The Ramsey Show - It’s Not Too Late to Get Control of Your Money

Episode Date: September 30, 2025

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Brought to you by the Every Dollar app. Start budgeting for free today. Normal is broken, common sense is weird. We're here to help you transform your life. From the Ramsey Network and the Fair Winds Credit Union Studio, this is the Ramsey Show. I'm Dave Ramsey, your host, Ken Coleman, number one best-selling author, Ramsey personality and host of Front Row Seat. One of the biggest hits on Ramsey Network right now.

He's my co-host. Open phones at AAA 825-5-225. Brooke is in Florida. Hey, Brooke, how are you? Good. How are you? Better than I deserve. What's up?

I need to know today how to ask my parents for money. I work for their business. I manage their business. And there's times sometimes when I don't get a paycheck. from them. I love my parents and I love the work that I do, but I just don't know how much longer I can keep my head above water. How old are you? 30. You run the business? I do, yes. How many employees? About 15. Okay. Are you running payroll for the 15 people? No. I run all the timestamps and then they do it on their automated payment rules.

Okay. So you're not running the business. You're just running, you're running parts of the business. You could say that, yes. I mean, I run day-to-day all the accounts and billings and the management of all the employees. They're just... So you hire and fire these people?

I do. Do any of them miss their paychecks? No. What would happen if they did? they would quit they would quit yeah so why would you not get a paycheck um just just sometimes like sometimes the business does not do well um you're not profitable and yes yeah and we're from a small town we live in a small town and you know we try not to raise our prices too much but you know when it comes down to it we do you're not profitable the town keeps yelling at us why are you not

profitable. Why is it not? Because we don't raise our prices. I thought you were running the business. I am, but I mean, I do raise the prices. I raise it a little bit, but not to anything too crazy. Well, honey, if you're not running a profitable business, nobody gets a paycheck. Absolutely.

So this isn't a mom and dad problem. This is a, you're running a business, sort of. and the decisions that are being made to operate the business are not causing it to be profitable. Is that right? Yes. And so they don't have the money to pay you, and so they skip out on you rather than the other employees. Correct. Okay. And so the fix for this is not a relational problem with your mom and dad.

The fix for this is business acumen, and it's straightening up your dad-gum act over there and decide if we're going to keep this thing open or not. Because a business that doesn't make money is called a hot. recorded hello this call is no longer I have no idea what that was but I'm not participating it anymore um something about being recorded yeah it's definitely being recorded it's a podcast okay so it'll be on YouTube later too if you want to watch it but no you don't have a mom and dad problem honey you got a Brooke problem and so Brooke needs to sit down with mom and dad and go we're running this business poorly I need

some help with that or I'm gonna change some things so that this thing starts making a profit and if it is profitable consistently, and they don't pay you, then you go do something else because your mom and dad have an integrity issue then. But that's not what's going on. What's going on is they ask you to run the business, you're running it poorly. Yeah, and I also think there's, we don't have the backstory here, so this is inferring a lot, but this is probably not a very strong business and just laying it out as simply as well, we're not raising prices. That's not the only reason. I think she needs another job because I think her finances are a mess.

She's underneath it, she said. So this is a situation where you may or may not be able to fix this. And if you can't, I would do what Dave says. But if we can't fix it with a very clear strategy, dial in a few knobs here, then it's time to move on. Yeah. And I see this a lot with family business. People, they get stuck in this because they feel like it's mom and dad's business. I'm the kid.

I got to help. And you refuse to see what you might otherwise see if you didn't work for mom and dad. Well, the number one – I mean, a business that didn't profitable, the number one line item in a typical business of any size, but certainly a small business with 15 employees, the largest item in their – in their budget is payroll. That's correct. They have 15 people getting paid and one not. So I can fix that. We'll have 13 people, and one gets paid. I mean, that's, you know, I don't lay people off around here, willy-nilly.

I do all kinds of things. We've never had to lay off in Ramsey at 35 years. But if we're not making a profit, we're going to make a profit. We're going to stay open. And if I have to cut payroll to stay open, I will. Before I sit around and make no money, because you're not going to stay open eventually if you don't make a profit. This is the whole thing. It's how it works.

It's a math thing. So it's not an altruistic thing. It's not socialism doesn't fix it. your theory about capitalism from your communist college professor won't fix it none of this will fix it well the only thing fixes you have to make money and so and it has to have a bottom line profit and when you've got that then all your theories we can have a discussion about but no yeah it's not a mom and dad problem brook it's you and your mom and dad need to sit down and figure out what have we got to do cut expenses and increase revenues and that's where profit comes from

I want to create some margin in here to where I never miss a paycheck again because I can't miss any more paychecks I'm not okay with missing paychecks. And if we have to, if we have for me to miss paychecks, it's saying to me that I need to go do something else. Yep. And so I've missed my last paycheck. We're going to sit down and we're going to change some stuff here until this happens.

But the way you're presenting it may sound like it's kind of random. It's not random at all. They look down, the bank account's empty. They can't pay you. And that'd be true for the rest of them, by the way. If they look down to bank accounts really empty, well, how they're going to make payroll? They can't. So that's the next thing that's coming.

They're going to miss paychecks to other people. And so we've got to get this thing turned around ahead in the right direction, or we need to close it, one of the two. Or get somebody that wants to work for free to run it because I'm not that guy. Yeah. I hadn't ever asked anybody to work for free at Ramsey ever. Yeah, because here's where this goes. Right now, she's kind of chuckling. Seems like she's in good spirits.

But eventually that becomes nasty resentment for mom and dad. And to your point, they're not being bad parents here. They're just trying to figure out how to pay everybody else, and she's the last one. Well, they don't have a crummy job of communicating and helping to fix it. No question. If my kid is on my payroll and I own the business and I can't pay my kid, that's the first thing I'm going to have a problem with, right? I mean, we're going to be talking about this and all of a sudden I'm going to be down in the weeds with the boots on again. Here we go.

So something's going to happen here. And so I, it feels like mom and dad kind of drifted off and semi-retired. And they're half butt running this thing, and Brooke doesn't know what she's doing, and she's kind of half butt running it. And so there's a lot of half butts in this thing. And that's what, that's what, there's nobody got control of this around the throat. That's right. They did something right to get it to 15 people so they can figure it out. You got to step on it.

Let me tell you, business is tough. That's why they fail all the time. It's hard. It's a series of hard decisions. And you get up tomorrow and you know what it is? is then another series of hard decisions. It's hard. It's tough.

Running your own business is easy. At least you work for yourself. That's the worst boss you ever having your life. Guy's a freaking slave driver. This show is sponsored by Better Help. I have awesome friends. I got a great faith and I have an amazing wife and family. I've also got two PhDs worth of information. I've also got two PhDs worth of information. about how to be well. And yet, the times that I've spent with great therapists over the years have made all the difference for me. The right therapist can change everything about your mental, emotional, and relational health. And this month, my friends at BetterHelp are shining the spotlight

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That's BetterHelp, H-E-L-P.com slash Ramsey. I'm good. I can't believe I'm talking to you guys. This is a total honor. Well, we're honored to speak to you. How can't help? Um, so this is a more of a relationship and more of a family question. So my basic question is how do I get my brother to stop taking advantage of my parents? Um, so context and background is that he is 35 years old and essentially what his current kind of like plan or like lifestyle is he just like saves up a bunch of money while he's living at home with them. for free and then he'll like go on a trip internationally and then once he runs out of money he

comes back and he doesn't have anywhere to go so he just moves back in with my parents again but meanwhile he takes advantage of them and like uses their materials for his business he uses their stuff and he's also disrespectful all at the same time I've talked to my parents about this I mostly talk to my parents about this so I mostly get their side of the story but basically I Why have they not stopped this, then? That's what I've been trying to get them to do. I'm asking you, I'm asking you. What's wrong with your parents?

They will not, they love their son too much. They won't set that boundary. That's not love. Yeah, that's true. This is giving a drunk a drink. That's enabling. It's not love. 100%.

I'm, and so that's what I'm wanting help with is I've talked to them about it, and I've been very straightforward and blunt with them, and I've told them, you know, like, if you are not willing to set those boundaries, then it could cost you the relationship. And so I guess they're not listening to me. I'm wondering if I can talk to my brother specifically and so you can coach me on how to help him. No.

Okay. Your brother's a parasite. They don't listen. 100%. Yeah. So it's, he doesn't have any problems. I know. Your parents are the one that has a problem.

Your brother has no problems. Life is good for your brother. I know. Yeah. Why would he, but your parents' job is to help him have some problems. Yes, I agree. So I kind of sit in this middle world, and I'm wondering, and it's technically out of my control. Exactly.

So I'm wondering if there's anything that I can do to kind of help this problem. Well, let me flip this on you. If I met you and I started telling you about something that was really, really bothering me, You could tell I was pretty worked up about it. And then I said to you, but Natalie, I have no control over it. I can't control anything about this. What would you say to me? I mean, I guess technically you're right.

So. What would you tell me? You could see I'm all stewed up about it, but I have no control over it. What would you say to me as a good friend or a new acquaintance? What would you say? I guess. I'm not sure. Sure you would.

It's kind of frozen. Let it go. Let it go. It's it. You would just say, hey, you've got to move on. And you said you're sitting in the middle of this. You're not sitting in the middle. You're sitting on the side.

You're a spectator. You've actually put yourself emotionally in the middle of this. You have VIP seats to watch this crap happen. But you're a spectator. Yeah. Yeah, so that's what I'm hating is I hate watching my parents. It is really painful to watch people you love do stupid things. Yeah.

Let me tell you what I would do on this situation. and this is like me walking in the living room and my wife and daughter are watching The Bachelor. I just keep on walking. I don't stop. You know? I already know what that.

Don't get sucked in. Well, I just know how awful that show is and how it makes me feel and I feel dumber every second that I watch it. My brain cells just die progressively. But if I sit there and I watch it and I keep griping to Stacey and Josie about it, it's not helping me or them.

Because they're not going to stop. They don't watch. They don't stop. So, yeah, the only thing I could think of is this. Anytime I'm trying to influence someone, the only thing I can do, there's three possible angles. Your brother's not, is zero chance, okay? I would not bother with him at all.

