The Ramsey Show - You Can’t Outearn Bad Spending Habits Forever

Episode Date: November 26, 2024

📈 Are you on track with the Baby Steps? Get a Free Personalized Plan 📱Watch the full episode for free in the Ramsey Network app. Dave Ramsey & Rachel Cruze answer your questions and discuss: "I hate my job and want to get out of debt," "What's the benefit of using an escrow account?" "I'm behind on my credit card payments," "How do I get my kids off my payroll?" "Should I invest in real estate?" Support Our Sponsors: 🌱 Get 10% off your first month of BetterHelp 🏥 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 💤 Visit Helix Sleep for special offers! 💻 Visit NetSuite today to learn more 🗂️ Use promo code RAMSEY for 18% off at The Nokbox 🏛 Get started with YRefy or call 844-2-RAMSEY 🔐 Visit Zander Insurance for your free instant quote today! Next Steps 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 🎟️ See Dave and John LIVE in a city near you! 💵 Start your free budget today. Download the EveryDollar app! 🛒 Black Friday deals are here! Get meaningful gifts for as low as $8! Listen to more from Ramsey Network 🎙️ The Ramsey Show   🧠 The Dr. John Delony Show 🍸 Smart Money Happy Hour 💡 The Rachel Cruze Show 💸 The Ramsey Show Highlights 💰 George Kamel 💼 The Ken Coleman Show 📈 EntreLeadership Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Hey guys, Black Friday week is here with five days of deals starting at just $12. Go to ramsysolutions.com slash store to check them out. Live from the headquarters of Ramsey Solutions, it's the Ramsey Show where we help people build wealth, do work that they love and create actual amazing relationships. Rachel Cruz, number one bestselling author, Ramseysey personality my daughter is my co-host today. Open phones a triple eight eight two five five two two five. Elena is in Huntington West Virginia. Hi Elena how are you? I'm doing good how are you? Better than I deserve. What's up in your world? So I've been watching you for a long time

for years now and I have just saved my $1,000. Good. And I am also drowning in student debt, credit card and my car loan. I do have a job. I make about $50,000. My debt is a little bit more around $65,000. I hate my job and I want to go to school, but I don't know if that's a good idea because of the amount of debt that I have. Trying to figure out what the best way is to get out of this mess basically. What's your current job?

What do you work in that you're not enjoying? I work in property management. I'm an assistant property manager. Okay. And is it the field that you're not enjoying or is the specific company do you think? Because you said you want to go back to school. I'm just curious what else is out there that you're thinking. Yeah so I think it's just the field. This is actually the Christian based company which is super awesome. So I think it's just a field. I'm not happy here. It's just not fulfilling. I do love kids. So I've

always wanted to pursue NICU nursing, but I would graduate in Hawaii and the diploma I got from there is not recognized. I would have to go back to school for a GED and then go to college. But with all the debt and the mess that I have is just kind of overwhelming and I really don't know where to kind of where to go. Well I think we're doing this a little bit backward. You want to run to something not from something as far as your career goes. And so what I would do if I were in your shoes is I would very clearly identify and spend some time and some soul-searching and we'll even give you some tools to help

you with this identifying exactly what you want to do with your life in this next chapter. Going back to school in air quotes is a really bad idea unless that particular degree is necessary to do the thing you want to do. Okay. Right. And sometimes when people are running from something they air quotes go back to school as if that's going to solve anything It's not gonna solve anything You need to actually be studying Toward becoming the thing you want to be. Did you say you want to be a pediatric nurse? I'm Nick you nurse a Nick you know, so yeah. Okay, and your high school diploma does not count

and your high school diploma does not count? Yeah, so I graduated from a competency adult community school and apparently that is not recognized nationally and I have to go back for a GED, which is crazy because I've been using that pretty much my whole life. So. Okay, so right now you're a high school graduate that needs to pass a GED to prove it, right? Basically. And then you would have to go through all your undergrad and go

through nursing school to be a nursing NICU. Okay. So what Ken Coleman would tell you to do that is one of our RMSE personalities is written extensively on this idea is he would tell you to go over there in your off hours and Volunteer in the NICU to rock babies That was true and talk to the nurses that are there and Tell them it's gonna take you six years to be one of them. Is it worth it? Yeah, now I'm a huge fan of nursing as a career field, but I like little babies is a long way from I want to go to school for six years to be a NICU nurse.

That's a different thing. That's a lot different. Okay. So, because nursing at times is gross. Nursing at times is very stressful. Nursing at times will break your heart. Nursing at times will cause your back and your feet to hurt and ache. It's hard work.

It's a great career field, but it's way different than I have a heart for children. You follow me? Yeah. So what I want you to do is get your arms around what it is you want to do and exactly what the cost is. And then I don't want you to spend six years and end up in a field that you hate accidentally. You wouldn't want wanna do that.

So number one, we don't wanna go back to school in air quotes as an escape mechanism. Number two, if we're gonna go back to school, let's make sure that whatever we're studying gets us there. And then number three, what are some interim steps we can take to move in the direction of the field while you're talking about going to school there? So while you're working on your undergrad and passing your GED and getting your undergrad going at your local community college there in West

Virginia, which you can do your first two years there just fine, you're probably keeping the job you've got. Or you're getting a better job making more money but maybe not in your career field. Or if you can find something where they'll pay you $40,000 a year to be in and around the medical field and you can get a sniff of what it is You're signing up for then I would go along with that Yeah, and I would tell you to Elena just with the numbers you gave not even thinking future just presence, right? You're you're the money you need Yeah

And so what are things you can do? Cause I would tell you, regardless if you wanted a career change or not on this call, part of the solution of you getting out of this debt is gonna have to be upping your income. And so whatever you're doing beyond your current job, let it be around kids.

Like I would go on care.com and see if somebody needs a nanny from six to nine PM or whatever, right? Like finding things in that that are gonna make you more money to get out of debt and start your financial process and this ball rolling to get you ahead financially. But then also if you compare that with some level

of your passion of what you're talking about while at the same time doing exactly what you're saying. But you need more money right now. I mean in my opinion for the amount of debt that you have. You can scratch the kid itch by joining the children's ministry at your local church. Yes. And they need your help, by the way, because they're always perpetually understaffed. And again, this isn't about... I do have a... Go ahead, do you have a what? I was going to say something really important too, because I am a believer and a follower

of Christ, but I did do something really stupid. And when my sister passed away early this year, I would say I was super vulnerable and dealing with grief, not knowing how to deal with grief for the first time. And I ended up moving, of course, from my first job early this year, paying about $70,000 to live with my boyfriend. And now we're living in this house unmarried. We're not seeing eye to eye in terms of finances. And I have a little bit of a family.

That's easy to undo, isn't it? Yeah. Yeah. Move out. My dad always said, why pay for the cow when you can get the milk for free, right? So I was kind of struggling. Yeah, your dad's a wise man. So yeah, but you can fix fix that you can just move out.

Where were you living when you were making 70? In Arlington, Virginia. Can you get that job? Oh that's more expensive than Huntington, West Virginia. I don't know that you were netting 20 more. That's a very expensive place to live. Okay yeah I mean you can you can reverse that you can just say hey I'm doing something I'm not proud of and I'm not gonna do it anymore that's a decision just like the decision to do something wrong is you can make a decision to do something right so go do that kiddo hang on we're gonna get you signed up for Ken Coleman's everything I want her to get the assessment and the proximity principal book and the whole thing

and the proximity principle book and the whole thing. Are you working the baby steps? One of the smartest and most impactful changes you can make is to ditch your cash value life insurance plan, if you have one, and replace it with a term life policy. Listen, the only thing a cash value policy is good for is overcharging you for the life insurance and then paying you a crappy rate of return on your overpayment. Stop wasting your money and really focus on getting out of debt and growing your savings. For over 25 years I've trusted and used Zander Insurance to find the best rates on term life insurance from the top rated companies. They keep the whole thing simple. You can apply online or over the phone and they they even have low cost plans that don't require an exam.

