The Ramsey Show - Why Debt Is Never the Solution to Your Problems

Episode Date: April 25, 2024

💵 Sign-up for EveryDollar today - The simplest way to budget for your life! Rachel Cruze & Ken Coleman answer your questions and discuss: "Should I use debt settlement?" "Where does a HELOC fall in the Baby Steps?" "I don't have anything saved for retirement," "How do I navigate buying a house from family?" "Is it ever a good idea to get a prenup?" Support Our Sponsors: Churchill Mortgage Zander Insurance BetterHelp Next Steps 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 🏦 Take Your 3-Minute Money Assessment - Get a personalized money plan! 🍎 Enter the Teacher Appreciation Giveaway 🏠 Find a Ramsey Trusted Real Estate Agent 🎟️ It's game on! Get your ticket for Total Money Makeover Weekend.  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, this is The Ramsey Show. It's where we help you win in your life. We want you to win with your money, win in your work, and win in your relationships. The phone number is 888-825-5225. 888-825-5225. 888-825-5225. I'm Ken Coleman, and I'm privileged, proud, ecstatic to be joined by the graceful, the one, the only, the inimitable Rachel Cruz. Thanks, Ken. This is a special day, not because I'm with you in studio.

And it's always a special day to do the show with you. But it's your special day. It is your birthday. And America wants to say happy birthday. They told me. And so I am on behalf of the American people saying happy birthday to Rachel Cruz. Are we allowed to tell people how old you are? I guess. I don't know what people how old you are? I guess.

I don't know what age you get to that you're like... I know how old she is, but I'll leave it up to her, folks. I'm 36. Oh, whoa. She's almost an adult. This is exciting. Almost. You're almost there.

Not quite there. No. I am the spring chicken of the bunch when it comes to here. You are the youngest. As the host. Are you the youngest Ramsey personality? I am. Even George oh gosh George no I am older than George that's awkward you only co-host a show with him smart money happy hour I'm a you know what I think we oh gosh George I think we I think we graduated the same year okay but I think he's a little bit younger he's

a year younger than no he's a year younger than, no, he's a year younger than me. We graduate, I was a year older than him. Big plans tonight? I'm heading to Atlanta, Ken, for. A book signing. My last book signing tomorrow in Atlanta. As fate would have it. Yes.

It's a book program. I'm glad for where I am. Yes. Children's book. Yes. Tomorrow from one to two, I'll be at the Barnes and Noble. Where? In Alpharetta.

Yeah, I know that one. Mercer Crossing, is that right? Over near North Point Mall. Yes, possibly over in there, yep. But from 1 to 2 tomorrow, Atlanta. Yeah. Come hang out. We'll be doing a story time and the kids book.

It'll be the last stop of the book tour. Yeah, and for those of you that are planning to come or now want to show up, bring a cupcake. Rachel loves chocolate, and we'll keep celebrating her birthday the day after. So it's very fun. So it's exciting. You know, I feel, James, I dropped the ball as her co-host and co-worker and friend for many years. I feel like I dropped the ball. I should have brought a small cake.

Oh, and just given us a great acapella. I'll make some calls maybe for hour two, hour three. We'll see what I can pull off. And I need a happy birthday song from you, Ken Oh, I'll sing I know you will You actually have a pretty good voice Maybe going out to the break, I'll sing happy birthday to you

We'll see America wants to hear that, so stay tuned But first, Maria is joining us in my old stomping grounds Where I went to high school, Rachel Virginia Beach Maria, how can we help? Hi, happy birthday, Rachel Oh, thank you, Maria You're welcome Maria, how can we help? Hi. Happy birthday, Rachel.

Oh, thank you, Maria. You're welcome. I have a $12,000 credit card debt that is on an emergency low rate of 3% until November. And I am considering debt settlement for that credit card so that I can pay a lower amount in a lump sum. And I wanted to know if you recommend debt settlement. Well, what was the debt from? From my previous marriage. Okay. Was it your debts together? Was the credit card under both of your names?

Yes, it was debt together and we are getting divorced. So that's what I ended up with. Okay. Because the credit card is under my name. Because it was under your name. So yeah, it's going to you. Okay. So here's the thing with debt settlement.

And usually when your debt goes into collections, meaning if you don't have the money, because I'm assuming you don't, do you have the money to pay this? I don't have $12,000. I've been making the minimum payment so it won't go into collection. Okay.

And yeah, so it's not in collection, but I can pay just the minimum. So with the debt settlement, usually with these companies, Maria, there's a lot of fees. There's a lot of twistedness that a lot of people did. They they get in a position where it ends up harming them more than it hurts or ends up harming them more than it helps them. And honestly, Maria, I mean, at this point, you know, my goal for you would be able to pay this off, even if it is paying minimum payments at a time, and then start working your way to putting more money towards this every month to become completely debt free? Because the debt settlement for you, is it just because,

I mean, why don't you want to just pay this off over a period of time? Well, I don't, I have a low income. So I'm starting all over. I'm 56 and I have, so I'm just trying to figure out how to start all over. Yeah. And this debt is making me anxious. So I can collect some money. I can get some money to pay the debt. If the debt settlement is not going to harm me that much. I know it has some negatives.

Um, how much do you make a year to try to do that directly with the bank? How much, how much do you make a year? 32, 32,000. What do you do? Administrative work. Do you have kids? And I'm going to school. No, no, they're adults. What are you going to school for? My undergraduate degree.

Yes, in what? What are you pursuing the degree for? Oh, in what? Management. Okay. So, why don't you quickly outline for us, because I want you to understand the negatives, and you understand there are negatives to the settlement. What are they specifically for you? Well, it affects the credit. Of course. I know that it affects my credit.

Not a big deal there. We'll explain that. Keep going. And also the fees that have not been disclosed to me. Exactly. Yeah. So what ends up happening in these situations, Maria, a lot is people in your situation, they will contact the debt settlement company. Again, and I don't want to say easy way out because I know you're in a really hard situation, so I'm not saying that phrase flippantly, but really hoping that this is the thing that's going to help them get out.

And then what ends up happening is they put you on some type of payment plan. There's a lot of fees. You can't keep up with that. And if you're back behind, sometimes they'll end up charging you back interest as well. It just becomes this spider web that's all tangled and it sometimes does not pan out the way you think it does so if anything maria i almost would contact um who's the credit card with what bank it's with a credit

union okay well that's good because at least credit unions those are better than big national banks because you can actually talk to a person and i almost would just go down and and tell them your situation show them your income and just say hey i'm not going to be able to pay this off for a really long time and if i'm able to get together and see if you can do some type of settlement even with them versus having to use a middleman because these middleman companies, I just don't trust them yet. I just, I feel like we've heard so many stories where the person in your position ends up getting screwed up, you know, and you end up in a worse situation. And so if anything, I would keep the minimum payments, don't get behind, see if you can up your income and see how, you know,

map out how long it would take for you to just pay this off. But I would go down to the credit union, have a meeting and tell them your situation and see if they can help you out instead of using a middleman. Yeah. And Maria, even outside of that advice, you need probably a second job right now while you're getting trained in school to get a much better job. A second income, even if it's 20 hours a week, would really give you some margin that you're going to need. Don't move, folks. We'll be right back. This is The Ramsey Show. Buying your first home is a big deal and sets the stage for your financial success. So work with a mortgage advisor you trust, not just some random website. Churchill Mortgage

is Ramsey trusted because they help you avoid hidden traps and expertly guide you through every step. Learn more at churchillmortgage.com. This is a paid advertisement. NMLS ID 1591. NMLS consumeraccess.org. Equal housing lender. 1749 Mallory Lane, Suite 100.

Brentwood, Tennessee 37027. The Ramsey Show continues from our headquarters here just south of Nashville. I'm Ken Coleman. Rachel Cruz joins me. And we are here for you this hour, America, 888-825-5225. Boy, oh boy, we've got a great event coming up. And I can't believe it's right around the corner. May 10 and 11 are the dates. The event is Total Money Makeover Weekend. This is an entire weekend, so a great destination event. And it's going to be held right here on our campus in our beautiful conference center.

What are we doing? Well, you could guess with the name of the event, Total Money Makeover. It's the basics. And we're going to help you with getting out of debt, creating the budget, easing your anxiety around money, investing, how to make more money. What does it take to be wealthy? It's going to be a great, great event. We're going to have live, interactive Q&As throughout the weekend, not just the talks. All of the Ramsey personalities there, and the tickets are going. Move quickly, excuse me, to RamseySolutions.com slash events. RamseySolutions.com slash events. All right, let's get back to the phones. Kyle is joining us now in Indianapolis, Indiana.

Kyle, how can we help? Hi, guys. Thanks for taking my call. You bet. What's up? Yes, so my quick question is I'm wondering if I should go back to school for an MBA or I'm really just trying to increase my income because I'm trying to move out of my fiance's parents' house. All right. So walk me through the direct line that you see between this MBA and

you making more money so you can move out. I guess that's kind of my struggle is there's not a whole lot of direction. So let's walk through this a little bit more. Okay. How long would it take you? Goodness gracious. I apologize, America. You just gave me a swig of water. I tried to help. And it did it again.

Did what I could. Been talking all week at Entree Leadership Summit. The voice is tired. Kyle, how long would it take you to finish this MBA? Whether we know what we're going to do with it or not, let's just walk through the timeline. How long would that take? Probably roughly two years, I'd guess. Yeah, that's not helping you get out of the house quicker.

Yeah, and how much would that be, Kyle? Yeah. Have you looked into programs? I'm seeing if I would, I probably wouldn't go unless if I got substantial financial aid. Right. All right, so let's talk about what needs to happen. Just bottom line, what needs to happen so that you can get out of this place that you're living in? What needs to happen?

I'm making, I think we're close to $4,000 a month combined. And rent, that's kind of, as far as the quarter of the take-home pay, that's kind of $1,000 is like the minimum you can get here. So wait, combined you and your fiance are making 4,000 a month. Yeah. So now what do y'all both do? What do you do? Yeah. What do you guys do? Um, I drive a right now, and she works part-time in school. Okay, so it was a trick question. The answer to my question is you guys need more income. You don't need a degree.

And you're in a situation in an economy in the Indianapolis area, very strong job economy right now across the country. You're driving a bus making how much per hour? About $25. Okay. So she's a part-time because she's in school. So does she have any bandwidth at all to actually work beyond going to school and doing the part-time job? A little bit. A little bit. Okay. So we need to determine what a little bit is. And is she picking up? Is that 10 hours, 15 hours?

That's what she does. And then for you, um, you know, 25 an hour, not bad. That's a really good hourly rate. That's a pretty good hourly rate. So you got to pick up a side job, uh, you know, some type of maybe a gig. Are you 40 hours a week, Kyle? Um, I just recently started picking up about 40 hours. About 40 hours? Yes, it's just under. Okay, so we got to get better jobs, and you don't need an MBA to do that. We need a second job. You don't need an MBA to get that. You just don't. And so what is she going to school for? She's going to school for

to be like a physical therapist. Okay. And how long does she have left in her undergrad? She's one year away. One year away. And then what comes next? Because there's more schooling, is there not, for the PT? Well, I think she, or I guess it's physical or exercise science, so I don't think it's necessarily a therapist. Is it her undergrad? Yes. So then she has to go on to PT school then if she wants to be a PT. Yeah.

