Transcript of Don’t Let Your Emotions Drive Your Financial Choices New

Brought to you by the EveryDollar app. Start budgeting for free today. 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. I'm Dave Ramsey, your host. Dr. John Delony, Ramsey personality, number one bestselling author, host of The Dr. John Delony Show, my co-host today. Open phones here at 888-825-5225. Jackson, New York. Hi, Jack, how are you?

I'm doing very well. How are you, Dave?

Better than I deserve. How can we help today?

Oh, hope you can help me. Uh, my mother, after Dad died, went on a series of cruises, and as you may or may not know, on cruise ships they have art auctions where basically you're buying overpriced art after you've had a few drinks and everything. And my mother on a series of 6 cruises spent $1.1 million on cruise ship art. Um, you can't get into her house. There's so much cruise ship art in the bedrooms and everything. Uh, my brother and I are trying to sell it at auctions and stuff. We're only getting 10 cents or 20 cents on the dollar. And I know you good folks have seen it all. I thought maybe you could give me a suggestion or something.

This is a new one for me, Jack. Well done, brother.

Wow, wow, that's, uh, that's disturbing. Yeah. So how many cruises?

I believe 6 or 7 cruises, and she kept it from the family.

I mean, like, you guys, you guys didn't go inside of her house for 6 or 8 months?

Oh no, we would go in and we saw some art there, but she had it in the garage. And after time went on, it got worse and worse. So we did see some of it when we went into her house and we said, okay, mom's spending 5 or 6 grand. She's worth a lot of money, wants to have a little fun. Then she just kept doing it and we kept trying to get her to stop, but she would just disappear and go on cruise ships and keep buying all this stuff.

Is she, is she, is she broke now?

Uh, good question. She has, um, she's living comfortably as opposed to super comfortably. So she's getting by. She's not worried. We're not worried where next meal's coming from. But the little extras, that's where she's struggling with.

Yeah, we're not— there's not another million dollars to buy art with.

No, thank goodness. No, there is not.

Does she recognize she has a problem?

She did towards the very end, and we had no idea she was spending that kind of money. Again, we thought, it's not good, it's sloppy, but she saved all her life. She was a use the same tea bag twice type of person. And she just— I think she lived with her parents, got married to my father. Who would have squashed it in 2 seconds.

How long—

he passed away—

how long after he passed did this go on?

It started about, oh, I'd say a year and a half to 2 years after he died.

So this was her wicked weird way of grieving. Wow, man, I'm sorry. I, I, um, you know, I, I've been on cruise ships, I've seen those, uh, art auctions. I purchased precisely $0 in that stuff. I'm not an art critic. I don't know anything about art, nor would I know where to move it. You know what I would do is this: is she mentally incompetent or just was just dumb?

Uh, I think she was just dumb. She had like, uh, it's almost like her—

because otherwise she— I mean, like, if she met with her medical doctor, he would say she was in her right mind, she was just grieving in a very inappropriate way.

Uh, well, she was remarried at the time.

Um, where did he go?

But he just didn't do anything. Uh, he just didn't do anything. He's kind of, uh, he's kind of not the type of guy that would tell her what to do. And keep in mind, that was her money. My father— it was their money together.

Yeah, I I got that. But still, yeah, I mean, if you love somebody and they're doing something stupid, you stand between them and stupid. But, um, so Bozo has no backbone. Um, all right, the only thing I— that pops into my head, and I have no idea, is if I were you guys, I would get in touch, uh, with the, uh, cruise line and try to work your way into the publicity side of the cruise line or the customer service side of the cruise line and say, um, you know, Here's what has happened on your cruise line. Was it all on one line?

Um, I think so. Yeah, but it's the same company.

Yeah. And I would just say, here's what's happened on the line. So we have a widow here that you all accidentally took extreme advantage of. We're not saying there was malicious intent on the part of the cruise, but the cruise just took $1 million from her for art that's not worth $1 million, and we're going to ask you to buy it back and put it on the cruise ship and resell it and make your money back as a PR decision.

Okay.

Because you don't really want me telling the whole world on social media that your cruise line took $1 million from a widow, and I'm getting ready to. And I honestly don't think you guys did it on purpose, but I do think you need to do something about it because you should have had some kind of checks and balances in place because you've got widows and old people cruising with you every day. And if you guys are taking advantage of the other people at this level, even if you don't mean to, you should stop it. It's wrong. And so like, if my company had done this accidentally, we would probably consider at least at some percentage, 50% or something, taking the inventory back in and trying to help the lady out because obviously she's out of control and we were contributing, not knowing it, but we were contributing. If my company did that.

Or one thing about our company is we want people to be better off after they've been with us than before. And if we find out somebody was exponentially worse off, right?

Yeah, we would try to help fix that. But, and I do honestly, You know, it's not like it's a gambling thing. So if it's a gambling thing and your name shows up on the watch list of problem gambler, they shut you down and keep you from gambling. But they don't have that for art auctions.

Especially on cruise ships, right?

So there's no way to— there's no database that they should have been accessing to protect them. I mean, it's just a customer. They got millions of customers, and this customer just liked art, or cruise ship art in particular.

But also wasn't well or healthy at the time.

Yeah. I'm going to ask for some mercy from them and some help.

That's it. Some help.

And I'm not going to do it with accusing you guys of having done something wrong, but I am going to say the net result is you caused something wrong to happen and we're going to ask for some help.

Yeah.

If she—

it's a new wrinkle that she's remarried. If she wasn't married, I would, Jack, I would get with you and your siblings and sit down with mom and say, we would like to take ownership of your finances. We want to help out from here on out, and we'll make sure you got a roof over your head. We'll make sure this money is managed well. It's complicated now that she's got a new spouse, that they may want to co-manage that together or whatever, but I would sit down and at least offer the help you can.

I've never— I mean, I've heard, uh, I've never heard this one. I've seen hundreds of thousands of dollars on, uh, Shopping Network.

Sure.

Oh yeah, seeing that they're sitting lonely.

Yeah.

And just keep calling so they can talk to somebody and buying whatever stuff. They got a basement full of stuff they don't need. I've seen that multiple times over the years. The art auction on the cruise ship, this is the first one. First one, 35 years. You got to have a new one every day.

You know, when I became a dad, something flipped. Suddenly it wasn't just about me and my wife anymore. It was, what happens to my family if I'm not here tomorrow? And things like that just hit different when you become a parent. But I'll be honest, making a will feels heavy and complicated, and it's not exactly what I want to be doing with my time off. But here's the deal. Being a parent means doing the hard stuff, especially stuff that protects your family. And that's why I use Mama Bear Legal Forms. No hassle, no lawyers, just a simple online tool that helped me create a legit will in about 20 minutes. So it was pretty much painless. Plus, I added a notch to my dad belt right there between installing car seats and bedtime stories. Listen, being a dad never stops, and making a will is how you make sure your family's covered even when you're not there. So get your will done today at mamabearlegalforms.com and use the promo code RAMSEY to save 20% off when you check out. Again, that's mamabearlegalforms.com, promo code RAMSEY.

Heidi's in San Antonio. Hi, Heidi, how are you?

Hi, doing well. Thank you for taking my call.

Sure, what's up?

Uh, well, we are done with Baby Steps 1, 2, and 6, and we've been done with those for more than 4 years now. Plus we have about 3 months saved for an emergency fund. But for the last 4 years, we've been stuck and not able to save at all and don't really see any possibilities of moving on to Step 4 until our kids are out of the house, which is at least 8, 9 years away.

You don't have a payment in the world No. And you're stuck.

Yes, sir.

Where's all the money going?

Well, we don't have a mortgage, but you can call paying for our two kids' private school a mortgage because it is almost a fourth of our take-home pay.

Well, that's where it is.

Yeah, that's where that is.

And I mean, what is your household income?

Monthly?

Annually, monthly, I don't care. Um, well, annually we have about just about $100,000 and $25,000 is going to private schools, which leaves $75,000 with no payments.

Correct.

Minus food and lights and property taxes.

Yeah. And a lot of gas. We live about 35 minutes from anything. So we spend a lot of money on gas.

Not that much gas. There's not $70,000 worth of gas.

Yeah. Where's it going for real? Do y'all budget it out?

Uh, yes sir, we do. Um, we did the FPU about 10 years ago and so we're not using the app, but I do on our computer a monthly budget., and we pretty much stick to it. Besides, we have had some medical bills that we've had to pay, um, and yeah, so I would say probably over $500, $600 a month, probably more than that, we're paying towards, um, medical things.

Who's ill?

Uh, I am. I, I have Lyme, and also my husband. We've had all kinds of things. He I had to have surgery and missed out on 2 months of work this year. So that, um, that's this year.

What, what, tell me about the private schools, because $25,000 for 2 private school tuitions, either that's very inexpensive private schools or that's not the real number. Is it more than $25,000 a year?

Well, we have a partial tuition grant, so, um, right now We're paying about— when I said a quarter of, it's a quarter of our take-home pay besides, you know, whatever's taken out of the paycheck, which includes some dental and that kind of thing. But we're paying right now $1,400 a month for both of the girls to go.

And you have— but because you've got some kind of a subsidy, is that what you're saying?

Oh, yes, sir. Yes, sir.

Okay.

We have a little bit of a grant.

Just that the math isn't mathing for me, and it may be me, but I can't make the numbers work.

$100,000 is $8,300 a month. So you should be taking home right around $7,000, $6,500 to $7,000, not counting health insurance and not counting 401. Are you putting money in 401?

No, sir, we're not.

We're taking home, um, What are you getting home with? $6,500? $7,000?

Um, about $6,600.

Okay, good guess, Dave. And, um, yep, so, uh, minus $1,400, right?

Yes, sir.

That's minus food and lights and car gasoline for a 35-mile drive.

So let's say that's $2,000 a month.

There's still thousands of dollars missing in this discussion.

Um, well, I can give you some of our biggest line items. Um, you know, we do tithe every month. We've got our— we set aside for property taxes. Uh, we got our— we do, um, a medical needs sharing ministry, which is— that's about $800 a month.

Um, so you don't— you're not purchasing health insurance at work then?

Correct.

Okay.

All right.

No problem with any of that. That still doesn't get you there.

Yeah, well, we can add in, um, some of our other items, uh, like you said, like electricity, homeowner's insurance, internet, phone. Um, like I said, we don't eat out. I'm looking down our budget to see some of our bigger line items. I mentioned the medical staff.

Why have you— I'm not debating it, but since the largest item in the budget so far is still what you started with and what you led with, and that's private schools, why have you made the decision for private schools?

We really enjoy and value the education that our girls are getting at the school where they go.

I totally support that, but could they each not earn $700 a month?

Is that— well, they're 9 and 13, so—

oh, I thought you said the kids were out of the house. I'm sorry.

Oh no, no, no. I said that.

So you value the education, the quality of the education, or the content of the education?

Both.

Both. It's a very good school, and I— we see the way the seniors turn out when they leave the school, and, um, And they have a really good, uh, portrait of a senior there.

So the thing you have to own is you're making a values-based decision on, we want our kids to maybe look like this kind of senior someday, and we want to have no retirement and we want to have no savings. I mean, at some point there's a math problem and it's, it's a very uncomfortable decision. To look at, hey, we don't wanna buy insurance through our business. We want to do this ministry sharing program. Okay. That's a choice you can make. All of these things here are choices. We wanna drive an F-250 instead of a Prius. Like all these things are choices. We wanna live way out in the country. And cuz we like that life instead of selling our house and maybe moving closer to town. All of these things at some point, medical's not a choice, food, It sounds like it's not a choice. Y'all aren't extravagant, but these other things are choices.

