Transcript of There Is Hope When Debt and Life Feel Overwhelming

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Normal is broke and common sense is weird. 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 George Campbell, joined by best-selling author Dr. John Deloney, and we're taking your calls at 888-828. Com. Jeff is going to kick us off in Jacksonville, Florida. What's going on, Jeff?

How are you all?

What can we help you with today? What's happening?

Well, my wife, over the last 8 to 10 years, has taken on a series of, I guess the term is predatory loans, now totaling right around $300,000, all without my knowledge, of course.

Goodness gracious. Yes. When you say predatory loans, what type of loans are these exactly? You broke up on us, Jeff.

I'm sorry. It's the ones where they send you a check in the mail and they say, Cash this, and you fill out some paperwork online, and they deposit the money straight into your account.

Okay. I'm trying to figure out the actual... Was this one company that she just kept falling for this over and over?

No, it was multiple.

Wow. They basically say, Cash this check, a. K. A, it's a loan as soon as you cash it.

Correct. It says you're pre-qualified for X number of dollars.

What did she use the money for?

She blew it. There's nothing to show for it.

But you're telling me for a decade, you had no inkling that this was happening?

That is correct.

That's the most shocking part of all of this.

It is.

Wow. What did she say she spent it on? When she said she blew it, was there an addiction involved here?

No, just blew it. Amazon. Who knows?

I mean, I- You never thought, Hey, where's she getting all this stuff? Because I know what's coming out of our account. I'm guessing there is no our account. Is it your money and her money?

Well, it is, yes.

It's always been that way?

No, it wasn't when we were first married. We separated for a few months back in the 2010 time frame. And of course, I obviously separated our finances. And then when we reconciled, we just never really got around to it. Everything was fine until she retired this past January. Everything was fine until she retired, obviously took a pay cut and didn't have the money.

Feels like a bad time to retire when you're $300,000 in debt.

That is correct.

Do you guys have other debts?

No. Well, our house.

Okay. And what's your household income?

About $125.

And that's just you?

No, no. That's her retirement and me.

Okay. You're willing to go, Hey, this is us. She made the mess, but it's our mess to clean up.

I don't know that I have a choice at this point.

For me, you've always got a choice.

Yeah, but that's not a choice I'm willing to make.

All right, there we go. That's what I was hoping. I was hoping for some ownership there, not some victim, but some owner. I love that.

No.

I love what you said.

Yeah, I definitely take part of the responsibility, but no, I would never leave her over something like that.

Is she committed to not playing this game anymore?

She is. We're in the process of recombining finances. That way, if something like that were to happen again, I would know about it.

I'm going to pass this to George to I'll let him walk you through just the process. But if I were you, I don't know the help I get from leading with these were predatory loans. They were, they are. But I think it helps. It takes the edge off, my wife did a thing repeatedly and hid it from me for a decade. We need to deal with that part of this. Then together, we're going to heal both the trust in our marriage and be, like you said, we're going to do some things very tangibly. We're going to combine income. We're going to be very diligent on a budget. We're going to tackle this debt together. She retired. She's going to have to go back and get a job because you all are 300 plus in the hole now, plus all the interest it's wrecked upon this madness. We're going to tackle this problem together. But I would... Yes, there's bad people out in the world. Yes, they took advantage. But also this is a daily practice that happened over a daily deception that happened over a decade. Blaming it in any shape, form, or fashion on the lenders right now is just a distraction from the problem that you all two have together.

You get what I'm saying?

I agree 100%. I just didn't know a better term.

No, you're right. I hate it. I wish it was outlawed.

It's a predatory practice. But when you get bit by the snake once, then you go back for eight more bites, at some point you got to go, I guess I was a part of that.

Then you hide the bites from the person that you're supposed to be doing life side by side with. That, to me, is the bigger issue than these deceptive people.

How much does she have in retirement?

Well, she drives Social Security, and she's got a pension that I don't know exactly what's in her pension. Between the two, she brings in roughly between 70 and 75,000 a year.

Okay. How much of that do you guys actually need to cover your bills? Do you guys have any margin right now?

Oh, yeah. We've got a house payment. That's it.

What's the house payment? How much?

Twenty-seven.

Then what's your total take home pay for the month between the two of you?

About, it's roughly $4,500.

Okay. That doesn't leave a whole lot of wiggle room after insurance, taxes, utilities, food.

It That is not.

But here's the napkin math. If you can put 50 grand a year towards these loans, they're done in six years.

Correct.

I don't know that you could scrape together. We're talking over four grand a month needs to be going towards these loans. Otherwise, the interest The loan is going to keep ballooning the balance to where you'll never make progress. You've got to get angry at these things.

Right. But what I've actually done is I've contacted each lender individually and I've negotiated with them. Hopefully, I'm going to be down in 150 to 170 neighborhood is what I've been able to negotiate so far.

Are they requiring lump sums for each of those?

And that's the hitch, is that I would have to pay a lump sum?

Do you have any money you could use?

I don't have that money. Well, I do. I do have that in my retirement fund. And how old are you? In mutual fund. I'm 57.

Okay, so we're not going to touch those. This might be, Hey, in three years, when I have access to retirement, if you have the funds, then we write the checks.

I was considering taking a second mortgage on my house. No.

Jeff, then you're just adding to the mess. Now you're really putting your house on the block. Going further into debt is not the solution to get out of debt. I would not do that. I would go for that settlement that you've been already going after and then do everything you can. She's You're going to have to work for the foreseeable future. You're going to have to work for the foreseeable future to clean this mess up. Wish you the best.

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Andy is in New York City up next. Andy, welcome to The Ramsey Show.

Hey, guys.

Hey, how can we help?

Hi, I've been trying to talk to my wife about some stuff, about trying to help out around the house, getting a job. But it seems like every time I bring something up and how I need her to contribute to the family, she tells me that I'm starting when I'm honestly not. She tells me what I should be doing. Then she just turns around and just runs away from everything. We've been married for about four years, She came from an abusive childhood. I bring home 35 a year, but after child support, it's about 27. I have $420 car payment It's just been me, and I'm really struggling. I didn't know if you guys could help out.

It sounds like you're asking two different questions. One is a question about your money. What you bring home, the payments you have built into your life, that's a scary way to live. You live in a very expensive part of the country, right? That's a lot. And doing this alone, and it sounds like you're telling your wife, Hey, here's what I want, here's what we need. And she's like, Yeah, I don't care. That's got to be super frustrating and lonely and maddening and all those things all in one, right? But it sounds like you got two different challenges here. Where would you like us to focus?

On us.

Yeah.

So when you say she doesn't help out around the house, she's not working, how does she spend her day currently?

Sitting, playing games.

How old is she?

She's 32.

Do you guys have any children together?

No.

Okay. So it's not like she's staying home with the kids. You're saying she's literally just playing video games all day. You go to work, you come home, you're doing all the house chores, the cooking, the cleaning.

Yeah, she cooks for the most part, but I have to do all the cleaning and everything else, pretty much.

And you feel like she's not pulling her weight in this marriage? Yeah. Has it ever been different, or has this been the case since day one?

No, it was different back when we first started.

What shifted?

And then it's just gone downhill.

Is something happen in her life? I'm guessing there's some anxiety, depression behind all of this. Yeah, I have no- Have you dug into that? Have you approached it from a place of empathy, of Hey, what's going on? I feel like you've been real down lately and just vaginal playing games, and there's this disconnection. Tell me about that. Versus, I need you to help out around the house and go get a job. It sounds like you're her instead of a spouse?

No, I've tried it, and it's just, Oh, you're starting. You're starting. You're starting when I'm just trying to have an honest general conversation about helping out.

Has she sought Can she come out help, professionally?

Yes. She sees a counselor once a week.

Would she be willing to invite you, or would she be willing to have you come with her?

That could be an option.

Here's the way I approach that. This is you submitting. This is you taking a knee, and there's going to be people in the internet sphere that think this is bad and this is weak. It's not. It's loving. It's connecting. This is someone who's clearly hurting and who's not experiencing the world in a real way. Because you have a big math problem, you have a marriage problem, you have a life, joy, and passion problem. You've got all the problems. She's clearly not experiencing the world as it is, but she is experiencing the world as she feels it to be. If you approached her and said, I don't feel like I'm doing a good job connecting with you and loving you in a way that you can feel it, I'd love to come to one of your counseling sessions so your counselor could give me some insights on how I could be a better support system for you. That might be an invitation that she would extend to you. You could come to her session and from there, maybe get context on what she's telling this counselor, what the counselor is telling her, what world you're inhabiting.

Because here's the deal. You need to come up with on your own an or what statement. What I mean by that is Are you going to leave? Because if the answer is no, if the answer is till death do us part, I said I'll be here, then your energy is spent complaining, your energy spent yelling, your energy spent fighting is wasted I'm not going to leave. All of my energy is going to be towards finding some avenue, some shape, form, or fashion, some way that I can connect or deal with the reality that I've got a partner who's just going to scroll her life away, and we have a math problem, and I'm going to have to go get a different job or two jobs or three jobs. Or what statement is, If this doesn't change, I'm going to choose to go elsewhere. You need to be open and bold and put that on the table. But you just continually fighting without an anchor point, it's not getting you all anywhere, right? In fact, it's making everything worse.

Yeah.

And now you're in a place where you can't even say, Hi, I love you, because then she goes, Well, you're starting up again, and then it's over.

Yeah.

If she was to call into this show, what would she tell us about you, how she experiences you?

How much I care about her and how much I try and do everything for her. She'll say that, too, but she'll just have her moments where where I just try and have a general honest conversation.

