The Ramsey Show - You Can Still Escape the Debt Spiral Before It’s Too Late

Episode Date: April 9, 2025

📈 Are you on track with the Baby Steps? Get a Free Personalized Plan 📱 Watch the full episode for free in the Ramsey Network app. Ken Coleman & Dr. John Delony answer your questions and discuss: "My father-in-law left us a poorly maintained house that has taxes owed on it," "I have $40k of credit card debt," "How do I prioritize paying off student loans and other debts at a young age?" "Are prepaid service plans a good idea?," "Should I help my dad get a debt consolidation loan?," "My husband has no interest in learning about our finances..." "How do I get rid of my $1,200 car payment?" Support Our Sponsors: 🛒 Stop paying more and start shopping smarter at Aldi 🌱 Get 10% off your first month of BetterHelp 📱Go to Boost Mobile to switch today! 🏥 Learn more about Christian Healthcare Ministries 🏡 Get started today with Churchill Mortgage 🔒 Get 20% off when you join DeleteMe 🏦 Go to FAIRWINDS Credit Union for an exclusive account bundle! 🥗 Save 15% on your first Field of Greens order with code RAMSEY ⛨ Find top Health Insurance Plans at Health Trust Financial 💸 To find out more about student loan refinancing, check out Laurel Road 💻 Visit NetSuite today to learn more 🗂️ Use promo code RAMSEY for 18% off at The Nokbox 🎥 Get your tickets for The Chosen Season 5! 💵 Learn more about Timothy Plan 🏛 Get started with YRefy or call 844-2-RAMSEY 🔐 Visit Zander Insurance for your free instant quote today! Next Steps ✅ Help us make the show better by taking this short survey! 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 💵 Sign up for a free training with our EveryDollar team! 🤓 File your taxes with 100% accurate software that’s 20% of the price. 🎟️ See Dave Ramsey and Dr. John Delony LIVE in a city near you 🛒 Preorder Build a Business You Love Now at Ramsey Solutions Listen to more from Ramsey Network 💸 The Ramsey Show Highlights 🧠 The Dr. John Delony Show 🍸 Smart Money Happy Hour 💡 The Rachel Cruze Show 💰 George Kamel 🪑 Front Row Seat with Ken Coleman 📈 EntreLeadership Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

This is the Ramsey Show where America hangs out to have a conversation about life, specifically your money, your profession, and your relationships. 888-825-5225 is the phone number to jump in. We'd love to hear from you. 888-825-5225. Joining me today is Dr. John Deloney. I'm Ken Coleman. We're excited to be together to help you out. Let's get it going with Michaela in Raleigh, North Carolina. Michaela, how can we help today? Good afternoon. Thank you so much for allowing me to receive your wisdom today. Oh boy, well don't thank us too soon. That is youth. We haven't even dispensed of it yet. Yeah. But I like how optimistic you are. What's going on? So I have both a money and a relationship

question all in one. In January, my father-in-law sadly passed away and left behind my mother-in-law. They were married 52 years and he handled all of the finances. So on his dad's bed, my father-in-law asked my husband to take care of his mom and take care of the rental property, which is going to be basically her income going forward. All great. We didn't realize until a couple of months in that the property was left very poorly maintained. There were some back taxes on it. We had to, there's been no insurance on the property. HWA is very high.

So after we looked at all the numbers, we realized this is never going to be a truly income producing property where she can actually receive income from it. And the only reason it has been lately is because it was not maintained well. So it's been a point of contention because, um, it makes sense to sell it and get her something else that's more income producing for her, but she doesn't understand all of that. And she's very scared right now.

And my husband just wants to leave everything as is. Um, and she thinks that we're kind of stealing her money right now, which is not the case. We're just trying to back pay ourselves from all the expense we had to put into the rental property. So my question is because the death is still so recent, did we just leave everything alone for right now? Or should we pursue selling it and buying something that would actually be

income producing for her, for her to live off of? And if so, at what time does that make sense to do that? Well, do you guys have the actual authority to sell the house on her behalf? We do. It's been changed over to our names. How old is she? She's 74.

Okay, and how recent was the passing? It was in January, two months ago. Is anything on fire right now? No. I would wait. Okay. I would wait six months to a year if nothing's on fire. Okay. Because you're right.

Every decision that you make relationally is going to be seen through a pair of glasses that are just covered in hurt right now. Hurt and fear. Okay. And it's going to, I, it can hop, tell me if I'm wrong. It's going to be a, a series of, think of it this way. She has leaned on a pillar for her entire married life and that pillar is gone. And the person, she may love him, trust him,

think he's a good man, but she wiped your husband's booty. Right? That's in her mind. And so there's going to be a level of trust establishment made through a bunch of teeny tiny, consistent showing up over the next six months, over the next year. Very transparent, by the way, data is going to help, but it's not going to solve the fear problem right now. Right now it's just all, she lost a lung and a leg and two chambers of her heart. Right? And so she's going to have to slowly realize that she can

lean on him now. My question is, let's go back. You said you guys are trying to get back what you put into it. I'm paraphrasing what I heard. Explain what we're talking about. Did you guys are trying to get back what you put into it. I'm paraphrasing what I heard. Explain what we're talking about. Did you guys personally put money into this to try to fix this property up? Your money? We had to. When we got it, it was about to be put on auction because the taxes hadn't been paid

on it in two years and we didn't know that. No, I understand you had to. I'm not questioning that. I'm saying how much. I wanted to know if it was your money, so you answered that. How much did you put into it? So we've put in about 3,400 for taxes. We've put in another almost 3,400 for an insurance policy. We spent 800 on a home warranty. The HOA has been about 450 a month.

There was some extra HOA that we had to pay on that that was unpaid. We've had to fix two broken windows, change out the washing machine and the HVAC unit needed some work as well which amounted to about $1,500. So I got you guys approaching what? $10,000 or $15,000. I got you at around $12,000. Is that roughly, is that about right? It's definitely been over 10,000. So the other question then, what John asked is right, I think he's right and I agree with your partner on that, that the wait to sell the house, is that 15? Let's just say it's 15. Let's say 12 to 15 is what you guys personally put in. Do you need that right away? You guys okay not getting that right away? Well, we're okay.

That was my question is like, my husband wants everything to be run by books. So like pull the money from the rental income, but then nothing's going to my mother-in-law and she doesn't understand all the expenses associated with it. So that's where we're having a point of contention is like, how do we move forward with this

on the money aspect of things? No, no, I get it. That's why I'm bringing us to this point. And I think it comes back to John's advice. Would you also put that in the same bucket? Cause right now she does, they do need to explain it to her. Absolutely. And you need to explain it to her

as if she's a fourth grader. So there's some responsibility on you all. And by the way, this is not you, your husband. There's the relationship. You want to maintain the sweet daughter-in-law relationship. So hubs has got to step up, sit with mom, and I'll defer to John on the appropriate timeline, but it needs to be explained to her

as though she's a fourth grader, and say, mom, this is all about you. We put our money into this so that you have this. We have two options going forward. It's not gonna generate enough income, and you've gotta explain it to her and show it to her at the appropriate time. That's right now.

I think that's okay too, but I didn't know what you were gonna say on that. That's math, right? Yeah. And I would, like, as close to writing it down with a crayon as you can, and this is funny, I was on the phone with a 50-year-old earlier today who's entering into... Slow down. It's getting really old. This is getting personal here. I don't know where you're going with this. a 50 year old earlier today, who's entering into- Slow down, slow down.

It's getting really old. This is getting personal here. I don't know where you're going with this. But here's the thing, this 50 year old's heading into buy a house. It's not an age thing, but heading into buy a house and I gave that exact wisdom. I said, listen, don't feel ashamed to ask

the mortgage company to explain this to you as though you're a high school student. That's the exact language I used. And so a 74 year old, he may have said for the last 30 years, I got it, I'm taking care of it. Sitting down and saying, okay, mom, I need to just show you this. There were two windows that had to be fixed.

Here's the exact cost. This house was about to be taken, dad was sick, and he didn't realize the taxes. We're not gonna ever pin him as though he's a bad guy. Because immediately then she's got to defend him. We're not going to get into that. Hey, we had to pay these back taxes. They were $3,500 and here's the receipt for it.

