Transcript of Don't Let People's Opinions Influence Your Financial Decisions New

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Normal is broke. And common sense is weird. So we're here to help you transform your life. From the Ramsey Network in the Fairwinds Credit Union studio, this is The Ramsey Show. And I'm Rachel Cruze hosting this hour with Dr. John Delony. So give us a call at 888-825-5225. Talk about your life and your money and your relationships. We are here for you. The phone lines are open. All right, kicking us off this hour is Grace in Boston. Hey Grace, welcome to the show.

Hi, thank you so much for having me. I really appreciate it.

Absolutely. How can we help today?

Um, so basically this is kind of a real mess. I'm drowning. So I'm drowning in a lack of transparency over the course of the past 3 years. We sold our house 3 years ago in 2023 when I was expecting our 5th child.

Okay.

Bottom line is, um, we had to move because we had real difficulty in Massachusetts finding a, an education that wasn't completely crazy. We were pretty conservative and I just found the state incredibly difficult to navigate. So, we moved closer to the kids' school, but in the process, we never had a contingency and we just sold our house without having a place to move into. Long story short, we moved into my childhood home, which was sitting empty, luckily. And we sold our house and made $700,000 off of it in 2023. And I moved half of that money over to a kind of secondary house that we purchased. And so we were left with $325,000, of which we spent. My husband borrowed $50,000 from me in 2024. In 2024, I also borrowed about $75,000 from my family, my, my mother. And then in 2025, last year, I asked for an early inheritance and received an early inheritance. Because my husband said that we were going to— we were looking for a house. We were actively for the past 2 years looking for a house. So unfortunately, when we sold our house, there was a delay on the other party's end for closing.

So it went from 30 days to 90 days, and in that time, the interest rate really went up. So we kind of got— our intention to buy a house really got thwarted. And in that time period, I don't know if my husband was making any money because we seem to have gone through considerable amount of money kind of just waiting to buy a house. And so I needed a little bit more money to put down as a down payment, asked for $240,000. That was last June, and since then have gone through it.

Where— but it didn't go through to a down payment, correct?

No, it did not. It went to now, just since June, so about 11 months ago, just daily living. So As I said, we're in a very expensive state, Massachusetts. I was paying for a ton of healthcare costs. So, one of my children is sick. I was paying for just, you know, different medications out of pocket. In January, I kind of woke up and said, "Do we not have healthcare?" And my husband said, "You're using the wrong pharmacy." And then in February, I said, "Do we not have healthcare?" And he said, "Yeah, I don't—" I don't know if we do. So I immediately went on MassHealth. And since February, I have told my husband to leave until he can find a job. So he owns his own company, was telling me for the past 3 years since we sold our house he was making $30,000 a month. And we were in good shape. And he was managing everything. And then I pushed and pushed and pushed since December to find out some transparency around some issues and kind of threatened to hire a financial planner, which he was not, uh, into. And I then said a lawyer for some transparency, and he said he'd show me the loans.

He showed me the loans, and then finally, uh, 2 months later, I found out just last week that he's— he took out $650,000 in loans. Oh my gosh, $450,000 are personal, $200,000 are business, all since 2021, none of which I've known about. So obviously, where did that $450,000 go? I have no idea. I, I— so he said that he's made a dent and he's managing the debt. And I said, can I see the whole profile, how much you actually took out? And that's when he said— he showed me it was $650,000. He's paid in the past few years $200,000 towards that.

You guys are almost a million dollars in just consumer debt from loans.

True. Okay. Okay.

So, but this is all new to me. This is all extremely new.

I know. Grace, this is all new to you and your husband borrowed more than half a million dollars, lied to you about it and all that's true.

Okay. 100%. And you borrowed $240,000. Well, I guess from a, you got it from the inheritance.

Yeah. Yeah. I mean, yeah. Not to pay back.

But, but here, here's what I wanna point out. Like you, you, you have, your mess is very much financial, no question, but your mess is much deeper. Than owing a million dollars, right?

You mean it's the lack of communication?

Meaning like the moment your husband took out a $50,000 loan from his wife, you stopped being his wife, you became his banker, right? And you became his— his— like the whole dynamic here is such a mess.

Right. Can I just— can I just add one thing? You're right. When we— when he asked for me that $50,000, it was literally one week after we moved all of our stuff into a rental while we were waiting. He said, let's just rent a place until we can find a place. And—

but the language you used was he borrowed $50,000 from me. Yeah. And you're— yeah, he borrowed it.

He said, I'll pay you right back. I'm just—

that's what John said.

That's what I'm saying. I would never— I can't ever imagine asking my wife to borrow money because it's all ours. Mm-hmm. Right. And if, if, if she's gonna say, hey, we're so broke, I need to go ask for an early inheritance, like Old Testament style, I, I would, we, we have to sit down. We, we would talk about that and we would make plans for what we're gonna do next. Mm-hmm. And we're not perfect, don't get me wrong, but that's what I'm saying. Like, you, you're running two concurrent businesses inside your house. You're both spending out of control. And you're both getting money from different places, sometimes telling the other person, sometimes not. His, his hole he's dug is way deeper than the one you dug, but y'all are both digging your own holes. Mm-hmm. Right. So like, you've got a huge mess. How can we help?

Uh, right. So, well, I mean, I'm fortunate to have the house that I grew up in and that's where we're living. Okay.

But why, why, where did the rental go? Do you say there was something about a rental?

Like you rented and you bought another house? Like, what are y'all doing?

Yeah, correct. He told me we haven't found a house. This was back in 2024. We haven't had found a house yet, so let's just rent a place.

But you were already in a home, right?

You were in your childhood home, right?

Yeah, but he just, you know, I didn't, I didn't know the financial mess we were in, and he said, I know you don't want to live there, so, you know, it's okay.

So you're not in your childhood home right now, you're in a rental?

We are back. That was 2024, now it's 2025, '26. We're in my childhood home.

Okay. Yeah, you, so you're a rental. Okay. And your rental. And you had $250,000 that you took from— Correct. And then where, where is, you said we went to buy another property with that $250,000.

Where did that go? No, we, we, I just, we lived on it the past 10 months.

You know what, Grace, we're, we have to head into a break. I wanna keep you on the line. Yes. Because I do wanna kind of untangle some of this to really help you. Because I, we wanna be able to give you— Yeah, go ahead. A plan. So, stay on the line and we will, yeah, we'll come back after this break to break down a little bit more of the financials to get you guys on a path. And then definitely the relational side, which Jon can speak into, 'cause I think that that is, there's a gaping hole there and both need to be fixed and talked about and addressed. So we wanna help. Buying a home is one of the biggest financial decisions you'll ever make, but too many people base the decision on opinions or what the market is doing that week.

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All right, we are back, and we're going to go back to Grace, and she's in Boston. And to recap the call, if I can— there was a lot of details. So Grace, if I don't get this correct, I just wanna make sure. Go ahead. You're married. You guys back in 2023 sold a house but didn't have a house. And so there's been a big mix-up within taking money from loans, inheritance. A lot of things have happened even medically this past year. And all in all, close to $1 million in just consumer debt loans. And was kind of where we, ended, I guess, to a degree. Does that all sound pretty correct? Okay, it does.

I, I just want to add a couple of things. Um, factually, he had been divorced, uh, 3 times when I met him. Uh, he had also been bankrupt twice prior to meeting him. And when I met him, he had 4 boys from 2 prior marriages. Okay, so they're grown up. They don't— he doesn't pay alimony or child support at this point in time to that extent. But we've been married for 16 years. So, and we have our own 5 children.

So Grace, let me, can I talk to you directly? But you know that like I'm on your, I'm on your team. Is that cool? Of course. Okay. Um, what you just told me gave me even more fuel to the fire I was feeling during the break. You married a guy that has been a financial disaster, right? He's really struggled. He also had kids from multiple marriage. Like you, you knew who you were signing up to do life with. And yet you have continued. And by the way, he's not on the phone, so I can only talk to you. You have continually said, well, whatever, I trust you. You said this. And so I want you to also hold some of the response, a huge half of the responsibility here in that I didn't ask questions. I, I started spending money. I burned through a quarter million dollars in 3 or 4 months. Paying medical expenses without even asking the question, do we have health insurance? That's not his fault. No, no, no.

Right? No, no.

11 months or 11, like whatever, 11 months. That's still a lot of money to just rip through. Right. And not to sit down with my 16-year spouse and say, hey, we have this big thing coming up with our kid. We need to navigate this thing together. Right? Yeah. And so it's, it, there has to be a, not only do you, And now you're threatening him to hire a lawyer. I wanna see transparency. I think the, the only way you, you guys can even have a prayer to make it through the financial mess, much less the relational mess, is that you sit down at the table, both of you, no threats, no, none of that stuff. And both of you say, both of us have contributed to this. I, for a year, had a free house to live in, my childhood home, and I complained about it. Didn't wanna live here. And then he went and rented something. We had no money. And then we did this and we bought this other house, but we're not gonna live there cuz that's our special rental. All both, everything just has to stop. Everything has to stop and say, we have created a mess.

The only way forward is if we get on this, either we divorce because of the financial infidelity, or we have to say we have to live differently starting today. Do you get what I'm saying? Mm-hmm. And if you don't, if you don't feel any shred of ownership over the position you're in, there's no path forward for you. Because you're just gonna walk in and blame and blame and blame and blame. And he's gonna either shut down like he's been doing the last 15 years, or he's gonna head off on a separate path. And so both of you have to sit down and say, we have created a mess. We haven't asked the right questions. We have lied to each other. Or he has to say, I lied to you, whatever. And we have to get to this baseline of the marriage we had is over. Do we wanna build a new one? And here is all of the excavated foundation from the old marriage. We're starting at dirt. Do we want to rebuild a new thing together? You know what I'm saying? Yeah, it's that level.

And I would say on your end, Grace, I mean, tell me what you think of this. Yes, he— Grace, you know, I do. I'm with John. Like, there was a level of responsibility that, yeah, you didn't take, but also he did hide half a million dollars. Yeah. Oh, I mean, yeah, even more. So the trust is broken on both ends, probably. More so, maybe more so on your end. And so learning a path forward to rebuild that trust, cuz the goal will be you guys working together. And if that takes a journey, and probably it's gonna take a lot of therapy and all of that, right? To rebuild that trust. Um, that's okay. That's gonna take time. But the goal by the end of this, when you guys sit down and say and do everything, you know, what Jon was just saying, the end goal is that we are a household and financially, and big decisions and everything that falls in that bucket, we are doing this together. We don't make decisions about money without each other. And I would say even more of a microscope because of his past financially, of how he's act— I mean, of how he's handled money.

He's filed bankruptcy twice. So, even more, even more scrutiny that every purchase, we are gonna be on a communication level that is probably more strict than the average couple out there.

Rachel and I have sat with Dave and Sharon, and Sharon, that was that 30 years ago, was their bankruptcy. And still to this day, Dave and Cheri, they have resources till the end of time. And they still talk about major purchases together because that core seed was planted 30 years ago of, "I didn't know how bad this was." And so, from here on out, we agree that we're gonna talk through these things together.

00:16:14

So, that's the goal for you guys from a marriage perspective, Grace, from our position, like what we see. Is what we want for you all. But financially, how to dig out of this. Um, what are you guys making right now a year? Like, are you working? Is he working? What's going on with income?

Well, see, this is the thing, just to back up, I did not just fall off of a turnip truck. I asked questions. I hired financial advisors. I tried to do a Sunday night meeting with him every week, and he'd fall asleep. He would say he's too tired, now's not the time. This has been going on for not just 3 years, but 10 years. So we sold 2 houses before that just to kind of make ends meet. So it's, it's been a pattern where he skirts the communication issues. So in terms of me taking ownership of my stuff, yes, I do. And I think that I agree with you, but it's hard to talk to someone who is constantly stating things that are untrue, like he makes $30,000 a month, which maybe that was true during COVID maybe, maybe not right now. Yeah. Yeah. So I don't know, because I asked him, could I get some bank, uh, Can I just see what your, the stream of income is? And he always says it's complicated, or I'm working on the numbers. Okay. Let's move to the jargon.

