The Ramsey Show - If Your Money Plan Isn’t Working It's Time for a New One

Episode Date: September 10, 2024

📱Watch the full episode for free in the Ramsey Network app. Jade Warshaw & Ken Coleman answer your questions and discuss: "Should I sell my commercial building to pay off debt?" "My car is getting repossessed, what can I do?" "Balancing paying off a house and investing," "I was fired due to being a whistleblower," "Should a college degree be this grueling?" Support Our Sponsors: The Wellness Company: urgentcarekit.com/ramsey for 15% off medical emergency kit Zander Insurance: Go to zander.com or call 800-356-4282 for a fast and easy quote today. NetSuite: Free KPI checklist, visit netsuite.com/Ramsey BetterHelp: betterhelp.com/Delony to get 10% off your first month   Next Steps 📈 Investment Calculator 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 🚢 The Live Like No One Else Cruise is booking fast!  🏆 Set and actually reach your goals with the NEW 2025 Ramsey Goal Planner! Hurry—They sell out every year! ☂️ Get the right insurance without breaking the bank. 💵 Start your free budget today. Download the EveryDollar app! Listen to more from Ramsey Network 🎙️ The Ramsey Show   🧠 The Dr. John Delony Show 🍸 Smart Money Happy Hour 💡 The Rachel Cruze Show 💸 The Ramsey Show Highlights 💰 George Kamel 💼 The Ken Coleman Show 📈 EntreLeadership Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

This is the Ramsey Show. Welcome, America. This is where we help you win in your life, win with your money, win in your work, and win with your money, win in your work, and win with your relationships. 888-825-5225 is the phone number. 888-825-5225 will get you in on the conversation. I'm Ken Coleman, the fabulous, the incomparable, the stellar, the author of a very exciting book we'll talk about later in this hour. She is Jade Warshaw.

She is my friend. You know what I forgot to bring today? What? Forgot to bring my trophy. We'll talk more about that later. More about that later. Okay, let's get right to the phones. There's some trash talk a little bit later if you want to hang around. It's going to be a lot of fun. But we start with Robert in Hartford, Connecticut. Robert, how can we help today? Hi, sorry guys'm a little nervous so bear with me you're doing great um so i have a career-based question i took over a business basically running a tax business preparation and four years ago and i ultimately wanted to get my c, so you need to work under a CPA for a year.

And I found a CPA firm a year ago to take me on in New York, and I worked there for the year. So I technically have my full year of experience, and they're aware of that. And they brought me in to talk about that and the potential future, and that they've said things like, you know, we view you as a potential partner and things like that. And there's a path to that and whatnot. And I'm trying, I'm at a roadblock because this job would require me to give up my business if I was to continue working with them and become a partner in the future. But I'm also trying to figure out if I should just keep my business and because I am taking my CPA exams, I do have my years experience and should I just focus on growing that? So do you want to be a partner in someone else's firm or do you want to be your own boss?

We're looking 10, 15, 20 years from now. So I obviously would rather be my own boss. They're kind of trying to tell me things like being, which I have been for four years, a sole proprietor is, you know, you do a lot of work on your own. You don't have that other person there to bounce ideas off always. I obviously plan to expand the business, and it's not just going to be me. I just didn't know if, I mean, obviously, maybe it's less risky to join them. They are offering me to keep 10% of my top clientele as well. So what's the better financial situation? If you stay working for yourself or go to work for this firm?

Can I give you some numbers? Yes, that's what I'm looking for. Okay, sorry. The business nets about $50,000, but I only have to work three and a half months because it's tax season. This job, they hired me on for $55,000 a year salary, but that's because they have a deal with me where I work part-time during tax season. Okay, but what would partnership look like? What kind of financial windfall? Sorry, so that's the thing. They really won't give me any numbers. They're really looking for me to go to them with a number of what it would cost for all these things.

What are you doing in the other eight and a half months of the year when you're only working for three and a half months? I'm working here currently. With the firm that they've offered you to be the partner? Well, that's the thing. I don't think I would become a partner that day. No, no, I know that, but you're asking us, what should you do? And I'll be honest with you, I think you're confused. So instead of me trying to dig a little deeper, I'm going to switch gears on my tactics. When you called a few minutes ago, which way were you leaning? To probably keep my business and stick with that. Why? Because I get to be my own boss. I make the same money now working much less months. It could probably contribute more time to my business and us. And once I get my letters, CPA letters, I would like to think that business could expand more.

And long term, you want to work for yourself. Can I interject a question or just get clarity? Is the reason that you're only working tax season, is that because you don't have the CPA certification yet? But once you have the CPA certification, then you'll be able to work year round doing other books. For yourself. Yeah. Unfortunately, without the CPA, my client base is very specific.

Right. But you're getting it. Yes. And then you'll be able to do the whole gamut. Yeah, I should have my CPA by January. Got it. Okay, my opinion is, I'll see what Jade says, I think you need to not take the offer to eventually become partner.

I think you stay in whatever arrangement you have with them. I'm slightly confused, but I would work for myself and freelance and do whatever you're doing until you get your CPA license and work on building your business. I think that's what you want to do. And quite frankly, I think it's probably the better play for you financially. So for me, it's check, check. Jade? Yeah, 100%. Listen, I think it's weird that a firm is offering you a partnership. You don't have your CPA yet. They don't know what you can bring in revenue wise yet. Like they don't know anything about truly what you're bringing to the table. So that feels odd to me. Not to cut you off.

Okay. No, it's okay. Tell me. They are fully aware of my business. They're fully aware of everything. They won't give me those numbers. They're more so trying to say, what would it cost for you to stay with us? And we're basically promising down the line partner is what I'm trying to say. Sorry. It doesn't change my answer. Yeah, me either. It doesn't change my answer. I think that you have a lot, you've tapped into like 20% of your potential on your own. And once you get that CPA certification, once you get that license, you're going to be able to really see what this business can do. And I, it's worth it to me to pan that out and see,

you know, being your own boss, a few things rival that. Yeah. I think you keep the course you're on and be confident in it. That's where you want to be. Okay. Thank you. Sorry. Sorry if the question was silly. No, no, no, no, no, no, no. You're doing great. I just want to be able to make sure that I understand and that we understand which way you're coming to this thing, but I trust your gut. How about that? I trust your gut. I think you've got a good gut on this.

And so understand that the desire to build your own firm, I think you're already in a position to do that. The only way, Jade, I would have changed my advice in this situation for Robert would have been if the time spent with this firm would give him the necessary resources and or experience, intangibles, blah, blah, blah, blah, blah, to then set him up later to do his own thing. But the fact that he's already doing his own thing and all he's got to do is finish getting qualified. This is the get qualified stage. And the CPA license, once he's there, this is a no-brainer. And that's a really good business, by the way, to% to own, because there is, if you talk to anybody in the tax field, there's not enough people. Yeah. And, and so I, in this situation, Robert, we're on board, man, stay the course, be patient, um, and, and do your own thing, hang your own shingle,

which you already have stay with it. And I think you're going to be better off. So good stuff there. Love it. Love it. Love it. Love the soul, the the solopreneur who's going to then build a business, a small business that provides jobs, and it's what keeps this American economy going. It's a small business. Small business, small business, small business. Oh, boy. I appreciate your vote in November, folks.

Just kidding. All right, quick break. We'll be back with more of your calls. This is The Ramsey Show. You know my philosophy on planning and preparing. Being proactive is always better than being reactive. We have a provider we recommend that can help you stay prepared for unexpected medical situations. I have a medical emergency kit from the doctors at the Wellness Company.

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order 100 online in minutes then fill out the brief questionnaire in your email and your kit ships to your door. Visit UrgentCareKit.com slash Ramsey and use the promo code Ramsey for 15% off. That's promo code Ramsey at UrgentCareKit.com slash Ramsey. Welcome back to the Ramsey Show. I'm Ken Coleman. I'm joined by Jade Warshaw. We're here to answer your questions. 888-825-5225. Jade's our resident money expert today, and I'm the resident income expert. How about that?