And she might go, no, none of that's right. Mom, it's right. It's right. And if you think in that conversation she can get to, oh, well, then we just need to pull this out of this rental income. Great. If you don't, and you've got 15 grand, then it's not going to burn a hole through your family, pay the 15 grand and we'll figure this thing out in six months or a year when

the smoke lifts on this deal. Okay. Yeah, because what you're building towards, Michaela, if I heard you correct, is that you and your husband believe this thing needs to be sold, correct? It's the best move for her. That's what I heard. We do. We've had a lot of difficulties working with the HOA company, and that's never going to

go away. So I think if we could get a different property that's going to produce income for her long term, yeah. No, no, we get that. We get it. What we're saying is, explain the math now. Don't talk about selling the house six months to a year is what John is saying. But we're going to build to that.

We got to build trust with her in explaining. And I would even show her receipts on the windows. Just walk her through, go, mom, we did this. We'll settle it later. We just want to grieve with you. I like that approach. But then when the time is right, you got to cast vision the same way you did on this numbers thing.

Thanks for the call. So sorry for your loss. This is the Ramsey Show. Rachel, do you ever get these sketchy text messages that are like, hey, you need to update your address and verify so we can get you the package you didn't order? Yes, I have, George. Sketchy and never trust them.

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All right, let's go to Travis, who's joining us in Washington, DC. Travis, how can we help today? Hey, how are you doing, guys? Thanks for making my call. Sure, what's going on? I have a question. for making my call. Sure. What's going on?

I have a question. Education and career call. Basically, I was offered a job for about $150k total comp. I was also offered a full scholarship to a top 25 business school. So my question is, should I quit my job to go to business school? What would be the reason for going to business school? What's on the other side of that? So I want to do a transition from account management to product management. And all the roles that I've seen, all the roles that I'm looking for,

I'll require in that MBA. Okay. And you're currently in account management, making 150. Did I understand that correct? Total copy yes, say that again Total comp is 150. Oh your total comp. What does that include? So once 14 is the base and then the remainder would be your comp paid out over our shoes. Okay All right. So how are we paying for business school? With a full scholarship. Full scholarship. Are you going to be able to work and maintain your current job while you're going to business school or is this an all-in I'm absolutely quitting because I have to? Yeah, it's a full-time program so I would have to quit. How are you paying the

bills? Well, fortunately, it's me and my wife. So she will continue working. So we've talked about how the finances will look. It will be a lot less, of course, because I wouldn't have the income. But the main trade-off that we're considering is the salary after business. Sure. All right. Let's talk about the current situation first. Do you guys have any debt?

No, no consumer debt. And what's her income? You're going gonna go from combined income of what to what? Combined to 10, stable to about 98. Okay, you've crunched these numbers and you guys are not gonna be struggling just a little bit tighter. True or false? a little bit tighter, true or false? It will be struggling. We'll be tighter. We do have our funds already that we have security and we also have some money that we have available in investments that we're willing to move around if necessary throughout the semester. Okay, so a couple things here I'm hearing. We don't want you using the emergency fund just to pad the income.

Emergency fund is for emergencies only. And then I get nervous when I hear you talk about moving around investments. What does that mean? So, from what we did, we said we will be able to afford this change in income based on our expenses. Travis, let me recontextualize this. When you call the Ramsey Show and say you're struggling, people when they call us, they don't know how they're gonna pay rent or they don't have food. Gotcha.

So when you say you're struggling, does that mean you don't know how you're gonna pay your light bill and you may have to sell some stock to pay your light bill or are you saying we're not gonna be able to go out to eat for two years while you knock out business school? Well, no, I didn't say that I was said they won't struggle. He said it would be tight. Ah, okay. I thought you said he was gonna struggle too.

No. Okay. Okay. If I heard you right, Travis, you didn't say you guys will be struggling to make it paycheck to paycheck, correct? Correct. I don't foresee us going to struggle based on what we've calculated, but it will be tight because we're cutting our income in half. All right. Well, that's okay.

I mean, that again, I calculated a move like this. It doesn't scare me. I just don't want you touching retirement accounts. If these investments are non-retirement and it's supplemental, then that's the only scenario by which we would be okay with that. But really, we want you to cut, cut, cut and not be struggling where you go backwards financially. What do you think, what do you think,

and not, let me take, change the way I just asked that. Not what do you think and not what do you hope. When you have sat down with some people in your field or you've sat down with one of the executives at the company where you work, and it's a rare thing, because MBA programs, your field or you've sat down with one of the executives at the company where you work. And it's a rare thing because MBA programs, especially executive MBA programs, but two-year laser-focused MBA programs are cash cows for universities.

They used to be big time and it's leveled off. For you to get a full scholarship to a top 20 MBA program tells me you've got some kind of special, you've got something going for you that is unique because they just don't hand those out. I know some hot shot people making good money that went to MBA programs and they had to pay full freight. So something special has happened for you. So when you sit down and talk to somebody on the other end of this thing, what do you think you're going to make? What leverage is this going to give you besides just a job? Because I promise you in 10 years, we are going to be in a place, culturally and economically,

where you have to have checked this box to come work for us, nobody's going to care. But I do I do know and I trust you and I know this to be true there are jobs that still have that we won't even interview you unless you've checked this box so fair what are you gonna be making on the other end of this deal me from like a value-add outside of salary no no just what are you gonna make salary you make 125 now, 150 now. When you walk across the stage with an MBA from a top 20 program and you circle back to do to be a project manager at some of these firms that you're working at now, are they gonna pay you 300? They're gonna pay you 450?

What's the ceiling for you then? Oh, that wouldn't be out of the gate. So what I'm anticipating is when I first, when my when the first one in the program would be about the same style of making now can uh... but what i'm what i'm confident about is that my earning potential of the higher right now i don't have any of the order that national the role of the medicine sure that my max

uh... where does that come from the confidence for the That your long-term potential is higher because I've talked to a lot of students on the front end of grad school, man They're like no no when I get out I'm gonna make a hundred forty thousand and then I say just go look at the market They're like, oh man seventy five. So what makes you confident? Oh Well in the in the in there the first year out, um, doesn't just based off

just the school stats and what I've, what I've seen, what I've researched from the entry, not the entry jobs, but the jobs that they have, um, uh, recruiting for, uh, they're looking at around 150 is the average, so it could be less. It could be more when I first get out. So there's a chance that I would have less of a salary when I first get out of business school. Um, but I'm looking at that three to five years afterwards and being able to earn the income potential to get a more senior role, which I'll

be more qualified for, and also being able to transition industries a little bit. Sure. So how long is the program? Two years. Okay. Yeah, you know, look, I challenge the process naturally when I hear someone say, I have to have an MBA, but I think John addressed it correctly. There are in fact, I believe you that you've done research and that some of the jobs that you want to be able to get into are requiring or certainly recommending that. So I'm not going to dispute it, but I really, John just touched on something that I want to jump on.

I'd like to see you get less out, less information online and put in your head that this is going to pay off. And I want you talking to people that are where you want to be five years from now. I'd really prefer that. That's a, I wrote an entire book on that, the proximity principle. And I think having lunch or coffee with some men or women that are where you wanna be down the line and getting their opinion, to me, far more important

than what any business school puts on their website. Because here's what the, that's a marketing tool that a school's gonna put on their website. Here's a couple of things they can factor in, not always, but sometimes. One, they may give you the average salary of those people who got jobs. And they don't address the folks who didn't get jobs. The other thing they may do is say,

here's the average salary. What that doesn't paint is I could right now put on a piece of paper, the average graduates from my PhD program make X but because I work not as a day-to-day therapist but because I'm working where I work now and I've got two best-selling books under my belt I would drag that average way out of whack and so it would say man the average graduate makes this much money holy smokes and you go do that and that would

not be representative of what most people make. That's number one. Here's number two. I heard a little inkling of this. If you're bored at your job, or you're just done at where you work, before you take two years off, and by the way, I'm, I'm as pro higher ed as anybody in this building, right? I'm as pro go get a free MBA. If you can get that, that's a great credential. But if you're just bored at your job, you're done with it, if you're already pulling $125, $150, I think you've got the skills to go be a project manager somewhere right now. And so that's worth at least having one or two conversations with real people out in the field, my brother. But yeah, all things considered, if y'all can float it for two years, go get that free credential from a top

20 school. This is the key. You guys got to be all in on the sacrifice. And you said it was a sacrifice. Be all in on it. No concerts, no restaurants. You can do this. This show is sponsored by BetterHelp. All right, you've heard me say it a thousand times and I'm going to keep saying it. You've heard me say it a thousand times and I'm going to keep saying it. You're worth being well. And listen, therapy can help. I see a therapist, and let's be honest, a lot of you should too. But let's be real, taking that first step to see a therapist can feel overwhelming. Maybe it's the time, maybe you have some preconceived notions about therapy, maybe it's the cost.

