can make it. You know, you'll make it out. So just, you know, but just be looking at that and thinking about this. I like the plan of taking dead off the table and we have to push this through because it makes you do a whole bunch of stuff. Keeps you from having scale creep in the kitchen. You know, you select a different dishwasher. You select a different whatever.

Starting point is 01:00:12 And I'll add one other thing to this on the emotions. Okay. You can justify a lot of things emotionally when you say it's my forever house. And I've been doing this for a long time and I grew up with parents in the real estate business. There is no such thing as a forever house. You will not be there forever. Statistically, the chances of you dine in this house are very close to zero. Very close.

Starting point is 01:00:38 So this idea of a forever house, there's only one. It's heaven. That's it. You don't have a forever house here. You're going to move. Stuff's going to happen. things are going to change that you can't see good and bad that are going to give you an opportunity to move up, move out, move somewhere.

Starting point is 01:00:54 And this is a great house and it's a great plan and all of that. But take the pressure off of a forever house because it's like, because then everything has to be perfect. And I've built a bunch of houses that I live in and they're never perfect. It's a never a perfect process. It's a very messy, combative, combustive process. if you put the pressure on it, that it has to be perfect because we're going to be here forever. It's just too much. You can't breathe in that.

Starting point is 01:01:23 Yeah. Plus, you're going to look at it in five years and want things to look a little different anyway. Oh, I don't even want to talk about it. I'm just saying. Sounds like you have a little experience with that. Yeah. Yeah. I mean, I, and I sold, I was actually when I was 22, I was selling houses in a subdivision where we built custom homes.

Starting point is 01:01:45 and the people in there that were the hardest to deal with were the ones that had had uh they thought this was the going to be their last home right or their only home ever and and that puts the pressure on the process to be perfect can't be they're over there every day driving the subs crazy you know let them do their work it's a it's a it's a piece of drywall let them do their job okay good for god's sakes you know and it's just it and it changes their pressure on on how fast we get this done and how much money we take and how much money we spend and all that. So anyway, all that to say, Maria, I think you guys have done an extraordinary job. Way to go.

Starting point is 01:02:25 We're proud of you. And if you start this month and you take on a little debt and you pay it off fast, that's not the dumbest thing in the world. But one step smarter would be to cash flow it. And anywhere in between there, like we start in six months and we go 18 months to build it, oh, now we made it. You know, that kind of thing. Yeah, I think that's what's going to end up happening. anyway. Yeah. Takes a minute. Takes a hot minute to get all this stuff done. But yeah, it's a great, great way to go. And when you're paying cash like this, you're going to watch every dollar in the

Starting point is 01:02:54 budget with the builder, make sure everything's dialed in. And you push all those buttons. It makes a big deal. I don't get that call very often. Oh, I love a call like that. She has options and she has time, which is wonderful. And she's wonderful. And money. Saved it all. They live on nothing. Yeah. Pretty impressive. You've worked too hard to get control of your money just to let strangers control your data. Think about it. Just about every time you sign up for a newsletter, grab a coupon code, or start a free trial, your personal info, like your name, email address, phone number, and more, gets scooped up and sold by data brokers. Here's the deal. Freedom isn't only being debt-free. It's also being free from companies cashing in on your data. And that's where Delete Me comes in. Delete Me's privacy experts. Find your personal info on these shades.

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Starting point is 01:05:41 Go download the every dollar budget app for free. in the app store or Google Play. John is with us. John's in Atlanta. Hi, John. How are you? I'm good. How are you, Dave?

Starting point is 01:05:53 Better than I deserve. What's up? Well, I'm 22 years old. I'm graduating college in May, and I want to buy a car. But I'm not sure if I can afford it. Okay. All right. Well, how much money do you have, and how much do you want to spend on the car?

Starting point is 01:06:09 So, a car is about $13,000, and I have about $11,000 in cash. but I do have some savings, some investments, about 40,000, as well as, you know, 9,000 in a Roth IRA. What do you mind? So I'm going to be graduating in three months, and when I graduate, I'll make about $65,000 a year. Doing what? Going into the wholesale insurance industry. Okay. And you've already secured that job?

Starting point is 01:06:42 Yes. Okay, cool, cool, cool. I mean, if you're going to be making $65, you're under our rule and you're paying cash for it, I don't necessarily have an issue with that. What's going to be your living situation? I'm just going to keep living with my parents and maybe help them pay off the mortgage. Now, that's the part that I have an issue with. Tell me about why you would continue to live there.

Starting point is 01:07:05 I'm assuming you don't have any other debt. Am I wrong? It is because they only live about 30 minutes. from where I'll be working. And I'd rather start saving up money before getting a place to my own. You may have cut out when I asked you about the debt. Do you have any other debt? I have no debt.

Starting point is 01:07:26 You have no debt. You have $40,000 in saving. $65,000 income and a brand new car. Why do you got to live at home? This is your time to strike out. Really? Right after I graduate? Oh, absolutely.

Starting point is 01:07:39 Yes, it's the best time. The most exciting time. You'll hope your dating life, too. Yeah. Oh, wow, I'll bet. Yeah, girls are not as exactly attracted to guys who live in their mother's basement. Wow. It's true, you know.

Starting point is 01:07:59 It's okay to pull money out of my investments, even though about half of it, $20,000 is capital gains. What do you need to pay? Go back, go back. $2,000. Right. Wait, wait, wait, what is the car? you're wanting to buy. So it is a 1999 Mercedes SL 500. No, I would not buy that car. Oh, come on. No. And here's why. The car is absolutely stone cold fabulous. I love the car. The maintenance on that

Starting point is 01:08:33 car for a guy in your situation is absurd. Maintaining that old Mercedes is going to cost you a freaking arm and one of your legs. It's going to destroy you, man. You're going to wish you had never seen that car. Let me tell you, it's serious eye candy, though. I'm with you. It is an absolutely beautiful automobile, and it's a classic. I love what you're looking at.

Starting point is 01:08:57 But, dude, it's going to cost you $5,000, $6,000 a year to keep this stinking thing rolling. Can you tell I've owned a Mercedes or two? Or six or 20? I mean, I've had a bunch of them, and there's a lot. of cost to keep the thing rolling. Get you something that doesn't cost anything to maintain that is going to be just as much fun. And that would be a newer model, similar price range of something that doesn't require constant stinking maintenance.