Mo' money is my theme for you. Mo' money, mo' money, mo' money. Mo' meaning, right? More money, more meaning is what we're going for here. One of the keys, Jade, to being successful, we know this from research, is the people that you hang around with. Yep. If you aren't where you want to be in your life, I can do an inventory of family members and friends, acquaintances, the stuff you're reading, the stuff you're watching, and I will tell you that it's a direct impact. So speaking of tribe, you should, when you can, vacate. Vacation with people that are like-minded. Okay, now I see where you're going with this. You see where I'm going? Yes. And for all of you baby steppers out there, those of you that are in baby step four, five, six,

and seven, I think you need to be thinking about the live like no one else cruise. I like that. Because you're going to be thinking about the live like no one else cruise. I like that. Because you're going to be on this boat with Dave and Rachel and Jade and me and John Deloney and George Campbell, but you're going to be on this boat with a bunch of people who live the way you live, who believe in the value of debt-free living and making the most of your money. So that's my pitch on why you should join us uh and i just found out you don't even have to have a passport because we're going from uh

american port to american that's true and so some of you are thinking i don't have my passport you don't need it i just found that out although i'd bring it though i don't want to be locked up abroad without my passport i'm just telling you what i'm hearing i'm with you i'm bringing mine as well uh we're going to be in turks and c, St. Thomas, Puerto Rico, and the Bahamas. Every stop is stunning beaches. There is a pickleball court situation on the cruise ship. If you're a nut like I am, I will be on the pickleball court every day, literally holding court.

I will take no mercy on anyone. I play to win. You know this. He plays for keeps, Ken. I play to win. Beyond the Ramsey personalities, and Dave, you're going to see Trey Kennedy, comedian, Stephen Curtis Chapman, great award-winning musician, Manit Chauhan of the Food Network lore, Deanna Carter, Mrs. Strawberry Wine, country music star herself, and more. It's a seven-day cruise. March 22-29, 2025.

You don't want to miss this. 90% sold, so you better get on it. It's going to sell out probably this month. Go to RamseySolutions.com slash cruise. RamseySolutions.com slash cruise. Are you going to have your guns out? You know, I mean... Sun's out, guns out? Yeah, I mean, when I play pickleball in the sun,

I like to have no sleeves. The less hindrance for that forehand. You know what I'm talking about, when I come over the top. We definitely don't want any hindrance. No hindrance. No hindrance, Ken. Let's go to Cody now in Lincoln, Nebraska. Cody, how can we help today? Hi, guys. Thanks for taking my call.

You bet. What's up? So the reason I'm calling is my wife's 31, I'm 32. We own an event rental company that does pretty well. And three years ago, we purchased a commercial building and opened up an event venue. The process of doing that, we went into debt about $900,000 after the remodel. And then plus about another $150,000 to $200,000 to my in-laws. For what? For the remodel.

The commercial property, we had to do an extensive remodel on it to kind of make it how we wanted. And the in-laws gave you the money for it? For the extra. So we got a million dollar loan with, you know, and then on top of that was about another 150 from the in-laws. And that was three years ago and it's going all right. We're in year three and it's starting to pick up. you break even on all this that's why i'm calling um we're we're quickly finding out with this much debt it's it's difficult very difficult and you know i in reality i think it would be 15 years from now before we'd even get close to... The dream has become a nightmare.

A little bit, a little bit. It's still fun and we enjoy it. How much do you guys take home? What's your income, you and your wife, off of this business? You know, we have it set up where we can live off of... We're living fine. I don't know the exact number, but I would say anywhere from 100 to 120,000. Okay, why don't you know the exact number?

We probably should be a little better at this. We kind of just intertwine. Do you have any other income? Yeah, we know what's going on. You don't have a budget. You have no other income, but this is event business. The event venue and then our event rental decor, which the event rental side of it is probably making more money than what our event venue is. Okay, what does it make? So that will probably make about $250,000.

Bottom line? And that's probably, yeah, yes. That's not gross? That's a net number after all expenses? Yeah. Okay, so what happens to that money? When you net that profit out, where does that $250,000 go? That's our problem.

It's like we're making all this money and we're working super hard, and it's like, where does it go? No, profit is profit. Like, you're either reinvesting it or it's sitting somewhere in retained earnings or you're paying it back to yourself. If you're only paying yourself $150, then to Jade's point, where's the other $100? It goes into things like our AC unit. Just all the things you got to fix up on this building. It's a 100-year-old building.

Like it's great. Right, but that's not filtering. If you're doing your books the correct way, that would have already filtered through, and it would not be reflected in your net profit. That's the whole point. So is somebody managing your books, or are you doing it? No, we have an accountant that does it. She helps us through all this.

Something ain't right. I'm telling you right now. When was the last time you had a meeting with said accountant and she walked you through your actual books to the point that you could understand it? I mean, not about every tax season. Good Lord, man. I'll be honest with you.

I don't even think this is a profitable business. My guess is this thing is not profitable at all when we put both of them together. And, you know, we're not trying to listen. You're stressed up to your eyeballs. Clearly, you got a million dollars of debt and you don't know your numbers. So that right there is very, very stressful. But you got to you got to right the wrongs on this and you've got to get involved in what's going on with these numbers, because I would hate for you to think that your event business or the event rental side is earning money when it's really not. And I want you to

get with whoever's doing your taxes. I want you to get to with whoever is doing your books and make sure you understand this, because if you don't understand it, you need to work with people who are going to help you understand it. Because as long as you don't understand this, you don't know what's going on underneath the surface. You don't even really know if you can trust the person who's running your books because you can't look behind them and go, yeah, that looks right. Or yes, I get it. I understand. So there's a part of this where being in business for yourself, you do, to a certain extent, have to wear these hats where you can at least understand, right, Ken, the basics of your bookkeeping so that you know you're not getting cheated, so that you know if you're actually profitable or not. It's like trying to fly an airplane blind. Yeah, yeah. I mean, and you say you're having fun.

I don't disagree with all that. So, okay, we did a diagnosis. What's your question for us? Okay, so my question is we've had an appraisal done on our commercial property, and we could sell it for anywhere from about $2.75 million to $3.6 million. Dude, take it now. Like, list it now. Hang up with us now.

Take this briefcase and run. Are you kidding me? This is a get-out-of-jail-free card. They don't come along very often. Yeah. Take it. And that's what we card. They don't come along very often. Yeah. Take it. And that's what we thought. Well, there's no more thinking.

There needs to be some doing. If I'm you, I want Jade to weigh in on this. Jade, here's what I'm doing. I'm selling the building, but I'm going to keep the rental business. Yeah, I'm fine with that. I like that. Only if you get a really good bookkeeper like Jade is saying who's going to hold you accountable. Because you started, Cody, with just the event rental, right?

And then that was doing well. And so you guys were like, we're doing amazing. We're going to go rent this or buy this space. So that was the mistake when you went to buy the building was the mistake. So let's offload the mistake. You get your money back plus a million and some. And now you've got this really great income that you're running the business you always wanted to run and you know how to run. Now you don't have to buy a building because you know how to rent equipment.

So you can rent a building if you want to keep the event side of the business going. You can do that without having to be in massive debt. So my goodness, Cody, this is a good day for you. This is a sign from hallelujah on high. Wow. I mean, I just went from like, that was a two peps at AC call to now my tummy feels okay. I know. Feels okay. Listen, let us get a cut of that 2.7 million. Easy now. Jade wants a commission. This is the Ramsey Show. I've been doing this show for over 30 years and some of

the saddest calls I've taken are from situations that are completely preventable. Yeah. And what's so hard is I feel like one of those, especially the ones that I'm like, oh, it's terrible air, people that call in and their spouse has passed away suddenly and they don't have life insurance. When you have to think through how am I going to pay my bills in the middle of all that grief, like it's just, it is, it's terrible. So life insurance is the one thing, especially as a mom with three little kids that I'm like so big on for people to get because it's inexpensive. Zander is the place that Winston and I actually get all of our life insurance. And it doesn't cost much because Zander shops among a gazillion different companies. It doesn't cost much. You just have to admit that someday you're not going to be here.