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Find a store near you today at Aldi.us. That's A-L-D-I dot U-S. Well, Dave Ramsey and Dr. John Delaney, my co-host today, are going to be heading out on the road. Several cities. We got Louisville on April 21, Durham, April 23, Atlanta, April 25, Phoenix, May 5, Fort Worth, May 7, Kansas City on May 9th.

It's the Money and Relationships Tour. Dave and John are gonna be out there taking your questions. Little bit different format, John. Give us a little bit of a preview of this event. The best way I would suggest it, it's gonna be stuff people haven't heard before. The principles will be the same, but the stories will be different,

the interactions will be different. If you ever wonder, man, what do these guys talk about when the microphones are off and what our fearless leader James edits out of the show, that will be live. It will, like I said, I've said a few times with Dave, I don't usually get nervous on these big events. I just think they're fun. I'm kind of puckered up about this one,

this one's gonna be fun. And we're gonna throw it out to the audience. So we'll have the big screens in these beautiful theaters across the country, and we'll have a number of topics that the audience can vote on in real time and say, we wanna get your take on this. We wanna get your take on what's happening here.

And in a very polished world where AI is just synthesizing everything and making everything click, Beatty, this will be a way to interact with Dave, with me, in a way that most people don't ever get the opportunity to do that. And it will all be live, and I like having fun at Dave's expense sometimes on stage.

And so we're gonna have a blast. Boy, that might be interesting. Yes. He likes control. He does, so when- He signs my paychecks, it's gonna be fun. And you are out of control, so this is gonna be a great combination here.

I'm looking forward to it. By the way, no matter how many times the audience asks, please don't tell them what hair product I use. I'd like to keep that secret. That's a secret. I appreciate that. George, on the other hand, has his hair product tattooed on his chest, so I'll share that one.

It's true, it's absolutely true. And Dave doesn't need hair products. George is like my grandmother, you get his hair done once every three months and it just stays that way. That's exactly right. He has that little helmet that comes over. Yeah. Yeah.

And Dave, his hair product is largely an armor all product. And so we won't talk about that. Oh man. Hey, if you want to get your ticket, go to ramsysolutions.com slash tour. That's ramsysolutions.com slash tour. If you're tuning in via YouTube or podcasts, the link to get the tickets to the Money and Relationship Tour

with Dr. John and Dave are in the show notes, which by the way, so many other great things are in the show notes. Everything we mentioned here on the show are in the show notes. James, our producer, likes to call them a treasure trove, the show notes. All right, 888-825-5225. Alexis is joining us now in Salt Lake City. Alexis, how can we help?

Hi, thank you so much for taking my call. First of all, I'm in not a bit of a pickle, a big pickle. In 2022, I had to go on short term disability for some kidney illnesses and so on. I was on that for three to six months and had to end up quitting. And in that timeframe, um, my grandfather ended up getting, um, a blood cancer. I ended up moving. I know. So I ended up moving from California to Utah to help take care of him. Um, he did, he did beat it. He's in remission. So that's great. And yeah, and then he actually got colon beat it. He's in remission. So that's great. And

yeah, and then he actually got colon cancer, but he's in remission from that now too. But I know in that timeframe, my grandmother ended up getting sick and I had to become her full time caretaker and she went to the hospital and unfortunately passed away. Oh my, you have been through it haven't you? Sorry, I got a little bit. No, you're okay. You're okay. Hey, listen, that's tough stuff. There's a lot all in a row. That's right. Can I ask you a question? Can I circle out a little bit? Yes, for sure. Who told you that you were the one person who had to take all of this on by yourself? I didn't take it on all by myself.

My grandparents are basically my parents. My parents are not helpful. They have their own problems with drugs and alcohol, so that's not been a helpful situation. My aunt and all who I lived with and have had a great relationship has stepped in and that's my uncle, that's his father, who was my grandfather. So they've helped out financially and so on. But I was the main person who moved here and was with them 24 seven and things like that. So how have you eaten and paid your bills since then? Credit cards. Okay. How much have you racked up? I've racked up about $42,000. $42,000?

Yeah, $43,000. Do you have any other debt? No, it's just in credit cards. Okay. And are you working right now? No, I'm not. What about your kidney disease? What's the status of your health and your ability to work? Because if I understood you correctly, you stopped working because of the kidney issues, correct? Yes. So I'm in the midst of getting diagnosed with lupus, so they're trying to figure

out that. And I also have rheumatoid arthritis. And there's a couple other autoimmune disease that I'm trying to figure out. Are you able to work? Not at this current time, no. I'm in the midst of going to doctor's appointments myself. So we've already got $43,000 in debt. Doesn't sound like we have any kind of diagnosis or treatment plan in place right now. What do you anticipate? The timeline being that you get some type of diagnosis plus treatment and any sense of when you might be able to go to work and how are you going to stay alive financially? What do you know? So I'm hoping in the next six months I can get treatment for the diagnosis. I have been diagnosed with rheumatoid arthritis. I have tested positive for lupus but it's a symptom

based disease so we're trying to limit you know what is and what's not. Any sense from your doctors as to when you would be able to work? No, not really. The waiting time to get into specialists is pretty hard. I've been on waiting us to get into neurologists and different rheumatologists, different GP's. So what's the plan as of right now to be able to fund your life? As of right now, what I'm looking at

is trying different things. I'm trying to see if I can do some part-time marketing. I'm also looking to see if I can do some part-time dog watching I'm also looking to see if I can do some part-time dog watching or dog sitting just to bring in some type of money. I'm hoping in the next six months I can get a diagnosis and get some semblance of my life back. Well the diagnosis it's not going to be a it's not it's going to be a confirmation but it won't be a magic wand. No, I know that, but I think part of, I think an answer would help. Absolutely, like not knowing,

not being able to trust your own body is a terrifying proposition, no question. And so is it okay if Ken and I love you in a way that we tell you the truth that probably nobody has? Is that okay? Okay. When it was about caring for you, somewhere along the way you got the story that you're not worth caring about, but when it came to caring

for other people, you packed up and moved across the country and you made it happen. Because that's who you are. You're way, way stronger and way tougher than you, than your body allows you to believe you are and the stories you've been told by people all around you your whole life. So here's me and Ken telling you, or I won't speak for you Ken, here's me telling you I love you. The greatest gift you could give as a caretaker for somebody else is to make sure you're okay. And right now, your body is revolting for a number of

different reasons, but I'm going to suggest that one of the main reasons is it knows you're not safe because it doesn't have groceries. It doesn't have a roof. It doesn't have a friend that you can go laugh with or weep with. And so this is going to sound counterintuitive but not kind of hoping. I would really love you to see for nobody else but just Alexis, you to find two part-time jobs that you can do even if it's uncomfortable, even it's a little bit painful and begin to show your body, I can. And that goes counter to everything. And I don't want to minimize your pain.

I know you're in a ton of pain. And like you said, that not knowing there's no name to this dragon that keeps burning down how you feel every day. Like, man, that is haunting. I get that. And it may be that when you get these diagnostics, you can go file for SSI and go through that whole complex place.

But I don't see a path forward, but without, without, you gotta, you gotta make some money. I agree with you, John, wholeheartedly. Alexis, real quick here. What we've got to do is, is you've got to come up with a baseline of what I need to make to be able to just survive, take care of myself. And then I know the 43,000 or 44 seems insurmountable. It's actually not. It's not. Don't file for bankruptcy. Please don't.