What he needs is a good butt kicking, and you're not in a position to do that, okay? So he needs his butt kicked into the street and into a job and into grown-up land. And that's, you know, he's like, you know, Peter Pan. just never grew up, right? So failure to launch. So now, how do you deal with mom and dad? Number one, I would just tell mom and dad a story about one time that I was doing something and say, you know, I did this, I did this, I did this. And, you know, when I got out on my own, I felt so much better than when you guys were supporting me. I felt better about myself. And so I don't think, I don't think my brother feels good about himself because I think

y'all are harming him. And so you can say something. I don't think it's going to do any good, though, because I think your parents are spineless. Enablers are the nicest spineless people you will ever meet. When I have been an enabler, it's because I have two freaking chicken to deal with the deal. Instead, I just threw money at it, and that's enabling. And I've done that myself, and it's just, I'm always ashamed of myself when I do it, because you don't help the people involved. You actually hurt them.

And that's what your parents are bringing a great harm to your brother, because they've malformed his character in the process, and it's their fault. All he did was just take the path of least resistance. That's all he did. So the second thing I would do is ask yourself, who would they listen to? True. Brother that they trust, uncle that they trust, pastor that they trust, his old army sergeant that he trusts. I don't know.

Who would that? And talk to that person and say, would you go talk to them? Because I can't get through to them. And then the third thing I'm going to do is I'm just going to pray. God, mess them up. Mess this up. Lord, cause a chaos over there. Let the basement where brother lives flood, Lord.

Yes. Break his car, Lord. You know, Lord, Lord, bring some problems to this situation. Please, God. And just pray hell down on them. And it's just, I'm serious, because that's, that's what's going to, something that's going to bust here. And I, around Ramsey, even when we're working on projects, we always say, break it before it's broken. And I'm just going to ask God, break this for it gets broken, because it's going to get broken.

It's going to go sideways. And it's going to be ugly when it does. And it'd be better off sooner than later. Yeah. My guess is your parents are afraid of him. You mentioned that he's disresc- Yeah. Physically?

He hasn't been physical with them, but he has broken stuff in the household. before. I'll call a police on him. But they're more afraid, not of harm. I think they're afraid that he's going to abandon them. When you see parents that are enabling, and I've seen this so many times, there is a fear that the child is going to abandon them, reject them. And so you're saying, yes,

so you've seen this. So I'm only pointing this out because today's point, it's going to take a really special person with real, real authentic leverage in their life to get them to see that this is what's going on. That they're actually, you know. They're terrified of it. The best I've ever done with an enabler is to convince the enabler that they're actually doing harm because they think they're doing good. That's right.

Well, they think they're avoiding something bad when what they're doing is creating the bad. I can't put them out. He'll be homeless. Right. Praise God. Right. Yeah. It reminds me of the prodigal.

Don't let them eat. Yeah. Yeah, it's like the Bible and stuff. Yeah, let them go. And then when they come back, have a nice rove and create a feast. But at some point, the fear of what their life is going to turn out or turn into is got to be bigger than the fear of them being mad at you. And that's a really, by the way, I don't say that flippantly. No, that's a tough choice.

You get to ask that, if you're raising teenagers, you have to ask that question every morning. That's right. You know, I have to explain to them, listen, my job here is not to be, not to make you happy. my job here is not to be your friend my job here is not to be the cool dad because i didn't sign up for that one either my job is to raise you into a good adult so you can leave that's my job and then when you leave you can come back when you bring grandbabies this is how the world works okay and so but you cannot live in my basement and make grandbabies it doesn't work that way so you need to leave otherwise we don't get grandbabies this is so and i have to train you in how to do that

So you have to brush your teeth so you have some. You have to take your tests and get grades so that you can get a job and make money so you can bring back grandbabies. Yeah, this is the, there's a goal here. It's a circle of life. Desired future, right? Dave, we got a lot of calls on this show. Dave, we got a lot of calls on this show where life happens. One day someone's healthy, they're working.

providing for their family, and then a curveball hits. You know, we hear it all the time, a car accident, a cancer diagnosis, a heart attack, and suddenly everything changes. Yeah, and that's why you've always said that having term life insurance from Xander is essential, because it protects your family if the worst happens. Yeah, that's right. You need 10 to 12 times your income in coverage, no gimmicks, no whole life junk, just straightforward term life protection. But there's another piece that people often overlook, and that's long-term

disability insurance. Yeah, it's important to understand the difference between them. Life insurance steps in when you die. Disability insurance steps in while you're alive, but can't work. So it replaces a large part of your income so the bills still get paid while you get back on your feet. Now, if your employer gives you free disability insurance, great. Take it. If it's discounted there at a better price, take it. But if not, Zander can help you find the right plan. Whether you're single or married, it's not optional. If you're going to be out of work for a while, then you need to make sure the money still showing up. And that's why Zander is our go-to. They make it super simple to get the right coverage at the best price, no pressure, no upselling. I've trusted

Jeff Zander and Zander insurance for over 25 years, and so is my family. So don't wait. It's fast, it's easy, and it could make all the difference. Go to Zander.com or call 800-356-4282. Protect yourself, protect your income, protect your family. The all-new every dollar is here, and it is a game-changer, boys and girls. Watch the premiere on our YouTube channel and see the app in action. By the way, that premiere is pretty incredible. Here are how folks are finding thousands of dollars in margin in just 15 minutes using every dollar's new features. So imagine how much you could find to put towards your money goals.

Thousands of dollars of margin in 15 minutes. The way we have built this thing out, it's going to walk you right through the Ramsey plan. From debt to millionaire. That's the process. Baby step all the way out, baby. We're going to guide you, hold your hand, answer your questions, push you, prompt you. prod you and all those kinds of wonderful things because we love you the all new every dollar check it out boys and girls and check it out on youtube all right kala is in mississippi hi kala how are

you hey i'm great good how can i help okay well it's kind of a dispute that my husband i've had for a really long time and he thinks that our house and our land should be including our network but i don't because I will never, ever, ever sell my house on my land. I mean, no matter what happened, I would not do it. And so he thinks it should be included in that. And so for that reason, he has a high net worth for us, I mean, really high. And I don't think it's a high because I would never sell it. Okay, it does, it, Kayla, I'm sorry, you're wrong.

Oh, no. Yeah, so the, I'm sorry, you lose the argument. But here's why, okay, net worth is not about whether you sell it or not. net worth is simply what something is worth. The definition of net worth is an accounting function. It's a math thing, not a feeling. Okay? And it's not a wish or an intent.

It's not what you plan to do with it. None of that really matters. They don't ask that question in accounting. All they want to know is what you own minus what you owe. Assets minus liabilities equals net worth, period. That's your net worth. Now, now you can say, what's my liquidity, which is your, argument, your liquidity is the money that you would cash in or use if something came up,

and in your case, you would get rid of your husband before you got rid of the land. You made that clear. Not quite that extreme. Almost, almost. I mean, we're not sure at this moment, especially since you lost the argument now. But, yeah, that's it. Oh, no, that's bad. What's so special about this land?

It must be family land. Well, it's the thing he wants to retire. He's like, we have this huge net worth in a hundred. I want to retire, and I'm like, we have money. Okay, now that net worth does not necessarily mean you can retire. That's true, okay? Because what we need to retire is we need net worth that is creating an income. So if you're farming the land, then you would be creating an income with it.

But it's just sitting there going up in value. You can't eat that. You're right. Right. You're right about that. That part of the argument you win. Okay. So if your net worth is too off center on one thing like dirt, in your case, then you can't eat at retirement.

That won't work. So what is the rest of your net worth not counting the land? It's in 401 case and Roth IRAs, and it's $2.7 million or thereabout. Well, darling, he can retire. I don't see trial because he makes like $200,000 a year. Well, what do you think $2.7 million will create? Well. 2.7 million of 10%, it's $270,000.

That's where I have the disconnect. We've only ever saved, save, save, saved, and we've never taken anything else. And so I'm like, really? We need to check his back for the lash marks. I'm telling you. But you're sweet. I think he's smiling. You're smiling the whole time.

Yeah, you're smiling the whole time you kick him out and they were mourning to go to work. Get your butt up, go to work. How much is the land worth? That's hilarious. It's what? I'm sorry, what? What's the land worth? Oh, the house and the land together will probably be around $800,000.

Oh, well, that's not even the larger part of your net worth then. Huh, interesting. No. But how old is your husband? No matter whatever happens, I'm never leaving here. We got that, okay? We got that early. Don't question that.

So did he, by the way. So the question is this. How old is he? 62. 6-2? 62 that's right okay so sit down with your financial advisor and ask them if it's him it's him okay well maybe you need to get one that'll help you guys both look at this and say because if I were your financial advisor I could show you how you could invest that money

in some decent gross stock mutual funds which I got a feeling he's already done and it would create 10 to 12 percent rate of return and so you would make 200, 200,000 without even touching the nest egg. Without even touching the 2.7. See, if 2.7 makes 10, that's 270 without touching the 2.7 every year, right? Yes. Okay. See, that's without touching the nest egg.

And he's 62, and, you know, if anything really goes wrong, you can sell the farm. No, I'm kidding. I couldn't resist. Yeah. It's too easy. His underhand pitch is T-ball. Never, ever, ever. Ever.

Ever. No matter what happens. Ever. Nuclear apocalypse. Guarantee you, Kayla's on the farm. You guys have done a wonderful job together because you're fun and you're focused and you don't spend money. You save money. And he's done a wonderful job if he's been the one managing this, growing it at 62 to have 2.7 plus an 800,000.

So your net worth 3.5. Way to go. Mississippi. I love it. I'm proud of you. You did great. Now, if he wants to retire, he can afford to retire. For sure. I don't think he had much choice. I think Caleb made that poor guy save and invest, which is good, which is good, good for him. Well, that way, they don't have to sell the land. I thought it was going to be some, like, massive track of land worth millions of dollars. I thought they had 2.7, the land's worth 20 million or something. Yeah, I thought It was $800 grand.

There might be a price you would consider. But she does make, I'll tell you, the conversation is a good point for everybody listening, though, okay? When you have to have enough of your net worth tied up in income producing assets to be able to live off of that income. In their case, it's a very simple formula, 2.7, 10%, it's 270, right? but let's say you had 2.7 and it was in real estate that was generating rents. Are the net rents, net of all the expenses enough to live on? And are you okay with that? And those of you that are small business people, you need to have assets outside of

and in addition to your small business when you retire. No, that's my retirement. No, that's not your retirement. That retirement has to be done something. Then you're going to put your kids in debt when they try to take it over from you because they got to buy the old man out because the old man hasn't saved any stinking money. So you need some stinking money. You need to have invested and create income producing assets that you can live off of at retirement.