And I'm still not finding it all.

I'm not either. But you have to balance. We're choosing this over this. I think, Dave, one of the illusions is I should be able to do everything I want regardless of how much money I've got in front of me. And it's just not the way it works. It's just not. It's just not. I say this with all of the grace possible.

Can you imagine where she would be If they had 2 car payments, a student loan, and a MasterCard payment like most people—

Correct, yeah.

They would be bankrupt?

Yeah, they'd be over. It'd be over.

And they make $100,000 a year?

Right.

See, that's what doesn't compute.

Yeah.

There's something off. So, yeah, I think you guys are making choices, but there's also some kind of a mystery here in the budget, and I would want you to sit down with your spouse and the 2 of you look at this budget very, very carefully and say, Okay, we're starting with $8,333 a month, that's $100,000 a year minus taxes, we're getting home with $6,600. And then after we pay property tax and lights and water and food and transportation, here's what we have left and here's what we're choosing to do with what we have left. And is that what we want to choose?

Is that what we want to choose?

And that's what you've got to decide. So I don't hear extravagance.

No.

I just can't fill up all the $1,000 holes I have in the math while I'm working with you here. I can't get there. I got $6,600 minus $1,400 minus property taxes minus, you know, food and lights and water and minus $800 minus a tithe of $660. And, you know, and so— or maybe you're tithing on the gross, $830. Okay, either one, still not there. I'm still not down to zero. And I don't hear massive amounts of waste or something. I just don't know what it's going to. And Usually when I'm having these discussions, I can keep talking and all of a sudden a $1,200 car payment appears and I know what's going on. But I've not found that in this discussion. So I can't, I'm sorry I wasn't able to be more help. But that's the thoughts I have on what you guys are facing, Heidi. I would dig further into it and then as John said, consciously make the choices. There's a thing called opportunity cost on money. By choosing to do A, I am simultaneously choosing to not do B and C.

And own that choice.

Yeah.

It's not happening to you. It's a choice you're making in the affirmative.

If you're waiting for the perfect interest rate before you buy a home or refinance, that moment may never come. That's why people should talk to Churchill Mortgage, because rates move every day, and when rates drop, buyers flood the market, which means more competition and higher home prices. Smart buyers know they can't time the market. They move with a strategy. Buy the home you can afford now and refinance later if rates improve. Churchill helps you understand what you can actually afford, not just what you qualify for. And with their Certified Homebuyer Program, you can get fully underwritten before you shop so you can make moves faster and make stronger offers. And right now, Churchill has a special offer only for the Ramsey audience. Go to churchillmortgage.com/ramseyoffer to learn more. That's a special website. Remember this, churchillmortgage.com/ramseyoffer. /ramseyoffer.

This is a paid advertisement. The Churchill Certified Homebuyer Program is available for qualifying borrowers and select loan types only. NMLS ID 1591, NMLSConsumerAccess.org, equal housing lender, 1749 Mallory Lane, Suite 100, Brentwood, Tennessee 37027.

Well, if you want to work the Ramsey Plan and you want to follow the Baby Steps and you want to move out of debt and into wealth, the easiest, fastest way to do it is by putting together a plan on EveryDollar. The EveryDollar app will make you accountable for every dollar every month, and you'll place those dollars with personal coaching, customized plans, exactly where they need to be placed on the Baby Steps to get you out of debt the fastest, and into wealth the fastest. Download it for free on the App Store or Google Play. EveryDollar. Jordan is in Houston. Hey Jordan, how are you?

I'm doing well. How are you guys doing?

Better than I deserve. How can we help?

So my, uh, me and my wife, we got married a year and a half ago, and her parents very generously paid for the wedding. Um, but a kind of a piece of fine print that I was unaware of when they offered to do that was that any dollar that we spent above what they had allotted, we would owe back to them. And so, and I was essentially uninvolved with the planning of the wedding and wasn't aware of that. And so pretty quickly after we got married, we got a bill sent to us for a few thousand dollars that, you know, they've told us, hey, there's no interest on it, pay it back when you can. Um, but as we're starting to, we, we recently purchased a car in cash from a member of my family, which has kind of resurfaced this conversation with my wife of what's our plan for paying this off. And, uh, her parents have had a lot of conversations with her about it, uh, but never with me. And so I was just going to ask for help how to move forward with this.

You said it was in the fine print, so did your wife know?

Mhm. Uh, she did know.

Okay, then pay it off. Stop the conversation and pay it off today.

Okay.

Like, you're— it's costing y'all mental calories. It's going to cost you a relationship. And like, I can sit here all day and pontificate, like, man, not— that was not cool to get a bill from your— but that was the— that was the handshake agreement they made with their daughter.

How much is it? Yeah, how much did she— how much did your wife go over budget on your wedding?

A little over $4,000.

Okay, and you paid how much so far?

A few hundred, maybe $500.

And what's your household income?

$140,000.

Okay, so write them a check today.

Cool.

Your wife made her parents a promise, and lesson learned, we don't do any deals that we don't both know about. Yeah, ever. Particularly with your freaking parents who are Pharisees. Got it? No more money deals with your parents, honey, ever.

Word.

Yeah, because this is, this is awkward, strange, weird.

But she did the deal, write the check, and it may be her parents are struggling and they stretched and did whatever, and yeah.

They're just weird.

It's $4,000. Who sends a bill to their kid for $4,000? I mean, I know, I know, I'm trying to be generous. I'm not. I've done— we've had 3 of them get married and the budgets were horrendous and they stuck to their budgets and we laid out the budget ahead of time. We agreed to fund it and if it went over that, they came out of their pocket with it. We didn't come out of our pocket. They didn't go over. They stuck to the budget. It was generous. They had a great wedding. We had big parties.

We loved doing it.

I love big parties. I love weddings and babies and grandkids and all the things that happen when you have weddings. It's all awesome. Go do all of it. But parents, seriously, and kids, don't make a deal like this and not tell your spouse, your fiancée. Oh, I promised my dad $40,000 back. Oops, I forgot to tell you. Thank God he's only 4.

Right. And you make $140 grand, right? The check today.

Yeah.

Say sorry it took so long.

Not worth it.

It'll never happen again.

And I promise you'll never happen again because we will do no more money deals with you people ever.

Yes.

Because you didn't bother to include me and you should have in that discussion. That's the parent. That's on the parents.

You think so?

I think it's on the wife.

Absolutely. They should have included her. I promise you, if I'm looking at Rachel Cruz going, if you go over this, you got to pay, I'm going to look at Winston and say, and oh, by the way, if she's going to be your problem, that's fair.

It's going to be y'all's problem.

Man up, right? I did tell him that, but it wasn't about money. Yeah, Winston, she's going to be your problem now. He reminds me of that occasionally.

Yeah, sometimes Winston's sitting on my front porch and he's like, man, it's my problem.

I'm going to see Dr. Deloney. Randy's in Shreveport. What's up, Randy?

Uh, doing good, doing good. How are you, Dave?

Better than I deserve. What's up?

Okay, so give you kind of a backdrop. So I retired last year in March at the age of 63, and my mother passed away in May of that same year.

Oh, man.

And she willed— she willed her farm to me and my sister. There are no other names within that will other than my sisters and mine. Um, so now I'm just, just beginning to get on Social Security. She's been on Social Security for a long time, and with the earnings cap and IRMAA and everything else, how do we— can we secure the farm in a trust so that we don't get hit with capital gain tax?

Are you going to sell it?

Um, more than likely, yes. Okay.

Well, your basis in the property is its market value at the time your mother passed away. One year ago. Okay.

Okay.

So what was the farm worth a year ago?

Okay. So the farm was recently reappraised by the county.

Now the county doesn't count.

At the time she—

What do you think? What do you think the farm is really worth? The county's a tax assessment. That's not an actual value. That's just assessment for taxes. It's not an appraisal. What do you think if you were going to put it on the market? What would you put it on the market for?

Uh, probably around $1 million.

Okay. Was it worth more than $1 million last year when she passed? Probably not.

Probably not.

Yeah, probably wasn't. It wasn't worth $700,000 and went up $300,000 in one year, right?

Yeah, actually the appraisal went from $300,000 to $700,000 in one year.

That's the tax assessment.

That's not the real estate market.

That is not a real appraisal. Hear me, okay? Your tax assessor does not give you accurate values. Zillow does not give you accurate values. You have to get an actual appraisal on the property, and, and you could do that based on a year ago. So here's the thing. Let's pretend for a second that the farm a year ago was worth $1 million, and the farm today is worth $1 million, and you sell it for $1 million. You have zero taxes. You've had no gain because your basis in the property for purposes of calculating capital gains, and the gain is over the, the amount over the basis. Your basis is the value, the market value, not the tax assessor, not Zillow, the real appraisal at the time of death. And it's only been 1 year, and it's a farm in Louisiana, it's probably not gone up in value hardly at all in 1 year. Maybe a little bit, but not much. And if it did, it's probably gonna get eaten up with selling cost anyway. So you need to see your tax professional, and if you don't have one, just go to RamseySolutions.com. And what I would do is sell it, and I would claim that it was sold for market value and there was zero gain.

If you're ever audited, you'd have to go back and have an appraisal done at the time of death and compare that to the actual sale price to prove that there was no actual gain. But I don't think you have any gain. If you had $100,000 gain, it's only $15,000 worth of taxes. It's not that big a deal.

And I, this is news to me. I'm glad you're teaching me this. So if she had sold that farm right before she passed, she would've had to pay taxes, capital gains on all the growth from when she got it.

Exactly.

But if she held onto it and passed it.

It's step, it's called a stepped-up basis.

Okay.

So you, you, when you inherit a capital asset, stock, property, anything else, the basis goes from mom's old basis. To zero. Was, uh, all the way up to market value basis. And if so, if you sell a stock, you know, Grandpa left me a million dollars in Exxon stock and he had only $20,000 in it, you pay zero tax if you sell it within a few months of Grandpa's death.

Wow.

Huh.

Okay guys, let me ask you something. What would it take for you to switch your bank? Because if you're still earning next to nothing on your savings, you need to check out Fairwinds Credit Union. And I know what you're thinking, it might sound like a hassle. Moving your direct deposit, updating bills, getting a new debit card feels like a lot. But here's what most people don't realize. Staying where you are could be costing you hundreds of dollars every year. Y'all, the average savings account pays less than half a percent. So let's say, for example, you got $20,000 saved. You might earn around $70 $50 a year. But with a Fairwinds High Yield Savings Account earning 3% APY or more, that same money could earn you over $600. And that's real money that you can use towards the Baby Steps. So don't let temporary comfort keep you stuck. Check out the Smart Bundle from Fairwinds Credit Union. You get a High Yield Savings Account, a no-fee checking account, and the Ramsey Be Weird debit card. Go to fairwinds.org/ramsey to learn more and make the switch today. That's fairwinds.org/ramsey. Insured by the NCUA.

Jane is in North Carolina. Hi, Jane, how are you? Well, let's try again. Hey, Jane, how are you?

I'm doing good. Hi, good.