Don't sign up for one of these dumb credit things. Just get yourself above water by working the two jobs or whatever. I couldn't agree more with you, John. And that means care about you as much as you care about these other people in your life. You've got what it takes, Alexis. But you gotta fight right now

or this is gonna get way worse. So fight. You know, one of the first things I discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies and there's too little life insurance or none at all. Grieving families are suddenly

left behind scrambling to pay bills and trying to make ends meet. I also discovered that there are a lot of rip-offs in the life insurance world like that whole life crap posing as an investment opportunity. What you need is level term life insurance, usually 10 to 12 times your income, which is the smartest, most affordable way to protect your family. The key is finding an independent broker who represents a ton of companies and works for you, not for the insurance company. This is exactly what my friend Jeff Zander and his team at Zander Insurance are all about.

They shop the term life companies to find you the best options and they've been around for over 95 years. So you know they'll be there when you need them. Zander is the real deal and that's why they've handled all my personal insurance for over 25 years. I trust them and you can too. Visit zander.com for instant online quotes or for a more personal touch give them a call at 800-356-4282. Alright folks, are you staying on track with the baby steps? If you'd like, you should take a quiz to check your progress and receive a personalized plan just for you. All you've got to do is head to the show notes, click on the link titled, Are You On Track with Baby Steps? Complete the quiz.

This is a great tool just to see where you stand. It shows you the mile markers, if you will. It's really encouraging, not discouraging, but it'll create a customized plan, as I said, to give you that momentum that you need to make it through. So do check that out. Okay. Can I... You and I were talking off air. If you are watching the news right now and it feels like the world economy is melting

down and people are playing roulette with your retirement funds and your this and your that, you literally, you can send a note to your congressman, you can call, you can write an email, but you, you can't participate in what's happening at that level. What you can do is look in the freaking mirror and say, as for me and my house, how are we doing? And if you don't know where you and your house are, this little tool, staying on track with a baby steps and receiving a plan, that's a thing you can channel all of this excess energy, anger, rage, celebration, whatever you're feeling right now, walking around your house, walking around the neighborhood, and this is the pot talking to the kettle here, man. Walking around just being exasperated literally helps nobody,

helps nothing, and it just assures you that you're going to have a stroke or an aneurysm. By clicking on something as simple as, all right, as for me and my house, how's our money right now? What's the honest truth? Where are we? And channeling into things you can actually do something about, you can actually control and getting off the social media train. This is actually a thing, a Xanax for a family. You know what? It's not a Xanax.

It's not a way to numb out. It's a recipe for what do you do next when it feels like everything's on fire around you, right? Go check this out. It is a recipe for what do you do next when it feels like everything's on fire around you, right? Go check this out. Go in the show notes, click on the link. Are you on track with Baby Steps? And give yourself something to do with all this excess going on in our houses right now. Well, speaking of what's going on right now, let's just go back to last week when we saw the volatility in the stock market or any time over the last few decades that you've listened or watched this show.

We have a lot of new people, John, that are coming in all the time. So for the newbies, had you talked to us or called us last week and said, what do I do with my 401k? I'm watching it plummet because of the stock market. We would have said what, John? Nothing.

We would have said, sit, you can only get hurt if you try to get off the roller coaster in the middle of the ride. Ride the roller coaster, enjoy it, you're going to end up. And then we came back Monday and it went down even further. And then it came out Tuesday. It's all coming down. It's even further. And then as I look at it right this moment, as I look at his rugged handsome face, it's up 2,400 points. The biggest rally in five years. So we had the, what was it, the biggest, the biggest rally in five years. So we had the, what was it, the biggest fall off. One of the top five all time, and now here we go.

So just the point here is trust us. We have a method to our madness, and this is why you hold long-term, oh, by the way, and if you don't agree with us, there's this guy named Warren Buffett who says the same thing. So point made here don't ever let the headlines dictate your financial decisions. But I

do want to acknowledge I'm feeling it. I'm feeling the chaos and it was it was our mutual friend our manager that we share out here like it was like man I know a guy and he said you should just control what you can control. And I looked at him and was like, well played, dude, right? He just read my own book back to me. Like, you're right, I can't do anything about that. I can make sure me and my family are on track. And that's what I can control right now.

So here we go. Here we go on the roller coaster. Today it's up, whee! You know? And tomorrow, ah! Yeah, who knows? Who knows? All right, let's go to Daniel,

who's waiting on us in New York. Daniel, how can we help? Hey, thank you so much for taking my call. Sure, what's going on? I have a lot of different areas of debt. And honestly, I'm a young guy. I'm 23 years old. I'm graduating with a master's.

I'm over $100,000 in student debt. I have a car that has $13,000 in debt. And I have about $8,000 in credit card debt. And I'm just trying to figure out the fastest way to get out of debt. I'm on baby step two and I think I could pull it off in less than five years, but I just wanted to hear your advice.

Yeah, well, first of all, glad that you acknowledged the Baby Steps and that you're on Baby Step 2, and that's the answer to the question. The fastest way to get out of debt, based on millions and millions and millions and millions and millions of dollars, by a lot of people using the Ramsey Plan, that's the best way to do it. So you're already in baby step two,

what have you accomplished so far? What have you paid off so far? Or are you just now beginning baby step two with the first target being the $8,000? I'm gonna start making about 75,000 come May. That's pre-tax. So I figured that'd be like 60,000 after taxes and I'd have no rent and very minimal cost of living.

Okay, so my point is, you have not, my question was, have you started already or is this brand new as soon as you start getting paid? Brand new. Okay, so we're going to start with the 8,000. That's the smallest debt that you have, correct? Yes. Okay, so your minimum payment on those credit cards, we're gonna go minimum

payments on everything else, but we're gonna go above and beyond the minimum payment on the 8k. So the car and the 100,000 student loan were just minimum payments on those, okay? But you're gonna put every extra nickel that you have towards the 8k. What do you anticipate the payoff of the 8,000? How long will it take you to pay off the credit cards? I think in two months, two or three months. That's huge. What's your combined payments on those credit cards?

Minimum. Probably like $200. Okay, great. So we take this, so once you walk, so you're walking through this debt snowball. So once you pay off the 8K, you're gonna take that $200 and you're adding that to everything extra that you've been pouring in.

And so now we're going after the car. And so that's how you do it. Every extra cent you've got above and beyond that car payment plus the $200 that you've been making in minimum payments and you're gonna knock that car out. And then that's the big boys, the only one left and that's going to take some time. Let me ask you a question about that 100k. Is that, did you consolidate it all into one

big lump or is that 10 different loans, one at $900 and one at $62,000? Right now there are five different loans. Okay, so here's what we're going to do. We're going to take all of those loans and we're going to look at them individually. And whatever is the smallest, you're going to pay that one off first. Would you recommend consolidating them? Please, God, don't do that. No, no, no.

What are your amounts? Right now, there's one that's like, there's two that are $20,000, one that's $50,000, and another one that's $30,000, and then there's a really small one. What's the really small one? It's probably like $2,000 and another one that's 30,000 and then there's a really small one. What's the really small one? It's probably like $2,000. Okay so we're gonna reverse what I we're gonna re- We're gonna put that one at the bottom. We're gonna amend what I said. The very first debt you're gonna pay off is the $2,000 small student loan. Then we move to the 8k and I guess I should ask the same question there. I'm glad you did that John. Is the 8k and I guess I should ask the same question there I'm glad you did that John is the 8k the total of credit cards or is it just one credit card for 8,000? One credit card. Okay great so that's the that's the line $2,000 student loan the 8,000 on the credit cards then the 13 on the car and then we've got 20, a 20, a

30 and a 50. Hey how are you, Daniel? 23. 23? What are you going to be doing making $75,000? Building skyscrapers. Building what? Skyscrapers. Oh, geez. See, I misunderstood that question.

