Transcript of Managing Money Well Matters At Every Income Level

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Start budgeting for free today. Normal is broken. 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. The phone number to jump in, 888-825-5225-888-825. 255-225. Alongside the lovely Rachel Cruz, I'm Ken Coleman. We're excited to be here to help you today. We started off with Lucas in Austin, Texas. Lucas, how can we help?

Hey, I I am calling in because I was looking for a way to manage my finances better. I'm 28 years old. I'm single. I have some credit card debt as well as some student loan debt.

Okay. Okay, so just an overall direction is what you're looking for from us? Yeah, pretty much. Okay, yeah. So how much debt does all that total?

So it's probably closer to, I don't know, 30 I think it's $30,000.

$30,000? Okay. How much of that is credit card, and how much is that student loan?

So it's 14,500 in credit card, and student loan is about $20,000.

$20, okay. Cool. And how much do you make a year?

I make about $32,000 a year or like, 16 an hour.

Okay. What do you do?

I work in mobile device repair and sales.

Okay. For like a cell phone company type thing in a store? Yeah, basically. Perfect. Okay, great. Well, yeah, I'd love for Ken to jump in on just the career side because I think you still have so much ahead of you. Where do you want to be?

Well, right now, I'm in an in-between spot because I like what I do, and I like working with physical technology and things like that, but then trying to transition to something a little bit more viable for the future is what I'm looking into. What? Probably trying to get into more like data processing and things like that.

Okay. So have you done enough research to know what that could look look like as far as position A, position B, position C?

Not yet. I'm still in the phase of trying to figure out which direction to go with it. I've been looking into more data science and things like that. That's where I'm at in trying to transition my career path over there. Okay.

Well, real quick, and then we'll get back to Rachel here and walk you through what you need to do. But you do need to increase your income. I'm We're saying that separate of us trying to figure out which long-term direction that you're going to go. While you are in the process of discovery, and I'm going to help you with that in just a moment, you still need to be making more money. Because right now at 28 and single with the debt you have, the one thing you have is time, and you need to make time. Whether that's some freelancing in the same space that you're in or doing some freelance in technology. Again, we're not talking about a career choice. We're saying, I need a second job, and I need to make an additional $2,000 to $3,000 a month. That would be the goal that I would give you. What you would do is say, What can I do now that allow me to make an additional $2,000 to $3,000 a month? Because you're at $32,000 a year, I believe is what you said. You need to increase that, and that will allow you to get through the steps that Rachel is going to walk you through.

But here's what I give you, quick advice. I love that you have an idea of the direction you want to go. What I would do is use this idea that I've introduced before called the Proximity Principle, and it's simply this. I want to get around people that are in the space or spaces that I am considering. That's lunch, that's coffees, that's, Hey, will you connect me to somebody over here that you know, and you want to do a good old-fashioned term paper, and you're going to Get with this person and ask enough questions that you could do a term paper on their job. We're talking high school term paper, nothing complex. What you're doing there is you're getting clarity on the role itself, what it takes to win in the role, what it takes to get qualified the role, how I get placed, how I move up. In doing all of that, your head and heart are going to get connected. The head's the information, the heart will be the emotion to say, I'm excited about that. I'm going to do one thing. I'm going to give you at the end of the call, I'm going to give you my book, Find the Work You're Wired to Do.

It has to get clear assessment in it. It's going to take about 20 minutes. It's going to really help you. That's my gift to you, okay?

Okay. I appreciate that.

Yeah, but listen, more money. Now, Rachel, he starts making more money. What does that look like to pay off his debt?

Yeah, because those are your two big parts of the equation, Lucas, is the income side and the expenses side. But you're probably only bringing home, what, three grand a month-ish, would you say?

Yeah, it's closer to about two.

About 2,000 a month. Yeah. So how are you paying? Are you living at home?

So I live with two roommates. I only pay about $600 a month, and I rent two rooms in a house.

Great. Awesome. Okay. Perfect. Good for you. That's great, because The living expenses is usually one of your highest line items in the budget. And so for a lot of people, they're paying a thousand, even 2,000 for mortgages. I mean, it's just like it just can get so high. So that 600 is... Honestly, I mean, that that's a great place to be. Because honestly, Lucas, when you leave your job at five o'clock, I would go work somewhere from 6: 00 to 9: 00, and I would do that four times a week, and I would do one weekend. And seriously, if you can get $2,000 to $3,000, you You could have this all cleaned up in 10 months, which is wild to think you could have all your debt paid off. But you have to have a goal from an income perspective, and that's going to be your biggest bet. Because I don't think there's many expenses you probably can cut that's going to make that big of a difference. You know what I mean? So there is something so encouraging about this that you do have the time, and it's just going to be hard. It's just 10 months of just grinding it out.

But a lot of people do that, Lucas, sometimes for two, three years to get on the the other side of it. But I think that there's a lot of upside. It's just going to be the work is the equation, that part of the equation that's going to be really big. And like Ken said, that may not be career stuff, right? I mean, you may be waiting tables, bartending, whatever it looks like to go and earn some extra money. And then I think for you, Lucas, just from a long-term perspective, be looking at what you want to do long-term and start actually building out a career that you love and you're passionate and you're good at. So you're making more like 60, 70, 80,000 a year down the So that would be my two big goals for you. But if you hold in the line, we'll get you Ken's book, and then we'll also get you every dollar. This is our budgeting app. But it also will look at your entire financial picture and help walk you through how to basically do the baby steps. So you can enter in your information in that app, and it really walks you through.

But when you're looking at your debt to attack it, the debt snowball is what we recommend. And so taking those credit cards is how many credit cards is that? 14,000.

So it's between two credit cards. One credit card is basically... I applied for it when I was younger, and they gave me a 14,000 credit limit. And I was like, I don't need that much. But I ended up living off of it because I was making like, 10 to $12 an hour at one job. And I had to have some extra income because at the time, I was paying for an apartment that was $1,400.

So I just kept putting rent on that card, and eventually, I just maxed it out. It wrecked it.

Okay. And then the other card Yeah. And then the other card was like $500. And yeah, that's where that's at.

Okay. So I would have a goal to get $1,000. Do you have anything saved at all? Any cash?

Not really.

Okay. Yeah. So your first goal would be to get $1,000. We're at the end of February right now. Make it a goal by March 15th to get $1,000. Whatever that looks like. You got to sell stuff, you got to work extra. And then from there, you're going to start saying, Okay, with this $500 credit card, we're going to pay that off. And have an aggressive goal. At the end of March, mid-April, that credit card is gone. And then you're going to start attacking that $14 or the other credit card with the rents, and then start attacking the student loans. So you do it by smallest to largest. But yeah, hang on the line. Christian will pick up and we'll get you all that stuff, Lucas. But excited for you in this new journey you're on.

I love entrepreneurs. Don't forget, guys, I started my company on a card table myself. So I know what it's like to have people counting on you, your team, your family, not to mention your customers. And when you're the one signing the paycheck, you can't afford to fly blind. But I'll be honest, early on, one thing that nearly sunk us was wasting time with spreadsheets that didn't add up because business units didn't talk to each other. I finally told my team, Just fix it.

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Hi. Good afternoon. Thank you for taking my call. Sure. My question to you is, should I move out of my house, which is owned by my mom and her partner? They are not married. They have two mortgages, which is the apartment I live in, which I pay in full for every month is $2,600. They have a home that they live in. Their mortgage is $4,300. They moved out of my apartment eight months ago to move into their home, and now she wants to leave them. And we're trying to figure out what the best move is.

She wants to leave him. Is that what you said?

She wants to leave him, and she wants to either move into my apartment or really, she wants me to move into her house, the one that they're paying for together, have him move into the apartment so no one gets, quote, unquote, burned. But that's going to be a big change in my life, and I'm going to take a lot more expenses.

Let's just pause, okay? I appreciate. We're honored that you called for our opinion. Believe me, we have opinions, and we'll give them to you. But before we get there, let's just go where you are. Where are you at? What was your knee-jerk reaction? What is your feeling right now? What decision do you think is right for you? Tell us.

My ideal situation would be to... I told them when they moved, I'm like, If I'm going to be paying everything, I'm paying everything. I'm paying the property tax, it's basically my own landlord. Why not just give me the gift of the home, of the apartment, which they didn't do? My immediate reaction would be, Have my mom move in, though it would be a big change because I run a business out of my house, so it's going to be a little bit tighter. But my mom is very pushing me to move into the house because she feels like we will be able to get into another house.

Pause. Pause. Pause real quick. I'm sorry. This is because I'm not really clear, and I don't want to confuse you or the audience. So you're saying apartment and house. You're currently living in a place, and you said your first was for mom to move in with you where you are now, correct?

Yes, because they just moved out of the apartment which they own that I'm living in to move into their house. So they took on a $400,000- Yeah, not your problem.

It's not your problem, though.

I don't even care about that. In the musical house, this is confusing. So you think the best move is for your mom to move in with you, but it comes with some headaches. That's what I heard. Correct. All right. So if you think that's best, we start there. I can tell you, Rachel and I just said, her house is not your problem, and mom is trying to manipulate you, my viewpoint, to move in to help her with a mortgage that she can't handle.

Yeah, it sounds like there's no boundaries. She's leaning on you almost like a second- She wants to break up with a boyfriend.

Like a parent or a- Him move into your place.

This is wacky. Yeah. Alyssa, is your name on any of these properties from a legal perspective of owning?

My name is not on any property. Okay.

And then they're going to break up. So Alyssa, I mean, this sounds extreme, which would probably piss your mom off, but I almost would just move out, get out of the middle of this triangle, and just go rent an apartment, be a complete bystander in this, and then be able to help and coach your mom, Hey, mom, these properties... Because I bet both of their names are on the apartment and the home, which is going to be a mess for your mom because they're going to have to possibly refinance to get one name off the loan. I mean, It's going to be a disaster. And so if I were you, I see disaster playing out with unhealthy mom with no boundaries. And this would be a harsh move, but it would just say, Hey, I have to step away. And then from your point of strength, be able then to come in and help where you can and where it's appropriate, but not out of this desperation of your mom because she can't get her act together. Are you lying? That sounds mean, but.

No, I Can I add one more thing for context?

Sure. Yeah, absolutely.

I don't think... They've been together for over a decade. So with that said, I don't think that one of them are going to go through the headache of taking each other's name off. They trust each They trust each other enough, although they shouldn't. They trust each other enough, and they know that they're both stable enough to keep everybody's name.

So they may not. How does that change? Okay, great. How does it change what we're telling you that you should do?

No, that doesn't change. You just what? My goal this year was- You just what?

I just, I mentioned the refinance.

I have $30,000. Yeah. So I'm not paying that much. I pay about $2,600 a month in total with everything. My goal this year is I I'm in the baby steps. My goal this year is to pay off my $30,000 in debt, which is more than possible. So I just don't know. It's just going to be more difficult, but I guess- Why? I don't even think of that.

