The Ramsey Show - If You Want To Do Great Things You Need To Do Hard Things First

Episode Date: October 6, 2025

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brought to you by the every dollar app start budgeting for free today normal is broke and common sense is weird so we're here to help you transform your life from the ramsie network in the fair winds credit union studio this is the ramsie show so excited to have you with us, AAA 825. 5225 is the phone number to jump in. AAA 8255225 alongside the fabulous, the incomparable Jade Warshaw. I am. Thank you, my friend. Ken Coleman, just happy to be in her presence, folks. It's going to be good, fresh off of Orlando. We might talk a little bit about that. We'll see. Orlando, I can't speak now, and Chicago. Shy Town. A couple live events, so much fun. We are feeling the juice from those. Two great crowds. Jessica is up in Arkansas. Jessica, how can we help today? Hi, good morning or good afternoon. I'm sitting at just a tad bit under a million dollars in debt.

Almost 200 of that is unsecured. And we were contemplating bankruptcy, but my face tells me that I should be paying all this. and I know I should. And I'm just, I guess I'm trying to see if there's a light at the end of the tunnel for us. There's always hope. Why don't you lay it out for us? Give us the whole $1 million in debt. What is that? So 210 is unsecured personal loans.

83 of that 210 is credit cards. The house is $658. Okay. And then there's $2.10. two vehicles that um there's two vehicles in there one's almost paid off and then the other one is very very upside down tell us the amounts uh the first and the second one is we owe 12,000 on it and the other one is 59,000 oh and how much do you know off the top of your head what that 59,000 one is worth um 35 girlfriend okay um how much um how much

you guys earn it's you and your husband yes and he is in a job transition um so we were making over 300 now we're at sitting at about 259 a year okay good that's listen there's your light at the end of the tunnel right there is if you had told me that your shovel was 60 or 70 000 i'd be really hurting with you um but the good news is you have a really great shovel uh 259 and you said that's with or without the job loss? That's with the job loss. And his new job is going to be commissioned only, so we haven't, we don't know what that's going to look like yet.

It could be amazing. So you make $259. We have some retirement funds in there from military and disability. How much of that is the military? Like, how much of that is your income and how much of that is like pension type stuff? about half okay good that is really really really really really good um tell me about the 210 000 was this a business loan what what was that money for it was a little bit of everything honestly it was um some bad business endeavors me trying to be a serial entrepreneur okay it was um some bad

financial decisions just in general um imposter syndrome yeah i took took took a fantastic career opportunity, and I just kind of shopped my way through the imposter syndrome until I got to therapy. Okay. And so that was some bad financial decisions there, luxury shopping. And then I took over, I took out two personal loans to clear my husband's credit card debt as well. So that's what all that is.

This is like classic mo money, mo problems, right? This is you had a big income. and so you could afford to make bigger mistakes, right? But really, when we boil it down, Ken, ratio-wise, it's the same call we always hear, right? So that's the good news is, you know, you've got $260,000 in income right now. It's going to go up exponentially.

And you got, you know, I'm not counting the mortgage debt because when we're in Baby Step 2, which is the step where you're paying off all the consumer debt, we really don't count the mortgage. So can you tell me how much your monthly mortgage payment is? so I can see what percentage of your life it is? 39, 38. Okay, and so that's going to be fine with what you're bringing home.

So the mortgage is not the problem, and I just wanted to explain that to you. It's no more than 25% of your take home, so that's not the issue. The problem is you feel overwhelmed because no matter how you slice it, if you tell somebody you have $300,000 of debt, that's a lot, right?

Yeah. Are you familiar with our debt snowball? Yes, I actually did it probably about $20,000. years ago, and the only that I carried up until three years ago was a mortgage and a car payment, and I would usually pay the car payment, you know, double or whatever. Yeah. Well, are you, okay, we get that, but let's talk about the now, because your question is, is there a light at the end of the tunnel? The answer is yes, if you're willing to look for it. And so, are you done now? Oh, for sure. Are you done? Is this the last time you're ever going to

do this? Oh, for sure. Okay. I can't do this again. Okay, so in this situation, my take is I would try to get massive momentum, you know, and Jade can speak to this. I'm going to give it back to her quickly because she and Sam paid off $500,000 in debt. So you got the perfect person to talk to today. But here's my only thing that I would say, and I'll hand the baton back to you, Jade. I think they need a momentum play, like a big one. And so I would be a tack, I would try to get rid of the $59,000 car payment. Instantly. Like even if they go upside down, you can tell her how we do but I just think there needs to be a dramatic move. I don't know what your take is, having done this yourself. No, I agree with Ken 100%. You do. You need to do something that's going to shake you

emotionally, that's going to shake you financially. That's going to almost like, it's like the gun going off of the race, right? And I agree with Ken. You guys need to pull together, and I mean, with your income in a couple of short months, pulled together that 24,000 that you're upside down on this vehicle and get out of it and, you know, drive the $12,000 vehicle for a while, figure out a plan to save up another, you know, a couple thousand dollars to get you a beater. And here's the thing, I'm going to be 100% straight with you. You're used to making a lot of money. When you get a beater, it's going to mess with your ego big time. Because in your mind, you're going to go, wait a minute, I work too hard to be driving a car like this. Wait a minute. Nobody at my work

drives a car like this or nobody in my social circle, right? Because you start hanging out with who you earn money with, right? And so you're going to be the one and it is going to create questions. And it's your choice whether you answer those questions. But I'm just letting you know right now, Jessica, that's going to happen. And there's going to be an incongruency for a while with how hard I'm working and how much money I'm earning versus the lifestyle I'm living. And I'm telling you that as a person who did that for quite a while. And that's going to be so good for your soul because that's what's going to cause you never to do this again. You're going to go, oh my gosh. I never want to feel that again. Seriously. I think it's right. And, you know, not trying to steal too much of your story. But, I mean, Sam and I were hanging out last night, Jay Tuss. And he reminded me you guys had one car for a long time.

We didn't get a second car until a year into working here. Yeah, but that was just because you adjusted to it. I did. But during the massive debt payoff, you guys were one car family. But you said it, Ken. We got used to it. That's right. You did fine.

You get used to anything. Right, right. You could be making multiple six figures and get used to whatever lifestyle you create. Yeah. That's hilarious to me that you were here for a year before you got wheels. And even still, I was a little reluctant. I was like, we don't need it. Listen, now get me that G-wagon.

I'm ready, Ken. Come on. Statistics show that half of Americans don't have enough life insurance or they don't have any at all. I don't understand this, John. Why don't people want to take care of their family? They think they're going to die or something? Well, I used to be one of those guys. I didn't even think about it. And one of my buddies said, hey, the only reason to not have life insurance is if you hate your wife and kids. kids. And I immediately went and got term life insurance. That's a gut punch. And oh, you're telling me, and for decades, Dave, I've sat across people who've lost a spouse. They've lost somebody important to them. Me too. They don't know what to do next. Me too. I mean, you're going to have

a crisis here. And, you know, you got two options while you're sitting and talking to a young widow. She's concerned about how she's going to invest all this money properly and not mess this up. Or she's concerned how she's going to eat tomorrow. These are the two options. And take care of your dadgum family, term life insurance can replace income, pay off debts, cover funeral expenses so your family can actually have the opportunity to just be sad, to just miss you. That's exactly what it's supposed to be. It's saying I love you to your family, term life insurance. Jeff Zander and the team of Zander Insurance makes it easy and affordable. I've used them personally for 25 years. They're the only people I trust. Go to Zander.com or call 800 356, 4282.

All right, April is up next in Ohio. April, how can we help you today? Hi, guys. Thanks for taking my call. So I am recently divorced, 44 years old. I make 50,000 a year. I have one debt, and it's a car. and I owe $29,000 on it, and I have to decide whether I want to keep the car, tell the car, pay the car off, or what to do with the bag on car, because I want to be completely out of debt, and I want to eventually buy a house.

Tell us how much the car is worth right now on the open market. About 23, probably. So upside down six, do you have any cash? I have 57,000 in the bank. Oh, this is a non- Yeah, sorry, is that the only debt you have? It is the only debt I have now. Okay, go ahead, Jade, yeah, okay.

In the infamous words of Ken Coleman, this is what I'd call a nothing burger. Oh, yeah. Which means there's no problem here. That's right. You can decide today to just pay it off. We've got the money. Right. Why are you not doing that?

what's stopping you? Well, because I'm trying to make sure I have enough money for a down payment on a house. Got it. And so in the Jeep is currently my ex-husband's name, so I have to either refinance it my name, pay it off, get it titled to my name, or I saw it about, you know, living like no one else. I can live like no one else and sell in the dagon thing and driving the junker for a little while. But, I mean, I don't really want to do that because my car is reliable. It's only got 50,000 miles on it. Like, it's a good vehicle.

vehicle. It's not really the vehicle I wanted when I purchased it, but it's a good vehicle. It's in his name? It's in his name, yeah. Well, either way, yeah, either way, you've got to, if it's going to be your car, you've got to move it to your name and make sure that you're the one who gets the title and everything like that. You don't have to eat up most of the 57. I get what you're saying. So you said you're upside down 6K. So if you sell it for 23, okay, and then we, take the six out of the 57, that leaves us with 51, and we're a hole on the car. And then I'm

telling you right now, like, this is the spiritual gift that I have that nobody knows except for James Childs. He can attest this. I can find you a car right now for 10 grand that is extremely functional. It's not an absolute piece of crap on wheels, and it will get you through it. And let's say now you're down to 41,000. You're debt free. You've got a serviceable, car more than enough in the emergency fund jade to fix the $10,000 car i mean you could go 12 and get a very serviceable car and now you're debt-free emergency fund and now on to baby step 3b which is saving for the house unless i'm missing something um there's no reason for you to hold on to this money because we're not telling you to go empty it or even cut it in half

right right so you think your advice then would be to sell the jeep buy something cheaper and just take the 6,000 loss instead of paying it off completely. Oh, I thought the 6,000 is paying it off completely. You're going to sell it for 23. Well, I mean, to keep it. I mean, your advice

is to sell it instead of keep it. I would, personally. I would. Oh. Okay. Because it's attached to him. I'll explain my reasoning. There's no right or wrong on this is what I'm guessing you're going to say. Yeah. You can keep it and pay it off. Like, to Jade's point, you could pay

the entire 29 down today out of the 57. Now you got yourself a car that you're used to and yada, yada, yada. Well, the only reason I wouldn't do that is because, yeah, Ken is right. It's too much of your take-home pay. Like, it's too much of your pay. It's more than, it's more than 50%. And you probably would not have bought this car if you were just you, right? You would have bought something a more affordable. And my advice was based on helping you save for the house. So I gave you the advice to spend the least amount of money, but still be moving forward in your life? Gotcha. You track in with me?

So you sell it. You get 23 for it. You're going to come out of pocket six to take care of the loan. Now, now you just got a bunch of money back. What's that car payment every month? $5.63. Girl, that's like almost $8,000 a month. I mean, a year we just saved you.

Now, now, okay, you go buy a $10,000 car. and you're still left of $47,000, the way I added it up earlier. And so you've still got a real nice case of momentum here because you're coming out of the divorce. We got rid of a car with your ex's name on it. It's too much car for you. All the things. So that's why I gave you that plan because that is what I would do if I were you. That's what I would do.

