Transcript of Get in the Driver’s Seat of Your Own Life New

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Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network in the Fairwinds Credit Union studio, this is The Ramsey Show. And I am Rachel Cruze hosting this hour with Dr. John Delony, and we'll be taking your calls. And the lines are open. So give us a call at 888-825-5225. All right. First up, we're going to Little Rock, Arkansas, and we have Dylan on the line. Hi, Dylan.

Hi, how are you?

Hi, we're doing great. How can we help?

Well, I'm being kind of in a situation and I'm trying to figure out how to dig myself out of a hole.

All right. So what's going on?

So, um, I'm 28, you know, I'm married, got, uh, 2 kids, a 5-year-old and a 3-year-old. Um, about 3 years ago, we were kind of in a situation. Um, we were renting a house. It was just disgusting. It was mold-infested. Um, our second was on the way, and we decided to buy a house, and it was not really a great time to buy, but we didn't really have an option. Um, I don't feel like we've really bought out of our means. It's just been a lot of things happening leading into it.

Okay.

And then attacking stuff on top of it. Um, bought the house for about $149,000. Um, we were doing good. My son got really sick, started, you know, developing seizures. Um, we fought that for several weeks, destroyed the nest egg that I had put back for us. Missing work, trying to stay caught up on bills. Um, we ended up falling behind on the mortgage and I had to refinance it for a higher interest rate, um, and a longer term. And every year the payments just steadily gone up and up and up. Um, we've got some vehicle payments and some other loans and stuff like that that are just kind of tacked on top of it. And we're not necessarily like extremely behind. I'm, I'm running about a month behind right now, but I can't seem to get caught up, to get ahead.

Yeah, yeah, you sound tired. And the situation which you laid out to us, it's a lot. There's— you have a lot, uh, that you guys are juggling. Okay, so how much are you making, um, per year?

So me, I'm making right around $82,000 a year. Okay. Um, my wife just started a new job And roughly what she's making is supposed to be around $35,000 a year, but she just started.

Okay.

She gets paid once a month and we don't even know what a full paycheck of hers is going to look like just yet.

Okay. So she's not received a paycheck from that yet. That's what you're saying. Okay. Um, okay. So household income per month that's going to hit your account. I know you don't know from your wife, but if you know what she's making, I mean, So you guys probably are going to hit around $10K, would you say?

Not quite. I'm, I'm bringing home roughly $4,400 a month after taxes.

And $44, but you make $8,200, right?

So that's with a— they, uh, give us a tool bonus that's like $1,600. Um, after taxes and health insurance and everything, I'm supposed to be bringing home around $1,500 before taxes, and I'm bringing home right at about $1,100 to $1,200. So between $44,000 and I guess maybe a little bit more per week.

Did you get a big tax refund?

No.

In April? Okay.

Are you—

are they pulling anything out for retirement?

Uh, I did put a stop on it. I was putting in around 9%, um, but then I found out the company doesn't start matching until after the first year. So I was like, well, I could use the money now. So I put a stop to it. And so now I'm just bringing home whatever I get after taxes.

Okay, I would double check.

There's something missing here. You're missing about $20,000.

Yeah, that feels super low. That's like half of your income going to taxes and healthcare. And I don't think that's the case. So I would double check that. I would talk to your HR department. I mean, I would, I would just, I would look through, I mean, you just filed taxes and we just passed tax season, so you should know, but, But for you guys, so it's basically like if she brings home $2,000 a month, $6,400. So what do you, so debt, let's talk about the cars. You said you have two car payments. How much do you owe on the cars?

Yeah.

Her car we owe right around $12,000 to $13,000. I'm not 100% 'cause it's been kind of her thing. I let her take care of her car. She pays the insurance and then, Pretty much everything else just falls on me. I take care of everything else. Um, my truck payment, uh, was kind of stupid. We started talking about it. I needed a truck for the things that I was doing on a little side job that I was trying to help a friend with, so I bought a truck.

And, uh, for a side job for your friends? You're such a good friend.

How much does this truck cost?

Um, $45,000.

God Almighty, Dylan.

Yeah, okay. Yeah, it was— at the time I felt like I could afford it.

You can't.

Okay, how much could you get for it today if you just went and sold it and you guys became a one-car family? What if you just went crazy? What could you get for it?

I would say maybe $28,000 because I went in upside down and then bought an extended warranty on top of it.

Okay, okay. All right, well, I, I, so, um, okay, so you got the two car loans. Keep going. What do you guys have in credit card debt?

Um, I don't really have any credit card debt. I got about $800.

Does your wife?

No, as far as I'm aware.

Okay, so that's another, that's another flag here, Dylan. You guys aren't, you, you don't really know what's going on in your household between you and her. The two adults, no, no, Dylan, the two adults that are supposed to be in charge of taking care of a household and these two kids, you guys don't know what's going on. Like, you don't know what's going on with each other. You can't, you You said that you're— that's her responsibility, the car, and she just takes care of that. And then I'm over— and I'm like, "Are you two roommates?" Like, no. And part of that, honestly though, Dylan, part of the synergy is that you guys are so scattered. You're making decisions on urgency in a situation. You're not coming together and talking about this. That's one of the benefits of getting married is you have two adults sitting in the room with two different brains that you actually get to lean on each other and talk. And you guys are making decisions in vacuums. And you're making them urgently and in desperate situations, which usually always equals bad financial decisions. And so—

'Cause bro, a wife with one ounce of care about her husband would've said, please don't buy a truck that you can't afford for your friends to help your friends, buddies, neighbors, roommates, dog. Like, you know what I mean?

And it's kind of my own fault. Like, it's not—

It is your fault.

I can honestly say it's her. Like really, um, pushing it to be this way. It's been the way that I was raised.

All right. The way you're raised sucks. Okay. So let's do this.

Yeah. 100%.

Starting today, you sit down with your wife and you apologize and say, I've wronged you. I have left you out in the cold. I've tried to do all this myself and I'm doing a bad job and I keep digging us a deeper and deeper and deeper hole. And until you take control, like the only thing that happened to you in this is that your kid had seizures. And God bless anybody who's going through their kid being sick. You guys didn't have to buy a house. You didn't have to buy a truck. You didn't have to just make your wife like, you deal with this on your own. You've gotta, you don't even know what's on your own paycheck, brother. You have to get in the driver's seat of your own life. I'm gonna own this thing.

So stay on the line and Christian's gonna pick up and we're gonna give you guys a year of EveryDollar. 'Cause our goal for you, the very first step, Dylan, together tonight, Sit down with your wife, open up that app, start plugging some numbers in, and use some of the content in there to start creating a step, which are the Baby Steps. You need to get a $1,000 emergency fund, and then you guys need to start attacking this debt. It's eating up your income. You have to get out of debt, and you do nothing with your life, nothing with your life but sell stuff and get out of debt.

This show is sponsored by BetterHelp. Financial stress does not just damage our bank accounts, it can also take a toll on our mental and emotional health and our relationships. Money worries cause anxiety, and they are one of the leading sources of conflict for all types of couples. I know this. My wife and I have struggled with money conflicts for years. Listen, therapy can help even with money conversations. Therapy is not about financial advice, but it can help you build healthier ways of coping, give you strategies to communicate about money, and give you a plan moving forward. I want you to consider talking to my friends at BetterHelp. BetterHelp is an online therapy platform that matches you with a licensed therapist based on your goals and preferences. BetterHelp therapists work according to a strict code of conduct, and they are fully licensed in the United States. You can message your therapist and schedule sessions right in the platform. And if the first therapist isn't a great fit, You can switch at any time for no additional cost. When life feels overwhelming, therapy can help. Visit betterhelp.com/ramsey to get 10% off your first month. That's betterhelp.com/ramsey.

Up next, we have Andy in Minneapolis, Minneapolis. Hey, Andy, welcome to the show. Oh, uh-oh, hold on.

Hi, thank you for taking my call.

Hi, absolutely. How can we help today?

I am recently divorced. I left a 15-year abusive marriage and I'm just figuring out my own finances for the first time in my adult life. And my question is kind of about my kids though. I have 12-year-olds who are incredible entrepreneurs, started their first business 5 years ago, are starting additional ones this year, and they're doing well financially. And I'm I'm wondering how to teach them and guide them about finances when I am so new to this myself.

What are they doing?

Well, a few years ago they started a beverage business and they sell beverages at events and concerts and like vendor shows. And now one is starting a 3D printing business and one is starting, um, a Science Facts YouTube and channel and app and stuff.

Gosh, good for them, Andy.

I'm trying to get my kids to pick up dog poop in the backyard. This is incredible.

Well, they don't do that either, but they're excited about it. Oh my gosh.

Okay, so are you asking specifically like how they manage the money they're making, or is it just more an overall question of, hey, like what—

The money that they're making.

Making, okay.

They understand that business expenses and budgeting, but they are earning thousands of dollars, and I don't know how to guide them other than just put it in a bank account and don't make tons of big purchases. I just haven't had the capacity to—

sure—

learn more to teach them.

Totally. Gosh, so impressive. Um, well, you know, the way I look at it with my kids— I have an 11-year-old, she's my oldest— and so we're starting to talk a little bit more beyond what I'm about to tell you, but I think just starting with the basics of them practicing the 3 big buckets of money, which is giving, saving, and spending. And when you think about it as adults, that's basically all we can do with money, right? You can be more sophisticated within those buckets, but like, that's it. And so being able to do all 3, if you're an adult and you can do all 3 well, you're a pretty well-rounded person with money. I would say you have a pretty healthy grasp on it. It's when people get to the extremes that it becomes difficult, right? They spend everything they make and they're broke, or they save everything and they become hoarders and they're not fun, enjoyable people to be around, 'cause they're just obsessed with, you know, keeping money. Like, they're not generous people in that way. So, I think the teaching them and letting them experience all three is gonna be big.

And so, I mean, we take kind of the old school approach, which is what we tell adults to do, is, you know, give some of your money, have a 10%, like, hey, whatever you make, 10% of it, needs to go somewhere. And that can be at a local church, if you're there. It could be at something that they're passionate about, some type of nonprofit, whatever it looks like. But I think, you know, cultivating the spirit of one of the first things we do is we're givers, like we give. And there's something in that habit that I think is so beautiful. I think saving is really big. I mean, they're getting— I mean, they'll be 16 here, you know, before you know it. And so, I'm like, I don't know if there's a really big purchase that they can be working towards, like a car. And I don't know if they save for half, you match half. I don't know what that looks like, but that could be a really good tangible goal. And for some 12-year-olds, it probably feels far away, but yours sound like they're pretty in line with looking at big numbers, right?

Which would be like a bigger purchase, like a car. And then letting them enjoy some of it. And then letting, you know, having a percentage that they enjoy some of it. I mean, they are 12, you know, and they're making great money. So if there's something fun they wanna buy, then that's great too, right? So, I think not being legalistic about it, but I think the 3 rhythms of that give, save, spend, I think is gonna be really big. And that's more the tactical side of money, but there's also the emotional side of that contentment and that, you know what I mean? Like, there's the emotional side of money, but for now, that's probably where I would steer you from a tactical side.

00:14:35

And I'll just tell you, I wouldn't tell you to do something I don't do in my own house. My 10-year-old, she actually works a lot. She's always looking for ways to make more money. And my, I have a recent 16-year-old who, since he was 12, he's been saving up for the truck he just bought. And so, but we just put it in a regular checking, I mean, regular savings account. And even for my son, my wife connected it to a Till account. I don't even know what that is, but that's how she pays him and puts it in there. And, but we don't mess with high yield savings accounts or any of that kind of stuff for our kids. When you say they make thousands, do they make $3,000 or do they make $20,000?

