The Ramsey Show - THIS Is How You Become A Millionaire In America Today

Episode Date: May 15, 2024

💵 Sign-up for EveryDollar today - The simplest way to budget for your life! Dave Ramsey & Rachel Cruze answer your questions and discuss: "Should I improve the property that I'm renting from my family?" "Should I wait for my ex to pay off debt in my name that he was court ordered to pay?" How to know if you should keep repairing a vehicle or if it's time to upgrade "How do I use EveryDollar with irregular income?" A caller that finds out on air that he's finally a millionaire "My boss hasn't paid me the last three pay checks but I'm concerned the company will go under if I leave" "I have $360k in debt, just found out I'm having a baby, and I don't know what to do" Rabbi Daniel Lapin joins to discuss his new book, The Holistic You "I'm restarting my life after a divorce - can I afford to put 10% down on a house?" Support Our Sponsors: Christian Healthcare Ministries Yrefy Zander Insurance Next Steps 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 📈 Dave Ramsey's personal playbook on investing and real estate. 📘 Beat debt and build wealth with the new The Total Money Makeover Updated and Expanded 20th Anniversary Edition! 💰 Enter the $3,000 Ramsey Cash Giveaway today! Enter daily to increase your chances of winning weekly $500 prizes or the $3,000 grand prize.  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. Thanks for joining us, America. We're so glad you're with us. Rachel Cruz, number one best-selling author, Ramsey personality, and co-host of the Smart Money Happy Hour Ramsey Network production is super popular. My daughter is my co-host today. Open phones at 888-825-5225.

Jacob starts this hour in Oklahoma City. Hi, Jacob. How are you? I'm good. How are you, Dave? Better than I deserve. What's up? So I'm 25.

My wife is 28. We have about $13,273 in debt. We are going to pay that all off by December. In July, we will be moving into my grandfather's home where he is going to let us pay rent to him. But we will basically be able to take all the money that we pay in rent and put it back into the property. The property sits on about an acre and then has a surrounding 40 acres of pasture. And we would like to start farming and ranching sometime next year. Currently we make about $92,000 a year, but sometime next year my day job will give me a raise to about $100,000 a year. Um, but sometime next year, um, my day job will give me a raise to about

a hundred thousand dollars a year. I worked for my parents' roofing company and I will basically be taking over the company. Um, so at that point, I'm, I'm just kind of baffled because I've got so many blessings going on in our life. Um, it's a lot of responsibility to take on. Um, but my big question is, um, what should I do with the extra money that I'm going to be making? Um, should I put that toward the ranch? Should I put that toward, um, you know, after of course I follow through with the rest of the baby steps. Let me make sure I understand the deal. You're moving into property that is not titled to you, and you're going to invest money into property that is not in your name.

So it's in our family trust. I don't care. It's not in your name. Why is it in a family trust? Well, my grandparents are still alive. They have it set up in the family trust to where it goes to... The trust will basically have my dad as the executor when they pass away um but the trust has a trustee today who is the trustee today so the trustee today would be my grandmother because i believe it's the trust name is in my grandpa's name okay um and then once she passes away, it would go to my father's, the beneficiary.

Um, and then it would go, I would assume to me. Um, but we've got a meeting with the lawyers that we're supposed to have set up. Let me tell you, there's no possible way. These people are trying to be sweet. They're trying to plan well, and they're trying to be generous to you, but there is no possible way you should put money into this property unless it's in your name on the promise that three generations from now, it's going to land in your name.

No way more going to go wrong here than go right. And, well, and because to, you know, Jacob, this could be money that you're putting in your own house, right, and building your own equity for your own family.

And, I mean, talk through the why. It sounds like their intention is to give you the property. Yes. Okay, so they should just, my point is they should just do that. Okay. It needs to go into your name because it's unwise for you even though the current set of players the current set of actors are all good people and they all have good intentions it is not in your name and the things that can go sideways are too numerous to count

35 years of doing this show i've heard them them all. Okay. And, um, you know, somebody, you know, your, your dad decides he's going to have an alcohol problem or he decides he's going to whatever, or your mom accuses him of something he didn't do, or I don't know. I mean, oh, crap, man, crap hit. And then, and then he's in control of this blessing that you now have invested a hundred thousand dollars into something that's not in your name. You're going to lose it and then he's in control of this blessing that you now have invested $100,000 into something that is not in your name, you're going to lose it all. Do not do this. It's okay if you want to live there, but don't improve the property

unless it's in your name. And if their intention is to put it in your name, there's no reason they can't go ahead and do that. Okay. There's no estate tax planning. Is your grandfather's estate worth over 27 million no okay then there's no reason from an estate planning perspective that they can't go ahead and move the property into your name it does not have to stay in a trust and um it's just not necessary this particular piece of property it sounds like

there's a difference of putting a name on a deed of the person that owns the home that's still living versus it passing like like capital gains tax i mean like is there any like doesn't matter because if grandpa if it was just in grandpa's name and grandpa has a car wreck and gets sued for a half million dollars because he accidentally kills somebody in a car wreck and you know he gets uh you know a 10 million dollar judgment against him then they've lost it yeah and it because it wasn't in his name and so you just you there's all these things that can go wrong and nothing that goes right here there's no and there's no reason for it so that's what i would do and as far as your long-term investing you've got a lot going into family business and a lot going into your uh and property. Hopefully it's going to be

deeded to you so you can do that. So you need to be doing for sure some other stuff like a standard retirement program, get you a couple of Roth IRAs going and get some stuff in mutual funds where you're not all in Oklahoma farmland. Not that there's anything wrong with Oklahoma farmland, but you don't want all your eggs in one basket. That's what I'm saying. So you need a good retirement program going. So be putting 15% of your income away like standard baby step four for that. And if you want to do more real estate and stuff later, you do that with money you save up and pay cash after you get this other thing worked out. But we're not living in grandpa's house for free and then go buy rental property. You need to work through this.

You need to work through this with them because this is not, it's not setting you up in a position of reasonable strength and reasonable dignity. So it's unreasonable for you. It's not unreasonable for them. It's their property. They can do with it what they want to do. But I'm not saying they're doing anything wrong. But I am saying if their intent is to go ahead and give it to you, they can do it now.

Yeah. Well, and I think that's what's difficult sometimes. Like with Jacob, you know, I'm like, I don't know how old he is. Twenty-five. Oh, twenty-five. Yeah. So I'm like, that's the hard lessons of life that, you know, in his perspective, ew, it's perfect, right?

The dominoes will fall perfectly right in a line. This makes sense, right? And then that's where, when it comes to this money stuff, being extra formal in it, meaning documentation, contracts, right? I mean, like all of that, it's just to cover your bases. And I feel like sometimes we tend to not go as formal with family. That's where get burned exactly because you just assume everything's gonna fall into place as it should and to your point the hard the hard part is we've seen it all heard it all and and I think it's reasonable Jacob for you to go in and say that because they actually could say that's a great idea maybe they

hadn't even thought about it I don't know and when I go ahead and deed it to you and then you guys get the benefit of it all. So it's just seeing the back end of it that's always difficult, which is what we see sometimes. It sounds like they see your potential and you moving into running the family business and you taking the helm of the family over time. And so they obviously have great respect for you by all the things you're telling me. But this deal here is a little weak and y'all need to work on it. This is The Ramsey Show. Hey, when you go against what society thinks is quote normal,

like avoiding debt, for example, it might seem weird at first and that is totally okay. We want you to be weird if that means doing things intentionally, including how you spend your health care dollars. And one way to be intentional is with Christian Health Care Ministries. CHM isn't health insurance. They're a health cost-sharing ministry that's helped hundreds of thousands of families like yours take care of health care costs without sacrificing their freedom. Find out more and join at chministries.org slash budget. That's chministries.org slash budget. Rachel Cruz, Ramsey Personality, is my co-host today. Kimberly's in Colorado Springs. Hi, Kimberly. Hi, Dave. How are you? Better than I deserve. How are you? I'm hanging in there. Cool. How can I help?

Okay. So I called because I recently got divorced. I have three children, and my former spouse, when the court ordered all of the debt and all the things, my former spouse was court-ordered to pay off a credit card that's in my name. Now, we sold our house. I got all the money from the house, paid the lawyer, paid all of my other debts except this one credit card. And so my question is, so I got a decent tax return. And so I was wondering, do I go ahead and just pay it off with the tax return from my money or do I just let him pay it as he is able to?

He just got the money from the house. Why didn't he pay it off? He didn't get any money from the house because that's how much was back owed. He actually still owes me another $14,000 that's coming out of his 401k that hasn't come through yet that's still being worked on. But he didn't get anything from the house because of how much what's the balance what's the balance on the credit card um it's about 2,200 what do you make um i am a stay-at-home mom so i get about 1,900 in child support i have a three-year-old and then a nine and an eight-year-old and so i stay home with them and i use the child support in alimony to cover our bills.

And then once my three-year-old goes into the pre-k. 1,900 is the total you're living on? Yeah. With three kids? Well, I'm selling everything I can, and I have a small, tiny, teeny, tiny pottery business. You know the math on that doesn't work, right? Yeah. God has continued to provide.

I got about 10 grand back in taxes. God can do math. He can, but he's, he's continued to provide and I haven't had to use credit cards or anything. Um, but this is the last one I'm trying to pay off. And so Kimberly, where are you living? I'm just curious what your rent situation is. I'm in Calhan, Colorado, um, which is about 40 minutes away from the Springs. My rent is about $1,150 a month. And you have $1,900 coming in and you have three kids to feed. Correct.

Are you planning on going back to work? I am. So we have summer coming up and then my three-year-old should be going to school next semester or next in the spring. And so once she goes back, I'm going to go back into the workforce. But I got to stay home with my two big ones. And so I wanted to continue to be able to do that with her. So I've been selling everything I can. I refinished furniture a little bit, too.

And so I've been doing that and then pottery and then selling all the things that I can find to sell. But you said in the spring, do you mean the fall, you'll go back to work probably in August in two months? No, she's talking about next spring. No, I don't know if she misspoke. Yeah, so the school year coming up, so we're going into summer now. Oh, September. Yeah, so August.