What's up?

What's up?

Hey, so my question today is, how do you decide when it's worth spending money to improve your quality of life versus staying in a situation that helps you reach your financial goals faster? Um, so my boyfriend and I are credit debt— our credit card debt free. Been working on that for a while, and now we're trying to save for our future, and we currently live at his mother's beach house. Um, originally we were supposed to stay there for free while we paid off debt and saved, but his father passed away and we started paying the mortgage instead. Um, the payment's pretty reasonable. We could probably pay about the same to rent elsewhere, but the problem is, is it's a revolving door. It's constant— family is coming down to visit. It does not feel like home, and I'm over it. Um, so to move out to a rental, we have to spend thousands on deposits, moving costs, which feels like setting our goals back. But so financially it's smarter to stay, but emotionally I want out.

You sound like someone that's married, but you're not.

Yeah.

Yeah. And we're talking marriage. It's, it's really tough. We've been in a very like debt, paying off debt mindset.

We don't need to be doing anything. We aren't married.

Yeah, like, this is a weird thing. You've locked yourself in a cage, but the lock is on the inside.

Yeah, like, we don't need to be paying off debt. You need to be paying off your debt. He needs to be paying off his debt.

And you don't need to be putting up with his family and his drama. And like, you get what I'm saying?

We aren't married. You have a roommate.

Yeah, and his family—

and his family comes to visit all the time. Morally, you have a roommate.

Yeah, but okay, and I agree, and you know, we're moving towards marriage. It's just, it's hard to, it's hard to even comprehend a wedding or like a ring or anything when we've been like, you know, we just paid off $30,000 in debt and we have our $1,000 saved, which just—

we don't— you don't understand, honey. You're not married. You don't have anything.

Here's the other side of this.

You have a boat. You have a Hey, you're paying off debt with your roommate. You are so vulnerable and so unaware of how vulnerable you are in this situation.

That's it.

He just pulls up stakes and leaves. You know what? You are screwed.

Yeah.

Or if he says, this is my family's house, I'm never going to leave. I don't care how you feel.

Or, babe, yeah, get out and you're screwed. You've been paying off his credit card debt, calling it we. Ain't no we.

You've been paying down his family's beach house. Mortgage. Yeah, you have nothing.

So he— so, okay, and this is the way we set it up. So he pays for all of our living expenses, including the mortgage and all of that, and I pay the debt.

His debt.

His debt.

You're paying your roommate's debt while he pays his mother's mortgage.

You are so exposed right now. That's what I'm trying to say. Like, okay, and you're really in a very comfortable—

and you really think I've lost my mind when you have What do you recommend that I do? I recommend y'all quit acting like a we unless you get married this weekend.

I'm dead serious.

You are so vulnerable, honey. You're scaring me to death for you. If you were my niece, I'd come get you out of that house and tell you to put Bozo on the street till he puts a ring on it. Uh, you are so vulnerable. You think about how much money of his debt have you paid off?

Um, well, I'd say we were about like 50/50. We had about $30,000, um, like 15, you know, rough numbers, 15 of that being mine, 15 of that being his.

Okay, and he puts you on the street, you know what you get? Nothing, honey.

Zero. Yeah, zero.

You catching? This is, this is vulnerable.

And listen, Dave and I would not have jobs if everyone's magical plans always worked out. Yeah, you know what I mean? And so I, I don't want to wish y'all ill. I hope it all works out. I hope he marries you this weekend. That'd be awesome. But I only have a job because it never works out like that. Or that's not true, it, it sometimes does, but it often doesn't.

Well, yeah, all the times that it doesn't is why we get to do what we do, which is sad for us.

Yeah.

And people that we love, like you, we, we're scared for you. And so Um, yeah, so what you all need to do is you need to have different, uh, housing arrangements, and you need to separate everything in your lives until you're married, because you're completely vulnerable.

So you think I should move out?

Yes.

Yes.

Here's why. You started this call by saying, I can't do this anymore.

Yeah. And guess what? He didn't call. You did. Yeah.

Yeah.

Like you calling and telling two guys who care about you, hey, I'm not okay. And the man who says, I want to spend my life with you, we'll just do it later, doesn't have that same care for you. That's a flag for me. That's a big red flag for me.

Yeah. And, you know, so even if you're going to shack up, folks, keep everything separate. Don't sign leases together. Don't buy cars together. Don't pay each other's bills. I mean, just decide who's gonna buy the mustard. That's it. You know, okay, the lunch meat's mine, the mustard's yours. We'll share that, okay? But I mean, but everything, you know, do not get on these deals together because the number of times someone has called in here and said, oh well, you know, I can't find my old boyfriend that I used to live with after I bought him a car and I'm on the note and the note's in my name and the car's in my name, but I can't find him or the car.

Or I paid off all of his debt and then "and he left me.

How do I get that money back?" "I got pregnant and he didn't like that, so he left me with a kid." Oh, that one we get all the time.

Right.

Yeah.

You are so vulnerable. Yeah. Y'all are just acting like you're married. You're not married. And so legally and relationally, you're not prepared to be married, but you're paying his debt. I mean, this— when you just say this out loud, it sounds cray-cray.

Right.

Right.

And, and to answer your bigger question, multiple times, and me and my wife working to get outta debt, we took steps backwards for not debt-wise, but we did say, hey, we need to move to this place and here's what that cost is gonna be and here's what the ROI on that move's gonna be. We did actually do that twice. And so I, I didn't see that as a step back. I took that, I saw that as a necessary move to get us where we wanted to go.

Right.

So sometimes that's part of it.

Yeah.

So this, the speech house didn't, if, if you were married and you called with the exact same call, the speech house didn't turn turn out like as promised.

Yeah.

Because sadly, he lost his dad. Yeah. And so now your mom, your mother-in-law, your future mother-in-law, maybe, is in trouble and probably needs to sell the beach house. Right. Because you guys aren't going to pay the payment anymore. And so she's going to have to, and then all the other people who are coming and visiting all the time are going to have to, and all that stuff. But, you know, the deal changed. And so the deal changed.

Deal changed.

Yeah. So I had a roommate in college named Jeff. We're friends to this day. I talked to him last weekend. I never paid any of his debt.

No.

And I like Jeff.

Yeah.

He's a good guy. I mean, I'm still, like 40 years later, we still talk. I like Jeff. But I never paid any of his debt.

Correct.

This is the rule. Don't pay Jeff's debt. That's the rule.

On your 40th anniversary of Total Money Makeovers, there'll be a new chapter called Don't Pay Jeff's Debt.

That's it. That's what we're gonna call it. And poor Jeff's gonna get thrown under the bus, but I'll call him and tell him to watch for the bus, it's coming. Yeah. So, ah, bus tracks.

I had friends and roommates in college that helped me out when I was in a hard spot, who might cover the rent for a few months, who might be like, dude, I'll— don't pay me back for dinner tonight. That's called being a friend. But we never got into, hey dude, I'm going to buy you a car and I'll just put my name on the note, but you drive it. Just pay me back later.

And you pay the rent and I'll pay for your car.

Yeah. Yeah.

We don't have those discussions with your roommate because you're vulnerable. That's why. But when you're married, the law says everything is combined.

Yeah.

And morally, legally, spiritually, everything's combined. It's ours. We, we, we, we, we, we. But when you're not married, there's no we, we. Yeah, that's not it. It's not happening. You're not French. It's not we, we, we. It's not French. Okay? You're not married. So you guys are getting yourselves in so much trouble, all of you out here doing this. And I know I'm pissing all of you off because you always write all these hate mail to me. Don't You don't tell me I need to be married. Well, then don't listen to the show because I'm going to tell you to be married because it's the best way you end up with a strong net worth and a high quality of life. You live longer, your life is better, kids have better outcomes, everybody involved wins. Let me tell you what I get asked all the time. When should I get term life insurance? How much do I need? Is it affordable? Those are the right questions to be asking. So let's take a quick review. The fact is, term life isn't a baby step. So if anyone is dependent on your income, you need to have 10 to 12 times your income in life insurance now.

And most people are surprised by how affordable term life really is, even if you're not in perfect health. Look, I understand the hesitation since most insurance companies make it more of a hassle than it needs to be. Not at Zander Insurance. They're not an insurance company. They're a broker that works for you. That means they'll shop and compare the top term life companies to find the most competitive options on the coverage for your family. For almost 30 years, I've recommended Zander for straight answers, competitive rates, and coverage that actually protects your family. Call 800-356-4282 or go to zander.com for a quick and easy quote. That's zander.com. Welcome back to the Ramsey Show in the Fairwinds Credit Union studio. Dr. John Delony, Ramsey Personality, is my co-host. Karen is with us in Orlando. Hi Karen, how are you?

Hey, I'm great. Thank you for taking my call. I'm just gonna dive right in. Um, my mom has been in skilled nursing and she's going to need to go into a nursing home, and she doesn't have any assets other than a fully paid-for home. I'm working with an attorney for Medicaid eligibility, and in Florida, certain types of property are not counted towards Medicaid eligibility, including her home. And attorneys have some really unique creative options to protect that asset. My mom has asked me not to let the system take her money and I should do what is best for myself, husband, and little boys. And at the same time, she doesn't have an opinion on what avenue to do for her assets. I would love to hear your perspective on if I should sell her home to pay for her care or do what she asked, which is Medicaid, and I use the asset to do what is best for my family. And then And if the latter, I'm not really sure what would be best from a Ramsey perspective.

Well, you need to understand that Medicaid is welfare.

Yes.

It is nursing home, in this case, provided by the welfare system for people that are poor.

Mm-hmm.

And if you go visit a Medicaid-provided nursing home and you go visit a different nursing home that you might buy with cash, you will see a different experience.

Experience.

Just like if you go visit subsidized housing and welfare or you go visit a private residence, you will experience something different.

Okay.

Right?

I understand.

This is the DMV of nursing homes. And so if you can't do anything but be on the street and it's the only way she can get care because she's poor, that's fine. But if it was my mom? I would use her house money to take care of her at a higher quality of care.

Okay, even, even if it goes against what she's told me to do?

Well, she's, she's under the illusion that the system is taking her money. It's not. If you go to a restaurant and you buy a meal and you give them money, the system didn't take your money. If you go to a nursing home and you give them money to take care of you, the system didn't take your money. You bought a service. The system. And she's also under the illusion that her quality of care at Medicaid is the same level as it is in private care, and it's just not. It's the difference in welfare or not. And so if you go visit these nursing homes, I think you'll come to the same conclusion.

Okay, okay, I got it.

How much is the house worth?

The house is worth about— after realtor, um, and closing fees, will she net about $250,000.

Okay, that's not gonna go a long way. How's her health?

Well, she's 75, so she's in average health. Her challenge is mobility, so she'd probably outlive that.

Mm-hmm.

Okay, is this all she has?

Yeah, this is, this is all she has.

Yeah, so you know, the average nursing home stay once someone goes into full care is 2.5 years. That's the average, which means that some go longer and some go less, obviously, right? And so a lot of people are there 6 months and they're gone. But it's also, in that case, their last stop and their health was already on the decline more than hers. That brings the average down, you follow me? So, you know, you probably have a 3 or a 4-year exposure, something like that, And so that means you've got a maximum of a $70,000 spend per year.

I understand.

Yeah, so go shopping and look at this. The good news is you're in Florida and there is a wide array of options.