Okay, well, it's been, I think, $8,000 each overall, like, for the past few years. But the one has like $5,000, and he asked me about investment accounts the other day, and like, I have no idea.

So the lot— the line, the standard line is the biggest investment you can make right now is in you. And so let's say we're going to pay cash for a car, we're going to put some money away for schooling if we want to end up doing that. If you want to start this as a— if you graduate graduate from high school and you want to decide you want to go full-time into entrepreneurship, you're going to need some seed money. And so the line that I use in my house is the biggest investment you can make right now is not in market returns, it's in you. Then when you get out of college is where we want to start looking at big market returns.

Yeah, because for a lot of investing, it is for a long-term— it's a long-term mindset. Like, you know, especially retirement investing, you're going to touch it till you're 59, right? And a 12-year-old doesn't need to be thinking about that, where the math is fun and for them to understand logically, my parents said that, they taught us about mutual, like, this is what this can do. But the reality is you're gonna need cash on hand to buy a car at 16. You're gonna need cash for college. You're gonna need cash. I mean, my parents even told me, when you graduate college and that transition from college to the real world, whether you need first month's rent and last month's rent for your first apartment, you gotta buy, you know, furniture. Like, there is, in the next 10 years of his life or her life, they're gonna need cash. And majority of people don't even have that. And so they end up, you know, in the negative as they start adulthood. So having that there where compound interest and everything, they're going to be fine if they start investing at 21, 22, right? So I really, in my mind, I wouldn't because I wouldn't even put money in like, oh, buy a stock here and watch it grow.

'Cause we don't even teach single stocks. Like I wouldn't even get in the habit of that. So I would have a tangible thing that they're saving for. That they're invested in. And usually, the car is it for most teenagers, which is great. And then, "Hey, where can we continue to enjoy some of this and give some of it?" And Andy, I'll say to you, I mean, kudos to you. We always say, "More is caught than taught," which is so true. And in your situation, what you've just walked through, as you just flippantly kind of said it at the beginning, like, "I left an abusive marriage and I'm on my own." I'm like, you are incredible. And so, having a mom who is— figuring this stuff out and has the humility to learn and to ask and be curious about all of this, like, they're gonna learn so much from you too without you even saying a word. So, your example already of what you set for them is beautiful.

And bring them in. Bring them into light bill conversations and bring them in. Like, if you wanna do a basic run-through of your budget, your kids are pretty business savvy, show 'em what stuff costs. And you'll see your kids start to turn the lights off. And you'll see your kids looking at, like, they'll, they'll bicker with each other. Like, it's at 74, let's move it to 76 so we can say, like, you'll see that kind of stuff happening, but let 'em watch you figure it out. I, it on, on not all the time, but a couple of times a year, I'll hand my tithing check to one of my kids. I want 'em to see that check.

Mm-hmm.

And they'll look at me all wide-eyed and I'll say, mm-hmm, it's not our money. Right. And they're like, oh yeah. Oh yeah.

Oh yeah.

Right. But that, I don't like showing anybody that stuff, but that's how they're gonna learn. Oh, my, my mom and my dad put their money where their mouth is.

Mm-hmm.

Right. So bring 'em into some of those conversations.

How open are you like with the kids? Like, do I share income and all that?

My, my kids don't know how much money I make. Um, I don't give them like, mm-hmm. Because, and I don't tell 'em, I, my son knows that I've got a college account. He does not know how much money's in that account. Because it's not his, because he'll start, he'll start spending it.

Oh, Dad.

Um, but, but I, um, I do show them how much stuff costs, and that, that is, that's been really eye-opening for everybody. And my daughter's 10, she's starting to come into those conversations with us.

Okay.

Yeah, I, I think it is hot. I mean, that, that 12 13, 14, they can start to grasp things. And if they know how much it takes to run a household and be an adult, from car insurance to health insurance, life insurance, to the light bill.

Even my son, he—

Netflix, Disney+, all these things that we have bundled together, here's how much this is. Yeah.

My son the other day just said, hey dad, I think I'm gonna drop outta high school right now, get a job at McDonald's and start, like, I just wanna start making money and whatever. And he had factored in rent and I was like, okay, what about this and this and light bill? And he just goes, All right, I'll stay in school. Right.

Just not—

but it's just, it's, it's, it's part of their growth process. But you aren't less than just because you don't have this stuff all dialed in. Let 'em watch mom learn and that'll be the greatest gift you could give them.

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Hi, thank you so much for taking my call.

Absolutely, how can we help?

Okay, so my husband and I started the EveryDollar app a couple months ago. He started listening to you guys and then got me on board. And we ended up selling our truck and taking out a personal loan for the balance and about $50,000 knocked off of our debt.

Yeah, good job!

Yeah, so we were super proud of that. And now we are actually evaluating if we should sell our house and use the profit to wipe out the rest of our debt and just get a clean slate, rent for a couple months, build up an actual down payment the right way, and just be able to kind of fast-track getting debt-free. So, um, we have a significant amount of debt. So I can kind of list it out. Our monthly income is $11,700 roughly. Um, he's flat rate mechanic and I'm a nail tech, so it varies.

Okay.

Um, but that's about what we're bringing in a month. And then we've got, um, his student loan balance is $3,650. Um, we've got a credit card for $3,600. Um, our tax balance for this year is $5,277. Um, the personal loan for the truck balance ended up being $7,500.

Okay.

Um, we've got a solar loan attached to the house for $31,300, which we're hoping will be assumed by the next owner. Um, that would be the goal. And then my no net balance, or my student loan balance, is about $47,000.

Okay. Yeah, and you had me.

I was like, oh, you're gonna be able to do this, and then it's like, oh, $70,000 more, $75,000.

But you guys, before tax and stuff, you guys are running what, probably $130,000?

Um, I think so. My husband would know that better than me.

Yeah, yeah, $130,000, $140,000.

Do you have little ones?

Yes, we have— well, we have 3. We have 15, um, 12, and 10-year-olds.

So, okay.

And how much is your mortgage a month?

A lot. It is $3,032. And we, in 2 years, have only knocked down $10,000 on principal on our house.

Sure.

So we're like paying interest.

Yeah.

Yeah, it's not crazy though in relation to your income. I thought you were gonna say it was gonna be like a $5,000 mortgage or $6,000 mortgage.

No.

So it's, so yeah, your house, I don't think Lauren is the problem. I mean, genuinely, like we say 25% and you guys are a little bit above that, that. But I think, um, I think over time you guys will get within that range pretty quickly.

Um, what's, what's the opportunity?

Go ahead. I'm sorry, I think where we're at is we still owe $412,000 on this house that we're not necessarily wanting to— like, our kids are getting older, they're getting into their teens, and we're kind of thinking about like the next 5 to 10 years, do we want to put another $400,000 into this house that we don't need this much space, you know, either. So it's like, that to me is— that out and start over.

Lauren, that's the question. Yeah, like, if, if you don't love this house and you don't want to live there and y'all want to downsize, but that's awesome.

My gut tells me it's just a lot of house.

Yeah, sure.

No more kids in a few years.

Sure.

I, I— part of me thinks that the grind is what y'all need.

Okay.

Um, that just getting up every day and figuring out, hey, can he take— can he go work in somebody else's shop on Saturdays? And can he— and all this is hard because y'all have kids entering in those ages when you got a 15-year-old, you start counting the days, right? Like, we got, right, 3 years and then he's gone, right? And so I get all of that. Um, if you told me, you know what, dude, we're gonna sell this house anyway when, when one of our kids leaves and we're gonna just gonna be 4 of us, then yeah, sure, put on the market and sell it, especially if wipes out all of your debts and whatever. I think you're being pretty optimistic about the solar loan getting absorbed, but maybe not, maybe not.

Um, but we assumed it, that's how we got it.

Okay, okay.

Bought the house and it's kind of a thing in the— in our area. Um, yeah, so I'm not worried about that. I'm more worried about when I spoke to a realtor this morning, she said we're probably not going to get close to what we would need to in order to cover realtor fees and closing costs because apparently a buyer's market right now. And so how long have you been in the house? Profit would— we've only been here for 2 years in this house.

Oh, so you don't have equity in it?

Yeah, not much.

Okay, then for sure.

She said we could probably— she said we could probably sell it for $460,000 to $470,000. We owe $412,000. So that would pretty much cut— yeah, you know.

Okay. So Lauren, that would be the trade-off. So listen, if you— if you guys decided to do it, do that now. You wouldn't get— you would you make a ton? What would you make on— because you said you would barely cover all the fees, the realtor fees and everything. So you really wouldn't make a ton to pay off the present debt. It would be more of a future of saying, oh, we only have to pay off a $300,000 mortgage versus a $450,000. And you guys feel like you can swallow that easier, right? Stomach that easier. So what I would— what I would suggest, though, is I think that's a— that's a long-term problem that you're seeing and feeling that actually may be relieved once you're debt-free from consumer debt.

Yeah. And, and you're going to have to turn around and get— rent a house for $2,500 for 5 people minimum, right? Probably $3,000.

So, yeah, save us a little bit.

It would save you a little bit, but I, I don't think that's the big rock here. The big rock— I mean, if you told me you were going to be able to save $3,000 a month or you had $100,000 in equity, that would make sense, but This isn't moving your position anywhere. It's— it's—

in fact, it's making your life more complicated because you guys have about $6,000 left after you pay the mortgage. Where is that? Where's all that going?

We just recently— I said we just started the EveryDollar app. We were eating our money as they— yeah, yeah, yeah.

So, Lorna. Yeah.

So we've gotten better on it. But yeah.

Yeah.

So what I would say is what's crazy about when you look all this out, and I just, I did a rough map real quick of a calendar for you all. But I'm like, if you could find $3,000 a month, that's finding in EveryDollar the expenses, which actually probably $2,000 of it could be sitting in there that you don't know about when you just actually shore everything up and say we're not spending anything. And then you guys go make some extra cash on the side, and in that example, it would just be an extra $1,000 of you working a little bit more or him working, you know, a Saturday or two a month. You guys could have your $3,000 debt knocked out, your credit card debt knocked out, and his student loan debt all by August. Like, if you threw $3,000 at this stuff every single month, and then you're down to the $7,500, and you can knock that out in 2 months, right? And then you're looking at the solar and your student loan debt, which will be, those will take longer for sure. But I'm just saying, a lot of these ankle-biter stuff, if you guys really, really tighten up and say, "Hey, we are going to spend nothing.

We are going to work extra, and we're gonna put 3 to 4 grand more than what we're doing today on this debt." You know, 2, 2 and a half years, you guys are out.

You know something we do in my house?

Okay.

I actually, part of my kids', I don't use the word allowance, but part of the things we pay them for is each kid does one meal a week.

Mm-hmm.

And so it's tough if you're working nail tech all day, you're, you're exhausted. Your husband's underneath machines all day. That, let's have your, you got 3 kids, have each one of them be responsible for a meal, pay 'em each $10 a week for cooking or whatever. They get to earn a little tiny little bit of money, but y'all save a jillion dollars by not eating out all the time.

Yeah, we've done a lot better this month, but yeah, it's still pretty significant. Like we need to cut it out completely. It's just kind of, we're trying to ease into it to figure out. Don't ease into it.

Cannonball. Cannonball, baby.

For sure. Yeah. And, and you know what, Lauren, I would, I would just, I would grind it out because you guys, if you guys had $300,000 of equity and you're like, we want to downsize or something, you know, you could make it make sense. But right now it doesn't because you don't have the equity, which you guys are barely going to even just break even on a problem again that is so far in the future. I would fix this stuff in 2, 2 and a half years, um, and then you guys look up 5 years owning the home. If there's some equity and you still want to downsize, then I would make move.

