The Ramsey Show - It's Never Too Late To Start Over

Starting point is 00:00:04 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 Ramsey Network in the Fairwinds Credit Union Studio. This is The Ramsey Show. And I am at Rachel Cruz hosting this hour with my good friend and co-hosts of Smart Money Happy Hour, George Camel. So we will be answering your questions at AAA 825-225, what's your life and your money. Let's pregame before the happy hour.

Starting point is 00:00:40 I know. We leave for a recording right after this. So we're together all afternoon. Me and George. I apologize already to Rachel. Don't worry. All right. Let's go to Kurt in Charlotte, North Carolina.

Starting point is 00:00:52 Hi, Kurt. Welcome to the show. Hey, thank. How are you guys doing? Hi, we're doing great. How are you doing? Good. I'm doing good.

Starting point is 00:00:59 So I got a question. So we have some debt. And I'm not quite sure how much. I know we do have a loan for 25. thousand. We have a car payment. We have two car payments. And my wife says she has, we have about three or four years left on the one car. But every time I bring up Dave Ramsey, my wife, cringes. Her ex-husband, you know, lived by Dave Ramsey. And every time she says, I hear that name, I don't want to talk to you. I don't want to have anything to do with you because I hate that name. I want to find a friend. I want to

Starting point is 00:01:38 follow what Dave says, but she doesn't want that. So I just feel like we're continuing, just continuing to just pile on more debt. And I mean, she wants, you know, we want to do things, but it's like, how can we? I don't say it to her, but it's like, how can we have, we don't have any money. We're just going deeper into debt. Yeah. How long have you guys been married? 20 years. How long, oh, okay. How long was she married to her ex? Just a short time, I believe, a year and a half. Oh, okay, okay. So she has thrown the baby steps out with the bathwater here.

Starting point is 00:02:12 It's unfortunate. Correct. It's a trigger for her. She associates with her past trauma. And so therefore, anything you talk about the baby steps in Dave, but does she actually want to get out of debt on the underneath the surface of that? I don't think she does. I think she's, I don't want to say used to living like this, but it might be the normal for her. Yeah.

Starting point is 00:02:34 And I think there's a lot of situations where people just can kind of coast. They're not in the disaster zone, but they're also not thriving. They're kind of just average. You know what I mean? It's just kind of that normal feeling. It's one of the hardest places to be. Yeah, I was going to say. And it is sometimes tough if there's not a massive motivation for change.

Starting point is 00:02:57 And for some people, it's spiritual and emotional. Some people, it's circumstantial. Like, I mean, it's, you know, it looks different for everyone. And so I think more of the concentration would be how you guys get on the same page, right? I mean, we obviously agree on a way to handle money here at Ramsey Solutions. But what we want to see you guys is win in your marriage and when with money. So I'm just, I'm, I want to talk through a little bit more of how to get you guys on the same page. Okay.

Starting point is 00:03:27 So when you do bring it up, what, what's your wording? Because sometimes, Kurt, I'm not going to put you in this bucket. but some of our listeners sometimes are very enthusiastic. And it's almost this like, I'm going to a level of shame. You're doing it wrong. It's all about her, you, you, you versus less about what you're thinking and feeling and desiring. Does that make sense? No, that does make sense.

Starting point is 00:03:53 And she doesn't, so she does not, right now, she doesn't work. And so she hasn't worked for many years. And so she says her job is to take care of the house and pay the bills. So when I try to bring up, well, how much do we owe on this? I don't like flat out say, what do we owe on this? What do we have on this? How much is the monthly payment? I just kind of nonchalantly, you know, try to get it out of her.

Starting point is 00:04:19 But she just, I don't know the exact any numbers. I don't want to say any numbers, but some of the numbers. You don't know a lot. Yeah, I mean, as you were listening, you're like, I don't. Yeah. And, you know, asking how much you guys. owe on something, that's not wrong. That's not shameful.

Starting point is 00:04:33 I don't think you're overstepping there. That's not an overstep. An overstep would be like, I can't believe that you keep doing this and this is your fault. And the fact that we're here is because of your decisions, right? Like it's more pointing at her. But you asking how much you owe on a car loan, Kurt. I think that's okay.

Starting point is 00:04:47 I think that's okay. So I think Rachel's right lead with the I statements. I feel like I've been in the dark. I feel like I haven't been doing a good job leading in this area. We've been married this long. And I feel like I'm just kind of. floundering here. And I want to be on the same page. I want to accomplish some amazing things with you. Are you willing to go on this journey? And I want to know what's going on with our money.

Starting point is 00:05:09 Like that's okay to say. Do you feel like you tiptoe around her in other issues besides just money? Money is pretty much the only issue I tiptoe. Tipto around what they're on. And I don't know why. Okay. How old are you two? We're 50. Okay. So what does she want at 52 or 55? Does she have any goals, dream? desires? I know her what she talks about to me and is, oh, we want to, you know, when our daughter, she's 13, when she goes off to college, we want to, you know, move here and have, you know, an acre or two and, you know, buy another house. And she says that, but I think, I'm thinking that while she says that, I'm thinking in my head, how are we going to do that? We don't even have

Starting point is 00:05:54 any money saved. But what if you go with her on the dream and go, I love this? Now let's reverse engineer this dream. What must be true? for us to have a second home and send our kid to college debt-free. Well, we need margin. What's taking up the margin? Oh, you know what, what if we got rid of the car payments? Man, that free up some money we could then invest. And what if we save this much over time and we could afford that second home in cash?

Starting point is 00:06:14 And what if I could retire at 56 instead of working because I have to at 78? Now it's a different conversation. That has nothing to do with Dave. The byproduct might be we follow a plan that works. But right now, I think we need to do some dreaming together. Yeah, and I do agree with it. that. It's just I'm maybe I'm more of a realist and think we can't do that. There's impossible. There's always a how person and a wow person in the marriage and you are the how. You're like,

Starting point is 00:06:40 yeah, that's not going to work. And she's like, wow, way to be a dream killer. Kurt. And it's probably what she thinks Ramsey is, is a bunch of dream killers that we can't do anything or funny. Funny duddies. You know, and so yeah, and I want you to, I really want you to step in And it doesn't have to be combative, but two adults in a marriage should have equal say in what is going on. And so she has carried the weight, but also carried all of the influence. And that needs to be really evened out that, yes, she can still pay the bills. Like my husband's the one that goes on and actually hits the buttons and does it. Thank God.

Starting point is 00:07:20 Sweet Winston. So that's okay. But sitting down together and agreeing on what is going on with your money and knowing where it's going, that's not an out-of-bounds conversation. That's actually leading to a healthy marriage. Yeah, I agree with that. Having that conversation with her just to be involved with her and see how she does things and see how it and then slowly make suggestions based off what I'm observing her doing. Yes. You need to get really good at improv, Kurt.

Starting point is 00:07:52 And the key to improv is yes and. So when she says it, go, yes, and what if the way to get there was this? What if we crafted a plan to get to your goal instead of, oh, we're never going to own a house because we got two car payments. Now it's a fight instead of a dream session. And I think that that vision and dreaming needs to come first. The Y has to come first before we need to get on a budget. Your spending's out of control. It's never going to go well.

Starting point is 00:08:15 And George, we find in money and marriage, when you have those conversations and the conflict arises and you, and you actually learn why she's frustrated here, or why she's scared here, or why she is annoyed with it. Like, you actually start to get to know your spouse more. When you avoid the hard conversations, you never get to the depths of really what's going on within them. So it's actually such a positive

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Starting point is 00:09:58 And right now, you can try NetSuite Next for free. If your revenue is at least seven figures, go to NetSuite. Suite.aI. slash Ramsey. That's netsuite.a.ai slash Ramsey. Up next, we have Wanda in Seattle, Washington. Hi, Wanda. Welcome to the show. Hi. Hello. How are you doing? Well, I'm doing okay. Just a little stress. Oh, I'm sorry. What's going on? How can we help? I'm trying to figure out how to get some money in my savings or any savings anywhere. We make $102,000 a year.

Starting point is 00:10:53 Okay. And I have $57,000 in debt. Okay. I have $175 in savings. And that's it. All right. Are you working and your husband? No, we're both retired.

Starting point is 00:11:13 I'm 73 and he's 76. Okay, but you make $102,000? Is that from... pensions or it it yeah he has he's retired military he has um disability and his pension and full security and i have social security okay so is that 102 going to be uh for the foreseeable future yes okay well that's until we get our next pay raise and when uh is like a cost living adjustment is that what the pay raise is okay okay okay so it'll just just slowly go up to meet inflation, basically, but it's not like you're getting a true raise where you're

Starting point is 00:11:52 going to have a ton of extra margin necessarily. No. Okay. So what kind of debt's to 57? Lay it out for us? I have $14,000 in credit card debt, and I have $32,000 on a travel trailer that I really don't want, and then I got $16,000 on a personal loan. Okay. And that's everything. Yeah, that's everything. I do have a truck that I'm leasing, which I, if I knew how to get out of it, I'd get out of it. Okay.

Starting point is 00:12:31 So a lease truck, okay. For the $32,000 trailer, have you, I'm assuming you've looked to sell it because you said you don't really want it. How much could you get for it? Yeah. But I don't know if we were, if, or when you got one you call it underneath, you know. Underwater. Oh, underwater on it.

Starting point is 00:12:51 Okay. But is it worth 30K or is it worth 10K? Because there's a big difference. It's worth 30. It's only two years old. Okay. So you might be able to get out unscathed, or maybe you put in a thousand bucks to get out of this. But that gets rid of over half your day.

Starting point is 00:13:07 Yeah, that's amazing. What's the payment on that? It's $3.87 a month. Okay. And what's the $14,000? and credit card debt. How did that happen? Well, it showed you how smart we are. We refinanced our house, paid off all our credit cards, and then two months, we're back up to $7,000 each.

Starting point is 00:13:27 Wow. So we never actually fixed the behavior underneath? No. We just played a little shell game, and we're back to where we are. Well, are you guys ready to change? Because that part we have, that's the rude of all this. Yeah, he says he wants to be debt-free. So I'm, you know, that's right. I tell you. Let's put the money where the mouth is there.

Starting point is 00:13:46 Because you guys have a great income. If you called in and you were both working, making $100 grand and had $50 to pay off, I'd go, great, we can solve this thing within six months. Yeah. Sell the trailer, live on nothing, and throw it all at the debt. You guys are done. And then you have all this margin for the rest of your life to build wealth with. Yeah.

Starting point is 00:14:03 How old are you guys, Wanda? 73 and 76. 73 and 76. Okay. Yeah, so there's a shorter life expectation she has. No. I don't think we'll make it 30 years. I mean, you made it this far. I mean, we're going to go positive.

Starting point is 00:14:22 You know, you never know. Because life expectancy is not really, it doesn't reflect reality because you've got people who died super young, people who died super old. So the fact that you made it into your 70s and you guys were in decent health, sounds like? Yeah. Okay. So Wanda, here's what we're going to have you do.

Starting point is 00:14:39 George, tell me if you agree with my assessment. Number one, Wanda, we're going to cut up the, credit cards. Okay. Okay. You have to stop. As of right now, I put a stop on it. Great. But cut them up. Cut them up and close the account. Do you have one near you right now? No. That's unfortunate. My husband has, my husband has his and mine are in a lockbox somewhere. Okay. Perfect. So tonight's though, Wanda, promise me and George that you guys are going to sit down at the table. you're going to take all those out and you're going to look and you and you should be mad at them Wanda they've not helped you they've not helped you no they haven't they're they're they're

Starting point is 00:15:22 horrible they're terrible they're terrible and so you should want to just demolish them and if you do it in a creative way just DM me and george and let us know but yeah get rid of the credit cards that's the first thing um okay number two i want you guys to do a written budget and I want to figure out how much money you can get out every single month that's extra Okay. So you're, you guys, what you bring home every month, what can we, if we don't go out to eat, whatever we do, month to month, how much money can we get back? And it would be fun just to add to it that if you sold this trailer and you got an extra 300 bucks, right? Add that in. So it's like, could you get up to $1,000? Could you get to $1,500? What does that look like for you all? And I want you to find that margin because I want you to get this, I think you said you have $175. in savings. I want you to get that up to $1,000. And I want you to do that fast one. I want you to look around and see if there's stuff you can sell, how you can get that. And I would say, I don't know, George, what, two months? I mean, you should be able to do this in less than 30 days based on your numbers. And that's, so that's, all right, we've got to add $2.50 a week to this thing. What can I sell this week? How can I cut our budget to create that much margins so that we can get to a little bit of safety? Because when's the last time you guys had $1,000 to your name and kept it for a while? quite a while ago when we were actually debt-free.