Starting point is 01:09:30 Okay. That's an old man joke, man, but it's the truth. So we've just told you to do the two things, not to do the two things that you called on here wanting to do, which is buy the Mercedes and live at your parents' house. What are the odds you do either one of them, John? I will. I will. Don't worry.

Starting point is 01:09:50 Okay. Okay. Good. So, yeah, I think if you had a fun car that was very highly reliable and requires almost no maintenance that is $10 to $15,000 and you pay cash for it and you make a 90-day plan to move out for mom and dad after you get started in your job and you're actually making the 65K,000, I think that's a great plan. that's what I would tell my own son to do, okay, by something that doesn't require maintenance. Man, I tell you, that's a great car, though. I don't know anything about the car. I just Googled it to see what it looks like.

Starting point is 01:10:24 Yeah, classic. It was classic. I think it's a beauty. Yeah, classic. It's a good old looking old Mercedes, and it's great, but they just, it doesn't matter. Every time I take the thing to shop, it's just a dead gun, man. It's unbelievable. And so they are not easy to maintain.

Starting point is 01:10:41 Well, they're not cheap to maintain. And the fact that you buy a cheap car, but then you're having a high maintenance bill. Right. If you're going to buy a cheap car and then get something that doesn't have a half to you work on all the time. Yeah. Let's talk about real quick this living at home business because he was the stark opposite of Alvaro, who did his debt free scream on Friday. Okay. So Alvaro graduated from college, similar age, and lived at home, made his parents a deal.

Starting point is 01:11:11 and said, can I live at home debt-free for me to pay off, I think it was $70,000 or $90,000 of student loans. Because he had done the math and said, if I pay interest, if I do this, it's going to take too long. And he said, and after a year, if I'm not working hard enough, you can charge me double rent. And so a year past, they saw he was working very hard.

Starting point is 01:11:29 He ended up paying off all the student loans, did his debt-free scream. Perfect example of saying, I'm going to graduate, I'm going to live at home for a short period of time in order to win. To clean up the mesh. Very clean. What my guy, John wanted to do is pile up cash.

Starting point is 01:11:44 It's pile up cash. And I personally wouldn't do that unless you have debt to pay off, but just to sit at home and just stack up money at such a key point in life when it's time for you to go out and be your own person, I just wouldn't do it. I think it's more detriment than good at that point. It's just my personal opinion. You're trying to look at this only through the lens of money and there's social development, there's career. development. There's confidence. There's everything else involved. So each one of our kids, we love them dearly, and they were more than welcome to stay in our home forever, except it wasn't good for them. Yeah. And so we help them make arrangements within a month or two of graduation to

Starting point is 01:12:29 be on their own. And when you pay your own light bill, you make your own bed, you buy your own milk, now you're an adult. Your mommy's not cleaning your underwear. I'm I mean, it's time, you know? And honestly, you're more attractive to employers because you walk different. You're more attractive to the opposite sex because you walk different. You have the shoulders thrown back a little confidence, a little swagger. Like, I got this thing. Yes, yes.

Starting point is 01:12:57 And I'm, you know, and I'm actually doing it. And there's a confidence that comes from having the dignity of being on your own. And we've got a large percentage of your parents out there who are encouraging your children to not develop into adults because you've got a whole bunch of 26-year-olds living in mommy's basement. And they've all got an opinion about capitalism with your $1,100 Apple phone, which is more than just humorously stupid as well. So it changes everything. It changes everything. When you start, it's on me. There's no bread in the cabinet because I didn't buy bread. It's on me. And it changes everything. I think so.

Starting point is 01:13:39 And we're hurting this generation by not allowing them to do some hard things. Yeah. Yeah. And I mean, no shade on John. Like, he's done a great job. He, you know, came out of college with no debt. He's got money saved. All of those good things.

Starting point is 01:13:55 But that's also understanding you're in a great position to be on your own. It's okay. This is why you do this. This is good. Yeah. I left with $1.12 in my chicken account. So that's how hillbillies do it. I'm just saying.

Starting point is 01:14:06 But, yeah. When I moved out. Get out. When I moved out of my parents' house, I moved into a friend's apartment that already had two roommates. So I had a futon in the living room. Oh. And that's all I had. But I wanted to get out.

Starting point is 01:14:19 I was ready. Hello, net worth. Yeah. When your net worth is a futon. That's all I had. It was not comfortable. 10 out of 10 wouldn't recommend. Today's question of the day is brought to you by Y. Refi.

Starting point is 01:15:20 If defaulted private student loans are wrecking your budget, it's time to deal with them. Y-R-R-E-FI-E-FI helps you refinance defaulted private student loans with a low fixed-rate payment based on your ability to pay so you can stick to the budget, work or plan, get out of debt. Go to Y-R-R-R-E-F-Y. That's the letter Y-R-E-F-Y. Dot com slash Ramsey might not be in all states. All right. Today's question comes from Mason in New Hampshire.

Starting point is 01:15:48 He says, I bought a house about five years ago. My name is on the deed, and my dad co-signed so I could get a lower interest rate. Now my dad is pressuring me to refinance to get his name off the loan. I'm not behind on payments. Am I legally obligated to do this? I don't think I should have to refinance because he made the choice to sign for me. I like this question. Are you legally obligated?

Starting point is 01:16:12 No, you're not legally obligated. My guess is your dad is trying to do something else financially. Maybe he's, I don't know, who knows? Maybe he's trying to buy a house. But he's got a lot of this debt tied to his name. Or maybe he realized. co-signing is really a stupid, stupid act, and he's trying to make that right. I don't know what you guys' conversations have been like, but if I were in your shoes, Mason, my guess is one of two

Starting point is 01:16:38 things is taking place. Number one, if you've looked at refinancing to get his name off and you've realized you cannot afford the loan on your own, that might be something that's keeping you from doing this. And if that's the case, you know... If you paid the bill for five years and you paid it on time, refinancing should not be a problem. It shouldn't be. The cost to refinance. Maybe your dad wants to chip in some of that to get his name off the loan. And so.