Dave, we got a lot of calls on this show where life happens.

One day someone's healthy, they're working, providing for their family. And then a curveball hits.

You know, we hear it all the time. A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes.

Yeah, and that's why you've always said that having term life insurance from Zander is essential because it protects your family if the worst happens.

Yeah, that's right. You need 10 to 12 times your income in coverage. No gimmicks, no whole life junk, just straightforward term life protection. But there's another piece that people often overlook, and that's long-term disability insurance.

Yeah, it's important to understand the difference between them. Life insurance steps in when you die. Disability insurance steps in while you're alive but can't work. So it replaces a large part of your income so the bills still get paid while you get back on your feet.

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All right, next up is Andrew in Salt Lake City. Hi, Andrew. Welcome to the show.

Hi, thank you guys for taking my call.

Absolutely. How can we help?

So I'm 22 years old and I make $120,000 a year, and I have been since August, but I've been in my career for about 2 and a half years now. Um, and I kind of have a car question. So I currently drive, or I used to drive, an older Toyota Tacoma. Um, now I had that and then I had a '24 Corolla Hybrid. Um, so it's kind of like my commuter. I drive about 25,000 to 30,000 miles a year. Um, but I ended up selling my truck because it ended up getting into an accident. I sold it for $500 more than I bought it for. Um, and I was kind of wondering, you know, if I could be able to get into maybe another truck or a 4Runner type vehicle, just because I got 3 dogs. I like to go camping, fishing a lot. That's like what I— my main hobby. Um, I have about $25,000 in savings and $25,000 in investments, 401(k), Roth IRA. Um, yeah, kind of curious what I would be able to do.

And so what are you currently driving right now?

A Corolla Hybrid.

Okay, bro, that car is gonna— just as on the side, uh, my wife got a Corolla right before we got married and I drove it forever. Um, and I just said, as soon as this thing dies, I'll get myself something else. I finally gave up. That car will never die. You'll have that Corolla till the end of time. Forever.

I know.

And that's why Andrew's like, I don't want it.

And I drive. Yeah. I, I drive for, I drive a lot for work, so I get paid about 75 cents a mile. Nice. So the car's basically free.

Yes.

But it's, it's about $19,000 on the note. Um, which I haven't paid a dime towards because—

Oh, you owe $19,000 on the Corolla?

Yes, I do.

Oh, okay.

Yeah, if I owned it outright, I think it'd be a different story, but I would pay that off before I bought anything else.

And I know that's like, dude, I'm an outdoorsman, I know that's like a kick in the teeth, but running— you're one getting laid off, or you're one they're gonna reduce the mileage, or they're— you're one— your, your current situation is based on somebody else's decision. And we wouldn't have jobs if people didn't, weren't faced with that every single day.

Yeah, how much is it worth?

My trade-in value is about $26,000 right now.

Oh, it's worth $26,000. Well, if you could figure out a way to finagle selling it and putting a little bit of money of your $25,000, you gotta pay it off and have a little bit to put towards something and get a used, paid-off car or truck, I would consider that if you wanted to do that. But the thing is, is I, you're technically on Baby Step 2, right? So when you're working the Ramsey plan.

Yep.

And if you paid off the car, you'd have $6,000 and a $25,000 paid-off car, technically, right? 'Cause what you said it was worth, you get $25,000 for. Is that what you said?

Yeah.

Yeah.

Yep.

So, if that's the case, you got $6,000 in savings and a $25,000 car. If you wanted to trade the $25,000 car for a $25,000 truck, you could do that, right? Like, if you wanted to get something that you wanted, I'd be okay with that. And then you gotta beef up that $6,000 emergency fund to a, probably a 3-month emergency fund for Baby Step 3, and then go on for investing all of it. But no, you don't need a, brand new truck, and I don't think you need anything worth more than the car you're currently driving once it's paid off.

I agree. Um, I guess the question after that would be, uh, for my mileage per year, being like a high mileage driver and especially being forced to for work, how do you think that factors into like the, you know, how people talk about the affordability of vehicles and kind of how I'm essentially bottlenecked into a certain type of vehicle as gas mileage because of your work. They don't pay for fuel.

Yeah, well, that's gonna have to be a decision that you make. I don't know, Andrew, do you want to pay for the truck mileage, you know, and, and the gas for a truck? Yeah, that's— that would be your decision. Can you do that in your monthly budget? Is that worth it for you?

Well, 75 cents a mile should cover that, right?

Yeah, it covers it.

Um, I mean, that's, that's what that money's right now.

Yeah, I'm profiting about, I would say, $35 a gallon of gas.

Are you trying to figure out how to keep the Corolla and get a truck?

That's what I wanted to do originally. Uh, as that's the setup I had before.

I wouldn't do that until you— yeah, I wouldn't do that until you paid off the Corolla. I wouldn't do it till you paid off the Corolla and paid cash for a truck. Cash for a truck.

Yeah.

Yeah. And, and by the way, dude, I like, until last year, my daily driver to work was an '06 Tundra that got like 1.5 miles a gallon.

Mm-hmm.

But it was awesome. And it will, again, we'll go to the end. You're a Toyota guy like me. It'll go till the end of time. Right. And so I, I wouldn't use this as an opportunity to upgrade cars and get a newer Tacoma or get a newer 4Runner. Like if you're gonna buy a camping car, I would buy a camping car. Right. But even then I wouldn't do it until after I'd paid off that Corolla. You, you, I, I think you, you say you're 22 or 23, is that right?

Yep.

Okay. I'm trying to picture myself at 22 or 23 making 100, 120 grand, which I wasn't even anywhere near that world. I can't imagine that you don't think, feel like you're rich and you are for a 22-year-old. The check.

No, you'd be surprised. I, I really don't.

Okay. Well, he, If you, if you're getting 75 cents a mile and you're driving and you're making $120 grand, you're doing insanely well for 22 years old. I want you to listen to two people like years after 22. You're literally one email away from your boss saying, hey, we're going, we, we can't afford it because of conflicts in the Middle East. So we're gonna go down to 25 cents a mile.

Or, or we're cutting jobs.

We're cutting jobs. Yeah. Or whatever. And man, you're just so exposed right now, even though it doesn't feel like it.

Mm-hmm.

Yep. So Andrew, we would pay off your Corolla today because you have the money for it. And then beyond that, if you want to trade the Corolla for something else, you can do that. Or if you want to save up on the side to get a truck or a camping thing and you want to, you can just pay cash and buy used.

And this sounds cheesy, man, but if you look at your actual life, I remember one time we, when my wife and I moved from Houston and I didn't wanna move cuz I was like, man, we go to Astros games, we go to concerts and all this. And she said, all right, how many baseball games did we go to last year? And I was like, I was like, okay, 2. And she said, how many trips when we were living across the state did we go back to Houston to see games? 2. Right? And so it was like, if you look at your life and you actually go fishing once a month, go rent a truck. Go rent one and drop it off. And it will be $150 or $200 and call it good. Turn the keys back in and keep your life, keep your cash to yourself.

Yeah, or God forbid, just take the Corolla.

Take the Corolla, pile the dogs in.

I mean, honestly, like—

Put your tent in the truck and call it, man.

Yeah.

Enjoy your life.

Yes, yes, absolutely. I know. When you put so much of your money, and especially you starting off, Andrew, like you got $25,000 in retirement, which is great. $25,000, you're doing some great stuff. But when you start to shift that money focus to more consumer base. Ooh, I want this.

Especially depreciating asset things.

Especially a car, right? That you're like, okay, I'm going to just add on, add on. You're just, just watch the habits that you're starting to build at 22 is what I would say. That'd be my word of caution of just instead of kind of just figuring it out and just getting what you need to kind of like take, you know, have for your life and be like, yes, I need this car. Not so much great for work, but great for my leisure activities or whatever. That's fine. But yeah, buying the two cars right now, I don't know, it just feels, feels excessive.

Here's my promise. 42-year-old you will wish when you're married, you got some kids, 42-year-old you will wish you had a whole bunch of money in the bank, not two cars when you're 22. And just think about 42-year-old you. You'll be able to go on some wicked awesome camping trips when you got cash.

Yep, for sure. But you're, and you're almost there, Andrew. Again, hear us say like, You're on the right track.

You're dominating.

But again, pay off that car today. You have the money. Do not be paying a car loan with interest on a depreciating asset for another month. Don't do it. So just pay it off. You'll have the $6,000. And then actually, when you start working with cash, Andrew, it kind of changes your mindset. It makes you think twice about something, right? When you have debt and you're like, okay, I can afford that payment here or this thing over here, 'cause it's just these small payments month to month, it doesn't feel like a big deal. But when you actually start living within your means and spending your own money, it actually changes the game and actually may change your mind once you have it paid off and you're like, man, I don't know if I want to spend or save up for another car. I kind of want to save up and start investing or doing something else with this money.

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Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. I am Rachel Cruz hosting this hour with Dr. John Delony. So give us a call at 888-825-5225. All right, let's go to Minneapolis. I'll pronounce it correctly this hour. And we have Monica on the line. Hi, Monica. Welcome to the show.

Hi, I'm a huge fan.

Oh, thank you. Well, thanks for calling in.

We're a huge fan of yours, Monica. So what's up?

So I have a question. We're just kind of having a debate, my husband and I, about how much I should be spending a month. And I want to be within budget, but I'm kind of confused on what's acceptable and what's not.

Less than your budget.

Ta-da! Great, there you go.

Okay, okay, so I was just— I'm just messing with you. What's your confusion? Me and Rachel love solving marital disputes, so we're going to solve this.

We love spenders like you, Monica. We're glad you called.

Well, I used to not be a spender because I had no money, and then we had children and they need all the jeans.

Oh, are you one of those moms that likes your kids to have shoes and stuff?

Yeah.

Boo!

Boo!

Yeah, I just feel like the kids' expenses just pop up, you know. She's rough on her tennis shoes, and the next thing you know, like, she needs a new pair of shoes.

Totally, totally.

So what's your husband upset about?

I do spend too much, but that's what I asked. I said, well, do you want me to stop going to the personal trainer, which spend too much money on, but it is really beneficial. She's more of like a physical therapist and has helped my back get a lot better.

Okay.

Um, so nope, not that. He's like, you don't— you're not into like brand names and all that, so I'm not worried about what you spend on clothes. And, um, not worried about hair salon, you can always go there. And I was just like, so what then?

It's almost like he just has this random feeling, there's no like actual hard data.

Well, I am spending too much though.

Um, why do you say that?

Our house is— our house is— our house is paid off, our cars are paid off. I don't know how much insurance costs and things like that because I'm kind of a child when it comes to like that end of who's in charge with our relationship. But, um, I'm spending $12,000 a month and I know $2,000 is on groceries, $150 is on the gym, $480 is the personal trainer, $200 a month on hair. And then I don't have a tally on all the things.

There's a lot left.

Yeah, where's the other $10,000?

Right, I know, I'm racking my brain. And I think it's— I mean, I garden, so we'd buy a lot of stuff for the garden. And when I say garden, it's— it's, yes, some flowers, but it's also a lot of vegetables and stuff.

Yeah, but we do that too, and my wife collects seeds. And like, I don't know how big your garden is.

How much do you guys make a year?

Almost $400,000.

And you're completely debt-free.

My, my big concern here is that you don't know where $10,000 a month is going because y'all are like— I'm gonna say this nicely, but y'all are wealthy. Y'all are doing really well.

I'm not offended about anything you say.

No, I know, I know, I know.

But like, I know you're a nice person.