Okay. All right, so you see where we stand here? We've got a series of decisions that we're going to have to make to allow us to live. And we're going to have to live on way less than we make while we're in this season, her season of getting educated to be able to be a physical therapist. So for you, you're the one with a little bit more freedom here to make some decisions. So if you're driving a bus and you're getting paid 25 an hour, my first question would be, can I drive for UPS? Can I drive for Coca-Cola or drive for a beer company

where potentially I'm making more per hour? I don't know, but I'm going to look into that to go, I've got this qualification here. It'd be an easy move for me to work for a bigger company where I've got some room to grow. I know that, I know a lot of guys start out, will be driving for like one of those soda companies or a beer company. They put their time in and then they work their way up into management. So you've got to start to take the future really serious right now while your fiance is taking care of her future. And so we're going to have to make some more money to be able to afford the rent, or we're going to have to live some more money to be able to afford the rent

or we're going to have to live somewhere further away than we want to live. That's also the reality. And I guess one question is because I have a business administration degree, but when I was doing it, I kind of was just going through the motions and didn't really retain anything. So I'd like to reuse my degree, but I really don't have any direction on what I can do because I feel underqualified. Well, you're underqualified because you've never done anything. Yeah. It's more experience, Kyle, honestly, especially with

a degree that's more general like that. Getting in the field and actually doing something, that's going to teach you a whole lot more than probably sitting in those classes i'll be honest and i'm not trying to knock education but there's a truth that like i mean unless you're going to like pt school to actually like you know know tactically very specifically what you're doing but like you know a comm major or a business to a degree you'll get some accounting classes you'll learn some stuff and the basics but the how things really function in the real world is going to come from that experience of you actually getting in there. And you'll start at a very entry level.

You know, I mean, like you won't be high up, but as you start, again, having that experience and then slowly moving up, I think is really key. Kyle, what would you do? What would you try tomorrow if you knew you couldn't fail and it was going to give you a nice bump and you didn't have to commit to it was going to give you a nice bump and you didn't have to commit to it for the rest of your professional life but you go i've been wondering

about this i think i'd like to do this if i knew i could succeed what would you choose tomorrow i i mean i'm really passionate about personal finance um okay but but what it i feel like i would have to grow my own business. Not true. Not true. So to dovetail off of what Rachel just said, she's absolutely right. You should go on RamseySolutions.com and look at the Smart Investor Pro section. These are financial professionals, personal finance professionals.

They're in investing. And you should just see who's listed in the Indianapolis area that is associated with Ramsey Solutions. They run their own businesses. They're qualified. They know about everything that we teach, and if you were to just find out who's in your area, and I'd start figuring out if you knew anybody that worked over there, or you knew somebody that knew somebody, and I'd go take somebody to coffee, one of those pros. Take them to coffee or lunch, buy their lunch. Everybody's favorite topic is themselves. Be interested in how they got where they are, what they would recommend to you about potentially a career in that way. And that right there is going to help you remove some of the unknowns,

which makes this feel so intimidating to the point that you said, well, I'd have to start my own financial firm. Not true. I'd rather you get paid to actually learn the business. And that's how that works. There's tests and licensing that you'll get over time. That's my advice to you, but hang on the line. I'm going to give you the new book. It's called the Get Clear Career Assessment. Find the work you're wired to do. Take the assessment, read the book. It's a 45-minute book and about a 15-minute assessment process just to verify what is it that I'm wired to do. It's going to really help you. Hang on the line. We'll give you that, but please do what I told you to do and go talk to people who are doing the thing that you think you might like

to do. It'll help you a lot. Thanks for the question, Kyle. Thanks for the call. Don't move. She's Rachel Cruz. I'm Ken Coleman. This is The Ramsey Show. I've been doing this show for over 30 years, and some of the saddest calls I have taken are from situations that are completely preventable. Yeah, and what's so hard is I feel like one of those, especially the ones that I'm like, oh, it's terrible, are people that call in and their spouse has passed away suddenly, and they don't have life insurance. When you have to think through how am I going to pay my bills in the middle of all that grief, it's terrible. So life insurance is the one thing, especially as a mom with three little kids that

I'm so big on for people to get because it's inexpensive. Zander is the place that Winston and I actually get all of our life insurance. And it doesn't cost much because Zander shops among a gazillion different companies. It doesn't cost much. You just have to admit that someday you're not going to be here. You got to say it out loud and you got to say, I'm going to say I love you to my family by taking care of them and taking the time to put this stuff in place. The cost of stinking pizza. To get a free quote, call 800-356-4282. That's 800-356-4282 or go to zander.com. Welcome back, America. You're joining the conversation about you with you here on the Ramsey Show.

I'm Ken Coleman. Rachel Cruz joins me. Thrilled that you're with us, 888-825-5225. Let's stay right here in Nashville where Ryan joins us. Ryan, how can we help today? Hey, guys. Thanks for taking my call. I just have a quick question. Pretty new to the Baby Steps. We're in Baby Step 2. All we have left is our mortgage and a HELOC. Would you treat the HELOC as just a part of Baby Step 2 or would

you treat it differently? It would be part of Baby Step 2 if it's less than half of your annual income. So how much is the HELOC? It's $17,700. Okay, how much do you guys make a year? I make $53.50. Okay, so yeah, I would put that in Baby Step 2. I would just go ahead and, yeah, act like that's just a consumer debt.

Yeah, if it was more than half of your annual income, if it was, you know, $40,000, then I would roll it over to Baby Step 6 and even look at interest rates and possibly even refinancing and putting it all together. But for you guys, I would keep it separate, yeah, and just work on that as Baby Step 2. Do you guys have savings? Yes, we have $7,000 in savings. Okay, that's awesome. So great. So yeah, honestly, I would throw a chunk at that. I'd keep $1,000, throw $6,000 at this. You guys will have $11,000 left to pay it off. And I would pay it off as quickly as possible

so that you guys can get back to saving and investing and all that. How old are you guys? I'm 30 and my wife is 29. Okay. That's great. Yeah. I mean, you have time, but I would still be pretty, pretty aggressive towards this because you guys can knock this out pretty quickly. Yeah. Yeah. And I have a side hustle that also makes about between 10 and 20. We just had a kid, though, so I have to be kind of limited with that. But I guess navigating and I would just take the side hustle money and instead of saving it, just throw it right at the heel. Yep, that's exactly what I would do for sure. And then any extra money you guys have that you can squeeze out of your budget

and live on nothing and see if you can even throw an extra, you know, $6,000 this year out of your regular income at it as well. Okay, okay. Awesome. Thanks, Ryan. Yeah, thanks for the call. Congrats on the little one. Yes, absolutely. Chris is up next in Harrisburg, Pennsylvania. Chris, how can we help? Hi, thank you for taking my call. So I just had a quick question.

I know that you guys have talked about being upside down on loans and taking out personal loans to cover the difference. My situation is a little different. So I owe money for taxes. And I was wondering if I could take out a personal loan to cover that to prevent any further like penalties. Yes, I would. How much do you owe? It's about $3,600. Okay. Are you able to pay it off pretty quickly? Do you have any savings? No, we just started doing the baby steps. So I only have, or my wife and I, we only have $1,000 saved up and that's all we have right now. Okay. How much do you guys make a year? I make about $55,000. My wife, she doesn't currently work, but we are moving in a place that she can work part-time. So that's expected the next couple of months for her to get another job.

Okay. When's the tax bill due? It doesn't say on the note that they gave me specifically. We just filed our taxes and then we got this notification a couple of weeks afterwards. It just gives me the total amount that's due. Yeah. I'm just curious.

I've never had this happen to me. So I'm just curious how much time. I'm sorry. I misspoke. It says May 19th, 2024. Okay. Now here's where I'm going because I would try to come up with as much cash as I could. And so I'm thinking, how much can I sell? Can I sell $1,000 worth of stuff in my house? Can I

find stuff in my house where I could come up with $1,000? I'm just trying to give you some ideas here, because I'd like you to take a big chunk out of that. You've got until May 19th I wonder what what side work you could come up with could you come up with $3,600 between selling stuff and just working like a mad dog until May 19th that's what I would try first yeah I mean I would do as much as I could yep I mean Ken's right but past that date I don't know just the IRS and stuff I'm like no I'm not saying I'm just saying up until totally I mean you can you can pay the thing on the 19th. If that's what they say, I would be working and making as much money as possible to pay that off. Yeah, for sure.

But if it goes past that date, then I would be okay for you to take out a personal loan just to get the IRS out of your life. You definitely want to do that. But Ken's right, Chris. I'm like, yeah, it's $3,600. I mean, if it was $15 was fifteen thousand this would be a different conversation of the of the intensity but if you guys can come up with this do you have do you have other debt yes i have student loans and that's about twenty six thousand okay okay chris what do you think you could come how much money do you be aggressive here how much money you think

you could come up with between now and may 19th, between working and selling stuff? I think we could come up with a little bit of it. I'm actually in the National Guard, so I'll be leaving for my annual training during most of that time. And so my wife will be with the kids. Oh, I see. That's tough. I'm putting the damper on us trying to get a second side hustle between now and then.

What about selling stuff if rachel and i came over to your house this feels like a potential reality show that's okay good and we came over we just started walking through the house could we come up with fifteen hundred dollars worth of stuff maybe five hundred dollars all right i'm just saying five hundred dollars is no joke. I'd be selling everything. But I will tell you, I say this, it's a little easy for me because Stacey's the queen, Rachel, of selling stuff on Facebook Marketplace. I mean, queen. It's fantastic. There's always that meme that's like, I'm going to get murdered at my house for $4.99 for a pair of shoes and the stranger comes no i gotta i gotta defend stacy's honor on this one she's always we're meeting people

in the kroger parking lot oh oh even better let's go because you know how i know this i'm the delivery boy stacy sells it you know you're gonna get murdered not not a kroger hey you never know well you're not listening to some true crime podcast ken here i am trying to help chris and millions of other people now you just freaked everybody out don't get murdered chris but see if you can sell some stuff get some cash and yeah i mean the most i mean you know make it a goal because i mean 3600 bucks in three weeks i mean i get it like that's like okay a little steep um but see if you can cut that in half, like at least have a goal to get you somewhere. Cause that's part of it, Chris. And you guys said you just started the baby step. So you're going to feel this like intensity and

there's a change that's going to happen for you guys. And you're just on the verge of it. You have your thousand dollar emergency fund, which is awesome, but you're going to do things that are uncomfortable and that are, you know, odd to you possibly that feels so weird because you haven't done it before. Right. So I would push yourself to have a goal to say, hey, let's try to only take out a two thousand dollar loan, you know, by May 19th or whatever, you know, something realistic, but also aggressive. Right. I mean, really get in there. And we're joking about the selling stuff. But for real, go look around. And even Uber, I'm like, maybe you drive Uber for a few nights a week. And you're worried about me getting killed in the Kroger parking lot,

and you're going to pick up perfect strangers? I don't see the difference. I don't know. I feel like Uber's more dangerous than that. I'm kidding. Possibly. I don't know. I don't know if I could jump through some hoops.

When was the last time you sold something online to a stranger? I'm not going to lie. Never? I don't. Winston has. I don't know if I have because here's the deal for me. It's not worth it. I'm like, I would go to a consignment sale before I would sell stuff on Facebook.

And not that it's a bad. I mean, you can do it. Or I'm just going to go and donate it. Oh, we do a lot of that, too. Yeah. But I don't know. I'm bad, I mean, you can do it. Or I'm just going to go and, you know, donate it. Oh, we do a lot of that too. Yeah. But I, I don't know. I'm like, I just don't, I don't know. I don't have the energy.

I've never thought. And I'm not detailed with it. But Winston sells, he'll sell stuff. And I'm like, babe, just throw it away. Like that's like. Right. He's like, somebody will take it. And I'm like, I mean, I guess.