Yeah, it sounds like she's struggling with something bigger than just connectivity issues. And so, yeah, if there's a possibility that she would allow you to join her in a counseling session, or two or three, I think that would be really beneficial for everybody. Okay. Let's talk about your money for a second. George?

Yeah. How much debt do you currently have? What's the total balance of your consumer debt?

My consumer debt, back in 2000, In 2021, we filed for bankruptcy because I had to.

Why did you have to?

I was knee deep in the swamp. I couldn't keep up with any payments. I had a broken scaphoid at the time. Everybody was going to take me to court.

So did they wipe it clean or did you get put on a payment plan?

No, they wiped it And where are you today? Now, today, I had a car that broke down.

So you had to get a payment?

So I went and got a car payment. Yup. Even though I told my wife that I didn't want to.

So she forced you. None of this has happened on your own volition is what I'm hearing. Everybody forced you into every decision you made that put you in this terrible place.

No, I went out No. I went out and got the car payment, even though I didn't want to. That's what I was telling my wife. So we went out and got the car payment, and then she also goes to school for nursing.

You left that part out. I thought she was at home all day playing video games.

She is for the most part.

Except when she's going to become a medical professional?

What was that?

Except when she's going to university to become a medical professional?

Even classes are at home some days, but yes.

Okay. What is the total balance today?

Today, it's about 90,000.

Goodness gracious.

Yup.

And you make 30 grand a year?

Yup. And I make 30 grand a year.

Why do you make 30 grand a year?

Because I can't find a better job that fits my schedule that I need.

What's the schedule that you need? What does that mean?

So I have a daughter who lives about an hour and a half away from me that I have to go see. Every Tuesdays, that I pick up about five o'clock.

I think we need to readjust the schedule to go, Hey, based on my work schedule, I can't make this happen. You're not going to be able to afford child support at this point. So you need to make some serious changes, Andy. I mean, all the way around. And yes, there's other people involved, but all I've heard so far is I had to, I have to, I had no choice. She made me. I think we just need to control what we can control, and that's the guy in the mirror, and then we can work on the stuff around it. I wish you the best.

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Alicia is in Chicago up next. Alicia, what's going on?

Hi. So basically, long story short, I had a manic episode and put myself into a little bit of debt, and I want to know where to start with the baby steps to get myself out of the situation I put myself into.

Very cool. When you say a manic episode, are you diagnosed bipolar?

Yes, I am.

Okay, one or two?

I believe it is two. It's the genetic one.

Okay, different conversation. Have you had manic episodes before?

Yes, I have, but they were not as extreme as this one.

Tell me about it.

Basically, I was having a lot of family trouble, and then I had health problems, too. I also have endometriosis, so I had a flare up and had to have emergency surgery. It was just a complication of everything altogether that I think what made it a It was a really bad episode for me.

Tell me about the payday loans you took out. How bad is it?

The original total amount was like 2,300 and something. With all that interest, it is approximately $5,800 with all that interest.

Gosh, I don't know how those people sleep, to be honest with you. I just don't.

I'm not very happy about it.

I know. Okay, so question number one is, are you I've seen friends, I've seen colleagues, I've seen countless students of mine over the years who are diagnosed with bipolar disorder, and you know it's on a spectrum, various levels of it, who when they commit to med management, when they actually take their meds, and when they feel great, and when they don't feel great, and when they put in some, what I would call, for lack of a better term, some hurdles, when I feel myself beginning to start down on a path where I'm going down to the basement or when I'm starting on a path where I'm about to go to the mountaintop, I know I'm going to give my debit card to a trusted friend. I am going to turn my internet off for seven days. They put some really big hurdles to protect themselves from themselves in those seasons. Are you taking care of your medications? Are you seeing a professional? Are you managing this thing in a healthy way?

Yes. We were in the I'm in the process of figuring out what dose worked for me last year, like what medications, and that's when I had the episode. So it wasn't the correct medication. Now, I'm actually on the correct one. So I don't know if it's okay for me to disclose the type.

Well, it doesn't matter for this conversation, but I just want to tell you I'm proud of you.

Thank you.

No, I- And I want you to commit to me and George and everyone listening, you're going to stay on the plan, okay? Okay. And that's awesome. Now, when it comes to getting this paid off, George will walk you through it. It's a math problem, but we fully believe you can get there. And you don't believe in yourself. We probably believe in you more than you do right now, but hear us say, We believe in you. Okay. Same team?

Same team.

Awesome. I'm really glad that you called.

Give me some more details about your financial picture. Are you working full-time right now?

No. I'm actually going back to school for human resource management and business management because I want to get a better career. Right now, I'm really just working as a waitress, so my income isn't like, what's the proper term I'm looking for? It's not like a set in stone thing. It's always floppy and it's really typical.

So you're working part-time as a waitress and then part-time school?

Yeah.

Okay. What other debts do you have right now?

I have a student loan debt that is only 3,000, but that's on deferment right now because I'm in school. Okay. And then Then there's one dental debt that I'm still paying back because I had to get my teeth fixed. Then the last one was a previous collection from a credit card when I was really young that I decided to open in me. Anyway, it's getting taken care of.

Have you ever been debt-free in your adult life?

I guess technically not, because I opened my first credit card at 18. It was a student credit card.

Didn't we all? I want you to just picture Alicia for first time in her adult life, completely debt-free with savings in the bank to cover any emergency that would come up. How good would that feel?

Oh, it would feel really great.

It's a thing you don't have right now, which is peace.

Yeah.

Right. And trust in When I'm having a good day, I'm having a bad day, I'm having a really wild week or really low week, I'm okay. It's a magic feeling for somebody in your situation. It's a magic feeling for all of us, but especially for somebody whose inner world can be as volatile as yours is, right?

Yeah.

Yeah, it's beautiful. Do you have any money in your checking account or savings account right now?

In my savings, I only have like 10 bucks right now, unfortunately. I do have 200 I'm in cash savings, but that I was saving for emergencies for my pet if something happens with her. Okay.

Well, let me walk you to the baby steps, because this is the framework that will help you actually have a very tactical plan instead of just trying to do a few good things at once. And so baby step one is get $1,000 saved. So you have 200 now. That's awesome. We're on the path to getting $1,000. So right now, can you make minimum payments on your debts while working part-time, or do we need to up the income?

If I do minimum payments and everything, it is doable with the income right now.

Okay. Now, minimum payments on that payday loan, that balance grew since we've been on the phone. Yeah. That's the scary part. I want you to get angry at this thing. That might mean we need to take a semester off and go really hard and work 50 hours a week to at least knock out the payday loan. Okay. What's the trajectory for this program that you're in? How much longer and how much money?

Luckily, financial aid covers everything, and I've been doing scholarships, so I haven't had to pay for a penny for school, luckily. Great.

How much longer do you have?

I believe it is two years.

Here's the bad news. As long as I don't have- Here's the bad news. We can't go two more years working part-time as a waitress and make any financial progress. Would you agree?

Probably, yeah.

And so we need to figure out a different path. Maybe it's a pause, maybe you do less school right now, less credits, and it takes you longer. But you could go work full-time and clean this up, get some money in savings, and then go back to school with a whole lot more peace. Because right now, it's probably hard to focus on your school work when you see that interest accruing on that loan.

Yeah, definitely.

So once you I got a thousand bucks saved, which I hope happen, what do you make in a week?

So just to average it out, probably like 300. There are some weeks where I can get up to like 500, 700. But it's not always guaranteed.

So you're living off of like 12 $100 a month?

Yes.

Are you able to do that without going further into debt right now?

Yes. So luckily, it's because of my low income. I have food stamps and I'm able to get food and everything. My living situation is basically just pay what you can so I have no rent. So far it's actually been really doable, and I have a really cheap phone plan where it's only $25 a month.

Wow. Well, I don't want you to stay there. This is not like, Well, I can make it all work. You're in survival mode. This is literal poverty. That's the exact target demo these payday lenders go after because they're the most vulnerable, the most desperate. This is going to take a lot of work, work. And that might mean we get two waitress jobs, and we ratchet down on school, ramp up on income, just for even a season so that we can get her head above the water.

Okay.

Because once you have that $1,000 saved, Now we can start tackling these debts and just list them out from smallest to largest. So today, this is going to really help you get it out of your brain, put them all the debts on paper and put the balances and list them in order from the smallest balance to the largest balance. So your next goal after getting $1,000 is throw as much as you can on that smallest debt.

Okay.

That might be the dental debt. I don't know. And maybe, I'm guessing your credit is shot at this point. No one's going to go give you a personal loan, correct?

Yeah, no. I know my score It's like 6: 25, but I don't think anybody's going to give me a loan or anything. Yeah.

I was trying to get you out of this payday loan cycle because if this is going to be another year before you can attack this payday loan, the balance is going to be 10 grand. Yeah, that is pretty scary. We have to stop the bleeding. And if that means the dream of the HR job is on pause, I'm okay with that because I don't want you to look up. And now it feels hopeless because this loan just keeps doubling and doubling because it's three or 400 % APR. I'm so sorry you're going through this, Alicia. Hang on the line. We're going to hook you up with our budgeting app, EveryDollar, to help you make a plan for every one of those dollars coming in. And hopefully, you'll see some light at the end of this tunnel soon.

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Thank you.

How can John and I help?

So this year, my husband and I would like to start saving for retirement, but in our budget, we only have about 500 a month to put towards that. So my question is, is it better for us to open one Roth IRA and put the full 500 in each month, or for each of us to get one and split it in half, or if that makes a difference at all.

Well, as far as growth goes, it'll be the exact same.

Okay.