Y'all are doing really well. My concern is it, it, it's, I, I'm in your husband's camp here that I want my wife to spend what she wants to spend. I want her to feel good. I want her to do all those things that make her who she is. And then there's $10,000 more a month that are unaccounted for.

Mm-hmm.

And I, I'm troubled here that you don't even have a ballpark.

Yeah.

Like you don't seem to have any idea where that money's going.

Doing?

We—

I, I'm that mom that like every holiday has to be super special, but I know that I decorate for all of it. We have a trail in our backyard that I decorate for Halloween, and then we decorate it for Christmas, and we decorate for Easter and their birthdays.

And yeah, so you're dropping like 2 grand on something like that and not really thinking much about it? Probably like it'll be that kind of stuff that you're doing. Okay. Um, okay, so You're spending, you said $12,000. You guys, what hits your account every month? Probably $30,000?

I don't know.

Okay, okay.

So here, because it's inconsistent, it's a— I don't want to get into details, but it's a job.

Okay, that's fine. Okay, do you guys— are you guys intentional with how much you're giving and saving every month? You all have goals?

He is super good with that stuff. He has investments and things. He showed me paperwork, and I think I have dyslexia with numbers.

Okay, so I don't know. You don't. Okay, I'm gonna have a hot take here. Okay?

Okay.

Because of how much you make, considering everything is paid off, okay, y'all have not, you have, you're fine. If you're investing, I'm gonna pretend, Monica, that you guys are investing in retirement. You have your future is being taken care of, the kids' college is being taken care of, you're giving. I'm gonna just assume you're being very responsible people. You're at a high bar. Okay?

Yeah, we have a fund started for retirement.

And then you have, you know, $25,000, $30,000 left a month. Month. Okay, hot take. If everything else is taken care of, the number doesn't like super throw me off. It's not like you guys can't afford it. Here's what's throwing me off. Two things, Monica. Number one, you personally don't know where this money's going. There's no line item for Easter. And God forbid Monica puts, for some people, they're gonna think you are insane that you're gonna put $1,500 for your Easter trail.

I know, but—

But that's where you're choosing to spend it. And you have it, Monica, so I wanna stick up for you. 100%.

Even that, you just said Christmas, Easter, and Halloween. If you spend $2,000 a month decorating the trail behind your house, that's $6,000. You spend double that every month.

Okay, so that's what I'm saying though, is like you, at least if I knew you knew where this money's going and you had a self-check of like, okay, that feels right for me and X, Y, and Z. Everyone values different things. Everyone throws their 1-year-old a a birthday party looks like a wedding reception. I don't get why, but people do it, and it's fine. If you have the money, I'm not mad at you. It's not a moral thing. So, this is where, so, I wanna fight for you in the sense of like, you guys have done so well, okay? And you are allowed to spend some money. But the problem is, back, I'm rambling. One is, you don't know where the money's going, Monica. Big problem. If you could map out exactly what's going on, then we can actually have an adult conversation. And then number two, you don't know what's going on with any of your money. Like, you've said, you've deferred to your husband 3 or 4 different times on this call, and that's a problem. That's a problem.

I think your husband's statement, "You're spending too much," is, if I got to the thing beneath the thing of that statement, it is—

It's out of control.

You're immature in this relationship and I'm having to do all this by myself.

Yeah. You're more like the child and he's having the parent that's having to take care of everything.

He doesn't wanna be your dad. He wants to be your husband.

Yes.

And that means you—

You have to be a partner in this.

You come to him tonight and say, "I've acted like a child and I'm sorry." I wanted, I don't have dyslexia with numbers. That's not a thing. I don't know how all the investments work and whatever, but I do know how addition and subtraction works. I wanna know how much we make. I wanna go through our statements over the last 3 months and go line by line. I wanna find out where this money's going.

Yes.

And I promise that if we make a budget, I'll stick to it.

Okay.

And Monica, and it's gonna be a good exercise for you because part of handling money, if the numbers work, like, right, that's our first big check mark I feel like is like when we look at the data Do the numbers work? And yes, you're not going into debt for this stuff, like the numbers work, but there's also a spiritual component to money that you're not being, you're not being a great manager of your money. You're sloppy with it, right? So again, I'm not mad that you're spending money, but you're spending it on impulse and what feels good and what I need to do in the moment.

And with no accountability.

And that's not a good character-building moment. You need some discipline in it, again.

And your husband needs a partner Yes, yes.

So, all those things combined, Monica, you guys may get to the end of this and say, "Yes, we're still gonna spend $1,500 on the trail." And that's fine, because that's what you're deciding to spend. But at least you're doing it as an adult with a rational thought behind it as a good manager.

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Up next, we have Bruce in Philadelphia. Hi, Bruce. Welcome to the show.

Hello. Thank you for taking my call. How are you?

Yes, we're doing great. How can we help today?

Well, I have a question. Um, I'll give you a little background. I'm 72, I'm retired, I have roughly about $1.3 million, um, and I also have a retirement income of about $150,000 before taxes. And I'm looking to do some— well, I've been investing mostly in CDs. I don't know if I should continue just rolling over those CDs or going into something a little more aggressive.

Yeah, for sure. So is the $1.3 million in CDs?

No, the $1.3 million is, um, some of it is in IRAs and the rest of it, yeah, it's spread out. Yeah, it's spread, some of it spread out into CDs. Yeah.

Oh, okay. Some of the $1.3 million. How much of the $1.3 million is in CDs?

Uh, about $500,000.

Oh wow, okay. Um, and the $150,000 that you're living off of, is that coming out of the $1.3 million?

Uh, some of it is. Most of it's coming from retirement pension and Social Security.

Oh, okay, great. Awesome. Um, well, yes, short answer is yes, Bruce. I would move for sure. That $500, yes, into the market, yeah, of investing it. I mean, it would be, you can look into different types of mutual funds, you can look at index funds, but with the market, kind of the rule of 72, just the quick math, is investing it, usually you double your money in 7 years. So in 7 years you would have $1 million, 7 years later you'd have $2 million. Where CDs, you're making like, like, is it 2, 3%?

Yeah, 3.7.

Yeah, I mean, you could move it all into a high-yield savings account and make more than that.

Yeah.

And if you move, if you move half a million dollars, somebody will give you 3.5 or 4% on that money. What are you at right now, 2.75%?

Can you repeat that? I'm sorry.

What, what are you, what interest are you generating on those CDs?

Uh, some of them were at 4-something, and I think, yeah, well, so, okay, yeah. So if you think about it, the market, I mean, it's, I mean, again, depending on your, it's kind of so volatile. I feel like this calendar year, but overall you're going to, on average, safe is 10%, so, and that's just safe, right? Some, some years, I mean, the past, what, 2 years it was like at 23%. I mean, it was just crazy. It was crazy. What you can do. So, and especially since you don't need the money, right? 'Cause you would, you do wanna kind of let it ride out in case you put the money in and if you needed it in 2 months, you know, take some out. You know, that wouldn't feel great if it was dropping a little bit, but letting it all kind of just, you know, have some time to settle into the market and let the market settle, right? Its ups and downs. I would for sure, Bruce, yes, I would put that into the market instead of CDs. Without a doubt.

Okay.

Or to put it in a different way, neither Rachel nor I put our money in, have $1 in a CD. So it's not like us just telling you something hypothetical.

And I don't think we've ever once told anyone to put money in CDs either, Bruce. So yeah, it is, from the track record of what the market's doing, it is safe. And I understand even at your age of being cautious with it, right? And saying like, okay, where are we at? But honestly, 72 still is pretty young. I'm like, you could And if you're in good health, you could have another 20 years. Yeah, I mean, seriously. So, so no, I would definitely put it in the markets. Not only because it's the best investment, but also you don't need the money. The income that you're getting is from pensions and Social Security. You're not even using most of it. So if there is a little bit of dip and you don't need to take out as much, it's not going to hurt that bad. So it's a great question. And Bruce, well done.

Yeah, excellent, brother.

Unbelievable. Unbelievable. All right, let's go to Tibby in Jacksonville. Hi, welcome to the show.

Hi, how are you guys today?

Hi, we're doing great. How can we help?

Um, so I— we have kind of an interesting situation. Um, we, we have about $25,000 in savings. Um, we— the only debt that we have is a travel trailer that we're actively paying off. Uh, we just paid off my husband's student loans. Other than that, we don't have any other debt aside from our house. And, um, through a series of unfortunate events, we— I just discovered that we actually have mold growing on the bottom side of our couch.

Oh, oh, throw it away.

Well, my question is, do we dip into the emergency fund for that? Is that something that's worthy of an emergency fund?

Pull some chairs around, pull some chairs around, you'll be fine.

I know we have a 10-month-old though, that makes it even—

you're 10 months old, you're gonna get a new couch. Your 10-month-old is gonna shotgun out of both ends on that new couch and spill milk on it, which is going to cause more mold.

You don't want anything nice right now. No, no, no, no, I buy it. I wouldn't. So you, you for real would not buy a couch?

I, I, well, listen, you have to understand that it was when my first book went number one that my wife asked, hey, we have a bed frame that you bought off Craigslist for $50 and spray painted. Could we get a real bed? So I'm probably not the best furniture guy in the world to ask, but I would, if it was my house, pull some couches. I mean, pull some chairs, some shenanigans, sit on the floor with your kid or whatever. And by the way, not having a couch in the living room will— you'll have more action with your kid on the floor. Y'all will actually go to bed on time and not rot in front of the TV. It could change your life in a bunch of positive ways. Okay, look, but that's not why you're calling me. I know.

Um, all right, Rooms To Go sofas from $399. I'd be okay if you spend $400 on a Rooms To Go sofa.

I, I'll go with Rachel.

If you have it, I know. And you can't— you cannot take it out of your emergency fund. You got to take it out your restaurant budget or something else. You gotta cash flow the couch.

Yeah, that was my other thing.

Cash flow the couch, yep.

You have a 10-month-old, don't buy nice stuff.

But get a, please get a gross, like, don't get a, I say a gross one. I mean, it can be new. It doesn't have to be old and used and gross. A new couch.

But cash flow it out of our monthly income.

Yes.

And a cheap couch. A cheap couch. That's how I was trying to say it. Cheap, cheap.

Okay, we wouldn't go expensive. We're a military family. Things get broken with every move. Yes, we're pretty— we're, we're pretty basic when it comes to our furniture.

And get a couch. If you have to get a couch, get one that you'll leave when you move. Just leave it.

We can do that. Yeah, that's okay.

Okay, well, and Timmy, you didn't call about this, but you guys have $25,000 in savings. Is that what you said?

Yeah, we have a $25,000 emergency fund, um, all total, like, investments between my IRA, mutual—

how much is on the camper? How much is left on the trailer?

30.

Pay it off today.

She can't, she— they have $25,000.

They're close.

I know.

Yeah, go ahead.

The only reason we have that is because of the nature of my husband's job in the Air Force, it's rather dangerous. So it makes me feel much more secure to have that, um, in the event of something, the knock at the door.

Yeah, I get that.

Does he have life insurance? Do you guys have life insurance?

Uh, we have it through the military. Um, right before he was leaving on deployment, that's the other thing, he's currently deployed, so I'm trying to figure all of this out, but Right before he left for deployment is when we were gonna start going through Zander and getting quotes and all of that stuff. We just pre-deployment didn't have time to get that added on there.

Yeah, I want you guys to do that ASAP. And on you too, Tibby, if something happened to you. And you guys need 10 to 12 times your annual income. Sometimes with people that have insurance through their companies or through the military, it's not enough. And so get term life, check out our friends at Zander Insurance. Because they're an insurance broker that actually shop all different companies to get you the lowest rate. So, um, you guys, yeah, be looking at that for real though, because I understand the safety net of wanting that money. That makes total sense. But also, if you knew that other aspects were being taken care of financially, you would be able to use cash today to help you guys in your present situation get along further, faster to wealth building, which would be off this debt. So you guys consider that. Look at the life insurance, and if there's enough, I would. I would get rid of this. You're paying payments on something and interest that's going down in value. So getting rid of that debt is gonna be huge for you guys.