You got to say it out loud and you got to say, I'm going to say I love you to my family by taking care of them and taking the time to put this stuff in place. The cost of stinking pizza. To get a free quote, call 800-356-4282. That's 800-356-4282 or go to zander.com. The Ramsey Show continues. Thrilled to have you with us. I'm Ken Coleman. Jade Warshaw is alongside. The phone number is 888-825-5225. Let's go to Nicole, who joins us in Memphis. Nicole, how can we help today? Hey, I was just trying to see if you guys could help me undo the mess that I'm in. I don't know if I'm cursed or what, but I'm in a lot of debt and I'm a single mom and I'll be close to retirement age shortly and I just, I don't know what to do.

Okay, how old are you? I'm 46. Okay, and what's going on? Tell us some more details. Okay. So last year, my goal was to own a home and I know about debt to income ratio and my highest debt would have been my car note, which was 772. Long story short with that, I ended up making a bad deal, end up at 615 still, but no gap insurance. Since then, the job that I had, I have now lost. I have a new job, but it's $3,800 less. That's a lot. It is. Per month? Less? Yes. And I'm struggling right now. I'm close to eviction.

I'm about to, I'm close to about to lose my car. So tell me, tell me what you're making now. I'm averaging about $1,200 to $1,400 a month. Barely making it. Oh man. Yeah. Okay. $1,200 to $1,400.

Tell us what your rent is. My rent right now is 980, but it's behind and I'm close to eviction. So it's about 2700 plus a 350 fee for their attorney fees. It's crazy. What do you do for a living? I'm a barber. And before that, when you were making the $3,800 more, what were you doing? I was still a barber. I was working at another barber shop and I was let go. What was the difference?

Is it just the way that they do it and they weren't, the old place was sending more clients your way? Tell us. I had more clients. I was still on the low end, but I was making weekly pay. This is only every two weeks, and I'm averaging about $500 every two weeks or a little over. And is it just a salary you get, or is it based on the number of heads you do? So it's basically 50% commission or $12 an hour, whichever the greater of the two. Okay. So yeah. Okay. The problem, the glaring issue here is the income. And this can't go on.

Because my thought here is if it's 50% commission or your base pay, then that means you're not making the commission, which means there's not enough people coming through which means essentially essentially you're kind of standing there like waiting for something to do right are you spending a lot of your day kind of standing around waiting right so what i did was what i was doing the first when i first started there i was like this makes no sense i can do lift rides right yeah to make up the short but now my car is breaking down and it's still not enough lift lift rides sometimes are not as great as it was when I started right um so it so it's it's not it's it's not coming in I tried to get an uh been applying for other jobs like what

nothing is coming through like I'm great at customer service and things like that I love barbering okay um I really do love it but I was trying to get an additional job like work at Amazon at night and it's hard to work at Amazon at night see six years ago I lost one of my kids and my other children were there and so what's happening is I have to kind of be at home with my younger daughter because she's feeling the repercussions of all of that. She's got a lot of mental issues, you know, going on trauma stuff. We've got, we've gone through, so I can't really leave her. Here's what I, and it's hard.

And that's the other reason why I've also lost jobs because I have to stop and go to school and it's heartbreaking. I really wish that I could get a job that was financially stable where I could be at my child's disposal. You know, I just put one through college. I just dropped her off at MTSU. And thank God she had a lot of scholarships, but I still have to pay a small amount for the next three months. That's right. I don't know where it's going to come from.

Well, let's look at this. Let's look at this. Okay, you love barbering, but right now barbering is not making you money um and for sure for certain i feel like you could go on what do you do are you a braider do you do so what do you do no i don't i don't do that part anymore i can do women's hair but i love i love cutting me okay okay okay so here's the thing i think barbering goes on the shelf for now because it's not making you money. Maybe you do it on the side and that's your side hustle, but it's not your main core income right now.

I want you to get a full-time day job. Go over to Target, go over to Walmart, go over to Wendy's, go over to Chick-fil-A, anything today, because you got to make a little bit more than what you're making now and then make barbering the thing that you do on the side on the weekends, early in the morning, if nightt times don't work for you that that's the only way

here's the thing the good news is you were earning a salary that was making your life run and making your household run so you know you can do it it's just a matter of filling in the puzzle to make sure we're putting the right pieces in to get that income. Let's talk about the car. So the car is not running. That's the only vehicle, correct? Yeah, it's running, but it needs work. Okay. What year is it and what's it worth? And what do you owe on it? It's a 2022 Volkswagen Tiguan. I owe about $29,000 since it went up. I was at $26,000, but since I refinanced, it's back up to $29,000. Okay, and what's it worth? Nothing? Probably not right now.

Okay, I want you to go. Your homework is to go on Kelley Blue Book and see what is it worth private sale. You're probably going to be upside down on it, possibly substantially, because I don't know what all you've done with this thing. But we may need to get out of this vehicle because it's costing you what six hundred dollars a month it's it's costing me 615 a month yes ma'am oh my gosh okay so yeah we're gonna have to sell this car eventually and probably what you're gonna end up doing um can if you have a minute if you look this thing

up maybe you can give me a ballpark on it but But by the time we get off this call, maybe we can give you a ballpark on it. But if I were you to get out of that $30,000, what other debt do you have? I have a $8,000 signature loan. Okay. I have some student loans, which I got to try to figure out how to get back because I was in a settlement. And for some reason, just tell me how much they are for the sake of the call it's like six thousand sixty thousand dollars sixty thousand back on yes it's 60k okay and they're federal it's not supposed to be on there they're federal uh they're federal loans yeah it was it was a one in a settlement that they were supposed to take that off. Oh, because the institution is no longer with us?

It's not. They've come back, but it's gone through a lot of stuff. They've been in the news and everything. How much of the $60,000 is that settlement? All of it. All of it. Okay, so you're going to have to do some due diligence on that and figure out what's going on with that because $60,000 is not a lot that you want to lollygag with. Okay.

What else? Is there anything besides that? No, just a $400 credit card that I was paying. All right. So this is an income issue. Nothing. And by the way, we're running short on time. Let's get her a session with one of our financial coaches as our gift, because there's a lot

to layer through here. But Nicole, you have got to come up with a situation with your daughter. Friends and family, it takes a village. I'm not betting against a single mama. I know you can find a way to get some care for your daughter. It's hard. It's really hard. I know it is, sweetheart.

But I'm telling you, I'm not betting against you, but you've got to get some help with your daughter. I know it is, sweetheart. But I'm telling you, I'm not betting against you, but you've got to get some help with your daughter. She's been through a lot. You've got to get some people around you who can be with her. We're in therapy, but it's not a lot. I mean, it's not a lot of help. I just... I know, but listen, I'm talking about people around you in your community. You have got to say, I need some help because you've got an income issue and the more you work if you were to get back up to thirty eight hundred dollars a month jade she can work her way out of 100 and so nicole all i'm saying is we're going to get you with one of our

financial coaches who's going to spend more time with you yeah but listen you've got to get more income and you've got to get a community around you who say you say look i need help with my daughter who's still going through this trauma over here i need some support because i'm mama bear and i gotta go make some money and the more money i make with our financial coach and we're gonna give you all the resources by the way so christian if she needs total money makeover uh every dollar everything give her everything we got christian's gonna take great care and listen if you don't i don't know if you go to church or not. I want you stepping foot inside of a church this Sunday.

I don't care what you believe. You need people around you who want to help you and love on you, and they will do just that. We're going to walk with you, Nicole. You're not on your own, but go get some income and watch this thing turn around. Hang on the line. We're going to take care of you. This is The Ramsey Show.

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at netsuite.com slash Ramsey. It's free at netsuite.com slash Ramsey. It's free at netsuite.com slash Ramsey. Welcome back to the Ramsey Show. I'm Ken Coleman, and Jade Warshaw is alongside 888-825-5225. That's the phone number to jump in. We'd love to hear from you, taking your money calls, your income-related calls today. Matthew is joining us in Houston, Texas. Matthew, how can we help? Hey, guys. How are you today? Good. How are you?