August, September. So August, September, you'll go back in the workforce. Making what? I was a stay-at-home mom for nine years, so I'm hoping to make at least $30,000 a year. That's the goal. I have a degree in graphic design, but I kind of hate it with a passion. And so I'm wanting to probably do something in sales or something like that. I don't even know what I'm going to do.

I'm just trying to get through the next few months doing what I can. Yeah, considering where you're at financially, I wouldn't pay for it right now. I mean, the hard thing is, is that it's a little bit of a gamble that it's in your name. So if he doesn't pay, right, then it's all liability. But for right this moment, I don't know if I would. I mean, Kimberly, there'll be a place that there's nothing else nothing else to sell right i mean like you're going to get to a place that like i'm more concerned about your kids eating the master card getting paid right now so um okay and you as long as you understand that the divorce decree says he's supposed to pay it but that divorce decree does not have the power to take your name off of it and so if he doesn't

pay it it's going to be you that gets dinged yeah and that's my thing so at some point at some point if he doesn't pay it you're gonna have to drag him back into court and or you're gonna have to pay it but that 10 grand i would keep for it's 2200 right this second i want to make sure you know that i don't want going out the door to a credit card company. Okay. All righty. Perfect. I appreciate your wisdom. I'm sorry, Kimberly, you're going through this. Yeah. I feel like I would not have loved you well if I didn't say,

I think you need to lean in on this income side harder. I'm a person of faith also, and I do believe that God comes through. But I have noticed that no comes through but I have noticed that no corn grows unless I sow corn for sure I have to put corn in the ground and then God brings the rain and God brings the sunshine um but if you sow sparingly you're going to reap sparingly and going along saying God has provided God has provided and it's going to be okay and I don't have any idea what I'm going to be doing in August. I'm going to love you enough as my little sister to say you need to focus in on this career piece and you need to really start thinking about what you're going to be because you're hurting

and you've been wounded by this whole process. It's terrible and you didn't expect to be here and it's caught you off guard and I'm sitting the other side of it. And the math is scaring me for you. And so I want you to, I'm going to send you Ken Coleman's book, From Paycheck to Purpose. And I'm also going to send you his assessment to start figuring out what it is you want to do. And let's start thinking about 10 years from today, what is the glorious, most prosperous career that you're going to love and make a lot of money doing that you start working towards now and actually engage in in August rather than I think I'll maybe go into sales because I'd hate graphic design. That's I want more thought into this for you than that if I'm you. So hang on. I'll give you those two things

as our gift. And I'm not trying to be offensive. I know you're hurting. But I'm also not going to let you just sit there. Because your numbers are really scary. Really scary. So I want to see some income coming your way for a long-term sustainability for you. Open phones at 888-825-5225. It's awful when you go through when somebody in her situation she her her whole plan was to be a mom with those kids i got to stay home with the other two now i want to stay home with this last one but all of that changed with the divorce you don't get you don't get to make the same choices because of what's going on yeah and i think she and i think you

know she said through the summer yeah i know i'm not saying she's bad I'm no no no no but it's it well what the game has changed it's a new script yeah yeah and that's what is so I mean I'm sure for her it's so painful right I mean just not only the divorce aspect but and I think that is hard for a lot of women it's hard for everybody that maternal instinct is so strong. And for so many women, they, you know, and choose to and want to desire to dream to stay home with kids and do all of that. And then when that is taken from you and you're forced back into something like this,

I mean, it just, it's terrible. It's terrible. But Kimberly, I really think, yeah, I'm glad you called in though,

because I hope that this gives you some direction, maybe a little bit of motivation, but also it just sucks i'm like this is this is one of those grieving things that dr john delaney talks about you grieve what isn't true anymore right and that's gone that that dream is gone now we need a new one yeah so gang uh in 2003 we launched a book called the total money makeover late 2003 so it's 20 years old. We're celebrating with a 20-year anniversary, the 20th anniversary edition of The Total Money Makeover. The humorous thing is The Total Money Makeover has had several makeovers. This is the, I think, fifth revised edition over the years, and it's now over 10 million

copies have been sold and or given away out there that are helping people. It's the simplest, most straightforward and proven plan to change your finances. It's been working since Taylor Swift started her career. What? She was brand new in 2003. She was a teenager. I am so proud of you. How did you know this?

The iPhone was not going to be out for two years. Oh, you Googled the year and found all the important things. Of course I did. T-Swift was there. Okay. I was like, how did you know? The iPhone was not going to be here for two more years when this came out. So, you know, and just think of all the other things.

Like some of you weren't born yet when this thing came out. It's 20 years old. I mean, oh my gosh. So there you go or at a minimum you were running around in your little pampers so um there you go hey name taylor swift's first song dave i can't was that a song no that wasn't it no tim mcgraw that's fine tim mcgraw the name of the song oh that's great okay And now we understand how she's successful. Okay. RamseySolutions.com slash store. Get the total money makeover 20th anniversary edition.

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Good. How are you doing today? Better than I deserve. What's up? All right. So, quick question. My wife and I, we are newly married, and one of our cars is about at 100,000 miles. My question for you is, when is the best time to trade in the car

to get a new car? For a quick, brief context, we have no debt besides a mortgage, and we do have some money set aside for a car, for a newer car. Good for you. Is it breaking down on you, Ryan? I know $100,000 is a lot.

I just... 100,000 miles. 100,000 miles, yeah, that's what I meant. But is it still in good condition, still driving? It is still in good driving condition. Who's driving it? My wife is. Okay.

It's time to upgrade. Federal law is wife gets the good car. So, yeah, and newly married, they may not have told you about the law. But so rule of thumb is this. Number one, always pay cash. Correct. For whatever you drive. Yeah.

Number two, I would not buy a brand new vehicle unless you have at least a $1 million net worth. Because they go down in value so quickly, you really can't absorb the death blows that the mathematics give you unless you've got substantial wealth to absorb those blows. So we're going to do that is never really, I can think of very few times in your life, like almost never, that you would add up all the things that you own with wheels and motors, and it should not equal more than half your annual income. Because if it does, you've got too much stuff going down in value for you to mathematically get ahead. So, I mean, if you've got a $12,000 lawnmower, you know, that's part of the equation, right? And people do. God help us, but they do. And so, you know, if you've got a Seadoo and your Seadoo has a sister and so on, these things all go down in value.

And so, you know, I own a bunch of them too, but it needs to be a small percentage of my world that's going backwards if I want to go forwards. So as long as you're those three things, you're not buying new and a millionaire, you're paying cash, and you're not more than half your annual income, and you want to move up in car, I'm fine with you moving up in car. How much do you guys make a year ryan um combined uh net right now is 70 okay okay and the price range of car would be what um we right now we have uh 20 set aside. And what's your other car worth? For a used car? Probably trade-in value right now

around 15. So you'd have 35 and you make 70. That's about the max. That's half your annual income. That's what I was just talking about. So you don't need to be driving two $40,000 cars when you make 70. Because they driving two $40,000 cars when you make $70,000 because they're losing $10,000 a minute, and you can't get ahead.

So that's about the most you ought to be driving, making $70,000. Now, I think you said $70,000 take-home, so, I mean, we're talking about gross revenues, gross income, but still, you're right in that range. So that's fine. What you're outlining makes sense, and it's okay to do that, but that's some good guidelines. And folks, it's real simple. It's not because I hate cars. I actually love cars. I've got a bunch of nice cars. I like cars, but they, the, they, I hate

what they do mathematically. And I certainly hate when you're going, when you're losing 60% of the value in five years, if you buy a new car you buy a forty thousand dollar new car you lose twenty four thousand dollars in five years you can't afford to do that if you don't make a lot of money and get ahead not in not in make progress and i'll say this too i was interesting there's a account on instagram i've gotten to know her name's kelly but she's called the car mom and she goes through and reviews cars it's like her big thing and she's become an expert her i think her dad i think she's in like the car business her family has been but it's been so interesting i talked to her on my show i had her as we're talking about these cars

and she was saying though how cars today we used to say the hundred thousand mile rule and she's like but the way they're built now they last longer so that was a little bit too why I was kind of pushing on it again if you want a new car mathematically you can but don't just assume you guys these days that yeah just because it has a high mileage that it's done right like if it's not giving you trouble and you're content in it then if it's a dodge neon it's probably done but it was done when you drove when you bought it so you already screwed up but i know but there are some most of the cars but most cars you're right most of them are great

vehicles the way that they make them now they do last i mean a dadgum camry or a honda a cordo run 300 000 miles without an eye blink yeah so you can great vehicle yes she's right she's right i agree with her yeah so you can go upgrade right in the math and everything we just talked about but also um just remind yeah in the back of your head that yeah you may you know you know maybe high mileage but the first guy that ever worked here was named russ carroll that helped us do and did financial counseling here and russ always would sit with clients and say okay want or need is this a one or need here's your need your need is transportation but everything above something that provides transportation is simply a one or a need here's your need your need is transportation but everything above something that provides transportation is simply a want so and and but we justify it it needs an

airbag it needs this an airbag yeah probably well it needs to be my little children are going to die and you know all this crap and no they're not okay and so um that's just bull crap uh and so but this thing of you know i we we we justify our ego asks and call them needs when they're actually wants anything above the basic service of transportation so ryan moving up out of a hundred thousand mile car in his that's not giving him trouble that's not giving him trouble is a want yes and it's an okay to spend money is fine yes okay to spend money on once i gave you the guidelines to spend money on once but we don't and he didn't he didn't but don't call up and don't more importantly than us don't tell yourself that somehow this is a need oh god we're dying and all this drama queen crap in your head that

people do in order to justify buying something that they just simply wanted and they couldn't just own it just i wanted it why did i buy i wanted it okay i i don't have a single vehicle today that isn't 90% of the reason I own it is luxury. 10% is transportation. I mean, because they're ridiculous cars. And so it's just, but it has nothing to do with nothing. And it's not that I need to impress you with a car. That's not the point because I don't buy it for you. I bought it for me.

