The Ramsey Show - These Bad Decisions Will Steal Your Wealth

Episode Date: April 4, 2024

💵 Sign-up for EveryDollar today - The simplest way to budget for your life! Dave Ramsey & Rachel Cruze answer your questions and discuss: "Where should we invest after paying off debt?" Why bad decisions will steal your wealth, Dave's guide to flipping houses, Fill this "prescription" if you want to be wealthy, Dave breaks down the 4 walls and why they're important, Dave's boomer perspective on Gen-Z's tax trauma, "We bought a flip house with my mom" Support Our Sponsors: Churchill Mortgage BetterHelp Zander Insurance 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 📄 Need help with your taxes? See who we trust. 📖 I'm Glad For Where I Am 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

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 actual amazing relationships. I'm Dave Ramsey, your host. My co-host today is Rachel Cruz, number one best-selling author, co-host of Smart Money Happy Hour, and author also of a brand new, our second best-selling book of hers on the kids list. It comes out April 16th, and it's up for sale right now. And we have been test marketing it among the grandkids, and it's working. I'm glad for where I am.

The first one was I'm glad for what I have, and so her new book coming out soon. So she's going to be helping me with your questions today. The phone number is 888-825-5225. Micah is with us to start off this hour. He's in Huntsville. Hey, Micah, welcome to the Ramsey Show. Hi, Dave. Thanks for to the Ramsey Show. Hi, Dave.

Thanks for taking my call. Sure. What's up? Okay, so I just started the Baby Steps last month, and I have $1,000 in the emergency fund already. It's getting springtime, and my yards are getting pretty high. I'm needing a lawnmower, and I don't currently have the cash to pay for one, but I got like $2,000 that I could put down on, not finance, but just buy a cheap one.

Or I could hire somebody to cut my grass for the summer while I save to buy a nicer lawnmower because I live on like 10 acres, which I'm not going to keep 10 acres cut, but just wondering your thoughts on what I should do on that. Okay, so how much do you actually keep cut? About four or five. Okay, and how have you been doing it before now?

Well, we just built the house last year, and so I really haven't had a yard. Oh, okay. After all the dozer work was done, it was just kind of like a mud hole. Yeah. So we're planting grass, though, i keep trying to keep about four or five acres cut okay so it's not been cut prior to now or if it was somebody else did it right correct it was it was a 10 acre pasture and it was bush hogged up until the time we built how much debt do you have, Micah? Currently we have just the mortgage, and then we also have a car payment.

The car is about $28,000, and we're on track to pay it off by the end of the year. What's your household income? After tax is about $90,000. Okay. All right. Well, you know, the thing on something like this, the beautiful thing about you calling is you're actually thinking about it. Because at this time last year, if you were facing the same thing, you would have gone and financed an $8,000 stupid tractor of some kind, right,

that you couldn't afford. My dad listened to y'all while I was growing up. So, I mean, the only stupid decision I ever made was to buy the car and finance it. And the only reason I did it was my wife and I, we both had faithful vehicles, but we was out growing the car that we was in with a family vehicle. And you used that as an excuse to buy something you couldn't afford. Yeah. Okay.

Yeah, pretty much. Yeah. All right. Okay. And the, okay, so it's a you know it's a math thing if uh your your goal is to pay off the car the more we spend on the lawn through service or tractor purchase either one the shorter i mean the longer the car debt's going to hang around obviously so if you put every thousand you put towards this issue of

lawn uh is a thousand not going towards reducing the car so obviously what you're asking is what you know what's the least way we can do this i don't know i guess get a bid from somebody on what it'll take to mow it and then compare that to what you could buy a used uh riding lawn mower on on facebook marketplace for well i mean if i if i drop 2500 on a lawnmower i could i could do that next month but it would just push the yeah it pushes it out 2500 but are you going what are you going to spend to cut the thing all summer if you pay somebody else to do it probably more than 2500 i would guess right uh yes sir yeah so i mean the cheapest way to do it is to buy a the leastriced used lawnmower

that will get you through the summer. Okay. That's the cheapest way to do it. I had one more question, if you don't mind. Sure. We've been starting our budget, our every-dollar budget. We started that this month. And the miscellaneous category is kind of tough for me to figure out

how much to put in miscellaneous each month just because that fluctuates a pretty good bit. We've got two kids under two. I mean, they can get sick at the drop of a hat, or they might go a couple months without getting sick. There's expenses that we don't plan for sometimes that occur during the month, and we just don't want to kill our budget by not planning enough yeah i would probably up it at the beginning and then once you guys once you guys have done this like three or four months there's usually a consistent or how it worked in

our house that consistent thing that keeps coming every month that we throw in the miscellaneous that we end up just making a budget line item for um now like if kids are going to the doctor every three months or two months then that's a budget line item yes sir i mean and if you got two under two it's like a rule you have to pay the pediatrician's borscht payment i mean oh my gosh you know it's like you have to go over there it's federal law right and so the kids are going to do that when they're little bitties they do that they are yeah and so you're going to have some, you know, so it's really not a surprise. It really wouldn't shock you. And to Rachel's point, if it reoccurs, then you just make a line item for it and put an

amount in that, say, kids medical, okay, in every dollar, and then you lower whatever you put in there, you lower your miscellaneous by that. Yeah, and I would say too, Micah, and to anyone listening that is budgeting for the first time, that miscellaneous category, I would make it higher than what you think you need because there's going to be expenses in your life that you don't even realize because you haven't been budgeting. And so you're going to go through a few months of it to be able to say, oh my gosh, okay,

that's the thing that keeps coming up. Or, oh, we got this way more under control and so we can actually lower the miscellaneous. So I would be more conservative, more liberal, conservative, higher amount on the miscellaneous so i would be more conservative more liberal conservative higher higher amount on the uh miscellaneous category for now micah especially it's not political more liberal i know i was like it's more like here you're not a liberal freedom it's just more money you never know you never know okay thank you yes yeah so how much is a lawnmower though for real no i mean you can buy a push push mower right now, a used push mower,

all day long on Facebook Marketplace for $50. But five acres, that's like 73 days you'll be cutting out there. How much is like a zero turn? I don't know. Do you like that price? Look at that. Probably a couple grand. Oh, five grand?

You can pick it up for two. I used one. But it's not one you want. It's one to get the grass cut with. Yeah. So it won't bake bread and it won't catch fish while you're mowing. And some of them will. So some of them will do it with GPS.

We're trying to basically cut the grass. That's all. And I wonder in Huntsville, what I was thinking, I was like, some kid this summer is going to be doing this for their job. I know, but $2,000 for the whole summer for five acres? I doubt it. Yeah. I doubt it.

I might be wrong. That seems like a lot. I don't know. Okay. $2,000? That's the analysis. I want to go back to the other thing, because when you first start budgeting.

What, that I'm a liberal? No, no, no. We're not worried about that, because you'll just get thrown out of the analysis. I want to go back to the other thing, because when you first start budgeting... What, that I'm a liberal? No, no, no. We're not worried about that, because you'll just get thrown out of the family. Oh, my gosh! We would not have to fire you. You would... But, anyway... I'm here for all people.

Yes, we love all people, but we aren't all people. I'm here for all people. We love them, but that doesn't mean we want to be them. Okay. So the, um, anyway, anyway, I'm a conspiracy theorist. I'll just, I'll just, I'll, I'll own that label. That, that one you can have. Yeah.

That one's legal. Okay. So the miscellaneous, it takes 90 days of doing your budget for your budget to start to work. And part of it is the things you don't expect to come when you first start doing this, like kids medical or activity fees at school or so on. So give yourself some grace to lean into that over the first 90 days. 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.

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Brentwood, Tennessee 37027. Rachel Cruz, Ramsey Personality, number one bestselling author. My daughter is my co-host today. Melody's in Atlanta. Hi, Melody. How are you? I'm good. How are you?

Better than we deserve. How can we help? So we are within two weeks, in theory, of having our firstborn and trying to figure out. Yay! What are you having? I'm so excited. Little boy. All right.

Very fun. Congratulations. Thank you. Just trying to figure out best options for investments moving forward past just like work 401ks and what we can kind of do as a little extra to have him set up. Okay. Is this for your son you're thinking for specifically or you guys as a family or like as a couple? As a family.

As a family. Okay. Are you guys... He'll have to work when the time comes. Yes. Yes. Yes. Yes. couple family as a family okay are you guys still have to work when the time comes yes yes yes yes are you um are you guys working your way out of debt or are you out now no we are out of debt we finished paying off our house two weeks ago oh way to go oh my gosh you're 100% debt free yes sir way to go so you guys are both cars are paid for um one was the one i had when we got married the other one we paid cash for a little over about two years ago i guess gosh that's so So you guys are... Both cars are paid for. One was the one I had when we got married.

The other one we paid cash for a little over about two years ago, I guess. Gosh, that's so impressive. How much do you guys make a year? It fluctuates. My husband works very, very hard. It ranges. He has a salary, but then he has like on the road per diem. And then he has like premium time he can make as

well so so how much do you make a year um salary is just a little over 100 and then his take home last year was a little over two okay that's excellent way to go awesome um yeah i mean i would stick with match maxing out what you can and maxing out uh well you guys will be beyond the roth i think you i think it's you can do a roth backdoor now i'm gonna do a roth i mean if he's under 200 agi so probably somewhere around there you can do a backdoor or or regular you need to be maxing out both roths you need to be maxing out 401ks hopefully in a roth with a match uh and you max out your 529 for the kiddo um and or you don't have to max it out but put five you know six or eight ten grand in there a year and uh if you do that he's going to go to college anywhere he wants to go if you do that he's going

to go to college anywhere he wants to go and if you put all you can put in 401ks and roths how old are you guys um he's 32 i'm 30 okay that alone at 65 will have you between 5 and 10 million dollars just doing that okay you said both roths um yeah so you can you can have one a spousal spousal even though you don't work you can have one espousal, even though you don't work. You can open one, Melody, under your name. All right, so we have 401K with his work. Yes. And then that's what I will use. Is it the Roth IRA, like the personal one?

Yes. I've been trying to do some research on that, but I got a little confused. Yes, you can do a Roth IRA each, $6,000, and he can max out his 401K. If he has a Roth option on the the 401k it should be doing that okay okay perfect and then so what you need to do is jump on ramsey solutions.com and click on smart vestor and find a smart vestor pro in your area these are the mutual fund brokers that we recommend and you can find one that has, they have the heart of a teacher or we don't put them on there. So they're going to sit down and

teach you what is best and what these numbers will turn into. So you're going to be very, very wealthy if you just do that. Now, once you've maxed out all of that stuff, you're at what we call baby step seven, no debt at all. There's nothing left to do, but become extremely wealthy and be wildly generous. That's it. That's all you got left to do. So, and enjoy some money in the process. Um, but the, um, so, so, you know, beyond that, then you start talking about, okay, am I going to do more mutual fund investing or am I going to pay cash for some rental real estate? If you want to be in that world, uh, that kind of thing. Those are the two things I have done beyond maxing out everything. But your first step is get the 529 started for kiddo. Once he's got a social security number, he's arrived, then you can do that and do that in a month or two here.