Now, are you guys in a financial place to invest? Do you have any debt right now outside of a mortgage?

No, we don't have debt. We have a emergency fund. And the reason our budget is lower for retirement is we're trying to save for a house this year. So we're pretty much putting everything we can towards saving for down payment and closing costs and all that.

Got it. So you're in what we would call Baby Sip 3B, where you can split the difference here. You can choose your own adventure and invest anywhere from zero to 15 % while saving up for that down payment. So how long is the down payment going to take?

We're hoping to We can do it in the next 12 months.

Awesome. And so after that 12 months is over, you guys get into a home, would you then ramp that up to 15 % of your household income? Could you?

We live in a pretty expensive place. So I don't know if we could do the full 15 %, but I think we would like to increase it over time as we can.

Okay. How expensive are we talking? Because when you say we're going to save up a down payment, we're going to buy a home, how much is this more What is your target going to be in comparison to your take home pay?

So for the area we live in, pretty much the cheapest houses we can get is between 400 and 450 That's our goal.

Okay.

And my husband, a lot of his work is commissioned, but the goal would be to make about 150 this year before taxes.

Okay. Are you working outside the home as well?

I'm just bringing in between like 500 and 1500 a month.

Okay. So let's add another 10 or 12 to that. 150? Yeah. Okay. So here's... The good news is you guys have a great income, and I hope you're able to get that house within 12 months. My fear is that if it's too tight to invest 15 %, it's always going to feel too tight. And that's going to leave you guys with probably needing to work later in life in order to catch up on retirement. So that's something I would consider. You can plug some numbers into an investment calculator to get a better picture of what that's going to look like. But you guys are young, you got time, just make it a goal to get to that 15 % mark. And that might mean we need to cut other expenses. That might mean we can't afford to live in the area we wanted to. It might mean you need to be working part-time or full-time in order to make the numbers work. And so whatever you guys do, make peace with that decision, and hopefully you'll get to that baby step four mark in no time. Silas is in Des Moines up next. What's going on, Silas?

Hey, I appreciate you guys taking my call. It was actually your book, George, that got me to take financial situations a lot more seriously, so I appreciate that.

Awesome. Love to hear it, man. So what's serious now? What did you get serious about?

Well, me and my wife have been trying to be better about budgeting. I haven't had the best time with that. But recently, we found out that we have some settling going on underneath our house, and our foundation is dropping a little bit. And we've only got a couple of quotes on it so far. The first one was 12,000, the second one was 24,000. And we don't have that money, and Just not sure what the best way is to handle this, knowing that it could get worse, but not knowing how fast it could get worse.

How much money do you have saved?

A thousand dollars.

Okay. And you still have some debt to pay off?

Yeah, we've got just a little over $9,000 a day.

Okay. And what's your household income?

60,000, to take.

Is that both of you working? No, just me. Just you. Okay. Is she home with the kids?

Yeah, she's home with our son.

Okay. So I imagine money's already tight as it stands, let alone thinking about- Yeah, that's pretty tight. Because if you need to solve this problem within six months, let's say, well, you need to save two grand for six months straight to get twelve grand to make the repair. You tracking with me? Yeah. And that feels like it's going to be a lot from your take home pay. So this might be a season where we say, Hey, we're going to pause the baby steps if this is a really urgent matter. And within six months, we need to scrape together twelve grand.

Okay. Yeah, we've been spending today was the first day we've been trying to find extra work. I'm trying to find extra work. She applied at a place, and so we're trying to find that. I just don't know. Because the other issue I have is I'm not certain if we can afford the house even without the issues.

Oh, wow. Like a mortgage itself?

Yeah, because our mortgage payment with escrow is like 1400, and I bring home about three grand a month. You bring them three grand? I'm already concerned about that. But I don't know if she's as concerned about that.

How do you make 60, but you take home 36 grand?

Sixty is something with bonuses. I get a couple of bonuses a year. Okay. And then in the past, I've had a lot more overtime work, not as much this last year.

I think we're going to need some in the present and the future until we get to a better spot financially. I would have her working if she's able to. I think you're going to need to ratchet up the overtime and maybe a part-time job on top of that. Because right now, I don't think the mortgage is the big problem here. I think long term, you get your income a little higher, we can make this work. If you're making five or six grand a month, now these numbers aren't that scary. It's not like you have a $4,000 dollar mortgage payment. That's a reasonable, you're going to pay 1400 bucks in rent somewhere. And so this is, I would... Do you have a professional that's looked at it who said, hey, this, you need to deal with this within this time frame?

That's what we're working on Mostly the two companies that you've had come out, they are just like, they don't know how fast it's necessarily progressing or how bad it actually is. We thought about, we've been thinking about trying to find a maybe just a local inspector or something like that that can come in and maybe try to get a go to the- That 100 % do that because a foundation repair company has a job, and that is to, they put all those little sensors out and they say, It's not perfectly level and we can fix it for this much money.

But get an inspector out. It's worth the four or $500 you're going to pay to bring him out and say, Is this the thing I have to do right now, or is this the thing I need to do in five years? And let him tell you. That would be money well spent just for your peace of mind.

Then maybe you track it and go, Hey, here's how it's progressing based on what he said. And if it gets to this point, we got to make this happen. But I would act like you need to make this happen next month in the fire that's under you guys to get to work and get this money saved. Okay. And so if that means pausing the baby steps right now because you're in storm mode because it is an emergency, great. Maybe the inspector says, Hey, I wouldn't worry about this right now. I'll check back in a year. Well, that gives you breathing room to go, Okay, we can knock out our debt and get this foundation repair money saved up. So we need a few more facts here to give us some peace about the next steps, but I think you're well on your way. The income is really the glaring issue here, and the good news is that's fully in your control. It's not going to be fun. But for six months or a year, you can do just about anything and suffer through it and live to tell the tale. So I wish you guys the best on the journey to debt freedom and a smooth, stable foundation, literally and figuratively.

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Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. I'm George George Campbell, joined by Dr. John Deloney, and we're taking your calls at 888-825-5225. You call us up. We'll help you take the right next step for your money, your relationships, and your life. Ryan is in Flint, Michigan, up next. Ryan, what's your question today?

How are you doing, gentlemen? God bless. I have a few questions, but the main one I'm trying to get through is that we've been listening in the way I'm listening to Dave Ramsey's Total Money Makeover. I listened to one of his seminars about baby steps, and we were trying to dial in a few things. Now, I don't know if you want me to go into how much we make and how much debt or not to help with these questions.

Well, you tell me the question, and then we'll dig in with some follow-ups.

All right. Thank you, sir. First one is that I know you guys said something about a savings should be around 1,000. We have about $9,000 in our savings, and we have a car. The one car that we have, it's debt that we want to off, and that's roughly around 10,000 to 11,000. And we're just not used to not having some, I guess, oh, crap money to fall back into.

Is that your only debt?

No, we have the car. And as I've been listening to the books and what you guys say, I've been lied to, so you must excuse me about this. But we have a car, we have two lease trucks. Our biggest is our house, our mortgage. And then from what I understand, we have two loans that we took out on our 401, our Roth. We pay ourselves back on those ones.

Well, yeah. But you unplugged all the growth and paying interest. Yes, sir. Okay. I'm less concerned about your, oh, crap emergency fund and more of your, oh, crap debt that you guys have racked up. How much do you guys make?

Between me and my wife, total, probably around 200.

Wow.

That's a great income.

Yeah, we're just not great. I mean, we ran into some issues. We moved in and we outlived. Let's just say we outlived what we had and what we had coming in until we got to the point where we were just about underwater. The wife had 34,000, I think, on her cards. I took the loan out of my 401 to pay her card off. She took another loan out to pay the credit card off. So once the credit card was paid off, I thought, well, man, we should be getting an extra thousand of $1,500 a month. And it just didn't start equating to that.

It just disappeared into more spending, lifestyle.

You got it 100 %.

That's the American dream right there. You summed it up. Okay, so you've been Robin Peter to pay Paul, playing Whac-a-mole, taking out one debt to pay off the other debt. What is your question today, specifically, that we can help with?

Okay, so once we pay off the car with the savings that we have now, do we just keep a thousand in there or because of our expenses, say our mortgage and whatnot, should we keep a little bit more money than a thousand in there?

The thousand dollars does not change based on expenses or income. It's a flat thousand dollars, and it's not meant to cover Everything. And so if something did occur where you needed more than a thousand dollars to cover an emergency, you would simply pause the baby steps, and that next check that comes in, you would use toward the emergency. You'd sell stuff, you'd work extra, you'd cut your lifestyle down to nothing until you got through the emergency. Now we're back to the baby step two, paying off our consumer debts.

Excellent. And now the next one would be, so obviously from what you said, we should not be borrowing from our 401 because of the interest we'd be messing out on, the accumulated interest. Yeah.

There's 14 reasons why it's a bad idea, but we won't get into that today. Are you committing, live in front of America, that you are done borrowing money? That's the big question I have for you. No more leases, no more zero % cards, no more borrowing from retirement. Are you guys done with debt?

Yeah, we're done. That's where 100 %. I'm more committed than, I would say my wife is committed to, and I'm very committed on it because I'm tired of living the paycheck-to-paycheck life. For what we make and what we do, we should be able to be fine and live way better, at least have more money in a savings. So I'm 100 % committed. It's just these few of these questions that I'm having. I'm trying to rationalize in my head to get my head around, wrap around how you guys want us to do this Have you guys ever created a budget together where you actually sat down and said, All right, here's the paycheck's coming in.

Here's all of our expenses for the month. We're going to track our transactions.

Sir, we just had. We've been married. We've been together almost 20 years. And about maybe two, two and a half years ago, we just put our accounts together. Wow.

