Transcript of Stop Letting Dumb Decisions Control Your Financial Future

Brought to you by the EveryDollar app. 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 and the Fairwinds Credit Union studio, this is the Ramsey Show. I'm Dave Ramsey, your host. Dr. John Delony, host of the Dr. John Delony Show and number one bestselling author, Ramsey personality, is my co-host. Today. The phone number is 888-825-5225. Call is free, and some say the advice is worth exactly what you pay for it. Ann is with us in Nashville. Hi, Ann, how are you?

Hi, how are you? I'm good, how are you?

Better than I deserve. What's up?

So I am calling today because essentially my husband and I have been married 10 years. In that 10 years, we've never had shared bank accounts. Essentially, when I was graduating college, my grandmother on her deathbed told me, "Don't ever let a man control your money. You make it, you control it." And I kind of took that to heart because she never left a bad marriage because she didn't have money to do so. So we're 10 years in and now I'm— I feel completely hoodwinked. Because my husband has been using the money that he has, like using cash. I don't know where the cash is going, but he's been apparently funding his entire life on an Amex card that I just found out has an $18,000 balance at a 30% interest rate. And when I confronted him about it, I told him he needed to cancel the card, that we were going to be eating rice and beans because this was absolutely unacceptable. But he told me he was going to take care of it. He was going to make a budget. He didn't want me talking to him like that, didn't want me talking to him like he was a child.

So yeah, I mean, you suddenly decided you wanted to interfere in his money. Yeah, after 10 years of telling him you wanted nothing to do with him. No wonder he pissed. Well, I mean, I'm over here like, well, I know, but you, you lost all the right to vote on his money when you said, I'm not going to vote on your money.

You, you, you, you decided out of the gate, I'm going to, I'm going to row in my boat, you row in yours. And now you're mad at the direction he's rowing.

Yeah. But my money's paying for our entire life.

So, well, that's not a new thing.

No, but so this is the other thing. So he is disabled and he gets like this pension. And for years I thought this pension was a pittance. Like I literally was like, okay, he's, he pays like the utilities and whatever. Um, well I found out too, this pension is not a pittance. Like apparently, you know, because I'm like paying for all of our insurance premiums, like putting money in a 403(b), putting money into our kids' college savings plans, you know, eye insurance, dental insurance for everyone. He brings home more money than I do now.

Okay, okay, hold on.

You're—

why are you blaming him? This is the arrangement y'all co-created at your direction based on bad advice from your grandma. You're blaming him that he makes a bunch of money and you didn't know about it? Okay, you get what I'm saying? Well, did you ever ask him?

I did, so several times, like I'd ask him, and several times I was like, you know, hey, you know, this is what's going— like, this is what's going on. Like, this is how I'm budgeting things. This is what's going on with everything. And, you know, I'd be like, do you want to like go ahead and start working together? And he would be like, well, I don't know how to change my direct deposit, or I don't know how to do online banking, or, you know, it would always be something, some reason. But then I was just non-confrontational, so I never just you know, try to peg him down on it.

Well, but also he has a very real lived experience that things are going to be done your way, the way you want them, at your direction. You know what I'm saying? There's a difference between, hey, look at all the stuff I'm having to pay for. Do you want to start combining money and do it my way? And him going, nope. Or you saying, "Hey, I set us out on a bad course. I thought the greatest way to keep myself safe was to keep myself disconnected from my spouse. And I was wrong. And I want a chance to rebuild this thing from the ground up. Will you be in this with me? And that means we're gonna combine everything, including our fears, our shame, our embarrassments, and our money. And we gotta be united in this thing." So you see how one of those is an accusation and one of those is a demand and one of those is an invitation. Yeah, right.

But now I'm left with like, you know, I've created, you know, this budget. I have sinking funds. I have—

I know, but listen, you got to change your language. I, I, I, he, he, he. You have to change it to we.

So, okay, you know what I'm saying? I do.

But now we have this like $18,000 credit card with a 30% interest rate doing business poorly.

Yeah.

Yes. So what do I do? How would I tell him?

Send the bill to your grandmother. She caused it.

We have to decide that we are going to do money differently. We're going to be connected and we are both going to get this debt paid off and we're going to decide how we spend money. And I'm going to stop lecturing you and being mad at you. And also I'm going to tell you—

he didn't do anything wrong, by the way.

He's just doing what y'all arranged together.

He did nothing wrong in this thing. He did exactly what you told him to do. He went over there and lived his life. And then you're bitching about how he lived it. You can't do that. You don't get it both ways.

Yeah, you got to come back together.

Yeah, so the two of you sit down, start fresh, and go, okay, I want a do-over. The two of us are gonna become one, like the preacher says, and now you are one. And we're gonna put all of our money in the middle of the table, and I'm not gonna gripe at you about the $18,000. We're gonna cut up the Amex card, and what— and together we're gonna decide what we are gonna spend on fun, what we are going to spend on life, what we are gonna put in the kids' 529, how we are gonna pay the insurance bill. Bills, and we together are putting all of our money, and he gets a vote and you get a vote on how this budget looks.

And if he says, no, I'm not— I don't know, I'm not going to fix my direct deposit, then you all have a much bigger issue in your marriage than just doing money separately. You get what I'm saying?

I guess I do, because it just— I guess it feels kind of like dishonest that he's let me believe for 10 years that he's got this like pittance.

I don't think so. I don't think so. Maybe you are working really hard to make him a bad guy in this, and I want you to reframe that because it's your fault. I really— I mean, that'll be good for your marriage. Just— I got— I got to tell you, I don't want to change my deposit because my wife thinks I've been lying to her for 10 years, and I don't think my vote's going to count in this budget meeting. I'll bet you he doesn't want to change the deposit then.

Yeah.

But I wouldn't either. I wouldn't either.

So, and if you've been saying, hey, I need some help, and he says I don't have any money and he's been lying to you, that's one thing.

That's a different issue.

It doesn't sound like that's been happening.

Yeah, might have, but even then, uh, you know, he certainly didn't come full forward and go, look, I make more than you on my disability check. He didn't do that, and he should have. I don't disagree with that part, but I think you guys get the opportunity to start over. But the only way this guy's going to join in with you is if he doesn't have to acquiesce and lose all power because you shame him into it. That's not gonna work.

It has to be an invitation.

Yep, not gonna work.

Almost all invitations start with I statements. I messed this up, I wanna do this different, I want us to be together, will you join me in this? And it's gonna take us changing the way we do everything.

And you get a vote and I get a vote and we're gonna agree like two grownups together. I'm not your mama and I'm not gonna bitch at you about this anymore.

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Protect yourself, protect your income, protect your family. Susanna's in West Palm Beach, Florida. Hi, Susanna, how are you?

Hi, I'm doing well, Dave. Thanks for asking. And thanks for taking my call. How are you?

Better than I deserve. How can I help?

Hi. So yeah, me and my husband, we just recently got married a little under a year ago.

We're going on a year.

I am 29. He's, um, 29 as well. We're the same age. And we just have decision financial fatigue from trying to decide whether we should continue to invest. Um, I'm kind of going on the route of investing still or pay off our debt. Um, so, My husband and I, we make about $11,500 a month right now, which will be our highest income.

Congratulations.

This is great. Thank you.

How much debt do you have?

We have $85,000 in debt.

On what?

So I have $24,000 on my car. We just paid off his car, which was $26,000. We just did that last month. Um, yeah, so that was a huge lift. Um, so now we're trying to decide, like, do we continue? And then I have $61,000 in student loans, unfortunately.

Gotcha. Okay, and you're 29 years old. All right, so let me— let's pan out a little bit from— instead of looking at the actual situation right there in front of you and ask, what is the goal with your money? Okay, because it'll affect what, what you should do. Okay, so in other words, goal number one could be, I'm gonna live my life wide open right now, I'm going on 6 cruises a year. I'm gonna do whatever I want to do. I make $11,000. That's a goal, and if that's your goal, it's a different answer. If your goal is, I want to live a good solid life, I'm willing to be sacrificial for a short period of time to increase the speed at which we build wealth, which will allow us to be outrageously generous and do anything we want to do, which is the goal we usually are aligning people to. Okay, so what's the fastest way to become wealthy, in other words, so that I can live the life I want to live and change my family tree and be outrageously generous? So what's the fastest way to become wealthy? If that's the goal, then I can help you.

Yes, yes, that would be the goal.

Okay, then the data says stop all investing temporarily and pay off the $85,000 as fast as you possibly can, and here's why. Okay, here's what the data says. We studied 10,167 millionaires, the largest study of millionaires ever done. What we found was, is that they increased the speed at which their net worth went up, their 401(k)s got fully funded, they jammed them up, and they got their home paid off when they got rid of their debt. Because your most powerful wealth-building tool is your income, and right now the bone marrow is being sucked out of your income with $85,000 worth of bullcrap. And so when you get rid of that, it increases the velocity of your wealth building. That's what the data tells us from studying millionaires. And actually, the math will tell you that too. When you think about, okay, all those payments on that $85,000, what if we just put that into an investment? Oh, that's $5 million in 5 years or 10 years or 20 years or whatever it is, right? And so it turns— you can see those payments are mathematically— the arithmetic is sucking the marrow out of your investments.

And so you're trying to do some investing because you want to build wealth. Meanwhile, you're limping along in mediocrity because a large portion of your $11,000 is going to past stupidity.

Yes, very true.

Yeah, and that's normal. I mean, that's normal. So, but, but, um, so what we have found is, is that with your income, you'll be debt-free in about 18 months if you go crazy for a short period of time and say, all right, we're not going out to eat, we're gonna sell so much stuff the kids think they're next, we're not going on vacation, we're gonna clear the stinking 18 $85,000 because it's between me and winning.

Okay. Okay. I definitely see a whole new perspective on it. Um, sacrificing now will get us to the long-term wealth later on.

You had the right goal. The only question is what's, what's the most effective path to that goal. Right. And so that, that, and that's what we've come down to. We figured that, you know, from 30 years of sitting in this seat, I've been answering these questions and helping people become millionaires, tens of thousands of them. And Sharon and I did, and the Ramsey personalities did. And I talked to two of my leaders downstairs a while ago. They just both of them paid off their house in the last three weeks. And both of them said, "Since we paid off our house, that put us at the millionaire, you know, the millionaire net worth." And then boom, with no stinking house payments. Susanna, put that in a calculator. Oh my gosh. Well, you put a house payment in a calculator and you go, hey, what's that turn into in 20 years? It's not a million, it's like 10 million.