Let's take it out of money. Let's say that he has a history of cheating on his, on his past wives. And then y'all get together and every week you wanna sit down and talk to him and say, I wanna reestablish trust. Can I see your phone? And he says, absolutely not. And all of a sudden he, you, you see hotel receipts show up at the house and you're like, I didn't stay there. Who was there? And he goes, it's complicated. Would you stand for that? No. No. So what I want you to see is like, when I say responsibility, absolutely, you've been trying for 10 years, panning back. We've been doing the same thing. We've been trying to run the same play for 10 years and it's never worked. Right. That's where the ownership is. I don't want to say this is your fault and you're— I want you to just take ownership. Okay. I've put up with this for 10 years. I'm done putting up with it.

Yeah. And then when it comes to the financial advisor, I've hired a guy, I've hired a woman, and neither person is right. They're always—

yeah. And that's gonna be his— so, Grace, real quick, we have— yeah, we have about a minute and a half, so I want to just real quick— no, you're good. How much are you guys making right now? Do you know what he's making? What are you making?

No idea. No idea what he's making. He said $30,000, he said $20,000, now it's $10,000. It ranges. Okay, you're not potentially sued? Yeah, his company is falling apart right now, so he's getting sued.

So what is under your name from a debt perspective?

Because Right now in my head, you guys are two separate entities and we kind of were like, that doesn't need to be the case. It does need to be the case right now because of everything. You're not safe. But what are you—

I don't have any debt. I don't have any.

But you're, you're, your mom, right? You, you borrowed $75,000 from her at one point. Yeah.

No, I don't have any debt right now. I just have this Cape Cod asset right now that I'm trying to keep. It was gonna be foreclosed on because he wasn't making the payment. I took ownership of it 3 months ago.

Is your name on the deed?

Now it is.

It is now. And how are you— is it paid for?

No. I mean, how are you paying the mortgage?

Like, how are you going to pay the mortgage every month?

I just am tapping into that early inheritance, and I have maybe 4 or 5.

Are you planning on going and making an income?

Um, I make very little money, and I have—

I teach on the side, and then I have some. So, so really, so my advice for you of what I feel like what we I can say right now is yes, keeping everything separate right now. And you have to take care of you, Grace. So yeah, you are probably gonna have to go make an income because this $250, and the way it's been, the pattern in the past, it's gonna be gone in 3 months if you're not careful. And so you need to start getting a job. You need to be doing a budget and you need to be taking care of food, shelter, utilities, transportation. And then the whole mess of the marriage and his finances is gonna have to be untangled. And that's gonna take a while and probably some professional to step in and help.

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Well, I used to be one of those guys. I didn't even think about it, and one of my buddies said, hey, the only The only reason to not have life insurance is if you hate your wife and kids. And I immediately went and got term life insurance. That's a gut punch. And oh, you're telling me. And for decades, Dave, I've sat across people who've lost a spouse, they've lost somebody important to them. Me too. And they don't know what to do next.

Me too. I mean, you're gonna have a crisis here. And you know, you got two options while you're sitting and talking to a young widow. She's concerned about how she's gonna invest all this money properly and not mess this up, or she's concerned how she's gonna eat tomorrow.

That's exactly right. These are the two options.

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Well, it's May, and the Ramsey Cash Giveaway is officially here. So you can enter every day from May 1st through the 31st. There's one grand prize winner who will get $10,000. Plus, there will be one $500 winner every single week in the month of May. And you can enter daily to increase your chances of winning. Plus, be sure to check out our sale that is going on right now and kick off your summer with some assessments and books and all the things for just $12. So, go to ramseysolutions.com/giveaway now to enter. No purchase necessary to win. All right, let's go to Summer in Baltimore. Hi, Summer, welcome to the show. Hi, how are you guys? Hi, we're doing great. How can we help?

Good, so I was wondering, should I accept financial help from my parents for tuition knowing that they're in debt? I am so grateful that they want to help me. I just, I feel so guilty knowing that, accepting that money, knowing that they're in debt. I'm not sure exactly how much debt that they're in, but I know that they have consumer, the house and car loans and things like that.

Okay. Are you, how old are you, Summer? I'm 23. You're 23. So is this your first time entering college? Are you getting a master's? Like what, what are you going after degree-wise?

So I already got, um, my 2-year degree and I cash flowed that. I finished my 3rd year, cash flowed it. So I only have about a year and a half left. Um, I've paid, yeah, I've only, I've paid my tuition so far throughout, but I think the burnout is starting to hit me and they're noticing. So they're getting a little bit more adamant about helping me with school.

Oh my gosh. Well done, Summer. So you've like literally like worked your way through. Yeah. Yeah. That's amazing. And so then you've had conversations with them that it's just kind of tough and they're like, hey, let us help. And what are they saying they wanna help with? Are they wanting to pay for everything outright for the next year and a half or one semester or?

They are wanting to help with half each semester. Okay, okay.

I— so for me, and Rachel, hop in here— for me, Summer, man, I think every friend I have outside of this ecosystem that I— where I work has some sort of consumer debt. Yeah, whether it's a mortgage that they— I've got one friend, I take that back, one friend who's a banker and he just thinks It's dumb to have personal debt. But beyond that, every friend I have, and it's a values judgment, right? They all make great money. They just choose to live their life differently than I do. And so for me, the question would be less about, we have a different value when it comes to having a card loan versus not. And the question I would ask myself as a kid is, are my parents harming them? Are, are they doing something that I know is gonna be detrimental to them? Or do they have a lot of money, they have pretty good money, and also they make car payments every month? [Speaker:KRYSTALINA] Yeah.

So that's where I kind of feel like I get into a rock and a hard place because I know that they're not fully set up for retirement. And that's what gives me a lot of anxiety, accepting that kind of money, knowing that they could be putting that towards their own retirement. But they choose not to. They're still living.

But they haven't chosen to in the past though, right? Yeah, they're not going to. Yeah, that wasn't decided because of you're in college and they wanna help with that and they stopped their retirement to help you. They were never gonna do it in the first place probably. No, no, they weren't.

Yeah. They still don't wanna do it.

I think your heart is great and I would probably feel the same way if I'm like, golly. So I think trusting your gut is what you need, but I also don't wanna put guilt, Jon, you could probably talk more about this than me as the psychologist, but like, don't put someone else's, situation on you. You've not made these decisions for them. They have made them. As your parents, they have offered to help. And I don't know, there's a part of me that I'm like, they're making these decisions. I don't think this would change their decision-making one way or the other. So, it's not like you are adding to this, you know, I don't know, you're stopping some motivation of like going in the right direction. But again, I know you don't wanna keep digging them deeper in it. There's a part of me that would— Accept it. Is that bad, John?

No, I mean, I would take somebody's help. I think the, man, I've mentioned this several times the last few days on the show. A friend of mine, Becky Kennedy, who's a psychologist in New York, she goes by Dr. Becky. She reframed guilt for me. So I'll ask you this question. Is it against your values to accept help? Do you hear me, Summer?

You know, you could out there. Is it against your values to accept help?

Is it against your personal values to accept help, period?

Yeah, it sounded like there was more. There was a question mark. She's like, I think you could have just—

just yes or no. What?

Help with what? Yeah. I guess not. Okay.

Is it against your personal values to pay cash for college? Um, no. Okay. Is it against your personal values to ever accept money from somebody who is in debt?

No.

Okay, so if those are your values, then the thing you're feeling is concern and, and, and frustration with your parents, and you're choosing to take their issues and try to carry them on your own. And if you as a 23-year-old are already doing the math and you're like, they're probably gonna be living with me one day, that might be your reality, right? Mm-hmm. Yeah. Um, and also maybe not, maybe they don't tell you everything. Maybe you don't know they have a pension or what they like, who knows what their situ— full situation is. But if you're not doing anything that violates your own values, and by the way, if it's against your values to ever take a dime from somebody who doesn't, who, who is in debt, then don't take their money, 'cause that would be a violation of your values. You'd feel guilty, 'cause I violated my core values. If it's not, then I would be grateful for the gift and go on about my life. If your gut says, if I take money from them, it's gonna come with a bunch of strings, they're gonna start asking me what my grades are and why, and you've been doing it on your own, you wanna grind it out for 18 more months and be finished, then stay on the path.

Or they expect to be paid back at some point, right? Yeah, they're gonna call you and say, "Hey, where's our money?" Yeah, borrowing money versus it being a true gift would be a—

Yeah, no, not at all.

Yeah, and so, and if you want to sit down and have the conversation as a 23-year-old, I can tell you it's probably not going to go well. But if you say, hey, I would love this gift, I'm concerned about y'all's financial situation.

Yeah, yeah. I'm curious, Summer, how do you know that they're in a bad spot? I mean, I know you mentioned car loans because maybe in passing they talked about it, but how do you know that they're not contributing to retirement or, you know, these kind of things that you've thrown out?

Have they told you or you guys have talked about Um, I'm nosy, so I ask, I ask if they have a Roth IRA separate than their 401(k)s, and, um, they don't really know what it is, things like that. I know that they have 401(k)s with their— with at least my dad does with his work, um, and I've seen it. But again, it's not, um, it's concerning to me for their retirement. I get, I get worried for them because they've worked so hard too, so Yeah. No, absolutely.

And I think one of the best things, you know, and it sounds like you guys have a good relationship that you can at least have somewhat of these conversations. And not that you're gonna try to change them because that does no good of really pretending like you can come in and swoop in and save the day on their financial journey. But I think it would be, you know, fine to continue as much as they wanna open up and talk, maybe not open up about their numbers, but just talk about the idea of money, the philosophy around money. Yeah. You know, those kinds of things. And you know, and bring it up in conversation of like, "Man, debt just seems to bother me. I don't know why. I don't know where that comes from. Like, what do y'all think about it?" You know what I mean? And just have like, just more, you know, a casual conversation with your parents. Because it sounds like you guys can have those. I feel like I have that with my parents. Like, whether it's theology or politics or whatever, you know, we'll throw ideas out about stuff and kind of, you know, just, and talk about it, have different opinions sometimes.

But it's always an interesting conversation. So, I would be curious, you know, what, what things you can bring up or talk about in a casual setting that you can maybe share some of your experience of. I mean, obviously you listen to this show to a degree to call in, of like, "Yeah, I've been listening to this thing," or, "I've seen this and I thought that was fascinating," or like compound interest, "I had no idea, oh my gosh, like look at this calculator on ramseysolutions.com." Like whatever, I don't know what it is, but I am curious if there can just be conversations where you get to share some of the value systems at which you've placed money, which might be different than them. And actually, again, not in a weird teaching way, But open up and talk about it, and they may actually learn something.

Or just something as simple as, "I'm nervous to take this money. I'd rather see y'all invest it for your retirement," and see what they say to that.

Yeah, yeah. So, Summer, you're awesome. We appreciate the call. Yeah, if something goes sideways or crazy, call back on a day Jon's here, and he can help untangle that. Thanks for the call, Summer.

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All right, let's go to Becca in Louisville. Louisville. Louisville. Hey, Becca. Louisville. Welcome to the show.

Hello. How are y'all doing today?

Hi, we're doing great.

How can we help? So my husband and I just got out of debt 2.5 weeks ago. Congratulations, Becca. My car caught on fire yesterday. Thank you. Well done. My car caught on fire yesterday. Of course it did.

It did, cuz why not?

And I was wondering if we should go into debt for a new car.

Of course, yeah, for sure, do that. Stop. No, Becca, Becca. Oh no.

Okay, so what happened to the car? What caused it to catch on fire?

You shouldn't drink gasoline and smoke at the same time.