I'm good. Thank you. So I'm 25 years old, a career salesman. At the beginning of this year, I landed a new job, which I've been, you know, my income has grown drastically, and I'm closing on a house at the end of the month. And I just wanted to know, you know, at my age, I want to start investing early. I also want to be debt free. Is there a balance to investing, you know, post-tax dollars and paying off the home? Or should all of my excess cash just be going to the principal and, you know, I start investing once that's paid off because, you know, at my age, the value of the compound interest, if I start now, I feel could really pay off down the road. So I just wanted to get your thoughts on that. Yeah. I mean, I think it's a good question to have. And I think it's a question that a lot of people have. So you just

closed on this home. Let's make sure you're in the position to begin investing. Do you have three to six months of expenses saved? I do. Okay, great. And then at that point, you would be considered baby step four, which is you're investing 15% of your gross income every single month. Are you doing that? I haven't started. Well, I contribute to my company's's 401k plan but other than that i haven't i haven't started which is pre-tax but i haven't started investing any post-tax um money yet okay good so what what i would say is whatever you're doing now if you have if you have access to a match through that employer account i would invest up to that match. And you said it's an after tax? It's a pre-tax with my employers. So they match 3%. I'm contributing 6% right now. Okay. So I would do up to the match and then I would go over to a Roth IRA and I would go ahead and max something like that out. And then if you still have money left in

your 15% of contributions, then you could go back out and get as close to maxing out that 401k as possible. The goal here is again, for you to be investing 15% of your gross income. And most people do it on a monthly basis because, you know, you can kind of set it and forget it with your employer. And so that's what I would do. And then beyond the 15%, any money that you have extra, I would put it towards the paying off of the house. And so that's the way we teach at 25 years old. You're not married yet. You don't have any kids yet. So you can kind of forget for now about baby step five, because you don't have any kids. There's no 529 that you need to really add to. And so then for you, the next step is baby step six. You're putting extra money towards the house and you get to decide uh how

intentional you're going to be about that right you don't have to go crazy like you did with the other baby steps but you're a single guy you could probably you know make a lot of headway on that what do you owe on the house uh so around 450 460 okay i haven't even made my first mortgage payment yet yeah you said you closed here you haven't even closed yet right or you I haven't even made my first mortgage payment yet. Yeah. You said you closed here. You haven't even closed yet, right? I haven't closed yet. Right. Okay. Yeah. And so that's what I would advise you to do. That's what I did and that's what I do. Yeah. I'm going to agree with you. I mean, I love Jay's advice, follow it, but I just want to commend you. I love this. I love this mindset that you've got, man. You haven't even

made the first payment yet. You're calling and going, uh, what do I do first? You know, and, but we want you to be set up for the longterm and you're going to have no problem getting rid of the house payment. And the reason I suggested you going to the Roth right after the 3% is we want that 3% match. I mean, obviously that's free money, but then I love the Roth option for you because on down the line, you're going to want money that you have access to that you don't have to pay taxes on and that you don't have that required minimum distribution. And so that's why we would say that and then come back and you can fill up that 401k when you're done. What do you expect to make in the next 12 months? I'd say around $400,000. Wow, my son.

See, I've been wanting to ask that. I had to wait. I didn't want to interrupt. But I was going, I had a sense that he had jumped into a... Well, when he told us the amount on the house, I was like, wait a second. Yeah, yeah, yeah. So the only reason I ask that, again, this is all an exclamation point to what Jade said. I can't add anything to what she said on that.

With that kind of income, you're going to be fine. You're going to be more than fine. So you'll just follow the baby steps. And with that kind of income, man, it is going to be ridiculous. Okay. Have you gotten your hands on an investment calculator? I, so I was just going to mention, I took a look at the amortization schedule on the loan, and that really just kind of ticked me off. Sure. So I want to just get as— Let it tick you off, but go in order. Yeah.

You know what I mean? Right. Get your investment strategy, because with that kind of income, and what Jade's talking about with the investment calculator, it's one of her favorite things to do. It is. Are you running some numbers for him? I'm going to run a few numbers for him, my guy.

Because he's so upset about his loan, his mortgage, his amortization payment. We need to get his mind focused on this part of the advice. Okay. So then let's play a game. How much do you already have in retirement investments? Do you have any? Only maybe six or $7,000. Okay. I'll put 7,000 seven thousand in there all right and then let's say you contribute uh let's see sixty thousand a year so let's say five thousand a month all right and then we'll get you at ten ten percent rate of return because you make a lot of money dude if you don't do anything else from now until forever, like from now until 65, Oh,

actually hold on, hold on. Yeah. I was going to say, I accidentally put in the wrong retirement age, but it's actually worth noting. I put in 48. Like if you were to retire at 48,

you'd have 5.3 million. I thought I put in, I thought I put in 65. Let's put in 65 and see what it says. If you go till 65, I'm shook. Tell him the number. No, no, remind him what he's putting in every year. No, this is monthly.

Monthly. If you put in $5,000 a month because you make $400,000. Yeah, that's $60,000 a year. That's $60,000 a year at a 10% annual rate of return. You already have $7,000 there. If you do this from age 25, you said you're 25, right? Yeah, I'm 25.

Until age 65. You sitting down? Are you sitting down? Because I'm standing up. $31 million. $31 million. $31 million. That's crazy.

I had to put my pinky like like on austin powers yeah yeah so now you feel a little bit better i do i feel a lot better but you know and that's that's really why i called you guys because i know that you know if i start now by the time i'm you know 65 it's going to make a huge difference right and oh by the way and oh by the way that doesn't mean you aren't paying your house off. You're still paying the house off. Yeah. We didn't even talk about that. And we didn't even talk about the fact that this is you starting. Like this is not you at your full potential. You're still going up in the world. You're still on an upward trajectory. Man, I thought something

was wrong with my calculator. No, that's 15% of your income. And oh, by the way, after you budget all that, you are now making extra payments on the house. Oh yeah. And you'll pay the house off before he knows. So this isn't an either or, it's both and. That's the point of the exercise. Matthew, I'm happy that I know you. I'm happy I got to talk on the phone to you. Hey, check back in with us. Keep letting us know how this goes because so many people need to hear this. If you can get these things firing on all cylinders, even if you're not making 400,000 a year, if you're making 200,000 a year, what is possible when you get a hold of your finances so early is so amazing. And for anybody

listening, if you've never played with an investment calculator, I suggest we have a great one, ramseysolutions.com. You can check it out, or you can just Google Ramsey Investment Calculator, and it'll pop up. But start playing with those numbers to see what your life can be. And, I mean, that's motivating at the very least. Yeah, absolutely. Thanks for the call. Love the breakdown, Jay. That's always fun when we get into the numbers.

Because, you know, in his mind, he's like, I've got to pay that house off. I've got to pay that house off. It's like, no, it's both and. It's both and. It's not either or. And fun to run those numbers and boy that's a staggering number that is a staggering number and let me just and not many people make his money no they don't I want to at least call that early in life at 25 yeah be making 400k no this he's in a he's in the top one that's top one percent one person 100 so i just want to at least call that out but

let's also ken let's explain why we care so much about paying off the primary mortgage because at the end of the day yes we want you to have the compound interest but at the end of the day there is going to be a time where you do not work and you don't want to be making payments on a mortgage your mortgage is the biggest line item in your budget. You want that done and paid for by the time you're that age so that you can just live. Yeah, I totally, totally agree. There's a young man that's living like no one else. I promise you, he's going to be living like no one else and also giving like no one else. At a young age, by the way.

Great stuff. Good hour, Jade Warshaw. All right, that does it for this hour. There will be more Ramamsay show i promise do you ever feel like you're finally making progress towards your goals only to get quickly distracted by something else in your feed well that's why we created the ramsey network app your single source for content that keeps you motivated the Ramsey Network app is designed to keep you laser focused on reaching your goals. Loaded with over 7,000 hours of Ramsey shows,

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I'm Ken Coleman. Jade Warshaw is with me. 888-825-5225 is the phone number. I'm Ken Coleman. Jade Warshaw is with me. 888-825-5225. Let's get right to the phones. Doug is joining us in Dallas, Texas. Doug, how can we help today? Hi. Hi, Doug. Thanks for taking my call. You bet. Well, I guess I'm trying to figure out the next steps for my family economically. Had a change in employment status. Had a whistle blow in my last job after 10 years, unfortunately, and cost me my job. I had set my wife down before this happened to kind of explain what was going to take place.

Met with an attorney and made sure I knew kind of what was going to happen. And obviously it cost me my career and I've kind of been blackballed in the line of employment that I was in at the stage. I'm 55 this year, so I'm kind of running into some challenges with ageism and just kind of getting looked at, dealing with navigating AI. Okay, so let's dive in here. So what were you doing? What industry were you in and what role were you playing? I was in health insurance in the healthcare payer side and had been in the provider side for a number of years and moved over to the payer side.