And it's going to feel good getting your own, I almost said, set of wheels and then that felt very retro. You're going to feel good getting your own car. That's because she hangs out with me. That's me. That's my old influence on you. That's going to say whip. You're going to feel good in your own whip. That's not it either.

Yes, exactly. You know what I mean. Awesome. That helps so much. I thought that's what you guys would say, but I wanted to just make sure because I was literally going to call and just pay that off today. And then I'm like, do I really going to do that though? No, yeah.

I want a car. Think about, see, here's the thing. We get rid of a car attached to a chapter of your life that's over. That's not the single reason for this. but it's a good reason. And it's all about momentum. Many times our advice is about momentum. Getting that, and boy, just getting rid of that $560 car payment.

That's a lot. That's going to feel great, getting rid of that other car. And now you go get your own thing and you go, I'm sacrificing on a $10,000 car because I want my own house. Ooh, I like it. I on the prize. And so if I am sacrificing Jade, in the short term to see that it's going to give me an absolutely legitimate shot at the long term

that I desire, man, that feels good. I'm in. You don't have to talk me into that kind of a sacrifice. And the other thing is, is I like to say this, and I get too excited about this, I know. But I can't begin to tell you how many decent cars there are out there for $10,000, $15,000. And most Americans are just, they think they're above it. Yeah, I don't understand. I mean, I get it.

I get it. It's a status symbol, right? I totally understand. But I've said it before. I'll say again, Ken, you get in the car and, yeah, you ride to work, but it's sitting outside. And most of us, let's be honest, most people in America, if you have a garage, it's filled up with junk. And you let that beautiful Mercedes or that beautiful, Accura, or whatever you drive, sit outside, get in the rain, get in the snow. And then when you go to work, it sits in the parking lot.

Yeah. And no one is walking in the parking lot going, oh, I wonder if that's Bob's sedan, right? No one cares. Nobody cares. And I'll tell you this. A couple things. And Jade can back me up on this.

She knows what I drive. It would surprise a lot of people what I drive. I drive an older used car. It's a fabulous little Mercedes. It looks fantastic. Looks better. It looks newer than it is. But I'll tell you this.

Nobody, and I mean nobody, pulls up next to me at the stoplight and goes, oh, ha. I got that Ken Coleman over there. I'm not sure why he's driving that late model there. Nobody cares. Nobody even notices me on the interstate. Right.

So, you know, I choose to do that because I've got higher priorities. Yeah, I am right there with you. My money is in other places, and you know. I do. And so, you know, for me, it has always been functionality over status when it comes to a car. Now, there's a day coming. Oh, it's coming. When I get all the kids off the payroll.

G-wagon. Oh, man. Yeah. see me rolling. I'm going to have a car with a trumpet on it just so everybody knows I'm coming. Not a horn. Like a, oh, here comes Coleman. He wants everybody know that his kids are out of the house. It's going to be like a, by the way, at the Ramsey Show Live. Yeah. I learned a new term. Hit me. I didn't know there was such a thing as a push present. I'm wearing mine right now. Well, it's ridiculous. What made you transition to that? Because I'm going to have a baby.

empty nest present for myself when I get the kids off the payroll James you're going in daddy is going to go buy himself a really fun toy and just say it's mine because I've taken care of everybody else forever thank you ma'am there's the lady out there who's giving

me a really solid head nod I like that you get a retirement present you get a present when you have babies I am now making this up James it's an empty nest present well Stacy is such a lucky lady Tushé, sir. That's great. She'll get something to.

Yeah. What are we talking? I don't know. I'm making it up on the spot. I don't want to commit. It feels expensive. It's going to be expensive. Hey, side note, though, I think we should have a spin-off show where you people call in and you find them used cars live on the air and then sit in the link.

I would love to do that. I'd love to be your used car guy. Ken's cars. I like this. It's got a nice little ring to it. All right. We'll talk about it. I'll see what happens, folks.

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slash Ramsey and code Ramsey. boy, is it, it's worth all the hype. You can watch the premiere on our YouTube channel to actually see how every dollar works. It's more than a budgeting app. We've got all of the great things that you knew if you've been around for a while about Financial Peace University, actual coaching, so many great prompts. I mean, it's just there for you. People are finding thousands of dollars in margin in just 15 minutes, just through the prompts. and the pathway that we're walking you through. So imagine how much you could find

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but that premiere will do it justice. Yeah, so fun. Kevin is now joining us in Miami, Florida. Kevin, how can we help today? Hi, I was just calling because I recently graduated from grad school, and I have some loans and debt, I guess you can say. So, I'm kind of transitioning in life from being, like, a student basically enjoying the workforce. So I just wanted some advice and, like, some wisdom, I guess you can, I can take with me as I start this new stage of life. Okay. How much debt do you have?

so it's me and my wife which my wife is still in grad school she's in her currently her second year grad school and it's i have a total of 180,000 and 140 of it it's from my student loans and then 15 000 is from her spending loans and then we have a total of 16,000 in credit card yeah do you have a job The name is, so it took me a while to get license in my state, so I just got approved to be working in my state. Licensed to do what? Pharmacy. Okay, so I appreciate that you're licensed now. Do you have a job?

Yeah, I just got a job yesterday. Okay, congratulations. Yeah, so I started that job in two weeks. do me a favor do me favor can you adjust your phone i feel like you've got a sock over your phone oh uh can you hear you better now it's a little bit better um sorry i'm really struggling my ADHD is like flaring um how much you're going to make as a pharmacist uh so the job i have is it's not full-time or part-time it's basically as needed uh for them so the hours aren't guaranteed but i'll be

making $71 an hour. $71 an hour. Do you have any sense on how many hours you're going to get? Because I don't like the way this sounds for a guy who's got all this debt. Yeah, honestly saying, but I've been applying to all these places, and this is basically the only one that really got back

to me. Right, but you understand, like, that's not a great deal. You don't even know how many hours you're going to be working two weeks from now. Yeah. I mean, during the training period, I'll be getting 10 training training days, I guess you could say. So I'll for sure have that. And then after that,

how it was explained to me, there's some weeks I'm going to be doing like 20 hours in a week. And then there's some weeks I'm going to be doing like 40 hours in a week. Okay. So you understand, though, that you've got to be more resourceful right now. That means you're working at a coffee shop. You're working two, three, four jobs right now.

Yeah. While, by the way, looking for a better pharmacist gig, because this is going to eat you alive. What is your total monthly bills when it comes to just these loans, all this stuff combined? So the loans are still in grace right now, and I don't like the repayment of it until, I guess, December. Okay. That's not long right now. Yeah. Brother, December is literally around the corner. Okay.

Exactly. So that's one of the reasons I'm calling because it's just like income, my friend. Listen, our debt snowball plan. I bring Jade in on this, but I'll just say this. Income, income, income is your issue right now. You've got a wife who's in grad school. I don't know how much she can work with the grad school load. So I'm being realistic there. I don't know what she can do. So if she can't do much or anything, I mean, you're the one that's got to be working. And when I said two, three, and four jobs, I wasn't just saying it, you know, to hear. hear myself think and talk, you've got to bring an income because December is coming quickly and it's going to be a rude awakening. And so it's the debt snowball plan. Jay to walk you through it. Step by step what you have to do right now. Yeah, there's two things at play here. And Ken said the first one, you need money. Like, you got to have money coming in. And then the second thing, sure, you can tighten up your spending and tighten up your budget and those sorts of things. By the way, we'll make sure that we give you a budget. We'll give you every dollar before you get off this call because you need it. But that is the equation. You guys have a hole here and

you dug the hole and now you have to do the work to get out of it. There's not really an easy button here. I wish there was. If there was, I would slide it your way, but there's not. So it is what Ken said, which is probably wasn't what you planned, right? We all plan, I'm just going to get a great job right away and I'll just be able to get out of it. But that's not the reality here. And a part of this, I would say, of the equation, I would say 80% of you doing this is just accepting that this is what must be done. And if you can do that, then you can go about the business of actually doing the actions. So part of it is saying, hey, if I want to get where I want to go, there's part of this, I just have to accept. It's like running a marathon, Ken.

When Sam and I ran our first marathon, it's like in your head, you go, I know I want to do this. This race seems good. I'll feel great when it's all over. want to accomplish this. And then when you start the training, you're like, oh, wait a minute. This is, it's every day and it gets progressively harder. And what if I get injured and my body hurts and all these things? And half the battle of running a marathon, which in this case, you're dead as the marathon, half the battle is just going, hey, this is what must be true for this amount of time. And if I just embrace it and do it, the finish line will be there. That's right. The finish line is there. But if you want to

cross it with any amount of grace or style or good timing, then you have to embrace the training and that's just how it works. Hard things. If you want great things, I promise you, you're going to have to endure hard things. I don't care if it's athletically. I don't care if it's wanting to start a business and grow it and become self-employed. I don't care if it's, I want to go into ministry and touch lives and pour my heart out. You pick any endeavor, physical, emotional, spiritual, financial endeavor. If you want to be great or do something significant, forget great, sometimes we make great too, like, you know, oh, it's about great, great, great.

If you want to do something significant, I can tell you it's on the other side of hard things. Man, can't avoid it. You know? You cannot. It's unavoidable. Yeah. And it's like sometimes we're like, oh, success and all the things. And we were helping people with money success, work success, relationship success.

That's what we're about here. I'm just going to tell you something. I've been married 27 years. As James said earlier, God bless Stacey. I mean, the woman has had to endure some hard things to make it this far. You know? I mean, it's just, it is what it is. But there's also, and let's break it down further, because there's the hard things that we want to do.

Like we say, I'm going to go to school and I know that's going to be a challenge and I know it's going to. Like there's the hard things we want to do, but there are then the hard things we don't want to do. And those are part of it. Oh, yeah. And I think that's really the main, you know, where it disconnects. It's like, wait a second. I knew I was going to have to do hard things, but nobody told me I was going to have to do hard things I didn't want to do.

Correct. Yeah, it's like going on that training and everything or I'd rather have been home watching football elbow deep and some salsa. You know what I mean? Yeah. I mean, that's what I want to do. But nobody wants to be out there pounding the pavement, putting the effort in. So back to this situation, especially young couples.

or young people coming right out of this. I got this degree. It's such a huge accomplishment. I don't want it in any way downplay. And you think, okay, I just did all this work. And now what? Now what is I got to pay it off? Or else I'm going to be miserable.

And you can't just go, well, I applied to all these different places. I got a part-time pharmacy thing. No. Okay, I'm in. Now I got to go in. I got my foot in the door, but it's not a great gig. So now I've got to go work for other jobs to be able to take care of. my wife and I, who she's in grad school, like this is the reality. So I wish we again had an easy

fix, but we don't. Work the baby steps and working the baby steps. It's a simple process, but it is extremely difficult. Hard hats are required. nine experts and you'll get 10 different answers. Economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 42,000 businesses have future-proofed themselves with NetSuite by Oracle.

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You spend less time looking backward and more time focusing on what's next. And speaking of what's next, download the CFO's guide to AI and Machine Learning at netsuite.com slash Ramsey. It's free at netsuite.com slash Ramsey. all right are you staying on track with the baby steps if you'd like to know where you are how you're tracking take a quick quiz and you can check your progress and get a personalized plan to keep that momentum going you can head to our show notes and click on the link are you on track with the baby steps complete the quiz and it gives you a really fun update and some great inspiration Austin is now joining us in Florida. Austin. How can we help?