But, and what you think of the stoplights are relevant to me. But the thing that, but this thing of of I want the prestige of a car. Yeah. Yeah. This sense of security, which is false to her point, 100000 mile car. So all of that that these are wants. And so be careful. Is this a need or is this a want?

And, you know, clothing. Is a need. An eight thousand dollar purse is a want and there's nothing hundred dollar purse there's nothing there's nothing i don't know i i i've seen a lot of uh what are they coach or whatever these louis baton stuff whatever i mean this crap this is all there's nothing wrong with it i mean one one gun is a need oh my gosh a closet full of guns is a want that would be me okay i'm picking on your purses so i'll pick on my guns all right so it's a want and so i can't use them all at once to protect my family so it's a want yes needs versus wants it is is, though, a real

conversation because the expectations of lifestyle within those categories is so high. The norm already is high. So challenging yourself a little bit on that I think is healthy and good. So Ryan, yes, y'all can upgrade a car. You got cash. It's within the mathematical

limits, but just because it hit 100,000 miles doesn't mean you have to if it's not breaking on you. Oh, there you go. I'm going to close this out. This is The Ramsey Show. These days, it's not if your identity gets stolen, it's when. And the only ID theft protection plan I have ever recommended is from Zander Insurance. It helps real people with real

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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. Rachel Cruz, Ramsey Personality, is my co-host. Thank you for joining us, America. We're glad you're here. Leslie's in Hamilton, Georgia.

Hi, Leslie. Welcome to the Ramsey Show. Hey, I am so glad I get to talk to you. So my question for you today, I am 27 and I just started having like any sort of concept about money maybe, you know, three, four years ago. And I've been trying to crawl my way out of debt ever since. Well, I went into business for myself about a year ago, and I want so badly to be able to have a budget that, like, I can write down and follow, but my husband, he has, you know, set income, gets paid every two weeks, but for me, my brain, it doesn't, I don't understand how I can make a budget for myself not knowing week to week how much I'm going to make. I don't even know where to start.

Yeah. So that's an irregular income, Leslie. And a lot of people, they deal with that, whether they're on a commission system or they own their own business or whatever it might be. So the way we teach people is to say okay so you have your husbands that's consistent and then honestly and i have to do this too leslie for mine you kind of guesstimate is what we say that you kind of look ahead because you want to do the budget before the month begins so you'll look ahead using the

every dollar app will the paycheck planning feature help rachel well not not necessarily depending on her income i mean her total income is going to be changing possibly so so yeah so i always just tell people to say hey um yeah i think that comes into play second but to say look ahead and say okay here's what i think i'm going to make and i always kind of go on the conservative end just to make sure that all of your main bills, your four walls, food, shelter, utilities, transportation, all of those are covered. And then in your every dollar budget, prioritize even visually the list of, okay, here is what we have to have. And here's what we have to get paid. So once we're paid, then we know here's the categories that we're going to have. And if the end of the budget, if those last few categories,

you know, if you don't have the money for it because you made a low income, that's okay, because they're not necessities, if that makes sense. But yeah, the paycheck planning action in the EveryDollar app, you're able to say, okay, if my paycheck hits on the 15th, here are the bills between the 15th and the 30th that have to be paid. So you're able to make sure that your income is spread out evenly throughout the month as well. So Leslie, what does your husband bring home? I think last year it was like right at in between $60,000 and $70,000. Okay, so let's call it $5,000 a month.

And what is your worst month? What would you bring home? Oh my gosh, December, I think I've maybe made like a hundred dollars the whole month okay does that happen very often I just hit my one year no I like so I opened my business March of last year and I was doing great all the way up until I would say about November and then it went dead all the way up until it maybe started picking back up the first part of March. And even now, I wouldn't say I'm doing great.

So what are you making now? What are you making in March? Probably $1,000 all month. Okay. Okay, so you're going to have to get this business moving. It's not working very well. Well, and I do plan on that. So right now, I only do nuisance wildlife,

but I actually take my pesticide exam next week. And if I can get that, having, you know, routine places that I go and spray for bugs that, you know, every month, every other month I have like set income, whereas right now I kind of just wait on someone to have a wildlife problem and I go take care of it and you know yeah okay and you got to have a whole bunch more people calling you they got problems and that's how the problem is like i can't afford advertising because i'm barely making my bills yeah but it's not advertising you you got to get word of mouth out and you got to go talk

go talk to builders you got to go talk to people who are property managers you can say when you have a problem call me and here's the card it doesn't cost anything get out there and put some shoe leather in your marketing so you need to get your income up because you're not making enough as part of the problem in this but that's a side issue okay now if you are going to do that if the you know if you can become an exterminator while you're also working with the problem wildlife then you got two pieces of your business model then you can put together maybe you can turn this into a actual job uh at least an income that looks like a job so okay so what rachel's saying let's pretend your your worst month was a thousand dollars a month on average

okay which that sounds like you've made more than that a lot of months and this is just not it's just been a dry spell so let's call it let's say then you would budget for with his five thousand and your one thousand and then you would make a list of things you wanted to do that you did not get into that six thousand and that list is prioritized from the very first thing i want to do if i get $1 more than $6,000. And then once I get that thing, then what's the very next thing? Number two. And the very next thing, number three, and that prioritized spending plan then applies to your every dollar budget. And then you can get that moving.

And that'll drop into that paycheck planning part of the EveryDollar app and start to work for you. Yeah. But really what we're revealing more than anything else here is you don't really have a budgeting problem. You have an income problem. If you were making $8,000 a month and your worst month was $8,000, you probably wouldn't have called me saying I have a budgeting problem. Because you're just starving. You're not making, I mean, you're making $100 and it was, and, you know, and then $1,000.

You're not, I mean, you're not even making wages. You could make more than this working down at Target, you know. And so that's what your main issue is. And you're calling it a budgeting problem, but it's really an income problem. Yeah. And I would say too, Leslie, like if you start getting getting this up we call it peaks and valleys seasons of income too so if you went and made four thousand one month we'll put two thousand aside in a completely separate account i would open up one if it's going to be this fluctuating this much and then on a down month that you have

a thousand you can pull a thousand from that account from the previous month to get what you guys need right to kind of make it a little bit more consistent. You have to be disciplined in that. Or if you're just living on your husband's income. Yeah, and yours is just extra. Then the hills and valleys won't matter. Yep. They just matter how much you can apply to other things that advance you.

Matthew's in South Bend, Indiana. Hi, Matthew. How are you? Hello. Thank you. Thanks for taking my call. Sure. What's up?

Doing good. How would you recommend paying for dental school when I don't nursing school, law school, what people, what they fall for when they're pursuing one of those lofty degrees is they're just so thrilled if they get accepted somewhere that they don't even look at the price. And so the first thing is look at the price because there's a vast spectrum of dental school. You can spend $600,000.

You can spend $200,000 to get through. It is very expensive. Dental school is expensive. It's inordinately expensive. It's more expensive than getting an MD is what we run into. But even then, I'm going to look for the cheapest possible dental school, number one. Number two, I'm going to start studying the dental industry, the labs, the suppliers, the vendors, and find who's got scholarships.

There's not many of them, there are some and i've heard some wonderful stories of people going and doing that and i've heard i actually ran into a lady in the cracker barrel restroom true story true story more information than i needed well we went to cracker barrel and i was the bathroom this lady stopped me she's like are you rachel cruz i said yes she's like oh my gosh so she went on and she said I just graduated true story Matthew from dental school she said I worked for the college and she's graduating debt-free yeah she worked for the school if you work for the school you get free tuition and I was like no way and she was like yes I was like because I hear these stories right every now and then we'll hear it so I remember tucking that one away I was like I'm gonna

remember that next time someone calls about dental school because that was her she was right there and she said that she graduated and completely debt-free. So there's these other avenues to Matthew that you can see. Just be thinking about it different, Matthew, than the way the standard dentist thinks about it because they come out with $500,000 or $600,000 instead of one debt. And it is a long, hard life if you do that. And if you don't believe me, go watch our Borrowed Future documentary. You'll see a dentist there that's a million dollars in debt.

And you'll see a grown man cry. It's really distressing. The good news is that guy's worked his way out of it. But wow, it was a mess he was in. So yeah, go watch Borrowed Future and that'll scare you straight. 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. Thank you for joining us, America. I am Dave Ramsey, your host,

Rachel Cruz, Ramsey personality, number one bestselling author, co-host of the Smart Money Happy Hour with the one and only George Camel, and my daughter. She's my co-host today. Open phones at 888-825-5225. Chuck is in Green Bay, Wisconsin. Hi, Chuck. How are you? I'm doing fine. How are you, Mr. Ramsey? Thanks for taking my call. My pleasure. What's up? Well, I'm considering paying off two vehicles that I have and my home. And my wife has been pushing me to do this.

And I'm wondering if it's a good idea. Paying off two vehicles and paying off your home, is it a good idea? Well, it wouldn't be a bad idea. No, it would be coming out of my IRA, so I'd be paying taxes on it. Oh. So that's part of it. How old are you?

I'm 65 and my wife is 67. And how much would it take to pay off your vehicles? If I have two vehicles, it'd be $30,000. Okay, and how much to pay off your vehicles if i have a two vehicles uh i'd have to be 30 000 okay and how much to pay off your house 32 000 that'd be 40 40 on the house so yeah so i figured it'd be 80 000 for my ira so 70 so 70 000 plus taxes correct okay and how much is in your total nest egg? I have about $15,000 in non-taxable savings and probably $980,000 in annuities in two different investment companies. Mm-hmm. Okay. All right. So you're a millionaire. Way to go. Well, of course, but yeah.

No, you are. I mean, you've got equity in your house, too. Yeah, that's true. So you have a net worth of over a million dollars. What's your home worth? Probably about $300,000. Yeah. Okay.