And I was working in administrative services-only accounts. What does that mean? I understand those words, but I'm not sure I understand what that day-to-day looks like. So, um, I was on a, um, an account that was a public funded account, uh, taxpayer money, um, that was paying, um, on, uh, claims, uh, for public employees. Um, and so were you leading, were you leading a team? Yeah, I was in the leadership role. Okay, and is that just your classic management role?

Like if you described what you were doing day in and day out and you didn't tell me the specifics, you just told me how you were dealing with your team, would I know that you were in health insurance? Yeah. Oh, okay. I kind of thought you were going to answer that differently. It's why I led you into that one. The point is you are leading people, and you can lead people.

True or false? True. Doesn't matter to the industry, does it? Mostly health care. No, no, no. Let me ask it a different way. You can manage people. You know how to lead a team of people that has a very clear direction, and they have a very clear agenda attached to the direction. You know how to lead and manage people. You know how to lead a team of people that has a very clear direction,

and they have a very clear agenda attached to the direction. You know how to lead and manage people, true or false? Yes. Doesn't matter if it is in health care or not. You know how to lead a team. True. All right. That's where I'm going with this.

I don't know what to say, and I doubt Jade does either. We don't know the circumstances. There's no way for us to talk you through, well, you haven't been blackballed in the health care industry. don't know what to say, and I doubt Jade does either. We don't know the circumstances. There's no way for us to talk you through, well, you haven't been blackballed in the healthcare industry, or you're not dealing with ageism. There's really no way for us to counter that. And so what we've got to do is we assume that this is what's happening and then give you advice based on that. So first things first, and Jada will weigh in here in a second, I would say that you can lead. You have an extensive resume. You were 10 years with this one company. You can lead. You have transferable skills and transferable experience. And I would be looking throughout multiple industries. And the narrative

is, I was in healthcare for a long time, and I want to pivot. I want to pivot. And, and, and it doesn't matter what happened in the situation where you felt like you had to blow the whistle on somebody and it ended up backfiring on you. Uh, but you get a new chance. You're out of a bad situation. Sounds like to me. And so, uh, that's the issue that I would be focusing on is I can lead people. And so if I've got to go manage a Chick-fil-A or an Applebee's or I've got to manage in a technology field, there are transferable skills and experience. And that needs to be the narrative. Now, on the ageism issue, if ageism is happening, and I'm not saying that it isn't, but if it is, that's because you are playing the normal game, which is I'm going to go on LinkedIn, I'm going to go on all these company websites, and I'm just a profile. I'm a digital profile,

and they see how old I am, or I get in interviews where I don't have an edge, meaning I don't have a relationship. And so now I am compared against other people. What you've got to do is, and I'm going to give you my book, The Proximity Principle as a gift. You have got to leverage relationships in these companies that you're going to so that, and let's say I'm trying to get in a company and I know Jade works there, a company ABC. I got to go to Jade and say, Jade, listen, we've known each other for X amount of years. I'm going to apply. I'm going to do the online thing. In fact, I just submitted it today, but would you be willing to take my resume and would you hand it to this guy named Bart Jones?

You know, Bart over there, she goes, I know Bart. And she walks by Bart's office or his cube. And she puts a personal touch on it and says, I'm, I know this guy, Kenny just applied. He's a really good dude. Here's how I know him. Here's how long I've known him. And I think he's a viable candidate. I can vouch that he is not a wingnut or whatever. That's the game, Doug, that you've got to play.

Sure. I've leveraged on some relationships in different industries to get my resume in front of some people. And I've, I've restructured my resume a couple of times to get away from a linear presentation, to try to downplay the, the, you know, the, here's when I went to college, here's when I did this job, here's when I did that. I tell you what, I've got a template that we'll give you, Christian, let's give Doug my free templates. I've got six templates you can get at KenColeman.com.

But I've totally flipped the resume on its head years ago, and this thing's been really popular, and we just use common sense. I have no HR background at all, but we were like, let's try this. And it really works. I've had Fortune 100 employees email me and say, I got through the list because my resume looks totally different than everybody else's, And I'm not going to go through a breakdown of it for sake of time. But Doug, it starts off with who I know. That's the top of the resume. It says, Doug, whatever your last name is. And the first bold heading is who I know. And what you've got to do there in

order to fill that resume out is, is have a one or two or three or four or five degree connection to somebody in that company so you're making it custom for each you're customizing it for each and you're also or it might be industry specific so if you're going to get in the tech industry you go uh i know so and so who's uh a leader of programmers over at big name company and people start to go oh doug knows doug knows some people doug's connected. I'm saying try it. It only works if we're going to actually leverage. So here's my point, Doug. This is a numbers game. I'm trying to give you a pep talk here to go, I believe all those things happen to you or may be

happening to you, but that does not cancel you out. You can get hired. You will get hired. But you're going to have to be really, really intense. Like this is a, I am burning the ships moment. I'm going to keep going. I'm not going to just submit resumes and sit back and wait. I'm going to submit resumes where I've got a person in that building who's willing to submit that resume as well. I'm talking to anybody and everybody I know going, hey, I've been a leader for 10 years. I'm leaving my current company. I'll lead anywhere, anytime. And this becomes your full-time gig is spreading the word, talking about it. That's where opportunities

show up on our doorstep. But absent of that kind of intentionality and resilience, you're going to be calling us a year from now going, I've been trying to apply for jobs for a year. Nobody's paying attention to me. Yeah, I know. Because you're a ghost. Can't be a ghost. You've got to have gumption.

There's your theme. Look up the word gumption, Doug. There's your new theme word. This is The Ramsey Show. This show is sponsored by BetterHelp. This is the season for Halloween. It's October. We're wearing costumes and we're wearing masks. If you haven't started planning your costume yet, get on it. And while you're thinking about it, I want you to be honest. A lot of us hide ourselves. We hide our true selves behind costumes and masks all the time. We do this at work. We do this around our friends.

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Therapy is a place where you can be honest, where you can talk to somebody else and reflect and learn, and you can accept all the parts of yourself over time and start living an authentic life. Masks and costumes should be for Halloween parties, not for our emotions and our true selves. And if you're considering therapy, try calling my friends at BetterHelp. BetterHelp is 100% online therapy. You can talk with your therapist anywhere, so it's convenient for you and your schedule. Just fill out a short online survey and you'll be matched with a licensed therapist. Plus, you can switch therapist at any time for no additional cost. Take off the costumes and take off the mask with BetterHelp. Visit betterhelp.com slash DELONI to get 10% off your first month. That's BetterHelp.com slash DELONI.

Listen, the housing market is crazy. And if you've been on the internet, here's the sentiment. Affording a home is impossible and you're doomed to be a renter for the rest of your life. Right? Wrong. George Camel here. Listen, finding a home you love within your budget is possible. And I'm excited to help you get there with our brand new course, How to Buy a Home You Can

Actually Afford. From saving a down payment that fits your budget to making an offer that sellers can't resist, we'll cover it all. So if you're ready to seal the deal on the right home for you, take the course at ramsaysolutions.com slash course. That's ramsaysolutions.com slash course. Welcome back to The Ramsey Show show where we help you win with your money, win in your work and win in your relationships. 888-825-5225 is the phone number to jump in 888-825-5225. I'm Ken Coleman, my colleague and friend. Jade Warshaw is with me to take your calls. And by the way, she has got a very, very exciting announcement. I mean, you're holding something fresh. I'll take it from here, Ken.

What you got? I'm just kidding. It looks good. You know what? Today is the day, the official launch date of the Graduate Survival Guide. This is five mistakes you can't afford to make in college. And if you notice, the color is the same as my nail polish. I was going to point that out if you didn't.