Starting point is 01:17:06 My guess is it's an interest rate thing. No, my guess is he just didn't want to fool with it, and he thought this was a forever deal. So here's the bottom line, Mason. What you all did was stupid. He should not have done this because at the moment he was trying to help his kid get a house. but there was no end to the deal in your mind. In his mind, he wants to get off of it now. And you're just like, well, he gets down there forever and screw up his life forever because

Starting point is 01:17:36 he can't buy nothing else as long as his name is on this. It's a liability in his name. So he's going to have trouble getting a mortgage himself is the problem. Or refinancing his mortgage is a problem. Anything like that. He can't do anything. He's stuck. So it's a stupid idea.

Starting point is 01:17:51 And now you guys are tied at the hip. and it's not bothering you at all. So, yeah, yes, you should refinance this on a moral basis, not on a legal basis. If at all possible, I'd figure out a way to refinance it. And if I was your dad and I wanted off this loan, I'd pay the closing costs to get rid of the thing. Yeah. And I help you guys get it done and get the deal done. So here's the thing, folks.

Starting point is 01:18:19 If someone can't afford to buy the property or buy the item without a co-signer, it's going to be a pinch later. The banks, they love to loan money more than they love to breathe. And if they won't loan you money without a co-signer, it's because you're not eligible. Hello. They would love to give you money and rip you off in any possible way they can. And then parents come along go, oh, I'll help you get screwed. You know, that's just dumb.

Starting point is 01:18:52 And dads and moms, you're not a blessing to your child when you do this. this. You're helping them step into a bear trap going, step right here, son. This is how it's done. Well, that's dumb. Okay. Don't do this. Because you get in these situations is what happens. Worse than this situation is where the guy's not paying the bill. We get that one all the time. Exactly. My grandmother, my grandmother, co-signed for my car and it's 42% interest. And now my granny's about to get screwed because I'm going to get repoed. A hundred percent of these deals go bad. Of course it goes bad. So please, please, please do not cosign. It's in the Bible, proverb 1718. One lacking in sense, cosigns for another. It's what the Bible says.

Starting point is 01:19:40 So you're lacking in sense when you do this. I have cosigned back in my earlier days and I got to pay the bill almost every time. One fool co-signed for me and then I went broke and he ended up paying a bill. Oh man. I had to go back and pay him back later. his wife still not happy with me 30 years later because we were fools signing up for a bunch of crap that we thought was going to work out that everybody else knew wasn't going to work out Carson is in Cincinnati hey Carson how are you good hey Dave thanks for taking my call sure what's up okay so my wife and my stepson they live separate from me they're German citizens and they're waiting to get their very

Starting point is 01:20:26 is approved so they can live here with me. But that is expected to take anywhere between one to two years from now. Are they in Germany? They are, yes, sir. Okay. So my question is, how should I be prioritizing my time alone and what debts should I be focusing on to make sure that my family is set up for success when they get here? And how long have you been married? September. Cool. And how'd you meet? I was stationed over there in the Army. Thank you for your service. Thank you.

Starting point is 01:21:05 So if you get married, I don't know how this stuff works. I'm ignorant about it. It takes two years to get a foreign citizen wife on site. Well, if we had gotten married while I was still in the Army, it would have been a lot quicker. But we decided to get married after I got out, and the current administration has been very, fluid with immigration. So that was the update I received was 12 to 24 months. Shoot. Okay.

Starting point is 01:21:35 I'm going to keep getting updates and I'm going to keep learning if I'm you because that's an unacceptable answer as far as I'm concerned. But the, because the current administration has not got a war going with people coming here legally. It's the ones coming here illegally. And so they're not trying to put a block on immigration in general. that's not that's not the spirit of what's happening out there right now I was with some customs guys yesterday so anyway I don't know anything about the law on that or the regulations today but I'm

Starting point is 01:22:07 gonna keep pushing if I'm you answered to your question is we'll get out of debt as fast as you can as much as you can and stack as much cash as you can right right okay so I got the numbers and I'll share them with you okay tell us okay so my net income I receive $5,200 a month for my job. And I receive compensation from the VA for injuries. That is $2,300 a month. On top of the $52. Yes, for a total of $7,500 net per month. Good. Okay. The debts that I have, I have a mortgage for a house that I bought for $153,000. I have 140,000. I have a 140 remaining on the mortgage.

Starting point is 01:22:58 I have $26,000 in home renovations on a loan that I've got, and $13,000 in student loans and $4,300 in credit card debt. Okay, cut up the credit cards. Let's get on a tight budget, pay them off as fast as you can, then pay off the student loan. You ought to be able to do that pretty quick if it's just you. Are you sending money to Germany? I am a portion of my check is going over there to her to support her while we wait.

Starting point is 01:23:30 Does she work? How is she being supported before you got married? So she still works a job right now. She has just moved out of her apartment to her mother's house to get ready for when we do get the green light for the visa to move over here. Does she have any debt or anything that we need to take note of? She has a $6,000 loan on the car remaining. I've offered to pay that off for her, but she has elected not to. She has a sense of duty to pay it off.

Starting point is 01:24:05 She feels it was her loan. She wants to pay it off herself. Well, here's the thing. I know that you guys are living separately, but you are married. So there's really no reason to not attack this together and work on this together. So, I mean, if the $6,000 car loan is the only thing, even if it wasn't, I would still stack this into a debt snowball, and I would still combine you guys' margin together and all of your monies together and whatever the margin you both have together goes at the smallest debt, which in this case still is the credit cards. If she's still working and she went from an apartment to mother, she shouldn't be needing money.

Starting point is 01:24:41 That's true. There should be more margin. She was making it before. Now she should be easily making it. And so you shouldn't be having to send money and use it to clean up debt, what I would do. But, hey, it sounds like you got it on the run, though. List your debts, smallest, largest. Attack them in that order, dude. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studios. I'm Dave Ramsey, your host.

Starting point is 01:25:27 Jade Washaw. Ramsey Personality is my co-host, number one bestselling author. Carrie is in Detroit. Hey, Carrie, what's up? Hi, a long-time listener, big fan. I'd like to thank you very much because I'm finally to baby step four. Yay, way to go. I am 51 years old.