So actually, I was at my OB appointment because I'm also almost 7 months pregnant with our first baby.

Oh my gosh, man, congratulations.

I went inside and they were in the and they were talking about a car on fire outside. I thought nothing of it. Turns out it was my car. And, um, we think it was a battery short or something like that, but I mean, there's no way to really know for sure when your car catches on fire why it was on fire. But oh my gosh, everyone was okay, and that's good. So that's terrible.

Okay, did insurance like jump in at any point? Like, are you— are you getting any money for this car?

So we don't think so. We only had liability on the car because it wasn't worth very much, and we didn't owe anything on it. Okay, so we're probably not gonna get anything from it, but we do have about $5,000 to spend on a car. Well, beautiful. Okay. And the reason that I'm calling really is I feel like I may be being emotional about getting into debt. My mom, my sister, they're both also Dave Ramsey fans, and they are also debt-free. And I was just thinking, like, they were saying, well, Becca, you know, you're about to have a baby, you want to make sure you have a reliable car, and that that it's safe for you and your baby, and you don't want this to happen again within the next few years. So maybe— I mean, I agree, put a down payment down on a car and get something nicer. So I'm just wondering if I'm just being too emotional and I should go into a little bit of debt.

No, no, you know us too well. We're not gonna— we will never steer you that way. And I agree with them, I don't want this to happen again, AKA I don't want your car to catch on fire. So like, we can agree on that.

Um, and they're trying to love you well.

Yes, this is their— they have the best intentions. I'm just wondering if I'm being a little bit too emotional because I literally just got out.

Listen, as a guy who's had a wife who's been 7 months pregnant twice, I don't think there's such thing as too emotional. Yeah, okay, you're right on track.

You are perfect just as you are. And your motherly instincts of like, oh my gosh, I want to— I want everything to be safe. But let me tell you, there's safe $5,000 cars out there, Becca, just so you know. Like I'm like, "When we were kids," well, not even me. I grew up in the late '80s, early '90s. Even when my parents, in the '70s, I'm like, "No, everybody just," like, so, there's a range on what safety means. And for some people, safety is a brand new car. Some people, you know, reliability on X, Y, and Z is what, like, that can mean a lot of things for a lot of people. But I could tell you that there are Honda Civics out there that are as safe as they come, right? Or Camrys, or a Camry, or like, you know, you will find, you can find a safe car. Now, do you wanna drive a $5,000 car your whole life? No, of course not. So my—

I mean, I wouldn't care.

So I drove a $4,500 Prius with 2 kids in it and I'm a big tall guy. Yeah. And I was in Texas and it was a season of shame for me, but that car was awesome and it was cheap and it got incredible gas mileage and it's still on the road today.

It's still out there somewhere.

I totaled it and they guy repaired it and resold it. So like, like, all I have to say is, let me, let me phrase it this way. Had your car not caught on fire, were you going to go buy a brand new car anyway? No. Okay, consider this your first big post-Baby Step 2 challenge by the universe.

Okay. Okay. Yep. And I know that's hard.

Do you have other, do you have other cash available besides this $5,000 just for like medical medical stuff, or like, I don't know, I'm thinking through the baby and all of that.

I mean, technically, yes. Okay. But I mean, that's not—

Well, good, that's good. That's, yeah, that's a good thing. Like that, I would want some level of emergency fund, especially if you're going into— Exactly. Labor and delivery, which is great. I'm not telling you to spend money out. I just wanna make sure that this $5,000 isn't the only thing keeping your head above water financially. How much is in the other account just as an emergency fund?

I mean, we have probably another $1,500. Okay, okay.

So I'd probably buy a $3,500 card if that was for you.

Yeah, how much did you guys make a month? Like what were you put, or let me ask this, Becca. How much extra per month were you throwing at debt 3, 4 months ago that you now have in margin because you're debt-free?

So my husband's, he's a firefighter. His salary is what was paying for like our living expenses. Okay. And then all the extra money— well, not extra money, but the money that I make with my job, which is only around anywhere between $1,000 to $2,000 a month because I do contract work. Okay. We're going towards debt. Perfect. But I mean, that's not going to be coming in for the first few weeks after I have a baby. So that's what made me like kind of freak out. 100%.

But will you have $2,000 in May and June?

Most likely closer to $1,500 probably, but yes.

Okay.

Is there a possibility for 2 months? And I know his partners will get on him. Could you drop him off at the fire station?

Well, I, I would do that, but he drives a manual car and I can't do that.

Oh, okay. Oh, well played, husband. Well played.

I'm gonna get the stickers. But we—

I mean, we have, we have a— we also have a farm, so I have a farm van I can drive for now, but there's nowhere to put a baby in that car, if that makes sense.

Sure. Okay.

But for 2 months, I need a car right now. This is a— I need a car for when I have a baby.

Perfect. That's great. Well, so what I would say probably Becca, honestly, is I would drive that farm van until you have the baby. And then, hopefully, you'll have $3,000 to $4,000 saved before the baby comes, extra than what you have right now. And so, let's just say it's— let's say it's 3 grand, and then you have 5 grand for the car. I would probably wait and buy an $8,000 car, or even, you know, I would, you know, buy an $8,000 car, car in 3 months.

Yeah, once the baby comes home, everything's good, and everybody's rocking and rolling. Yeah, then y'all go get an $8,000 car. Yep. And take that van up to the fire station when those guys are sitting in their recliners. And by the way, I, I'm making jokes, inside jokes to my friends who are firefighters, but have those guys clean that van out for you and make it awesome.

Sounds great. Yep, yep.

So that, that's what I would say. I would not buy anything right now and I would save, you know, $1,500, $2,000 in May and June, and then go get an $8,000 car. And an $8,000, you can get cars for—

You can do great with $8,000.

Yes, yes. So that's awesome. Well, Becca, I'm proud of you. So stick to your guns. Don't fall back in. You can do this. And I promise you and your baby, you guys will be safe. All right, let's go to Sarah in Dallas. Hi, Sarah, how can we help?

Hi, I just wanted some objective advice on whether or not I should spend $6,000 to get a certification that will advance me in my career passionately, but I won't be actually making any more money.

What does that mean?

So I am a teacher and I love obviously working with the kids, but the content that I'm teaching right now is, um, feels kind of like beating my head against a brick wall. And I want to, I already have my master's. I want to go back to school, um, to get 18 grad hours in English. That way I can teach college-level English.

Are you able to teach college-level English? My mom was an English professor and she just retired. That's one of the single hardest jobs to get right now on a college campus.

Yes, so I would be teaching dual credit, which would be on my same high school campus. Okay, great. Uh, yes, I know I would be able to roll into that position in at least 2— the next 2 years probably.

What's the stipend for that, or is it just the same?

It would be basically the same. Okay.

I honestly, if you have cash and it's $6,000 and it's gonna move you to a position that's gonna allow you to teach what you wanna teach and give you 10 years of like work satisfaction doing a thing that you love, I don't have a problem with it.

Yeah. Do you have $6,000, Sarah?

Yes, we, um, I would have it. We would never borrow it. We would be able to work it into the budget and have it. Yeah. I guess my main question is because I have, uh, I have 3 kids. And 11-year-old twins and a 4-year-old. And so when I'm looking at the next 5, 6 years, I'm looking at braces and cars.

And well, y'all, y'all work it out at your, at your house. Like, I, I have a bunch of guitars that if I added them all together would be more than $6,000, but I do that because I love it and we could afford it, right?

And so you see it brings me joy of a passion.

Yeah, it brings me joy and what you do.

And I think you guys will be able to cash flow the everything else, right? You just, you work in life as it comes, and this is the next step in life for you. And if you have it and you guys can do it, then yeah, because you see it more as a passion, not as a, oh, I'm gonna get something that's gonna advance my degree and make more, because that's not the case.

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Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. I'm Rachel Cruze with Dr. John Delony, and we are hosting this hour of the show. So, give us a call at 888-825-5225, and we'll be answering your questions about life and money. All right, let's go to Dominic in Pittsburgh. Hi Dominic, welcome to the show.

Hey guys, um, so, so I'm graduating college this spring from West Virginia University and I just got— it's like a week ago— I just got a job offer for $85,000 for an engineering job. Nice. In Newport News, Newport News, Virginia. So it's for like a naval shipyard. So I've never actually been to the area before and I'm trying to figure out if that's enough money to move there and actually start building a life without putting myself in a bad financial situation.

$85,000? Yeah. As a single 22-year-old? Yes.

Uh, yep, I think you're good.

Yeah, unless you're trying to like go back and forth to the moon, you should be good, brother. How much debt do you have?

Okay. Uh, well, I actually have no student debt and I have a paid-off car.

Nice.

So I, uh, you just need to know that like half of America just drove their car into oncoming traffic because they're trying to support families of 3 kids on $85,000.

Yeah, the median, just to give you a perspective, the median household income is $62,000 in America.

Household, that's, that's 2 spouses.

Okay.

Yeah, honestly, I've been doing a lot of research because I'm kind of, I'm kind of, I'm just nervous about moving to an area that I've never been to, especially because, I mean, I've, I've lived like, I'm going to college in West Virginia. So what part of Virginia are you moving to? Uh, so it's close to Virginia Beach. It's like the southern coast. It's like Norfolk and Virginia Beach area.

Yeah. Yeah. It's down by the Trident. Like, hey, I would get a one-bedroom apartment. And ask.

Yeah, I was looking at one bedroom apartments and looks like they would be about $1,500 to $1,600 a month.

Yeah. That's about right. That's about right.

And don't furnish it with a bunch of stuff. Listen, right now in a really nice house on our back patio, my wife, me and my wife and my son, my daughter was still asleep. We had breakfast this morning on a box with a, with like a sheet over it. Okay. And I think, I mean, if it works, it works. That's what I'm telling you. Like we need to, I need to buy some outdoor furniture. That's totally on me. And my wife's been after me to do it forever, but I want you to know like we had a great family breakfast this morning over a box with a sheet over it. So you're gonna get yourself into trouble if you get the nicest apartment or you go try to buy a house in a town you don't know anything about, and then you try to furnish the whole thing like all bananas. Um, don't do that. Go in as low and slow as you can. And also ask your incoming firm if they have a real estate office. A lot of those folks are, do they have places where they can say, hey, this is a great neighborhood, this is a good apartment complex, et cetera.

Like every place I've ever moved, they always set me up with somebody who could help me navigate that system. And so, ask that question.

Yeah, go rent something. An 85, Dominick, you're good to go. Save tons of cash. I would take it. And you'll continue to, yep, move up. It's amazing. All right, let's go to Cheryl in Fort Lauderdale. Hi, Cheryl, welcome to the show.

Hi, thanks for taking my call. Yeah, absolutely. We've been pushing along Baby Step 2, and I am literally down to just, I paid off credit cards, I paid off the HELOC, I paid off one car payment. Good for you, Cheryl.

And now we have one more car to go.

Wow. Thank you. Um, I realized part of all this, I was supposed to pause on, um, contributing to my kids' college funds. And I looked into it to see if I could pause it and I can pause it. And technically I can even take that money out. In the state of Florida, they have this sort of prepaid college plan that you can pay into that I did when my kids were young. And I've paid in $31,000 at this point to both kids and I owe $38,000 on my car. So my question is, do I pull that money out and put it towards this debt and have my car paid off in the next 2 or 3 months and then start over? Or do I save some of that? Or do I just pause it and leave the money where it is?

Yeah, how much, uh, how much do you make a year, or household income?

Are you married? Uh, yes, we make about $220,000 a year.

Oh, $220,000. Okay, that's great. Um, no, I would not. I would not unplug the investment there. And I would, um, yeah, I would, I would just continue down that you got $38,000 of car debt. And so how much, how much extra can we throw at this? Or do we sell, do we sell the car, um, you know, just to be done with it?

