The Ramsey Show - Wisdom With Money Means Moving Slowly

Starting point is 00:00:02 Brought to you by the Every Dollar app. Start budgeting for free today. Normal is broken, common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studio, this is The Ramsey Show. I'm Dave Ramsey, Ken Coleman, number one bestselling author, host of front row seat, a big hit on the Ramsey Networks. He is Ramsey personality that is my co-host today.

Starting point is 00:00:34 The phone numbers, triple 8-255. 225. Sarah is in Atlanta. Hi, Sarah. How are you? I'm good. How are you? Better than I deserve.

Starting point is 00:00:44 What's up? I'm doing good. So my question is that, so I am in a relationship. We are not married, but we do just call each other's partners. We're both unhappy. I've voiced it. He's voiced it. And it's mainly due to our communication style and our lack and our differences.

Starting point is 00:01:04 Like, for me, I'm more of a person. and like I love a clean house. I love to be supported by like access service and going out together. He's more of a homebody and he's really affectionate. But I didn't grow up to be like an affectionate person. And when we do talk about issues, it does become escalated very quickly, such as if we're not seeing out of the eye, he's quick to yell and point fingers. And I'm also just withdraw. Like I'll go to a different room where I say, just talk to me later when you're calm.

Starting point is 00:01:35 So I just want to know, like, how can we better communicate without, or how do I handle him or handle situations when he's yelling at me and how to do better with that so you can see my perspective and see it more like a team issue instead of like he's against me or I am against him. How long have you all been dating? So we've been together for five years and we have a child together. Has the relationship been the way you just described to us the entire time? Oh, no, it was way worse in the beginning. So he would... Well, at least we're trending up. I didn't expect that answer.

Starting point is 00:02:18 What do you think has caused it to get better? What caused it to get better is maybe I'm one of those people like I learned to protect myself like my emotional state. So sometimes I just withdraw and I think of something else. because in the beginning he was very verbally abusive towards me like he'll yell at me he'll curse me out like for hours on end like for three hours or four hours even when I was pregnant um we had um arguments for that long and to the point of there they would just escalate where he's like in my face shouting and stuff and um is that still happening oh no it's not

Starting point is 00:02:55 happening anymore like we talked um i talked about it he was like asking me like why am i less possession and so on. I'm like, well, I can't be affectionate to someone who's like in trying to purposely intimidate me. And he has said before that he does purposely try to make me cry because he says sometimes he feels like I don't have emotion. No, I hear you. Let me ask another question. Is it getting better, not because he all of a sudden got control of his anger, but because you've just detached so much and you've coward or you have, I'm going to use the word detach, for lack of a better word, to where he's no longer irritated. So, you're almost a shell of yourself.

Starting point is 00:03:31 Is that why it's better? I feel like it's better. I feel like it's a little bit of both. I feel like me detaching and taking my emotions away from the situation has made me handle the situations better, such as telling him, like, I'm not going to talk to him when he's yelling at me or just walking away. That has worked out for me because he seems like he finally got the message. The bottom line is you all suck at interpersonal relationships.

Starting point is 00:03:58 Yeah. Both of you. Okay. Mm-hmm. And you, because you won't set a boundary, you should never let anyone treat you the way you've been treated under any circumstances, period. And so if you were my daughter, I would have removed you from that house and left him in duct tape. Oh. You ain't yelling at my kid.

Starting point is 00:04:21 This is ridiculous. Okay? It's ridiculous. No one should be treated the way you've been treated. treated and you should never allow someone to treat you the way you've been treated. And so that should have stopped the very first time it happened not five years ago. So the only shot you guys have got, if you have one, is to sit down with a good coach, a good counselor. We're not that. I'm just an old guy that's been married 43 years and I don't yell at my wife, not if I want to

Starting point is 00:04:54 live. And so she's a hillbilly woman. Fryen Pan. throwing from East Tennessee is an Olympic event. So, you know, we don't, we don't do that stuff. So, you know, we get angry and we have arguments, but we don't treat each other that way. And so you guys need to sit down with a good marriage counselor, go see a good pastor in local church, and begin to get some guidance through. You've got in-depth relational training that you need to do. You've got some of the verbiage around it, so you've been reading or doing something. So, you know, you've picked up a few things along the way. But I don't think on a call, one phone call on a podcast that two old dudes can tell you how to fix all this.

Starting point is 00:05:42 Hey, whoa, easy. Easy with the old. I don't know that I'm going to accept that label. Compared to her. Fair. One final thing I would say in encouragement, very much because you're not married, I think I would throw a really strong ultimatum. The line is drawn in the sand today as soon as this call is over. And that's which word you're going to say to him, either you go and sit in therapy with me and we sit there until a professional says that we have the tools to actually be healthy, then I'm no longer going to be in a relationship with you.

Starting point is 00:06:15 That would be the one piece of advice. I would drop that today. Draw the line. It stops. And one way this goes forward, healing through therapy. That's it. That's it. Sit down with a good marriage counselor.

Starting point is 00:06:26 and a good pastor can recommend that or have it on staff. They can help you with this and get somebody in your life, kiddo, that can guide you to. Because neither one of you had people around you up to this point that would teach you that stuff because this is a really dysfunctional situation. It's not fair to either one of you. It's not fair to him to keep acting like that and think he can get away with it in society. And it's not fair to you, obviously, for all the reasons. So, and guys, you know, Sharon and I, after we've been married 10 years, we've been married 43.

Starting point is 00:06:59 We spent about three years in the marriage counselor's office. That was about three years after we went broke. When we went broke, we couldn't afford. Yeah. We just, instead, we're just angry all the time. But finally, we got a little bit of money and we're like, okay, we got to work on this. And the marriage counselor for me, I was telling Deloney this the other day. It was not, you know, people like, I don't want to, I don't need therapy.

Starting point is 00:07:20 I don't need counseling. Well, I didn't, really. what I needed was a tutor. What I needed was a relationship tutor. Someone to teach me how to talk to my wife, how to hear my wife, how to hear my own heart. You know, it's a relationship tutor. I like the tutor. You know what it also does?

Starting point is 00:07:39 It's a mirror. I was like I was going to school. Yeah. I felt like I was going to class. Yeah. That's what I was doing. And I did. I learned a lot during those three years.

Starting point is 00:07:49 Some of it I spout back at you people, but when you call in here. But we weren't starting from where you're starting, honey. Y'all got a lot of work to do. And if you do not do it, this is going to continue to deteriorate and it's not going to end well. So it doesn't get better unless it gets better. It's that simple. And getting it to where it's tolerable is not okay. That's not a way to live your life.

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Starting point is 00:10:23 Well, there's a lot of chaos and a lot of noise out there about the economy, about your money right now. And you can't win. You know, that, right? It's impossible. Well, we don't know that. You have more control than you think. This time, this time a year, it's time for you to take back your money. Starting at our free every dollar live stream that is tonight at 7 p.m. It's hosted by me and Jade, and we're going to give you the clarity you need to finally get ahead with money, and we're giving away $20,000 tonight, $10,000 GIFs, no purchase necessary. All you have to do is to enter, all you have to do to enter the giveaway is to sign up for the

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Starting point is 00:11:28 It's going to be a lot of fun. You guys, look forward to having you. All right, Hannah is with us in Tampa, Florida. Hi, Hannah, how are you? Hi, I'm good. Where are you? Better than I deserve. What's up?

Starting point is 00:11:40 So my husband and I, we're in our 30s. We have a 19-month-old and no debt. We take home about $68.50 per month. Our mortgage with taxes, insurance, with HOA, is about $2,800 right now because we have of an underpayment of taxes last year, and next year it'll hopefully be $2,400. So we're just wondering if we should sell our home and downgrade and rent an apartment instead or continue to be in our home. We don't only have much of an emergency savings, about $4,000,

Starting point is 00:12:15 and we want to work to eventually be a stay-at-home on at some point. Okay. Well, the deal is this, okay? You can survive your house payment being 40% of your take-home pay for a period of time. You just can't prosper. There's no room in your budget because your house poor. And so the answer is if you can't fix that in a reasonably close period of time, or if you do fix it and then you turn around and quit and it starts over again,

Starting point is 00:12:48 then that means we have a house that you can't afford if you stay home, right? Yeah. Mm-hmm. And if your husband never gets a raise and the taxes keep going up, or you never get a raise in the household income, let's say the payment goes up continually and your income doesn't. Well, obviously, that's not sustainable, right? Yeah. And so, but if you're in a situation, hey, my husband's finishing up an apprenticeship, he's going to be making double or whatever, you know, and it's five months from now or a year from now, yeah, you can hang on for a period of time. right? But as you have already discovered, that's why you're asking the question, there's no

Starting point is 00:13:29 wiggle room in your life, no margin to be able to win with. No, yeah, exactly. So are you going to be able to fix this in a reasonable period of time? No, he's still working on getting his bachelor's, which is going to probably take a couple more years, and the plan was for me to just continue working until hopefully he gets a higher paying position, and then I can quit my job. But it's going to always take a half. more years before he gets back. What does he do now? He works for a hospital just in like their billing department.

Starting point is 00:14:02 Making what? I think like $30 an hour. He makes about 30, I think 35 take home per month and I make about 31 take home. What would the bachelor's degree? What would it get him? What degree for what reason? Either accounting or finance to either go and be like an accountant somewhere or maybe a financial analyst. is what we're thinking of pursuing for him. Yeah. Could he, does he have margins where he could pick up some projects, some other clients doing bookkeeping, the very thing he wants to get a degree for,

Starting point is 00:14:37 but could do some, and I'm going to call it basic fundamental bookkeeping. Could he do that time-wise? I mean, with school, it would be really hard for him to have that. No, I'm going to say, all right, so what if we drop school, would he have time? Yeah, yeah. If he drops school, then he can learn to do that, and then he'd be able to have time for it, for sure. Here's the challenge. If I were sitting with you guys in your kitchen, I would be looking at alternate paths to do the kind of work he wants to do that don't require the bachelor's degree.

Starting point is 00:15:07 No, it might require it. But, you know, if it's the type of work and, you know, he can get some certifications, I would be looking at that. And I would be okay pausing school for a season. if he has to have the degree to do the accounting work he wants to do, then I get it. If he's going to get a master's and get a CPA, then he's obviously got a great group. He has to do it, yeah. But if you're not going to go that route, if you just want to learn accounting, yeah, that's way different. And so, but here's the thing.

Starting point is 00:15:38 You can't just wave a one and say, I get to do all of these things. Okay. Not make enough money and have too much house and quit my job. and wait on him to wander through this bachelor's for no apparent reason. Okay, we need to really get nailed down here exactly where we're going when we're getting there. And then that'll tell you, is this house a blocker? Or is it something we just need to hang on to for a minute and then it's going to be okay? Because if you told me he was getting ready to graduate and, you know, even in 24 months and his income was going to double,

Starting point is 00:16:11 he's going to be making 60,000, and, you know, your income is going to go up and you can figure out something you could do from home even with a baby. and so our income overall goes up substantially, then the house is going to be fine. But you may, you know, but you don't want to trade a house you can't afford for your desire to be at home with a kid, too. I'd rather you'd be in a cheap house and be home with a kid if that's your desire. And so you guys got to make these conscious decisions. But you really, the old thing, you can't have your cake and eat it too. You can't do both, okay. Casey's with us in Atlanta.

Starting point is 00:16:43 Hi, Casey. How are you? I'm doing well in yourself. Better than I deserve. of what's up? So I just received a job offer. Yay. Thank you.