Go to Zander.com or call 800-356-4282. Even if you don't have a cash value policy, if you're one of the 70% of people who have no life insurance or not enough, it's even more important to get this done. 800-356-4282 or zander.com. Black Friday is here. We've got gifts for everyone on your Christmas list. Our best selling books like The Total Money Makeover, Baby Steps Millionaires, Own Your Past, Change Your Future and more are on sale for just $12 each. The Total Money Makeover of course is the road map that's helped people walk the baby steps over 12 million of them now. We hear it all the time millions have become debt-free. It's the proven step-by-step plan we talk

about on the Ramsey Show, just 12 bucks. And Rachel's newest kids book, I'm glad when I can share, is also here in time for Christmas. We launched it last week for sale and it's $19.99. It is the third in a series that's a trilogy and you can get all three if you want and there's a package for sale right there for all three and they're high quality paper, high quality everything. These are kids books that will survive toddlerhood. They're well built $54.99 for all three. Check out the Black Friday deals at ramsaysolutions.com

slash store. And this thing took off, it did good. Yes it did, I know. It's a great series. It is great. It was a fun project to do, and talking about the intangible parts of money, contentment and gratitude, generosity,

those kind of topics I feel like are harder sometimes to grasp and to teach your kids. So I was like, okay, how do of topics I feel like are harder sometimes to grasp and to teach your kids. So I was like, okay, how do we put that in a sweet children's book? So those are the three topics and they're short, you're welcome parents, they rhyme, the illustrations are beautiful

and it's the same animals in all three books. So that's been fun, people buying each one as they've launched, that they see the same characters. So you'll get to kind of follow them along on these adventures, learning about these topics. And the and the Illustrator Lauren just did an incredible thing. Yeah I mean they're just they're beautiful. It's world class stuff. It's really really. Real proud of this product for those of you that got kids and grandkids be sure and check them out because you do hey listen you know you

teach a child gratitude you teach a child generosity generous people are just highly attractive You're teaching your kid to be a high quality adult when they are grateful and generous That's a because think about how many adults you wish were grateful, and you wish their parents had taught them that hello So I mean that's part of being a good dad a good mom a good grandpa good grandma too, by the way Do not think that Papa Dave is not above reading his daughter's to his daughter's kids I have been known to keep it all in the family here. It's happened. All right Justin is with us in San Diego Hi, Justin. Welcome to the Ramsey show Hey, you guys. Good morning. Thank you for your your time also. Sure. I'm trying to figure out,

I have a three-year-old and all the money that we give her for her birthdays and like holidays and things like that, we've just kind of been putting into a CD that's yielding about 5.29% annual return and I want to give it to her when she's 18 as like a life starter kind of fund. So I don't want to put it into a 529 or retirement fund. Is there anything better that has a higher yield or better return for her when she does reach 18? Are you saving for her college? I'm active duty military and I just finished my masters. So I've already transferred all of the benefits over to her.

So I'm going to take her through, you you know community college and then I'll pay for that and then pretty much all of her masters is gonna be completed. I already paid for it. Okay. If she has all that already. Okay the answer to your question is just a simple mutual fund and when I'm doing something like that I just pick a good growth stock mutual fund that has a long track record. And I did that for our kids because when Rachel was a baby there was no 529s or ESAs. And so we used just put the money in the kids name and then it's taxed at the growth is taxed at the kids rate which is nothing for a long time because they have a standard deduction and so

the It's called an UTMA uniform transfer to Miners Act Which is by the way the exact same document you use to open up a savings account if you put her name on that savings Account you opened that CD. I did okay Okay that's called an UTMA, it's an UTMA as well. Anything you do in a kid's name that's not 18 years old where the parent is the custodian falls under the UTMA, the Uniform Transfer to Minors

Act. It's a law, okay, it's a process because you can't contract and do financial transactions until you're 18 years old in America. Children can't have a stand-alone account, it's impossible. Parents have to be on it or someone has to be on it as a custodian and the UTMA. Now the downside

with the UTMA is when they turn 18 years old, technically speaking, the money is theirs and you have zero control. So if you have a 17 year old heroin addict with $100,000 getting to come her way, you don't have control. Well, I mean, you don't have control over it. Maybe a 17 year old who likes to shop. I don't know.

Someone has a 17 year old out there. Someone did. Okay. So you don't have control over this money You're getting ready to fund her misbehavior if she's misbehaving at 17 Okay, okay, so be care you need to be aware of that or Like with our kids what we told them is if you're misbehaving. I'm gonna steal the money and sue me Good luck, but that's illegal okay. You can't really do that. And I

can't advise you to do that. So, but I'm not gonna fund your misbehavior. I'm not gonna save up a hundred grand for you. I know, but come on. Justin's, I mean, like, he's gonna give her money. I believe you, Justin. You feel like a solid parent. Yeah, I'm sure his angel's not gonna make any mistakes. No, I'm not saying that she's not gonna make any mistakes Okay, so the thing is this that's what you're up against. I personally did not I went that route for your old college fund Yeah, I did not go that route for the little savings account that he's dealing with We kept that little savings account birthday money and that kind of stuff in place, right? And that was the money that helped seed your first car. That's right.

That's what I was gonna say, Justin, depending on the amount, you know, this could be something that she gets earlier that is attached to something that she's wanting, whether it is, you know, a car at 16, but something that is useful for her that doesn't necessarily have to be this like big investment and put it in a big investment fund.

But would you still, I mean, still with the longevity of being three to 18, you know, that 15 years you would still probably put it in. Would you still put it in a mutual? I don't mind 5% because it's not gonna be that much money. I mean, it's not, it's not gonna be $25,000. It's gonna be $2,500. So if it's just that putting birthday money on there, grandma's 20 bucks. Yeah. But if he wants to be funding more of his money, then you would do a mutual fund over here

For more money to be putting in there for the daughter Yeah, I would but and so to expand on that one step further what we did do also Was we took the kids little miscellaneous savings account and we added to it And then when they started talking about being like 10 or 11 years old we start talking to them about we're not buying you a car when you turn 16 we will match whatever you put in we're gonna do 401 Dave and I'll match whatever you put in and so if you put in nothing you're gonna have a nice bicycle when you're 16. So get, you know, let's start talking about

doing some chores and putting some money and adding to this little account that we've already got started for you. And then they save up. And if I recall, you can correct me, but if I recall, you had somewhere around with, you had somewhere around five or $6,000 and we matched it. Hold on. Okay. I had eight. Eight. Okay.

Thousand dollars. And I put eight with it. Yeah. And you got a little used 16,000 dollars. It was a great car. Took me all the way through college. It was a great little car. It was good. It sure did. And, um, and the other two siblings did the exact same thing. I will tell you parents, if you're gonna use that matching idea, be careful if you have, in case you have one of those kids

that is a nerd super saver, and this highly motivates them, you may end up having to match 30 grand if you don't put a limit on it. So I would suggest you put a limit on it. I did have one of those, her brother named Daniel, and he just about, well it was ridiculous. And so we had to come around

and come negotiate a different thing. I did match him, but he was generous with some of the money and used some of the money for his car because it was so stinking much. And he bought your old Jeep or something. I mean he even, yeah. Yeah, he's just a conservative dude. But I mean he even yeah. Yeah he's just a conservative dude but I mean he saved everything. It was crazy. So put a limit on it. We will match it up. He got a head start

parents too. Yeah. You watch the other two. You know I'm like four years shy. He had four extra years on us. Yeah well he watched you two and found out we were serious about this. That it wasn't a game. We weren't kidding. And he went oh crap I really got to do this and he turned on the coals and there you go. So put a limit on it and you can do match serious about this, that it wasn't a game. We weren't kidding. And he went, oh crap, I really gotta do this. And he turned on the coals and there you go. So put a limit on it and you can do match. And I use the small accounts for something like that. I use the UTMA for a big thing.

If you're doing a big thing, Jerry, that's what I would do if you're going that way, Justin. This is the Ramsey Show. Okay, here's the hard truth. Your investment dollars could be winding up in the pockets of companies that hold positions you don't agree with. People are unknowingly putting money into tech giants and household brands that don't match up with their core values. But here's good news. Timothy Plan is at the forefront of biblically responsible investing. That means Timothy Plan uses a strategy that lets investors chase competitive returns while staying rock solid in their beliefs.