Um, so yeah, I, I have, I would have some major gastrointestinal issues pulling out an investment that's building one way to pay for a depreciating asset the other way. Okay. Because the moment you put— you pay $30,000, that $30,000 on it, in one year that car is going to be worth less than that, right? Whereas that money would have been worth more than that.

Yeah. And my oldest will be off to college in 6 years, so I just— I wouldn't have a ton of money.

Yeah, retirement and college and stuff is one. I mean, if you had like a random stock or something and you wanted to sell it, uh, just to be debt-free, But the, the kids' college and retirement, all of that, if you've already plugged things into those, um, yeah, I would, I would, I would just cash flow the payment of this.

Y'all make $220,000. How quickly can y'all just buckle down and get this thing knocked out?

We're, we're trying to, we're, we, we still kind of struggle with the budget thing. I have two boys in travel baseball, so we're just trying to understand what's, what's monetarily necessary every month and where can we really What could you sell the car for, Cheryl?

I'm just curious, are you underwater on it?

Uh, no, I could probably get $45,000 for it.

I would probably just sell it and be done. Sell it and be done. Go get a used, used something, cuz here, listen, save, save two, save a couple thousand between, you know, the next two months, right?

So here's what I've heard you say is your priorities: travel, baseball, and whatever some coach tells you y'all need to fork over, followed by buy a depreciating asset car, then hopefully kids' education. All of that seems backwards. Yeah. I would put in it, uh, I just tell you, my house, kids' education is first. Whatever depreciating asset me and my wife are driving around town comes second, and then extracurricular activities will come after that. And that's just a values judgment.

Okay. So yeah, y'all make enough, you make enough money, Cheryl, to just pay this off. Just pay this off. Okay, so you have that option. But if you're itching that badly to get out of this car payment, then sell it. I would sell it in a heartbeat more than, yeah, dip it into your kids' college. Okay. Okay. Which I know you probably don't wanna hear that, but.

Well, no, that's good. I mean, just everything I keep hearing, I thought maybe I was supposed to stop 'cause it's just, all it does is it locks in the 4 years. Tuition rate at what it was.

Yeah, and the prepaid tuition we're not big fans of anyways, but if that's the program that everything's already in, I don't know if you can shift or what that looks like. So that's probably a different conversation.

I don't know if you can roll to a 529 or something.

Yeah, if you're able to do that. The prepaid tuition thing kind of locks you in and it's not the best option. But yeah, there's a, I don't know, I'm like, it's the value system conversation, John, like what you were saying. But also, how, you know, our cars have such a grip on us. Like, they really, really do. And it's not a bad thing. And again, I think you guys can—

That grip is not as tight as travel sports, though. No. Yeah. Good God Almighty.

We'll get John on that rant in a little bit. Cheryl, y'all, hey, y'all are killing it. You really are doing awesome for not being great at the quote unquote budget thing. You've paid off another car, you paid off credit cards, a HELOC. I mean, you've done it. You guys have done a great job. And you're at the end, you're probably just exhausted. Definitely, she's got kids' college for a car. Yeah, I might get rid of the car. I'd save up $3,000 to $4,000, go get a $15,000 car. That's what I would do. But you guys are awesome, Cheryl.

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All right, we have Devin in Pittsburgh up next. Hi Devin, welcome to the show. Hey Rachel and John, right? Hello, hello, how can we help today?

So I guess I'm coming a little too late to the realization that, um, I might have not chosen the best college degree for making money, and now I want to make money, so So I'm trying to figure out what the best course of action going forward is to, you know, long-term raise our family income. What's your degree in? English literature. I love to read.

So do you know what my degree— you know what my bachelor degree is in? Sorry? Do you know what my bachelor's degree is in? I do not. Humanities. Oh, that's great.

That was my second option.

There you go. You went one step further than I did. Like your degree is more specific than my, I mean, on the hierarchy, my degree was less than yours. And so I would not blame your current situation on your degree. I would blame it on, I don't wanna blame anything, but I would say—

Yeah, what you're choosing to do.

Yeah, what are you choosing to do and how hard are you willing to work for it?

That's fair. I guess I don't have a clear direction of where to go next.

There you go. That's a more honest question So you got a degree, you've proven to some future employer you can work hard for 4 years and get a thing, and great. And so the big question is, what do you wanna do besides read books and write?

You know, it's a great question. If I really let myself dream, that sounds crazy.

So, I mean, I'm a YouTuber, brother. It gets no crazier than what I'm doing.

Uh, I would love to be like a an outdoor, like, adventure— do an outdoor adventure camp for young boys.

Okay, why is that crazy? I really care about—

I care about men's ministry. I spent 5 summers doing, uh, Catholic summer camp in Colorado.

Why in the world is that crazy?

I don't know where to get the money from to start. I guess you go—

you, you take a job making less than you think you're worth at working a camp this And there's openings at camps all over the country. And while you're doing it, um, me and Rachel, our mutual friend Michael Easter is here in the studio. Um, and he has one of the most successful Substacks on the planet because he's an extraordinary writer and a great researcher and thinker. And so you go work at this camp and you open a Substack and you write about it all summer.

You start to learn about, you know, men specifically, but the struggles, all of that. And yeah, start making a start making a side gig out of it.

All of this is how hard you want to work, right?

Exactly. I'm, I'm willing pretty much right now. I'm, you know, driving for Amazon, got the EveryDollar app, and doing side hustles. And, uh, and married, we have a kid, we're expecting a kid in September. That's awesome.

So go find a boys ranch to work at, um, go find a summer camp to work at and get after it. There's no path forward without disruption.

Yeah, and there might be a season too, Devin, I'll just say, as a wife with when I had a baby once.

Oh, here we go. I'm sure.

That, you know, there may be a season of like, "I'm gonna go take an office job for a hot second, get some stability under us, then we get to make a move towards the thing that I wanna do." Or in the summers, we do this, and then we have to do something else over here, right? Like, I mean, you guys are young. Did you just graduate? Are you guys 22, 23?

25 and 24.

25 and 24, okay. So there may be, you know, a season from a financial standpoint that you, you know, do something you may not love, but at least hopefully it's in the realm at which, you know, you can either do something on the side that you're enjoying. But what are you good at? What would you say?

I'm a really gifted writer.

Yeah, so maybe there's a job within that, right? Copy editing, ghostwriting, you know what I mean? Like plugging in what you're good at too, and not just your passion, but I think working towards where those things can intersect could create a great life.

Or spec writing, and those jobs with AI are getting increasingly hard to make a living. But man, if you're good at Substack, I pay money money for only a few Substacks, but I do pay money for 'em 'cause they're good and I value what I'm getting, right? So, but that's just rep after rep after rep after rep.

Yep, so there may be a journey ahead and we dearly miss Ken Coleman, our friend, but I'm still gonna shout out his book, "Find the Work You're Wired to Do." We still have copies.

Yeah, well, down the line, we'll hook you up with one.

Yep, so Christian will pick up. But yeah, take that assessment 'cause that, I mean, I do think I think generating ideas is really big. And you may be in a season where, again, and I'm kind of, I don't know, I heard this message. I was like, you know, it's kind of good of like, work on what you're good at, your talent. And then that provides a great living for your family. And if that crosses with your passion, quote unquote, like that's great too. Yeah. But this whole idea of just chasing your passion and doing whatever you want, you know, may not be a season where you're able to support your family and that's okay. But like, find what you're good at and make some great money doing it. And then, I do think your life, I mean, you are in just one small chapter of your life right now, Devin, and it will continue, and the opportunities and doors. I mean, you said this the other day on the show, where you were, what was it, 8 years ago? It was like 3 different houses, 2 jobs.

My first graduate school class was at the age of 26. So, a year after his. That was my first master's degree class, right? And so, yeah, you got a whole adventure ahead of you. But I do remember this, I do remember pacing around the house at 25, thinking I was failing everybody. And so, I get that sense in his chest, like, Yes. I can't, I'm not gonna make it.

I'm not doing enough. Right. Or yeah, yeah.

But man, take action. And you said you worked for 5 summers with young people and you developed a passion. Reach out to those contacts and see what's available. For sure. Or volunteer at your local church. Like there's so many opportunities that are gonna take you a lot of time, a lot of energy. And that's hard with the newborn, but man, get after it.

And what's wild too is we love Young Life in our house. That's where Winston and I met. And, but they have, you know, property sites onsite families that live on these camp properties.

That's what I'm saying.

Like, all year, and that's like where they live, and that's their job is to take care of these kids.

Texting me all the time, hey, do you know anybody who wants to move to New Mexico or to Southern Missouri and work on this camp?

So maybe there's a fun adventure for you guys with a baby, and like, yeah, there's no rent. Yeah, no rent, and you get paid to do it. Like, I don't know, maybe it's something fun like that too. Devin, thanks for the call. All right, let's go to Holly in Milwaukee. Hi Holly, welcome to the show.

Hi, um, so I am currently in the middle of leaving my HR job to potentially go part-time Um, and I'm struggling with whether we made the right financial decision.

Okay, why did you choose to go part-time?

Um, I was burnt out. Um, I was the head of HR, um, out in a company out in, um, the Pewaukee area. And, um, with 3 young kids, um, I have a 5, 3, and 2-year-old. Oh wow.

Yeah, so you want to be home more?

Is that your hope? Yeah, and actually I've been in talks with the kids' school about potentially doing 2 days a week there so I'd have the summer off with the kids.

Yeah, yeah, that's That's great. Well, are you guys able to survive financially on you working part-time and your husband working full-time?

I think so. We ran through the numbers. This is kind of one of the most irresponsible things I think I've ever done, not having something for sure lined up before leaving a job. But—

Are you guys able to take care of your necessities in May and June?

Yes. Yeah. So we have close to $40,000 in our savings right now. Okay. $28,000 of that is dedicated to our emergency fund. Emergency fund. And I would say our monthly spending and what we need and everything, um, with a little cushion, is about $5,000 a month.

Okay, what does your husband bring in?

Um, he, he's based on commission, um, but roughly about $6,000 net.

Okay, so you guys can, you guys can keep your head above water. You're not having to dip into the savings with just his, right? Right. Yeah, yeah. Holly, you're not overly irresponsible. You're so, you're so kind of you to say, like, so, like, not That was so heavy to say. You guys have $40,000 saved. Do y'all have a lot of debt?

Um, we have a, um, $13,000 van loan.

Okay.

Um, that we're aggressively trying to pay off. Okay. Um, and then we have $97,000 left on our house, which should be paid off before we're 40.

Yeah. Holly, I want you to change your narrative from I'm leaving this job to want want to I want to stay spend more time with my really young kids. It. Okay. Yeah. Because you're talking about this like you're failing. Like you're making an affirmative choice.

You're a hard driver, Holly. Yeah.

You're going to do a thing. That's amazing.

That's awesome. I just, I don't want to let my husband down.

Oh, sister, you're not. You're not.

Yeah. You're not. Okay. Yeah. So many working moms I know, there is this like, it's a guilt factory. Well, that, and they carry that they have provided for the family financially. And now when that's gone, they're like, it's not even an identity thing. It's like, I feel bad that I'm not contributing. I'm reading where I go, you're good, Holly. Enjoy the summer with your children. You are fine. You guys live on that $5,000. Don't go over. Go get a part-time job at the kids' school. Pay off this van. Once you get a job, you guys need to pay this off with the money you have saved and ride into the sunset. You're doing great, Holly.

You're doing great.

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Okay, so I think a perk about working at Ramsey Solutions is we'll be sitting in the studio doing a show on the glass, and we'll see guests walk in to do other shows, because the Ramsey Network has multiple shows that have guests on and not always lined up for this show. And we had a guest walk through, and Jon and I were like, "Oh my gosh, is that who we think it is?" So we just grabbed him and we were like—

He did. One of my favorite people in the whole world.

He's supposed to be on with George Campbell, or he is gonna be on George's show, but we grabbed him to do a segment here, because Jon and I both love him so much. But Michael Easter is here, Hi, Michael. Hello. Welcome, welcome to the show. So, I was introduced to you because of your book, The Comfort Crisis, that I read. And this was probably— when did that come out? What year was that?