Starting point is 00:16:54 I'd be switching from a work from home position that I currently have to a home health position where I drive around the metro area and provide services to patients in their home. I would be receiving a significant pay increase. Last year, I've ended the year for my full-time job with about $64,000. And my offer letter for my base pay for my new job would be about $100,000. $120,000. Wow. Wow, that is huge. Love it, Casey. Way to go. Thank you. Thank you. I guess the question lies. I drive a 2005 Toyota Corolla, had the same car since college. It has over 200,000 miles on it. And the question lies in, would you still recommend only $1,000 in emergency savings and then pouring my extra into my student loan debt? Because my major concern is that with this home health job, my car is my livelihood. If I'm not able to see patients, I'm not able to have money. And because I have an

Starting point is 00:17:52 older car, I just kind of am hesitant about not having a backup plan immediately or having, you know, or having to go into debt to get another car. Yeah, you're making, but you're making $10,000 a month. Fair. Okay. So if the car breaks, rent a car for a month, save up $5 grand and go buy a car. Okay. But the car isn't going to break. I hope you're right, Dave. It does sometimes, but if it does, I mean, if it's a $1,000 car, it's a throwaway car, right? We get another throwaway car and we do it again. And you upgrade to a $5,000 car, but you just put everything on hold, rent a car for a month, and then go, and rent the cheapest little thing you can rent for a month and then go do that. You're not married, right? You're single, the way you're using your

Starting point is 00:18:49 words, I think that. Yes, I'm dating, but I am not married. Okay, all right, because there's, so there's no backup plan. I mean, there's no other car in the driveway type thing. Okay. So that's what I was double checking. But yeah, that's what I would do. And here's the thing.

Starting point is 00:19:06 I'll be honest. I am stereotyping your car. Mm-hmm. If you told me it was a Dodge neon, I might change my answer. I was thinking the same thing, yeah. Your car is the ultimate cool hoopty. Yeah. These cars have so much life in them.

Starting point is 00:19:28 Yeah. You might get another $200,000 out of that stupid thing. I don't want you to. I want you to get a better car than that. But, you know, how much student loan debt have you got? $73,000. Oh, man. Yeah, you're going to be done with that in about 18 months and move it up in car.

Starting point is 00:19:43 I like it. Casey, congratulations. Well done. That's what I would do. You know, she's got to drive around Atlanta. I just want to point out having lived there for a car. 11 years, you know, if you go to hell and you live in the South, you have to go through Atlanta. Yeah. Yeah. It's just the worst driving around. So we'll pray for her. Absolutely.

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Starting point is 00:21:53 Thanks for taking my call. Sure. What's up? Well, first off, I should just say that I am signed up for the live stream tonight. Awesome. Thank you. I'm really looking forward to that. Thank you.

Starting point is 00:22:03 So I know you have a background in real estate and you've run your own business for literally decades. So I'm hoping you might have some useful advice for me. I'll try. My wife and I have been married for a few years and, frankly, I refuse to merge our finances. because I find her financial habits to be pretty chaotic. And it's largely a function of her work. She is a real estate agent and has been doing that for over 10 years. We try to speak about this a few times,

Starting point is 00:22:33 but it generally ends in tears and not a whole lot changes. So I'm just looking for any helpful advice you might have on how to untangle the business from the personal life and, you know, how to make meaningful changes in that regard. Okay. Now, you understand that when you sell real estate, your income, by definition, is straight commission and is chaotic. Yes, I understand that. That's not what you're talking about.

Starting point is 00:23:07 No. Okay. No, I'm not talking about, like, the fluctuations in the income. Okay, all right, just making sure. There are certainly fluctuations. Okay. No, I just mean, like. So basically a real estate agent is what we call 1099 or an independent subcontractor.

Starting point is 00:23:22 So they run their own business. Each real estate agent runs and owns their own business and has to pay taxes as a sole proprietorship or some of them actually build an LLC for a crew, for a team. And so what she should do, and any time you open a business, even if it's a solopreneur, a single person, is you open a separate checking account. for the business. It can even be just a, it can be a sole proprietorship. It doesn't have to be incorporated. You don't even have to get a tax number. You can use your social security number.

Starting point is 00:23:57 So it would be Wayne's wife, DBA, doing business as Wayne's wife's real estate, okay, whatever the name is, right? And it's just open in her social. And you can put your name on the account as well, but they have a separate account. then 100% of the business expenses only come out of that account. So when she gets ready to pay her MLS dues, her real estate dues, when she gets ready to buy signs or ads or, you know, pay for a drone to get ready to stage a house,

Starting point is 00:24:34 whatever it is that she's doing to sell the house, those are business expenses. groceries do not come out of that. Electricity for your home does not come out of that. It's only business expenses, and business expenses never come out of the personal account. They need to be separated. This is good business regardless of your frustration. Yeah. Okay?

Starting point is 00:25:00 Because it's very difficult for her to do. Or taxes, if you have to go and unravel your personal checkbook and pull out your business expenses one at a time at the end of the year. Yeah, and that's what she's been doing. I know. That's what most of them do, and it sucks, okay? Yeah. And it's horrible.

Starting point is 00:25:18 So, you know, one of the things, when we're coaching Ramsey trusted real estate agents, we teach them to run the back office, so to speak, the business aspect of their business. And part of that is basic accounting. So if you only take business expenses out of that account, and the only thing you put into that account are real estate commissions, By definition, what's left in that account is called profit. And out of that profit, you can leave some to cover some of the expenses next month, and you can bring some home.

Starting point is 00:25:50 When you bring some home is when I would hold back a fourth of it for taxes. Because you've got your income taxes and you've got 15.3, both sides of FICA. Yeah. Okay. And so you set aside 25%, you're going to be really close unless she's making a half million a year, and then it's not enough. But if you say it's at 25% of your money you pull out that's profits into another account, then she can file her quarterly estimates, which she's probably also not doing. Yeah, not.

Starting point is 00:26:21 And getting penalized every stinking year for not filing the quarterly estimates. It's costing you a lot of money this disorganization. Okay? It's costing her a lot of money. Yeah. Just because, you know, just because we're not doing. And this is sixth grade math. It's just a matter of the discipline of separation is all it is.

Starting point is 00:26:38 So we run the business over there like we're running it for someone else emotionally. And then when it has some profit, we take some out, bring it home, hold the taxes out, and then we've got some money to add to the household budget and the household goals. But until that happens, until there's a profit in that account, she's not made money in the real estate business. How many houses she's selling a year? I'd say 15. She's making a little money. She's not making much.

Starting point is 00:27:10 Yeah. Her expenses are eating up a bunch of that. But we don't even know that because we're not doing a good job of keeping the accounting. Yeah. Yeah. So this is an accounting and a business acumen, a business function. Now, I don't know how to emotionally get her to do that, but that's the proper way a residential real estate agent should handle their business. Or for that matter, any solopreneur out there.

Starting point is 00:27:37 Yeah, and my advice is, is I have to bet that, Wayne, you're the nerd of the family. I think that's safe. And I think that if she's open, if she's open to you helping, you do exactly what Dave just told you to do, and you lead on this. And it sounds like the tears, the stuff that keeps coming up from the tears is just the frustration between the two of you on this. So I think Dave just gave you a very simple but actually effective blueprint. And this is where you come in, not like the guy on the white horse who's the hero makes her feel bad, you know what, babe, I've not supported you the way I need to support you. And I can do this. I'm wired for this. I called Dave. I got a plan. And if she doesn't have any problem with this,

Starting point is 00:28:16 I think this is easily solved. But you've got to lead. She may not be confident of her competence to do this. And that would be true of a lot of people. So, yeah. And there are some nerds that sell residential real estate, most of them aren't. Most of them, I mean, this is an industry that has glamour shots on their business card. Okay. So this is usually not a nerd, right? And so.

Starting point is 00:28:49 At times, I've seen Boas. Yes, I have seen that too. We're not talking the constrictor type, yeah. No. But the, yeah, the, yeah, it's, so, so it may be that she's not got the detail wiring that you have, or even that I have, that'll force you to do that in order. to get the business run properly. But, you know, if she's wrecking the car and you can help her drive it and she's willing

Starting point is 00:29:17 to let you, then that's a cool idea from Ken to come alongside and support rather than stand back and throw grenades and go, wow, you really are stupid about this. Well, it's spoken from experience, and I'm really glad, David, you just made this point. To our broader audience, here's you need to understand, especially if you're in a married situation, you're trying to figure out finances. I'm not wired like Dave. And so when I heard Dave what you just laid out, the free spirit creatives like me do thrive with a very simple, repeatable plan.

Starting point is 00:29:48 That was a simple, repeatable plan. Every time you sell a house, you get a commission, this is what you do and you laid it out. But for those of you that are the nerds and you're married to people like me, I know we frustrate the absolute snot out of you and you're right to be frustrated. But it's very key to point out we are not doing it. In this case, I don't believe Wayne's wife is doing this to drive him nuts. She's not wired that way. Dave used the word wired.

Starting point is 00:30:11 It's really important to understand that that spouse will play ball with you if you give them the structure that they need, which comes with its own accountability. You don't have to be accountability if you give them structure and a repeatable process. And that's the magic of what Dave did decades ago with these baby steps. But in that advice he just gave, that will bring a lot of relational harmony around money if you want. if you understand that your spouse just doesn't even think the way you think, therefore all that process stuff that Dave just laid out, it never enters into their mind that's how to do it. And I just,

Starting point is 00:30:45 I think there needs to be grace there because I know what that's like. I'll tell you what enters into my mind when I'm doing that, because I'm a great salesman. Yeah. I always think I could just out-earn my stupidity. Oh, yeah, I'm the same way. I'll just, I'll just go make, I don't need to add all this up. I'll just make some more.

Starting point is 00:31:00 That's right. Then I don't have to deal with it. Yeah, that's how I used to try, and it doesn't work. It's really a very immature thing, but a lot of salespeople think that way. The calendar might have flipped, but the way to win with money hasn't changed. Living on a budget, staying out of debt, and building wealth intentionally. Now, here's the deal. Most banks make their money when you don't do that.

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Starting point is 00:32:55 How you going? Better than I deserve. What's up? So I recently, maybe not recently, a few months ago, came into a large inheritance from my parents. Wow. And I'm just wondering what to do with it. Sorry you lost them. Thank you.

Starting point is 00:33:11 How much did you get? Around 450,000. Cool, cool. So how long have you been listening to us? Probably maybe about a little less than a year. Okay. My brother's a big fan of you. Okay, well, thank you.

Starting point is 00:33:28 I was asking because I didn't know how far to go back to give you the answer. But so we would walk you through the framework called the Baby Steps. with that money because we believe and we know that if you follow through and handle money properly after that and during that, that it will be the way that this money gives you the most lift. Okay. And so that means do you have any debt except your home? So we actually just sold our home. That's where most of the money was tied up.

Starting point is 00:34:02 And so right now I'm renting and I have no debt I just graduated college. Okay. Cool. And how old are you? I'm 23. Wow. Okay. So we sold our home. That was your parents' home, you mean? Yeah, it was my parents were separated, but it was my mother's home, and it had a lot of my father's money tied up in it. And so me and my two brothers sold that house six months ago. And your part is $450,000?

Starting point is 00:34:33 Yes. Okay. All right. And you're 23. Are you married? I'm not. Okay. And what do you make a year? Right now I make $75,000 a year. Good for you. Okay.