Starting point is 01:25:47 Oh, going to be 51 years old. share. I have not invested anything. I was widowed very young. I just spent the last 17 years trying to survive and raise my two kids. Like I said, I just got to baby step four. I have about 20,000 put away into savings. Good. I have nothing left but my house, which I have about 90,000 on, and I am about six years into a 15-year mortgage on that. Phenomenal. What do you make? I make roughly around 64,000 a year. It is a little bit variable because I'm in business for myself. So I'm a housekeeper. So there are times that people cancel on me. So, um, but for the most part, my income is right around 5,500 a month. Good for you. Well done. Um, my question is, is never investing,

Starting point is 01:26:39 never having any type of retirement or anything. Where do I start to invest, especially with the market being volatile and having no financial education on how to invest money at this point. Okay. That's a really, really good question. I love your question. Also, do I invest more than 15% at this point? Nope. Because I have a little bit of cash fluidity.

Starting point is 01:27:06 Nope. You put it on the house. Let's get the house paid off above 15%. Maybe steps four, five, and six work together. Sit down with a smart investor pro. Click smart vester pro. at ramsysolutions.com. Their job is not to do it for you.

Starting point is 01:27:24 Their job is to teach you and say, here's how a mutual fund works. Here's what it is. Here's how stable this type of fund is. Here's how volatile this other type of fund is. And here's what we can do with a Roth IRA for you. And probably a, you got employees? No.

Starting point is 01:27:47 I am sole proprietor and worker. Okay. Then you can look at a simple IRA as well or a simplified pension plan, either one. We can do Roth and all of them. So you can easily get to 15% of your income going in. You'll be just easy to do that in your situation. Start with just a Roth, and then if you have to do a little bit more in an SEPP, a simplified employee pension plan, it's easy to do.

Starting point is 01:28:10 They're very easy to set up. They're very inexpensive to set up, not a lot of fees. and then just start putting a systematically 15% of your income away. If you never get a raise and you do that for the next 15 years, you're going to retire with dignity. Thank you because that has been a huge worry of mine. Not anymore. Not when you're not in the math.

Starting point is 01:28:33 Okay. So one of the things you do when you sit down with them, you say, okay, what's 15% of 65,000? All right. So quickly we're going to figure out that that is $10,000. Okay. It's about $850 a month. And you start doing that and you do that for 15 years, you're going to have a bazillion freaking dollars, hundreds of thousands of dollars.

Starting point is 01:28:54 I can't do it in my head right now, but you're going to have plenty. Okay. And you can actually look at the calculator on the Ramsey website and it'll help you figure that out too. But you just steadily invest and we're not going to wring our hands and worry about the market being volatile because the market is up. the market is down, but you don't lose all your money. It just makes a little more. It makes a little less. It's all it is.

Starting point is 01:29:20 It's like some years, houses go up, but more in value, and some years they don't. Right? Right. But there's still a good investment. They're volatile, but there's a good investment. Not very volatile, but they're volatile. They do go up and down. There's not a guarantee, but you're counting on the track record of real estate.

Starting point is 01:29:36 It's always gone up. Some years more than others. Some years may be down a little, but most of the time it goes up, a good, mutual fund or series of mutual funds in your Roth IRA will do the same thing and you'll have plenty. You're going to be okay. But you need to learn about all of that and to where, because what happens is your anxiety about the markets, your anxiety about investing and not knowing goes away the more you do know. Absolutely. Because right now I am completely bound by fear because I don't know anything. And it's just, it's taken me so far just to get to this point. And what

Starting point is 01:30:13 that fear should do is drive you to learn, not drive you to not do it. Right. And that's where I've been hesitant. Yeah. Exactly. So that that's normal. There's two kinds of fear. There's two kinds of fear. Fear that helps us avoid touching a hot stove, good fear. Fear that keeps us, that's false evidence appearing real. It's just something we don't know about it. We're teaching our child to ride a bicycle. They're afraid, but you and I know they're going to be okay. They may fall over, scratch, their little knee, but they're going to be okay, and they're going to have hours and hours and hours and years of enjoyment of riding a bicycle. So we put them to push them through the false evidence appearing real. They're not going to die. They're going to fall over. Oops. Okay. And so you learn that that's what this is. You're learning to ride a bike. You're not going to have any scratch knees, by the way, but you are going to have the fear of the unknown, which is different than the fear of the hot stove. You can do this. If I were in your shoes, I would start with reading. And Ramsey Solutions has

Starting point is 01:31:23 wonderful articles that are very easy to read and comprehend and understand. And I would start there. And if a word pops up that you're like, what do they mean by that? I would look up the definition. And I would just go down that rabbit trail and learn more and more and more and do that regularly. And after a while, the words that used to sound scary and big and you don't know what that means, that goes away. And you start to understand it more. And that way, when you do go to meet with your smart vester, you're going to understand what they're talking about and it's not going to feel like they're up here and you're down here. But their job is to put the cookies on a shelf where you can reach them.

Starting point is 01:31:56 That's their job, is to make this easy. Make it easy to understand. And if it's not easy to understand, get you a different person. Don't use that person. Correct. Are there any books that you would also recommend? Baby steps millionaires. Okay.

Starting point is 01:32:12 Matter of fact, we'll give it to you. Okay. Hang on. We'll sign you up for that. Yeah, just check SmartVestor Pro at Ramsey Solutions.com and sit down. You're looking for financial people with the heart of a teacher. Too many people around numbers think they need to sound like Charlie Brown's teacher. Wow, wow, wow, wow, wow, wow, wow, wow, wow, wow, wow.

Starting point is 01:32:31 I have no idea what the freak they said, right? So, no, you want somebody that talks in a language that you can understand and they teach you. This is how this works. And here's a mutual fund that's been open 100 years. Here's a mutual fund that's been open 90 years. It's had four down years in the last 27 years. Yeah. And you can look at the chart and go, oh, look at that.

Starting point is 01:32:51 The stinking thing made money 24 out of 27 years. Okay. That gives me a comfort level. That's an actual fun, by the way. Okay. So you can look at these things and get a handle on that. And then you go, oh, okay. Well, then maybe it's not as scary.