Yeah, it's almost overwhelming.

Yeah, is she in need of full-time live-in care?

Um, yes, where she is at right now, there's— she needs 2 people to assist with Yes. Um, even transferring from a bed to a wheelchair or from a wheelchair to the toilet.

Okay.

Yeah.

Yeah. So it's interesting that somehow, and this is just something for you to consider philosophically, and you can mix this in the bucket with my answer, but somehow in your mom's mind and in a lot of people's mind in America, that the nursing home, when I go into a nursing home, they steal my money. Like, "It's the system took my money," was the phrase your mom used. Don't let the system take it all. Okay? As if nursing home care would just appear at the end of a rainbow somehow magically without paying for it. You know? And so it's like any other service. If you want your car to be worked on, you pay the mechanic. If you want someone to provide care in your home or, you know, clean your home for you, your maid service, you pay them. And, um, but the— and no one looks at those people and says the system took my money. But if you own a nursing home, you're evil and you're taking old people's money.

Dave, I— this is just a— just a looney— I have a nagging fear in my spirit. I'm hearing more of these calls where there is this reckoning happening. I'm 71, I'm 72, I'm 81 and I'm staring down the barrel of 10 years, 20 years to go, and I got nowhere to live. Or in this case, I've got family members who they don't want me to move into their back bedroom, but there's none other option. It's either that or a—

or they'll use up $250,000 for care.

Yeah.

Which we're gonna do. Yeah.

But it's a, I just thought this thing would happen.

It's not. Well, it's, you know, yeah, if you got a million dollars in a mutual fund, all of a sudden the problem goes away. In other words, is what you're saying, because you've been investing in your 401 for the last 25 years for this exact moment. Yeah, just so that you can retire and not have to have your daughter have this heart-wrenching decision. Okay, is— am I gonna burn through the $250,000 and she's still alive? That's what's running through her mind right now. Absolutely.

Absolutely.

And so, you know, and so if I do $70,000 a year, I got 3.5 years.

Yeah.

And then we got to look at what we're gonna do. Now you may have to go to Medicaid. Yep. Because you're broke. But that's what I would do. And so, yeah, you're right. If you're 22 and you're listening to this call, you know, this is why you get out of debt and invest money.

Yeah.

So that you've got options. In these situations. You know, we've gone so far. I never even thought about it that much, because in our world, it's almost like assumed that at some point you're gonna spend some time in a nursing home. You know, you kind of think about that. And I never thought about it one way or the other, you know, but now that I'm getting old, it's starting to come to me. I'm 65, so what do I do? And so Sharon and I, we just figured it out. We don't have to go.

Just hire them and bring them.

I got a pile of money. Yeah. So I'm just going to hire like a medical butler, just live with me, move in the spare bedroom. I got a spare bedroom. I got already got one of those beds that leans up, you know. So that's just for the snoring. But the, uh, you know, I mean, so all I gotta do is have a really like a 24-hour schedule and have a nurse. And so if Sharon's out of it, I'm just gonna put somebody in the house and take care of her, and I'll be there too. But, um, I don't have to care for by myself and lift her when I'm not able, or vice versa, you know, that kind of stuff. I don't deal with all that. I'll just hire somebody, just put a butler in there. We'll just turn the place into Downton Abbey, you know, and, um, ring a little bell, you know. I mean, why not?

It's cheap.

It's actually gonna— I've actually run the budget out. I think it's cheaper than a nursing home.

Yeah.

And I can buy medical equipment too. You can buy it, it's for sale. I mean, what need. Just put me one of those little drip things in there. I can put it in there, you know.

You can just sell it.

We're just going to turn the Ramsey House into a little, little nursing home.

Sell it on Facebook Marketplace.

Yeah, why not?

Here's what nobody warns you about. You're behind on payments, you signed up with some debt settlement company, you're making your monthly payments to them, and then one morning a process server knocks on your door. Surprise! You just got sued by a creditor. And that company you trusted? Not a law firm. They're not built to represent you if things escalate. And now you're scrambling to figure out what to do next. And that's why I tell people about Guardian Litigation Group. Guardian Litigation is not a call center. They're actual attorneys at a firm, and from day one you're assigned a real attorney who can represent you if a creditor takes you to court. No scrambling when things go sideways, just real legal protection built in from the start. And look, the best way out of debt is still the budget, the plan, the Baby Steps. But if you're already in default and legal threats are coming your way, Guardian has your back. Their attorneys have helped over 55,000 people settle more than $600 million in debt. So get real legal help at guardianlit.com. .com/ramsey. That's guardianlit.com/ramsey.

Attorney advertising, results may vary, and no specific outcome is guaranteed.

Our question of the day is Today's show is sponsored by Yrefy. If missed private student loan payments are keeping you from making progress toward your goals, Yrefy may be able to help you explore refinancing with a low fixed rate and a payment you can manage. Visit yrefy.com/ramsey. That's the letter Y, R-E-F-Y, dot com slash Ramsey. Might not be in all states.

Today's question comes from Carissa in Washington. Carissa writes, my husband and I have been married for 10 years. I earn $90,000 a year and he makes about $50,000 a year.

Last year.

We have joint bank accounts and we owe less than $220 grand on our mortgage. I want to put our extra money into a savings account to prepare for a future family, but he spends thousands of dollars each month on fast food. He has a binge eating disorder and ADHD. If we can't agree on a food budget and he's unable to make changes regarding how much he spends on eating out, is this justification for splitting up our bank accounts? I love him dearly, but fear that contributing my paycheck towards his eating out every meal enables him to make poor choices and takes away from planning for our future. Um, I guess where, Dave, where I would start with this is, um, the, the word she writes, he is unable to make changes. That's where I would pause and I would say he's unable or unwilling to go get the help he needs to make the changes. And that to me is the big red flag. Um, but yeah, if you have somebody in your family who is, who is for any number of reasons is out of control, putting your family at risk or harm, yes, you have to protect yourself.

You have to protect your family.

Um, but that's because, that's not because we're going to separate the accounts so I don't, so I can act like this doesn't happen. No, no. It's separating the accounts because I'm getting ready to divorce issue.

Yeah. Or I've gotta protect myself and protect each other. By the way, if he truly has, is, has disorders and emotional or psychological dysregulation and he quote unquote, you, you say can't control himself, but is unwilling to go do the work he, he needs to do. He's gonna start racking up debt. It's gonna, it's, it's you taking the money away is not just gonna stop this problem. There'll be other ways he's going to go get it unless he goes and gets the help that he needs. That's the real question here.

So separating your accounts to not deal with your husband's problems is not a plan.

Or to try to get him to do something different.

Yeah. No, no. Instead, deal with the problems.

Right.

I'm going to force you to deal with these problems. It's a condition of us staying together.

Right.

Because you can't continue to do cocaine and be my husband.

Yeah. In this case, I'm not going to watch my husband. I can't sit here and watch you die.

Yeah.

And so I love you enough to say, let's go invest in the help you need. Um, but yeah, you've got to keep yourself safe and you got to help him have an opportunity to make choices.

Okay. I got to be honest and you, you can call me out on this for my lack of compassion.

Okay.

Correct.

But I do believe that there are binge eating disorders.

Yep.

I'm positive that that occurs.

Yep.

This is the first time I've ever heard of a binge eating fast food disorder.

Disorder.

Yeah, I don't—

she must be calling BS.

Yeah, yeah, yeah.

Um, I, I'm calling— old boy wants to go by and get him some Chick-fil-A every freaking day, every morning and every afternoon and on the way home, and a Big Slurpee or whatever he's getting, and he just refuses to stop doing whatever the flip he wants to do, and she's calling it a disorder. That's my name.

Maybe, you know, binge eating disorder is very, very real. 100%.

Oh, completely real. Um, binge eating fast food disorder. That's a nuance I've not run into.

Yeah, that, that I'll give her the benefit of the doubt. She may have just said this is where he spends thousands of dollars, but thousands? Yeah, that's a lot of money.

That's a lot of Chick-fil-A.

Yeah, it's a lot, a lot, a lot of fast food.

A lot of Jesus chicken. Yeah, I, I can't get— I mean, it's expensive, but I can't.

And, and Carissa, like, talking about a big— if you're talking about thousands, plural, of dollars on on, um, cheap, inexpensive processed food, I, I would sit down and want to know. I'd want a detailed accounting of the money because this makes me wonder if there's other stuff going on.

Something else is happening.

Yeah, is there other things going on? Does he have other struggles? Is he struggling with other addictions that you don't know about? Um, that's a ton of money. A lot of money.

Yeah, I mean, yeah, I come out there— I mean, I don't go to fast food, but I come out— I do go Chick-fil-A, but I mean, it's— you come out there going, wow, there's and I went to the new one over here. What's the burger place?

In-N-Out.

They just moved their headquarters across the road from us over here, and so they've got one of their stops over here. So I went over and got one of those because they're famous. All you California people are freaking out. It is good, but I can't imagine spending thousands.

Yeah, it's a lot.

Thousands with an S. Yeah, that's— you must be as big as a house.

Stop.

Why?

How could you eat that much and not get that big?

Well, that's what she's saying.

Okay, all right. I don't know. Okay, this is— I'm good. Like I told you, I, I don't know anything about this. It just feels weird. All right, so either, either way, yes, but either you're overstating this disorder and it's just immaturity and an old boy doing whatever he wants to do and it's bowing up.

Yeah.

Or or he's actually got all of these disorder things going on, and that's very possible. We're not saying that's not happening. It's just I never run into this one. But either way, you gotta deal with him, and the way to deal with him is to help him and not to segregate the money off and hope that's gonna fix it.

Correct.

Because if you push somebody that's in your home and in your life over to the side, they're going to deteriorate.

And they're already struggling with—

They're not gonna get better. Yeah, because if they could get better, they would have already gotten better by themselves.

That's why I say he's got to go get the help he needs.

Exactly. Yeah, exactly. All right, Buck is in Nashville. Hi Buck, how are you?

Hey Dave, I am 22 years old. You just on the last call, you said if you're 22, listen up. So I just wanted to say that. But I am in the military. I'm deploying and my wife has decided she'd like to go to grad school in Europe. And I think it's a great idea, and I just want to get your ideas on the best way for us to pay for it.

You're deploying to Europe, I take it?

No, I— she's not going with me. I'm deploying to not Europe.

I recently, Buck, I decided that I want to get a 1,000-acre hunting ranch for me and my friends and my family family. The only problem is I don't have that much money.

Okay. I think I do have that much. I do have enough money. I just want to see the best way to— where to pull the money from.

Okay.

How much will grad school in Europe cost?

It's $30,000.

Okay. And what is she studying?

It'll be diplomacy from a very high Calgary University. Okay.

What does she want to work for?

The State Department.

Yeah, okay, all right. And to be able to say you graduated with your master's from Cambridge or whatever is a big deal. Okay, I'm with you. I made that up, you didn't say that. Um, but the, um, um, all right, and so you have the $30,000?

Yes. So I just graduated college last year. I have $130,000 in a brokerage account.

Okay. So you write a check and pay for it and then what?

Yes, I could. So I also have a car that's worth $25,000. I own it and I think we might just sell it since we're both going to be gone. We don't need it.

Okay.

That'd be okay.

And then My Roth has been maxed for the last 5 years.