Starting point is 00:34:46 Thank you. What is your plan over the next few years? Where do you plan to be? So right now, I'm just, I'm just renting with my brother in our hometown. And I plan, so I'm working in the city, and I live in Long Island, and I'm planning to move to the city sometime in the future, maybe about a year. So I just have all of that money that I got from the house that I didn't have previously just sitting in a CD right now, which pays my rent every month. Yeah. Okay. All right. Not a bad move, for the first move anyway. That way you didn't go do

Starting point is 00:35:27 something stupid with it, right? And so... Yeah, I'm not trying to. Yeah. What do you do for a living? I work in financial technology. Okay. Good. Good. Good. Well, you're very early in your career, so I predict your income will go up pretty dramatically in the next seven years. Would that be a fair prediction? I'd say so. Yes. And I also predict that the $450,000 could grow a lot in the next seven years. Like if it was invested at market rates, it would double in about seven years and be about $900.

Starting point is 00:35:57 $450 will not buy anything in the city. Would you agree with that? Yes. Not paid for. I mean, you could put it as a down payment, but you couldn't pay for it. and you don't really make enough to pay a payment and put $450 down in the city hardly. So you're probably renting if you're living New York Manhattan lifestyle, right? So right now I'm on Long Island.

Starting point is 00:36:17 I know, but you said you're moving to the city. Yes, but I will be renting, yes. Yeah, that's what you told me. Yeah, so I'm projecting what to do. In other words, we're not going to use this to buy a house because we can't pay cash for it with your current plan. Absolutely. Okay. So given that, I'm going to tell you to go to ramsysolutions.com, click on SmartVestor Pro,

Starting point is 00:36:36 sit down with one of the people that we recommend and start learning about investing, okay, and put it in some good growth stock mutual funds and continue to keep your dadgum hands off of it. That's been very wise on your part, very wise, beyond your years wise. And so leave it alone, leave it alone, pretend like you don't have it. And just use your income and live off your income barely, which you barely can living in the city, okay? and just let this money grow. Because if you don't touch it, it will double every seven years. Sounds good to me.

Starting point is 00:37:14 That's about the averages, okay? Now, so the S&P 500, have you ever heard of that? Absolutely. Okay, that's basically the bellwether, the mark of what the stock market has done, closed the year for 2025 up 16%. It closed the year of the year before, up 26%. It closed the year before up 25%. It averages throughout its lifetime a little over 11 up close to 12%.

Starting point is 00:37:44 That's the average. But in the last three years, it's done 67% total. So while you had this sitting in a CD making 3%, it should have made five times as much. Okay? So I don't want you doing that next year. I want it to be in a good investment instead of in a CD. Understood. So go over there and learn about it with a good smart investor pro, and don't put money in something

Starting point is 00:38:12 because I said to or someone else said to, but because you start to understand it. And I've got a feeling after talking to you, you'll be able to understand it. I think so. Yeah, this is a mass. Don't forget something. This is a massive head start for you. And so when Day's preaching discipline, it's because we realize how much of a massive head start This is for a 23-year-old who's very upwardly mobile in his profession.

Starting point is 00:38:36 And you're just leave it alone. You're so wise. I mean, you didn't call me up to say I need to buy a Lamborghini. You know, I mean, because I would have smacked you sideways. I mean, you know, for your own sake, you know, you're just a sharp 23-year-old. And, you know, I'm talking to these guys like this is why I've become such a huge fan. And I've got them on our team here of these Gen Zs. There's so many of these Jackson's in the Gen Z.

Starting point is 00:39:01 It's right. You know, I'm not saying he should do this, Dave. I'll throw this out and see what you think about this. But my head, when you were talking, I tried to put myself in his position at 23, no debt, and now he's going to be in really good shape. I would say a small amount of money. I would consider a small, but enough to make an impact, give it to somebody. Oh, yeah. Yeah, sure. I think it's so really rewarding when we come into money, whether we earn it or it's a gift, and to think about how. to bless somebody that you would not have been able to bless before, I'm going to tell you, it's a really great way to begin to appreciate the power of money, not just from compound interest that we teach, but as you teach, and you've been making it so clear for so long, live like no one else so that later you can live and give. And that is such a key thing. And in this case, I think he could bless somebody with some of them. I think that'd be a brilliant idea. Kyle is in Atlanta. Hey, Kyle, how are you?

Starting point is 00:40:00 Hi, how are you? Better than a lot. I deserve. How can we help? Yeah, so I'm actually post-college. I graduated about seven months ago. And currently, my situation is I have two credit cards. Now, I know that that isn't great. And however, I am looking at an opportunity to consolidate those to one credit card that is attached to my current bank with a much lower interest rate because I want to pay it off and be done with it. I don't want to deal with credit cards anymore. What's the balance on the cards?

Starting point is 00:40:29 One of them is $2,300, and the other one is a little shy of $1,200. Okay. And what is your current interest rate? From what I was understanding yesterday, I think it was 20. And what is the new interest rate? The new one's 6 to 8%. Okay, all right. So you're going to save about $350, $375 a year.

Starting point is 00:40:51 Right. That's okay. It's not bad. Yeah. But it doesn't fix a $3,500 problem. You know, it fixes a $3,500 problem? Kyle? You. Right. You're the secret sauce, not consolidation. The problem with consolidation is you think you did something. You move $375 around. That's okay. If you hand it to me, I'll take it. I'll go

Starting point is 00:41:13 by dinner. But it doesn't fix your problem. What fixes your problem is you get pissed off about these cards. You cut them up and you swear off of them forever and say, Samuel L. Jackson, what's in your wallet? Right, right. You go get your own stinking life and you get these stinking things paid off. What do you make a year? So not a ton. So post-graduation, I make 17 a year. Good God. You're at the poverty level. What did you get a degree in? So I should get a degree in film and television, but that's not what I'm currently working in. Okay. All right. I want you to get six jobs, Kyle.

Starting point is 00:41:49 It's not a joke. In Atlanta, which is one of the hottest areas for film and television, you could be making way more than that, just as a great job. lighting grip, sound something or other, just get on a set somewhere? Just a grunt. Not even a grunt. Oh my gosh, that's incredible. That's awful, Kyle. Kyle, you don't work much.

Starting point is 00:42:10 No. You need to work more. A lot more. Like all the time, Kyle. And that's going to solve this. You cannot hack your way out of credit card debt. You have to earn your way out of credit card debt. There is no hack.

Starting point is 00:42:22 There is no easy button. So, yeah, consolidate them if you want to, but don't act like you did something. If you're waking up tired every morning, you don't need more caffeine, you need better rest. And that's why Casper mattresses are engineered to help you sleep deeper and wake up refreshed. And this isn't just one Georgia's opinion. Thousands of five-star reviews prove it. Plus, Casper mattresses ship-free and come with a hundred-night trial. So you've got nothing to lose.

Starting point is 00:43:06 Sleep is a must, and you deserve the best. So go to casper.com slash Ramsey and use promo code Ramsey for 25% off mattresses and 10% off everything else. That gives you up to $1,200 off the snowmax mattress, which is the exact one I sleep on every night. That's casper.com slash Ramsey, code Ramsey. Exclusions apply. Welcome back to the Ramsey show in the Fair Winds Credit Union Studio. Ken Coleman, number one bestselling author, host of the front row seat, one of our big hits on Ramsey Network. He's my co-host today. Open phones at AAA 825-225. Heather's in Fort Myers. Hey, Heather, what's up? Hi, how are you? It's an honor to speak with you.

Starting point is 00:44:02 You too. How can I help? Yes. Okay. Dave, I am rebuilding my life after my husband of 30 years walked away from our marriage. Wow. Since then, yeah. Sorry. No, it's okay. Since then, I have furthered my education and I received my nursing degree. Good for you.

Starting point is 00:44:26 And there's a lot more backstore, but we don't have enough time for that. Good for you. Thank you. I'm 54 years old, and I'm single, and I work as a registered nurse. Yearly, I am making 90K. Good for you. I have just under 100K in my work, 403. I contribute 20% and my work contributes the 5%.

Starting point is 00:44:55 And in my high-yield savings account, I have 170. D-K. I have zero debt, no student loans. However, I rent because I'm just not sure at this point in my life, like what my next step is going to be where. Yeah. How long ago was the divorce? You know, it's been four years. You're amazing. You've done a great job recovering. Congratulations. Yeah. Well, it's definitely been a...

Starting point is 00:45:26 Oh, it's unbelievable. It's a tragedy, but yeah, but you pulled it off Warrior Girl. Well, you. Well done. Thank you. Thank you. Cool. So what's your question? So, I mean, my question is with what you know of my finances right now. And if I, because I really haven't been saving much money as much as I could be because I think I went through a period of time where I was spending, you know, spending my money because I knew I had the money. and you know, you were medicating.

Starting point is 00:46:01 It's called retail therapy. Yeah, that's okay. That's exactly. That's in the rear view mirror. And I helped people. Yeah. Yeah. Good.

Starting point is 00:46:09 Yeah. So I'm really this year, I'm wanting to maximize as much as I can. I love it. So I want to, you know, maybe own my own home or condo. But I just don't know at this point, you know, where am I going to be? Am I going to stay in Florida? Am I going back to Tennessee? Because I lived in East Tennessee.

Starting point is 00:46:28 Mm-hmm. So what would you recommend? What more can I do to secure my future? And am I going to have enough money to retire? If I, you know, I don't know if I'll have plenty of money to retire. You're going to be fine. You're going to retire a multimillionaire. Okay.

Starting point is 00:46:46 Okay. That's what the math says. I don't just make that up. The math says that, okay? So let me walk you through. There's two things that we need to do. We need to maximize investing and we need to get a house and get it paid for. Yes.

Starting point is 00:46:59 Okay. And that's definitely what I want to do. And so if you're 11 years from today and you're sitting in a paid-for house and you've been putting away $25,000 or $30,000 a year during that time, you're going to have millions of dollars. All right. Okay. So, and the way you'll know that is you need to sit down with someone and help do the calculations and help figure out how to do the investing and what to do. The only question on the horizon is which city you're going to be in. And as soon as you make that decision, buy a house.

Starting point is 00:47:27 Yes. With that 170. Well, it's either going to be the Cape – It's either Florida or East Tennessee. Possibly. Yeah. So, I mean, once you decide, and you don't have to decide today on this call, but once you decide, take the 170 and go buy a house.

Starting point is 00:47:42 Okay. And then sit down with a Ramsey SmartVestor Pro. Go to Ramsey Solutions.com. Click on SmartVestor. Find someone in your area. You sit down and talk to them. In order for us to send people to them, they don't work for us. Okay.

Starting point is 00:47:56 They're independent people. they're in the investment business. I'm not the investment business. I'm in the education business. So, but in order for that, they have to have the heart of a teacher or they don't get Ramsey the name on them, okay? Meaning they're going to teach you how to do this investing. You're going to understand it and you're going to decide. But if you put this in good growth stock mutual funds and you average market returns, you're going to have, you know, several million dollars going into your 70s and a paid-for house. Okay. If you stay diligent to stay on this. Yes.

Starting point is 00:48:30 If you go back to retail therapy and start blowing everything, then no. You can't act like you're in Congress, right? Correct. But I don't think you're going to because I think you just went through a tragedy. You went through a horrible time. You've got that in the rearview mirror. You've worked your way through all the parts of that. And now the future's bright and we need shades.

Starting point is 00:48:52 Yeah. And you're young. Yeah. And I mean that. And I think here's what I would encourage you. This isn't a challenge. You don't need to be challenged. But I would encourage you to make the decision about where you want to live based on what kind of life you desire.