So you're worth about a million, too. Good for you. Well done. Oh, thank you. Well done. So my son has been pushing me. I call him Dave Ramsey Jr. because he's been listening to your program. So these people are all, and your wife is telling you to do this also,

or you're wanting to do this? She's been wanting to do this. My son has been convincing me to do this based on your, but he told me I should get your opinion. Okay. I got you. All right. Yeah. this based on your but he told me i should get your opinion okay i got you all right yeah so um well the answer to the question is is pretty simple is i would pay off the car in the house by morning uh before the before the close of business today no question because you'd have

900 000 left over and everything's paid for now but the more importantly than what Dave Ramsey thinks, because it's not really an issue, is why would you do that? Well, number one question is why would you not do that? What's the downside? There's not really a downside. If your home was paid for and your cars were paid for and you had $900,000 in your investments, you wouldn't go borrow 80,000 to enhance your investments. No. Well, in essence, it's the same thing.

And regardless of low interest rates and things like that. Well, I mean, you wouldn't go borrow regardless of low interest rate. Yeah, that's true. And so by asking the question in reverse, that's called a sunk cost analysis. It makes me think, oh, yeah, I need to pay it off. And for the very reasons that I wouldn't go borrow if it was all paid for on it to enhance my investments, it's the same reasons I'm going to cash out $80,000 worth of the investments to be debt-free. It's the exact same analysis.

Yeah, okay. debt-free it's the exact same analysis yeah okay and the other thing is it's if if i'm wrong and your son's wrong and your wife's wrong and you hate being debt-free you can go back in debt no no interest in well i mean it's not hard you know that you're a millionaire you just call up the banker and you'd have a mortgage by the end of the next day, right? They would love to loan you money, dude. You're like the kind of guy they're after, right? What makes you not want to do it? It's just because the car payment is not painful every month?

You just don't care? I guess paying the taxes. Oh, I hate it, too. Instead of leaving it and compounding in the mutual funds. Yeah. Sure. Sure. Yeah.

And truthfully, it's that you've protected that nest egg like an eagle. I mean, you wouldn't let nothing near that nest egg. And that's how it got to be freaking 980 grand, right? Because you protected it. You put money in it. you kept putting money in it you've kept your claws out nobody's touching this and now these people are trying to get you to touch it and you're going i don't think so this is not how i got here and so that's you know truthfully you're you know one of your greatest strengths is is um turning into a bit of a weakness in this particular discussion but but i'm so proud of you you i'm assuming you didn't inherit a bunch of a weakness in this particular discussion. But I'm so proud of you.

I'm assuming you didn't inherit a bunch of money. I'm assuming you did all this on your own. Yeah, my wife and I worked and put a significant amount in my IRA, and the last four or five years that I worked, I maxed it out as much as I could. Yeah. That's great. I'm so proud of you.

That's awesome, Chuck. I wanted to pay it off before I was done working, but I didn't, so here I could. Yeah. That's great. I'm so proud of you. That's awesome, Chuck. Well done. I wanted to pay it off before I was done working, but I didn't, so here I am. Yeah. And I'll give you one last thing for the people out there listening and for you, too. Something else is going to happen here that you hadn't even thought about, because the debt is so small as a part of what you're doing. I mean, it's like buying a biscuit, you know? And it's like, I mean, we're talking about what? to compared to your total nest egg i mean you got a million three

million two and we're taking 80 grand yeah we're taking 80 grand so it's so small it's irrelevant really mathematically speaking but what you're not going to see coming is about three weeks after you pay this house off you're going to wake up and go i can breathe a little deeper yeah because the borrower right now the borrower is slave to the lender and you you're you're not going to be a slave anymore and you're going to be able to feel that down inside you'll physically feel it probably because you've been so long at this and now it's like last step yeah and there's a relaxing no banking your life there's a piece that goes with it yeah and and just to say it out loud people probably know but even for those that are listening they're newer we say don't take money out of your

retirement to pay off debt but he's of age when you're past 59 and a half yeah then you're able to take money out yes he's still gonna be taxed on it because it's a traditional of age when you're past 59 and a half yeah then you're able to take money out yes he's still gonna be taxed on it because it's a traditional IRA but if you're not if you're younger than nine 59 and a half no you don't touch your retirement to be off debt and if your nest egg's too small yes if your nest egg was 120,000 I wouldn't pull 80 out of it yeah that's right I wouldn't you have to live on that on retirement i might sell the cars yep but i'm not pulling 80 out of 120 so the point is it's a very small it's more of a theoretical and emotional discussion for him than it is mathematical because it's just such a small percentage yep so the math really is irrelevant in this it's more of a man i have to i did it i did it i hit i became a millionaire in america

as a working man and i saved my money and we piled up a bunch of money in the last few years of work he said and i'm not touching that and now i am going to touch it yeah but he did it and now i'm debt free and the house is paid for yeah and the cars are paid for. It's like touchdown. Touchdown, baby. I mean, you just broke the tape on the marathon after 26.3 miles. You just broke the tape. You leaned into it, baby. Well done. Touchdown.

I love it. This is the Ramsey Show. Rachel Cruz, Ramsey Personality is my co-host today thank you for joining us America we are glad you are with us well if you are on baby step four which means you're out of debt everything but the house and you have your emergency fund in place fully funded at three to six months of expenses that's one two and three that means you're at baby step four you're starting to invest for retirement five is kids college six is pay off the house early or seven is your debt free everything if you're anywhere in four and beyond

we invite you to uh live like no one else because we tell you to live like no one else so that later you can live and give like no one else that's the idea right so we have the live like no one else so that later you can live and give like no one else that's the idea right so we have the live like no one else cruise yeah that's right we're going on holland america which is a fabulous line we're going to turks and caicos saint thomas san juan the bahamas all the ramsay personalities plus a bunch of other special guests like my friend steven curtis chapman is going to hang out with us my friend manit sh Chauhan from the Food Channel, Iron Chef winner. Dina Carter, famous, remember Strawberry Wine, famous country singer, yeah, is going to be with us. And several other people, quite a boatload of stars, including all the Ramsey personalities. We're going to be doing events on the boat through the whole time, talks on the boat.

It's going to be, it's a ship. Don't quit calling it a boat my wife gives me a hard time so anyway the thing is almost sold out it's not yet sold out but it's like 70 percent gone and it's only been up for sale for three and a half weeks and it is next march 22 through 29 of 20 of 2025 so go to ramsaysolutions.com slash cruise and uh before the cabins are gone because they're going to be gone and we would love to have you if you're baby step four and beyond please do not go into debt to do this we don't need your money that bad you can come on another one and please don't do this if you're uh don't have your emergency fund in

place and you're in debt. So it's baby step four and beyond. Live like no one else so later you can live and give like no one else. So this is the live like no one else cruise. We're not hypocrites. We're not trying to get people to do something they can't afford to do. We want to give you a place to celebrate, though, for those of you that have made the journey with us and you're further up the baby steps.

And so it's going to be a lot of fun. We're going to have a blast. And all the ramsey personalities are going to be on the ship the entire week including sharon and i so we would love to have you guys to come as our guest lucas is with us in nashville hi lucas welcome to the ramsey show hey richard hey dave how y'all doing? Great, man. What's up? I work in the media industry for about 13 years, and I made a move to Nashville because I'm trying to switch industries over into the aviation industry. I'm a private pilot, and I'm trying to finish up my training to do that full-time.

Paul moving here took a job of looking for something like either remote or part-time just to add supplemental funds to be able to fund the training, and started out a business. It was fantastic and ended up kind of going into that, taking on a lot more roles and got kind of integrated into the business. Here about two months ago, the owner let me know that he wasn't going to be able to pay me and that he'd be able to get money soon. But since then, I'm three paychecks behind, and I'm in a position where I feel like if I leave or say something about it, then I'm kind of putting the last stake into the company and kind of hurting the friendship that I've built,

but also aware that it's slowing down my life goals. No, it's not life goals. That's not the problem. The problem is friends don't do this to people. I'm with you. So you haven't built a friendship um you've built a relationship and you care about these people but uh they've not they're not taking care of you 100 yeah and so and what you're describing to me is you're not really getting much communication about because dude if somebody's not paying me i want to know a lot of detail as to why that that's where i'm at and you're not getting it i've personally signed clients

signed a quarter million in clients so i'm like where's the money that's a fair question so um yeah i i don't think you're going to be there in 30 days, but if you want to give it one last Hail Mary, it would be sitting down in person with the owner and saying, okay, I am officially done unless you clue me in on every detail here. Because I signed a quarter million dollars worth of people and i can't figure out why i didn't get paid where's the money yeah it's a fair question yeah that's kind of that's kind of where i'm at i'm trying to get to a place where i'm not feeling uh responsible for

you're not that's it that's the part lucas for me that i'm like you've you've you know um yes is your work there vital and is it the linchpin on a lot of what's going on possibly because you're good at your job but that's not your responsibility that's not your responsibility to hold the company together that's the freaking owner and ceo's responsibility so for you i'm like i would not i that's emotional bandwidth that you don't need to have i mean you don't you you are a team member they're on the team but if lucas leaves and the whole thing dissolves that's not your fault lucas like that's not your fault and by the way you're not just you didn't just up and leave because you were mean you didn't get paid you've been

working for free hello you know and so yeah there, yeah. There's a lot wrong with this. You sound like a nice guy, but they're probably taking advantage of you too, Lucas. To a degree. I don't think you're going to make it there, and I don't think they're going to stay open. I don't know. I mean, hearing that, it just kind of confirms. I have a feeling that I am doing it to to myself like going myself into it like that yeah you have a track record for getting kind of 100 well it's okay hey i love getting people giving 100 but but you got to think about what you're

giving 100 too yeah you're not getting 100 back you're not even getting 50 back you're not even getting a paycheck back yeah you know so i mean it's like if if if if if the tables were turned and you're with the owner and you were your back was against the wall and one of your key people was on the other side and you couldn't pay them i know what lucas would do after talking to him for just a few minutes. You would give a thorough, detailed explanation and say, if you'll join arms with me in this and help me turn the corner, I'll make it worth your while. It's going to be a minute till we get this other thing to clear, and I'll show you what it is.