Did you do that on purpose? Yes. They were like, this book needs to be Jade because when it comes to college and making mistakes in college, Jade knows a little something about that. Yes. And that is true. This book is literally crafted on the five biggest mistakes that I made

going from a senior in high school to a freshman in college. I love it. And so the book outlines five mistakes that I don't want your grad to make. Because if you're listening right now and you've got a college senior, if you're listening right now and you've got, I'm sorry, a high school senior, or if you've got a college freshman, this is for you. Yeah. Okay. So we're talking about... Great little book. Look at that. Look at this it looks good look at it's just practical the size is perfect it's like there's no jacket on it so it's like a journal you can just knock around on this you can put it in your backpack it's not

but it reads can it reads like a magazine see this is what the colors are super colorful it's just pay attention parents and grandparents, because this younger generation, this is how they read. This is how they read. It looks like social media. I was going to say, it looks like an Instagram post. It looks like Instagram. It looks like TikTok. And honestly, it reads like TikTok as well. And so I talk about student loans, Ken. I talk about credit cards and avoiding credit cards. I talk about dumb choices when you're, you know, you buy your first car note. So I talk about how to buy a car in cash. I talk about dumb choices when you buy your first car note. So I talk about how to buy a car in cash. I talk about what happens when you have no plan and you

don't have a budget. I talk about what happens when you have no money in college and the desperate things that you start to do. And so this is the guide. Here's the thing. Your kids might not listen to you, but they might listen to me. Right? I think so. I know my kids listen to you but they might listen to me right i think so i know my kids listen to you my kids hardly listen my kids don't even listen to me they're five years old but if my brother or sister tells them something they listen i agree because it's just another outside voice that they think is you're you're auntie jade i'm auntie jade i like that and that's how actually that's how i describe myself in the book uh ken i Ken, I did not know that. Yeah. I described myself as your younger, your older yet surprisingly young looking sister. I love that. I love how you described yourself. Yeah. And so this is the book. I want you guys to get this. It's out today.

Uh, I guys, I've been there. I went into, can, let me tell you the dumbest mistake I ever made. I want to know. I want to know. I had a full volleyball scholarship and a full academic presidential scholarship. And I still took out student loans. Why? Because they said, Jade, you need to live, right? Like you want to go to the homecoming game. You need to buy clothes. You need to buy groceries. You need a car. So you took out a loan just for the living expenses. Just to live. I took out a student loan. Okay. Here's dumb thing number two. I remembered hearing Dave Ramsey say, you buy a car in cash. Yeah. I took out a student loan okay here's dumb thing number two i remembered hearing dave ramsey say you buy a car in cash yeah i took out a student loan and called myself saving that money in cash and then bought a car and thought i was buying a cash car because i used actual cash to buy it but it was loan money

feels wrong that feels wrong but that's the kind of listen that's what goes on in the mind of an 18 and 19 and 20 year old we don't know we don't know yet and so i'm trying to get into their mind and tell people where to get it okay you can get on sale today it's on sale today go to the graduate survival guide you can get it at ramsey solutions.com store you can click the link in the description if you're listening on youtube or podcast or you can check out my instagram at jade warshaw you'll definitely find it there get it today this is the most important. If I had had this, I would have been a Scrooge McDuck by now. I would have had millions. I like the Scrooge McDuck reference. Very fantastic. By the way, if you're watching on YouTube and you understand what I'm about to say, if you're listening on the radio or via the podcast

or the Ramsey app, you're going to get, with buying this book, you're going to get a great suggestion of a nail color for all you ladies out there. It's a neutral. Because you are, I don't know that that color is neutral. Ken, I guarantee you it matches everything. Oh. It matches you. That's what that means? Yeah, it means it matches everything. Oh, I stand corrected. But that's one of the bonuses. The five mistakes, the five colors, the same as your nails. I'm going to call that lemon meringue. It's called lemon juice, Ken. Is it for real? Yes. Well, that's close. I mean, I'll be honest with you, way closer than I would have ever guessed. I thought you were going to make fun of

me for that. All right, good stuff. So there you go. RamseySolutions.com in the store to get the book right now. Fantastic. Can't wait for people to get that. It's a great gift that keeps on giving. Yes, it does. All right, Nicole is joining us now in Philadelphia, Pennsylvania. Nicole, how can we help? Hi, thanks for taking my call. You're probably going to think this is a stupid question. No. Speaking of college loans, should you take out, if you have the money for college, should you take out a loan for the sole purpose of helping your child establish credit, cycle score, and a repayment history? What do you think the answer to that is? Take a guess.

I think it's a dumb question. It's not a dumb question. I think the answer is don't take out the loan. Yeah. Survey says. Ding, ding, ding. Other question. Okay. I think the answer is don't take out the loan. Yeah. Survey says. Ding, ding, ding. This is my other question.

Okay. This is my other question. And I know Dave has talked about cycle scores and apartments. How easy or hard is it for someone to rent? I've never had to rent an apartment. So how easy or hard is it for someone to rent? I've never had to rent an apartment. So how easy or hard is it for someone, a college graduate, 25, 26? It's not hard.

To get their first whatever. It's not hard. Without a repayment history. It's not hard. You just have to do your due diligence. It's not going to be, it might not be the first apartment complex that you wander into, right? So there are some complexes that say

you have to have a credit score, but there's plenty that say you have to have a credit score but there's plenty that say you don't or if you're renting outside of an apartment if you're renting a house maybe he and a couple of buddies rent a house or they rent a you know a condo or they rent a townhouse something like that yeah you can definitely find it it's just going to require you to do like i said it's not going to be the first complex that you throw a rock at you might have to visit a couple of them and let them know. And just go in there with cash and say, listen, I've got cash for first and last months.

They might charge you a little bit extra. That's fine. Just go in with the money and you'll be fine. It's not that big of a deal. Okay. Got it? Yeah. Great questions.

No dumb questions. No dumb questions. And only dumb actions. Right? questions. And only dumb actions. Right? Yeah, okay. I'm with that. You know what I mean? Yeah.

We can all do dumb, and we all have. Most definitely. But to ask a question before doing something dumb does not make it a dumb question. Yeah. And especially with her question, because it was based on what she's been hearing. Oh, 100%. You know? Oh, yeah.

And she knew, by the way. Yeah. She knew. By the way, just a little nugget here. The reason I did that with Nicole is because I could immediately tell that Nicole had a lot of common sense. Yeah. And so I wanted to just illustrate before we weighed in on our opinion that our opinion is not based on expertise. It is based on common sense.

Okay. I'll go with that. I'm not saying you aren't an expert. I am not a self-proclaimed expert. Yeah. But you get my point. Yeah. It's not that we're smarter than anybody else. It's that all of our answers on this money stuff and work stuff, it's all common sense based. So if you apply some sense to the situation. Yes. In other words, if your gut's telling you this is probably a bad idea. Listen. It's a bad idea is all i'm getting at yeah you know and so many things that we get into financial troubles relationship troubles

professional troubles is where that little voice the red flag that feeling in our gut yes we were like i don't know that feel just feels, it's a feeling. Yeah. And now I'm going to get some other facts, and I'm going to get some other opinions, and I'm going to put them in a glass, and I'm going to stir them. Okay, yes.

You feel what's happening right here? Yeah, I feel what's happening. Keep going. And so then we talk ourselves out of the common sense feeling. And I'm going to give you a little bit of research on this, just so you don't think I'm nerding out. So I read a book written by a physicist and a neuroscientist, and they were talking about the gut feeling.

And they described a test that some world-class researchers did on grandmaster chess players. They put a heart monitor on them. What they found was before every fatal move in a chess match, the chess players' heart rate spiked, telling them not to do it. They did it anyway. So what was the point of the study? That gut feeling is attached to your actual brain. Don't ignore it. It's your body saying, stop, stop, override the brain. Some call it a still small voice.