Starting point is 00:16:49 Yeah, yep. So that's going to be your first step, Wanda, okay, is that. And then I want you to keep that momentum of that $2.50 a week or more, whatever you can find to start throwing at this debt. And if you can sell the trailer, then you guys will have $30,000 of consumer debt, okay? So if you have $1,000 a month, obviously it's going to take you, you know, a little over a year.

Starting point is 00:17:12 if you have... If you do $1,500 a month, it'll take you 20 months. So less than two years, you guys could be debt-free. And if you could do more, I mean, you guys are bringing home how much every month? What ends up in your bank account? 85. Okay, so think about that. $8,500, could you live off of half of that to cover just your basic bills and your minimum debt payments?

Starting point is 00:17:34 Most likely we have before. Okay, so now we're talking $4,200 going at this thing. If you used half for living, the other half for debt, You're done in six months, seven months. Okay. So we're not talking sacrifice forever. We're talking about six months of sacrifice and then six months to build up an emergency fund.

Starting point is 00:17:52 It's good, George. I was way less aggressive. I was like a thousand, a thousand dollars a month, Wanda, we can do this. We can. George just found you four thousand, right? Because you told me you can live off half of your income if you guys got serious about this.

Starting point is 00:18:05 I mean, seriously, Wanda. And then you guys are in retirement, making 102 a year. It's great. Yeah. And if you guys wanted to do it. do some extra savings on the side, which I think you should. You should beyond that debt, get a fully funded emergency fund, but you just kind of keep that lifestyle going for a bit.

Starting point is 00:18:21 And if you could do this in six months, you could get that emergency fund in five months. Yeah. You'll get there in no time. Do you guys have a mortgage? Yeah. Okay. What's the mortgage every month? 2482. Okay. And how much is left on that? We just refinanced in last May, so $350. $350 left. Okay. Well, you guys will be in good shape to keep affording that mortgage and even throw extra at it and invest once you knock out these consumer debts.

Starting point is 00:18:56 So right now, let's start to really build for this future ahead of us. Let's imagine two years from now you guys are completely debt-free with the emergency fund, investing for the future, paying off the house early, and no stress in the house. And I'll say, one, like, the future is now for you all. You know what I mean? Like, I mean, it is like, it starts today. It starts today. But it is, yeah, it has to happen now. I mean, it really does.

Starting point is 00:19:18 For you guys to, yeah, to not have stress about this. I mean, you know, you're, you guys are in your 70s. It feels chaotic financially. You've made some bad mistakes. Repeated those bad mistakes. But this, honestly, is the moment that you both look at each other and say, okay, we're going to have to do something different. Because the credit cards aren't helping us.

Starting point is 00:19:36 The personal loans aren't helping us. what are we going to do? We deserve a better life for us in retirement. Do the opposite. Yes, where you're living on less than you make. You're getting out of debt. You're staying out of debt. You have cash in the bank for an emergency fund.

Starting point is 00:19:49 And it's all so doable ones. It really is. So you guys had some hard work in your lives to create that 102. And so we want that to go as far as possible for you. Back to school time means you're depending on your vehicles more than ever. Whether you're driving kids to school, helping one move into a dorm, or just managing a busy fall schedule. The last thing you need is your car to break down and throw your plans off track.

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Starting point is 00:21:57 That's going to help you free up more money and work the plan faster. It's like having, you know, me or George walking with you every single day on what to do with your money. So make sure to check out every dollar for free by downloading it in the app store or Google Play. All right, let's go to Olivia in Miami, Florida. Hi, Olivia. Welcome to the show. Let's get her on the line here. Oh, my gosh. Let's see, the button stuck. The button is I promise you. Rachel clicked. I did. Okay, there she is. It's back. We got you. How you doing? Hi, Olivia. Can you hear me guys? Yes, we can. George fix the button. So now you're on. IT support.

Starting point is 00:22:35 How can we help? My husband and I have very different spending habits. He is a more of an in-the-moment kind of person. Like, he'd see something, he likes something, he buys it. And then what happens is Friday comes, and I can't pay the babysitter. And he likes to spend, and I like to be more organized with money. And I respect that. It's his way of living.

Starting point is 00:23:02 but let's say yesterday we had a negative in our account. We're over $100,000 in debt, and he hired guys to do construction to extend their house. And, you know, I respected the way of living, but I don't know how to be. I don't have to be. I don't. He's putting your entire family in jeopardy and in danger. Very stressful.

Starting point is 00:23:24 Nothing about this demands respect. This isn't like, oh, he likes a shirt and he's going to go buy it. This is, this is bad. Like, you can't, you're not even be, you're not even. able to pay for your actual needs in life of what you're needing to do. So what do I do? How long have you been married? Five years.

Starting point is 00:23:44 Okay. It sounds like you're at the end of your rope. Like you're like, I've talked to him, I've tried everything and nothing's worked. Is he combative? Is he defensive? What does he like when you approach him going, hey, we're $100,000 in debt and we can't pay for our bills? Are you not scared? Do you not feel a sense of urgency about this? How does he respond? He's like, no, I'm going to get a deposit next week or in a month from now. We'll be fine. Everything's going to be fine. And sometimes he's right, but not always.

Starting point is 00:24:15 No. Well, and so what's going to have to change with in him is that he may be fine, but his wife is scared to death. And his wife is stressed out. And so in order to love your wife well, you actually have to surrender some of the things that you want. in order to take care of her, right? And that's where, that's where this money stuff stops being money, and it starts being marriage. It's marriage issues that your husband does not listen to you

Starting point is 00:24:43 and doesn't respect you, Olivia, in order to change his behavior in order to, and again, you're not, your behavior, and what you're asking for is not crazy. Like, this is pretty basic math here that he's just completely going against. What can I, is there anything I can do without changing him? to like, I don't know, protect myself, maybe just so that I don't stress about it all the time.

Starting point is 00:25:08 For the short term, you can, but that's not a long-term solution, because if anything, it just continues to divide your marriage. The goal would be that you guys, as a married couple, heal and find a path forward, and then the money habits and all of that follow. I don't want you to just avoid the issue by opening up your own accounts for the long-term. For the short term, we can talk through some of that if you really do feel like he's completely... You need enough money in your own account to pay the bills so you don't get foreclosed on. Yep.

Starting point is 00:25:42 How much do you guys make a year? It's luxury, but the last few years it was in the high 200. Okay. Are you both working? I work for him. Oh, boy. You work for him. Okay. So how much do you bring home... Do you bring home a paycheck? Like, does that...

Starting point is 00:26:02 I don't have a salary, no. I just work. So you work for him for this business? Yeah. And then all the money just flows into y'all's checking account? Right. Okay. What kind of work do you do?

Starting point is 00:26:17 He does construction and I do his books ironically. Mm-hmm. So you tell us, what is the path forward for him to see this thing for what it is? You guys make $285,000 and you have nothing to show for it. You're going backwards every single month. I don't know. I guess then you can have a conversation with him, but how do I go about that conversation? Usually the most productive way is more concentrating on you, Olivia, because the sad thing is you can't change him.

Starting point is 00:26:51 You can tell him and express to him exactly what you're feeling, what you're thinking, what your desires are. I mean, and at this point, Olivia, I mean, what your ultimatums are, right? Like, you don't want to live like this for the rest of your life where you're scared. You can't even pay your bills. And so, you know, an ultimatum that if he doesn't do X, Y, and Z, meaning like he doesn't he doesn't spend over X amount without you both agreeing. He doesn't spend extra until X, Y, and Z is paid. You know, these kind of things, that is a, that's a normal way to live. And if he he refuses to do that, then yeah, then I mean, I would be taking a salary then from the company and paying myself and having my own account until you guys can get it on the same page, right?

Starting point is 00:27:41 And so there's some, and it's not like I'm going to throw this in your face in a threatening way. It's more of a I'm scared to death and I'm stressed. I'm losing sleep at night. I feel like I'm losing you as my husband. I don't feel like I'm being heard at all. I don't feel like we have equal value in this marriage. You know, this is how I'm feeling. And so in order for...

Starting point is 00:28:02 Yes, and in order for us to move forward, if you don't do X, Y, and Z, then these are the steps that I'm going to need to make this work for the short term. Yes, for the short term, absolutely. Do you guys have kids? No. We have one kid, yeah.

Starting point is 00:28:17 Okay, how old? How old the kid is? He's one. Okay. Did that change anything for you guys in the marriage? Yeah, I did because now when he spends on the kid, I can't say anything because it's for the kid. For the one-year-old.

Starting point is 00:28:33 What does the one-year-old need? Other than formula and diapers. I barely last week we needed $300 worth of toys. Okay, but you can say something, Olivia. This is your money, too. Just because the purchase was designated to another person, it's your money. This is your money that he's spending, too. It's y'all's money, I mean, is what I'm trying to say.

Starting point is 00:28:57 Like, you have as much say in what is going to be. and what is going on with this. And so, yeah, I mean, at that point, if you lay out your heart, and again, and I'm, we're being a little bit probably like hardcore because I want to, I want you to fight for you. But you can do this with a lot of, you know, calmness and humility and all of it, but yet be stern and what you're needing

Starting point is 00:29:22 because it's, that's survival is what you're talking about. And this is a solvable problem because if you're high income, you guys can be debt-free in 12 to 18 months. So this is not a lifetime of sacrifice, if that's what he's thinking. It's, hey, we got a reset here. We don't have any financial foundation. We are at risk all over. We got payments up to our eyeballs while making almost $300,000.

Starting point is 00:29:43 We should be doing better than we are. And if he can't see that, again, to Rachel's point, you're not going to change him. And at that point, you need to decide what you're going to do. But I would not just be putting up with this going, well, he's just a step. guy, he has a preference to make us broke forever. It's not like he prefers Thai and you like Mexican. This is far beyond that. Or he sells, you know. I try to be. I don't want to be the kind of wife that's like, oh, you can't do this, you can't do that. You can't send them that. Olivia, you're not. You're not. You're not. It's not like you guys have all this cash sitting

Starting point is 00:30:19 around and he wants to go buy a ninja slushy on Amazon and you're like, you can't buy that. That's stupid. Like, this is, this is paying bills. This is keeping you. guys afloat that you're not in the negative in your checking account so to to be out a 10 that is okay Olivia that this it calls for a 10 that is not you nagging that's you having money yeah the fact you guys make 300 grand and you're still going into debt every month that's a problem and Olivia that it you guys may want to go see a marriage therapist because the fact that that's even a thought within you, I need to be probably worked out.

Starting point is 00:30:58 And I'm not saying that to shame you. I'm just saying like, what we're hearing, the language around your marriage and how he needs to be treated, it sounds like you're tiptoeing when he needs to, he needs to get it, George, you know?

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Starting point is 00:32:52 Next up we have John in New York City. Hi, John. Welcome to the show. Hello, how are you? Hi, we're doing great. How can we help? I'm kind of curious if I'm about to commit financial suicide. I've been following the baby steps for a while, and I am looking at changing jobs, and I've been at this company for a very long time. But it's gotten to a point where I'm super frustrated and don't want to be here anymore.

Starting point is 00:33:20 What's a long time? How long you've been there? Coming up on 20 years next year. What do you do? So 19 and a half years. I work in a lot. manufacturing. Okay. And you want to jump ship to what? Working on boats.

Starting point is 00:33:37 Like a completely different mechanic? Yes. Okay. And do you have the skills to do that? Or would that require some licensing, some education? So I have a job offer at a company that is willing to train. Great. What are they going to pay? But it's a it's a big pay cut for me. So I'm currently making about 135. This new job would be about 48,000. Okay. Are you single?

