The Ramsey Show - Stop Sabotaging Your Future

Episode Date: April 19, 2024

💵 Sign-up for EveryDollar today - The simplest way to budget for your life! George Kamel & Dr. John Delony answer your questions and discuss: Why leasing a car does not provide you with the tax benefits you think "I keep self sabotaging my budget because my adult children keep asking me for money" Contributing to retirement when self employed "Should I use a grant and a HELOC on my parents house so I can buy a house next year?" How to start your marriage off on the right foot financially Providing hope to a couple with $140k of gambling debt A caller that wanted to know if he should leverage his inheritance for $1 million of debt to try and purchase more real estate "Should we file bankruptcy because our company is being sued?" Support Our Sponsors: Zander Insurance Churchill Mortgage BetterHelp Next Steps 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 🏦 Take Your 3-Minute Money Assessment - Get a personalized money plan! 🍎 Enter the Teacher Appreciation Giveaway 🏠 Find a Ramsey Trusted Real Estate Agent 🚢 The Live Like No One Else Cruise is back!  💼 Find The Work You're Wired To Do Listen to more from Ramsey Network 🎙️ The Ramsey Show   🧠 The Dr. John Delony Show 🍸 Smart Money Happy Hour 💡 The Rachel Cruze Show 💸 The Ramsey Show Highlights 💰 George Kamel 💼 The Ken Coleman Show 📈 EntreLeadership Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Девочка-пай Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm George Campbell, joined by Dr. John Maloney. That's D-R-DOT, if you're wondering. Two PhDs, best-selling author, talking about relationships and emotional health, host of the Dr. John Deloney Show. He's joining me this hour to help you guys take the right next step for your life and your money. And my most important title, George Campbell's Best Friend.

I like that title. That's how you got hired on the resume. It feels right in my heart. Doctor was further down, George Campbell's best friend was first. I got passed through three interview levels, which means here at Ramsey, I only had 17 more interview levels to get through, which is awesome. It is intense.

It is rigorous, but it's how we get high quality people like John through the doors. We are here for you. The number to call is 888-825-5225. Don't be shy. We will be happy to give you our best advice and it's our opinion. And we are experts on that at the very least, at the very least. Ted is kicking us off in Des Moines,

or as some of my friends call it, Des Moines. What is going on, Ted? Looking for some advice on a potential car move I got to make. I've got an aged car at about 2010, and I need to either purchase a vehicle or lease one through my business, which is what both my tax professional and my lawyer were like, hey, that would be a great tax advantage. It's a good idea for you. What should I do? Well, I mean, it comes down to, do you want to listen to your accountant and lawyer or just two guys hosting a financial call-in show well i know how dave feels about leases i mean that's kind of uh that's kind of a given at this point but i just don't want to do stupid with some zeros on the end of it and just look back at this and go oh

yeah i should have leased the car uh or oh yeah i should have just bought it outright do you have a dollar amount on the tax savings no i don't that's one of those phrases that folks throw around like you shouldn't pay your house off because you can write the house off and people don't lay that up against the uh monthly mortgage payment and the tax and and yada yada they pay the interest payments they make this is one of those moments that i would wonder and i'm making a purely math argument here, and we'll talk about the psychology in a second. I wonder what the actual tax savings would be

versus the depreciation of the leased car. Because that's what you're paying when you lease a car. You're prepaying the depreciation plus other fees. You're giving a gift to the car dealership because you are paying the depreciation of the vehicle they have so they can turn around and sell it as a inspected, like, super-used car that some Yahoo just paid our depreciation for us. It's an apartment on wheels, right? Well, my further question is, why is your lawyer telling you to lease a car?

Where does that come into play? Yeah, my lawyer keeps me out of jail. That comes into play i understand my lawyer keeps me out of jail that comes into play she's she uh it's my business lawyer and we have a relationship and that was kind of a in passing thing okay you're like hey what do you think about this yeah so it wasn't like this is your legal advice it just happens to be sure people on my team and i was like maybe i'm missing something what's your business i'm a photographer okay well how much the greatest call I've ever had what is the gross revs and profits in a year right around 400,000

is your gross revenue yeah and what do you take home what's on your tax return about a quarter of that okay so you're bringing in let's say a quarter really you. Okay. So you're bringing in, let's say... A quarter?

Really? You have 300, like you have 75% expense on a photography business? You have a big team? No, that's just what I pay myself. Okay. So there's more profit. Are you reinvesting that? What are you doing with all the extra profit?

At the moment, I've made a bunch of physical moves in the business, changed locations. I mean, there's just a lot of moving pieces at the moment. Do you have any other debt? I'm just looking at just the house. Okay. Are you married or single? Married. Okay. What does your spouse think about this? She made that grimace face when I brought up the lease conversations.

I wanted her input, of course. I think she's willing to do whatever is most advantageous for us. But at a glance, she was like, well, let's get the estimate on the car first, see if it's worth putting some money into to make it, you know, kick the can down the road so we can buy a car later. What's the necessity of having this new car? Something safe for her and my son to get around in. Okay, so this isn't really for your business anyways.

It's not, but the vehicle that I currently use on a daily, she would take over, and then we could lease it to the business, and I would use it for business. Because you have to use the vehicle 50% of the time in order to even have any tax advantages from that lease. Oh, absolutely. So I just think you're going to make a very different decision if I just said, hey, how much cash do you have on hand to purchase a used, reliable car versus, hey, what's the sweetest, shiniest whip you can go lease at the dealership? Those are two very different conversations. And that's really the heart of this is you're going to make a much more, just put it bluntly, a stupid decision if you lease that car versus buying one with cash that you actually have.

Okay. Usually people say I want to lease a car for business. They want to drive something super flashy that's going to attract clients or buy like a 9,000-pound thing they can depreciate and write off on the taxes and get a G-Wagon. And it's generally stupid decisions pumped up by instagram gurus so we are not yeah we are definitely not no i'm not looking for that you're a guy who wants a reliable car for his family and we've we've both been there and every time regardless of our business and tax advantages we just go what is the car we can afford in cash and you made four hundred thousand dollars last year you've got 40 grand to buy a car right i agree yeah you have the cash doing that doing that today if i needed to is that i'm not worried about that if we needed to do that today so here's what i'm

going to tell you as a guy who's not nearly as sophisticated as George is when it comes to the math and all this. If I own a small business, which is what you have, you're very successful at what you do. I mean, you're in the 1% of the 1% of photographers. Everybody wants to get into it and very few people make it. And you are out of this world successful. I would still be haunted by how many outstanding liabilities I have as the only guy with the line in the water. And I don't care what the tax savings would be. I would pay it as a sole tax. That is my car and my business can go in the toilet the economy can tank and my business can go from 400 grand to 35 grand in one year as a photographer and nobody can come take that car from me whereas

i just signed a three-year lease agreement and those payments are coming out automatic uh withdrawal no matter what how much money i'm bringing in and the the tax savings simply is not worth the sleep tax it would cost me i don't disagree with you maybe my question should be do i need a new tax person lawyer no i i think your tax person's giving you tax advice and the tax the tax accountant is going to say here's all the things you could take advantage that's right and because you probably sat down as a small business owner and said all right help me and they're trying to cut your tax bill here's a way to cut your tax bill here Here's a way. And I think you look at your tax account and say, I don't borrow money ever, period. And if they bring it up, cool. And maybe

then if they're trying to get you to do something outside of your wheelhouse or outside of your values, then yeah. But no, I don't blame, I mean, George, I don't blame the tax. I don't think they're a bad person. They're doing their job. And if you want to get a second opinion, reach out to a tax pro that's Ramsey trusted. Go to ramseysolutions.com slash tax and say, hey, what do you think about this? And I'm curious if you'd get a different opinion. But I don't think this is going to bless your life in the way you think it does. There's other ways to get deductions, better ways to skin this cat. That's my final take, John.

This is The Ramsey Show. I've been doing this show for over 30 years, and some of the saddest calls I have taken are from situations that are completely preventable. Yeah, and what's so hard is I feel like one of those, especially the ones that I'm like, oh, it's terrible, are people that call in and their spouse has passed away suddenly, and they don't have life insurance. When you have to think through how am I going to pay my bills in the middle of all that grief, it's terrible. So life insurance is the one thing, especially as a mom with three little kids that I'm so big on for people to get because it's inexpensive. Zander is the place that Winston and I actually get all of our life insurance. And it doesn't cost much because Zander shops among a gazillion different companies.

It doesn't cost much. You just have to admit that someday you're not going to be here. You got to say it out loud and you got to say, I'm going to say I love you to my family by taking care of them and taking the time to put this stuff in place. The cost of stinking pizza. To get a free quote, call 800-356-4282. That's 800-356-4282 or go to zander.com. Welcome back to the Ramsey Show. I'm George Campbell joined by Dr. John Deloney. If you guys missed it, we have a big announcement this week. The Live Like No One Else cruise is back. Don't call it a comeback, but it kind of is because five years later, we're bringing it back.

Join Dave and all of the Ramsey personalities, John and I included, for seven days at sea, March 22nd through the 29th of 2025. So we're less than a year out. On top of all the Ramsey personalities, we have some amazing musicians,

magicians, comedians, you name it. Songwriters, they're all going to be with us. Stephen Curtis Chapman, Manin Chauhan, Dina Carter, Stephen Bargatze, Nate Bar it. Songwriters, they're all going to be with us. Stephen Curtis Chapman, Maneen Chauhan, Dina Carter, Stephen Bargatze,

Nate Bargatze's dad, amazing and hilarious magician will be there. So here's the thing. This is not for everyone. This is for those of you who have been working the Ramsey plan. You've gotten out of debt. You've got the emergency fund. You're in baby step four and beyond. That's who this is for.

This is the ultimate debt-free celebration. We're going to be taking over the entire cruise ship. Imagine that, John. All Ramsey fans. It's going to be electric. That's a lot of Ramsey in one place. It's a lot of Ramsey. It's going to be a hot time.

Literally, it's going to be hot, I think. Turks and Caicos, St. Thomas, San Juan, the Bahamas. And it's going to sell out because the last one sold out in just a couple of weeks. So VIP upgrades already sold out. You can join a wait list to see if a spot opens up, but you can book your cabin now at ramsaysolutions.com slash cruise. And I've been getting DMs about this. People want to know, are kids invited? And so I found out from our live events team, they are in fact invited. No kidding? Yeah. I did not know that. So it's kid-friendly. If you want to bring your teenager, your toddler, whatever, they're welcome aboard, too.

So tell your friends. I think I'm going to bring my kids. Make some friends if you have to. Join us for the Ramsey Cruise. Ramseysolutions.com slash cruise. All right. Seb is on the line in Atlanta, Georgia. Seb, what is going on?

Hey. is on the line in Atlanta, Georgia. Seb, what is going on? Hey, so I am trying to find out if right now is the right time for me to finish my bachelor's degree in engineering. I got my two-year degree and got into the workforce to work as an engineering technician. I'm married, have a one-and-a-half-year-old. We have a very, very low-cost mortgage in rural Georgia, and my employer is encouraging me to use the $5,000 tuition reimbursement plan

to get back to finishing what's left of my bachelor's degree for that promotion and moving up in the company. What that would look like is probably taking out some federal aid and having that reimbursed every year at the federal tax limit that my company offers. I just don't know if right now is a good time because I am paying back some current student loans, but I would like to finish my degree sooner rather than later. I think everything you said for me is an all steam ahead, except I don't think you have to take out the federal loans. Okay.