Hey, how are y'all doing? Well, we're having a blast today. What's going on with you? Good, good. Hey, listen, so I was up at the bank the other day, and I was just moving some money around and whatnot. I've been trying to get out of debt. I've been doing very good. Over the last 11 months, I paid off $22,000. Wow. Good job. Yeah, so I've been trying. I've got, you know, $8,900 left to go. go. I'll be completely debt-free. And the lady up there at the bank was telling me I need to get a credit card to get my credit score to have reoccurring payments on my credit so I can get a house because I'm looking, you know, in the next two years to get a house. And I've been working the Ramsey plan and I don't want to go for the credit. But I'm stuck right now because I'm so close to having a good credit score, opposed to having no credit score. So I need I need to talk to Jade.

You need to listen to Jade, not the nice lady at the bank. Yeah. The nice lady at the bank has ulterior motives, no matter how sweet and bubbly she was. And I can just picture her. She was probably just a sweet of sugar. And she probably had a lot of credibility because she swayed you a little bit. She kind of knocked you off balance a touch. So glad you called today.

And I would like you to never listen to that lady again. And I'd like you to listen to this lady. So with no further ado. take it away. She probably also had a set of assumptions that you would go to that bank to get the loan for your mortgage one of the time is. I think that's what she was doing. So she thought. Listen, you already know the answer, Austin. I can hear it in your voice. But for you and really more so for the benefit of folks listening, Austin, you know, if you've been hanging out with us for a little while, you know we teach all the time. The credit score is not

necessary. And I'll reiterate that with you again. I get it. Society teaches us this from a very young age, right? We're just bombarded with the message, right? Never leave home without it, right? And you're actually scared to leave home without your MasterCard, right? So I get it, but I like to remind people that

the only reason you're hearing that message so much is because there's money on the other end of it, you know, for businesses and for banks. What we teach is actually just as true. The truth is, yeah, you can have a great credit score and go buy a house. That is true. There's no falsehood to that.

But it's also true and just as true that you can have a zero credit score and go and buy a home. And America needs to know this, right? There are companies that do manual underwriting, which say, hey, we're not looking at a credit score. We're simply looking at how you manage your money. And that does exist. So in that way, having a zero credit score or an indeterminable credit score is the same. Really, it's better than having a good credit score because it doesn't have the stress and the debt attached to it. right and so that's how that happens you pay off all the debt and in six to eight months for some

people maybe 12 months your score rolls to zero which means we can't find it like i said before indeterminable and when that happens now is the time that's when you can strike right if you if your score hasn't rolled away yet and it's low yes you're going to have a problem but once it hits zero that's the sweet spot of when that happens and we would always recommend churchill mortgage to you. They do mortgages and the majority of the United States. So yeah, it could take a little due diligence. You hop on their website, do a little research, get connected with someone and start making your plan. And all they're going to want to know is what we're all kind of used to. They're going to want to know your pay stubs, right? Show us your pay stubs. They're going to want

to know, can you keep the job? How long have you been at, you know, getting paid? And maybe if you're, you know, a small business like Sam and I were, they might want to see your tax returns, your business tax returns. That's fine. And then they're going to want to see your trade lines. Have you been keeping up with your cell phone payment, your utility payment? And they want to see proof that you've been paying rent. And that's really important for folks who are living at home. Make sure there's some paper trail to show, hey, I've been paying rent on time. Even if it's to your parents, just make sure you're documenting that because that's really all you need. And then from there, it's basically the same process, Ken. That's right. Exactly right.

So this is a myth that she just busted and hope you get it, Austin. Stand strong. You're going stand strong and just smile and wave, like the penguins from Madagascar. When people hit you with these things, I mean, you know better, don't you? Yes, sir. All right. So you just got a master class. You don't need a credit score, do you, Austin? No, I do not. And that's just, I was stuck because I didn't know if I needed it, you know, within the next two years or not. You know. Another quick question. Okay. Another quick question. You got just a second.

Well, it's got to be fast. We got other people waiting. what's going on right the next question my bank so i don't really want to bank there but it's the closest one anywhere around where i'm living at and the fair winds is probably an hour and a half away from where i'm at what can i do with that what's causing you to go into the bank all the time because i feel like so like my my rent everything is cash all that's a cash deal right now why so to get to get just because the where it's at i'm i'm renting now some property and we pay the landlord cash so we're saving up to get out of debt so everything I don't know that you have to well I just I don't know why you have to pay cash I just I don't

understand that let's talk about that so if you're doing cash as some sort of an envelope system to try to just like keep your piles of money separate and manage it better that usually works better for things that you can easily pay cash for like growth or maybe gas or things like that. But I do find that things like rent or car payments, it is more convenient to pay for them online. So unless you're receiving like your income as cash and then you would have to deposit it in the bank anyway.

But if you're receiving your income as direct deposit, I would recommend keeping it as direct deposit. That way you can bank out an establishment that you feel good about and do most of it online. Yeah. And fair ones can take great care of you. I mean, I'd call them, call them and go, hey, I live an hour away. Just let them walk you through it. But I don't know that you have to do that.

I just personally, I know it's 2025, I just... Cash? You got a problem with cash, Ken? I don't have a problem with it, but pain, it just seems really inconvenient. When he started off the call, he's like, I was at the bank the other day, and I was moving my money around. I was like, did you go see, you know, the mercantile and get your eggs while you were there? It felt a very... The general store?

Yeah, it felt like, I'm not sure this is the best use of our time. Yeah, that's a good point. That's a good. Now, I do, I will say if you are on baby step two and you're really trying to be on it, I do love cash for that purpose. But again, just for, like, use it for the groceries. Small stuff. Yeah. For the budget buster things. Yeah. I'm not rolling up with a lot of cash. I don't know if I feel good about that. Yeah, that's, nothing fundamentally wrong with it. No, there's nothing. Well, his problem is there's no bank that he likes. And I'd love him to be with Fairwins. Yeah, I would too. And so, you know, if he's not having to drive. I can't remember the last time I had to go into the bank. I try at all costs not to go into the bank Yeah, they're never open Have you noticed that? Actually, they are more now than ever I feel like it used to be like On Saturdays they'd be closed

But now they're open On Saturdays? I think so The banks are open on Saturday Everybody's shaking their A lot of times it's like until noon or something Yeah, yeah Listen, I just remember the days

I'm definitely not going to the bank on a Saturday I promise you that right now There's too much football to be watched Especially this time of year, you know? No comment No comment I'm not, you know, I need to get into the football game. I haven't, let me, yeah, I mean, I can't even tell you.

Yeah, all right, very good. Anyway, the point is, that much cash, big transactions, a lot of cash. I just, you know, I don't know, I'd be careful. Rent feels like something you should pay online. Let's do it like that. Yeah, and it protects you. You know, the online, the banking for everyone's credit, you know, there's protections in using online banking, which I like.

Yeah. You know, and I'll tell you where I do like cash. when I'm buying a car for the kids. Oh, did you just slap it on there on the table? My favorite move is the accordion. What say you? I call it the accordion. I lay it out on the hood of the car that I'm offering.

That is gangster, Ken Coleman. I think it kind is. I'll receive that. Because you're making an offer, right? Oh, yeah, for a little. They're asking this. I don't want to pay this. You just silently put it out there?

So I pull out the envelope and I do this number and I just kind of count it out on the hood, trying under the guise of being accurate, but it's a hidden flex. Y'all don't know that, Ken. So, gee. I'm telling you. That's how I bought my last kid's car. Nice old lady, counted it out for it. Take it or leave it.

What is she going to do? An old lady. Make you an offer you can refuse. sleep and woke up groggy after tossing and turning all night. But now I look forward to bedtime and I wake up bright-eyed and bushy-tailed thanks to Casper, a company that's been perfecting better sleep for over a decade using durable, high-quality materials that actually last. My whole family now sleeps on Casper mattresses. Yes, even the dogs have their own Casper dog bed to no one's surprise. And it's not just one man's opinion. Casper customers keep their mattresses for years,

and four out of five customers recommend them to friends. And with free delivery, and 100-night trial, Casper is no gimmicks. A mattress you can trust, backed by quality that lasts. So go to casper.com slash Ramsey and use promo code Ramsey to receive 25% off all mattresses and 10% off everything else with Code Ramsey. That's casper.com slash Ramsey. Exclusions apply. Welcome back to The Ramsey Show in the Fair Winds Credit Union Studio, alongside Jade Warshaw. I'm Ken Coleman. Steve is now joining us in Columbia, South Carolina. Steve, how can we help today?

Yeah, hi, Ken. Hi, Jay. It's great to be speaking with you guys today. Yeah, I'm going to talk to you. So I've got a, I'm on the cusp of finalizing a divorce, and we came to a mediated settlement. And as part of it, basically, there's a 50-50 split of the 401K. But then I also have to come up with $100,000 in 90 days to buy her out of the house. And then additionally, there's $150K lump sum alim alimony payment over five years.

So kind of two questions is basically, how would you guys recommend coming with the $100K? Because I got some advice from the lawyers that I didn't really appreciate. And clearly they weren't part of the Ramsey program. And then treat the alimony payment going forward. I treat it as a debt in the baby steps or as like a line item in the budget going forward. Why don't we address that one first, Jay? Tell him about where that goes in the budget. The 150 over five years, have you calculated it out and seen what that looks like monthly?

Yeah, so about $2,500 a month. Can you afford that? And it fits, yeah. Okay, good. So, yeah, that's a line item on the budget. I would do it that way, especially if you can afford it. What's your income? about 180 a year

okay good it ends up being about like 8000 a month okay okay so the 100k and 90 days to buy out the house yeah why'd you agree to that

uh it's definitely definitely the house uh it's um in terms of everything else available in the area uh there's there's no way

I'd be getting anything close to this and um but i'm talking about the term the time like the time like do you have a hundred do you have a hundred thousand dollars yeah so that's exactly it i think i think it is a matter of kind of signing it and not really paying attention to that 90 days um i've got about 50 55 k in cash right now okay well that's a good start how much is your car worth uh so uh not much so it's a 2007 Subaru Forrester. So what happens if, let's come at this thing from another angle. Just, I'm trying to figure this out for you.

What happens if in 90 days you don't have 100K? What is the kick in in the contract? What, what, the agreement? So it's just part of the court order. So I think it'd be going, going back, back in front of the touch. Mm-hmm. I think that's your best bet. This was a, this was a bad negotiation on your part or on your lawyer's part because you don't,

you can't get the money at 90 days. And so when this goes back in front of the court, you need to have a better plan of what that is. Why not Selva? I was going to say the same thing. Well, the original thought was basically kind of part of the quadro from the rest of the 401K. So my half of the 401K used part of it to be able to pay her off. That was your plan? That was the original thought.

And then, again, the lawyers even suggested doing a home equity loan, which I flat out, just rejected. I thought that was a bad idea. Because you have to put yourself, you have to reverse the situation and say, if I were in any other setting, would I borrow from my 401k to buy a house? No, you wouldn't. Would I take out a personal loan, you know, to up the Annie on my house? No, you wouldn't. And that's the way I'm looking at it. I think that you either need to give yourself more time. If this is like something that you're like, I love this house. I don't want to give it up. never going to have a house like this again. You either need to give yourself more time. I mean, I've talked to people where there's years to come up with the money.