Starting point is 00:34:09 I have a fiancé. Okay. What does the fiancé think about this? She's kind of down for whatever I'm down for. I'm the breadwinner of the house, and I need to, you know, keep things afloat. What does she make? So she doesn't make very much. She makes about $15,000 a year.

Starting point is 00:34:28 What does she do? She's actually on disability. Okay. So for the foreseeable future, $15K is the ceiling? Yes. Okay. When are you guys getting married? I'm not sure about that.

Starting point is 00:34:42 Okay. How old are you guys? I haven't said a date. I am 44. She's 52. 44 and 52. Okay. And what's your financial situation?

Starting point is 00:34:50 Do you have any savings? How much debt do you have? Yeah. So, like I said, I've been following the baby steps for a while. and now I'm kind of struggling with the other side of actually being okay with spending some money. So I managed to save up. I got about $5.50 in the 401. That's split between traditional and Roth.

Starting point is 00:35:10 I got about $25,000 in the stock market, about $30,000 in a high-yield savings account, and about $10,000 in my working, checking, and savings account. And no debt. I owe $57,000 on my house, which is, was worth, had a real order come out. She said we would list in between 350 and 375. Nice. Okay, no consumer debt.

Starting point is 00:35:35 So you're in really good shape on that side. Where is this job going to be? Do you have to relocate? Yeah, so it's actually down in the Bahamas. So this is like a life change. Yeah, this is a complete life change. Okay. I'm unaware of the cost of living in the Bahamas.

Starting point is 00:35:54 Is it more or less than New York? So that's actually, there's a shared living arrangement with this company, and I would have the potential to stay there and not have to pay rent. Fiance is welcome as well. However, it's shared living, and I'm not really... What does that mean? Yeah, like you're in a house with other people? Yeah, so it's basically a two-bedroom apartment, and there's two of the employees live within that apartment. So you have your own bedroom, room, but you share a living room and kitchen.

Starting point is 00:36:26 Okay. be doing that while you're still engaged. But once you guys get married, probably not, right? Right. That's the idea. Yeah. So what would...

Starting point is 00:36:36 I wouldn't be comfortable with that. Yeah, that's fair. That's fair. Okay, so have you figured out cost of living down there? How much it would take you to pay rent and everything a month? Yeah, roughly, I'm thinking probably around $3,000 a month. Okay. So what you make, basically will, for the most part,

Starting point is 00:36:56 be going towards living and you may get, I don't know, a couple hundred bucks or a thousand bucks extra a month? Because after taxes, if you're making 48 gross, right? I'm like, I don't know what the Bahamas tax. I mean. Yeah. But if you're making 48 gross, you're going to be probably netting around three grand. Yeah, so they only pay an insurity bond, which is like three and a half percent.

Starting point is 00:37:18 Okay, so it's not as much. And that would also still be concerned about potential U.S. income tax, whatever that might be. because you're not going to be a citizen there? Okay. Correct. Yeah. Man. Okay.

Starting point is 00:37:34 Well. There is also, I am a disabled veteran. Okay. And I do have substantial income from that as well. Okay. That would be equal to $4,500 a month. Oh. Well, you buried the lead there.

Starting point is 00:37:49 That really helps us out here with the expenses. We were scared. You were running it up to the line. But if you have that kind of margin. I'd say. Ahoy. Sianara. I don't know what they say in the Bahamas.

Starting point is 00:38:01 Captain John. I mean, it sounds like a fun adventure. If your fiance is on board and it's not going to destroy your relationships, even if you did this for a couple of years, I was going to say, yeah. You've got some wiggle room to do this and then go, oh, that was fun. I think you'd be fine. Yeah, again, long term. I don't know if that's what you want to do.

Starting point is 00:38:16 But the great thing is you've set yourself up well that your investments are going to continue to grow. You're going to be able to live well within what you are making, probably hopefully maybe still investing. I don't know how that works with taxes and I don't know, but kind of figuring that out. And yeah, and then maybe you look up in five years, six years. You're like, you know what? I could probably go get a job in manufacturing again for 90,000 different company, less stress and keep moving.

Starting point is 00:38:42 And then you're going to get some equity from your home when you sell it to do this move. You'd walk away maybe 300 grand right there. You could just invest that. Just leave that and let it grow. And yeah, I mean, you'll come out for sure over a million dollar net worth. John, by the time this is all said and done. Yeah, I mean, I'm sitting at 950 right now, and maybe that's part of the block, right,

Starting point is 00:39:05 is continuing to move the goalpost and when is enough enough, right? That's kind of what I'm struggling. I'm just wondering, is there an alternative where you go do a different job that you enjoy and the boat stuff is still a really fun hobby? Maybe it's a side hustle versus jumping ship, pun intended. I would say that, but if it would be different, he's working on the, I don't know,

Starting point is 00:39:28 harbor in New York versus the Bahamas, you know? Yeah, I mean, it sounds enticing. Well, it just sounds like a different, like, it's almost like you're just itching to get a different lifestyle, too. And it doesn't sound like this is a permanent pay cut. The goal would be, how do I get back to making, you know, close to six figures or more while doing something I enjoy? If you came back, though, but would you be okay with him on a Bahamah,

Starting point is 00:39:51 what's the upside there? Is there a room to grow there in the career? But I hate to say it. She's like, does it matter? It doesn't matter. Rachel's going to do it for free. At this point, you got a million bucks sitting in the bank. You live off of what you're making.

Starting point is 00:40:05 I mean, do you have kids, John? No. She has three that are out of the house. Okay, okay. I mean, it sounds like a fun adventure. To me, there's a low-fail scenario. It doesn't bother me. Knowing that this may not be a forever plan.

Starting point is 00:40:21 Why do you keep saying that? I'm just wondering, is he going to be 68 working on boats in the Bahamas? He might be. He might be. What do you think, John? The ultimate goal would be to own my own boat and sail it around the world or at least, you know, island hop and cruise. Now we're talking. Wow. That's some vision right there. That's what you can invite me and George on. We'll bring our spouses. You can thank Rachel for her great advice. It'll be a super yacht. Okay, so that's great. I mean, in a sense of having, there is an external goal, right? So you're not just sitting idle. Like there's something you're still working towards, which is your point, George, that's like, how can we be growing? working towards something, and the boat thing is great.

Starting point is 00:40:58 And you'll have plenty of margin in your budget with what you're getting from the military and what you're making to make that a goal. To, yeah, save up for the boat and do charters. And I think it's great. Congratulations, John. All right. Well, put in your two weeks. I'm about to go to HR.

Starting point is 00:41:20 See, all right, good luck. George, that's what scares me. You know, we have fun and throw up. say whatever we want. John has to go meet with HR. And I actually take the advice. And then he's got to tell him. A Rachel Cruz told me that I do.

Starting point is 00:41:34 I stand by that. I do. I stand by it. But it's a good reminder. You don't have to do work that you hate just because it's good money. That's right. Absolutely. And you don't have to go to the Bahamas to find a great life.

Starting point is 00:41:46 To your point, he could have found a totally different manufacturing job. Yes. But it sounded like he single. He's single. I wrote down, what was his age? 40? 44. 44. Fiance's 52.

Starting point is 00:41:58 You know, and there's not much tying them down, so it's like, you know. If not now, then when? You know, he's still got the energy to do that. I think it's fun. Send us some picks, John. I can do it. I want to see you working on this boat in the Bahamas. I know. Beautiful water. Oh, enjoy it. You worked hard.

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Starting point is 00:43:41 outcome is guaranteed. Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. I am Rachel Cruz hosting this hour with George Camel. All right, we're going to go to the phones. And in Jackson, Tennessee, we have Ron on the line. Hi, Ron. Welcome to the show. Hi, Rachel and George. Hope you guys are doing well. I have a quick question. Have you guys ever seen or heard of a store offering a significant discount if you finance as opposed to pay cash, even if it's 0%. What kind of store are we talking? furniture. Okay. So just to make, just to make the numbers around, if I, my wife and I went to the store, find a nice piece of furniture we wanted. Let's just say the numbers were $1,000,

Starting point is 00:44:29 let it's offer to write him a check. And I say, no, we don't want you $1,000 today. We'll get, let us pay, let us pay $800. Yes. And do it over 12 months. Have you ever seen that? Yes. And again, I'm not, yeah, I'm not asking about this. If is this dead, can I free up cash flow? I thought that's question. It's my business sense is going off as people don't, offer 20% discounts for nothing. And so I'm wondering what is the incentive to do something like that? Well, they have the data that shows how much they're going to make in interest charges when that person can't pay it off in the promotional period.

Starting point is 00:45:01 And so they're making their bets that they're going to make more than the 20% discount they're giving you off of the debt they're going to sell you. And they probably will because what they end up doing is putting you, it's almost like a 90-day same as cash kind of scheme, right? So you go and if someone that can't just sit there and write an $800 check, and they take this deal, then, or the $1,000 to take the $800, yeah, their likelihood of them at some point

Starting point is 00:45:28 getting behind on the payment, and if they miss one payment, then it's all back interest, all back fees. I mean, they make so much money off of those kind of deals. Now, is this one particular store, or are you seeing this at every single furniture store you walk into? Just one particular store. I mean, we did not tie furniture very, very often.

Starting point is 00:45:47 I think the last time we actually went into a store, store and bought furniture was years ago. Okay. Well, what I would do is I would wave that amount of cash in their face and say, hey, have $800 cash here. If you don't like it, I'm walking down to the next store. That's it. And just walk away. Yeah, I literally went into them and say, hey, if I do this, I hate doing this. I've never done with finance companies in my life. And I know you guys have, and that's why I'm calling. I literally said, hey, if I do this, the very first opportunity to get this balance to zero,

Starting point is 00:46:17 So here's the check for it. And they said, okay, we'll still do the discount anyway. So I'm just really confused. That's all. Yeah, I mean, it's just a system. This happens in car dealerships, too. They'll say, here's the price. And they find out you're paying cash and go, oh, no, no, no, that price was only

Starting point is 00:46:34 if you're financing. Because they make more with the financing. They get kickbacks. They're going to make money off the interest. And so I just don't deal with places that... Even to 0%. I don't deal with places that don't have integrity. I say, here's the price.

Starting point is 00:46:46 That's what I'm paying. Because if you go and read the fine print of what you're about to sign up for, I guarantee you that it says there will be a, it's zero interest if you pay on time. If you don't pay on time and you miss something or they don't get the check in on time or it doesn't clear their system, then it's all back. And the interest sometimes on those drawers is more than credit cards. Oh, it's insane. 30%.

Starting point is 00:47:09 I mean, it's just wild. So, no, they know what they're doing. And what they're really doing is they're just inflating the cash price. they're not actually discounting it. They're just inflating the cash price to where the financing price looks so much better that everyone's going to go, oh, well, why wouldn't we finance? So it's all psychological. It's just mind games they're playing.

Starting point is 00:47:27 Uh-huh. Okay. Yeah. Again, I never deal with the stuff. I know you guys do, and I appreciate you. She's having a light on this. Yeah, for sure. Yep.

Starting point is 00:47:36 And, you know, what I always worry about George is some people try to take the deal to get the $200. Thinking they won. Thinking they won. And then, I mean, y'all, These companies, sometimes they come back and like, well, it didn't clear our system within that 24-hour pay period. It happened. And if you didn't read the fine print, you have to pay by this certain date before the terms are out. And what you sign up for? You, yep. And so if you play with snakes, you can get bit. So listen, just stay away. I just played this game buying a car. And they were like, well, here's the price. And I was like, I'm not paying these random stuff you threw on there. And so I left and went to a different dealership that treated me with fairness and integrity.