Either A, as your family, I'll figure it out if it's reimbursable within one paycheck cycle, if that's how they roll. And I know some companies do. The other way around it is I think you sit down and ask your boss, say, hey, you know how much I make. You know I've got a one-year-old. Can we prepay this if I hand you the bill, right? Versus getting all tangled up in the finance mess because here's what's going to happen. You're going to take out a loan.

They're going to send you $7,500. You're going to put $5,000 down, and then they're going to say, it'd be cool if you had this program, and you'll be like, oh, I'll just buy that program. And then your transmission will fall out of your car and your boss will reimburse you five thousand bucks and you use thirty five hundred dollars of that on your transmission and i know this because that exact thing happened to me sounded personal it was very personal so i would

not trust myself with federal aid money just floating around because it's real easy for all that to just to go away but an engineering degree you have a boss you have a boss looking at you saying this is going to help you move up in this company it's going to help you and i'm willing to put some skin in the game and contribute to this um i would pause george tell me if i'm wrong but i would pause paying back my student loans and knock this bachelor's degree out once and for all and let that be a rocket ship for you professionally. What does your total debt loan look like? Currently, I have $23,000 in student loans over the course of the three years and some change. I was working. I ended up working full time.

I got married while I was in college and got into the workforce because experience in engineering matters. And I wanted to have some experience while I was in school. So now I'm trying to just round it out and get to that accredited engineering position. So what do you make now? Right now I make about $68,000 to $69,000 a year, right in that range. Cool. And you have no other debt other than the student loans? We have a mortgage of about $1,200 a month, all inclusive. And your wife is at home with the one and a half year old? That's right. Mom's staying at home and I'm

working a second job to pay off the student loans. So would you continue working full time while doing this program nights and weekends? Yes, I would actually be a fully remote student to finish out the work that's left because all of that is actually available for me as a remote student. So there'll be no dip in income? No dip in income apart from figuring out how to pay in advance the coursework required. Yeah. I mean, I would figure that out ASAP. How much do you lack? I'm about 70% there, 75% there. So how much total is this going to cost you? Probably around $15,000, given the estimation that the university provided me.

So $15,000, and they're going to reimburse $5,000 total? My company will cover 100% of tuition year-on-year up to the federal tax limit, which is $5,500 a year, approximately. Okay. So what if you covered the difference with cash and you were able to still do this? How quickly could you save up the difference to get through this first year and then save up the difference for the next year and be done? I could probably keep rolling it in at the rate that they will reimburse it. Okay. So how quickly would this all happen? Without dipping into the red.

This would probably happen within a year, year and a half. And you'd be done? Completely done. And this would increase your income exponentially? What's on the other side of this for your career? I would move to holding a position as a project engineer, which is a project lead position, a more senior role, and a range of about $20,000 annually increase. So you could be making 90 if you finish this thing? That's correct. Yeah, this is as no-brainer as they come. But here's the key. You have to do

all this aggressively, and you're not touching debt. That's the agreement. Because the faster you do this, the faster you save up cash, the faster you get through the program, the faster you make more money, the faster you get out of the rest of your debt, and you're home free. But we don't want to look up and have 15 more grand on top of the 23. And there's going to be no lifestyle creep. You're going to keep living the same way even when you get that raise. Right. I mean, we're staying in the green right now, and I'm working a second job to pay off those student loans so it'd be nice to uh you know go back into school and everything goes into

forbearance once you become a student again um as it as it stands um yeah i think this is a good plan if you do it without debt and you move as quickly as possible you don't want to drag this out because we want to see all of that debt gone on top of not accumulating any. And John, this is a big thing people grapple with. Should I go back to school? How do I do it? How do I cash flow it? What would you say to people coming from that world?

There's a couple of things. One is if you are 70% done, finish your degree. I've never, I haven't met somebody yet. And of course I worked in higher ed for 20 years. I've obviously got a bias here. I've never met somebody who went back and finished and said, I shouldn't met somebody yet. And of course, I worked in higher ed for 20 years. I've obviously got a bias here. I've never met somebody who went back and finished and said, I shouldn't have done that. I've never met that person. I've met people who said, I shouldn't have got this graduate degree.

I shouldn't have gone to college, period. I've never met somebody who's 70% done that's like, I shouldn't have done that. The second thing I always want people to do is go ask your employer if they'll help out. And this guy's employer will cover all of it. And that makes it a no brainer for me. And when people say, well, I can't do this, I can't do this outside of med school and law school, maybe one or two other programs. I worked a full-time job. I had a part-time job. I was a full-time associate dean. I was a part-time professor, an adjunct professor, and the father, not one of two small kids a husband and a full-time phd student you can figure it out for a few years and is it awful yes does it pay off on the back

end if you are getting the right degrees oh absolutely it does and so it's it's just like the gazelle intensity there's a few years of misery for an entirely new family legacy on the back end um it's when you start taking out federal loans just because i'm just gonna go do this right now because it'll be easier and then we'll we'll settle up on the back end you get laid off your something else happens you need the cash you don't finish you don't finish you're still stuck with they don't want to forgive the debt just because you didn't finish the degree that. That's right. That's where people find themselves. Your company has to lay people off until they cut this program out. No debt.

Just knock it out, knock it out, knock it out. But yes, I'm always a fan of going back and finishing that degree. Even if you move slower, it's still a better path long term. It gives more peace to your family. Especially if you've got a stay-at-home spouse. So we don't want to see a dip in income and we don't want to see any more debt accumulated. That's the key.

Thanks for the call, Seb. This is The Ramsey Show. Buying your first home is a big deal and sets the stage for your financial success. So work with a mortgage advisor you trust, not just some random website. Churchill Mortgage is Ramsey trusted because they help you avoid hidden traps and expertly guide you through every step. Learn more at churchillmortgage.com. This is a paid advertisement. NMLS ID 1591. NMLS consumeraccess.org. Equal housing lender. 1749 Mallory Lane, Suite 100. Brentwood, Tennessee 37027. Welcome back to the Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. Open

phones at 888-825-5225. You call in and we'll help you take the right next step for your life and your money. And hey, while you're listening to the show, it's a free show, may I remind you. There's one thing that you could do for us that's also free. It would only take you a moment, and that is to share the show, to consider subscribing, hitting the follow button, leaving a kind review, telling people about it. You are the greatest marketing plan we have, and it helps our budget because we don't spend a whole lot on that. You don't see big billboards out there. You guys are the best marketing we have just by telling your friends, word of mouth. It is powerful, and it's working, and we thank you guys. We want to reach more people through this platform. All right, let's get to the phones. Maureen is in Palm Springs, California. Up next,

Maureen, what's happening? Hi, how are you? We're doing great. How can we help? So I'm familiar with the baby staff. I try to be a good steward of them, but I seem to continuously sabotage myself. I just need to know how can I be more diligent in, I guess, following them. How do you sabotage yourself? I make that budget. I am on it every day, checking, making sure I'm tracking my expenses. And then one of the family members that I have have a need or or I personally will be like well I guess I can go out of town and go and do that and so then I have to recalculate everything and then I push my so you're getting stuck on on the meticulous numbers and one thing throws a wrench in the plans and you

go oh my gosh I failed again oh no I think it's deeper than that I think the budget's like uh it's like a toy. It's just something for you to fiddle with. It's almost like a fidget spinner. But your real identity is, if any family member calls for any reason, I'm the hero and I'll save that. Or I'm only going to live once, and so I'm just going to go do whatever I want to do. I'm going to take care of right now me and forget about next year, Maureen.

I guess, well, if the family calls and they need something, I'm going to cut from my budget line that I have assigned for me. I mean, mind you, it's like minimal for my personal expenses for the month. Why are you putting your oxygen mask on them before you? You're not in a place to be giving right now. When you say family, are these your children? Is this a spouse?

Who's calling you up going, hey, we need to spend this? Yeah, adult children. How old are we talking? 30. Oh, boy. Maureen. I can count on zero fingers how many times I have called my parents for money since I was, I don't know, 20 years old. So this seems to be the systemic problem where they go, well, mom is going to be sweet and send us some money because we're struggling.

What do they need at 30 that something they can't provide for themselves? Well, I'm providing quite a bit for them already. Why? Wait, why? Maureen, what do you feel guilty about? Yeah, it just seems difficult for them to make that step into independence. It does because their mom won't let them go. I wouldn't leave either. This sounds like a brilliant plan. I get to live at home for free.

Mom pays for all my expenses. And then when I run out of money, I call mom, and she cuts herself off at the knees to keep my lifestyle budget going. Okay. Well, I have made some stuff. Listen, she's like, all right, I'm done with you two. Yeah, you need some problems. Yeah, you need some problems is what I've heard and listened to. And so I implemented like, okay, you've got to pay me rent. And so apartment one, you give me $300.

And apartment two, you give me $750 is what I tell them. And it doesn't come with any concierge services. So I'm trying to implement those steps. How old are you, Maureen? Oh, I'm 48. What are your financial goals? To be debt-free. So you still have debt? And to pay off the mortgage as soon as possible. Okay. So you have consumer debt? I have $15,000. I have $15,000 in debt, yes, and I have $187,000 on my mortgage. Okay, hold on.

I just got... Sorry, George. No concierge service? As though you'll show them. Yeah. What are you talking about? That I'm going to go and check the mail for them. I'm not going to go run and grab food for them on my way home.

How would that even be in your mind that you had to say that out loud? They're 30. Because that's what they asked for. I think we need a hard boundary conversation to say, listen, I love you guys, and I have loved you too hard. And I have stunted your growth, and that part is on me. But there's a part

that's your responsibility, and that is going to live your freaking life. So you have six months to get a plan and get out of this house and find an apartment. And if you need seven roommates and a third job, I'm just saying we need a game plan to get out. Maureen, have you ever gone to a gym and worked out? Yes, I hate it. Okay. Here's what you're doing for your kids. They're going to the gym and they're looking at you saying, mom, I've got to get stronger. I've got to, I can't live my life like this. I got to get stronger. And you said, okay, I'll go with you. And you walk into the gym and when they lay down on the bench to lift some weights, you run over there and take all the weight off the bar. And they push the bar up

with no weight on it. And they're now 30. And they're wondering why they can't navigate the world. They're not strong enough. And it's because you keep using them to make yourself feel like you're being a good mom. And that's not their job. Why do you feel this need to keep? There's got to be some guilt you're trying to wipe i mean i don't know what are you trying to solve or accomplish by giving 30 year olds this much support and care do they have special needs or they just don't want to work what's the deal no no no no yeah i just

they're they're working they're one he just finished um school and he took a pause for a bit and then his fiancee is finishing um going back to school and i just i told for a bit and then his fiance is finishing going back to school. And I just, I told them a few months back when I gave them their rent notice that they were going to have to start paying rent that, you know, let's revisit this in June because if it's working until June and then, you know, then we'll see where we go from there.