So one of the guys, I ran through my head, one of the guys we found was worth $12 million in the, when we did the millionaire study. Yeah. For the millionaire next, not millionaire next door, that's Tom Stanley's book, my book, Baby Steps Millionaires, right? And so that study, one of the guys, he was one of the, he was an unusual millionaire. And that's why I remember him. he bought a track of farmland he was a farmer um in kansas for cash and then the next year he bought another track and then the next year he bought another trek and then the next year he bought another track he had 12 million dollars in dirt oof dirt and if he's not farming it it doesn't create an income

it goes up in value probably yeah because it's apparently good dirt right but uh he and he's been doing that but if you've got it all tied up in dirt You know, we had a family one time we were coaching in Entree leadership. They were third generation, and they started with like 500,000 acres in New Mexico. And it was part of a land grant thing three generations ago. And every generation, they had to sell off blocks of it to pay the estate taxes. And now we're down to the third or the fourth generation, and they're all trying to live off of this land, only it doesn't create an income. But they have this massive net worth to Kayla's point, she makes a good point, but no income.

And they sat and argued what they did about what to do next because basically the thing between someone trying to eat and the federal government taking estate taxes every generation, the half a million acres had been disbanded and it was gradually eroding. That's so sad. Because nobody ever bothered to create an income. You've got to create an income and you got to do that. So she makes a great point on that, and she was a lot of fun. That's great. Hold on, folks. Don't panic. Buying a home in today's market doesn't have to be complicated, but it does take more than hope and a quick Internet search. To get the right home, one that will be

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This is a paid advertisement, an MLSID 1591, and MLS Consumer Access.org, Equal Housing Lender. button follow button click that button uh the share do some sharing sharing yeah share the show tell people about it just with your mouth or clip clip out the uh cut out the uh you know the link and send it to a friend and go listen to these guys they're a little crazy but they're fun and i'll learn stuff so there you go hey we appreciate it if you'd spread the word for us it helps a bunch we know a bunch of you do that because our numbers are up ridiculously we appreciate you very much andrew's in Washington. Hi, Andrew. How are you? Hey, what's going on, guys?

Better than we deserve, sir. How can we help? So I just got married in August, and my wife and I are looking at buying our first home. And right now we're putting, you know, doing what you get to say, putting 15% of our income into retirement. And because a home is an appreciating asset, would it be okay with the exception of the 401K because we get matched? would it be okay to pause contributions to retirement and to put that towards a down payment on house? Yes, but not because it's an appreciating asset. I assume you're out of debt, everything at this point.

My wife has about 10K in student loan debt, which we're planning to pay off hopefully by the end of the year. Okay, and do you have an emergency fund of three to six months of expenses? yes okay all right well you only got part of the ramsie message then so let me kind of fill in the gaps okay baby step one is you save a thousand dollars anything above a thousand dollars that you have you apply to consumer debt and you lean on consumer debt anything except a mortgage until you are 100% debt free when you are then baby step three is you build a an emergency fund of three to six months of expenses only then do you start investing for retirement

So you would stop investing for retirement today. You would take your emergency fund and pay off your $10,000 today. Okay. And then your first goal is to rebuild the emergency fund to three to six months of household expenses. Then if we want to do a house down payment, we start saving for a house down payment, and I'll give you the nuances to that that kind of weaves back to your question now that I cleaned it up, okay? All right. So at that point, let's revisit where we're.

are at that point. You're 100% debt free. You have an emergency fund. And we have not yet restarted the 15% baby step four going into retirement. You with me now? Yes. Okay, when you're there and you should be there like by Friday. I mean, I don't know how quick it's going to take you to build that emergency fund back up, but it might be three Fridays from now, but you're going to get there real fast, okay? I don't know. How much is in your savings? Not counting in return. With retirement? Not counting retirement. Gotcha. Probably like 15 grand. Okay, good. Yeah. So you're debt-free with five grand in the bank today. Did I understand that right?

Okay. Okay. And then you build that to three to six months of expenses. What's your household income? About 120 a year. Cool. What do you think your monthly expenses to exist are? Probably in the 2 to 2,500 range. I think that's probably right. So let's call your emergency fund 10 grand minimum. Okay. You could call it 15 if you want to, but for purposes of arguing how. So we've got to put $5,000 back into there, and then we've got a $10,000 emergency fund,

or a little more if you wanted to do that, and we're debt-free. Once you're there, then you have the question of, do I save for a down payment versus putting money into my 401K? Now, people, and that's what we call baby step 3B, because the 15% going into your 401K is baby step 4. Is this all tracking? Okay. Yes. Okay, good. Now, so at Baby Step 3B, anything in there is permissible. You could do zero into retirement, even if there's a match. You could ignore your retirement for up to three years, build a huge down payment and buy a house, then start Baby Step 4. That's one end of the spectrum. The other end of the spectrum is sometimes people put 15% away. And while they're doing that with no payments, they still save for their down payment. That's the other end of the spectrum. Or you could land in the middle and take your match and then save for your down payment above the match, right? Which is kind of the way you were leaning the way you phrased the question.

Yes. Yeah. And that's okay. Any one of those is okay, but just don't do nothing for retirement longer than three years. Okay. Long than three years, got it. Yeah. Yeah.

So even if you do 3% in there, let's get that down payment saved up pretty quick. Now, when you're doing the house, it'd be great. It's probably very hard to do on your first house. And you guys are in your early 20s, aren't you? We're 28. Oh, mid-20s. Okay, late 20s. Okay.

So good. So on your first house, it's very difficult to do this. But if you can put down 20%, you avoid what's called PMI, which is private mortgage insurance. Yes. And that's $75 a month per $100,000 borrowed. So you start talking about, you know, we're going to do a $400,000 mortgage. You suddenly got $300 a month in PMI only. And it's nothing more than foreclosure insurance that protects the mortgage company if they foreclose on you.

It benefits you in no way. And they don't charge that to you if you put down 20% or more because they're not at risk, they think. They've got enough equity coverage. So if you can put down. that much. It saves you a ton of money. But sometimes people really want to get a house. They want to get a house. They're moving fast. That's okay. We're fine with that, especially on the first house. And then while you're doing that, no more than a 15-year mortgage, no more than a fourth of your take-home pay on a fixed rate 15-year mortgage. And that's the whole smear right

there on your question, more than you ask for. But you're tracking and you're really thinking about it. You're being intentional. I think you're going to do great, Andrew. You can tell, by the way, he's asking the questions. It's very thoughtful. The only thing I would say to you, and you didn't say anything that would make me think you're going to do this, but be careful of the temptation to overbuy that first house, you know, because everybody kind of wants that bigger house, a little bit better. You just got married in August. So while you're saving, also keep some discipline in mind that this is not our forever house. Don't get sucked into buying in a place that's too much of a stretch. I cannot tell you how many calls we take on

this show where somebody just overbought. And they're like, now what do we do? Because we're three months in, and the high has worn off, and we are upside down, and we just cannot afford this. So be very, very careful on what you buy as a new couple first house. Yeah. Forever house is code for I just bought more than I should have. Yeah. That's what it's code for. Because there is no forever house. I'm 65. There's no forever house. The only forever house is heaven. Okay. That's it. The one Jesus, the mansion Jesus is building. That's my forever house. The rest of them, they ain't got a mortgage and there's no property tax on that. So that's it. So you just you buy what you can

afford because you're going to move. You are going to move. The average house sells every 5.5 years in America. I'm sorry, 6.5 years. The average mortgage pays off every 5.5. Except for our friend in Mississippi, we talked to her. She's not moving. She's not moving. Everybody else. Everybody else is moving. She's bringing the average up. She's bringing the average up. Kayla. Kayla's bringing the average up. Kayla, that good memory, Kayla, that's right. Everyone else, though she's bringing the average up yeah yeah but yeah i mean sharon and i have averaged i think about 14 years per house per forever house yeah so if you want to know how long forever is it's somewhere around 14 years i asked you too i was like because i loved your other house

like selfishly speaking it's the greatest place in the world to hang out in it on a tennessee evening overlook it was just i selfishly i didn't want you and the sunsets were the off the chain And I didn't want you to move, but you didn't ask me. Yeah, well, you weren't paying the bills up there. That's right. Well, I said you, I go, what, what are you doing? You go, ah, we need a new project. That's what you said.

We're a little bored. I go, man. Been there 14 years. It's been forever. He had too many great sunsets, apparently. So that'll tell you. This actually proves your point. You were like, as magic, as majestic as that location was, you were we thought

I would die in that house when I built it. See? I actually did. I thought it was my forever house. I never say that because I hate that phrase. But I actually thought we'd own it. But it was just, it was a ridiculous property, and there was a chance to get a ridiculous price. And so, sold to the man with the bigger checkbook.

You did. And so, there we go. If only you were as strong as Kayla, you would have held firm. And I'd still be up there enjoying those sunsets. That's true. Not to be, though. You could probably go off there now, but you might get arrested. I knock on the door.

Hey, do you mind? Hey, no, don't even knock on the door. Just let him come home, find you on the back porch. Hey, don't worry. My friend Dave. I'm checking the sunset out. He used to own it. I used to come by here all the time.

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get 20% off at JoinDeletMe.com slash Ramsey with Code Ramsey at checkout. So do that today. JoinDeletMe.com slash Ramsey, Code Ramsey. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio with Ken Coleman, number one bestselling author and host of the front row seat. As my co-host, I'm Dave Ramsey. Ryan is in Nashville. Hey, Ryan, how are you? Good, Dave, how are you doing? Better than I deserve.

What's up? Well, I had a question about retirement in 401Ks. I am new into a Roth IRA. I'll be 50 next year. And I can only contribute so much to that. And on my wife's 401K, we're maxing out what she can do a year on that. And then there's a rollover IRA from previous employment that we have. So we've got the three things working for us.

But I can only contribute, you know, just that $7,000 a year. And I would just like to do what you think other ways for me to try to, make my money work for me down the road so I can have more retirement yeah you can bump it to 8,000 at 50 and you can also do a spousal Roth for your wife as well are you doing both of those so we can do that if she has a 401k plus she has a roll over IRA yes what's that called I'm sorry just a Roth just a Roth she can do one too she can do a Roth yep even if she's not working she could do one but she's working in this case so make sure is her 401k a Roth uh no i don't believe well yes it is it is okay all right because if they match the portion they

match is not roth but make sure it's not traditional is the roll over raw is the rollover ira has it been converted to roth i don't think it's been converted it's just a roll over okay if you convert it it'll make the taxes on the amount come do what's the amount in there the amount on the rollover currently is probably about 75 okay so you would have about $15,000 or $20,000 in taxes, probably 15. If you get it, so if you got an extra 15 to invest in retirement, I would roll that to a Roth and pay that 15 in taxes and call that investing. Here's why, because from this point forward, it will grow completely tax-free. Okay. So that paying those taxes now is like investing into a, into a retirement.