Starting point is 00:48:13 It's a beautiful thing. Here's the price we agreed on. I'll write you a check for that amount. That's right. That's one thing of not being emotional when you're buying something. Something as small as a chair at a furniture store or a house, right? We get so invested or a car in this one particular thing. I can only have this, this right in front of me. And then you lose all negotiating power and the power to walk away and find a better deal. And so you just can't get emotional about this stuff. And I'm personally just not a fan a lot of these furniture stores because the margin is high. The salespeople can be sluble. slimy. So here's what I do. And they pry on people that can't afford it either. Yeah, do your research. Take that exact couch. Take a picture of it. Get the tag. Research it online. You can even upload a picture of the of the couch to Google and it will show you similar couches at a cheaper price. Amen. So do your research people. Don't just walk in and get hosed by a salesperson with these financing deals. Oh, it's only today. It's only good for today only. I'm sure it is, bud. I'm sure it is. All right. Let's go to Lynn in Knoxville, Tennessee. Hi, Lynn. Welcome to the show. Hi, thank you so much for taking my call. My question is, I have about $50,000 saved up for a down payment on a house, but I'm not planning on buying a house right now. It would be at least two years, but it could be, but not necessarily less than your four to five-year recommended timeline for putting money in the market.

Starting point is 00:49:39 So two years is kind of your window for, you want to buy in, let's say, 20, 28? Um, honestly depends on my relationship status at the time because I would either need significantly more savings or to be married for the down payment to make sense and be within your parameters unless I want to get a little tiny fixer upper. Got it. So two years from now to afford something on your own with your own savings would be really tough. But you're sort of hoping that you'll be married with two incomes by then? Perfect world. That'd be great. Okay. Is there someone special in your life right now? No, that's why I say at least two years. Okay. But maybe less than five.

Starting point is 00:50:27 Well, $50,000, that's a lot. How long did it take you to save that? About the last five years. Okay, good for you. So you can sock away another $10, $15,000 a year at this point? Mm-hmm. Maybe not quite that much because I did open a Roth IRA and start maxing that out. You're sounding like an eligible eligible bachelor at Lynn. Well done.

Starting point is 00:50:54 So would I invest this money knowing that it could be two, even three years? I personally wouldn't. I would store it in a high-yield savings account and just let it grow at, you know, three and a half percent instead of what could happen in the market. Because here's what inevitably will happen because this is life. You'll go, yay, time to buy a house. And the market will be down 15 percent for no reason. And now you've lost money, quote unquote, on paper. and it's going to be heartbreaking.

Starting point is 00:51:20 And so the more time you have, the higher the chances that your money will make more money, that the balance will be higher than when you started. So if it takes me six or seven years, I shouldn't get upset about the amount I could have made because it's better to have the money flexible when it's not a guaranteed long-term timeline. Now, if you told me for sure, I'm not going to buy a house for the next five years. I'd say, all right, let's invest it. Let's let it ride. But it sounds like there's just a lot of variables right now in your life that you're unsure of. Yeah. How old are you, Lynn?

Starting point is 00:51:56 29. 29. Okay. Do you see yourself in that area for a while where you are? Really likely, but not 100%. Okay. Yeah, I'd probably just, I'd probably lay low for a year or two. And if you look up maybe in a year or two and you're like, nothing really has moved about my situation, then maybe invests, right? Because there's nothing looming. But I probably would just give yourself a beat. Let me tell you what I get asked all the time.

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Starting point is 00:53:44 The Ramsey Show Question of the Day is sponsored by Y-ReFi. If you have fallen behind in your private student loans, every month can feel like you are still, that you're standing still. Why refi helps borrowers explore refinancing options that can help you start making progress again. So go to whyrefi.com slash Ramsey. that's letter Y-R-E-F-Y.com slash Ramsey may not be available in all states. Today's question comes from Shawna in Indiana. I've been listening to the show for years and have never heard anyone mention cell phone debt. My husband and I were reviewing our bill recently and realized that between the two of us,

Starting point is 00:54:38 we owe $1,000 on our phones that we bought two years ago. Should we add this debt to our snowball? Juicy. This is a newer thing because everybody's just weaving their phone price. into the plans and the companies love it. They do. Well, and prices of phones have gone up. It's the price of a laptop now.

Starting point is 00:54:57 So much. Like, it's crazy. Because you literally have a laptop in your hand. It's true. As do I. So is this debt? Unfortunately, yes. It is a necessary payment you have to make for a previous decision. And try not paying it.

Starting point is 00:55:11 And that'll tell you a lot about if it's a debt or not. That's a good point. What happens if I stop paying? Well, it'll go to collections. You could get sued. I don't know if they're repoing phones yet, but that's probably the near future. Come get it.

Starting point is 00:55:22 Apple's now leasing phones. I don't if you saw this. So we've, I mean, it's just like anything else now. Yeah. Lease your car, lease your phones. Never own anything. And remember, they're doing this, not out of the goodness of their heart. They always find a way that they are going to make more money doing what they need to do, right?

Starting point is 00:55:38 So just as the consumer, don't fall for it. It says, should we add this to our debt snowball? Yes. Yes. I would. Pay it off. And then pay cash next time. All right.

Starting point is 00:55:50 to Sam in Washington, D.C. Hi, Sam. Welcome to the show. Hi. Hello. How can we help today? Well, I've been listening for a few weeks now and trying to get started. And I have had historically the high-guiled interest savings account as one of the accounts we've had.

Starting point is 00:56:16 So I have that. And we don't have a lot in there. My husband and I are both IT support in the industry of IT support. Total income is around 200,000 a year. But I went into the every dollar app and put in our stuff for August. And it's showing us that we have more payments than we have income. Wow, how much debt do you guys have? Just under $325,000, not including the house.

Starting point is 00:56:57 Wow. Student loans? What are the debts? About a third of it is my student loans. Okay, so will you list out your debts for us? There's a lot of them. You can give us the big chunks. Yeah, this much is in car debt, car debt, personal loans.

Starting point is 00:57:15 We have two cars, about 60,000 total. Okay. We've made a lot of bad choices. That's okay. We get talked into buying things. Okay. Time share? We could probably have put up.

Starting point is 00:57:35 Oh, God, we got out of timeshares years ago. Okay. Who's talking you into this? Sales people, go figure. You need to stop talking to people. That would solve a lot. Okay, is a lot of credit card debt, Sam? Yeah, we do have credit card debt, but we also have some home improvement debt as well.

Starting point is 00:57:56 So the last, latest one was a roof that is insured for 50 years and is good for 100. Are you trying to sell me on a new roof? Oh, my God. You're leading with the features of this roof. What did it cost you? 50,000. Okay. I won't be around in 100 years, so I can care less about this warranty.

Starting point is 00:58:19 But, okay, it costs you 50 grand for new roof. So we definitely got ripped there. That's an insane amount on a roof. Oh, and we have new HVAC from three years ago that we have an attorney involved with that. But you owe on that as well? We owe on that, and the company that sold it to us oversold and didn't. install properly and the thing isn't worked. Sam, I'm going to be honest with you.

Starting point is 00:58:49 So far, it sounds like your debt has been everyone else's problem. You were talked into it. I got scammed. I was told this. If you want to get out of this thing, the first step is to realize it's not all your fault, but it's your responsibility. Yes, no, we completely understand that. Okay, Sam, I want to know how you guys have been month to month now,

Starting point is 00:59:09 because if you plugged in all your numbers and I go, gosh, we are in the red, how deep in the red are you? $800. $800. Okay, where has that been coming from the past couple of months? I mean, if the payments have been consistent, and you guys have been short, $800, are you going deeper into debt, or do you have savings that you're taking from to cover that $800? No, we don't have savings because every time we try to start, something happens.

Starting point is 00:59:40 Okay. And it gets drained. So. I don't know how you have living. So are you using the credit cards to cover any gaps? We don't have gas. We have two electric vehicles.

Starting point is 00:59:53 No, I was saying to cover the gap of like the $800 that you need. You're using credit cards to fund that? For some of it, yes, I believe. Yeah, that's where all the credit card debt is ending up from. Okay. Has your husband looked at this stuff too? Have you guys sat down and looked at the budget together?

Starting point is 01:00:11 Or is this just you so far? Yeah. No, it's, we, both of us are tired of paycheck to paycheck and not, I get more anxiety over it than he does, but he does get frustrated. Okay. Well, I'm glad you called Sam because, yeah, we're going to be able to really just walk you down what we call the baby steps. And you're going to have to, in order to make this work, is it's going to have to be a complete, 180 of what you guys have been doing, how you guys have been making decisions, buying things, how you've not been budgeting, how you know, everything you've been doing, you're pretty much

Starting point is 01:00:52 going to just do the opposite. And so the fastest way to do it is that first step is $1,000. And you keep it, yep, in that high-ield savings account, and don't touch it. And then you're going to be looking at a mountain of debt. And as you listed out smallest to largest, and you said, we have a lot of debt. So if it's multiple credit cards, multiple student loans, I mean, like, literally write them all individually out and actually look at it and say, okay, this is where all of our money is going. And it's probably going to be pretty shocking. You may have already done that because you guys said you plugged in your income to every dollar. And then from there, you're going to have to figure out, okay, we're going to be working extra. We're going to be selling

Starting point is 01:01:33 some stuff to get some cash in fast. We're going to cut our lifestyle. And instead of, you know, acting like you make 200, we're going to act like we make 80. We're going to live on nothing, nothing in order to get this margin up to start knocking out this debt. But the great thing is, too, Sam, is as you guys start paying it off, paying off some of these debts, it's going to free up those monthly payments. So it's going to cause you to have more and more margin as you go down the debt snowball to pay it off. But yeah, I mean, as you're looking at it, it's going to be a bit. And I would look at getting rid of these cars, just to give you a quick win. Yes, yes. Especially if you're not underwater on them. If you can profit off of them and use that cash to buy yourself some cheap cars, five grand each, that's going to be your ticket out. Because then you've got 265 left. And if you threw like, let's say you take home 12 making 200K, take home 12 a month. If you can throw 7K at the debt, you're done in three years. Yep. So that's the napkin math. And we now have to reverse engineer and go, okay, we need to come up with $7,000 and live off five. And there's a good chance. A thousand of that is in the car.

Starting point is 01:02:38 payments, right? So if you get rid of that, that's going to free up cash immediately. And then, yeah, looking at your lifestyle. But that's it. And Sam, what's wild is that this is so doable. And what's crazy, too, when we see people do this, especially as they are working their way out of debt. And when it's over a 24-month period, some people do it, you know, 18 to 24 months, but when you're looking at a three-year journey here, it's amazing the amount of people that get raises in this time. They find some side hustle. They get focused. They start working harder. to get the promotion. It's crazy.

Starting point is 01:03:09 So your income is hopefully going to be increasing throughout this process too, which is going to help bring extra margin. But it's going to feel like whiplash of how you guys have been functioning with money. But you know what? You want the opposite result. You're tired of where you are. And so that means there's going to have to be some changes. And it may be uncomfortable for a bit.

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Starting point is 01:04:48 One of the biggest mistakes that people make is thinking that they can skip out on having a will because they're too young, too healthy, or they just don't feel like they own enough to make it worth it. But listen, a will helps protect your family. It gives you clear instructions and can keep your loved ones from having to guess what you wanted during a difficult time. So if you're ready to create one, go to mama bear legal. Mama bearlegal.com. And if you don't know where to start, text quiz to 3378. and we'll help you figure out what's best for your situation. But again, if you want to create a will, go to mama bearlegal.com.

Starting point is 01:05:45 Yeah, momabare legal forms. They're amazing. I always throwing forms in there. That's why the website at first. I was like, oh, no. I got tripped up. They're shortening the name to make it a little simpler for us to type in. I appreciate that.

Starting point is 01:05:54 But they're great, easy, state-specific wills, you guys. It does not take long. And I'm telling you, it is so worth it. Everyone, everyone needs a will. If you listen to the show long enough, you know the heartbreak that happens when someone didn't have a will, didn't update the will. Yes. And the family's left grieving while picking up the pieces and it causes a relational nightmare.

Starting point is 01:06:14 So please get it done. And we'll throw in life insurance. If you have a family, if someone's dependent upon your income or if you're a stay-at-home mom, life insurance guys. My first question when I find out someone passes, did they have life insurance? And they say, no. My heart sinks because then the road ahead is going to be so much more difficult. Yes.