But if it's not working, then... How far below is $300? How far below is that a market rent oh gosh i mean that's nothing exactly for the youngest one who who will pay me whatever i want and i and this is the thing i tell them i don't need your money i just need you to do your thing but they need your money they need your money on me So my word, there's a lot of problems here. Number one is that you haven't put your own mask on first. You're going to remain broke while sacrificing for your kids that can't start their adult life.

So that's problem number one. And the other problem here is that their growth will continue to be stunted as long as they still have this sweet scenario. And so your job is not to be cruel, but to be honest on both sides and say, I haven't done a great job of doing this. You guys need to step it up. I'm going to give you three months to find a place to live, and I will help you leave gracefully. You don't need to kick them out on the street and evict them, but this is a problem that's gone on far too long. I literally thought you were calling to be like my eight-year-old needs saxophone reads for band yeah this is a 30 year old grown adult or a 21 year old yeah or someone about to be married no my youngest is married and and this is where

i say i self-sabotage myself right i have my plan my youngest is married and i said well instead of you guys you know carrying that burden of going, her finishing nursing school one semester, why don't you just stay here for a year? And then after that, then go ahead and get your place. And they are, they're looking to buy, but that's going to take them like at least another six months. They need to rent, give them, they can go sign a six month lease, tell them this and get used to paying their own bills. I want to be your mom and not your landlord. I want to be your mom and not your bank.

And I can't do both. And if they choose, well, we wanted you to be our bank, then y'all need to have that conversation. Can I ask a hard question, Maureen? What happened to Dad? Oh, that's a whole other call. But I think a lot of, Maureen? What happened to Dad? Oh, that's a whole other call. But I think a lot of this stems from the fact... Yeah, no, he's there. He's here.

He's here, but... Is he? I don't... Because it sounds like you've taken on the brunt of all of this, and maybe part of it is because of what's happening with Dad, and you feel like you need to be the savior and hold this family together. Well, no, he's here we're married i just financially don't do any anything with him i do nothing financially with him that seems to be part of this problem and i wonder if you're trying to buy a continued relationship with your kids. And you want to ask about why you can't keep a budget?

Because you got a lot of stuff going on. The budget's not the problem, Lorraine. We have to have a lot of hard conversations really soon. I'm so sorry. This is The Ramsey Show. This show is sponsored by BetterHelp. This is the season for Halloween. It's October.

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masks and costumes all the time, if you find yourself hiding from your true self, I want you to consider talking with a therapist. Therapy is a place where you can be honest, where you can talk to somebody else and reflect and learn, and you can accept all the parts of yourself over time and start living an authentic life. Masks and costumes should be for Halloween parties, not for our emotions and our true selves. And if you're considering therapy, try calling my friends at BetterHelp. BetterHelp is 100% online therapy. You can talk with your therapist anywhere, so it's convenient for you and your schedule. Just fill out a short online survey and you'll be matched with a licensed therapist. Plus, you can switch therapist at any time for no additional cost.

Take off the costumes and take off the mask with BetterHelp. Visit BetterHelp.com to get 10% off your first month. That's BetterHelp.com slash DELONI. Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloni. The number to call is 888-825-5225. Carmen is up next in Cincinnati. What is happening, Carmen?

Hi. Thank you so much for taking my call. I appreciate everything you all do to help people. Thank you. So I'm looking for guidance for how best to contribute for retirement. My husband and I are self-employed small business owners, and this is new as of 2024. In 2023, we had kind of a hybrid year where he had a W-2 job. And then we had a side business that was a house renovation. And so our income from 2023 was quite a bit higher than we're used to. But now that the ship got close to the dock, we are going to try to take that ship and make our own income higher. Awesome. So you're going full-time with a small business, both of you? Yes.

What kind of business is this? It's a high-end property maintenance and renovation business. Wonderful. What do you think you'll make this year doing that between the two of you? I'm hopeful that we will net $100,000 to $120,000 for our household income. Cool. And your question today is about retirement? Yes. So I understand that match beats Roth beats traditional. And I'm curious if we should just jump straight to the Roth or if there's a different... I don't know how to match myself, I guess. Oh, sure. Yeah, that's generally for if you're working for an employer that has the match, that may be you guys one day, who knows. But for now, there's one option for anyone with

earned income, and that is a Roth IRA. And so both of you can fund a Roth IRA to the max. I believe it's $7,000 for this year. And so both of you can do that. Your other option, a lot of self-employed folks and small business owners don't realize that just because they don't have a big employer, there's still some really cool retirement options where they can put away even more money than a traditional employee. And one of the most popular ones, this one might be for you guys, is the solo 401k, sometimes called the individual 401k. So as long as just you and your spouse and you have no other employees, you should be eligible to contribute to this. Okay. And as the boss, you can contribute an additional percentage of your net income to that 401k up to $61,000 if you're under 50.

Are you guys under 50? Yes. Okay. And it's even more if you're 50 or older. So to reach the 15%, where does that number come from? Is that what we pay ourselves? That's from your gross income for the year. So whatever's on your taxes, that's what the number you want to be basing it off of. So as a self-employed couple,

is our growth income our business income this year? Yeah, any profit. I mean, if you're working with your tax pro and you go, hey, our income minus our deductions and all of that, this is really what we took home. They don't care how much you took home. It's still profit from a business perspective. And so you're going to have to pay taxes on that. Okay, so 15% of whatever the number is that we pay taxes on. So let's say it's 120 grand, like you mentioned, you guys should be putting away 18 grand. And so maybe you both fully fund a Roth IRA that's 14 and you put another four in a solo 401k. Okay. And then, so because this is also like new to us, should I just park money in like a high yield savings quarterly or till the end of the year, just so I don't step in anything? For taxes? A big number. Taxes or retirement, both. Well, high-yield savings is for your short-term goals, not for investing and for retirement. So

it's a great place to store your money for tax reasons. And so I would do quarterly estimated payments to the IRS if I were you. Make sure you stay on top of that. And so whatever money you get, put away 25%, 30% in a high-yield savings account and then file those taxes every quarter. And you might – do you have a bookkeeper right now or are you guys doing it all yourself? I am the bookkeeper. Wonderful. And you're the best one we got. All right, Carmen, I want to ask George a question on your behalf, okay?

So, George, you're talking about 18% of the net of the business at 120 if like some small business owners they kick off a small business and they're not going to take home a draw they're going to pay themselves ten thousand dollars a year for the first two years while this thing gets up and they're going to scratch and claw would they pay 15 of that 10 grand as their as their quote-unquote salary well i think it's whatever the actual profits were from the business so So you can say I paid myself $0. The government doesn't care because what they see is John brought in $200,000. Well, you got to pay taxes on that. As far as investing your 15%.

Correct, yeah. That would be based off of the gross income that you took home. Off your draw of whatever you made. So if you took $120,000 before taxes, that's what you want to be investing from okay but if you if your business made 120 total and after let's say you grossed 120 like your total expenses your total net was 200 000 it took 80 grand to run that business you you have 120 grand you're going to pay taxes on that you're're going to pay yourself. You still invest before the taxes are out. Husband is 10, wife is 10.

That's what your take home is. You're going to pay taxes. You're going to take 15% of 20 grand. Exactly. Okay. And that's the way to do it. And as the business grows, you'll invest more. And I think that Solo 401k is a great option for you.

And I would contact one of a SmartVestor Pro, and these folks can help you navigate what the best option is for you. There's a lot of different options. There's simple IRAs and SEP IRAs. But from my experience, I found that most business owners that are solo or have a spouse working with them, the Solo 401k is the best option they've found. So you can go to ramseysolutions.com and click on SmartVestor, and they can help you get that all set up and help you with the right strategy. But I hope that at least helps you take the right next step. Yeah, great. Thank you so much.

Awesome. Thank you for the call, Carmen. Way to go. That's a scary moment, stepping into small business full-time, but what an exciting time. And you guys have done it the right way, getting that boat close to the dock. It's not a leap of faith. It's just a step. All right, let's go to Terry in Houston, H-Town, John's favorite place. What's going on, Terry? Hey, guys. How are you doing?

Thank you for taking my call. Sure. How can John and I help? My question is, should I use the money that I have in savings to pay off debt to start cleaning up my credit in preparation to try and buy a new home? Okay, tell us about your situation. How much debt do you have? Oh, combined, my wife and I have about $110,000 in debt. That's consumer debt?

Correct. Okay. Well, actually, part of that is a home, part is student loan, and then $17,000 of the debt is mine. So what do you mean it's in a home? Because you're living in a home right now and you're going to sell it and buy a new one? Yeah, we're living in a home. We have a home equity loan that we have right now, and we're down to about $58,000 on the loan left. Okay. She's got $33,000 in student loan. And then, like I said,

I have, under my name, $17,000 in debt. $15,000, that is really stupid debt that's already been charged off. And I'm not sure the best way to fix this. Okay. How long ago was that? How long it's been in collections for?

I don't know. A lot of this has been a long time. Okay. You might be able to negotiate that for some pennies on the dollar at this point and see if they'll take a lump sum and call it paid in full and get that all in writing. But as far as buying a house, it sounds like you guys are not... How much do you have in savings? Do you have enough to pay all this off?

Not to pay all of it. I've got about $40,000 in savings right Do you have enough to pay all this off? Not to pay all of it. I've got about $40,000 in savings right now. Okay. That's all the cash to your name, and that would get your debt down to $70,000? Correct. Okay. Yeah, I mean, if you're following the baby steps, a $1,000 starter emergency fund is what you're aiming for, and then anything beyond that needs to go toward your debt snowball. And so if you want to leave, you know, take $ of that and leave 1,000 in there and start crushing down that debt, I think that's a great move. And start paying them smallest to largest balance. So I'm guessing your 17 is the smaller of the balances, followed by her student loans, and then the HELOC is the big one at the

end. Yes, sir. What's your household income? Right now, we bring home monthly right at about $6,200. Okay, good. So the question becomes... That's going to change before now at the end of the year. For me, it's going to increase. Okay. I just don't know when yet. You're not sure when.

Well, every single cent that you can muster up beyond your normal expenses, food, utility, shelter, transportation, throw at the debt. And knocking out $39,000 of that today is going to feel really good and free up some payments and get you out of this debt faster. But I don't think you're ready to buy a house until you're at that spot. No debt at all, emergency fund in place, three to six months, then we start saving up a down payment and your credit will probably have solved itself by then. Thanks for the call, Terry. That puts this hour of The Ramsey Show in the books. Thank you to my co-host, Dr. John Deloney, all the guys in the booth keeping the show afloat, and you, America, will be back before you know it. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build

wealth, do work that they love, and create amazing relationships. I'm Ramsey Personality, George Campbell, joined by my good friend, Dr. John Deloney. Open phones at 888-825-5225. You call us and we will do our best to help you take the right next step for your life, your relationships, your mental health, and your money. Megan is going to kick us off in Rochester, New York. What's going on? Hi. So I'm just trying to get some advice with my trying to buy a house in about February, March, 2025. I make about $68,000 a year. I am a single household, no kids, no significant other. And because of the financial economy right now, it's not an option not to buy because rising rents. So I'm preparing to buy next year to also take advantage of a $20,000 grant that can be applied towards principal or closing costs. My situation or my question rather is what to do with some extra money.