And you would tell them what the flip is going on. Or we're in a bad position, Lucas, and it's not good for you to be here, so we're going to have to let you go. We can't afford to keep you. I pray you go make more money somewhere else like yeah if i actually love you then i want what's good for you yes yes yeah is it is it being like bad to myself or like dumb to me if it's like financially i can like stick it out to try to like help in any way i can with what little you know communication i have well i i don't think you know they haven't earned you yeah with the way they've treated you

if you wanted to donate some of your time so to speak because you're able to in order to help this business turn because you believed in these people but dude yeah the people you're describing to me i don't believe in them i'm with you because you know you need more than just a circle workout dude yeah while i cash 250 000 worth of checks and you don't get paid i can figure it out that didn't no i i need an explanation show it's a j Maguire moment. Show me the money. You know, and it's like, whew. And this isn't even your end goal of a career track, right? You just got sucked into it. It was supplement, yeah.

But he cares, thank God. Yeah. A team member that cares. That's wonderful. And he cares about the people, thank God. Yeah, but they're taking advantage of him. Oh, definitely, definitely, definitely. And I don't know whether it's a lack of business acumen, lack of basic relational skills.

Or something sketchy. Or they're crooked. Or all three. But you're due a lot more explanation, detail, than just, hang on, it's going to be all right. No, not. I'm not going to do that. This is the Ramsey show. Rachel Cruz, Ramsey personality is my co-host today. Today's question of the day comes from Denise in Ohio. She says, my husband refuses to sit down and talk about a budget. He doesn't want limitations on how he can spend our money. I never know when I'm going to come home and find a new vehicle in our driveway.

Jeez. He has two muscle cars, a truck, several all-terrain vehicles, motorcycles, and plans on always having a car or motorcycle payment. This has forced me to separate our finances because I have no doubt that he would find a way to spend my money along with his. We both contribute a portion of our income to pay bills. He wants to be in charge of that, but is regularly late on payments. Lately, he's been telling me not to put money in my 401k or I'll lose everything. He doesn't have any retirement savings

except what he invests in silver. I don't know what to do, but make sure that I have a secure retirement. I don't know what to do. D-I-V-O-R-C-E. That's the only way you're going to be secure in retirement. This guy's... He's out of control.

No, you're not married to a man. You're married to a child. I want to buy me a big truck, and you can't tell me I can't buy a big truck, Mama. You can't tell me nothing. And the world's's gonna come to an end anyway so I'm gonna put my money in silver it's a freaking four-year-old just guys disgusting he's disgusting I don't know what you're still doing there I mean you're you're married to the equivalent of an alcoholic who does cocaine.

I mean, this is so out of control, such self-centered behavior, such immature behavior, it's hard to measure. So, you know, the only hope you've got is to sit down and see a marriage counselor and let them give you the words to guide him into the marriage counseling office with your pastor or with a good marriage counselor that's trained or however i don't care but um someone needs to be giving you words other than me because i'm just so pissed at this guy right now he's useless um but so i mean unless he, if you stay married to him, you're going to be broke your whole life. And frustrated because the anger is dripping out.

Well, and just the selfishness in it all. Not only does he not want to talk about it, he's making decisions without you, all of this. And that's not just with the money side. That's probably happening in every part of your marriage. This guy does whatever he wants to do whenever he wants to do it. He has no limitations on him whatsoever by anyone. He likes one person on the planet himself. Self-ish is what we call that.

It's the opposite of selfless. Yeah. I can't even imagine what Winston Cruz would do if you came in and started acting the way this guy's acting. Or if Winston Cruz came home acting the way he's acting. I mean, like, either way. Yeah. I can't even imagine. Well, it's just a spouse.

And that's the thing that's so hard. Not only is the financial decisions that he's literally making in reality of buying very expensive things, not saving all of that. But let alone the spouse that's like, well, I just disrespect. Well, and it's just the spouse, too, that just says that first line. He refuses to even talk about the budget. Like even that in and of itself. I do what I want to do. Is showing, yes, this level that you're not seeing marriage as a team at that point and and she's suffering denise suffers because of that so denise if if you were my little sister and i loved you which i do

i would say i don't want your marriage to end but i think your husband has chosen to end it so um what i would tell you to do is to go see a marriage counselor and he won't go because he won't do anything that it's not about him. And the marriage counselor is going to guide you in a proper, not a radio answer or a podcast answer in a proper series of steps to confront and ultimately lead to what we call an ultimatum, which is either, Bubba, you're going to get in marriage counseling with me, and we're going to start handling our stuff together, and we're going to both have a say in this,

and you're going to start respecting my viewpoint, not just yours, and either those things are going to happen, and we're going to start handling money together, and we're going to start being wiseriser or I'm not going to be here. So you are going to choose to be divorced, sir, if you don't agree to make some changes. That's what you're telling him. The result of you continuing to do this is going to be I'm gone. And you need someone to guide you in that process not me not

just me getting fired up at this guy that's not I don't want to transfer that to you but you need to sit down with a coach a counselor a marriage counselor that can guide you in much better much better than I can Rachel can but will guide you in a series of conversations with your husband that lead to finally saying, either you stop this behavior and we get on the same page and we go to marriage counseling where you start respecting me and loving me as much as you love you, or we're going to call this. I'm done. Because you're going to, this is a, you can't, fast forward this in your mind, Denise, 20 years and see where y'all are.

You have a lot of rusty trucks in the yard. That's where you are 20 years from now. And it's sad. I mean, he chooses that over you. I mean, it's what it ends up being. And it's really sad. Yeah, this guy's got issues. His mommy and daddy never told him no.

And how dare his wife be a grown-up now that's what's going on when i was growing up they don't say this anymore it's not it's a saying people don't use anymore that that if you never tell your child no and you buy them everything they do not learn the ability to have self-discipline because they've never had discipline. And when I was growing up, we called that so-and-so was a spoiled child. People say that. Like spoiled mayonnaise. Have you ever smelled spoiled mayonnaise?

It stinks to high heaven. Spoiled children stink worse because they become Denise's spouse later. And that's what this is this is a spoiled brat little boy that you chose poorly when you married or he well no really i mean you never know i know i'm not saying that because i don't know i don't know the story of that but he sucks now so there's no question about that yeah Connor is in Minneapolis. Hey, Connor, how are you? Good afternoon. Hey, what's up?

So I'm looking to save some money to invest in some form of entrepreneurship after I graduate college next May. Currently, I'm caught between buying a vehicle to see my family and friends on the weekend back home or staying at college to complete this internship I committed without buying a car to maximize the money I can make. How much money are you saving up for your entrepreneurial endeavor sir um well i would be able to save five grand this summer additionally if i didn't buy a car and you're going to buy a car that's five grand uh that's probably where it would go yes yeah okay

that's okay if you don't have a car and you buy a $5,000 car and you pay cash for it, I would buy the car. You'll find a way to do the other entrepreneurial things. You'll scratch the money together. It may delay that a little bit, but what you're doing is not unreasonable. You're in college, and if you delay starting a business a little bit so you have a $5,000 car, that's not an unreasonable decision, sir.

Okay. I'm all about business. I've been an entrepreneur my whole life. I started cutting grass when I was 12. So I've been self-employed, straight commission just about my whole life, all but about three or four months probably. Actually, I did have a real job one time, but didn't last. And so, um, but yeah, so I, I believe in you. I want you to be an entrepreneur in the future, but, but I don't think this $5,000 decision

is going to keep your dreams from coming true. As a matter of fact, it might actually facilitate your dreams coming true as you can actually get around. You have transportation. Hang on, I'm going to send you a copy of the book Entree Leadership that was a number one bestseller. It's how I grew my business. And so since you're a great future entrepreneur, I'm going to help you with that as my gift. This is The Ramsey Show. Rachel Cruz, Ramsey Personality, is my co-host today. Matthew is in Springfield, Missouri. Hey, Matthew, welcome to the Ramsey Show.

Hello. Hi, what's up? Well, recently I found out I was having a baby and got engaged, and she has a daughter of her own from before we were together. So I started getting serious. I own a construction business, started getting serious about paying some stuff off. The baby's kind of making me, you know, sweat a little bit because it ain't just me anymore. Good for you. Good man. Well, I've had a construction business and had a ton of debt, had about 30 employees.

We're doing $4 million to $5 million a year for about three years in revenue. And for 23, I thought I was on my high horse. I thought I was it and taking on a lot of debt. And then things slowed up last year. I had to lay off, continue to lay off more and more people. And it kind of just snowballed down. What was the debt for? And then things slowed up last year. I had to lay off, continue to lay off more and more people. And it kind of just snowballed down. What was the debt for?

Oh, just random things like business loans. A lot of it was equipment that I'm currently liquidating most of it the best I can. Okay. How much debt have you got? Altogether, including my personal, is $360,000. Honey, it's all personal. You sign for every bit of it. Some of it's in the business bucket, but the bank doesn't call it that. They have Matthew on the hook.

So $360,000, do you own a home? Yes, I do. Is that part of the $360,000? No, that is not. So you so you have 360 000 not counting your house on what uh just uh owing vendors and uh getting behind i had a bad dealing a guy owes me 120 grand went to court got a judgment now we're trying to collect on the judgment um it it's mostly vendors and subs it's equipment and uh how much do you owe on your equipment our equipment things that i could sell right now it's about 73 000

i'm sorry why couldn't you sell all of it um well right now i'm upside down yeah most of it how much do you owe on equipment 73 000 no you you said that's what you could sell you owe more than that on equipment no 73 000 is what i owe on the equipment that's everything on the equipment so you have everything you have you have vendor debt to the tune of two hundred and ninety thousand dollars you know in a one hundred and twenty thousand dollar judgment lien that's an asset yeah so 170s left how much of it is like just no she he's not getting that judgment so um but that's okay uh anyway uh i mean i don't think you're gonna collect on that judgment do you mat, Matthew? Well, we'll hear next week. The bank's supposed to respond. No, I mean, the guy you sued doesn't have any money.

Yeah, I would assume so. Yeah, I would assume so, too. So you're not going to get any money. Lawsuits don't make people have money that they don't have. Yeah. So you're not getting that money. So what have you been making profit in the last 12 months? I don't really know exactly the answer to that. It's been a downward, like up and down.

And then about, I would say October last year, it kind of fell off a cliff. I know my monthly revenue has been about $250,000 for the last part of last year each month. Then it went down and down, and right now it's about $40,000 a month. And what were you doing that was $200,000 a month in revenue? We were building custom homes, you know, multimillion-dollar custom homes is what we were specializing in at the time. How many homes do you have now that are just spec out there? I don't own any.