No, we don't need to touch that. We have the money between the car and the brokerage account to pay for this easily. So she's going to be in grad school how long?

1 year.

And you're going to be deployed how long?

12 months.

Where? Can you say?

No, I can't. Okay. All right. And I'll be— my paycheck will be for the next 12 months, it'll be $100,000 untaxed.

Okay, combat zone.

Okay. Yeah, I mean, sounds pretty cut and dry.

What's the question? You have the money, she wants to do it, you're gonna be separated anyway, this is her desire, apparently has value, it adds value to do it there according to her, and I don't doubt that actually the way you're describing it. Why would you— what's the question?

I guess it's Is it smart to pull money from a brokerage that has made almost 30% per year the last half decade for that?

What's your other option?

I guess I have the car to sell.

Yeah, sell it. You're going to sell it anyway.

Or I could cash flow— I could just cash flow it.

All of that's okay.

Yeah.

Anything's okay.

You're overthinking it.

But before you borrow any money, we definitely cash out Brokerage, car, any of that's fine.

Hey guys, healthcare is one of the biggest stress points in your budget. It's confusing, and most of the time it feels completely out of your control, but there is a better way to handle it. Christian Healthcare Ministries isn't health insurance. It's a health cost-sharing ministry where Christians share each other's medical bills. And it's not a new idea. CHM has been around since 1981. It's predictable and proven, and they've shared over $13 billion in medical bills for their members. Plus, you get more flexibility. There are no network restrictions, and you don't have to wait for open enrollment. Now let's talk about how CHM helps your budget, because programs start at just $115 a month. And many families save hundreds of dollars a month compared to traditional options. So if you are tired of feeling stuck, check out Christian Healthcare Ministries. Right now, CHM is offering new members a 50% credit towards their first month of membership. Go to chministries.org/budget and use promo code RAMSEY. That's chministries.org/budget and use promo code RAMSEY.

You're gonna win a game, you have to play offense and defense. In the money game, offense is investing and defense is insurance. The right insurance acts as a shield around your loved ones and your wealth. Our free insurance coverage checkup helps you figure out if you've got the right coverage or if you're getting ripped off with a bunch of this garbage that's out there. It'll help you put a personalized action plan in place with clear steps. RamseySolutions.com/checkup and take the free coverage checkup. RamseySolutions.com/checkup. Matthew is in Tampa. Hi Matthew, how are you?

Hey, I'm doing all right. How are you guys doing?

Better than we deserve. What's up?

Um, so I'll just get right to it. Um, somewhat recently, uh, my wife informed me that we would be getting a divorce. Um, ouch. And it's— yeah, how long have you been married? Uh, going on 6 years.

What happened?

Um, kind of a layered question. It kind of came out of the blue for me. Uh, Um, she, um, has been kind of unhappy for some time and we've gone back and forth trying to figure it out. And I really thought that we did have it figured out. You know, I was checking in to make sure if we need to go back to a counselor, this, that, the other. Answer was always no. And then one day it's just, hey, I'm, uh, I'm done. Wow.

Okay.

Sorry, brother. That hurts.

What?

I'm sorry, that hurts. Um, yeah. What, so how can we help today?

So my question is, um, when we first got married, we purchased a house with cash using inheritance of hers. Um, now that things are kind of coming to a close, I'm trying to understand what the, um, kind of moral settlement to ask for would be. Um, considering I didn't contribute financially to the house itself, Now, every bill since, everything I've covered, she hasn't worked for some years now. She's been going to school and I've supported her through that. But I just basically, because of the method that we used to buy the house, I'm just curious, what's the most honoring way to her, myself, and God for me to proceed as we try to figure out a settlement?

In a lot of states, they will return her inheritance to her and then split the overage with you. And that would be fairly normal. So what'd you pay for the house when you bought it?

Uh, $500,000 originally.

Okay, so she'd get the $500,000 back. And then what will it sell for now?

Uh, probably $740,000.

Okay, and so there's $240,000, so $120,000 each minus expenses.

Would be, right?

That would be normal.

I, I did have a consult with an attorney who said that, you know, the remainder of her inheritance would be entirely blocked off. I would never dream of going for that anyhow. But it, um, but she said that the house, having been both of our names the entire time, it would, um, that would be an even split. Okay.

All right.

Like I said, some states, I don't know Florida now, you know, but that's, you You know, the— and you also didn't ask what the legal was. You asked what the moral thing was. I would return— if it's me, I would return to her what she brought in, and whatever you spent on her schooling or her sitting on the couch watching Oprah all these years or whatever, that's just part of being married that didn't work. So personally, I'd take $120,000 out of the house, let her take $120,000 out of the house, and her $500,000 goes back to her if it was me. And if she's got other inheritance money laying over the side. The lawyer's already said that's going to her anyway. In return though, like, have you got a big 401?

I have about $95,000.

Yeah, I would ask that she leave that alone.

Of course.

But she doesn't have to by law. But, but, but if the attorney says by law in Florida you're due half of this $500,000 portion on the house, house, then obviously you've got some negotiating points, right?

Sure, but, you know, I would never dream of going for half of the value of the house. Um, you know, kind of—

no, I wouldn't unless she went for half of my 401.

Of course.

Okay, that's what I mean by negotiating.

I, I hear what you're saying.

So I'll give you your $500,000 back and half of the value above that. You leave my 401 alone, I'll leave your balance of your inheritance alone, and we go on our way. Does that work?

Um, and, and you know, that, that makes a lot of sense, and that was my initial gut reaction. Um, essentially the, the holdup was, you know, based on her decision, do I need to move towns? Is that fair? But I, but I, I hear what you're saying, Dave.

I, let me throw something out. I, I'm trying to think if she called me and asked me the same I think I would have a different response to her, which is, hey, you're, you're bailing on your husband. When y'all got together, like y'all's money bought this house. Like, yes, you brought this money into the, to the marriage, but you, y'all bought a house. You put both your names on it. I, I don't know. I, I, I don't have the same hangup, I guess.

I'm not gonna hang up about it. You just asked me what, you know, what you were, the way you posed the question, I heard in the words, I'm trying to be gracious and I'm trying to be thoughtful. She brought this money in. What would be fair, what would be moral is what you asked, not what's legal, not what's hardcore negotiating and what can I get and what should I demand or anything like that. This doesn't sound like it's extremely contentious.

I'm just not that sort of person.

Okay, are you saying it is contentious but you're just not being contentious?

Um, there certainly have been some contentious conversations regarding the money itself. I just refuse to take part in that.

Okay, well, I mean, we obviously, based on the law, if we want to dance, you could go after that half and she could go at half of that $500,000 and she could go after half of your 401. 401. And that's, you know, because it's a balance sheet issue at that point. Everything's on the table, and your attorney's telling you her other inheritance is off the table. Okay, that's fine. Then I'm gonna go half to half in order to get my 401 released. And if we got to dance, we'll dance. But if you want to just say, what would— what could we end up with that would feel fair? That feels fair. It's not killing me if you end up splitting on the house. I'm not dying over it, but it, you know, it wasn't money you brought to the table, and I wouldn't take half of it as an offset for her having been at home or going to school while you were married. That's just part of you were being married, and that marriage didn't work. So I'm not— that's just off. That's just, you know, you're not— we're not splitting the food cost.

You provided all the food too. Yeah, she wasn't working. You know, you provide the gasoline for all the cars for 5 years or 6 years, but she— because she wasn't working. That's not not the, the, you know, I, I think that's just part of being married and that, that's water down the drain.

And I, I always tell folks in the situation to also calculate, and this is not a quantitative number so much as calculate a soul tax. Like, if this woman's broken your heart over and over again and you thought things were great, she led you to believe they were great, and she sat down and said, um, I'm, I quit, I'm leaving, um, part of me would say, I got a good job, I've got a good life, I want nothing more to do with you then, and leave me my retirement. I'm out of here. Have a good life. And I— part of me, there's a soul tax too. There's a cost to your spirit for fighting for this stuff.

Yeah, but if she wants the house, she's got to write me $120,000 check and leave my 401k alone. Yeah, or we're gonna sell the house and you get $500,000 plus $120,000. I get $120,000, you leave my 401k alone. There you go. Or I'll come after all of love it and make you leave my 401 alone.

Right.

You know, so that I can be nice to you. Yeah. Let's just, you know, if you want to go, if we have to dance, I can punch to make you dance.

But I don't want to.

That's not what I'm trying to do here because I'm not contentious. Yeah, I like that. That's good. I think that's solid. But here, the thing that's hard to remember, and Matthew, you're doing a pretty good job at it, for you folks out there, when there's a divorce, there's always high emotion, always drama. Always all this stuff. But when it comes to the financial part of the transaction of a divorce, a divorce turns your life into a business transaction. You're just gonna sit down and go, one for you, one for me, one for you, two for me, one for you, three for me, five for the kids, six for the marriage, whatever, alimony, whatever. And there's just a— it just becomes a numbers transaction. And then you've got all the emotions and all the broken hardened and the rage.

But just like business, the more you let emotions get in business decisions, the messier they get, right?

Yep.

When I started, I had great ideas and I knew how to serve people, but I didn't have systems in place yet. At that time, I sold books out of the trunk of my car. It was a lot harder to start a business back then. Shopify makes it easier. Shopify is the business platform powering millions of businesses and about 10% of all e-commerce in the United States. If you've got a product or even just an idea, shopify makes it simple to get moving. You can build a storefront, write product descriptions, and even improve your product photos all in one place. You don't need 10 different systems duct-taped together. Shopify handles everything you need to make sales, from payments to marketing and analytics. Plus, that purple Shop Pay button is one of the best converting checkouts on the planet for fewer abandoned carts. And if you get stuck, Shopify offers 24/7 support. So if you've been sitting on the sidelines, it's time to turn those ideas into— sign up for your $1 per month trial at shopify.com/ramsey. That's shopify.com/ramsey. shopify.com/ramsey. Pete is with us. Pete's in Boston. How are you, Pete?

Hi, Dave. This is pretty cool.

Good to have you, sir. How can we help?

Thank you. So, uh, Uh, I worked for a company, a semiconductor company outside of Boston, and I bought their stock through employee stock purchase program. Um, and fast forward a little bit, um, I got laid off about 2 years ago, so I don't really have any emotional attachment to the company. However, um, since I worked for the company, The stock skyrocketed. Uh, that's just kind of the nature of the stock market today. Uh, my question is, I'm asking what you would do, uh, to sell this stock off to minimize my capital gains taxes, but also to diversify my portfolio a little bit because it's made This, this stock ownership has made up about 40% of my overall net worth.

Yeah, that's, that's dangerous. We call, we call spreading the money around diversification. I'm sure you've heard of that. And money's like manure, it grows things when it's spread around. Left in one pile, it stinks. And so that's what we're trying to do here. We're trying to spread it around a little bit because you've got too much risk associated with that one company. It might go to the moon and it might go in the ditch. And, and as such, 40% of your net worth does. So that scares me if I'm you. So yes, I would begin divesting. How— you said you've been gone for 2 years?

Yes, sir.

Okay, so all of it is gonna be on long-term capital gain?

Correct.

And so do you— what's the value of the portfolio of stock today, the whole pile?

Uh, as of today it's about $170,000.

Cool. Good for you. I'm so happy for you. Um, and, uh, do you know what your basis is in it? Have you called and asked for them to calculate that?