Starting point is 01:06:31 So, yeah, you can go to Xander insurance for term life. We'll just throw it all out there, George. But it is, it's important, you guys. It's the adulting package. It is. So please, please get it. All right, let's go to Nick in Dallas, Texas. Hi, Nick.

Starting point is 01:06:44 Welcome to the show. Hi, Rachel and George. Thank you so much for taking my call. I really appreciate a huge fan of what you guys are doing. And you guys have my dream job. But anyways, I am calling in bottom line up front. My wife and I are not super sure what we should do with our house. We want to tell it.

Starting point is 01:07:05 A little bit of context. We live outside of Dallas, Texas. We've been in the home since February 2025. We're planning to be in the home longer than we are, but life happens. We're planning to move to Atlanta, Georgia, to be closer to family. Fortunately, we have the house paid off. Amazing. I understand that you guys do not recommend.

Starting point is 01:07:26 Yes. I understand you guys do not recommend doing long-term, long-distance rentals, and we don't want to do that either. However, we live in a new construction community. Our home has been listed for coming up on two months. We've had zero interest, and we want to, I can explain more of why we want to go to Atlanta, but I'll pause there. Looking forward to your guys' recommendation.

Starting point is 01:07:49 Have you talked to your agent as to why there's been zero interest in 60 days? Yes, yes. What do they think? Living in a new construction community, they can, the house, that are going up right across the street from us are able to do, you know, about like a $30,000 incentive that we, you know, just can't compete with. So people would rather build it basically custom and have more options at a lower price? Exactly, exactly.

Starting point is 01:08:21 How long will the development be in process? Do you know how many more, is it, how many more lots they need to build out in that area? Well, they're developing a new phase just as stones throw away from us. So, I mean, it'll be years before they're completely done building new homes. But there's still people who want a house now and don't want to go through that process. And don't have the timeline to wait for a new build. Yeah. So I don't buy that as a full excuse of just like, well, they're still building home, so people don't want mine.

Starting point is 01:08:57 Is it price too high realistically for the current market, which is obviously, cooled a lot? Yes, I mean, it's definitely priced fair. We bought the home at 323 and we listed it initially at 3149. So

Starting point is 01:09:14 I thought we priced it fair, but we've gotten zero interest and that's like definitely runs right with some of the comps. I mean, but to mention though, there aren't there are no retail homes that have sold in the past 90 days you know, and

Starting point is 01:09:30 So it's hard to find good comps because there's not a lot of action out there. Exactly. Exactly. Man, that is tough. When do you guys have to make this move? What's the urgency? So urgency is who's got two young kids. We've got a daughter who's a year and four months old and a special needs son who's four months old. So we're just really itching to be in Atlanta to be closer to family who can help there. So that's... And the house is paid for? Not like Yes, ma'am.

Starting point is 01:10:03 Okay. So what I probably would do, Nick, is, because I mean, how much do you guys make a year? Close to, like, to find out on commission, anywhere between 175 and 200. Okay. Because what I would do is I would go ahead and go to Atlanta,

Starting point is 01:10:26 and I would just, I would rent there for a year. Go sign a year contract. And it's going to not be fun because you went from, owning to renting is going to feel like a little bit of a step back. But I would I would give yourself some time and not be rushed on this house because you don't have to be urgent. It's not like you're trying to balance two mortgages and you're like we can't afford both mortgages. So we got to sell one quick. Time is on your side, which is an amazing thing. That's part of why not having debt that it allows that time margin, which actually allows you to probably get a better deal on this house.

Starting point is 01:10:58 So I would go to Atlanta and I would rent somewhere for a year. Keep the house up. up. I would look at one of our trusted real estate agents, not saying that yours isn't great, but I know ours in the program, like we interview them and make sure that they are high quality. And I would look and maybe get a different option with a realtor. And I would be patient and I would sell this house. I think eventually it will sell. You don't have to sell it in 60 days. You don't have to sell it in 90 days. So I would take my time with it and then reevaluate maybe if it's been, you should be able to sell it. So I'm like, I don't even want. want to put it out there that it'll be nine months and it won't sell because I really do think yeah

Starting point is 01:11:38 eventually it will I just don't want you to be in a rush to do it right so I would just budget for the you know insurance taxes some utilities to keep this thing afloat while you guys make this move to Atlanta but you put yourself in a position where you have that option which is amazing so you'll look back on this and it'll just be like an annoying thing you guys had to deal with during a hard time in life but I like the idea of not making it a fire sale and just knocking down the price until it's at 275. And now you're really, you're eating a lot of this cost through fees and selling it for less than you paid for it. Right. Okay. So it's just a, it's a harsh timing of just you guys bought where things were expensive and the market cooled during the last year. And especially in Dallas where there's just, there's, you know, not a ton of demand. People want to buy homes, but there's not a lot at the price they want it.

Starting point is 01:12:30 and so I would be trying to figure out why are home selling that are selling in my area and how can I start to match that to get this thing to move. Okay, that makes sense. Great. I'm a little surprised that you guys that I went with a long distance rental, but hey, I'll take it. Well, I wouldn't rent it out personally. No, because you're going to eventually want to sell it. I'm saying you just sit on it.

Starting point is 01:12:53 Oh, just hold. Okay, so don't, okay, don't rent it out. Sorry, Rachel. I thought that's, I thought that's a view. Oh, sorry. No. Just sit on it. She was saying go rent in Atlanta for a year.

Starting point is 01:13:00 In Atlanta. Yeah. Okay. Yes. Okay. Gotcha. Have the house set. It's going to be harder to sell when you've got a tenant in there too.

Starting point is 01:13:08 Yeah. So that's going to slow things down. Yeah. And if you guys aren't coming back to Dallas anytime soon because it sounds like families in Atlanta. No. I wouldn't want to be tied to Dallas. It's like just sell the house, be done. Take the equity and go buy something great.

Starting point is 01:13:21 And Atlanta wants it sells. So, yeah, no. Do not rent it out. If you need to change real estate agents just to get another flavor, there do that. Get a second opinion. Yep, I would rent in Atlanta until this house sells and then use that equity and any other cash you guys have to buy, to buy something permanent in Atlanta because it sounds like

Starting point is 01:13:41 that's where you guys want to be. I heard a stat, George, and I hate to throw it out because I need to check. But it was something around like the idea that Dallas-Fort Worth had more new homes being built than the whole city of California. That is wild because of how hard it is to get anything built in California? With the regulations? Mostly that, yes, but also I think... And Texas is like, throw them up?

Starting point is 01:14:03 It's just like, yeah, it's just booming. I mean, people are... Houses growing up everywhere there. Yeah. It's pretty wild. We're seeing that in Nashville in like the downtown area. They threw up all these apartments and condos and... Oh my gosh.

Starting point is 01:14:12 It's crazy. There's just too much supply. It's a lot. It's a lot. So, yep, in those areas, you will feel a little settling back to normalcy. But it is still a wild market out there. But yeah, Nick, I hope that helps. I hope it gets sold quick for you guys.

Starting point is 01:14:27 But yeah, I would make that move. with those two kids, being close to family, go rent somewhere. If you want to free up margin in your budget, one of the first things you should do is take a hard look at your monthly bills. Because every dollar you overpay is another dollar you don't have for reaching your financial goals. And overpaying for your phone bill, well, that makes zero sense. And it's why I recommend Boost Mobile. Their unlimited plan is just $25 a month forever. No contracts.

Starting point is 01:15:18 hidden fees. No surprise price hikes. If you already have a phone you love, you can keep it and keep your number when you switch. And if you're skeptical, Boost Mobile offers a 30-day money-back guarantee. So you can try it risk-free. Listen, your phone bill should fit your budget, not the other way around. Reaching your financial goals is easier when you can pay less for the same service. Switching to Boost Mobile now is just a smart money move. Go to Boost. Mobile.com slash Ramsey and make the switch today. That's boost mobile.com slash Ramsey. $25 forever requires customers to remain active on Boost Mobile Unlimited Plan. If you enjoy this show and it's helped you, then will you please do us a favor and share it with your friends, with your family, subscribe, leave a comment, just engaged.

Starting point is 01:16:26 Because it is one of the best ways to get to the word out about the show. And because we, I mean, we want to see people win with their money. We want to help them. And if you're listening, I assume you enjoy it. Otherwise, this is like a hate watch for you, which is strange. Yeah, but people do it. Share with your moral enemies. We love you. Share with those who need it the most. That's right. That's right. All right. Let's go to Claire in Seattle, Washington. Hi, Claire. Welcome to the show. Hi. I am so excited to be on here. Unfortunately, not under these circumstances. Oh, no. So my question is, should we disinherit our son completely. And the circumstances, we are the cautionary tale to not do too much or give too much to your kids. So we're retired. We have worked hard all our lives. And my son got a divorce

Starting point is 01:17:22 about five years ago and quit his job. He had addiction issues and needed, you know, to get those under control and lose weight and do all that. And then he went to school. And we supported him through all of those emotionally, financially. He had a daughter as well, supported him through all of that, never did get a job. And we spent a lot of money through all of that. And like probably close over, close and over to three quarters of a million dollars. And we asked him, we placed him, we told him that it was time to get a job. And he quit talking to us and also kept his daughter away, who we raised through a lot of that. Oh, Claire, I'm so sorry. So we're kind of all done because we just cut him off. We just said it's time. You know, it's time. So, and he lives in our carriage house

Starting point is 01:18:24 above our garage. And hard to cut him off at that point when he's 50 feet away. from you. Wait, what? I know. Yeah. He lives above our garage. So he gets, he's gotten free rent, free everything. And, you know, it's like, it's bad. And yes, we take full responsibility for that, you know. It's our fault. No, it's not your fault. He did make decisions. Yes. Were you guys still giving money? Yeah. But also, you were not forcing him to make these decisions or, or lack thereof. That was not you. That was him. That was him.

Starting point is 01:19:04 I mean, we told him that, you know, he turned this into this situation that was supposed to, like, get him started to, you know. So how long ago did you guys cut him off? About probably five weeks ago. Okay. So it is fairly new. And then what's going to be happening with the living situation? Well, he has a fiancé. And we told him he had until the end of the year.

Starting point is 01:19:31 or until he got married to be done with that. Okay. So likely it's going to be at the end of the year. I'm assuming he's not going to be married in the next couple of months? No, unfortunately. So December 31st is his last day living in the carriage house? Is that clear to him? Possibly.

Starting point is 01:19:50 That is clear to him. In fact, we're writing up an agreement to that fact. Okay. And he's not working right now still? He's looking for a job because he has a job. because he has no money. Yep. Yeah.

Starting point is 01:20:03 Well, he did get money from a house. And his fiance is living in the carriage house too? No, no, no, no. She's living in her own house. Okay. Yeah. Woof. Well, that, the positive is that, yeah, when you cut off the source,

Starting point is 01:20:18 you don't have many options but to go and find a job to work, right? So, I mean, that was, that is the right move. And for him, is he in recovery? Has he been sober? Or what's his? Yes. He's been sober for probably four years now. Oh, good.

Starting point is 01:20:34 Okay, okay. Yeah. So you've already cut him off now, but you're saying for the trust, once you guys pass, you're saying should we disinherit everything to him? Well, because he hasn't had a job. So, you know, and then he has to keep a job. So he has to prove himself to keep a job, not just have a job, get a job, but he has to keep a job. And he hasn't been financially responsible with money he's had. And so it's like, you know, that creates a pattern as well because he's been living the life of Riley.

Starting point is 01:21:13 I mean. Well, you're not obligated to leave anything to anyone. You can give it all to a charity if you so choose. But also, to your point earlier, Claire, he is, he was living the life that was, you know, given to him. So I do wonder on his own merits, if you look up in a year, that this could have been the best thing that's ever happened to him. Yes. And you see, I know, I... My gut is, I would not do a full disinheritance.

Starting point is 01:21:43 What I would do is a structured trust that has all kinds of distributions and clauses tied to sobriety and work and education, all of those things you can set up within the trust where he's not getting a dime unless X, Y, Z, are true. Yeah, and the executor of the trust can make sure that these things are, the obligations are hit in order for him to get this money, right? And it's never all at once. It's, hey, at this age or at this, you know, milestone, this much will be given. How much will you guys be leaving, Claire? Like assets wise, like net worth wise, if the house is sold and all that? Over 20 million. Okay. How many kids do you guys have? One.