I don't even actually have any new construction projects going on at the moment. Okay. So here's the thing. It sounds like, and I work with entrepreneurs all the time. We've got about 10,000 of them in our entre leadership program. Okay. And, um, it sounds like you're really good at building houses. It sounds like you're a very hardworking guy and you really suck at running the business.

Yeah, I would, I would agree with that. That's what it sounds like. Um, because you don't know any of your numbers. You don't know where the money's coming from. I grew up in the building in real estate business and I can't figure out how you were thought you were making $200,000 a month building custom homes because if you build a if you build a five million dollar custom home and if you make if your builder's fee on that's 500 grand 600 grand um you know it's going to take you 18 months to build that house typically and that's not 200 thousand a month and if you'd have to be rolling these things off one a month rolling off the end of the line to be making that kind of money. No, that was gross.

I'm sorry. I meant that was my gross revenue, including, like, money that came in, and I had to pay subs, and I had to pay a lot. We had that one time. Oh, okay. That's the customer paying you for building their house, and you're supposed to pay the subs that built their house. It's not even your money. Yeah. Yeah, that was just my revenue built their house it's not even your money yeah yeah that was just my revenue no it's not your revenue it was money coming in it was money your revenue is from money that your company is actually making in profit your revenue is the builder fee your revenue is not the two million dollars it takes to build the house that's the customer's money follow me oh yeah okay so you don't you don't

you never saw so how many houses a year were you building uh last year uh we had 10 total um start finish and then just various remodel projects in between a couple of framing jobs. And you don't have anything going right now? Right now I've got one addition. It really, you know, interest rates went up, and building kind of came to a halt in my area for, you know, the area that I was working in. I got you. Now I'm trying to, you know, get some more work framing

or doing something elsewhere, but I'm down to just $250,000. And the $75,000, and so the vendors that haven't been paid, those are actually, ooh, you're in a mess. Those are actually customers' money that you've used. Yeah, the vendor debt, it's roughly, I don't know exactly. Yeah, like subs that did work on my house that you were building for me and you didn't pay them, they're going to put a lien on my house. Right?

Yeah. Yeah. Yeah, this is really dangerous. Okay. Scary stuff. So, wow. dangerous um okay scary stuff so um wow yeah you had no bookkeeping systems and processes nobody watching the the flow of cash nobody watching the flow of cash knew what they were doing and it just money coming money going out and when the music stopped there weren't enough chairs

are you do you saw people on payroll matthew just just two people i i laid everybody uh that was w2 employees that's good and i'm sorry what i kind of come to realize how old are you i'm 23 what what do you what um i mean seriously i'm like do you liquidate assets like your your home that you have so what is the equipment that you own the 70 000 it was uh pretty much enclosed trailers all enclosed trailers i've already sold uh the skid steer the gooseneck um i've already sold those but i didn't have any loans on those those were all cash uh i paid for in cash so you mean like a like an 18 wheeler trailer that you're using for storage

on sites like uh there's enclosed trailers like that you pull behind pickups um i had quite a bit of them i think seven at one time okay and they're all up for sale and you're trying to get them sold for whatever but they're not going to bring the full 70 yeah um i i yeah that's where i'm what do you own your what do you own your pickup um that or i could let them get repossessed i really don't that's no you need to you need to sell them because when they repossess them they're going to sell them for nothing and sue you for the difference. What do you owe on your pickup? On my truck, I owe $12,000.

Okay. All right. You're going to have to go all the way back to the beginning and start your business over because you were really good at it when it was small and go from there. And I'm going to give you an Entree Leadership Coach to help you as my gift because I want to help you turn this thing around for this baby because I've been 20 and scared and didn't know what I was doing. I've been right where you are.

Hang on. Kelly's going to pick up. We'll get you with one of our Entree Leadership people and help you walk through this, untangle all this barrel of fish hooks. 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 my daughter is my co-host today. Open phones at 888-825-5225. Benjamin is with us in Los Angeles. Hi, Benjamin. Welcome to The Ramsey Show. Hi. Thank you so much for taking my call. Sure.

How can we help? So I am brand new to trying to get out of debt and change my life. Probably only been listening to you guys for maybe two or three months. And I come from a, like a, a, a not wealthy background. My, my parents, my father doesn't even have a retirement. So I've got to try to plan to kind of take care of him when he can't start working or stop working. And me and my wife just had twins about seven months ago.

Well, congrats. Thanks. But my question stems from I am trying to start me and my family off with Baby Step 1. I'm trying to get ourselves out of debt and moving forward. But my wife doesn't fully feel on board to kind of change our living and thinks we're just doing fine when we're going paycheck to paycheck. So I'm wondering, you know, how do I kind of get her on board with this idea and help figuring that whole, navigate that whole situation do you handle most of the finances benjamin in the house so she won't allow us to combine them

so um she has her paycheck that pays our mortgage um and then i am supposed to cover all of the other bills with my paycheck. How old are you guys? I'm 34. How long have you all been married? Four years. And she's how old? She's 23. And you've been married four years?

Oh, sorry, she's 24. We got married when she was 20 okay 20 our 10-year difference age-wise yeah yeah okay um well she's probably not feeling because she said she's not feeling the paycheck to paycheck and she's probably not if she's the if she's making a better income and her only bill is the mortgage and she's just living her life and, you know, you're the one that's feeling more of the tension. And so I think that's an issue in and of itself that I think would be fair for you to sit down and talk about. It's the why behind Benjamin. I mean, that's what we always say to start with.

And your why of wanting to do this is what? Because you're stressed? Because you're scared if something happens, like, you know, you're not going to take care of this family? Like, what's the why for you from wanting to even engage a different process financially? I mean, the why for me is just that we just had kids. And, like, my car needs some work. Um, I have picked up a second, I've started hanging TVs and doing contract it work in order to. Yeah. So what normally happens, what normally happens when someone first finds us, uh, and they start

getting really excited about what their future could look like if they were out of debt and in control with their money because they're in debt and out of control with their money, and they run into their spouse all excited and jumping up and down in the kitchen and say, I'm going to sell your car. Right? They run into the kitchen all excited, jumping up and down, start talking about what we need to do. We need to get on a budget. We need to we need to do we need to get on a

budget we need to cut our spending we need to get in control we need and you start talking about the what and rachel was saying you probably led with the what and if that if you did that you're normal by the way that happens a lot and if you led with the what you've turned my name into a cuss word in your house. Got you. Okay. Okay. Instead, reset, go in and say, honey, I approached this whole subject that's really important to me poorly with you. I goofed in how I approached you with it, and I'm really sorry. You owe her an apology. apology then reset and say and the reason i'm so excited about this stuff and and i think it's really important for us to work together is because i'm scared to death we've got two kids i'm out hanging freaking tvs at 34 years old because i'm scared and our money's out of control. And it's,

and I don't see a good future of us running this household separately. I don't see a good future if we keep doing things the way we've been doing them. And I don't like it the way it is. And it's really bothering me. And when I found this stuff, it made me, it gave me a little bit of hope and I got a little too excited maybe. But, honey, I can't keep going like this. This is killing me. That's a why. Yeah.

That's a why. I want to be a good dad. I want to provide for our children. I want to retire with several million dollars and sit on a golden rocking chair. That's a why. Not, we got to sit down. We got to get on a budget. We got to get this stuff going.

We need to work these baby steps. Those are what's. Okay. And if she hears your heart and then turns a cold shoulder to you, you don't have a money problem. You've got a marriage problem the phrase you use a lot used a while ago ran a chill down my spine my 23 year old wife won't allow you said yeah to which I almost laughed. Okay? That's how crazy that is.

On either side. If she says, my husband, because we, Benjamin, we get on people that say, yeah, if there's a lady that calls in, my husband won't allow X, Y, and Z. I've been married 43 years. If I told my wife I wouldn't allow her to do something, I'd wake up dead. You wouldn't allow her to do something i'd wake up dead you wouldn't wake up

well so so benjamin honestly i think that first part's important the why and any spouse this is true with anyone that we get a call if you can't go to your spouse and say here's my fear and it's vulnerable right here here's my fears here's um what is scaring me here's what i what i'm excited about here's what i think could happen like when you do all of that and they still just and some will then again that's a whole that's a marriage topic that's not a money problem you got a marriage problem but then number two benjamin too you have to paint the vision for her as well show her not just the what or the why but the how so just on So just get a sheet of paper out and just put some numbers down realistically and say, hey, okay, here's what we make combined.

Here are our bills. Here's our debt. If we had this much margin, we could be completely debt-free. That frees up X amount of payments per month, $1,200, $1,400, $2,000 of just payments that we have. And if we invested that, babe, by the time we're 45, like that's what this could look like, right? Like kind of do some math and just show her the vision on what you've captured it.

Yeah. And so, and bring her along in that. So say the why, say the why and the how, but if those aren't working, then yeah, then there's a, and she's, y'all are probably exhausted. I mean, you're, you're got seven month old twins. Oh my gosh. I'm surprised you even put a sentence together. It's exhausting. So give yourself some grace in all of this. But, um, but yeah, for me, it's the why and the how that she needs to hear. Lead with an apology for having done this wrong and then explain to her, this really matters a lot and I need you to hear me.

And she'll hear you. You'll be okay. This is The Ramsey Show. Well, I think it's been almost 20 years ago. I've read a book called Thou Shall Prosper, and I started talking about it on the air, what a wonderful book it was. And the author called me up, and he said, Who are you? I love you. My book book is selling and he and i became great friends rabbi daniel lappen and i have been friends for it's got to be 20 years isn't it probably it's get down into that microphone get down into it yeah sorry yeah it's okay for it's been probably

20 years right yeah yeah i'm thinking almost it's got to be so i see that would be um that'd be 2002 2000 no it's not quite that long it's probably 15 years, something like that anyway, I don't know, brand new book came out oddly enough Rabbi is an Orthodox Jewish Rabbi and the book Thou Shalt Prosper is his main

the book that made you with your help well, it's a fabulous book it's one of my top ten faves of all time. And so I ended up writing the foreword when you reissued it later. Yes. But this book came out, the new book, The Holistic You, Integrating Your Family, Finances, Faith, and Friendship, and Fitness. Sadly came out October the 8th.