And you guys max out the 401 with the match and max out both Roths. That's a really good start. And again, if that's all you ever do for the next 30 years, it's going to be millions and millions and millions of dollars. So you're going to be in great shape. But why not even do more? And why not enjoy more? And why not be even more generous? So sit down with a smart investor pro, and they'll help you do all that.

Yeah. And for kids, because I've talked to a lot of families who are like, okay, if we max everything out, what investment options besides just education can I do for my kids? You don't. And they're up my accounts.

I mean, there's other options. You can, but I wouldn't. Why? I would just build the wealth in your name and then leave it to them as a part of the estate. When the parent dies though that's that's well or you could you could if you want to hand them some money yeah yeah that's what i was saying you could you could hand the money at death or you could hand the money early yeah

there's no point in putting it in their name yeah there's no you know because you don't have you lose control and you lose options so when you build wealth you're building wealth for your whole family your family's going to get the use of the wealth so there's no point in putting in the kid's and you lose options. So when you build wealth, you're building wealth for your whole family. Your family's going to get the use of the wealth. So there's no point in putting it in the kid's name because, I mean, the kid may decide that they may have all kinds of problems or something. They can get to it. They own it.

At what, 18 though? 21 on the hut. Uniform Transfer to Minors Act is when you open an account in the child's name utma and put your name on it as the custodian but you do not have control of it so he's doing heroin at 21 he's got a million dollars not this kid but another kid the kid's doing a million he's got a million dollars you just killed your kid because you're going to access that and they're going to overdose on heroin so you have to control it no i mean it's so dramatic no but this is what happens i

mean i've been doing this 30 years i know but i'm just saying though for family okay because because say you're like okay you know you think about melody they freaking have everything paid off i know i'm going i'm going down a road so follow me i'll try uh everything paid off there they have a baby born in a month so in 18 years say melody and her husband are like yeah we'll help with like the down payment on the home because he's not doing heroin and he's awesome he's has a job he's paying taxes he's responsible yeah he's a great kid he's a great kid this one this one this one's gonna turn out and it's like great we we have melody and husband so much money and we want to help our kids continue that legacy so we want to you know say hey here's a down payment for a home or here's

um something that is not college related yeah isn't there a gift tax like doesn't that get into like you can avoid gift tax with uniform transfer to minors act which is a no what i'm sorry i'm sorry you unified estate tax credit I'm sorry I picked up the wrong uni okay um unified estate track tax credit and you can avoid it and move money anytime you need to and of course the other thing is this you can okay gift tax this year's what I don't know 15,000 bucks or whatever yeah something like that and so um let's say that if you want to give your grown kids some money I I need to look. James, find the gift tax and tell me what it is.

Because I can't remember nothing. Oh, it's right here. It's on my notebook. Oh, hello. I got this cheat sheet I should use. All right. Well, they change it. They up it for inflation every year.

$17,000. Okay. So if a married couple has a grown married child in their 20s. Yes. There's four players involved. Yep. Mom can give daughter-in-law and son 17 each, two checks. Okay. Dad can give daughter-in-law and son 17 each in two checks.

So it's 60,000-ish. Yeah. Yeah. Okay. And so that's $64, thousand dollars yeah or sixty eight thousand dollars okay uh in one year if you happen to do it at christmas you do it again three weeks later and you got 128 000 okay right okay and so um you know you can get to just about anywhere you want to get to just using that without even using the unified estate tax credit which means you're using up some of

your estate uh exemptions in the federal by using it against gift tax so you can get your money to your kids yeah while you're alive because that's part of all of this you guys is is changing your family tree and we talk about that yes that is that is knowledge that's character like there's so much there but also i think about the reality of so many people listening now that are so young and if they start doing this they're going to look so much money i have so much money. But also, I think about the reality of so many people listening now that are so young, and if they start doing this, they're going to look up. They're going to have so much money in 20 years. And part of changing that family tree is, what does this look like to be able to help kids?

All three of you turned out so far. So far. You can use someone out of state. None of you had big accounts in your names, except that your college funds were UTMAs because there was not a 529 back then. And we handed your UTMA to you.

Yes. That was your old college fund because we'd cash flowed the college, and you guys used that for your first houses and stuff. Yes. And that got you going on your wealth stuff. But you didn't have a million dollars in your name when you graduated from college. No, no. But I did. I had a million dollars in my name and then I could do stuff with it if I wanted to. I hear you. I hear you. This show is sponsored by BetterHelp. This is the season for Halloween. It's October. We're wearing costumes and we're wearing masks. If you haven't

started planning your costume yet, get on it. And while you're thinking about it, I want you to be honest. A lot of us hide ourselves. We hide our true selves behind costumes and masks all the time. We do this at work. We do this around our friends. We do this around our families. We even do this when we look at ourselves in the mirror.

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online survey and you'll be matched with a licensed therapist. Plus, you can switch therapist at any time for no additional cost. Take off the costumes and take off the mask with BetterHelp. Visit betterhelp.com slash deloney to get 10% off your first month. That's betterhelp.com slash Deloney. So Rachel Cruz, my co-host today and daughter, has a brand new book out. Comes out April 16th. We're in presale right now. I'm glad for where I am. A new children's book.

It's all about gratitude. The first one was about contentment. If you will teach your kiddos gratitude and contentment, you set them on a real wonderful psychological path, the health of their psychology, the health of their emotions, a wonderful spiritual path, and those two things will lead them to an ability to build wealth because people who are grateful and people who are content have a very high tendency to win with money and life, for that matter. So that's what this is all about. It's not just a little kid's book. There's a game here that we're playing that's a long ball.

So this comes out. Now, you're going to be doing signings in several cities. Are we announcing that yet? I am. I don't have all the details, but signings will be in L.A., Dallas, Phoenix, and Atlanta. So story time. Yeah, so I'm going to do a story time. Yeah, local Barnes & Nobles.

But we'll get you the exact addresses and times. So probably around 1 o'clock signings. And those cities coming up in two weeks. So excited. And Ken Coleman's new book that comes from the Get Clear assessment of his. Almost 100,000 folks have taken the Get Clear assessment. You can get it on our website. But we're putting a book companion piece with it called Find the Work You're Wired to Do that explains the results of and includes the Get Clear assessment. So you'll get a code to take

the assessment, and then this will walk you through what you're learning about yourself to get plugged into the proper career that's not only fulfilling, but it turns out when you love what you do and when you're good at it and you're fulfilling and you're fulfilled at it, you will make the most you've ever made in your life, which is part of the goal here. And so very few people maximize their income doing something they hate and that they suck at. Very few. That's just highly unusual. But that book is also in pre-sale. It comes out technically, and we'll ship it to you first week of May. And so all of those are on sale, and that's what's happening around here right now.

All right. Rachel is with us in Salt Lake City. Hi, Rachel. Welcome to the Ramsey Show. Hi. Hi there. How are you? Good.

How can we help? Yes, sorry. I'm extremely nervous to talk to you. I've been following you for the last four months really heavily after having a sister nonstop in my ear about Dave Ramsey. Listen, anyone with an accent as cool as yours should not be nervous to talk to us. I know. Is it British or Australian?

What am I missing? It's British. It's British. You're're right so where are you from in the uk uh from from paul from dorset oh wow originally but we're actually emigrated two years ago um and i'm going to try and make this it seems like a easy question but it's complicated so i'm going to try and not ramble um we emigrated two years ago because we couldn't do in the UK what we wanted to do here, which was buy land, build. My husband has been in construction for 15 years, and he's really good at it. We raised all the capital.

We came here, and within a month of moving here, I was diagnosed with stage 3 cancer. Oh, my. And all of our money went to keeping me alive. That's about $36, dollars worth of credit card debt i'm calling that a good investment yeah yeah um right but still uh so we're not massively um in that thirty six thousand dollars um of credit card debt um but long story short my husband on top of that his dad passed away very suddenly was healthy and passed very suddenly

last year um and we're about to receive roughly about what we've spent on keeping the alive back in inheritance from his father's estate and we are in my husband is sitting next to me he didn't want to be on speaker because he has an accent too and he didn't think he'd hear him properly um but we we're just uh in a place where we're following his steps and we know we should My husband is sitting next to me. He didn't want to be on speaker because he has an accent too, and he didn't think you'd hear him properly. But we're just in a place where we're following his steps, and we know we should pay the debt off, but we're in disagreement with what that money should do because he knows he can take that, and he can change our lives within 8 to 10 months

by investing what his dad's inheritance will bring and put us straight into out clear with 6 months in the bank, savings, you know, out of debt. Rachel, how much money is this? It's $120,000, but Lan's only about $28,000 here, and he can knock it up real quick. So it's – and we can sell it for $350,000. So the numbers work. He's not just – it's not a pipe dream.

We've done the numbers. We came out with a business plan. We do know what we're doing um but we're so you're going to build something for 128 000 that you can sell for 350 that's correct uh that's right okay obviously less fees there's going to be fees and um but then with the plan is to reinvest it and then go to a piece of land that he can do for on and, you know, to grow from that. That was what we came here to do because we couldn't do that.

Normal builder margins in the United States of America are nowhere near that. These are numbers I've never seen before, and I do a lot of real estate. I understand. We have run the numbers. We've got an estate agent. We've looked at the market. I mean, 350 from the higher side, worst case scenario, it's going to be 300. And my husband's doing the work himself. So he's not having to, obviously, like I said, he's been in construction for 15 years. So he knows how to do ground up. He does everything. And it's qualified just in

about just about everything you can imagine so we're doing this um where my you know we've not got a whole lot of labor cost because my husband is doing this while i'm i'm working um and keeping our bills paid through my job a guy building a house completely by himself he'll have help but it's just not going to cost a lot because he's been laborers because he knows what he's doing. Do you guys have any other savings? Do you guys have any other savings? We don't,

like I said, well, we've got the thousand, we've got the emergency fund. We started our debt snowball as well. So we're into our debt snowball. But like I said, it's,

we're arguing back and forth because I want to clear the debt and then wait. And he's saying it's going to take, he worries if I relapse or anything else goes wrong, we'll never get this opportunity again. He's worried that if we don't do this now. So here's what makes me nervous about it, Rachel, because I mean, I trust you guys. You've run the numbers. You know what you're doing.