Not that I want you link to her for that long. Do you have kids? Adult kids. So she's in college now. Okay. So where's your ex going? She's just going to go rent somewhere? Starting a new career or another state. Okay. I'm going to come back to this because now again, I've never walked through this before. So Jade and I are kind of on the same page. I'm thinking about you could do maybe a cash out refi. I don't know if there's, because you have to take her name off it anyway. I would sell the house, and do you have any equity in it at all? Yeah, and that's basically what I'm buying out of.

How much equity do you have in the home? About $200,000 in equity. So why wouldn't you, I mean. I don't understand, given that equity stake that you have, this is just a house, and it's got a bunch of pain attached to it. you are single you got all this money that you're going to have to pay out over five years I personally and again I don't know what you think about this I do it a little differently I know I'm giving you another train of thought I'm not going to advocate for my point of view I'm going to say if it were me I'd sell the house if are there kids involved exactly what's been going in my brain

to sell it no no no no just back and forth I like you said. I like a clean start in this situation. There's that, but then there's also, I mean, you did make a good point earlier where you said with the market and when you bought this house, you might not be able to get something like that again. And I do feel that if emotionally, there's not the attachment that Ken and I think there might be and you want to keep the house. Yeah, standard is you would refi, get her name off of it, and then you would pull the cash out when you refi. And then she would get her portion. The only reason, and I kind of disagreed with Ken's sentiment initially is because the 100,000 is her money. It's not you giving 100,000 of your money. At this point, now that is her money because you're separate. So there's a different way to look at that. It's like, I'm just giving her her money. I'm not giving away my money, if that makes sense. Right. So that's, if you want to do the 90-day deal, that's how you would get it. But Ken has a good point. Do you really want to be in this house? house, or is it worth it to you to maybe get less house and have a fresh start? That's the question. Only you can answer that. Yeah. Or rent for a bit. I mean, your life's not over. So, yeah, I definitely know that starting over, but yep. Yeah, and it's not over. It's starting over. So there's a whole lot of new things coming your way. So again, I don't want to advocate for it. That may be too aggressive. How long were you married? You know. 20 years.

20 years. Oh, listen. Ken may have a point. The kids? Do you have kids? Yeah, remember they've got the... Oh, that's right, that's right. Is it just one? College, yeah. Just one. Ooh, yeah, you got your work cut out for you in terms of sentimental thoughts versus fresh start thoughts. I mean, you make a good income.

I've been working through those. You make, here's, I'm not advocating, but I am going to say, because I like when you push back. Yeah. So keep pushing on this. But in your shoes, if you sell this house, then you're able to pay her, her money. and have that done set aside put it away get it over with that's what i would do i would i would want a clean break if i could do it and i'm just looking at the numbers you're going to have to pay her uh a hundred thousand in 90 days and then you got 150 which is alimony over five years

um that's a lot of money coming out of your pocket it could be nice to have a smaller and i'm just saying i might rent for a year reset my life i don't think renting for 12 months is a bad idea for a guy in your shoes, get rid of the house, move on into a new chapter of life. And another, okay, I'm going to throw something else in there. And this is soon. So don't, don't be mad at me. But you'll move on at some point and meet another lovely lady. And do you want to bring her into that house? Or do you want to bring her into, you know, fresh start, Steve? Yes, and we'll see you about that one. Sure. I know I jumped ahead, but do you see what I'm saying? Like, there's, begin with with the end in mind is what I'm saying.

Yeah, I don't know. I don't know why I feel that way, but that's what I would do in that situation and just start fresh. You're not wrong, Ken. Start fresh. Get her to the $100,000. That's her money, to your point. And now work on the rest of it.

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you're a top contender. Go to Churchillmortgage.com to arm yourself with the ultimate home buying edge today. That's Churchillmortgage.com. This is a paid advertisement. Homebuyer edge and seller guarantee are available for qualifying borrowers and select loan types only and are not available in all six locations. NMLSID 1591, NMLS ConsumerExS.org, Equal Housing Lender. All right, let's get a Chris who's joining us now in North Carolina. Chris, how can we help today? Hey, how you doing? So, yeah, I got sick before COVID, and I was bedridden for three years and went to

financial problem real bad and lost my business had credit card debt go crazy and a couple years later now it's coming back to home me i just now was able to start working again literally two months in and i've got uh haven't been served yet but they're trying to serve me with judgment i don't have any assets before all this happened i turned my house over to my wife and my uh property number to daughter, so have no assets to worry about that. I guess my question is, should I go through with a bankruptcy before I meet the salary, yearly salary requirement to do so, or should I not do bankruptcy and wait to see what happens? Short answer is we're not doing the bankruptcy, but tell me, give us more context. What caused you to be sick for three years? Is that over and done, or can that

come back? It's possible. I had Lyme disease and I didn't know that I had it. I was undiagnosed. And then when I got COVID, it dropped my immune system enough to make both of them a problem. And by the time they found it, it went to my heart, my brain. And I had to be on a year of treatment. And I was still just about two years, I was completely better in.

And then just slowly started getting better. And your wife, did your wife leave you? in that time you said you left that gave her the house what does that mean no no no we're not legally married so um so we're uh so luckily for her she doesn't have to deal with that financial part now we've been together this whole time um so you're living with uh why did you call her your wife yeah i'm confused what's that why did you call her your wife and then just tell jay that you're not married? Well, I guess that what would you call a significant other than? A girlfriend. That would be the proper terminology. I just say wife. Okay. I'm not trying to, okay, I'm not trying to get too

technical. I didn't know if there was another part of the story that we needed to know about. So, okay, so you're significant other. You've been together a long time. Um, everything's in her name is what you're saying. So you literally legally have no assets. Correct. Okay. So you've just gotten back to work, what are you, what kind of work do you do now and what are you earning? So, a project manager, and it's $130,000 a year. Great. That's good news. And how much is the debt?

Definitely. I think it's like around $70,000, something like that. Okay. So first. Some is credit cards, some is loan. Okay. So first, your homework from me tonight anyway. is I want you to go and find out exactly how much you owe. I want you to have it written down

this much is credit cards, this much is medical, this much is, you know, personal loan. So you get a sense of what it is and the amounts because the way we're going to attack this is what we call the debt snowball where you list them smallest to largest and you pay minimum payments on everything and, you know, put it as part of your monthly budget. And then whatever money you have left in margin, which is your extra money, all the extra money goes to the smallest debt. So let's say you have a medical bill and one of them's only, you know, $800. You could essentially knock that $800 bill out in one shot. And then, you know, you just keep working through them like that.

So $130,000 can, that's great. That's a great income. I'm going to let you know right now what you've shown us, aside from the medical part, because that makes this feel very different. But the numbers alone, I mean, I want you to feel good in this case about being average because this is really just kind of your average debt scenario. You got $130,000 income. You're paying off $70. Yeah, you're going to have to live on not very much. Maybe you live on 80 to make this happen quickly, right? And the average person is out of debt in about two years,

two and a half years. So that's where you're going to be with this. And yeah, I got a couple questions, Chris, but are you tracking with Jade? Somewhat. What do you not get it? If you look at it. If you look at it. If you look at live on 80 that frees up 50,000. And I know taxes and all that, but do you see where I'm getting at? No, I understand that. I guess when you talk with two different attorneys, I'm getting, you know, three different opinions. I've got, you know, bankruptcy attorney saying, hey, do bankruptcy. Another bankruptcy telling me, don't do bankruptcy because you have no half that North Carolina, it's very rare for them to garnish your wages, if they can at all.

Uh-huh. So the worst you're going to deal with is judgments that may come back to haunt you. And we've got another bankruptcy attorney says, why wait, why wait until you make that $130,000? Because North Carolina, as soon as you hit that $50,000, you can't do Chapter 7. So why not do it now? Let me tell you my reason. Because you get all the dead behind you. My reason is when once you file bankruptcy, you're going to lose, you lose control over the situation.

Yes. And now a court says, here's what the judge. is here's what you have to pay a month here's what it is here's what we'll take you have no assets but it you said i'm saying you lose control over the situation and there's a there's an emotional component that's going to go along with that that says that it's basically you signing on the paper that says i lost control i'm not fit to handle this by myself here you guys take it that's going to take an emotional toll not only on you obviously it's going to decimate your credit i'm sure your credit's already bad but that's going to take seven years to fall off your credit so this is

going to haunt you when you can look at the situation and go, actually, there is some agency and some autonomy that you can take over this and you get to decide. You can say, you know what, I made a mess. And instead of losing your confidence, you can build your confidence up by cleaning it up one debt at a time. And that does something for you as well. When you take control of a situation and you clean it up and you make something wrong right, that's building something in you that at this time in your life you really, really, really need. Yeah. Listen, you. You You've been through it. Amen. Yes and amen to everything Jade said, Chris. And I agree with one of the bankruptcy lawyers that you shouldn't do this for all the reasons she just gave you. But the thing that I'm concerned about for you, you've had your life turned upside down. And man, I hate that for you. Man, I have so much compassion for you. But I think as it would anybody, Chris, it jaded you or it shaded some of your perceptions about what you should do.

The fact that you are living with a woman that you refer to as your wife and you signed a house over to her that you bought, am I understanding this correctly? Correct. Brother, that needs to change. Do you want to be with this woman the rest of your life? Yes or no? Oh, yeah, absolutely. Is there a reason why from her that you guys aren't married? Is it her or is it you?

well religiously we're married we went through all of that so i mean we're family all that we just didn't what do you mean what you got a marriage license what do you mean religiously you're married so we went through the ceremony but we never did a certificate so in north carolina technically we are married as far as you know north carolina when you're living with somebody for seven years you're leaving common law okay common law but as far as why not go down to the courthouse The IRS, the government, and all that. Hold on. Finish that sentence. I want to hear this reasoning really quick. The IRS, the government, finish that.

Yeah, as far as, you know, doing the marriage certificate and IRS and all that, in fact that we are, we file separately. We're separate. We're not legally married. Yeah, I get it. My point is you signed your house over to somebody, and I don't know where that falls in North Carolina, North Carolina law. I don't have time to figure that out on this little bit of a call, but that needs to get a lot of trust. Yeah, yeah. You need to get that. That needs to be fixed. Like, A, don't file bankruptcy. B, get the house back in your name, if that's even possible.

I guess. No, no, dude, this is not something to chuckle about. I don't think you get... No, I don't think you get help. The concern is what's going on now. The concern is what's going on now is that, you know, going out, you know, we've got credit card and bank. Yeah, Chris, the first thing...

When did you sign the house? When did you... Here's what I think you did. Here's what I think you did. And I'm not trying to make a bad situation worse, but I have a sense that you guys capitalized on the fact that you never got the marriage certificate when you saw that it was about to start pouring rain on your situation. And I think you transferred that house over to her name. I do too. And if you keep evading this, it is going to follow you.

You've got to deal with this. Dig out, bro. Stop trying to move stuff over here and move it over here and do the privacy. Just deal with it. We've seen people do this, Chris. And you've done all these kinds. of little maneuvers and you think it's funny. Hey, you call it us. I'm going to tell you something. What you're doing, there's nothing funny. It's scary.