Starting point is 00:49:09 Not a safe choice because I'm from East Tennessee. And again, I'm not anti-East Tennessee. I'm sitting next to, you know, Mr. Tennessee here. I love Tennessee. I want to be here for the long haul. But I do think in someone in your position, having come through a. what you've come through and financially you want to be when you're 65. That's, you got to choose your future because you actually are in a position to do so because

Starting point is 00:49:35 of that great degree. Yeah. And now you are highly sought after anywhere in the United States. So choose the place you want to be and then let the rest of the future take care of itself. Because financially, you're going to be fine if you do what you've been doing. Yeah, you keep making this kind of money and you start socking away $30,000 a year, which you can do in either one of those locales. And you can even make more if you wanted to, if you wanted to work more, because there's all kinds of ER opportunities and everything else for you to go get, you know, you can just work all time if you want to.

Starting point is 00:50:04 And I'm not suggesting that, but if you want to pile up some money, you can do it in your world. That's the beautiful beauty of that degree. You can work all the freaking time. That's the truth. And you get some bargains in Florida right now. It's resetting. Real estate is resetting in some parts of Florida. Really?

Starting point is 00:50:19 Okay. Not complete, you know, not a crash, but we're seeing some prices that can be favorable. And again, you teach this, you know, if you get it. in, in a soft moment, I don't think Florida's going to be long term a bad place to invest in a house. Yeah, yeah, absolutely. Absolutely. Very cool. So I mean, like, Ken, you remember during COVID, we had these travel nurses coming in here. Oh. And they were, they had worked like a year on the road during COVID. They were getting COVID pay and travel pay. And they were making like 400 and 500 grand as a nurse. I was on with you one day when we took a call from a gal who had made

Starting point is 00:50:52 about that kind of money. In one year. One year. Yeah. It's not, it's not out there today. But, I mean, they were getting COVID money, like battle money, right? Yeah. Like battle zone money. And they were getting travel money both. And because, you know, it was crazy. And they were just loading up, man. There's two or three of them we talked to that had, you know, I had $200,000 in student loan debt.

Starting point is 00:51:11 I paid it all off this year and put $300 in the bank. You know, like, what? Wow. So it's just a wonderful career field because it gives you lots of opportunities and choices and things. So. And, you know, when you go through something like a divorce after 30-year marriage, recovering from that is not a bounce back. No.

Starting point is 00:51:33 That's a claw out. Oof. Yeah. I mean, that's a healing process to get to where you're as solid as she is talking to her. Yeah. And she's solid. Yeah. Very, very neat.

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Starting point is 00:53:03 really needs it. Third, stay-at-home parents need life insurance, especially those with young kids. People don't realize how quickly the call sat up without someone at home taking care of things. So no more excuses, folks. Get the protection your family needs. Go to zander.com or call 800-356-4282. They've been my choice for all my insurance for over 25 years and are the only people I trust. Jessica is in Dallas. Hi, Jessica, how are you? I'm doing well. You're breaking up.

Starting point is 00:53:55 Try one more time. I'm doing well. How about yourself? I'm doing good. Your phone's not. How can we help? Yeah, I was just wanting to just get some advice on what's realistic and what's not. It just needs like an outside.

Starting point is 00:54:18 Outsider opinion. About what? I'm wondering what would be, what's a realistic time frame of having a business operating before you shut it down due to not having it not be profitable? Okay. What kind of business? It's a lawn care business. It should be profitable the first month.

Starting point is 00:54:47 Why isn't it profitable? I don't know. Not a lot of jobs coming in, I guess. Okay. All right. So we have a lawn care business, but we don't do much lawn care? Right. Okay.

Starting point is 00:55:05 Why? Well, I mean, I live in an area where there are water restrictions, so really you're not allowed to water your lines. So there's a lot of dead grass. A lot of people just aren't. So you don't think there's people in the area making a living in lawn care business in Dallas, Texas, where there's water restrictions? Well, no, I see people out there on that. I lost all of that.

Starting point is 00:55:46 Try again. I do see people, other lawn care companies out there. mowing lawns and working, I just don't know why it's not working for us. Who's us? I feel like we've been too hypothetical. Let's get real brass tax. This is your husband's business, right? Right. How long has he been in this dead zone of business? It's not doing well. How long has it been going on? He started the business when I was five months pregnant and now our business.

Starting point is 00:56:24 babies about, no, no, let me ask it again. How many calendar months has it been a year or two years? How many years has the business been struggling? How many years? A number? Like the entire, the entire time. Like when you say struggling. Good God. How many months? I'm just asking for a number. How many years? Like 20 months? 20 months. 20 months? Okay. So two years. You've had two seasons and he didn't make a living. I just feel like there's more underneath the surface here. I don't know if we can identify it. You're asking us for some magical answer as to what does the business book say? But the bottom line is, is that if we can't pay the bills with the business. There's no reason to have the business.

Starting point is 00:57:07 Yeah, he needs to go work for somebody who will pay him. Long care is not a hobby. So we need to make a profit. And really, honestly, you should make a profit the first time you cut a piece of grass. There's really not that much to it. I mean, just work your butt off is the problem. It doesn't sound like he works much, is what it. sounds to me. Yeah. Are you saying that under all this? Your husband doesn't work very hard.

Starting point is 00:57:32 Well, yeah, he only does a few jobs a week. Yeah, that's a problem. Yeah, I think he needs to get a job. Yeah, and so is lawnmores, yeah. Because I don't think he's got the stuff to go get the business and keep the business and get up out of bed and go do the business. That's correct. And so until he gets that stuff going, you have to be what we call a self-starter, hello. And, um, we're not talking about his lawnmower. We're talking about him. And so, yeah, you need to sell the equipment and go get a job because of what you're describing there.

Starting point is 00:58:06 But no, there's not a magic when do you know when to close a business. You close a business when what you're doing is not working and there's no visible hope of it getting better. And based on what you're telling us, nothing has changed here that's causing this to trend upward in a good direction. it's just kind of stuck on not so great. And this is not a business problem. This is a, and I'm not saying this with unkindness.

Starting point is 00:58:33 I'm telling you he has a problem. Because here's the reality. Somebody who's healthy or remotely healthy. If they've got a business and they only have two jobs a week, they are working other jobs while trying to get that going. That would be called a side hustle if he's healthy. So something's going on inside of him. with him that is the source of this problem.

Starting point is 00:58:56 It's not the lawn care business, and it's not the watering restrictions. Now, that's the hard truth, but that's the reality of you two have to have a marriage conversation. Yeah. Throw out the Nintendo. Yeah. I mean, am I right? Dave, you've done this a long time.

Starting point is 00:59:12 There are reasons why a guy won't get out and work. There's something. There's always something there. I mean, it's not my generation, but some generations I hear have a Nintendo problem. call of duty but the wrong call and the wrong duty yeah oh well done yes well played dave it's almost like you have a radio show steve's in washington hey steve what's up hey jones uh thank you pick him a call sure man well how can we help yeah first of all thanks for being you you both impacted my life greatly so thank you i really appreciate it yeah hey so i've had the privilege to um

Starting point is 00:59:52 I started over in life. I just got remarried and just to a wonderful woman. But until June, we have to live separately because I made a commitment to stay in my area into my daughter graduates, and then we'll connect. So we did our real first budget meeting on Sunday, and we're doing the every dollar app. How far about are you? How far part of y'all? Four and a half hours. Okay. And what does she do for a living? She works for the Department of Justice. Okay.

Starting point is 01:00:24 And what do you do? Self-employed, and I work two days a week part-time as an EMP firefighter. Okay. All right. Okay, wow. Yeah. All right. So you've got four months of, wow.

Starting point is 01:00:37 What's your business? It's the weirdest newlywed year ever. Yeah. Yeah, yeah. No, so they're working out of debt, and I carry a little bit of debt into this. But my business is property management. I oversee a 600-acre private ski resort. So who's moving?

Starting point is 01:00:56 Who's moving in after June? You? Yeah, I will be moving. Oh, oh. Going into the D.C. metro area, huh? Well, no. Or Northern Virginia? No, no.

Starting point is 01:01:07 She works out of the Portland office, and I'm going to be. Oh, they're in Washington State. Oh, you're in Washington State. I apologize. Okay. Yeah, Washington State. Yep. And she's going to be transferred to Billings, and so we'll have that confirmation.

Starting point is 01:01:19 And, and, and, you'll have that confirmation.. March. So it's, yeah, there's a lot of little things to figure out one step at a time here. How can we help? And yeah, so we're figuring out, like, how do we, I guess, communicate well, as we still live separately, but trying to, you know, as we become one, you know, budget together. And as we're putting each other on each other's bank accounts and then eventually it would become one, we figure probably best after we move in June and but right now just like

Starting point is 01:01:52 I'm I bring in I got under $8,000 to go to be debt free and she is debt free but at the same time I carry a little bit of shame like I brought this in and I don't feel like

Starting point is 01:02:06 I can we can pay it off but also at the same token we are married so we can pay it off that's what goes with it right and that's just the deal. Sorry, that's the way it works, man. For rich or for poorer, for sickness and health, and if she gets the flu, you'll bite and make chicken soup. It's the way it works out.

Starting point is 01:02:24 Yeah, absolutely. So, yeah, I don't know, any advice, I guess, in that realm. And remember, yeah, this is an awesome blessing to be in at the same token. I'm like, how do I do this as well? Yeah, y'all figured out a real strenuous way to do it, that's for sure. Yeah, no kidding. And so, yeah, the only thing I can tell you is that what you're trying to do is difficult at best when you first get married living in the same house.

Starting point is 01:02:50 And now you just added like a 10x to it by not being there. So the only way I know to cover that is with piles of communication. Like overcommunicate feelings, over communicate details, constantly be working on a stupid budget like it was a, because that's going to give you a place to talk about all this stuff. So like every night we have a budget meeting on the phone about every dollar. And every night you talk about it a little bit, I feel a little bit of a little bit of ashamed about this, but I'm still going to work through it, we're going to do it together. And every night, and just lots and lots and lots and lots of talk.

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Starting point is 01:04:35 Go to Churchillmortgage.com today and start your plan. This is a paid advertisement, NMLSID 1591, and MLSConsumerExus.org, Eagle Housing Lender. Oh, somebody's listening. Hmm. So I sat here on the air about, James, how long ago was that? We were talking about real estate fixes. That's probably a month ago. Oh, yeah, it was about a month ago.

Starting point is 01:05:14 Yeah, probably right after Thanksgiving. And this is being recorded the first week of the year. So I said, listen, there's a couple things we can do this housing market. The problem with the housing market is there's always been a shortage of inventory for the last two decades, really. And the shortage of inventory has caused the market to get stopped up. And there's a couple things we could do to loosen the inventory. And one is to prohibit the institutional corporate hedge funds in the Chinese from buying blocks and blocks of thousands and thousands of single family homes and taking them off the market.

Starting point is 01:05:45 I would vote for that. And putting, making them permanent rentals. And so when you do that, you suck out the inventory. And when the inventory sucked out, the market clogs up and stops. And today, President Trump says he will seek a ban on institutional investors from buying single-family homes. Is he listening to the podcast, Dave? I don't know. He didn't call me, Ken.

Starting point is 01:06:05 I know that. He didn't say, Dave, I got an idea. That's huge. You never know, though. You never know. He's famous for watching TV and news and calling in live on show. shows. Maybe he'll call in and you can walk him through how to do it. Well, I just, no, I mean, I'm happy if it's his idea as long as it happens, right? I don't care whose idea it is.