It's not a question of that. But whenever you make a decision that is so single focused And the way The language you're using Or the language that he's using That you're telling us It is this urgency It's this If I don't do this now

It's never going to happen again And you can plug in that Rachel That scenario That language With kids going to college I got accepted to this college If I don't go

If I don't go this fall Then this This and this Isn't going to happen Or someone buying a house And they'll tell us It's the the only house. This is the only house we can do. It's our only option. And when you start to do that, Rachel, you start to lose the ability to make decisions because you don't have options. And so what I would say is I would slow down. I really believe you guys know what you're doing. He's very talented. He's really good at what he does. But that's the business side of his world. But what we're talking about here is your personal

home and your personal debt and where you guys are. And this inheritance is coming in. And so I would clear it because the urgency of the other option as well. Usually people don't make great decisions when you're in that position does that make sense yeah this is a fatalistic language um the uh what do you make we make about 110 between us a year okay so why can you not pay off 36 000 in 12 months um because we're paying uh uh we you're gonna hate me. Don't make me tell you. We have our kids in private. We have two children in Christian private school.

And that takes quite a lot. We try public school. And my daughter has autism. And my son has gastroparesis. And the state just wouldn't work with us around that. So we moved them into private school. What do you do for a living? I am a piano and voice teacher,

and my husband obviously owns a construction company. And he's doing construction now. Yes, he is. So he picks up projects and is working, wants to be working for himself. This is what we came to do. Yeah, Rachel, listen, as've had to go back and... Listen, as mom,

all the health stuff that you guys have been through, and then as you just explained with your two kids, I'm like, I would not want risk. I would want everything paid, and I'd want a pile of money in the bank because the amount of situations that can come up for you guys is a lot. So the answer to the question is no.

I would not build a house. That's what I said. I would not build a house. I the house that's what i said i would not build the house i would pay off the debt and i would go if i'm your husband i'm going to start doing renovations and rehabs for other people self-employed because he has the ability to do this he can make a lot more money than he's making now and build that business and build some cash base back up and then go do this other deal um Because I've got to tell you, I've been doing this a long time, and I know a lot about building. I'm building a house right now, and the numbers you're giving me, they don't work.

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They have all the cyber tools and monitoring services you need. They cover all types of ID theft, and they even include up to $2 million in stolen funds protection. In the end, though, you need an ally, someone on your side to take over the work and fix the problem. That's what Zander is all about. Go to Zander.com to learn more or call 800-356-4282. A couple of circlebacks before I get 9,000 comments about how dumb I am with taxes. Because I am, and that would be accurate, but there's no reason to make it worse. So the gift tax is not $17,000.

Even my cheat sheet that was in front of me, because my brain doesn't remember all these things, was wrong. And so it's actually 18,024. So an individual can give an individual $18,000 without any gift tax or income tax. If you give, if an individual gives an individual more than that, or not, not, if you're not a nonprofit, okay, then you're going to, you're going to get gift tax. But I can give an individual 18,000 and then my wife can give an individual 18,000. And so that gets them 36,000. And so with grown children that are married, you can do it four times, you know, father to daughter, father to son-in-law, daughter or mom to daughter, mom to son-in-law, right? And so that creates four checks of $18,000. So that would be $72,000

you can move. So sorry, guys, just don't need to get your hate later. You hate me for a lot of things that I don't even do. That one I actually did. So the other thing is this. I want to continue our conversation just a little bit, just in general. So the last caller rachel you brought up um the most important part on that call which is that when you narrow it down to i've got just one shot yeah and if i miss that one shot on any decision that you're making you are now rationalizing the decision because it is not a fact that you only have one shot so So there's, if I don't get this house, I'm never going to get a house. If I don't buy this car, I'm never going to get a car. God only put one person on the entire planet for me to marry. And if I miss that one,

I'm going to not be married. Bull crap. Okay. Just bad thinking skills skills so anytime that you allow anxiety the stress and strain of life the tragedies of life the fact you've been fighting cancer or anything else to narrow you down to one singular decision rachel's point it was that you're going to make a bad decision yeah yeah yeah and we find that a lot with people because, you know, because money is a tool, you know, in your life that you're using. And when life is hard or life feels out of control or life feels like, oh my gosh, this is this one thing, then you use that tool money to go and- Try to get the control back.

And try to get that control back, yeah. And so there is a patience to slow down and to say, let me gather some more options option a b and c and out of that then you can start making okay maybe maybe the answer still is a for whatever your situation is but at least you've researched and you've thought and you've taken time to look at b and c um because man we just because i don't know we talk to people all the time and it was like we're in a house and we shouldn't have bought it but we just thought it was a really good deal. We didn't think we could find another deal like this, so we got in it, and it turns out it wasn't.

You know, like, and you get in this mindset, and it's just really, it's really dangerous. So, a couple of, bad decisions are one of the primary thing that's things that steal your wealth. So, decision-making principles are important. So decision-making principle number one, if you think there's only one or two things to do, you haven't spent enough time gathering up options. Options are power. Options are informative. Options cause you to really think clearly. And so, um, you know, you know, like the people that call in, they go, well, we've got mold in our house and the only other house that we can live in is $4,000 a month and we make 5,000. So do we buy a house and go bankrupt or do we stay in the

moldy house and kill our children? You know, you have two stupid but options and i'm supposed to choose between these two c none of the above keep looking you haven't figured it out yet you know and so that's the kind of thing we're talking about we get that call actually so that's a call that's come in more than once over the years and so it's just because you justify the crap out of doing something you don't need to do well and fear will do that, too. Did you hear that in your example of mold in the house, which is very real? But also her husband in the last call, he said, what if you relapse? She said that, you know, and there's a level of fear there.

And so facts, John Maloney says, when you're facing trauma, facts are your friends. Yeah. And facts are more and more and more. And that's number plural fact. Number two decision-making principle. Slow down to the extent of the size of the decision. Quit spending all your calories on nothing decisions. Some people spend more time deciding which gum to purchase in the gas station than they do which car to purchase.

You spent your calories on the wrong thing the bigger the decision the more time and then you know i i can't i'm frozen with indecision dentine or eclipse and but i but i impulsed a porsche you know it's like this is the backwards stuff right here you know so the the size of the decision means you need to slow down and have more and more options. And then the length of patience, your pulse rate needs to drop. If you've got house fever, go take a cold shower. Your pulse rate needs to drop. You're about to do something stupid because you can just hear

it you can hear the anxiety in the in people's voices when they call in here with these things and not just her she was she's a sweet girl she was nervous as part of it too no but there's a but there's a high level of emotion then circle back one more thing on her call because i really need to get this out here for her to hear and her husband to hear but also everybody else okay the option of taking your 128,000 and putting it into a spec house, building a house from the ground up on a piece of real estate and flipping it immediately, a spec house of speculation, builder spec house is one option. But let me just tell you, I grew up in the construction business. I've had my real estate

license since I was 18 and I'm older than dirt. So I've been doing this stuff a long, long time. I can tell you for sure that if you have builder skills, you show up on time, you finish the project of renovation or new construction on time, and you build a budget and stick to the budget, you are an unusual animal. You are very, very marketable. Because most people in the construction business can't even show up, much less finish, and their numbers are so screwed that they piss everybody off they're dealing with because they don't show up on time they miss their numbers and they don't

finish on time and so they never get repeat business because they make everybody mad that they're dealing with if you'll just show up on time you you can own the world and finish on time and hit your numbers you can own the world so that young man if he can do the deal he thinks he can do he can do renovations and make three hundred thousand dollars a year yeah he can grow a renovation and new and custom housing business build decks put porches on the back whatever it is he can make a bazillion dollars if he has the skill set that she says he has and i don't doubt it yeah and if he can actually pull off projects yeah show up on time take a bath you know and finish the project on time and hit your

numbers you got no competition because nobody else in that space hardly does it very few do and the ones that do end up being custom home builders for the rich yeah because they're excellent at what they do exactly yeah and so you you got dude you got so much potential out there if you do that that that you i i think you could take that you can take 128 000 minus 36 000 with a credit card debt use that to do some some renovations parlay your way into 300 000 in cash and go do you a couple of these specs later if your numbers are right and i'm wrong because i think your numbers are unrealistic but if i'm wrong about that which i'm happy to be wrong i hope i hope i'm wrong i hope you make a hundred i hope you make make 100% margin on a construction project,

but it's very unusual. It doesn't happen, okay? So if you can do that, then you can do what I'm talking about with what's left over after you pay the credit card debt off, and that's your third option. That's right, that's right. And it's a classic, too, example,

which happens in so many families and so many marriages, is you kind of got your realist and your dreamer, right? Oh, yeah. And it's like, oh, just give me this. Give me this shot. Give me this shot, right? And not that all dreamers are wrong, because sometimes it's right. But also, I would say to him, listen to your wife.

The emotional space in your home, bring the peace. Bring the peace of not owing anyone anything. Bring the peace of having savings in the bank. Like, bring the peace bring the peace of not owing anyone anything bring the peace of having savings in the bank like bring the peace and then and then let's focus on everything else but that let's go grow this construction for yeah for a wife that's been sick and kids that are like all of it i'm like oh yeah the shame i did that i spent the money our family was going to get rich on to save me from cancer and i'm ashamed that's That's ridiculous. I mean, no, no, no, no, no, no, no, no, no, no, no. So, no, your family's going to be fine, even though you had cancer.

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 actual amazing relationships. Rachel Cruz, Ramsey personality, number one best-selling author, host of The Rachel Cruz Show, and co-host of Smart Money Happy Hour, two of the Ramsey Network's more popular podcasts and YouTube shows. Also, my daughter. She's my co-host today. Open phones at 888-825-5225. Tara is with us in Louisville, Kentucky. Hi Tara, welcome to the Ramsey Show. Thank you. You ready for my question? Oh, there you are. You cut out a little bit. Oh, I'm sorry. I'm staying as close to a window as I

can. You're great. Are you ready for the question? We'll try. Okay. We're looking for advice on what we can do for financing for flipping houses. We currently use our home equity line of credit for the purchasing and remodeling, but, of course, that payment gets a little high. So we're just looking for some ideas of what to do. Okay. I've probably done 1,500 or 2,000 flips in my life.