Well, and Dave, I think there's, for me personally in my house, there's a whole other side of this equation, which is as the news gets crazy, as the world gets crazy, knowing that like the banks don't care. You signed up to make a payment every month. This student loan payment is due, this car payment is due, this mortgage payment is due. It doesn't matter if you lose your job, that payment's still due. It doesn't matter if your hours get cut, that payment's still due. Taking that stuff off your risk profile lets you sleep, man.

Yeah.

It just changes the temperature and the tension in your home. And that to me is worth as much as my, like my overall net worth portfolio is just having peace in my house.

What's weird is it's not only just that, that then causes you to make different decisions that are wiser and that accelerates your wealth building.

Yes.

That because you're coming from peace. Yes. From desperation.

We've all been approached by a salesman that is happy to help us and wants us to win. And we've also been approached by a salesman who we can already, we know, oh, you need this sale, right? Those are, that level of desperation is just different. And you are more successful. I wanna work with that guy that wants to help me out, not the one that needs me to overspend, right? So anyway, there's the money part, but man, there's that peace part.

And they just do work together.

They work so well together.

It's really cool. So hey, thanks for calling. Joy's in Orlando. Hey Joy, what's up? Good.

How are you? Uh, I was wondering, my dad is offering to be a bank as I'm looking for homes and I'm wondering if that's okay to take him up on that offer or if I should just—

No! No!

Run Joy, run!

Your dad is sweet.

He's awesome.

He's sweet, but don't do it. Here's why. Here's why.

That's what I thought, but I thought I should ask.

The old joke is if you loan your brother-in-law $100 and he never speaks to you again, was it worth it? So the borrower is slave to the lender. And when you owe someone money, even someone as sweet as your dad— and your dad's a really nice guy. I mean, jerks don't offer to give their daughter like bank money, right? So loan their daughter bank money. But when you eat Thanksgiving dinner with your master, even if he's a nice master, it still tastes different.

Yeah, you're right.

And, um, and you're, you're looking over your shoulder wondering if he's judging the vacation you're taking while you owe him money.

Are you married, Joy?

I'm not.

Okay. Yeah, I promise if you start dating somebody or you go get married and you still are in this arrangement, that's going to be real weird between the two of them. Here's what I would do. I would tell my dad, I would take him out for a breakfast somewhere, not super expensive, but kind of nice. And I would tell him, thank you so much, but I want you to always just be my dad.

Aw.

You get what I'm saying? I wanna preserve dad. I wanna preserve that relationship. I don't ever want it to be weird. Let me do banking with banks. I want you to always just be my dad.

And if he decides to gift you $100,000 instead of loaning it to you, you can take it.

Take it all day long. Take, take it all day long.

Oh, that's so funny.

I didn't say— I didn't say you bring it up. I said if he decides.

I mean, you might want to bring it up.

No, that—

that—

yeah, be careful. This is the, um— this ends up poorly. So when I went broke and lost everything, uh, Sharon's dad loaned us money. And Sharon's dad, he's 97 now. He's the nicest man I've never known. He is the sweetest, kindest, gentlest guy. He never said an unkind word. And I got that paid back really, really fast. And it drove me bonkers. Yeah, I couldn't stand it. And Sharon's like, well, it's no big deal. It's just my dad.

The shadow of her dislike was over your house.

Yeah. Yeah. In the midst of having gone broke, lost everything, bankrupted and shamed. Now her daddy has to come bail you out. And I have to eat Thanksgiving dinner there. And he never said a stinking word. None of that's on him. It's all on me. But it proved to me that point. The borrower is slave to the lender.

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Doug is in Philadelphia. Hi, Doug, how are you?

Good. How are you, sir? Thank you so much for having me on the show.

Sure. How can we help?

So I, excuse me, I am in Baby Step 2 of my financial journey and I got a part-time job. I work a full-time job, but I got a part-time job at a big box home improvement store. And when I started there, credit cards were always a thing. I have never signed anybody up for one. I refuse to do it. I have no issue. I, I will never do it. And it was really never a big deal when they would ask, you know, I tell them nobody wants to, already has one. But, uh, they've really been recently pushing, like every day I go in, hey, you haven't signed anybody up for a credit card. Hey, you haven't signed anybody up for a credit card. And now they're starting to offer HELOCs, and they're telling me they want me to start pushing these HELOCs. And my, my conundrum is, is I only got about 9 to 10 months left there before I've completed my goals and I'm actually out of Baby Steps 3. Do I just continue to play that game and say, "Oh yeah, it's fine," or do I say, sit down with my manager and say, "Hey, here are my values, here are my convictions, and I will not push these products onto people when I myself am here trying to get out of debt." Yeah, well, if you do that, you're gonna get fired.

Yeah.

So, um, an easier method would be just quit. Be easier, be easier on everybody. Um, or you can just ride it out for 9 months and, you know, but, but it's the business that they're in and it's— they have now said, okay, you work for us, your job is to help someone find the bolt, the screw, the lock, and to sign them up for a credit card. That's your job. And if you're not doing that, you're not doing your job. That's what they're saying, right?

Yes.

Yes. Yeah. And so, and you don't want to do that. And so I honestly, I think you probably get another job that doesn't require that, that pays about the same, don't you?

Yeah.

Yeah.

I enjoy helping. I have a maintenance background, so I really enjoy helping customers figure out their problems and helping them with their DIY projects. And I enjoy that, doing that aspect of it. And like at first I never had a problem. It was never really pushed, the whole credit card thing, but now it's almost, it's every day I walk in and it's just, I want to say to them, like, I'm not doing that. I will help customers get their product. I'll help them with their problems and help them solve them and fix it, but I'm not pushing the credit card. And I've told my wife, I said—

I understand the moral aspect of it, but the bottom line is, is they own the company and they said this is your job and you don't want to do the job.

Yes, I guess. Yeah, you're right.

It shouldn't be the job. The job ought to be what you're talking about, helping people with their DIY project, and it ought to be fun to do that. I have a friend that back during COVID was bored and he went to work in one of those stores. And the thing that drove him crazy was they had a policy that no matter what happens, if someone wants to return something, you have to take it back. And he had a guy come in that had had a lawnmower for 2 years mowing his grass with it and brought it back, said, "I don't like it." And he's supposed to give him a full credit. And he goes, "That's immoral. I'm not doing that." And they go, "Yeah, you are." And he goes, "No, that's wrong. That guy's ripping us off. We shouldn't do that." And they go, "No, that's our policy. We take it back no matter what." No matter how absurd. And they fired him because he wouldn't take the lawnmower. He said, "I'm not going to do it." And they're like, "Well, that's what your job is. You work for us." Well, that's true. If you work for someone and they tell you this is your job, you have to do the job or you don't get to work there.

I mean, that's a simple thing, right? So I don't disagree with the angst that is created by you here. I honestly, if I were in your shoes, I'd go look for something else. If you want to sit down with your supervisor and say, "Hey, listen, I don't want to cause a stink." I don't want to get fired, and I'm not gonna make some big moralistic speech here, but I'm here to help people with their DIY stuff, and I really enjoy that, and I'm really not gonna be doing this credit card thing. If you think I should quit, if that's the case, you tell me. You could do that.

Okay.

And Doug, can I pass something along to you? And this is the pot talking to the kettle here.

Yeah, absolutely.

How often Do you spend having imaginary conversations with your boss and your owners?

Uh, I've had a couple.

You've had a bunch where you, you're gonna sit them down, you're gonna tell them, they're gonna be like, oh, that's right, that's what's up. And you always have the mic drop moment at the end and it feels so good. Let me tell you this, it's not gonna work that way. Those imaginary conversations are a complete and utter waste of your time. In fact, they're not even benign. They detract energy that you could be spending on loving your wife well, loving your kids well, and being at peace. And so commit to not having imaginary conversations. Either have it or don't. And then seek, like Dave's like, man, you're, you're working a part-time job. Go find another part-time job, man. And then sail off into the sunset. I, I'm not gonna give you my character and my integrity and extra energy that could go to my family. I'm just not gonna do it.

Tara is in Birmingham. Hey Tara, what's up?

Hi, I am a 29-year-old I am 3 years out from school and having pre-marriage discussions with my boyfriend. We neither have debt. He owns his house. My student loans are our big discussion point. I have $301,000 in student loans with a 57% average interest. I—

No, no, no, no, no, no, no. Stop, stop, stop, stop. You said 57%?

5.7?

$5.7 million.

Yeah. Okay.

Dang, Gina, that's gonna be a little different.

Okay.

Sorry.

Who's Guido here? I currently work for the federal government.

Yeah.

And I make $97,000 a year. So I was planning on student loan forgiveness, but I don't trust that it's going to stay around. And we're looking at potentially having kids before then. And I don't know that I will stay full-time. I'd rather set aside money for my own small business, but I have such a large sum of student loans. I'm not sure what I should prioritize, paying it off before kids come or setting aside money for my own business so I can have that option when kids come? No, no.

Here's the thing. I know a lot of veterinarians. We work with a lot of them in Entree Leadership, and I've got several personal friends that were veterinarians. And you're always very, very intelligent people because, you know, a medical doctor only has to learn one body system. You have to learn multiple species' body systems. And so I know that you're a bright person or you wouldn't be a DVM, okay? So, and you worked really, really hard to get to be a DVM, and you sacrificed a lot of your future and $300,000 to get to be a DVM. And so I want to quit and stay home and raise babies. You gave that up when you signed up for $300K until you get the $300K cleared. You're a vet. You're a vet. You signed up to be a vet, kiddo. Now you got to go be a vet, and you gotta get this stinking mess cleaned up.

That's why I want to have my business.

No, you don't. You don't have the money to do a business. You're broke. Yeah, you're $300,000 in debt. You make $97,000 a year and you can make $150,000 a year by just picking up side gigs, working emergency medicine and some of the other stuff, and you need to go to work. You need to work 24/7 all the time and get this out of your life. Now, if you guys get married and you can live on his income, and it sounds like he's very financially responsible, well, if you're making $100,000, you can clean up $300,000 pretty quick, can't you? If you're making $150,000, you can clean it up even quicker.

And if he throws in, if he's got money to add that, that when y'all combine income, that's even faster.

But before you do anything, before we talk about I want to quit and stay home, you don't start talking about starting a business and I want to quit and stay home in the same sentence. Those are incongruent. So you got to decide which you is going to be. But for now, 8 years ago, you decided you were going to be a vet, $300,000 worth of hole worth. And so now you got to clean up your mess. When you're drowning in credit card debt and collectors start threatening lawsuits, a rep from some call center debt relief company can't protect you. A lot of so-called debt relief programs leave people wondering, am I actually protected if I get sued. When all you've got is a legal plan added on as an upsell, of course you feel stuck. But Guardian isn't another debt relief company. They're real attorneys. And with Guardian, you're assigned an attorney from day one. That means if a creditor sues, you're not scrambling and you're not hit with surprise legal fees. Now look, I'm telling you straight, debt settlement isn't pretty. I'd rather see you get out of debt the old-fashioned way. But But if you're out of options and you're staring down bankruptcy, Guardian gives you real protection and a path forward.