My parents are taking out a HELOC loan to pay off my private student loans. Please don't do any of the things you're doing, Megan. Is this already happened? All the things you're saying, please don't do any of these things. It's already in process. So without the student loan, I will be able to buy. But with the student loan, my minimum payment for it is $722. And I already talked to a realtor and they said, I may be to get approved for a $100,000 house, which is nothing.

He said it's not impossible, but he was like, like it would be very very hard to find a house um so all the documents are already signed and everything for the helac um and it would it would free up uh 455 out of my monthly payments i know but it just put your parents house on the block and so whenever you buy a house make sure you've got space for them to move in with you someday because their their chances of retiring just went way down. Oh, man. They already are retired? I want to go back to the thing you said earlier.

Okay. My initial gut reaction to you had something about rents are going up so it's just there's it's there's only one path forward anytime somebody says there's only one path forward there's only two options i always want to just pause and completely clear the deck talk to me about that because i so i would rather like just listening to your story i would rather if you were my sister you were my kid you were one of my best friends i would tell you dude don't do any of the things you're doing. Move in with your parents. If that's the option, move in with them for a while. Talk to me about how there is just simply zero, no chance, no how can you rent a house for a season or an apartment?

I am renting right now. I'm renting a one bedroom apartment for $1,000, but rents are continuing to rise. My parents live in New Jersey, so we live in totally different states, and the job market for my field is not there. What's wrong with paying $1,000 for rent, making $68,000? That's not the problem here. No, if it would stay $1,000, that would be great. Let's say it goes to $1,100, still not a deal breaker.

$1,500 1500 it's still not the thing that's holding you back no so the my issue is if rent keeps rising it's going to lower the amount that i can save for a house and interest rates going up it's going to get to the point where i'm i'm too underwater to even get a house. Do you have insider knowledge that interest rates are going to continue to go up? I don't, but that's the way they've been going. She knows something. You're on the internet so, so much. Here's the deal.

We may not be able to help you because it sounds like you got this all figured out. I would tell you, just as a guy that's owned a bunch of houses and a guy that had to go see a doctor because I was so catastrophic in my future predictions. And by the way, they've all 100% of them I've been wrong on all of them. I want you to solve for peace, not for imaginary catastrophes that have or haven't happened yet. Are rents going to go up? Yep. That's the way rents work, especially in a culture that refuses to build new homes, that refuses to build new houses to let people build. So yes, rent is going to go up. Is it going to go up to the tune of putting your parents house on the block no it's not even if

it went up a hundred percent and your and your rent was two thousand dollars you can still afford that somewhat comfortably on your salary annoying but somewhat comfortably and i don't believe that interest rates are going to go up indefinitelyfinitely from now and forever until the end of time. Or saying is this desperation is going to lead you to make a rash and poor decision when you're not ready for it. So how much debt do you have? I have about $115,000, including that $48,000 from the private loan that's getting paid off. So even with your parents taking on this HELOC, you're still going to be left personally owing $80,000? Yes.

My federal student loan is in deferment until 2026. I have a $25,000 car loan left and a $5,000 personal loan. What career field are you in? Social work, care management. Okay. I used to teach graduate counseling courses, okay, mental health professionals. And I've had to have this terrible, uncomfortable, awful conversation. And that is with particular students in particular situations,

I believe you when you tell me you were put on this earth to sit with hurting people and to figure out how to support and love hurting people in our communities, the least of these, and how to navigate the messy systems that they have to navigate. And I'll also tell you, I told my students it is unethical

for you to stand up in front of people and help them and at the same time you be so terrified that you can't breathe because front of people and help them. And at the same time, you'd be so terrified that you can't breathe because of how much money you make. And so at some point, you may have to say, okay, either I got to take a second job for two or three years until I can right this ship, or I'm going to have to go get a different kind of job and put my calling on hold for a season because I simply can't afford to live in the place where I want to live and do the job that I want to do. Because it sounds like- I have a second job.

Okay. Yeah. That's what I was afraid you were going to say. You're already ahead of me. Here's my fear. Your biggest war is against math. And it's not going to change. And you owe $150,000. And your parents are going backwards to help. And you're going to go backwards to help. And you're going backwards to try to get. See what I'm saying? It's just this. You're in a car and the wheels are spinning.

And I'm only telling you this because I love you. And I just don't want to see you go so deep. I want the world to be able to experience your help as a trained social worker. Because we need you. But you can't breathe right now, right? I'm living comfortably where I am. Like I said, I just, because I have,

my total expenses monthly is about $3,400 and I bring in a little over $5,000. Good. That all needs to go to the debt. What's your car payment, Megan? That has to go to debt. $575. What's your car payment, Megan? That's good debt. $575. What's your personal loan payment?

$205. Okay. I just added that up. We're talking $1,400 in debt payments. $1,000 rent is not the problem. You could free up $1,400 if you got aggressive at this debt. Hang on the line. I'm going to send you a copy of my book, Breaking Free from Broke.

I want you to read it all the way through and send me a DM and let me know if that helps and if we can help in any other way. So hang on the line. We'll send you a copy of that book. Wishing you the best. Welcome back to The Ramsey Show. I'm George Camel, joined by Dr. John Deloney. Open phones at 888-825-5225. It's time for a question of the day. And today's question comes from a student, Travis B. from Bryan High School. All right. The question is, how do I approach my parents to talk about money when I'm learning about the baby steps and they never have been very good with their own money?

Great question. Great question. Does Dave call this one powdered butt syndrome? steps and they never have been very good with their own money great question great question does dave call this one powdered butt syndrome like parents don't want to hear financial advice from the kid that was changing diapers yeah two things they usually don't want to hear about sex and they don't hear about money like i don't want to talk to you about that i changed your diapers right um i think this is going to depend on your household. So for instance, in my house, I do not want to raise a son and a daughter. I've got two kids. I don't want them to raise,

I don't want to raise two kids that are compliant, meaning they never ask me to explain why I do what I do. Or if they see me having trouble with something, my son the other day said, Dad, why don't you just pick all that stuff up and take it out of the car when you get here instead of getting all mad when your coffee won't go in the coffee holder

and it's full of all these cans. You raised a prodigy. Well, I looked at him. I was like, how about you just shut your, right? But I want my kids to question things because I don't want them to go out into the world and just accept whatever culture says right and so in my house i would love for my son to be like hey i don't

understand why you have so much attention you're always complaining about bills and you'll have these credit card things i'm learning about it can you teach me about that like and that's that's how we teach our kids obviously be respectful i've learned which i'm doing is just naive that's not how most people do it and so most people parents don't want to hear anything from their high school kids especially points of pain in the household and so this is a good moment when i think all high schoolers college students begin to imagine their world as they get older. And sometimes we want to take things from our childhood. I want to be a dad, just like my dad.

Or sometimes we say, I'm never going to do this. I don't ever want my kids to experience what this is. And so I think this is one of those moments that maybe you can't. Maybe you begin to get your summer job or your everyday job and your parents are like well you got money you say well i'm saving this much money i don't use credit cards i don't use debt i'm following the baby steps and maybe it's an invitation for them to say well tell me about that versus i'm gonna lecture my mom and dad that ain't happening right exactly and part of this you know um we're taking this question it's financial literacy month And one of the ways we're celebrating that is taking questions from actual students at high schools that are teaching our foundations and personal finance curriculum. So the interesting

part is these students are going to school learning how the credit score is a scam and how credit cards keep people broke. And then they're going home and they're going, hey, mom, here's what I learned today. And the parents are like, what? They taught you what? You need that, son. The credit score is a good thing. So naturally, conversations will be struck up from this. And so if I was the student, I would come home and they go, hey, son, how was school today? I go, it was actually really cool. We took this finance class and I'm learning about credit scores. And did you know this? If you come at it from a place of just like curiosity, empathy, excitement, hopefully if you have healthy parents, they'll go, tell me more about that. Really?

Or they'll call the school district and be like, let's ban that book. Ban the book. Yeah, we need to teach our kids that there's good debt and they should all be taking it out. Fire that teacher for teaching my kids something I don't agree with. This might be a 10-year journey of trying to convince your parents that there's a better way to handle money, and it might never work. And you have to grapple with that. But I think the best way to talk about it is from your own perspective, your own experiences, and asking good questions. And you can disagree politely.

Don't disrespect your family here, but you also don't pay bills. So, again, they're not going to take your opinion with a lot of weight when they're still covering all of your expenses and be all high school kids be slow to judge your parents because you don't know you don't know the full picture of what they're going through and they're not having every conversation with you and you think you know everything but you don't um and i also think very few people don't like to teach something that they know and even if they're not great at it right so maybe the approach as a high school kid is hey we're learning we're taking this finance class we're learning all about money will you teach me about how y'all budget like can i can i sit and watch y'all budget because i don't know how to do this i'm learning this at school and you might

find yeah we don't do that in our house and then you might ask would y'all be willing to do that i'm learning about at school i just want to try it. Can you help me with mine? Right. Can you teach me with mine? And so everybody likes to help somebody when they come and sit before them and say, will you teach me something? Yeah. That feels good.

And planting some seeds and going, hey, I'm going to go buy the Total Money Makeover and Breaking Free from Broke and go, hey, I'm reading this book. It'd be really fun if you guys are open to it. I'd love to read it with you guys, and we talk about it as that's i learned about again i i trust me i'm not the parent of the year but one of those conversations i started when my son was younger was i'm gonna read a book and occasionally i'll say you got to read this book and he gets the right to say dad you got to read this book and so i find myself reading these science fictiony i don't understand them but here we go and my son's sitting over there reading the comfort crisis by michael easter right

um he just he just buzzed through um uh the anxious generation book um by the author of uh the coddling of the american mind i'm the jonathan hyatt um he read it before i did right and it was on the on. And all I have to say is, if you start when your kids are young with this idea that we read books and you read a book and you read a book, then maybe when your high school kid stumbles on something that's important to them, they already have a mental map of, all right, let's read this together. And you can go with them on that. That's beautiful. Well, I hope that helps. Travis B, I hope that helps you. There's no easy way to do this, and it may not go well,

but you lead with empathy, humility, experience, and curiosity. I think it'll go better for you. All right, let's go to the phones. Haney is in Chattanooga. What's going on, Haney? Hey, so I'm getting married in August, and I've only got a car loan. That is the only debt that I have in my name, and she doesn't have any debt. But I'm wondering, is there any way that I can get out of this debt before I get married? Because I know the number one reason for divorce in marriage is finances. And I want our marriage to succeed. Obviously, I do or I wouldn't get married.

So I'm trying to figure out how I do that or if it's even possible if I just need to do the beef and rice and pay it off and just get at it. Well, I'll tell you this, based on how you just set that all up, your marriage success is not going to be based on whether you walk into this with a car loan. And so I don't want you to hold that pressure over you. Like, I'm a bad husband already. I'm a failure. I think your spirit to want to set your family up for success aggressively, that's what's going to carry you. And it's fights about money or it's misalignment about money, not the actual debt amount that you walk into a marriage with. But it sure helps when you can walk in with no debt. So what's your car loan? What's left?

So it is $35,000 right now. How much do you make a year? I make around $40,000, give or take some. I make $20 an hour, but I do make commission on certain things. So when you say $35,000, are you talking about $35,000? Yes, sir. I'm sorry, $35,000. Okay.