That's what I used to do for a living before I went broke because I borrowed money doing flips. So for 35 years I've taught people not to borrow money as a primary way to lower risk and create wealth. I don't borrow money, and so I'm not going to be able to help you borrow money. Okay. Then what do you, I mean, do you just straight out advise just cash for flipping a house? Yes. Okay. And there's a lot house? Yes. Okay. And here's,

there's a lot of reasons why. Okay. Um, when you use financing to purchase a house that you're going to flip, you're not as careful as when you use money out of your bank account to purchase a house to flip. When you are using financing to do the renovation on the flip, you're not as careful as when you're pulling your stinking hard-earned money out of your checking account to do the renovation, and you end up spending more on the purchase, more on the renovation, thus your margins are lower. Oh, and then when you get ready to sell it and interest rates tick up from three to seven and the market slows down dramatically and you're sitting on this thing with payments you become what's called a motivated seller and you give up

the rest of your margin so your margins are destroyed when you do flips for those three reasons with financing. So I would go a lot slower, buy a lot smaller, buy something seriously junky and tiny and flip it with cash out of your pocket. Use every bit of the profits from that to do that, to upgrade your flip to the next one, upgrade your flip to the next one, upgrade your flip to the next one, and upgrade your organically grow your cash base with profits to increase the quality of the flip that you're doing. Um, because what you are doing causes more people to go broke than it prospers more people, including me. Okay. So I'm, I'm really scared for you because the thing that has to go through your mind when you're doing these deals is that this is all going to work and it never in real estate i've done thousands of transactions it never works exactly the way you thought it was going to yep that's

exactly right and you know tara my husband just even this last year, he's kind of started. He's done three flips. Yeah. And, you know, and we've cash flowed it. And you're right. And he's good at real estate. And he does it. So I can't I can't take any credit. But, yeah, there's like, you know, it's a state sale. There's dead rats in the house. I mean, it's it they're not pretty properties. But then when you go and what you're saying, you make the selections and it's us making the selections out of our own account. You are like, OK, what can we do here, here to save money here?

I mean, you're thinking through everything. We brought the kids out to do the yard work last weekend over Easter to help move some stuff before they went through and like tore out the bushes. And, you know, I mean, you just think about it different. It's just and it's a slower process. It's not as fun and flashy, but there's so much less risk. And if something were to happen, you're okay. You're okay because you don't owe a bank something. You know, like it just goes back to the options

like we talked about in the last hour. I mean, let's pretend there was a Fauci pandemic or something like that. And the market just froze like a deer in the headlights and nobody's leaving their home. And they're cuddled up in the corner with their mask. Well, and what happened with you was that you had so many of those going and you were good at it yeah and because of that you mac you kept building on it and making a bigger bigger risk and then

when i had a million seven in finance flips at 24 years old i owed the bank a million which remind remind everybody because that was that was 1984 decades ago because it bank a million seven remind it remind everybody because that was that was 1984 decades ago because it's a million seven now for some people okay so it would be eight million now okay yeah so i had the equivalent of eight million dollars financed in today's dollars under flips at 24 years old in 1984 is it one way one million seven one million one with one bank and this is how i learned not to borrow money. Yeah. And I had 30% equity positions in almost every one of them.

I was not laid on a single note. So what happened, Dave? What happened to your little house of cards? The bank got sold. Small town bank doing business with me. They knew I knew what I was doing. My family had been in the real estate business. I've got a history, family history of knowing what we're doing. All of a sudden, some bozo in Atlanta instead of Nashville is making a decision. And he looked down and said, a 24 year old owes us a million three. Have we lost our minds as a

bank? Answer? Yes. But, and they called our notes, which they have the right to do with commercial paper. It has a call provision in it if they don't like the quality of collateral, and they suddenly just declared that they didn't like the quality of their collateral anymore, and now I've got to come up with a million three, and I'm 24 years old. It's all tied up in real estate, and I probably got 30,000 bucks in cash because I was a freaking genius and had it all figured out now there's your tiktok deal right there you tiktok morons wanting to flip houses so there you go and so that's exactly what's happening now that, and I spent the next three and a half, two and a half, three years of my life losing everything I own. And so the year Rachel was

born, we ended up filing bankruptcy at the bottom of it, lost every stinking thing. One year I made $250,000 as $20,000 a month in 1984 dollars. The next year, my taxable income was $6,000. I spent the whole year selling stuff to avoid foreclosure or being foreclosed on on the way down into bankruptcy so yeah trauma i'm a trauma survivor so that's it and so dave don't borrow money when the borrower is slave to the lenders in the bible i think god's smart i think god knows something I don't know and I don't borrow money anymore so all that to say Tara I you know the wrong guy no but no you know the right guy if some whoever whoever told you to call over here I think they set you up but um but the uh but yeah I want you

to go do flips I mean my son-in-law does I'm a daughter of husband sitting right here and I taught him how uh you know I taught him a lot, not everything. I taught him how to buy foreclosures and buy real estate. He worked running our Ramsey portfolio for a lot of years and still runs it. But he's, and he's using the formulas right now that we talked about back in those days and he's paying cash. So I'm not against flips, but do it with cash and you make way better decisions all the way across the board, and you don't turn yourself into a motivated seller. And you won't hear any of that on TikTok, I can tell you. This is The Ramsey Show.

Rachel Cruz, Ramsey personality, is my co-host today. Glenda is in Cedar Rapids, Iowa. Hi, Glenda, how are you? I am good. How are you guys? Thank you for accepting my call. Sure. How can we help?

Okay, just to get it out of the way, we are FPU 20s. So just to start that with my question. I just wanted to make sure you knew that. You're a beauty school dropout, huh? Okay. We are, absolutely. Okay, so my question is, we've always heard that you say mobile homes go down in depreciation. They do.

We agree. If you're in debt and you own your mobile home and the land, but not in the ideal living situation, should we sell it to get a house or stay. We have animals, so we can't rent, and we have many, many animals. We take care of my parents, and my dad has dementia, and it's also affecting our marriage of where we're at. I'm sorry, what is affecting your marriage about where you're at? We have family that live out that way.

The family, one, could be next door. There's drug use. So you want to move away because of that, too? Yeah, yeah, absolutely, absolutely. I just don't want to be in that kind of environment. Just making sure I understood how it was affecting you. Yeah, I got it. Yeah, you want to be around people that you want to be like, like you say.

All right. So what kind of animals have you got? Chicken, ducks, dogs, cats, rabbits. And how many acres do you have now? We have close to an acre. One acre. Close to it, yes. But you're just in the country country so you get away with all that

yes yeah yeah yeah these aren't these aren't city these aren't city chickens okay no no no these aren't millennial yuppie chickens okay no they're not the eggs are great yeah all right yes all right so um country chickens so that's good how much could you sell everything for glinda if you sold it what would it bring we're guessing about a hundred thousand with the land and the mobile home together yes because we did what do you owe but it's nothing we own it outright my parents gave us the land we bought the mobile home so sell it and go buy something sell it and go buy something for a hundred grand oh should we do that for a house, though? Because I don't want another mobile home.

No, you're not going to get another mobile home. It kind of defeats the purpose. No, but you could take out a mortgage. It might not be much of a house, but how much other debt have you got? About $50,000. On what? Oh, boy, here we go, Dave. It's averaging $15,000.

My numbers, I don't have exactly with me, but it's about $13,000 on a car, which we're hoping to pay off in the next year. We have about a $17,000 personal loan because I got plastic surgery. I know, don't yell at me. We have about, I'd say about $12,000 in student loan, um, just miscellaneous debt, anything else he's. Okay. Yeah. Okay.

So what I would do is find, go out and start shopping for a, for a very small or, uh, not such good condition home that is stick built, that will go up in value as you fix it up on a piece of ground and you know and try to make a move that way um okay now then the other options are okay because whatever the value of this mobile home is in five years can you and i agree it's going to be way less than it is now oh absolutely okay so you're causing your money to go backwards every day you keep this and you're living next to uh family drug addicts and so there's a lot of reasons to move um but every time we do something there's always uh there's the pain of staying there next to the mess and the pain of staying there with a mobile home going down but the pain

of moving to get your family away from those two things might be no chickens yeah i would be fine getting away from it yeah and so the animals you may be you may have to cut the animals down to a level that you can rent for a little while write a check and pay off everything and uh have a lower animal level and i love animals but you got to make choices in these situations and it's greater in this situation obviously from a financial and just yeah getting away from the mess to be able to say we have peace over here and that may mean eliminating selling off yeah so let's pretend that we could write a prescription for you if we were the doctor okay and here if you go fill this prescription you will be wealthy okay so you sell the place you go rent something with fifty thousand dollars

in the bank and zero debt and you straighten your act up and go back through Financial Peace University, get on a budget, increase your incomes, and let's pile up cash on top of that 50, and two years from now, let's buy a nice place for 150 because you have no payments except a little rent payment. It's going to cost you some animals, and you're going to have a lot of peace in your life because you have zero debt and zero drug use next door. And you're going to be cleaning up you, looking in the mirror, and you're not going to say I'm a dropout anymore. You're going to go back through Financial Peace University,

and I'm going to pay for it. And if you go do all of that stuff, your life is going to be such a completely different place four years from now five years from now than it is now but if you go do one of those things it's not going to work you're going to be right where you are you can't just do part of this you can't take if the if the doctor gives you four prescriptions say i'm just going to take one of them and then gripe because you're still hurting yeah you know i'm still ill my health is still bad so you're going to have to

do the whole thing glinda and if you do that honey you can do it i the lady i'm talking to is not dumb you're smart you can do it you just have not chosen to do it yet so now it's time to choose so hang on we'll help you if you want it if you want financial peace we'll give it to you you go back through it this time be serious like your life depends on it because honey it does the quality of your life depends on you getting your act together and dump that stuff man and let's make the move make it happen boom boom boom boom boom you don't have to be a mess you're choosing to be a hot mess change the change the choices and you can do it you're the kind of lady that can do it you got the stuff i'm amazed what happens when people follow through on all that when they do the whole thing yeah

yep i know and how pitiful the results are when you just do part of it yes but the pain is you're giving up things in the present that you feel like oh my gosh well we need this and that and it's the devil that I know it's that you know it's the mess that I know yep I'm used to my mess and the thing is is that you can get back to part of the life that you're you know sacrificing right now and the things that you love right I mean same with like a car for instance I know car is not an animal but like you know we tell people sell the car you can get that car again one day when you pay for it like it's not like you never get that car again but do it the right way and even like think you know something like the animals it's like yeah maybe for a season you don't have animals but if you really miss that then you work towards a life to get them back and to to be able to say yeah we want that life again and that's the beautiful

thing about it but you're just doing it the right way which the order is really important in that to find the success and to do it well yeah that's exactly right yeah me and you didn't grow up on a farm but your mom did and her emotional attachment to animals is almost zero oh my gosh so um dad because they always leave because you you sell them that's what you do. You're on a farm. That's what you do. And so the need to, you know, so she still does not grasp the idea that our dogs are one of our children. She can't get that. She's just like, you are a weird man.

And so you do love a dog. I do love a dog. I love babies and dogs. I know. That's what a lot of people don't know. Internet. You should know that. Dave can be harsh.

Dave can be harsh, but not to babies but when your dog is yeah you came over when we had to put an all down and dad laid in the floor with our lab and cried before we put her down the night before me you look you really are oversharing you do what is beautiful it's so great he loves he does he loves dogs and babies my grand dog for 10 years i know it. I know. It was terrible. It was a good dog. It was so sad. Oh, losing a dog is terrible. Terrible, terrible. So we want you to be able to get back. We're not animal haters is the point.