Yes, that's right. By an Orthodox Jewish rabbi after October the 7th. Really bad timing, rabbi. Awfully bad timing. You know, you can't rely on Hamas to get anything right. Okay, I'm with you on that. I like it. So good stuff.

So you taught us in Thou Shall Prosper so thoroughly to not be ashamed of earning as a result of serving. I think one of my favorite quotes was, if you do a good job for folks in business, they give you certificates of appreciation with president's faces on them. And so you've written a lot of bestselling books about money and business and other practical life lessons that are woven all through there from the Hebrew Bible, what we call the Old Testament as Christians and you call the Bible. And that's where you and I have had a lot of common ground, a lot of wonderful discussions. Yes. Fireside and over dinners with our wives and everything else. We've just become great friends. And so what is it that

the holistic you goes into that you haven't done in these other books? Yeah, it's the 30,000 foot view. It's zooming out a little bit and relating to the idea that our lives are actually a complex system. It's not as if these are separate components. In just the same way, nobody would say, you know, your heart is one thing and your liver is something else and your lungs are something else. You know, you go into your heart specialist and say, look, this is what you need. Take this medicine.

It's great. You know, it's going to wreck your kidney function, but it's going to be great for your heart. You know, you get out of there as quickly as you can because I want a doctor who sees the whole me, not just a little part of me. And our lives are very much like that as well. We had a woman who became a coaching client of ours who came to us because she said she's done everything right. She did really well at college. She got into the business school of her choice.

She focused. She graduated top in business administration. She came out with a really great MBA. And she says other people who didn't perform nearly at her level were getting much better job offers than she was. And that alerted her to the fact that there's something real going on. What's going wrong is that while some of her colleagues were attending birthday parties or celebrations, connecting with other people, building up their

own personalities, in the final analysis, when you interview somebody for a job, you're not just looking at grades and GPAs from college. There's a subtle emotional psychological connection that is the result of everything that you have done with your life, because everything you do contributes to making you who you are. So here's a girl who's terrific. I mean, very, very accomplished, but only unidimensionally. She was excellent academically. I mean, she could do a bond yield analysis in her head. I mean, she was really, really good. But her relational IQ was just not there. But the rest, it just wasn't. She couldn't talk about anything else. She didn't have any hobbies. She didn't have any interests. She, she, she'd really deliberately neglected all the other aspects of her life.

So that's why we, we condensed the complexity of a human life into the five fundamentals of family, finance, faith, fitness, and friendships. One of the things that Rachel, I do a lot of controversial things, as you know. Oh, I'm sure. I preach financial heresy all the time to the financial Pharisees out there. And but Rachel is not as nearly as controversial. She's more likable. People love Rachel. And but the one thing that she gets the most hate on is when she suggests dares to suggest that couples combine their finances and not run them separately and uh she actually used a phrase pretty similar to what you've used here in the book that if you can share a bed you can share a bank account

and she's exactly right yes and we go further we say you have to that's that's absolutely essential. Yeah, so walk through that because we talk about this a lot. Why is it so essential? Even just two segments ago, we had this exact call. We get this call once or twice a show sometimes about a spouse. And it's becoming not only are fewer and fewer people getting married now, but many who are getting married…

Aren't acting like it. …are acting and also aren't sure whether they're roommates or married. Yeah, that's what I mean. They aren't acting like they're married. There's a proliferation of lawyers drawing up prenup contracts. I mean, that's a fine way to go into a marriage. And again, if it's a second marriage or third marriage and there are lots of assets and children, complexities exist.

But ordinarily, when a young couple marries, you would have thought it would be with a wholehearted bonding. We're not talking roommates. Okay, this is really, really important stuff. And the reason that you have to share the bank account as well as the bed, and frankly, leaving one is just as ridiculous as omitting the other. But the reason there is because there's something very different about how men and women typically relate to money. Not that a woman doesn't enjoy earning money, not that a woman can't be particularly good at her career and excel at it,

but it doesn't do anything directly to her sexual feminine identity. When a man makes money, it is a very intrinsic masculine related thing to him. And the evidence of that, of course, is the reverse. Unfortunately, we've seen places, regions, where steel as an industry has collapsed. And one of the things we know, unfortunately, is that when a male loses the capacity to earn money, loses a job, heaven forbid, there is almost inevitably a sexual dysfunction that accompanies that. It's almost

inevitable. Never with a woman. When a woman loses a job, it's painful, it's problematic, she's worried, she is embarrassed, but it doesn't hurt. But the way money is identified with us is different. And so learning to work as a team though is is crucial in the unity exactly right of the marriage to say hey we we both are in this together and we are coming at it wholeheartedly into this marriage so every part of our marriage to your point from from my health the way i want to raise my kids all of that yeah has to be in line with my husband right and together we know clearly and i've got to say you know maybe maybe as many of the people who get upset when you speak about these things are people who've sort of almost lost contact with their essential feminine natures. And it's easy to do.

Men can lose contact with their masculine natures and become incapable. A lot of, you know, a lot of the people in the news on campuses today are right there. Do you see the, because I do hear from specifically on the women's side of hearing this message, if something happens, I have to make sure that I protect myself. It's almost this fear element there. And then for the guy, you know, different reasons why. But I do, yeah, I think that is, it is so key. You also talk about, I want to get this in before break,

this work-life balance aspect too and how key that is yeah so that actually is not what we talk about because we figure out anybody who can work a spreadsheet can draw up a work-life balance that's not hard how many years you've been married not telling you because if i tell you then you're gonna know how old the uh the wife is but uh but let's say it's over 44 years and below 46 years okay there you go okay i can probably figure that one out i'm a math guy rabbi daniel lappen the new book is called the holistic you integrating your family finances faith friendships and. Anything this guy writes, I recommend. He's a good friend and an incredible thought leader. Be sure and check it out. This is The Ramsey Show.

Rachel Cruz, Ramsey personality, number one best-selling author, and my daughter is my co-host today. The best way to make the most of your money is by doing it on purpose. That's called a plan, being intentional. In the money world, we call that a budget. Every dollar is our world-class budgeting app, the best budgeting app in the world, and it makes it simple to plan your spending track your expenses and hit your baby steps and move through and level up you can keep a pulse on your spending and share everything with your spouse make progress on your money goals with every dollar download every dollar for free in the app store or go to google play and do it or you can even go to everydollar.com and find everything you need.

Tyler's in Pennsylvania. Hi, Tyler. Welcome to the Ramsey Show. Hey, how are you guys doing? Better than we deserve. What's up in your world? Not much, but to get the long story short, I'm 28, a full-time truck driver.

Started a side business about eight months ago that works out on the road. The only debt I have is $200,000 on a mortgage and $8,500 left on a camper loan. My mortgage is roughly $1,400 a month. I'm paying $2,500 a month. And the camper is $280 a month, but I'm trying to pay that off in the next six to seven months with like a $1,250 monthly payment on it. The question is, once I pay the camper off, should I use that $1,250 and put it right on the mortgage or start reinvesting back in the 401k that I've postponed for the last couple of years?

Stop paying extra on your mortgage. Throw all the money you can find anywhere in your budget at the camper and get it paid off quicker than you were planning to. Once it's paid off, you need to have an emergency fund of three to six months of expenses. That's what we call Baby Step 3. You're debt-free, then everything but your house, and you have three to six months of expenses. Then baby step four is what you said. Start your 401K back over.

Start it again. And 15% of your income needs to be going into your 401K. Make it a Roth if you can and put it in good mutual funds. And then any money you find beyond the 15% going into the 401K with no payments now but a house payment, now we start throwing extra money at the mortgage. But only after the camper is gone, you've got the 401k restarted and the emergency fund in place. Only then do you do that.

Jillian is in Atlanta. Hi, Jillian. How are you? Hi, I'm good. Thank you. How are you? Better than I'm good. Thank you. How are you? Better than I deserve. What's up? Thanks for taking my call. I am calling because I make too much money to live paycheck to paycheck and I need help getting back on track and I don't know

what I'm missing here. How much money do you make? I combined $148,000, my husband and I. Okay. Good for you. Have you guys written out a budget? Do you know where your money's going every month? Have you realized, oh my gosh, there's so much payments, like you're seeing it happen and you're just trying

to slow it down, or you don't even know that? I don't even know that. I't even know that i've been attempting a budget and then i just got every dollar but because i'm coming into it in the middle of the month it's kind of still a little confusing yeah so i don't know where everything's going we're not like living lavishly no you can disorganize your way out of $150,000. Yeah. Yeah. How much debt do you guys have, Jillian? $35,000. Okay.

What's it in? $5,000 in student loans and $30,000 is my husband's truck. How much is that car payment a month? $675. Okay. What's your house payment house payment is two thousand okay nothing you're giving me here that is out of control i mean we've got some goals we need to pay off the truck and the student loan but nothing here is screaming stupid so it sounds like mathematically that your biggest problem is you guys are just not

telling your money what to do. We always laugh and say a budget is telling me people telling their money what to do instead of wondering where it went. You've just been wondering where it went and now you woke up and you're disgusted with that, which is a really cool place for you. That's a, that means you're getting ready to change your life. Yes. And so the second reason why I'm calling today my husband is going to start getting you're you're muffling you need to speak direct into your phone i can't hear you the second reason you're calling is what my husband is about to start getting monthly bonuses oh good on top of his salary and so i want to make sure that we don't just mix that into

everything that disappears every month i want to be intentional with it and you need to be intentional with all of it yeah yes yeah yeah yeah do you guys do you guys have a regular salary or is it commission-based besides just the regular salary regular okay well that's the easiest part of budgeting honestly for so many people the irregular income is where they get really tripped up so so yeah so we're in may right now in the middle of the month you're right so i would i would be looking and saying, okay, in June, here's our budget, and you have your income,

and I'm glad you have every dollar, minus all of your expenses, including giving, and there'll be some savings. Do you guys have any savings at all? $5,000 in a CD. Okay, so I would take that down to $1,000 and go ahead and put a lot of this towards your student loan. And that's pretty much knocked out at that point, which is great.