So if you're ready to invest with a clean conscience, it's time to check out Timothy Plan. Request information at TimothyPlan.com to learn more or contact your financial advisor today to see if Timothy Plan is right for you. TimothyPlan.com Investing includes risk, including possible loss of principal. Before investing, carefully consider a fund's investment objective, risk, charges, and expenses contained in the prospectus or summary prospectus available at TimothyPlan.com.

Read carefully before investing, mutual funds distributed by Timothy Partners LTD and ETFs distributed by Forsyth Fund Services LLC. Rachel Cruz, Ramsey personality is my cohost, number one bestselling author and my daughter. If you like what you're hearing here we could use your help. You are our marketing plan. Spread the word on this show. Share the show, click the share button you can subscribe and you can follow and you can leave nice five-star reviews and you can click the clip of the link out and make a copy of it and send it to your friend by email and go listen to this is this stuff's helping me with my life because that's

what we're here for and we need your help we need to have more people that we're helping that's what we're doing and thank you for those of you that have been doing that because our numbers are ridiculously up and we don't even have a stadium named after us like SoFi or something like that. Sorry the allergies are bad but the um yeah you're our marketing plan. We're not dropping 300 million on a stadium. You're it. So thank you. We're either helping you or we're not and that's what we're here for. Thank you very much. Courtney is in Dallas. Hi Courtney, how are you? I'm doing good. How are you guys? Better than we

deserve. What's up in your world? Nothing much. I was wondering if you guys could tell me what the benefit is of not using an escrow account to pay for home insurance and taxes? Two things. One, you get to keep the money all year and earn interest on it instead of it sitting in an account that's non-interest bearing until you pay your taxes and pay your insurance. So it accrues interest. And the second one is you don't screw up the accounting. And mortgage companies notoriously screw up the accounting on escrow accounts. And they get out of balance and there's an escrow shortage and then they raise your payment

to make up the shortage. Or they just miscalculate something and you've got somebody that's the lowest common denominator running the calculation too many times. And when I used to own a bunch of property with debt back in the day, I would say as many as 40% of the accounts were screwed up. So I don't know if it's still that bad because I haven't had a mortgage in 30 plus years, but I suspect it is still a problem. The benefit of using the escrow account is it's on autopilot.

You don't have to think about it. Right. Okay. And most people don't manage their money well enough they end up not having the money to pay their taxes or not having the money to pay their insurances sneaks up on them like Christmas. Yeah and I know that some mortgage companies don't even give you the option sometimes they require you to use an escrow account. Correct. A typical conforming mortgage meaning if any FHA or VA will require

it because they want to make sure that the house they have a lien against doesn't burn or isn't taken for taxes. Right. Okay. And so yeah, you don't really have a choice. I personally, if I were you, I would just use the escrow account, but I would stay on them to make sure it's the proper amount. Okay. How do you recommend staying on top of them? Well, you just want to make sure that the amount being taken out of your payment for print, your payment is principal interest. If it has escrow, it's taxes and insurance, P I T I.

And you want to make sure the amount being held out for taxes and insurance P I T I and you want to make sure the amount being hailed out for taxes and insurance each month is 1 12th of the total of your taxes and insurance it shouldn't be one it shouldn't be less than that because you're gonna come up short and then they're gonna have a shortage because they're gonna pay it either way they don't want to get they don't want you behind and then or there could be an overage let's say they're taking out more than they need to and so just make sure that the numbers are right and just look at it once a year and make sure they're not You know if your taxes and your insurance Actually go up and they don't change the amount being withheld for it. You're gonna get behind right?

Right, that's that's one of the ways you'd look at it. So that's the kind of thing you're doing So I I would use the escrow if I were in that situation. I don't recommend, because I put everything on autopilot that I can. Just so you don't have to, yeah. So say- Everyone. Yeah, even though it's not earning interest.

It's not enough interest to matter. It's okay, yeah. Yeah, and more people are gonna screw it up by not saving up the money when the mortgage companies gonna have the escrow account. Yeah that's probably true. And we have a part of our website that talks all about this and all real estate at ramsaysolutions.com slash real estate that's kind of our real estate home base because we just it's one topic when it comes to your money that we get

so many questions so if you guys need more resources, there's free stuff. Videos and articles and calls from the show, there's so much there to help you in this topic of your money when it comes to your home. Yeah, ramsesolutions.com slash real estate. Honestly, that portion of our site is massive because we get so much question on real estate and it's really a nice resource to help you for sure so good stuff good question

Courtney yes excellent excellent question Jerry is with us in Norfolk Virginia hi Jerry welcome to the Ramsey show all right thank you so I'm my question I have a bunch of accounts I have a Charles Schwab brokerage account. I have Charles Schwab IRA traditional and a Charles Schwab Roth. Now I also have a principal. Now principal's the company my employer handles our 401. So I was looking at their website

and it looks like they charged me about a hundred bucks a month to have that account. Really? I have the option. Really? Yeah, I thought that was kind of high. That's wrong. Well, that's what it says under fees.

You have a 401k and they're charging with your company? Correct. I'm a hospital employee. And there is a 403b or 401k? 401k. And they're charging you $100 a month? $1,200 a year. Actually $300 a quarter if you want to be specific. But yes, basically a hundred, yeah, it says it right here. Plan administrative services, 288.70. Is that being deducted from your account or is your employer paying that? I don't know.

I'm just looking at the website where it says plan fees. So I'm assuming I'm paying it I'm not because you shouldn't be Okay, well that's a plus I would be very unusual as a matter of fact your employer shouldn't be paying that much per employee That's asinine amount of money Yeah, I kind of thought so yeah, I don't pay anywhere near that. I got 1,200 employees with a 401k plan here. No, not even close to that.

I would fire those people in a heartbeat if they were charging me that. Well, how do I find out if I'm paying that then? Call HR. Because they said on the website, it says plan fees. Yeah, well, I mean, it can be a plan fee, but the plan wasn't instituted by you. It was instituted by the employer.

So it's possible they're being charged that. That's just ludicrous. I would call HR and I would call principal both and ask them. Okay. Just call principal and go hey I got a 401k and I'm looking at the statement here and this feels like you know like you guys should be wearing a mask like you're robbers. Oh my gosh. No, really. That's just ridiculous. What was your question though, Jerry? Your original question you called in.

So my question was, now I now have the option of instead of the money going to principal to take care of it, I can have it go to Charles Schwab. Which then I would have one hundred percent control. The hospital is allowing that yes yeah they I don't know if that's new or not but I was actually talking to them and they said if you want we can have it go to Charles Charles Schwab account so I'm assuming it's some kind of lockdown type account. But then I would have total control to buy, sell, or do whatever I want with it. But that kind of scares me because at least with principle I have theoretically an expert

looking after it versus me the amateur looking after it. So I'm basically looking for your advice. Is the $1,200 that I thought I was paying worth an expert looking at it? No. But you can get another expert. You don't have to do this other thing. Okay, I'm seriously confused. I have no idea what the flip your company is doing.

Because a 401, a company has a single 401k administrator if principal is their administrator they cannot send your 401k money to swap it's illegal they can't do it you have a single you can have four different 401k companies at your company it there's no such thing it doesn't work okay so I absolutely have no idea what you're up against the This show is sponsored by BetterHelp. This month is all about gratitude, and most of us have people in our lives who we're grateful for.

One of those people for me is the great Jean-Noel Thompson. He taught me how to be a dad, a husband, a professional, and how to balance caring for a bunch of people all at the same time. We all know of somebody else we can be grateful for, but there's one person that we often don't take time to thank. Ourselves. We don't always acknowledge that we're surviving, that we're moving forward, and that we're working towards a better life and better relationships. And in a world where everything's gone bonkers, it's not always easy. So here's my reminder to thank the people that you love, thank the people in your life, and thank you.