Yeah. But sometimes you got to go, nah, 16 cats. Yeah. Something's got to go. Yeah. And that's 15 of them. Yeah. Or 16 in the case of a cat.

But yeah. Not cat people. But I don't know. Maybe we can get there oh here we go the hate the hate's gonna come pouring in i love it this is the ramsey show rachel cruz ramsey personality is my co-host today open phones at 888-825-5225. Kayla is with us in Fort Worth, Texas. Hey, Kayla, welcome to the Ramsey Show. Hi. Thanks for taking my call.

Sure. How can I help? Well, my husband and I were trying to figure out how to increase our income so we can meet our monthly expenses and then also pay debt down. Kind of feel at a loss at the moment. So, um, we're total debt we have is about 37,000. Um, we need about 7,000 a month just to pay, meet our living expenses and then make minimum payments just on card balances right now um my

husband $37,000 yes you don't need $7,000 a month to do that what in the world are your living expenses um so we're just looking at the uh expenses like paying the rent just living all of that and then um paying down debt just the expenses that we have trying to how much how much are the do you know how much the um minimum payments are not not living expenses just the debt payments um the debt payments there are really many more right now so we have um the total credit card debt is $7,000. For those that are like $500 limit, one is $3,000, two are $1,000 limit. And those are about maxed out. Okay.

But how much money do you guys need to keep those current per month? What's the minimum payments on your $37,000 worth of debt equal per month? So for the card payments, it's just $650 a month minimum. Okay. Then we have another $6,700 a month on a larger loan of $21,000. Okay. And then, you know, just living expenses on top of that and the card payments. Okay. Wait a minute.

It was only $28,000. You said you had $37,000 in debt. How much is your car payment? Car payment is $250 a month. We owe nine and it's worth about $10,500. Okay. Okay. All right. So yeah, you're getting up to $17,000. So $2,000 a month covers your minimums and you need $5,000 a month in addition to that to live. $3,000. Yeah. How much is rent? Rent is $2,600. $2,600. Okay. What's your household income? My husband just started

a new job a month and a half ago. It's car sales. He just started last month he made $1,400 total and this month halfway through he's made $1,600 total, and this month, halfway through, he's made $1,600 just in the half month, so he's doubled that at least. And people keep telling him at work that come the third month,

the back-end stuff rolls in and that it should not be hard for him to do about $10,000 a month, and he works hard at it. He's there six days a week at least. How much are you working, Kayla? We have three kids at home five and under and the little bit i do is like 180 a month it's just content writing yeah it's not much so your your your problem is your husband starting a new job and then he make isn't making any money yet not correct that's your real problem yeah Yeah. They're like, we're living on a prayer, waiting until it comes in.

What was he doing before? Last year, he had quit his job of 17 years at Costco. He was working there as a supervisor. He quit the job after two or three years of calculating risks. He took out the 401k that he had built up from that to move here to Fort Worth and to start a business, a photography business that he had wanted to do. And he made sure there was about a year's worth of living expenses from that to live on, but nothing had come from it. So he went out and got a job a couple months ago to make sure, you know,

we can get to the point where we can make the, you know. We didn't have any credit card debt at that point. He paid all of that off. Is all the savings gone? Yes. Yeah. So the bottom line is, Kayla, you're terrified. A little bit.

This is pretty scary. You got little babies at home and no money to eat with. Yeah, pretty much. Yeah. I'm sorry, hon. And he's not a bad guy. He's out there working and trying. Oh, no.

Nobody's throwing him under the bus, but this is a scary situation. Do you have family around Kayla at Fort Worth? No. No, they're actually back on the West Coast where we moved from. Okay. Okay. Are you guys in a good church? Yes.

Good. Yeah, we got connected really good. Good, because you need good community around you while you turn this around. So what we need to say out loud, and he says it with you too, is that I don't really care what the guys at work say. I care what actually happens. And so if he doesn't get his income up very rapidly at the car lot, he's going to be doing something else.

Yeah, and that's a struggle. He was thinking of going back to Costco, but right now, what he just made in this half month so far, that's about the same that he was making before. So it really wouldn't do him any good. And what it may look like too, Kayla, is working nights and weekends and supplementing some of this. Because even the margins of just living and you guys paying rent and eating and supplementing some of this and i mean because even the margins of

just living and you guys paying rent and eating and all of that right regardless of paying off debt just i'm not worried about you paying off debt right now i'm worried about you right so that's what i'm saying is i think that maybe for a transitional period there's probably a reality that he's gonna probably get a second job until, which is the prayer, that this third, fourth month hits with his new job. And then you're able to say, okay, good. Now we have a foundation under us, and this is what we can go for. There's two things that will help you with the level of fear, the terror rising up in your stomach, up into your throat, okay? Thing number one is you need to carefully prioritize the money that you do have.

And I'll do it for you right now. Are you ready? We call it the four walls when you're in a crisis and you're in a crisis. You got to keep the four walls of your house up. And that means first, number one, food. Before you buy anything else, you buy groceries. Not eating out. You guys can't afford to eat out.

Oh, yeah. Before you do anything else, you buy groceries without guilt. It's your primary job before you do anything. The second thing you do is you keep the lights and the water on. Utilities. The third thing you do is you pay the rent okay before you do anything you do those three things and i think you've got enough to pull those off already

yeah okay and that means that means that some of the rest of this may not get paid this month because we made choices that of what was important versus what was less important um and then as we get on down through there i'm going to pay a car payment because i need transportation but mastercard and student loans and protecting my credit are not on the list of things i worry about when I'm in your situation. You're just going to get behind with them. If something has to be behind, choose the right thing to be behind. And that's called unsecured debt.

That's what the right thing is. And it's a bunch of other miscellaneous crap that's in your life that you just go, we just can't do that because we bought food, lights, water, rent, car, food, shelter, transportation, clothing. You probably don't need any clothing. You're probably okay for a while, but you just get by. You just get by. You just get by.

You just get by, and then his income comes up or he changes jobs and his income comes up and we start to make moves on these other things later first catching up on anything that's behind and later doing that but if you'll take care of food shelter clothing transportation and utilities before you do anything else your peace level will increase. I know I was in your situation once. Okay. Then secondly, the thing that goes with that is to budget, and again, that's just on paper, on purpose. Use the EveryDollar app. Work with your husband.

And both of you look at these numbers every night. We have enough for food. We have enough for lights and water. We're going to pay the rent right here.'ll pay the car payment right there and when you're looking at the plan and you're executing the plan and forced ranked order of priority it is going to give you peace a lot more peace than you have right now because right now you've got chaos on top of shortage yeah and kayla stay on the line christian will pick up and we'll give you an EveryDollar premium code so that you can connect this to your checking account and you guys can... Free. Yeah.

And for it to be real time. Yeah. But that's one of the best things that you guys can do. You can stay right on top of it. And you call us again if you need help, hon. This is The Ramsey Show. EveryDollar is our world-class budgeting app that helps you manage money the Ramsey way. It simply works wherever you are, iOS, Android, online.

You can start every dollar for free and immediately see where you stand with your money. Get organized. If you're new to every dollar, we'll show you a long-term financial roadmap, track your net worth, debt-free date, retirement date, baby steps progress, and of course, help you keep up with your money. And we'll coach you along the way. Download the free app for iOS, Android, or go to everydollar.com and get started on the desktop. George and Jade will be hosting a budgeting live stream on YouTube on the 11th of April, and they will be answering the top questions we get around budgeting. How do I started can a budget can i budget and still enjoy life dealing with changes that come up through the

month and how couples can budget together stay tuned for more details if you have budgeting questions that you want answered on that live stream feel free to do so just email them to us at ask at ramsey solutions.com ask at ramsey solutions.com okay so one of the best parts i love hosting with you is the generational difference okay you're like a classic boomer i'm a millennial and the generation below me is gen z okay yeah this i know yes okay okay so this so that we're gonna play a game Dave, try not to make a face. Try not to make a face. I don't play poker for a reason. This came out in CNBC.com.

Oh, brother. In fact, ready? One in four Gen Z taxpayers say that they need a therapist now to deal with the stress of tax filing season. Additionally, 54% filing taxes of Gen Z, they were brought to tears in the past or expect to cry this year over taxes. That's fabulous.

So I got one more. It's trauma. I got one word for you. It's trauma of realizing taxes. And this is something that goes to therapy. I love therapy. I got one word. It's trauma. It's trauma. I got one word for you. Of realizing taxes. And this is something that goes to therapy. I love therapy. I got one word for you. Vote.

Oh my gosh. How do we turn this into that? Well, I mean, where do you think taxes come from? I know. The people you vote for. So try voting for somebody that don't like taxes. Okay, yes. But regardless of party, you pay taxes. okay yes but regardless of party you pay taxes

huh regardless of party you pay taxes oh yeah i know yes i've been doing it a while sure some higher than others but never cried but we haven't hadn't hadn't seen a therapist for it but been doing it a while anyways we read that in a content meeting right before the show and i just thought like oh no we're crying oh no i mean the bar you guys it's so low like so low like the next like the next generation though like seriously if you just go to war and they do suck taxes are not fun oh i don't cry i get angry but you can but you can do this you can do this actually angry okay so for that is it is it as a from a, I'm even scared to ask from a boomer's opinion. From a boomer's perspective. Is it, is it that we haven't prepped every generation for what it looks like from like

a workforce standpoint, the applications of being an adult? Like, is it that the reality hasn't been talked about or taught or you know what do we think that is for real though if one in four gen z said they have to go see a therapist because the amount of stress because a tax filing season you know there's a couple things possibilities there because we've got 1100 folks on our team and the vast majority of the people in this building are gen z it's a lot of young people and millennials. And millennials. Yeah, we have a young team. You know, there's a few Xers and a very few boomers in the building.

And so we've got a crew of these kind of people. And honestly, the people that work here aren't crying or seeing a therapist over their taxes. So I'm calling BS on the survey to start with. Oh, you're going to the source. I think that these two generations have more tough people in them than that survey indicates that that survey says the entire generation's a bunch of wusses and that's just not true that's not my experience

with Gen Z I don't I find I do find and I've said this many times and I said it on Fox last night and it got all the hate people going again but um i was on fox business yesterday afternoon and so um but the millennials got trashed for being participation trophy living in their mother's basement all that crap being you know avocado taste toast latte drinking you know all that crap um and then some of that same kind of stuff is coming on to gen z and i i am not a uh a hater of those two generations because my personal experience inside this building with the ones we have hired is quite different i i and i and once they call here on the air yeah they call on the air they're very mature very serious very focused very missional uh now i do i have observed on those two generations

in particular that um there's very little middle ground they don't hang out in the middle uh they're either very serious very missional uh mature beyond their years charge the gates of hell with a water pistol or they absolutely suck they're just horrible participation trophy live in their mother's basement useless entitled arrogant brats and so that they're either the the best or they're the worst the ones that i that we were and they're great to interview because they'll just come into the interview and go you owe me and i'm like i owe you where the front door is hit it and it the interview's over or they come in and go give me put me in coach i'll charge the gates i want to

do i want to do work that matters and ramsey does work that matters and i want to be part of this team and they're really easy to interview because boomers come in and they lie they fake it they act like they're one they act like they think you want they know they don't care they care so much much what you think that they they put on the chameleon you know it's a it's a donkey dressed up like a thoroughbred yeah yeah and they they make you think but the gen z they don't give a crap what you think. They just is what they is. I love them. I think they're awesome. Yeah, yeah.