So if you're looking for more money to throw at something, the first thing is you bump them to eight, you do a spouse, a spouse will make sure. her 401k is Roth, if it's not already, and then take that rollover and, you know, talk to your tax person and figure out what your taxes are going to be before you do it. Make sure you've got that much in extra cash to pay your tax bill next year when the April rolls around because you're going to have an extra, whatever it is, 15 grand or so on that, and then roll that 75, and then 7 years will be 150, and in 7 more years it will be 300, and in 7 more years will be 600, and all of that will be tax-free if it's Roth.

It won't be the way it is now. It's going to grow, and all of it be taxable at ordinary income. So you do want to move that at some point. But if you're looking for extra ways to put money towards retirement, that's the ways you can do it. Matt's in Tennessee. Hey, Matt, how are you? I'm doing great, guys. I'm so excited to be on the show.

Thanks for taking my call. My pleasure. How can we help? Well, my wife and I have been weighing to do. decision of making her a stay-at-home mom. And I just want to make sure we're not letting emotion blind us from making a bad decision financially. Cool. Good for you. How many babies you got? Uh, we have two. Okay. Uh, they're both under three. Awesome. You got your hands full. Never a quiet moment at your house. Yes. Okay. So, um, yeah, it's great. Um, I just

kept the grandbabies last week that Sharon and I did that are that age and say I know what I'm talking about for just a moment there but I can hand them back when they're broke you can't so um this one's got something wrong with it you don't need to work on this one yeah but the uh anyway the uh what does she make um she makes 95 gross and what do you make I make um I'll be on track to make over $150. Okay, cool. If you want to be really, really sure, an easy way to do it would be just live on your check for three months and bank hers.

Yes, sir. We've been doing that. Oh, you have? Okay. I mean, minus daycare. If you got daycare, you could take daycare out of hers, because you won't have that. Yes. But if you just practice, so you've already proven to yourself, you can do this.

I guess so. I mean, I guess we're just a little nervous to take that leap of faith. It's not a leap of faith. You've proven it. It's a step. It's a step. It's not a leap. Yes, sir.

How much margin do you? A leap is I have no idea, and I've never even looked at the math. That's a leap. This is true. Yeah, so you're done great, man. So what does she do for a living? She's a nurse auditor for Jimena. is she a nurse by trade yes sir okay i think ken and i would both recommend that she do enough of

something to keep her search alive while she's at home yeah we've both talked about that as well we want to keep her um her license up to date absolutely absolutely and you'll be amazed at what she could pick up as just little side things here or there that make a lot of money you know she's got like the perfect career to do what you're talking about about doing I couldn't agree more I mean she could pick up if y'all got in a pinch or something she could pick up weekends in the in the ER and make almost as much she's making now this is true be very uncomfortable and I'm not recommending doing that and you don't have to because you've already proven we can live on your income so yeah just do it man do it this is what the this is you this is why

you manage money to get to live the life you want to live and you guys want her to be home and she's doing nothing wrong and everything right by doing that. Yeah, my question is, is Dave was walking you through this. You just, you still seem to unsure. Is that because you're worried about some big giant expense coming out of nowhere from the giant in the sky or you are too tight on just your income? No, that's a good question. We're not too tight on my income.

What makes me nervous, Ken, is I started this job. in June and it's a phenomenal job it it provides very well it's it's given us a great financial bump I guess it just makes me nervous to solely rely on on my job having been being in it for such a short period of time yeah what do you do I'm in medical sales oh dude yeah you land another one you can land you can land backwards on your head and make 150 in that and the next job job. If these people lose their minds, you can get another job doing this. Once you've done medical sales, you're so qualified, it's unbelievable. You both have selected excellent careers. You'll be making 250 in three years, dude.

Yes, sir. If everything goes well and I stay on plan, I should track to make over 200. Yeah, absolutely. Well, the good thing coming out of a decision like this is you're going to be extra motivated. And I appreciate you sharing the fear. And I didn't need to know. I wanted you to hear yourself say it. And so what you need to do now is go, okay, if this makes me a little nervous, is there any evidence that it should make me nervous? And in this case, the answer is no. And then to Dave's point, you can crush it, man, so go crush it.

And here's the other thing. You guys can decide, okay, we're going to stack up a little extra money, oh, just a little rest easy money. No, we're not saying you have to do that, but you can to kind of ease yourself into this. You guys get to decide how and when you make this transition. transition. And everything goes sideways. She walks down there and picks up a nursing job. I mean, if you lost your job, she picks up a nursing job, y'all can eat. It's okay. It's not like it's permanent. You keep those certs, though. Keep everything up to date. Hey guys, if you're already shopping at Aldi, way to maximize your grocery budget. Good for you. Now, here's how to level up your savings. Make Aldi your first stop every week.

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Dylan is in Idaho. Hi, Dylan. How are you? Doing well. How are you, Dave? Better than I deserve. What's up? So my wife and I are in a little bit of a pickle. We are trying to get financially smart and get out of debt. We have two vehicles that, are financed, and we owe more than their worth, I guess, at least on one of them.

The other one we could probably break even with, but we don't quite have, like, the cash or capital to then buy something cheaper in cash. Okay, on that one, the one that's break-even, what's the payment? $120 a month. Okay, for what? years? What kind of car is this? It's a 2014 Volkswagen Jetta. And what do you owe on it?

66, I think. Okay, I'm sorry. You owe 60, oh, 6,600? Right, yep, 6600. Oh, okay, I'm just kind of mighty. All right, my math brain was about to explode. Yeah, I'm not 56,000, sorry. Yeah, no, not quite. I thank God. So $6,600 you owe on.

on the $120 a month. And what do you owe on the other car? We owe $14.9. And what is it worth? It's worth probably $11,000. Okay. And so what do you guys make? I make about, I guess it kind of varies on month to month,

but it's usually around $6,500,000 a month. What do you do? I do line work. And then I also have a, I work for a farmer on the weekends. Okay. And what's your wife do? She's a stay-at-home mom. Oh, how many kids?

Just the one, eight months old. Oh. And what did she do before? She was in the medical industry, a CNA, medical assistant, lobotomy. Okay. All right, wow. All right. those cars are not killing me because you hardly owe anything on them,

and neither one of them are expensive cars. In other words, like 20 grand sets you free, my man. Sure, yeah. And so I think instead of worrying about selling the cars, I think I just get 20 grand. So you're making about 70, or a little better than that, gross, and we need 20, and you're working. What are you getting paid on the farm? gig on the side? It's 25 an hour, and if I work consistently every weekend, it's 70, twice a month,

$750 every other month. Yeah, okay, good. Excuse me, every other week. Yeah, yeah, that's what about it. That's good. So you're getting a lot of hours. That's good. Can you get more with him?

I potentially could. He doesn't run on Sundays, and so I have three-day weekends with my main job. And so I do Saturdays and Mondays within. Okay, that's good. So I guess I could work more hours in the day, but as far as getting another day in, I, you know, don't really have that option. So here's where we're going, okay? The hole that you're in with the two cars is not huge. It's a good-sized hole, but it's not massive.

You didn't call me up with 66,000. You called me up with 6,600. Okay. I'm making $70 plus $25 an hour on the weekends. And there's a potential for her to do some remote work while the baby's sleeping at home with the C&A. A lot of potential for that. I'm looking at nine months, if I heard the numbers right, nine months, you're paying off that $6,600. Yeah, if you guys lean in and don't go out to eat and don't go on vacation and sell so much stuff that the kid thinks it's next.

And so, you know, you just get real scorched earth on your life and 100% goes towards her car. and you get it paid off, and then 100% goes towards your car and we get it paid off. I mean, do you have any money in savings? We've got like $1,000 right now. Okay, so you got your baby Step 1 going. Very good, Dylan. Right.

And you guys are in your early 20s? Yep, I'm 24. She's 21. Yeah, perfect. Okay. Well, I've got to tell you, I'm not thrilled and you're not either with these cars, but I talk to a lot of people that got it a lot worse than you, man.

Yes. So I think you dig straight out of these. and keep them. Okay. And let's try to be debt free. So you need about $2,000 a month and you'd be free in 10 months. So squeezing out of your budget and adding an hour or two to her day, an hour or two to your day here and there and living on nothing and thrown $2,000 a month out of your budget, a detailed budget on every dollar. And I'll give you a year's worth and get you started here, okay, with every dollar.

so you can get in there and it'll cut the new every dollar will coach you up and show you what to do next but it's going to lead you right through what I'm talking about let's get those cars paid off as fast as possible I think with the math you're giving me Dylan I'm keeping them and I'm going to pay them off I agree I love that because he's going to learn something and by the way I want to see this about every dollar to you Dylan and to our entire audience this new every dollar is way way way more than a budgeting app I mean this is literally coaching you through every one of the baby steps it is so incredible Dylan, you're going to love this because you're now in this journey. And if you walk this out, like Dave said, and let every dollar be your coach and guide you through, because that's

what this is now, you're going to come out on the other side way ahead of everybody else. And I'm a fan, Dave, of young couples paying off cars and driving them until you have to replace them. Yeah, and then pay cash for the new one. That's what I like. The next one. Yeah, because it teaches you to delay gratification. Yeah. Which is hard for American couples to do. Yeah, but they, man, they're perfect to do that because they're not, again, they didn't call me up 66,000, which most people do. Although for a half second, you thought it was there. Oh, I did. I was reaching for the Tums immediately. There's a Volkswagen Jedi out there for 66,000 somewhere, I promise you. So, yeah, that's just, man, I felt bad for him. But I mean,

this is doable. This is very doable. And, and, uh, what do you think the average household has, because you said something that we skip over too much, and I'm going to bring the audience back to what you said. The idea of selling, they think it's a one-liner, but it's not. Selling so much stuff the kid thinks they're next. What do you think an average household in America has in their house worth of stuff that they could sell? Any kind of guess? You know, that couple's not been married long.

Yeah, they don't have a ton of stuff. So they're not as much. But, I mean, Americans, we collect crap so much that we get a storage bin and pay rent on a storage bin. for the crap we haven't touched in five years. I mean, we're unbelievable. We are the biggest bunch of hoarders on the planet. So, yeah, you've got enough crap that you could put on, what is it, a Facebook marketplace or whatever, anything.

Just put it out there and get that stuff sold. I don't know. But I think the longer you've been married, the bigger the accumulation, for sure. I bet it's close to two grand. Oh, easy. Easy. Yeah, you can get your baby step one, your $1,000 and one week into garage selling. Yeah.