Starting point is 01:06:24 Yeah, this is an idea that's good. The other thing we said, and if you're listening to President Trump, we said this one too, and I hadn't seen this show up yet. Maybe it'll call up in a week or two, two. The capital gains, zero capital gains on personal residence up to a half million dollars married filing jointly has been in place for like 25 years. So here's what you do. Make that $2 million. Oh. I'm so excited. I'm so excited. bunch of boomers that are sitting on a bunch of equity would sell their houses. And that would unclog the market and put a bunch of inventory on the market. Because if you could put $2 million in your pocket and go, you know, to wherever, you know, go

Starting point is 01:06:58 buy a condo or move down, some of the boomers, right? They would do it. But right now they got capital gains on everything over a half million dollars. And half million dollars on a lot of gains is not spit. So if you got no capital gains, tax free up to a half million now, what if you made that $2 million? I'm promising you, it moved the upper end of the market. it open. And when the upper end moves open, then that lives at breathing room and everything dominoes all the way down to the beginning of the market because everybody can move up then.

Starting point is 01:07:25 They're not staccola. Careful, Dave. You're going to give America indigestion because it makes so much sense. And those of you are listening and watching are going, you're right, Dave. That would be amazing. Why doesn't it happen? And you can write these two things down because it doesn't happen very often. Dave Ramsey has a government idea to fix anything. Well, no, that's just good legislation. I know. But I just, the number of times I ask government for help pretty close to zero. Well, this is one of the few things.

Starting point is 01:07:49 Both of these things they could do and it would actually have an impact and it really wouldn't take long. But why won't they, Dave, tell America why they won't. Because they like our tax dollars. Well, I don't know who they is, but somebody. They is all of them up there. All of them. The whole kitten cabood.

Starting point is 01:08:05 It's the machine. The machine. So what we do is, we got to throw the... You sound like a conspiracy theorist, Rachel. No, not at all. Not at all. Throw the bums out until they start giving them. I mean, it's policies like this.

Starting point is 01:08:17 But listen, really quick, I don't want people to miss what Dave just said. These are two very practical things that would absolutely make a huge dent in this real estate clog. Happen immediately. Today's question of the day is brought to you by Y-R-R-R-E-F-Y-F-Y. If it feels like your private student loans have buried your future, Y-R-R-F-R-F-R-E-F-R-E-F-E-F-E-C can help dig you out with a low-fixed rate refinancing. Clear path forward. Go to Y-refi. dot com slash Ramsey. That's the letter Y,

Starting point is 01:08:42 refy.com slash Ramsey, not in all states. Today's question comes from Jasmine in Tennessee. We're out of debt and have just finished building a three to six month emergency fund. I'm anticipating that one of our two cars may need major repairs soon. In general, how do you think about

Starting point is 01:08:58 deciding when to repair a vehicle versus when to replace it? I don't want to panic by another car, but I'm also wary of getting ripped off by a mechanic. That's a really good question. I think that's about as practical of as a fear as we hear. You know, in this situation, I'm not going to spend money on a car.

Starting point is 01:09:20 Let's say the car is worth $2,500, and it costs $3,000 to fix it. Well, you don't do that. You don't do that. You know, other than that, you want to try to duct tape it, keep that thing going. Get yourself a good quality of mechanic. Now, I'm passionate about this particular issue, Dave, because I fall in this category where I'm very suspicious. but we have found through multiple conversations with people that have lived here when we first moved here 12, almost 12 years ago, I talked to several people and tested it out like you would a church

Starting point is 01:09:51 or a doctor or maybe the person who cut your hair when we had some issues come up and we found a really reliable mechanic who we absolutely know is not a thief and a crook and that's important because if you do that, they will help you and they won't try to rip you off. They'll say, okay, here's what could be fixed, but this is the should be. To keep this sucker going from point A to B, that's really important when you're in this hoopty land, because it will get you through it. You can keep a hoopty going longer than you think if you've got an honest mechanic. Yeah, auto repair is a low trust industry.

Starting point is 01:10:23 We were really pumped about having Christian Brothers come on as the official auto repair partner of the Ramsey show. And we trust Christian Brothers Automotive. I've known these guys a long time. They've had a shop in our area, but they've got to shop in our area. We've got shops all over. And whether you're just getting started in the baby steps or your baby step seven, you want your car to last. We recommend Christian Brothers Automotive. Go to CBAC.com slash Ramsey.

Starting point is 01:10:47 I'll work that end of the thing here. They just came on board with us. We're really glad they're here. The answer to your question, Jasmine, is whatever the car is worth as salvage, not fixed, plus the repair cannot equal more than the value after the repair. So if the car is worth $1,000. and it takes $3,000 to fix the car. At the end, that's $4,000, but the car is worth two after you fix it.

Starting point is 01:11:16 Well, you don't spend that. That's good money after bad. Okay. But you also look for, you may be sitting on a $12,000 car, blew an engine. You don't go to the dealer and buy a brand new engine from the manufacturer. That'll cost more than a new car. for God's sakes. No, you get a used engine, a rebuilt engine, or used engine from a salvage yard, and you have someone like Christian Brothers install it.

Starting point is 01:11:43 And you can do that for about 25 cents on the dollar of what I'm talking about with the dealer. So it depends on what the car is, what the size of the repair is, as to all of that. But by and large, it's a car under $5,000 is the only one you would hardly, most always will fix it otherwise. Because you can find an inexpensive way to get it rolling again, even if you fixed it to, sell it. You know, even if you fix it and say, okay, now it runs, now I can sell it for, you know, $4,000 instead of $1,000. And so, but it costs me $1,000 to fix it. Okay, that's good. That's a good investment, right? So we can go that way. So if you're looking for Christian brothers, it's C-B-A-C-com slash Ramsey. They are now the official auto repair partner of

Starting point is 01:12:24 the Ramsey show. John's in Naples. Hey, John, what's up? Hey, how are you guys doing? Better than I deserve. How can I help? So I'm just trying to get my financial future started, and I'm having a lot of issues with that. I have a little bit of student loans I want to pay off, but I have a little untraditional background with school and, you know, how I got to where I am today. And I'm just kind of struggling to get, you know, off the starting line and kind of into the working force and corporate community, whatever it may be to get my future moving in that direction. You have a degree? I do, yes. I have a bachelor's in business and a master's in data analytics. And you can't get a job?

Starting point is 01:13:05 I've done about 2,000 applications. Well, you suck at that. I've met with C-Suite executives, Fortune 500 companies, alumni from my university. I've spoken to my university. I've spoken to friends, family. I've come through just about every avenue that I really know how to, and I really don't know what the problem is with trying to get through.

Starting point is 01:13:32 and, you know, kickstart my career. What's your income target? What are you asking these people to pay you? Usually I'd put on the lower end of what their range is. So I've applied from New York to Anchorage. I've put, you know, anywhere between 80 to, you know, some jobs are, you know, 120 to 150, so I put 120. Sometimes I'd even put under just to try to get through to, you know,

Starting point is 01:13:58 HR to get an interview and it's just not even working. if you had interviews I've had a handful but only because I've had internal referrals have to... Yeah, and that's where they come from. That's where interviews come from.

Starting point is 01:14:13 They don't come from 2,000 applications. Well, I tell you what, hang on. I want to bring you back around because Coleman is about the best on the planet at this and I want him to help you. All right, John's got a degree in... A master's degree in data analytics has applied for over 2,000 jobs

Starting point is 01:15:06 and not been able to get a job. Ken Coleman, help the guy. Okay. All right, John, so you've been applying for things and you've been in the 80 to 120,000 range. I think where I want to start is what is a layer or a level, rather, below where you've been applying? Is there such a thing? Or are you saying that those entry level are yielding those kind of salaries? Those are the entry level.

Starting point is 01:15:30 One of the issues is that I haven't been able to do an internship. I was an athlete in college, and I was training over the summer. So I was unable to go in and actually, you know, made the connections that way. So, you know, when I apply for associate or analyst level, you know, they say, well, he doesn't have experience. And my internal recs who have to fight for me and say, well, you know, nobody at this level has experience because it's the entry level. So that's kind of how they have been able to get me through to interviews. But most companies just don't even, you know, I kind of get an email pretty quickly. Okay. So when you got the interview with the internal rec, what happened?

Starting point is 01:16:07 I made it down to the final two, and then office politics and some other things went on that just were out of my control and just went in another direction. So you told Dave before we went to break that it was a handful of interviews. Is that right? How many are we talking about that you've actually gotten? I've done four for companies that are actually based, like base salary, and I've had a handful that are the commission-based selling insurance, not really something I'm interested in. I've done every avenue from, I've talked to C-suite executives, I've talked to my grad school, my university. Yeah, no, I get it. I've talked to very wide that.

Starting point is 01:16:46 I totally get that, and I want to encourage, I appreciate your activity. But activity in this particular situation is not the answer, just activity. 2,000 applications you might as well have been spitting in the wind driving down the interstate because of the nature of AI and filters and all these things. So what we want to do is, is we want to get more of those interviews, and you've only got four interviews. The conversation with C-sweeters, those don't always yield what you think either, because while they may give you time, I love that you got there. So you got some spunk. But here's the deal. The simple advice for you is this.

Starting point is 01:17:21 You've got to up the amount of interviews that you're getting. So you've only gotten four in your space. So O for four, in today's job economy, not surprising. there's no question that you're up against the fact that you're in entry level. And so it's actually more competitive right now for entry level roles. So there's no silver bullet here other than this idea that I wrote a book around. I'm going to give you the book as my gift to you. It's called the proximity principle.

Starting point is 01:17:49 Now what the proximity principle does is it increases your odds of getting actual interviews. And one of the first things Dave said to you was, how are you doing an interview? So I want to know, have you gotten any feedback from anybody? that's interviewed you to where we don't blame it on office politics and whatever. But any feedback on how you could do better in the interview? Do you have any of that? I've done mock interviews. I don't have any issues with answering the questions.

Starting point is 01:18:18 I don't have any issues with my background. It's just, you know, I don't really know other than the companies I've been fortunate enough because of my internal recs. I don't know why I can't even get through to other companies. You know, I bought software to find out who, you know, hiring managers are. So after I apply, I'll send them an email, my contact information, telling them why I'm applying, I'm following up with them, I'm trying to do everything that I'm told to do. Yeah, but it just doesn't work.

Starting point is 01:18:45 I have a degree. I've had the grades. Just whatever reason. So here's the deal. In the background of being an athlete, it doesn't help. No, not at all. Nobody cares. So listen, I'm just trying to tell you, you got to stop saying these things.

Starting point is 01:18:58 Not even that helps. Here's a simple thing. You have got to connect relationships, and this is hard work. The four interviews you got, you got the right way. We need to do that 40 times and you'll get a job. We have to repeat that process. Not cold calling something off the software and not filling out applications that are spitting in the wind. But here's what I would do today if I were you. You need to be working a job. And I'm talking stock and shelves at Target, NFL MVP, Hall of Famer. Kurt Warner was stocking grocery shells while playing in the arena football league. He did that because he wanted to make it to the NFL. I think it's the same story for you.

Starting point is 01:19:38 You're an athlete? That's why I give you that example. But Kurt Warner only stocked shells because he had to feed the baby and his wife. But he did it so that he could stay in the arena football league. And for you, right now, for you to get in this work, you need to be working, bringing home income, not becoming depressed because that's what happens. You get depressed pretty quick, get frustrating, and you create this false narrative, which will hold you back. So the best thing you can do right now is go get A, J-O-B, so that I'm getting up every day, taking a shower, shaving, and working and bringing home a check.

Starting point is 01:20:14 While I'm using Ken's proximity principle and repeating the process that worked four times and the more, let's say it's eight interviews or 12, you're going to start to see a yes. All of those nose lead to a yes. And I wish I had some silver bullet, but it's a law of numbers, but the right numbers. Yeah. Hang on. We'll get you a copy of Proximity Principle and Ken's book, Finding the Work You're Wired to do. Both will help you in this process.