Congrats. Welcome to the big league.

Yeah, I know. Right. And that's when we paid off the debt, and that's when we started, okay, we need to accumulate. So primarily what we do right now is most of our stuff comes out of our savings account, check-in account. And then we, for groceries and other things that we have to buy, for the most part, goes to the credit card, and then we just pay the credit card off every week.

Oh, a new character has entered the scene here, the credit cards. Tell me about those. Yes, sir. How many do you have and is there a balance?

It's just one, and usually there's only the balance for the week prior, which is gas if we get groceries, and that's pretty much about it. We put gas, groceries. There may be a few other bills I'm had to look to see that goes on, but we pay it off pretty much every week with every check. We don't occur a balance and let the balance hold on it, so we just paid off 34,000. We're not trying to get a balance on it. We pretty much pay it off every week, regardless.

Wow. You told me you're not going to borrow money, but you're okay temporarily borrowing someone else's money with the promise of paying it back within the week. It's like, Hey, bro, I got you. I got you at the end of the week. Essentially, right? Yeah. Here's my challenge to you, and I put this in my book, Breaking Free from Broke. It's a 30-day no credit card challenge where you put the thing in a block of ice, you put it in a drawer you don't have access to. And just for 30 days, only use a debit card or even cash envelopes. And the goal is, let's see if you didn't have more peace in your life, if you didn't create more margin to throw at the debt, if you didn't miss the credit card rewards you thought you were getting. And what I found is most people go, oh, my gosh, instead of the 2 % cash back, I spent 10 % less than I was spending.

Yeah, that sounds about right. And we only do this because of my financial, my 401(k) guy said to do this. And the main question- What is a 401k guy?

A financial advisor told you to open the credit card?

That's exactly what he said. He said we should have everything going on in the credit card that we pay and then just pay that off.

Is that That's the same dude that gave you the 401(k) loan?

No, I did that from Fidelity for my work because I get work and matching and I'm able to just go in there myself and take out. But that was, he told me that's what I should do in order to pay the credit card off.

Bur, I say this with all due respect. You got to fire that guy before the day is over and get a new guy.

I've been feeling like that. I just told my wife that the other day. Today. Just the other day, I told her, I go, So I'm just not right with what this guy is doing, and I'm just not feeling right about it.

You've been following He's advised for years, and you're broker than ever.

Yeah, I can't.

Are you guys still investing as well? My guess is you're still putting some money into retirement.

I am at 8 %. I think I get a three and a half to four % match from work, and my wife is roughly around the same. I rolled over a previous 401 to this Ross with this guy.

Correct me if I'm wrong, but I didn't know you could contribute to your retirement once you take a loan against it until it's paid back.

I can contribute. Yeah, contribute. No. Mine is it takes a certain portion out on top of my percentage that I'm putting in for the match.

Okay. Well, here's another thing I would encourage you to do is to stop all investing until this mess is cleaned up. Because right now You're doing 17 things at once, and you're not seeing progress on any of it.

I got you. With the debit card, you're saying just go to debit card and just don't even worry about credit cards then?

Exactly. I've been living that life for 13 years. I'm going to send you a copy of Breaking Free from Broke. I cover the whole debit card credit card thing in the credit card chapter. So read that, and I'm going to hook you up with every dollar. This is going to be like John and I in your pocket, coaching you 24/7 with new recommendations based on where you're at financially and educating you along the way. So hang on the line. We'll get you the book and every dollar. I'm rooting for you, Ryan. This is a solvable problem. You make $200,000. There's no reason to be this broke.

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10% off, up to a $250 value. See store for details. Jamie is in Chicago up next. Jamie, welcome to the show.

Hey, George. Hi, John.

How are you? We're doing great. How can we help today?

So I've been following the plan for quite a while. I got rid of my car. I paid down all my debt. The only two things I had left are my student loan I have a debt and my mortgage. My mortgage, I owe 98,000 on. And unfortunately, on my student loans, I owe today 142,000. Last Wednesday, I learned that my I'm in a position that my job is going to be eliminated, and I will be without a job on February first or on second. And I am freaking out. I feel like- You have a right to be. I don't have I only have about 25 and 401k. Obviously, I'd want to get that student loan debt out of the way. But with my separation, I'll get a seven package, but it's only going to be about 16,000, and that's before taxes. I am not sure.

That floats you three months? What do you think?

Yes, three months.

Okay.

What do you do?

I am a facility planner.

For a guy who's not very smart, what does that mean?

Basically, I manage- What does that mean? For a large health care company, I manage the plans before plans and where people sit and departmental allocations, things like that.

You help with the logistics.

What is your chance of getting a new job quickly?

I hope. Well, good, but it took me a couple of years to get that job. Okay. John, I'm glad you're on this call. You'll understand this. I I was on disability for some years and was able to get back into the job market. This was the position I landed, and it's been a really good position for me. I work from home. I'm nervous about the things that go around with social anxiety and those kinds of things.

I don't see a problem. I'm going to give you a word. It will be, but I'm going to give you a word that most It might cause some people listening to, inhale sharply, okay? Okay. But I'm telling you this word because I believe in you and I trust in you, okay? You have an absolute emergency on your hand. Yes.

Agreed.

You have proven to yourself, you have documented evidence over the last few years that you are not who you once were. Exactly. And these big events, a job loss, somebody passing away who we care about, our body wants to drag us right back into this is how we always handle things.

Right.

And you have a bona fide emergency, and you've got a tiny little runway to land the plane, right? Right. And so what we're not going to do is turtle up. We're going to grieve the heck out of this thing, but I'm going to say this, it's going to sound crazy, we're going to grieve it later. What we're going to do is start applying for jobs like mad. We're not looking for careers, we're not looking for exact replicas, we're not looking for perfect work from home situations. We're looking for two jobs that we're going to go to in the morning and in the evening, and we're going to feel the social anxiousness. We're going to feel it, and then we're going to go through it because we have an emergency on our hands. On the other side of this, you're going be so freaking strong that the landscape of jobs available to you will double or triple in scope. You get what I'm saying?

Yes, I do.

It's going to be hard, it's going to be scary, and your body is going to want to go back to what it has done in the past, which is turtle up and wave the white flag. And we're not doing that this time. You've come too far.

Exactly. And that's exactly why I'm calling, because I felt like my instinct was to go back to that old thinking. It's like, No, I've come so far. Why would I do that?

We're going to apply for coffee shop jobs. We're going to apply for maintenance jobs. We're going to apply for waitress jobs. Everything. Everything. Okay. Everything. Because what you need right now is, A, a reason to get up in the morning, and B, you need money.

I think about this. If you could work so hard that you didn't need to touch the 16K, and you could throw that whole thing at the debt once you get some stability. That's the goal. You're going to be on cloud nine.

Yeah, Exactly. That's what I was thinking.

Make that the goal.

I just wanted to make sure that I'm doing the right thing.

Now, you're not a bad person if you touch the 16 grand. I'm not mad if you use the severance, but how cool would it be if you didn't? It really propelled your baby steps. Instead of waiting three months, the money runs out and you go, Well, I guess I need to find a job now. That's not going to help anything. I'm not going to do that.

We're going to apply for fancy jobs. You know the difference, what I'm saying. I'm not trying to be a jerk, but we're going to go get waitress jobs, Home Depot jobs, whatever, and we're going to apply for the facility management jobs, these bigger picture things that are going to take longer, they have longer processes. We're going to apply for those in the evenings and at night.

Okay. Sounds good.

We're going to send you Ken Coleman's, Find the Work You're Wired to Do. It has the get clear career assessment in there. And what it's really going to help you do is figure out, hey, what are the skills behind the work I've been doing that I really love and enjoy and I'm good at? And what other roles can I apply that to? Because right now you're thinking, I'm going to type in these keywords. And I think there's so many underlying skills. You can take a logistical nightmare and clean it up and organize it. Sure. That's an amazing skill to have that you can apply into anything. Project management. That would be a great field for you. What is your degree in?

I have a degree in interior design and a degree in psychology.

I love it. Have you pursued interior design at all as a career?

I did. That's why it took me so long to find this job because I felt like I wanted a very specific commercial job, and it just wasn't happening. Then I found this job, a recruiter each up.

Well, on top of your job shopping, I'd contact 10 interior design companies in your area and say, Hey, I have a degree in interior design. I'm ready to start tomorrow.

Okay, I will do that.

I mean, you got the degree in it. You spent a pretty penny to get it. Might as well give it your best shot. It did. This might be the on-ramp you needed to go. I needed to get laid off in order to go pursue the thing that I really wanted to do.

But here's your keyword. Okay. We're going to go. Go. We're going to act.

There will be no hours left unspent twiddling our thumbs.

You're going to close your computer screen and go for a quick walk around your neighborhood, and you're going to put your head on your pillow exhausted because you You've been working so hard. The energy has to go somewhere, right? It can paralyze you or you can do it to solve this present emergency. Exciting?

She's paralyzed in excitement right now. That's so great, Jamie. Thank you for the call. John, let's talk about this because a lot of people... We talked about this on the show that it's like losing a loved one, like the grief of losing a job. Yes. The shame, the guilt, the fear. It's like all the emotions.