Sell it, homie. Bye, Felicia. The good news is you will be out of debt by the time you're married because you're selling this thing next week. Today, this weekend. Well, the thing is I'm upside down in it. I made a bad financial decision when i was uh back in 2020 my car had broken down and i bought a 2011 jeep and uh basically i bought a linen so a couple months ago that i brought it to dealership i'm like hey i can't drive this anymore it's it's

been in here more than i've driven it. And they're like, okay, we've got this brand new 2024 Toyota Corolla. Brilliant. You can do a trade with you. And the way they played it out to me, it would just be an even trade. And I didn't really pay attention. It's stupid of me. I realized that. How upside down are you? $8,000 upside down. Okay. So even if you sold it today and you have eight thousand dollars in debt plus five thousand more to go get another car right you just cut your debt by twenty two thousand dollars right so you go to your local credit union and say hey i'm looking for a loan for 13 grand that'll cover the eight grand you're upside down on and give you five to go get a beater car for now okay and

you're gonna be um you're gonna have some hedge head hanging because you're gonna like walk around a little bit of shame because you were driving a brand new car and now you're driving a car that your fiancee is going to be like oh are we still in love i don't know if i still love you just kidding she she'll still honestly if i get rid honestly I got rid of this, I do not care. I don't have a problem with driving an old car. No, I'm playing with you. Of course, I know. But yeah, I would.

You got to scrape together a difference, either with cash or with a loan. And that's the only times we say it's okay to get a loan, because this is getting you out of debt so much faster. So I'm wishing you the best. This is not going to be fun. We're amputating the Tahoe, or in this case, the Toyota. Never trust a dealership, man. You got hosed. And I'm wishing you the best. This is not going to be fun. We're amputating the Tahoe, or in this case, the Toyota. Never trust a dealership, man. You got hosed, and I'm sorry.

But, hey, we're going to send you Financial Peace University as a little wedding gift on us, so hang on the line. This is The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. The number to call is 888-825-5225. We are about to kick off our live event season. We've got the Entree Leadership Summit event happening soon, and we also have Total Money Makeover Weekend happening May 10th and 11th. And this is the whole gang, all the Ramsey personalities, Dave Ramsey, Dr. John Deloney, Ken Coleman, Jade Warshaw, Rachel Cruz, myself, and we are going to

help you create good, healthy money habits and change your relationship with money for good. So we're going to cover all the things you want to know. We're hitting the classics, of course, getting out of debt, creating a budget, communicating better with your spouse about finances, easing anxiety around money with Dr. John Deloney, how to make more money, and from the long-term and the short-term with our friend Ken Coleman, how to invest, build a retirement of your dreams, how to own a home instead of it owning you. All of that is happening. So this weekend-long event is the ultimate motivator to get you fired up and live the life you've always wanted. We're going to be doing a live taping of Smart Money Happy Hour with Rachel Cruz and I on Friday night. You don't want to miss that, along with

a kickoff from Dave. There's going to be live interactive q and a's throughout the weekend we'll all be hanging out meeting you hang it's going to be such a good time we had a great time last time we did this uh a different event up there at the new rec center and it's a it's a destination event now people come from all over the country just to see us and hang out yeah and i kind of got my feelings hurt we weren't doing a live recording of my show and then i realized probably not probably not good for for morale yeah we want this to be a pep rally john not a whoa yeah i mean your show is wonderful yeah but it's it's it can be awkward with a couple thousand people and their kids in the audience yeah maybe not not quite cut for a live event crowd quite yet not live family event crowd that's

right yeah but hey this was adults only, perfect. That can be a separate event. That's an add-on. So don't wait to get your tickets. Platinum tickets already sold out. You can still get VIP. Sorry, Platinum Plus is already sold out. We have Platinum and VIP a few left there. General admission still available. Get your tickets now at RamseySolutions.com

slash events. Get it in the budget. Plan to join us. We are less than a month out and we're getting pumped. All right. Jonathan is on the line in Atlanta. What's going on, Jonathan? Hey, George and John. Hey, how you doing? I'm doing all right. How can we help today? Well, just to start this off, I got a lot of pressure on me and i'm just trying to figure out my options i guess you could say um what kind of pressure yeah where's that pressure coming from my family unfortunately wife kids who who exactly uh my dad my brother how old are you um i'm 23 all right they don't get a vote

are you hear me i'm not even laughing normally i'm kind of a clown i'm not even laughing i can hear it your voice dude they're burying you they don't get that they don't get that that privilege anymore. What's going on? Well, both my brother and dad, they... Don't care about them. Tell me about you. What's going on with you? I'm stressed out, man. I know you are. I can hear it. I can hear it. What's up? I'm looking a way to increase my income so that I can have like a good nest egg for my future and also like gain some skills and whatnot I'm only making 36,000 a year right now and I don't know if I'm like heading in the right path what do you do for work I'm a Lowe's sales specialist. I sell washing machines and

fridges and all that stuff. Okay. Did you go to school? No, no. I almost did, but I backed out at the last second. Okay. So what are you wanting to do? If we snapped our fingers and you had a career, do you have something in mind? You're like, this is really what I'm aiming at? Or are you totally lost in this space? If I'm going to be honest, a bit of both, but I always wanted to own my own business. I do have a small business right now. I make small little wooden tech decks and all that, and I sell it out to people. It's a small business, but in the future I would actually love to upgrade to full-size skateboards. Okay.

So kind of woodworking and with a niche of making skateboards. Yeah, and sales here and there. I'm also really good at sales for my job as well. And where is the pressure coming from? Are your brother and dad like, hey dude, you're not doing well?

Like, what are they saying to you? Well, this is going to sound weird. Quite the opposite, actually. They're telling me like, oh, like, we see something in you. We think you can be successful and all that stuff. And they've been saying that, like, I guess all of my life. And honestly, I don't want to let them down. I'm sorry? that stuff and they've been saying that like i guess all of my life and honestly what's their end game let them down i'm sorry what's their end game with this do they have a business together

or something they want you in on what's the heart behind that honestly i i don't even know dude Dude, they see their brother and their son making $36,000 a year as a salesman as a 23-year-old. And I know that's not a ton of money, but in the place that you're doing that, you're doing a good job. And you help guys like me who literally know nothing and i come into lowe's and i say hey can you help and you're like yeah i got you what do you need i think beneath your dad and your brother you don't like you man i can hear it why do you think you're why do you think you have failed, man? You're 23. You're learning the ropes of a huge corporation and how to sell and helping out people from elderly folks to knuckleheads like me to even more knuckleheads like George.

You're learning how things work. You're 23 years old. And if you figure out sales at 23 and 24 and 25 and then all of a sudden you're running the department or you move on to selling oil equipment, you're a multi-multi-millionaire. But you don't like you, dude. Why?

I feel like I could do better, I guess. What does that mean? Be very specific. Paint me a picture. What does that mean? Paint me a pic. Be very specific. Paint me a picture. What does better mean? I really want to help my dad, my brother. Stop. Stop.

Stop. You. You. What does better mean? Because they love you. They see it in you. And I bet they're telling you that they see a spark in you because they're tired of watching their son and their brother walk around with their head hanging down. Or let me put it this way. You are making more money than I was at 23.

I don't think this is about money or nest eggs. I think you're not sure what your purpose is, and you're listening to a lot of voices, and you haven't really figured it out for yourself. And I'm not sure you believe in Jonathan anymore. Fair. That hit hard. So, man, close your eyes for a minute. You're 33. Not dad, not brother. What do you want to be doing, man, close your eyes for a minute. You're 33.

Not dad, not brother. What do you want to be doing, man? I guess owning a business. Okay. Making sales and, yeah. Then I would tell you, if you were my brother or you were my son, you are right where you need to be. And you probably need to be doing some stuff on the side because $36,000

is not a ton of money in today's economy. Or you need to be asking the folks at Lowe's, hey, what's the growth path? Yeah, how do I move up and sell bigger ticket items? I don't know a lot but i know that a good salesman can is can move industry to industry a good salesman is a great person to have around because they just know how to talk to people they're good with relationships that skill transfers and you can make crazy money everywhere

and we talk to those people on the show. So Jonathan, we believe in you and one of the ways we're going to help you believe that is by gifting you a few items. One is John's book, Building a Non-Anxious Life because you said you're stressed. This is going to really help with some really tactical things you can do. Another one is Ken Coleman's book, From Paycheck to Purpose.

That's going to help you figure out that clear path to doing the work you love. And finally, I'm going to give you Ken's new book, which is on pre- presale right now. Find the Work You're Wired to Do. It includes his Get Clear Career Assessment. I want you to take that, and it's going to give you a much better picture. You're going to call us back and say, I know exactly what I'm supposed to do.

I'm feeling so much more encouraged. I'm on the path. And stop listening to voices that aren't helping you grow, my man. We believe in you. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. If you're enjoying this show, be sure to check out all the other great shows on The Ramsey Network, including my friend Dr. John Deloney's show on podcast and YouTube. And, of course, George Campbell YouTube channel, which is popping off. Not quite as big as John's.

John's has had a hockey stick lately. I don't know what happened, John. Yeah, trust me. The team's been doing a killer job. I don't think it has anything to do with you. Zero to do with me. But congratulations on all of the success. And, of course, all of our personalities have some great shows out there.

So if you get, you know, tired of the Ramsey show, there's so much more to choose from and it's free. So go check it out. Podcasts, YouTube, you can check out Ramsey Network or wherever you listen to podcasts and catch up this weekend. Joseph is down the road in Nashville, Tennessee. What's going on, Joseph? Hey guys, how are you doing? We're doing well. How are you? Doing pretty good. So my question, I just listened to the audio book of the Baby Steps Millionaires, and I got a lot of good insight out of that. I put my $1,000 in savings, so I was moving on to step two. And one question I have, I get a quarterly bonus at work, and it's usually around somewhere between $2,000 and $3,000.

So I've got two credit cards that I'm looking at paying off, one $6,000 and one $7,500. So my question is kind of how would I take that extra money and what's the best way to apply that to those cards? Yeah. Well, I love that you're wanting to aggressively attack this debt. Do you have any other cash in the bank? I mean, just my regular cash flow, you know, as far as my regular job. So I do pay a little more, you know, than the minimum balance on those. So I'm trying to knock it down that way, but I definitely want to leverage these quarterly bonuses to help me, you know, knock out those big chunks. Well, with the debt snowball, you would just lay them out smallest to largest,

ignoring the interest rate, and that bonus would cut that one 6K card down to three, right? Yeah, yeah, that's kind of what I was thinking. And you'd make minimum payments on the other card and keep attacking that smaller one until it's gone, and then you'll free up that payment. You can roll that into the $7,500 credit card and, again, aggressively attack that one. Is that all of your debt? Yeah, that's it. Yeah. I don't have any car payments. I do have a house. So, you know, obviously that would be the next step. Okay. What's your household income? I am the only income earner and I make a salary of $124,000 for the bonuses. Wonderful. What caused you to go into this credit card debt if you salary of $124,000 for the bonuses. Wonderful. What caused you to

go into this credit card debt if you're making $124,000? Well, at the time, these weren't really typical spending habits. I don't really leverage those cards for clothes or any shopping or anything like that. I had some incidentals pop up, like an air conditioning unit go out, things of that nature, where I just didn't have the emergency fund set aside, right? And so that's kind of what spawned me into looking into setting myself up for a better situation for the future, getting my finances in order. Well, you'll be down to about 10K of debt after this bonus, and making 124K, I would set a very aggressive goal to go, hey, could I put an extra two grand this month on this card? I'm going to be done in five months. And then I'm going to start building that fully funded emergency fund. And that becomes your I never need to go into debt again fund. And when I cut up those credit cards, man, this amazing thing happened. I was unable to go into debt. I couldn't do it. You just can't do it by overdrafting your checking account. And so I think that's a great plan for you. As soon as you get these cards paid off, cut them up and never look back. Kyle's up next in Des Moines. What is going on, Kyle?