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Ask your question today at RamseySolutions.com or click the link in the description if you're listening on podcast or YouTube. Matthew is in Orlando. Hi Matthew, how are you? I'm good.

Appreciate you both taking my call.

Sure, what's up?

Um, so I'm looking to be a first-time home buyer. I'm 27 years old and I have about $120,000 saved up towards, um, how'd you do that? Uh, just staying out of debt for a number of years. It builds up over time.

Look at you. What do you make a year?

Um, about $80,000 after like stocks that my company gives and stuff.

But haven't you heard that all Gen Z's life has been ruined by the real estate market? That it's impossible for you to buy a house, and yet you, young man, went out and saved $120,000. I'm so proud of Well, thank you.

Um, but yeah, I just want to make a wise decision with my first home buy. Um, I think I can comfortably get over the 20% needed for PMI. Um, but I wanted to get as much direction as I possibly could.

Okay. What are you thinking about doing?

I want to buy a smaller home. So something like the $250,000 to $300,000 range. But I want to make sure that the funds I'm putting in are going to give me still a comfortable home that I can enjoy for that range.

Yeah, that makes sense. Well, that just involves a lot of shopping. And so what happens is, I know I have found this when I teach leadership, I often tell guys when they're making decisions, and gals, when you're making decisions, he with the most options and the most patience makes the best decision. They also win the— they also win more negotiations, by the way. So options mean you look at a lot of properties. You don't go look at 3 and buy the 4th one. And you learn, you learn the market, you drive the neighborhoods, you drive them on Friday night to see if it sounds different in the neighborhood than it does on Thursday morning. You, you know, you check the traffic patterns, you learn and you feel the air, and you look at the properties, you look at how old they are, how worn out the appliances are, you know, what am I getting myself into? And you just gather data and let that data soak into your brain, and it'll become what's called common sense after a while. And then you'll make a much better choice than somebody that just moves to town and looks at 3 houses, right?

Okay, you're up. You're a marathon runner anyway. You're not a sprinter. You, you like to go steady. That's your style. I can tell by the way you raise that money. You save that money over time, right? Use that same personality trait to make this decision.

Okay. Yeah, I was wondering about just— I was told like foreclosure was an option, but I'm not very comfortable with that kind of thought. But I didn't know if maybe a home inspection would be an kind of warrant some of the risk that might be coming with that?

You need a home inspection. You need a home inspection and a title policy no matter what you buy. Foreclosure doesn't necessarily mean bargain, and it doesn't necessarily mean the property's trashed, but it could mean both. So you just get in there and dig around, and you go, okay, I looked at 4 houses on the street, they're all $300,000, this one's $150,000. $250,000, but it needs a roof, it's gonna need all new landscaping, and I'm gonna have to paint it, and all new appliances, and the kitchen's got to be torn out. Okay, so I'm gonna have another $100,000 in it, and so I'm gonna have $250,000 in it when I'm done, but it'll be like new. Okay, that might be a deal. Or it's trashed and it's a foreclosure, and they're still trying to get as much for it as everybody else is trying to get for theirs, which happens all the time, by the way. But people buy it and think they got a deal just because it said foreclosure, but it's the same stinking number as the house next door, right? That's not a deal. So you know that, you know, a deal because you've looked at the other ones that aren't a deal.

Gotcha. Okay.

And then, you know, I wouldn't suggest you get into a heavy rehab, but if you need some new bushes and a new paint job, you can probably do that one. But I wouldn't on my first home, 27 years old, old, I wouldn't suggest becoming a remodeler all of a sudden.

Okay.

Just because they do it on TikTok doesn't mean you need to do it, right? Yeah. I got a feeling you're going to do really well, Matthew. That guy's got it. He's got it figured out, John.

Yeah, I like that guy, man. And it's, uh, I think you— the word you use that resonated with me is patience. And for a guy like that, once he flips the switch I'm gonna buy. The real challenge is, can you take 6 weeks or 6 months and just go slow? And the right place will emerge. You have cash and you've got diligence and you've got a good salary. You're good.

Yeah, there's nothing on fire.

Just be patient.

Yeah. Yeah, dig up something that you like the house and it's in good enough condition that you can see it becoming with the money that you have of the place that you're gonna be for a while. Don't call it your forever home because it's not. There's only one forever home, heaven. John's in Detroit. Hey John, what's up?

Hey guys, thanks for talking to me. I really appreciate it.

Sure, how can we help?

Oh man, so about 6 months ago, I had about $250K in the bank. I lived in a $900 apartment, debt-free and owned my car. And I'm a self-employed musician. So I was doing pretty good, making about $50,000 to $60,000 take-home a year. So I decided to purchase a home back in November, put about half down on it. And ever since then, I've been really sick. I actually got sick from the anxiety of owning a home. And I feel like I'm overleveraged. My mortgage is about $1,500 a month. And, uh, Um, I, I recently, I did get sick from, uh, kind of having the mortgage and the stress of it. And then I was in a car accident. My car got totaled. So I ended up having to get a vehicle and now I have a loan on it for about $9,000, $12,000 with warranty. I'm going to cancel the warranty. So now I have half my money's gone. I have about $100K left in the bank. Um, because I was sick, I have uncertainty for the future. And you know, I'm just kind of really frightened about being a self-employed, uh, first-time home buyer. I've been a musician for 30 years and I was actually considering maybe selling my house.

Um, how much is your house payment?

It is $1,500 a month.

You did say that. I'm sorry. No, that's okay. And you make, uh, $4,000 a month.

Uh, roughly $4,000 to $5,000 depending on the season.

So you don't have any other payments?

Um, no, besides my—

and you have $100,000 in the bank, right?

But I, uh, sir, I do have, um, my taxes coming up, which is about $5,000. I have to replace the garage roof for about $3,000. I didn't escrow my property taxes, which I think I might do, and that's about $6,700 a year because I thought I still got $75,000.

And then we paid off the car, so now we still got $65,000, and you have no payments and nothing outstanding.

That's right.

Have you ever owned a home before, John?

No, that's it. When I, when I got in—

are you—

I, I'm 53, and I overpaid for it. It was in the height of the market.

Hold on, hold on, hold on, hold on. Like, yes, you've never done this thing before.

That's right.

So cut yourself some slack, give yourself some grace. You're doing a thing that you've never done before. You've never felt this kind of weight on the squat bar. You got two guys telling us, telling We know you can lift this.

Oh, is that what you guys are saying? So like, it's a bad idea to sell the house.

Here's what is important, and Dave has helped me with this a lot personally, is when I feel something really big, especially about money, it's always important to look at the math on the paper.

Facts are your friends.

Facts are your friends.

The facts are the $1,500 out of $4,000 shouldn't cause you any stress, especially when you got $65,000 in the bank and zero debt and zero bills. And that's where you are. So the stress is manufactured. It's not mathematical. The house is not causing you stress. Your perception of the house is causing you stress.

Amen. Amen.

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Welcome back to the Ramsey Show and the Fairwinds Credit Union Studio. Dr. John Delony, Ramsey personality, is my co-host today. Andrew is with us in Louisville, Kentucky. Hey Andrew, what's up?

Hey Dave, how's it going, man?

Um, better than I deserve. How can I help?

Well, um, so I'm 21 and I got 2 kids and, um, I made some financial mistakes, uh, around the age of 18 and I'm $70,000 in debt now. Um, and here recently I got into a settlement and I'm going to be getting around $250,000. And, um, I'm wanting to play the waiting game. I don't want to pay it off. I just want to let it fall off on its own. And I want the best advice on what I can do.

Fall off of what?

Uh, fall off of my report, the statute of limitations.

No, honey, you owe money. Correct.

I know, but that's—

so how did you get $250,000? What happened?

Uh, so, um, a kid's mom bought him a 3D-printed firearm, or I mean a 3D printer, and he 3D-printed a firearm with it, and he accidentally shot me. And I'm now— I went after her homeowner's insurance policy, and that's what I got out it.

That's the wildest thing I've ever heard. You got shot by a 3D-printed firearm?

Yes. So the handle, the lower handle, the magazine, and then the slide part is all 3D-printed. The only thing metal would be the barrel, the trigger mechanism, and the bullets.

How old was this kid? I'm just curious. This is fascinating.

14.

And he knows how to build a firearm from scratch.

Yeah.

Well, there's YouTube, I guess. Yeah. Wow.

Wild world we live in.

Yeah. That's nuts. Okay. So her, they pay off $250 grand. You owe $70,000 on what?

Um, the Dodge Hellcat. I'll just, I'll put it to you there. I went and got it brand new.

Where is it?

I got approved. Uh, it's gone.

Um, where'd it go?

The only reason they did— it got sold.

Okay. Uh, you got to replay.

Okay. Uh, I couldn't tell you. I have no idea. Like I said, I made some—

you weren't that drunk. Where'd the car go?

It got sold.

And who sold it? You had to sell it. You owned it.

Yes.

Okay, so you sold it. It didn't get sold. I sold it. It. Okay, when you sold it, how— you didn't pay it off? No. How did you sell a car and give title without paying it off?

No title. Um, that's a lot of the deals nowadays. People like cars that way. Um, what had happened was the fuel pump had went out and it was going to cost around $1,500 for just the part alone. Um, and you know As I mentioned, being 18, these days I'm kind of up on, and I never heard anybody buying a dadgum car without a title.

How'd you get tags?

Uh, they— it came with it. They didn't buy it for, um, I guess you would say leisurely driving, if that makes sense.

Are they Too Fast Too Furious?

Yeah, a drug dealer doing runs. And so they didn't— so it's still titled to you?

No, I would say morally tracked track stuff, because a lot of the tracks, they don't require cars to have titles or VINs or anything like that.

All right, so you owe $70,000 on a car that you didn't pay off when you sold it, correct? All of it is that?

Yes, that's it.

Okay, well, when you get your $250,000, you write a check and you pay the people that you owe because you screwed them, correct? Okay, good.

Now we have—

now we have $180,000.

Now my question would be though, could I come at them with, say, $50, a full check?

I didn't come at them with anything. I don't know.

I, I want you to be a person of integrity here, brother. Like, you walked into a place even though you're 18 and you said, hey, I'll give you this amount of money if you give me that car right now, and they said deal, and they made a bad deal, and you were 18, didn't know what you're doing, but you shook hands and signed a piece of paper, bro. Brother?

Correct.