If you've listened to me for more than five minutes, you know that being normal with your money is not a good thing because normal. is broke. And I want you to be weird. That's why I love what we're doing with Fair Wins credit union. Our friends at Fair Wins just launched a brand new Ramsey debit card. And it says debt is normal. Be weird. Right on the front. I love that. Because every time you swipe it, you're choosing to live differently with no credit card payments and no debt. You see, Fair Wins has been helping people like you ditch debt faster and build wealth for years. They're not trying to shove credit cards or auto loans in your face like the big banks do.

And they've worked with us to create the smart bundle for Ramsey fans. It includes a no-fee checking account, a high-yield savings account to supercharge your emergency fund, and now the Ramsey debit card to help you stay focused on the baby steps. We're excited for you to try it. So check them out today at fairwins.org slash Ramsey. That's fairwins.org slash Ramsey, insured by the NCUA. All right, our Ramsey Show question of the day is brought to you by Y Refi. Defaulted private student loans can drag on for years.

But YREFI helps borrowers explore custom refinancing with a low fixed rate and a payment you can actually manage. Go to yrefi.com slash Ramsey. That's the letter Y, R-E-F-Y.com slash Ramsey. Not available in all states. All right. Today's question comes from Chelsea in Idaho. She says, my daughter recently graduated. college and we will be traveling for the final step of a job interview soon. She's already passed the first three steps in the process. Is it ever okay to request your expenses be comped by the company you are applying to? She estimates the airfare, Uber, hotels, meals, and three days

of missed wages at her current job will run her roughly $1,000. This would make a huge impact on her monthly budget for a job she doesn't even have yet. Would it be inappropriate for for her to email the company and ask for reimbursement for at least some of these expenses? Yes, it would be wildly, wildly silly, not even inappropriate, just silly. You're guaranteeing she doesn't get the job. And Chelsea, I'm honored you sent the question to us, but the fact that you're asking us this concerns me. This is entitlement 101. You are not entitled to your expenses for applying to a job. If your money's tight, it's not that their fault. My goodness, grace. By the way, this is the world we live in where parents are showing up to job interviews. And then the kids

are complaining, Mom, it's going to cost me a thousand dollars. She goes, I'll tell you what, I'll email the Ramsey show people and see if that's appropriate. It's not appropriate. It's called the cost of living. I'm mildly irritated right now. Get all the way irritated. I want to see what happens. I don't want to. God bless you for the question, but no, please don't do that.

And explain to her why. I'm not sure you know why. It's not done. It's unreasonable. This is you trying to win the job and you're competing against other people. And you don't say, hey, this cost me $1,000 to travel here to apply. they're going to go, we don't care. And we don't want you here because you're too soft.

And you're already causing, you're already drama. Let me tell you, Ken, 101, when you're, this is just from being an entertainment. When I used to be an entertainment, my agent would say, just show up and do the job. Don't be drama. If you're a drama, you could be the best on stage, but if you're a drama, they'll never have you back. Like, just go, it could be the worst room ever and go, this is such a nice place. Thank you for having me. Everything is a graciousness, not, hey, you know, the M&Ms were a little bit, there were too many red ones in the dish.

Could you, that's what this is. There's too many red M&M's in my dish. And you got it. When opportunity knocks, Ken, you have to be ready to answer the door. That's on you. I just looked in the drawer over here. I thought maybe there'd be some tums. I got a little indigestion right here on that question.

Right there. You know what I'm talking about people in the lobby? You know what I'm talking about. It's going to be a little something there. She got it. Are you for real? She got the Tums right there. Lady, James, she just reached up with a bottle of Tums.

So fantastic. By the way, I do not endorse them. It's just a fun joke. All right. Jane is up in Washington. Jane, how can we help today? Hi. So about 10 years ago, we took the Financial Peace University, sold the SUV,

got a minivan instead and worked our way up to step number four life happened and we're back down at step number two with the number of emergencies that we have had in the last seven years I want to be stockpiling money I want to get that six months of income or of household needs saved up before we tackle the debt that we had to take on a couple years ago okay well Let's go ahead and head that idea off. That's never something that we would recommend, and Jay, to walk you through why. But let's first get a picture of where we are. So at one point, you were working the baby steps, and you got the baby step four.

And now all these emergencies, you're saying the emergencies are responsible for the debt. And if that's true, how much debt do you have now? We only have $9,000 in non-mortgage debt right now. Is that on a credit card? No, it's a personal line of credit for we had to have the siding replaced. A storm came through, damaged both our roof and our siding. You didn't have insurance? Hello?

It couldn't even occur to me to go through the insurance when we did this four years ago. The house was livable, but the roof was leaking, and the siding was damaged enough on one wall. Did somebody make... Are you sure, or did somebody make the decision and say, we don't want to submit this claim because we don't want our premium to go up? And so we'll just take out debt. So my husband and I are first time homeowners. Neither of our parents ever own their homes. And I guess in the discussion years ago when we were having that, maybe it was part of the, we didn't want the premiums to go up.

That feels right. But this was, yeah. So the $9,000 on a credit card is solely based on, you've mentioned several emergencies. Yeah, totally. So what emergencies are coming up in your life that have put you in a position where you believed that you had to do $9,000 worth of credit cards? Well, we had one child who was failure to thrive, and for two years I was unable to work, taking care of that baby. Okay. We have another child who is special needs.

So the one who is failure to thrive is doing fine now. Okay, great. But we do have one who has some special needs, and that impacts my ability to work. Okay. So we went from two incomes to one. Okay. What's your household income now? We're hoping to hit $100,000 next year this year.

My husband was right off this year, three months out of work. Okay. But with his new job, he'll be $100,000 next year, but not this year. Okay, great. And are you able to work outside the home? Not outside the home, no. Okay. I do some work online and bring home about $6,000 a year.

Okay. And so, okay, so I want to give Jade, I want Jade to answer the core question as to why we would not have you work on Babysept 3 ahead of Babyset. except two, which is only $9,000, and I know that may seem like a lot, but in the grand scheme of things, Jade, it's very doable. Yeah, so I just want to make sure it's just the two kids or are there more? Just too home now. Okay, two home. I think life has hit you with a lot, and because of that, it's kind of inflated the feeling of the debt more so than it is. You mentioned before that, you know, it took seven years, you know, you've been in this for seven years, And so I just feel like there's been a lot that's happened that much of it has not much to do with the debt, but it all kind of is conglomerated together in your mind.

Because when I look at this right now, I go, oh, $9,000 of debt, why isn't that gone in two months? Because if you do the budget, it's our household, our household needs are high enough that. Help me understand why, because what it sounds like is help me understand where that is. because what I'm hearing is in a generalized situation, rent is usually the highest or mortgage is the highest. And then the second highest thing if there's kids is some form of daycare. And usually those are the two that are kind of causing things to be really tight because your debt's not the problem. The $9,000 debt is not what's breaking you? Is there something more in the equation that you're not telling us about?

Are there cars? Is your mortgage a crazy amount of your take home pay? No, so food and medicine. say oh medicine and then yeah we have um certain medications you know insurance covered so much but yeah between food and we're not in any medical debt tell me right quick because we're tell me right quick because we're up against the clock and i'm sorry but tell me what you spend in medication and tell me what you spend on your mortgage we spend 1500 a month uh between food and medicine and 1200 a month on the mortgage okay this

This shouldn't be a problem. I think that you guys need to get on a really, really tight budget. I love that you know your numbers, but pay that $9,000 off. It's going to take you two to three months to do it and then stack up as much money as you want to to keep the big bad wolf away from your door. Hey, everybody, you need insurance. And nobody really likes digging into insurance, right? You know you need it. George does.

George kind of does. Outside of George, nobody does. But we know it's hard to, it's hard to figure this out. And that's why we have our Ramsey trusted insurance pros. And you're never going to deal with sleaziness, salespeople. We've vetted them. They're going to coach you up. Make sure you get what you need.

And you can find them by going to ramsysolutions.com slash coverage. Ramsey Solutions.com slash coverage. And you can connect with a Ramsey trusted agent. Or you can click on the link in our show notes. All right. Doug is up next in Connecticut. Doug, how can we help today? Hey, how are we doing today?

Good. How are you, sir? Excellent, excellent. Thanks for taking my call. I got two questions. The first one's a real simple, quick yes or no, I hope. Anyway, you know, Dave talks about doing 15% in retirement after you're completely debt-free besides the house. That 15% my company does a 5% match. So is that 15% like 10% that I put in plus the 5% is 15% or is it 15% and whatever the company matches is added on us basically? yeah typically we think of it as whatever the company adds is the added bonus and that's just the reasoning for that is if for some reason you went to another job and they didn't have that bonus you would still be in the rhythm of giving 15% of your income like that's just a great way to do it and since you're debt free except the house like if you wanted to go above 15% you could and I think it's a good idea if you do yeah totally yeah absolutely okay so the main question thank you very much appreciate that that answer a lot of questions

for me. Um, so the situation, FPU graduate 13 years ago. I just started listening to the podcast like two months ago and rediscovered Dave and I've listened every day. So love you guys. Thank you very much. Um, downloaded the every dollar app literally three weeks ago. Um, so my situation is this, uh, I have $23,000 in an emergency fund. That is my, uh, that's about five months of, uh, expenses right there, 280K in retirement, which I recently stopped, uh, contributing to. Um, I have zero credit card debt. I'm single. I don't have any kids. I make about 140 to 160 a year, take home. I take home about $6,500 to $9,000 a month, depending on the season. You know, winters are a little slower. I do have a mortgage,

but I sailed with the car. I got a car literally a year ago. Financed it. However, I got, I took a three-year loan on the car, and they were offering 0%. So I figured, oh, I'm going to beat these guys up because, you know, I got 0%, right? Now, payment is $1,000 a month, which is comfortable. I can get by, but I also get a $600 a month car allowance for more, right, to go towards basically whatever I want to put in my head. I'm thinking, yeah, $400 a month out of pocket, no sweat, it's all good. But like I said, 0%. I currently owe $26,000 on the car.

And with doing the every dollar budget app, I literally last month found an extra $140 of, you know, extra income. Great. which I already put towards the car. So I'm down. I want to get rid of this car. I just, with a 0% loan, I can't see how, and a lot of people can't see how it makes sense to take my money that I've been saving up $23,000 for the last,

God knows how many years it took me to get there. Sure. Why did it take you so long with this great income? Did you have, you're single, yes? Yeah, I have a girl friend, but yeah, single, yeah. But why did it take you so long? Or is this new, is this income new? I mean.

No, income's not new. I've been with the company about seven years, and I'd say the last couple years I've built my book of business. So, you know, definitely, you know, the income has been growing year after year. Okay. Yeah. And like I said, I just, I had a car that was paid for before I got into this car. But I'm 45 years old. I'm 6.3, 250 pounds.

So a nice little car is not doing it anymore. So I needed something a little bigger. So I went with the SUV, right? Wait a minute. Wait a minute. I've heard a lot of reasons for keeping a car. I think that's the, I think that's the, you act like you're an NBA player. You're not that big.