And so I don't believe that number. I don't think that three out of four, 75% of the Gen Z are so wussified that they're sitting on the floor sucking their thumb, crying over their taxes. I think that's CNBC bull crap. Okay. Well, there you go. I'm calling it. I just don't observe.

Do you observe that with those generations that are that weak? No, but I do you observe that with those generations that week it's not a weakness it is i do think that the i do think that like your generation uh and and and older there there was more of a mentality of like you pull yourself up by your bootstraps you get to work you shut up you do the thing and you just you go go go where the pendulum i think has swung so far in actually tapping into some level of emotional awareness and comfortable with like okay what's really going on you know trauma in my past I will go I seek help like people you know what I mean like that that's applauded right so there's more of that which I think yeah that's different than I'm crying for doing I know I was gonna say some people see it as weakness not necessarily but I do think that

the emotional state crying for doing your taxes is straight know, I was going to say, some people see it as weakness, not necessarily, but I do think that the emotional state can... Now, crying for doing your taxes is straight up weakness. That's just wushed. But I do think that the emotional space, right, like even parenting. I'm a young parent and so like, you hear the extremes of parenting and it's like, oh, well, are you sad about wearing a coat

to school today? Tell me about your... And it's this whole thing where you're like, you just gotta wear a coat. Put the coat on. I do think that there is a level of um where the emotions can drive a lot of things in life more so than the boomer generation if you wanted to if you wanted to buy into some of the rhetoric on the stereotypes which i'm not sure i do i just did a good job of defending the generation i think yeah yeah um yeah. I didn't think CNBC. The thing that has been thrown at them that could be true is they've never really had a hard time, so they're not tough. Yes, I would say that's fair.

Well, and technology. Ken Coleman's done a lot of preaching and ranting lately about teach your kids to do hard things. Let them get a callus. Teach your kids to do hard things. Let them get a callus. Teach your kids to do hard things. And don't be the bulldozer parent where you pave the way so everything's easy. And that is what happens. Followed by a helicopter.

Yeah, a helicopter followed by a bulldozer. Whatever it is, yeah. Because helicopters, we are sure now, create snowflakes. We're positive. And I think it's more the bulldozing parents that clear the way so there is no hard they don't yeah they don't have any level of it yeah that we as parents we love our children we want to make life good for them but by not allowing them not making not putting them in situations where they learn to do hard things they're not tough and because like you got to be

a little tough sometimes and gen z is the first generation where these smartphones, like my generation, we at least had flip phones. Like, I remember flip phones. Like, the technology progressed, but I do wonder, too, with that. But anyways. Oh, I'm sure screens are at the heart of most evil. I do wonder. No question.

Social media. Anyways. Oh, well, that was good. It's an interesting discussion. So, hey, I get to take up. But I like that you were like, I don't believe. I don't believe CNBC's survey. I don't believe that.

What's up? I mean, have we got the only 700 of them in the nation that are tough? I mean, you know, really, I don't believe that. I mean, the people you and I work with every day are not any of that. They're great. No. They're great. Yes, yes.

Love them. 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 actual amazing relationships. Open phones this hour, Rachel Cruz, Ramsey personality, co-host of the ever-popular Smart Money Happy Hour, and my daughter, number one best-selling author.

She's my co-host. The phone number is 888-825-5225. And Maria is next. Maria is in Reno. Hi, Maria. How are you? Hi. How are you?

Better than we deserve. What's up? Well, first of all, it's a privilege to be able to ask this question because my husband and i have been following um your baby steps and we did financial peace before we got married so um now we're stuck though because we went off script so we started because you're stuck because what we went off script we were following all your baby steps and then we kind of just went and there's no you fell off the proverbial wagon. Okay.

So I'm hoping it wasn't a stupid decision. But anyways, it was good intentions. So we saved the 20% for a down payment. And at that time, just with family circumstances, we thought we would offer for my mom to come and find property with us with two homes and whatnot and kind of get her out of her situation. And there was a variety of reasons that played into that. But just, you know, she could get out of debt, whatnot, pay for a house that she could live

in without making payments and then be able to work and save for her retirement and whatnot. So your mom and you went and bought a house together? So what we did was we found property with two homes but it is one parcel uh but there's two homes on it and they both were fixer uppers um still are we're working on them but at least where we're at the dilemma at this point is um how do we legally kind of sort all this out? Because we bought it. It was kind of like green lights all the way.

And we did counsel before we bought with a lawyer friend and some other friends of like, is this, can we make this work like legally? How does, you know, how will this all go down? And they're like, yeah, we can sort it all out. So we felt like we had green lights and then we found this property and whatnot. But we went in, went went in 25 percent

of the purchase price we went in 75 percent um we're all on title but now we're just trying to figure out how to legally kind of sort this out what's going in whose trust how do we really figure out percentage of ownership like ideally she feels like for her retirement consideration she should keep a stake in real estate um the advice my husband and i've received was buy her out and get her off title it would be much simpler um and so we're kind of just like scratching our heads it seems simple and like, positive, like we could figure this out going in, and now it just kind of seems muddy to us. So what you're saying is the counsel that you received sucked.

Well, it sounded. Uh-huh, it did. Whoever this lawyer is, you're going to need to stay away from him. He's stupid. Yeah, we'll figure it out later. That's a dumb butt plan okay um because you got yourself in a pinch now you know it's a mess you got a mess you got a relational mess you got a legal mess and you got a real estate mess and you got two houses under construction yes we do this

is chaos and stress everywhere around it oh Oh, my Lord, what a mess. Yeah, buy her out. That's the cleanest. Okay, so, but if you were her or if you were giving her advice, I guess it's like... I would take the money and go buy me something. Like you would leave? Yeah. Essentially? Yeah.

Okay. Just long-term considerations? Yeah. Okay. Just long-term considerations? Yeah. Because she's in a mess with her daughter. It's a mess. What's a mess? Who wants to be in a mess? It's a mess.

I know. It ain't going to clean up either. The only possible thing you can do, and I have no idea if you can pull this off in Reno, California or not, but check with the city and see if you can subdivide the parcel Reno, California or not, but, uh, check with the city and see if you can subdivide the parcel and run a lot line between them, have two parcels. And then, um, you could just deed her, her half and she owns it. Okay. And that way you lost some money, but you kind of deserve to. No, I mean mean that is kind of why like let's let's figure this out now because if we have some sunk costs we need to just swallow it and move on but exactly

exactly okay yeah i'm serious i mean i don't want to hurt your mom and you don't want to hurt your mom and you know if if you want if you buy her out and you let her stay there you're going to have to have some clear family relational boundaries as to what the, you know, you're just going to let her live there free the rest of her life? What's the plan? That's part of the buyout? I mean, you've got to lay out the terms of the buyout.

See, what you all didn't do is you violated the begin with the end in mind principle. And that means you have to write out everything and every possible negative scenario ahead of time and have exit strategies on everything before you do the deal now instead you're trying to unring the bell yeah and it's very difficult to do that and so without without without a tearing without people being hurt and you know, because everybody in the whole thing has got a bunch of different expectations, right? Yeah, what's her, what is she thinking in office? Is she concerned or is it more you guys are concerned on your end?

Honestly, in the threesome, it's probably just me because I'm more of a long-term thinker. Yeah. They're all more like, we can figure this out. When? Well, I'm wanting it done now like can we all these people that keep saying we can figure this out when is it they're going to do it since they didn't do it beforehand right now i hear you i mean we're on i'm on the call right yeah i'm not i'm not i'm not i mean i'm not picking on you. I'm just saying the decision overall, you're aware before you called, is a mess. And she's willing to do, I think she needs to take time to look into, like, just retirement planning in general.

Yeah. But her first thought was, like, I need to keep a stake in real estate. But that wasn't, like, our thought going into it that that was going to be her thought. Yeah. So I would either subdivide the property and give her the half she lives on and you have to get on with most cities and municipalities you go before the zoning board and they approve a parcel a change in parcel one parcel into two dividing it and it'll have to do with the zoning in the area. Typically, you know, you're allowed to have so many square feet for a single family in that particular zone.

It's an R5, an R2, or whatever, residential, whatever. And so then the zoning board will tell you, you have a surveyor come out, survey, draw a new lot line between the two houses. And with setbacks and everything, and it's all set up with the city and approved, boom, then you deed it over to her. If that is not possible in the zoning situation you're sitting in, then I'd probably sell the whole property or buy her out, one of the two. Because what you've got now is not going to end well, hon. You can smell it in the air, and that's why you're calling. I'm sorry. I'm sorry you got yourself into this, but do please clean it up.

This is The Ramsey Show. Our event season is in full swing. We've got three big events on the books right now. The first one is our big dog, the Total Money Makeover weekend here on the Ramsey campus, May 10th and 11th, Friday evening and all day Saturday. It's a weekend-long event, and we're going to have everybody speaking. Rachel, of course, will be talking. I'll be talking.

George Camel, Jade. Ken is going to be talking about how to increase your income. Dr. Deloney about how to increase your peace. Who am I leaving out? Somebody. So everybody's going to be there, all the Ramsey personalities. And when you leave you will have a detailed plan on not just getting out of debt but becoming wealthy and we will have

convinced your friend that thinks you're crazy and when they leave after coming with you for the weekend they will also be crazy just like you so you're going to be it'll be right on track it's a two-day event it's the ultimate motivator to get fired up and to live the life you've always wanted. We're in Nashville, May 10th and 11th. Great to visit this town anyway. And it is going to be a fabulous, fabulous weekend. It is approaching a sellout. It's not sold out, but you can still get tickets. So you better get them now because it's only about a month away, right? So, ramsaysolutions.com slash events. And then a week and a half later, I'm going to be doing a two-night event. George is going to help me, called Dave Ramsey's Investing Essentials, where we go into the basics of investing,

but we also are going to go beyond and do something I've never done and open my personal playbook on what I do with my personal investments. And that includes a detailed look on the second night on real estate. I own several hundred million dollars worth of real estate. How did I do that? And how do I select real estate? What do I do? What's the process? This is not a TikTok seminar by some guy who wished he did it once.