In her situation, having a diagnosed anxiety condition, the thing about anxiety that's the worst is the only way through it is through it. You're going to have all of these feelings. You're going to have all these emotions. She has an emergency, and millions of have an emergency. What many people do when there's an emergency is either they run around bananas or it's creating more mess, or they just take their foot off the gas, put the car in park, and exhale. She doesn't have that luxury. She owes a couple of hundred thousand dollars in various things. We're going to have some direction. We're going to go get a job, get some money, get some connections. We're going to apply for some jobs. We're going to read a book. We're going to have coffee with somebody who's in a job adjacent. We're going to go do a bunch of stuff. The weight of this, dude, I got fired. They took my job away. That grief will be there, but we don't have the luxury of just stopping for a season. We got to go get a job, and we're going to go, go, go, go.

I love that. An object at rest stays at rest. Once you stop, it is so hard to get moving again. You get comfy, you get your favorite Blanky, you're watching your favorite Netflix show, and you go, Well, that's a problem for tomorrow me.

Yeah, it's hard, George. If it's nine o'clock, I go to bed early because I'm a nerd, and I sit on the couch and just say, I'm going to watch one show. It is so hard to get up from the couch and just go to my room to bed. I should have just stayed up and gone to bed and got the extra 30 minutes or 45 minutes of sleep. Similar here. Man, if you exhale and be like, Well, I've got this 16 grand. That 16 grand will be gone before you can sneeze, and now you're going to be in a real mess. You're taking your job away in a month. Tiny little severance. It's time to hit the gas and go.

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One of our favorite things is hearing people share their stories of how they're winning with money. We just heard this from Claire and Winston. This is me and my husband's third month budgeting with the EveryDollar app, and I'm amazed how much money we found. We went from feeling like we were living paycheck to paycheck to finding $3,500 of extra margin each month to put toward our debt. We each had four credit cards and have been able to pay them all off, never going back. We love to hear stories like that. And the truth is, you can do this, too. That's not just a Claire and Winston thing. That's an anyone thing. You can take control of your money. You can change your family tree and live like no one else. And it starts by downloading the Every Dollar Budgeting app for free in the App Store or Google Play. Go see how much extra margin you can find with a little bit of that coaching and encouragement. Lee is in San Antonio up next. What's going on, Lee?

Hi.

Hey, how can we help?

Well, so my question Question. I'm a little unique. I went through a divorce in 2024, and by the grace of God, as of the holiday season of this year, we are reconciling and God's restoring our marriage. Wow. Yeah, it's really beautiful. My question, however, has to do with... So when we were married before, I was not great in the financial department. My husband was with the same company for almost 20 years. Hard worker, always provided. I I've jumped from job to job, wasn't the best with the money, racked up a $10,000 credit card, all of that. So over the past year, while we were apart, I graduated from FPU and have followed Dave Ramsey And I'm working with a company right now to pay off my credit card. So I'm hopeful that within the next couple of months, that will be paid off. So I will myself be debt free. My question really is, I know that Dave is pretty vocal his opinion that when a couple is married, that there is no my money, it's our money. So understandably, given my past behavior, my husband is a little hesitant to go back to commingling our funds.

So I'm just looking for some guidance on how he and I can navigate that this time, just as that trust is built back up, and maybe just some guidance on how to navigate this season.

What other trust was broke in your previous time together?

Well, there was no infidelity or anything like that. Honestly, my story is that I really just was in a really bad place. I believed a lot of lies about myself and my marriage, and the enemy convinced me that it was right to leave, and so I just did. I just picked up one day and I left. There was no seeking God in any of that. So really, the trust that was broken It was just me giving up on us. Okay.

I want you to hear his hesitancy as not about money. It's deeper than that. If it was a surprise to him, not that you all were in a tough season, not that you were struggling or anything like that, but if it shocked him when you walked in and said, I'm out, I want you to see that what it was, which is you pulled a pen on a grenade and rolled it into his life and exploded it. Yeah. Right? Now, every couple co-creates their relationship. That is what it is, right? So I'm sure he would sit here and tell me he's not perfect. I get all that. But if you're going to truly say we're reconciling, there is no reconciliation. I mean, you can get remarried. You can do whatever you want, but there's not a true remarriage. If both of you don't have your feet in the boat. At the same time, he's still living. He still has fresh scars from when this person he's getting back into the boat with, shot a hole in the middle of the boat and then swam to another shore. You get what I'm saying? Of course. Here's the path back.

The path back is, will you give me, being him to you, a very clear roadmap that I can follow to reestablish trust? Because Trust will not be reearned in huge grandiose moments. It will be earned in a thousand tiny little ways over time. The commitment here is we're going to do this every 30 days, every 60 days. It's not you groveling. It's not like, How am I doing? Do I get an A on trust this month? It's not that. It is, I want a clear path back. If we're going to really get remarried, we're going to go all in on this thing again. Both of us have to put our feet in the boat, and you'd be crazy to do that all the way. I I get that. I'm going to ride in your boat for a while. I'm going to ride shotgun with you. What is a path to reestablish trust look like? And he's going to lay that path out, and then you get to decide whether I'm going to follow that or not.

Yeah.

All right? And Here's the other thing. If he says I'm in, he's got to be all in, too, which means he has to risk that the person he's marrying does this to him again. That's the risk of any great marriage and any great relationship at all, right? Is that you could get hurt. So he needs to give you a path. You need to ask him not, Hey, why aren't you sharing your money? You don't trust me. And not you hanging your head in shame saying, I'm not trustworthy. We're past that. We're going to start establishing this, what does a path look like for me to reestablish trust? And let's take infidelity. Sometimes people say, I want to see your phone every night. I want us to get new phone plans. I want us to change our numbers. I want you to cancel all your social media. Here's the thing, the person who got cheated on can lay out whatever path they want, and then the other person gets to decide whether I'm going to follow that path or not, whether I want to be a part of this relationship or not. When you start walking that path, they can't weaponize the past because they have said, I'm in this, too.

Reestablishing money, sharing your money together is part of me and my wife share a single account, George and his wife do. Dave and Sharon. The people that I know are that are successful, and the data bears it out, couples who share finances do better, not just because of the money, but that means they share a picture on what they value, where they want to go with their life, what their shared vision is, all that stuff gets wrapped up in, we all know where the money is and all that. It's just you humbly asking for a clear roadmap. We're going to do one at 30 days, we're going to do one at 60 days, we're going to do one at 90 days, and we're going to continue to work down this path together until both Both of you feel safe enough in your guts that both feet are in this boat and we are row in the same direction.

Can I give you some ideas, Lee, of some tactical things you could do? It might make him go, Who are you? Number one, cut up all of your credit cards and close all the accounts. And then- All of them. Here's the baller move, you freeze your credit, and you give him the passcode so that you can't open any type of account. You can't take on any type of debt if your account is frozen, if your credit's frozen. And then on top of that, say, Hey, you know what? We're going to have a joint account, but I don't want the debit card right now. And we're going to turn on transaction alerts so that any time anything comes out of the account, we both get a text message of what happened.

Or to celebrate your guys getting back together, we're going to give you a year of every dollar premium. It will alert each of you if somebody spends something with a debit card.

Okay.

But these are some things you can put on the table when he's like, What are you talking about? A roadmap to trust. I'm going to do this thing and this thing and this thing. I I want to know a path so that we can reestablish trust in this marriage, all in, both feet in the boat, both of us.

Here's what I've already done. Here's what I'm doing now. Here's what I plan on doing. I'd like to check back in. Then maybe you guys agree on a timeline. Hey, we're going to check back in. And six months from now, if all is good, then we're going to open the floodgates, and we're just going to fly and build wealth together. I think that will prove to you more than to him.

That's exactly right.

That has changed. Because I don't know that you trust you right now, Lee. You probably have some shame and guilt and baggage.

Yeah, for sure. And by the way, you have to have the courage to say, I don't want to reengage in this marriage if only one of your feet is going to be in the boat. And so you get to say, One of my bedrocks, one of the thing that's going to be important for us moving forward is that we get back to trusting each other enough to share money, to share whatever. But I also know that's a tough, scary thing right now, so I need a path. But you get to say this is a big deal to me, not just I'm going to put my head down and go along with whatever he says because I screwed up and I'm just a whipping post. It won't work that way. You know what I'm saying? I'm proud of you. I do.

Thank you. This is a big step, Lee, and I'm so just inspired by the reconciliation, and I hope that you guys are fully reconciled soon. Full unity, building wealth together like never before with an amazing marriage. So hang on the line. We're going to send you every dollar. That'll impress them. Go, Hey, I'm working on my budget this month. You want to take a look? Who is this person?

Or our budget.

Now we're talking.

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Today's question comes from Wyatt in Montana. Dude, Wyatt sounds like he's from Montana. I love this already. I love that name. We recently started the Baby Steps, and me and my family are on step two. We've been snowballing pretty successfully. He sounds like a Wyatt. We've been snowballing pretty successfully by selling stuff, and we're making good progress. Our question is that with all the stuff that's going on around the world, how is it rational to stick to this? My instinct is to use extra cash right now to cash flow, stocking up on food, ammo, and water. Should we really stick to the baby steps or make sure our family is ready for any unexpected disaster? Wow. This could have been a question from John Deloney in Nashville.

You wish you were Wyatt, Montana.

I do.

Okay, so there's a part of this that I understand, which is, hey, there's some crazy stuff going on. Should we just stockpile some cash in case? Because we got debt. If he's on baby step two, it means he has $1,000 to his name in savings. The rest is going towards consumer debt. So is this a storm mode where you go, we got to bat down the hatches and just save up money? I'm going to say no. Should you stick to the steps? Yes. Should you make sure your family is ready for unexpected disaster? That's the part we need a definition on.

Right. If your unexpected disaster is the air conditioner going out, you losing your job, the stock market crashing, not owing anybody any money is a really great place to find yourself. Having no other payments other than we have to scratch and claw our way to pay our bills.