And just because a 14-year-old printed a gun and shot you with it like that, and you have this windfall of cash all of a sudden— thank God you weren't permanently injured.

Yeah. So, man, do us right, what do you make a year?

Um, right now I'm making close to 70 where I'm, uh, located.

Good, good for you. Okay. All right, so you call them up and say, I need to settle this debt, what will you accept? And see what they say. And whatever they tell you, write them a check for that. Okay, then maybe, maybe they'll take 50, they might. Okay, but, and here, one of the things that we find as we've studied wealthy people is not like I was told when I was growing up up, not by my parents, but by people in my neighborhood. They all said wealthy people are crooks, okay? And all the data that we have today tells us it's quite the opposite. And so if you want to become a wealthy person that changes your family tree, that your children have a different life than you had, and then your dad had, and then his dad had, and you change everything, you have to become a person of extreme integrity. Quit doing crap under the table. Cars with no titles. And quit looking for a shortcut on everything. Just do the right thing. Show up for work. Work your butt off while you're at work. And people will notice because that alone is unusual.

And just become a man of extreme integrity. And that would be my prescription for you. If you want to call them and say, all right guys, I owe you this. I did this deal when I was 18. I know you probably got $70,000 or $100,000 or whatever on it. What will you take? I'll write you a check today if you'll make me a deal. And you just, you know, and then just— they're probably— they might say $50,000. $50,000 would actually be a good deal for them. And then the next time you get ready to buy a car, be a grown-up, write a check for the car, buy a father-of-two car, which a Hellcat would not be on the list. Okay? And, um, you know, and pay cash for it and get a title and go get tags on it and be like a functioning part of society. And then that leads you towards being able to grow and to function and to win.

Dave, when I started working here, right, all of this was new to me, and I kept going to these meetings about the Deloney brand. And I remember after the third or fourth meeting, I— I kind of threw a little fit and I was like, guys, I don't want a brand. I don't like that idea. I don't like that word. I don't want that. And Tim Newton, who does all of that here globally here at Ramsey, is one of the most amazing minds I've ever been around. He said, John, all a brand is, is who you are when you're not in the room. What do people think about you? How do they feel about you? What do they know about you when you're not in the room? And that changed changed me. And I want Andrew, when he's not in the room there in Louisville, Kentucky, I want everyone to know, oh, that guy is a man of integrity.

He's a stand-up dude.

That guy, we can count on that guy. That guy's a great dad. He's a great dad.

He's always going to be a great husband.

Yes.

He's a wonderful neighbor.

Yes.

He serves.

They just— that's who that you are when you're not in the room because of how present and generous you are when you are in the room.

Be Be that guy.

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See store for details. Marie is in Phoenix. Hi Marie, how are you?

I'm good, Dave. How are you? Thank you for having me on the show, Dave and John.

Sure. What's up?

Um, I'm wondering if you can settle a long debate between my boyfriend and I. Yeah.

Yes.

I love these.

Uh, we both own our separate homes, um, and we have our separate home expenses, but he stays at my house about 4 nights a week. And our debate is like, should he contribute to rent or some household expenses? And he feels that he shouldn't.

How old are you two?

Uh, I'm 62 and he's 51.

Why are you not married?

No. Why? Um, Um, because we've both been married before and he doesn't want to get married.

Oh, and he doesn't want to pay any expenses?

No.

But he wants to sleep there?

Yes.

Yes, he believes he takes me out to dinner like once a week.

Yeah, you missed the point, I guess. You just went straight away.

No, I get it, I get it. Yes.

Okay.

Why are you settling for this?

Um, because it works for me, I guess.

It doesn't. That's why you're calling.

Well, it's— we've fought over it for years.

Yeah, you should stop that. Yeah, the fighting part. Yeah, you should just— you should decide and end it. One of the—

you know, I, I, um, and the relationship, or—

and no, I'm just saying in the fight, there's a lot of— I don't fight over something for years. I just either get in or I get out of the fight, and I'm not going to I'll lose the fight or win the fight or something, but I'm not gonna— we're done. We're done talking about this. Years?

Yeah.

Yeah. It's like you're all— you're pet hobby.

How long have you all been dating?

About 6 years.

Oh, good grief.

Okay. Okay, so the truth is, the way I answer questions on the show is I try to think about what I would do if I were in your situation. And I can't put myself there because I wouldn't be in your situation. I would get married if I were you guys, or I would move on.

I'd break up with somebody who disrespects me so much.

Yeah, that they, you know, they want to sleep with me, but they don't want to marry me. So yeah, but, but so I can't put my— I'm having trouble honestly answering your question. I'm not trying to make a judgment on you. I'm just trying to say I can't put myself in your shoes. I can't make that work. So can I throw something in here, Dave? I think he has his expenses, you have your expenses, and I think you lose the argument. Then you decide if you want him to sleep there or not. But you have your house, he has his house. You could be over at his house, or you could be at your house.

No, we can't be at his house.

Why?

Because he lives twice as far from our jobs, and I have dogs, and he doesn't want dogs in his house, and obviously I can't leave them here.

Okay, that actually brings me closer to a question I have. I think I'm right on something. I think you're asking him to spend money on expenses. That is your workaround to more emotional connection with this guy.

What do you mean by that?

I mean, I don't think this is about dollars and cents. I think this is about, are you— are we doing this thing together or not? And he is being very clear, we are not doing this together.

I don't do dogs and I don't do marriage. And I don't pay your expenses.

I take you out to dinner.

There's a lot of things he doesn't do. Yeah.

Yeah, I think, Dave, this is less about money and this is more about, like, he won't do my dogs, he won't marry me, he won't make a long-term commitment, so I'm gonna go around this way and see if I can squeeze some emotional connection by you're participating in the bills, you're participating in the rhythm of the house, and—

Some sign of commitment.

Some sign that we're doing this thing together. And he's super clear. Behavior's a language. We are not together.

Yeah.

I sleep with you when I'm at your house, I get what I want. I then go to my, and do my life by myself privately in my own way.

Hmm.

That's a huge, huge, I mean, there's red flags all over this.

And you're okay with that arrangement.

Yeah.

And that's what you want. That's your decision. Yes.

Be a grownup and stop fighting about it. Yeah. Just say, this is the way this is gonna be and I'm accepting it and I'm gonna move on. I'm not gonna choose to be miserable.

Or if you're going to stay in this relationship, I think he wins the argument.

Yes. I agree.

Yeah, I think, I think you have your expenses, he has his expenses, and, um, I'm not going to charge him for a booty call.

And then you get— yeah, you get to decide whether you want to continue in this expense arrangement.

Yeah, yeah, that's what's going on. I mean, it's not— it's, you know, I don't want to be that person. I don't want to be any of these people. But yeah, all right, uh, Natalie is in Boston. Hey Natalie, what's up?

Hi, um, I am just wondering if I should go after my ex-husband's 401k for what? Uh, unpaid child support. He hasn't paid me in about 11 years. Um, we've been divorced 11 years.

Why haven't you done something before now?

Uh, he's— it's a little complicated. He's been in and out of prison, and, uh, I don't know. I, I guess I've, I've tried to, um, file with the state that I live in, and they basically told me can't squeeze money from a rock. There's been times he's been on the street, and he's in there in and out of jail for domestic violence and drug charges. And I think he forgot that this exists because I think he would have cleaned it out if— had he known. And, uh, yeah, so that's where I'm at.

This exists? So you found it?

I— he had something sent in the mail, and I thought I opened it. Yes.

Okay. And how much is in it?

About $60,000.

Okay. And how much are you owed?

Over $100,000.

Okay. Uh, have— how long has it been since you talked to your divorce attorney?

I didn't have one. I think he magically thought that if he didn't show up to court that, um, we wouldn't get divorced. He didn't want the divorce, so So 11 years ago, I just, I did it myself and got granted the divorce and got sole custody.

And when's the last time you talked to him?

Um, last year. Every, every year he'll kind of call and be under the influence and try to say he wants to see the kids or something, but it's not really a—

do you need this money?

Um, or are you mad?

Sort of.

I guess I'm just mad. I'm engaged to be married to a wonderful man in June. He doesn't want to wake the beast.

He said he's left us—

left me alone for the past few years for the most part, besides that occasional once-a-year call or so.

I like him.

Dave may disagree with me. I agree with your— I agree with your fiancé.

I agree with your fiancé too.

You do?

Because I think you saw this number and you got really pissed off, rightfully so. And you felt that you remembered a decade of grinding it out, 3 jobs, not seeing your kids, you remember all that came to the surface immediately.

Right.

And you want to start this whole thing over and you remember how hellacious the divorce was when he wasn't responding to anything. He was like, yeah, I dare the sheriff to come kick me out.

He's a bad dude.

He's not a good guy.

No, he's not a good guy.

So I, yeah, and lastly, I'll tell you this, I don't know the answer to the legal question and you'd have to find someone that does know the answer, like an attorney, if you wanted to ask someone. But as I understand it, a 401(k) cannot be touched by a lawsuit. I know that part is true. I don't know if that is true on child support, if child support would violate that or not. And so I'm not sure you can get to it anyway. If you want to put that part to peace in your mind and go, well, I can't get it anyway, way, then unless he voluntarily pulls it out and gives it to me, you can make his life miserable like it didn't already until he made it— until he pulled it out and gave it to you. But, um, or you can take the cinder block that is him out of your backpack for good and like just walk away.

You've got a good new guy that you're marrying with, you're going to create a whole new life, your kids are stable and healthy because of the awesomeness of the last 10 years, the grinding and just making it all work that you've done the last 10 years. Yep, man, choose peace over this one. That'd be my opinion. You go burn them to the ground, but you're gonna get— you're gonna get burned too.

Yeah, that fire's hot. And I don't think you can get the money anyway. I'm not sure. I don't know if you can get it or not in a 401k with child support. But if it was a regular lawsuit, I can tell you you can't get it. It's not accessible. It's accessible in a divorce. A divorce attorney or a divorce lawyer, probate, can make you split up a 401k in the process of a divorce, so they may be able to do it on child support. I don't know, but I think overall you don't need it and you sure don't need him around. So I'm with your fiancé and John.

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Good, how are you?

Better than I deserve. What's up?

Okay, so I'm 24 years old, and I've been working since I've been 15. I haven't built any real savings. Savings, and I put all of my, my expenses on a credit card. I have like $2,000 to $3,000, and, uh, that I spend a month on my credit card. And after I pay that off, I pay it off in full every month, but after I pay it off, I only have like $100 to $200 left. I, I basically live paycheck to paycheck, and I've been living like that ever since I started working. And I do, I use the college savings that my parents had for me as a down payment for a duplex and I rent it out. But whenever big repairs come up, I have to borrow money from them to pay it off. And I just want to stop doing that. I want to break the cycle and start saving money, stop using my credit card and just breaking the bad habits of spending money like it's no tomorrow.