For sure, most of you. Yeah. And then in addition to that, you start popping the other stuff on. But people will buy stuff. I mean, I talked to a lady, God, it's a couple of years back, but, you know, eBay was the thing for a long time, right? Everybody's popping stuff on eBay, which is still fine. There's still not a bad place to sell stuff.

Facebook marketplace is pretty much competing with it. But this woman was going to garage sales and buying children's clothing for a dime and a nickel and a quarter for a shirt. And then reselling it. And then reselling it for three days. on eBay to the tune of like $10,000 a month income. You can get out of debt fast with that. I mean, it's just, but you talk about crap we all have.

I mean, you know, and this is all like, you know, this is this clothes. I mean, you think about a four-year-old how much they wear out clothing. They don't, they grow so fast that they don't, they wear it three times and they can't get in it anymore. And you can, man. How do you think George Camel has that snappy outfit? But he's buying middle schoolers' kids' clothing, and he can wear it. He's repurposing it.

He's not here to defend himself. That's terrible. It's awful. He'll get me back. That's going to cost you. I know. He'll get me back. That's going to cost you.

You broadcast that over the live microphone, Ken. Listen, he looks good. He looks good. He looks good in Oshkosh, Dave. You know, he does. Hey, gently experienced clothing, there is nothing wrong with. A lot of us grew up with experienced clothing. Oh, man.

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work. It's a scam. And I guess that just came from the college, the communist college professors. I don't know because I don't know where it came from. It didn't come out here in the real world because out there in the real world. People are leaving the cave killing it and dragging it home every day. I don't hear a lot of whining out here in the real world. It's mainly in think tanks and in social media about people who live in their mother's basement. That's about the only place I hear that capitalism is really dead because it's actually the best time in human history to be alive. It's easier to build wealth now than at any time in history.

Your health is better. Your access to information is quicker. Your ability to launch into a new thing. The training is unbelievably fast. Everything about it. So we did the largest study of millionaires ever done in North America at that time just to find out where millionaires are. really came from. And we found that 89% of them, that's 9 out of 10, are not millionaires because

of inherited wealth. So if your broke brother-in-law doesn't agree with that, this is data. It's a fact. He's what's known as wrong. So that's it. That's a fact. It's a statistical fact. We did a study of people that was overdubable what it needed to be in size to be statistically significant. We know about research. We have a department that does Ramsey research, and we had an outside firm look over our shoulder because we knew the lefties would go crazy when we've discovered that capitalism was alive and well. And so we had to go, no, you're just, I'm sorry, you're wrong, darling. I'm sorry, you're wrong, darling. You don't know.

Once again, you don't know. This is where it really happens. So we started also interviewing actual millionaires on the air and have continued that. We call them Baby Steps Millionaires, because a lot of them have followed our baby steps. maybe steps to get there. Not all of them, but a lot of them have. And so we get to talk to them occasionally. Jennifer is in Fort Worth, Texas. Jennifer, what is your net worth? $1.5 million, which still blows my mind to say out loud. I love it. I'm so glad you said it out loud here. I'm proud of you. So what's the mix on that?

What is, what, what, how many dollars of retirement house, that kind of stuff? Give me the breakdown by category. The bulk of it is in my husband's 401K. It just rolled over a million dollars i've got a little bit along the way but i mostly have been self-employed so most of our retirement is in his nest egg we've got 350,000 in home equity and then the rest of it to non-retirement you know emergency fund cars savings accounts that kind of thing very cool how old are you we i'm almost 52 my husband just turned 52 so yeah and what person i've been out just a minute i know based on what you've are based on what you told me about how it's mixed up i know the answer to the question, but I'm going to ask you anyway. How much of this was inherited money?

Not one single penny. Zero, precisely. Nothing. We grew up dirt poor, and we have been working for a lot of years. And, of course, last month, it was our 10-year anniversary of coming in doing our debt free scream live on air with you. Oh, wow. Yeah. And now you're worth 1.5 million. Hmm. I like it. I'm like, oh, let me hold on to something. I like it. I like it. I like it. Very cool. How long y'all have been married? 30 years. Okay, and during that 30 years, what's the range of your income, lowest year to highest year?

The very first year we were married, we were still college students, so I think we might have managed to eke out $15,000 that year. When we got our first grown-up jobs, we were about 60, and this year we're rolling over $300,000. Cool. And what are your careers? My husband's an engineer, which, you know, goes with the territory, and then I'm a psychologist. I've been in private practice for a lot of years, but now I'm a college professor, so.

Ah, very cool. Very cool. And what was his GPA, do you know? Um, he was right about 3.5. Okay. And what was yours? Undergrad was 3.14. My grad was 365. Okay. Perfect. Okay. Good, good. And what do you drive? Um, so, uh, my, my husband's in a 20, 2020, uh, Rav 4, Toyota. I have the Dave car, which, you know, I love because we have no payments, but it is a nice little sporty car. Lexus, U.S. 200, F, Sport, 2019, red leather seats. All right. It's the bonus for being debt-free.

I like it. I like it. Well, you both got decent cars, because a lot of times I don't talk to millioners, I have to tell them to go buy a car. And you guys are both in pretty good shape on your cars. Good. That was part of our problem is I like new cars and shiny things a little bit too much back in day so now we drive them with no payment very cool very proud of you oh man what

do you tell people if they're out there listening and they're the you guys are 52 you've been married 30 years and they're just getting started so they're 22 23 can they still be a millionaire today in America no absolutely why the biggest the biggest piece of advice that I'm going to tell them as well is don't hide your journey from your kids one of our biggest goals was to change our family tree. And in fact, we made shirts to that effect when we came 10 years ago. Our kids journeyed alongside us. We did the smart money, smart kids, you know, with the kids during COVID. We did, you know, the homeschool personal finance material with our older two,

who were 13 and 15 at that point. I'll never forget my 15-year-old saying credit cards are stupid. She is going to be 21 this week. She's a college student. Our middle one's a college student. they are both going nearly 100% scholarship, they'll be debt-free walking out with their degrees instead of the six-figure student loan that I had. It's important that you know what your priorities are, right? And so we actually don't even own all the house we could afford our house. We still have a bit of a mortgage, but it's like 15% of our income so that we can, you know, travel and enjoy life and help our kids with the rest of their tuition and our youngest is in a Christian school because those things are our priorities

and being intentional and you talk about that I know a lot is important about why you're doing what you're doing and not just the next shiny thing which I mean that took us a while because my husband and I neither one are sabers but I mean we're showing pictures of you guys on YouTube like in Hawaii and everywhere else so it isn't like you lived in a cave and collected lint and only came out on triple coupon Thursday the Hawaii trip, every about three years or so, we try to take a super, super nice vacation, and the Hawaii trip was a reschedule. It got canceled initially because of COVID. And then both of our HCA units went out, and then our water heaters exploded. And then we had to have the foundation on the

house level. And I just stomped my feet and said, stop taking my Hawaii fund, because we kept having to raid the vacation fund to fix the house. And then we finally saved up again, and we were able to take that trip this last January with the kids and had an amazing. But now you're 52 with a $300,000 income. Yeah. And you are worth $1.5 million. I'm so proud of you. Way to go, kiddo. Very cool. You know, one of the things you hear in this and I want to make sure everybody catches it is there's an unbelievable discipline, but don't miss that what fuels the discipline is a vision for their future life. And it was so fun to see the picture 10 years ago in our old building. Remember that spot so very well. And there they are. Kids are little at that time. They're

elementary. And now we get to hear this call on the other side of that. And you heard what I love about what she shared their day was HVACs going out, House Foundation, stuff that would break people who are broke, break them in every way. And they weathered it, got on the other side of it, and now they're on their way to crush it. So this is the real story that you don't hear in those clickable articles or in the TikToks and the Instagrams because there's so much more to this story. So really heartening and really inspiring to hear this call. Yeah, as we did that study of millionaires, the thing she was referencing was the top five career choices of millionaires. The most often that appeared to be millionaire is engineer and her husband's engineer. So very interesting.

number two was accountant, number three was business executive, number four was teach, number three was teacher, I'm sorry, number four is business executive, number five was a lawyer. Medical doctor didn't even make the top five. They were number six because they're notoriously bad with money. And so, but incredible, incredible stuff. Why do we tell you guys all this? So remind you, you can do it. You can do it. You, talking to you, you, you, you got to make choices. And then you can win. Big news you just heard, I'm sure. The Fed cut rates for the first time all year.

The 15-year fixed rate mortgages have dropped to the lowest we've seen in 11 months. If you're financially ready, you're out of debt, you have your emergency fund, a good down payment. You're ready to buy. This is a good time to buy. House prices have been holding pretty steady. They've gone up a little, but not like they're going to. If we see these rates drop on down, market heats back up, you're going to see the house prices take off again. Really good time to buy.

It's also a great time to sell. So buying or selling a home is possible if you work with a Ramsey trusted real estate agent, and you'll be glad you did it. The pros are handpicked by us to guide you through the market. They're high-octane, high-protein, get-or-done people. Find a local trusted pro, a Ramsey trusted pro, for free at Ramsey Solutions.com slash agents or click the link in the show notes. Alexis is in Oklahoma. Hi, Alexis. How are you?

Good, Dave. How are you? Better than I deserve. How can we help? Well, my husband and I are about with credit cards and students combined about $25,400, $98.96 in debt. He's the only one currently working. I am a stay-at-home mom, two, three little ones, and I'm going to school. So things are tight here. And busy. How old are the little ones? Uh, four, two and a half and ten months.

And why are you going to school? I'm going to school to be a teacher just to finish my degree. Um, yeah. To be a teacher. Yeah. Okay. I know. No, there's nothing wrong with being a teacher.

Yeah. I'm just confused. You have three little ones in your stay-at-home mom. Why are you going to quit doing that and go be a teacher? Um, maybe. Yeah, my grandma, she passed away from cancer a while ago, and she just really wanted to see me graduate, so I'm kind of doing it for her again. Well, that's great for her, but you're broke. Yeah, I know. And you can still do it later, but right now, how much is this cost you?

Give us real numbers on this degree. How much is it costing? So, right now, I'm getting FASFA on financial aid, and I have a scholarship to where I get $1,500 split each semester. So my semester is probably about $6,000, a little bit more each semester, and then after I graduate and I get a teaching position, they'll pay me $4,000 for five years. Yeah. And I'm a junior. Okay.

But you're going to graduate with no apparent use because you're going to stay home with the kids? Possibly, yeah. The only reason they're doing this is grandma has nothing to do with your life. Yeah. Yeah. Yeah, I know. I mean, I don't want you to not get the degree, but you called me up broke and stuck. I know.