Starting point is 01:33:06 Ooh, the markets and everybody lost all their money. No, they didn't. They lose some because they buy high and sell low because they freak out and don't watch what's going on. So that's the difference. So you're going to do really, really good. You're going to end up wealthy and you deserve to be. You've worked hard. You've been a warrior single mom.

Starting point is 01:33:25 Very good. A warrior princess cleaning houses to raise those kids. And now you're going to retire with dignity. I'm so proud of you. Hey, guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now, you can get that same kind of help anytime with. Ask Ramsey. Ask your money question and get answers built on Ramsey principles we use on the show.

Starting point is 01:34:25 Whether you're making a decision or just want something explained, Ask Ramsey is here to help. It's fast, simple, and free to use. Go to Ramsey Solutions.com and try Ask Ramsey today. That's ramsysolutions.com. Greg is in Nashville. Hey Greg, how are you? You good. How are you? Better than I deserve. What's up? So, I have some whole life policies that me and my wife got like when we were like 20. I'm 50, probably 55 this year. I'm sorry.

Starting point is 01:35:13 And I know, I know. I've been listening to you for the last year or so. But my question is on it, should we cash surrender? Those, there's each about 100,000 cash surrender. I don't think we have to pay on anymore. I think we've had them since we were so young that I think they pay for themselves each year now. Yeah. And I don't know if it's worth.

Starting point is 01:35:41 I don't necessarily need, I mean, I can always use extra money, but I don't know if it's worth doing the cash to render on those policies or just leaving. They're small. I think they're $150,000 policies or something like that when we got them originally. Okay, she has a $150,000 policy with $100,000 cash value. Is that right? Yes. And you have two of them.

Starting point is 01:36:03 It's totally grows. Like they sold you on that stuff when you're young. No, I'm going to make sure I understand what you've got. Stop a second. Do you have two $150,000 policies and each of them have $100,000 cash value in them? Yes, if we were to surrender them now. That's what I'm asking. Okay, good.

Starting point is 01:36:22 Okay. And so if you die, you know they keep the $100,000, right? So you have $50,000 worth of insurance, in essence. Do you follow me? Yeah, I kind of heard that the other day on one of your shows, and that I didn't understand. I don't understand it either, because it's the biggest screw drop of the middle class in my life I've ever seen, but it happens all the time. So that's how a whole life policy works. I do have a $2 million term policy that we got a few years ago.

Starting point is 01:36:49 Okay. So you're covered if you die, right? You don't need them. Yeah. No. And my question is, even about the term, too, is. is like, do I need to keep that up with my value, or like my personal value or me, my wife's value is over that amount?

Starting point is 01:37:07 Should I, like, do I need that life insurance or is it just what we're keeping? What life insurance is for is to take care of her if something happens to you. If you have $5 million in mutual funds, you don't need life insurance. She's taken care of. Okay. Does that make sense? Yes. What life insurance for is to take care of you if something happens to her.

Starting point is 01:37:34 And if you have a big pile of money and you're okay without her income, then she doesn't need your self-insured on all of it. Okay? Sure. Then back to the whole life, the whole life is paying an average of about 2% in growth on that 100,000. Had that 100,000 been in mutual funds last year, it would have made 24% on average it would have made more like 12%. So you're losing somewhere around $10,000 to $20,000 a year in growth because that's so poorly invested.

Starting point is 01:38:09 Oh, and by the way, when you die, they're going to pay $150,000 out. Okay. Not a hundred. Not plus $100,000. Do I have to pay, if we do the cash surrender, do we have to pay tax on that? Your tax basis in a whole life policy is what you have paid into it over all these years. I suspect you've paid $100,000 into this over all these years. I would assume that it's been a money.

Starting point is 01:38:37 So your basis is probably higher. It almost always is. If it's not, it won't be by much. So if you have taxes, it'll be very, very, very small. But if you just say, here's what my premiums were over this number of years and number of months or whatever it is, you know, the 25 or 30 years you've been getting ripped off, then easily you probably paid in 100K. You're going to get your money back out. And yes, I would cash it in.

Starting point is 01:39:03 And if, what do you think your net worth is? I mean, I think it's close to six, maybe. Six million? If I were to sell everything. Yeah, if I were to sell everything. So do you think the current asset base would generate enough income for your wife to be okay if you died today? And then I think so. I hope so.

Starting point is 01:39:24 I hope so, too. I think pretty easily. I mean, that was kind of one of my other questions is I got this, I got some industrial property that I don't necessarily need anymore that I have, that I still owe about, I mean, if I were to sell it, I could cash that out for about two million bucks, maybe. Yeah. After taxes, but I do make income on that. It's up to you.

Starting point is 01:39:52 What do you want your money, invest? that's an investment and then you look at it and say is this an investment that's given me enough yield on my money I mean long-term investments you ought to be making 10 plus percent on whatever it is real estate mutual funds whatever there's not really anything else that you should that that's fairly low-risk portfolio that'll do that mine make a lot more than that and I don't take a lot of risk so but you got to look at that piece of industrial property is it making you a good return and then dump that but um Folks, the whole life cash value policy is the biggest rip-off in the financial planning world.

Starting point is 01:40:33 I mean, it's like the payday lender to the middle class. You know, payday lender screws poor people, right? And these people screw you. And it's a horrible rate of return. When you die, they keep your money because you've been paying extra for this savings account that you don't get. They only pay the face value when you die. It's that simple. And so get some inexpensive term insurance while you need insurance.

Starting point is 01:40:59 This guy didn't even need that anymore, probably. And put your money, your investment money and good investments that go up and they don't keep it when you die. And then you're not building a building in the skyline for somebody else. Or you think those life insurance buildings came from. They didn't come from Santa Claus. I know that. The same place those banks came from. They didn't come from Santa Claus.

Starting point is 01:41:23 came from them screwing you with credit cards all these years. And you're just smiling and going, I got airline miles. And you're just getting screwed over and over and over again. And it's just, you know, that's how this stuff happens. It's called a transfer of wealth from you to them because they're screwing you. And so you just learn about these things and you go never again. It changes everything. James is in Columbus, Ohio.

Starting point is 01:41:47 Hi, James. How are you? Better than I deserve. What's up? Okay, I have my youngest sister, she and her ex-boyfriend inherited a quarter million dollars about three to four years ago. He has since passed from cancer, and he, at the time, I was going through a messy divorce, and he gave me $6,000 to pay for my lawyer so I can, take care of my divorce. I'm going through a rough time as a gift.