I'm like that too. It's funny. It's Stacy. Winston for you, it's Stacy for me. Sometimes I'm like, why are we doing this? Because I Stacey. Winston for you, it's Stacey for me. Sometimes I'm like, why are we doing this? Because I just simply don't want to drive to Kroger. I'm really comfortable watching golf right now. I don't want to get up.

It's that kind of thing. Because it's odd hours. For $15 or whatever. You've got to meet so-and-so. And you're just like, oh. Yeah, I get that. Trust me. But for people who really, you know, you need to scrape every penny together.

Oh, sure. I mean, if you're in a season of sacrifice. Our friends at The Min who really, you know, you need to scrape every penny together. Oh, sure. I mean, if you're in a season of sacrifice. Our friends at The Minimalist, they could tell you. There's thousands of thousands of dollars in people's homes. That is so true. Yes. That's all I'm saying. If you hadn't come up with money quick.

TVs. I mean, just, yeah, all of it. And if you're really worried. Porch furniture. Hire an armed guard. Give the armed guard a little bit of a piece of the sales. Like, hey, I need you to come with me to this transaction. We're trying to lower expenses, Ken.

I know, but you scared America, so now we're trying to meet them in the middle. All right, we're having fun. I hope you are, too. Don't move. We'll be right back. This is The Ramsey Show. This show is sponsored by BetterHelp. This is the season for Halloween. It's October. We're wearing costumes and we're wearing masks. If you haven't started planning your costume yet, get on it. And while you're thinking about it, I want you to be honest. A lot of us hide ourselves. We hide our true

selves behind costumes and masks all the time. We do this at work. We do this around our friends. We do this around our families. We even do this when we look at ourselves in the mirror. I know because I've been there multiple times in my life and it's the worst. If you feel like you're stuck hiding behind masks and costumes all the time, if you find yourself hiding from your true self, I want you to consider talking with a therapist. Therapy is a place where you can be honest, where you can talk to somebody else and reflect and learn, and you can accept all the parts of yourself over time and start living an authentic life. Masks and costumes should be for Halloween parties,

not for our emotions and our true selves. And if you're considering therapy, try calling my friends at BetterHelp. BetterHelp is 100% online therapy. You can talk with your therapist anywhere, so it's convenient for you and your schedule. Just fill out a short online survey and you'll be matched with a licensed therapist. Plus, you can switch therapist at any time for no additional cost. Take off the costumes and take off the mask with BetterHelp. Visit

betterhelp.com slash deloney to get 10% off your first month. That's BetterHelp.com slash DELONI. Welcome back, America. You're joining the conversation about you with you, your life specifically here on The Ramsey Show. I'm Ken Coleman. Rachel Cruz joins me. By the way, America, today is Rachel's birthday, and we're just celebrating her the entire show.

I mean, there's so much to celebrate. Thank you, Ken. Big, big, big plans tonight. You're flying to Atlanta. I'm going to drive. Oh, you're driving. I know. It's a four hour.

It's one of those tweeners. And that's always right on the... I know. And we're going to be in North Atlanta tomorrow for the book signing. You're going to be in Alpharetta. So then I would hate to drive down through Atlanta to get to the airport. Yeah. Because you're already north.

So we're close to Nashville. So I'm driving. We're going to drive. Barnes & Noble and Alpharetta. Yes, that's correct. I know where that is. Marcel Crossing, I think is what it's called. I don't know.

Marcel Crossing. I forgot. One to two. One to two tomorrow. So that'll be fun. She's going to be signing copies of the new children's book, second in the series, I'm Glad for Where I Am. Really fun little book, great message. So if you're in the greater ATL area and you want to brave the afternoon traffic. That and LA, you know, and Dallas. I've picked some traffic-y cities. Boy, oh boy, you got to really love you to get to see you, I'll tell you

that. All right, let's go to Deb, who joins us down at grand rapids deb how can we help hi um happy birthday rachel i had to fit that in thank you so much for taking my call thank you okay i am 62 years old and i have no retirement but i recently sold my house and i have profited $85,000 and it's sitting in savings and I don't know what to do from here. Okay. Where are you living now? So I invested in and co-partnered with a good long friend of mine and we bought my mom and dad's homestead. So I am here and it is covered if something happens to him or me we get the house so that's where that is it's paid for okay okay so you so no mortgage rent nope you're okay um and I'm gonna just assume that all of that was pretty clean you have good documentation on that deal everything is i do but ends up well with that title yeah okay okay do you

work deb i do i work from home i'm self-employed yeah what do you what do you make and um i actually work for a network marketing company and i have for 24 years what kind of income do you make? Now I make $35,000. Okay. How long do you plan to do this? You said you were 62? Yes. What's the outlook? Well, the outlook looks like I have to keep working. Exactly, right? I know, right.

Yeah, and that's not a whole lot of money, even though you've got no house payment. I know, I know. So I, um, I have my car, um, that, that is 15, six that I own it. And in the baby steps, I have my every dollar set up. Thanks to my sister. But one through four, I'm, I'm thinking I need to set it up a thousand, my, you know, six months, right. I, and start investing. That's what I was thinking I need to do. Yes. Yes. Yeah. I would get this car paid off with the 85,000 just so that you have, you don't have a car payment coming out um every month i would keep a thousand there um yeah and then at that point i mean yeah you'll have around yeah 69 000 left so i would figure out a good emergency fund is your is your living expenses pretty low i mean obviously from the

housing perspective it is 2,500 2,500 a Okay. And that's for you to live on, eat everything? It's skinny, but I trimmed out a whole bunch because, you know, I know that I have to be drastic for sure. Yep. Yep. Yep. Okay. Yeah. I'm just trying to do some quick math here. So I would probably maybe put, I don't know, 9,000 away for an emergency fund. So that leaves you 60 grand to start investing. So that's probably what I would do. And again, that's a an emergency fund. So that leaves you 60 grand to start investing. So that's probably what I would do. And again, that's a lean emergency fund. That's only about three, four months. But I think that's okay. I think you're in a, you know, a position right now that you're no one is dependent upon your income, you don't have kids and you know, all of that that you're having to keep afloat. So so I would probably go the three month route on the emergency funds, so that you can put as much

as you can to invest. And what I would recommend, Deb, is sitting down with a smart investor pro. And Taylor and Austin can pick up because we'll get you connected with someone in your area or show you on ramseysolutions.com because they're going to be able to sit down with you and actually figure out, okay, where's the best place to invest? Because when you're looking at investing, there's always the rule of 75. It's going to double every seven years-ish depending on on inflation and interest rates, they're gonna be able to look at run numbers for you, how aggressive, you know, where to put it, how conservative, like they're going to do a good job to map out to see how we can stretch this money and get this growing as quickly as possible.

But I also think the reality, Deb, is and I think you know this, that you will be, yeah, you'll be working for the foreseeable future to get to a point where you have a big nest egg that's built up. Because even 60 grand doubling in seven years is 120. So we want you to be able to, but I think you can do this. I mean, I think it may be another eight years or so, but I would sit down and really map it out. Because thankfully your living expenses are low, and that's the thing's the thing that's, um, and I've got a question about that. That's encouraging. I, I, I thought I heard you say you're moving into this homestead with someone else. Is this right? So I, I sold my really, my nice home that I redid

and it was only 25 years old. I thought I was going to retire there, but it was the only house that was done out of the, I have a friend that we invest with, but we, I have a side hustle with him too, but it's not making anything yet. Yeah, but I'm asking, I thought you said, and I could be wrong. Are you, is this friend moving into this homestead with you as well? Oh no, no, no, no, no. This is my home he has his own here okay so you guys are just buddies we have grown up together neighborhood yeah and you're invested you've invested in some stuff together yep okay and has that panned out where is the rest of that money yeah where's your money gone when you've invested it? What's that mean?

Well, you said I've done some. Go ahead. I'm sorry. So we bought my mom and dad's home when they passed. And then he moved in here and he continued to take care of it and pay, you know, taxes and that. And then I took my inheritance. And then just when I sold my house, I paid the rest of my half off. And then I moved in here and he moved into another house. All right. So I'm sorry to get us on that. I just, I was trying to figure out what,

if there was a relationship situation and here's why. I'm, you know, look at 62, yes, you're going to have to work probably 15 more years. You're already going to be in an uncomfortable situation. I think you're mentally uncomfortable. I think you need to embrace the uncomfortable, and I think you need to look at, what can I do at 62? Can I increase my income to a point where maybe I'm making $60,000, $65,000? Now's the time. And we are in an economy, Deb.

Grand Rapids, I don't know the local economy there. But overall, in the job market, there's a lot of opportunities. And if you could get out of network marketing, and I'm not trashing network marketing, but you've been in it a long time, and you've kind of hit your lid. Okay, quickly, Deb, before we get off here, you said you used your inheritance to buy this.

How much is this property? It's valued at probably $250,000. So that was the other question. Do I sell this? I mean, that's an offer. I mean, you'd have to go buy something in cash because I don't want you, yeah. And that creates more expense for her.

So in that case, yeah, yeah, yeah. I didn't know if it was like a million dollar property or something that I'm like, you saw her inheritance or something there. I'll tell you what. Actually, do you, you know what? One thing I would consider is if you had a girlfriend that you were really close with, you guys are getting up in age, she's single. At some point, maybe considering selling this homestead, invest the $250,000,

and you two split something, and even though you're going to now assume some rent, if it helps you retire earlier, this is all the kind of thing you need to talk to your smart investor for. Yeah, I know. And the rent, the hard thing with that is that it will continue to go up, and I don't want that variable expense into retirement. And she has no expense on this home. Yeah, so at this point, I may stay put, but it's expense into retirement. She has no expense. So at this point I may say put, but I mean, but it's a good point.

I would consider it. Yeah. Float, float all this by your smart investor pro, because they're going to be able to look at even, you know, if there's tax advantages or something, because you'll be able to dip into some of,

well, you don't have retirement. I was going to say some of your retirement, but there's only so much that can, that can happen in the next 15 years. Hold on the line, Deb, and they're going to pick up and direct you on where you need to go to find a great smart investor.

But, yeah, I'm with Ken. I think upping your income is going to be huge and investing as soon as possible, paying off the car and having that emergency fund. I hope that helps. Thanks for the call, Deb. Good hour. Rachel Cruz, I want to thank our fearless leader, James Childs, and our merry band of folks behind the glass that keep us on the air. Thanks to you, America. We do it for you.

This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, this is The Ramsey Show. It's where we help you win in life, winning with your money, winning in your work, and winning in your relationships. 888-825-5225 is the phone number. That's 888-825-5225. I'm Ken Coleman, joined by the incomparable, the glowing, the graceful Rachel Cruz. Why is she glowing? Well, it's her birthday today, and making sure America knows.

She is America's... I'm feeling older and wiser. You know who you are? I'm giving you a new name. Wow. I'm going to give you a moniker, and you can shoot it up or down. This is America's. I'm feeling older and wiser. You know who you are? I'm giving you a new name. Wow. I'm going to give you a moniker and you can shoot it up or down. This is my birthday gift from Ken. It is.

Words of affirmation. You are America's financial sweetheart. Thanks, Ken. I think that's probably true. I'll take it. I don't know anybody else that could knock you off that pedestal. You know? Yeah.

I'm going with it. I'm staying with it. I'm going to say it. Yeah. You like it? I like to be, you know, I'll be stern when I need to be stern, but I'm going to be kind. You're very kind. Yeah.