And you're going to school for a degree that you're not going to use. Yeah. Okay, anyway, so what's your husband make? He makes $2,493.52 a month. Good Lord. What does he do? He's an apprentice for an electrician, but he's currently taking, like, the test to become a journeyman. he can make more. When? He takes it again, November 1st. He took it last weekend and missed it by two points.

Okay. So when he goes to journeyman, as soon as he passes his test, November the first, so another month, what will he be making then? Right now he makes about $19 an hour. I think it'd probably go up two more dollars. And then whenever he gets his full, this is just as limited. I think he could go up to $40 depending on where he worked. Man, his job sucks. Yeah. It's horrible.

You can make that at Target without passing a test. If you can fog up a mirror, you can make that a target. That's the only test they've got. Mm-hmm. But this is for sure what he wants to do long-term, correct? Yes, yes. Well, that's part of the process. He has a long-term goal.

Yeah, no, listen, that's the only way to do it. but he's got to bring in some more income while he's doing that. We're not just going to keep $2,400 bucks. You're starving to that. Yeah. Yeah. And you need to pause this education plan if possible. I don't know if you can even do it right now. You're already committed for the $6,000, right?

Yeah, yeah. Okay. As soon as this semester is over, you push pause. Yeah. Okay. Until you get your family upright. Because y'all are starving to death because you're not working. the time you're spending going to school, you can spend tutoring at $40 an hour.

And he's got to take some weekend hustles where he's making $30 or $40 an hour because he's getting screwed during his day job until he gets out of this journeyman stuff. Yeah, he did that this weekend. He made about $400 extra this weekend. Good. Like every weekend, starting now, ready, set go. He has three little babies and $25,000 in debt, and he's making nothing. You guys are below the poverty level.

And it's because of your income choices. it's not because you're lazy but you're three kids in Oklahoma you're below the poverty level on his day job that's how bad his job is yes and thankfully our house is paid off so we don't have a mortgage and we have to go far paid off my grandfather I saw that we were uh suffering so he offered to pay off it but it's like I am slowly paying him whenever we can oh so it's not paid off no or it's either that or my inheritance if he passed away before okay well um he said don't worry about it so i'm not um yeah i'll just let the uh payment occur at at death um yeah you guys have an income problem huh that's your problem and so once you solve your income problem you're

to solve all the other problems and that's where all your stress is coming from is and it's it's math thing it's not saying you're doing something wrong or you're lazy or anything like that you got three little babies and you're trying to go to school i'd have three little babies and i'd be tutoring and he needs to be working weekends and everything he can get his hands on and if he doesn't step up into something pretty quick in the trades at 30 bucks an hour he needs to go a different route because you know 30 bucks an hour is a minimum to be moving around in the trades right now not 19 an hour and you get a 50-cent raise if you pass a test, give me a break. That's asinine in today's world.

So, I mean, you can, because you can walk over to FedEx and throw boxes, man, I mean, and make, what, 20-22, right? Yeah, yeah. I mean, he can definitely be making more. What I don't know in that particular neck of the woods is what is the standard process for moving into that journeyman role. Each state is different. Each local economy is different on that. So I'm not sure. Well, what he's doing is just running down the union path.

Probably. But he could go, he could take the same stuff he's already been doing and go over there and wire houses residentially with the guy across the street that is an electrician, get his electrician's license and make 30 bucks. That's right. That's right. And so this, I'm not going to lay in this union thing for very long if it doesn't start paying off. He could be making more than 400, even on a weekend. I mean, he needs to be doing that up in this income.

Yeah. And then seriously, we need to. either get the income up there or pick a different track with the trade that he's in. Yeah. Because there's just not enough money there. And it's not a union thing, non-union thing. It's a math thing. If the union's not paying whatever else is paying, then the union don't get the deal.

It's that simple. And so it's supposed to be there for you, but it doesn't always work that way. So, wow. Wow. Ouch. You know, listen, I'm not trying to be controversial, but, and here's another thing. like I all right I'm not going to qualify Dave you may not even like this but I'm going to say it I think you got to be responsible as a young couple um if you aren't earning the income to be able

to provide for three little kids then that's got to be you got to be smart about that and let's let's hold off on the kids until we can actually take care of them because it is it is to me inexcusable to have three little ones uh and be below the poverty line in the United States I think there's got to be. I'm not picking on. I'm just saying you've got to be responsible. And that may be a controversy you'll take, but you've got to be able to take care of the people you bring into this world.

And think of that ahead of time. Think of that. Not just, hey, let's go. Let's do this. Let's start a family and then not have a plan to take care of them. Yeah. But the difference is one or two phone calls and the whole thing changes. I agree.

In terms of income. But I'm saying get some urgency. If you've done that and you can't take care of them, then nothing else matters. Yeah. Take care of those little ones. Your obligation is not to your employer. Your obligation is to your family. Yes.

If your employer is not cutting the mustard with their pay scale, kind of change. And so I don't care that, you know, if that pisses you off if your union, then just get pissed off. It pisses you off if you're non-union. It's fine. Just get pissed off. That's fine. But the deal is this. You got job one.

Like Ken said, job one. What's up, guys, George Camel here. If you've been thinking about making a real difference in your community, this is your moment. People are drowning in money stress right now, and you can be the one who helps them by leading a financial peace university class. It's totally free for you, and we hook you up with all the tools and support you need. So if you're ready to help people ditch debt, save money, and actually sleep at night, go to FPU.com slash lead to learn more. That's FPU.com slash lead. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio.

I'm Dave Ramsey, your host, Ken Coleman-Ramsey Personality, number one best-selling author, is my co-host today. Thank you for being with us, Triple-8-8-25-5-2-2-5 is the number. Melissa is in Florida. Hi, Melissa, how are you? Hi, good, how are you guys? Better than we deserve. How can we help? So, basically, I am in babysat 4, 5, and 6.

I just recently paid off my last step. The problem is that I've done step one through three twice now. And the first time I did it, I ended up getting another car loan. And then, of course, I had to restart again. So now I'm at the class. I did. I did. But you know what?

I learned and I moved on. Okay. Glad. That's good. I'm in it again. So now I have this fear and that I'm going to go back again. So I'm really kind of struggling how to plan my budget to include those things because last time we had just paid off a car, it got totaled, rear-ended and totaled, and then we had no car. Wow, you didn't have insurance?

we did but oh you just didn't like the amount that the insurance gave you and you wanted a better car yeah so it's not the rec's fault no no okay no um so the car was was worth more to us than the insurance company and and um we ended up with um not enough to replace what we had so we not true not true no no no no no you got to quit telling yourself lies okay The insurance company pays market value for a car. If they don't, you should sue them. When a car gets totaled, they write you a check for what the car is worth, which means by definition you could go buy that car with that amount of money. That's the definition of market value.

And so they did give you enough to buy that car. You just didn't want it. Oh, well, yeah. I mean, I couldn't go out and buy that same exact car. Yes, you could. That's market value. you didn't you should have sued your insurance company okay you understand that they're supposed to give you market value for the car when you total it that's that's what the insurance policy is for you

understand yes I do understand now now that you told me that I never thought about it that way I just assumed this is the situation we're in and I just I didn't think of yeah what are you so afraid of you're this is all mindset stuff what are you afraid of happening again that you're going to somehow fall back into it. What is the fear? Probably my ability to make decisions. Are you single? No. I thought you said we. Yeah, okay. So where was your husband during all of this? We were doing it together. Okay, so I'm afraid about our ability to make decisions then. Yeah, maybe. Okay. I make a bulk of the money. choices. So I do include him, of course, but he's more like, oh, you're better at it,

you do it. So I have control over everything, I think. Okay. So let me tell you when you will never go back in debt again, when you decide that you will do anything to never go back in dead again. When you decide I'm going to live on less than I make for the rest of my life, And no matter what happens, no matter what we make, no matter what the circumstance, no matter what the tragedy, no matter what the drama, we are going to live on less than we make. We are never going into debt again. But that is a, that's a principle-based decision. It's not a math thing. Because 100% of the time that you make that decision, your transmission is going to go out next week. And God says, this is a test, like the emergency broadcast system. You remember that? This is a test. Yeah. And you're going to flunk the test. If you don't have. this drone, you know, it's pinky square spit shake. It's, it's, you know, we're doing a contract here with ourselves for our own good. And you've got to decide that that's more important than a little better car. That's more important than no matter what comes at us, we don't borrow money. That's what Ramsey's say. And you've got to get to where you say that. And then, then you go, okay, something came at us,

we can't borrow money because we don't borrow money anymore. So now what are we going to do since this thing came at us and we don't borrow money? How are we going to fix it? because we don't borrow money. And you've got to get to where that's the way you're responding as a mindset to life as it comes at you, whether it's opportunities or the other ones, is I had a guy bring me a deal the other day that was several hundred million dollars more than I have. And he goes, well, you could just leverage. And I'm like, dude, who do you think you're having lunch with?

I mean, really? You've got to be kidding. What planet are you on that you think I'm going to borrow money for any opportunity or any threat. There's not anything I want bad enough to do that. And when you kind of get that going down inside of you, that's the only thing. There's no fail-safe. There's no amount of cash that will keep you from borrowing money because some opportunity will

come along. You'll get greedy. Oh, I've got to be in on that. FOMO, right? Oh, I got to get that. That's a sweet deal right there. I don't want to miss out on that. Oh, oh, oh.

Or you'll feel like you're pressured or I was forced or something. something bad happened, a totaled a car. And then there we go again. Yeah, the tone that I hear from you is you just don't trust yourself. And I just don't know why. And I think there's probably something deeper there, but you've proven it twice now that you could work this process. Now, you fell. You mentioned that you fell. You got back up. And now here you are back in four, five, and six. But the issue is the very nature of your question implies to me that you just don't believe that you have any that you can't do it. And your life says otherwise.

Now, I don't know what's going on way back. It might be worth digging in a little bit. But this idea that I'm going to call Dave and Ken and how do I make sure I don't do this again? We don't have any magical answer because for us, we've made this big decision, as our friend John Maxwell said, make the big decisions early and spend the rest of your life managing that decision. So at this point, you've got to say, am I serious about this decision? And then do I believe with great conviction that I can manage this decision the rest of my life? Same thing with marriage and saying, I'm not going to get a divorce no matter what.

Come hell, high water, we're going to figure it out. I'm going to be healthy with my weight, whatever it is. Youth ministry, we used to say it. And then I said it to my kids when they were teenagers too. Like the time to decide whether you're going to have sex before marriage is not in the back seat. That is completely correct. You've got to decide like months before the back seat. because if you don't decide before you get in the back seat, you're going to have sex.