So you make about $3,000 a month?

Uh, I make like, yeah. Like, yeah, $3,000, $4,000.

Okay, but you said you put $2,000 on the card.

I put— it's usually my— every time my, uh, it's usually like $3,000, uh, around there on the credit card.

Like, I put all of them.

What do you do for a living?

I work for the post office.

Okay, and what's the duplex worth?

Um, it's— I got it with, uh, equity. So I got it with $20K in equity. It's worth $250K right now.

And what do you owe on it?

Uh, basically $230K.

Okay. So it's really not a big blessing. It's more of a curse.

Uh, I would say, uh, I—

it costs you money. It doesn't make you money.

Yeah.

Yeah, yeah, sell it.

You think so? Well, I'm trying— I'm wanting to use that as like a retirement plan.

It's not a retirement plan. It's not. It's draining money. It's not adding money. It sucks money.

I get rental income from it.

Honey, it costs you more than it makes you.

Yeah, Evelyn, the only way you can go forward here is to exhale and say what I've been doing is not working, I'll try something else.

Yeah. And what do you, what do you guys like suggest? Like, the truth is I understand I have a spending problem and like, I, I don't think you do.

I think you have a systems problem. I think the system you're using to handle money sucks. So what would be wrong with just cutting up your credit card and paying cash for things?

No, nothing, honestly. I think I've just done it so long.

I know, but just, just let's try something new. This sucks. You called me because it wasn't working. So cut up your credit card, take your paycheck, turn it into money, pay cash for your groceries, put some money in a checking account and use a debit card or whatever to pay your light bill, pay your landlord. I assume you're renting.

Uh, no, I actually live with my parents.

Oh, okay.

Yeah, okay. So you don't have any overhead, you have $3,000 a month coming in, you got a car No, actually, I don't have any debt, actually, other than the house. Yeah, okay.

Yeah, I mean, what if you cut up your credit card and just took your paycheck and used it to live on?

Yeah, I mean, it's the same thing.

It's the same thing you're doing.

No, yeah, yeah, okay.

Yeah, use— jump on, on the App Store and get the EveryDollar app and put it on your phone. Phone and say, I got this much coming in, $3,200 coming in this month, and I'm going to give every one of those dollars a name. If you want something different than you have now, you're going to have to do something different than you do now. And right now I'm listening to you, and I've been coaching people with money for 35 years, and your duplex idea is broken. It sucks. It's taking money from you. It's not adding money to you. You're living like a 12-year-old in terms of how you're handling money. You just spend it until it's gone, and then you're not— you have no emotional connection to it whatsoever. I'm asking you to be an adult, step back, and get over the top of the money and tell the money what to do. Before the month begins, on the EveryDollar app, make every one of those dollars behave, and then go do that exact thing with that money, and you're gonna be no worse off. You're actually gonna be better off because you're gonna be in control of it.

And right now you just spend until you run out and you're stuck at your parents' house at 24 years old.

And so on top of that, on top of your post office job, I want you to go get a second job. You're 24, you're unattached, you're living at home. Go get a second job so you can start earning more money than just 3 or 4 grand a month, and you can sock that money away and begin to build yourself an emergency fund, begin to build yourself a financial cushion so you can get your own place one someday. Yeah, right now is the time to work like crazy.

Get your own life as soon as possible. As soon as possible. Hannah is with us in Newark, New Jersey. Hey Hannah, what's up?

Hello Dave and John, thank you for taking my call.

Sure, how can we help?

My question is about charge-offs and how long they stay on the credit report.

7 years from date of last activity.

Okay, all right. So I have one in which it's recorded that on my credit report I paid it all— I paid my last payment, not paid it off, but my last payment was in May of 2019, and that's exactly the same month and year they closed Closing it doesn't matter.

The date, the last date you paid on it or used it in any way, the last date there was any activity on the account, 7 years later it will not be on your credit bureau report. Spoiler alert, spoiler alert, that doesn't matter. They still will sue you. Whether it's on your credit bureau report or not doesn't matter. They still— it's still a legal debt.

That, right?

Dropping off your credit bureau report does not help you.

It only helps you go borrow more money.

Well, I'm not interested in borrowing.

That's what I mean. That's why Dave says it doesn't matter.

But I just wondering— but you're— but I was just wondering how long it takes to come off. And you said 7 last—

7 years from the date of last activity, and they could choose to to do a report on it and start the 7 years over, because that's— inactivity coming from them is also activity. So what kind of debt is this?

Okay, well, it was credit card debt.

Okay, and how much is it?

It's like $6,000 something.

And what do you make a year?

$50,000.

Okay, do you have any money at all?

No, not right now. Not right now. I'm trying to save up.

If it drops off in May, and I don't think it will probably, it usually— they download the data on the credit bureaus once a quarter, and so May would be the 7-year date, and sometime in the following quarter it might drop off. Okay, and if you called them and offered them $500 cash as settlement in full, they might take it. And that would clear up the debt.

It wouldn't be paid in full, just settled.

Settled in full, and it'll be on your credit bureau as settled, a bad debt that was settled, for 7 more years. Doesn't keep you from doing anything, but it does keep you from getting another credit card, hopefully, for a while anyway. But that'll get it actually out of your life, to settle it with them. And super old credit card debt, they will settle for pennies on the dollar. Get it in writing and do not give them electronic access to your checking account if you're going to do that.

Corey is in Baltimore. Hi Corey, how are you?

I'm well, Dave, how are you?

Better than I deserve. What's up?

Uh, so I am currently trying to figure out if it would be a good idea or if it's morally okay to, um, accept a position at a job knowing that I may be moving to another state or area as early as July and as late as December.

Okay, what kind of a position are you talking about accepting?

So I would be transferring from my current— I work within a school and I would be transferring to another building within the district, but I don't want to take another— I don't want to accept another position knowing that I may be gone I heard that.

What kind of a position are you talking about? You're asking me if it's morally acceptable to do this. What is it?

I'm a social— I'm a school social worker.

Okay, so if you take this, you're going to move from one school to another as a social worker?

Yes.

Okay, and so, um, well, a good way to test ethics is very simple. Treat other people like you'd want to be treated. So the supervisor and the principal at that school where you would be going, if you were sitting in their seat, how would you want Corey to handle this?

I would want somebody who is being forward with me and, um, you know, is being honest about the fact that it may happen or it may not happen.

Yeah. So what is it, what is it dependent upon? What, what would cause the move to happen?

Uh, accepting a job in that area.

So you're continuing to look for a different job while you took the new job, but in a different state?

Yeah, we were looking to relocate.

We—

December— my family and I. Yeah.

Oh, does your wife have a job?

She— yes, she does.

In the new place?

No. So we're both looking to relocate, but that's kind of what is delaying us now because we haven't found anything in that area yet.

I would take the job. The chances of this all working out on this timeline that you've imagined is slim to none right now.

Neither one of you have a new job in the new place yet.

Are you a finalist for a job in a new place?

No, it's just, uh, she's from that area, so she— we're wanting to move back down.

So right now it's just a discussion. Yeah.

So where did you—

where'd you come actually talked to anyone about being hired there yet?

Yeah, where'd you come up with July or December?

We've been applying places, but we haven't got anything back. But yeah, we've been pretty active about it but haven't heard anything back.

Well, the answer to your question— you answered the question yourself. The answer to your question, is it morally acceptable to take the new job? The answer is yes, if you tell them, I think we might move I'm not sure yet, and I want to give you a heads up on that before you give me this position. And then based on that, they have to make their decision as to whether they want you or not.

In this school district, would that conversation cost you your job?

I don't think it would cost me my current job.

What about the new one?

It could potentially cost me the new one.

Okay, then stay where you are.

Is the new and more money a promotion of any sort, or is it just a different location?

It would be a better work environment.

Yeah, okay. Well, I think you just have to be upfront. I mean, that's how I would want to be treated if I was the principal at the new place. I don't want to go to the trouble of onboarding a guy, going through all the paperwork crap, everything else, knowing he's gonna be gone in 6 months and he didn't tell me. Yeah, if you're going to work for a company, I— in an executive-type role, I 100% wouldn't hire you. But if you're going to work for the local coffee shop as a barista, well, they turn over like yesterday's underwear anyway, so it doesn't matter, right? So it depends on the environment that you're going into. Is high turnover situation I mean, if you're going to work at Home Depot as a clerk, they're not expecting you to be there in 6 months anyway. So, but here you're kind of making a commitment, so you need the people you're making a commitment to need to make their decision based on the actual knowledge of what's going on. Otherwise, yeah, you're misleading them, and that is unethical. I agree with your— I think your conundrum— I think your heart was already telling you that, wasn't it?

Yeah.

Yeah, and that's why you asked the question. You wouldn't ask the question if you didn't make conscience about it.

So, but I would also say, like, I'm trying to imagine— I worked in education for 20 years. If somebody came and sat down and said, hey, thank you so much for this opportunity, I want to be honest with you, my wife wants to move back to be around her family.

We haven't found anything.

We haven't found anything.

That might happen someday.

It's going to take us both getting jobs. It might be 6 months, it might be 6 years, but I just want to put that on the table that we do have a family vision of going back home one day. I, I would I'm going to, I want you on my team for that level of integrity. And I would take the gamble, probably it's not all going to work out in 6 months. And so if you're a great social worker, man, there's going to be schools lining up for you to come work for them. So that I, yeah, I be honest, but also tell the whole story and then let the chips fall where they fall.

You tell the story and then you can let, you can sleep at night and you go, okay, they didn't want me because of that. I'll stay where I am.

Fair.

And so the price of me, The price of my integrity is I get to stay in this place, this less good environment, while I look for a new job in another state.

That's right.

Yeah.

And that's always, always, always when you get to the end of your life, a good thing that you did it. Jaden is in Oklahoma. Hi, Jaden, how are you?

Hi there, I'm very well. How about you?

Better than I deserve.

What's up? Hey, well, I'm curious about if I'm being maybe a cheapskate about buying an engagement ring.

Yes, 75 cents Dave Buster's, turn the knob, brother.

If you have to ask the question, you are. No, I'm kidding, I'm messing with you. So, uh, what are you thinking about spending?

Uh, right now I'm thinking about $4,000.

Okay, and what do you make month?

In a month, I make $5,000.

Okay, that's okay with me. That's not cheapskating. I tell, I tell people no more than a month's income. The jewelry store tells you 3 months income, but they sell jewelry.

Kelly's producing the show right here. She just passed out.