20— it's about 5 years ago now.

5 years ago. Okay, so, I bet it was probably 4 years ago when I read it, because it had been out for a while and I love to read and I kept seeing it float around all these lists. So, I'm reading The Comfort Crisis and we were on vacation. So, I was like—

Let me frame this. She was in Cabo.

I was by a pool.

An infinity pool that was overlooking the ocean.

There was a resort involved.

Yes, overlooking the ocean.

But the whole premise of the book, which I want to get into, because I think it does tie into people sacrificing and getting out of debt and like what it does. But the whole thing is like, we are too comfortable in our world today from like, not only a physical standpoint, but an emotional, environmental, all of it. Like we have created such comfort around us so we don't grow. You don't push yourself when you're comfortable, right? You have to be, you know, not being comfortable. So, I'm reading this book and I'm thinking about my friend, John Delony, and I was like, John would love this. "this book." So, I put the book out where I am, and I just take a quick picture, and I send it to Jon. I text it to him. I'm like, "Jon, you have to read this book. This is straight up your alley." And he—

And I was like, "A, I read it like a year ago, and B, just look at the photo you just sent me." And it's like, an infinity pool, the ocean—

And it says, "The Comfort Crisis." —perfectly manicured toes, and "The Comfort Crisis." So great. Basically, like, don't be comfortable.

But you're basically Your book, "The Comfort Crisis," and then "Scarcity Brain," your follow-up, has burned through this company. It's become like a thing that we all talk about in all of our meetings all of the time, 'cause it was so impactful for all of us.

Yeah, so give us the premise real quick, 'cause I do wanna tie this into the financial side. But give us a premise of "The Comfort Crisis" for the audience, they kind of get this idea, or—

Sure. Yeah. Quick rundown is the world has become more comfortable over time in every way, right? We have to walk less, we're not as hungry anymore 'cause we've got food everywhere. We've just engineered discomfort out our lives, which is good in the grand scheme of time and space. It's nice to be comfortable, but at the same time, we've lost these things that keep us healthy, happy, and that teach us something about how to be a better human. So tying that to the financial element, when you're trying to save money, that is hard. When you are on Amazon and you put that thing in your cart and you go to buy, it's going to be so great. And then you hear your voice in your head or Dave's voice and you go, oh, I shouldn't buy this, right? Not clicking buy is really hard. So I think that all growth happens through doing things that are hard. Yes. If something's gonna improve your life, it's gonna be uncomfortable in the short term. But the point is, is that you get these long-term rewards by embracing that.

I love that. Okay. And every business talks about how do we make a transaction less and less with less and less friction, right? I just went and bought lunch and now I just wave my phone over a box. And by the way, based on a Substack you wrote the other day, and we'll talk about that in a minute. I didn't even make eye contact with the guy. He was looking somewhere else. And so there we've extracted human interaction out of all of these things. And so he, he stuck this thing out. I waved my phone over it. We had a robot to robot interaction, no personal connection, but it was all so frictionless and it, it didn't feel like a real exchange, but it actually took $11 or whatever outta my account. That's real money. That's real sweat equity I put into that thing.

Yeah. And I will say the faster you can do something, the more likely you are to do it. So this is why there's one-click buys on Amazon now. This is why companies are, especially online, like removing steps to make the actual purchase. So we've really increased the speed of all these things that I think can be poor decisions, but it's like you just make it so quick. What happened? Yeah.

Or my first mortgage, I had to sit down with a lender and we went through a stack of papers. Now it's, you can get online and we'll approve you right now.

It's a green sign. It's a green sign. Yeah, so from the purchasing consumer standpoint, it's taken out any level of discomfort. So you are more likely to spend and not save, because the saving, you know, pushes patience and delayed gratification, which you were just saying is so difficult. So speak to the families, because there's a lot of listeners that they're trying to get out of that consumer debt. They're deep in credit card debt, student loan debt, car debt. I mean, it's just all of this. And they've gotten to a point where they're like, I'm so sick of this, I'm done. I'm going to get out. And we teach that when you get out of debt, you have to sacrifice your lifestyle. All of what you were spending, spending, no vacations, you're not going out to eat, like you are limiting everything and throwing anything you can at that debt. And it is so hard for people. They call in and they'll say, "How do I stay motivated? 'Cause this is so difficult." So speak just some encouragement that this idea of sacrifice and what you're putting yourself through for a greater good to get to this point, you know, where you have autonomy over your money, you don't owe anyone anything, like what that sacrifice is actually doing to the character of who they are and what's happening inside of them.

01:11:08

Yeah, I'll tell you, story for an example, and then I'll pull out big picture. When I was a professor at NYU or UNLV, I had a student who crazy in debt, just like she's married, she had kids, so much debt. It was totally ruining their life, causing a lot of marital problems, causing problems with what they could do with their kids, what programs they could get them into. She started following Ramsey stuff. She's like, it was the hardest thing we've ever done. But she got out on the other side of that and then she could put herself through college. Which means she could earn a higher income. And she's like, "That was so hard in the meantime, but now that we went through that, I look back on that and I go, that's one of the most rewarding things we've ever done for our kids because that taught them a lot, for our marriage because it brought us together, and also personal fulfillment." So to pull back, when you look at what gives human beings fulfillment, it's never the the easy thing. It's the things that we had to struggle through. Good example, if I asked any parent, what's been the most rewarding thing in your life?

Like, what's most important to you? Most people are going to say their kids. Yeah, it is my kids, full stop. Then you ask, well, is that always easy?

What's the most challenging thing?

Like, yeah, what's the hardest thing?

Yes, that you've ever done. Yeah, exactly. Now you can apply that to any situation in life.

Health, you know, marriage, yeah. Health, finances, whatever.

Realize that, almost think of that as that hardship as like, that is a signal that something important is happening that is then going to improve your life later. So you can actually get to a point where you feel that and you go, ah, something good is about to happen. Takes a while to get that mindset shift. It's always gonna be hard in the short term, but once you've gone through a few reps, I think you start to see that as something like, Aha, here's the opportunity. Yes, it's gonna suck, but I'm ready for it.

Yeah. So good. Let me, for the listeners out here who are new to Michael Easter, and you know this, you and I are personal friends off air, but your voice has rang through my mind so often the last 5 years that it has reframed how I teach marriage. It's reframed how I help people who are struggling with their kids, like trying to manage their kids. And it all started from an idea you had or an article you read about the 2%. Yeah. Right. And that's based on the 2% of people at the airport who will use the stairs instead of the escalator. And at 2:00 AM when we're, Rachel and I are on a live event somewhere and we're schlepping through the, it's like, take the stairs, Stallone. And I'm like, I will. But here's where that has expanded my whole life. When my wife and I have a conflict, conflict. It's easy for me, honestly, to get some flowers, to pretend that conflict didn't happen, and then to go about our regular routine. And it has developed— it has given me a new language that is, the tension is the doorway. If my wife and I have a discomfort, I'm going to take the stairs.

Let's have this conversation. Let's get to the root of this thing so that we can get to where we want to go. And Michael, I got to tell you, it has transformed my marriage. It's transformed how I parent my kids.

It's true. Everything. The 2%, real quickly, how did that, how, how'd you come up with that?

Honestly, it comes from a study. Yep. Yep. Came from a study. And, um, that always just sat with me. Mm-hmm. Because I feel like it's a metaphor, right? It's 100% of people know that, that taking the stairs is gonna be better for their long-term health and wellbeing. Yet 98% of people go, no, I'm just gonna do this really easy thing. Yeah. Like, that's gonna feel so much better. Um, but those 2% of people, like, that can become a metaphor. Yep.

Of all these other decisions. It sure has for me. And, and I want everybody to know, um, Michael has a brand new podcast, The 2% Podcast, that I, I personally subscribe to, and I pay money for his Substack. It's that good. Um, and I like to hit my friends up for free stuff. I don't, not for this one, because it's worth every penny. The 2%, um, Substack by Michael Easter. Go check it out. Michael, thanks for being here.

And just the encouragement to the audience to be the 2%, that the sacrifice that you have changes you in a good way. So yeah, thanks for jumping in last last minute. Of course. Appreciate it.

Thanks for having me.

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Dude, being around Michael Easter makes my life better. You like him. He's just a good human. Great human being. I'm glad he swung by. For sure.

So, I know, thankful, thankful you hopped in. Well, you guys, we wish that we could get to every call on this show, but if you have a money question, we have an answer for you. You don't have to call in on the show. We love YouTube because it's always fun talking to you guys. But if you have a question, you can head over to Ask Ramsey. So this is our free AI tool that's built and trained on proven Ramsey principles. So AI, you put all the stuff in it of what you want it to spit out. So they've put all Ramsey stuff. So shows over the past couple of years, transcripts from live events and books and articles, like anything and everything Ramsey is in this. And it's crazy how accurate it is and how wild. I know people have like a love-hate relationship with AI. AI. But it is crazy how quickly it starts to like learn you and know you and like, it is wild. So we've had multiple people put their specific situations in and keep coming back to it and it remembers you.

And it's not gonna just tell you how wonderful and great you are and try to hug you like some other AI products.

Yeah, I'd be like, please be nice to me. No, but it really is amazing. So check out Ask Ramsey. Again, you can ask your question. You can go to ramseysolutions.com and you'll see Ask Ramsey there on the website. Or if you are listening on podcast, podcast or YouTube, you can click the link in the description. All right, let's head to Lindsey, who is in Charleston. Hi Lindsey, welcome to the show.

Hi, thanks for taking my call. Absolutely, how can we help? So I'm calling today because I recently got married in December and my husband has actually offered to pay off my student loans. Nice. And my question is, should I let my husband pay my student loans off?

Absolutely not, I'm just kidding. Yes. Well, let's talk bigger picture here.

What's causing you to hesitate? Are you still seeing this as his money, your debts, and you guys haven't really combined money, not even tactically, but even emotionally, like, "This is our household, and our household has this amount of debt. Our household brings in this income. Our household has this much savings. As a household, how do we tackle our money?" It's still more pretty divided emotionally for you. Right? Yeah, a little bit.

So I owe about $28,000 left, and I think my hesitancy kind of comes in because I don't find that it's his responsibility to pay on my debt. This is the only debt that we have, um, I guess together, but it's really— I look at it more like it's my debt because I was the one that chose to go to college, 2 degrees. Yes. And so I kind of am like, is this really his responsibility if I've been the one paying in all these years.

So you have $28,000 in debt. How much does he have saved? Um, so he has—

I mean, we have a net worth of $700,000.

And, um, how much is liquid? Like, how much— I mean, how much cash do you guys have?

Um, I'm actually not entirely sure how much exact cash we have.

Okay, so let me ask you a weird question.

Well, how do you know he can pay it off if you don't know how much money you guys have? Did he just say, I'll pay it off for you?

Um, well, I do have like an understanding of how much he makes and his net worth, but money isn't really, I guess, an issue in that regard. He can definitely pay it off and there's, there's no problem. It's more of like, I just don't know if he— if I should allow him to do that, if I feel like it's my responsibility.

All right, let's say that he had— when he was a kid, he fell off a slide slide and hurt his knee, and then next year he's playing pickup basketball and his knee blows out all the way. Are you going to look at him and say, well, you brought that bum knee into our marriage, so that's yours? No, no. So when you get married, both of you take on all of each other. And so it's y'all's combined income, it's y'all's debt, it's y'all's money. And the, like, the research bears this out. Not, it's not just Ramsey running our mouths. Like, the psychological and economic research says that couples that share a single checking account, not even a checking account and you each have your own on the side, um, cuz that was part of the test. A single checking account forces y'all to say, who are we? Who are we gonna be? Who do we want to be? And how much do we have. And so just that one act of sharing a checking account forces couples to come to the table and talk about values, talk about dreams, talk about visions, and then talk about how to get those dreams and values and visions out in the real world.