A hundred percent chance. Yep. Okay? There's a hundred percent chance. Man's been doing that since the time began, okay? If you're not going to, if you're going to say, I'm not having sex before I get married, then you have to decide that and stand on that long before the heat gets turned up. And so you've got to decide before the heat gets turned up, I'm not borrowing money.

I'm going to live on less than I make. And by the way, your husband needs to step up. You're better at this. how about the two of us are better at this than one of us by ourselves Larry Burkett used to say if two people just alike get married one of you is unnecessary you need to be working together on this and bringing both your strengths and weaknesses to these decisions and you'll make better decisions in the multitude of counsel there's safety

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manage. Go to Y-refi.com slash Ramsey. That's the letter Y-R-E-F-Y.com slash Ramsey might not be in all states. Today's question comes from Brett in Texas. I've worked for a large fire department for five years. I love my job, but the department is having a lot of issues right now. Our pension is apparently over $1 billion underfunded. The city takes 13% of my paycheck from my pension and they do not, excuse me, and they do match those funds. I don't have a saying how the money is managed or used is a poorly managed pension, a good enough reason to consider leaving. I had always dreamed of making my career here, but with the pension and a few smaller issues, I'm left wondering if I'm currently a passenger on a sinking ship or if I should

get to the lifeboats while I still have time. Dave, I have to bring you in here. I think it's enough. My answer would be, yeah, it's enough to leave if you feel like the whole thing is a mess, which it sounds like it is. But does he have the option on the city taking? Can he opt out of that? No. That's what I thought. So he's stuck. It's not the pension going down that bothers me. It's the 13% of your income that make you put into something that's going down. That concerns me. Big time. So in order to keep this job, you have to take 13% of your income into the middle of the floor and burn it every week. And hope that it's there. That's what he's saying, right? So no thank you because 13% of your income invested in a 401

1K will make you a millionaire, and this won't. So, sorry, man. Yeah, you've got to go to a different fire department. That one's not run well enough to keep you around. And a billion underfunded? Feels like that should be a new story. That's a lot. Sounds like Illinois or Chicago.

Do you have any sense of how that happens? Yeah, you do too. Yeah, that's what I thought. It's called piss poor management. Well, I think it's almost devious. is what I'm getting at. Yeah, there might even be some shady stuff. I don't know if that's a all shucks or a, we know what I'm doing it. He says he's in Texas. Texas, yeah. We're in the crap in Texas is something around that poorly. It just feels like somebody's doing something. That's a major metro area for it to be that far. A billion. I mean, you don't get that in, you know, the little suburb. But you're probably, yeah, you're probably just moving to a different fire department. My man. That's the thing. Golly. Wowzer. That stinks. Cindy is. with us in California. Hi, Cindy. How are you? Hi, how are you? Better than I deserve. How can I help? Well, me and I have been are at odds with some

money that we received and we are in babysit four-ish. We're just started putting more money into my Roth, Ira, like the one I have at work. And then we're going to max it out yearly. We have 285,000 left of this money, and we just need to pay off our house. Okay, good. It's $260,000. Great. Great, but he's laughing, mind you. The thing is, is that he wants to invest it because we're really not set up good for a retirement,

which on some level I agree with. but when do you best to have the house paid off we have a loan that's how old are you guys i'm 58 he's 56 okay and how much do you have in retirement um probably 60,000 wow I guess yeah we're not really well what's your household income well his is 115 that's his pension that's his pension He has a pension at 58. 56. And so what's his income? Does he work?

No. Why? Because he recently had some extreme medical issues, and he had to repair early. So, and it's... Is he going to make it? Yes. With the gross of odds, Yes, yes, yes.

Is he going to be able to work in the future? Not really. Why? But, well, because right now we have to wait about a year. It was a double lung transplant. Okay, well, that makes sense. So, yeah. That's pretty severe.

I said that's pretty severe. Yeah, yeah, yeah. So what do you make? about 48,000 and how much life insurance do you have on him um i think i get 100000 100 100 100 okay all right so um if he passes away financially you're in really bad shape does the pension survive him do you get it if he does yes yes oh then you're not in really bad shape okay no see and and i i see I don't plan to retire any time soon. Oh, you can't.

You know where we live. I mean, it's horrible. California money is like our insurance bills are ridiculous. So, but that's why I wanted to get rid of it. But our house payment is 1247 a month, and it's a 3.1025. What's your house where? 460. And we owe to the last statement said 260.

Where in California? California, are you? I go up north. Oh, okay. But we're also in fire countries, so that is another huge ginoma. Are your family around you? Why are you there? Yes, yeah, no, and we are married to the hospital we went to, and so we wanted to originally

move that we had different plans. Okay, all right, so the answer to your question overall is that you are better off if he lives or if he dies with a house paid off. You're better off going into retirement with a house paid off because there's two things you need going into retirement, a large nest egg. In this case, you have a pension and $60,000 and you're going to start putting an old house payment now that you don't have any more into your 401ks and Roth IRAs. And you're going to start to grow those rapidly from this point forward because you don't

have a house payment anymore. But when you go into retirement, you do not need to still be owing $200,000 bucks on a house when you've got the ability to pay it off. And the number of millionaires that we have interviewed that said the way we made, the way we got rich, the way we caught up on our retirement investing was we didn't pay off our house and instead invested the money. And that made us rich. The number of millioners that said that was precisely zero. No one does that, that has money. Right. The people that have money get out of debt and use the increased cash flow because they don't have a house payment anymore to build wealth with. And that's what you guys should be doing

in the middle of all this. Wow, have you got your hands full? Yeah, I don't know what you say there. I hope with his double lung transplant, the hope that on the other side of this, he can do some work, because again, it's all about catch-up at this point. Yeah, you just need income. Yeah. But with no house payment and her income and his pension, in his pension, you can go ahead and start making some progress and then hopefully, as young as he is, he's going to be able to add to, you know, collect his pension and make more. doing something. Obviously, he's not going to be doing some extreme physical thing. Am I crazy to be a person who goes, look, I don't care how much families around us.

If I'm making a comment like that about how expensive a state is, I'm going, what's three, four hours away where we can dramatically change our living expenses? I get being close to family, and I'm not going. She said they're married to the hospital, too. I didn't understand that. Well, I mean, the lung transplant, they're tied in. That's their medical community. You've got to be there. For a while.

For a while. Yeah. But in general, I'm going to make changes to my life to reset if I have to. I don't care how close family is to me. No, that's what people have done. That's why millions and millions and millions of people have moved. Yeah. In America.

And I think they all moved to my neighborhood. But, yeah, yep, yep, yep, yeah. No income tax and, you know. Do you make them sign a... a statement of living? Well, I'm trying to get a law passed in Tennessee that you can't vote until you go through a proper voting class on how to vote properly. But nobody's, nobody's buying off on that.

So I don't think I'm going to get elected. Because you're a native Tennessean. I don't think I'm going to get elected. You're one of the few in Nashville. You could do your own course. Yeah. It's just proper voting. Hey, guys.

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If someone in your life depends on your income, you need life insurance. But how do you choose? Well, it's actually simple. Life insurance is one job. It's to replace your income if you die. Term life insurance is the least expensive and the only kind that does all. only that. The others, like whole life or permanent life, try to add investing. They end up doing everything poorly. That's an understatement. You only need life insurance when someone

depends on you financially. So if you're like most people, you need a policy worth 10 to 12 times your income for about 15 to 20 year level term insurance. Level means the premium stays the same. For more info and resources, use the free term life insurance guide at ramsysolutions.com slash term life guide or click the link in the show notes. Jim's in San Diego. Hi, Jim. How are you? Hi, Dave.

I'm honored to speak with you and Ken. You too? Certainly. How can we help? So I've got a question for you. My wife and I are very blessed. We were both 30 years old and married a little over a year. We've got about 800,000 in non-qualified assets and another $400,000 qualified assets.

And we're going to be getting an inheritance of a, million dollars. And we're looking to spend it on, it's a little less than a million, but for rounding purposes. Um, we're looking to spend it on a house and use that, you know, a million as a down payment and get about it, either a $600,000 loan. I'm uncomfortable with any kind of loans. The last debt I had, or that we both had was actually my student loans, which I paid off at this point. Um, and I'm apprehensive about getting a mortgage, especially a $600,000 mortgage. And that question is, do we take the $800,000 and apply that to the $600,000 mortgage and pay off the house in cash of $200,000 remaining in brokerages and bank

accounts? Or do we use that $800,000 in the brokerages and bank accounts and use the dividends and basically liquidate some of the assets every year? What do you make? Both of us combined are about $200,000 in salary and with another $120 to $160 and bonuses and commissions. Right now we're living well underneath the $200,000. But you make $350, and that's where you got the $800 is you're saved like crazy. Yes. Okay.

So you're maniac savers. Way to go. That's cool. And you're risk-averse, so you're avoiding debt and you're saving both. That's pushing you. And you're doing really well with your careers. Way to go, man. congratulations such choices to have to make so the house the house you're living in what's it

worth oh we're thinking it's going to be well no the house you live in today where do you live today oh we're renting right now yeah what's it worth that's about 2,900 a month as a rent yeah what's the house that you're renting worth oh it's an apartment oh okay so you're renting an apartment this 2,900 a month okay and you've still been able to to with a $36,000 a year rent bill, been able to save hundreds of thousands a year? Yes. Pretty incredible. I mean, what could you do if you didn't have a monthly housing cost?

Wow. So you're moving from an apartment to a million six, but a million six in San Diego is no palace. It's a nice house, but it's not a palace. Yes. Correct. It's not a million six in Abilene. It's a million six in San Diego. so um but again it's a nice house i mean it's probably the average i think the median now is about

six or seven hundred in san diego and the median nationally is 422 so um yes that's that's a problem so you're about double or a little over double the median in the area hmm okay very interesting so well the way we look at it is simple uh in your situation i would not buy the house unless i paid cash for it. Okay. And the reason is very simple. There's multiple reasons, but there's the first one that comes to mind is you'll take the increased cash flow and grow the money back in no time.

Okay? Okay. And because it's just the way you're wired. Number two, the damage that having a mortgage does to anyone is multiple. applied when we talk about you because of the way you're wired. If most people felt like they put 300 pounds on their shoulders doing this, you're going to feel like you put 1,000 pounds on your shoulders. Yes.

And it's going to start affecting everything negatively. Okay. And in ways that are not necessarily directly attributable. Okay. Here's what I mean by that. Okay. One of the things I've discovered in my business career and watching people over these years with their careers in general is people make much more positive career decisions when they're not forced into it to make a payment. And so they don't stay in negative toxic environments.