Starting point is 01:42:29 And since then, you know, he's passed out, like I said, and she has blown through all that money in the meantime, and it's back to square one again. Wow. And, yeah. And she has not come out and said directly to me, but I heard it through my other sister, and she keeps asking, you know, saying,

Starting point is 01:42:52 hey, he needs to pay me back that $6,000. That was my money. So she's saying that the boyfriend got the money from her and lent it to you? No, no, no. It was his parents. It was his inheritance from his parents. Oh, okay. Yeah, and I can afford to pay it back.

Starting point is 01:43:11 Now, I'm in a good spot in my life, and I can afford to pay it back. I just don't feel like, yeah, I have to. I've helped her out with bills and stuff now that she's moving. have a lot of money, like, you know, the occasional electric bill, things like that, where she's, you know, called me up and said, hey, can you know, I've done stuff like that. Y'all are a hot mess, aren't you? Yeah. Yeah, right?

Starting point is 01:43:35 Are you, are you afraid that she's going to do? You're just afraid, you're like, why do I give her another $6,000 to be irresponsible with, is what you're saying? That, you know, she has three kids with them. They're little older. 17, 18, in that range. But, I mean, there's, I mean, there's, James, there's two, options, okay? The third option is not keep whining about it. Okay. I would either call her and say, your boyfriend gave me this money. It's a gift. I'm not going to pay it back. Or I'd write her a check.

Starting point is 01:44:06 But third option, I'm going to keep whining about this, and y'all keep this family drama going on, on, on, and who said what and who told George this? And good Lord, for $6,000. Decretting it up, man. All right, let's cut to the chase. It's easy to get discouraged about crazy house prices. and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey trusted agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back from the first call to closing day. Find a Ramsey trusted agent near you at Ramsey Solutions.com

Starting point is 01:45:12 slash agent. That's Ramsey Solutions.com slash a... On the debt-free stage in the lobby of... Ramsey Solutions, Chevy and Caitlin are with us. Hey guys, how are you? Great. How are you? Better than I deserve. Welcome. Where do you all live? Gordon, Indiana. Okay, cool. And what's that near? Louisville, Kentucky. Okay. All right. That works. Works for me. Perfect. How much debt have you all paid off? We've paid off 95,000 in 34 months. Good for you. Way to go. And your range of income during that three years? Started at 113,000 and ended about 156. Good for you. What do y'all do?

Starting point is 01:45:58 for a living. I'm an assistant nurse manager in a NICU in Louisville, Kentucky. Fine. Good for you. I'm an executive director of a maintenance facility at a trucking company. There you go. Good, good, good. What kind of debt was the $95,000? Our mortgage. You paid off your house. You did. Looking at weird people. I love it. Way to go, you guys. What's the house worth? Just under $500,000. Very cool. Very cool. And you all been investing in retirement, I assume? Yes. How much of your nest eggs? We're up to 1.30 between the three, like 130 per account for three accounts. That's awesome.

Starting point is 01:46:37 Okay, so you're getting close to a million-dollar net worth. Yeah, net worth, we figured it up on the drive down just to hair over 900,000. Almost. I blink and you're going to be millionaires. How old are you two? 34. And 36. Wow, way to go.

Starting point is 01:46:51 I'm so proud of y'all. Boom, boom, boom. Thank you. Baby steps millionaires almost in a paid-for house. not even 35 years old. Way to go. Excellent. Excellent. Excellent. Okay. So what started this whole journey doing this crazy Ramsey stuff that made you millionaires?

Starting point is 01:47:05 So Chevy did actually right around the time that we got engaged. He came home and said, I think I want to do this program. And I kind of looked at him like he had six heads. I was like, I don't know what you're talking about right now. So we used it as a premarital counseling kind of thing. Started our individual snowballs back in 2017. and then when we got married, we combined our debt. So we actually entered Baby Step 7 for the first time in 2020,

Starting point is 01:47:31 right around the time that COVID was shutting everything down. After that, we started a family and decided to upgrade our house. So we was able to take 100% of that house we had paid off and kind of move forward to the current house we have now. So we only had $95,000 in the mortgage when we bought our house in December of 22. Okay, sure. A huge down payment from the other one. And then had to knock that out quickly.

Starting point is 01:47:55 Right. Yeah. That's exciting. Good for you. Way to go, y'all? Thank you. Thank you. How does it feel to be this free at this age?

Starting point is 01:48:03 Pretty great. It's awesome. You know, the grass definitely feels different underneath your feet when you step outside after the last house payment. Absolutely. Will you ever do it again? No. No, that's it.

Starting point is 01:48:13 Not worth it. Next time we'll save up to move up. Yeah. We're pretty happy with our house right now. I love it. I got to believe that it played a big part in what house you selected to kind of knowing the feeling of dead and not wanting to experience too much of that. Yeah, definitely did. And it really worked out. I mean, when we hit Baby Step 7 in 2020, when we paid off our house,

Starting point is 01:48:35 it was shortly after that we lost our child, our first born at 18 months. Oh, 18 weeks. We lost a little girl, Ellison, at 18 weeks. And because we were in Baby Step 7, I was able to really step back from work and take some time off to get myself right before we moved forward in our lives and that's kind of when we decided like we're going to do things a little different from here on out and we're so incredibly thankful we started FP when we did or else I really don't know what we would have ended up in that situation I wouldn't have been able to take that time off of work and really heal ourselves before moving forward you just never really know what life's going to throw at you and I think FB really sets you up to be able to handle anything like that wow wow such a heartbreak

Starting point is 01:49:17 and have have built a life that allowed you the luxury to step back and have a moment to heal from the most devastating possible thing that can happen. Wow. Amazing. Wow. Very cool. And you got kiddos, too. We do. We have three. Two boys and a little girl. They're four, two, and eight months. Oh, handful. Okay. We were hoping to get through this, the 95,000 a little quicker, but, you know, having three kids born in that timeline, it was slowed us down a little bit. I bet. Just a little. Just a little. But it was awesome, you know, being able to the cash flow, saving up for each child, you know, on top of paying, you know, the mortgage down, too. So you guys have been through this in a sense a couple of times.