And it just is a shape-shifter for couples. And so this is not your debt anymore. This is y'all's debt. And it's not his money anymore. It's y'all's money now. And so sitting down and having a bigger conversation about who are we gonna be with our money? Is where, I mean, this should have been, your premarital counseling should have covered that, but you're already married. So that's the next immediate step y'all need to take. Okay. That makes sense.

Yeah, and Lindsey, we know we have found the fastest way to build wealth, the fastest way from point A to point B is to be completely debt-free, have an emergency fund that you can tap into when things happen, be invested, investing into retirement and other things, have a paid-off home, and you just start living your life. And when you have kids, you invest for their college, all of that. But the no debt and investing aspect, and no debt, I mean, even like no mortgage, like everything is paid off, right? To the ultimate. That's our Baby Steps. That's our Baby Step 6, okay, is paid-off house. So that's part of the Ramsey plan. But we find people that can build, that build wealth quickly. Quickly with their net worth, they're all in. And so, if you guys together say, "Hey, we want part of our legacy to build wealth, not just for us and just to be rich, right? But to, when we have a family, to be able to change our family tree, to be able to bless others and be generous. Like, we wanna use money as a tool in that way. And we're gonna work towards, you know, being good managers of that." The fastest way is to get outta debt.

And if that's our goal as a household, again, as a couple, couple, okay, fastest way to get out of debt, let's get out of debt, like tomorrow, because you can. So, check it off, right? Like, I mean, there's a path of least resistance here, and it's not you taking advantage of or all that. And I hear you saying, like, I just want to take ownership of what I've decided. But I think Jon just, yeah, painted a really great picture that when you marry, I mean, it's all of you, right? And we're in this now together.

Ask you this. Is this, um, and the way I'm going to ask, it's going to sound mean, and I'm not meaning it to be mean, okay? Same team, right? Are we good? Yes. Okay. Is it your ego that doesn't want him to pick this up for you, or is he not very forthcoming with finances and that's kind of his domain and you feel small talking about money around him?

No, he is very open about like how much he brings in and everything. I think it's more of me. It's like a personal thing. Thing. Okay. Um, that I'm just like, I don't know, I guess I look at it a little differently of like, you know, I brought on this debt well before I even met him. I went to school, whatever. And so I'm like, is this like, should he be held responsible?

But I do understand he married all of you, right? For better or worse.

And you can tell him like, oh, I have some guilt doing this, you know, and talk through it.

Or tell them, I've been holding back a part of myself from you. Yeah. And I've been trying to hide this part that I'm embarrassed about or ashamed about, whatever, and we're married. I'm gonna put all of me on the table here. Yeah. And do y'all share a single checking account? No, we don't. You should.

Yeah, I think this could be a good meeting of the minds tonight, right? I mean, sit down together genuinely and just say, hey, what do we want this part of our marriage to be? Because you'll have those conversations. What do "what do we want this part of our marriage with holidays to look like with family and where we split time?" "What do we want, you know, our marriage to look like when we wanna go on a vacation with just the girls or just the—" Like, I mean, you'll have these conversations in marriage. "How do we want our marriage to be?" And money is part of that. And the quicker you guys can get on the same page, Lindsey, honestly, it's gonna create a level of unity with you all that is, that's so beautiful. And the earlier you are in this marriage and to create a great pattern starting now, now is really big. So we are, we are so big on couples are one. You share everything. You're together. You are transparent. You talk about big decisions when it comes to money. You're on the same team. You guys are on the same team running a household.

And when you look at it that way, not only do you build wealth faster, but there's a better relational sense.

Um, and I'll, I'll never understand couples who share DNA and make humans but won't share share their, their income. Like, that's always Bizarro World to me. It's like, we can, we could create humans together, but this is my money and that's your money. Like, that's just Bizarro World. Put it all on the table.

Do you think he would— well, would— do you want that, Lindsay? Would you want that level of, of unity and working together, or are you kind of like, eh?

I think I'm open to it for sure.

Okay, how do you think he would respond to it?

I think he is more He's definitely the one that's all for it. I'm more of the hesitant one. Okay. I'm just, yeah, it's an ego thing I need to get over.

Yeah, no, I mean, you don't have to, don't just get over it, push through and understand that about yourself and bring him to the table with it. And it's a beautiful learning. And we, yeah, you guys are gonna do great. Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. I'm Rachel Cruze here with Dr. John Delony, and we are answering your questions at 888-825-5225. All right, let's go to Orlando, and we have Rick on the line.

Hi, Rick, welcome to the show. Hi, thank you.

Absolutely, how can we help today?

Well, I have a question because I did the calculations for, um, the net worth and it turns out that I have more than $1 million of net worth. However, congratulations. Yeah. However, um, really all of that net worth is, is in my home, my primary home. And so, uh, last year I got into some, um, no, I didn't get into, but, uh, you know, my business went south, business went south. It wasn't making money. I was keeping it afloat by with some, um, personally guaranteed loans and it just wasn't making any money. So I decided to close it down and moved to another town where I got a, um, salary job in the same, in the same, uh, industry. So, uh, when I left my home, I rented it. I rented it out, and the current rent there, uh, pays for the mortgage of the home, plus, plus it pays for the rent of the new home in my new town right now, and, and some expenses of, of the original home. So it's being rented out, but I also have a large amount of debt. And the debt, I can't keep up with the debt.

It's, um, I can't make really all the monthly payments each month. So, uh, my question is, should I sell my primary home where all my equity is in order to pay off the debt, to, in order to pay off all the debt, and then I'll have some proceeds left over for possible, uh, my new home?

My answer is a little bit different because you're currently not living in that home, you're living somewhere else. Are you going to be going back to that primary home at any point and sell? Because you own two 2 homes, is that what you're saying?

And I own one home and I'm renting in the city. Oh, you're renting where, where I moved to.

Yeah. Will you be living where you are now probably for the foreseeable future?

Yes, for the foreseeable future. Okay.

So regardless of debt or not, I would say don't be a long-distance landlord. So I would be, I would, I would sell your primary home anyways. And depending on your financial situation, take the proceeds and buy something in the city, um, or use it for a down payment or what that looks like, and then go about your way. But you're, you know, your situation's a little different because I would still sell the home, but how you use the proceeds of the home now may not be for a down payment. It may be to clear up this consumer debt. So how much debt total are the loans?

Okay, the, the loans and the debt total is $300,000.

$300,000. And was that business debt? Is that what you said? You got, you You took out the loans for your business that you closed. Yeah. But I also had some back, uh, IRS tax debt.

Okay. I have $105,000 tax debt to the IRS, uh, which represents about 4 years, but I'm in a payment plan for that. It's not like I'm delinquent or anything. I'm in a payment plan and paying it monthly. And then there's $154,000 in personal loans for the business and credit cards because credit cards.

Too. So, gotcha. And the credit cards is what, probably $50 grand? Yeah, at least. Okay, so that's the $300,000. That's how it's broken up.

How much equity on this house do you have?

The $300,000 also includes, uh, 2 car loans and 2 car leases. 4 cars. All right. Yeah.

Who's driving all these cars?

Myself, my wife, my 2 children, who are now, uh, once finished— when they're both college. Okay.

Um, how much car debt is there? $57K. Okay, will you break that? Which per which car?

No, that's, uh, the 4 cars combined together. It's 2 loans. Okay. Of purchased cars and 2 leases.

Okay. Um, all right. And how much equity is in the home?

Well, the home is estimated at a value of $1.6 million, but, um, I think it may go higher than that, maybe, I hope, close to $2 million. The mortgage balance on it is $230,000. Okay.

Why do you think it's going to go for $2 million? Because the comps in the area, the how houses are going?

The comps in the area that I've seen right now are about $1.6 million, but the features inside the house, it's newly remodeled recently in the past few years, and it's high-end upgrades of, you know, all the fixtures inside. Okay.

Okay. Bathrooms, bathrooms, kitchens, flooring, walls. So we'll say worst case scenario, scenario, 1.7, okay, just for the sake. Okay. And so, so yeah, I mean, so yeah, hopefully you would clear, golly, you know, 1.4-ish, 1.3 possibly. So if you did clear out the debt, you'd have $1 million. What could $1 million buy real estate-wise where you you are now?

Uh, I've been looking in a pretty nice home.

Very nice. Okay. How much do you have in retirement and investments?

Okay, retirement myself, my, my 401k is, uh, $10,000, and I have some investments. I have about, um, $60,000 in, in, in the, uh, stock market, and, um, I'm using it for, you know, trading stock options on, on and off. Mostly my wife is doing that. Okay.

Does she have any retirement?

Uh, she had, uh, $30,000. No, not right now. Nothing in 401k. It's all in the stock market.

Okay, but she has an additional $30,000 invested somewhere. Okay. Yes. And how old are you guys? I'm 62. 62. Okay. Yeah. Um, I mean, would I— I mean, I would not make the mistake, which is kind of what you made with the primary home that, like, and you said that opening this call, that so much of your net worth is tied up in real estate, which is not going to be great. I mean, having a paid-for house in retirement's awesome, but if you don't have any money to eat with, then it kind of negates the purpose.

So I would then, uh, yeah, that home is, um, the mortgage, uh, is paid off in 6 years.

Okay, well, yeah, but you don't have any money, brother. You'll be 68 years old with $10,000 in retirement and a $2 million $1 million house.

Right.

Yep. So I would diversify a lot more than you have, Rick. So I would sell it regardless, again, 'cause you guys aren't living there anymore. I would see this as a gift that you all have done so well paying down on the home and it's gone up in value, which is amazing. And I would use it to clear my debt and I would make a contract with myself and my wife and my family that we do not go into debt anymore. We don't play that game. Yeah. So we're done with debt. And then I would look and I would probably sit down with a financial advisor and just say, hey, when we run out the numbers and when we want to retire, how much, how much would we need? What, what does this look like right now? Because I mean, if you got a million bucks sitting on the floor, I would not go spend it on a million. Now that I know your retirement situation, I wouldn't go buy a million dollar house, brother.

I'd buy a $350,000 condo and put $650,000 in retirement. That's what I would do.

Like, uh, uh-huh.

You're, you're gonna have to—

that was one of my questions I was going to ask you also about what to do with the proceeds.

Yep. So the goal would to have enough in retirement that you guys feel good with. And granted, you're still gonna be working some, so you'll still be contributing, but also have paid for real estate. Can we get, can we get that both done with this million dollars? 'Cause that, that's life-changing right now.

Or can we get a small house for $400,000, get it completely paid off? Yeah. And you can get a nice small house for $400,000. We're gonna get paid off, be all done, put $600 grand in the market.

But what this does, Rick, is it shifts your expectation of lifestyle. You're leaving a $1.6, $2 million home.

Yeah, that lifestyle.

With two nice cars, two leased cars, and you're choosing a more simple lifestyle for peace and the ability to retire with dignity. So screw what everyone else thinks. You know what I mean?

Like from the looks of things. Go to ramseysolutions.com and check out our SmartVestors in your area and they'll help you with the investment side of what to do with that extra money after you sell your house.

Yeah, but there's gonna be a level of humility that it's gonna take to do this, Rick, but honestly, it's gonna create more peace in your life. Hey guys, Rachel Cruze here, and I love summer. There is more fun on the calendar, more time with your people, and way more chances to make a mistake. Memories. But you know what else there's more of? Spending. Oh, between the extra groceries and gas and camp fees and family trips, it all starts to add up so fast. And before you know it, money stress starts to steal the fun out of everything. And that is why I love the EveryDollar budget app, because it helps you plan your money, track your spending, and find more margin in your budget so that you can put extra cash towards the goals that matter foremost. Enjoy your summer without the money stress. Download the EveryDollar app in the App Store or Google Play and start for free today. The Ramsey Show question of the day is brought to you by Yrefy. If your private student loans are in default and you're not sure what to do next, Yrefy can help you explore refinancing with a low fixed rate and a payment plan based on what you can actually afford.