How's it going, guys? We're doing great. How are you? Good. Yeah, so I'm calling. I have about 78 K debt. Um, the majority, I mean, it's like 35, 37 is, um, my house and like 26 is, um, vehicle. And then I have the remainders like a student loan. Um, you $35,000 on your house? Yeah. Yeah. Wow.

Amazing. What's it worth? You know, with the housing market right now, I honestly don't know. I mean, I'm in Iowa. I have an acreage. Cool. It's a five-bedroom house on six acres. So $42 million in today's market.

Well done. Right. Um, but so I, I have a large family. Um, I have four children and a fiance. Um, and, uh, we had discussed possibly selling my acreage, um, to kind of eliminate the debt. And there's like a situation where we could possibly get some land and throw a house on, but then it's like, okay, then we're just acquiring more debt, I'm sure. But I guess my main question is, should I attack my vehicle first? I'm new to Dave's strategy, so. I'm a guy who's got a house on some acreage,

and I would tell you let's exhaust every possibility before you start selling dirt. Is that fair? Yeah. How much do you make? What's your household income? I bring in about $70,000 a year. My fiance

we just had a kid last year so she's kind of just doing odds and ends stuff to make ends meet right now. Okay. Are you guys struggling to just pay the bills right now? Kind of, but not really. I think it's more lifestyle living that's affecting us. What's the car worth or the truck?

It's a Kia Sorento. I honestly haven't even looked it up, but, um, If you're really feeling the pain, you could always downgrade in car and pay cash. And if I'm you right now, I would sell that car before the weekend is over. Right. Yeah. Cause we had talked about like, she didn't want to go the minivan route. I was all about the minivan route, but so we ended up going with SUV because of winters here in Iowa. But I've kind of been pushing the minivan route more in dirt head.

I would go with the used Camry route for a while. Yeah. And I know it makes it a pain for getting strollers in and out and car seats in and out. I get that. I got kids. But right now, y'all are broke and yeah i would rather give up the convenience on the day-to-day stuff and bring peace back into my house right i

would sell that car and that would knock off what half your debt right there yeah your house we don't even consider that part of your consumer debt problem, right? So you not like back your house up for a second, pay your car off. I mean, sell your car. And the student loan is the smallest, right? $10,000 car and you're good to go. Yeah. So if you sold this car, downgraded, knocked out the student loans,

that just leaves your mortgage. And so are you doing an investing right now? No, no, I'm just, I'm honestly paycheck to paycheck. I need to get on budgeting. Okay. Well, I'll give you the spark notes here and then we'll give you a free tool to help you with the next step. So the baby steps as they're laid out, they've been working for 30 years when Dave came up with them in this order and they work every time you work it. So baby step one is a thousand bucks. You have a thousand bucks in the bank? Yes. Good. Okay. Baby step two is going to be knocking out all of your consumer debt, everything except the house using the debt snowball method. And all that means is smallest

to largest balance, ignoring the interest rate, throwing as much as you can on the smallest debt, make minimum payments on the rest. Okay. And I've done that. I mean, I just knocked like this last week, I knocked out eight, nine000 in credit card and those. Amazing. I heard you guys on the last guy. Good. Thank you for listening. Cut those damn credit cards up, correct? Yeah. Cut them up, close the accounts. They have not been a blessing to you, and they will not be in the future, because you're the secret sauce. Your income, not a credit card company's cash back or points and that freed me when i did

that when i was a young man or 11 years ago now quick question um and i don't mean to take up all your guys's time but um so dave ramsey he's basically don't even worry about your credit score right because i'm because i'm assuming when i cut those credit cards, my credit score is just going to tank. It might take a temporary dip. My credit score is zero. Right. The funny thing is when you think about it, why I stress about credit scores, credit scores allow you to take on more debt. And so our job is to help people get out of debt.

Yeah, and that's what I caught from the last conversation that you had with the other guy. You already have a house, so you're good. What do you need a credit score for? Kyle, if I gave you a million dollars today, $1 million, your credit score would stay the exact same. Yeah, sorry, I didn't mean to cut you off. Yeah, your credit score would stay the exact same because it's not a reflection of your wealth,

your checking account is, your bank account is, not your credit score. Yeah. Okay, so from your guys's perspective at I'm 38, like I need to take on more jobs to become a millionaire, correct? It's not necessarily more jobs. You do need to increase your income. You got four kids and you have a great income, but man, we got a ways to go. So you're 38. You still got a good, you know, 30 working years left to clean this up and build a nest egg. And we're a ways to go. So you're 38, you still got a good, you know, 30 working years left to

clean this up and build a nest egg. And we're going to help you. We're going to gift you Financial Peace University, watch all nine lessons with your spouse. We're also going to give you every dollar premium to make a plan for every one of those dollars coming in. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm hosting today with my friend, Dr. John Deloney. I'm George Campbell. Give us a call at 888-825-5225.

If you want to talk about money, relationships, emotional health, boundaries, or lack thereof, John is going to be your guy for that. And he's been sitting with hurting people for 20 years now, helping them navigate relationships and take the right next step. And of course, classically, if you want to talk money, I'm ready. Let's do this thing. Liz is on the line in Houston to kick us off. What's going on, Liz? Hey, guys. First of all, thank you so much for taking my call. I really appreciate it. Absolutely. Thank you for calling.

Hey, before you ask your question, what's happening to our Astros, Liz? Don't get me started. I'm trying not to get started myself, but all right, we can talk offline because I'm having trouble sleeping at night. A while is up here. I know. I know. So the problem is, well, so I'm 60, I'm a nurse. My husband's 69, he's retired. And he, I guess, retirement and running around and living the life, which he should after 40 years in the oil field, he got into gambling. And so he'd run up to Oklahoma and do some gambling and all this.

So how bad is it last? Right. So last August, um, I really got involved with, uh, the Ramsey stuff. And I thought, wow, this is pretty impressive. And so I got, uh, his book, you know, The Financial Freedom. And then I also got Dr. Deloney's book of The Non-Anxious Life because he was stressed about, you know, retired and all that and kind of running around, didn't really know what to do after being such a workaholic.

And so since then, he's gotten help for the gambling. He's really, he's stopped. I mean, it's like it was a phase, but that phase left us about $150,000 in debt. What kind of debt? Credit cards? Well, credit cards, yes. Good. God almighty. Yes, and I know, and he was, you know, really embarrassed, and how I found out about this, I mean, I have a few credit cards, and I'll use them, you know, go to work, get gas, you know, whatever, pay them off, whatever. And so he's always had his own credit cards, business credit cards, and so forth. And I know it sounds irresponsible, because he's so responsible, never paid attention, and never been a problem before, you know, this.

So I got the financial freedom book and I was going through everything and I was like, okay, let's lay everything out. And he very shamefacedly produced these bills. Did your heart stop, Liz? Well, I'm an ER nurse, so it takes a lot to stop that, but I was put on pause pretty good, and I was like, wow, babe,

and he's like, I know, so got him some help for that. You know, he's doing other things now, got involved in hobbies and so forth, so it's not a problem anymore. Do you still have open revolving accounts at your home right so do you do we have what now sir you still have open revolving accounts at your home what does that mean do y'all still have access to credit in your home oh no no that's a that's the first thing we did was cut up the credit card. Okay.

All right. What is your minimum payment on these cards altogether? Altogether, I would say probably $4,000 a month. What do you guys bring home every month? About $7,500. Are you able to eat right now? What are your other expenses? Well, we actually don't have any.

Our property's paid for, land, house. Where is he working right now? He's not. Yeah, his butt needs to go back to work tomorrow. And this is part of his getting well, because he's not, you don't just flip a 140 000 gambling hole switch like this yeah he needs to go back to work tomorrow tomorrow tomorrow yeah yeah yeah we've already had that talk and he's got some resumes out you know i'm talking go to starbucks i would love to have a 70 year old oklahoman oil field worker making my latte for me. That'd be amazing. But he has to,

he's going to, he is going to bathe. He is going to bathe in shame if he is not a participant in helping make this home whole again. Right. And you can have all the conversations, but you got to, you're, you're thinking of selling.

What are you thinking of selling? Well, we actually sold a car already, sold a little car and got that and put that immediately onto a credit card. We probably have 130 in a 401k. No, go to the next one. 401k and then the rest of the investments all together fidelity and vanguard and what have you total up to about 350 almost 400 actually it's like 380 something but that's your total nest egg well yeah that was our total nest egg and then we also own land quite a bit of high dollar land and which we don't want to sell so what does quite a bit of high dollar land and which we don't want to sell. So what does quite a bit of high dollar land mean? How much? Well, north of Houston, it's, uh, you know, Houston's moving up that way. So we have our homestead, which is, you know, about seven acres with the home on it. And then we have land

across also in the same little town that's about three and a half acres. Altogether, that whole holding is worth about a million dollars. I would sell that three acres of land. And I know you don't want to, but I can't tell from your voice, Liz, I've talked to a lot of people over the years who are with folks in this very similar situation that they found out that their spouse has massive, massive amounts of debt, whether it's gambling or otherwise. I don't know if your years as an ER nurse have,

I've been around some, some trauma, trauma medical providers who are basically like walking Xanax is nothing rattles them anymore. And that may be you, or if you are simmering X on board, but just super, super patient.

And the fact that, you know, we've made good headway and the gambling stopped. I don't think... I'm wondering if you've fully metabolized how bad this is. We call it financial infidelity. I'm probably not. Do you know what the interest rate is on these cards? Yes. The cash advances alone are like 30%.

Oh, my God. So, listen, part of the hole that was dug is going to be rectified with part of your dream that y'all had. It's going to be a cost to this. Right. And either he goes to work tomorrow and says, I can make $50,000 over the next three years and 100% of that goes to paying this off and I was going to be retired from 70, 71, 72, 73 and now I'm not. Or part of your million dollar retirement,

your land holding, is going to go to dig yourself out of this shovel. There is no way that your life doesn't look different. Y'all are trying to just nickel and dime this sucker. It's not going to work. It's not going to work. When you have $5,000 in interest alone happening each month. So you got to get rid of this. You got to sell these acres. I don't want you decimating this nest egg and unplugging all

this growth because there's not much there to begin with to get you to live for the next 30 years. Do not sell your investments. Yeah. So I would sell the land first. I'm so sorry. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. We've got a lot of fun things launching around here. One of those is Ken Coleman's Get Clear Assessment paired with his new book, Find the Work You're Wired to Do. And so the Get Clear Assessment has been going gangbusters, been helping a lot of people. And so this book is going to help people live out the principles and get a really clear picture of the work they do best and love the most and how to use these results in their job search. So the assessment and book combo will answer four of

life's biggest questions, who you are, why you're wired that way, what you want to do professionally and how to get there. And this self-awareness is going to point you in the right direction, give you clarity and confidence. So you can pre-order the Get Clear Assessment, find the work you're wired to do right now. You'll also get the audio book and ebook for free, along with the assessment and the book. A lot of good stuff. Go pre-order it at ramsaysolutions.com slash store. All right, let's go to the phones. Howard is in Indianapolis. What is going on, Howard? Basically, it's kind of a relationship and financial thing.