Yeah. So, uh, every 6 months they would give you a different basis that you'd buy the stock at. Uh, and it ranges anywhere between $79 from when I first bought it to around $264. When I got laid off.

So, but the total basis in the total portfolio is a single number of all of those averages. Do you know what that number is?

I just did a rough calculation. If I were to estimate, it's around $180.

And there's how many shares?

260.

Okay, so 260 times 180 is what? That's your total. Okay, so that's the thing. So that's what I want to do, is that, and then the difference in that and $170,000 is your gain.

It's about $47,000.

Okay, so we'll call it $50,000 because we don't know. You actually can call the company that's handling the stock. So you've got that stock sitting somewhere, right?

Mm-hmm, yes.

You can call them, they'll tell you what the basis is, or send them an email, they'll send it to you, okay? Because they've got it on file. So anything over that basis is going to be taxed at 15%. So if it's $50,000 is your basis, then you've got a $120,000 gain, and so your taxes are going to be about $17,000. Okay, that's how you do it— 15% of your gain, okay? And that's not a big deal. So given that that's the number, and it's probably going to be very close to that number, number, okay? Because I think you're probably pretty close on your basis. And so given that the whole, you know, we can take $170,000 out of a risky position for by paying $17,000, I'm paying the $17,000 straight up and I'm gonna cash it all in. I'm gonna put it in mutual funds or put it on my debts or wherever I am in the Baby Steps. I'm gonna get completely out of this stock.

Yeah, it's, you know, in the past 3 months the, the stock has pretty much tripled.

So if you want to play single stocks, then, then I'm not your guy.

It's, it's sitting at the blackjack table, dude, and you're like, yeah, but the last 3 hands I've won. You're right, you did.

No, I'm definitely the kind of person that puts my money into a mutual fund with which I have separate from this single stock portfolio.

It may triple again after you sell it, but it might triple down if you don't sell it. So I don't know what it'll do. But a single stock is infinitely more risky than a mutual fund with 90 to 200 stocks in it, because you spread your risk around and so on. I didn't buy SpaceX for that reason. It might end up being a good investment. I haven't invested in Apple, which has been a wonderful stock, but I don't buy single stocks. I don't like the risk. And so I've got enough risk in my life without that, so I'm good. And if I make a little less than some of the guys that are players, well, so be it, because I'm not a player. I'm a guy that builds wealth. There's a difference.

Dave's a player.

I'm trying to get rich, not impress somebody on the internet. And so that's the thing. And so that's what I buy. I buy things in very predictable environments, sickeningly boring. And so I don't play single stocks. You know, the first— the worst one I've ever had was a lady came in for coaching 30 years ago when we first started doing counseling and coaching. Coaching, and she had just retired, 70 years old, and she worked for a huge company that we all know the name of, and she had 100% of her 401 in company stock, and it was $1.7 million, and at the high point, and she retired and the stock went down down hundreds of thousands of dollars in 4 months because that company got in the tank. They got in trouble. And I mean, and she was just— I'll never forget just sitting there with her, and she's 70 years old, she's just crying.

Yeah.

I mean, she had lost $700,000 in 3 months.

Dude, I had friends and family growing up in Houston that worked for that little company called Enron. Gone.

Yeah.

And they woke up with zero.

Yeah, exactly.

Nothing.

Exactly.

And they were notorious for their incredibly generous stock buying program.

Yep.

Right.

It's just, it's, you know, there are obviously good companies and we want to be in those, but the way I'll be in them is with the whole batch of them, not a singular thing. I just don't do Karate Kid, stand on one leg and hope I can kick, you know. I'm just not doing it. And so it's— that's the— that's what you're doing. It's very dangerous.

And I have had to learn this, like, just messing around. Like, if I go to Las Vegas and I have some silly fun at a table, I can't get mad. I can't. I just have to hold loosely. I'm playing with house money. And if I could, I could have made more, great, but I'm leaving with what I got, and I'm happy with what I I got and I'm gonna walk away. So if you do sell this brother, which I hope you do today, never look at the price again. Cause you're only gonna make yourself nuts.

Yeah. Yeah.

That's true.

You're gonna make yourself feel superior. If it goes down, you're gonna make yourself feel bananas about what I could have had. The reality is here's what you have. I'm gonna be grateful for the gain that it made. It's awesome. I got extra money and I'm good to go.

And it does remind us of the, a lesson we teach around here very often called sunk cost analysis. Analysis.

Yeah.

And that is, if you had $170,000 in the middle of the table stacked in cash and Benjamins, would you go buy this stock? Well, it went up 3 times in the last 3 months. If you had $170,000 in the middle of the table, would you go buy this stock? No, it's just too much risk. Then sell it.

Sell it. Yeah, sell it.

That's the thing. No, I wouldn't. Yes, I would. If yes, you would, then keep it.

Yeah.

You know, that's what you're gonna do. But, you know, I don't do that stuff, and that's why you know, why I'm okay. I don't have— I'm not counting on crypto or DraftKings to bring me through, you know. I'm gonna be okay. I don't have to swing for the fence on every swing. I'm good with triples. I'm good with singles. I'm good with doubles.

A team that hits a single every time somebody goes up to plate wins every World Series.

Every single time. Every time.

I remember a football coach said that if I get 4, 3, 3, 3 yards on every play, then we win every, we win every game.

Yep. 100%.

It's boring.

Yeah.

We'll win every game.

Ground and pound, baby.

Yeah.

Winns Credit Union studio. I'm Dave Ramsey, your host. Thank you for joining us. Dr. John Delony, Ramsey personality, number one bestselling author, is my co-host today. Derek's in Chicago. Hi Derek, how are you?

Hi Dave, how you doing?

Better than I deserve. How can we help?

Yeah, so I'm an engineer and my wife is a veterinarian. We recently became debt-free by paying off over $120,000 in student loans in the last 11 months. Way to go. Um, Um, yeah, thank you, thank you. Uh, so we have aspirations of starting a veterinary clinic in the next 1 to 3 years.

Cool.

And would love to just get your advice on what we should be doing now to prepare for starting this business.

Excellent, I love it, way to go. Well, I, I'm pretty sure you could do that for $120K, and you did that in 11 months.

Right? Yeah, yeah.

Okay, but let's break it down and think about how I would go about it from day one. The thing I have learned in business are the three rules, and the three rules are: it's gonna take twice as long as you think, cost twice as much as you think, and you're not the exception. And I run into that inside Ramsey all the time with something we're doing that's new and different that we've never done before. It's harder than we thought, it's gonna cost more than we thought, God thought, and it turns out we're not smart enough to beat that. We got to go do it anyway. So what I would do in your situation is I would first admit that what you think this is going to look like when you actually open the clinic is wrong, but we're going to try anyway. Okay, but be ready for some ideas you have about this and your wife has about how this is going to feel, how it's going to the way the wallpaper is going to be in the waiting room or whatever is going to be different than she has it in her emotions. So be prepared for your dream to be reformed and pruned as you go along.

It's almost like young people leave their parents' house and they think they should buy a house the exact same size as their parents left. You know what I mean?

Yeah.

So it's like, hey, I got to buy— you actually got to buy a 900-square-foot starter house. And over the— over time, growing into this amazing thing that you want.

So what I do then, with that in mind, is I would lay down what I think my square footage is that I need, what the location's gonna look like, and I would start talking about what the rent is gonna look like to open the practice. Then I would start talking about the equipment, and I have a strong recommendation that you buy slightly used equipment. Equipment from the last veterinarian that didn't do a good job and went broke because they didn't do what we're talking about doing. Okay, because, uh, 100% of the equipment she's going to use and the equipment I'm using to speak into called a microphone right now is obsolete in 18 months after you buy it. Yeah, an 18-month-old technology item is a doorstop.

Stop.

There are no 30-year-old x-ray machines except in third world countries.

Okay.

You follow me? So the x-ray machine, the MRI machine, the thing she thinks it's gonna save puppies' lives or whatever it is, and some salesman with equipment is gonna get you so far off-kilter on what you've spent that you will never ROI. So the rule we use on equipment purchases around here is minimal functional, minimal functional. What's the least that will get the job done? And then we might go 2 notches above that. We don't want the best and brightest. We don't want the shiniest unless it's just $2 or something. But most of the best and brightest in your world is $200,000, and you're trying to save the life of a cat. No.

Right.

Okay?

No. And so you just gotta be wise about your equipment purchases and then look at your staffing. And so what's it gonna take us and how long is it gonna take us to get some business built up, get some new clients and so forth? And those are your costs. The number of days that you burn money until you make money, that's cost one. Your setup is cost two. Rent is cost 3, your staff is cost 4, and you lay those things down, and then that's gonna tell you how much you need to save. But I think you could probably get it— I'm just, wild guess, I'm not a veterinarian. I love veterinarians and we do a lot of work with them. A bunch of them are being coached in EntreLeadership. But my guess is if you went minimal functional, you can do a whole lot for $150 grand to get this thing off the ground.

Yeah, that seems pretty consistent with what I've seen. Can I ask you a question about how to save for this? Because we kind of We're kind of investing in our Roth IRAs and doing some investing through our work, but should we stop our investing in Roth IRAs and just kind of pile cash in like a high-yield savings?

If it's the only way you can get there in 3 years, but I think you might be able to do both.

Okay.

Based on the fact that you paid off $120,000 in 11 months while putting nothing in retirement, we need $150,000, but we got 3 years, not 11 months. Okay, so, you know, you probably can do both. If you want to tighten the timeline up and say, I want to be ready in 1 year and I want to save $150 grand, and you want to put hold on, push pause to get the business open and pay cash for it in 1 year, that's fine. I would not do that for 3 years. Okay, I would not do zero investing for 3 years while I save for this, but I would for 1.

Yeah, okay. There's a high likelihood that with the start of this clinic, there would also be a move. And so another part of that equation is potentially, you know, saving up to buy a house wherever we move, things like that.

You own a house now?

There's a lot of different— no, we rent currently.

Okay, well then decide which is which. We want to move and buy a house, or we want to move and start a clinic? You might not be able to do both. You might have to choose for now. You might buy the house out of the money you make on the clinic.

But beware of creep of scope.

Yeah, scope creep.

Because man, the next logical is, well, what if we just built our own? And what if we just bought our own place? And that might ROI. We'll put it— we'll put a business on the back of it, and that will also help pay for it. And there's a new AI machine that says they can do through laser MRIs, through, you get what I'm saying? It's so easy to sit down and all this thing becomes a million-dollar project without even sneezing.

Yeah, it's really easy. Just start it as raw and make it make money, and when it makes money, grow the business and grow the equipment list with the money you make, not with anything else. What does she make now as a veterinarian?

She's only one year in, and so she makes $115,000.

Okay, yeah. I mean, if she's got a 2-year-old practice and is successful, she'll make $200,000.

Okay, yeah, we have aspirations to start this one practice and grow it into a healthy business and then start to duplicate that over a region that we want to live in. And so we have high hopes and dreams for this, but we want to make sure—

The first thing is get the home office straight, yeah. Yeah, if I'm you, I'm probably gonna go whole hog on this and say, I'm gonna take one more year off of investing. I'm gonna save enough. I'm gonna move and I'm gonna rent and I'm gonna open the clinic and get the clinic profitable. And then I'm gonna talk about buying and then I'm gonna grow the clinic and grow the clinic and grow the clinic. And she'll be making a quarter million dollars pretty quick in that world. And it'll be worth the investment. And it's a great field she's in. It's a great field.