Go to yrefy.com/ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. May not be available all states.

All right, today's question comes from Maggie in Mississippi. I am a 50-year-old single woman earning $53,000 a year. I have $25,000 in credit card debt, car debt, and a personal loan from my father. I realize now I was very irresponsible and I've shredded the cards. I have my $1,000 emergency fund and I want to tackle the debts, but after all my bills are paid, I have $150 50 bucks a week left to eat and pay for gas. The minimum monthly debt payments are more than that amount. Should I pay the bills or buy food to be able to eat?

Oh, Maggie. Um, yep. So a couple of things. So you always will want to eat first. So when you're in a dire financial situation where this is literally paycheck to paycheck, before the creditors are paid, before the credit cards are paid, you pay food, shelter, so your rent or mortgage, utilities, and transportation, making sure you have gas in your car and all that is good. So that's what we call your four walls, because without that, then you start putting the priority of your own self and survival, right, above Mastercard. So, yeah, so you need to make a list, Maggie, and list out everything and see before, after food, shelter, utilities, transportation, Then what is left is where the minimum payments come in. And what the magic is gonna be for you in this is making $53,000 a year is gonna be extra work, 'cause income at that point is your problem. And so it will be working weekends and nights, and it's not gonna be fun. But if you can bring in an extra $2,000 to $3,000, whether it's waiting tables, you know, bartending, I don't know what it is, dog sitting, I don't know what that looks like.

Like, but I would make it a goal, which means, yeah, you're gonna be working 60, 70 hours a week.

80 hours a week, yeah.

It can be a lot, but only for a short period of time. 'Cause if you think about this, and if you can do it, and you can get 3 grand, you know, a month to be able to throw at this debt, I mean, in 8, 9 months, you're done. You're completely done. Then you get to quit everything and go back and live on your salary. Salary, because when you don't have payments, you actually have margin at that point. So it's kind of this like season of sacrifice that is what I see. That's the path I see out for her.

And the way I've had to navigate these tough seasons of my life is to make a commitment. In her case, she's 50. It's a— I'm pretty dramatic, as you know, Rachel, but I like some sort of commitment ceremony. If I had to do it again today, I'd probably write a letter, but some sort of commitment to 52-year-old me. I'm gonna do this stuff right now for future me. Mm-hmm. And for whatever reason, when I'm doing it for somebody else, it makes it easier than doing it for myself sometimes. And so I'm gonna work like crazy. I'm gonna not do stuff, whatever, in service to 52-year-old me. And it might be writing a letter to 52-year-old you talking about the sacrifices you made at 50 where you would work full— your full-time job, you would eat a ham sandwich that you made or peanut butter and jelly sandwich on the way to stocking shelves at a grocery store until 11 at night, get up the next morning, go again. And you're just going to know for 9 months I'm going to be really, really tired, but I'm going to knock this thing out. Yep.

Oh, hope that helps, Maggie. But yeah, I think it's a tough situation. Prioritizing is really big when it— when everything is that, um, condensed money-wise with your expenses. So priority Remember, food, shelter, utilities, transportation. All right, let's go to Rebecca, and she's in Portland, Oregon. Hi, Rebecca, welcome to the show.

Hi, thanks for taking my call.

Absolutely, how can we help today?

So my husband and I have been working on the Baby Steps. We're on Baby Step 2. We had almost all of our debt paid off except the house. We had $2,500 left on our truck, and then our paid-off car needed work that cost more than the car, was worth. So we— and we— my husband commutes 40 minutes daily to and from work, and so we needed a commuter car. And so with $6,800 in savings, we spent $5,500 on a car that immediately needed $2,800 of work because of a tire problem caused at a dealership. And so now we financed the work through the shop. It was 0% interest for 24 months, so I just— we decided to do that instead of put it on one of our credit cards that are paid off. And so now we have $5,300 in debt. My grandmother set up a stock account for me when I was a baby. It's grown to about $38,000. And so I'm just curious, would you guys recommend cashing it all out, taking out what we need for the debt letting it sit until retirement, or what, what I should do. We also have, uh, my husband has 2 shoulder surgeries coming up in the next year, and, um, we do have an HSA with about $4,000 in it, but that's not going to cover the surgeries fully.

But we do get financial aid through the hospital as well. We're kind of like a lower income household.

So, um, sorry, how much debt did you say the dealership was? I know it was 0% interest for 24 months, but $2,800 through the—

$2,800 through the repair shop. Okay, gotcha, gotcha.

And then you still have, uh, did you say $25,000? $2,500. $2,500. Okay, perfect.

Did you get your $5,500 car— did you have it inspected?

Uh, well, yeah, that's what we took it in initially for, um, and yeah, I mean, we had already purchased it by the time that, um, we had the tire problem.

So usually the inspection comes before the purchase, right?

Yes. Yeah, we— yeah, we've had good luck with cars and we're hoping we would have the same luck, and we didn't.

Yeah, no, that's okay. So you guys have $5,300 total of debt and you have $38,000 in the stock. What kind of stock What stock is it?

It's just individual stocks. It's like Disney, Home Depot, that type of thing.

Okay, is it in like a mutual fund or it's like 10 individual stocks? It's individual shares. Okay. Yeah. Gotcha. Okay, well, the short answer is yes, I would cash those out to pay this off. Okay. And yeah, you'll probably be paying, depending on how it was all looped to you from your grandmother, if she had it in your name, in your name?

Yeah, she moved it to my name when I was 18. Okay, gotcha.

Um, so yeah, there may be some taxes implications in that, but just, you know, be aware of that. But I would, yep, use some of that. And then I honestly would not stay in single stocks like that. I probably would end up cashing everything out and just moving it to an index fund. Um, yeah, like an S&P 500 or something. You can open up a brokerage account and just do it through that, and you can do that on your own if you through Fidelity or Vanguard. You know, there's some easy companies that make it pretty easy. Just because I don't like the single stock mentality anyways. So that's probably what I would do. And then when you have that, yeah, to be able to take some of that to pay off the $5,300. And then you guys prepping for, which I'm thankful you know about the medical ahead of time. So with everything, you said you guys have the HSA $4,000 and then you have some coverage covered, how much out of pocket will you have to pay?

Uh, I'm not sure yet. Um, we haven't gotten an estimate from the hospital yet, but we do know that he needs both. Okay. Yep.

So, uh, do you have any idea— have they given you any range? No. No. Okay. So I would find that out because it's going to help you guys to plan and to know how much you guys need to set aside per month. How much are you guys making a year?

Uh, we make about $68,000 a year. Uh, that was last year. I recently I just, um, got my certification, um, for my job, and, um, we're kind of like— so I'm— and I'm also up for a promotion, so we're kind of looking for additional ways to earn. And, um, there should be a couple of good raises coming up soon.

I'll tell you my one concern about doing this is you guys have been working hard to get out of debt, and I know you felt squeezed, but you haven't fully metabolized capitalized, we do not go into debt, right? Yeah. And so my fear is y'all gonna cash this out and it's gonna kind of become, uh, just like kind of a just-in-case account. And so y'all are gonna have to make a firm commitment that if we do cash this stock out and we pay this debt off, we're never going into debt again, and this is not going to become just kind of a slush fund.

Hey guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now you can get that same kind of help anytime with Ask Ramsey. Ask your money question and get answers built on Ramsey principles we use on the show. Whether you're making a decision or just want something explained, Ask Ramsey is here to help. It's fast, simple, and free to use. Go to ramseysolutions.com and try Ask Ramsey today. That's ramseysolutions.com.

If you're working the Baby Steps, the fastest and best way to do it is by using EveryDollar. So this is more than just a budgeting app. It is the plan that is built right in. So you can track your progress, get personalized recommendations and coaching for your situation that's gonna help you free up more money and work the plan faster. I mean, it's like having one of us walk with you every single day and showing you the next right step and holding you accountable. So start EveryDollar for free by downloading it in the App Store or Google Play. All right, let's head over to Jessica, and she's in Savannah, Georgia. Hi, Jessica, welcome to the show.

Hi, guys, thanks for having me.

Absolutely, how can we help?

So I am coming into a little bit of a bonus here. My husband and I are both military, and I am just wondering what your guys' recommendations are for where I should put put that towards. Um, so we both have a car loan and then we have our house loan, and I'm just wondering if we should put it into that and pay those things off, and then where we should put the extra money after those are paid off. Okay, great.

How much is the bonus going to be?

So the bonus after taxes is probably going to be about, um, $30,000. Okay. And then I'll probably have another $15,000 bonus towards October.

Oh, nice. Are these military bonuses?

Yeah, but it's special. Don't tell anyone.

I won't. I hope you get 5 of them. I hope you get— I hope you— y'all get 50 of them. It's a madness out there. Thank you. Just keep the bonuses rolling. It's my tax dollars. Keep them rolling.

Keep them going. Absolutely.

Um, Jessica, how much is the— how much are the cars? Or how much debt do you guys have on them?

So my car is about $20,000, and then his is about $25,000. Okay. How much do y'all How many do you make a year? A little over 200,000, probably. Okay. 210-ish. Okay.

Can I make a guess?

Yes.

Is either one of these cars either a Jeep of some sort or a Dodge Charger?

Oh, absolutely not. Yeah. All right, dude.

Bucking the trends. Bucking the trends.

Is that a military thing?

All my military buddies, all of them either have a Charger or a Mustang of some sort or a Jeep product of some sort.

You know, I do have to embarrassingly admit that my husband does have a Tacoma, which is, if you know, very common as well.

Hey, you know what though? It's a Toyota product. It will drive till the end of time. I support that.

We love a Toyota truck around here. Yes, yes, yes. For sure. Okay, so the $30,000 would take care of obviously the $20,000 and then take the other car loan down to $15,000. Mm-hmm. And then you said you're going to be getting $15,000 in October. I would love for you guys to start, yeah, so all that to say, yes, I would throw the bonus at the cars, you'll have $15,000 left on the truck or whichever car that is. And I, and yeah, and I would still be working to pay that off. And then the money you get in October, hopefully that car will be, you know, you'll owe, I don't know, $7,000, $8,000 on it, right? If you throw some money at it.

I guess I should say, I should also say we do have about like, I just, you know, we were talking about money last night and I was like, oh my God, we gotta find out where we should put this. But we do have about $50,000 in cash right now too. Oh, good.

Good grief. Lead with that next time, Jessica. She's very in the lead, Jessica.

$50 grand. I'm so sorry.

I just, like, I think it's because we're young enough where I just feel like I don't know exactly where I should put the money into. Like, do I pay off the house that much, although we might move in, you know, a couple, 2 years or so? Um, you know, do I put it into like a TSP? What do we do? But we're already contributing like 27%, and I think he's at like 25% going into TSP.

Okay, let me help you.

I feel like we just accumulate money and don't know where to put it.

Yep, no, no, no, and that's common. Okay, so the Ramsey Baby Steps, when you walk through them, Baby Step 1 is a $1,000 emergency fund, check. Baby Step 2 is get completely out of debt, all your consumer debt, which means you're gonna be selling stuff, working extra, sacrificing any money you have saved, ahem, Jessica, anything that's out there, you throw at your consumer debt to get out of Baby Step 2. And so you guys are at that step, which means you can be done tonight. You can pay both cars off tonight. So you're done. [Speaker] For sure. [Speaker] Yeah, and you'll have $5,000 left of that $50,000. And then when your $30,000 hits, that bonus, you're gonna have $35,000. So then you get to move on to Baby Step 3, which is a fully funded emergency fund of 3 to 6 months of expenses. So you guys are in pretty, you know, stable jobs. Any kids?

You guys have kids? No kids. No kids.

Okay, how much would it take to run your household per month, would you say? How much money do you guys need with no car payments?