I've done it a bunch. It's my favorite thing, as a matter of fact. So come on and join us. We'd love to have you. It's my favorite thing, as a matter of fact. So come on and join us. We'd love to have you. It's a virtual event. You can get your tickets again at ramseysolutions.com slash events. And then you guys are doing this fabulous event. It's May 20th.

I'm sorry. It's October 24th through the 26th, a true weekend-long event. It's a big event. Marriage and Money Getaway here on campus at the Ramsey Event Center. Dr. John Deloney and Rachel Cruz. And this event, man, last year, people were completely changed. Yeah, it was amazing. Marriages were saved.

It's amazing. When you come, and I think with the mindset of like, it's a getaway, right? You leave your kids, you come as a couple to a fun city like Nashville. And just just you know in the mindset too of like we want to grow we want to be stretched we want to learn and so all that together and we have fun john and i it's a fun weekend you and john are funny that's for sure and our spouses came last year and did a panel so you never know that'll happen again i know yeah that's right so yeah it's a really listen i'll tell you the truth now it's a it's a really fun weekend and we Winston will tell you the truth now. It's a really fun weekend. And we sold out of like the top tier at the event last year.

Like it sold out before. So it's been a quick seller. So make sure to get your tickets. Yeah, there's hardly any left on it. And it's in October. So RamseySolutions.com slash events for all three of those. And I'm very proud to present all of those to you. Today's question comes from Grace in Colorado. She says, I'm a stay-at-home mom with two small children. And I'm very proud to present all of those to you. Today's question comes from Grace in Colorado.

She says, I'm a stay-at-home mom with two small children and I'm six months pregnant. My husband died suddenly last week. He handled all the finances. I lost touch with it when I got busy with the kids. I don't know if there's a will or life insurance. I don't know the password of his computer. Can you direct me to a checklist of how to get through this i want to check the boxes but i need guidance so i'm not googling what to do every night goodness man

oh grace so i assume james that we have uh grace's contact information of course because it's obviously not a uh a radio answer for something this tragic and in-depth. So what we will do, Grace, is we're going to hook you up with one of our Ramsey counselors, coaches that's been through our training. We're going to pay for it. It won't cost you a dime. They're going to meet with you and hold your hand and walk you through every bit of this. And they'll also connect you with SmartVestor Pro,

who can help guide you through the insurance issues and if there's any investing to be done when all the smoke clears, so to speak, yeah, then we can figure out what we're doing here. But there's ways to discuss. There's a database you can tap into to find out if life insurance exists. There's not to find out about a will.

But, you know, the coach will even help you get with a computer specialist and see if we can get the stinking computer open. So I'm so sorry, honey. What a horrible, horrible place to be left in. But you've got friends here, and we will walk with you we are mandated by the book we believe in to take care of widows and orphans and um we will we will you can count on that so um stick but for people listening like when it's when it's a situation like this though for real what's the, like, to even begin?

Because in my head, I'm like, yeah, you go down to, like, an IT, you know, company and get your computer. First thing we try to do is get the computer open. Yeah. And hopefully that helps you find a will if there is one. And find any receipts. A life insurance professional can help you with the database. I can't remember the name of it off the top of my head, but there's a search you can do, and it costs like $5 or something. To be able to go in and look. Yeah, and see if there's anything showing up on life insurance.

Obviously, if there's any file drawers or any hard paper areas, you go through those and try to find wills and life insurance. Receipts or anything. Depending on the assets and the debt and so forth, you may need to contact an attorney and do a probate. You may not. You may not have left anything. Obviously, we've got to start taking the primary thing I hear right here is I've got to figure out how you're going to eat and feed children. A pregnant lady is going to feed two small kids next week because I have no idea where

money's coming from at this point. I need to assess how much money we've got, where we've got it where how we can create some money contact local church to come around you make sure you got food um you know we've got to do all these things and and just put our arms around you and love you well so um there's so many things here um and if there is family a lot of these situations you end up just selling and going with family you you know, being with family for a season. For a temporary, as a safety net. Yeah, for a season. Not as a permanent thing, but as a safety net to get on your feet after this. But yeah, Googling, Google probably can't help you, hon.

I don't think Mr. Google is going to send much love your way. So what this does illustrate, though, is why it's so important for couples to handle their money together. Why it's so important to have a will with a central location where everyone knows where it is in the same place. Um, we call it a legacy drawer at our house. I've got a file drawer.

That's got all the wills and the trusts and the, uh, life insurance and the car titles and the, uh the life insurance and the car titles and the so forth. All of my passcodes are in a system on my computer. And three family members, three people know where it is, and they can all open it if something happens to me. So Sharon's not trapped out and all the different nine million. We've all got passwords to everything in the world. And so you've got to be able to access every bit of that and so and it's even small things of you know what bills are automated which ones are

you paying directly you know what i mean like that's why you need to be involved in the process together you should always be handling your money together and so um i've got a friend in his 70s that just passed and i'm walking with his wife one of our best friends for some 40 or 50 years now. We've been friends. And, you know, she's a very, very smart woman but was not very involved in the day-to-day. And so she's having to learn how to do all of that at 70 years old now. Yeah. And so, um, you, you got to, it's, you know,

it's the only way that, that it, it minimum, it, it, you know, it's having life insurance, having a will,

having a game plan, working together is how you say, I love you. Not participating together is not how you say, I love you. That's not, that's not right. And so it leaves people in the situation, this poor lady here.

And I understand. I mean, she's pregnant, got two little babies. She didn't have time to mess with it. She couldn't breathe. She got, you know, the littles take everything out of you when you've got a situation like that. But still, it leaves you so vulnerable, and it's just sad. So we'll be with you, darling.

And you guys out there can know that, uh, Ramsey takes care of these situations when we run across them. That's for sure. A hundred percent of the time we have for 35 years of doing this. And we will continue to do that. And, um, uh,

yeah. Widows and orphans. This is the ramsey show rachel cruz ramsey personality is my co-host today hey there's always uh not always most days there's 50 to 200 folks out here watching the show in the lobby of ramsey solutions we do this show from one to four central Time, Monday through Friday. There's two Ramsey personalities, usually I'm one of them if I'm in town, sitting here and answering your questions for three hours. We do a three-hour talk radio show that turns into a YouTube show, turns into a podcast, all of these kinds of things. And we invite you to come in and hang

out with us. It's a completely free experience if you're visiting the Nashville area. We're just south of Nashville in a wonderful little town called Franklin, Tennessee, and a little Civil War town, classic southern square, the whole bit. And you can check it out if you're here checking out Nashville or something and come by. Cookies, homemade cookies are free. When you walk in, you smell Mama's Kitchen, and the coffee is free, and the entertainment is questionable. So come in and hang out with us in the lobby. We'd love to have you anytime here at Ramsey Solutions. We built this lobby for that experience when we built this building.

It's designed for that. And part of it is the debt-free stage. And on the debt-free stage is Ms. Katie. Hi, Katie. How are you? Good. How are you? Better than I deserve.

Where do you live? I live in Dallas, Texas. Very fun. and how much debt have you paid off katie eighty thousand six hundred and thirteen dollars and 54 cents i love it and how long did that take you just under 12 months whoa and your range of income during that time um i started out making $29,000, a little more. And then this year it shot up to $113,600. Wow. What do you do for a living? I'm a registered nurse.

So you've been working a lot. A lot. A lot. Did you just get out of nursing school? Yes. Okay. That's what started this whole thing. Yeah.

My debt was entirely just a student loan from a one-year nursing program oh my gosh and you paid off in one year in one year you did it so you you have lived on beans and rice exactly these numbers are i mean like you're the coupon queen you're have no life all you did was work and pay debt i know i'd go bother people for their shifts or part of their shifts my favorite was the 3 a.m to 7 a.m because you got your overtime you got weekend pay you got the bonus pay it was awesome working around the clock what kind of nurse are you i am a pediatric emergency room nurse oh wow well thank you from a mom of three littles yeah good for you what rewarding work too pretty awesome and sometimes terrifying but yeah yeah but yeah wow look at you so what happened a year ago when you got out of nursing school i mean you got why'd you get so

fired up and how'd you get in touch with this ramsey stuff um, I was crazy and decided that was my second college degree. My first one, my parents paid for shout out. Um, and then I just wanted to be a nurse and I wanted to be a nurse as fast as possible. And that required taking out a little bit of money. And then after I finished nursing school, um, I was introduced by my boyfriend, Kyle. He would just start playing the podcast like when we'd be in the car. It was super like low key. Like it was never like, hey, I think you should do this. It was, oh, hey, we're going to listen to the background music.

And then I got kind of interested. And then it became my like guilty pleasure after work. I'd go home and sit in my bed after working night shift. And I'd put on the show before and I'd work from home and I worked from home job. So you had two jobs. Oh yeah. Tons. I did everything under the moon. Like I was, I was ready to work. Um, I knew nursing school, like as hard as everyone says it was, I was ready to work harder when I got out. And, um, I think the idea of, oh my God, I just took out all this money and I was ready to work harder when I got out and um I think the idea of oh my god I just took out all this money and I'm gonna have this payment for 20 years was so scary so very nice good for you what was the most lucrative side hustle you did um I was a big instacart girl okay that was

it was really awesome we live um a little bit north of the Highland Park area, and there's lots of people who like their groceries delivered there. And you were there. Katie helped. But the best thing of all, pay-wise, was the 3 a.m. to 7 a.m. overtime, triple time, all that stuff, right? Oh, yeah. I'd work four, five, six days in a row.

At one point, my manager was like, are you okay? Slow down. Good for you, Katie. I don't work this much. four, five, six days in a row. Like at one point my manager was like, are you okay? Slow down. Good for you, Katie. Like don't work this much. I'm like. I love it. Way to go.

How's it feel to be free? It's crazy. I would let my paycheck hit my account. I'd take care of just my basic four walls. I lived like I still was in college. I didn't buy anything. Didn't really do anything. And then that same day, I drained my account to Sallie Mae.

And a big old chunk would go down every week, every month. It was crazy. And then all of a sudden, we got to the end, and I was like, what do I do with all this money? Can I stop working as hard now? Yeah, that's right. That's right. Good for you. Okay. So what was the hardest part? Cause I'm like, that's a full year, 12 months of just doing this. I think the hardest part was watching everyone else. Um, just a lot of my friends at work would buy new cars or people would come in with, um, new things. They'd go out and I was like, Oh, like that'd be really fun. But like,

that's not for me. Like it's hard. Yeah. Not yet. Um, it was hard. I think really just the hardest part was, um, kind of watching the world go on while you're stuck in it. So was that harder at the beginning or the end? I'd say probably about the middle because I was like going. Beginning you're all fired up. Yeah, I was ready. And end you can see the light. Yeah. But in the middle it's like I'm stuck.