Just start small.

Yeah, not only do we love animals around Ramsey, But, you know, it's just you guys just have the ability to make a lot of money. And veterinarians, all of them I work with, they're just really smart.

Yeah, they're smart and they're great people.

Yeah. I just don't run into any of them that are jerks.

Hey, what's up, guys? It's Jade Warshaw. Listen, summer spending adds up so fast. Between vacations and road trips and camp fees and events and all the extra gas and grocery runs, money can get tight before you know it. To really get your money under control and keep it that way, you're gonna need a plan. And that's what you'll get with the EveryDollar budgeting system.

Budget app.

It helps you track your spending, free up cash to put toward debt and savings, and it's the simplest way to make a plan for your money before the month begins. So no more wondering where your money's going. You're telling it where to go. Download EveryDollar in the App Store or Google Play and start for free today.

If you're thinking about conducting one of the largest purchases that people make, like a house, you should have a pro in your corner, not someone who got their license 3 weeks ago that you met at church. No, you want a real estate agent that gets a lot of houses sold, period. And you want, you want high octane, high protein. If you want a Ramsey Trusted Real Estate Agent, that we have vetted for their professionalism, their effectiveness, the amount of volume they do, and so on. They follow the Ramsey Plan. You can connect with a Ramsey Trusted Agent who has your best interest at heart for free at ramseysolutions.com/agent, or click the link in the description if you're on YouTube or podcast. Dave is in Chicago. Hi, Dave, how are you?

Hi, Dave and John. I hope you all are well.

We are. How can we help?

I have a question in reference to, um, long-term care. I'm currently 62 and I started working with a fiduciary earlier this year, um, to assist me with some of my investing and increasing my investing. But one of the products that she talked about, or one of the investing opportunities, so to speak, that she talked about at my age was a long-term care annuity that would guarantee a certain income during up to 7 years of, of, um, time. If I was ever, um, unable to work, my plan is to retire when I'm 70. So I've got 8 years to retirement planned anyway.

What's the size of your nest egg?

Well, right now I have approximately $375,000 in a traditional IRA outside of my 401. I have about $80,000 in my 401 because I did an in-service rollover into the IRA outside of my 401. Um, then, um, I'm back up to $80,000 in my 401. Uh, I've got $80,000 in a high-yield savings account and I've got $70,000 in my checking account. Okay. So somewhere around $500,000 or $600,000 total. Gotcha.

Okay. Good for you.

So I'm hoping, and I just started investing in my 401 and stuff probably about 4 years ago.

And you're 62?

Yes, I'm 62. Okay.

Um, and the average nursing home stay is 2 and a half years.

Oh, okay.

And the average cost is $100,000 a year.

Okay.

So your exposure is $200,000 to $300,000.

Okay.

Are you married?

So that's not— No, I'm single. Um, don't own a home. I stay with my parents to help take care of them because they're both 85 and don't get around too well. So I stay with them. And, um, my only other expense really is just my daily expenses. Plus I rent an office for work. Um, outside of, uh, my home, and that costs me about $500 a month. So really I don't have many expenses.

So if you leave the $600 alone and it's invested in market rates, and let's say it doesn't even do as good as market rates and it only makes 10%, it will double in 7 years. At 69, you would have $1.2 million.

Okay, great.

That's without adding anything to it. And so I'm gonna self-insure through my nursing home needs. If you want to buy a nursing home policy, you can. They generally only cover about 2 years. No, I would never combine them with an investment or with an annuity under any circumstances. 100% of the time, that's a bad product. I don't like your investment advisor.

Right. Okay. That's what I thought. And I appreciate that. Um, one thing about the investment. I currently put, I currently put 16% plus my $11,200 that I can put in until I'm 63 for catch-up contribution.

Right.

So, um, I'm hoping that I'm going to actually be over that $1.2 million, hopefully.

Yeah, you will be because you're adding to it. I'm talking about just doubling what you've got without adding anything.

To it.

But yeah, you'll be way over that. You should be, you know, 1.6 or so.

Oh, good, good. So I'm pretty well covered for my retirement.

Assuming you're not putting this in something other than mutual funds. If you're putting in good growth stock mutual funds and you're averaging market rates of return is what I'm going with. Now, I don't know what this advisor, the supposed fiduciary that sells insurance crap that you've got here— I'm worried about that.

But, um, walk me through your disdain for annuities.

Okay, I, I, I— it comes from two sources. Okay, number one, there's two types of annuities. There's a fixed annuity, which is not what he's talking about. A fixed annuity is simply a savings account with a life insurance company that has really bad terms, right? Never under any circumstances do that.

Run.

The variable annuity is fine. A variable annuity is a mutual fund inside of an annuity. Okay, so it's going to grow without taxes on it until you cash it out, just like a 401 traditional. Okay, it's a tax-deferred growth in an annuity. That's what it gives you. It gives you tax-deferred growth. They also have a couple other features. You can name a beneficiary, so it goes outside of probate. It's nice that way. And some of them will give— most of them these days will give guaranteed minimums on the rate of return and a guaranteed return of principal if the market goes down. Most of which, if you leave it alone the 7 years that they require, 99% of the times in the stock market's history you would have gotten that anyway. So it's, it's a false guarantee, but it's real. It's a real guarantee. It's not needed. If you just left it alone, you'd be fine. Same thing. So you're paying an annuity fee as a commission, and you're paying the mutual fund fees. Not just the mutual fund fees. If you just bought mutual funds, you wouldn't have the fee. And so they're okay The variable annuity is because you're in good mutual funds and you've got a couple other little features that are nice.

They're not the end of the world. But unless you have your house paid off, everything paid off, and you're scared to death of risk, and this is all after retirement investing, and it's only an annuity, it's not tied to long-term care, it's not tied to other crap, which his was, then it's okay.

What's the business move? Move for somebody to try to sell you an annuity attached to—

they make more money. The bundling, it just becomes a re— the math is horrendous.

Gotcha.

If you bought the two things separately, you'd come out light years better.

Gotcha.

The insurance company— when insurance company— the only thing that insurance companies bundle together that end up being to your favor is homeowners and car, right?

Home and auto.

Yeah. Yeah. But if they bundle savings inside of an insurance policy like whole life and universal, 100% Anytime they start putting stuff together, it's for their benefit, not yours.

Gotcha.

Run. Okay, run away. Then the second thing is, the only way you can sell a mutual fund if you're a life insurance agent— you're not licensed to sell securities— is you can sell a variable annuity because it's got mutual funds inside of it, but you're life insurance licensed.

Gotcha.

But, and so And so most of the time when I hear someone pitching that my financial advisor is selling me, is wanting me to get a variable annuity, it's almost always a life insurance agent, not a financial advisor.

Gotcha.

And they call themselves, we're financial advisors.

We're fiduciaries. Yeah, yeah.

We're financial advisors. No, you're not. You're a freaking life insurance agent.

Yeah.

That's all you are. You just don't have a securities license. This is the only way you can sell a semi-decent product. And so instead of going to get a securities license, being a real financial advisor, you're just over there with the whale, with Pacific Life.

Gotcha.

You know, pshh, you got a little splash going, right? And there we go. And it's just bullcrap. It's just bull— you know, New York Life, Prudential, Pacific Life, these are all whole life life insurance companies that sell variable annuities and call themselves fiduciaries. They're not fiduciaries, they're life insurance agents. And they're old whole life agents is what they are. They used to sell cash value you, and some of them have gone to indexed universal or indexed annuities. Bullcrap. Just go buy an index fund or sit down with a real advisor like a SmartVestor Pro, and they'll sit down and show you, and you don't have the fees. You only got half the fees that you would have had otherwise. You have fees, but not anywhere near as high, and they're not going to sell you crap like trying to bundle your long-term care insurance for nursing home with your investments. Can you think of a possible reason that that's even logical? It's not. I mean, these— what, this is like Sesame Street. None of these things is like the other, you know. So that, that's my disdain for it, is it comes from knowing how the business works inside the dugout, how baseball works inside the dugout, and it pisses me off.

But the actual product itself, the variable annuities standalone, I am not against them in most circumstances. I'm against how they come up and who sells them most of the time.

The problem with online investing advice: you hear so many different opinions and you're left wondering if you're even doing it right. And that's why we created Investing Essentials. Join me and Dave Ramsey at this two-night virtual event to learn Dave's playbook for investing and wealth planning.

Planning.

We'll break down 401s, mutual funds, passing on wealth, and more. So join us September 1st and 2nd. Tickets start at $199. You can get yours today at ramsaysolutions.com/events, or just click the link in the show notes.

Hugh is with us Hugh is in Wichita, Kansas. Hi, Hugh, how are you?

Dave, I'm just about as fine as frogs' hair. How are you doing today?

Just the same, sir. How can we help?

Yes, sir. So I was listening to the show a while back and heard Dr. Delony talking about some of the research he's been doing on married couples and everything and how they tend to do a little bit better, be a little bit more wealthy. And that got me thinking. I lost my wife in December.

Oh my gosh, I'm sorry.

Yes, sir.

How long were you married?

Uh, 20 years. What was her name? We were married.

So what was her name, brother?

I just was, uh, Summer.

She's pretty awesome.

She was great. She was the best.

So sorry, man.

Yeah, I appreciate it, but you know, I just, I'm not looking to to go out and do anything, but I was just kind of curious, you know, what— for somebody in my situation, what's that kind of mean? I mean, am I kind of just stuck where I'm at or what? So anyway, I just was kind of curious.

Did you lose the marriage advantage when you lost her? Is that what you're asking?

Yeah, I guess that's the question.

So how old are you?

I'm 46.

Okay.

And how are you doing financially and in your career and health-wise?

My health is fine. Financially, we're— well, I'm finishing up Baby Step 2, getting ready to start on 3. And career-wise, I'm doing pretty good. Okay. So, all right.

I can tell you, brother, if I was to look back and have lost my wife of 24 years in December I don't know that I would still know what day it is.

Yeah.

You know what I mean?

It definitely sucks. We've got 4 kids. And honestly, if it wasn't for them, I don't know where I'd be at.

How old are they?

I have one that's 19, one that's 17, one that's 15, and then one that's 12. And our 12-year-old is special needs. Mm-hmm.

So I, this is gonna sound strange, but my guess is in 18 months and 24 months is when you'll start to not see the pain. Won't just go away or anything like that. No matter what nonsense people tell you, but you're still in the thick of the black fog of grief right now. And you're, you're such a good man and you got 4 kids. Like you don't have an option other than to get up and to plow through the next day. What I want to challenge you on is spending as little time right now on big existential, what does it all mean questions, because, um, that's like asking— it's like being in the dark, lost in a forest, and thinking about, um, what's the meaning of life. Like, what we need to do is get back to the road. You get what I'm saying?

Yeah.

And so So the marriage advantage right now is you have 4 amazing kids that have a picture of this amazing woman named Summer, and y'all built something together. Y'all have got this legacy that's gonna outlast both of you and anything beyond honoring her and getting up the next day and doing the next right thing for us a, a long time. That's where, that's where you need to spend your energy. Does that make sense?

So, yes, sir.

Yeah.