Um, $6,000. $6,000.

Okay, so I, I mean, I probably would put you guys at a 3-month— we say 3 to 6 months, but you guys don't have kids, stable jobs. So if you wanted to do a 3-month, you know, you could, which would mean you would need, okay, $18,000 $1,000, okay? Okay. So when you, yeah, when you look at all of that, then what's left, then we need to decide, okay, we have some money left. What do we wanna do with that? So the question is, yeah, do you throw it at the house? Baby Step 4 is 15% of your income into retirement. So I actually would lower some of your, what you guys are putting away down to 15% and throw the rest at the house. Okay. And as you pay it off, it's okay because even if you guys sell it, and move, that you're building in equity at that point as you're paying it down. So you're not losing that money, right? You're just putting it into an asset and paying it down. Do you guys think you really will move though in the next 2 years? Yes. You will, okay. So there, I mean, you could keep it in like an index fund or something right now, or even just a high-yield savings account.

'Cause I am thinking when you guys move, if you had some money saved for a down payment and contingent upon the sale of your house that you have now. True. Would work as well. Yep, so that's probably what I would do, honestly, is I would put the remainder, I would have two separate high-yield savings, okay? One that has the $18,000 in it for your emergency fund, and then open up another and just put some of that cash in there and then look up in two years and just say, okay, when we sell our home in two years, how much equity's gonna be in there, plus how much do you think we can be saving, and altogether, what will that look like to maybe buy something? But then military families, I know, if you guys are jumping around, you're probably gonna wanna rent somewhere. It's a good point.

01:54:23

Sure, sure. I think the other thing is that, like I said, every couple of months, we just all of a sudden feel like we have so much money, so we pay some in the house, some in the cars, and whatevernot. So if the cars are paid off, and then all of a sudden, we have like another $1,000 a month that we're not spending, what would you suggest putting that into? Like, how much do you really put into your house upfront.

Well, if, if, if it was me, I, when I bought my house, I hope I don't move for 10 years. And so I'm gonna put, I'm gonna be more aggressive paying it off. Like my friends in the military, they get moved every 2 to 3 years. Um, one of two things happens. They either barely break even because there hasn't been enough time for the house to appreciate and they still gotta pay realtor fees to exit, or, and you know, you've got friends like like this, they have this trailing mortgage in like 3 or 4 different states and they're trying to rent 'em out to other military families and it just becomes a nightmare. Right? And so for you, since you know you're gonna be moving in 2 years, I would, I wouldn't, this is just the Delonis. I wouldn't buy a house until I knew I'm gonna be somewhere 5 to 10 years.

I would agree with that, Jessica.

Otherwise I would rent and I would rent a nice place cuz y'all are doing really well and I would put all that cash in a high yield savings account for the day we can walk in and pay cash for the house we're gonna live in for 5 or 10 years.

For sure, yeah. When do you think, 'cause the difference on, and I'm with John, I'd be renting. So any money you get from equity, I would put into a high yield savings account. The only question I have is our kind of our threshold of investing, which means like putting it like an index fund or something versus high yield savings is about that 4 to 5 year mark. So if you're not going to be buying anything, because you guys are gonna be moving around and renting for, if you're not gonna be buying anything for the next 5 years, I almost would just open up an index fund and start throwing cash in there. And because that you're gonna get great returns on that. And you're gonna be able to ride out the market 'cause you don't need it for 5 years or more. Honestly, that's probably what I would do. And then unless you guys think, no, we're probably gonna step out of the military in 2 to 3 years, 3 years, you know, and buy something then. Okay, okay.

Yeah, well, I appreciate that information so much. The index fund is different than the, like, Vanguard, Fidelity, S&P 500, correct? No, uh, all in there.

Yep, yeah, yep. So just look into that. Yes, yeah, yeah. You may open up like a brokerage account and inside of that put, um, an index fund.

Here's the main thing we're doing differently than what y'all are doing. Y'all get a big check and y'all try to spread it out all over the place. We want you to knock things out one at a time so you actually make progress.

Alright, let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates, but when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey Trusted Agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back from the first from first call to closing day. Find a Ramsey Trusted Agent near you at ramseysolutions.com/agent. That's ramseysolutions.com/agent.

Our Scripture of the Day comes from 2 Corinthians 9:8, "And God is able to bless you abundantly so that in all things, at all times, having all that you need, you will abound in every good work." Dolly Parton said, love her, "A peacock that rests on his tail feathers is just another turkey." Did you see she came out with a video? No, what is it? Are you a big Dolly fan? She had to cancel, Vegas, and that she's having some health stuff, but her doctors, you know, she's, she's going to be great and she's going to be looking younger than ever. I mean, she's just hilarious.

I love— you know, over here on 12 South, like right in the middle of like where all these shops and restaurants are, my kids and I walked by there a thousand times. That's her place. I had no idea.

There? And she lives in— she has—

that's where she stores her bus and all. Oh, okay.

Yeah, cuz her house, y'all, she, she lives like a mile from me. Wow. And she's been there for since like the '90s Forever. She's just awesome. We love Dolly. She's the best. She is. She's a gem. She's the best. She's on my bucket list to meet. I want to meet her.

I just want her to be president.

Oh, she should be president. Dolly. I'm going to write her in next election.

She's probably too young, but—

All right, we're going to go to the phones and we have Richard in Tennessee up next. Hi, Richard. Welcome to the show.

Hey, thanks for having me. Absolutely.

Time. Absolutely, how can we help?

What's up, man? Uh, so I've recently became disabled and I'm not able to provide like I've been doing for my family, and I'm going to be getting a pretty large settlement, about $75,000 minimum. I'm just wondering what can I do to turn that into some type of profit? What happened, brother? I was involved in a car accident, uh, that left me paralyzed. Um, oh my God, I have a head injury, and I have seizures pretty bad from it now. Yeah. Oh, Richard, I'm sorry. I was a truck driver before that, so obviously I'm not allowed to drive, so can't do that anymore. Yeah.

Um, $75,000 seems awfully low for, for, for an injury that takes— permanently takes away your line of work.

Yeah, that's, uh, the lawyer really feels that he's going to get a lot more. Yeah, it's just he said we're going to cover your medical bills at least, and those are all paid. So now I know for a fact I'm going to get at least $75,000. What's he saying? He said you may—

we may be getting more. What does that mean? Like, if he had a ballpark, what was he— I know you're probably being conservative with the $75,000, but what could it be?

I'm trying to be conservative with it, but I mean, he said that he's pushing them and he's trying to push closer to $200,000. Yeah, I, I, I—

for whatever it's worth, man, because this injury takes away your livelihood, which is trying truck driving, I would push pretty hard to expand that as far as possible for future earnings, but that's not why you're calling. So, but man, I hate this for you and your family.

I know, I'm so sorry. Richard, are you able to do any level of other work or will you be out of the workforce for the foreseeable future?

Right now it's kind of too early to tell. Okay. The doctor's not really saying anything positive or negative, so I think they're kind of questioning it too. Okay.

Is it classified as a TBI, traumatic brain injury? Yeah, it is. Okay. Yeah. I'm sorry. The path back from those is so difficult to navigate, right? Because— I don't know. Yeah. I'm glad the doctors are just keeping it neutral because nobody knows, right? Yeah. Does your wife work?

Yeah. No, she doesn't. She's having to be a full-time caregiver for me because I have to be monitored 24/7.

Okay. Are you— do you guys have kids? We have one kid. You have one. Okay. Okay, how old? She is 5. She's 5, okay. And so she'll probably be in school next year, I'm assuming kindergarten? Yeah. Starting in the fall, okay. 'Cause I'm just trying to think how to make this money work for you guys, but also that it doesn't just disappear in expenses when there could be pairing with some level of work or income coming in, you know what I mean?

Well, there's two, I wanna say this, there's two, one of my oldest, closest friends on the planet, Planet is a longtime TBI survivor, and there is a program. I, I know it's a federal program. I think it's a federal program and possibly a state program too, where she might actually receive compensation for your care. And so I would look at that, and I'd also look at your Social Security benefits, SSI benefits.

Okay. Yeah, I did get— I'm on SSDI.

Okay. And what does that pay every month?

Uh, $1,678 a month. Okay.

Yeah, it's not, it's not gonna keep food on your table, but it's something. But check in, have her look into the program that she can qualify as. Um, basically she'll get paid as a full-time caretaker of you. And that's a pretty remarkable program as well. It's not gonna, it's not gonna make anybody rich, but it will keep your house over your head.

Yeah. How are you guys, um, paying for things now, your bills and everything?

So right now we're on just full government assistance, pretty much.

Okay. So do you guys have any debt?

I think, uh, we have $8,000 in debt.

Okay, what is that?

What kind of debt? Uh, that's from a car that I had to turn back in after my accident.

Oh geez, they didn't just take it?

Uh, they were kind of like threatening going, and I just said, you know, there's really nothing we can do, so just come get it. I got a voluntary repo on my credit report.

Shoot. Okay, um, so for now, that— how— when will you get the settlement? Do you know? Uh, end of this year. Okay, so you guys have the rest of this calendar year to survive? Yeah, we do. Okay, and government assistance, what's coming in a month with that?

Uh, just the 1678, and then, uh, the health insurance is locally covered now, and then the food stamps for the kid. So after we pay all of our bills, we're left with about $300, and that's after putting some in savings.

How much are you putting in savings? About 15%, which comes out, uh, of the, of the $1,600. Okay, so it's like $200 or something? Yeah. Okay, and when you say you have $300 left, is that after food, rent is paid, everything? Everything. Okay, okay, and you're putting some in savings. So you could put $500 a month in savings right now is kind of what you're looking at if $300 is your margin.

Yeah, we could.

Okay, you know what, I mean, honestly, Richard, I would probably, I would stick to that regimen as much as you can until you get this payment. And I'm praying by the end of the year, you'll have some answers with your health, possibly freeing up your wife to a degree to be able to go and provide and work if you can't. 'Cause the goal would be to be bringing in some level of income and that this settlement is put aside and that you guys can use it if you need to on a big purchase, like if you have to replace a car, but that it's invested and it is making money. So, in that case, yes, I would put that settlement, I would take some out and put an emergency fund to the side in a high-yield savings account. And then beyond that, again, try not to live off of this, 'cause the goal would be to invest it and just let it grow. And so you can do that just like in an index fund, or something. But between now and the end of the year, my goal would be to be putting some money in savings and start building that up.

Because if you guys can do that, that's pretty remarkable. I mean, if you're able to put, you know, $500 away, I mean, you'll have $3,000, $4,000 by the end of the year, which is fantastic.

Yeah, y'all are living lean for sure. And I hope that it's 10x your settlement than what you think it's gonna be. For sure.

Which I feel like it should be.

Yeah, ask some questions to your attorney about future earnings.

Yep, and just, yeah, ask about that. But yeah, when you're in a position, which I feel like we've had a couple of, not just like this call, but the idea that it's like, it is just, it is touch and go month to month on bills and cash flow. Remember you guys, food, shelter, utilities, transportation before even debt is paid, take care of that. And then beyond that, make a list of priorities of things that you, you have to have, right? And if you have kids, young kids, but you're both working, daycare, it's gonna be right there close to that needs line, insurance. Like there are some things that have to be covered. But the idea is that you, you have a plan and it's written out and you're able to follow it because that logic side is so important when emotions and the scariness of reality can wash over you and you can make bad decisions. Options if you focus on that.

Yeah, and there's not a way to take $75,000 and turn it into, like, invest off of it and make that into a livable income per year forever. The best thing you can do is to take that money and like Rachel said, get an emergency fund, but put the rest of it in and you're thinking way down the road with that money.

Yep, absolutely.

Sorry, brother.

I know, I'm so sorry, Richard. Call us back if you need more help, for sure. For you. Thanks to everyone in the booth. Jon, always a fun show. And thanks to everyone listening. And remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.