Yeah, I know. I think you like, listen, I think you like the fact that you got zero percent interest. I think you like the fact that your job is kicking in the $600 a month. And you're like, hey, what's the big deal? It's $400 a month. It's for three years. Do I really, Jade, have to, you know, Ken, do I really have to pay this thing off? And here, here's where I, I'm just going to tell you where I see risk.

Where I see the risk is if you got fired tomorrow, you'd be on the, the hook for a car loan and you'd be on the hook for the whole thousand dollars and i'm always going to tell you to go the path of least beneficial risk like there's times where risk could be beneficial right you there's a certain amount of risk that you take when you take out a home mortgage right but for the benefit outweighs the risk in this case there's risk there do you really need it is it going to affect you i think it could and i think that you could easily pay this thing off and just be like you know give the finger to the whole thing and just say, I don't need a payment at all.

I have money, buy, by, by Felicia, and just paid off. Yeah, and I agree. And at the end of the day, like I said, I just started the every dollar budget. So I'm sitting there like, if I could literally find an extra three, four, five, one, and I probably would have found more money, but I had two vacations last month.

So, yeah, at the end of the day, I could easily probably find an extra $5, six, seven, $800. Who knows, you know, at the end of this month and throw it towards the car. Now, well, let me tell you what I, I do. Let me tell you what I would do, Doug. I would go to my employer and I'd say, you guys are giving me the $600 bonus, which I really appreciate. I love this money. It's so helpful for me. I'm planning on paying off the car. I did the math and I found out that if you paid me the $600 over the entire length of this car payment, it would amount to X amount of dollars. Is there a way since if I, if I prove to you that I paid it off in full that you'll still give me that money as my stipend, that's what I would do. Does that, is that fair, Ken?

You're the... I'd want to do a little research before I took that proposal to them. Like, you know, there's probably a couple... Because if they're going to pay it anyway? Yeah, I just want to... Go ahead. Yeah, I'm saying the car allowance is more for like repairs, brakes, auto, because I drive my own car.

I put about 25 to 30,000 miles on the car a year outside sales tax. So they'll give it to you anyway. They give it to me... Oh, I'll give it anyway. Yeah, if I have no car payment, I'm getting that money for guard. So, Doug, you called us... I think we're talking all the way around this thing. Doug, we're dancing all around this thing.

You called to say, what? What was your question? Your core question. Should I empty my high-yield savings account, which is where my emergency fund is, where I'm getting 4% of interest on, and just basically dump it, maybe minus the $1,000 to keep my emergency fund. Yes. It's like you've listened to this show before, though. Yes.

Yes, Doug. How much do you have in your emergency fund? $23,000. And how much is to pay off the car in full? 26. Do it. Done. And then you build the emergency.

fund back up you've got a great income and you're single stop the vacations man you're living high on the hog buddy you know you could build you can build this you're golfing yeah like I mean listen that's the plan you empty it out you say up a thousand dollars so you're going to have $1,000 in there you're back to you see what I'm saying you pay the car off and now you're back to baby step three you get the three to six months and now you can go back to you know your vacation single guy and all that. This should be an easy fix for you. Easy fix.

So I agree. And it was one of those things where I've been, since I've been listening to you guys, like I said, I rediscovered the baby steps, rediscovered Dave. And I basically went from baby step one to three back to two. Listen,

you need to discover yourself without a car payment. Yeah. Yeah. You're playing a financial twister, you know. Right hand on red, you know, left foot on green. Uh-huh. No, we don't have a financial twister plan.

We have the baby step plan, and you just got to follow it. And here's the good news for you, Doug. Like, you have the means to do this immediately. Yeah. And now you've got yourself a paid for a car. How's that going to feel? That's a baller. Yeah, it's going to feel great.

And an unbelievable deal from your company that, like, I would take that $600 a month and stack that for any car replacement, anything. Oh, come on, give him that, give him that. My computer's dead. I want you to go to Ramsey Solutions.com. I want you to look at the investment calculator. And I want you to plug in. If you take that $600 and you just drop it in your investments for the next 20 years, what that's going to be.

And your mind is going to be blown. Dougie, Doug. No, 100%. Yeah. All right. I agree. There you go. Thank you very much.

Yeah. Thanks for the call. Don't overcomplicate it. You know, I hate to do this, but they're not my steps. Dave came up with them so I can refer to them and be kind of obnoxious about it. But, I mean, there's a reason why there's one. and then it leads to two and then it goes to three.

It's called a system. I mean, pretty simple stuff. But I love that. I'm going to give Doug, by the way, the Caller of the Day Award for the rationale of being 6-3, about 240. Is that what he said?

I'm like, are you trying to get a date or keep your car? What's going on here? He's like, I've got to get a bigger car because I can't just fold up like an accordion in this sedan. Like the guy's a tight, like he's an NFL tied in.

Come on, man. On that thing, I should be riding around on a bicycle. I'm a little guy. Many of you listen to the Ramsey show because you're sick and tired of getting nowhere with your money. You work too hard to live paycheck to paycheck with no money in the bank. But here's the deal. Just listening to the show won't change that. If you want different results, you have to do something different.

We've helped millions of people save money, ditch debt, and build wealth, and you can too. But you've got to have a game plan, and that begins with our get started assessment. Go to ramsysolutions.com slash start now, take the free quiz and get your free step-by-step action plan. If you've had it with money stress and are ready to take control of your money for good, go to ramsysolutions.com slash start now. Welcome back to the Ramsey show in the Fair Wins Credit Union Studios alongside Jade Warshaw. I'm Ken Coleman. And we're going to go to Matt, who's joining us now in Fort Worth, Texas. Matt, how can we help today?

Yes, sir. So as of this past Monday, I had a truck that I've been paying on for about two years. I had an auto loan for about $30,000 on it. I owe about $23,000 still on it, and the motor blew up. It's unfortunately just a bad design from general motors. They've had issues with this vehicle or these motors for a substantial amount of years at this point. And I am now fallen victim to said bad design. It would be about $15,000.

to have the motor replace, and I'm trying to decide what's my best option for it before I try to go trade it in and then it would be upside down on it. You owe 23? Yes, sir. If you get the motor fixed, if we could snap our fingers and it was just fixed today and it was paid off, is this a truck you'd be happy to drive for a while? And could you? the truck's in great condition other than that if the motor were to be fixed there is a company that sells a motor

that has the system that caused it to have this issue in the first place deleted and that's the option that I went and got quoted from when I talked to a shop do you have the $15,000 in cash I do not what do you have in cash I don't have much. My girlfriend just finished school, and I was basically the primary provider for about a year and a half with us. Whoa, whoa, whoa, whoa, whoa, whoa. How old are you?

About 30 years old. You're 30. Okay. You compliment to you. You sounded much over. You did. You did. Why are you the primary provider for your girlfriend? You guys aren't married. Is she 32? No, she will be younger than me. How old is he? She is

27. You really don't know how old she is? You had to think about that? That's kind of funny to me. That's a different issue. That's a whole other deal. Okay. Different show, different show, but I'm going to go ahead and tell you.

You probably need to be on top of that one. Okay, you should, so you need to come up with 15 grand. What do you make? I work in public safety. So last year, I made about $70,000. I'm probably on track to about the same this year.

And if you weren't helping provide for your girlfriend, it's just you, right? Just rent, or do you own a home? I mean, what's the situation there? No, it would just be renting my normal expenses. And I'm sorry for following up on this. Is she able to support herself now? Yes, she's working full-time again. She just started with the school year.

So she works as an American Sign Language interpreter, and she started interpreting with her school. Yeah. All right, Jade, I don't know where you're at on this, but there's a part of me that goes because he's already upset down in this. The trading option to me is just foolish. You're just not going to get anything at all. I'd rather see him working two, three, four jobs and come up with $15,000 to get that truck fixed. And then you got to swallow the pill and pay it off. But if the truck's in good shape other than this defect, and again, I'm giving you the answer on what I would do.

Well, yeah, I mean, if you roll out the numbers, if we looked it up and said, what could you get for this with the bad engine? I mean, what is it? What would you be your estimate? Do you have any idea? Yeah, I've been shopping around with a couple different dealerships. I reached out to GM recently because, or I'm sorry, GMC, because they have the highest reason. dates and stuff right now. And what they say?

GM would give me $9,000. Okay. And, and... I mean, because if you think about it like that, and then you add what you would have to kick in to cover the upside down, plus to get another vehicle, do you see what I'm saying? You're still shelling out $15,000. So that's kind of the numbers on it.

I can't see why you wouldn't just, at this point, I hate it, but, yeah, I don't think the numbers are good for you either way. So it's do you want to keep the car and pay the $15,000 or do you want to get out of the car and get another beater, which I don't think you do. I think you'd rather drive the more, the nicer car of the two if you can just get the money. I've tried that. You can't go into debt for this. I'll tell you that. Like if you end up, if you can't find the money and you end up having to go the other route of, you know.

Okay. Because here's the thing, if you do a personal loan to get from upside down, your numbers are going down. And I can advocate for that, right? I can advocate for you getting out of debt and then having to get a beater car and taking out a personal loan to do that, right? What I can't advocate for is you taking out a personal loan to keep a $23,000 car that you were already in debt for. Does that make sense? So if you can't come up with the money, you might be going down. But I'm sitting next to a person who, who with her husband, they had one car for how many years?

A decade. So where there's a will, there's a way. And what I'm saying is is figure out a way to get where you need to get. And I think you can come up with 15 grand pretty quick, a single guy who's able-bodied. Now you might have to stop taking care of your girlfriend. Oh, that's done. I'm already assuming because she's just your girlfriend. she's a grown woman

you got problems so taking care of her problems aren't isn't your problem you can't you can't you know in fact you guys have been playing house for apparently a long time anyway so no date nights no nothing you got to come up with 15 grand stat

did we lose you no I'm so there yeah it's a bitter pill to swallow But I just think the way Jade broke it down is great. And that just, again, we're always trying to answer things like, what would we do if you're in your shoes? If you can get the money without debt, yes, keep the car. To your point, it's going to be a great car when you get it fixed. But you can't, you can't do debt.

I can't let you take out $15,000 of debt and put it with a $23,000 debt. I can't let you do that. And you should say that to yourself too. And go back and listen to this call, right? don't come off this call and go, oh, I can't get $50,000. I'm just going to do it. Marinate on it because when you do, you're going to see, oh, man, the last thing I want to do is go from being $23,000 in debt, you know, to being $45,000 in debt.

That would be terrible. I agree completely. Are you stunned? Yeah, I've tried going that route. I just haven't been able to find a place. to be able to do that. I initially did attempt to contact my bank to try for a personal loan. Because other than the faulty design, I don't have an issue with the truck.

I enjoy the truck. I've been driving a truck for two years, and it's been great. So then what do you think your option is? Because you're either not getting the car fixed, or listen, your other option is take the time, however long it takes you to save up the $15,000, And in the meantime, you're taking the bus and you're riding your bike and you're getting Ubers and you're calling up Leroy to hit you up for a ride. Like, that's your option.

That's what I, that's what I think you've got to do. Yeah. I don't think he likes that option. I'm not even sure you heard that. I went through that painstakingly. I think it went in one ear and out the other. Listen, it's not fun. That's why.