The Marriage Advantage is a series of averages over a large set of data.

Over a long period of time.

Over a long period of time. And so if you're not married today because you lost your wife 6 months ago, you are not at a distinct disadvantage, okay? But The Marriage Advantage points out that over the scope of life, those that are married who are married over a 40-year, 50-year period of time live longer, report better life satisfaction and happiness. They report higher levels of wealth, way higher levels of wealth over a long period of time. That's the marriage advantage. And there's a whole set of data and a whole set of research, a bunch of research projects that back all of that up. But also there's a piece of data that says is this: if you are 19 years old and your parents got divorced and you marry someone whose parents got divorced, you are much higher likelihood statistically to get divorced than two 19-year-olds whose parents stayed together if you get married, right? But that doesn't mean that just because both of your parents got divorced that 100% of the time you're going to be the same statistic.

It's not deterministic. It's correlative. It's not causal, right? Exactly.

It doesn't cause that to and so, you know, but so what behaviors are, you know, what do you have to solve for in that? Well, you solve for the things that Summer brought to the table, and you keep living your life that way. And then you've still got that portion of the marriage advantage. Plus, you don't really have a choice. You're here. And so you've got to, you know, you're solving for, "I'm not going to be the average. I'm going to be the one that beats the average and causes the average to go, And that's what those two 19-year-olds with divorced parents prove.

We're going to have to do different things.

The statistics are if you've known each other for 3 weeks and you get married, you know, 90% of those marriages don't last.

Okay?

But you do meet people that were married, that knew each other 3 weeks and were married for 40 years.

And they got up every day and decided, yeah.

So they beat the odds, so to speak.

The main, if you distill all the way down, the marriage advantage, two people people doing a thing over time together, us two, ride or die, gives you margin. It gives you the ability that when one of you can only carry 20%, the other person's carrying 80. It is two people pulling in the same direction, and that's what you did for 20 years.

And, and that's what you've, uh, that's what the hole in your life is.

That's exactly what you miss, right?

But that doesn't mean you're, quote, deterministically doomed, right, at all. Not even close. That's the point of this.

So, dude, we're sorry for your loss, brother.

Yeah, very Very sorry. You're gonna make it, and you know, you're not gonna miss out on the marriage advantage. You've already had the advantage.

But again, spend the least amount of time thinking about those big picture things.

That kind of stuff, yeah.

Honor your wife, write her a letter every day, get up and do the next right thing for your kids. You're a good, good man.

Anna's in Los Angeles. Hi, Anna, how are you?

Hi, I'm great.

Good day, Dave.

Hey, what's up?

Yes, um, just a little background. I'm from Silicon Valley and work in a healthcare industry. I'm 54 years old, plan to retire in 2 years, married. I have 2 kids that just graduated from college, and my question is, is it a smart idea to buy short-term rental for tax purposes? Just because this year our combined salaries will be around $750K And we—

the only short-term rentals that create a tax advantage are those that lose money. Okay, so your depreciation on the, on the property, your depreciation schedule is larger than your income, which it would not be on a short-term rental.

So the bonus depreciation and the cost segregation won't help at all?

No, if you actually lose money, then you that you save money.

But if you want to do that, just give it to a charity. It's the same write-off. Okay, don't lose money to save on taxes. If somebody's telling you to do that, get away from them. They're dumb. No. And short-term rentals are a nightmare, Anna. I mean, you're talking about buying Airbnbs to save on taxes while you're making all this money because you're smart people, and now you just turned yourself into a hotel manager. Made, because every time somebody screws up the sheets over there at your Airbnb, you're over there changing the sheets.

Yeah, find something that you and your spouse really believe in and donate to that.

Yeah, much easier. Don't go losing money and turn yourself into a hotel maid when you're making a million dollars a year just to call, just to say, you know, I'm in the short-term rental business. Oh God, gross.

Yeah, there's—

talk about high maintenance pain in the butt to operate. Airbnb, I mean, it's like running a Motel 6. Can you imagine? Leave the light on.

No. Yeah, the light's off.

Killing me, Tom.

Lights off.

Tom Bodett, you remember him? Oh yeah, leave the light on. We'll leave the light on for you.

Yeah, that's because we don't know how to turn it off.

We have a lockbox on the front door. We'll leave the light on for you.

Hey, George Campbell here. We often talk about how being normal sucks when it comes to your money, but guess what? Normal isn't so great when it comes to your job either. Normal is staying in a job you hate, dreading Mondays, and working for people you don't even like. Sound familiar? Well, the good news is you can break free from normal because Ramsey Solutions is hiring, and we refuse to settle settle for the ordinary. In fact, we are anything but normal, and we are proud of it. And right now we're hiring for technology, sales, marketing, writing, copy editing, and creative roles. So head over to ramseysolutions.com/careers and apply today.

Our Scripture of the Day, Proverbs 25:21: If your enemy is hungry, give him food to eat. If he is thirsty, give him water to drink. Ben Franklin said, love your enemies, for they tell us your faults— for they tell you your faults. I've never heard that one.

That's good.

Maria's in Atlanta. Hi, Maria, how are you?

Hi, Dave, this is Maria. How are you doing?

Better than I deserve. What's up?

Okay, so, um, I read your book and I'm planning to save $1,000 in 401, um, and I've already included it in my budget. Um, and I also need to take about $262 taken out of my paycheck every month, uh, for medical and all that stuff because I'm a civil engineer and I recently graduated with my master's in engineering. And I'm also planning to live rice and beans. And then I have an electric car. So, you know, my charging is going to be budgeted to like $40 per month. If I can't make that, then I'm going to have to take the bus.

How can we help you, hon?

Yeah.

What's going on?

Okay. Um, my situation is that I'm a civil engineer and I recently graduated with my master's degree, but I've been fired at 9 different civil engineering jobs. Um, since I graduated with my BS back in 2017.

Why do you keep getting laid off? What's happening?

Um, I have this, uh, I was immature, you know, um, Over time I realized that it's like corporate, so corporate is very strict, stringent, like kind of like military style, because I work in like different projects, government projects and all that stuff, and they want you to stay calm under pressure, and I wasn't able to do that at the 9 different jobs, so that's why I got laid off, or like let go. Go fired.

So have, have you done the work on emotional regulation? 'Cause it sounds, I mean, it sounds like, like if, if you went and got a, a degree as a nurse and every time you saw blood or had to put a needle on somebody's arm, you passed out. That's, that's a critical part of that job, right?

So critical part of your job is staying calm and regulated, right?

So if you, it may be that you've reached a point where you say, I don't, I I either A, can't make the leap to do this thing, or I don't have it in me to go put in the work to go learn these skills of emotional regulation so that I can do this job.

Have you sought some professional help, like a therapist to help you?

Yes, I've gotten therapy help, and I've also joined the union at my last job. Job and realize that, you know, it's the corporate system. And within that corporate system, you have to basically make it through in order to, um, to make it through the corporate world.

Yeah, but corporate is just like this amorphous word. Just don't use that word anymore. Think of it this way: if I agree to do a job for a company and I shake hands with them and they say, we'll give you this amount of money for this job. A, they have to believe I can do the job both in temperament and in skill and in social ability. Like I'm a person that other people can work with. And then I gotta show up every day and do that job. That's not about corporate. That's not about str— every job on planet Earth, whether you're a lawn person or you're working for a company with 10,000 employees, is gonna say, here's the job. And there's a social component. Here's how we do this job here. And then I get to choose as the employee whether I do that or I've gotta go get some additional training so that I can meet these needs.

Mm-hmm.

You get what I'm saying? It, it's not this, this thing called corporate out there. It's, it's when I sign up to do any job anywhere at any time, I'm signing up for a particular culture, a particular vision, a particular set of values and a particular job skill.

Yeah. How, how, how long did you see a therapist? Therapist?

Um, I started seeing a therapist back in 2020, uh, 2023, um, right after COVID. And because I was unemployed for about a year and a half during COVID so it's, it's not a problem for me to get another job. The issue is me keeping a Yeah, that's what we're talking about.

Yeah. How long did you meet with the therapist? From '23 to what, now?

To now.

And how often do you meet with them?

Uh, I meet with him weekly.

Okay. Is he, is he explaining for you how to, uh, maintain your composure and your calm in the middle of working on an engineering project with other people?

I didn't realize that up until, um, now because because I've been seeing— I also saw, you know, different therapists because I couldn't afford it. So I kept, um, switching therapists.

So I want you to sit down with your therapist after you've been seeing the same person for a couple years. I want you to say these words: I would like to run some scenarios, do some role-playing in here so that I can practice. And a good therapist will walk alongside you, set you up in situations, and then we'll practice whatever we got to practice for these social interactions so that you can improve a skill set. Just going in therapy and talking about it over and over and over again isn't going to help you at this point. We need some real skills that we can practice in the real world. And so continue putting that work in.

Yeah, there's an old book that came out years ago called EQ, and the author makes the point in book that, that's called Emotional Quotient, that the ability to manage your emotions and manage and interact with relationships positively is hot— it is a higher indicator of success than IQ, than intelligence. Yeah. So the ability to play well with others is a bigger deal, but your ability to do that, he measured on EQ. And so if your EQ is low and your IQ is high, you're very smart, but you're horrible with relationships and regulating, managing to keep your emotions under control and pressure, then you're going to struggle in any career.

Correct.

There's not a career that keeps you from doing that.

I— even being 17 years old, working the lunch rush at Burger King, it got overwhelming, right? And we— everybody has to keep their cool. So any job anywhere is gonna have those inflection stress points.

Yeah. And so working on your EQ makes you maintain your employment, which gives you the income then to start talking about, you know, getting the electric car charged, getting your budget going, getting your 401 going, getting your emergency fund in place and all of those things. But, you know, getting and keeping a job is dependent upon you managing your behavior differently than you have in the last 9 jobs.

Right. And it sounds like you're putting the work in, but let's get real tactical now and start practicing asking social exchanges.

Hey, Doc, I want you to— I want to— I want to play pretend how this is gonna feel, right? And then see if he can get your— get you to lose your cool.

Yeah. And then walk with you through.

Cool in the therapist's office, then you can learn how to not lose your cool.

That's right.

Yeah. And, and get— and get back in control. That's a good suggestion. Very good. Yeah, there is a— and that's why, you know, at the core of that is why I getting a degree, getting a 4-year degree as a promise of success is a lie.

Correct.

Because if your EQ sucks and you got a 4-year degree and you graduated cum laude or magna cum laude, either one, you're still gonna suck at your job.

That's right.

You're not gonna be able to pull it off because you always have to do this with people.

A lesson somebody taught me, of all places, a casting agent back when I was 21 years years old in Los Angeles told me this wisdom, and it stuck with me when I was 21 years old. They said, there's about 10 people in this town— this is back when Hollywood was, was buzzing, and, you know, in the late '90s— there's about 10 people in this town that can run roughshod over everybody and kind of get away with it because they're super mega ultra stars. He said, but most casting decisions are made on this question: do I want to spend the next 3 months with Do I wanna spend the next 2 months with that person all day, having dinner with them, waking up in the morning in the makeup trailer? And most decisions are made, cuz there's a lot of talented people. Most decisions are made, is this a good person I wanna be around?

Yeah.

And that stuck with me.

Like, do you play well with others?

Be a good person to hang around.

Yeah. That puts us outta the Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.