I was like, he's not going to be doing anything. No living. All right, here's my challenge to you. Do you have kids? No. Are you married? No. Find two other jobs to do in addition to building skyscrapers. And two or three other guys to live with to minimize any kind of living expenses. If you're living at home, just sit down with your mom and dad and make a plan. I'm going to get out

of here at 25 and I'm going to have knocked out x, y, and z of all this stuff, but sit down with a plan. Otherwise, you're still going to be treated like you're a middle schooler. But here's the deal, you're in your early 20s, you have no responsibilities, I don't want you to have a life, no comedy shows, no going out to eat, no coffee that you're buying, you're using, you're drinking that free swill on site, you are every nickel and after two years I don't want you just to have paid off this one loan in the 8,000 bucks. I want you to be through the car too. Just go berserker mode, dude.

You've got nothing holding you back. Last thing, if you get online and you look at Instagram, they're going to tell you to take the highest interest rate. That's a recipe for disaster. You're going to get $2,000 into this 50 grand and you're just gonna quit just follow the plan follow the plan and work like you've never worked before my man. You've got this Daniel that you started off the call how do I do it? Well you're already planning to do it so now just walk those steps

out you'll get there faster than you possibly imagined because of one fabulous word momentum. Good hour Dr. John Delaney I'm Ken Coleman this is the Ramsey Show. Let's be honest shopping for health insurance can be confusing with high costs complicated terms and customer service that doesn't really serve you most folks just pick a plan and hope for the best. See, insurance companies don't work for you. They work for themselves, meaning they love it when you overpay. So you need a guide on your team to help you make the best choices.

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health trust financial dot com this is the ramsay show where america hangs out talk about the money their profession and their relationships long side dot john lennon and colman were so excited you join this trip late eight to five five to two five is the phone number triple eight eight to five five to two five kick it off with Tim in Orlando Tim how can we help today?

Good afternoon. Thank you for taking my call. Sure. I just had a question. I wanted some help in determining how do you figure out if you're a candidate for long-term health care? Hmm. Let me flip that on you.

What are you thinking when you're thinking about calling us on long-term health care? What's your position? What are you thinking? What are the circumstances? Well, my wife and I just retired this past June, and we're not sure at what point are you comfortable with or would we be comfortable with being self-sufficient as far as self-insuring? That's the answer. And then, oh, sorry, I had to hear you. Yeah, that's it. That's the factor. So I was curious, I didn't know if you were going to give me some kind of health situation or some health history, but the bottom line is that if

you can self-insure because of your investment portfolio, your retirement position, then you wouldn't need it. It would be a general answer. So what's your situation? Explain it to us. Well, as far as health, we're both very healthy. I am 60, my wife is 57, and we live a pretty active life. And as far as financing and stuff, we probably have about $1.7 million in stocks and bonds and stuff like that. Not including our house,

which is probably valued at about $300,000. And we probably have about $3,000 in cash just in the local bank. We are debt free. We don't own anything on anything. Yeah. John, I in that situation, I mean, I don't think you have a huge, I mean, your net worth is going to continue to grow. You said you're 60? Yes. And you have how much in retirement accounts?

About 1.7 million. Excuse me. I don't know what happened. I just all of a sudden like got choked. So the federal government, again, that may just disqualify what I'm about to say, but their estimation is about three and a quarter that the average American needs about 325,000 bucks after retirement. Okay. And so, and I say not after retirement, but to handle a crisis. Most people, about 80% of people won't live in a long-term care facility beyond five years and about 20% will. Okay.

And so, I'll tell you, my dad was a policeman, my mom was a teacher and then a professor and they're not wealthy. About 10 years ago, they're in their mid 70s now. About 10 years ago, for Christmas, they bought the kids, they got long-term care insurance for themselves. And that was one of the greatest gifts they've ever given us. But they didn't have $1.7 million sitting in a retirement account and at the time they didn't have a paid for $300,000 house. And so if push comes to shove, I love the idea that y'all are healthy, you go get checked up with doctors, all that presents that well.

For Ken and I, our whole life is, our whole job depends on everything was going just great, and then the wheels fell off, right? And so I want wanna always hold that, that y'all doing everything right and life happens, it happens to all of us, and you guys are in a pretty good position and assuming that we can get through the next few weeks, months, years, decades

with the last 80 to 100 years being similar to the next 10 to 20 years, you can expect ish that 1.7 becomes 3.4 by the time you're 67. And then that 3.4 becomes 6.8 by the time you're 75 ish, 74 ish. I agree, Tim. I think you can self-insure, but you know run the numbers on it. Yeah. And it comes down to your tolerance. For risk. For risk, but based on the numbers you've given us and the amount of time you spend and all that, I think you guys would be fine. I don't think it's a must for you, but I also would say in your financial position, you can afford it too. Right,

and that's like for me, the thing I might, um, I, I'm just trying to project myself. If I got $1.7 million in retirement accounts and a paid for house and I'm 60, I would probably let health insurance expire at 65 or 67, like whatever age you have that set to expire. But if you have an extra, I off top of my head, I'm making up a number and you may roll your eyes. I don't know how much monthly long-term care insurance costs, whether it's $300 or $800, but if that's a payment you can stomach for the next decade and it's just gonna let you have

a little more peace in retirement, man, I'd throw that out the window. You might spend that on fishing gear and coffee in retirement, right? That's right. Okay, yeah, and as far as like our health insurance, I'm a retired teacher, so our health insurance, we pay about $350 maybe a month to cover my wife and I for the rest of our life. So. Amazing. That's phenomenal.

Hold on, can we double click on that? You're a teacher? What did your wife do? She was in property management. And so yeah, I taught elementary and she was in property management. What's the most you guys ever made combined income? So yeah, I taught elementary and she was in property management. So. Listen, most of you guys ever made combined income?

Probably around, oh, maybe about 170. Yeah. Very good for you guys. Congratulations, guys. Yeah. What's your... Yeah. And I mean, we just got to the point where, you know, we doubled down on our house payment.

When we bought our last house, we did a very short mortgage and we just doubled up on everything. That's awesome, man. Congrats. So when you called us, started this call, which way were you leaning? Were you gonna buy it or were you leaning against not getting it? Well, we weren't really sure.

We had just started to check into it probably the last two weeks. We talked to like one of our financial advisors. She gave us some options to go. And I guess one of the questions that I wanted to ask you guys is some of the people that we had talked to had recommended like a life insurance policy with the rider.

And then some of them were like strictly life insurance. And when we got thinking about it, some of the policies basically like if you didn't use them for long-term healthcare, you had no money at the end of the policy. You basically paid into it, but you have nothing. Yeah, you're talking about whole life. You're talking about whole life. Yes.

Yeah, we're very anti that. So run from that as fast as you can. Okay. And that's what I wanted to ask you because one of the policies worked like you could either pay a chunk of $50,000 right up front. No, no, no, no, no, don't do that, don't do that. No, you already know the answer to that. You shot it in the foot as soon as you were telling us.

You were like, oh, I get nothing out of it at the end. Yeah, don't do that. So my last question for me is, did you run some numbers on the cost, because I think John brought it up, and I think it's a fun exercise. What would it cost you to get the long-term healthcare, emergency care service, I mean insurance, excuse me?

We have not run the numbers. I mean, we just, like I said, we just started to look into it, and we've had a couple of people quote us different numbers. One of them was about five grand a year. And then again, one of them said, you could pay a lump sum of 50 grand

and never pay again in the rest of your life. But then they tried to tell us the advantage to that was- No, Tim, we keep going back. Tim, Tim, stop talking about that. We already told you. I'm talking about long-term care insurance. Look into it, see what the cost is. You and your wife sit down and talk about it

like John said. This is not a retirement vehicle. Yeah, not at all. This is you hedging risk. You don't want a check back if you don't use this at the end. This is you putting this on the table just in case this happens.