Sometimes we need some professional help to talk to somebody trained to help us discover true gratitude for ourselves and others, especially in the holiday season. That's why I recommend BetterHelp. BetterHelp is 100% online therapy. You can talk with your therapist at any time so it's convenient

for your schedule. Just fill out a short online survey to get matched with a licensed therapist. Plus you can switch therapists at any time for no extra cost. Let the gratitude flow with BetterHelp. Visit BetterHelp.com slash Deloney to get 10% off your first month. That's BetterHelp, H-E-L-P dot com slash Deloney to get 10% off your first month. That's betterhelp.com. Rachel Cruz Ramsey personality is my co-host. Joshua is in Seattle. Hey Joshua, how are you?

Doing good. How are you? Better than I deserve. What's up? So, I recently retired from the military, medically retired from the military. And after I had gotten out, there was about a month of no household income whatsoever. And we kind of ran into some financial hardship and, uh, with Christmas coming up, I have three young children. Um, and I'm wondering, should I kind of sacrifice, um, their happiness Christmas morning, uh, to continue to pay off this debt.

I'm about $1,800 in credit card debt and about $4,000 in collections right now. And roughly bringing in about $5,500 a month. $6,000 a month. How old are you? I'm 24. Thank you for your service. What happened that you were medically discharged? Are you okay? So I was injured in line of duty. My back was injured and they decided that I could no longer serve

how they needed me to. Okay. Are you, are you okay to, for other things though? Are you able to, are you back to work doing a job now? So I'm currently not working. Um, I am drawing pension from the military. Why are you not working? I'm currently going to school full-time. Okay. Why? I want to, I've always kind of worked more labor type of jobs, hard on your body. What are you studying? I'm going to school for a business administration with a major in project management. Okay. And you just, and you just started. Yes. I did. Just, I just started planning to not work for four years. Yes. Is your wife working? No, we have three young children.

She's staying home. Okay. And when I went through four years, I worked 40 to 60 hours a week while I was going to school absolutely you need a job yes I have been networking a little bit trying to get an internship or an apprenticeship somewhere I don't want you to get an internship or an apprenticeship I want you to get a job okay you need money yes I'm aligned with you using your military benefits to get a degree. I'm not aligned with you not working for four years while you have three kids and you're calling me about them having no Christmas. Absolutely. No, no, no, of course. But I'm bringing in around $63,000 a year. I know, but you're calling me about not being able

to buy your children Christmas and you're not working. Absolutely, that's just because of the, well, obviously military doesn't pay very much. I just got out of active duty. And we hit a... So Joshua, I think here's the hard thing. If I could, if I... Go ahead.

Well, if I can just be pretty frank with you. Absolutely. You know, what you have done, service for our country, like incredibly grateful for you and all military families out there. I can't even imagine like what you all go through. So I, so appreciative. But now on this side, you know, you're 24, you have a wife,

and you have three kids. And there's a reality of a world that is, hey, I'm a grownup and we have responsibilities, and we don't get a choice just to go do what we want. We kind of have to do what we need to do. And what you need to do, right, is start having money in. So if I were you, Joshua, and I don't know how far you are into this maybe one semester of school, but if it's too much of a load not to be working full-time and maybe it's you're driving Uber,

but I'm just saying even for a year or two this is where you want to go, but you guys are underwater financially. So to me there's not a choice to go to school. I would be finding a job. a choice to go to school. Like, you know, like, I would be finding a job. Well, you can go to school and job. Yeah, that's a lot though, but in underwater. I worked 40 to 60 hours a week and graduated in four years. I know, but they have $4,000 in collections, so like. So go to work.

Yeah. So here's the thing. When does classes let out, dude? So I'm currently online, fully online. Oh okay good. So you control when you want to go to class? Yes. Oh that makes it even better. So you can work like an eight hour day. Yeah but we did just have a newborn.

Honey, your wife is at home with three kids. That would be like her job. Absolutely. wife is at home with three kids. That would be like her job. Absolutely. You need money. You need to go get a job, Joshua. Like right now, you need to be doing grub hub and Uber and something else by the end of the day and you can buy your baby's Christmas. And by the way, the newborn don't even know it's Christmas. So this is not an issue here. Okay. You feed them and change their diaper. They're happy puppy. All right. So let's move on. I've old they don't really know they don't

have any idea what's going on here but dude you can't call me up and act like that you can't fund Christmas this is Thanksgiving you got a whole freaking month you can save up the money for Christmas by working during this month that is the answer to your equation Go get six part-time jobs that equal eight to ten hours a day and do your stinking Online at night while the babies are asleep. I wrote financial peace from 10 p.m. To 3 a.m That's when I wrote that book because I had babies I had to feed and I couldn't sit there and go, I'm now an author, I don't work anymore.

I didn't have that as an option. The freaking electric bill guy didn't care if I was an author. He wanted like money or they cut off my electricity. Because if he's, and he's pulling the 6,000 from his pension. He's got a lot of money coming in. But yes, that's but is that is that robbing from his retirement? No, no, no, no, no, this is his military retirement is huge because he military disabled because it's a okay. Okay, he's getting

Taking from their like when they want to retire got a bazillion dollars coming in No, it's just that he had he makes seventy two thousand dollars. You're sitting on his butt and coming in. No, it's just that he makes $72,000 a year sitting on his butt and they pay for him to go to school. And we, the taxpayers, and we should. That's fine. But dude, the answer to your question is not only do your kids have Christmas, you keep working after Christmas and you only need $5,800 to be debt free. You can have that by March. So first let's go get the kids some Christmas and then let's get Joshua out of debt by March. And Joshua, can I just tell you too, as a mom with little kids, especially if they're a newborn, a two year old, I mean he's 24, so a two year old and a three year old, like

I'm assuming they're all under six, I would think. They don't know, like go to the Target section and they just want to open up gifts, like They don't know, like go to the Target section and they just wanna open up gifts. Like they don't really care what's in it. They just wanna have the wrapping paper and the experience of opening gifts. So like, go so cheap, like go so cheap. That stuff is gonna be thrown out by April anyway.

It's all the crap we buy. So like, yeah, so even that. And that's for all of them. I mean, that's for all of us. I gotta tell you, I mean, Rachel, when she was little, we would spend all this stinkin' money on the kids' Christmas, and then dad gum Uncle Mac would go to the dollar store and come in

with a garbage bag full of toys that were garbage. And he was a bigger hit than we were, and he spent like 20 bucks, and we spent like 200. And let's just say too. Uncle Mac was the fun uncle. That's right and in this consumer driven world and especially in this season, your kid like, I wanna, you know,

I think his phrasing was, and then this is not to pick on you, Joshua, cause this is everyone, to make my kids happy. It is just stuff, like the most, like we are such a disconnected culture anyways, like the amount of people that we are on devices and phones and TVs and screens, like your kids want you parents, they want you. So like go find an experience to do with them and that's gonna create more

memories. Not Joshua, they want him to go to work. Do what? I said his kids want him to go to work. They don't want him. They want him to go to work. Well he needs to go to work and he needs to be with them when he can. No, he can be with them a little bit later. Right now want him to go to work Well, he needs to go to work and he needs to be with them when he can not He can be with them a little bit later when now he needs to go to work Right now he needs some money Call me up and tell me you can't buy your kids Christmas I'll cry for about 30 seconds and one until I find out you don't have a job Okay, and then my crimes done. I know but my point is last Thanksgiving We took the kids to a school parking lot and they rode bikes around. We all rode bikes around for an hour and they still talk about

like I'm like that's what I'm saying is kids are so low maintenance so Joshua don't put that pressure on parents out there this Christmas like and by the way they already had the bikes so it was built in that was like a freebie so there we go. Yeah, there you go. Wow. Joshua you got this. You can do it. Go to work. You got this. Hey, we are proud of your military service and we love you so much. We're going to tell you the truth. Don't call her if you don't want that. This is the Ramsey Show.