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We wish we could get to every call here on The Ramsey Show, but we I can't. So if you have a money question though, we have an answer for your situation. So you can go to our website and use Ask Ramsey. So Ask Ramsey is our free AI tool and it's built and trained on proven money principles that we've been talking about. I mean, this whole system that they've built has, I mean, every answer in there is from the past couple years of shows, all of our books, articles. I mean, anything and everything Ramsey has put out content-wise, is in there, and it's wild how personalized it can get because it will remember you and your situation, but you can put in specific numbers, all of it, and it will spit out an answer like you have called the Ramsey Show. So get your question answered today at ramsaysolutions.com at the Ask Ramsey tool. So you make sure to check it out, or if you are listening on podcast or YouTube, we'll put a link below. Alright, let's head to Bill in Seattle. Hi Bill, welcome to the show.

Hi.

Hello, how are you today?

I'm doing good, how are you guys?

We are doing great, how can we help?

So my question to you guys is whether I should continue moving forward with getting engaged with my girlfriend, you know, even though I see her as kind of being financially irresponsible.

Run, Bill, run! No, no, I'm just playing. I'm playing. Tell us more. What does financially irresponsible mean?

Um, it means that she, uh, she still kind of nickels and dimes us to death. So when it comes to those small expenses like eating out and getting a cup of coffee, I, I think there's very very little consideration on her part in terms of how those expenses can accumulate over time. And I guess the other big thing, too, is not a steady source of income from her end so that when we have big expenses like our animal vet appointments, it usually ends up me sharing the financial burden more so.

So are y'all, are y'all living together?

Yes. Okay, so we are. Yeah, I'm, uh, uh, that's so this is kind of all about is I'm a 30-year-old living in my girlfriend's parents' basement.

Oh, there's that. Okay, cool. Lead with, lead with that next time, brother.

Hell.

Um, all right, so how much of this— it's just, listen, it's just two dudes. Rachel happens to be here and like a couple of million people just listen in. Okay. How much of this is you've got to see up close? I don't know if this is a person I wanna spend the rest of my life with. 'Cause here's the thing, I skipped a final exam to run across campus because I knew that's a place that my girlfriend at the time, who's now my wife, would be walking across campus at a certain time, right? So if, if it was really that she spent too much on cups of coffee and didn't work very often and you were head over heels, this was your person, you'd be calling us in 10 years saying she won't get a job and she spent y'all into the poorhouse. What else is going on that's making you start to question this thing?

Um, well, we, we've been together for such a long time and I think we've had our ups and downs, but eventually I feel like recently in my life I've gone through a stage of maturity, and I— and that certainly means financial maturity. And, and I think that is what I have yet to see from her, especially in recent times. And And I know if I want to take that next step with her, that is something that we certainly have to agree.

How old is she?

Uh, she is 28.

Okay, so it's more of a maturity over on who she is, but what you're seeing, what's coming out, is the money side too.

Yes.

And here's— oh man, this is a double-edged sword. All right, brother and Rachel, tell me, knock me off my pedestal like you're so good at doing.

Rachel would love to.

John, my concern here is a double-edged sword. One, you have somebody who who isn't working, seems to be content living at home with her parents, whatever, and never has any money and continues to rack up expenses. There's that. My, honestly, my bigger concern right now is you are starting to feel like you are better than her. And that is, man, that is the, you're tilling the soil to plant the seeds for contempt. And contempt is one of the Gottman's Four Horsemen that will just destroy your relationship. It's you sitting up in the lifeguard tower of a local pool looking down on, instead of sitting with her and saying, hey, what's our plan to get out of your parents' basement? Right? What's your financial future? What, what job are you gonna have? How are we, what kind of future do we wanna build together? And if she won't participate in that, yeah, you've got, you've got bigger issues.

Yeah. Have y'all had conversations, Bill, about it?

We recently, 3 weeks ago, tried to have a completely clean slate where we, you know, push everything behind us in the past and we just look forward and we don't bring up anything that happened in the past. And it seems like I'm getting that sense of financial urgency from her, but then there's still those moments where, again, she has a small unnecessary expense. Or just yesterday, if I may say, she had spent approximately $60 to get us concert tickets. And it's still those things that occur that prevent me from, um, you know, giving her my full trust financially speaking.

Well, it's tough because y'all aren't married, and so I wouldn't tell you to make a budget together because y'all are just boyfriend and girlfriend living in her parents' basement, right? Like, if y'all were married, if y'all were engaged, and y'all were starting to think through, we're going to make a budget together and we're going to high-five each other and stick to this budget that we've made, and then she was like, "Look out, surprise, concert tickets," then yeah, you'd have—

You've broken something that you've set together, yes.

But if y'all are just dating and you've been dating a long time and you're just sitting in your in-law, I mean, in your girlfriend's parents' basement saying like, "Hey, we need to get our stuff together." And she's like, "Yeah, yeah." I mean—

Y'all have created no situation where she has to.

Yeah.

Right, and I hear what you're saying, Bill. I do hear, I wish she had the self, you know, motivation to— yeah, can she keep a job? Like, what's the job situation?

Um, so I have two jobs. I work full-time at Target and part-time as a math tutor at Mathnasium, and I work approximately 40 to 55 hours a week. And I'd say it brings me in approximately $3,500 to $4,000 a month.

And what does she do?

So she just has, uh, side gigs. She does a lot of pet sitting. It's been picking up a little bit because it's springtime and summertime and people want to travel. The other thing, I guess, too, is she does have her mom who owns a lice removal service company, and she has lots of experience with doing that. And that's actually a very nice job because they get a lot.

But she will work it, though.

Well, and That's, yes.

Okay, okay, yes. So, I can feel, okay, Bill, but you're in the same, you're a little bit, I'm gonna group y'all in the same situation. You're both living with, at her parents' house. I hear you trying. He's turned a corner.

You have.

And he's like, I want to do something with my life, create financial stability, and she's pet sitting, which again, nothing's wrong with pet sitting, but that's for a full-time career. If she was doing it 60 hours a week.

Not for a 28-year-old.

Not for a 28-year-old, right? And it could be a great side gig, But like, that you— I, I do see the lack of initiation on her side.

Yes.

And that is very concerning. Yes, that's concerning.

So I see that it's concerning that her mom still speaks into y'all's life, right? So here's the thing, the only thing you can control is you. If I— if you were my son in this exact situation, I would tell you, go get a one-bedroom apartment today.

Yes. Praise God.

I want you to have skin in the game of your life. And you're not gonna, you're not gonna accumulate wealth as much as you want, whatever. And then say, we're not breaking up, but I need to get out of underneath your mom and dad as my parents, and I need to start creating a life as me as a 30-year-old man.

Yes.

And then you can see with clear eyes, is she want to join your team till death do you part, or she want to live under her mommy's roof, pet sitting a few months out of the year, right?

That's what I was gonna say, John. Dude, you wrapped it up.

High five.

Seriously. Yes.

Same thing.

It's going to expose and show more of the truth, Bill. When you are on your own and you have the blinders on for your life, does she enter it or does she exit it?

And you make your budget for your money.

Ramsey Show question of the day is brought to you by Yrefy. If you've lost control of your private student loan payments, your financial progress has stalled out, but Yrefy helps borrowers explore refinancing options with payments built around their real-life situations. So to learn more, go to yrefy.com/ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. May not be available in all All right.

Today's question comes from Andy in Kansas. Andy writes, my wife says I'm taking the baby steps too seriously. Andy, there's no such thing.

All right.

Um, because I'm very focused on paying off our debt using the snowball method. She wants to pay off debt, but would like us to save for a vacation and build a larger emergency fund at the same time. We have the $1,000 starter emergency fund, but she wants to increase that amount, slow down a bit and not be so intense about paying off debt. I don't want to create tension. 'tension between us, but at the same time, I really wanna stay focused on becoming debt-free. How can we stay united as a couple while making progress towards our financial goals?' This has to be the number one question we get.

That one person is like—

All in.

All in, and the other's like, "It'll be fine." And one person's like, "Dude, take a few Xanax and relax." Yes, yes, totally. Yeah, and I think for me, it's one of those gives and take, give and take, gives and takes, give and takes in marriage. Because there is, there's naturally going to be the free spirit, the one that I do think has the capacity to handle some of maybe the money stress a little bit more. It's just whatever it is, right? Where there's the one that's like, "We gotta get out of this." The urgency is so big. And I mean, I wouldn't put nerd-free spirit on those specifically, but that tends to be the personality of the couples we see. But what we find overall are the couples who win financially, and I mean win, like pay off their home, have $1 million in their retirement, all of it, they are not only shooting for the same goal, but they're for each other in the process. Meaning, if I see that this is so important to him, I know it's important and I wanna get there, but man, he wants to like, you know, go all out.

Okay, for a year, like, we'll do it. I can give up a vacation for a year and I can go in, and almost in a way of loving him, well of what he is desiring and wanting at the speed, you know, that vice versa to the wife, right? If she wants their debt-free, she's like, yeah, she's probably gonna spend more on a vacation. And he's like, okay, we have the money for it. We're not being irresponsible, but I wouldn't, I would spend it somewhere else. But for her right now, okay, let's just do it. 'Cause we can. Does that make sense?

Like—

That is my exact house. I, if I owe somebody money, I don't sleep. Sleep. I, I have anxiety. Like, it drives me crazy. My wife could have a mortgage and a car payment and she wouldn't lose sleep over it. She didn't like it, but she would sleep just fine, right?

Right.

I have a plan and whatever. Her loving me well, when we were buying a house and we were able to put a big chunk down, we're gonna take a mortgage on a little bit of it. We sat down and I said, okay, for this long, it's going to cost Hey, can we pay this thing like this? And she said, yes. And when this thing's paid off, we're gonna take a silly vacation. And I was like, I would never spend that on a vacation. All in. Right?

Yes.

And so it's us loving each other well.

Yep. Yep.

But Andy, what that required though was that conversation that me and my wife had was not a spreadsheet conversation. It was, hey, here's what this does to me. And she's like, I love you more than any other thing I could have.

Yes.

I'm all in. And life without a vacation for me, I like, I, I don't like that. And I'm like, I love you more than any of the, like, right? So we'll do that too. This is about talking about the thing beneath the thing, which is sitting down and saying, here's what the debt is doing to me. It's making me feel like a failure as a dad, as a husband. It scares me about our future. The economy's bananas right now. AI is going He's gonna kill us all. Like all those, say those things out loud and then come up with a plan together. I don't think you're taking the baby steps too seriously, Andy, but I do think you're taking them on all by yourself and that's gonna divide your marriage up. And so I think sitting down and having the conversation, the thing beneath the thing. Yes. And if you're with a partner that's like, I don't care what you care about, we're having a vacation. Your marriage has bigger issues. That's right. 'Cause I promise you that's not just showing up there.

Yes.

It's showing up in other places too.

Well, and that's it too. I'm like, and we say it all the time, that so many calls we get about money issues, they're not really money issues, it's marriage issues. You really do. It is because that's who we are as people to our core, right? Our soulful, spiritual people. Like, that's what the complete side of us is. And all this other stuff of life that we've built on top of it, money, you know, all this other stuff, it's all built on top of that. And the problem is you only get to that layer if you're like, "Here's the spreadsheets and here's how much we could make." make with the percentage that we're saving here versus the market. And all that's fine. Like, that's true, right? Like, you can look at the math and absolutely, and some people are like, great, check it off. That's what I needed to see. But for most people, especially from the quality of a marriage perspective, it is getting to understanding what is happening with my spouse. And when you do, and you have those conversations, you get to know your spouse on a deeper way, right?