Go to ramsysolutions.com and go to Ramsey Trusted page and you can talk to our friends at Xander about long-term care insurance and they're gonna tell you the truth and they're going to be honest with you. It's who I trust with my family. You can trust them too. As an investor and a person of faith, when your mutual funds and ETFs put your money into the dark side, you might feel a disturbance. Well, good news. Timothy Plan offers investments for people who want to be intentional about where their money goes. As the pioneering force in biblically responsible

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but just know that taxes don't have to be stressful. Ramsey SmartTax is a 100% accurate software that makes filing simple and easy and doesn't make your wallet cry. So don't be the person pulling your hair out because you're trying to file at 10 o'clock at night on April 15th. Get this party started and over with

by going to ramsysolutions.com slash smart tax. That's ramsysolutions.com slash smart tax. That's ramsysolutions.com slash smart tax. Hey, please, please, please take two seconds and hit the subscribe button, hit that little heart button or the thumbs up button, whatever you got to do to tell the algorithms that you're in on this show. It makes a huge difference. And if you're watching your friends and your family and your neighbors losing their mind over what to do economically, and you're keep thinking, I've got a, I've got a plan.

Just simply going to leave a five star review, hitting the subscribe button. It kicks the show up in the algorithm for the technocratic overlords. And it tells the computers that more people want to consume the show. And it puts out in front of more people. It's a way to help your community. It costs nothing to do this. So take a second, subscribe, leave reviews, share an episode with a buddy. It makes such a difference for everybody. Thank you so much. All right. Let's go to Rebecca in Chattanooga. Rebecca, how can we help today?

Hi. Thank you so much for taking my call today. So I am in baby steps seven. And thanks to your program, I'm a baby steps millionaire. Nice. And I'm about to thank you. What's your net worth? Well, depending on the market of about two million. Good for you. Depending on the market. It was 1.1 yesterday, 2.1 today. I haven't looked in about six weeks. Oh, well let's back up big time today. Continue that trend. Yeah, it has a lot of ground to gain. That's right. My buddy who's my Smart Vestor Pro texted me and he said, hey, just don't look.

And that's good for me. No, I'm not looking. I've got eight to 13 more years of work. Outstanding. Good for you. So the reason I'm calling today is that I'm about to purchase a new vehicle. Congrats. I'm allowed to do as an elevator. Yes you are. And I'm gonna write a check for it and of course now they're offering me a prepaid service package and I know how we feel

about extended warranty and I definitely would not get one of those but then when they talked about this prepaid service package, I thought, of course my antenna goes up and I immediately think this is how they're going to try to make their money off of me. But I just wanted to get your take on that. Your gut is right. Pass. They're not going to hard pass. I'd say, no thanks guys.

And just talk to them about how much money you have in the bank and that you'll take care of your issues with the car when it arises here's what they'll say very much they will make you feel so dumb like you're the dumbest person who ever lived you're a you're a multimillionaire and they're gonna make you feel like you're a dumber than a box of hair and they're gonna tell you but you've got to get the oil changed anyway and you can just do it now and you can do it for nine dollars and, that's why I told her to flex. With your last caller and the prepaid life insurance, I thought, hmm, that's probably a lot like a prepaid service plan.

That's exactly right. Here's the deal. I love these kinds of things, and I think you take a really strong stance, because John's right, they're going to try to talk you into it, but if you lead out with the flex, you know what? I've worked really hard to be a multi-millionaire and I'm good. So I don't need the service plan. I just take care of things as they come because I've got cash. But I do appreciate that your leaders want you to give me this option. Just call it all out.

Put it on the table. And that's my little pitch there is how I would do that. And by the way, that they immediately go, oh, Rebecca is not to be played with. Here's a similar one. I bought a new car, I think two years ago, and the person said, hey, here's, he handed me a piece of paper and it said, hey, here's the estimated repair costs

over the next X number of years, you wanna buy one of these prepaid warranties. And I looked up and I said, oh man, my bad. If you're already telling me that this car that you're selling me new is gonna be broken in two years, I'm gonna go ahead and walk. And it was like, no, no, no, no, hold on.

If you're telling me right now that the engine's gonna fail and that you think this is gonna happen, I need to know that now. Cause I thought I'm buying a new car from a reputable place and dude, it ended immediately. Well played, sir. Immediately, it sir. Immediately. I like that. Yeah. If you were. There you go Rebecca you got you got some options there but the answer is hard pass. And for everyone listening here's the honest truth for Rebecca. She's got eight years left, she's a multi-millionaire, she clearly knows what she's

doing and if you, let's just be honest about the math, if you, every three months, went to the local dealership and you prepaid, you gave them 2,000 bucks and you got lifetime free oil changes, and they amortize that out over eight years. Like if you come here, it's gonna pay for itself 10 times. A, the chance that you still have that car in eight years, that somebody in your life hasn't had something

that you've got to hop up and move, that you, like there's so many factors over the next eight years that it's just not worth playing the gamble, especially when you've got two million bucks to say, man, I'll, I'm going to get my old chains where I want, when I want, and I'm going to move on. Thank you. Love it. Let's go to Kristen, who is joining us in Phoenix. Kristen, how can we help?

Hi, thank you so much for taking my call. So my current situation is I recently interned at 30. I lost my job four months ago. And right now I'm living with friends on EBT and have state insurance. Okay. And I'm also in $42,000 a day. And so I've been actively on the hunt for a job,

but I just haven't had any luck. And so obviously it's just been like a really dark and heavy place to be because at 30 I literally lost everything and I have nothing going for me. Not true, not true, not true. I'll call that one out. The other ones are true but I'll call that one out. Okay, thank you. Well, in the meantime, I've kind of revisited this dream that I've had in my heart for seven years which is to start a nonprofit. And so I was like, well, the market is so bad,

let me just maybe go after my dreams. And so as I've been looking for work, I've also been taking steps towards a nonprofit. And I've just been getting green light after green light and after green light which doesn't make sense because I always thought when I started this nonprofit, I would be stable and 100% out of debt. Well, this is kind of where I'm at right now, my dilemma which is why I'm calling you, is I have a chance to receive $5,000 from someone who believes in me. And I could take that $5,000 and it could cover my basic needs for about three months. And so do I use that $5,000 to go into creation

mode and pursue this dream or do I stay in like survival mode and wait until like I'm at a debt? And yeah, How much is the debt? How much is the debt? 42,000. Yeah. A couple things. I understand that you're down. We have limited time here. So I'm going to do less emotional loving on you and I'm gonna do some financial loving on you if that's okay. All right, so number one, I understand that you have not had the luck that you feel like

you would have liked to have had getting a job, but there are plenty of jobs, plural, that you can go get and it starts today when you hang up. I don't care if you're walking dogs, you are delivering pizzas, you are stocking shelves at a big box store. This is at this point right now, this is not about passion or dreams, the career or the passion, the dreams. This is fighting to survive and I don't know how you've been surviving and so today we start fighting. So it's two, three jobs and we start getting some momentum while we're looking for some stability and we keep working the fact I'm gonna give you a copy of my book The Proximity Principle

and I want you to read it. We'll give you whatever format you want but you have got to start making progress so we work any job that we can take, three jobs, and we begin to work the debt snowball. We're also going to get you, let's see, let's do a total money makeover. We'll give you that too as well. You need to read this. Financial Peace University.

Financial Peace University, we're going to load you up. Christian, just give her everything she needs, all right? Is you need momentum. Now here's the deal. I would not take the $5,000 because that $5,000, you just say, hold that, there's a day. There's a day in the future where I'm gonna be able to take this gift and put it towards the actual launch

of the organization. This is not $5,000 to keep you afloat for three months. That is horrible, horrible idea. And that's the Kristen, by the way, that John checked at the start of the phone call. I want to give it to John really quick here to kind of give you kind of a pep talk, but right now that's what you need to do. Now John will tell you about what you need to feel. What you need to do is don't even think about this nonprofit right now.

Exactly. Listen, you've backed yourself into a corner. The way you phrased it is, do I just keep surviving or do I go follow my passion and dreams? That's a false dichotomy. We're not just gonna hunker down and look at the floor and walk around. And it's not that or sunshine and rainbows. Nonprofits are really, really tough.

So here's what we're gonna do. Like what Ken said, we're gonna go get a bunch of tiny wins and we're gonna make $13 an hour, $11 an hour and we're gonna keep showing up and then four months later, you're gonna stand six inches taller. You've got this, Kristen. You got this.