Do you ever feel like you're finally making progress towards your goals only to get quickly distracted by something else in your feed? Well, that's why we created the Ramsey Network app, your single source for content that keeps you motivated. The Ramsey Network app is designed to keep you laser focused on reaching your goals. Loaded with over $7,000 of Ramsey shows, this free app is the best place for uninterrupted content and no distractions. Plus you can search specific questions to get more personalized content in seconds.

So, for the days you need some extra motivation, you'll have proven advice at your fingertips. It's time to get serious about your goals and shut out the distractions for good. Simply search Ramsey Network in the App Store or Google Play. If you're listening on a podcast, just click the link in the show notes to download our free Ramsey Network app today.

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love and create actual amazing relationships. Open phones this hour as we take your calls about your life and your money the phone number is 828-825-5225. Number one best-selling author, Ramsey personality and host, co-host of the Smart Money Happy Hour, Rachel Cruz. My daughter is my co-host today. Thank you for joining us. Teresa is with us in Fort Worth, Texas. Hi Teresa, how are you? Well, how are you? Better than I deserve. What's up in your world? I have grown children that I need off my payroll. Um, and I'm, I'm on baby step two. I've over-saved actually on one,

and I can't seem to get any further because I have a 30 year old that works part time. He says, he can't find a job. His resume is three pages long. He has no education, no skills per se. Um, his father, we can go way back was abusive. So he was, um, put in a mental place for a while for PTSD and some bipolar issues. So when he gets out of that, and now we don't have a full-time job. Um, my daughter is wanting to start back to school in January and I'm still doing a student loan from when she was doing it before.

I know I'm enabling it and I don't know how to stop and I don't want them living on the street. I can go on for days Let me help you if they're 31 and they're on the streets. It's their choice. I Know not yours and it and I don't know what's hard It's you don't want them to be that way. I don't want that way either honey Well, and he has some I mean from what you outlined is he taking care of himself Like no medically care of himself medically though, I take medication all of it for medically? No, he does not take care of himself. Medically though? Like take medication all of it for bipolar? Like is he... He'll start it and he doesn't take it. Does he live in your house? He does not because that would cause conflict and

I don't... I put him in an apartment. He had a beautiful apartment and I took him out of the beautiful apartment and I put him in a crap hole. It's literally a crap hole. Banking he'll win. He'll go, there's a chance he can afford that. The, um, the, it's still 1200.

It's still 1200. I'm still helping pay for it. So what you have to ask yourself is 10 years from today, what is best for him? What is best for your daughter? What is the most loving act you can give them? I'll answer that for you. Please do. That they have the dignity of having stood on their own two feet like adults. Okay. You are taking their dignity away from them. I'm writing. And I have screamed, cried, prayed. God thinks I'm just being funny now.

100% of enablers are sweet people. You are a sweet person. You are devastating your children. You're hurting them. I teach. I know better. I know how to make my children at school, you know, problems off. If you get it through your head that you're harming them, you'll quit doing it.

Okay. You've got to actually accept the reality that you're harming them. Okay. And once you do that, you'll quit doing it. You wouldn't ever give a drunk a drink. You wouldn't ever give a bag of heroin to a heroin addict. You would never do that. You're too sweet a person. Right? Yes. Absolutely. You're bringing harm to them. Yeah. But I will say there's a level of complication and complexity from what you kind of just outlined. That he has some, he has issues. I mean, he spent time in a mental facility.

He has mental health. How long ago? So. How long ago? Oh God, so that's been a good five years ago. Yeah. Okay. And they both have this, you know, this abusive father thing going on, but I can't get rid of it.

You know, I'm like, let it go, let it go. We'll go see a therapist. Yeah. The thing is this, okay? Wait, try that. I'm not suggesting that you're mean, spirited, or even that you just announce suddenly in a fit of anger that I'm done, I've had it.

That's not what we're suggesting. I've done that too. But I would say that I'm going to look at this young man at Christmas and say- And daughter. And daughter, and say, okay, I can do 60 more days of this. And so I'm making that number up. You can decide whether you want to do 30 days or 60 days. You can't go longer than 60. I won't let you. All

right. Okay. But I'm going to support and I'm going to give you some help for the next 60 days. This is your warning. So you need to ramp up to get ready to receive zero as of February, as of March 1, the end of February. Okay. And you tell them that they're in Christmas here and you say, I love you. And I'm really so sorry that I have mishandled my relationship with you because it's kept you from going and being all that you want to be. And I'm going to be so proud of you when you go and be all that you're supposed to

be, and I'll be cheering for you and I'll be here and I'll be here to cry with you and also Teresa yeah and Teresa you just know you're not in a place to be able to help someone financially you're in baby step two you're broke you have debt right I'm like so that's I mean that's part of the equation I mean honestly and I think you know maybe there's other options if you were on the other side of all of this financially of things of like okay, but you don't have money to help them. If you were a multi-millionaire I would tell you exactly the same thing though. But you can say hey mom's broke and part of the reason I'm broke is I've been supporting these adult children which is an actual oxymoron. This is a weird phrase we use adult children. What does that mean even? But the yeah I'm not able to do it anymore and I'm not going to do it anymore because I've come to realize that I'm bringing you harm when I'm doing that. And so the good news is I'm

giving you a little warning. The bad news is as of March 1 you will receive 0 from me going forward Except my love my prayers and my cheerleading But there will be no more money after this date and you set the date and Make it very clear don't hedge around it and don't go well if you think no shut up Very clear. This is the date it's a contract and then follow it up with an email just reminding you what I told you over Christmas I love you I'm cheering for you I'll be here for you if you need a meal come over I'll feed you dinner but there'll be no more money after

March 1 I'm broke and I'm having to clean up my mess and I'm cheering for you to go be your best self. Okay. Okay. Are you gonna do that because you love them so much you're gonna make them have their own dignity? I love you so much I'm gonna do that for everybody. You're sweet. You are the sweetest lady. All the enablers are the nicest people. But it's so, I mean Teresa, seriously though, as a mom, it's devastating. That would be so difficult if you really did believe, if I'm not helping my child, they're going to be on the street. If you don't believe that you're bringing them harm, you're not facing reality.

I know, but man. Because it's not a sustainable life to live without dignity. I hear ya, I know, but it's just hard. And without work ethic. I'm just empathizing with Theresa, it's hard. That's why you bought your own milk shortly after getting out from under my control.

I don't buy stuff anymore. You're gonna make your own. Oh, I know. Make your own way, little pig. I know. Make your own way. There's a big bad wolf out there, be careful. Make your own way, I'll be cheering for you.

Hey guys, I've never done this before but I'm partnering with a nutrition company Field of Greens. Each fruit and vegetable in Field of Greens is selected by doctors to support heart, liver, and kidney health plus metabolism for healthy weight. And your doctor will notice your improved health or field of greens will give you your money back i can get behind a promise like that go to field of greens dot com slash ramsey and get 15 off with promo code ramsey field of greens dot com slash ramsey hey guys dave ramsey here and i got a big announcement i'm coming to a city near you live on the money and relationships tour with dr. John Deloney this is the most

interactive event we've ever done you get to decide what we talk about you do not want to miss this we'll be coming to Louisville Durham Atlanta Phoenix Fort Worth and Kansas City in April and May of 2025. Get your tickets and more information at ramsesolutions.com slash tour. Rachel Cruz Ramsey personality is my co-host the Ramsey show question of the day is brought to you by why refi if you've made student loan mistakes with zeros on the end well we're not judging you but we are saying it's up to you to do something about it. Contact YREFY. They were created specifically for people with defaulted private student loans, not government loans. If that's you,

go to YREFY.com slash Ramsey. That's the letter Y, R-E-F-Y dot com slash Ramsey might not be available in all states. Today's question comes from Daniel in Alaska. I tithe and donate extra to the church where my family and I attend our donations this year will be around $20,000 in tithes and offerings. The church is not registered as a nonprofit organization. Should I keep donating big sun sums to them? We still want to give our tithes even though we don't get a 503 nonprofit letter,

but we are hesitant in donating more because we're afraid we won't be able to claim it on our taxes. Churches don't have to be 501c3s to be deductible. It's not required by the code. The RS code does not require that. They have to be formed as a religious organization. They can't be involved in politics and They can't be running a for-profit under the same roof Of some kind but if they're operating as a true a true standalone church and their job is to minister to the flock and Take care of the widows and orphans to serve the community as a typical church would You are fine. They're there. Yeah, they're fine. The IRS does not require them to be a 501c3.