01:21:13

And there's nothing greater than seeing and knowing doing and learning about your spouse. By the way, you're gonna be married to 15 or 20 different versions of your spouse over the course of your marriage. So, you're always gonna be in an act of getting to know and then celebrating the crap out of 'em. And celebrating your spouse sometimes is, we're gonna do without a vacation for 2 years, 'cause we're gonna get this thing cleaned up. And then we're gonna be able to go on whatever stupid vacations we wanna go on from now until forever, if we just make the sacrifice. I really wanna stay focused on becoming debt-free. Andy writes, tell her why. Tell her what's going on in your spirit, in the middle of your chest. Have that conversation.

And also, this isn't spouses entertaining or having to puff up a spouse on some crazy thing, right? Getting out of debt, which I guess some people would say is crazy. There are things in life that are like, yeah, that's worth fighting for. 'Cause that really does cause stress, right? You could put money stuff in there, health stuff.

Of course.

You know, it's not like, oh gosh, I think, think, which I can go conspiracy, but if you're like, "Okay, all the cell phones are going down tomorrow. We gotta like get bug out bag," right? Like, it's not like not factual, right? These are things that are like actually factually affecting people. Does that make sense? Like, you can put other elements, but money is one of those things that affects people. So, I'm saying, Andy, you're not being crazy or like out of this world, like, "Oh my gosh, she's having to like coddle something that's bizarre and weird and like, oh gosh." It's actually gonna create a lot of health in you and in your marriage when money is not a factor because you guys have control over it. All right, let's hope the cell phones don't go down tomorrow, but if they do, we have Julie in Los Angeles. I don't know what you'd do in Los Angeles if all the cell phones went down, but hey, Julie, how are ya?

I'm good.

Good, how can we help you today?

Hi. I have a question. First off, I am a debt snowball graduate, my husband and I, from a long time ago, but I am now I'm a widow and I'm 61. I'm looking to retire at 62, which is about a year away. And I want to know, I'm going to move out of this taxable state into a non-tax state, and I want to know based on what assets that I have, how much house can I afford and how should I buy it? You know, mortgage, cash, what should I do?

Okay, how much will you have when you sell the house?

Uh, I'm— I don't own one right now. I'm I'm gonna retire and then I'm gonna move. I want to know how much house I can afford to buy.

Okay, how much, how much money do you have saved in retirement?

Uh, I have about $3 million in investments.

Okay.

Um, and another million probably in 401(k).

Okay, perfect. Do you know how much, um, just living expenses for you is a month? How much you would probably spend? To live comfortably for you?

Right now, working and everything, I'm relatively frugal. Like I said, I'm a graduate from the Debt Snowball School.

Yeah, you're done. That's great. And so what I would do, Julie, honestly, is I would sit down with a SmartVestor Pro. If you go to ramseysolutions.com, you can find one in your area, because I would want you to map out and see, okay, if I had to live off of of the $4 million, how much less could I live off of in order to own a home right out, right? So if you took half a million and bought something with that, you know, you'd have $3.5 million left. How much per year would you need to see growth for you to live off of, which I think would be plenty.

Plenty.

So then you could up it and say, what if I bought a million dollars? Do I need a million dollars? So you're gonna actually be able to run some numbers out in calculations to see actually the money that you have to withdraw to live off of, how much would you need, and if you want to leave any to the next generation as well. So, so I would get with a SmartVestor Pro and run those numbers, but I would assume anywhere from a $400,000 to a $500,000.

Easy peasy.

You're gonna be great, and you can pay cash for it, which is awesome, Julie. Well done. Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. I am Rachel Cruz hosting this hour with Dr. John Delony, and we're taking your calls. The lines are open at 888-825-5225. 5. All right, we're gonna go to John in Houston, Texas.

H-Town! What's up, John?

Hey, what's going on, y'all?

Hi, we're doing great. How can we help today?

So I am wanting for me and my wife's household income to equal $100,000 a year by the end of 2027. I'm currently halfway there and make $51,000, but she refuses to work, and when she does work and then quits. She blames it on being bipolar and having anxiety. I'm wondering what I should do to push her to start working and keeping her job.

Does she have diagnosed bipolar disorder?

She does.

Okay. Is she— manage it well? Does she take her meds?

Uh, she takes her meds, but as far as managing, uh, it's probably not. Hmm.

What does that mean? Sorry, what would that mean? She's not managing it well, but she is.

I've known some amazing, some folks with bipolar I that are amazing folks, but they know, "I have to take my medication every day for the rest of my life." And for folks with, especially with bipolar I, it's hard because you feel so good. It's easy to feel like, "Oh, I'm all good now." And you gotta take your meds, but also, you have to be intentional about your exercise. You have to be intentional about your sleep. You have to be intentional about relationships. The whole thing. And that's what I mean by managing it. Managing it.

Got it, got it.

Um, and so she doesn't do that, is that right?

No.

Okay. Is she still seeing a, a counselor?

Yeah, she— we actually have a schedule for Thursday.

Okay. Um, I— is this your first time to go with her?

Uh, this is— this will be my second time.

Okay. I want you to lead with this question, okay?

Um, okay.

We have some household financial needs needs, and I see needs, I see, uh, abilities in my wife that she doesn't see for herself. How can I love her through the transition of being scared of your own body? Which having bipolar 1 is, as they've ex— I've had people explain it to me, it's like you're being betrayed by your own body, right? Some things feel so amazing at them, some things feel like the end of time, and neither of those things are right. And so how can I love her through this position.

Yeah.

And that's going to signal to your wife, I'm on your team and things have to change in our home. And it's going to signal to the therapist, oh, this woman has support, not at the lecturing level but at the soul level. I'm with her. How can I love her well during this time as she's going to begin managing this thing?

Yeah.

All right. And then if she's in a, in a positive season right now, if she's in like what I call, uh, not a manic state or a depressive state, but if she's doing pretty well right now, this is a great conversation to lay out. Like, how can I love you when things get pretty— when you get pretty ramped up? And how can I love you when things— when you get pretty ramped down? And go ahead and come up with a game plan now so that when those— when those things hit, um, hopefully the, the medication and the life management, all that, level some of that out. But when those things hit, you already have a roadmap. Trying to ask somebody during a manic phase, how can I love you? That's not helpful, right? You've been there, right? And when somebody can't get outta bed, like it's hard to be like, "Well, how can I love you today?" And so, but getting that when you're in a good season, that's amazing. And it might be, it might be that the $100,000 number you have in your head, y'all may never get there. It might be $75,000 and that'll be okay.

We have to then reimagine what our life's gonna look like. And that's gonna be okay too.

Yeah, I put the $100,000 mark because we're actually $30,000 in debt.

Okay, and that's hard to pay off only making $51,000, right?

Right.

Yeah. Does she have her spending under control?

Um, no.

Okay, that might be the front end of this conversation, which is during manic phases especially. We— I hear that a lot, that folks just get to spending and spending and spending. So So when I know I'm heading into a manic phase, I'm going to put my debit card in a lockbox and you own the, uh, we have a freeze on your credit report and you own the passcode to Amazon Prime, right? There's just some low-level basic things that I've seen couples do that work great for the, for those seasons. And you might have to weather a storm, right? She might come after you for that code or that password, but we're gonna hold firm in those seasons.

Okay.

How long have you guys been married, John?

Uh, we're going on 3 years.

Okay, 3 years. So still learning. Yeah, how to do this well. I'm glad you guys have a good, a good counselor.

And can I say this, um, this doesn't get talked about very much. This is exhausting for you too, right? It's okay for you to feel that way. Also. Okay, I know she's the one with the diagnosis. I know she's the one struggling inside of her own skin. Totally get that. And you love her to the moon and back, right? And it's frustrating for you too to try to build some sort of secure life for both of you. That's hard. And so you get to be— um, I want to give you permission to be frustrated too.

Okay, John, did you— were you aware of everything before you guys got married?

Um, so actually I had a couple— I had one debt of my own, and then when we got married, we, uh, financed a car. And then the rest is, um, just if anything were to happen, if anything happened, she would just panic and then just get a loan for $500 or $1,000.

Okay.

Yeah.

And so that's where putting a freeze on her credit— y'all, you, you don't do that for her, but y'all do that together. That in those moments when she panics, it, it— there's a stopgap there, right? And we're gonna put as many hurdles as possible in front of us so that we together don't make bad decisions for us.

Okay, awesome.

Is that cool? Thanks for the call, brother.

Yeah, thanks.

Thanks for loving her well while she's struggling.

For sure. Yeah. And that, that is difficult. And I think, you know, and even if someone is not, you know, diagnosed with something like that, there is this realization of, okay, I can only do so much on my end. You know, we were talking about spouses and bringing them on board, right? And working as a team together. But we have found when you create stopgaps together with things like spending, when especially if you see a pattern, is so helpful. It is so helpful because you don't realize the ease at which debt can just come into your life or spending can just happen.

01:32:41

You can have a bad, I've known people with bipolar 1 that have one bad weekend and they're, I'm talking 10 or 20 years worth of digging himself out of this hole.

Yeah.

Right.

You can go buy a car and get a $10,000 loan and then get 2 credit cards and burn through 'em all in a weekend now.

Right. Right.

And what a nightmare that is to untangle. Totally. So it's knowing yourself well enough to know and being honest with yourself enough No, my body gets set on fire from the inside out. I panic. I do X, Y, and Z. I need to put some hurdles in my life. Will you help me?

And from your experience, not her specifically, but that situation, she could have the ability to have that rational thought when she's in a good state. Totally.

Absolutely, yeah. Yeah. And he's gotta expect she's gonna come for blood when she's not doing well. And that's part of loving somebody well when they're struggling, right?

Yes, with that.

And that's okay. That's part of it.

It's part of it.

Well, John, we're so glad you called in. I hope that's helpful. We're cheering you guys on. Call us back if you need anything.

¡Hey, guys!

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

Up next, we have Tori in Huntsville, Alabama. Hi, Tori. Welcome to the show.

Hi, thank you.

Yes, absolutely. Thanks for calling in. How can we help?

So I am currently in Baby Step 2. I currently work for a financial firm, and what I do is I deal with equity. And although I'm currently paying off my debt, there is a test, more so like the certifications for equity professionals that you can take. I mean, it— for me, it would significantly increase my income. Okay. But it is $2,000, so Okay. My question for you is, although I'm still paying off debt, would it be okay to, you know, spend that money to take this test and, you know, more than likely increase the income, or should I just wait and try to finish off paying? Because right now, if I stick to my plan, I should be done and completely out of debt next year.

Okay. Um, Tori, what are you making now? And if you had the certification, what would you be making?

Making?

Okay, so I am currently at $68,000. Okay. But minimum on average about $90,000 with the certification.

Oh yeah, I would.

I would, Tori.

I would, Tori. Yes, because it's pretty guaranteed, right? It's not like you're getting an MBA and you hope you'll get a higher paying job somewhere. It's a pretty like one for one, right?

If I didn't get the $90,000, majority of even just even competitors with my own company are paying at the very minimum for an E, like, for the actual, the Certified Equity Professional certification.

Yep.

Still at 85 minimum for most companies. That's the lowest I've seen it.

100%. Yes. And are you pretty confident that I'm confident you can take that? You'll take that when you take it, you think you'll pass? You gotta pass, or you have to take it like 5 times? Do you know?