Starting point is 01:20:40 They'll be our gift to you to help you get moving. I know you're frustrated, man. And it does sound like you're doing a lot of things right. Yeah. But you're also wasting a lot of burn calories to feel like you're doing something right and some other things. So let's re-align some of the efforts the way Ken's teaching. And I think you'll see some better results. I hope you do.

Starting point is 01:20:56 My goodness, that's frustrating. is crud. All right, Jessica is in Dallas. Hi, Jessica. How are you? Hey, I'm good. How are you all? Better than we deserve. What's up? Well, thanks for taking my call. I have a question about emergency funds versus sinking funds. So my husband and I, we learned about you, Dave, in 2020, paid up all of our debt, except for our mortgage. And each month, you know, I'm using every dollar to designate money into different funds. With our house sinking funds, I'm just wondering if I'm using it incorrectly.

Starting point is 01:21:35 I'm getting a little nervous as our house gets older. We're going to need major things like new windows. And I feel like the house funds never really grows because, of course, something always comes up. We need a new water heater or a roof. And so it just seems like every year we're getting money in that fund and every year I need to take some out. And I'm just thinking, you know, years.

Starting point is 01:21:57 a few years on the line, what if we need to spend $30,000 on new windows? Well, you need a plan to do that. That's not an emergency. That's a known thing. That means your sinking fund is underfunded. Okay. But I don't know that you need to necessarily be funding something for 25 years from today and there. But if you think in three years you're going to need windows and it's $30,000, you probably ought to start now.

Starting point is 01:22:27 Well, I'm just thinking I would already have the $30,000 if I didn't take money out of the house fund for repairs. What are you going to repair the house with if you don't? Okay. You have to repair the house and fix the windows, both. Okay. And neither one are an emergency. Both are predictable events. Okay.

Starting point is 01:22:48 So I just mean... You may be needing a new sinking fund for windows. Yeah, that's true. And start, start, because since it's worrying you and keeping you up at night, I don't know. But, you know, seriously, what do you think the time horizon is on that? When do you think you're going to need them? I mean, honestly, we could use them now, but it's not an emergency for us to use them now. You know, we do what we can when it gets cold here.

Starting point is 01:23:12 It's not told in Dallas for very long. But, I mean, it's coming down the line, and I know it's a big cost. So put a number on it and put a date on it and back into it and say for it. Okay. go get a bid or three and say okay 36,000 bucks and 36 months, that'd be a thousand bucks a month. Hello? Sure, yeah. Put a number on it and put a date on it and you can tell what your sinking fund needs to look like.

Starting point is 01:23:39 Because you've got to do the other home repairs anyway, and you can't wait and call this an emergency because you knew it was coming. It's like saying, oh, my tires are bald. That's an emergency. No, you knew your dead-gump tires are going to wear out. You should have been planning to replace your tires all right? Too close to home, Dave. I feel like your Stacy talk could be right now. She was looking at my tire treads about six months ago.

Starting point is 01:23:59 She goes, you're an idiot. You're literally like taking your life in your own hands. I never pay attention to stuff like that. And sure enough, she was right. I'm glad. Thankfully, we had the money for the tires. I'm glad. By the way, windows in Dallas, if it's a little chilly, I'm getting some duct tape.

Starting point is 01:24:12 We're going to stretch this a little bit. I'm kidding. She may live in a $2 million house, man. I don't know what she lives in. I wasn't serious. The duct tape. Can't fix everything in duct tape, 10. You can try.

Starting point is 01:24:27 but you can't fix everything. I don't know. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio. I'm Dave Ramsey, Ken Coleman, Ramsey Personality, host of the Ramsey Network hit. Front row seat is my co-host today. Open phones here at AAA 825-5-225. If you go to Ramsey Solutions.com slash live events, you can join us this evening. We'll be doing a live stream that is completely free to help you get back.

Starting point is 01:25:30 control of your money, take back control of your money in 2026. And we'd love to have you guys join us. There'll be several hundred thousand people there. We'll be giving way $20,000 tonight on that live stream. So make sure you sign up for the live stream. And that puts you automatically in the drawing. The whole deal's free. We'd love to have you hang out. Jade and I will be doing that. So Jade Warshire and I. So make sure you join us. Jennifer is with us in Nashville. Hi, Jennifer. How are you? Well, good. Thank you for taking my call. I am so excited to talk. talk to you. You too. Here's my question. Okay, so I'm hoping to retire in 2032. I'm debt-free with the exception of my house, which I still owe $2,000, at a $2.25 interest rate. My question

Starting point is 01:26:14 is, what should I be prioritizing during my last six years of employment? I would like to prioritize paying off my house, and if I saw my energy and money towards paying it off, I can do it before I retire, but it would be a big expense I'm contributing to my 401K. But others say that since my interest rate is so low, I really need to be putting all my money in my 401K. But that means I'd have to take a house payment into retirement, and that scares a crap out of me. So I kind of wanted to know, I think I know what you're going to say, but I just wanted to

Starting point is 01:26:46 know what you thought. What's your household income? I make $162,000. Okay. And so you have six years, right? Six years. And I'll have two federal pensions when I retire, which are about $35,000 a year, and then if Social Security still around, like, another 30.

Starting point is 01:27:09 Yeah, so six times four is $2.40, right? Right. Yeah, so six times $45,000 out of $160,000 gets your house paid off, which leaves you $120,000. Why can you not keep doing retirement also? Oh, I could. You mean take my house payment into retirement? No, darling.

Starting point is 01:27:34 $45,000 a year, $45,000 a year from today for the next six years pays off a $280,000 house. $45,000 extra on the house. Okay? Yes. All right. Now, you make $160, right? Right. Minus 45.

Starting point is 01:27:55 It leaves you $115. Right. Okay. You could still do retirement and still live. Yeah, I mean, I know $162,000, it is a lot of money, but you know, you got to take out, there's a lot of stuff in there also. When you take out taxes and just everything else that goes with it. What's everything else? Hiving. Well, if you have taxes, which is like $30,000 some $1,000, hiding, my current house payment, which is $30,000. You're what?

Starting point is 01:28:30 You're what? What did you say? What? What? I said my current house. Oh, your current house payment. Okay. Well, that would include your house payment because basically, I mean, $45,000 is more than enough house payment and everything to pay off the house.

Starting point is 01:28:49 You don't pay $30,000 a year on your house, do you? When I think of that, I throw in all of my taxes and insurance. That's what I roll into my house payment. how I think about it. I see. Yeah, you're right. That's true. Okay. Hmm. Okay. I just, it feels like that you can, that you don't have to completely choose. It feels like you can get the house paid off and still do something towards retirement. You may have to cut some, you may have to scrimp somewhere else to hit this goal. I don't know. And I don't know what all is coming out of your check. You may want to look at that. But you may be thinking about coming home after 401K contributions. And that's,

Starting point is 01:29:32 That's, you know, that's not what we're time. Still, that's part of the hole, see. So if you kept doing your 401K and then it's pinchy to do the house, but you could still do 45 total on the house in principal reduction a year, not counting interest and taxes and insurance, right? But, yeah, if you did that, that would get you there. So it's close. What's the probability over the next six years of your income changing?

Starting point is 01:30:00 Well, so it won't go up much. will continue to grow. I do, the other thing is I, I do own a fourth of a farm. It's an irrevocable trust now. And so that's vested. But, you know, I'm not sure when we're going to sell that. You never want to say it like that because it means one of my parents has passed. But so there will be about a half million dollars, you know, income coming in at some point in my And how much is in your nest egg now? So right now, 30,000. Ooh.

Starting point is 01:30:37 Oh, and then my 401K is 480. That's your nest egg. Okay. I knew something was up there. I'm sorry. Can I ask a real simple question? What do you do for the government? What is your job?

Starting point is 01:30:48 How would you describe yourself as a professional? As an attorney. I specialize in labor law. Oh, good for you. And your work for the government? I do. Does that preclude you from doing, side work?

Starting point is 01:31:03 No. Okay. Here's the exercise. Okay, here's the exercise I would go through. I think Dave's right, but I also think you know your budget pretty darn good. So if it was me, I would not be asking the question, do I sacrifice retirement

Starting point is 01:31:18 investing in order to pay this house off? I would be asking the question, how much additional money do I need to make per year over the next six years to pay this house off? You are an attorney. I know you can make that money. Yeah.

Starting point is 01:31:33 If you made an extra $40,000 a year, this is soft. That's one thing. That's one way. You know, it's just a little side thing of some kind of a side, I don't know, venture or whatever. Here's the thing. You're going to be okay. Either way, you're fine. I would pay off the house early.

Starting point is 01:31:47 I would put the house on a schedule to be done in six years. And then I would squeeze what I can out of retirement from working extra and or out of your budget by carefully looking at it, all the things we've talked about. Because here's the deal. You got a half a million now in six years. That'll be, if it's in good mutual funds, that'll double. That'll be a million. And then the house is worth what today? 700 something.

Starting point is 01:32:11 So it'll probably be worth a million and a half in seven years, give or take. Okay. And so at that point, you're going to be worth $2.5 million. And the farm is another half million. And that's six years from today. And you'll be how old at that point? I will be 62. Okay.

Starting point is 01:32:25 And about what, $70,000 in retirement? coming to you from the pension plus Social Security, right? Yeah, so 100,000 if everything stays weighted now. Okay, so you're at 100. That's great. So you're definitely okay if you add nothing to retirement and pay off the house over the next six years to answer your question. Now that we dug all the way through this, okay? But it took a minute to get there.

Starting point is 01:32:50 But that's exactly you are okay to do all that. I, however, am like you, I want to be doing something further towards retirement. and so I want to investigate these other two possibilities, adding some income and or squeezing this budget. But I'm just going to sit down and go, $45,000 a year's got to go on principle. And that comes out of the budget. Six years, I'm done. And you're going to be okay. Make sure your other stuff's invested right in good mutual funds. Hey, George Camel here. So you're thinking about buying or selling your home. It's exciting, but there's a lot to think about. And all those decisions can feel overwhelming. Well, here's the good news.

Starting point is 01:33:59 You don't have to tackle the process alone. Ramsey's real estate home base is the place to find all of your free tools and resources for help to get prepared to buy or sell your home with confidence. You'll find calculators, start to finish guides, a podcast, and even an in-depth video course hosted by yours truly. What's not to love? So if you're ready to take the next steps toward your home goals, go to ramsysolutions.com slash real estate.

Starting point is 01:34:22 That's ramsysolutions.com slash real estate. Buying or selling a home is a big deal. Rates are coming down. Looks like we're going to see 5% or so on a 15 year any minute here. So good time. Good times. A lot of houses are going to be coming on the market as the grass gets green. And it might be yours or you might be looking for a house.

Starting point is 01:34:54 You need a pro in your corner, someone that's high octane and high protein. The Ramsey Trusted program is the only way to find a top agent you trust that we trust. Make sure your home's a blessing and not a burden. Go to Ramsey Trusted real estate. You can find one for free at Ramsey Solutions.com. agent or click the notes or click the link in the show notes. Brittany is in Grand Rapids. Hi, Brittany.

Starting point is 01:35:18 How are you? Good. How are you? Better than I deserve. What's up? I have just a question. I was curious what your thoughts were on if it's a bad idea to pay for our daughter to go to private school while we are still trying to get out of debt.

Starting point is 01:35:38 Yeah. Okay. Okay. Well, that's a loaded question, and there's a lot of answers to it. Yeah. And so the answer is it depends. Number one, I would not strain my family budget to where I couldn't breathe in any case. Okay, to do that. I would not spend $46,000 a year for a four-year-old to go to a private school.

Starting point is 01:36:03 And sometimes I get that call. So what is yours? Yeah. So we are in the process of paying off debt. No, what is your private school cost? It's not that much. We're going between two. The cheaper one is $1,035 for the year.