But he says, yeah, but I'm afraid we won't be able to claim it in our taxes. You can. You can. It's deductible. Oh, okay. The IRS does not require that they be a 501c3 deductible. Oh, I'm sorry. Okay, I hear you. It's not required. And also, I don't know, to me, the giving like Giving out of your hearts, you know desires and what you want and the tax write-off is just like an added Great thing, but that's not the main motivator

I would not give to somewhere because you don't get a tax deduction exactly that feels weird exactly Now I will ask this question though Daniel most churches and we've had financial peace University taught in 50,000 churches in North America. So we interface with the church community all the time. We're a huge supporter of the Bride of Christ. We love the church. And most churches go ahead and apply for and get their 501c3 just so there's no question

by anyone about what's going on over here. And so maybe it's a startup, maybe it's a church plant and they're early in the process, but I would want to ask leadership why they haven't gone ahead and applied for. Because getting a 501c3 certificate when you're a church is really not much of an effort. I'm curious why they wouldn't do that and I would ask them that but I wouldn't not give and I would not worry about whether everything's a deduction. Now if they're running a political action committee out of the back back there, out of the back room, yeah you could lose your deduction there. That's one of the guidelines. But if they're

running an actual church, then you know, you're not going to have any trouble with the tax issue. But I still would ask the question, why not? I don't understand. I can't think of a biblical reason to not do the paperwork. It would be like, like okay we have a church building but we didn't buy in fire insurance on it well why well we're trusting Jesus uh Jesus sent the insurance guy there so you probably ought to buy insurance on your building I mean that's like call clients it's in second hesitations so I mean not even using that joke for 30 years I know it just keeps giving it's the dad patience. So I mean, uh, no, I mean, he's been using that joke for 30 years. I know it just keeps giving us the dad jokes that just keep working.

So that's as long as they keep working. My ratings don't go down. That's good. Um, the, yeah, that, that, yeah, I, I would get insurance on my building and I would get a five, I was on one C three if I was the pastor of a church, if I was on the leadership team, the church asking why would be good, just be out of curiosity, but also don't be giving just to get the tax deduction. Exactly. But you can get the tax deduction according to you.

And 100%. Yeah. You can ask Papa Google, he'll tell you. It's right there. It's right, pop right up. Hey, I'll answer your question for you. All right, Pierre is in New York City. Hi Pierre, welcome to the Ramsey Show. Hi Dave, hi Rachel, how are you guys? Better than we deserve.

What's up in your world? None much, just wanted some financial advice. I'm kind of in a unique, unique for me at least, position. I'm thinking about, well I'm thinking about maybe buying an apartment, an investment property for $200,000. And I kind of just want you guys' advice if I'm ready for it, not ready for it, or maybe actually just put on the back burner. Okay. Are you out of debt and are you going to pay cash for the apartment? So, sorry, I should tell you my

situation. So currently I have two jobs, my income, I have about three incomes. My salary is about 200,000 more or less and I also the house that I currently live in I make about three three thousand dollars comes in in total my only debt is my mortgage and a my wife's car which is about 25,000 okay all right well Pierre I'm I own a bunch of real estate I love real estate Rachel's husband is in the real estate business he owns a

bunch they own a bunch of real estate and we both these families sitting here love real estate as an investment The rule we live by is we pay cash for it Or we don't buy it and we only start buying investment real estate after we're 100% debt-free home and everything That's the rule we live by but having done that you will thoroughly love the real estate business when you get into it. It sounds like you want to do it. But if you buy this apartment right now, it's probably going to cause you financial problems,

not blessings. Because you're broke. You've got a freaking car payment. You don't go buy a $200,000 rental property. So I could pay a little more in my situation. I understand it. A little more situation. I have $50 little more in my situation. I understand it. A little more situation. I have 50k in the bank.

Then write a check and pay off your card today. Understood, understood. I could do that. Yeah, you should do that. I also had another question for you also. So I was thinking of saving up to a hundred K and actually pulling a HELOC on my house. I know you're really against it but I feel like it would be a lot easier to pull the HELOC out the house how I have an income comp. Well I have money coming in from the rental of my primary residence. Pierre are you 24? I'm actually 32. 32 okay because you sound like I

sounded when I was 24. I used to say stuff like that when I was broke and it made me broker okay because here's what you're not anticipating. You're not anticipating all the things that are going to go wrong when you're on a rental property and the renters that don't pay and now you got a HELOC on your house and now you have to come home and tell your wife we're losing the house because the apartment deal went sideways and we're getting foreclosed on. You don't want to have that conversation. I'm so stupid I had that conversation when I was your age and you don't want to have that conversation. You want to do this debt-free but you're going to go

ahead and do it. So I hope it works out for you. I don't think it's going to and you asked me so I told you the truth because I love you. I don't think you should do this. I think it's a really really bad idea but I don't think I can stop you. I think you're a really, really bad idea. But I don't think I can stop you. I think you're going to go learn the lesson the hard way. Some of us are knuckleheads and it's just how it works. We have to get bonked on the head to catch it. Pierre might be listening and might be reconsidering. He's not.

We don't know. He's not. Because I think what's difficult is in the present, all of that sounds good, right? Like you you can line it up a situation and say oh if this hits in there and I have that in the carpet You know that it's all working all these moving pieces and here's the problem to Pierre when you start Leveraging yourself like that statistics show us and studies are showing us that stress goes up anxiety goes up lack of sleep starts to occur. And you're trading your peace of mind

for complications of trying to build wealth. And you're doing it in a really fast way and in an effective way, because it's gonna cause other issues in other parts of your life. So be as peaceful as possible, pay off the car, work and pay down your mortgage, and then say, hey, let's save up and buy.

And in 10 years, you know, five, 10, 15 years, you guys could be wheeling and dealing and it's all your money and with a lot of peace. So just do it the right way. Everything you're talking about can be done. Just slow it down and do it with cash instead. The best way to get rich quick, get rich slow. This is the Ramsey show.

What does the future hold for business? Ask nine experts and you'll get 10 different answers, economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 40,000 businesses have future-proofed themselves with NetSuite by Oracle, the number one cloud enterprise resource planning system. Ramsey Solutions uses NetSuite and you should too.

Whether your company's earning millions or even hundreds of millions, NetSuite and you should too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities. With one unified business management suite there's only one source of truth for the visibility and control you need to make quick decisions. NetSuite's real-time insights and forecasting help you see into the future with actionable data. And when you're closing the books in days not weeks, you can spend less time looking backward and more time focusing on what's next. And speaking of what's next, download the CFO's guide to AI and machine learning at netsuite.com slash Ramsey.

It's free at netsuite.com slash Ramsey. Hey, if you're like me, this time of year feels bananas. Thanksgiving just flies by and then you blink and the kids are out of school, family's in town, and somehow there's glitter everywhere. Pure chaos. Let's face it, the last thing you need right now is money stress. If you want to lighten your mental load this year, do yourself a favor and go download EveryDollar.

It's my favorite budgeting app and it can help you create a game plan for your spending so you can focus on what really matters this time of year. Listen, the holiday season is going to be busy. There's no getting around that. But let's be busy enjoying our families instead of stressing out about money. Head over to the App Store and download every dollar right now to get started for free. Rachel Cruz, Ramsey Personality is my co-host today, my daughter. One of our favorite things in the world to do is talk to one of you when you're doing

your debt-free scream because you paid a price to win. You've lived like no one else and now you're ready to live and give like no one else we even put a debt-free scream stage in the lobby of Ramsey Solutions and people come by and watch this show and then they sign up and do a debt-free scream on the debt-free stage and our favorite of all is one of our when one of our own Ramsey family, Ramsey team members has become debt free and they are on the stage and that would be true of Matt Hudson and his wife Terry. Matt congratulations, you did it. Thanks Steve.