Why is it going to be? What's going to make it If you move?

If I move.

Why?

Yes.

Give me some evidence. You may be right.

I think you can find it- What?

In my area, it's probably going to be more expensive. I am going to need a two bedroom, at least, in order to continue Running my side business.

What is your side business? Out of my home.

What is your side business? I am a waxer.

A waxer? Oh, sorry. Got that one a little late. Okay, great. But I mean, why- Appreciate the service. But that's great. But I mean, all you I mean, okay, two bedroom, that's fine. But you could get a roommate, split a three bedroom. You know what I mean? I would challenge you to find some small studio. I would just look into it.

Do you know what I mean? And the reason to do all this is not really a financial move. It's more of a boundary play because- Yeah, you got to get out of this mess. There's just a relational entanglement. I agree. Now, how's Maura going to handle this? Or you either have to just have a strong boundary with your mom at some point in your life, right? It sounds like you're just the third wheel, and you're the safety net for her when things go south. And that's not a blossoming relationship. You know what I mean? From a daughter to a mother. So I'm just Yes. Yeah.

I would add- I got used to living by myself, so I don't really want to live with her.

Yes, and you don't have to.

By the way, that's going to create a problem. And mom's going to try to manipulate you. I have a good feeling that if you tell mom or you do That's what we're suggesting, that mom's going to throw the darts at you. Am I right or wrong?

That's right.

Okay, so are you prepared? You don't have to be on this call, but I mean, how prepared do you think you are to be able to stand up to that?

I think I'm prepared.

Okay, I hear the emotion.

I can't get you guys in judgment.

Yeah, what emotion? What are you feeling? Fear? Sadness? What's going on?

Sadness to leave her on her own. But I mean, I've told her a million times, my goal is to pay off my debt this year, and I've been doing a great job at that. And this is just because I It's like, I'm going to do something in the middle of that. I'm going to take on a lot more expenses, a lot more stress. I'm going to be farther from work, the job that actually pays me good and that I'm on track to make 100,000 a year for. So it's just, it's a lot.

I know. Well, first of all, you're a good daughter, and there might be some thoughts that enter your head that I'm not a good daughter. Maybe your mom, I'm not saying that she will, but she might throw some statements at you that make you feel that way. I want you to, before you leave us, to know that you're a good daughter and you are making really good decisions for you and your future. You can't, Rachel, how many times have we taken calls with children and adult parents where you really aren't be able to fix mom's stuff.

You're not. And that's what Deloney says all the time is, when you put the boundary up, if the other person on the other end throws a fit and decides to, from an extreme standpoint, in the relationship or stopped, that was their call. You didn't ask for that. You're not wanting to break a level of relationship with your mom. You're just trying to set up your own life. Alyssa, how old are you?

I'm 23. Oh, you're okay.

You are young. Oh, bless you.

You are young.

This is a great move.

Oh, Alyssa, listen. This is going to be a pattern that you set for the rest of your life.

I know you're sad right now, but I would rather you experience the sadness of this necessary ending than deal with madness. For years. This is setting up for that. I don't mean just the angry feeling. I mean like some insanity of this revolving relationship between your mom and this guy. It's so commingled that I think the further you get away from this and set up financial Emotional Boundaries. I think you're going to be great. I'm going to recommend a book by our dear friend, Dr. Henry Cloud. It's called Boundaries. Read it and then follow that up with necessary endings. That's your one, two punch. If debt collectors won't stop calling and you feel like you're drowning, you don't need another company selling debt relief dreams.

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All right, let's go to Tiffany next in Phoenix, Arizona. Tiffany, how can we We're going to help you today?

Hi. My name is Tiffany. I own two properties that are income-producing. One, I have perpetual problems with that cost me at least $1,000 in repairs, and the other one has been vacant for over six months, and I just lost my job, and I can't keep up for payments, and I don't know what to do.

Tell us about the properties. Property one, let's call that one broken, the broken property. What is it? What property is it, and what do you think it's worth, and what do you owe on it? Give us some numbers.

It's a duplex. It's worth probably around 320, and I owe about 260 on it.

Okay. And then let's call the second property the vacant property. Give me the numbers on that one.

It's a triplex, and I owe 406 on it. Yes. They say it's worth 500, but I don't think it's worth that much.

Who's they?

A real estate agent told me that it was worth 300,000, but I don't think that's true either.

Well, you just told us 400,000, then you changed it. I'm sorry. I'm sorry. I wrote 500,000. You said that they said it's worth 500, and you owe 406. Did I get that right?

That's correct. Okay.

Why did you throw 300 out? There's a big gap there.

The real estate agent that I spoke to said he told me because it wasn't selling to drop it down to 300,000. But it's not worth that. It's worth more than that.

Okay. Well, then you need to I've you several real estate agents.

Go ahead. That's the third real estate agent that I have tried to get to sell the property.

Have you tried any of the Ramsey... Well, they're not Ramsey Realty. Our real estate agents that are connected to us in our- Ramsey Trusted program. Thank you. Ramsey Trusted program. Have you tried any of those? No. Okay. Go to our website in the Ramsey Trusted and talk to some real estate agency. You don't have to take those three opinions. At this point, you've got some urgency. So let's find somebody that really knows the market and that is really aggressive. The challenge that you've got is the duplex and the triplex. I mean, those are not your most favorable properties. I'm guessing that you're probably in an area where real estate is slowed down. Is that true or false?

Well, the real estate agents I talk to say that it's good until they put on the market.

I know, but see, here's the other thing. You've got to go get your own data, right? This is not hard to find. You got to get your own research in this thing. By the way, this is readily available. You know your zip code. You can go pull this information from realtor. Com, other reputable sources, and let's just get a knowledgeable- Plus some comps. Some comps on these triplex and duplex. But you definitely need to get rid of these. But what my hope is you don't- Is it the comp? Go ahead.

I I've done that. The comps that I had for the vacant home was $3, was $480. And then for the broken home, the comp was at $320. Okay. I checked on PropStream. Great. I've done the research.

Okay, great.

Great job. And how long have they been on the market for?

Well, the vacant home, I pulled it from the market. It was on the market for about a month For about two months. But I pulled it just to see if I can get a renter because I can't keep up with these payments. Then the duplex- Okay, let's look at your income really quick.

On the market. Okay, so let's- I lost my job. I know. What was your income prior to losing your job?

About 90,000.

What were you doing?

I work in marketing.

Okay, so what happened? Layed off, fired? What happened?

No, I got fired for burnout and stressed out.

What was causing you stress?

My mortgages.

Right. Okay. I think this is a both- I've had three evictions last year.

I still have one.

As being a landlord. You having to do it as a landlord? Yes. Yeah, totally. That caused me.

I had to do turnovers.

How much is each payment per month?

My complex is 2,600, and the triplex is 3400.

Okay. So yeah, that's six grand just in those payments. How far behind are you? I'm not behind. You're not behind. Okay, that's good. So Tiffany, right now, average days on market, and this is across the US, not in the Phoenix area, specifically, is about 78 days. Okay. And we're about to go into a season of real estate, right? Everything starts opening up after the winter, and your May, your April, all of these months really start generating people that are looking to buy. Now, this looks like... I'm assuming you wouldn't be able to sell the duplex and the triplex as separate units. It has to be all probably within one unit. Are you looking for an investor? Would an investor be the type of buyer? Because it wouldn't be a single family. It's not a single family home, right?

No, that's correct. It's not.

Okay, so that is going to make it more difficult because it's more of a niche buyer that you're looking for. But average day, so I would give yourself 90 days to 120. It may have to go through the summer, but the problem is, is if you start getting behind, then yeah, a short sale may have to come into play if you can't get these off.

Well, that's why we need to look at the money right now. So the income. So are you on a severance right now? How long have How have you been out of work?

I just found out this week. I have a month severance.

You have a month severance. Okay. Let me go back, and this is somewhat of an unfair question, but I think it's important. If we had 30 days ago sold those two, let's call these properties. If we had sold those properties, do you think you would have gotten fired?

Probably.

You do think you still would be fired?

What is going on for This has been going on for about two years.

Okay. The stress, and I want you to be really honest, because again, we're protecting you here, but we need to be gut-level honest. Is that the single source of you just simply you couldn't get the job done? You were almost a zombie Because you're so stressed out. Is that what I'm understanding? Yes. Okay, so I want to go back then. Had we not had the stress of these properties, do you think you would have been in a state that would have led to you getting fired? Yes or no?

Right. Repeat that again.

Okay. Wait, if these properties didn't exist in your portfolio and you didn't have any of this stress, do you think you would have gotten fired? Let's go all the way back for two years this has been going on. Would you have gotten fired?

No. Okay.

My point is, you aren't broken. But you are burdened, and that's what's going on. So we got to remove these two burdens. Let me tell you what I do. We have short time here, but I'm going to tell you two things I think you got to do. Number one, I think you need to go get a really aggressive real estate agent, keep finding. But I would not rely on them. Is there anybody that... Are there other duplexes and triplexes around these properties? They're not single standouts, right?

No, that's correct. There are other ones in the area.

I would be knocking on doors and finding who owns them and say, I'm willing to make a deal.

Yes.

And the deal is up to a point that you don't have to pay anything, but you can get out of these things. I don't even care if you profit $1, but as long as you don't owe anything on these things anymore, and we remove It's from your life. It's like taking a giant millstone that's been hanging around your neck and you've been out there treading water, and that is going to lift from you and me. That would be step one. So I would take it on myself to go cut a deal. Hey, I got these properties. I screwed up. I'm stressed out. This is the bottom dollar that I'll take, but I'll take it today. And I would go try to do the deal on your own while trying to get an agent. Now, we've got to move to income. You are going to get free of these things. So you have to sum it up. Every ounce of energy and strength that have, and you have got to get back on the horse. You've got to maybe go back to your current employer and say, I'm going to fix this. I would take that stab.

Give me one more shot. Maybe you don't have it. I understand that may be unrealistic, but I'd put everything on the table. You've got to get out there. If you're working from home, whatever it is, but 90,000 is not going to be replaced by some odd jobs, you're going to have to go back and get into marketing and get in as quick as you can, or you're looking at 4-5 jobs. That's your reality right now because you got one month before your world gets really, really bad. So I hate that you're in this, but here's the good news. I believe in you. You can get out of this, but this is going to have to be like, everything you got to not get broken by this. Statistics show that half of Americans don't have enough life insurance, or they don't have any at all.

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Hey, guys. How are you guys today?

Great. How are you, sir?

Good, good. Hey, I'm looking for some advice on how to I was convinced my wife that it's a smart idea to sell one vehicle that we have paid off that's worth about $32,000 to pay off the other that we have and not have any car payment.

And your wife is not on board with this?

She's not.

So we pay- Are you trying to sell her car?