Very kind. So we are here for you. She'll answer your money questions. I might chime in. I might not. It depends if she lets me. Let's be honest. And I'm here to help you with your work questions because if you're winning at work, you got

a chance to win in your income. You get better. Your paycheck gets bigger. That's what I do. I want to tie that professional growth to financial growth. So I'm happy to help with any of those questions because we need to get more income many times to get through these baby steps, in fact, most of the time.

So that's who we are. That's what we're doing. We're here for you. Randall's up in Birmingham, Alabama. Randall, how can we help? Rachel and Cam, thank you so much for having me. I'll tell you, I'm a long time listener, but this is my first

time calling, and I'm just honored to be amongst you. I had a question. I need some more paycheck in my pocket, like you said. Come on. I think I've got myself in a little bit of a pickle, but my wife's actually, her birthday's actually today as well, and I didn't know that Rachel's birthday was today. Randall, what see my wife's actually her birthday is actually today as well and i didn't

know that uh rachel's birthday what is your randall what is your wife's name her name is vivian vivian happy birthday happy birthday vivian hey april 25th it's not too hot not too cold all you need is a light jacket name that movie i have no have no idea. I don't know. Anyone? Miss Congeniality. We'll get to your question. I promise you Randall's never. She's a little more cultured than I am, I guess. I'm in a little bit of a pinch here.

I didn't quite budget the right way for my wife's gift. She likes nice things. Winston? We've been working the program, and then all of a sudden she wanted this nice gift. So I pulled out kind of this emergency credit card, and I'm a little bit afraid that it's going to ruin the experience for her. Okay, hold on.

What's the gift? Well, it's this purse that she wanted. Now, Rachel's the problem that my paycheck's too small. She starts putting all of her outfits on Instagram, and my wife just goes on there and tries to start clicking on all of them and and so our budget's upside down are you okay Rachel you think this is a prank call are you for real hold on I think I think Randall's for real I'm sorry. I think Randall's for real. I'm sorry. Is she really buying?

Well, I bought a purse for my birthday, Randall. I'm like, there's just too many coincidences right now. You just bought a purse? I got a purse for my birthday. What'd you get? When I was in L.A. What'd you get? A nice purse. She is devout.

She is a devout Rachel Cruz fan. Oh, does she have the Rachel Cruz wallet? She does. Wow. And my credit card is back in the back drawer, and I screwed up. So have you already purchased the purse, or are you thinking about it? Oh, you did? No, I charged it. I'm giving it to her tonight.

And I'm scared she's going to see that bill. Right. Take it back. Right. It's not been Right. Take it back. Right. It's not been used. Take it back. If she's going to be upset that you charged the purse, then she'll be okay if you take it back. Here's the problem.

I can't take it back. It's a really nice purse. No, you can't. No, I got this purse. I had to go all the way to Los Angeles. Okay. Alright, there it is. Randall from Birmingham went to Los

Angeles. This is really good. Happy birthday, Rachel. That's your husband, Winston. I was 50-50. I was trying not to disrespect you, Winston Randall. Wow.

What an honor. Can I also say? That was a really good impression. That's actually good. I didn't know you had ashen chops. Winston has good impressions. Folks. I bet you can do Ken.

Do Ken, Randall. Oh, gosh. I don't know if I can do Ken right now. Let me just say this. I have to be looking at a picture of Ken to do it. Yeah, well, that's true. Hey, folks, America, this is the one, the only, Winston Cruz, Rachel's beloved. And I did not know my friend. I've known you a long time.

I did not know you had those kind of acting chops because you sold me. I was now convinced. Did you know he was calling long time i did not know you had those kind of acting chops because you sold me i was now convinced did you know he was calling in i did not you little stinkers in the booth i i literally thought this was a real randall from birmingham well i was convinced because because he kept he kept going at it now the los angeles thing ah that was that's when i that's when i figured something's boy i'll tell you what. My jaw, my cheek's hurting because of the hook Winston just put in. Winston, that's no joke. That's actually very, very good. And then I started to question.

She sniffed it very first. I went on pretty hard. Yeah, yeah. When you said about the linking, I was like, someone's making fun of me. Vivian is definitely linking. Are we allowed to know what kind of purse this is, or is this private? I was going to get to that part, and I was going to say Goyard. It's a Goyard purse.

It's a Goyard purse. I know what it is. I know. It's a very nice purse, and I'm wearing a Walmart dress with a designer purse, people. That's what I do. There you go. You don't have to justify it with your Walmart dress. I don't know.

It's just a nice purse. Is that really a Walmart dress? I'm distracted. I linked it today. You linked it. I don't even know what that means. No, it was a very nice gift. It was actually his idea.

Vivian already bought it. Vivian. Vivian. Vivian. By the way, Randall and Vivian from Birmingham feels right. I didn't have a job picked out yet or my wife's name, so that was off the cuff. Wow. Very impressive.

We really, you were very confident in the lie. I do have to ask a question now that we have Winston on the phone, because America wants to know this, I feel. Did you suggest said purse, or did he know that you wanted it and he popped for it? I'll let you say that. I have two ears and one mouth. And so they're always listening. Atta boy.

So you knew she wanted it. They're always listening. Yep, yep. And you guys were in L.A. for her book tour together. Exactly right. They don't ship anything, so you got to go in the store and do the dance. There's no e-commerce. Did you take her in there and tell her,

or did you get it and then present it? I said, we're going to Rodeo Drive when we go out there. What did you say? You didn't call it Rodeo. Total Randall fashion. Randall would say it's Rodeo. That's how you spell it. Let's go to Rodeo

Drive, babe. I was like, Winston, don't say that in the store, please. I am so sad that I missed this expedition. Love you, babe. Thanks for calling in. Oh, man. What a prince. What a prince of a guy. He doesn't like doing that kind of thing, but

he crushed that. Boy, I am gullible, James. I was on the hook with Randall until the very end. I need to wake up, folks. I need a cup of coffee. I'll do that on the break. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm Ken Coleman. Rachel Cruz joins me. So excited that you are with us. You know, for decades, Dave has said that your income is your greatest wealth building tool. And to the extent that you can increase your income, then you can increase your wealth. And I'm so thrilled to be a part of the Ramsey

personality team and a part of this great company. And I'm focused completely on that area of helping you make more money. If you're winning at work, you've got a chance to win financially. The more you win financially to get debt-free, to build wealth, the more freedom you have, and everybody longs to be free to live the life they want to live. And so part of that equation to winning professionally and winning financially is to figure out the work you're wired to do. And so I've written a short book called Find the Work You're Wired to Do, and it comes with the Get Clear Career Assessment, which is a self-awareness tool. It's not a personality profile. It's going to measure three things, what you do really, really well, the work you really enjoy doing, and the results that motivate you to actually show up and do great at work.

So it's a combination assessment and book, a fabulous, fabulous tool to help maybe the graduate in your life, high school or college graduate. So you can get it right now by pre-ordering it. It comes out May the 7th. You can pre-order it right now at ramsaysolutions.com. When you do, you get the hard copy and an assessment link, plus the e-book and an assessment link, and the audio book and an assessment link. So it's three books, three assessments, one price, ramsaysolutions.com. And it's a great assessment. We've known multiple

people, even within our family, have taken it. And it's really, really good, you guys. I mean, it's very accurate. Thank you. Thank you very much. I think it's one of the best products that we have, so it's incredible. And the bottom line is this. The reason it's powerful is because you are answering about you, and you get a mirror and you go, okay, now I see who I am, and it allows me to figure out what I want to do and where I can do it. So get that at ramsaysolutions.com. All right, to the phones we go.

Ann is up in Minneapolis, Minnesota. Hey, Ann, how can we help? Hi, yeah, so I'm looking for some guidance and help about the potential purchasing a family home that is in my dad and aunt's name, like the right paperwork or the right way to get the right price and without ruffling feathers. Okay, so what's the situation, Ann? Tell me kind of how this came about. Yeah, so it's my grandma's house. She passed away about four years ago. The house is in my dad and aunt's name. We have been living, me and my family, have been living in the house for the last three years, kind of helping just with snow removal and lawn stuff. And we've been paying not necessarily rents, but enough to cover the property taxes, the insurance, the utilities.

And they're looking at selling now in the next kind of over the summer probably the next two to five months so we're considering buying it from them and just a little trying to figure out yeah yeah um and but everyone when you're saying rough whose feathers would be ruffled because you guys have been living in the property and you're wanting to buy it you You're not expecting it as a gift. So is there other family that may want in on it or? Well, I think that probably my aunt would like to get the most money she can out of it. So I guess agreeing upon. A purchase price is going to be big.

Yeah. Has she floated a number including feelings she hasn't no have you run cops mentioned the area of what it would just sell if they just got a if they just had a listing traditionally i think it would list at like 130 or something we say i think do you how do you know that it? Well, we live in a small town where, like, pretty much all the houses were built at the same time, and they're really similar. Okay. So most of the ones that get listed are between, I'd say, $100,000 to, like, some have been

up to $150,000 if they've been remodeled a bit more than that. Sure. But, Ann, Rachel's making a very key point here. You need to get a real estate professional and maybe two different real estate pros who can come in and run cops on this and show you. And they literally can print this out or email this and say, this is the range based on real real estate numbers, not your opinion. And you're going to need that if you're going to sit down with the ant because you're worried about ruffling feathers. So we're going to take out all opinions here. This is not about opinion.

This is about what the market says the house is, the range for this is. Then the ant, based on that information, she can give you a number. But it should take away all of the weirdness and tension is all we're trying to suggest here. And so now we go, all right, this is the number. This is the range because we're trying to suggest here and so now we go all right this is the number uh this is the range because you're you're going to get a range and then the aunt gets to pick a number and then you guys can go from there but that that's where i'd start yeah is anything owed on the house or is it paid off uh yeah so nothing old and we'd be coming in with enough we plan to pay cash for it you know my husband

yeah so i don't know if that yes we're trying to avoid real estate and that part of it we think would you know if we could all agree we can probably save everybody a little bit of money yeah for sure for sure yeah i mean i would definitely still um have a professional at some capacity because yeah yes yeah yeah do? Yeah. Yes. Yeah, yeah, yeah. Do you know a realtor in your area? Yeah, I know some real estate people. If they start to get involved, they won't just expect that they're the real estate agent,

though you can be pretty upfront about, we just want a place. And this is easier than you're making it. Just if you know somebody and they're a friend, go look. This is all going to be a family deal, but I just need a pro, tell me how to run the comps. And I'll be honest with you, I actually think you can figure this out on your own. I'm not going to go to the wall that I know this for sure, but I think if you go to like realtor.com, which is actually run by realtors, and I'm not endorsing that site. But if you go to a

legitimate site like that, I believe you can run comps on your own. The point is, you just you need to get away from opinion and feelings when you're dealing with family. And it feels like there's already some fear that this could get weird. And so we just need to create a very clear boundary on what this price is is going to land in high, to low, based on real comps. That's what we're trying to get you to understand. Then it takes all the weirdness out, or it should. Great. If we end up not using the real estate in things, are there paperwork aspects? I guess I don't know the next step with that. Yeah, I would probably get a real estate attorney. Yeah, I would probably just get a real estate attorney just um and yeah a couple of hours

of work it won't be that difficult but you just want to make sure that the title and everything you know is transferred properly um i don't think there would be any you know capital gains um at that point if you just write outright buy it from them yeah i mean most of it should be a pretty smooth process so it shouldn't take that much but I would get some legal opinion around it just to make sure that it's great and and again it's a um when it's family like this you know some cases you know it sounds like the aunt's gonna want every little penny she wants and some families you know we talk to and they do kind of a family discount because they want to keep the home in the family you know what I mean so having all of those conversations up front and as non-emotional as possible, because you want to keep the relationships intact.