I currently have a girlfriend. We've been living together for four years. I guess the thing that I haven't moved forward, one of the reasons for making a full relationship, marriage, and all that stuff, is financial. I'm a responsible person, I feel, and she kind of never wants to talk about the budget, even though she wants my help sometimes. And she has an attitude like,

I'll do my thing with my own money, but yet when she wants money or help a little bit, I'm always there. So I feel I have the right to, especially, like I said, I have one credit card under my name that she got for a washing machine that it could have been paid off,

it's not been paid off, and there's some other things down the road too. Wow. Bro. You just spit a lot at us. It's not, it's not, well, I yeah, well, I'm trying to be quick. She said be quick, but it's not as, you know, complicated as, you know, it may sound, but it is, you know, to me.

At first blush, this sounds a lot like Howard's fault. She has a credit card in your name that she used? My background, I'm pretty responsible, meaning, because my dad was a huge gambler, so me and my siblings are pretty responsible with money. And I guess the point is she has the money to do stuff that she would budget and we'd work together, but she doesn't want to work together. And if I confront her about it, you know, it's almost like not my business, but yet when you, like the other day, she needed some money to help pay a bill, even though really if she buzzes her money, there's no reason why we can't pay a bill. Hey, hold on. Howard, Howard. You called in.

How honest can I be with you? Oh, brutal. I'm not something brutal, believe me. I don't think that you are. You're totally good? Yeah. No, I am. Yeah, totally.

All right. This relationship is long over okay okay long over and here's here's here's what i mean um no i look i've been told that before okay money is as a symptom and if you as a guy who grew up in a traumatic household, let's take money off the table. You grew up in a household and dad was an alcoholic and he was abusive and the whole house was electric. And you put a little GPS pin in alcohol and you committed, I'm never going to drink. And you're with somebody and you're planning on spending the rest of your life with them.

You've been with them four years. You'll share a house. You'll do this life together. Okay. And you would say, hey, I don't want to be around alcohol. And every night she walked in with a bottle of wine and a vodka tonic and was like, I don't give a crap what you think. It's my life. I'm going to drink.

Everyone in your world, including you, would know this person is not willing to align values with you. She does not care what you think. And so forget the money thing. Any relationship has to have two people that will sit down at a table and say, hey, me to death and the other person says i'm in or i'm out and y'all keep making this about money and here's where this leads which is right where you are bro you think you're better than her and the only power leverage she has over a guy that thinks he's better than her is this i'm gonna do whatever i want and that's the way she can hit the other side of the teeter-totter and that's why i tell you y'all are just in a

playground going up and down on the teeter-totter i'm smarter than you i'm better than you yeah i can do whatever i want and i'm smarter than you i'm better he's going up and down up and down i got you see i'm saying at some point you got to get off the teeter-totter and say, I love you, and I have to have somebody who's willing to sit down at a table and hear me when I say I'm scared to death about how you spend money, about how we do life. I agree, and you know what? Honestly, and this sounds bad. It's almost like we're separate.

I've taken my own entity and started taking care of myself financially individually, which is bad in a relationship, but I've done that. Well, but here's the thing. When I say it's over, y'all are roommates. Who's going to have the courage to sit down and say, what are we doing? I got you. Because now you're choosing on a daily basis,

both of you are to live in misery. Y'all both are worth more than that. That's a strange choice to make in a country where you can kind of do what you want right to work together but she just doesn't want to we don't i'm not saying we're rich we have the means to work together absolutely but we just don't do it but you you understand y'all are both choosing that right yes i know i totally i totally okay what's your path back what's my path back to what?

Trying to get this to- All right, let me ask you this. Are you done, dude? Are you done? It sounds like you're done. It sounds like we're like having nachos at a bar and you're about to break up with her and you're just like, ah, and this and this.

I don't want to. I don't want to. Honestly, I held off. I didn't talk about, like I said, I just recently found out about that bill that wasn't paid because I kept getting text messages. Hey, hey, hey, you and I and all the other 20 million people listening to this know this is not the only thing that is divided in your home. Oh, my God. You're probably right, but I'll say this.

I put this off until I come back. I'm actually going on a trip, and then I'm coming back. I didn't want to put this off and have a fight before and all that stuff. That's funny. But I'm right, right? No, you are absolutely right. I'm not disagreeing with what you say. Okay.

At some point, one of you has to be the adult and turn the lights on turn the music off stop the party and say hey life is too short for us to be this far apart and for this to dishonor each other this much every single day of our lives we have to have an honest conversation about where things are and more importantly are we both going to continue to do this tomorrow do i think everything has to be over forever no but it's going to take two people who have not acted like adults deciding we're going to act like adults and wade into some really murky water and figure this thing out to get to the other side okay i agree the last thing the hard part part of our separation is she's so focused on her career that she's trying to establish a real estate, and that's the other part.

But that's another story another day. No, no, no, no. It's exactly what you said. You've created your own life. She's created her life. Did you ever see the Office episode where Michael and Jim are co-managers? That's y'all. Y'all are co-managers of the house.

And that is a terrible place to build intimacy, raise a family, and create legacy. Oh my God. And what makes it messier is you guys already live together. Yeah. Now you get to unwind that.

And people call us like... It's very mechanical now. You're right. Yeah, but at some point you wake up and you go, wait, this is just like a cool roommate that I have to like

beg for the bills from. I mean mean that's not a fun way to live no yeah i got you i know you guys splitting bills right now down the middle and you like venmo each other how does this work um really it started out because again we've never really talked about it so we're like roommates so i kind of made the assessment initially and i stopped it six months into it three three years ago i paid like $1,000 towards her mortgage, basically, which was her mortgage at the time. Wait, you live in her house? Yes.

Well, this just got interesting. Bro. Yeah, I live in her house. So you're about to get evicted. No, you're going to have to find your own place. And let me be honest with you. I did stuff stupid. You know, you're in love. I got rid of all my furniture. I guess I let me be honest with you. I did stuff stupid. You know, you're in love.

I got rid of all my furniture. I guess I get rid of all my furniture. I did stupid stuff. Okay. I want you, if y'all do end up separating, I want you to be a grown-up about it, and we're not going to, like, dip in the same boat here.

Here's the deal. If George and I, I guess if this ever happens, that wouldn't be great, but if George and I were college roommates, let's go back that far, we would have better arrangements than y'all have well we'd be doing karate in the garage we'd be doing karate in the garage for sure right and sword fighting on the front yard but we would also have talked about clear expectations yeah clear expectations who's paying what bills y'all haven't

even done that i hate to be the the bearer of bad news, my brother. I am committed to reconciliation, but this one's going to take some skills that I don't know that you two have. We'll be right back. Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. Open phones at 888-825-5225. Well, our friend Rachel Cruz is on the road right now. She just launched her latest kid's book, The Second Installment, I'm Glad For Where I Am, a beautiful book about contentment.

And I'm excited to read it to my seven-month-old. She doesn't really know what's going on, but she likes the picture so far. Are you glad for where you are, George? I am. I'm in the studio with John. Off the air, you were just telling me. Are you glad for where you are, George? I am. I'm in the studio with John. Off the air, you were just telling me you're not glad for where you are. That's not true. Bold-faced lie. You sit on a throne of lies.

You're not Santa Claus. I think I was telling the truth there. But hey, if you are in the Dallas area, good news for you. Rachel Cruz will be there tomorrow, April 20th, at the Lincoln Park Barnes & Noble from 1 to 2 p.m. So go join her. She's doing a book reading to the children's. And if you're just a grown adult with no kids and you just want to meet Rachel, you can do that.

That's your prerogative. And if you're ever wondering if he's real or not, her smoke show of a husband, Winston, has been seen. Oh, he was in L.A. on the L.A. stop. Traveling with her, too. So maybe he'll make a surprise show up also. That's really why people would show up to hope for a winston sighting he's better at every part of life than i am he really is he's who we all want to be we're very jealous but hey go see rachel on her book tour for

i'm glad for where i am dallas is the next stop the 20th 1 to 2 p.m lincoln park barnes and noble and uh she'll love and she's been telling and said, hey, everyone's asking about where's John and George. And we have to tell them that we were not invited. Yeah, we weren't invited. Someone's got to keep the show going. That's right. Someone has to heal America. Corrousing around the country.

Robert is up next in Fort Worth, Texas. Robert, what's going on? Going good. How's it going, guys? Thank you for taking my call. Sure. How can we help um so i am potentially getting ready to start um doing a development deal on some property that i own here um in the arlington area um we're like a block away from this Cowboy Stadium. And I have

currently no debt. We do as much as we can to stay out of debt. And taking on this construction loan obviously would be a considerable amount of debt. I don't have exact numbers yet,

but I'm imagining right around a million dollars. The property fully developed would be worth $2 million plus. What's your business? My business is not real estate at all. Where did this come from? I'm sorry? Where did this opportunity come from? Well, so long story short, I inherited these properties. My mother and my father both passed

away. I'm 37. My parents passed in my 20s. And all of a sudden going from, you know, not having really anything to managing, you know, things that I wasn't aware of, I didn't really do much, right? I just kind of had a hold pattern, be very safe with everything. We were mainly focusing on the business, trying to keep it going. You know, after she passed away, we had to close her business, start our own, which you asked earlier, we sell and dispense hearing aids and help people hear better. And so I have this property that when I inherited it, it was maybe around $100,000. Now it's $370,000-something.

This is just the appraisal value, right? I'm not sure it would sell for a lot more. The proximity to the Cowboys Stadium is what's driving this because I know that this property is very valuable. So what's your goal here? You have a property on that plot of land right now. What are you wanting to do? I want to turn it into a fourplex.

Okay. And whose idea was this? That's mine. All I can tell you is what I would do. I would not take a gift that comes attached to the memory of two really important people to me and leverage it for a million-dollar loan on a fourplex in the shadow of Cowboy Stadium. I would sell that property,

and I would take the $400,000 or $500,000 or $600,000 you'll get for it. And I'd write a letter to my mom that I'm never going to send her obviously, but I would thank her for her fidelity and her stewardship and let her know, mom, I'm going to not put my family on the block. I'm going to take care of this thing and honor this money. Thank you. That's what I would do with it. Okay. And so the calculation between the selling the property, you know, because currently we have our current business on it, right? I have no problem keeping the property as is and, you know, just keeping my business on it. And, yeah, the selling the property has come up.