Starting point is 01:36:20 The other one is like $1,400 for the year. I'm so sorry. This is not a school. This is a daycare, right? No, it's preschool. A thousand dollars a year? Yeah. And she goes every day?

Starting point is 01:36:34 No. So at four years old, they don't do. It's only like one of them is two days a week and the other one's three days a week and they're half days. Okay, darling, this is called Mother's Day Out. This is not called private school. Yeah. Okay. Or run from any school that only charges you a thousand dollars a year. I mean, it's not a school. Your kids go over two days a week while you go grocery shopping, for God's sakes. Yeah. Okay. So, but if you're going to. do Mother's Day out. That's okay. I mean, private, they don't have a public version of that.

Starting point is 01:37:12 So private is your only option. And what's your household income? It's kind of complicated. So I bring home about 2,200 to 2,300 a month. My husband on the low end brings home 2,800 a month. But it could go up to 5,000 a month. When? So he manages a snow removal company.

Starting point is 01:37:41 So like right now he's bringing home a few thousand a month. And then he does land escaping in the summer. So it just kind of depends if he's working overtime or not. Okay. And you're in Baby Step 2? Correct. What's your debt? How much?

Starting point is 01:37:58 Yeah, we have a total of $303,000. Hello. What is that consistent? Yeah, 27. $97,000 is left on the mortgage. Oh, okay. We have $9,700 left on my car, $4,600 left on my student loans, and then $11,000 left on $15,000. So shouldn't he be doing overtime now?

Starting point is 01:38:24 Yes, lots of overtime. Is he? Yes, yep. He's working. The last, like, average was anywhere from 95 to 110 hours a week. And he's only bringing... 2,800 home a month? No, that's when he gets 5,000. Yeah, no, he actually, like last month, I think he brought home closer to 8,000. Okay, that makes more sense. All right, I got it. Okay.

Starting point is 01:38:47 Yeah, I just filled our budget off of the low end. That way there's no, like, surprises. Okay, so are you working in the home? No, I'm a nurse. So who keeps your child while you work? Yeah, so we pay somebody to watch the kiddos three days a week. Oh, and this other thing is the second or the other two days a week. Yeah, so starting in the fall, our daughter is of preschool age, and so we were just trying to figure out whether it was a bad idea to pay for her to go to a private school. If she's there, does that reduce your cost of the babysitter in the house? No, it does not, because it would be Tuesday, Thursday, and those are the days that I'm home.

Starting point is 01:39:34 Oh, well, I wouldn't do it. I've heard enough for me. If it was my personal income in this situation, I would not be paying that money, no. Not in Baby Step 2. Dave, am I right or wrong? I don't have a problem. Either way, it's probably not a deal breaker either way. But, yeah, your daughter's already gone from home as a four-year-old while you're at work the other days. And then you're at home and you're going to send her away from home too into preschool. I, you know, I don't think this, well, I'm a more catch. I'm already catching hell.

Starting point is 01:40:12 Okay. Having raised three that became successful, the things that they learned when they were in preschool did not enter into it, them becoming successful. It's not that big a deal. Okay. And so, you know, you can make it. You can make it. And the differences for some of the rest of you in one grade one through six, one school versus another, assuming the school is not just an absolute hellhole that's dangerous and teaches nothing.

Starting point is 01:40:53 But if you've got a reasonably good elementary school, the differences in that and the one that's $100,000 a year is it's not worth the bank. You know, it's not worth the cost. So, and the differences in whether those kids become successful is not based on where they went to elementary school. And it's sure not based on where they went to Mother's Day out. And so, no, I'm not going to do it on that basis. The child is not going to be held back. She's not a developmental delay because of this or a educational deficit. Yeah, and I'll kind of fill in the last piece that I'm hearing here, Brittany, because I'm not that far removed from my wife working full time.

Starting point is 01:41:31 and we had three kids. So as a nurse, and I know that nursing, many of the nursing positions are very, very intense. So if you're asking this from, hey, on those two days when I'm off, I need a little me time, I think that's fine. But I would, again, I would employ the person who's watching the child on the other days for maybe a portion of it. You have some dedicated time for yourself on those two days off. If that's something that is part of this decision, I think that makes sense and it's healthy. But I can also say as a guy who sent off his oldest to college, last year, I got another one leaving the nest. This goes fast. And the old saying that the, you know, the days are long and the years are short are really, really true. And if you can, you know,

Starting point is 01:42:15 still be healthy, having that time with her before she heads off to elementary school, man, it's going to be here before you know it. I would maximize that. That's just me. No wrong decision here, but maybe some food for thought. Yeah. So the bottom line of all of that, Brittany, is it doesn't matter. You do what you want to. That's right. I mean, you're not going to mess up your kid either way, and you're really not going to

Starting point is 01:42:36 destroy your dead snowball either way. So, but what we don't want to do during, and I don't think this falls in that category or we would sell you because we're pretty mean about it. What we don't want to do when baby step do is buy luxury items, things that aren't needed. And this is kind of on the bubble. But, and you know what bothers me about it is the way you phrased it, honestly. Start the whole thing off like this is a private school discussion, and it's a two-day-a-week Mother's Day drop-off. So, you know, it's not like we're having a decision between Harvard and, you know, the University of Mississippi.

Starting point is 01:43:12 That's not what we're looking at here, okay? So I felt that too, and this is not in any way a slight on you, Brittany, but you know what? Sometimes we make decisions like this because everyone else is doing it. I'm not saying that's the case, but a lot of times we talk ourselves into things that makes sense because other people are doing it. Yeah. Yeah. And it's a bubble.

Starting point is 01:43:37 I mean, who you run around with and all your kids, all your buddy's got a four-year-old and they're all going to air quotes, private school. I'll bet you the school she's thinking about. It's got some nice shine to it. I'm guaranteed. It's the hot place to send the kiddos in their zip code. I'll bet you. I could be wrong. Tapping before, Dave.

Starting point is 01:43:55 Struggling with prestige out of a four-year-old. Listen up, guys, because I've got a big question for you, where will you be with your money at the end of 2026? Will you be better off, worse, or exactly the same? Believe it or not, you get to choose. Look, I know there's a lot going on that can make you feel powerless over your money, but I want you to hear me. You're more in control than you think. You can turn your finances around. So let me help you out. Start your year off with me and Dave Ramsey at our free every dollar live stream event on January 8th. We're cutting through all the lies and all the chaos out there that's keeping you stuck. So you have the clarity you need to finally get ahead. And you could even win $2,000 just for signing up. Listen, a Another year is going to pass anyway. So decide that this is the year you're going to take back control of your life and your money.

Starting point is 01:45:19 Go sign up for the free live stream at every dollar.com slash live stream. Hey, are you staying on track with the baby steps? Take a quick quiz to check your progress and you can get a personalized plan for you as well. Simply head to the show notes, click the link. Are you on track with the baby steps and complete the quick free quiz? And we'll help you build a personalized plan and get you moving. That's what we're here for. Carly's in West Virginia.

Starting point is 01:45:59 Hey, Carly, what's up? Hi, Dave, hi, Ken. Happy to be talking to you. Thanks for taking my question. Sure. My question's about life insurance. So my husband and I know we need more life insurance, but we're trying to figure out how to do that. So right now, through a company-sponsored plan, we have a term life policy that is seven times my income and five times his.

Starting point is 01:46:25 that you pay for or they give? Well, yes, I pay $45 a month for it. Okay. All right. And so I'm trying to determine to fill that gap to the 10 to 12. Yeah. And because this is, you know, through my employer, should I be looking, should we be looking for a private policy for the full 10 to 12?

Starting point is 01:46:47 I probably would. And let me talk you through why, okay? There's a couple of variables. Yeah, just go to like Xanderinsurance.com. They've been with us for 35 years almost, and they'll shop up a zillion companies, get you the best price. For what you're paying, I'm going to guess and say you might be able to get that privately. I don't think you're getting that great a deal. That's thing one, okay?

Starting point is 01:47:09 Thing two is when you leave your company, and you will. Yep. Okay, you'll get fired. That's my concern. Get a better job. If you had a diabetes diagnosis and a year later left the company, company, you can't get insurance. Yeah.

Starting point is 01:47:27 And because these insurance policies are not portable, they don't go with you. And so you can get trapped with a negative diagnosis and then an exit and not have insurance. And that always bothers me. So I look at, I want to have the biscuit, the meat of the thing, so to speak. The main piece be my private insurance through Xander. And then if I've got some through work, if it's a good deal, when you've, flesh it out and you want to keep it. It's kind of the gravy on the biscuit. It's a little extra. Okay. But because good news, it doesn't cost much. But I don't, I don't know that that policy

Starting point is 01:48:05 is that great a deal. How old are you guys? I am 32 and my husband's 27. Okay. And what's your incomes? Um, I'm at 160 and he's about 80. And we have one child who's, uh, almost two. Okay. Are either one of you overweight or smoke? No. Okay. Oh, you got a good amount of insurance because your income's higher than I was guessing. Okay. So you got good incomes. Congratulations. Yeah, I don't know. You just run the numbers against it. You'll either keep it as semi-supplemental. So in other words, I might do, if it's a great deal and you want to keep it, instead of doing 10 to 12 with Xander, I might do 6 to 8 with Zander, right? Okay. And just say, okay, it's a little bit supplemental and it's a little bit there. But if I leave, I'm not stuck that way. And it's not the base, it's not the foundation of my insurance plan. It's just part of the plan.

Starting point is 01:49:06 Because when you count on employer life insurance only, you can really get stung based on what I was just telling you. And Dave was using gravy in a biscuit as metaphor. If you want a good life insurance rate, stay away from the biscuits and a gravy. Ken, thank you. Dave, just, I've got to bring some practicality. once in a while, what you say. You're not plain enough. You're not clear enough.

Starting point is 01:49:27 It's true because, you know, if you eat enough biscuits and gravy, you'll have to have a biscuit ectomy. While you were doing that, I literally was like, oh, I love a good biscuit. That'll screw up your insurance rates. That's what point. Biscuit ectomies, if that's on your medical record, it's a problem. There it is. Larry's in Florida.

Starting point is 01:49:45 Hey, Larry. Hey, Dave. Thanks for taking my call. You have a, see if I'm the, um, the, um, the, um, the, um, the exception to Dave's rule of borrowing money. And then here's a deal. I'll give you a quick scenario. 73.

Starting point is 01:49:59 I watch the 70. We're snowbirds. We have 1.4 in liquid assets, 50,000 of it. Sorry, 1.4 that's in pre-tax. And then another 50. That's emergency fund. Everything's paid off up north. We live in Michigan.

Starting point is 01:50:17 House is worth about 275 up there that's paid off. So the condo, though, You've been staying in Florida for the last five or six years, a perfect one for us. That's going for sale. And I can actually close on it this week, tomorrow, today, whatever. And I'm looking at, my question to you is, do you think it's wise to pull out the condos 360, pull out the entire amount out of the pre-tax? And, of course, that would incur a 20% tax as well.

Starting point is 01:50:52 Absolutely. That's a smart way to. It's not a 20% tax. It's a tax on 360. It's an ordinary income tax rate on 360. But yeah, I definitely would pay taxes on it. It's not 20% is the withholding on it. But that's not accurate.

Starting point is 01:51:05 So, yeah, yes, I definitely. That's why you've saved this money. You don't want to go be 73 years old to have a beach condo with a stupid payment on it. No. No, I wouldn't do that. I definitely wouldn't do that. I pay cash or I wouldn't buy it. Of course, the other question is, are you going to keep the place up north?