Right. I mean, like that, that's a that's a goal in this for sure. Yeah. And again, and she'll be able and she'll and she'll come away with some money, which is great. You know, I guess her and your dad will split it 50 50 when you guys buy it for what you get. But I would, yeah, I would get a real estate attorney and pay just a couple of hours probably of their time just to look over everything and make sure that everything is titled correctly and all of that, the deed, everything. So make sure that that's all smooth. Yeah. All right, Anne, thank you so much for the call. Appreciate appreciate that you know it's always best to just remove emotion and opinion when doing any transaction with family yes and certainly in this case a house so because it's emotional as much as people like you know and if it's been it's the grandmother's house right and so um and i don't know their relationship but yeah i like people, there can be some

things that go sideways if you don't do it well. And you didn't have a sense, didn't you feel like maybe she was worried about the aunt? It was the aunt, yeah? Asking too much for it or more than they were willing to pay. And that's the other thing, Ann, you don't want to overpay, or not Ann, I'm sorry. You don't want to overpay for, no, it wasn't Ann. That's right. Overpay for it either.

So if Ann is like, no I want you know, I want to make sure I get $100,000 out of this so we're going to sell it at $200,000 I'd be like, well I'm not your buyer. So you don't get emotional on your end either Ant, even though you guys have been there for three years keeping it up. You want to make a smart choice for you guys too as your family.

Yeah, great advice. Alright. Phone number is 888-825-5225. Quick break and we'll be right back. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm Ken Coleman. Rachel Cruz joins me and we are thrilled that you're here. The phone number to jump in is 888-825-5225. That's 888-825-5225. It's Financial Literacy Month, and one of the ways we're celebrating that is taking questions from students at high schools where our Foundations in Personal Finance curriculum is taught. And today's question comes from a student at Fidelis Christian School. I know that going to college debt-free for your first four years is possible, but is going to grad school debt-free possible as well? Becoming a doctor, for example,

would you still have a large amount of debt? Yeah, I mean, this is a hard one when you get into, you know, being an MD or law school. I mean, it's obviously a pretty penny. I can speak to the law school one. I'll bet you didn't know this. Oh, go. Do you know that you, now I know this is, I don't believe this is true for medical school, but I know for a fact this is true for law school. There are law schools around the country, not the prestigious big name brands, but law schools around the country that if you score high enough on your LSAT, which is the law school entrance exam, you can in in fact, get a free ride. Really? This is an absolute fact.

So you can take the LSAT as many times as you want. It costs you money. I don't recall. Maybe it's $500, $600. I'll check that out. But you can, as it relates to law school, if you're willing to go to a school that's not a big name, by the way, nobody cares. Which we'd probably say to do that anyways.

That's right. That's right. You can actually get a free ride full ride uh based on your lsat score for law school i do know that for sure yeah that's amazing so i wanted to point that out i'm sorry i interrupted no no well i was gonna say because that you know we find it's interesting hearing people's stories where we talk to people that are like yeah, I had my tuition and got cut in half because I did X, Y, and Z, right? Like whether it's like working for a certain, you know, medical group or whatever it may be, there are hoops that you can jump to. It's hard and they're not like out there obvious.

You really do have to do some research. But I think doing that front end work when it comes to a degree that is so high priced, it's worth doing. It's worth looking or it's even worth taking your time through it. You'll be older when you get out, obviously, because it takes a lot of years when you're doing this kind of thing, especially in the medical world. But taking your time because what we see on the show, too, is is is the other end of it. We either see like, oh, yeah, they got a ton of debt, six figures, but they're making good money.

They're gonna pay it off in relatively a short amount of time, two to three years, which is great. But then you hear the calls where she gets pregnant and their baby has special needs and she wants to be home or what. I mean, you have no idea. You have no idea what life's gonna throw you

or something happens to one spouse and they pass away. I mean, like, like we just, we hear every scenario you can imagine. And what happens with debt is you just take on risk, regardless of its school debts, personal loans, whatever it is, you just take on risk. And all of that is really mitigated when you just say, Hey, I'm going to just go a different way. So it is more difficult. I'm not saying it's easy, but I would be, I would be looking all around. Yeah, that's absolutely great advice. All right, to the phones we go, 888-825-5225. Gainesville, Florida, actually, is where Michael is.

Michael, how can we help? Hi, how are you? My name is Michael, like I say. I'm calling because me and my wife, we are looking to purchase a house in the near future. We have around $10,000 in the bank right now. And I was wondering if it would be wise to move that money to the high-yield savings account. Yeah, I would think so, for sure.

How long do you think it'll be until you buy a home? Do you know, Michael? Okay, right now we're able to save around $3,000 a month, me and her. We have no debt. We pay little rent. And I'm thinking saving for a year and see how the markets react in a year from now. But if the opportunity comes before that, at least, you know, my money's not sitting in the bank earning any interest. Yes. Yeah, for sure. Well, I was going to say if this was any time, five years or more, I didn't know what your situation was. I didn't know if you guys were, you know, working your way out of debt or where you were financially.

So, yeah, I would definitely move it to a high yield savings. And I would go online. And what's great about high yield savings, most of that are with online banks. And you can do really easy research to see who has the highest rate of return and do that. My husband and I, we have one in Ally. We have Ally Bank. That's not a sponsored thing, but just that's what we use. And it's great. So with high-yield savings, you do need to know that it is a little bit more difficult to get your money out, just meaning that you have

to usually transfer it online from account to checking account if you ever need to use it. But I think if since you're saving it just for one purchase like that, I think it's, yeah, I think it's a great option. And the rates right now are, I mean, 4 or 5%. It's great. Yeah. I did open my, I did open one a couple of days ago with American Express. It was the one that actually I liked the most. And it's yielding like 4.25% right now. And I wanted to know. I mean, that was a good idea instead of being sitting in the bank, you know? Yeah, I probably wouldn't go through American Express.

I don't know. I would just do an online bank personally if I were you. Online bank? Yes, that's where I would just do an online bank personally, if I were you. Online bank? Yes, that's where I would put it. Yeah, I wouldn't put it with a credit card company. Okay, I understand your point. Yeah. So yeah, look for an online bank, Michael,

and I think that's a really great option. Yeah, absolutely. And congratulations. That's a great amount of savings, and you're on your way. I love how much you're putting away each month as well. So you're going to make some real hay. And here's the other side, and I love what you said, Rachel. The other side to the interest rates, which are much higher, is that you're getting much more for saving. And I think once people realize that the 2% and the 3% mortgage rates are not coming back for a very long time if even

in our lifetime i just don't see that happening if it does i think there's going to be greater economic problems well what's crazy is i think i saw one it hit up to seven percent recently like it's gone up a little bit and uh and i'm like it's wild how our perspectives change so quickly because if it went down to five percent oh we be like, oh my gosh, that's insane. Right? For so long. When it was at that point, it was like, what is happening? It's not at 2% or 3%.

And yeah, it is wild, though. That's right. And historically, 7% interest rate on mortgage is fantastic. And I know people are like, what are you talking about? But I mean, just look at the numbers. It's true. And so, but the good news is, is Stacey and I have a fabulous, fabulous account, money market account, and we're getting

a really nice percentage. I mean, and I'm sitting there going, yay, I love this. So I'm not looking for those interest rates to drop at all. Yeah, on that side, for sure. For sure. And I just think the only reason they would is because we've got a really rough economy. Yeah. Yeah. I don't want to see it dip. I don't want us to get into stag would is because we've got a really rough economy. Yeah. I don't want to see it dip. I don't want us to get into stagflation where we've got inflation going up and a recession happening. Yes. And, you know, we're not far from that. And it could happen.

And so you just don't want to be in that situation. Yeah. And you brought up a good point. So a lot of people have been asking about high yield savings accounts recently because of the high interest rates and money market accounts. So they're both very similar accounts. Usually online banks are great options to go either route, you know, and money market accounts are great. We had that one for, we had a money market account for years. And what's great about that is you get a debit card with it, a checkbook. So yeah, you can make some withdrawals from it very easily out of a money market account. Sometimes you do

have to have, there's a limit of how much you can have in it or even starting out. There's sometimes a higher dollar amount there where a high yield savings, again, like I said earlier, it may take one to three business days to transfer the money from the high yield savings to your checking. But there is no minimum that you have to start with. You can start with a dollar on the high yield savings. So both are great options when it comes to saving long term for sure versus just a traditional savings account. So, yeah. And they're really easy to set up. You guys just go online, do an online bank. And, um, yeah, it's, it's worth it. If your money's gonna be sitting there, let it earn 45%. Yeah. And the thing I like about that is that money, we know it's over there, but it is a bit out of sight and that's also good too. It's like, let's just leave it over there. We don't need to

operate out of that at all. And I think that's wonderful for discipline, too. And it's just, and then stacking, stacking, stacking. I mean, anytime there's surplus on anything outside of our normal budget, it's like, I love stacking the cash. Yes. And that never hurts. You know what I mean? Because, you know, cash is still king. And the discipline there is great. And so anyway, fabulous. So I'm glad you made the point, the distinction between the two, the money market and the high there is great. And so anyway, fabulous. So I'm glad you made the point, the distinction between the two, the money market and the high yield savings. Yeah, because they are very similar.

There's a couple of differences, but not really. That's one question we've been getting so much, Ken, because people are looking and saying, oh my gosh, yeah, the interest rates when you owe suck. It's terrible because they're so high. But gosh, we're making historic on the other end,

which is fabulous. It's a great time for savers. Yes. And saving is always good.'s a great time for savers. Yes. And saving is always good. So good stuff there. All right. We've got to take a quick break. She's Rachel Cruz.

I'm Ken Coleman. You're listening to The Ramsey Show. Don't move. We'll be right back. Welcome back to The Ramsey Show, where we help you win with your money, win in your work, and win in your relationships. I'm Ken Coleman. Rachel Cruz is with me this hour. 888-825-5225.

Lansing, Michigan is where John is waiting. John, how can we help? Thank you for taking my call. Appreciate you. I went back to school less than a year ago at a community college and enrolled there, because I would like to, for the future, get into marine biology. And since that's going to take quite some time to get there, I had another brainstorming idea of, well, why don't I get into nursing? And after nursing, then continue with marine biology, because the way that I look at it, I'm going to still, I'm going to need to keep working no matter how I look at it next year, two years from now, I'm still going to need to be working. And I'm not making ends meet right now.

I'm working two jobs, minimum of 60 hours, uh, maximum about 75 hours per week. And so that's what I'm calling for, that if I choose to go into nursing, would that be a smart career move for the moment to bridge the gap financially in a job that I would also like to? I had two picks, marine biology or nursing. And I'm wanting to know considering it's debt and it's a career a buddy of mine was telling me, well, why are you going to get into nursing? Because

that's just, that's another career that's different from marine biology because of certain job opportunities, it pays more, and it helped me get possibly to that point of marine biology. So what is your take on this? Well, I've got to ask several questions, and then I can give you an opinion.

I'm sure Rachel will weigh in as well. Between the two, if I give you either one and you get to start tomorrow, which one do you pick? Marine biology. Yeah, that's what I thought. And what's the path look like? You know more about that field than I do, so let's play this out. 10, 15 years from now, you're very successful.

What are you doing in marine biology, and what's the range of income doing that? The range of income. No, what are we doing? Give me the ladder. We're further up the ladder. 10, 15 years are now successful. What is that role? Then tell me the range of income.