No, I think I'll pass. I've been actually preparing for it. I've been thinking about it for the past year and a half. Oh my God.

Heck yeah. I'm like, that's like a $20,000 increase.

How many months will it take you to save up to pay for this test?

Um, honestly, I just recently picked up a second job, so I honestly can have this saved up within the next 2 months.

You're a baller. Do it, do it.

Um, yeah, also because I just paid off my car, so then that freed up an extra $500 a month. So I'm confident I can have I have this done.

Yeah, do it, do it.

Yeah.

And I don't know, I know like I've heard on you guys' show where like you said, like when you're paying off debt to like stop certain things. So like I did stop part of my 401k investments. I, um, I didn't drop it all the way down. I had it at 10%. I'm now doing 6% just so that I can keep my match.

Boo!

Tori, for 12 months, pause it and throw that money at your debt.

Just be done.

You're so close.

Yes.

Just for 12 months. I know.

I have $22,000 left in student loans and then I have about $4,200 left in credit cards. But I got a plan.

You got it.

One card is almost done. I'll have it paid next, next, like literally in the next month. The next card was a secured card. So actually I plan to close it anyway. Good. So I can throw that at the next debt.

Good. Yes. It's the snowball effect.

You're doing it.

You're doing it.

Tori, we're so, I'm so proud of you. Girl, that's amazing. You're doing incredible. You're doing absolutely incredible. And the research of figuring out, okay, I can get a $2,000 certification for a $20,000 raise. That's some good ROI right there, Tori. Like, yes.

And everybody listening, here's what we're not saying. What you said, this isn't, I'm gonna pause the Baby Steps. I owe $100 grand from undergrad. I'm gonna go ahead and take out a $200,000 loan to get an MBA. And I hope that that moves me up. I'm a teacher and I wanna go back to school, get a master's degree, and I hope this other district hired me. This is somebody in a job.

Yes.

Who has a, needs a credential to move up in this job. She's already crushing it in her company and it's just, and it's $2,000. It's $2,000. Yeah.

Yes. This is a no-brainer.

Yeah.

So Tori, you're awesome.

Oh, get it.

I love it.

Love it.

All right, let's go to San Diego and we have Chris on the line. Hi Chris, welcome to the show.

Hello, it's a pleasure to talk to you guys.

Yes. Well, thanks for calling in. How can we help?

How can we help?

Yeah, so my wife and I got married 6 months ago and we've been living in an apartment in San Diego and her in-law, or my in-laws, her parents are offering to build an extension onto their home so that we can move in and save money, but we would be paying for the construction of the extension to their home.

Oh, that's great.

Hey Chris, I got a good idea. Give me a million $1 million to increase my home. Yeah, to increase my home value, and then, uh, I'll let you— I'll let you live there. Yeah, no, I would not do this.

No, no.

Um, but it's interesting though, because like financially we could do it.

I know it's not interesting though, because you'll be living in your— in your in-law's house.

Yes. And then actually, for resale value, in-law suites are actually not that great, because it takes a very specific buyer to even want it. So even for your in-laws, if your in-laws called and said, we want to build our on, I would be like, "Eh, I probably wouldn't. I think they're fine." No, Chris, you guys need to go and live your lives, genuinely. Because what happens, people get trapped in these situations, and then you take out the construction loan or whatever it is, and you're trying to pay it, and then something happens and you wanna move to Arizona because you got this insane job, and it's like, "We can't 'cause we're stuck here because we promised this and this." Like, you start to have all these strings attached and you guys Why can't you just fly and be free? Like just, yes. And have a driveway that's just yours, not parking with your in-laws. You know what I mean?

If they said, hey, we're gonna do this anyway and we will let y'all live here rent-free.

For a year or two or whatever. I'd be all about that.

Do that all day long. But y'all.

You need to build your own equity too.

Yeah.

In your own place.

Rachel's call-out is really important. The first, you're gonna put down $350,000 on this thing, you're gonna cash flow it, and then you're gonna get the job of a lifetime in Texas. And you're going to be like, wow, there's no state income tax, what do we do? And you're gonna have to take this, and then that money is sunk into your in-law's house. And I, I just wouldn't do it. I wouldn't do it.

Okay, did we, did we convince you? What do you think? Do you want to go— do you want to live at your in-laws?

Um, you know, I have my own thoughts.

What are your thoughts? You've heard ours.

What's It's further in San Diego from my job, and in terms of dollars, more dollars would be going out per month even though it's the same amount, if that makes sense.

Wait, say it again. Say that.

So we're—

the amount that we're able to save right now is how much we'd be putting towards the loan, but it ties up our money. And if we're ready to move out in our own place in 5 years— oh yeah, I think it would— it could tie us down even more.

Yes, correct.

Saving the same amount in the same amount time and having that money as liquid.

Correct.

Yes, you are thinking 100%.

What's your— what's your wife saying?

I guarantee you I know what she says.

Um, we haven't had a ton of time to talk about it recently, but, um, I think we're kind of on the same page. I've been sharing my thoughts with her and she's like, yeah, like, that totally makes sense. And then we're bouncing it off her parents and kind of having a mutual discussion, but it's all very loose right now.

Okay, I want to say crazy. Don't have a mutual discussion with her parents. You and your wife have a discussion and then you announce what your decision is.

Wow.

Because I don't want them negotiating with you on y'all helping increase the, the resale value of their home. Y'all make a decision and then you say, hey, thank you so, so much for the offer. Um, we're going to keep— we want to stay here in our apartment and we're going to build, uh, up our savings so that we can get our own place. End of conversation's over.

Yeah, that makes it nice and easy.

Now they, they probably have a— oh, go ahead.

I was going to say their hearts may be in a great spot. They— I think in some situations like this, they genuinely think, of course, we're helping and this will be so great.

One day we'll flip, we'll move to the— we'll move to the in-law suite and we'll give the house to them. I, I, I mean, I'm telling you, that's what I bet they're thinking, that they can get the house and we'll downsize later or something. Or no, we'll move to the in-law suite and they'll keep the house, and then we can be around the grandkids. They've got a whole idea worked out, and it's— I, I don't fault him for a second for coming up with this idea. It's a great plan. And housing in San Diego's— I don't know, one-bedroom apartments, $8 billion. I get it, right? I totally get it.

And to your point, if they had built it and it was there— like, we had some friends and their parents had like a small home out like by a pool, and they lived there for about 2 to 3 years, rent-free, everything, and it was great. And then they saved up the money, they went and put a down down payment, moved into a home. It was wonderful because it was already there. It was part of the system. They had a good relationship. It was fine. And they actually created their savings goals. But Chris, if you're having to cash flow this into something that you can't take the equity out, that's not a smart investment. And I just think having some boundaries, your first 6 months of marriage, first couple years, I think it's good. Have your own location. You guys figure out life together. But thanks for the call. And yeah, Yeah, congratulations on the new marriage.

You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage. To protect your biggest assets, I recommend using Ramsey Trusted Pros. Whether you're looking for car, home, or any other type of insurance, Ramsey trusted providers have been coached and vetted to serve you like we would. Find what you need at ramseysolutions.com/insurance.

Buying or selling your home is a really big deal, and there's so much clickbait in the headlines out there and conflicting data that it's hard to know what's really happening in the housing market. And so we're here to make the latest trends easy to understand. So last month, the average 15-year fixed-rate mortgage had ticked up a bit to to 5.56%, but it's still lower than 6%, which is great. And if you're financially ready, a small increase like that shouldn't be able to hold you back. So again, this idea that just because prices, interest rates go up a little, down a little, all of it, if you are in a position to buy a home, you need to get into the market. Now, the median home prices went up to $415,000 last month, which is typical for the spring markets. Now there's more homes available or more Buyers are entering the market, so it is a great time to buy or sell. So to learn more about the housing market trends and to get free tools to help you buy or sell with confidence, go to ramsaysolutions.com/market or click the link in the show notes if you're listening on podcast or YouTube.

All right, let's head to Riley in Memphis, Texas. Hi Riley, welcome to the show.

Hey, how are you guys?

Hi, we're doing great.

How can we Okay, so I'm gonna keep this brief. Me and my husband, we've been Ramsey people since getting married and have no debt aside from our house. However, my parents have been struggling financially for quite some time, and despite this, my mom will buy things for us, and it takes a huge toll on my husband and I. It makes us feel like we're contributing to their debt. So I was just wondering, how do I approach my mom about purchasing things for my family when they are in debt and can't afford it?

Yeah, what's she buying?

Buying? So, um, she'll buy stuff for our house. We're not— we just moved into our house and we're not in a position to buy like things like curtains or rugs or things like that. And so she'll buy stuff, um, like that. Or we just had a daughter as well, and so she'll buy, um, like clothes and things for her.

And you're not asking her to? She's just showing up with stuff?

Yeah.

Yeah.

So here's a hard truth, um, you and your husband can't own her decision Yeah, okay. You can, you can, you can sit down with her and say, Mom, me and my husband really want to grind this thing out ourselves, and I'm so grateful for you always bringing us stuff and all that kind of— like, what we really want is you just to come hang out with the new baby or come hang out with us. Um, but really, and I know this sounds ridiculous, we want to grind it out ourselves.

Yeah, yeah, you can't— that's what was—

you can't do anything about it. I guess if she shows up with it, she shows up with it, right?

Yeah, yeah. I guess that's what I was wondering, like, if it's something I need to change my mindset about, like it's not my problem kind of thing, as bad as that sounds. But it does make us feel really guilty knowing the place that they're at, especially because we're doing a little bit better than they are.

Yeah, I want to set you free from this, um, and it's not a one and done, but my friend Becky Kennedy, she's a psychologist in New York. She taught me this and it, it, it's one of those, I had a before and after moment and this is just a year or two ago. Okay. Do you think having, um, curtains in your house, is that a violation of you and your husband's marital values?

No.

No. Do you think getting a gift, is that a violation of your marital values?

Values?

No.

Okay, so guilt is actually a good thing. It's a thing that our body feels when we do something that violates our core values. What you're feeling is not guilt. You're trying to take your mom's situation and own it for her. Okay, you get what I'm saying? And that's not your cinder block to carry around all the time. Probably underneath the thing you think is guilt, I bet it's anger. Yeah, I bet you're pissed off that they've— you grew up in that house, you know how— what money stress feels like, and she's now doing it to y'all.

Yeah, right.

And so it's, it's, it's what you're feeling. I don't think is guilt. I think you're, you're mad. I think you're frustrated, like, get your house in order, Mom and Dad, right?

Yeah. And I think a lot of that comes from— we actually, a few months ago, we were doing really, really well financially, um, when my parents were at their worst, and we gave them a gift, um, a money gift, in hopes that it would be kind of a wake-up call.

Um, no, you woke up— you woke a dragon. That's what you woke up.

And so I feel like it's kind of a slap in the face. So I do think that's— that's kind of makes me and my husband a little bit angry.

Did they ask for that money gift?

No, it was just something that was put on our heart.

But tell me about that.

01:50:39

So, at this point, this was during Christmas, and at this point they were really struggling to put food on the table and trying to give us a good Christmas, me and my siblings. And so, we just felt really saddened by the situation. My mom had just gotten laid off from her job, and so we felt that possibly giving a gift of money and then realizing the help that they can— that they have received would help them, I don't know, like feel more motivated, um, to get back in the workplace, um, to provide for their family.

Mm-hmm.

Um, so one, and it didn't work out that way.