There's a real disaster in front of you, which is the debt. The mess that you made. I'm not going to focus on what could be and is there going to be World War III and it's all going to come down and therefore I'm going to hang on to my debts forever. That's a terrible way to live.

Yeah. The Again, I quote my friend who told me this years ago, but I don't have a meteorite plan. I do. I have a lot of meat in the freezer. Hunting season just wrapped up here, so I do, right?

Am I going to Deloney's house? If something goes down, absolutely.

He would never make it. But do we have unrealistic stockpiles of water, et cetera? No, because if the local municipal water gets cut off, we're going to have a whole different issue going on, right? I I think people like to think our family's life is going to be like this, just minus these things. It will not be. It will be such utter wild apocalyptic chaos. It is easy to get distracted when you're doing... When you get past the energy stage, George. It's like the January 15th at a gym already. It's starting to fall off because everyone got excited. They started their first workouts. They even got sore the first couple of ones. They feel like they're doing something. Then January 15th, you're like, Oh, I just have to do this forever. It just goes, wham, wham. And so it's real easy when you're in baby step two, you're selling stuff, you're feeling it, paying debts off, that you look up and you're like, Oh, we have two more years of this? Four more years of this? What about water and ammo? Stay the path.

Stay on the path. The other thing is, dude, you live in Montana, not Gaza. Let's not act like it's all coming down in Montana. There's some scary There's some scary things happening. Montana is fine right now. And so unless there's imminent danger in your area, I would stick to the plan. And if something really did happen, sure, you can pause the baby, step, stack up cash. I don't think the Apocalypse is on the list right now.

Well, and Montana is probably one of the places where you'd want to find yourself. That's where I'd want to be. If it all went down, I would love to be in Montana.

Don't tell the zombies. They'll go there first. They'll never make it. All right. Tim is in Los Angeles up next. What's going on, Tim?

Hey, I I was curious. Me and my wife are getting ready to pay off our $148,000 worth of debt. Yeah, I know, right? And I was trying to see what's next because we do have a three-month emergency fund. But we're trying to wonder, too, with these Trump accounts, should we just... If they happen, great, but we're trying to figure out, should we start investing in a high yield savings or something like that for our kid now who's doing April.

So you're in Baby Step 2. You've already done Baby Step 3, and you want to skip to Baby Step 5. Did I hear that? I suppose, yes. Okay. I would do them in order, which is take your emergency fund and let's focus on the emergency at hand, which is the debt. Could you clear your debts with the amount you have in savings?

Yes, we could do it, honestly, within probably the next 30 to 60 days, even without the emergency fund. And that's where I'm at.

And you know, I'll be obviously- All right, Ben, then pay off your debt today and spend the next 30 days restocking the emergency fund.

Okay.

In Vegas, we call that I call.

So that's one idea. Number two, once you are through Baby Step 3, you're now a Baby Step 4, which is to put your own mask on and invest 15 % in your own retirement.

The other problem is we don't actually own house at this time, especially here in California. It's a little more difficult these days. And so that's the underlying question is, do we just pay off the debt and then do that because it's an intensity towards a house or put our child's future ahead of our own.

Well, I don't think any of those are the options. I think you should invest 15 %, and if it's going to take you a long time to save the down payment, that's okay. If you're going to stay in California long term, it might take you eight years to save a down payment instead of two.

Right.

And so that's the math of it. But I would not put any money towards... And here's the thing with the Trump accounts, the government is, did you have a child in 2025 through 2028? Is that the plan?

Yes.

Okay. I'm going to open one, and here's why. I would love the free $1,000 from the government. After all the money I've given them, it's time they give a little back. You don't have to put any money into it. I personally wouldn't. I did a whole video on this. It's really not super impressive other than the free thousand bucks that will grow from age zero to 65 into a few hundred grand. That's awesome. Not mad about that. But I would invest for your kids in a 529 plan which has tax advantages of tax-free growth. If you want to invest outside of that, you could just open up a brokerage account in your name, and you can use that to save up for their wedding or a down payment on a house for them one day.

Right.

So I love the motive behind it all.

And the 529 plan, how exactly would you go about that? That's the first time I've even heard of it.

Yeah, well, there's a blog about it on our website, and so I'll make sure we get you that link, and we'll put it in the show notes as well for anyone who's interested. But a 529 plan is just a plan to save for college where you use after-tax money, and that money then grows tax-free for education purposes. You can withdraw it tax-free to use for your kid's college. And they've even expanded it now. It could be for trade schools and training and supplies and all kinds of things. So it's a great way to save for college with compound growth and some tax advantages. So that's what I'm currently doing for both of my kids. I put money in there every single month. If they get birthday money from grandma and grandpa, it goes into the 529 account. But here's the bad news. If you don't invest for a retirement, your kids are going to have to fund it. And so that's why we tell people to put their mask on first. There's 100 % chance you need to retire one day, 50, 50 chance your kids even go to college and graduate.

Right.

So you're doing a lot of good things, Tim. You've got a great heart, and you're so close. You're on the cusp of this amazing financial foundation. But I would just Do the plan in order. It works, man. It works. Pay off the debt today. And if that scares you, that tells me that you probably should do it because you'll stack up that cash in no time. If you put 20 grand towards the debt, and now we need 20 grand in the emergency fund, well, now we're just paying ourselves instead of a lender. I would rather do that any day. It's hard, John. There's so much you could do. There's so many things that are good things. We want to pay off debt. We want to save. We want to save for the kids. We want to save for retirement. And that's why I love the baby steps. It just takes out all the ambiguity and gives you just a clear, No, do that first. No, do that next. And that's what I do. It's what I've done for my family. It's what John does for his.

I get it, though. It feels so hard when the world's all screaming at you from every different angle. It's hard to just stay the course, just stay on the path.

And now there's a new one, the Trump account. So now we're distracted. It's like, squirrel. It's like, look over here, look over here.

It's like, just the folks that win unhook from the system completely and just follow a different path, and we've laid it out for you.

Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. I'm George Campbell here with Dr. John Deloney. Open phones at 888-825-5225. Theresa is in Indianapolis up next. Theresa, what's going on? Hi. How are you? Doing great. How can John and I help?

Well, so my mom is 82 years old, and she just got hearing aids for $2,000. She is asking me and my sisters to help pay the money back that she charged her credit cards. She lives on her Social Security. She never really saved for retirement. I feel like even every time we go out, she expects us to pay for the dinners or lunches or whatever we do. Most of the time I do, but not all the time. I've helped her before with her budget, and I know she could save to pay for this purchase, but how do I approach her about asking for money and the entitlement she obviously feels that we owe her, what What would you do? I'm on baby step two right now and really don't have the money to give her.

I think you just answered your own question. I think the part that sounds like it's weighing you down is the stories you're telling yourself about her request. If you've offered to pay for dinner a bunch of times, I don't fault her for just assuming you're going to always pay for it. If you think that's a move on her part, and she's done that before, and she's always trying to... Like your whole childhood, she was trying get people to pay for food. That's another story. But if you don't have the money, you can just say, Hey, Mom, I'm working on my own finances. I can't kick in on this time. That's it. And you can't control what questions she asks you. You can't control her temper tantrums. You can't control the guilt you would feel because you want to be able to do it. You just can't right now. You can't control any of that stuff. What you can control is what you do, the next right move you make. Your feelings are going to happen regardless. What's the next right thing? The next right thing is I can't afford I can't help right now.

Have you ever pushed back on her and just said, Hey, Mom, I love you. I want to be honest. I'm not able to give you money anymore. I got to focus on my own financial responsibilities.

I have. I've said to her before, she asked me, Why haven't we been doing some stuff as much as we used to? I said, Well, Mom, I can't afford you. Every time we go to lunch, you expect me to pay. And then even when I pay, you don't say thank you. And I just I don't have the funds. When I think of going out, I have to watch my penn because I'm trying to get out of debt.

But can you all do other things? Can you all go for a walk? Can you take some dominoes over to her house? Is it have to be things that we spend money on?

No, it doesn't. I've tried to curve it that way as well, too. Sometimes it's just really hard because I know she's never really been ahead of the eight ball with money. I just wish I was in a better financial position to help her with these things. But some of it, I feel like she set herself up for this, too. Yeah.

But you just nailed it, and I didn't want to say it out loud, but you said it, so I want to pull that string a little bit. A lot of this sounds like she's making request that you, as her daughter, wish you could just give her the world. You can't. If you feel guilty, if you feel bummed out, if you feel sad about your own financial situation, Man, don't compound that frustration and pain, and guilt, and yada, yada, by blaming her. It would be cool if we all had enough money to give our parents whatever we wanted, but most of us don't. It just stinks. We can either just cut off contact, which a whole bunch of people do, which I think is insane, or we can say, Hey, I'm going to start coming over to your house on Tuesdays. I'm going to make a coffee at the house and bring over a picture of coffee, or Mom, you make the coffee. I'm bringing the dominoes. We're to play. I can control that part. It's not as cool as a hip diner in whatever town and yada. But it'll still be valuable time with your mom that you'll be glad that you spent.

What do your siblings feel about this? Are they also wanting to stop the forced giving?

Absolutely, yeah. We're all in different positions, and we all don't have the money right now. I have one sister has kids in college. The other sister just lost a dog and had to pay for her heater in her house. My other sister just had a surgery, and I had a surgery last year.

Here's the better part. You don't have to have a reason. You can just say, Mom, I can't help out right now. Thanks for thinking of me. And that's it. And then hang up the phone.

And if she chooses not to pay the credit card bill because she won't or can't, then she deals with the consequences of It might go to collections. Someone might be harassing her on the phone, telling her she needs to pay or else.