And then, yeah, you're going to be tracking, Jillian, like every single thing that you spend money on. And I would go back to, you know, April, February, March, like go back some months and see on average, what are you spending on groceries? On average, what are you guys spending out to eat? Like get some averages and plug those into every dollar. But remember, those numbers were numbers when you weren't budgeting. So you're going to be able to say, oh my gosh, we spent that much going out to eat. Well, if we cut that completely out, maybe that'll take it down, you know, the student loan down to 500 because that'll be $500 we're not spending out to eat. We're going to put that towards the student loan. Your grocery budget, again, this is when you're're not budgeting so you're just going and kind of getting what you want to say okay what could we limit there and you're going

to start to see all these things trickle in of oh my gosh this is where it's going and you're going to be able to shore it up and because you guys have this truck payment and this debt I mean I would go through that every dollar budget and start cutting columns cutting these categories on the app that you don't need and to say and lowering dollar amounts we're gonna hit this truck we're gonna hit this truck and the great thing about every dollar is it's going to show you at the top what's left and so you're going to find some margin julian you really will and you're going to start to see that number grow grow grow and you just think if we put that much towards the truck this is where and you start to actually see it happening

but you got to see those hard numbers first and foremost so go back a few months and average out some of these categories and i think that's really going to help you see somewhat of a goal to shoot for i think as you get good at this and it's going to take you a little bit to get good at it you're going to put three thousand dollars a month on the truck and the truck is going to be paid off in about 10 months that's what i think okay so here's your here's your rules you and your husband sit down turn the television off put the kids to bed get the every dollar app up on the screen and start telling june what to do you guys get to choose together what it's going to do. You lay it all down, and then you stick to the plan that you laid out.

The first month, you're not going to be very good at this. The reason you called us is you suck at this, and you're learning. The second month, you're going to be a little bit better. The third month, you're going to be a little bit better. The third month, you're going to feel like a budget pro. It's going to take three months before it all clicks. Okay. Okay. Give yourself a little grace.

It's tense to sit and talk to your spouse about this when you never have. Expect some tension in the area. Give yourself a breathe, breathe, okay? Smile, tell a joke. And so, you know, begin to lay it out. And every dollar has an assignment before the month begins. And it's not going to be perfect the first month. And we're going to do it together, and we're going to have a contract between the two of us

that we're not going to violate this plan that we have both agreed to without coming back and changing it together. You might have to change it a time or two. Yeah, you probably will change it throughout the month, so give yourself that leeway, but you guys agree on that. You have to agree on it. You can't just come in and go, honey, I changed it today. No, that doesn't work that way.

Okay, we're going to do it together it's very very important when you do that you're going to feel the stress and the anxiety and the relationship leave the air as well as this sense of out of control and chaos it's amazing how powerful this one simple tool is. This is The Ramsey Show. Our scripture of the day, Romans 12, 2, do not be conformed to this world, but be transformed by the renewing of your mind, that you may prove what is good and acceptable and perfect will of God. Andy Warhol says, they always say time changes things, but actually you have to change them yourself. Kelsey is in Indianapolis. Hi, Kelsey. Welcome to the Ramsey Show.

Hi, Dave. Thank you so much for taking my call. I appreciate it. Sure. What's up in your world? I'm going through a divorce right now. In the past year, since August, I started my first full-time job, saving up for me and my little girl.

And I have currently saved, since August, a little over $15,000 in cash. Good for you. I have no debt, no credit cards. It's funny. This old man said to do baby steps, and guess what? He was right. So I don't have any legal obligations or anything as well when it comes to divorce. My question is, with the cash that I have set, it's currently in a share certificate, which will mature in September and when it matures it'll be around $20,000 if not a little more. My question is I know you prefer people to save up for 20%

on a home mortgage but as of right now where I stand legally and with no two years of W-2 I'm not able to find a co-signer on an apartment or qualify by myself for an apartment. I'm not able to find a cosigner on an apartment or qualify by myself for an apartment. I'm currently living with my family. It's not the best emotional and verbal situation. I've been here during the three years of this legal separation and divorce. So my question is, is it okay if I put 10% or 15% down, which would be the $20,000, and get a home and have a payment that's roughly $1,200 a month. Kelsey, if you can't qualify for an apartment, you can't qualify for a home.

So your logic is broken. But to answer your question, if you have an emergency fund of three to six months of expenses plus a down payment of 5%, 10%, sure, go ahead and buy in that case. That's all fine but you're and yes you do need to get out of there but there are plenty of places in indianapolis that will rent to a person who has twenty thousand dollars in the bank that does not have two years of w2s lots of them you've been told a lie by someone because we regularly survey the apartment community. George Campbell did one not long ago for his podcast where he called around to different apartments in different cities and said, I have a zero credit score. I'm brand new out of college. I don't have a job track record, but have a job i can prove the job to you

um will you rent to me and they said sure some of them required a little larger deposit but every one of them except one said no fico score is fine and not two years of w2s all of that is the so someone's telling you this, and it's not true. Okay. I've put in three applications for apartments and been denied every time. They need a co-signer. Well, what happens, too, Kelsey, so what we have found, though, is sometimes you have to call and actually ask for a management position,

someone that has a bandwidth to be able to or have decision making rights that the person in the front office who may just be going through the applications doesn't have so we do we have found that that you have to find you don't just fill out applications blindly go in and sit down and talk to them say here's the situation okay i went through a divorce i've been working i'll show you the w-2 for what i'm doing i show you proof of job and uh and here's here's my certificate i've got fifteen thousand dollars in the bank and um they'll rent to you they'll rent to you but if you just turn in applications they'll just turn them down because they don't even look at them but if you're in a position to buy a home and you do have that down payment and that payment's no

more than 25 of your take-home pay you have your emergency fund and you have all of that set up i mean at that point i would i would go ahead and buy i mean we always say to i'm not sure you do though because i don't think twenty thousand dollars is an emergency fund plus a down payment do you kelsey no it's not i do have three to six months expenses saved outside of the oh you do okay then twenty thousand is fine okay what are you making how much are you making percent how much are you making um monthly with the child support and my own together it's a little over 3200 a month okay all right i would buy now here's the thing um we do not want to we tell you never take out more than a 15-year mortgage we tell you never do it where the payment's more than a fourth of your take-home pay. We do say those things.

But we do not say the third one is 20% down. We say 20% down is best because you avoid PMI. But a first-time homebuyer or someone in your kind of a situation where you're trying to re-enter the housing market for the first time or re-enter it as if it's the first time. Very few of those people put down 20%. Okay, so I'm okay. I'm not going to get spanked by Papa Dave.

I just told you. You can do it. That's funny. Okay. That's funny. Kelsey, that's exciting, though. I mean, seriously, this feels like another great step in the right direction for you don't do it based on there's no apartments in indianapolis that are rent to you because that part's not true yeah okay that part's not true so because it literally i mean you think an apartment

won't rent to you but you can get a mortgage i mean come on that doesn't even make sense so um yeah sit down with churchill mortgage and they'll help guide you through the process we've been endorsing them for gosh almost 30 years now and they'll help you figure out what you can afford and you know start to lay out and then you might you may decide to save a little bit more and go get you an apartment and get out of this toxic family situation but i think you do need to get out of that you've gotten far enough the other side of the divorce to recognize there's other things that are toxic that are bringing you harm and you need to separate yourself from that or at least get some distance from it anyway and yeah I think you do need to make that move Michaela's with us in Minneapolis hi Michaela

welcome to the Ramsey show hello hi what's? So essentially I'm calling because I just graduated. Um, and my husband and I just have kind of decided to sit down. We, you know, had conversations about our finances in the past, but really just taking it seriously. And there's quite a bit of debt. I'm not really sure where to start. A little over $686,000. On what? Mortgage. How much of this is mortgage? $350,000.

You have $300,000 in non-mortgage debt? I have my doctorate. And what? My student loans were about chiropractic. Are you working now or you just graduated? Not. I just graduated about a month ago and I'm currently not working. We have a toddler and I'm also, we're about to have our second baby. So I'm staying home for a little bit for that reason. Oh man, girl. And you signed up for $200,000 to be a chiropractor.

Wow. Yeah. What does your husband make? I kind of, so he, it kind of varies. His income is based on, like, his sales. Yeah, what's he make? So I don't really know like yearly um like his last you know it roughly estimate about six thousand a month but it totally varies like some months it's as

high as like ten thousand a month you're probably making eight you're probably making eight or ninety thousand okay honey you're gonna have to get to work you painted you painted yourself in a corner you don't have a lot of choices i I mean, you have a baby, I understand, and you should do that. But you're about to be a chiropractor because you spent $200,000 and you've got to pay $200,000 by being a chiropractor. You made that decision. You can't unring this bell. So you're about to be a chiropractor,

and you're probably going to start at $50,000 to $70,000 a year. And if you work your butt off, maybe you can get it up to 110. And between the two of you, then you're going to have to get in attack mode and get after these debts. Yeah. Wow. Let's do this. Let me help you.

You've got a baby on the way, and it's a scary time, and this is an overwhelming amount of money. You may not be able to keep this house, and you may not be able to keep the cars you bought too uh you guys have made a real royal mess and it's going to come it's there's going to be some pain involved before you turn this around probably some chiropractic metaphors in this so um but um hang on. We'll have, who's in there? Kelly's in there. Pick up and get you, I'm just, get you Financial Peace University and help you two get started. And we'll try to help you with this.

And you call us back if you need help as you go. That puts us out of the Ramsey Show and the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. Hey, folks, Dave Ramsey here. You know, budgeting doesn't have to be boring. You just need a budgeting app that's made with you in mind, and that's EveryDollar.

The EveryDollar app has helped millions of people work the baby steps and take the stress out of planning and managing their money. Start budgeting with EveryDollar for free right now. Just go to RamseySolutions.com slash EveryDollar and download the app today. That's RamseySolutions.com slash EveryDollar.