Starting point is 01:50:02 Yeah. And so what do you tell people the secret to getting out of debt and be almost millionaires by the time you're 35? Definitely communication. We still have budget meetings at the first of every month. We kind of walk through what we're going to do that month if there's any big adjustments coming up. But there's definitely months that I've struggled staying on task a little more and months he struggled staying on task a little more. So communication and definitely just lifting each other up when the other person's struggling. What are you going to do to celebrate?

Starting point is 01:50:30 We got a few little projects around the house we want to do and then definitely travel some more. We definitely like getting the kids out and showing them all the different things the world has the offer. Yeah, we just got back from New York City last weekend. We got caught in the blizzard up there. Oh, gosh. That was a blast, yeah. Yeah, it was crazy. Man, get caught up there with babies.

Starting point is 01:50:47 That'd be great. It was just a mommy daddy trip that time. Oh, that's good. I was the first trip out of the house without all three of them and got stuck in a blizzard. Still takes the edge off of it. Yeah. Oh my gosh. Wow.

Starting point is 01:50:57 Well, good for you guys. Congratulations. We're very, very proud of you. Do you have people encouraging you along the way or thought you were crazy? A little bit of both. Yeah, our families are definitely encouraged us along the way, kind of side-eyeing us the whole time. Like, you guys are still a little crazy.

Starting point is 01:51:12 But we're going to support you and what you're going to do. So we definitely couldn't have done it without our family support. They were definitely after us because I was selling everything I could find in the house left and right on eBay and Facebook. Well, I was going to say, did you tell them you were doing it or did they start noticing, you know, crazy behaviors? A little bit of both. Yeah, I got to the point they were afraid to gift us something if you didn't actually

Starting point is 01:51:32 wanted or need it because it would probably be up on eBay or Facebook. Wow. I would have given you something for Christmas, but you're just sold it. Yeah, pretty much. We actually heard that several times. That's funny. Well, way to go, y'all. Did you bring the kettos with you?

Starting point is 01:51:50 Yeah, they're here. All right, let's bring them up and introduce them for the debt-free scream. Oh, man. I thought I heard them in the background. Oh, man. This is Nash. This is a reason to change your family tree right here. This is Finn and this is Townsend.

Starting point is 01:52:04 All right. Well, you guys have got mom and dads that are heroes. They've taken care of you. You set you up for an incredible life. Like that way. Yeah, you guys are in great, great shape. Well, so proud of you guys. Congratulations.

Starting point is 01:52:16 Thank you. Chevy and Caitlin from Indiana 95. thousand paid off in 34 months making 113 to 156 house and everything we're looking at weird people count it down let's hear a debt-free scream ready boys three two one we're debt free free I like it that's great I love it I love it I love it and then I read the articles of the millennials and the gen zes that can't get ahead and can't afford a house but these guys figured out on a $156,000 income to not only have a paid for home, have three children. Yeah.

Starting point is 01:53:02 And have a net worth approaching a million dollars very quickly at not even 35 years old. So I don't know. It just confuses me that it can't be done and yet it's done every day here. Sounds like a combination of will and location, will location and income. Yeah. And those are all tied together by the way. You can choose your location. you can choose your will and you can choose to affect your income in a lot of ways.

Starting point is 01:53:30 That's right. Yeah, but we talk to people that make twice that and think they can't afford a house. That's absolutely true. The housing prices are just out of reach for American couples today. You can't house affordability issues. We have affordability issues. I wish the president would wave a wand and make it all go away. I wish mommy and daddy would not make me be an adult.

Starting point is 01:53:53 But yeah, the math still is there. And these people just did it. Well, earlier, we talked to the folks that made $150,000 a year, and they were saving up, they were almost there to buy it in cash. $400,000 house. Yeah, they were in Arkansas. Yeah, I remember, yeah. So. Now, they were, I don't know what they, how they were doing that.

Starting point is 01:54:11 They were living on. That was even beyond. Wow. They were living on nothing. It was crazy. But it absolutely worked. So Chevy and Caitlin have become heroes for Finn, Nash, and Townsend. Those little babies, they're beautiful.

Starting point is 01:54:25 their lives have been changed and they don't even know it yet. Pretty crazy. And they go through a tragedy to boot in the middle of the thing. So just absolutely amazing. Yeah, it's never a straight line. But there's a line. There's a line. Way to go, you guys.

Starting point is 01:55:20 When people hear my story of paying off debt, they say things like, dang, that must have been so hard. I can never do that. And I tell them, sure you can. It's a short-term sacrifice for a long-term gain. But do you know what's really hard? working your whole life and never having anything to show for it, never having the long-term gain, just feeling broke and stressed and maxed all the time. And sadly, that's the hard that most people

Starting point is 01:55:44 choose. Listen, you're capable of transforming your situation and living a life of freedom, but you need the right tools to do it, like our every dollar budget app. In minutes, it'll build you a step-by-step plan that's tailored to your money situation. And every day, it finds ways you can free up extra money in your budget so you can get rid of your debt and actually build wealth. So make the choice today. Short-term sacrifice, long-term gain. Choose the tool to help you get it done fast. Download the every dollar app and start for free today. Our scripture of the day, Neum 1-7, the Lord is good, refuge in times of trouble. He cares for those who trust in him. Simon Seneca said, it is a luxury to put our interests first. It is an honor to put the

Starting point is 01:56:39 interests of others before our own. Buying or selling your home is a big deal, and with all the clickbait headlines and conflicting data out there, it's hard to know what to do late, do next. We're here to make the latest trends easy to understand. Median home prices dipped a little below $400,000 last month, which is typical for this time of year. Mortgage rates are sitting at about 5.44 in January, down from 6.27 last January. giving buyers some breathing room.

Starting point is 01:57:11 We're starting to see some movement in the market. To learn more about the housing market trends and get free tools to help you buyers sell with confidence, go to ramsysolutions.com slash market or click the link in the show notes if you're listening on the podcast or YouTube. Joshua is in Los Angeles. Hey, Joshua, how are you? Hey, Dave, I'm doing good. I'm doing good. It has been, let me say, about two or three years since I've been trying to get on the radio.