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and your relationships. And it starts with just one night. Join me and Dr. John Delaney, live in a city near you, on the Money and Relationships Tour. We're covering the real life stuff that matters, so you can break the cycles that have left you stuck. It's coming up fast, so get your tickets for Louisville, Durham, Atlanta, Phoenix, Fort Worth, or Kansas City at ramsysolutions.com slash tour today. Let's go to Jack in Sacramento, California. Jack, how can we help you? Hey guys, thanks for taking my call. I really appreciate it. So I was wondering if I should get a consolidation loan for my father. He has about 50,000 in debt. It's probably about 35,000 in credit cards, about 10,000 in a personal loan,

and probably 5,000 on a car. He's making the minimum payments on all of his stuff and he's just barely making it buy. So Jack, number one, if your dad called us and asked us if he should do a consolidation loan, we would say no. So we would definitely tell you not to get involved in any kind of consolidation loan or helping your own father out on his loans. This is a no, no, no, no, no with exclamation points.

And I want to say, man, you're a good son. What's happened to bring you to this point? Well, I'm kind of almost worrying about myself because he's getting, he's getting older, he's about to turn 65 and I'm worried that when he gets to the point where he can't work anymore, he's going to just barely be able to cover his own payments and I'm going to have to start paying for his where he lives and all that type of stuff. I get that worry.

That's a legitimate concern, a legitimate you looking into the crystal ball if things are going to continue as they have been in the past, right? That a trope that gets thrown around is the best prediction of future behavior is past behavior, right? You see this slow moving train coming right at you, right? So let me ask you this. Has your dad ever listened to you? Well, I'm a pretty new listener.

No, no, no. Has your dad ever listened to you? Yeah. I would say yeah. He thinks I, I think he definitely respects my opinion. Okay. So if you sat down and said, dad, I love you, here's what I see coming in your life. You've got to get a job or you got to get a second job.

Like we've got to make some changes here. What would he say to you I mean that would definitely be be tough just you know him being an older older guy it is but hey we're playing big boy money if you're ready to put $50,000 down or you're ready to co-sign on a loan with a guy that has a history of not paying stuff back like then you're ready to do big boy stuff what stops you from having that what I would call a more honest because here's what you know, and I know this, but you especially know this, you're going to get this consolidation loan, you're going to co-sign your life away to it, and he's going to continue,

nothing will have changed in his life. Yeah, except for how much he would have to pay, at least that's what I think. Oh, the amount of money he's going to have to pay is still going to be there. Well yeah, so I have kind of talked to him about it, about all this stuff, and we've talked with each other about how we could try and figure it out. And you know, he knows he needs to make a lifestyle change. He's definitely living above his means. Yeah, let's pause there. Hold on, let's pause.

No, no, no, no, no, no, I'm jumping in here because you're still trying to talk us into this and that's not gonna happen. And I get what you're trying to do. I think John's right, you got a great heart, but you called and said, what should we do here? You just said dad's living above his means. So he's clearly spending more than he's bringing in.

What income is he bringing in and in what form? How much? So he's a real estate agent. He probably makes about 40,000 a year. Um, and he, uh, he took his social security early, which ended up backfiring a little bit because then after he took that, he made too much income to where now they're basically taking those Social Security payments back. They're not paying him.

What's his total debt burden again? $50,000. Okay. So, a real estate agent, and he's been doing it long enough to know how to sell houses, true or false? True. All right. and he's been doing it long enough to know how to sell houses, true or false? True. All right, so dad needs urgency.

And I'll leave it to my colleague here as to what you can and can't do when it comes to that, and I don't think it's much, but I do agree with John that you've got to have an honest conversation with dad, but it's in the form of a truth serum to say $50,000 in debt, dad, in the grand scheme of things is not a lot for somebody who can sell some houses and knock that out pretty quick. But there's something going on with him for a lack of urgency, the fact that he's being irresponsible. Again, not your problems to fix. But I think this has got to be a real honest but very respectful conversation.

And if he will listen to you, you can show him our plan and say, hey, I'm just starting to listen to these Ramsey folks and here's the debt snowball and I'll help you with the budget. I'll lean in every way I can, Pop, but you gotta make these changes or else I'm gonna get stuck with this

and I don't wanna get stuck with this. Here's what we're gonna give you, Jack. I'm gonna hook you up with two and I don't want to get stuck with this. Here's what we're going to give you, Jack. I'm going to hook you up with two, two different codes so that you can watch all nine of the Financial Peace University lessons digitally and you can send him one. He can watch it on his own. Okay. I'm going to send you that. But here's something important that I want you to hear me say. What you are trying to do is respectable and loving. You've got ulterior motives like we all do you don't get stuck with this down the road, right? But you also you've been watching your dad hurt for a while fair

Fair okay This will end with the destruction of your relationship with your father. Yeah, and Here's why when you co-sign on a loan with your father. And here's why. When you co-sign on a loan with your dad, it's the same thing I tell parents to not co-sign on student loans. If you can't afford it, you can't afford it. But what you end up doing is you put a transaction between two people that should be ride or die together, a father and a son. And there's gonna come a moment when he doesn't come through in a certain month and he can't

make that payment and you're gonna get the bill and here's what's going to happen. You're going to get enraged, as you should, and then you're going to begin to resent him. And that's not his fault. You signed the loan. And so the greatest gift you can give him is a son who's always in his corner. And by putting a bank between the two of you, you're setting up your relationship for failure. So saying, God, I love you, I just ran into these guys, this thing's amazing, because here's what your dad needs to do. If he's only making 40 grand as a real estate agent,

he's gotta go to Walmart and start throwing boxes. He has gotta go sit in a drive-through from 8 p.m. until 2 a.m. serving coffee or takeout or whatever. He's gotta go make some more money. And by the way, he can do that doing quote unquote less sophisticated tasks, whatever crap that is. He can go make more than 40,000 bucks,

but he's just gotta get on the horn. Yeah, he does not have to sell a lot of houses to make 40 grand. To pay off this $50,000 in debt, and the 40 grand, he's barely doing anything at all. So this is a tough situation. He may have to sell a car or two. He may have to sell a house and move down to a condo.

He's got to make some grownup dad decisions. But dude, I want to honor your heart, man. And I know you see this thing coming and you're already doing the math being like, dude, I'm gonna have to pay for this. But I get it. It's tough, tough, tough. I want to get to our Ramsey Show question of the day,

which is brought to you by Yrefy. Yrefy offers a different approach to paying off your default to private student loans. They do it with a low fixed rate for less stress. Go to whyrefi.com slash Ramsey. That's the letter Y, R-E-F-Y dot com slash Ramsey. It may not be available in all states. Today's question comes from Madison in Kansas.

Madison writes, I'm married. I love my husband, but we have made bad decisions over the last 20 years. We're looking at $125,000 in debt, not including our mortgage. Together we earn $150,000 a year. He's not interested in looking at our financial situation, but at least he let me handle our finances." Oh my gosh. Yeah, I don't want to talk about it, but I'll let you carry this anchor around all by yourself. Is it possible to become debt-free without your spouse being on board? Like, here we go, I feel like a gazelle with an anchor. Well that's a closed in a financial question, but John I'll keep it with you because that is a marriage question. Tough one there. Mathematically, theoretically, I

guess, if he just quit spending money, so it's just me being honest. If he truly does let her do the planning. If he stops spending one penny and you took full control, theoretically, mathematically, yes, it'll burn your marriage to the ground. I think this is a situation, Madison you set your husband y'all sit down for dinner you sit down for breakfast somewhere you sit down for lunch somewhere not when you're fighting about money not when it's time to do a budget and you say I am scared to death. People give me a hard time on on air I mean on the internet about saying this line I'm about to say but I think it applies here. Husband, I can't breathe.

I don't feel safe in this house when it comes to our money. And I can't keep carrying all this by myself. Will you look at this with me? And if he looks at you and says, Nope, don't care, then Madison, you got bigger issues in your, in your marriage, because it's not about money. It's about your husband saying, I don't care how safe you feel or not, it's on you. All right, business owners, last call, the pre-sale for the brand new book, Build a Business You Love ends April 15.