There it is. So trust that common sense. You're sensing it. Believe it. All right. Quick break. More of your calls coming up. This is The Ramsey Show. Hey, guys, Rachel Cruz here. You know, some people think budgeting means they can't have any fun with money. And I know this because that was me. But the truth is, budgeting doesn't limit your freedom. It actually gives you freedom. A budget is simply telling your money where to go. And the best way to do this is with EveryDollar, my favorite budgeting app. It'll help you create a plan for your money that fits your lifestyle. So whether it's a spontaneous date night or an epic Disney cruise, budget for some fun. Download every dollar for free today. Welcome back to The Ramsey Show. I'm Ken Coleman and Jade Warshaw is alongside. We're here for you,

888-825-5225. Time for our Ramsey Show question of the day. It's brought to you by YRefi. YRefi refinances defaulted private student loans and builds a custom loan based on your ability to pay. Now you guys, private student loans are different than federal student loans like Sally Mae. So to learn more about this custom refinancing option and a lump sum payoff option that you could qualify for after 24 months, go to Y-Refi.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. It may not be available in all states. Okay, today's question comes from Aiden in Massachusetts. He says, I'm 20 and attend college to get my bachelor's in electrical and computing engineering. I took Ken's Get Clear assessment and engineering was one of the careers it suggested and it's the one I'm most passionate

about pursuing. I currently work part-time for a retail store, and thankfully they are paying for my degree at no cost to me. But as excited as I am about my future, I'm discouraged because I still live at home, and my job is not fulfilling at all. And on top of that, the process of getting my degree is a long and grueling process. Am I overthinking this,

or is this a thing most college students experience? I could use a pep talk. Okay, yes and yes. Yes, you're overthinking it and yes, this is normal for college students to go through this. There is a roller coaster where a college student first leaves the nest. Many are excited about it. Many are scared about it. So whatever that range of emotion is, that's the kind of the beginning, right? And then you get there. And for again, let's just leave it. Most people are kind of like, I'm on my own, living my best life. Mom and dad aren't breathing down my neck, telling me to clean my room, the whole nine yards. And then we start getting into classes

and you know depending on your situation you're going to deal with some hardship there very different ball game there sometimes it's a lot harder depending on the major uh you're on your own you don't have a bunch of study aids it's like oh hello i gotta be an adult then we start moving into um okay i know what i want to do and in this case he knows what he wants to do but he's looking at four years four years and to have this emotion um it's very normal are you overthinking it yes because all you're thinking about is the climb it's the climb thank you miley i'm sorry thank you miley Cyrus. That was actually perfect. What you're not thinking about is the destination. And so what has to happen is you have got to come up with a

mental approach to, I got to do what I have to do so that one day I can do what I want to do. And the only analogy that I could give here is a pep talk. I'm going to hand the baton to you, okay, for your locker room speech. When I to hand the baton to you okay for your locker room speech when I train for the half marathon and you're currently training for a marathon yeah um I hate to run unless I'm running in a game involving a ball and a victory and a pickleball paddle but the idea of just running I hate to run and so I remember in my training, Jade, early on that I figured it out and I would be approaching a long grade or a sizable hill. And that's where my hate of running voiced itself the most to the point where it was like, you're a grown man. What are you doing?

You could stop right now and walk home, crack open a beverage and watch TV. What are you doing? This is absurd. Yeah. And what I learned was, is what I'm describing here, I had a mindset for the short term and the long term. So you know what I started doing? You may laugh at this. What? I stopped looking at the top of the hill. That's genius. Once I knew the hill was there, I went, I got to get to the top of that hill,

and I'm going to feel better about myself. I'm going to gain endurance. It's going to be good for what I'm training for. But once I saw the top of the hill, I took my eyes off the hill, and I started looking at my feet. And I literally mentally just looked at one foot running against the next. And when I just looked at, there's one foot, there's another one. I'm just doing this right here. And all I'm looking at, there's one foot, there's another one. I'm just doing this right here.

And all I'm looking at, and occasionally I would glance up just to make sure I wasn't about to run into a parked car. But I never looked at the top of the grade anymore. And I'm going to say I think that's the approach. If you know that the degree is leading you in the field that you want to be in and you've got to get that degree, if that's the case here. So the pep talk is a glance at the destination to say that's what I'm aiming for but now I better focus on one week then the next week the next week before I know it a semester is over and before I know it I'm at the top of

that hill and I will tell you the moment adopted that, I had a much better mental approach to running hills. And I will also tell you that I started measuring, my pace didn't drop off as much. Because you stopped focusing on the thing that was freaking you out. Stopped going, good grief, I got to run to the top of that. And it was, nope, one foot, one foot. And I would say to myself, one foot, one foot, one foot. Because you can't have two thoughts at the same time that you know what can that's actually genius because that's that's a big part of this i agree with you 100 you can't look at the summit you have to look at where you're at in the moment and i mean

this is not going to sound very eloquent but it's the truth hard work is hard work like people say hard work like uh kind of like a euphemism like oh it's gonna take a lot of hard work i can't believe i gotta do that and then when you do it they're like why is this hard i'm like hard work is hard but you can't look at you can't look at like like ken said you can't jump to the finish line right like right now i have an app that you know does my training for me if i were to skip forward and look at a couple weeks from now my heart will start pounding it It's a great illustration. Because I'll be thinking, oh my gosh, there's no way I can run 20 miles. Right. Because right now I can't.

Right. But if I keep going day by day, by the time that day comes, I will be able to run 20 miles. So true. And so this guy, he's just got to look at it one day at a time, focus on the reward, focus on what it's going to build inside you. Because at the end of the day, you're going to get this degree and you're going to know how to do the things in the field that you need to know how to do. That's right.

And that's motivating. And for you right now, what is your personal, what's your personal why for this marathon? In other words, let's fast forward to race day. Yeah. And you're going to finish. Let's not even think about your time. My personal why? What's your why on this?

A couple of things. Number one, I started hearing a lot of people with a lot of money run marathons so you go i want some of that heck yeah and then i looked at dave and i said if dave ramsey ran a marathon i think he was what how old was he james like 40 in his 40s i think older than that yeah mid 40s i think i mean i'm four i'm exactly 40 and i'm like yeah if dave can run a marathon mom is going to run a marathon like no, no, for sure. And then the other thing is, there's been two things that have really been definers for me. One was when we paid off the 460,000 of debt. I was like, you can't tell me nothing like after this, like nobody can, don't try to tell me anything. Cause that just created a confidence. The second thing was when

I had my two babies, I was like, now you really can't tell me nothing that's tough and now i'm like if i can run this marathon mentally that just it's a toughness that i want have you have you uh because you've done halves before yes so it's not like your first time but this is the longest and the most grueling workout 26.2 miles are you hitting are you experiencing that halfway mark where you start to hate yourself not yet question your your reason for living no not yet last week last weekend i ran 13 miles this weekend i'll run 15 miles and for me and i don't know maybe i'm crazy but for me this is like yes like i am like full dragon ball z like powering up mode

right now. Like I am feeling great. But you're telling me in the middle of the 13 mile run, you're saying I didn't, I didn't hit a moment where I had to press through. I have hit those moments, but Ken, you said it and it is so true. What you say to yourself, you can only have one thought at a time. That is so good. Because when I'm running, if you could hear my brain, in my brain, I'm i'm like come on jade like you're a freaking boss jade like you got this like you have to talk to yourself like that because there's nobody else yeah to say it yeah when i'm running i'm by myself 15 miles coming up this weekend yeah well you want to do you want to do it ken i'll i'll zip along beside you on a bicycle. I mean, I exercise, but I keep mine to short pivots.

Ken Coleman is in shape. Let me brag on you. And I know you guys, you want us to talk about money. I play pickleball. Mindset. I play pickleball with Ken. And Ken, I'm saying this in your favor. Okay.

Ken is older than me and older than a lot of the other players. He has more years on us. I'm the oldest Ramsey personality. I can handle it. But Ken dominated the courts. Let me just tell him. Ken had on his sweatband

and his bad guy hair was in his face. That's true. And he won. That's true. He was in shape before all of us. I was like, oh my gosh.

The thing I'm most proud of is how long I can play pickleball for. I can play for three hours gosh. The thing I'm most proud of is how long I can play pickleball for. I can play for three hours and I can keep going. Ken wanted to keep playing after the pickleball tournament was over. Everybody else is exhausted.

They needed lunch. We needed a margarita. I'll tell you what I needed. I needed more competition. Feed me. He eats competition for breakfast. Feed me more competitors. I'm a gladiator with a paddle.

This is The Ramsey Show. Hey, guys. Dave Ramsey here, and I got a big announcement. I'm coming to a city near you live on the Money and Relationships Tour with Dr. John Deloney. This is the most interactive event we've ever done. You get to decide what we talk about. You do not want to miss this.