I don't know if you can repo hearing aids. I don't think you can, but maybe. I don't know.

Yeah.

But that's the hard part of setting the boundary is it makes you feel bad, but you need to just repeat the boundary and make it clear, because otherwise, if she knows that boundary is flexible, she's going to get over it every time. Every time. So just hold the line, and about four times in, she's going to go, Oh, this is a dead end. I'll try another sibling. And if she chooses to opt out of the relationship because of that, the sad part is it was transactional for the who knows how long before that. Does she reach out without money being involved?

Oh, yeah.

Oh, yeah. So there's a relationship outside of this?

There is.

Okay, good. Maybe one day, you guys are all in a better place and you go, Hey, we're going to take mom on this amazing trip. But it needs to be on your terms. Right now, all of it has been entitlement and guilt instead of, Man, it'll be really cool to just cover mom's hearing aids. That'd be a cool gift to her.

But if you like her and want to spend time with her, go over to her house with some dominoes and some coffee and some homemade cookies or whatever, and when she asks the question that she's inevitably going to ask, which is, Can I have some money? You say, No, I don't have it, mom, right now. All right, your turn. And maybe choose to deal with a couple of awkward questions or annoying questions or guilt-inducing questions for the greater sake of the relationship. But you and your siblings don't need a whole bunch of, Well, I got college and I got a sick dog. You don't need all those excuses. You can just together or individually say, As for me and my house, right now, we're not going to participate, but we love you. We're still going to hang out with you.

She's not going to be on the street. I mean, she's not in dire straits here, right? Does she have other financial problems that are pretty intense, or is it just, Hey, she owes a little bit on a credit card?

No, she just constantly, like something happens, she puts it on the credit card. She's just in a cycle. I've worked on her budget before when she let me, and I even bumped it up a little bit so that she didn't realize she was actually saving money. But now she won't let me... It's been a couple of years and she won't let me redo her budget so that I can help her.

She doesn't want you involved on On that side.

Yeah.

That's a sign. If she doesn't want your help getting better with money, she just wants the money, then that's a sign that you need to stop. And maybe one day she opens up again and says, Hey, listen, I'm struggling. I got collections people calling me. Can you help me figure out a way out of this? And you go, Yeah, here's a way out. And it's not going to be you giving her money. It's you showing her how to get out of this once and for all. And maybe that'll get her to stop using a credit card. The hard part is the credit card companies are insane. For giving an 82-year-old a line of credit who's living on Social Security.

Well, they're not insane. If their kids are going to pay it back, you know what I mean?

It'll get paid out of her estate or collections, or it'll be a tax write-off one day. Madness.

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John is in Fortworth, Texas. John, welcome to The Ramsey Show.

Hello. Good afternoon.

How are you doing?

I'm doing pretty good. I got a good spot to be at, but I still have the question of what do I do. So I'm wondering, where do I go from here, me and my wife, with our investments in the future? We just completed. We're basically We are Baby Step 7 now, just this month paid off the house.

That's amazing. Congrats. What's the house worth?

About 300,000.

Awesome. And what do you guys have in a retirement?

Right now, because we did put basically just 10% at the time, we just stepped that up, or she stepped hers up for a 401(k), we're sitting around 155, I think, counting hers and mine together. But where I currently work, I only have a Roth IRA option. They don't have 401(k), they don't have 401(k).

They don't have a retirement plan through your employer. Correct. Okay.

So we're doing that. We started that last month. I started funding mine for last year, and now this year, I'm going to end up funding mine and one for her. That way it gets me to the 15 % or actually above it, just max it out.

Yeah. What's your household income? What's the gross income you guys will bring in this year?

2026, it should be about 150. We were beyond that before because I used to get a lot of overtime by changed jobs this year. Pay went up a little bit, but no overtime.

Okay. Cool. So what's your question?

Well, where we go with the investments from here. So after the IRA, after the 401(k), we're going to have the house payment. Plus, we were putting up to 17 grand, actually a little more than 17 grand a year extra on the house to get the house paid off in 10 years. We actually beat 10. We're at nine years in a couple of months is That's what we ended up with.

That's awesome.

So we were still able to live our lives off of that. So it's like, okay, do I just put the rest of it into a brokerage account for a, like a S&P 500?

You said your wife has a retirement plan through her employer?

Yes.

What is that?

Uh, hers is currently a traditional, and she said that they were changing that to a Roth. Okay. But right now we're trying to figure out where we have to do, what percentage we have to do out of our pay. That way we can max that out, which is, I believe, 18,000.

Well, the 401k is closer to 23,000 or 23,5. So here's the good news. 15 %, which you can invest more, of 150 grand is 22. 5. So you still have the tax advantage options. If you both do a Roth IRA this year, I think they just upped it to 7,500 is the cap for each Roth IRA. So that puts you guys at 15 grand there, leaving seven grand to invest. You could do seven grand in her 401(k) on the Roth 401(k).

Yeah. But then after that, the way I look at it doing the finances, we're going to we're going to eclipse that. We're going to have more than that.

You'll have more. Yeah. So you could fully... Let's try to max out the 401(k) and max out two Roth IRAs. That would be my goal for 2026, if I'm in your shoes.

All right. But then what do I do with the extra after that?

So you're saying you're going to invest the 23 plus the 15, that puts you at 38,000, and you're still going have more to invest, correct?

Yeah, we looked at our budget and we were sitting around 47. That was like, okay.

Wow, that's awesome. Do you guys have a high deductible health care plan?

No, unfortunately, we don't. Well, fortunately, we don't, I guess.

Because if you have an HSA, you can invest through that, and it becomes a loophole retirement account. So if you don't have that, so I'm going through in my mind, what are all of the tax-advantaged options? And that's going to be your 401k, your IRAs, your HSA. If you run out of those options, then you can be investing into a brokerage account in the market, which is not tax-advantaged.

That's where my question came in because it's like, do we still follow the investment recommendation, growth, growth and income, or do we just do S&P 500?

Yeah, you could do either. I mean, S&P 500 is simple and outside of retirement, that's a great option. That's what Dave would do. If Dave gets a big royalty check for Total Money makeover, He's just going to throw it into an index fund, into a brokerage account.

Okay.

I would just go that route. And how old are you guys?

I just turned 40 and she's 41.

Oh, amazing. Think about that, dude. You're in baby step seven, no payments in the world, investing 40, 50 grand a year. Go pop that into an investment calculator.

We're trying to figure out what to do next.

That's what you do next, and you keep doing it year after year. It's not exciting, and People are going to tell you, Dude, you need to be more sophisticated, and you should put your money here, and crypto is going to take off, and you should buy real estate. Stick to the plan. Stick to what you know, what you understand, and you will be multi, multimillionaires in retirement.

That sounds good.

Congratulations, man. Never go back into debt. Keep investing as much as you can, and also, enjoy your life. We always talk about, John, there's three things you can do with money: give, save, spend. It's easy to have too much muscle in one area. We're like, I'm so good at saving and investing, and you realize it's like hoarding. You're giving muscles atrophied. You're spending muscle. Your wife is like, Dude, we haven't been on vacation in 12 years, and we haven't paid for a paid-four house.

That may have been my house.

That's John. Also mine right now with a toddler and a newborn. I'm like, I'm not going anywhere. But that's a good reminder. Congratulations on Baby Step 7 with the paid-four house. Matthew is in Columbus up next. What's going on, Matthew? You with us? We were so close to a great call with Matthew. It was going to be gangbusters. All right, we'll try again. There he was. There he is.

Hey, Matthew.

Took him a second.

Hi. How are you guys doing?

Great. What's your question today?

Yeah, because I'm trying to refinance the house that I got, and got a lower rate, obviously. But now when I want to pay over my mortgage rate, I was sold, maybe invest that money instead.

Who told you that?

A family member. But I was under the impression, if I can pay off my mortgage faster, I can pay off my mortgage faster, and then that just opens up a lot more money in the future.

Yeah, you're right. That's what we teach in the Baby Steps, and it's what I've done in my personal life. Me too. You can trust a family member. You're still going to go to heaven. But the Ramsey plan says, Hey, if you're in Baby Step 6, which you are, put any extra money toward the mortgage while investing 15 %. So are you investing 15 % of your household income right now?

Yes, mandatory. That's my job.

Okay. Cool. And then how much extra can you throw at the mortgage? How fast is this thing going to get paid off if you follow our plan?

Well, it's going to hopefully refinance, and I'm hoping to get an extra two payments in a year.

Okay. Have you done the- On my mortgage. The mortgage payoff calculator on our website to see what that does?

I have not. I only get to listen to the show for 20 minutes I'm making you home.

Oh, thank you for hanging with us today. I would, tonight, when you get home, I would just pop onto our mortgage payoff calculator, see what those extra payments would do, and then have a game plan and go, All right, six years, we're going to have this mortgage paid off. The good news is the mortgage gets freed up, and then you have the rest of your life to invest that payment.

And nobody can come take your house away. That would be great. Which for all the people who are like, This is what you need to do. This is what you need to do. I'm telling you, man, there's something about having a house that is yours, that even if your local city jacks up your tax rate on it. It's super annoying, but you don't have a house payment. Nobody could take your house. There's something so profound about that safety and security for you and for your family.

Yeah, it's more than math. I've seen the argument, Well, I have a 3% rate. Why would I not invest or even put it in a high yield savings account? I get it. You could make the argument on paper, but those people, they're forgetting about the psychological component, and you truly can't explain it to someone unless you do it and live it. That it just is a more peaceful life. I sleep better because I don't have a mortgage payment. I never think about, man, what could I have made if I invested that money instead of putting it toward the mortgage? I never have thought that once. I just go, cool, I got a freed up mortgage payment. I'm on track to be a multimillionaire in retirement. Life is good.