Instead, they move to better environments. And people, so people that live debt free end up prospering in their careers more because they can say, take this job. rob and shove it. Gotcha. Okay. And you're going to be like the multiples of that because you're like the ultimate, I hate debt-saving nerd guy, and I love you for that. But debt would do more damage to your spirit than other people's, is what I'm saying.

Because of who. Yeah. Because of who you are. My wife and I are very risk-averse on the debt. Yeah, she is, but she's not anywhere near like you. I mean, you're off the chain. You're off the chain. In a good way.

It's nothing. I think it's awesome. I am too now, but it took me a while to get there. But I mean, you know, you're there. And it's caused, look at the cause and effect of that. I mean, you guys made $350,000. You live in freaking Southern California, one of the most expensive areas in the world, and you banked $800,000 instead of spending it all.

I mean, you guys are incredible. That, that's skill. set set you up to be, I mean, you're going to have $10 or $20 million in a decade. It's crazy how much money you're going to have. I would just say very simply, trust your gut. It's so obvious to us where you and your wife stand, you more than her, sure, but you will regret this if you take a mortgage out. You could feel it all over you. And you just don't want to feel that. You'll be fine. I think your $3.50 will turn into $450 in income faster by not having a mortgage than if you took one out. It's going to affect your income and people don't think about that.

I think it affects his every, you nailed it. I think it'll affect his overall mental health. That's what I mean. He's just not going to do well with that, which is great. Yeah. I mean, I have no idea. We haven't been able to get any good research and we've not done the research to tie all the way back for the rest of you folks, not for him, but for all of us. the tie between actual physical illness and debt levels. Yeah, I would love to see that. Because, I mean, the, so, I mean, what if you could actually figure out that a certain number of heart attacks out of 1,000 heart attacks are caused by financial stress?

Then we could say that debt actually has a cost, a medical cost, because you have to pay for the hospital when you have a heart attack, right? and you've shortened your lifespan. Why? Because you're carrying so much debt and there's hypertension. I mean, was hypertension number two right now? It's up there. It's up there.

Heart attacks, right? So we don't have any actual data to back that up. But what if you went through all the heart attacks and you pulled out the debt levels versus those of us that not had a heart attack and had no debt and see what the actual correlations are? It's got to be there, y'all. Common sense tells you it's there. And then so then you factor in, okay, I'm making.

I got a mortgage of 4% and I invested it at 4.5% I'm making a spread. No, not with a heart attack adjustment. You're not. I would change the math, wouldn't it can't? Yeah, it really would. It would be different. But nobody talks about that kind of stuff. Oh, wait a minute.

The percentage, number one calls a divorce in North America today. Money fights, money problems. You know who has money fights and money problems? Broke people. More than rich people. rich people don't fight about money nearly as much just poor people do

broke people I mean Sharon and I about killed each other when we went broke I mean she's from the hills of East Tennessee frying pan throwing there's an Olympic event like even the German judge gave her a 9.9 I mean come on it's like God

so yeah I mean you it's no fun no fun so I mean what if the cost of a lost marriage due to financial stress was factored into your little formula where you thought you were making money with borrowed money Oh, it would kind of dissipate that, wouldn't it? Oh, yeah, put the heart attack and the divorce factor on there.

It kind of does away with the whole idea that borrowing money is really smart. Our scripture of the day, Ecclesiastes 3, 1, and 2, there is a time for everything and a season for every activity under the heavens, a time to be born and a time to die, a time to plant and a time to uproot. Rosa Parks said, today's mighty oak is just yesterday's nut that held its ground. That's good. That's fun. All right. Devin is in Ohio.

Hi, Devin. How are you? Good, good. How are you guys? Better than we deserve, sir. How can we help? So, just really have a couple questions here. I'll just kind of give you a rundown of what I got as far as debt-wise and everything else here. So my total debt's about $182,000. $138,000 is in my mortgage from my house. I have 43 acres, this nice piece of property.

The other debt is my service truck that I use for work. It's $43,000. So with that being said, I have some other equipment as well. I got like dozers, excavators, pickup trucks. Those are all paid for in cash. That's going to equivalent to about $95,000. If I sold it all up, that's what I would have in cash. Also have a rental house that's 100% paid for.

and I have about $30,000 in stabbings. Okay, and what's the rental house worth? Probably lower 200s, just recently. What's your house and 43 worth? Lower 400s. Okay, good for you. Well done, sir. What kind of service work do you do in the truck?

Field mechanic. I traveled for the last four, four and a half years for a stabilization company, and final job closer home, but basically they're at least in my truck off of me now, so kind of pay upgrade, if you will. Okay. And so you're turning a wrench on what? Just different types of equipment, excavators, dozers, you name it, I fix it. Okay, heavy equipment.

Okay, cool. Good for you. And thus, you've run into some bargains and bought some, and you've got 43 acres to play on it with. Always looking for a deal. What's your income? anywhere from 130 to 145,000 a year. All right.

And your question is what, sir? So basically I have this debt. I would like to get my truck service truck paid off. Good. It's technically in my name, but I'd like to get it switched over to buy a business name. That way, that is in my business. Yeah, but you're not going to get the loan. You can get the truck turned over, but not the loan.

Right, correct. Yeah. All right. You got to pay it off. I agree. Okay. What else? My next thing is when I tell this equipment and my pickup trucks and stuff that I've paid for cash for over the last five years, should I take that money and pay the rest of my house off, or should I invest that money into some more real estate? Yeah. Good question. Okay. Well, if I'm in your shoes, I'm going to sell the $90,000 worth. of equipment and pay off the truck and pay towards the house. And that gets me down to less than 100 out on your home. Agreed?

Yeah. Okay. And then I would look at it and say, all right, how old are you? 24. I'll be 25 Friday. Way to go, dude. That's super impressive. I thought you were going to tell me 34 with these numbers.

You've done really well. Well done, young man. Well done. All right. That's it. That's impressive. that that calms my answer a little bit okay yeah uh because you got lots of time okay and so i don't want to stay in debt and wallow around in it because you're young i don't mean that

but i would sell the equipment because you're going to run into other equipment you're always going to be able to buy a piece of equipment for five grand turn it for ten yeah you're going to run into that and you know the equipment because you turn a wrench on it so you know what it is and you're going to, but you're going to run into a bargain here or there. And so you're always going to do a little what we call horse trading, right? Yep. No horses involved, but, you know what I'm talking about. So, yeah, so anyway, the, and that's going to always be a part of your income because of the way you work.

So, yeah, I would sell the equipment, pay off your truck, pay down the mortgage, and then I would just begin to say, all right, out of my $130,000 with no truck payment, how could, you can I begin to attack that 100,000 and when could I be done with it? I mean, you could be done with it in like three years if you watch what you're doing, right? Yeah. And you'd be 100% debt free with a paid for 400,000 dollar house, a paid for rental house of 200. That's 600. And then you start, you know, you start your long-term investing in your Roth IRAs and some good growth stock mutual fund. You sit down with a good smart vestor pro. And, dude, you're going to, you know, you're going to be a millionaire by the time you're probably 28 that'd be sweet yeah that's where you're

headed um if you follow just that basic idea there and then you know when you make some extra money don't blow it let's just chunk it on the house just get the house done because here's the thing we're talking about this a minute ago before we picked up with you that um you're going to make different decisions on which clients you want and you're going to make more money in your business when you don't have a single debt your business is going to flourish because you're clean and there's no pressure. You know what I'm talking about when you know that certain customers are not worth, the juice ain't worth the squeeze.

Right. You know, some of them are such butts. They're not worth working with for any amount of money. Yeah, because the way I have it set up right now is I'm technically in the union, so the company that I'm working for pays on my pension and health and all that. I have about $40,000 in my pension right now. That's a good start, but I want you to have independent IRAs also. Yeah, okay.

I want you to have Roth IRAs going in addition to that, not just the union pension, but, sir, you have done an incredible job. I'm very proud of where you are, and here's the other thing that I know, there are other reason I know you're going to be successful, not only that you've made the progress you've made to be where you are at 24, but also the, the way you're asking these questions you're paying attention you're being very intentional right and you're making good this you know some of the stuff you suggested before i even started there was just things i was going to suggest real quick question how old were you when you got started devon in this work uh in the heavy equipment industry working on a i went through a four-year apprenticeship program so i didn't make the money i'm making now the last two years so i would

say the last two years i started making a hundred thousand yeah but How old were you when you started the program? Were you 20? Were you 18, 19? Yeah, I was 20, yep. Yeah, I just, and the reason I did that is because, again, this is you're going to start seeing more and more of these stories in the United States. Young guys that are skipping the college route and going into this kind of a deal, and we're talking about a dude who's not only going to be a millionaire, he's probably going to be a very successful small business person. Already is.

Yeah. Well, I'm talking about it. Not a millionaire, but he's already a successful business. But I'm talking about where he's got a team. He's going to make $130, $140, $150,000, $160,000, and he's 24 years old, and he turns a wrench on heavy equipment. Yeah, that's exactly right. That's a whole lot smarter than spending $250,000 to get a degree in left-handed puppetry and then being a barista. Kids, 24 years old, and he's got a house, a rental property that he owns cash.

Yeah. I'm just pointing this out because I'm so tired of the drivel of coming from a house. all the complainers about how no one can win today. Oh, yeah, capitalism is dead. Well, don't tell Devin, okay? This is a poster child. Don't tell Devin. Don't tell Devin you can't get ahead in America.

Don't tell Devin all the opportunities used up. Don't tell him that the deck is stacked, that there are systemic problems with the economy. Don't you understand? And by the way, he paid his dues. I hope everybody heard that part, too. He wasn't making this kind of money until, so it takes time. Yeah. Somebody all need to look up what he's got on his hand.

It's called a callous. You all need to look that up. It would be good for you. Yeah. So, wow, that's impressive. It's a great story. It's not glamorous work either. I don't get it.

I mean, our buddy Mike Roe right now would be doing the- Micro would be doing the Trump dance right this second. But that's it. Yeah. This is Mike's guy. That's right. And I agree with him. I agree with him.

It's not for everybody. No. But this idea that, you know, you need to become a teacher because your grandmother said to. No, maybe not. Maybe that's a bad idea. Maybe you need to become a teacher because we need great teachers, and you're going to go into the classroom and actually teach after you get through your degree in teaching.

There's a reason to become a teacher. Oh, let's think about that for a minute. That puts us our of The Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace. Christ Jesus. Thank you.