Correct. The role would be that I would like to see myself on a boat, studying oceanography or fishing, basically environmental, the aspects of that. That's what I would like to be into. However, most of these jobs require a master's or a PhD. A bachelor's, you could get into it, but it's mostly like a lab work. It does not pay well at all. I've spoken to other marine biologists with just a bachelor's degree, and they're making, let's say, for example, in Florida, they're making about $22 an hour in Florida, and they have a bachelor's degree. All right. So let me ask you this. Then let's add the master's or the PhD.

What's the range of income once you've reached that level in marine biology? Does it go up immensely? It could range somewhere on the 70 figure. It depends on which degree we're talking about. 70 what? $70 an hour? Or 70K?? $70K. So let's call it $70K and is that the

low, medium or high? That would be more of the low range starting off about that range. And then what could you get to? I've seen it as over $100,000 but that's a very low percentage but there are biologists out there that make a hundred and more. All right you're helping me you're helping me form an opinion here. How much is it going to cost you to get the master's and then how much would it cost to get the PhD? Give me the two different numbers. Well that I have not looked into into in depth with at the moment.

Got to go. You got to find that out. Because I can't give you a really informed opinion here, but I can give you a theory, okay? So to me, it's not, to me, based on your needs and what you're presenting today, it doesn't make a lot of sense to just get the bachelor's in marine biology and make 22 an hour. This doesn't make a lot of sense to me. And I also don't think it allows you to reach the level that you want to reach. I think that was obvious.

Is that correct? Correct. All right. So now you don't know what it's going to cost for a master's and a PhD, but you don't have that money right now. You don't have that saved up either, do you? No. And you're already going, I need money. All right. So I just don't know if the marine biology situation for you is realistic

in the next three, four years. It may be a seven to 10 year play. Now I'm the first person to tell you, and Rachel knows this, I started into broadcasting at 31, 32. It took me nine years to land the gig, the dream gig. I'm willing to wait that long. Most people are not, to be frank. And so if you're willing to wait seven to ten years, meaning you're busting it, you're hustling, you're living on way less than you make, you get rid of any debt you have now, and start saving you're doing multiple jobs do I think you could get there yes I do but I also don't know how much it's going to cost and you don't either so we got to go get an answer on what's a and by the way what's the lowest barrier degree and then master's program not the fancy big name because

the fish don't care and neither do anybody else how fancy the degree is. Now let me flip it Rachel. I'm sorry I'm talking so much but I'm trying to walk I want to walk through this logically. Getting a nursing degree is also expensive and you're probably going to start out somewhere between 60 to 80 in nursing as well. Am I right, roughly? Correct. Currently with my jobs right now, I only make $40,000 with working that many hours. I agree, but I would rather guide you, and I'm going to guide you to making more money that doesn't require a degree. Because going to school and spending money you do not have, it's not an option right now. You don't have the money,

and we're never going to tell you to go get a loan to then make $20,000 more than you're making right now. I'm convinced that I can help you make $20,000 more than you're making right now without getting a cent borrowed. And so you're working too many jobs right now. So what we've got to do is start looking at the trades. We've got to start looking at maybe some technology jobs that you could learn. You could take a boot, you could take, you go to Bethel Tech. Bethel Tech, I endorse Bethel Tech. You ready for this? We hire people at Ramsey Sluice for Bethel Tech who've never been in tech before in their life. And it's a nine-month program, and it's less than 15 grand. You could scrape up 15 grand together a lot faster. That's one option is tech. And you could start making 75,

80 in tech with a path to six figures quickly. That's just one option. The trades, if you're handy at all, you can go into electrician, plumbing, carpentry, and be making 40, 50, 60 bucks an hour, somewhere in that range. And I may be a little bit low on that. I'm just kind of speaking in general across the country. So so John you've got to increase your income to stabilize yourself and be able to find a path forward on the marine biology yeah it's not nursing school and I wonder John too if there's a way to take your passion and what you love about marine biology and is there a way to do that that's going to probably look different it won't be maybe as formal as a role as a marine biologist but are there sectors of you know different you know jobs in florida that you're like oh my gosh

you know i could go and assist i don't know a famous photographer and get the scuba, you know what I mean? And you're down, like you're able to do what you want to do to a degree without having to have the formal title and working for the formal marine biologist. Does that make sense? Like, is there, is there something that you could do that is like it, that you still would enjoy and love, but it doesn't cost you to have to go and get a PhD in marine biology. Yes, and there's other disciplines, of course, with marine biology in itself. But that's the question I've been, the answers I've been yearning for to get is that I was thinking, well, why don't you get into nursing? Because I'm looking at a seven, possibly a 10-year journey here for marine biology. With nursing, two years, I could be earning some decent money.

Yeah, but you can't afford nursing school right now, so you're going to have to wait maybe a year or two to be able to pay for nursing school, is what I'm saying. I'm fine with you going the nursing route. I just don't think it's worth the effort that you're going to have to put into it. I'm saying. I'm fine with you going the nursing route. I just don't think it's worth the effort that you're going to have to put into it. I'm with Rachel. Go start working in that field. Maybe you can get a job, make it 35, 40 bucks an hour or whatever. You've got to increase your income, remove any debt at all in your life so that you can stack cash to pursue the marine

biology. I'm not trying to talk you out of it. I'm just saying you're not there yet. It's going to take some time. Appreciate the call. You've got some tough decisions to make, but I know you'll do the right thing. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, this is The Ramsey Show. It's where we help you win in your life, winning your money, winning your work,

and winning your relationships. The phone number to jump in because we want to help you. We want to talk with you. Coach up today is 888-825-5225. That's 888-825-5225. I'm Ken Coleman and Rachel Cruz, my good friend, is with me. She's a Ramsey Personality multi-best-selling author. Number one's here, number one's there. She's got a new book out in her children's series called I'm Glad for Where I Am. And all of that is cool, but what's really awesome is today is Rachel's birthday. So if you've been watching, hey, it's a new hour, new people. That's true.

Would you just let me celebrate you, please? Thank you, Ken. Thank you. If you know Rachel, you'll love her. And if you follow her, reach out to her on the gram and say happy birthday to her. And it's a special day for her. She's 36. She gave me permission to tell you that.

So there it is. Thanks, Ken. What are we going to do for 40? We got four years to plan let's talk about it a big 40th yeah i didn't bring cake folks i've already apologized to her i'm a terrible co-host and friend um i didn't bring any cake is abound don't worry yeah that's all right well let's go shall we go across the pond because the screen says that alex is on the line and i'm going to try to say this right because i care

husband trying to do a british accent and it's gonna and it's and it's gonna irritate rachel that i care enough to try but i think it's birmingham let's see how you're supposed to say it now people in alabama would say birmingham but alex says it a little different let's see if this is true alex you're on the The Ramsey Show. How can we help? Hello. Thank you very much for having me on the show. It's a privilege to be talking to you guys. Will you say where you're from?

Yes, it's Birmingham. Birmingham. I said it pretty close. You're so British, Ken. What do you think, Alex? Did I do well for a Southerner? Yeah, spot on. Yeah, it was bang on.

Yeah, brilliant. Fantastic. Brilliant. I love it. Well, I'm excited to hear you talk i really am so tell us why you called yes so i was hoping um you guys could help me out my father and i have been having a discussion about credit cards um we agree on the first part of the discussion however on the second part we disagree um when we're comparing a credit card versus a debit card we both agree that if there was an unauthorized withdrawal from the account you would be covered under the zero liability policy on mastercard and visa however my dad thinks that with an unauthorized transaction a credit card would be better protected than a debit card for example if i bought a suit and then the

tailor went out of business, my dad thinks that a debit card wouldn't be protected the same as a credit card. Yeah, so that's my question. I don't know if you guys can help. Yeah, I don't know in that specific scenario, to be honest with you, Alex. But yeah, I mean, obviously, if there's any level of fraud or anything, yeah, you're under the same protection. I mean, when you have a MasterCard or a Visa logo on your card, you have the same protection, whether it's a debit or a credit. Now, I will say to everyone that's listening, you know, if it is a credit card and there's fraud that happens, none of your money's been touched, right? It's the bank's money because you're borrowing that money.

So when it is a debit card, it will take time to get that money back. But legally, you will get that money back under Visa or MasterCard protection. So no, I would agree, I guess, with you, Alex, on that. We're on Team Alex today. Yeah. Yeah. But what about if it was an authorized transaction? So if I authorized the transaction, but then it went wrong? And then it went wrong, that they charged you wrong? Or what do you mean? So let's say I bought something and it wasn't what I expected. My dad seems to think that a credit card would be better protected than a debit card if it

wasn't what I expected. So I authorized the transaction. There was no fraud. There was nothing like that. It's just a crappy product and you don't like it yeah no i think that would be within the return yeah element because when you use the card at a merchant uh you know you have the option to run it as a credit which is what i suggest people do because then you do have it's an easier uh you know way of protection versus going through the

pin route of a debit card traditionally um so from the merchant's perspective, to a degree, I mean, it's run just like a credit card. Okay. Yeah. Okay. So no, I mean, I think you'd have the same exact protection. Yeah. It's just all a myth, and it's out there from the credit card companies. It's become a part of the cultural conversation, and it's global.

And so this is not a new question for us. Because you're either disputing, hey, I need my money back, or you're disputing take this charge off the credit card. Either way, you'd have to dispute it if you authorized it. That's right. But in the same way, the merchant would have to, I think, extend the same amount of policy, whether it's a credit or a debit. Well, that's between you and the merchant because you're saying, I don't want this.

I want to return it. And every merchant has their own return policy. But again, it just feels like dad's trying to talk you into a credit card because he just thinks it's safer for you. And it just doesn't provide any more safety. And our position at Ramsey Solution is that it creates a lot of traps for you and it could cause a lot of harm in giving you a very easy, effortless way to incur debt, to pay for something that you don't have the money for. And so we just think it's a trap. And so don't get caught up in the whole, it's safety. That could be scary. There you go. Good stuff. All right. David is up next in Minneapolis, Minnesota. David, how can we help? Yeah, I'll just go and see if prenups are a good

idea. Oh, I say no. Good question. And what kind of, I the only scenario david off the top of my head that i would say this is maybe something to look at is if there was a tremendous amount of wealth on one side versus the other and even in that you know i we've heard situations of family businesses with voting stock and different things that you want to protect certain, you know, aspects of your wealth because it, because it is entangled in other things than just the person you're marrying. So in a degree like that, I can see it as an option, but I would say for 99% of people out there,

no, I, I don't think a prenup is a great idea. Why are you asking? I was just asking cause I've been dating somebody for about a year, and it's probably the closest person I've thought that I could marry, but she's 10 years younger than I am. She's only 24.

I'm 34. She's responsible. How much money do you have? She's not. If I liquidate everything in my house probably 400 000 no i would not get a prenup that's ridiculous if you can't trust her with that you don't need to marry her yeah and if you're worried about a 24 year old why are you dating a 24 year old because i've got i've dated a lot of people i know why you're dating a 24 year old

it was a rhetorical question all right right? I'm just keeping it real. Hey, no, David appreciates that. This is dude to dude. You just sit over there and let the dude handle this one, all right? Oh, my gosh. No, David, don't get a prenup. Yeah, and if you're worried about marrying a 24-year-old, don't date a 24-year-old because it doesn't make any sense.