Well done Terry, way to go. Thank you. Wow, so Matt is a software engineer with us have been with us 12 years yeah I know I was like I know Matt's been here I was like it's it been over 10 years and yeah 12 years 12 years and in the in the Ramsey in the financial piece area Ramsey plus working with every dollar and working with financial piece and all that so you've seen a lot here over that 12 years, how much debt have y'all paid off? So this was our mortgage and so. Woo hoo hoo!

It's 133,000. Way to go! Oh my gosh. How long did this take total? 11 years and three months. Okay. So great. So after you came here.

Yeah. Right after you came here, you got the mortgage and you said, all right, we're doing this. Yeah, so our oldest son is 11 and so for the first year I was here, we were both working and we didn't have kids yet, so we saved up a really nice big down payment, got our house with a 15 year mortgage,

and Terri quit work after Everett was born, because it was a priority for her to stay at home when they were little. And in the past few years then, with her being able to go back and work part-time then we've made some really good progress to be able to get it knocked out early. Way to go. What's the house worth? It's worth $4.45. I love it. I love it. Well, I'm not going to go into your personal stuff since half the Ramsey team is standing around and I'll tell your business in front of your co-workers,

that would be unfair. So I won't ask what your income is or what you have in your 401k that we have here but you guys ought to be approaching millionaire and I'm proud of you as soon as you get there I love having millionaires work on our team so and that's the most beautiful thing I can think I've ever heard way to go you guys thank you so very very proud of you congratulations so working at Ramsey is weird to start with because we're a weird bunch but paying off debt while you're working here it's like peer pressure to do it isn't it? Yeah. He says

it's a good thing he works here because he's the spender. Which is true. Okay so you're are you are you spend money on gadgets? Just kind of, yeah. You're a software engineer, so I'm guessing, yeah. Yeah, gadgets, I just have a, like you pick an expensive hobby, I'm probably into it. Okay, all right, all right. And Terry, but you use the coworkers here and you to rein them in then. In the budget meeting, it's a good thing

for both of us to get on the same page. So that's been a big key for us is to have that monthly conversation to make sure we're both working towards the same things and have our priorities together. Yeah, that's a big deal. Well done, y'all, I'm so proud of you. That's a big deal.

I mean, to have no mortgage. Paid for half a million dollar house. It's amazing. How old are you two? I'm 42. I'm 47. Wow, very cool. Our goal was by 50, so we're glad we beat that.

You did it, you did it. You slid in under the bar. Okay, very cool. Our goal was by 50, so we're glad we beat that. You did it, you did it. You slid in under the bar. Okay, so tell me, because when people are on the ladder baby steps, you know, when they're in four, five, six, a question we get a lot is, okay, so how much should we be throwing extra at the mortgage to pay it off faster?

So just like walk through high level, how you guys decided month to month, or season, maybe it's season by season, year to year. Like how, well, what did that look like a putting extra? Was there sometimes that it was like, no, we didn't because we were saving for a vacation, where there's some times that you're like, all the extra goes on. Like, what did that look like for you guys? Um, my youngest started kindergarten the year of 2020.

So I was planning to go back to work when he started kindergarten, but with COVID being so unpredictable, I was like, let's just hold off. So I started working part-time in 2021 and we had decided that all of my paycheck would go to house payoffs. So we lived off of what Matt made and hit our savings goals with that

for like vehicle replacement and stuff like that. But all of my paycheck went to house payoffs. Okay, so great. Are you still gonna continue to work part-time? Or now that the- Yeah, we've got some other goals. We wanna do some house renovations, some vacation, and of course, like college funding. So yeah, yeah, yeah, that's awesome.

So what are you gonna do with the house? We wanna get some new floors. We wanna update the living room. We really haven't done much to upkeep the house since we bought it. So we just kinda wanna make it prettier. Yeah, there's a lot of things we put off because it's like, well, we're almost,

we almost have the house paid off. And once we get that done, it'll, Yeah, there's a lot of things we put off because it's like, well, we're almost, we almost have the house paid off. And once we get that done, it'll. Well, you got no payment now. Yeah, you got all this room. Yeah, yeah, but they're fast. Putting new flooring in, it goes a lot quicker when you don't have a mortgage.

So totally. It's so great, you guys. Amazing, amazing. So how does it feel when you guys paid it off and you like sent it, you know, what was that like? It was amazing. We were at Chase like five minutes before they opened and we're taking pictures outside of Chase

and then the employee saw us and he's like, are you Terry and Matt? Come on in. And so he told us the payoff balance and wrote the check and we're just sitting there like, we just did it. We did it. Oh. Ha ha ha ha, love it.

Woo, and go to the parking lot, do a little dance. Yes. I like it. Very well done. Well done parking lot, do a little dance. Yes. I like it. Very well done. Well done, you guys. All right, working here, does that make it harder or easier, seriously? I think it made it easier,

because it's just like you said, you have kind of that positive peer pressure. It's not weird that we were not borrowing money and that we were paying extra on the mortgage and that kind of thing. It was just, I don't know, I'm not. You have the benefit of your coworkers not making fun of you.

Yeah. That's an interesting thing to have, yeah. And quite the opposite, they might be making fun of you if you weren't doing this, but yeah. Yeah, like we're just doing, handling money weird, and everybody else is doing the same thing, so it's not like you're an oddball around the people you work with doing it.

Well obviously you don't have to work at Ramsey to do this. Millions and millions of people have. We've got tens of thousands of debt-free screams on the YouTube channel that people can watch of people from all incomes and areas of the country and situations have overcome all kinds of things but what would you tell folks that are listening and watching the main thing? From your perspective Terry that you have to do if you want to get out of debt What is the key to getting out of debt? I think it's having the budget and making sure that everyone's on the same page and that you're working towards the same goal

And then also to like daydream about what happens after that helps you stay focused because like for us it was 11 years, which felt like forever. And we had to keep up with our dreams. So focusing on that after the house pay off too. Hey, when you mapped it out the first time, what was your prediction of how long it was gonna take? We thought we would be done by the time our oldest entered high school, and he's in sixth grade.

So we got done about three or four years early. You thought it was gonna be 15 years and it was 11. Yeah. Yeah. Yeah. Okay. Most people bring it in earlier than they originally planned. Yes. Yeah. That's not unusual at all. Good job, you guys.

Very proud of y'all. Great job. All right, bring the kiddos up. Everett and Spencer are with us. Good looking young men. And so who's who and what's the ages? This is Everett, he's 11. And this is Spencer, he's nine.

Okay, so Everett came the year we bought the house and now he lives in a debt free house because his mom and dad are heroes. Way to go you guys, we're very proud of y'all. It's so good to see you guys too, I feel like Terry I just see you at Christmas parties every year. So it's good to see you outside of it

and I'm so happy for y'all. Thank you guys. So excited. All right, Everett and Spencer, you guys been practicing debt free scream? You know how to do it? All right, better get ready, man. Cause this is your minute.

This is your moment right here. You're gonna be famous in just a second. Matt and Terry, Everett and Spencer. Matt Hudson from the Ramsey team. For 12 years he's been with us. They paid off the house in 11 years and three months. $133,000, house and everything. They're weird, they're heroes.

Count it down, let's hear a debt free scream. Three, two, one. We're debt free! Whoa! Woo hoo Woohoo! Way to go you guys! Like any good software engineer, he's very precise. And they had a plan and they executed it early.

Yep. Wow. Knew what they wanted, it's incredible. Absolutely incredible. I mean, have a paid-off house. Like that's just I mean it's crazy. Crazy crazy. It's when normal is broke in America your goal is to be weird. So one of the best compliments you can hear around the Ramsey show is if we call you a weirdo it's because you're doing very smart things in a culture that has nothing smart to do.

This is The Ramsey Show. Hey, listen up, guys. Black Friday deals start right now. Yep, you heard that right. You don't have to wait until Black Friday or even leave the house to get great deals on our most popular gifts. You can get our best selling hardcover books for just $12 and audiobooks for just eight. Give like no one else this season with gifts that actually mean something to your loved ones.