You don't like that, Kelly?

Um, she wants about 7 or 8 months.

Wow. Okay, so here's the thing. There is no direct correlation between the length and quality of the marriage to the expense of ring. As a matter of fact, there might be an inverse correlation, that the more expensive the ring, the less likely you are to actually make it.

Where is this cheapskate idea coming from, you or from her or your buddies?

It's more from her. She's done some, some really beautiful rings, and I'm more like the 6, 7, 8 kind of range. But we're both still in debt, and I'm just trying to figure it out.

All right, have you— have you—

well, the difference in 4 and 6 is not a deal breaker one way or the other.

No, but have you had that conversation with her?

Yeah, she said she wants the same.

We've sat down.

No, the conversation underneath the conversation about, hey, we both owe a bunch of money, and I know you— I would love to be able to buy you an $8,000, $10,000 ring. I don't have that kind of money. Do you want me to save up and give you this? Like, have y'all had that conversation?

Maybe not the way you're posing it.

If you can have that conversation, it'll set you up to have a great marriage for the rest of life. Yeah, because that's marriage right there, being able to have the question that is actually the question beneath the thing y'all are fighting about.

Yeah, and here's the thing, it doesn't have to be forever either. It's one ring. So Sharon's is a— her engagement ring's a 0.23, means you can't even find it with a magnifying glass, it's so stinky small.

Man, talk about she bought low. She bought low.

0.23.

She ROI'd that one, man.

Yeah, well guess Guess what? The thing she wears on her hand now is causing carpal tunnel syndrome. So I only have one working headlight. I have to have a freaking spotlight.

Because I look directly at it one time.

A spotlight that you bring in Hollywood actors with. That's exactly right. But yeah, we traded the.23 and it's in the safe. We kept it for sentimental reasons, but not for value reasons. And it's worked for 44 years. So yeah, I think that the conversation around it, Jayden, is more than the cost. Yes. Is more important than the actual cost in this situation. So, but somewhere around a month, and 4 to 6 is somewhere around a month. You're right. If you told me 18,000, now we got a different problem.

Now you're in Kellyville, and that's a whole different level of drama.

Welcome back to the Ramsey Show in the Fairwinds Credit Union studios. I'm Dave Ramsey, your host. Dr. John Delony, Ramsey personality, number one bestselling author, is my co-host today. Ray is in San Jose, California. Hi, Ray. How are you?

Hey, Dave. It's such an honor to talk to you.

You too.

I have a question. I am— well, a little backstory. I'm 36, newly married. I'm working on a debt snowball, trying to get my and my husband's new life in order. Um, and I have an uncle who is 78 years old here in California who has asked me to be the executor of his will. Um, in that he said he wants to bless me with his rental property in Arizona. Um, in that will, uh, it sounds great right off the bat, but I know you're the expert on real estate and I just, while he's still here with us, um, is there anything that I should be prepared of? I don't want to walk into a rude awakening, um, when he passes and, you know, if there's $8,000 left on the mortgage or any repairs or taxes and here I'm trying to clean up my life and I get stuck in a bear trap.

Okay. All right. Does he own a lot of other assets as well?

Um, he has a, um, kind of like an elderly mobile home that he's leaving to a nephew of his. And so I kind of looked in the will and I said, you know, I said, well, if there is a mortgage left, which is $8,000 as of today, uh, how would that be taken care of? And he said, well, I would want you to use the money in my bank account. And I said, well, that's not in your will. So, um, the good news is we have a meeting with his, uh, estate planner in May. And so I kind of just wanted to call on this show and get my ducks in order.

So he's going to give you the property. What was he going to do with the money in his checking account? Who was going to receive that?

Will? With the mobile home was going to be the nephew.

Oh, okay. So the mobile— nephew would get the checking account and the mobile home. The house in Arizona, does it have a mortgage?

It does. There's $8,000 as of today left.

Oh, that's the $8,000. So there's no money coming to you currently to pay off that mortgage?

Correct. From what he's saying is, oh, just use the money in my bank account.

And I said, well, then you'd have to leave me the money in your bank account.

Account, right? So I'm like, let me call Dave and get my stuff in order.

So the will needs to state that the cash, that $8,000 cash comes to you, other cash and, and, um, any other cash above $8,000 and the mobile home go to the other nephew, your cousin, I take it. And, um, then you have a paid-for house that you're receiving. Do you have any idea what this house is worth?

Uh, right now it looks like $300,000.

Okay, so wonderful gift.

I've never been to Arizona.

Well, you're going to sell it, you're going to sell it right after he dies, correct? Yeah. And you're going to use it to have your life, you and your new husband's life, and you're going to pay off whatever debt you've got and/or build wealth for you and your kids and your husband, and you're going to go forward. We do not need a rental property in Arizona. So an executor, if you look at the word executor it has built into it the word execute, correct? So your job, if you're the executor, is to execute what the will says. So you're very wise to do what you're doing and make sure that you agree with what the will says. And that is— there, the only other question I've got is, who's gonna be pissed off that got nothing?

He doesn't have a wife or any kids. It's just this um, this nephew and myself that he says he could trust.

Um, what about your mom or dad? Whoever's his brother?

Uh, mom or dad, whoever. He's a second uncle. So, um, my dad, my dad, um, isn't left anything.

So is that going to be a problem between you two?

Um, let's be real, probably.

Okay, okay.

Then you all need to talk about that before he dies. Yeah, yeah, he needs to, he needs to tell your dad that I'm leaving this to your daughter and I'm leaving this to your nephew.

Correct, correct.

Because I don't want you to inherit drama. Your job is not to execute drama. Your job is to execute his wishes in the will. And sometimes people don't— they, they piss people off after they die rather than while they're alive. And so that's the— that is the case here. So I would make this to where it's a slam dunk. There's no question. Nobody's mad. If you're going to be mad at You need to be mad at the uncle while he's alive.

Right.

Yeah, not you. You didn't do anything.

I appreciate that. Last question. So when this property comes in and sold and it's paid off, then the only thing that comes out of the sale is the taxes of Arizona or any repairs to get this property up to date so it can sell, and the real estate agent gets their half and we call it a day?

Yep. Not their half, but they get a commission. Yes. And call it a day. And there's no, there is no income tax on this. If you inherit it at death and sell it within 6 months, market value is the basis, so you won't have any income tax.

Oh, I didn't know it reset the basis.

Stepped-up basis on death. Yeah.

I did not know that. So she's not gonna have to pay capital gains tax.

No capital gains tax on it at all.

If she holds it for 5 years and it goes up to $600,000, then she'd pay taxes on the $300,000 increase. Excellent. I didn't know that. Okay.

Yeah. If you sell it within 6 months, it's per it's supposed that you sold it for market value and at time of death.

Dave, would you sell it right away?

Yes, instantly.

Okay.

You don't want to be a landlord.

There's no point that you had $300,000 piled in the middle of your table, the kitchen table, and you went and bought a rental house in Arizona.

In a state you've never been to.

Yeah, that's not even a possibility. So, you know, and that's reverse engineering, which is called a sunk cost analysis, and that tells you to Don't do it. Don't keep it. Don't keep it. Don't keep it. Don't keep it. This is why people keep it. We moved from Atlanta to Chicago and kept our house as a rental. That's a landlord by default. And that always is a recipe for bad things to happen, like someone changing their Harley oil in your living room. That's when this kind of crap happens right there. That's exactly what happens.

Bad idea.

Bad idea. Idea. So yeah, you're, Ray, you're approaching this with a lot of wisdom. You're the executor, you're gonna have to execute, and you've already realized that what's in the will, and there wasn't money to pay off your house because the will didn't state what happened to the checking account money. And so now you're having that reworked with the lawyer. That's wise. I would also just ask your uncle to call your dad and say, hey, I don't want you to be mad at anybody. I'm leaving this to your daughter, and you need to be happy for for her. And your uncle can do that, and it'll keep your dad from getting himself twisted. And if he wants to get twisted, he can do it now instead of at you later, and you don't get into all kinds of drama over a tiny little estate of an old trailer plus $300 grand. And—

but Dave, we've taken the call where she's going to get $300 grand from the sale of this house, and dad's going to be knocking on the door saying, where's my cut.

And I want some. Yeah, that's— that should have been mine.

That should have been mine after all I've done for you. And now that stuff starts.

And so you got to go ahead and just nip it in the bud. Nip it, nip it, nip it.

I love what you say, Dave. If, if you need to have a hard conversation about your will, have the courage to do it while you're still alive.

Don't be a coward.

Yeah.

When I talk to people on The Ramsey Show, 90% of the problems I hear come down to one thing: not having a plan. They're not living on a budget. They have no idea where their money's going. Money is just happening to them instead of them happening to their money. And guys, that is so normal, but it doesn't have to be normal for you. And that's why I want you to go download our EveryDollar budget app. EveryDollar not only helps you tell your money where to go with a budget, it also builds a plan to free up extra money so you can pay debt off faster and start building wealth. And the best part, your plan is completely personalized to your life. It's the same advice that you would get if you called the show, and it's right in your pocket. So, don't keep living normal. Go download the EveryDollar app your app, answer a few questions, and get your plan today.

The Ramsey Show Question of the Day is brought to you by Why Refi. Defaulted private student loans don't fix themselves, but you you can fix them. Yrefy helps you refinance into a low fixed rate payment that fits your budget so you can get back on the Baby Steps and move forward. Go to yrefy.com/ramsey. That's the letter Y, R-E-F-Y, dot com slash Ramsey. Might not be in all states.

Today's question comes from Brittany in Rhode Island. Brittany writes, my in-laws are very wealthy, but they did not save a single dollar for their kids' college expenses, and they will leave them a large inheritance when they pass away. They've told my husband and his siblings to expect to each receive close to $4 million after they pass away. And my husband has over $40,000 in student loans. Should I be happy that my husband will receive an inheritance later in life instead of help— having help now? Or is it okay to be annoyed that this debt could have been avoided if they had planned for their college differently? All right, here's what I want you to do, Brittany. I want you to go outside in the garage and open the car door in the garage and put your hand in it and just slam the door repeatedly. 'Cause that's about as useful as you spending one second of thought or energy or feelings over this matter. It just is what it is, what it is. They made a decision that they wanted their kids to pay for their own college and they get to do that. And 'cause Dave, I guess she could be annoyed all she wants, but it's just a waste of time and energy and storage you're about to be cut, you're about, you're gonna get $4 million when they pass away.

Assuming you're still married.

Yeah, exactly, exactly. I don't know why anyone would spend a second of energy over this. His parents made a choice and they clearly have done well for themselves financially.