It's not fun. You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage. To protect your biggest assets, I recommend using Ramsey trusted pros. Whether you're looking for car, home, or any other type of insurance, Ramsey trusted. providers have been coached and vetted to serve you like we would. Find what you need at ramsysolutions.com slash insurance. All right, folks, you've been paying attention to the news.

You know the Fed just cut the rates for the first time all year, and the 15-year fixed mortgage rates have dropped to the lowest we've seen in 11 months. If you're financially ready, now is a great time to buy or sell. Why? Some of you're going, Ken, I'd like to play the market. I'd like to see the rates come down. Can I just give you a little opinion here, a little off-the-talking points opinion? Yeah.

Thank you. Here's what can happen. If mortgage rates continue to have a slight drop, you're not going to see it, in my opinion, drop back down on the twos. But if you have a slight drop, here's what's going to happen. People are going to get back in the market. And as demand grows, guess what else is going to happen? House prices go back up. So for some of you are going, I'd like to see that rate drop.

I'm playing the rate game. And what you don't understand is as rates drop, housing prices will go back up. It is supply demand. So I'm not pushing you to buy right now. But even though these rates are elevated from where they were several years ago, I'm telling you, Jay, it's just supply demand and it never fails. Reminds me of a song. You're not going to get this one.

How to make it to the top just to see how they drop. Yep, nothing. No, nothing. Forrest Frank, no one? Oh, well, okay, never mind. She got it. Thank you. There's a lady in the audience that's clapping, Forrest Frank fan.

I'll be honest with you. I'm a little embarrassed. I'm not even sure who that is. That's okay. Is that bad, James? No, it's not bad. Okay. James knows everything about music. They overplay him in the church youth group, some kind of other.

Yeah. Oh, it's a Christian artist. It's a Christian artist. That's why I said it was a deep cut. Boy, oh boy. Listen, he's doing his thing. Good for him. It was a great analogy for your real estate.

So here's the point. Now might be the time to buy. Thank you, Jade. Folks, I never know any music reference. It's just, it's terrible. It was a deep cut, Ken. Yeah, I like that. But here's the point I'm making.

Now might be the best time from a home price situation to jump in or to sell. All right. So if that's you, on either side of that coin, you need a pro to help you. That's why we have our Ramsey trusted real estate agents that are standing by in locales all across the country, you can find one for free at ramsysolutions.com slash agents. That's plural ramsysolutions.com slash agents. All right, Julia is up in Bend, Oregon. Julia, how can we help today? Hi, I'm honored to speak with you both today.

Good to speak with you. What's going on? Thanks. I have a two-parter for you. I want to make sure first I'm like budgeting appropriately and putting the right amount towards debt, given my income. And then with some upcoming fertility treatments on the horizon, whether that should be kind of cash flowed or do like a mini-stork mode to stockpile some cash. I like this question. Tell us more. Okay, so let's see.

Debt, I just have $12,000 on the credit card. It's me and my husband, and that's the main thing we're trying to get through. next is a home equity line of credit, which, based on the amount, I'm putting that with our mortgage. Great. Okay. So luckily, it's not very much consumer debt. I just feel like we should be able to pay off more and just things come up every month, it seems like, that hinder our progress. What's you guys' income?

We make $144,000 gross and done taking home just under $8,000 a month. and what we've been able to do is rent out some rooms in our house and part of that HELOC was completing an ADU so that we can get some additional income. So we have about $3,300 coming in now just as of last month. In addition to the $8,000? I think that's going to be a big help. But yeah, that's all kind of new.

Okay, so what's the fertility treatments costing you? Are you cash flowing it currently or you haven't started yet? we've been cashrolling up to this point of it's just been like a five year journey unfortunately and we're finally at the time of like probably needing IVF or something okay um so what i'm looking at is my insurance thankfully covers up to $10,000 of assistance there but i have to meet my deductible of 3,000 so i'm assuming we're going to need more than that because IVF can obviously cost way more than $10,000. So I guess my question is, do I, sorry.

What's the top end? Like, if you were really, like, running it through, like, what's the most you could spend or that you would spend? Let me put it like that. I mean, I don't even know, because it looks like it varies by state, but it looked like in Oregon, maybe like 10 to 15, hopefully not more than 20. Okay. You know, my thought on this is if anybody else called in and said, hey, we're thinking

of having a baby and they became pregnant. Yeah, we would put them in stork mode. In your case, becoming pregnant is the cost ahead of time, right? Like, everybody else gets pregnant. Then the cost comes. Your cost comes ahead of time. So I would still treat it the same way. I'm not going to tell you to wait to pay off debt to try to get pregnant. But I will say it must be done in cash. I think that this is you going in on a bet and you don't want to go into. dead on that because that that could add insult to injury right of like three thousand so i guess that was my question like do i stack up that three grand so we at least know when we're ready to start we have that or just cash flow that as we go which i think we can do if you can cash flow it i would

cash flow it if you can do a little of both i think that's great if you can cash flow this fertility and keep paying off the 12 000 i think that's winning if you're finding that hey we literally don't have enough cash to do both of these. If you have to put less towards your snowball, that's fine. If you have to cause it to pause briefly for a couple of months, I think that that's fine, too, especially since you said, like, age-wise, you're getting to the end of this. I would do, I mean, if I were in your shoes trying to do what you're trying to do, I would do that. Ken?

Yeah, I agree. I agree. Yeah. I can't add anything to that at all. And I listen, can I just say, on a personal note, I was listening, And Stacey and I went through your journey, and it's really, really tough and, you know, just hang in there. And these days of uncertainty can really eat away at you. So certainly you understand where you're coming from.

But please don't make, and not to say that you're planning to, but don't ever let the emotion drive you to a poor financial decision to put you in a bad spot. You guys walk through all of that. And so I just wanted to add that one little. I can't add anything financial advice. But as hard as it is, I just believe there's a plan, and I believe you're going to be a mama one day. And that's all I want to leave you with. Thank you. Yeah.

Yeah, that's tough stuff. You know, these numbers, you know, just you look at the data out there. And I just feel like I'm supposed to say something about this, not just to her, but to our larger audience. You know, we see the infertility numbers continue to kind of move up. That needle is moving up in the United States. And, you know, there's nothing harder for young couples who want to start a family to have. that need, desire unmet, and it can be really tough. And so here's the point that I'm making. You can really rationalize, Jade, going into untold amount of debt to go my heart

longs to be a mom or a dad. And we're going to do whatever it takes. And you have a lot of people encourage you. And the reality is you just don't know how all that's going to play out. Yeah. There's no guarantee on these treatments. That's right. Except for the bill coming due. Yeah. You want it to end well, but it's sad when it doesn't.

That's exactly right. So here's what I want to encourage people that may be listening and watching in the situation. If that's the case, then I say go all in, but go all in and be able to pay cash for it. So sacrifice in other areas of your life. Right. Don't sacrifice your future on the altar of the immediate, where you want to do whatever it takes to become mom and dad. And I just would say, you know, sell the house, like change your living.

Like, okay, we're going to go backwards a little bit in every other of our life so that we can start a family. And it's a very tempting thing. And you know how tough emotionally. I'm sure you've walked that through with other ladies in your life and friends. We're all kind of touched by friends that have gone through it. Just please don't fall into that emotional trap. I agree. To where you can rationalize debt because it's going to make that existing pain.

even more painful. So tough stuff there. Julie, thanks for calling and sharing transparently with us. We're rooting for you here. You've got this. Hang in there. Better days are ahead. How many times do you end up with too much month at the end of the money? Even if you can cover the bills, there's nothing left over. You work your butt off and you still feel broke. That's normal for most people. But you do not have to live that way. You can completely transform your money and your life,

with every dollar. Our world-class budgeting app is better than ever. Now, every dollar coaches you to find extra margin every month so you can make real progress and change your family tree. The average person finds $3,015 in just the first 15 minutes. That's extra money. You can use to beat debt, to build wealth, to finally breathe again. Don't settle for living normal with money, start every dollar for free by downloading the app today. All right, let's go to William in Pennsylvania. William, how can we help you today? All right, so I got two questions.

So my main question is investments. Since I'm actually able to put money aside and save up a lot more, I'm wondering what places I can invest my money into for the best results in the long run. I'm very young, and I'm hoping to be able to have a lot more than just a 401k whenever it's time to hopefully retire if I'm ever able to. How old are you? 22. 22. And do you have any debt?

Yeah, I have a house and two vehicles. Wow. Oh, boy. Tell us about those first before we get into the investing. Okay, so last year I closed on my first home right before my 21st birthday. I moved in around September 3rd, I believe, was my moving date. Bottle the furniture outright, had the closing costs figured out, had the down payment figured out. And I owned three vehicles completely. I bought them all in cash. Great.

And once I figured out how much money I was making, It's not a lot, but for this area, it's quite a bit. What do you make? I was able to do, right now I make $27 an hour. Okay, and I appreciate all the timeline. Yeah, I get it. Yeah, for Southwestern PA, it's substantial. Okay, 27 bucks an hour is great.

But you said you have two car loans. How much of the car loans? Combined or like separate? Separate. You had two cars, two loans. So my first vehicle would be. my now wife's vehicle. We paid 15,000 for it, and I did have to get a loan for it. And I pay around 300 a month for it. So you owe 15 on that one? Just about. Okay. And then what do you owe on the

second car? So I just bought a truck about three weeks ago, and it was 23,000. I pay just under 400 a month for it. And what do you take home every month? From your job? Combined, we both take home around $6,000 a month. Okay. And what do you pay in your mortgage payment? My mortgage is 600. Wow, that's good. Okay. I'm afraid for you because

you're starting a trend of debt. A bad trend. Uh-huh. I understand that. I was told, and I just realized that a couple weeks ago. Okay. I'm glad that you're, and so you agree then, you're like, I can't keep going down this route, right? Oh, no, that's the last purchase I'll be making for a long time, if I ever do again.

Okay, I'm glad to hear you say that. So you started out with an investment question. I will get to that, I promise. Ken will make sure of it. But I did want to address the debt. So you do, if you've been hanging out with us for a while, you know, can we do say that you do need to be paying off your debts before you invest? And there's a lot of reasons behind that. Of course, yeah.

Right? And you want to make sure that when you do invest, you're able to invest an amount that's really going to move the needle for you and you have the fullness of your income at your disposal to do that. So step one is you and your wife getting together and saying how can we quickly tackle this $38,000 of debt using our $6,000 a month income so that we can regain $700 a month in payments, right? That's the first plan. So do you have every dollar? What do you mean every dollar? So every dollar? So every dollar is our budgeting app. It's really more than a budgeting app. It's giving you your whole financial

snapshot. Yeah. So you'll spend, I'll give it to you for free and you'll spend, you know, five minutes telling them your, telling the app your situation, and it's going to craft a plan specifically for you. And it's going to help you find the exact margin that you need to pay off this $37,000 of debt. Yeah. And as long as you follow the recommendations, I promise you're going to get there, because it's going to tell you exactly what Ken and I would tell you. you here in this room, which is, yeah, let's some small to largest start with the 15,000 one first, but it's going to look deeply into your budget

and find money that we can't see through the phone line. So that's step one. Now let's talk about your investing question. Ask it again, so I don't miss it. So I do have a 401K. That's obviously brand speaking new. But, you know, I don't want to just have to rely on that in 50 years from now if, you know,

if I'm even able to retire. Why? I don't want to just have that. What do you mean? Why? I'm trying to understand you. Why does that bother you to have a 401K? I just don't want that to be the only thing I settle with.