Starting point is 01:22:31 Oh, it's just him. Yeah. Wow. And his daughter. He's okay. Oh, my gosh. Sorry. In my head, I... So if this doesn't go to him, where would it go as of now? To his daughter.

Starting point is 01:22:43 All to the daughter. Mm-hmm. And I just see the way it's kind of ruined him. Sure. So it's like, you know, we were thinking of possibly a lifetime discretion. trust, which it doesn't, you know, it keeps generational kind of thing. Have you worked with an estate planning attorney to figure out what's the right one for what you're trying to accomplish? Yeah, we're kind of in the throes of that right now. Okay.

Starting point is 01:23:11 But because it's easier to add somebody versus take them out. But it's like, what do we do? I like the idea of it being a structured trust for now. And again, you can always change that in the future because that already has a lot of stipulations before he would get a dime. There's also generational skipping trust to where it would just go to his daughter, your granddaughter. But again, we don't know her future. And so I would still have provisions there. And obviously, she's a minor, I'm assuming. So it would be a while until she could access this.

Starting point is 01:23:43 And Claire, you could do something in it, a clause that says, you know, for the next, like if something happened to you and your husband in the next 12 months that he doesn't get this money for six. years and he has to establish himself for six years before he even sees a little bit of it. You know what I mean? To make sure that there's somewhat of a pattern happening in the positive direction that he again, that where he is today of $20 million got dumped on him, you're exactly right. It would be a, it would be horrible for him. It would not be a blessing. So for him, for the dignity of him and his character to live out a certain way before he, he sees a dime of it, I think is very reasonable. How old is he? He'll be 33 this year, and I'm not excited about his new wife. Well, that's something else to think about. Exactly. What makes you

Starting point is 01:24:39 not excited about it? It is a character thing, a financial thing, that's not a good. I think she's, she might be in it for the rainbow, the gold pot at the end of the rainbow. And so that worries me? Well, I wouldn't worry too much until they actually get married. You know, his track record has not been great with following through, right? But if they get married, I mean, yeah. And this size of an estate, it's going to be cumbersome. It's going to be annoying to have to go back and redo something.

Starting point is 01:25:19 But it would be worth it, right? Like, if you have to make decisions today. It's a $20 million decision. Yeah, I would push it out and make sure that he can't really get anything until, I don't know, making this up 40. Just for him, he needs to hold a job. He needs to learn to work. I mean, all of that so that this money doesn't ruin him. And then if he ends up getting married and there's still feelings towards that, you know, if you have some kind of addendum in the estate with that.

Starting point is 01:25:46 But an estate attorney should be able to work through some of those hoops. But, oh, Claire, I'm so sorry. I know that's such so heavy to carry. But yeah, call us back if you need us. Hey, guys, it's Rachel Cruz. If you're working the baby steps, every major expense deserves a second look. And health care is one of the biggest expenses in most families' budgets. And that is why I recommend that you check out Christian health care ministries.

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Starting point is 01:27:08 Dot org slash budget and promo code Ramsey. Welcome back to The Ramsey Show in the Fairwinds Credit Union Studio. I am Rachel Cruz hosting this hour with George Camel. And we're taking your calls at AAA 825-5-225. All right, let's go to Sarah in Los Angeles. Hi, Sarah. Welcome to the show. Hi, how are you guys doing? We're doing great. How can we help? Hi. So I recently got into some money through a settlement from work. And I wanted to see how I go about that with wanting to pay off my mom's house.

Starting point is 01:27:52 She owes about $200K and then trying to afford a house in the expensive neighborhood I live in. Like, how should I go about that? Oh, wow. Okay. What happened? It was basically just getting almost about maybe about a million dollars. I honestly can't really talk about that. That's fair. That's fair. Okay. So, yeah, that's fair. Sorry. Are you okay? Are you good? Oh, yeah. Health-wise and everything. Okay, perfect.

Starting point is 01:28:22 It's been a long time coming. It's been a long time. I actually started listening to your show because I knew this is coming. and I've been reading the books and listening for the past six months. Oh, wow. Okay. Amazing. So you're getting a million dollars in a settlement. Is that going to be tax or is that all tax-free? Tax-free.

Starting point is 01:28:40 Okay. Okay. And how much do you have in savings right now? Nothing. Do you have any debt? I do about all together with my car and consumer everything, about 31. 31 for you. And then do you rent right now?

Starting point is 01:28:56 I do. Okay. and why do you want to pay off mom's house? She's just, she's done everything for me. I just, you know, I just want her to be stress-free. She's just amazing. I already know her. She's not even going to want me to.

Starting point is 01:29:09 Just as a gift. So this is just like a nice thing. Is she okay financially otherwise? Kind of, they, yeah, a little bit. Kind of not too. They use credit cards and they know they shouldn't. They've talked about that. So, like, they're fine.

Starting point is 01:29:26 They own a house and everything. everything that, you know, they, but. But if you pay off this house, is there any chance they would go take a second mortgage because they need help financially? Not absolutely. My mom is so about being good with money. Good. That's the only always my question.

Starting point is 01:29:44 Yeah, yeah. My mom is instilled. She hated that I even opened up credit cards. She's instilled me not ever doing stuff like that. Like she's even ashamed she had to open one up recently because she's against it. So no, she wouldn't do that. Absolutely not. Okay.

Starting point is 01:29:57 And you're single, no kids? Yes. Okay. So you've got $31,000 in debt to pay off, plus we need an emergency fund. So that's a great place to start. Let's put our own mask on first. And how old are you? I am 36.

Starting point is 01:30:14 Okay. And you want to buy a house in the greater Los Angeles area? I mean, either that or I'm thinking of moving in three years. I don't know if I should just invest the money in mutual funds, like, or keep renting. I guess I just don't know my next move. And also, I should say, I do want to pay off my brother's stuff too as well. Not a lot. Maybe his car, just, you know, I can't not go without paying him. Like, some of his debt off also. Well, see, now I'm wondering, well, now cousin Jerry, he's wondering why you're not paying off his loans too. And dad's going, hey, I'd like to buy a

Starting point is 01:30:47 truck. And so that's my fear is that this turns into people coming out of the woodwork, knowing that you've got some, you came into some money. So I would just be cautious. I love that you want to be generous with it, but I also don't want to enable and cause relational chaos in the family. Right. I'm decided on keeping it between my brother and my mom, and I've decided that's what who's going to know, and that's it. I've kept it that way for years. Yeah. And the way to kind of look at this, too, Sarah, just to think about, it's almost the same mindset as like a lottery winner, right? And I hate to even say that because I know you went through a lot to get this money. I know you just go buy a ticket and win this. But the idea that a lump sum is just given to you,

Starting point is 01:31:30 you know, when we think about money, money is like a magnifying glass. It makes us more of what we already are and our habits more of what our habits are. It doesn't change us. It makes us more of who we are. And so you are a generous person, which I love. I mean, your natural instinct was to like give some of this money away, right? And so you are a natural, generous person. So when a million dollars in the magnitude, that's going to be magnified, which is beautiful. But also, if there are bad money habits, you've got to be aware that this money's not going to fix those. And over time, this money may be gone and the habits still remain. So you do have to remember to change your behavior. You have to have some absolutes in your life. Like, I'm absolutely not going back into debt.

Starting point is 01:32:14 I absolutely will always have a three to six month emergency fund. I will have some absolutes that you fall back on that are different than today. Because you don't have money saved and you do have $31,000 in consumer debt. So I don't want those attributes to be magnified with this money. I want the opposite, if that makes sense. Yeah, yeah, I agree. And that's what it's funny because I've been scared of this happening so soon because I'm like, man, I want to get out of the debt on my own and start doing a refund before this happens

Starting point is 01:32:43 because, like, I've been doing pretty good with not using my credit cards listening to you guys. and, you know, so I agree. I do, this is something I do want to change a habit 100%. Yes. Well, how much do you make a year in your job? Probably around 90. 90, okay. 90 to 100.

Starting point is 01:33:01 90 to 100. Okay. So what I, I don't know, my instinct right now is, I think you're pretty set on helping your mom. So I would be okay. Again, I would tell her not to talk about it because just like George said, I think people are going to be coming out of the woodworks. I would do that.

Starting point is 01:33:20 And then I would pay off your debt and get that fully funded emergency fund in a high-yield savings. And then the remainder, which may be 700, I almost would park in a high-yield savings for like a year. Okay. And just, I don't know. It sounds like you've got some life changes coming up the next two to three years from what you mentioned. I wouldn't buy right now, especially if you're going to. to be moving in three years. And there's a part of me that I would still have a handle on my lifestyle of what I make per year in your job. And again, you're going to have no debt and you're

Starting point is 01:34:01 have a fully funded emergency fund. But learning to live off of that 90 of what you make, I think will create and instill some like very disciplined habits. So that way, if you do choose to pull some money out to buy a new car or something, there's still that constant. rhythm of living within your means. That makes sense. That's a good idea. And if you just park that money, if you park 700 grand in a high-yield savings account with the current rates, you'd probably net about two grand a month just doing that, just letting it sit. Oh, wow.

Starting point is 01:34:35 So make sure it's in a high-yield savings account and not a traditional brick-and-mortar bank. And fairwinds.org slash Ramsey, you can set up a whole smart bundle including that. But I would have wise counsel around you. So if you don't already have these three, you definitely. need them. You need a good real estate agent. You need a good CPA for the tax side because even gifting money to your parents, gifting 200 grand, you've got to make sure that you're filling out the right forms. Otherwise, it's going to go against your estate. And so you may want to be strategic with how you give. And then you also want a good financial advisor as soon as you're talking about making these big

Starting point is 01:35:08 money moves, a lot of zeros on the end. They can help you make sure that you understand what you're doing while keeping you in the driver's seat. So you're going to have to build some muscles you don't currently have. but I feel like the fact you've been researching, I got to watch this show. It tells me that you are very cautious. You want to be wise with this. And go slow with this, Sarah. You know, we even say if people go through an event,

Starting point is 01:35:27 like they lose a loved one and they get life insurance, we say don't make any major decisions for a year and just sit. Because there's just something emotional about seeing that many zeros in an account that you never had before, you know? And there's like, there's kind of a part of you that just wants to just settle in and not make any big major, you know, decisions. right now, but getting some of those people in your corner are going to be smart. But that's awesome, Sarah.

Starting point is 01:35:51 I'm so so happy for you with this. Hey, it's Dave Ramsey. If you or someone you know owns a small business, listen up. What if you could build the kind of business you'd be proud to hand down to your kids? Over 30 years, I've been able to build Ramsey solutions into a business that's going to be a blessing for my kids. I'll show you how to do the same thing at Entree Leadership, Master Series November 8th through the 13th. During this five-day conference, you'll get my strategies

Starting point is 01:36:36 for building a winning business that outlasts you. Visit ramsysolutions.com slash master series for tickets or click the link in the show notes. We wish that we could get to every call and question here on the show. But if you do have a money question and you want an answered, make sure to check out Ask Ramsey. So this is on our website and it's our free AI tool. And built and trained on Ramsey principles. So you'll get the answer the same way as if you had called in on the show. And even some of the follow-up questions

Starting point is 01:37:21 of getting the right information about your situation to give you the perfect answer. It is there. It's amazing. This is a great tool. So go to ramsysolutions.com and check it out. And we'll put a link down below if you're listening on podcast or YouTube.

Starting point is 01:37:36 All right, let's go to James in Boise. Hi, James. Welcome to the show. Hey, Rachel, George. Thanks for taking my call. Absolutely. How can we help? So I have a job working for a hospital making $150K a year, and I have a $47,000 emergency fund, and no debt except for a couple hundred thousand left on a house.

Starting point is 01:38:00 Nice. And God has provided some side hustles where I consult on the side for some hospitals and little hospitals, and most of them pay. And the one, there's always that one. So the one is about seven months behind and charge 1.5% late fee. Now we're up to, oh, about $1,500 a month in late fees. Would you just keep rolling with a late fee or would you press them for the $87,000 mail you? I mean, are they going to pay you anything at this point?