Go to RamseySolutions.com store to shop the deals today. That's RamseySolutions.com store. Rachel Cruz, Ramsey Personality is my co-host. Thank you for joining us, America. It's a free call if you want to call anywhere in North America. This is the last segment that you'll be hearing on the podcast. The next segment of the show is on the Ramsey app.

The third segment is always on the Ramsey app every day. Ramsey Network app is a free download and if you want to go further with Ramsey there you can have calls that are picked for you. You can filter by topic. You can always get the third segment of the show and you can send us emails. You can do all kinds of stuff. So download the Ramsey Network app. It's completely free and it's a way to get access to things earlier and really for you to control your listening environment a little more than you can on the normal podcast or YouTube broadcast or talk radio. Talk radio stays exactly the same. It's what you've always gotten. You're always going to get exactly that as long as your local

station carries us there and that's perfect and we're glad they are. Ramsey's Black Friday sale is going on right now get early access to some of our best deals, meaningful gifts for family and friends as low as eight dollars. You can shop our best-selling books like The Total Money Makeover, Baby Steps Millionaires, Own Your Past, Change Your Future for just twelve dollars. Audio books and ebooks are only eight dollars. The Rachel Cruz wallet in Black, Camel, Brown and Champagne are on sale this week. Questions for Humans conversation cards starting at just $12. The Black Friday sale also includes the brand new Rachel Cruz children's book.

I'm glad when I can share. And the previous three books are available. You can get the three book set. It is a trilogy. This is the last one. And you get the previous three books are available. You can get the three-book set. It is a trilogy. This is the last one and you get the whole three-book set on sale right now. So if you got grandbabies or babies and you need bedtime stories, that's the best. It's all there at ramsysolutions.com slash store and even more. Eric is with us in Key West, Florida. Hi Eric, welcome to the Ramsey Show. How you doing today sir? Better than I deserve. What's up? Yeah so like many investors I pay my financial advisor an assets under management fee. In my case it's 1%. My wife and I've been married for 20-ish years and over the time we've built our

assets under management to about half a million dollars, we have other assets, but under management from them, about half a million dollars. That would be five thousand dollars a year for their fees. A couple years ago, my parents passed away and we inherited a substantial sum. So now our assets under management are a little over two million. My questions are, you know, or my problems are two. First, you know, by doing nothing extra, no effort on their part, suddenly my advisor has gone from $5,000 a year to $20-some thousand a year for doing the same work. The other thought is, you know, when it was $5,000 a year, you know, I could stomach that. Now I'm thinking over the next 20 years,

even if my assets remain flat, that's, you know, 400,000 and if they go up plus lost investment opportunities, that could be 500, 600, $700,000 that I'm losing. So are there any alternatives to assets under management fees? Are there any recommendations you can make? That's a very standard way of running a brokerage, I mean an advisory company right now. Most of our Smart

Vestor Pros run a very similar fee base. I have seen some of them, the fee decreases as the assets on percentage decreases as the assets under manage increase and so when you've got a portfolio the size of yours it probably could be less than 1% I some keep it there and then the question you've got to say is okay what am i getting for this money and you know I'm a firm believer in having an advisor I'm like you though I want to know what I'm getting for what I spend and so I think I have a conversation with them about two things one is tell me exactly what you told me guys this is a lot of money and I'm not sure what I'm getting for my $25,000 a year.

Show me what's... Because I can buy a nice car once a year for what I'm paying you all, okay? And have a whole basement full of cars, right? And so in a couple of years. So I mean, what is it I'm getting for what I'm paying you and show me your value? And or do you have any kind of a sliding scale now that this has gotten so much more? Like a lot of times when it's over a million dollars you start to see things slide down. Do you have anything that you run a less percentage on on a portfolio this size. Ask them

that question. Those two questions. One is show me why, you know, make the sale again. Why do I, I mean I'm not mad at you, but show me. Right now I'm confused, disillusioned about what I'm getting for 25 grand a year. The effort hasn't changed, or for the process the strategy hasn't changed It's the same thing right then the third thing I would do is jump on Ramsey solutions calm and click SmartVestor Pro and talk to some of our smart investors. They're in the exact same business They run the exact same most of them run a management fee like that You know, it's usually the you know, it's very standard in the business. The industry runs about 1%. Some people do three quarter, some do a sliding scale.

When you got more assets under management, some don't. But I mean, they're not ripping you off. I don't think that at all. But you're asking a valid question that you deserve an answer to. And it is enough money that it's fair to ask the question. So I would ask the smart vestor pros, ask any of them, do you have a sliding scale when a portfolio gets to this size? I got about

two and a half million. I'm really concerned that I'm paying a 1% fee on that because I don't know what I'm getting for that. And it's not a belligerent thing. There's no belligerence in your voice, by the way. Okay. You're not being a jerk about it. You're just going, okay, I'm sorry. And I probably wouldn't use the phrase, you're doing no more work. That's a bit insulting. But I would say, you know, what am I getting for what I'm paying you? Why would I do this? And what's going on here? I mean, because I do value what they do. And I think you should, Eric. I think you ought to have someone in your corner

to talk to. Rachel has a SmartVestor Pro. She and Winston meet with. I have one that Sharon and I meet with. And they don't, in my case, they do less than they might for Rachel and Winston because we do all our own estate planning off to the side and we do all of our own, for and Winston because we do all our own estate planning off to the side and we do all of our own, for that matter,

all my own selections on the mutual funds. Yeah, what I have found, Eric, the value for us is that they're looking at more than just investments. I mean, ours are looking, they're looking at taxes and like if there's like real estate involved that you can sell within this five-year period and get this, I mean, like they're kind of strategizing with you, I mean everything from our giving to investing,

I mean they're looking at the whole thing and that's always helpful. But my question Dave to you, is there ever a point from like Eric's perspective, which I know is not a lot of people out there to have this substantial amount of money, just investments, that you would ever pull a million out and do your own and put in an index funds and keep a million in. Do you know what I mean? Like spread out where

you're not, it's not all under someone's. No, I would get, I would get happy where I am. Yeah. And if I can't get happy there, I'm gonna get happy somewhere else. I want somebody in my corner and I want it all in one place invested in different things, but under one set of eyes, there's no advantage to diversifying your advice. No, I think that's just bifurcating your brain. Well, not your advice, but would you ever just individually go open up a Vanguard and just put your own money in for the S&P or something?

Do you know what I mean? I mean, the only thing I do there is I do have an S&P that is independent of these guys, but that's just me throwing money in there, extra money laying around until I get some money for a piece Of real estate that they don't have anything to do with and you're gonna go buy it So I'm gonna buy it out of that S&P. I don't I don't invest in the S&P. I park in the S&P. So Which last year was a really good thing. It made 30% but Not a bad parking spot, but the Yeah, so that that's yeah, it's

spot but the yeah so that that's yeah it's three different investing it's like I'm not gonna go to three different churches because I sort of agree with them you know no it's not you need to find a home and deal with the discomfort of the home and the comfort of the home yeah that's good yeah that's that's what I would do it's a good question it's an excellent observation Eric you're not asking the wrong question you're asking that's what I would do. It's a good question. It's an excellent observation Eric You're not asking the wrong question. You're asking the right question. I would just ask it carefully and Somewhat humbly but but it's a fair question that I'm gonna dig to the bottom of so three things one is Shop around go talk to some other smart Vestor pros See if they have a sliding scale ask your guy if he's got a sliding scale and ask your guy why he's worth 25 grand a year what is he what am

I getting for that that's a all fair questions and should be asked that you managing your money and that's as it should be well done sir very well done this is the Ramsey Show. Hey, you're still here? What are you doing? You do know that the rest of today's show is playing right now over on the Ramsey Network app, right? All you gotta do to finish the episode is search Ramsey Network in the App Store, Google Play Store, or just click the link in the show notes to download the app for free. Yep, you heard me right, for free. Then right there on the

home screen, you can watch the rest of today's show. Ba da bing, ba da boom. Alright, I'm getting out of here. Enjoy. We'll see you on the app.