Now, there are people with large age gaps that have very happy marriages. And I'm not talking about that. I'm talking about David, who's so worried about the potential marriage to a 24-year-old. He's got the problem, not me. Yeah, David, no. No prenup in that situation. Yeah. And I honestly, rule of thumb, it's the rare 34-24 combo that works. Ten years is a lot at that age. Yeah, but I, yeah. Didn't say it couldn't work. I'm saying it's a lot to overcome.

I agree, I agree. Hello. It's a whole decade. You got a Gen Z and a millennial. That's all I'm saying. You said it well. We're going to debate it during the break. This is The Ramsey Show.

Welcome back to The Ramsey Show. I'm Ken Coleman. Rachel Cruz is with me. The phone number to jump in is 888-825-5225. Hey, if you haven't heard, we've got an awesome budgeting app. We think it's the best out there. It's called EveryDollar, and this helps people manage money the Ramsey way, the way we talk about it on the show here.

It works with iOS, Android, or online. And you can start EveryDollar, kind of kick the tires, if you will, for free and immediately just to kind of get an idea, hey, how does this thing work? And where am I with my money? Do I know what I have and what I don't have? And if you're new to EveryDollar, we'll show you a long-term financial roadmap, track your net worth, debt-free date, retirement date, baby step progress, and so much more. It really works with you, walks with you in your financial daily path. You can download the free app for iOS and Android or go to everydollar.com to get started. That's everydollar.com where you can just search EveryDollar in your app store. All right,

East Brunswick, New Jersey is where Cole awaits. Cole, how can we help? Hi, Ken. Hi, Rachel. Hi, how are you? First of all, happy birthday, Rachel. There we go. Thanks, Cole. Happy birthday to you. I appreciate it. Thank you. My question is in regards to pension and annuity, basically saving for retirement. I'm currently saving for a house. I'm part of a union that puts away money separate from my hourly rate towards pension and annuity. My total loaded rate, it would be about 27%, my pension and annuity. I'm wondering if I should be considering that when it comes to how much I'm putting away for retirement. Should there be extra on top of that out of my hourly rate?

And also you guys say to budget your mortgage and expenses, like monthly expenses to be 25 of your income should that technically be 25 or should that be part of my total income because i am saving for retirement yes yeah yeah so it would be um or yeah i'd be well it's yeah 25 of your take-home pay so the so the amount of money that you bring home, which would not include insurance or retirement. Yeah, and 25% is just really the mortgage or the rent and some insurances and HOA fees and all of that.

But your other bills associated with the house would not be in that 25%. So the 25% really is just that guideline for the amount of mortgage or rent that you're paying with some insurance. The mortgage itself, no regards to taxes or home loans or anything? No, so sorry. Insurance and taxes and HOA. Yep. All of that together would be part of that 25%, correct? But any other bills, like I didn't know if you meant like electricity and all of that, like all of that's separate. That's not in the 25%. So with your pension and the annuity, is it a variable annuity?

So yes, it is a variable annuity. And do you have, is that required? Are they making you do that? Yes. They do that completely separate. It has nothing to do with what I get paid, really. You don't even really see it too often. You can check on your statements and whatnot, but I kind of disregard it. So how much percentage is the pension that's going in? So the pension is $8.50 an hour and the annuity is $10. Okay. Do you know what? And the annuity gets overtime, but the pension does not. Yes. Do you know what percentage of the annuity? I'm trying to get to

that 15% because I, well, for the annuity, I probably would not count. I wouldn't count it in the 15%, but your pension, I would say take half of it. So how, what percentage of the pension is your income right now? So the only thing, the only calculation I did was I took the pension annuity and hourly rate, added them together, and then got what percentage the pension and annuity was, and it was 27%. Okay. So, yeah, I would break it out even more, Cole, and see specifically what percentage is the pension,

what percentage is the annuity, and then whatever that comes out to be, let's just say, because the pension will be less than the annuity according to the dollar amounts that you just gave me. So let's say the pension ended up being 10% of the 27 or something. I would take 10% of it, divide it in half. So that's 5%. So I would say you have 10% of your income that you still need to invest in retirement because the things with pensions and annuities, how it's set up for you is that you don't have a say really in what they're investing in. And so giving yourself way more transparency and ability and options is really key for retirement. So you may have to add another 8% to 10% and maybe opening up a Roth IRA is a great option.

And you can start there. There's a contribution limit. I think it's $7,000 this year, but that would be my next step for you, Cole, is to put some money into a Roth IRA because you'll be able to control what it's invested in with all these other options. They're going to be great for you. When it comes to retirement, it's nice to have a pension, but you don't have control over what they're investing in. So, yeah, I would do all of that and then be saving for a down payment. You have a lot going on. Are you debt-free?

I am. Awesome. I mean, I have maybe – I do use a credit card. I have like $200 on it, and I just – I use it for gas to get to work, and then I pay it off. Okay. That's pretty much it. Okay.

Cut it out. You can use a debit card. But what are you making a year? So I recently got promoted about a year ago. Since then, I made, with overtime, $170,000. And without overtime, my base is about $100,000. Good for you. Good for you, Cole.

How old are you? I'm 27. Nice. Awesome. So great. Yeah, so I think that would be my next step is I would put a little bit more into retirement on something that you can control. Like a good Roth IRA is, I think, a great option.

Before or after the full saving for the house? Like once I'm in the house, do that or pre-plan that now while saving yes so we call saving for a down payment on a home baby step 3b so do you have an emergency fund already saved yeah i have my three to i have about four months expenses oh good for my current expenses and then i have about a hundred thousand towards a down payment. Good night, Cole. Good for you.

So yeah, I would probably, then I would pause on the Roth, save up a good down payment. I mean, if you can put 20% down, you can avoid PMI and that would be fantastic. I currently am at 20% for what I'm looking for.

I was trying to go a little higher because I was expecting um it had to be 25 percent of like oh yeah so you may have to put more of it yeah that's right depending on what type of house and expensive where i'm at yeah i'm looking at like 2800 okay 2800 a month right now if i put 20 down so it's still kind of high okay good for you i'm so proud of like your your diligence in all of this so yeah if you need to take another year or two and continue to put money away for a good down payment you can do that there's really no rush in this but I do want you to start investing pretty immediately after you get the house but the house is the next big step for you so that's where I would focus a lot of my cash flow so uh well done Cole and let me just

tell you, and some encouragement for people watching or listening, you know, the baby steps that we talk about, some people kind of do them out of order, Ken. They kind of do it at their own, what they think. And I'm going to kind of this, this, this. And we tell people all the time, if you just do the plan, just do the steps in order.

They work. They've worked for millions of people. Just do it. And so Cole is such a testament to that. I mean, he's really doing it. I'm like, he's literally by the T. And what's crazy is he is going to pay off his house sooner than he realizes. He's going to be investing.

He's going to have this annuity and pension and a Roth. And, you know, he's going to be doing so great in his, I mean, just in a few years. You think about his early 30s and he's going to be killing it. Everyday millionaire. I mean, he's only 27. And so he's such a head start on most 27-year-olds. I wish I knew the data on that mid-20 about how much the average 20-something is carrying in debt at that point in their life. No savings. And yes. So really good stuff, Cole. Thanks. It's very inspiring. It is possible. And I think you're

absolutely right. It is the discipline to kind of withhold early on in life and then not have to worry about withholding much at all later on in life. And I wish that message was more clear. The current message on social media that we're seeing from young people is they feel like they're just working for nothing. They're working just to barely make rent as opposed to Cole, who's right in that demographic, and he's working to win big time financially, and he's doing it. So again, Cole, thanks for the call and for the question, sharing your story with us. The best is yet to be for you, sir. Really good stuff. All right, she's Rachel Cruz. I'm Ken Coleman. We got to do a quick break, but we'll be right back with more of your questions. This is The Ramsey Show. Welcome back to The Ramsey Show.

Welcome back to The Ramsey Show. Rachel Cruz joins me. I'm Ken Coleman, and you are listening and watching The Ramsey Show. So excited that you are with us. 888-825-5225 is the number. Stephanie is joining us now in Los Angeles. Stephanie, how can we help? Hi.

Happy birthday, Rachel. Yay. Oh, thanks, Stephanie. I appreciate that. You're welcome. Okay, so I am a single mother of two girls. I've been a single mom for a long time now. And I own a business. I'm a professional organizer.

And I actually, like, um, families on how to like keep their lives together. Well, I just am really struggling financially. Um, I ended up having to get a full-time job. I, long story short, my savings just got drained when I put employees on payroll out here in California, it's super expensive. And anyway, so I just, I don't know the first thing about like good budgeting. I did not grow up. My parents like saw bankruptcy three times and I'm just trying to set up a future for my children and I just want to get out of debt. So I need some advice and I want to sell my car and yeah. Okay. I got a quick question for Rachel Diveson because she can walk you through this, but I'm just curious, how does a person who is really good at teaching other people to be organized,

not figure out how to do a budget? I'm not saying that in a judgmental way. I'm just curious, where do you think the disconnect is there? No. So I know how to stick with a budget. What happened was I was going, uh, a custody battle came up in the middle of everything. And, um, then my dad got early on to Alzheimer's. This was all like, um, in a short period of time and it just threw me for a loop. And, um, a lot of my money went into custody. And, um, then I ended up taking out an EIDL loan, which I've never been like a credit card person, a loan person. I actually kind of got talked into getting a business credit card for my business. And then because I was paying everything cash before that. And the custody battle happened. I put the whole custody

battle on my business credit card cause I was like desperate. And, um, so yeah, this is where I'm at. And I never coached anyone on finances. I coached neurodivergent families, how to like set up systems in their homes, homes like functional and how to like live purposely in their home. And yeah, so, but right now I just, I'm just in over my head as far as what to do. My economy is not that great right now. What are you making in your day job? So my full-time job, I make 19.08 an hour. There is, it's a sales job. I do like interior design. And so we do get

commission on designs, but I've yet to reach that commission because their whole bonus structure is just, it doesn't make any sense. You have to sell at least $80,000 between installs or whatever. I don't know. So I've never reached that. And then my organizing job, I have three contractors. So I bring in right now, it's not really good. I bring in about maybe 2000 a month with that. So it's, but it's just so slow right now. And I just, I was making pretty good money. And now over the last couple of years, it's just so slow right now. And I just, I was making pretty good money. And now over the last couple of years, it just hasn't been that great. Yeah. And then you throw in things like a custody battle in the midst of it.

Oh, yeah. Yeah. Oh, yeah. I pay for everything for my kids. Like, I don't get any help. I pay for the cars, insurance, everything. Wow. Yeah. Well, let me just say, you know, when it comes to your kids,

when it comes to your health, like we are all about fighting the fight, right? I'm like, it is, you want to, you want to do it, you know, because those are the important things in life. So that's, I want to free you and, you know, not pile on any level of shame, give yourself a lot of grace. So, okay. So how much debt, Stephanie, do you have? Do you know? Yes. So I have my $20,000 EIDL loan that start payments will start coming out in October. Um, I owe, um, almost 9,000 on a credit card. Okay. And then my, my car is, um, I owe about 13,500 on that. And then here's like the really hard part for me. Um, I got behind on taxes. I just got paralyzed with fear by the way, but I

just, I got behind on taxes three years. Those are just, um, finishing up being filed. So I don't know what I owe on that yet. Okay. So I'm waiting on that. So those are my, those are my debts. And you're making 2000 for your organization business. I know you're making 19 an hour for what you're doing, but do you,

how much, how much will you bring home a month with that full-time job? So each check is about 1200 and some change after insurance and all of that. And you get two checks a month? Every two weeks, correct, yeah. Okay, okay. So it's a little less than five grand. And have you been able to map out, are you able to pay your bills, Stephanie, meaning your mortgage, food, lights?