It is her car. My car is paid for it. It's a 2020 Ferry Silverado.

Oh, okay. Yeah, that's a It's hard. It's hard. It's hard. It's hard. It's a battle, Eric. It is.

It's paid for.

Yours is a truck, and what does she drive? Yes.

She drives a Durango.

And you want to sell her- It's worth about. I thought you said you wanted to sell your truck.

Yes, I want to sell my truck and pay off her Durango.

We need to keep her Durango. And that's why I'm confused as to why she's not for this.

I thought you're trying to sell her car.

Well, she thinks basically the difference of what my truck is worth compared to us paying her car off is about $8,800 to $10,000. So she's afraid. What I would like to do is take that $10,000 and go buy, pay cash for a used car. She is just afraid of what comes with the maintenance and upkeep of buying a used, an older vehicle.

Got it. Okay, now I'm up to date. Okay, so this is all about vision casting, Eric, right? You got to cast vision, and you got to do it in a way Where she goes, Aha, because she's got some fear. Okay, and who among us, Eric, are really clear thinking when we're afraid? Yes, you would agree? Yes. Okay, so nothing wrong with your wife. She got some fear, and it's clouding her ability to see your plan. So you have to come at it that way. All right? So this is the way I would come about it. What is the payment on her Durango every month?

Well, we're paying just shy of double payments on her Durango now. So her insight is, well, why do we need to make this drastic decision?

If we can just pay it off.

Why are we going to pay for it?

Maybe she's right, but you got to answer my question. I'm going to walk you through it. Maybe she's right. So what are you guys paying? I know it's a double payment. What are you guys paying every A month on the Durango?

It's 550.

Okay, 550 bucks a month. That's what the payment is. All right. And if we continue to do the 550, double payment, when would the Durango be paid off?

In about just over two years.

Okay. That's more information. The way I would come about it is, what are you thinking? Because you made a funny, scrunchy face, and I really want to go to you. I want to go to you immediately. No.

What are you thinking? No, it's not off the top of my head. It's just that's so long That's too long. Yes. He's keeping- All right.

I just wanted to make sure.

Cast the vision.

Here's what I would do. I would say, babe, we're paying 550 bucks a month, and at that rate, it's going to take us two years to pay this off. Okay? All right. You do the math on that and just Play it out. Show her the numbers. So that's 24 months at 550 a month.

Multiply that. A thousand. Because he said double payments, they'll have it paid off in two years.

No. Yes. Okay, hold on. The double payment I thought was 550.

No, that's the single No, no, no.

That's the single payment.

I think you asked for it. He didn't give it to me. I said, What's the double payment? You said 550.

Eric, I'm following you, Eric.

But he didn't give me the numbers. So it's a thousand, actually.

Yeah, they're putting away about $1,100.

We're actually paying $975 a month. But in all fairness, I did ask for that number. I said, What are you paying? It's okay.

Eric, I was... I can't ask how much is the payment, and you gave the payment number.

And you said double, and I said, What's the We'll pay you a double payment. Here's the deal.

Anyway, a thousand bucks.

It's $1,000 a thousand bucks. For two years. For two years. You got to show her those numbers. Versus your plan- Which I did.

Well, I actually made a spreadsheet.

Look at you, Eric.

I made a spreadsheet. My anticipation was to have it. We would pay this car off right now.

Let's just get to her fear.

Her fear is- But I'm going to address it. Here's the deal. I'm trying so hard to get here. You got to show her that the thousand bucks a month that we're paying is easily going to cover any mechanical issues that she's worried about. I know. I got you. It's not a village idiot after all.

I got you, Ken.

I feel like I'm talking about teenagers between you two. Oh, Ken. The vision casting is you're afraid- We're going to be fine. That we're going to have mechanical problems. So then you tell her, I'm going to buy for $10,000 a Toyota or a Honda or something for X amount of miles, and I can do research and show her that the average mechanical cost on a car like this whatever.

Yes.

And between our emergency fund and the savings of almost a thousand bucks a month, we would be able to cover the mechanical, and now we're out of debt.

Eric, have you shown her any used cars for $10,000?

I haven't really. I've seen a couple that are locally. It was $8,800. That's a Camry.

So I think that's I think that's always a shocking thing for people. People hear used car, and if I'm her and she's just like, That just means it's a beater. It's going to be crappy. We're going to have to deal with maintenance all the time. You know what I mean? That's the stereotype. But when you actually go and look at used cars, they're fine, really. There's some that are rough that you're like, Okay, that's probably not going to be great. But you go get a mechanic to look at it. You make sure there's no big issues going on. And I'm telling you, yes. And I think for her, that's where the Ken's vision casting could come in, is her actually go car shopping and see what you're talking about. Oh, look at this. Ken's pulling it up now.

That's what I do. That's what I do, folks.

Look at you, Ken. Look at GMC Acadia.

We got a 2016 GMC Acadia for 8,900, only 120,000 miles. Gmcs aren't expensive to fix. They got all the parts. Let me give you- Look, there's a- Oh, my gosh. How about a 2015 Subaru? These things run forever. Let's do one more just for fun. Oh, here we go. Let's go the 2016 Honda Civic, 182,000 miles. Yes, but that car is barely getting started. It looks great. The paint's nice. They're asking 8,900 for it. You walk in there with $7,500 in $100 bills, and you walk out of that. That's just a quick, quick search. So again, I know it took us a while to get there.

She needs to be along with the ride, though.

It was painful, but we got to show her no more spreadsheets. Just, Here's the deal. We just free up $1,000 a month in our budget. We can easily cover, and this is for a short term, and we save up, Rachel, for the next $20,000 cash car.

I even tried to show her that taking what a payment of $577 plus what we're paying and putting it to the house after this car is paid for, we would then pay our house off within the next five years after that.

Oh, my gosh.

And she didn't go for that?

Is really her fear, Eric- She did not go for that. Is her real fear just a used car? Is that what she is scared of for real?

It is. Just keeping up the maintenance. She doesn't think we're... She asked me, she said, Do you really think we're in that bad of shape? We're not at all in that bad of shape.

No, but it's just the level of intensity you want out.

Yeah.

So that's how I would go about it, though, Eric, of what it's doing to you.

It's stressing you out. You hate this. And so to her, she may not feel the pain as much. She's like, Is it really that big of a deal? Oh my gosh, Eric, you're being so dramatic. All this. You need to verbalize exactly what you're feeling and what you're thinking. And it's almost this like, Hey, this would be a gift to me and my sanity and my peace. You know what I mean? It's more of that for you because she's not rattled by this, which is fair.

She does none of our finances.

Okay, so then that's part of the problem, too.

Crazy question. Actually, Eric, this is for you and Rachel.

Okay. Eric, apparently it's you and I against Ken.

Well, it sounded like it earlier until America realized where I was going. Serious question. In this case, is it okay for your marriage to just do it? I don't think you're going and buying anything. You're selling your car. I think you go, We're at an impasse, but babe, I'm going to do it anyway. What say you? Does that bother you?

Yeah, that's a terrible idea, and I would not do that. She would kill me.

She'd freak out. Then don't do it. That's why I asked. Listen, Eric, she's got to come to the table. You guys need to be doing a budget together every month. You're running on two separate tracks, and you're by yourself in this. You're isolated and stressed, and that's the core issue here for you, and that's what she needs to hear. Last thing. Is that her husband is not at peace.

Take her to see you a $10,000 car. Take her to see it. Test drive. Take her along. I think that's your shot. You've worked too hard to get control of your money just to let strangers control your data. Think Think about it. Just about every time you sign up for a newsletter, grab a coupon code, or start a free trial, your personal info, like your name, email address, phone number, and more, gets scooped up and sold by data brokers. Here's the deal. Freedom isn't only being debt free. It's also being free from companies cashing in on your data. And that's where delete me comes in. Delete me's privacy experts find your personal info on these shady data broker sites. They get it deleted and they keep it gone. It's like having a digital cleanup crew that scrubs robs your online life. So you get way fewer of those spam calls, creepy text, and scam emails that make you wonder how they even found you. Guys, the less noise in your digital life, the more time you have for what actually matters. Because when you protect your privacy, you protect your peace and your freedom. So go to joindeleteme.

Com/ramsey to get 20% off their annual plans and take back control. That's joindeleteme. Com/ramsey. Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. I'm Ken Coleman alongside Rachel Cruz. Excited to be with you all. 828-825. 5-2-2-5 is the number. Nate is up in Colorado. Nate, how can we help?

Hey, guys. I'm just calling because I'm not really sure how to move forward. Had a very serious health situation and depleted all of our savings. I'm not sure how to move. I've got four kids and a wife.

I'm not sure how to move forward.

Oh, my gosh. What happened?

Getting out of debt and everything. Long story short, I was in army for a long time, and doctors were trying to help me recover from long-term injuries, and too many doctors got involved, and I ended up on 19 different medications for multiple years. Oh my gosh. And it was just killing my liver. I had heart attacks, and it was really bad. Technically, I'm not even supposed to be here. We were literally planning my funeral.

Oh my gosh, now.

And now I'm here and I don't know what to do. Yeah.

Well, when we say here, where does that put you physically? Are you able to work? Are you on disability? We got to walk through your realities. Let's start with those two questions.

I was supposed to be in the hospital, but I worked through it all. Wow. Through God's help, I was I would like to maintain myself enough to work.

Do you still have that income?

Yes, sir. I still work. I make just over $100,000 a year.

Okay, great. You foresee, God willing, health allowing, continuing to make that money, correct?

Yes, sir. The damage is permanent. There's no fixing it. You can prevent further damage, but what's done is done, basically.

Do you have any other income that's coming in from your military service or anything like that?

That's part of the income. Yes, sir. That's part of the total income I gave you.

Okay, got you. Okay, one last question here, and we'll start walking through the debt. Sure. Do you have opportunities where you are, or potentially in the same industry, to get a raise to where that number goes above 100,000?

I believe so. Technically, yes. That depends a lot on the company you work for.

I understand. But the reason I'm asking, that needs to be a part of this strategy. In other words, you don't have to answer that question on the call, but your homework assignment is What can I do to increase my income?

That needs to be- I'm going to school currently, full-time and working full-time.

For what?

To try to finish my degree so that I can get out of trucking and do accounting.

Okay, so you want to move into accounting. How much school left do you have?

I will graduate next May. Not this May, but next year. It's 2027 May. All right.

How much is that costing you? Or is it covered?

It's free from the VA. In fact, I actually get paid to go to school. Perfect.

Oh, wow. Okay, great. All right, I want to bring Rachel in here and let's talk about the real debt.

Yeah. So how much debt do you guys have?

My wife is two months away from being debt-free. We have two credit cards left. That total, one credit card is $9,487, and the other credit card is $4,619. Okay. Actually, tomorrow morning, that credit card, the smaller one, will be paid off.