Starting point is 01:38:30 What's been the communication? Well, I mean, I keep saying an invoice. They've been behind before, up to maybe $40,000. but, you know, I think, I don't know if they're just, you know, using the monies, maybe they get more use out of it, you know, than 1.5% than I'm charging them. But, you know, I think they pay on the squeaky wheel, and I'm just collecting late fees. But they've paid the late fees before. They have.

Starting point is 01:38:55 Okay. So there's a precedence here that they're willing to pay the late fees, knowing full well they signed the contract with you, saying we agree to the late fee. Yeah, there's nothing wrong with collecting late fees. They just not quite gotten. Okay. They just not built up quite this much debt yet. Yeah.

Starting point is 01:39:14 It's not fun when someone owes you that. I mean, this is a lot of money they owe you. You said 87,000? Yeah. Okay. Is it a hospital, did you say, or an individual? Hostile. Okay.

Starting point is 01:39:26 Would you be willing to take them to like a small claims court for this? Well, I mean, I don't think I would have to, but I mean, you definitely would. You wouldn't want to just blow this off. Yeah. Yeah, so I would ask for the full. Next month we'd be collecting 16. Yeah, I would go ahead and ask for it. And then I think I would be done with business with them because I think it's just

Starting point is 01:39:45 add some stress and it makes sure your book's all wonky and it's taking a lot of time in your part to deal with this. Well, I mean, it doesn't, I mean, just tack on the one point. I mean, if I'm collecting $1,300, next month, $1,500 in just late. Well, you're only collecting it on paper until they actually pay. Sure. True. And if they do pay, you know, I mean, I had imagined. would. So I can press them for some and they'll probably pay. It's just, I don't know, one

Starting point is 01:40:10 advantage. It's nice when it gets up there, but... Yeah, but it's just a lack of integrity if they're not paying you on time, and it's been seven months. It's not like a mom and pop. This is an actual hospital. Correct. That's making a lot of money. Yeah. So they have the money to pay you. Yes. Okay. I would press them for the full amount and go, hey, guys, I just need this final payment, but where our relationship here is done. And if there's anything in the contract that stipulates after this many months, it goes to small claims court. I don't know what's what they sign, what you set up with them, but I would enforce whatever they signed.

Starting point is 01:40:45 And you said, you feel kind of weird of like, do I just sit here and just like keep collecting late fees? I mean, I guess you could. But I would always have something in the back of my head of like, okay, they owe me. They, like, I don't know. I think I would just add it to the tab. Yeah. I think I would ask for the amount and be done. And then if they want to start over this whole process and you choose to engage that,

Starting point is 01:41:06 then that's one thing. I'd be having them pay up front from now on. Yeah, just for you to have your money. Yeah, absolutely. All right, let's go to Alex in Minneapolis. Hi, Alex. Welcome to the show. Hi, Rachel.

Starting point is 01:41:19 Hi, George. Thanks for taking the call. Absolutely. How can we help? Yeah, so my wife and I are just starting off with the baby steps. We're on step two. Right now we have $106,000 in debt. Of the $106,000, $34,000 is a car.

Starting point is 01:41:36 That car is $12,000 underwater. We want to sell the car and then save up to buy a car with cash. But we're kind of like unsure on how to do that because it's a secure loan. And so if we sell the car, I guess we're kind of thinking that we have to have the $12,000 to look up the difference. Yeah. They can't clear the title until you have that loan paid off. Yeah. So a lot of people go to the actual lender that's holding the loan, and they do the whole transaction there.

Starting point is 01:42:10 Okay. That's the easiest way to do it. Have you got actual quotes on what the car is worth? Where is this $22,000 number coming from? Kelly Blue Book. Okay. And is that private party or trade in? Private party.

Starting point is 01:42:24 Okay. And you've actually looked up, have you looked up listings for similar cars to see if they're actually selling for 22 or if they're listed for more? That might give you a good picture. Okay. And then I would get quotes from every single place possible, every dealership, the Carvana, the CarMax, to get sort of a floor of, okay, I know I can get at least this much for it if I did it this way versus listing it on my own. But worst case, you need to save up the cash or get a loan for the difference from a credit union. Yeah, you may have to go get a $15,000, $16,000 loan just to have some margin to go buy a car, you know, a $5,000 car, pay. this one off and at least that takes your loan from 34 to 16,000. You know what I mean? That

Starting point is 01:43:09 feels better. How much do you guys make a year? Together, 275. Oh, fantastic. Okay. Okay. So either way, you could get rid of all this debt. Yeah, you may not have to get, I mean, you could get rid of the car, but the car's not killing you. I mean, you guys could just pay it off if you want to not go through the trouble of our parameter is, if you can pay off the car in under two years and you love the car and it's less than 50% of your total income as far as all your cars are concerned, then you can keep it. Okay. But the fact that you're wanting to sell it tells me there's another piece to this.

Starting point is 01:43:44 Yeah, I think it's just following the debt snowball method. You do pay off the lowest debt. Like, it would it be reasonable to basically reprioritize the car so we can pay it off within two years? I wouldn't reprioritize it. I would still put it where it falls in the debt snowball. because the truth is your income is the winning piece here. You don't think you can pay this car off in two years, Alex, with all the rest of your debt? No, I don't think so.

Starting point is 01:44:11 Okay. What are you guys taking home every month? Oh, boy. I want to say 13,000. So we're, yeah, we also have six kids. The van, no surprise. It's a mini van. car is in any van.

Starting point is 01:44:32 Okay. Yeah, I would consider keeping it and just going, how can we be more aggressive in other areas? Because you still got to come up with the difference. And so that's still going to be a hurdle. Yeah, what are the debts before the car? Personal loans or credit cards or what are they? Credit card, credit card, personal loan.

Starting point is 01:44:50 We have legal debt. We have a student loan. And then we have medical debt. And then we actually have a substantial tax bill. And the car is the largest. Okay. I would put the tax bill at the top. Yeah.

Starting point is 01:45:05 We always prioritize the IRS before anybody else because they can destroy your life, garnish your wages. So I would attack that first and then do the debt snowball traditionally. But I'm just wondering, if you guys bring in 13, could you live off of, let's say, five or six and throw the rest of the debt? Yeah. I want to say yes. I think that's, I'm sure we probably could figure something out.

Starting point is 01:45:32 Have you guys done a budget, a pretty detailed budget for the month? Yeah, we just started it. I think we're on like our second week of doing it. Okay, okay. Nice. That's great. I'm just doing napkin math and I'm going, okay, if we throw $8,000 at this debt, it's gone in 13 months, just over a year.

Starting point is 01:45:50 Sure. But that means we have to learn how to live off five for our household bills. For one year, can we do that? And it's going to be. It's going to be tight. Shopping a lot of Aldi, beans and rice, rice and beans and beans. TB and J's all around for the kids. Yeah, it's not going to be fancy dinners, but we are, we're going to make it through

Starting point is 01:46:07 and save on the grocery bill with six kids. That's probably where a lot of your money's beating. I mean, man, it. We're shopping in bulk. I'm sure you guys already have to be strategic with the food, but that I feel like the biggest area to save too. Yeah, but if you have this much debt making $275, they may not be that strategic with it. They may just be.

Starting point is 01:46:24 Let's eat out. I don't know. I don't know. So, yeah, places that you can cut things, you can sell. Eating out for a family of eight? That's like $200 bucks anywhere you've got. your chick-flay bill. I can't imagine.

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Starting point is 01:47:17 just 3597. Go to ramsysolutions.com slash store to get the deal. That's ramsysolutions.com slash store. Up next we have Mary in Dallas, Texas. Hi, Mary. Welcome to the show. Hi, George. Hi, Rachel.

Starting point is 01:47:46 Hey. I just wanted to add that I actually grew up listening to Dave Ramsey. So I have low-key resentment for all the Ramsey kids because my parents would listen to something Dave did to his teenagers. And guess what I then had to do with me. I'm so sorry, Mary. My therapy bill is so large. So yours probably will be too.

Starting point is 01:48:08 No, I'm just kidding. No, it's great. So sorry. No, my parents for my graduation present gave me Dave's book, The Whole Money Makeover, and I read it right after I graduated. And I remember rolling my eyes and being like, this is the stupidest book. Everybody knows this. I don't understand why somebody makes a whole much money by writing

Starting point is 01:48:29 the obvious. And then of course, by the time I made it through my freshman year, I was like, oh. Oh, wow. This is it so funny. Oh, my gosh. That's so funny. Yeah, it was the foundation of my marriage, right? Like when I started dating and we like talked about Dave Ramsey and I fell in love with him because he like already had a retirement account. So Dave would be proud. That's hot. That Roth IRA. Philly funded Roth IRA, man. Really. It was like the first thing he introduced me to is like, do you have a retirement? retirement account. I was like 18 and I was like, who's the one? That's what I knew. Oh my gosh. So funny. I love it. So good. So good. So my question is for you. We've been

Starting point is 01:49:13 raising the Dave Ramsey and we kind of use our own language over the 18 years. But like we're in like three, four, or is it three, four and five, right? We're like supposed to be paying off our house. So we bought four years ago in seven years. Like we're doing really well. But one of the things My question for you is how do you go about knowing how much money to put towards a dream? That is kind of my question for you. So you can ask me our finances and you can ask about the dream and how much money it wants. Like what would you like to hear? Okay.

Starting point is 01:49:45 So you're debt-free with an emergency fund and you have a dream to do what? Correct. Just finished writing my fourth novel. Wow. And the third novel, thank you. The third novel I wrote, I've spent the last year and a half trying to find representation. So editing, right, sending it through some things, rewriting, and, I mean, you guys have all published books.

Starting point is 01:50:09 You know the industry is really difficult. And so, like, I sent it to one agent that, like, she was asking for a book. It sounded like my book was exactly right. She was open for a week. And she posted later that she got, like, 800 submissions, right, in the span of a week. So I know this is a really hard process to go through, especially from the blind. So I'm not like thinking it's going to be magical and amazing. And using your method of like getting yourself out there and meeting these agents, right?

Starting point is 01:50:40 It just takes money. And I, as a stay-at-home mom who's like really conscious with our money, I'm having a really hard time putting money towards a dream. I can't prove it's going to be worth it. But my husband is incredibly supportive. Like we literally were just in the car having this conversation where he was like, Dave says if you had $5,000 and it burned, would it be okay, right? He's not wrong.

Starting point is 01:51:03 Yeah, but my heart is, well, my heart is dying. With $5,000, I could make a beach trip, right? It seems really selfish to put it towards myself. So that's kind of I was like, how do you go about thinking about, like, how did you a dream and also like not throwing money at a dream and it being a stinking fund, if that makes sense. You're very wise. And I always remind myself this. There are guys that spend way more golfing.

Starting point is 01:51:27 that are terrible at it and make no money doing it. So just if that makes you feel better with your hobby, that's a good way to think about it. Have you published a novel yet or are they all just sitting there? No. So they're all just sitting there. So I'm not in like a huge hurry, right? I know like if it's not this novel, it might be the next one. That's how a lot of authors work.

Starting point is 01:51:47 But why haven't you published any? Well, you mean like self-publish? Is that what you mean? Yeah. Yeah. On Amazon, they can do, they'll do like the. Yeah. Print per order.

Starting point is 01:51:58 So I have looked into self-publishing. Yeah. So one of the things is it would take, it takes quite a bit of money. And then it takes a lot of like going out and using social media and paying for that to get advertisements and like going and doing stuff, which again, from my research, I haven't seen that a lot of people actually make it that way. And so again, that's kind of the thing where I'm like, I don't know if that seems worth it. I've seen numbers as well with $20,000 to get out there up to $1,000.