Yeah. So one time, um, like if, if somebody passes away, you bring food, right? Like there's some things you just show up and you, you, you, you just show up without asking. One time my buddy and his wife were, he was finishing school. She was, they were, they were just stressed to, to the max. And then she found out she was pregnant. Pregnant. And so I told my wife, hey, I want to get them a house cleaner. I want a whole crew to show up at her house and take care of the whole thing. And my wife looked at me and she's like, are you insane? And I said, what do you mean? And she said, the last thing a woman who's drowning in all the stuff needs is her friends to think, oh, she's got a dirty house, let's clean it for her. And so what she told me was, sit down with them, they're your friends for 25 years, and say, hey, how can we love y'all right now? We're in a season of blessing. And so instead of throwing a check at somebody that's struggling— there's somebody you know really well, right?

If this was a person who was struggling, they didn't have a house, somebody that you're just—

someone bad with money and you're giving them more money.

Sit down with your mom and say, hey, I know y'all going through a tough time. What do y'all need? How can we love y'all right now? And let her tell you. And if she has too much ego or pride to say, hey, we could really use $500 for groceries, um, and she says nothing, we're fine and "good," then let her be an adult and say, "You're fine or good." But you thinking y'all can go in and just dump money on a problem and it's gonna motivate 'em, that's never worked for them ever, and it's not gonna work now. And y'all are the ones paying the price for it, right? You're upset about it.

01:52:47

And now you're resentful because they're not doing well with their money, right? The thing that was supposed to help them. And in fact, they're becoming still irresponsible, and you're in the pathway of it all, of them just like throwing their irresponsibility at you with stuff that you're like, "Mom." Yeah.

And I, I don't want you walking around feeling guilty because y'all are in a season of blessing right now.

Yeah. So what's the, yeah, what's the boundary, Jon, for adult, an adult child, right?

Yeah.

Riley and the parents, like, take, take care of your money really well.

You and your husband be good stewards of what you got. And keep an open dialog with your mom. That question always, how can I love you today? I ask my wife that, she asks me that. But that's a great question for your kids. It's also a great question for your aging parents.

Parents. Yeah.

And if they say, well, we just need $1,000 a month from here on out, then you can say, I don't want to contribute to that, or I'll walk you through your finances if you want to talk money, but I'm not just going to throw money at a problem over and over because then you are tilling the soil for resentment, right?

Right.

Yeah.

And so own that. Say, I want to love you. I want to— I want our relationship to stay good, and just throwing money at a problem, right? So, if you wanna talk about how to get your money right, if you wanna talk about budgeting, if you wanna talk about this Ramsey stuff that me and my husband do that has helped us get this clear, I'm in all day long. And if you have a need, like, "Hey, we don't have any groceries," we'll be there for you 100 times out of 100.

Yeah, we can feel that need.

But man, when you get to just—

Well, when money's just thrown at a problem, anything, this could be friendships, parents to children, children to parents, I mean, all of it. When it's being thrown at a problem, but the problem itself is not being addressed, it just magnifies the dysfunction and it becomes a bigger of the problem, right? It rarely goes in and fixes it. Now, if someone is in a season of cleaning up their, you know, clean up their financial mess, they're working the Baby Steps, they're taking an extra job, all of it, and you have some money and you're like, "You know what? I feel called to be like, hey, let's pay off that credit card for them." Like, we wanna do that. And 'cause we are magnifying the good that is happening, not the dysfunction.

01:54:52

But I will say this, I'll say this, sometimes that sentiment, which I agree with 100%.

Yeah.

Is used to also, hey, there's a guy hungry on the side of the street. I'm not gonna give him any money. He needs to get it. Sometimes the problem to solve is that guy's hungry right now.

Yes.

He needs a place to stay tonight.

Totally.

Right, we're gonna solve that. Like, so I wanna be generous across the board.

Yes.

But when it comes to systemic stuff like this in your house, man, sitting down and having the harder conversation is always more valuable.

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Our scripture today comes from Isaiah 43:19, "See, I am doing a new thing. Now it springs up, do you not perceive it? I am making a way in the wilderness and streams in the wasteland." Jim Collins said, "The critical question is not whether you have luck, but what you do with the luck that you get." Ah, do you remember, Jon, this is so random, one time we were hosting together, every time I do it, I kind of laugh to myself, 'cause I have this memory of us hosting together, and I didn't say our scripture of the day, I just started saying, "See, I am doing it." I just started right into the scripture.

We were just hanging out on the air and Rachel starts speaking in like New King James, Old King James Version. And I was like, "Uh." He said, "What are you saying?" I was like, "It's our Scripture of the Day." She's been reading all those like fairy Viking romances or whatever. And she started like speaking in that language.

Anyways, it just always makes me laugh. I'm always like, "I need to say Scripture of the Day." And I don't just start saying, "See, I am doing a new thing." No. Hands up.

Although when we're hanging out, just like you and me and Sheila and Winston, you do just sometimes break into these long scriptural monologs. No. Yeah.

All right, let's go to Columbus, Ohio, and we have Alexa. What a name to have in the world today. Hi Alexa, welcome to the show.

Hi, good afternoon. Thanks so much for taking my call.

Yes, absolutely. Thanks for calling. How can we help?

Yeah, my husband and I exciting, about 2 to 3 months away from completing Baby Step 2. Yeah, realized that we are not aligned on what to do with our credit cards once they are paid off. Okay, and I'm in the camp of closing them. He is not, and so I'm just looking for talking points on how to help him make, make him feel good about that decision.

Some talking points. Okay, so when you say he doesn't want to close it out, does he want to keep keep it, the credit card, in case of an emergency, or is he wanting to keep it for expenses but pay it off every month? Like, what is he looking for when it comes to the credit card?

He's in the camp of, it's a good credit-building tool, and then more so in case of an emergency, why not, is what he usually uses.

Yes. Okay. Well, my talking points, which Jon could probably get into the psychology of just what you're desiring, Alexa, and for, as husband and wife, you know, how you can approach that with him on more the emotional level. But from just the financial side, you know, what we find is people who especially rack up credit card debt throughout the month and say, "We're gonna pay it off," more, I think it's like right close to 50% of Americans don't. And so, half the people are telling themselves a lie that they can afford it when they really can't. And if your credit card is your emergency fund, then you're just, you are adding risk back into your life. And what I think it does is I think it slows down the motivation to actually save and have a fully funded emergency fund that should be your safety net. You should be your safety net, not, you know, a credit card company. And then when it goes to building your credit score, I mean, yeah, if he's wanting to go go, you know, get loans, then yeah, you will have to have a credit score. But if you wanna live a life debt-free, which you guys have done and you've worked so diligently to get out of debt, why you would wanna go get a car loan again or a personal loan, I don't know why you would.

But if you did, then having a credit score would be important. But we believe you don't have to live with debt, so you don't have to have a credit score. And for a mortgage, that's the one type of debt we're okay with that you can actually do manual underwriting. You don't even have have a credit score to do that. So, there's a way to live life without a credit score, but you really are choosing to live life debt-free, which ultimately, which is why we do this show, we really do believe it brings the ultimate peace when you don't owe anyone anything and you have autonomy over your money. So.

Can I give you a bad, like an example that's probably not fair, Alexa?

Okay.

How long have y'all been married?

Married? 2 weeks.

Oh, 2 sweet, y'all are just in this. How long did y'all date?

We've been together for about 8 years.

Okay, gross. That's a decade. Awesome. Okay, imagine— I'm gonna be ridiculous. Will you be ridiculous with me?

Sure.

Okay, imagine y'all both cheated on each other at the beginning of your dating relationship, and then y'all both decided it's you and me, ride or die, we're gonna do this thing. And then y'all were both like, but But let's keep those one-night stands numbers in our phone just in case you get annoying.

Oh my gosh.

Right?

Yes.

It's ridiculous, right? It's ridiculous. You would never do that.

Yeah.

You would say, no, no, no, we're married. We're gonna figure this thing out. And so if we have a fight, if we don't like each other for a while, which is every marriage, if we're annoying each other, we're gonna sit down and figure this out. If you work like crazy to get outta debt and you're like, well, let's just keep these things open just in case, you're going to use 'em. If you don't have that number in your phone, you're gonna have to sit down and figure out, all right, we had the fridge go out and the transmission fell outta the car. We're gonna have to figure this out. What are we gonna do? And we're gonna buy a $50 used fridge on Craigslist just to put milk and eggs in to get us through.

And we're gonna be a one-car family for a month.

Yes.

Right.

And until we save up and pay for it.

Yeah. You, you will figure out how to do it. Right. And so I, for me, I'll tell tell you this, uh, it's why I keep social media on a separate phone. I'm not good enough. Those, the tech folks who created these social media, they're better than me. They are better than me. So I have to put a bunch of steps in front of me. It's a tool I have to use for work, so it has to go on a separate phone with an off switch that goes in my bag, et cetera, et cetera. When it comes to credit cards, I'm not good enough. I'm not. They're better than me. Always knowing I could always just quickly jump to this thing. Um, so I, that's why I think you, close them, you close— you set up a bunch of hurdles between you and where you actually want to go.

Love it. I appreciate it. Thank you.

Yeah, you bet. And congratulations, 2 weeks in. I'm glad you already have it, having this big fight.

Good luck. All right, let's go to John in Denver. Hi, John.

Hi, uh, had a question on your guys' thoughts on public loan forgiveness. My girlfriend is graduating medical school and is starting her residency, and the 3 years of her residency will count towards the 10 years needed for Public Loan Forgiveness. So didn't know if that's something from a "we should pursue" standpoint, or if it's more so, hey, we can aggressively pay this off once she gets her her first kind of normal paying doctor job. Yeah. Or what your guys' stances were on public loan forgiveness.

So I'll tell you this, I have, I have a really significant built-in bias and I'll give you the other side of my bias. I worked at a law school for 6, 7 years. I'm for a while. And I had a number of some of the most brilliant compassionate minds forego go working in big law where they could go make a whole bunch of money, and they chose to go do public service law with the idea that they were going to be a part of this loan forgiveness program. And then they all got hosed. They, they weren't— they weren't like— they kept getting denied or not reimbursed or delayed or an administrative error or clerical error or some sort of mess. And so I have been ranting. I I don't trust the government to come in and pay off any, I don't trust them to do anything they say they're gonna do in 10 years. I, I mean, go back 10 years politically. Could you have imagined today? No. Right. And so when I look into the future 10 years, I would say, man, I trust me and my wife more than anybody else in the world.

That said, I want to also give the other side is the Public Service Loan Forgiveness has gone up. They have been processing more and they've been getting through this backlog of millions of people. I would continue to pay on it if it was my house, just cuz I don't trust what's gonna happen in 10 years. Um, but that, that, that I'm telling you what I would do in my home. I'm telling you what I did do in my home. My wife and I paid off our, our student loans of our doctoral programs, um, that could have qualified for public service because we didn't trust the outcome.

Right. Which, and my only thought is, And then this is my nervousness, I guess, or compare and contrast whether you put money in the market, et cetera, is that she has over, it'll be over about $600,000. We don't have any consumer debt really. The only thing we have is—

Well, it's not we, John, it's your girlfriend. So keep things separate.

Yeah. Right, correct. Yeah. Which, and the plan is trending in a good direction.

I'm glad. I'm glad. Yes.

That's— yeah. Uh, no, I won't spoil anything, but that's where, uh, they're heading.

Yeah.

Yeah. I mean, again, we— yeah, we've heard the good side, bad side. We tend to lean on—

I'm going to lean every time—

personal responsibility, pay off your debts, take care of it. Um, but we do know people— we've had people call in on the show and they've chosen to give their life that way, and, and it worked out for them, and that's great.

Um, 600 $200,000, it feels like an insane gamble to take on the government going to do what they say they're going to do in 10 years.

Yep. All right, John, thanks for the call. Uh, great show, everyone. John, thanks so much. And remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.