The $4,000?

Yes, ma'am.

Oh, my gosh. Amazing.

And then April first... I'm sorry. Between April first and May first, we will finish off the 9,000.

Okay. Amazing. Now, why did you say my wife is almost debt-free? What do you mean by that?

Well, when I got sick, I was actually running my own trucking company. Okay. I'm I'm sorry.

No, you're fine.

I was doing really well. To keep our family afloat, I just went into survival mode. And I just said, Okay, well, if I die, I don't want my wife's credit to get destroyed. So I just focused on making sure the rent was paid and her bills got paid. But my credit, obviously, I I couldn't make anything. I mean, we were barely living. Okay, I hear you. And so I was able to salvage hers, but my credit is just destroyed. Okay.

That's okay. Yeah, I'm not worried about that right now. So are the two credit cards, are those under her name or yours?

Yes, ma'am. They're under her name.

They're hers. Okay. So is that all the debt that's in her name? Yes, ma'am. That's correct. Okay, wonderful. And then what debt do you have?

It's not an overwhelming amount. It's just a lot of small credit cards that have been in default for two years.

That's great. Are they in collections?

Yes, ma'am. I'm sure they are. Nobody's contacted me about it. I just thought it was weird.

Okay.

So I'm not getting phone calls.

It's just there. Okay. So in a way, it's a good thing because when they hit collections, you can negotiate and get out of them. So total, you said it's a bunch of little ones. So probably a total of what? Five grand, 10 grand? Or what are we talking?

It's just under $14,000. Right now, it's just $13,913.

Okay. And they're all defaulted and probably all in collections, all $14,000? Yes, ma'am. Everything you want. Okay. Here's what I would do. I would pull your credit report and see the last company that held that debt and try to contact them and try to get any real time of who owns these debts because they're probably even sold off. It's going to be a part-time job for you to go through the spider web of it all. But where you can get that. And then in the meantime, after you guys pay off her, I'm going to say both of you because we'll talk in those terms, once the $9,000 credit card is paid off in April, then I would save, because you guys are amazing at what you're doing, the fact you guys are snowballing this so fast. I would save 5,000, 6,000 as quickly as possible, and then contact the collections and see what you can negotiate, because I bet they'll take half or even less than half of that 15,000. Okay? So I want you guys to do that. So once that's taken care of, is there any more debt? No, ma'am. No, okay. Yeah, Nate, can I just tell you- No, it's not overwhelming.

It was just terrifying trying to think.

Oh, I can't imagine, trying to stay alive. And by the way, you're a hero.

I'm having a hard time finding life insurance.

Yeah, you might.

I've got $100,000 policy. We just had a baby girl that was not planned.

Yeah.

It's just... I'm just...

You're a good man. Hey, you're a good man.

I'm trying really are to take care of my family.

You're doing great job, Nate.

You're doing so well. The fact that you guys are going to pay this debt off in the next two months and Rachel just gave you a step-by-step plan. Don't stress about that collection stuff. That is secondary. You're going to be fine. You're going to be okay. You just keep showing up for your family the way you have. You're a good man who's been through so much. By the way, you served our country and you sacrificed so much. You are a great American, too, and we appreciate you. You're going to be fine. You're doing a great job. You guys, the next step is get that emergency fund in place, right? And then begin the investing. I believe it's all going to work out. You just one day at a time.

Hold on the line, Nate. We're going to pick up during the break because I do want to mention something about when you mentioned life insurance, I do want to talk to you about that. We can off air. So hang on. Hang on. But yeah, do an incredible, Nate.

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Hey, nice to be with you both.

Thank you. What's going on?

So my grandfather passed away.

Oh, I'm so sorry about that.

Yeah, hey, 96 years old. He crushed him.

Oh, wow. That's a great life.

Yeah, he did a lot in his life. I inherited some stuff from him that I wanted to talk to you about, including a giant Alaskan salmon that he caught in 1986 that somehow got left in the will for me. I'm trying to figure out what to do with that.

Like on a wall? Not why I'm calling you guys. Like on the Can I just tell you? I was like, Is it still in the freezer for the agent?

So it came with a plaque, and he named the salmon Big Hog. And now I have my grandfather's Big Hog, and I don't know what to do with it.

Ken is loving this right now.

I'm so excited. Let's go ahead and get this one out of the way. This is the least important of the question, but we'll see how. What do you do with it? You're hanging in a place of honor. This is your grandfather's prized fish. He went so far as to name it. I would think patio, covered patio would be a great spot. If you've got a man's room in the house, great spot. I mean, it's a story to tell, and it honors your grandfather every time he tell the story. I would come up with a good story. If you don't have it- I would embellish a little bit. I would embellish.

Listen, I wips out the tape measure and found a perfectly suitable place in the living room for my wife. No, not the living room. For reasons I'll never understand. Good.

The idea- Good for your wife. If I've been married long enough, I have. I get it. Notice I didn't mention the living room. That wasn't on my... I know better than that. But wherever your man land is in your house, that's where it goes. Great story. As Rachel said, create a good fish story. Like he almost lost his arm or something like, let's get some drama in it, and then he was okay. He got the fish, reeled it in, took him an hour and a half. I don't know. Something special. Sounds great. But anyway.

This is the type of advice people need to call into their show for.

I agree. We can do more than just money.

By the way, I got more where that came We changed lives in so many ways. All right, so now to the serious stuff.

How can we help you? How can we help you?

Yes. So I found out through his passing, and I'll say this once, very grateful, very blessed to be in this situation, that through the course of three different life events in the future, I'll be inheriting a total, essentially, of 3. 5 million from him. Wow. Yes.

How many grandkids are there?

There's four of us. And it's interesting that you asked that question because one of them is through a $10 million Generation Skipping Trust that some of his commercial real estate assets is in, totaling about $10 million.

So it gets split up four ways. Generation skipping soon. Your parents didn't get- Correct.

It goes to you all. So my parents now get all of the income for as long as they're alive from those properties. Okay. But they're passed along to us ownership-wise in the trust once his children have passed along. So that's way down the line.

Wow. Okay. Oh, my gosh.

The other element is that he's leaving me $100,000 now. I will receive at some point within two years of his passing, which will be two Mays from now. So I don't know when that would be coming. It could come today. It could come in a year, in four months. And then the other element of it is that when my grandmother passes his wife, I'll be receiving a $1 million municipal bond that pays out a lousy 2%. But I'll be getting that when my grandmother dies, that they worked out through their estate, that she gets once he passed, and then I'll get that once she passed. She's 90, and I hope she lives 30 more years. But that's the third element of it. So the reason I'm calling you is I didn't anticipate any of this. And since 2020, I've been building up my own brokerage account with stocks and ETFs, and that account now has 155,000 in it. And my plan was to never touch it. Just keep it growing. However, now that I have these other things coming in the future, my question for you is, is it okay or is it still stupid to be able to pull out money from that brokerage account to pay for some home improvement projects that straddle the line between want and need?

If we have a second kid down the line in a couple of years, we could really use another bedroom. And so for me, and we're doing home construction work here coming up soon, so it would be ideal to get it all done in one slew while it's happening, as opposed to having to move out a couple of times. So is it okay for me to pull 40, 50 out of that now, pay another 10K in capital gains taxes next year, given I know what's coming to me, or is that still a bad idea?

No, I think that's fine. I would say you could pull 40 or 50 out of 150 in a brokerage account anyways, regardless of the inheritance. I mean, that's cash for you all to use now or later, or like you said, never touch it. I mean, you get to make that decision. The whole idea of just never touching that account was something that was a role you put on that money. No one forced that. I would say I would be a little bit more flexible with it. I'm assuming you guys don't have any debt and have an emergency fund in place and everything, correct?

Yeah, about $40,000 emergency fund. The only debt is our mortgage for a thousand months, $500,000 left on the way.

What retirement savings do you have at this point? I know you're a young man, but I'm just curious what your 15% is looking like in BabySat 4.

Yeah, it's, I don't know, normal. I'm 36 years old. I worked professionally for the first half of my professional life, not making much money, so there wasn't much there. Sure. But over the past five years, I've had a pretty good job and have been contributing 4% to it for the last five years. Okay.

That's great. Are you just doing 4%? Is that the match? Yes, correct. Okay. I would be investing 15%, so I would be upping your retirement. I would totally use some of this money in this account, and then that will be replenished with the 100 grand cash that's coming to you in the next year. Now, the rest, the bond, I understand that. But the other big chunk, the 2. 5, that is in real estate, correct? That's not- Yeah.

So that's the current valuation of what is commercial real estate properties in Los Angeles. Perfect.

Okay. Wonderful. So, yeah, that's exactly what I would do, Brian. I know that's... What a beautiful legacy that your grandfather just- Love that guy. Built up, passed down generationally, and still has grandkids intact. Right? Brian, you've stayed out of debt and built up your own emergency fund, your own brokerage. You're doing it. And then that's the beautiful thing is that what money magnifies, and when money magnifies great habits and stewarding money well, that's a wonderful thing. This money is not going to ruin you. It's actually going to continue. You're going to pass that down generationally through your kids and so on. Wow, that's amazing. Absolutely amazing. I would use part of the 150 to cash flow some home renovations, and it's okay if it's a once. That's totally fine. You guys have the cash for it. You're in a position to do it. Then when that $1 million bond comes, when your grandmother does pass, yes, I would probably cash that out and invest that. That $1 million sitting in a brokerage account long term is going to be a beautiful thing, too. That's in the future, which is awesome.

That's huge. That's going to fast forward to your retirement savings. Obviously, if you continue to be as smart as you've been- Yeah, don't slow down your stuff. You guys are in great shape, but act like none of it's coming is the idea here. Then you got a big decision to make. We got to find out where we're going to put that salmon. I think America wants to know, by the way, how big of a fish is it? Did you measure it?

Yeah. Well, the weight... Thank you. First of all, thank you for all that. I appreciate it. The weight of big hog is listed on the plaque. I don't know much about salmon. I asked my friend who's a big salmon fisherman. He told me if it's 25 pounds, that's a huge salmon. The weight of this salmon says 73 pounds. It's huge. Oh, it's three times.

What's the size? What is it end-to-end? Do you have any idea?

Oh, gosh, I haven't measured it.

What would you guess?

Big enough to struggle to get through the door frame.

I could tell you that. Basically, a yardstick, at least a yardstick wide, if you know what a yardstick is. Yes. Okay. Yes. Holy smox.

Kids were excited about that fish.

When you walked in the house. Well, listen, I've heard people talk about millions all the time. When was the last time you heard anybody talk about a 70 pound plus salmon?

That's pretty special. Yeah, not like a tuna. A salmon. A salmon. And they're not saltwater, right? Salmon or fresh water. So that's in a river somewhere in Alaska. That could eat meat. Where did he catch it?