Starting point is 01:51:19 If you are, then let's slow down a little bit on the purchase and get the other place. sold and roll that 275 into it because there's no tax on that. But if you're keeping the house up and you're still going to snowbird it, then up north and that's cool. No problem. I just take it out of that. Yeah, so you got a million dollars left in your 401k and you got, you know, a million dollars in real estate now. Okay. Oh darn. I hate it when that happens. Well done. No, I'm not paying, yes, I'm going to pay some taxes to not have any debt. Absolutely. That's why we got here and how we got here. Spencer's in Wisconsin. Hi, Spencer.

Starting point is 01:51:55 Hey, Dave, thanks for taking my call. Sure. How can we help? Hey, I'm 28 years old, and I have $750,000 a debt. And I have no debt on any cars or anything like that. That's my home mortgage, and then I'm a farmer. I bought a chunk of land, so. Okay, so how much is your house?

Starting point is 01:52:21 How much is the debt on your home? Um, there's about 350,000 left on that. Okay. And so you got about, uh, what, 450 on the land? 400 on land, yep. Yeah, 400 on land. I'm sorry, yeah, okay. And you're a full-time farmer.

Starting point is 01:52:37 That's what you do for a living? Correct. Yep, yep, with my dad and my grandpa. Okay. And, um, that's your only debt. You don't have any equipment debt? No, no equipment debt or anything. What do you farm?

Starting point is 01:52:52 What do you farm? What are you farming? Corn, soybeans, and wheat. We're cash crop farmers, and then we do a lot of trucking, too. Good. So what do you make in a year? I personally make about $80,000 of personal income. And then this year we made about $30,000 from the farm that should make the payments for the next year.

Starting point is 01:53:19 How many acres? How many acres is the $400? It only yielded $30,000 worth of profit? Well, no, 30,000 of profit. Yeah, no. It was about, it's 76 acres of workable land, and it yielded about 200 bushels to the acre. Wow. And corn is about $4.

Starting point is 01:53:41 It's about pretty bad price this year, but that's just how it goes. Okay. On a good year, I'm curious, on a good year with corn prices, what would that number be or what has it been? What's the best year that you can recall? The best year is probably that I can remember. I'm only 28, so, but we had a, during COVID there, we had about $7 a bushel. Wow. Wow.

Starting point is 01:54:09 So what would that make you on that of 78 acres or 76 acres? 76 times 200. I'm lost. That'd be about 100,000 or something. Okay. All right. Almost double. Yeah.

Starting point is 01:54:28 Okay. Or more than double. Okay. All right. Because you got it, listen, yeah, you're just trying to get a return on investment. It's a business transaction. There's a lot of romance in farm and an extreme amount of hard work in farming. But people romantically forget to do the math because you don't want to make $30,000 on a $400,000 investment and do all the hard work. It means you're making $1 an hour for backbreaking labor. That's a bad rate of return on your money. So, but if that's not the average year, then we have to work into that and see. And if you're getting it paid off by doing that, you end up with the asset clear. That's another part to enter into the equation. So I think you can struggle through this and get there. When you're tired of feeling stuck with money, there's just one solution. To get different results, you have to do something different. No one accidentally wins with money.

Starting point is 01:55:38 You have to have a game plan, and that begins with our get started assessment. Go to ramsysolutions.com slash start, answer some questions, and we'll show you what steps to take next. Don't stay stuck. Take control of your money starting today. Go with ramsysolutions.com slash start. Our scripture of the day, Ephesians 611, put on the full armor of God so that you can take your stand against the devil's schemes. Reba McIntyre said, be different. Stand out and work your butt off. Well, that sounds good, Reba. I like that. All right, Kim is in Chicago.

Starting point is 01:56:31 Hey, Kim, how are you? I'm good, how are you? Better than I deserve. What's up in your world? Well, my son is going to come into a settlement when he turned 18 in April, and it's $70,000, and I'm looking for advice on what he should do with it. He wants to buy a new car, but he's also going to be signing up. He's going to sign up for the Marines in about October.

Starting point is 01:56:58 So he's only going to be here a short time before he was away to boot camp. So trying to figure out what the right decision is for him. Yeah. Okay. And how old is he? He's 17. He'll be 18 in April, and that's when he'll get the settlement. Okay.

Starting point is 01:57:12 What's the settlement from? He was hit by a car when he was on his bicycle. Wow. Is he okay? He's okay. Yeah, it's been just about a year. So he's fully recovered, and it's, you know, been in an account in the bank until he turns 18.

Starting point is 01:57:29 So he's anxiously awaiting it to buy himself a car because right now he's sharing with mom. Okay. So you're a single mom? I'm a single mom, yes. Okay, all right. And he doesn't have a car and he's 17. It's in the bank. Right.

Starting point is 01:57:45 Is there any reason he can't buy a car with it now if you let him? Because he can't, it's not to be touched until he's 18. I mean, we can go and petition the judge for it. Oh, okay. But that'd be the only way. Okay. Right, it's the only way. Right.

Starting point is 01:57:59 Okay. All right. You're a good mom. Well, here's the thing. You and I know he's getting ready to park the car. And if he's a normal 17-year-old American male, he wants a really nice car that's way too expensive and he's about to screw up, right? He wants a Honda Civic. Okay.

Starting point is 01:58:25 But how new? That he's open-ended on. But here's thinking I'm thinking five to $10,000. Okay. That's what I was thinking as well. Okay. And if it parks and sits there and rots down, his life does not end. But if he goes and blows $70,000 on a car, I'm going to kill him.

Starting point is 01:58:45 Oh, no. That would never happen. Well, I don't know. He's 18 and it's his money. Only you and I can talk him out of it, right? Because I guarantee he's got some people telling him to do that, don't you? I'm afraid of that. Yeah, they're called stupid friends.

Starting point is 01:58:59 we all have right especially when you're 17 you have them there's lots of them around when you're 17 right yeah so I'm glad

Starting point is 01:59:08 that you have the influence with him that you hope you do and you think you do and I hope you can talk him out of the tree on this because yeah it sounds like you are it sounds like you've got a good foothold on persuading him

Starting point is 01:59:18 and I think you're being wise and I hope he will because here's the thing that 70,000 that remaining $60,000 if he leaves it alone and he comes on out as a Marine and he starts, you know, is very wise with his income there and careful. He could get a really, really good start in life.

Starting point is 01:59:37 That's what I'm hoping. And with that rest of that money, do you think he should, you know, put it in a high-yield savings? That would be fine. That would be fine. If you want to put it away even longer, you could sit down with a smart vester pro and park some of it in some mutual funds. But don't plan on touching it for five years if you do that. You can, but I wouldn't.

Starting point is 01:59:56 But if you could, that would be ideal. Just forget you have it. it. It would be ideal, right? Put it in a mutual fund and forget you have it and look up at 24 marrying your sweetheart and the 50 has turned into 150 and you can use it for a down payment on a house. Yeah, that's what my hopes are for him. That's what I would do with it if it was mine. Yeah, you know, I'm sitting here thinking, what would I do if I were you? I would show him that example. I would, I'm just, this is what I do to my kids. It drives him crazy, but I'm a question guy by trade, I would ask him, so what else involved with a brand new Marine who goes off and

Starting point is 02:00:35 he's got a car? Start asking a million questions. Now, just asking the questions, all irritating, which is great. Because what you want to do is, is it mild irritation to make him think through, is this thing more trouble? Because you and Dave are talking and you're like, oh, he's going to park it. But he's not thinking that. I would, and I'm playing when I say irritate. I don't mean really provoke the kid. I just mean make him consider, what is he going to with this car. And if he's parking it where you live, make him confront that. If he's got to take it with them and ship it or whatever, I would just make him walk through all of that and you might be able to deter this by not suggesting, but by asking. I would try it because I'm

Starting point is 02:01:15 with you. I would rather him save this money. It'd be okay to not buy a car. That's what I'm getting if you're going straight into boot camp. That'd be okay. Yeah. It wouldn't be the end of the world. But I was just trying to scratch his it. And if I scratch it with five grand and keep him for blowing 70, I'm on target, you know. What did you say? You tried it? I tried to tell him it's not necessary. We can still share. He's got a 15-year-old brother, and his point, that'll be 16, when he goes to Marines, and he said, well, then he can just use it when I'm gone. Because he thinks that it's a burden for me to have to drive them all around everywhere,

Starting point is 02:01:45 since it's just me. And he's like, then he can help you out. Well, here's a deal. I did a quick search while Dave was talking to you. There's some decent Honda Civics in that $5,000 to $7,000 range. So if you can help him stay in that range, then I think that scratches his itch, but also it keeps his money where it needs to be. Yeah. And then tell the dream of what happens to the other $60,000 that's going to turn into $160 for a good down payment when he's 24 or whatever the numbers end up being. But I mean, this is the mature thing to do with it, which is very hard to do when you're immature. When you're not old. It's hard to do when you're old, but it's not as hard when you're old.

Starting point is 02:02:25 but it's not as hard when you're old as it was when you're... All right. Christian. Kristen is next in San Jose. Hey, Kristen, what's up? Hi. I have a question about purchasing a house versus remodeling. We've been planning a remodel for the past year

Starting point is 02:02:42 and just found out from kind of a couple of contractors that now at this point, the remodel is going to be double what we want to pay, which means we'd be way over building for our neighborhood. The same time I'm finding this out from contractors, my dad has decided to move from Southern California up to be closer to us because my mom has passed in this past year and he just were kind of his last closest family in the area. And so we are now considering instead to sell his house, our house, and purchase a new house with an ADU. So that way he can kind of live on the property with us.

Starting point is 02:03:19 This would involve all me, my husband and my dad's means, all being on the mortgage and the mortgage. the title to the home. And I'm just looking for some advice to see if that is a good idea. We would be putting like over 50% down for the price of the home, and it would be within our like budget, even according to the Ramsey way of deciding for a budget for a house. And so I just want to know if that is a good idea or not. Well, there's a lot of downside to it because what you have to do is work through what happens in the event of all the negative possibilities. Okay. A negative relationship evolves.

Starting point is 02:03:58 That's the problem, okay? A death evolves. What happens to the half of the house then? What happens to the half if he becomes disabled, early onset? What happens if, you know, something bizarre happened and you all got a divorce? Okay, so, you know, all the, no one ever anticipates all the negative things and the exit stress. from this brilliant idea in the event of all the negative things. We always just look at, oh, this is going to work, and we can put our money together,

Starting point is 02:04:32 and we've got a better house. And, yeah. So if you work through all of those, probably on paper, as a part of a, quote, partnership agreement, unquote. You got siblings? No, I'm an only child. Okay. That makes it simpler, doesn't it? You're going to get his half when he dies, right?

Starting point is 02:04:50 Yes. And he has been very clear that he's like, the house is already yours, do what you want. want with it. He just wants to move closer to us in general, and he is elderly, so I do think that how old is he? We would be taking in his like mid-70s. Okay. And maybe not in the best of help like you are, but yeah. Okay. All right. Yeah, I mean, just be careful. It's just be thinking about what happens with, you know, and really have some good documentation on power of attorney and other stuff in case of like you know the one that comes to mind is i've got a friend deal with early on set right now and they've got a problem with the

Starting point is 02:05:31 ownership of the family business and the guy that holds the keys is not all there now so they've got a real issue and that's the kind of stuff you got to be real careful with and be thinking that through that puts us our the ramsay show in the books we'll be back with you before you know it in the meantime remember there's ultimately only one way to financial peace and that's to walk daily with the Prince of Peace, Christ Jesus.

The Ramsey Show - Wisdom With Money Means Moving Slowly

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