Starting point is 01:57:36 and I am truly glad that it is you and J. Obviously, everybody else on the show is amazing, but I needed some tough love from Dave today. So I've made some mistakes financially. I've, let's see, at the beginning of 2025, I purchased a Toyota Corolla. I purchased it out. I went to a creating.

Starting point is 01:58:06 and the total amount was about $30,000. And then at the end of this previous year, I got a truck. I know not smart. So I'm in a hole that I am regretting digging, and so I've been trying to dig myself out, but I keep on running into roadblocks. No, you keep jumping from hole to hole as part of it, right? Yeah.

Starting point is 01:58:36 Okay. So what do you owe on the truck? So I owe on the truck 46. Oh, boy. And then I, let's see, I have a personal loan for $8,000. And then I have probably about a couple thousand with the credit cards. And then I want to pursue higher education, and that's going to cost about $40,000. at Grand Catney University for pursuing, what is it called, my LPC license. Yeah, that's off the table where you get this mess cleaned up. You got a $40,000 not a problem. I don't need to create another one.

Starting point is 01:59:22 Exactly. Yeah, I know. Okay, so what do you make? So I make early about 56 a year. Okay. I've been working very diligently to find more income. And so I have an opportunity to work for a previous employer and make about an extra like 12 to 15 extra a year.

Starting point is 01:59:51 Good. And so I'm thinking like, I'm thinking that that would solve this issue of the Well, that getting rid of the truck. What's the truck worth? The truck is worth 42. Well, that's not too bad. You need $4,000 and you can sell the truck, right? Right.

Starting point is 02:00:12 Well, let's get rid of that thing. Yeah. How quickly could you save the difference? $4,000. I would probably say, like, realistically, if I just make the minimum payments, to my credit cards, it'd probably be like, maybe like three months. No. I want you going hard in the paint, working every hour you get to do this. Take the new job, get the income up, and you need to get rid of this truck in a month or so.

Starting point is 02:00:46 Where do you live? What's your living situation? I currently do with my parents. Okay, you live, so you don't even have rent to pay? No, I don't. Then this should go into what? If you, if all this, all you have is minimum payments, you have no rent. Yeah. If you make your $4,000 from your current job and you go out and side hustle and kill it, that'd be my goal. What are you spending money on? Yeah. Car gas, insurance, and credit card minimums. Yeah. Yeah. Okay. So yesterday, let's get rid of this truck. Right. The thing is you got to decide, you got to decide if this truck is really as stupid as we have. And once you decide that, because I'm really, if I'm in your shoes, I'm really pissed about this truck because it's standing between you and a good future.

Starting point is 02:01:35 And so that means you got to bust it and get rid of the stupid thing as fast as possible. It's a curse. It's not a blessing. Okay. And do you have any recommendations on how to? Obviously, like private cell. Yes. And then on top of that, I've tried, or no, no, no, mind.

Starting point is 02:01:57 That's a credit union. But I tried purchasing it. outright, but that didn't work. What do you mean? Meaning I was going to go from a lease to a purchase. Okay. Oh, it's a lease. It's a lease.

Starting point is 02:02:14 So what's the payoff amount? 42. Or 46? 46. Yeah. 46 is worth 42. So you're saying that you can't buy it out and then turn around and sell the car? Yeah. You can. Okay. And so what you have to do is find someone, a dealer or a person that will write you a check for 42. You have to add four to that check and buy out the lease. They hand you the title. You hand the buyer the title.

Starting point is 02:02:45 And that's how the process goes down. You may need some help with that with a friend that's around car dealers. But, you know, with how to actually mechanically do the transaction in Los Angeles, California. But that's how the method works. You have to have all the money to pay off the car dealers. the lease to get the title and then they hand you the title and your hand the title. In the meantime, the new buyer is driving it off a bill of sale. And that's how all transactions work, but there's a few little nuances to how they'll go down in different states and how the process works. And I'm not positive about California, but that's a concept that you're working off of,

Starting point is 02:03:21 Joshua. The big deal is you've got to decide this thing has to go. Yes. Suzanne is in Albany, Georgia. Hey, Suzanne. What's up? Hi, I'm so glad. I'm so glad I got through to y'all.

Starting point is 02:03:31 I'm glad you did too. How are y'all doing today? Yeah. That is what's up. Well, we have a question. My husband and our both retired school teachers. We bring in about net about $9,500 a month between our pension and such security, and we both have part-time jobs. Great.

Starting point is 02:03:50 Our house is paid for. It's worth about $425,000. Great. We have about $300,000,401K, and the $15,000. in our raw. Now, this is the question. We have a car that we still owe $10,000 on, and we also have a lot that we bought about three years ago for us to build our retirement home on, which we want to pay cash for because we want to sell the current house for in, and we build this house. And we owe, it's about $60,000 on that lot we have. And so we have

Starting point is 02:04:27 that. That's our only debt. It's $60,000 on the lot. We're paying 7.25% interest, and then the car, which is about 3 and a quarter percent interest. When are you going to build the retirement home? We want to start maybe this fall. Okay. The lot debt will roll up into the construction loan because the construction loan won't take a second mortgage position. They're going to want a first mortgage position. So your construction loan is going to be plus the lot debt.

Starting point is 02:04:57 Yes. So that's going away and going to roll. up into your new mortgage. Okay. Well, our question was, so otherwise, I see what you're saying, but this is what we were wondering. Should we take out the, you know, we can take out, I want to leave at least five in that raw, but could we take out 10,000 in the raw, if we wouldn't pay any penalties, pay off

Starting point is 02:05:19 the car with that, and then my husband was thinking about taking the $60,000 out of his 401, who would have to pay $20,000. You've got. You can pay it off. fast with just your income. You make $9,000 a month. Pay off the stinking car. That was the question. Yeah, that's the answer. That was my third. Yeah, pay off the car and then roll the other thing up into the mortgage, up into the thing. And then when your house sells, it pays off the retirement house, right?

Starting point is 02:05:47 Yes. Okay. So you'll be debt free with never having touched, never having touched your retirement. And that's exactly what I would do. Yeah, just be careful not to overspend on the retirement house. Yeah. Keep that down under the value of yours. That puts us out. 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.

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