Tell us real quick. Where did he catch it? Yep, Alaska. There it is. Unbelievable. And what's funny is there was a giant bear that had been stalking that thing. Big hog. Brian's grandfather got it. That bear came looking for him. He's no longer there. Where is he? Grandpa got him. If you're waking up tired every morning, you don't need more caffeine. You need better rest. And that's why Casper mattresses are engineered to help you sleep deeper and wake up refreshed. And this isn't just one George's opinion. Thousands of five-star reviews prove it. Plus, Casper mattresses ship free and come with a hundred-night trial sale, so you've got nothing to lose. Sleep is a must, and you deserve the best. So go to casper. Com/ramsey and use promo code Ramsey for 25% off mattresses and 10% off everything else. That gives you up to 1,200 bucks off the Snowmax mattress, which is the exact one I sleep on every night. That's casper. Com/ramsey. Code Ramsey. Exclusions apply. Columbus. Oh, I'm sorry. Couldn't hear myself in my ears, everybody. I'm not having a attack of some kind. The cord got pulled out. I was like, Yeah, hey, I can't hear myself.

The wire's shorting out. That's what's happening. Let me see if I can manually adjust that. Okay, there we go, folks. All right. It's live, folks. You got to keep pressing through. Joseph is up in Columbus, Georgia, and I can hear myself, and hopefully I can hear you, Joseph. How's it going? All is well here in Columbus.

Just had a couple of questions for you.

Okay, go for it.

Thanks for taking my call. Sure. Yes, I am married, 67. My wife is 68, and we both are retired, and we both enjoy traveling. Her a lot more than me. We got a question about getting a credit hard for using those louanges, the Sky Lounge and all those things, the Saturian Lounge. Yeah, I got a question about getting a credit card for those purposes.

You don't want to sit among the people. You want that private experience, huh?

Well, at first my wife wanted it, but then when I experienced it, I thought it was pretty good as well. Yeah, I don't carry any credit card debt, but I I know I did the Dave Rans program back in 2011, and she did it a year before me. And we both have been debt-free since that time. And I just wanted to get your opinion on why do you think that's a wise idea to try to get a credit card for that purpose.

Yeah. So the way I would look at it is choosing to do that. On one hand, some people, it's like, it's just not a big deal. You pay it off every month, you get the privilege of being in the airport louanges and whatever. And then on the other end of the spectrum, it is saying, Hey, I'm going to shift my philosophy around how I do money, and I'm going to choose now to spend on a card that I'm going to have to pay off every month. What we have found data-wise is that you do end up spending more when you spend with a credit card. There is something to be said of, Hey, I'm going to shift my financial philosophy for an hour once a month in a lounge. To me, not worth it. They're nice. I've been in them before with friends, and yeah, they're fine, but they're also just fine. I could sit at an airport restaurant and get a glass of wine and a dinner and call it a day.

You are a woman of the people. You like to be out there among the folks.

No. To me, Joseph, it is shifting into an industry that I I just have a lot of disgust for. I just don't like the credit card industry. I don't like playing their game. I don't like the fact that a lot of miles and cashback and everything, the way they make their money is off of people who can't pay their bills and end up having to pay interest and all of it. I just don't like the game, and so I choose not to play it.

Honest question, Joseph, because it's been a while since I've done any of the louanges, right? But isn't that a function of how many miles, air miles you You don't have to have the credit card to have access to those, do you? Or do you?

Some of them you do.

Some of them, if it's named by the credit card, I've seen those.

But if it's- Like a Delta Lounge.

That's what I'm saying. That you can accumulate if you're flying Delta and you're near, obviously, the world headquarters. You don't have to have a credit card to experience that, certainly if you're flying Delta. I would look into it, but that's just a function of you're stacking up miles and then you get privileges.

Okay. All right. Yeah. That Sounds good. I appreciate your insight on that.

Yes.

Thank you, sir. Yes. Thank you for calling. Have fun traveling.

Oh, I love that. Sarah's up in Las Vegas. Sarah, how can we help?

Yeah, my question is, my husband has a potential job promotion opportunity within the next few months. Along with that is a requirement that we have a five-year-old or newer four-door vehicle that we have to supply, which we don't have right now. And the only way for us to get that would be to use our almost fully-funded emergency fund. So the question is, do we forego the promotion completely because we can't do that, we can't provide the vehicle, or do we use our emergency fund and get the vehicle if we get the promotion?

How much more will the promotion be?

Well, it's base plus commission, so I don't really know. But his boss He was hopeful and optimistic that it could be up as much as double.

Explain to me why the four-door vehicle that's required for this.

Because the job would be an outside salesperson, and he would likely need to use the vehicle to transport things to job sites or whatever. It's just a requirement for the company.

Okay, got it.

Do you guys have a current car you could sell and put some cash towards it?

We do, but it's already a really old, beat-up car. It wouldn't be a significant contribution, but we could.

Yeah, because if it has to be a five-year or newer, if you went on the five-year, how much money are we talking? Are you seeing that you're like, Okay, this is how much we'd have to spend on this car?

The research that he's done so far, he's found things in the 13 to 15 range. But it would be nice to go up as much as 20, but that's more than half of I just want to look at this from every angle possible here.

When would he have to take this job or when would he start? In other words, actually, the better question is, when would you have to have the car if he takes this?

That's not a hard and fast deadline. We don't really know. The job could start as soon as two months from now. The vehicle requirement could maybe be fudged through the end of the year, but we don't know.

Okay. So when can we know that answer?

I don't know.

A lot of I don't. I appreciate the I don't know, but I'll tell you what I would be doing if I was in your shoes. I would be getting the answer to that question. They've offered them the job.

I have asked that question, but I haven't received the answer myself.

Well, who'd you ask it of?

My husband, when he was telling me about this in the first place.

Hubs needs to get these answers. Here's why. It already sounds as though we have a gap here to where... I love how you used to fudge, right? But if they're going to give you a little bit of leeway, you can't be the only people that have ever been in this situation before.

That's where they don't give you any allowance or anything.

Let's just assume it's end of the year, okay? Could you guys, I got to believe, you guys could scrape together $13,000 to $15,000 between now and end of the year.

Yeah, $1,000 a month.

Yes or no?

No. Well, actually, Maybe.

What if you sold some stuff? Maybe, maybe. Rachel and I came over and we were around your house looking around, what could we yard sell? Could we sell enough stuff to make 2,500 bucks?

Even if the car is $3,000, that's 3,000 out of the 13, the other car, right?

It's my point. Here's the exercise, okay? You and your husband, you sit down the night and go, What do we need to do to come up with $13,000 to $15,000? The other thing is he needs to start giving you some answers on how much time he has. Because If he can double his income and it requires us to sacrifice and scrape and sell and go do extra jobs between now and that, I would absolutely do it.

Yeah, but I wouldn't consider this an emergency, Sarah. I agree with that. Because you guys have- I would have a really hard- I don't either.

That's why I'm in this place.

I don't know what to do with this. I would have a hard time because now, if it was in the next 30 days and it's guaranteed, I'd probably pull some money out to get this done. But you guys have to the end of the year, so you have plenty of leeway and runway to be able to save and pay for this car. Now, if you got to take a thousand bucks out of the emergency fund to round it out, that's fine.

To double my income?

Sure.

Yeah, exactly. I think there's some flexibility within the spirit of it.

But I would push hard to say, I don't want to touch that emergency fund and what you guys could do. Do you guys have debt at all, Sarah?

Just a mortgage.

Okay, good for you guys. That's awesome. I would see this as a season of sacrifice.

I think it'd be a fun adventure to go, How can we- We need $1,000 a month.

How do we get it? How do we do that?

How do we generate that? I actually think that's fun. I think it's worth doing. I would talk to Hubs about that tonight. I think in the counter offer, by the way, Rachel go, Hey, listen, I want this. I could do this. You got to give me just a little bit of leeway. Here's my plan. Here's what I'm doing. I think if they want him, it sounds like they do, they can play ball with you.

But it sounds like a good deal. I would buy a $13,000 car to double me.

To double me income? Sure I would.

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Hi. I just want to start by saying thank you for taking my call. You got to put out such amazing content, and this one lets us know it's appreciated. Thank you. Yeah. So I have a pretty complex question, but I'll keep it simple, and then you guys can ask questions, I think, and I'll fill in whatever you need. But Ultimately, my question is, I and my wife are both physicians, and we're pretty financially sound, and my father is not. He has a pretty well-paying job, but still lives paycheck to paycheck, and actually got into some trouble this last year and had to borrow money from me. He's actually collecting Social Security now. He's in his 70s, and he has no ability to retire whatsoever, and so has quite a lot of debt. I'm imagining inheriting these troubles very soon. I'm just curious how you guys would recommend I would go about saying for the future. Well, let's address what you mean by inheriting his troubles.

What are you going to inherit?

Well, I think, ultimately, I think either health is going to catch up to him or he's made some morally ambiguous decisions, and I'm worried that the folks with the phrase eggs are going to come home to roost or whatever.

Well, his debt is his debt. So whatever he's done there from a debt standpoint, that's not coming to you. Now, Yeah, in terms of just taking care of him, though. In terms of.

Yeah, I understand. He's going to be- Sure.

I understand that.

Are you married, Brandon?

Yeah. My wife and I, we're both physicians. We make a decent amount of money. Okay.

How much do you guys make a year?

So I'm in my final year of training now. Next year together, about 500,000 a year is what we're working together.

Oh, wow. That's great. This is always a hard one because on one end of the spectrum, some people put up pretty tough boundaries, and they're just like, I'm sorry, your decisions are your decisions, and I'm not going to have to be responsible for those. And then on the other end, it's like, we're not going to let our parents be homeless. You know what I mean? There is a balance in all of this. So what I would probably do is you and your wife need to sit down and run worst-case scenario. And then I would play out, Hey, what would this look like? How far would we go? And then also put up some boundaries, where I don't like that he's borrowing money from you. I think that either needs to be a gift because it's probably never going to be repaid, right? I mean- Oh, yeah.

It was a gift.

I have no- Okay. Okay. Yeah. Got you. Now, that can be a leaky faucet for a long time unless you put up a boundary of dad. We're not going to give you any more money, or, Dad, I will help pay your mortgage for six months, and that's it, or whatever it looks like. But those are boundaries, I think, in a plan that you and your wife come together and decide, Hey, are we What are we willing to take on? Because you're right. I'm like, If he has no retirement and if something happens to him healthwise, he's not going to be able to work, so he's going to have no income coming in.

What's his Social Security payment every month?

Oh, man, I don't know. I don't know what that is. I'd find out.

The reason is to- I think it's a dicey situation.

He's also a very private person. And for me to be He comes in to invest in his finances. I understand that can be a stipulation if he needs help in the future, that I have to be able to be invited into his financial life. But to do that right now, I think he would blow up.

Great. So here's the deal. You know what happened?