When you married your husband, you knew he had $40,000 in student loan debt and you knew his mom and dad, you just didn't know the numbers around it. Yeah. Paid off, it's over. So just love them where they are. Are. They're your husband's parents, and they're not— they don't do things the way you would do them. And welcome to in-laws. And, you know, yeah, no, it's not okay to be annoyed. Mind your own business.

Yeah, that's a good— mind your business.

Mind your own business. You can take care of you and your husband, and don't worry about what other people do. You spend all your time being annoyed about what somebody else should do. What if I had $4 million? This is what I would do. You don't have $4 million, so it's not a problem. Problem for you. And you don't get to, you don't get to make this choice. So you make choices on based on what you wanna do in your future.

Um, and you don't know Brittany, that his parents didn't have 3 friends whose parents paid for their college and they watched their buddies do a bunch of drugs and, and get kicked outta school. And they told themselves from a place of value, we want our kids to have skin in the game when they go to college. And your husband chose to take out student loans instead of cash own it. And so if you're gonna be mad at somebody, be mad at him about it. But you don't know why they made the decisions they made, and they're about to give y'all $4 million when they die. Relax.

Yeah, well, I don't even care if you get that or not.

Choose joy, man.

Yeah, I'm just— just— this is— work on, um, controlling people that you can control, which is you. And there's one of them. Yeah, it's the one in your mirror. Yeah, yeah. And just move on. Oh my gosh. No, I think you got mother-in-law trouble and you're trying to get her— give a logical reason why you're mad at your mother-in-law.

See, I think she's got— she's pissed off that they have to pay back this.

She's pissed off at her mother-in-law in general, and then this just gives her a reason to be. Yeah, that's— that's—

no, handle your business and get on with your life. Be grateful.

Go, let it go. Frozen. Just let it go.

Dave's favorite movie and soundtrack.

Glenn is in Anchorage, Alaska. Hey Glenn, what's up?

Hey, so I am self-employed and I have a variable income, so I was wondering how many years I should stay self-employed if I noticed with the economy that my income is not enough to save for retirement.

Well, the variable's not the problem. The problem is it's not enough. My income's variable, but I'm fine.

Yeah.

So the problem is not variable. The problem is you don't make enough, right?

Yes.

I mean, you have an occasional bonanza month, and then the rest of the month are just dry beans, and the total is still not enough to live on.

Enough to live on, but not to put away for retirement.

Well, that's living. You have to— you have to plan for retirement or you eat dog food. So I got a plan. I got a plan for retirement. That's part of living. So what do you make? What do you— if you're self-employed, so you file your taxes, what is the profit of the business that you pay taxes on each year?

Um, so Currently with the assets that I've, uh, assets are not profit.

What is the profit of the business that your tax return would show me if I opened it up?

Um, so taxes is showing a negative, but the, like, what goes in my banking account is— so last year was positive $13,000, the year before that.

Okay, the problem is you're living at the poverty level, sir. You need a job. Okay, you're not making enough money to eat on. That's the thing. So if your income taxes are showing negative, there's a reason. It's because you didn't make any money. And then what it amounts to is you got some depreciation or something that you're taking, and that allows you to cash flow $13K. But overall, your assets are going down probably more than $13K, or you wouldn't be getting that depreciation. So you're really not making a living. And if you can't see a way to triple that or quadruple that in the next 2 years, then you need to close the this and go get a position where somebody will pay you $40,000, $50,000, $60,000 a year, you're gonna feel rich if you had that happen. If you made a below-average income, you'd feel rich compared to what you're making now. So it's not the volatility, it's the lack of income overall. And that's the thing you do. So my friend Henry Cloud wrote a book called Necessary Endings. He said we end something— a job, a business, a relationship, a relationship, a whatever, we end something when we lose hope that it's going to get better in the future.

And so if you're married to an alcoholic who you lose hope that they're actually going to get healed, that they're actually going to get dry and sober, you lose hope, then you have to end that relationship. And because you can't continue to pour into the crazy world. In your case, you have to end this business because we've lost hope. For many years you've been doing this and for many years you've been starving to death doing it. And unless you really can tell me there's a reason that I'm going to make $40,000 and not $13,000, I'm going to make $50,000 and not $13,000, showing on my taxes that I really made that in real money— unless you see that, then you need to close this and get a job. And I think you probably need to close it and get a job. That's what it sounds like. It's tough to do though. Mark's in Greenville, South Carolina. Hey Mark, what's up?

Hey guys, thanks so much Thanks for taking the time to take my call. I've got a little bit of a question about income and kind of providing for my family for the future. Long story short, my wife and I are missionaries who have come off the field and we're transitioning back to the States. My wife is— we have 2 kids, 14 and 12. My wife is disabled and she's not really able to hold down a job consistently, but she's also unfortunately in the position where she doesn't qualify for disability. I just graduated from nursing school, so I did a 2-year program, and I'll be wondering— a new job here, and my, my take-home pay every month is right around $4,000. We're able to live because of the generosity of a local ministry here that provides housing to missionaries who are transitioning to and from the field, so it's low cost rent basically. Um, so that we're able to kind of live as I look forward to—

did you get an LPN and you passed your bars?

Uh, RN, it's a registered nurse.

Okay. So why are you making so little? That's an $80,000 to a $95,000 a year job and you're making $48,000.

Uh, well, it's about the highest offer I got, which is the highest, the hospital system that pays the most, um, is right about $70,000 a year. So I take home— to start, correct? Yeah. And I'm brand new.

That's not $4,000 a month, that's $7,000 a month minus taxes, right?

Right. What I— well, I only work 36 hours a week, um, so when you do the math of what it was like, $35 an hour, uh, times 36 hours a week, and then you factor in taxes, it's like $4,100 a month or something like that.

The ground— the The great news is, is you've entered a wonderful career, and if you'll keep pushing and growing your career, you're going to go up in income dramatically. You could be making $150,000 within the next 3 years, and in the meantime, you're going to end up renting for a little while and rebuilding your lives after the mission field, but you've got a good career field to win with. It's that time again, folks. Tax season is here. I know some of you would rather bury your head in the sand until April 15th than face your taxes, but here's a better idea. If your tax situation is complicated, get in touch with a Ramsey Trusted Tax Pro today. That way they can take the stress off your shoulders once those tax forms come in and teach you how to keep your tax bill as low as possible. But don't wait. Ramsey Trusted Pros can book up fast. Go to ramseysolutions.com/taxpro to find one who serves your area with excellence. That's ramseysolutions.com/taxpro. Your personal and professional growth can hinge on this one thing as much as anything else. The one thing is communication skills. And the good news is that's a skill you can develop.

That's why I'm excited about this new book that I've done called Stop Talking, Start Communicating. It's now available for pre-order. Preorder, and it's paired with the DiSC assessment. So it uses your results on the DiSC assessment to help you adapt your communication style so you can build trust and connection and influence. If you think about how other people are thinking, it helps you communicate directly to them. I took this DiSC 40-something years ago the first time, and I took it home. I told Sharon, I said, "Look at this thing. It's absolutely amazing." It's like she read it and she's like, "Yeah, that's what's wrong with you." And I went, "No, that is me." And we use it here at the office when we're hiring people. And we can walk up to someone's office and there's a DISC assessment, their DISC profiles on their wall right before you walk in, so you know who you're talking to. So pre-order today, $34.99, and you get $30 worth of pre-order items, which includes an extra assessment, which is good for the spouse or friend and that kind of thing. So check it out, RamseySolutions.com/store. Stop talking, start communicating.

Scott is in Atlanta. Hey, Scott. How are you?

Great. How are you, Dave?

Better than I deserve. What's up? I see on my screen you're a Baby Steps millionaire, man. What's your net worth?

Uh, $4.3 million.

Way to go, man. Give me a little breakdown on that. How's that break out category-wise?

So $2.7 million is retirement, um, which is, uh, 401(k)s, mutual funds, and Roths. 7.25 is a house, and then 9.18 in other mutual funds and some common stock.

Cool. How old are you?

66.

66. And how much of this $4.3 million did you inherit?

My wife and I each got around $20,000 when our parents passed away.

Were you already millionaires when you got that?

Oh yeah. Yeah.

Okay, all right, cool. So you're not millionaires because of inheritance? Not even close. Yeah. So what was your career?

I was a salesperson.

What about your wife?

She's a dental— a retired dental hygienist. We're both retired, but she's a dental hygienist.

Gotcha. Okay, you have a 4-year degree? I do.

I have a master's.

Okay, in what? Business?

Yeah, MBA.

An MBA. Okay, what was your GPA?

GPA? Well, in undergraduate it was not stellar, I'll admit to that. Um, but in graduate school it was 3.35.

Okay, 3.35. All right, cool. All right, so you're smart but not a genius. Okay.

No, you had fun when you were 19 like you're supposed to.

Good for you. Good for you, man.

Yeah.

So, uh, do you think that if— so you're 66, you're my age, I'm 65. Um, if someone's out there that's 25 and they're listening, do you think they can still become a millionaire starting from nothing like you did today?

You bet. You know, it's, it's pay yourself first, stay employed, stay invested.

Okay. Cause you got over half, about 60-something percent of your net worth is in your retirement account.

Yes.

You're worth $4 million. Your house is $725,000. Yeah. It's not $7.2 million house. It's $725,000 house in Atlanta, Georgia.

Well, I live in North Georgia, but yeah. Yeah. And so, yeah.

So you have a nice home, but it is not a mansion.

No. And that, that when we built this house, we built during COVID had no intentions of having that kind of house. It just, it turned into it because of rampant building costs for that 2-year period when we were building.

Yeah, yeah, okay. But the house is worth that now, easy. It's worth $7.25 million now, right? It is.

Yeah. Oh yeah.

Yeah. All right, good, good for you. Well done, well done. Okay, so what advice would you have for your 25-year-old self? You said that live on, stay, stay employed and keep investing, I heard. Think I heard.

Yeah, stay employed, pay yourself first. First, um, get some term, you know, good term insurance.

What do you drive? What do you drive?

Well, I just bought a brand new truck.

What'd you buy?

I bought a GMC Denali.

Oh, that's nice.

Yeah, we got our wife, uh, all right, we gotta— we got her, uh, um, Honda Pilot.

Okay, very good, very cool. All right, so a GMC Denali and a Honda Pilot. And you're worth $4 million. Good. Not a Lamborghini?

No, no, I've got a real— I've got a real fancy boat. It's a John boat.

There we go. It's my favorite kind of boat. All right, hey Scott, let me ask you this. You've been a salesman— have you been a salesman your whole career?

More or less. I started it while I was in the Army, you know, out of college. I went in the Army.

Okay.

I made a and $12,000 a year, right, at that time. You know, again, that was—

what's the most you ever made in your life in a year?