We'll be coming to Louisville, Durham, Atlanta, Phoenix, Fort Worth, and Kansas City in April and May of 2025. Get your tickets and more information at ramseysolutions.com slash tour. Welcome back to the Ramsey Show, where we help you win with your money, win in your work, and win with your relationships. So, hey, we're about ready to get back to the phones, but I want to let those of you know that are listening via radio, we're going to continue with you after this segment. But for those watching on YouTube and listening via the podcast app that you prefer,

this will be our last segment unless you move over to the Ramsey Network app. That's where you get the full episodes, the full three hours, the only place you can get it unless you are listening on radio. So just wanted to let you know that. And again, you can check out the Ramsey Network app in the App Store or on Google Play. So check that out so you can get the full show. We got some great calls lined up for the rest of today. What's Google Play? Google Play. Just kidding. Listen to me struggle. I was like, well, it's a... Alright. Andrew's joining us now in Toronto, Ohio. Andrew, how can we help today?

Hi, thank you very much for taking my call. I actually live in Canada, where everything is quite a long ways away. I live in the northern region of Canada, and I drive about 7,000 to 8,000 kilometers per month. And I was wondering, should I be looking at maybe leasing an electric vehicle or keeping my current gas SUV? Okay. Is there anything you want to add to that? You seem like you're going to say something else. I was just going to say, because the amount I spend in gas each month is roughly $200 less than a electric car lease with the extra kilometers for 80,000 per year.

So that's why I thought, and I'm usually very against leasing, but I thought, I don't know, is this the one time that there's an exception here? I'm not 100% sure. Well, I think there's two, it sounds like there's two issues here. One is the affordability of your gas and if you want to lower your gas bill. And the other issue is if you choose to change vehicles, can you afford it? And do you have the cash to buy the vehicle? So let's look at it kind of separately for that purpose. First off, for your gas SUV, what are you spending now?

How many dollars are you spending a month to fill it up and do all that? About $1,280. So that's the average in the past three months I looked at. Okay. And you're saying that with an electric vehicle, you could lower that by $200? No. So the electric vehicle, because leases usually only go to 24,000 kilometers here in Canada. So buying the extra kilometers, which is 8 cents a kilometer, totals me about 1400 ish per month for leasing on a two-year lease. And the reason is because I'm assuming there's no residual value left in the electric car. And if there is, it'd be small.

So the warranty is for 160,000 kilometers. And I thought, well, I'll probably reach that within two years. So, you know, leasing it over two years then here's the keys and i don't have to deal with the speculation on how consumers are going to perceive the value of the electric car once it's done here's the thing i'm never going to advise you to lease a vehicle and i'm never going to advise you to go into a car note for a vehicle for the lease i'm not going to suggest that because it truly is the most expensive way that you could possibly operate a vehicle. Even though you're like, hey, it's electric.

There's rebates that I'm going to get, all that. When you do the math on how the payment is, how they come to the conclusion of the payment, you're going to realize, oh, my gosh, this is the most. And I can go over that in a minute. What I would do if I were you, it kind of feels like you're going from one extreme to another. You've got the electric vehicle on this end, but then you've got a gas SUV on this end. What if you had a gasoline car

that wasn't guzzling as much gas? What if you did that? So I would kind of advise you to look at your options, but at the end of the day, what's really gonna inform this is how much money you have. Do you have money to spend on a new vehicle? And that's really where my mind is.

So I own my current vehicle. And yes, I do. I actually teach corporate finance, of all things. But yeah, I have enough to, you know, if I was to go into a dealership and comfortably buy a vehicle, I was going to buy a lot instead. But, you know, if I have to buy a car with it, that's no issue. But honestly, my current vehicle is fine. It has a lot of life left to it. You know, it's just more of, you know, the fact that, you know, there's a depreciation expense, right? And there's a gas expense. And by the way, when you lease a car, the depreciation is built into the price of the lease.

Like that's built in. So you're not avoiding that. No, what I am saying is, you know, if I could buy the electric car in cash, except the car salesman said, once they're out of warranty, they're really only worth, you know, maybe, you know, 15 or 20,000, you know, in residual value. And he gave an example because he had one that he recently had to buy. And he said it's because consumers don't realize you can, you know,

maybe replace the battery. But, you know, still, it's kind of early. And so, yeah, I mean, to your point, to your point, we are saying, I mean, we're getting more and more people calling in saying I bought an electric vehicle. It's now barely a year later and the value has gone down substantially. So there are issues there. I'm not necessarily saying that I'm in favor of you having an electric vehicle. You're just saying, hey, this is what I want. What I'm simply saying is if you decide to do that, I would buy it outright and I would buy it used. I would not lease it. So that would be my advice to you. I mean, you're grown, so you'll probably go away from here and you'll do what you choose to do, but that would be my advice. Okay, and I'm going to stick with my gas card then.

The only incentive I thought was the lease payment was cheaper than the gas, but you know what, the way that you... But I don't understand. I don't understand why not even maybe try to come to the States and get a used electric car. That's what I'm thinking. Would they be under warranty, though, right? And how long do those electric car batteries last in lifetime?

You're asking the wrong cat because I don't want an electric car ever. I'm a classic car guy. In fact, the older the car, the better for me. So I'm just being honest. I don't know. I'm asking you. So you came at us with a lease. About 200,000 kilometers. And then they have like a, you have to pay 20,000 for a new battery to

install. Yeah. And Andrew. Okay, good. So, so in my asking that you've given yourself another, an answer as to why it's not a good play for electric cars in general. And there's another part of this with the amount that you're driving. And I don't know i don't have an electric vehicle i only talk to the only person i know who has one which is george and the few calls that come in here about them uh is the charging like there's more to the charging than meets the eye there's the time yeah and then if you want to do the quick charge that costs more you know what's the battery cost for my gas car why would you buy something? Here's what, and I'm not even, Andrew, I don't even know why anyone would buy an electric

car based on what you just told me. Because it's like once the battery goes. That's that. And you have to know where you can charge it. You're driving long distances. Can it make that distance? Like how many trips can you make per charge? That's the way my brain is thinking.

That feels like a headache to me. So as they say on Shark Tank, for that reason, I'm out. Yeah. I love that. And that means I'm out too. So I was leaning towards keeping the car, but I, the math was going the one way. I'm like, ah, this can't be true. Let's call it a Ramsey show. But I'm glad you guys agree. You know, as a society, we really don't know enough about these cars to make a car. Is your car, are you using your car for your own business, or do you work for someone else and it requires you to do all this driving? My own business. So you do write that, you write off all those expenses,

or at least every expense that you can, I mean, on the car. So that's at least a positive, you know. There's some breaks there about running that through your business, but, I mean, that's car so that's that's at least a positive you know uh there's some breaks there about running that through your business but i mean that that's just that's what it is man and uh that's the nature of what you're doing so you got to build into that you know my retainerings on a business like that would be like car replacement 100 i'd have a line item on that yeah are you doing that andrew uh no, I usually include travel in with my consulting practice that I have. I usually include travel in the price that I give for the engagement, but maybe charging

the service might be a better idea. Well, no, it's great. But what I'm saying is, Jade, you're with me. If you're going to do that, I would put all that money into a car replacement fund. It is a huge part of your business, my friend. I see what you're saying. Like you should be putting, well, let's just run this through. We got about a minute and a half. I'm going to give it to the budget guru. So how much money do you pay yourself? Me right now? Yeah. $150,000 a year. Okay, great. And do you have some margin? I'm guessing you have some margin in the business after you pay yourself? Yeah, I usually keep very little profit in the business to minimize corporate taxes. But how much money could you put away, real quick, how much money could you put away a month in your business for a car replacement

after paying yourself at all expenses? About $1,500 probably. Yeah, I'll do that. That's great. I'm doing that today yeah I would too I mean you've got some margin there start putting a car replacement fund in your corporate bank account

and boy that's going to be great good hour Jay great call enjoy that this is the Ramsey Show Hey, you're still here? What are you doing? You do know that the rest of today's show is playing right now over on the Ramsey Network app, right? All you got to do to finish the episode is search Ramsey Network in the App Store, Google Play Store, or just click the link in the show notes to download the app for free.

Yep, you heard me right, for free. Then right there on the home screen, you can watch the rest of today's show. Bada bing, bada boom. All right, I'm getting out of here. Enjoy. We'll see you on the app.