To get you guys like a... I'll go for it.

No, I'm digging, and you just answered your own question. He's super private. He'd blow up or get angry if you weighed in. So you know what you and your wife do? Exactly what Rachel said, and that's it. Don't do anything else. Say, If there's no one else to take care of him, we will. And in that moment, you can do the best you can to guess what his Social Security is. But you go, Okay, he's going to get that until he dies, and that would be the only income he has. We can't assume that he has long term care insurance. We can't assume that he has... We know he has no investment. We know all that. To Rachel's point, you planned for what you would do. You guys are doctors, so you also know the data. If he had to go into assisted living, what is the average amount of time someone lives in that setting? I mean, you can do some homework and go, Okay, absolute worst case scenario, this is what dad's situation is going to be. If no one else can help pick up the bill, then that's something we got to plan for.

I think it's almost like It's almost like planning for your kid's college here. You may have to invest some money.

Where's your mom, Brandon?

No, they're not together.

Okay, they're divorced. Do you have other siblings? No idea.

Yes, I do. But my other siblings are not capable of assisting financially, unfortunately.

What debt do you guys have?

Me and my wife? Yeah. We don't own our home, but are planning buying a home next year. But we're currently, we have student loan debt, but our savings and retirement are greater than any debt we have. We have no credit card debt. We have no car payment. We own both our cars.

Walk us through that. What's your medical... I mean, not medical. Medical school. Student loan. Student loan. Thank you. Student loan debt. What is that? There you go.

Yes, so 300, 300,000 for the both of us.

Okay. Then what do you have in savings?

We have about 120 in savings and about 250 in 401(k)s. Great.

So yeah, I wouldn't touch the 401(k), but obviously doing the Ramsey plan is to pay off that student loan debt. So half of it is in savings, and then what you guys, you'll make 500,000, so you could pay it off in six months. So making sure that you get all that taken care of, of Before you try to take care of dad. Yeah. So making sure that you guys are in a good spot, which I think you will be pretty quickly if you do that stuff and rebuild your emergency fund.

Can I ask how when he... If the debtors come to collect and he can no longer afford his apartment, if I end up paying for an apartment for him, does his debt in the apartment that he lives or the car he drives, that all goes away. But whatever I provide for him is not a part of that equation?

If it's in his name, then it has nothing to do with you. Debts, leases, all of it.

Yeah, but you could furnish an apartment under your name, I'm assuming. However, the apartment complex does that. But it's not really an asset because he'd be renting, but they couldn't come after him in any way with that because it would be under your name. That's right.

Okay. Yeah, I guess that was my fear that his debts would make it It's relatively difficult for me to take care of him.

That's right. I hear what you're saying. It's independent. Does he own a home?

No, no, no, no. Just to get a scope into this, he actually tried to go back to school in the '70s and took out student loans to do that, and then ended up not going to school and just using that money to buy a car.

Stop it. Oh, my God. How much debt do you think he has?

Man, if he told me $500,000, I wouldn't be surprised. If he told me $10,000, I would be surprised. Jeez.

Yeah, well, it- Sorry, you're carrying this burden. It's terrible, Brandon.

But I would tell you this, and I say that, but I want to quickly say, make sure you understand what you're supposed to carry and what you're not. You're the only sibling that's going to be able to take care of him. That's a burden. But you do not have to worry about his debt. You don't have to worry about his mistakes. You understand what I'm saying? All that stuff will be written off. He didn't have a pot to pee in is the old phrase. None of that's going to come back on you. That'll get wiped out. You only have to carry the burden of taking care of dad when he can no longer take care of himself. That's the medically... You can plan for it, but clean up your house first because you don't want that to be a stressor. It's already going to be a potentially resentful burden.

I want you and your wife on the same page, too. I don't want that to be an issue.

We're both very family-centric, and she's like, Hey, whatever we need to do, I you. We're definitely together on this.

If it does come to the point, and you probably know this, of you having to help financially, always give in terms of an actual item, meaning don't give them cash. If you end up paying the rent, you pay the rent and the utilities, get a gift card to the grocery store, and it's like you get 100 bucks or whatever it is as much as not handing over cash because he obviously doesn't know how to handle that. Brandon, you're a good son and a good husband. We're with you guys.

Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. Alongside Rachel Cruz. I'm Ken Coleman. Excited that you are with us. 888-825-5225 is the phone number. Eileen is up next. Eileen, how can we help?

Hi. I'm calling about a trust that my husband's family has. We always thought when he passed or if he passed before me, that I would be the one that would inherit his share. We have found out that it would go half He passed me and to my daughter. We're just wondering if it would be ethical for us to ask her to split the inheritance if he predeceases me.

Just to make sure. It hasn't happened yet. He has not passed.

No, he is still here, and we're in our cities now. We're trying to figure out what to do.

But his wishes are for it to go to the grandkids.

Well, it was set up 80 years ago. The people that are the primaries of the trust are the grandchildren, and my husband would be a great grandchild, and it goes through the family name.

Oh, so it's beyond even your husband's parents, a generation above them?

Yes, it's generations.

So he can't change it, correct?

He cannot change it. It would just be- Why did it- It is- Has it always skipped a generation?

Is that part of it?

It doesn't skip. It just follows the family name. So he gets a trust check, as does everybody else in that generation of the family every quarter. The generation that currently is on those trusts, when they pass, it ends and the money would be distributed.

Right. But then the money is distributed to skipping a generation.

No, only those with the name.

With the name, exactly. It wouldn't skip. If my husband's alive, he would receive it. It's only if he predeceased them.

But what about your daughter if she were to get married?

She would still be the family name. She's the- Got it.

Okay, I'm tracking now. It's the lineage. Which it's following the name through. Okay, got it. Yeah. No, I got to tell you, when you first said it, I was first going to go, I feel like you got to talk to the old guy about it and let him weigh in on it. But it's not his call, right? So it's already been set in motion.

Yeah, they're trying to It's good in the blood.

Yeah, it in the bloodline. I don't want to speak completely on behalf of my colleague here, but we both had a gross face when we heard you say, Is it okay to talk to my daughter and say, Hey, I know this is supposed to come to you by the bylaws and in stone, but how would you feel about cutting us in? I personally would feel gross about doing that. That's my take.

Okay. Yeah. I would say, Elaine, that you and your husband need to set you guys up, that if something happens to him, he has life insurance and that you're taken care of and that you don't need this trust because you guys are in a good spot.

Yeah, we never had it. And it wasn't until we were in our 60s because we always assumed and had never checked how this passed.

Yeah, that's how we- So you guys didn't do life insurance. Is that what you're saying? Because you knew this money was coming. Yeah. So that would not be how I would function more independently of that.

How are you set up for the future? What's your current retirement situation?

We probably have 3: 50, maybe put aside between 401(k)s and savings, et cetera, and another, maybe the- We still have a mortgage.

Did this whole trust issue... Do you think it demotivated Joel?

No. We were in a bad position for many, many years. Okay. Yeah. Do you go in your home? We do. We sell the mortgage, but we probably have- How much is left on it?

$300,000.

$99,000, I think.

Okay, that's great. How much do you guys make a year?

I would say about 89,000 combined.

What will the house be worth?

If we sold it today, over 400.

Okay. All right, so that's getting us near, let's call it 700,000. Okay. Any other savings or anything beyond the house equity and the retirement fund? Anything else?

I don't think so. I don't think I'm missing anything.

Okay. How old is your daughter right now?

Twenty-four. Okay.

How long do you guys feel like you're going to work?

Well, the work we're doing now, we'd probably like to stop by '65, '67 and find something else. We both have more physical jobs.

Okay. The reason I'm saying that is because based on history, Rachel knows this, that that three... How much did you say you had in retirement? 350?

Combined. Maybe, yeah. Probably 350.

All right, so that should double over the next seven years. Okay. Then if you look at your home, so you start adding the numbers up. Now you're looking at, what do we got? 400 on the house. What? 1. 1 million in seven years? I don't know what your social security situation will be, but you start stacking all that up. Whatever you guys can do over the next 7-10 years to invest a lot of money, that's going to help you be far more comfortable in your '70s and '80s.

When you think about it, Elaine, and again, your call is hypothetical, right? Your husband has not passed. Yeah, nothing has happened. Totally, yeah. Again, hypothetically, if If the grandparents are still living for another, I don't know, 10 years, 15 years, and then your husband passed, if he passed away, then technically you would have probably at that point a half a million, $600,000 home that you can sell and downsize, put that cash with the investments, and you'll have well over $1. 5-ish million. You'll be fine without this inheritance is what I'm saying. Okay. Yeah, I probably wouldn't worry about it. I do feel weird saying, yes, ask your 24-year-old daughter for her inheritance. I don't know.

We don't even want her to know that that's the possible amount because we don't want it to take her drive.

Taint her in any way. That's fair.

Remind me, what was the amount that she- Probably around 2 million, but a 24, that could blow through that.

If that were something that happened. But of course, that's hypothetical as well.

They would have to pass and your husband would have to pass.

I appreciate the question. That's where we stand on that. But I think more importantly, your focus needs to be, Hey, we can actually finish well, but we should probably get some intensity and see what we can do from an earning standpoint, certainly tighten things wherever we can tighten to invest as much as we can at this stage. Over the next 14, 15 years, that's going to turn into a sizable chunk for you guys that should allow you some dignity and some comfortability. That would be my main focus if I were you.

Sounds good.

Yeah. Yeah, thank you so much. Yeah, it's a good question. Yeah, thanks for the call.

Rachel- That's a hard thing. I hear that with wealthy families passing on generational wealth, that it stays within the family. I get that in one sense, because It is like, what if dad remarries some crazy woman and he passes and she takes all the money? It's like a drama moment of a movie.

I've seen that a few times.

But you also want there to be a little bit of an addendum of like, okay, if you've been married more than 30 years, the wife can get the money, too. I don't know. Do you know what I'm saying? I don't know what that looks like.

That's very interesting. You mean you give her an out after 30 years? She cashes out?

Well, that Elaine would get the money. If her husband had passed in the will or in the trust.

If she passed, I thought she meant like, I've done my time. I'm out. I'm checking out. It's been a good run, but I'd like to be on my own and travel. I thought that's what you were talking about. No, I get that. I like that. If you've been working the plan, paying off debt, saving, and changing your family tree, I'm proud of you.

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Hey, if you are buying or selling a home, you know this is a big transaction, and you don't want to get caught up in the hype, all the click bait out there, and make you not make the right decision. We want to make sure that you understand what's going on with the latest trends. Give you an idea. Median home prices dipped a little below $400,000 last month. Very typical for this time of year. Mortgage rates also dip to 5. 44% in January. It's down from 6. 27. That's giving buyers some breathing room. To learn more about the housing market trends and get free tools to help you buy or sell with confidence, go to ramsey solutions. Com. Ramseysolutions. Com/market. That's ramseysolutions. Com/market. Elise is up next in Virginia. Elise, how can we help?