What do you want besides that? That's just a traditional retirement counselor. You want land? What do you want? I mean, I would love to buy land. I would absolutely love to. But I just, I knew everything. I just graduated almost five years ago.

That's true. You sound older than you are. You do. You're an old soul. I think Jade needs to give you, I'm going to have her walk you through the baby step plan and strategy so that you get this. And she can touch on the investing so that you see the big picture. I do want to, I'm actually going to go in the reverse order of what Ken said. She's going to do the reverse of what I said.

Reverse. Sounds like my marriage. My bad. All right. Stacey, here's what I think we should do. Oh, you don't. Okay, never mind. We'll do what you want to do.

Sorry, Ken. Listen. No, it's great. I'm sorry. No, keep going. It's great. Okay. Okay. So let's talk about the investment part first. So because you're not the only person with that question. So if you were saying to me, Jade, I want something other than a 401k because I want to be able to retire before 59 and a half. I'm with you. If you said, Jade, I just don't like the idea of all my eggs in one basket. Can I have something besides a 401k? I just love diversity. I would be right there with you. And I am. So yeah, once you have gone beyond a certain baby step, all of those things open up to you. And I want to talk about.

that. So to Ken's point, we talked about first, just save up at the, I'm going to walk you through the baby steps. First, just get a thousand dollars saved. Do you guys have any money saved anywhere? No, I, yeah, we just paid off the wedding. We just got married last weekend, actually, and after all that, I may have not done it the right way, but I did it. Everything is paid off. The only thing we owe is our debt now. Understood, but what do you have saved? And I have money in the bank. In the bank, I probably have around $4,000 to $5,000. That's like my, but my cushion is what I call.

call it is my cash. I keep in my bedroom. I have just under 10. Oh, okay. So you got $15,000 total. Excellent. That's just what you need. If I don't have money, I get nervous and I freak out. I need money. Okay. Well, I'm about to freak you out for a minute, but it's so that you can feel your best in the end. If I were in your shoes today, William, I would take 14 of that 15 and I would pay off your car. And I know, yeah, just like that. And I know I just like swept the knee right there. He's breaking out. I know.

The hives are, they're hitting his neck. I can see it on the other end. Yeah. I would do that because you, what's ultimately going to get you what you want is to free up this income. And the debt, that's just, it's like a, it's like a dead weight around your ankle, okay? And we got to clear that out. So if you did that today, right, and you cash flowed the other thousand, because I always want you to have a thousand. thousand dollars saved you need something you would have three hundred dollars freed up today immediately

and then you could take that and throw it at keep throwing it at the debts right and how quickly could you have that $23,000 car paid off right I could have that paid off like the middle of the next year maybe three quarters away in the summer hopefully if you both worked extra you can have it done by the end of this year uh yeah by the end of the year yeah 12 months yeah so and then you'd have that extra $700 and you and your wife could stack up, you know, three to six months of expenses. That's baby step three. And then after that, you're investing 15% of your income into your 401k. And 15% ain't too shabby.

Like if you keep that going, you know, and then after that, we would say, hey, now let's take, you know, take a moment and focus on putting a little extra aside for your kids. This is another form of investing. It's called a 529. You can throw a little in there, whatever you decide. and then you can say, okay, let's start paying off our house because we value real estate, right? You wanted that diversity. So you start paying off your house.

Most people who do this, William, pay their house off within seven to ten years. Yeah, I was hoping to pay it off in 15. Okay, okay. Great. I love that. If you do it in 15 years, again, love that for you. Now you've got a piece of real estate. Now you've got your 401K.

And then if you say, hey, I kind of like this land deal, let's keep saving up money and buy another piece of land. Or let's keep saving up money. and I want to open another type of investment account. I just want to open one that's not tied to retirement to where I can invest the money and get to it whenever I want. You can do that. It's called a brokerage account.

There's so many options for you, but you must walk through the steps in order to free up the income in order to do it. So that is the caveat. You need the income that you're now paying in payments. One step at a time, William. We believe in you. I'm going to be able to be.

Our scripture of the day comes from Deuteronomy 28 verse 12. The Lord will open to you his good treasure. The heavens, to give the rain to your land in its season and to bless all the work of your hand. You shall lend to many nations, but you shall not borrow. Our quote of the day, this is kind of scary from Stephen King. Oh, not a Stephen King fan, but I'll go ahead and read the quote. What separates the talented individual from the successful one, is a lot of hard work. Oh, well, that's not, well, the hard work is scary. That's the scary

part. I guess I should stipulate. I don't know him and don't have any, I just don't like scary stuff. I don't either. James, I'm that guy. When I'm in the movies with my wife and it's the previews and the horror comes up, I literally close my eyes. I do too. You do too? Listen, I don't want that stuff going in my brain. Thank you. I do too. And I haven't even, I haven't seen Shawshank Redemption, but he wrote Shawshank too. So he does, he has a lot of stuff outside the horror genre. I didn't, I did it. I didn't know that. I did not know that. I had him as just a horror guy, and that's why I had to Craig. I don't, no position against

it, I don't like his work. Let's put it that way. Other than Shawshake, which I didn't know, James. Yeah, that's good. That's good. Actually, now I'm second-guess. Oh, yeah, it's based on his novel. Yeah. Wow. That's a classic. James, pulling the feather out of his hat today. Very impressive. Jenna is up in New York.

Jenna, how can we help today? How you doing? I'm literally losing sleepover decision I have to make by tomorrow. Oh. And what I'm struggling with, is whether to give a friend $900 who hasn't responded to any of my calls or checks for like three years. And then she suddenly reached out, and she's literally begging me for help to pay off a storage unit lien that she says needs to be paid by four days from now.

And she said it holds all her worldly possessions. So I contacted the storage company directly today. And in doing so, I learned she actually owes double that amount. and I'm kind of uncomfortable with a variety of the details they gave me. But I could get the money, but it would be a financial hardship for me. But what I'm torn with is I'm feeling so guilty. No. What if this was me?

And because like what if this was me and like the way she worded it and stuff? And but at the same time, it would be a boundary, you know. Okay, Jenna. I love this. I love that you called us because you. you need somebody that's objective. Jade and I have zero feelings on this deal. So I'm going to ask you a couple of questions.

I was going to rewind. When she first requested the $900, what did your gut? What did your body? What did your brain say? Well, I just felt so sorry for her because she hasn't talked to me in three years. No, no, no. Stop, stop, stop. Let me re-ask the question to make sure you get what I'm asking.

About the $900 when she, if she had asked for nine, $9, what would your brain have said? What would your body have said? $9, yeah. Okay. If it was $90, what would your brain and your body have said? Yeah. Okay. When she asked for $900, don't tell me all these other things. What did your brain and body say when you processed $900? It was hard because I'm trying to follow some advice from you and pay off my mortgage.

Yes. And you just told us, that $900 is a hardship that would be brought on yourself to help somebody pay off a debt. And this somebody's not even in your life. They haven't even returned your calls. They haven't even had the common decency to return a text. This is a hard no from me. Jenna. But she did return.

She reached out three weeks ago and then I got the text two days ago. That's fine. That's fine. But can I ask you a question? If I said today, Jenna, it is your mission to go out into this world and earn $900. Could you do it? I think I could. Okay.

That's your answer. Because your friend can too. And the question I also have is, is this still your friend? Well, you know, we were close and she went through all these things for, you know, time's sake, I won't go through it. that she shared when she called me. And she says she's getting a contract in the middle of the month and that she would pay me back in 60 days. Kaibosh.

I'm going to put the kibosh on this right now because here is what I will say. If you decide, because this is your choice, if you decide to give her the money, you are giving it to her. You cannot lend her this money. You either give it to her out of the goodness of your heart and out of the detriment to your own budget and to your own life. or you don't do it at all. You cannot lend because if you lend, if you lend it to her, you are not helping her.

You're just moving the debt. And now you're straining an already strained relationship. That's why I called because I needed to hear you say that because I knew that's what you would say. Yes, ma'am. Listen, you didn't even tell us, nor do we need to know what are the other details that you found out from the storage facility. But it screams to me that you're not getting the full story from this fake friend. This is not a real friend, and I'm going to say it. Real friends don't.

I just feel very not generous. Well, Jenna, that's your problem on how you feel, because I can tell you, you're a generous person. The fact that you're even considering helping this fake friend tells me you're generous. But you've got to make a good decision for you. Not a good decision for her. Do you understand what I'm saying? Also, can I just throw out there? guilt and generosity don't live in the same house.

Like, they don't live in the same. You don't give out of guilt. You give out of the abundance of joy. I think she's manipulating you. This is a person who did not return your calls, did not return your text three weeks ago when she knew she had a problem on the horizon. She thought, hmm, I better hit Jenna up

and start acting friendly again. I think this smells, this stinks of manipulation. This is a fake friend. and I don't give nine cents to fake friends, much less $900. Yeah. Yeah, this is. Period. Really think about that, Jenna.

When you give, it should be out of a cheerful heart, not a guilty heart, not under compulsion, not under, oh, what are they going to think of me if I don't give? That is the exact. Matter of fact, I would say, wait until, if you are still thinking about it, wait until all those feelings dissipate. And then if you can really look at this and go, I am just so grateful to help my friend, I have the money, I feel joy about it, I feel good about it. Do not give with a guilty spirit. That is not generosity. That is guilt and shame. I got another thought just now.

Jenna, how much does she actually owe? It was 1800, right? Yeah, 1800. Why is she coming? And that's the rent. So that means they won't take a lien if she pays it by the 23rd of the month, but she told me Tuesday, but she still would owe lien fees and late fees. And then the first of the month, she has two units. She has a $900 payment and a $786 payment on the first of November.

So Jenna. So I don't feel like I'm helping her because if I give her this money, then it's where to get in the next money. Yes, Jenna. I wish you could see our studio audience. They are shaking their head. You just came into the light. you actually just you took you took us where I was trying to take you in other words the nine hundred dollars isn't even going to solve the problem and that tells me and I hate to say this jade but I'm old enough now do it to have lived enough life to know that she's hitting several people up for nine hundred dollars this stinks as my grandmother used to say to high heavens. There's an old phrase from the South. Jenna, this is bad news, and I am hoping to remove any unnecessary guilt. You are not a person who has done anything wrong, thus you should not

feel guilt. But you're such a kind person, Jenna. I just hear my mother say that's not Christ-like. Well, that's another problem. We're now arguing with our mother. All right. And, yeah. Who's probably no longer here. So listen. I guess I did need that non-objective opinion because I knew if I give her the money, it's not alone. I'll never see it again. I'm going to say a final word.

You don't even know if she's going to put it on the storage unit. I got a final word on this, Jenna. You know? The reason you feel guilt is because you think that not wanting to pay her is wrong. That's actually right. And I'm going to flip it on you and say that if you give her this $900, that's wrong. Entitlement, baby. It's stupid.

It's not. good management of your money. Therefore, Jenna, it would be wrong for you to give her $900. It's my best shot. Stand on business, Kim. Where's my hat? Where's your hat at? Oh, my goodness. Remember, folks, there's ultimately only one way to financial peace and has to walk daily with the Prince of Peace. Christ Jesus.