It's one of those things that we do. We rent out part of the property for Airbnb. We also run our business and we also have a parking business for the stadium on there. So we're really... And this is profitable, I'm guessing, all of these things. Oh yeah. What's your household income? It's about 150 after everything. And again, we're getting almost no debt you know about 90k on the house and so we're you know a good situation we're very blessed and we know this is your goal to rent this fourplex my goal is to sell it

I want I want my son to have the benefit of what I had when my parents passed I want we just had a son. He's a year old now. Won't he have that even if you stay where you are with what you have? Well, like you said, to be a steward of it is not only to hold it, it's to do what you can with it to improve, right? And so I want to improve upon it. But you have a cash flowing asset that's paid for, and you're telling me you want to go a million dollars into debt with a whole lot of risk and hopes to grow this asset. Well, and that's

what I'm calling. And knowing without a doubt that by the time your kid gets to be 25 to inherit this asset, the Cowboys will have moved somewhere. Yeah. Or they'll be doing some construction project

and eminent domain this property anywhere. You see what I'm saying? I would love to see you have $500,000 and put that away in a good growth stock mutual fund and hand him $10 million cash. Okay. And your primary residence, you pay that off. That becomes an asset

on top of your business. And so I'm not worried about legacy. I think behind all of this is also a little bit of starry-eyed, man, we can make some serious money here. Absolutely. No denying that at all. But again, I'm coming from a place of ignorance, right? I'm trying to find the best way. Well, I mean, we are not real estate experts,

but we are experts on our opinion. And I'll tell you how Dave has built this place. He got burned in real estate. He had a few million in debt, as you probably know his story, going bankrupt in the 80s. And I'll tell you, a lot of people don't even believe this,

but he cash flowed this entire property that we're sitting in right now. We moved at the speed of cash. And he could have done it much sooner with other people's money, but he's been there and he's done that. And the financial weight it carries, the emotional weight, the spiritual weight it carries was not worth it to him

to ever have to report to a lender ever again. I mean, I feel that, yeah. So then it turns into, okay, well, how could we cash flow this million-dollar project? Well, it might take us getting the income up for the business. What else could we do? How could we put away $200,000 for five years and do this five years from now? That's what I would be doing if I was in your shoes. Okay.

So it might work out. You can do it your way. I'm not saying it's going to all be a house of cards. I'm just saying we've seen enough of these stories to know the starry-eyed thing that looks good on paper ends up being the next call on the Ramsey show where they went, we're a million dollars in debt and this property has been a nightmare and it's not cash flowing. Should we sell it? Well, and that is, I think the best thing I could tell you is what I would do in my own house. And that'd be really cool. If my parents passed away and left me a hundred

thousand dollar piece of property that's suddenly worth five, six X, what it was. That'd be amazing. And I think that is that in and of itself is beautiful. And I think when we don't have a psychology for what the word enough is or what a win is it's easy to go, yeah, what about this? What about this? What about this? And there's always some guy at the bar that's like, well, if I mean, if I was you, I would know you wouldn't, you wouldn't, but it's easy to go, yeah, what about this? What about this? What about this? And there's always some guy at the bar that's like, well, man, if I was you, I would. No, you wouldn't. You wouldn't. But it's cool to say it when it's somebody else's money and somebody else's life and

somebody else's memorial to their mom and dad, like their stewardship. And we don't say this because we're like, well, they work for Dave Ramsey. No, we say it as guys who had a bunch of debt and now don't have any debt. And we like this way a whole lot better. And nothing in our hearts wants to go back. So I hope that helps, Robert, making this decision. It's a big one. I hope you make the one that's right for you and your family. This is The Ramsey Show. Welcome back to The Ramsey Show.

Our scripture of the day, Psalm 8611. Teach me your way, Lord, that I may rely on your faithfulness. Give me an undivided heart that I may fear your name. Mark Twain said, don't let schooling interfere with your education. What a man of wit he was. The way with words he had. I don't know why I talk like that, John. I'm sorry. I'm here with Dr. John Deloney. I'm George Campbell. We're taking your calls at 888-825-5225. Shelby is up next in Houston. What's happening, Shelby? Hi.

Hey. So let me get to it. So my husband had a business for about five years, and he recently closed that business in February. It was a construction business. He basically racked up about $176,000 worth of debt on material from one distributor. And that distributor is now suing him personally because he signed a personal guarantee for that debt, I don't know, a couple years ago whenever he started to incur it. Um, so my question is, do we, does he personally file bankruptcy or do we use our home? We have, um, a house that's probably

worth between 320 and $350,000 and we owe about $90,000 on it. Do we sell it or get an additional home equity loan on top of what we already owe and make an agreement for the $176,000, try to get them to take less? Is this all the debt you have? Yeah, we really don't have a lot of debt. I have a car, but the car doesn't. It's minimal. I think it only has like $8,000. No, you have a lot of debt. I have a car, but the car doesn't. It's minimal. I think it only has like $8,000.

No, you have a lot of debt. I don't know if you missed the part where you have $176,000 in debt. Yes, we do have that. Plus $8,000 on the car? Yes, and then $90,000 on the house. Okay. Let's remove the house out of the debt for now. I want to take bankruptcy off the table.

Okay. Okay? That's not necessary. What's he doing right now for a job? He currently works as an electrician, so he is working. Full time? Is he making money? Yeah.

Yeah, he makes good money now. Okay. It's way better than what he had with the business. And are you working outside the home? No, sir. I stay home with money now. Okay. It's way better than what he had with the business. And are you working outside the home? No, sir. I stay home with my kids. Okay. How old are you two?

I am 32, I think, 32, and he's almost 40. Okay. And what's the household income with his electrician job? I would say yearly he's at like 115. Wonderful. Okay, and what has his communication been with this distributor about the debt? They are willing to negotiate some kind of agreement directly with us at the moment because it's not with collections.

Okay. But they are currently trying to serve him and sue him for it but they are willing to negotiate they're only trying to sue him well they're only trying to sue him because he's avoided them like the plague hasn't he no this actually all recently just happened uh well did he think this debt would just disappear because he closed the business no we actually when he closed it in february, we tried to make an agreement with them on like, hey, we will sell like our equipment or give you the equipment and you can have the money in return for the debt. And then they took like three weeks, four weeks to decide they didn't

want to do that. And then they never called us to tell us they didn't want to do it. And then they filed a suit. Right. So where's all the equipment now? At our house. But there's not much. It's probably worth maybe like $30,000 altogether, what he has. Okay, so if you sold everything you could in sight that wasn't tied down before you sold the house, how much could that net you guys?

His tools, his guitars, guitars his fishing boat like everything like 30 okay our house is really the only thing we have value of okay so that knocks it down to 146 could he then get on a payment plan and say listen here's my plan i'm going to pay this off in this amount of time are they not going to be willing to negotiate? I'm not going to go off that, but they want somewhere between $10,000 and $12,000 a month. Which you guys simply don't have. We just can't do that. How old are your kids? A six-year-old and a one-year-old.

I don't see a scenario where, I think it's a terrible idea to sell your house. I think it's a terrible idea to go into bankruptcy. But I think it might be a situation where you're going to have to go work for a few years. And he's going to have to work and then work on top of that and then take side jobs on top of those two jobs. And do you let it go to collection? Like, what do you? Well, that's what I'm thinking thinking if they sue you and get a judgment they're going to do a forensic accounting of what you can actually pay and they'll either garnish your wages or you'll have to turn over next amount of dollars each month and the judge

is going to see you can't do ten thousand dollars a month and so here you do forty five hundred dollars like it's going to end up in the same way for them anyway and if you say I can write you a check for $30,000 as a down payment I'll pay you $5,000 a month or $4,500 a month for the next X amount of months until this thing is paid off at 7% interest or whatever the thing is and I'm going to make this agreement I'll sign it

you got to remember that as far as they're concerned your husband's signature doesn't mean a whole lot right and they may want to go get a judgment and i don't blame them and they may want to go say no no no we wanted a bank to secure this i get all that it is what it is um but what i don't want you guys doing is freaking out and running and jumping off a cliff just because you have this this what feels like a sword of damocles hanging over your neck when it's really not right yeah so bankruptcy is off the table selling the house is a worse worse worse worst case scenario yeah i just worry if they garnish his wages he's the only income for our house

i i think you have to that there's not going to be a way you get through this without your knuckles getting getting pretty skinned out. Either way, he's making huge payments to pay this off or they're garnishing it. So either way, you're going to have to learn to live on less. And if you think that is painful, you having to go to work with a six-year-old and a one-year-old, I promise the bankruptcy proceeding will be infinitely more painful. Selling your house and going to a two-bedroom apartment will be infinitely more painful than you going to get a job, being angry every day. You're going to have to deal with your

anger and your grief over this deal. Yeah, I just quit my job. Okay. It was a month ago to be with my kids. It may not work out because y'all are broke, right? Yeah. And I get that that's infuriating and enraging, and it's also reality. Okay, so no bankruptcy, worst-case scenario, sell the house, or... And when I say worst-case scenario... ...and hope we can make a payment. I think you sit down and say, we'll write you a check for $30,000, and I think in the meantime, he comes up with another 10,

and you'll say, we'll write you a check for $30,000. And I think in the meantime, he comes up with another 10 and you'll say, well, write you a check for $40,000 cash. And I will sign a promissory agreement for, I'll pay you this much. You basically create a new debt agreement for the next two years, three years to pay this off aggressively. And if they say no,

then all you say is we can't afford anything else. Like that's what we got. You're going to buy a 401k, like use money from a 401k? No. Okay. You're going to, that will rob you of not only income taxes you'll pay on that, but also the penalty, another 10% on top of that.

So it's like borrowing money at 30 something percent interest. Have y'all talked to an attorney yet? No. Okay. I would have that conversation because I can't give you legal advice but it's my memory that a into the state of texas um bankruptcy doesn't include your home so even if you file i mean they would lose everything if you file bankruptcy they don't they have a vested interest in you paying them back too yeah we have more of a hand on getting them to take less than well i

don't think you should get them to take less i think your husband took that money i think y'all should pay it back but i think you have to be honest about how you can pay it back i was getting afforded and also might mean he is working an extra 30 hours a week he gets his income up to 20 to 200k and now we're making nine ten thousand dollar payments every month to pay this off and that's not going to be fun. Underneath all of this, a month ago, before you got this letter, this intent to sue,

you had a picture of your life. You quit your job. He's making good money. You finally got out from a bad business he was working in. You've watched your husband just wither away. He closed the business. He got an electrician's job.

He's making good money. I'm going to quit my job. I'm going to be a stay-at-home mom like I've wanted to. And all that's gone now. You just got to own that and grieve it and own it, and then let's head right into it. Let this be a lesson to all of you small business owners out there when you call us and say, hey, we're going to make money off all this equipment. Don't worry. It's going to be great. This is what happens. This is why we steer you away from taking on any business debt and why

you should run your business debt-free the Entrez Leadership way, because it creates more peace, less risk, and a higher chance of success. And even if you fail, at least you don't owe people hundreds of thousands of dollars. That puts this hour of The Ramsey Show in the books. Thank you to John Deloney and all the folks in the booth, and you, America, will be back before you know it. Hey folks, Dave here. You want to hear even more life-changing content from Ramsey? Download the Ramsey Network app so you can catch all your favorite shows all in one place, like The Ramsey Show, Smart Money Happy Hour, and The Dr. John Deloney Show. You'll get real talk about life, relationships, money, and your career.

Plus, the app lets you browse by topic like debt, business, or selling your home. Get the content you want whenever and wherever you want to listen. Download the Ramsey Network app today.