Hi, Ken and Rachel. Thank you so much for taking my call. Can you hear me okay?

Loud and clear.

Perfect. In December, my husband's Roth 403(b) was incorrectly transferred into a traditional IRA account and has since made $1,000. Is there any way to transfer the money to the correct Roth IRA account without paying taxes on the whole account all over again.

Who did this? Who made the faulty transaction?

We opened up an account with a financial institution and selected rollover, but it did not say traditional or Roth, and then indicated to the first financial institution that it needs to be a Roth rollover over, but the number listed was a traditional account. Instead of not going through, they cast the check, and then we're doing taxes for this year, found that it was not raw. It was traditional.

Okay. Has he gone in and fixed future contributions, or have you guys not even funded for 2026?

We just stopped funding the account as a whole until we can figure out what we're supposed to do.

Yes. Okay. Well, there is something called recharacterizing the contribution. And so you You may be able to do that without penalty or tax before tax deadline, which is in April. It's coming up. Do you guys have a tax pro that you're working with?

We do, but I'm not sure how much I love our current tax person because they're saying there's no way to do it. And the one financial institution is potentially recommending an excess removal of funds, but I'm not sure if that would trigger taxes on the cost basis of the account.

Yeah, I would get a... Because there's a small lane at which you can do this because it is, from a time period perspective, so quick. And it's only... I mean, the amount, I guess, doesn't really matter. It's more the time frame that you're looking at. So I would probably go get a second opinion. If you go to ramsey solutions. Com, you can check out one of our tax pros that's in our trusted program. And I would get on the phone with one of them and ask. But also, if If that can't happen, if you guys can't be in that lane and you do have to pay taxes, is it just $1,000?

No, the cost basis is $82,000 and then $1,000 of growth. So I don't mind paying taxes on the $1,000 of growth Yes. But it'd be like a $20,000 tax bill for a year.

Yeah, totally. Yes. I would contact a Ramsey-trusted tax pro. Again, go to ramseyolutions. Com. But yeah, to recharacterize the contribution is a way you would do that if you can. But I'll be honest, I'm not 100% sure. Me either.

Again, I appreciate your spirit of saying, Well, I don't like our tax person because they said we can't do it. But let's get a second opinion and a third opinion. If all opinions line up, you don't have to like it, but it is what it is. It's unfortunate. Hopefully, you guys can undo that and not take too much of a hit. But unfortunately, you may just be stuck.

If we do have to pay- What's that? If we do have to... We can always leave it in traditional account, but we're 34 and 35. So by the time we retire, it'd be like 1. 5.

Totally, yeah. So if you have to end up paying taxes on it, I eventually would. You can roll over some per year so you're not hit with an a higher tax bill of 20 grand, but I would eventually convert all of that 82, yes, to a Roth eventually. So again, you can break it up year by year if you need to from the tax perspective, but I'm with you. Yes, if you're in your early 30s, I I would get it to a Roth, but that's so frustrating. I'm hoping there's a way out for you guys if you get a good tax pro in your corner.

And silly question here. Do we know whose fault it was? I hate using the word fault, but was it you guys clicking on the wrong button Or was it a mishap, a mistake made by the institution?

Our accountant says that it's the financial institution's error, and it's their responsibility to fix it.

Okay.

Then that- That institution says it's on our tax person to file the correct paperwork that indicate X amount was a cost basis.

Okay. And your tax pro is not willing to do this?

Either yes Or they're saying it can't be done because they switched it to where you can't recharacterize the entire account. But I do think you can recharacterize maybe a contribution like Rachel's talking about.

I just am not 100 %. I don't know about it. Here's my point. I don't know enough about it. It might be worth looking to a lawyer who specializes in this area.

Because the tax bill is a tax bill.

If it's on the financial institution, I would want to get two or three opinions that are legitimate that would say, Yeah, it's on the financial institution. At which point now you have... You know what I mean? That's where I would be going right now. I would exhaust that and not have to take this on yourself.

That's so frustrating. I'm so sorry. I'm so sorry, Elyce. I'd fight, though. That human error in all of it ends up costing you money.

Bruce is up next in Charlotte, North Carolina. Bruce, how can we help?

Hello, Rachel and Ken. Thank you for having me.

Sure.

I'm a 62-year-old disabled Air Force veteran and a retired social worker. Today, I just bought my 62-year-old fiancée an engagement ring.

Hey, congratulations, Bruce. Congratulations.

Thank you. She doesn't know it yet. I'm going to ask her later this year to marry me. My question is, I earn about 52 grand a year, and she earns about 150 grand a year. We Both are homeowners separately, and so I would like to come under one roof eventually. I live very inexpensively. She has a much larger house, cost a whole lot more, and her interest rate is a a lot higher than mine. I live on that income. I live about 17 or $1,800 a month with everything. I have no debt besides my house. She has no car payment herself, but probably 20 grand in credit card debt. So with that, I would like to know, whose house do we sell first? How do we make this? How do we come together on the one roof? I don't want to live in her house permanently, and I don't mind if she lives with mine until we sell it.

Why don't you want to live in hers? I'm just curious.

Her house is very much hers. She loves having me there, but my preference would be for us to sell both properties and then we have- And buy something together.

Yes, ma'am. I would like that. I do a what-if conversation between now and the end of the year before I pop the question.

What does she want? What does she want to do? Have you guys talked that far?

We have talked that far. She really, really, really loves my house. In fact, she does not want me to sell it because I live on a manmade lake, and it's very pristine and beautiful, and peaceful, and all of that. But it is small. It's three bedrooms and two baths, but it's small.

Does she want to live in that house?

She would love to live in this house, but then when we talk about it, she wants to make it larger and do things that I just don't see the need.

You got a bougey girl, Bruce. I'm telling you. You got to spend her. I appreciate that. That's me at 62. I'm be like, Listen. What I would do is I would come together and have this conversation and just say, Hey, there's probably going to be a middle ground. I think finding a new home for both of you could be great. Selling both. We don't really talk about prenups a lot, but that would be something as you're older and if you guys both have grown children, be thinking about your assets in that way. Yeah, so some things to think about for sure, Bruce, but congratulations. We're excited for you. But combine the money as much as you can when you guys get married and become one.

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All right. All right. Today's question comes from Marissa in Louisiana. My husband and I disagree on what non-essentials to eliminate while paying off debt. I think cutting subscriptions on Netflix, along with purchasing sodas, eating out, coffee shops, stops, pet treats, et cetera, will make a big difference in paying off the amount of debt that we have. My husband thinks those are small in comparison the debt that we have, and we should not cut those things out because they make us happy. What is your perspective on this dilemma? Oh, man. Well, there's just an overarching philosophy that is just true, mathematically, that the more you sacrifice and the more you don't spend on things and the more you put it towards debt, the faster you're going to get out of debt. So what does that look like in a process? Jade Warshaw, her and Sam paid off, gosh, half a million dollars, and it took seven years. So Jade would say there were certain seasons of that seven years of like, Hey, we need a little bit of a breather here or there. But they were pretty gung-hold the whole time. But there were things that they did to survive for seven years, right?

So if it's a long term play, like a major marathon, and I'm talking three, four, five, six years, there may be the little things here and there that cost nine bucks, but it just gives a little joy through it. That's But if you can do this in nine months, I'm like, Cut everything and get it done. Does that make sense? There's a little bit of the longevity approach.

I agree. I think everything on this list I'd cut except for the pet treats, and I'll tell you why. I've got two doodles. I love my doodles.

You and George and your dogs.

But listen, everything... Okay, Netflix, sure. Sodas, sure.

I would pay for a soda. No, pay for a soda.

It's not healthy for you. Too much sugar. Eating out, absolutely. We know what Dave says. You don't see the inside of a restaurant Not unless you're a waiter, that whole deal. Okay, here we go. Coffee shop, overpriced coffee, make your own. But the pet treats, let me tell you why you keep the pet treats.

Oh my gosh, your dog will be fine.

No, they won't. Because my doodle every morning, I get up before everybody else. These dogs, I let them out, I let them back in, and I'm getting my coffee ready. I got a whole process. They would drive me to the brink of insanity if I didn't give them their treat in the morning. Joe knows.

Everyone's nodding in the booth. No, Give that dog a little peanut butter on a little cracker and call it a day.

Call it a day. Now all of a sudden, your missus, Cut the budget on the dog treat. Call it a day. Peanut butter on a cracker?

Sure. That's a treat. That dog doesn't know it's a dog.

That's true. My doozles totally think they're human. Completely.

And by the way, they act like it.

They act like humans, and I love them for it. I love my doggies. All I'm saying is, everything else, I would put the doggie treat in the grocery budget. And don't go crazy with them.

Yeah, now I hear you.

Don't compare me to George, by the way. I hear you. That's a bridge too far. Logan is up next in Dallas, Texas. What did I do?

Oh, no. You hung up on Logan.

I hit the wrong button.

You got so flustered.

Hold on.

I'm so flustered. You got so flustered that I called you George.

About the doggy treats. I'm up in arms. I got it. All right. You got it. There's Logan right there. Logan, I'm sorry, I pressed the wrong button. How can we help?

No, all good. I think I may be the first person in Ramsey history that you all hung up on. Most of the time it's people hanging up on you all.

That's true.

You know, I've never hung up on anybody.

Actually, Dave hung up on someone on Monday.

Next to me.

Yeah. He was feisty and he hung up on somebody.

I got to tell you, I enjoyed it. It was fun to witness, but I won't do that to you.

Logan, we will not hang up on you.

I'll be on my best behavior.

I promise.

We'll see about that. What's going on?

I am calling with a question. My wife and I had our first child in October.

Congrats.

Thank you. I thought we were being very responsible and started saving when we figured out we were pregnant up to our out-of-pocket maximum with insurance. Well, we have now gotten to where we have met that out-of-pocket maximum, but still are receiving hospital bills, and these hospital bills are to about the tune of $1,400. I'm a little bit conflicted with I'm not going to handle that. I have the money to pay it, but I don't necessarily feel like I should. You're right.

I'm looking for some guidance. All right, you are right. If what you're saying is true, yeah, I'd be the worst nightmare of my insurance company until they got so sick of hearing my name. Because if the policy is the policy and you've hit your out-of-pocket, then hold your ground.

Look, I'm not shocked. The billing within the medical world, everything It's horrible. So honestly, it's probably an administrative error, to be honest. They probably didn't even hit something on a computer they should have.

Wait a second. He's got a retort.

What is it?

So we have been down a few on this. My wife talked to the insurance company. I don't even want I don't know how many times. I've been on the phone with them a couple. She has a lot more patients than I do. But all that to say, they are claiming that the reason for the overage is that this hospital, which is in their network, exceeded the amount for a private room that they allocate on the policy. However, this hospital that, again, is in their network does not have any other option. It's not like we opted for some an upgrade to get the fancy room.