Starting point is 01:52:26 One of the things that I was looking for towards that my husband was talking about me doing is like you can go to these conferences and meet agents face to face or like go through these classes where they go through your novel and at the end of it you meet these agents. So it would be getting to be face to face. But again, they're anywhere from like $500 to $500 and there's no career. It feels like a scam. What are you paying money for in this regard? Yeah, don't buy like a $10,000 publishing package where you might get to me. I mean, I would say the agent is not your problem. Think about it like a musician. I know independent musicians who are not on a label who crush it and they own everything they do without

Starting point is 01:53:07 giving up their soul. And I just don't want you to think that a publisher or an agent is your ticket because they might write you a check for 20 grand one time and they never recoup the costs and you never make a dime. And nobody reads the book. So I'd rather you out there hustling, getting in rooms and social spaces where people are reading those types of books, create a following online, and then you make it. Yes. And then either you can choose to keep going or if you have evidence of books that have been sold, that is more enticing to a publisher than someone who hasn't done.

Starting point is 01:53:41 You know what I mean? Had anything sold. They're looking to see, can we sell these books? And if you're an unknown author with no social following, that's going to be a tough time. So I would spend my time building a social following and getting in spaces where, people are interested in these types of books and trying to network as much as I can. Okay. Without paying a dime.

Starting point is 01:54:02 Yeah, who won who has done that. And she did tell me that she has ended up spending like $10,000, like, from like things like going to conferences to get in there, like printing them herself so she can sell them to bookstore. Yeah. That's a better use of your time, buddy. I think that's, yes. But I wouldn't just like buy some package that's supposed to get you in the right rooms. go to the conferences, sure, pay to do that, pay to self-publish the book, but at some point you've got to build a following of people that want to read your books.

Starting point is 01:54:31 Because there's almost 4 million books that are published a year. Totally. And I know you know this industry probably in and out because you've been loving it. It's been, you know, your hobby. So if you have any advice on like, should you like put a number on it and you're like, you go here and then you don't go beyond it or you just go like, here to try this? do it. How much do you guys make a year? We make about 175. 175. Okay. And you guys are I'm also with a homeschool mom. So I like do homeschool. So like again, these conferences that

Starting point is 01:55:07 we can totally do, do add. There are other things that are part of the equation as well. But I can do this on the other side of homeschooling too, right? There's no like time limit on this. But again, my husband's like, feel free to spend money. And I'm like, I don't know. I don't see that it's like proved that it'll actually work. Well, you're not looking for a direct ROI. If I put a dollar in, I get $2 out. What I would do is set goals for here's what I want to do this year.

Starting point is 01:55:33 I want to go to two conferences. I want to do, I want to print 100 books. And then you guys decide. And make 30 social reels and do all the hashtags of book. You know what I mean? Like the type of novel it is and start, yeah, have some goals yet that you're shooting for. But I think the truth is. It's just a lot of work on things that don't cost money, which is creating content on your own

Starting point is 01:55:55 around the contents of the book, which that won't cost you money. It costs you time. But there's no way to leapfrog that and just say, well, if I just put $10,000 in this vending machine, I'll sell a thousand books. Yeah, but if you know that money is going towards conferences that you should be at, you know, plane tickets to get there, you know, whatever that looks like for you and that you and your husband are feel good with, okay, if we put this money out, out. You know, you're, I mean, it's a little bit of a gamble, but you know what? You're like,

Starting point is 01:56:23 what else you're going to do? Like, you guys have done well financially. You're not talking about taking out a $100,000 small business loan to get something started. You're moving at the speed of cash. Grassroots. And just keep reevaluating. So yeah, be okay spending, you know, five, 10 grand, if you guys are good with that. And just say, okay, let's see where this gets me. And then let's talk, you know, March of 20, you know, March of 27. is kind of our next pillar, right? Here's the time lines. Here's what I want to be.

Starting point is 01:56:54 That's right. And just start mapping it out. But I think you'll naturally get weary over time if something isn't happening. And you're like, okay, I am throwing money at this thing and it's not happening. But put some out there. You guys have the cash for it.

Starting point is 01:57:07 And yeah, try to make the dream happen, which is always fun. Exciting. As a fellow reader, Rachel might read it. Send her a DM with the book. Love a good novel. Hey, guys, Rachel Cruz here.

Starting point is 01:57:31 And I love summer. There is more fun on the calendar, more time with your people, and way more chances to make memories. But you know what else there's more of? Spending. Oh, between the extra groceries and gas and camp fees and family trips, it all starts to add up so fast. And before you know it, money stress starts to steal the fun out of everything. And that is why I love the every dollar budget app. Because it helps you plan your money, track your spending, and find more margin in your budget

Starting point is 01:58:02 so that you can put extra cash towards the goals that matter most. Enjoy your summer without the money stress. Download the Every Dollar app in the App Store or Google Play and start for free today. Our scripture of the day comes from Jeremiah 119. They will fight against you, but will not overcome you, for I am with you and will rescue you, declares the Lord. Elon Musk said the first step is to establish that something is possible,

Starting point is 01:58:49 and then probability will occur. Probably will occur. All right. Yeah. It's a very Elon quote. Yeah. I saw probability. Probability.

Starting point is 01:59:00 Is that a tough word? I don't know. It just feels like something Elon would say. I can hear him saying. The probability of this situation, I don't know. I feel like you just like are, you love math. If that's, yeah. That word is used a lot.

Starting point is 01:59:15 Oh, man. All right. Let's go to Kate in Indianapolis. Hi, Kate, welcome to the show. Hi, Rachel. Hi, George. Thank you for having me on the show. Yes, absolutely.

Starting point is 01:59:26 How can we help today? So I just found out that my husband gambled $121,000 in daily trading. Oh, no. So sorry. And, yes, these were the money we had from our previous townhome that we sold, and we're in a process buying a new home. that we paid $50,000 deposit. It's an unrefundable deposit.

Starting point is 01:59:54 So we need to, like, process with this purchase of the new home. So you already paid the $50,000. It's locked into that new house, and now you don't have the funds to put down on top of that? Correct. Oh, my goodness. Okay. How'd you find out? Yeah, what happened?

Starting point is 02:00:11 Well, I kind of, like, I saw, like, the money were not there. He was telling me he invested. and stocks and crypto and I kept asking me, asking him to show me the money, and he's like, everything is fine, the money are safe. I'm like, why did you take the, because we had a deal to put 20% down for the new house, and the rest of the money he would like invest in stocks and cryptocurrency. Yes, so. And so he lied about that.

Starting point is 02:00:43 He was actually day trading? He did. He did. He did lie about that. And it's not the first time. We lost money in the past. Not this amounts of money, but yes, here we are at. So he has a gambling addiction. Has he been seeking out any help for this? Or does he unaware? Does he think he doesn't have a problem? He thinks he doesn't have a problem. He thinks he invest, but he failed at investing. How old is he?

Starting point is 02:01:12 He is 43, and I'm 40. We have two kids. How long have you guys been married? Well, it's been 17 years now. Okay. Do you work outside the home? Yes, I work full-time. Yeah, we bring home together like to 40 a year before tax. What do you make on your own?

Starting point is 02:01:37 About 90 to 100. Okay. And what is he saying this next step is going to be? Because he knows that there's a house. He's saying he'll take care of the payment. He says he's going to pay for kids' activities, and our kids go to private school, so obviously we need to switch them to public schools.

Starting point is 02:01:59 And he says he's going to take care of everything, and I sat down and I showed him, like, financially he cannot take care of everything. Does he still have access to all of your money? No. Not to what I make, no. So you've separated accounts, or has it always been separate? Yes. We separated a while back, but sometimes he wouldn't be on time with payment,

Starting point is 02:02:27 so I would have to cover what he couldn't cover because... How much debt do you guys have? Well, he has personal debt, like $20,000 in my credit cards and also in business loans, like $127. of it. I don't have any personal debt. Are you sure that's all the debt he has? Because what I would do is pull credit reports for both of you from all three bureaus to make sure. That's what he told me. I'm not going off of what he tells you anymore. I know. Yes. So tonight, you're going to pull all three reports from all three bureaus, both of you. Okay. Because you need a full picture of the

Starting point is 02:03:06 damage here, because I think if he's lying about this, there's other debt. And we need a clear picture if we're going to move forward at all. Because I don't know how you're going to afford this house now, because the rest is going to have to be on a mortgage, and he's saying, I'll handle it? Correctly, yes. What's the house cost? It's $5.50.

Starting point is 02:03:24 So you're talking about taking on a half-million-dollar mortgage. Yes, correct. Okay, and he's totally fine with doing that and that you guys will qualify based on your income? Yes. Oh, boy, this scares me. I mean, there's so much more than that. The house is the least of your problems at this point.

Starting point is 02:03:44 Okay. You have someone who is a gambling addict, a pathological liar, who's committed tons of financial infidelity while you have two young kids at home. I understand. So if we don't solve that problem, the house isn't going to fix anything, even if we solve that one. Well, how do we solve this problem if he doesn't see it as an addiction? You're going to need to reveal that to him, and it might take other people to reveal that to him.

Starting point is 02:04:10 I don't know that you can convince him. I mean, regardless of whether he admits it or not, I think you guys need marriage counseling ASAP. We had a session, and he didn't like it, and he said he doesn't want to do it anymore. Well, I think he's telling you something then, Kate. I know. And that's a really sad reality.

Starting point is 02:04:38 He's choosing his gambling addiction over his family at this point. He's opting out of the marriage. Yeah, Dr. John Deloney always talks about how your actions are basically the words you're not saying. And if he's not willing to fight for this marriage, Kate, that puts a hard strain

Starting point is 02:04:57 on decisions in the future probably. I probably would not go through with buying a house with him right now. Because you already told me that he has not been consistent on payments. So what happens when you guys have a bigger mortgage payment and he doesn't have the money because he gamble it all away that month? And Kate, he's in, and from a marriage perspective, he's telling you he doesn't want to work on your marriage. I know. I know. He's convincing me that I don't, like, I see it differently.

Starting point is 02:05:22 No, you're not the crazy one, Kate. The kids call that gaslighting these days. That's right. Yes. He lost $121,000 by quote-unquote day trading. Yeah, before that he lost like $50,000. That's right. Before that, he lost like other, like, 10. Yeah. So there's, and again, I'm always so cautious when we get to this point in a conversation with a call because we have about three more minutes with you. And then you have to go make these decisions about your life, Kate. But, I mean, there's some ultimatums that, I mean, if you wouldn't put up with this if it was drugs, right?

Starting point is 02:05:59 That, well, he, you know, this and this. Or you put something else in the money slots, the gambling slots. Yeah, that's how I see it. And it should be how you feel. And I'm so sorry. And so I think for UK, I would go find a great therapist because I think you're going to need some language and some identity work to be able to stand really strong

Starting point is 02:06:22 for you and your kids. And then he's going to have to make some decisions based on what you need because he's the one that broke the trust, not you. He broke the trust. And so there's going to be some things that he's going to have to do to repair that trust for this marriage to move forward.

Starting point is 02:06:40 and yeah you can't force him into recovery but what you can do is put up from very clear boundaries that you're going to separate your money so that he can't do damage to your family any longer and that if he wants this to continue then he's going to need to see a gambling addiction specialist who can assess him yeah yeah that's how i see it yeah so do we process we have to like go buy this house because there's no way back do we buy it and sell it um because at this point I would talk to the lender and see what your options are and see what the contract you sign says, see if there's a way to get out of it. And you may have to forfeit a penalty or something, but I wonder if there is a way for you to get out.

Starting point is 02:07:21 Because I would not put my name on a house with him right now. I think your marriage is on the rocks. And even if you lost that deposit of 50K, he's done more stupid tax than the last year than that 50K deposit you'd lose. And he'll continue to do it if we don't put an end to this. Yep. Yeah. Yeah, the behavior's not changing on his end. And he doesn't care to change it is what it sounds like.

Starting point is 02:07:40 He'll make 50K in the next three months. So we can rebuild that. But what we need to do is focus on his inability to lead this family well and not destroy them. I'm so sorry. I'm so sorry. But I would. I would find a great counselor in your area and have them walk with you through this process. But I'm so sorry.

Starting point is 02:08:00 Well, thanks for a great show, George. Thanks to everyone in the booth. And remember, there's ultimately only one way to financial peace. And that is to walk daily with the Prince of Peace. Jesus.

The Ramsey Show - It's Never Too Late To Start Over

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