Uh, family, $200,000.

Okay.

So when you're a first starting out salesman, you've got real good months and real tough months. How did you have the discipline, or what mindset did you have to keep investing during those times? Because those would be times that I'd be tempted, especially when I'm younger trying to support a family, that I'm going to hold off. I got an up and down down income, I'm going to hold off on the investing. I might put some in savings when I have a really good month. But you, you started investing early.

Yeah, I was— I ran, believe it or not, um, as a young lieutenant, um, a Templeton salesperson showed up at the, at the, in my quarters and sold me some life insurance, some term life insurance that I'd never heard of. And, um, a mutual fund. And I was like, well, I don't plan. I don't have any kids. I'm not married, but if something happens and I'm in the military, I'll give my parents something. And that sort of started the whole process, the concept of monthly investments. And over the 40 years, it's been— I've been through— we, Dave and I, have been through a lot downturns in the market and you just don't panic. Stay in.

Absolutely.

I love it, man. Congratulations.

Congratulations, Scott. You're a Baby Steps millionaire and icon. You give inspiration to everybody out there listening that this still can be done. The great American dream is not dead. Stay off of TikTok, you know, and keep investing and keep employed. Keep investing and keep employed. I think you said that like 4 times He'll just keep working and keep investing and keep working. And then you'll look up and you can do anything you want to do because you understand his income is off of these investments is $400,000 a year. And his highest income he ever made was $200,000.

And to all the regular people, not the TikTok people, the regular people listening, I want y'all to hear at 4 point, what, 4.2, $4.2, $4.3 million, a paid for house, house, retired. They went to buy their fancy car and his wife got a Honda Pilot, right? Like, it's like you said, it's not this fancy BMWs, and those aren't bad or wrong or anything, but there is a sense of that's a family that has— is at peace with where they are and what they are.

Yeah, they want something reliable. And I guarantee you she got a Honda Pilot because it's grandma car.

It's gonna be— yeah, it's gonna be the car they drive for the rest of her life.

Put the grandkids in it, a lot of room.

Yeah, one of those grandkids is going to take that car one day, probably.

Probably.

Probably that Denali will be on the side of the road by the end of the weekend.

But just—

I'm just kidding. I just need to make a GMC joke there.

Yeah, it didn't work.

No, it's a great joke. It's a great truck.

Yeah. So folks, the bottom line, the reason we bring the Baby Steps Millionaires on here all the time is because 89% of America's millionaires— that's 9 out of 10— are millionaires not because of inheritance. 79% received 0. 5% received a small amount, like $5,000 or $10,000. Another 5% received a substantial amount, but after they were already millionaires. And in his case, in Scott's case, he received a small amount after he was already a millionaire. So he did get an inheritance, but 79, 5%, and 5% is 89. That's 9 out of 10 millionaires are not millionaires because of inheritance. Inheritance. That's data. And if you don't agree with that fact, you're what's known as wrong. So quit telling people that they can't do this. Compound interest and self-discipline and living on less than you make and living on a budget and being in agreement with your spouse actually freaking works. Hey guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now you can get that same kind of help anytime with Ask Ramsey. Ask your money question and get answers built on Ramsey principles we use on the show.

Whether you're making a decision or just want something explained, Ask Ramsey is here to help. It's fast, simple, and free to use. Go to ramsesolutions.com and try Ask Ramsey today. That's RamseySolutions.com. Our scripture of the day, Philippians 4:19, my God will meet all your needs according to his glorious riches in Christ Jesus. Our friend Art Laffer says, I never heard of a poor person spending himself into prosperity, let alone I've never heard of a poor person taxing himself into prosperity. There we go. Christopher is with us in Seattle. Hi Christopher, how are you?

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

Better than we deserve. What's up?

Hey, so, um, my wife and I, our total household income is $201,000. And I am going to be running for a representative position in my district. And it does come with a $34,000 pay cut since I would be quitting my job, my current career. And so financially, I know that we can do it. We're nearing the end of Baby Step 3. And my wife agrees that I should get involved locally in our political realm here. And I'm just struggling doing, uh, with the mindset of the fact that we are losing, uh, $34,000 and it feels like I'm in a way letting down, uh, myself and my family. So I'm just trying to figure out how to cope with that.

Hmm.

Are you running for a representative seat because you want to see change? And you want to be that change and you want to get involved in your local community? Are you doing this to just because you hate working?

No, I absolutely love my job, but I do want to be a part of the change and to help motivate others and tell and let everybody know that it takes all of us to create this change.

Let me ask you, I'm sorry, you're a representative of what level, the state level?

State level?

Yes.

Okay. Most state representatives have a full-time job.

Oh, I was unaware of that.

Almost everyone— if all the ones I know personally have full-time jobs, I, I don't—

they don't make much money and they have to. Now, I don't know if that's true in the state of Washington or not. Yeah, but, um, you might want to investigate that. I'm not sure that a state representative is a full-time job.

Okay, I could definitely do that research then.

I'm not sure. I mean, I know in our state, I know most of the representatives, and a lot of them in our state, I know a whole bunch of them in our immediate area certainly, and all of them have jobs. They have to because they don't make much, um, at the state level.

Christopher, you said you— does your wife make $170,000 and you make $35,000?

Uh, no, um, I make $101,000 and she make, uh, $100,000 pretty much.

Okay, so each of you make about $100,000, but you're going to drop down to $65,000 if you take this role?

Yes.

Okay. All right.

So I, I like the idea of bringing back— just call me old-fashioned— public service being a service. It's when I'm going to— I, I, at, at net loss to myself, I'm going to be in service to my community. And you've got your wife's support and backing.

I mean, I think you have $165,000 household income.

Yeah, nobody, nobody's starving. I think this is a noble thing.

Choice you made. Yeah, and nobody thrust it upon you. You don't have to do it. So there's no reason to have to cope with it emotionally. If you, if it was like if you got demoted and you lost, and you went from $100,000 to $65,000, you might have to emotionally cope with that loss.

Or if your wife was a stay-at-home wife with 3 kids and and this was going to put y'all— y'all couldn't pay your bills, then you'd have a hard decision to make.

You have $165,000 income net-net. I don't know that there's anything to cope with.

I would spend zero seconds coping and all of my energy on being the best public servant I could be and figuring out if this really is a full-time job.

Yeah, that's the other thing. And I don't know what that means to your current career, um, and those sorts of things.

Let me say it this way: if your identity is in a number you bring home versus value you provide to other people and in your relationships you have an issue whether you're— like, you already have that issue. If you're— if your identity is, I make as much money as my wife, or I make this many dollars, I make this magic number called six figures, and somehow that makes me better or able to like myself more, you're gonna have bigger issues across the board, brother.

Yeah, yeah, that's true. Yeah, but I don't— I don't think that's what's going on. It was more like— it was because he's really reaching to do something here that's awesome. Yeah, yeah, that's a noble call.

Yeah, but if it clashes with this idea that I also have to make this much money or I'm not a good husband or a good man, I think that's—

that's true.

Lean into the service, man.

That's fair. Josh is in Nashville. Hey Josh, how are you?

Hey Dave, I'm doing great. How are you doing?

Better than I deserve. What's up?

Yeah, I was hoping you'd say that. Um, yeah, hey, I, uh, um, recently moved to the Nashville area. I'm from Southern California like so many people here. I've met. And, um, yeah, right when I moved here, I was sort of caught off guard, um, by my business partner saying, hey, we should sell the business. And so something I wasn't really prepared for mentally or financially. Um, so that's something I'm kind of working through right now. Um, in addition to that, I'm also in the process of selling a bunch of our real estate. So most of our wealth right now is in real estate, just to free up more cash. And I'm, I'm not sure I can do this, but I, I'm trying to understand if I can create the option to be work optional based on our assets. So just calling to see.

So what will you get out of all the real estate and out of the sale of the business? What's the big number?

Yeah, so the business should net me about $1.5 million, and then the real estate another $2 million, and then I have— so $3.5 And then I have about $500,000 in taxable brokerage. And then one other potential source of liquidity could be our house. We have about a $2.3 million house with a $700,000 note on it, um, so we could go downsize there as well.

No, you could just pay off the note, either one. All right, so you got like $3 million to work with, give or take, depending on what we do with the house and the note. All right, uh, or $4 million, you know. So, um, you know, if you invest that in good growth stock mutual funds, the S&P 500 has averaged 11.8% since it began. That's the stock market average, in other words. And so if you pulled off 10% off of $4 million, you'd have $400 grand. If you pulled off 8%, you know, you'd have $320,000. What do you need to live?

Yeah, yeah, right now not, not a whole lot. Maybe like $10,000 $10,000, uh, not quite $10,000, maybe $8,000 per month.

Okay, so $120,000 a year, which is like your money still growing if it's invested in mutual funds and doing nothing but sitting there. That's if you don't do anything else with business and you don't do anything else with real estate. Yeah. How old are you?

Part of my question. I'm 44.

Yeah, well, you need to do something.

Yeah, yeah, no, I understand that.

It's not fun. Life's not fun. I mean, you're not gonna have fun if you don't do something. You've been doing things your whole life. Now, do you have to be stressed out and desperate? No. But I mean, you're an entrepreneur, you've grown businesses, you've built wealth. It's going to take you about 13 seconds to be bored.

I appreciate you saying that. Yeah. One of the things that's kind of playing around in my head is, am I employable? Like, what could that look like to get a job? I haven't had a job since I was 24.

I wouldn't. Last thing I would do, you know, I would just do consulting work for somebody, if you know, show somebody how to do what you know how to do. Or I'd go build a business of some kind, buy some— buy a business, start a business, or I'd buy some other real estate. But you need to put your hand to something, you know, otherwise you're just gonna get fat and go fishing, and that's not a good plan. And so you're not gonna be— you're not gonna like yourself. So I just— you've been doing too much. Now again, you don't have to do 70 hours a week, 80 hours a week, but you don't need to be a Walmart greeter, dude. I mean, that's not— it's not the stage— that's not who you are. And so don't do that. Don't set yourself up for that. But yeah, that's fine. Yes, you are work optional, but in terms of the actual arithmetic, but not your spirit. Spirit is not work optional. I don't find retirement in the Bible.

No, I, I, I often tell folks who are older than you by a decade or two who are retiring, who are looking for, I don't know what to do next, go spend 2 or 3 months at a local charity just showing up every day and serving people. And if you have the entrepreneurial mind now that you've had for the last 15, 20 years, you will spin up 15,000 ideas on people you can help and people you can love and businesses that will work to support those folks. And so, yep, that's what I would do. Yep, there's all kinds of things you can do, but you got to have a purpose.

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