It's just the rooms there that cost that much.

See, that's between the hospital and the insurance company, and I would just absolutely fight to the end on that. This is the crap that the American people are having to deal with. I'm so sorry that you're having to deal with it.

I guess the question is, who do I need to fight? Point me in the right direction. Both of them. Is that the insurance company? Is that the hospital?

I'd go to the hospital and I'd say, You aren't going to get paid on this from me. So this is where you guys go to the insurance company and fight it out with them.

Yes. I did that, and they could not help me over the phone. Of course not. I could not get a hold of somebody who had the authorisation to settle. Of course not. The amount. I was told to send an email to some very generic billing email address. So I got on ChatGPT and got some help with professional wording that was maybe a little kinder than what I would have written.

I show up. I would show up. Show up.

Show up. Show up, then just, okay.

Just go, Hey, here's the deal. I got an outstanding situation. You guys want to get this paid on this $1,400 bill. Let me tell you where I'm at. And you've told me to do all this. And I've done it, by the way. I can show you my record of sending the email. Go in there and make the case and go, Hey, I'm not mad. I'm not going to threaten anything. I'm here because I need you guys to get together. And insurance. I just wouldn't pay them a nickel is my point.

Yeah, I would not pay them in.

It's frustrating because there's a lot of people, I have friends now, and I don't necessarily agree with this, but they just don't pay it because supposedly it doesn't count against you financially or credit scores and all that. But That doesn't necessarily sit well with me.

I don't want to just not pay something. You want it resolved eventually.

I'm not saying when I say don't pay it, I don't mean just put your head in the sand, but I'm saying I would fight and put it on them and say, Guys, I'm not going to pay something, and here's why. You all need to figure this out. My policy says this. I've done everything that I can do, and you two need to get together. Hospital, you sent the bill. Insurance won't pay it. That's you all's No problem.

How long, Logan, have you guys been dealing with this?

Our daughter was born in October. So since October the eighth. Well, I say that.

Well, when did the bills start coming in?

It actually took about two months to even get the bills out. So I mean, those started showing up probably late December, early January.

Okay. I'm going to double down on what I said. Now, let me tell you why. Because if you go talk to somebody and you're nice and you are a nice guy and you just go, Hey, I'm here. I'll wait. I got 2 hours today. I got an hour next Thursday. I'll be here. Count on it. Here's what I want to do. I want to show you everything because it's your bill. You have to explain to my insurance company that we didn't get an upgrade. We didn't get the corner suite with the couch pull out. This was the room you gave us. I think if you're kind and civil and you just show them and say, This is your problem, I don't owe this. They've got to figure this out. This stuff happens all the time. You know what happens? I believe deep down, Rachel, this is a conspiracy theory, probably. Love it. I believe they just love to not deal with it, knowing that people eventually give in.

And they'll just pay it.

And I think if you just say, I'm not giving in.

It's the fight. And you hear this all the time with medical stuff. It is. The billing, all of it, it's exhausting. But for that and for your ground, if you want to stand on there? Do it.

Hey, It's your guy, George Campbell here. Do you ever feel like insurance companies only care about your money and not what you actually need? Well, there's a better way. When you go to Ramsey's Insurance Resource Hub, you'll start feeling confident that you're getting the right coverage that's truly best for you. You'll find helpful info on everything from life insurance, health insurance, identity theft protection, and more. And when you're ready to get the coverage you need, you can connect with a Ramsey-trusted insurance pro who will only get you what you need at the best price. Go to ramseysolutions. Com/insurance, ramseysolutions. Com/insurance. Our scripture of the day comes from Philippians 3: 13-14. One thing I do for getting what is behind and straining toward what is ahead, I press on toward the goal to win the prize for which God has called me heavenward in Christ Jesus. Our quote today is from C. S. Lewis, Getting over a painful experience is much like crossing monkey bars. You have to let go at some point in order to move forward. Oh, that's really good. It is. Now, quick question before we move on. Are monkey bars still on children's playgrounds?

They are. They're there.

Okay. I'm happy about that. Me too. My wife and I were talking recently. We were looking through some old photos, and I'll never forget the first time our oldest, who's now 20, we did monkey bars. And I got in trouble because I let him fall.

Oh, gosh, Ken. Sometimes they're super high.

It wasn't. And they were wood chips below, so it wasn't concrete. And when I say fall, he wasn't panicking or freaking out. He was just letting go. And I was right there. And I guided him as he felt because I wanted him to go, It's okay. Yeah. And it was not okay.

Oh, no. Stacey was not happy. She said, Ken, what are you doing?

She had a word.

What are you doing, Ken?

He could have broken his leg, his arm.

All for a little monkey bar. All for a lesson. On the woodchips? A lot of woodchips.

A splinter?

Yes. Might be able to bounce.

Anyway, I learned my lesson there.

So, dads- You remember that 20 years later.

Get that hands up and let them fall. A little bit. But catch them. Right before. And then they're going to learn some trust in you. I was trying to do a deeper life lesson. Did not go the way I thought.

Not for the three-year-old, Ken. There it is.

Be careful of the monkey bars. Amir is joining us now in Philadelphia. How can we help?

Good afternoon. How are you?

I'm doing well. How are you?

I'm good. Thanks for asking. I wish a lot better, but I'm doing good. Thank you.

Okay. How can we help?

I'm about 50 to 55,000 in credit card debt with another 20 on top because of my car. I just needed some advice on how to get out.

Okay. Oh, man. What's the credit card debt? What caused you to go into $50,000 in credit card debt?

Well, I was divorced about three or four years ago now. Okay. And I was just distraught after that. I wasn't paying attention of where my money was going.

Okay. So it was just lifestyle spending, grief spending, just in an unhealthy place in life, and money was a little bit of an outlet to- Yes.

Medicate felt better. Yes. Absolutely. I don't drink or smoke, but Again, just not being as responsible as I should have been.

No, that's fine.

What income do you make?

I make about 60 to 65K annually. What do you do? Truck driver, semi.

Okay. Any opportunity for overtime right now or are you capped?

Absolutely.

How much?

It's hit or miss. To give you a I'd like to answer maybe once a week, once or twice a week.

All right, let's go once or twice a week. We're just ideating for a second. Okay, once, twice a week, over a four-week month, how much extra income would that bring to you?

Over a month, it would bring me maybe 2 to 400 extra dollars.

Only 2 to 400. Okay. Is this open road or is it local driving?

Local.

Okay. So how many hours a week are you putting in driving right now?

Right now, anywhere from 40 to 50. Okay.

And do you have the capability? I don't know what's going on in your relationship life, but do you have the capability of driving an additional 20 hours if you picked up a second truck driving job that had a good hourly rate? I'm thinking 20 plus an hour.

That's the thing. I have a daughter, and we do have a child custody arrangement. Okay.

How often do you have her? Is it every other week or is it certain days of the week?

Yeah, certain days, three days out of the week, and then every other weekend.

Okay. You get where I'm going. One of the things you have to do here is get more income, and that's going to allow us to pay off $75,000 worth of debt. Tell me about the car really quick. How much do you owe? Well, you owe 20 on the car. What is it worth?

Yeah, it's about 20. I'm not sure what it's worth. It's a 2015. It's in good shape with 90,000 miles on it.

Do you think you could get 20 out of it or more?

No, I think I'd be lucky to get 16, 17.

What's the car payment every month?

600.

Do you have good credit?

Absolutely not.

Okay. Because what I was thinking there, Rachel, is do we go to a credit union and try to get out of that car?

Yeah. I would Kelly Bluebook this car, okay? And let's just say it's 17,000. Amir, what I would say is my first goal would be to get a $1,000 emergency fund. And then I think what I would do is start to save and stockpile and see if you can make $1,500 extra a month, okay? And within six months, you'll have six grand. You can throw three of that, 3,000 of that at this car. And so when you sell it, you'll be clean of it. And then you'll have another 3,000 to go buy a really crappy car when that sells. And then that gets you 20. Now you're down to 50,000 of credit card debt. And then you can start really attacking that credit card debt. And again, with what you're making, and if you can work extra, it may take you about two years to climb out of this credit card debt, but you can do it.

It's just- However long it takes, I just need to be pointed in the right direction. I'm pretty dedicated. Once I get the ball rolling, I just need to be told that I can do it.

You can. Listen, let's get real numbers here, okay? If you did $3,000 a month, now this is going to be extra income, and life is not going to be fun, okay? You're going to be working like crazy. But if you can do $3,000 a month, that's going to get you out of this debt in a year and a half. You got to have a- That's that $3,000 extra on top of what I'm on? Yes. Or if you play Rachel's plan here, like she's talking about? We get rid of this car. Then you've got the 55 of credit card debt. I'm talking about that number.

If you freeze up your car payment, too, Mary, that's 700 bucks right there. Out of that, 3,700 of that for Ken Smith is part of that. Really, you're trying to find two extra thousand dollars or a thousand dollars. Anything extra with that car payment that you're not paying that car payment anymore because you've sold the car, that's going to really free up a lot. And you really will start moving. And what's crazy, too, is We talk to so many people. When you're on a journey that 2-3 years, even four years, you may get a raise in the meantime. Stuff happens in that length of time. And any extra money that you have, you throw at this credit card debt. And how many credit cards equal to 50,000? Five. Five. Are any of them in collections?

I think one is.

One is? Okay. Because if any are fall into collections, there's a good chance you can negotiate that down as well. So if that's even a $5,000 out of the 50 or whatever it is, 10,000, you could probably negotiate that for half or even less than half. But where I would start, Amira, is I would get a $1,000 emergency fund. Do you have $1,000 right now? Yes. You do? Yes, ma'am. How much do you have saved?

I want to say about maybe $24, right now. $2,400.

$2,400? Okay, amazing. Not a lot. No, that's great. No, that's awesome. So, yeah, I would keep 1,000 as an emergency fund. I would have that other 1,400 as my get money saved to buy a new car and to pay the difference of this car that you're in. Get that rolling, right? Get the car situation done and give yourself five months to do that. Say by July or whatever it is. Have a time frame. Say by July, my car is going to be sold. I'm going to have enough money saved up to do the difference and buy a crappy car in the meantime. And then start in August, I got a two-year journey to pay off this credit card debt. And cut up the credit cards, don't go near them, and really start moving forward. But if you stay on the line of mirror, we're going to give you the total money makeover book that will walk you through the baby steps, and every dollar will give you a year's subscription. That's our budgeting app that also you can plug in all of your numbers, too, in that, and that can help you through the process.

But we are here for you. Call us back if you need us. But that's where I would start. And you're doing great. You I mean, genuinely, the first step is the belief that you can do it and that you can start something new and change your habits, which making this call is that first step.

Thank you for the call. Listen, remember this, everybody. There's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.