Pre-order now and get over $350 worth of free bonus items to help you hire smarter, lead stronger and grow faster. This is not theory. It's the system I use to grow my company from nothing and the same framework we've coached thousands of business owners through. You can only get the bonuses at ramsysolutions.com slash store so don't wait pre-order now. If you have a very simple tax situation like you haven't had any major life now. If you have a very simple tax situation, like you haven't had any major life changes or big investments, we want you to check out Ramsey Smart Tax. This is the tax software that Dave is in full approval of.

It's what the Ramsey team uses because we trust and help us get every penny we're owed. It's 100% accurate tax software that saves you up to 80% compared to other popular softwares in the industry. It's powered by TaxSlayer. I'm sure you've heard of TaxSlayer, been in the tax industry for 50 years and we doctored it up the Ramsey way to help you file right. So, better get on it. Filing early means getting the best deals and getting tax stress off your shoulders. Go to ramsysolutions.com slash smart tax. That to ramsysolutions.com slash smart tax that's ramsysolutions.com slash smart tax. Terrence is up in Atlanta. Terrence how can we help today? How you doing sir? I have a $1,200 card note.

Oh my goodness. Where's my thumbs at? What is it? It's a G2 key of finger. Oh my goodness. Where's my thumbs at? What is it? It's a G2 Kia Stinger. A what? Did you say a Kia? Stinger. Yeah, the

Kia, the sports car Kia. Wow. I've not heard of this model. Terrence. How much did that set you back? It was around like 60,000. I had another car to add on to it. No you didn't. Did you roll negative equity into it? Yes, and I needed something reliable because I traveled back and forth to Tennessee to see my kids. Bro, you did not need a stinger. You didn't You didn't have a stinger. You bought a stinger,

dude. Yeah. Yes. Yes. I bought a stinger. It was a bad decision. We love you. We're just having fun with you. I know the bad decision. By listening to the show, I knew it was a bad decision. So how can we help? Well, I have that and I also have $2, dollars a month child support. I was trying to figure out how can I get rid of the stinger. So every the first of every month you open your eyes and you're already 3,200 down? Yes, I make ten thousand dollars a month, well, $125,000 a year without overtime. Is that the only debt you have as the car? Yes, I paid off all, I started living with today Ramsey a couple of years ago then.

Last October I paid off all my credit cards. Okay, so how much, let's walk through this. Okay, go ahead. I do have one credit card that I would use only to go on the Sky Club and get a rental car. And that was another question that I had to ask y'all about that too. What do you the Sky Club and get a rental car. And that was another question that I had to ask y'all about that too. What do you do about when you need a rental car?

Do I just use my debit card? Yeah, that's what John and I do. That's what I use. That's what John and I do is we use a debit card. You don't need the credit card. So cut the credit card out because it's gonna remove the temptation. But let's dive into this car real quick, okay?

Because we've got negative equity. So what, you owe a total of how much I? Would like fifty seven thousand so fifty seven thousand and what is the stinger worth if you sold it private seller today? Probably thirty thousand thirty thousand. Oh boy. That's a bad That is a bath right there Oh boy, that's a bath. That is a bath right there. Yeah, cause the thing was I didn't mind, I don't mind paying for it, but by the time I, you know,

get around the paying bills and I see that $1,200 note, I'm like, woof. No, I get that. Listen, I have indigestion and it's not even my payment. I've got hemorrhoids now. Our bodies are falling apart on your behalf, Terrence. Oh boy. I can explain the first one.

I can't explain the second one. I can't either. I don't know how that works. Just my insides want one out. Okay, so let's walk through this here, John. So, see, the $57K also involves the negative equity, correct? I think I'm done with the negative equity part. All right. So we owe $57K. Yes. All right. So I had the car for two years now. Yes. All right. So I had the car for two years now. How much so you make you have $2,000 a month in child support.

You bring home $10,000 after tax. No, that's before taxes. All right. So what's your actual bring home? My salary is pending. What's your bring home? I bring home like $6,200 after taxes in child support. Oh, after.

Okay. Child support. $5,200 after child support. Oh, after, okay, child support. 52. After child support. 5200 after child support. Oh, okay, good. All right, so what I'm trying to get at is how much, John, I wanna get to quickly, how much could you, how much could you, if you just pay the bills, just your basic bills and your child support

and this car payment, how much money left over do you have that we could put towards saving Saving to get a I'm thinking about a $10,000 car or something that's dependable maybe 7500 if I find myself a higher mile Honda or Toyota That'll get you back and forth to Tennessee. How much money could you put away each month right now? I could probably fill away probably $1,400 a month. Because after each check, I'm rolling around $1,300 after everything. So what I'd like to see him do, John, is I'd like to see him save as much money.

Let's get a $5,000, $6,000, $7,000 car and let's sell this stinger and now we're at least, you know, we're now working on $30,000. Uh, no, no, $27,000 roughly is what we're working on. Or here's, here's the other side of that. If you take that $1,200 a month payment, you take that $1,300 extra and you go through your budget with a magnifying glass and you stop going out for a season and let's say you can scrounge up three thousand bucks that includes this $1,200 you can pay this thing off okay I became a cheapskate okay so I've been chicken

salad sandwiches. Like I've really just tried to, I've really cut back just to see, to figure out was it me or was it just a lifestyle or anything and everybody been looking at me crazy like, hey, you want to go? I'm like, nope. Good. Good, good, good. Can't go nowhere when I got this to pay.

So a principle that we live by here is things with wheels should not cost more than 50% of your income. Got it. And so you're right there on the bubble here. So if you want to just to suck it up for 20 months and throw $3,000 a month at this, you could. Or like Ken said, you're going to suck it up for 10 months, throw $3,000 a month, get that 30 down to where it's just bottoming out and then you can try to sell it on the

market. Yeah, but that's another option. I gave you what I would do. I like what John's saying too. I'm doing what Ken would do. I would get rid of this thing out of my life. Yeah, I want to get rid of it man because before I got this finger I was driving a 2012 Buick LaCrosse which I didn't have no problem driving. That's a car of a ladies man. Listen, Terrence, I think very few guys could pull off a Buick LaCrosse like you could. I just got a sense you got enough swag. Man, I loved that car.

Well, get you another one. I got hit in a high speed chase and it told me. Like, I loved that car. Tell me that you weren't being chased. No, no, no. I was sitting in traffic and got hit by a police officer. What's a decent Buick LaCrosse going to set you back? Probably that. Well, I bought that one in 2018 for 10 grand. When I went to looking after the red,

they went up to like 16,000. Yeah. They're pretty... Yeah. Listen, I'm going to challenge you to get somewhere, try $7,500. I think you can get something dependable. A car maker that's very dependable, you know the ones that just, they're going to run forever. I'd take my chances on that. I'd do less cash right now because you've got to get out of this deal. Here's the words we use, Terrence. This isn't an accusation.

This is us having some fun, but you're going gonna pay about $30,000 in stupid tax. Okay. And if you if you just know that every time you send that check it's just I'm paying stupid tax, write it in the little thing on the bottom of the check. Stupid tax. Or when you're making online payment just put stupid tax. And by the time this 10 months is up and you've thrown $3,000 a month and you haven't been on a date You haven't been to a restaurant. You haven't seen a concert. You're gonna be you will never do this again Never I want the ones that learn real fast And then you bought money again, are we done done

I'm done good. That's amazing. I'm done because I got a daughter who's about to go to college. So I want to have the money. I have the nest egg. I did the baby steps. So I cut the credit card. I love it. Well, this is super intense. You got to be super intense to do that three grand a month.

You can do it. You got overtime options. What you let that slip out. You let that slip out. So I'd be getting overtime. I'd be working weekends. And to John's point, if we can sock 3,000 at a minimum away towards this, the 27,

get yourself another Buick, my man. And people are gonna watch you work like crazy over the next 10 months to a year, and they're gonna think you're gonna roll in there with a G3 or a G wagon. Listen, you're gonna roll in with a Buick, let them know I'm opting out of the game and I saw for peace not for a cool shiny depreciating asset but I mean he likes it he likes that lacrosse I think you can find himself a nice look dude a guy who is in on a Buick lacrosse

that's marriage material right there Music you