I don't even have a mortgage. So my rent, I'm actually in a great situation as far as that goes. I live in a two-bedroom apartment. It's $1,200. I've refused to move because I'm so nervous. I wanted to get my finances in order first. So $1,200 for rent. And then $404 for my car payment.

And then, of course, utilities and all that stuff. How much is your car worth? Do you know? I'm not exactly sure. I did look on what other people are selling my type of car for, and I saw anywhere from $15 to $19. Okay. So here's what I would suggest I feel like

For you Stephanie a good Good win would be just A quick win to feel some level of traction Because you're going to start to make Some changes right when it comes to your money And those changes are going to be uncomfortable because you've never done this before But the fact that You're not underwater on your car

I mean man if you could get If you could get I mean if you could get 19 you could get yeah i mean if you could get 19 000 or something for it and go get a crappy six thousand dollar car that takes thirteen thousand dollars of debt that's gone just gone yeah um and then and then looking at yeah your credit card attacking that next um and then the the loan after that, the $20,000 loan. Now, when your taxes come back, Stephanie, if you can't pay them by the tax deadline, go get a personal loan from the bank. I would rather you have a personal loan than owing the IRS. Okay. So that will be a step. And what you're going to do

is pay off the smallest debt to the largest debt. And again, the car, car i think would give you some traction do you have any savings uh no my putting employees on payroll just drained my savings i had about okay so you have nothing okay so you may want to relook to um i wish we had more time with you i would relook maybe the structure of your company i just i don't i don't know if it's for sure like it may be a thing it may be a thing step Stephanie, that you just say, yeah, that you that you close it down for now. I mean, like, is there something you know, is there a way to just take that burden off? You're just carrying a lot. And I'm just trying to relieve some margin for you. So I do not have any employees on payroll anymore.

It's all contractor jobs. I just yeah, I just contract, but to be honest, I am thinking about just going back to, because it is stressful, like owning a business. I've had it since 2016. It's really, it's a great business. We were like all around California as far as like our, um, uh, reputation and stuff, but I just am so stressed about it. So I am thinking about stepping back and just working full time and maybe taking on jobs by myself for like extra income.

But as far as selling my car, that was actually the reason why I called you. I wanted to see if you thought that that was- It's a great idea. I probably would, honestly. I mean, that would be such a relief not to have that car payment every month. Yeah. What is the payment? What's the car? 404. 404. I mean, listen, Stephanie, how much would you love a $400 raise per month? I would love to just like take that 400 and put it into like the rest of my debt. That's right.

If you stay on the line, Kelly and Austin are going to pick up. We want to give you Financial Peace University. It's our nine-lesson course, Stephanie, and Every Dollar Premium. It's our budgeting app. And then also, I'll have them connect you with a financial coach in your area because I know as a single mom, you're juggling a lot. And I think sitting down with someone who has the heart of a teacher who can walk through really specific numbers and scenarios, and it may only just take one session, but it's better than a seven minute chat that we were able to have here on the show.

But we want to connect you with some of that stuff, Stephanie, because you're on the right track. You're like right there and you got to just start making those steps and you're going to feel a lot of traction. So we're excited for you. We're going to take care of you. Thank you for calling. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm Ken Coleman. Rachel Cruz is with me in studio this hour, 888-825-5225. 888-825-5225 is the number to jump in. Our scripture today comes from Titus 2, verses 7 through 8.

And everything set them an example by doing what is good in your teaching. Show integrity, seriousness, and soundness of speech that cannot be condemned, so that those who oppose you may be ashamed because they have nothing bad to say about us. And our quote of the day from Les Paul. Don't say you can't until you prove you can't all right how about that there you go there it is there you go Thomas is joining us in Asheville North Carolina Thomas how can we help all right thank you guys so much for taking my call sure what's up um so um my father father has planned a vacation for this summer for the whole family.

I'm married. We have two children. My brother's married. He has three children. He gave us a little bit of heads up on it, basically just asking when the kids would be going back to school. And then he planned this trip for the end of summer um we're right in the middle of baby step two should be debt free by looks like november um he's paid for the location and like lodging and everything um but my main concern is um i work like 70 75 hours a week and um i don't have any pay i don't have any paid time off so my my main concern is is missing that income um while we're on this trip um so i was kind of hoping to get you guys advice on that so before dad comes to you

with this vacation idea what was the plan what were you and your wife thinking about summer no vacation yeah i mean we've been we've been busting it just trying to get everything paid idea. What was the plan? What were you and your wife thinking about summer? No vacation? Yeah, I mean, we've been busting it just trying to get everything paid off. It's gazelle intense. Yeah. So I'm going to oversimplify it because I think this is the key issue. You weren't going to go on a vacation. And we agree with that. You guys are going hard. Man, you're working 70, 75 hours a week. That's impressive. And you weren't planning to anyway. Now Dad's asking you to do it. Wait, that's what I, not to jump in.

Did he ask or did he tell you guys? Well. Did he say, well, that's an interesting part of it. It was a little bit of both. You know, like my brother has children. Our children have never met their cousins. He's kind of really loving the whole grandpa role and kind of wants everybody to get together. They're getting a little up there in age,

so he kind of looked at it as an opportunity to get the whole family together one last time and have all the grandkids in one place because my brother lives 1,000 miles away from where I live. I would – so I think – well, I'll tell you what. I'll ask one other question, and I want Rachel to see what she says here. Is he paying for everything or just the lodging, meaning you guys would have to pay for the travel to get there plus meals? Food, he's handling food and lodging because I'll be doing most of the cooking.

That's kind of how it's always worked out is he buys the food and I prepare it. But we, I mean, we'll basically just be responsible for gas to and from. So it's not so much the expense of the trip, but the missed income. That's right. How many days will you guys be gone? Six or seven, depending on when we travel back. All right. The only other question I have is, you – man, you're already working 70 to 75 hours. I want you to have a vacation. Yeah, but they weren't planning on it anyway. I know.

So this is not so much like an opinion. It's advice. And I think I would do what you believe is right to do, and I think I know the answer to that. I don't think you want to go, Thomas, right? I don't think you believe is right to do and I think I know the answer to that I don't think you want to go Thomas I don't think you do either I I really do um I really want my kids to meet their cousins and I really want you know my parents the opportunity to have all their grandkids in one place because they're you know both two five six and seven and they've never all been in one place at the same time but um but i mean i'm just i'm concerned about but what a week of it hold on i'm gonna be devil's advocate hold on

be devil's african i want him to finish that sentence okay go go thomas sorry cut you off we've been working really hard and i'm just kind of, I guess, very apprehensive about what that month's budget will look like with, you know, several hundred dollars missing from it. And I don't want that to take away from what the experience is supposed to be if I'm there, you know, worried about that. So have you added up how much money you will lose out on being there? Probably about $1,100 or so, and that's not counting the gas to and from. Sure, sure. And how much debt do you guys have left?

We've got about $13,000 left. Okay. What would it do to your budget would it stress you out without the 1100 would that make it super tight um not particularly we still have to factor in like um we haven't you know the kids back to school stuff is going to be that month and the month prior to that yeah in august so yeah i of just... I mean, can I say this? I know. Okay, Thomas, you got to do what you got to do.

Here's my devil's advocate response. What would you do? To be with... And again, this is if you want to, Thomas. If you feel guilted, if there's some weird emotional thing, if Dr. John Deloney was in here and is asking you, like, psychology questions of family stuff, right? Like, if it was just a healthy situation, I think giving up $1,100 to be with family for one week,

because it doesn't happen. It's not like this is a yearly tradition would be worth it for a family situation like that. And everything is paid for. Now they're making you pay for everything. That's one thing you can't afford to go. Everything is paid for. Not they're making you pay for everything. That's one thing. You can't afford to go. Everything is paid for. And maybe you go half the time. Maybe you and your wife say, hey, we're going to go for four days. And there's something about living life still. And this isn't taking you guys deeper into debt. It may slow it down for three weeks, the debt snowball.

I agree. But there's something about the situation feels the situation just feels so unique that it's not going to happen and for eleven hundred dollars a pardon would say oh my gosh like go be with your family i agree with that if that's what's going on and if that's what thomas wants to do i don't't know if Thomas wants to do it. Let's ask him. Thomas? We definitely want to. No, forget the want to. No, here's what I'm asking. You're working 70 to 75 hours a week.

Is that to pay off the debt faster or is that to make ends meet? And the $1,100 is going to make things super tight. And it makes me feel like that's the case when you're talking about school supplies and $1,100. No, $1,100. No, hold on. Let's let him answer. Well, no, I mean, if I was working 40 hours a week, all our basic, our budget could sustain on that. It's just the gazelle intensity. Because we're putting about anywhere from an extra probably $1,500 or so per month on the debt.

So back to Rachel's point. It's a month behind. $1,100, not making that is not going to make life tight. It's just going to slow the snowball down. That's right. Yeah. Then I agree with Rachel now that I have the facts. Wow.

You didn't let me. I was trying to get the facts from Thomas. I threw the life raft and Kinson. Sure, Rachel. No, I actually agree. I just needed to get to that point, though. I couldn't tell emotionally if he was, what's the 1100 doing in this case? I think because the kids have never seen each other before, dad and mom are getting older,

all the things you already said very well. Thomas, I'm okay with that. And honestly, Thomas, take four days of a paid for vacation as a gift of a little bit of rest too, right? I mean, y'all have been working like crazy, which is amazing. It's exactly- Yeah, I'm so proud of you. But this is a unique thing and I- I agree with you. I would say go. You've only got one shot around this globe and I would do the family vacation. Knowing that the $1,100, you're not going to have that,

the subtraction of that, it's not going to have that. The subtraction of that is not going to make things tight to where you can enjoy the vacation. And I also want to point out, Thomas, I would like to vacation with you because I'm all for buying the food and you cooking it for me. I would like to point that out, Rachel. This guy's great to vacation with. It sounds great. Hey, Thomas is coming. Great. Let's go get the brisket. You know, thomas here you go uh how do you feel now you feel like this is the right move you're gonna do it you got to talk to the wife what's the story yeah i'm gonna talk to her about it i think it's there's a mentality shift that needs to take place because i've been we've been doing this since august yeah i think it's a memory and i don't

want you to and i don't want you to lose momentum either. So just see this as like a quick pause, a breather, paid for a vacation, and then you're back at it. But I think the scope of family and cousins and all of that, there's something really special there that I would hate for you guys to miss out on because you wanted to pay off debt one month later. That's right. And I'd make the old man cook one meal for him. Yeah. Maybe go half the time. All right. Good hour, Rachel Cruz. Thank you, James Childs and our team. Thank you, America. This is The Ramsey Show. Hey guys, I'm Rachel.

And I'm George. And you've probably heard our voices before on The Ramsey Show. And do we have a surprise for you. Yep, we have our surprise for you? Yep. We have our very own show, Smart Money Happy Hour, where we talk about pop culture, current events, and of course, money. George, it's a great show. And what else do we talk about?

So much, Rachel. Not enough. And yet too much. We talk about guilt tipping because tipping is out of control and I won't stand for it anymore, which is why I'm sitting. I'm glad you're taking such a stand. And we also talk about something else I'm passionate about, Disney adults.

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

It's pretty fun. We keep you relevant is what I'm trying to say. We help you out. So pull up a chair to the happy hour you wish your friends were having. We promise you won't regret it. And if you don't have friends, we'll be your friends. We will. We're great friends. So make sure to check it out on Apple, Spotify, YouTube or the Ramsey Network app.