Yeah. Yeah. And it was like summerish and everybody was doing all these fun things. And I was like, I got to go pick up another shift. I got to go deliver some groceries. I got to keep on my track okay so would you tell people Katie because a lot of people you know their their journey of getting out of debt looks so different right and someone listening that's thinking okay I want to dive in I want to do this would you recommend if they have the ability like you just go full force short amount of time all the pain

but it's short or like you could spread this out for 24 months and it's less pain but it's going to take a little bit longer um i've always been like a super go-getter so i mean as long as you mark a clear finish line guns blazing like go she's a rip the band-aid off girl yeah we don't we don't yeah you don't want her being your nurse if there's a band-aid involved yeah it's like pop yeah oh sorry about that yeah we're done it's pretty true that's so great i love it who was your biggest cheerleaders um my biggest cheerleader by far was my boyfriend kyle where is he is he here he's over here oh there you are hi kyle hi kyle she's great we love katie and then all my family that's here oh you brought your family too

they're all super proud of you too then very good anybody tell you you're crazy while you're doing it most of the nurses i know well you're it's kind of a stark contrast for them to have to stand next to you. Yeah. They're going, I'm standing neck deep in my stupid and doing nothing about it, and this girl's cleaning it up. It's a little bit shaming just having you around. You're amazing. You are a warrior princess.

And you're making like $113,000. I mean, I guess that's with some of the side hustles. So you did some of that. But as a nurse, I'm like, you're going to make great money. No payments. There's lots of money if you want to go after it. That's right. That's right.

Good for you, Katie. How old are you? 25. Oh my gosh. I did it. My goal was my 25th birthday and I was like 10 days early. Wow. Awesome.

Congratulations. So great. Hey, you're a hero. We're proud of you. Well done, kiddo. Very, very, very well done. You're a hero we're proud of you well done kiddo very very very well done you're a warrior princess that's pretty amazing good stuff man good stuff don't get in this girl's way wow wow now just get after it get it she's a living proof my granny's saying's true there's a great place to go when you're broke to work oh my gosh wow fabulously done all right it's katie from dallas

81 000 paid off in 12 months starting at 29 when she got out of school all the way to 113 and the secret sauce work count it down oh we've got a couple of every dollar coupons for you to give you a one-year subscription and you can give one away to a friend. One of those nurses needs a subscription. There we go. Count it down. Let's hear your debt-free scream. All right.

Three, two, one. I'm debt-free! Yeah! Woo-hoo! This is how it's done, boys and girls. I love it. Yes. Yes.

The family is cheering around right now. I know. Look at them. So fun. Oh, my gosh. That's so great. This is the Ramsey Show. Our scripture of the day, 1 John 5.14.

This is the confidence we have in approaching God, that if we ask anything according to his will, he hears us. Vince Lombardi said, confidence is contagious. So is lack of confidence. Laura is with us in St. Louis. Hi, Laura. Welcome to the Ramsey Show. Hi, y'all.

Thank you for taking my call. I'll just get straight to my question. So we just found out that our tax person has done our taxes incorrectly the past three years. So we owe back taxes. We are on baby step two, so we don't have a ton of money. And we are debating on whether or not we should take out a personal loan to cover this or if we should set up a payment plan with the IRS. Take out a personal loan to cover this, or if we should set up a payment plan with the IRS. Take out a personal loan.

Okay. The worst creditor on the planet is the IRS. They have almost unlimited power. They misuse it and abuse it. They charge the highest penalties and the highest interest. They're not bankruptable. Personal loans are none of those. Okay.

All right. That's what I figured you'd say. I just wanted to make sure. Can I ask you a follow-up question? Yeah, let me ask one. How the crap did you not know your taxes were screwed up for three years? So my husband is a pastor, and we assumed they were doing his taxes correctly because they're different,

and we just assumed they knew what they were doing and but how did you find it they discovered it that we had said something about um uh his portion of the taxes this year we had said it the first year and they must have missed it and i'm yeah i don't know it is is a cluster. Yeah, wow. Wow, okay, so you think you've got it solved, or do you need a new tax person? No, I think they've got it figured out. Yeah, I hope so. Yeah, we're looking at about $18,000, I think, in back taxes.

That's enough to make me get somebody new. I was about to say, get a second opinion, Laura, too. It'd be worth it to pay somebody else just to make sure all your bases are covered. Yeah, well, the benefit of them was they were free. And worth every dime. And they were worth every penny. Oh, man. Oh, gosh, no. They're the nicest people, though.

A lot of stupid people are. It happens. Yeah. Okay. My follow-up question, though. Should we go to our bank? Let me tell you what's even worse. They go to your church.

Yeah. Yeah. Okay. Yeah, that's even worse. Yeah. Get a new tax person. Okay. Anyway, how can I help?

What's the other question? Should we go through our bank? We have a U.S. bank that we bank with. Should we go through a credit union instead or through our bank? What would be better, do you think? Credit union. In general, they're more human. Now, a small town

local bank is fine, but a credit union versus a big bank. We don't ever recommend anyone do business with the mega banks. The Bank of America is the fifth fifth thirds they have no soul and your credit union's got a soul your small town local bank's got a soul um yes they're bankers but but they they you know there's a human element to them they're you're not just a number where you're like you are with these other banks when does the point with irs debt would you say to go take out a personal loan versus just trying to pay it off always unless you can write a check right now and pay it you got it i would not have irs debt versus personal debt yeah always

because they're just they're unpredictable too because they they're incompetent and so they're liable to do something they're not supposed to do, like go just clean out their account or something. Yeah. Yeah. And they don't usually do that, but I've run into it over the years. So and they have and there's nothing that you don't have any recourse because they're just they have unlimited power. Mm hmm. Every other debt has to sue you before they start taking stuff. The IRS just shows up and starts taking stuff. And so it's just it's brutal.

Yeah. And then on the other side of it, they vote me a refund for four years. I can't get out of them. I'm going to have to go before Congress to get my refund. So it's unbelievable. And it's not a refund because I overpaid. It's a refund because the law changed and we adjusted our taxes. And then they're just sitting on it under the Biden administration administration we got all our refunds under the trump administration on the same thing but the biden bunch is just sitting on it over there um and it's yeah okay all right tracy's with us in new york city hi tracy how are you good thank you thank you so very much for taking my call. Sure. How can I help? I'm 51 years old, and unfortunately, I just heard about y'all like a week ago through a friend, and she told me to give y'all a call. I need help with my retirement.

I only have $100,000 in there, and my job, they doesn't match. They don't do matching. Okay. What do you make? $103,000. But I take care of a sibling who's bipolar and deals with a lot of issues. Mm-hmm. Do you have debt, Tracy?

Yes. How much debt do you have? Oh, I'm sorry. The only debt that I have is my condo and I owe 200,000. Okay. Originally when I got it, the interest rate was like 4.89, but I was able to refinance it when the rates went down. So my rate now is two, two something. So instead of lowering my payment, I just kept it at the same payment that I was paying. Gotcha. Yeah. I mean, at this point, Tracy, I would be funding 15% of your income into retirement. I would get to a point where I'm throwing as much as I can to get this

condo paid off. So you have paid for real estate, you're still funding. And I mean, you have $100,000. I mean, you have a really great start some people that call in have nothing except for retirement so at least there's something there and then who and you said it's a sibling that you take care of yes and how old are they he's 32 32 does he live with you no that did not work out very well yes yeah i would assume so yeah so rachel's right what we teach is a process called the baby steps you need an emergency fund of three to six months of expenses since you're debt-free other than the house then you need to be putting 15 of your income fifteen thousand dollars a year sixteen thousand dollars

a year into your retirement plan, getting all the match. It should be in Roth if it can be. If you max out your 401k at work, which you shouldn't be doing, but if you do and you need to do more, you can do a Roth with one of our SmartVestor Pros, but you need to get to $16,000 a year. Everything else beyond $16,000 a year that you have left in your budget should go to pay off your condo early okay as quick as you get the condo paid off i want you to max out all retirement because our goal here is sometime in the next 15 years when you're 66 i want the condo paid off and a huge pile of money in your nest egg oh okay i think you're going to be a millionaire.

Oh, I hope so. I think you are. If you will do what I just told you to do, I think you're going to be a millionaire. Yes. Okay, awesome. Thank you. Thank you so much. You're very smart, and you're very kind to take care of the sibling the way you are.

Good work. Very good work. And it's just a reminder for the rest of you out there, Rachel, that it is amazing that as we studied 10,000 millionaires, we found that the typical millionaire out of the 10,000, which is almost all of them, like 80-something percent fell in this category. They had funded their 401ks and their Roths steadily in good growth stock mutual funds and they paid off their house and so a very typical scenario would be we'd have a six hundred seven hundred thousand dollar paid for house and you'd have a six or seven or an eight hundred thousand dollar nest egg that was built and that's where exactly where she's going to be yeah and you know then so if you put you know like seven and eight together you've got 1.5 million dollar net worth and so 700,000 paid for house and a 800,000

artistic and that's that's about where she's headed uh with the number she just gave us yeah and her company didn't match and so our the 15 percent even if your company does match does not include the employer's match yeah so it's 15 of your money of your money that's a valid point very good but my but the big deal is is that you can do it that that's everybody says oh well you know the economy and the the biden and the and the trump and the and the the world and it's just bad and capitalism's evil and we need anarchy and socialism and communism like my college professor taught me and all this bull crap out there and you know the truth is the little man is getting ahead at a faster rate a better rate in the united states of america than at any country

in any culture in any time in the history of man you have a better opportunity today than you've ever had so stop your whining and go do it get after it that puts us our the ramsey show in the books we'll be back with you before you know it in the meantime remember there's ultimately only one way to financial peace and that's to daily with the prince of Peace, Christ Jesus. Hey guys, I'm Rachel. And I'm George. And you've probably heard our voices before on The Ramsey Show. And do we have a surprise for you. Yep, we have our very own show, Smart Money Happy Hour,

where we talk about pop culture, current events, and of course, money. George, it's a great show. And what else do we talk about? So much, Rachel. Not enough. And yet too much. We talk about guilt tipping because tipping is out of control and I won't stand for it anymore, which is why I'm sitting. I'm glad you're taking such a stand. And we also talk about something else I'm passionate about, Disney adults.

Oh, George. Why is it a thing? Listen, some adults still find the magic. Sure. We also talk about toxic money traits and girl math. And if you don't know what those are, you have to listen to the podcast. Yeah, there's a lot there, you guys. It's pretty fun. We keep you relevant is what I'm trying to say.

We help you out. So pull up a chair to the happy hour you wish your friends were having. We promise you won't regret it. And if you don't have friends, we'll be your friends. We will. We're great friends. So make sure to check it out on Apple, Spotify, YouTube, or the Ramsey Network app.