All right. Excellent.

Yeah, I hear.

Thank you so very much. I appreciate it.

Absolutely. Hey, what's your mortgage payment, by the way?

I'm hoping to get it down to 12. 5. I mean, 1,250 bucks a month. 12.

50. Okay, that's fantastic. Is that principal interest, taxes, insurance, all of that? Yes. Is that just principal and interest?

It's all tax. Everything is all wrapped in one.

I would also do some fun math using our investment calculator and go, All right, six years from now, I'm 46. If I invest that $1,000 principal and interest from 46 to 65, what does that turn into? That's some pretty cool math, too, on top of not having a payment for the next several decades.

Nobody's ever said the words pretty cool math, except for you, George. Thank you. I like pretty cool math.

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Everyone needs insurance, but it can be hard trying to find pros who aren't just looking to make a buck and agents who actually know their stuff. Well, Ramsey trusted insurance pros, they're vetted, they're coached to make sure they're market experts who have your best interests at heart, AKA, they're not going to sell you crappy products that we would never recommend. So if you want to learn more, go to ramseysolutions. Com/ coverage to find the type of insurance you're looking for and connect with a Ramsey trusted agent. Silas is in Tampa up next. Silas, welcome to the show.

Thank you for having me.

Sure. How can we help?

I have a Chevy Colorado, and I owe 36,000 on it. My wife's car, she has a Toyota CHR, and she just had a transmission. It didn't go out, but the dealer Chip told her that it's bad, and they don't know how long it'll last. So it's about $13,000 to fix. And we're 22, both of us are, and we're just trying to get our finances in order. And I want to get rid of the truck, or I want to do something with the truck. I'm just looking for advice, what I can do with it.

Okay. What's your household income?

We work at the same job. I make 1,650 every paycheck, which I get paid twice a month. And she makes around 11 or 1,200. I'd have to look at exactly, but I think it's like 11: 50. She makes about 11: 50, I make about 1,650 every paycheck, and we get paid twice a month.

Got it. So we're talking like 3,200 and 2,200. Let's call it 5,400, 5,500?

Correct. Yes, sir. Okay.

So how much is her car worth?

I just took it. I looked it up on the Kelly Blue Book, and they I said it's worth about 13 to 15,000. It's like they have that fair price, poor price.

Is that the private party value or trade-in?

That would be the private party value. Okay.

And is that with the repair needed, or is that saying, Hey, if we got the repair done, it's worth 13 grand?

Oh, no, that didn't include the repair. That's just it by itself. If it was right now, because it's a 2021.

Dang. Well, hold on. Hey, Before you do anything, go to a local mechanic that you trust that's not the dealer.

I don't trust them.

Okay. Yeah, they were bull crap enough.

You go to a local mechanic. If it's a transmission on a Toyota and it's a '21, my guess is it's covered somewhere in the power train warranty.

Right. I'm not sure because her grandparents bought her the car. There was a whole situation with her mom.

That doesn't matter.

Okay.

Go to a local mechanic and get the skinny on it. Okay.

Maybe a third mechanic to get another opinion?

Because then they look at it and say, Yeah, this happens all the time with this car, or, Yeah, this is under warranty, or, Dude, you don't have a problem at all. All these cars do this.

Have you checked to see if they warranty the transmission? Because it's newer?

They didn't say... I asked them a ton of questions when I was there at the dealership, and they didn't give me a straight-up answer. I was just asking. I was like, Is there a warranty on this? And they didn't. They were just beating around the bush with me, talking about how I need to get a new transmission.

I would do your own homework on that and figure it out. Because here's the truth. If it's going to take 13 grand to repair and the car is only worth 13 grand, I wouldn't do this. I would sell it for what it's worth, save up some money, and then get a different car. Now, what's your truck worth?

My truck, I took it in yesterday while her car was getting worked on, and they said the appraise value for selling it outright is 19,000, and to trade it in is 22 to 25,000.

How is it possible the trade-in is higher than what it's worth?

That's because they're giving you a cash number. Don't do this business with dealerships.

Don't ask the dealership what your car is worth. They'll lie through their teeth. Go private sale. Yeah, go to the Kelly Blue Book, back to where you were. What is the private party value for that truck? Because that'll tell you the exact difference you're underwater. You owe 36. If the truck is worth, let's say, 25, well, now we know. We have a number. We're 11 grand underwater. That's the gap.

Hold on. What did they tell you the trade-in was?

They told me The trading was 22 to 25, and then selling it was 19.

Okay, that means you can probably get 27 to 30 private value.

You might be six grand underwater. How quickly could you guys save up the difference in order to sell it and have a little bit more to get you a different car.

Right.

Could you share a car for a few months?

Or go down to Fairwinds Credit Union, get a $10,000 loan, pay this thing the difference off, sell this thing, private party, use a couple of grand to get yourself a car that's going to get you from A to B, and pay that loan off. And you've just taken a $36,000 problem down to 10.

Right. Yeah.

Do you guys have any other debts?

I do. It's a few small debts. It's from Syncrony Bank. It's like a $1,000 debt and a $2,000 debt. And then I have one of my credit card got shut down, and it was really my work's fault. So I filed a complaint with the Capital One, which is who I have the car loan and the credit card through.

So what's your total debt balance between the two of you?

She has zero debt. I have, I would say, probably close to $40,000, including the car and those few things with the synchrony bank and my credit card. Okay.

So the good news is if we clear this truck, you guys can be debt free within 30 to 60 days.

Right.

So That's the new goal. Now, the thing is we got to save up the money to cover the difference, or like John said, go to your local credit union and get the difference in a loan so that we can reduce 36 grand down to 10. So that's the game. So you have two pieces of homework. We got to work on your wife's car, figure out what it's really going to cost from a few mechanics, and then we need to either save up for the repair cost if it's going to be worth it, or we need to just sell it for what we can get for it and get a different car.

Yes, sir.

You got It's plenty of work to do, man, and it's very doable. I feel very hopeful about your situation, but it sucks. I'm glad you're learning this lesson at 22 instead of 42. Here's the best news. When you pay cash for a car, you can never be underwater. So never go into car loan debt again. Never lease a car. Never go to a dealership and let them convince you into a payment. You go in there with a check. John has done this. Where he goes in, he's got a check for a certain amount, and he goes, This is how much I have. If you guys want to do business, I'm here. If not, I'll peace out.

I've had them say, Hey, appreciate you. We shake hands and I walk out, and I had somebody take $9,000 off of a car price because I had a check and I said, Hey, this is what me and my wife agreed on before I left the house, and I'm not going to call her and switch the deal up on me. This is a big check. I would like that car. Let me go talk to my manager. Come back. Let me go talk to my manager.

They play the games.

They said, Just take this car and get out of here. I was like, Cool. Here's the deal. I wasn't tied to the car. It wasn't like, This is my dream. It's a car, man. It's awesome. It's nice. I love it, but it's not my identity. It's not my end-all be-all. If that one didn't work out, I was going to find another one. That's cool.

Yeah. That's what I think my wife's situation. Her car is... It's got 80,000 miles on it. Toyota, they can go for a pretty good long time. But her grandparents bought it for her, so I guess she's a little emotionally tied to it. But she's also understanding that the more practical aspect is I'm willing to pay the price. Maybe sometime down the road, then if they wanted to help us on another car or whatever. But she's just, I guess, emotionally attached to it because I have no idea, to be honest with you.

Well, it doesn't sound like it's smart to sell it until you know your situation.

Right.

If you can fix it for three grand, great, let's fix it.

Right. Because they told me, I looked it up and it said that it could be a wheel bearing or it could be the transmission. Then they go in and they give me the highest bid possible, which I expected them to give me the most expensive.

Well, here's the thing. Dealerships make money two ways, financing and the service.

They don't make money when you walk in with a check and buy a car.

Right.

They have a vested interest in getting you to do all of their service. That's why you get a million emails every day like, You didn't do this, or, You need to do this, or, Come see us.

It's time to come in. Time for your checkup.

Take it to a local mechanic. By the way, when you go to the local mechanic, look him in the eye or her in the eye and say, I'm coming here because you're somebody who has a reputation that is trustworthy. I got this information from a dealer, and I want you to check their work because I trust you. Let that be their guide.

Really quick question. What do you recommend? How would I private sell? What's the best way to private sell?

You listed on Facebook marketplace. You pay a little bit, put it on AutoTrader, take really nice photos. I actually did a video on this on my YouTube channel. Just search how to sell car for top dollar. Camel, it'll pop right up. We'll also put it in the show notes. Remember, don't let cars be more than half your annual income. Total, all things with wheels and motors. You do that, you're going to build some serious wealth.

When you're tired of feeling stuck with money, there's just one solution. To get different results, you have to do something different. No one accidentally wins with money. You have to have a game plan, and that begins with our get started assessment. Go to ramseysolutions. Com ramsysolutions. Com/start. Answer some questions, and we'll show you what steps to take next. Don't stay stuck. Take control of your money starting today. Go with ramseysolutions. Com/start.

Our scripture of the day, Hebrews 12: 14. Make every effort to live in peace with everyone and to be holy. Without wholeness, no one will see the Lord. Jordan Peterson said, Face the demands of life voluntarily. Respond to a challenge instead of bracing for catastrophe. Oh, that's good. I think most of us are bracing for catastrophe these days. We're just tightened up, just waiting for life to happen to us instead of responding to the challenge and being a little more proactive. That's good. Maria is in San Jose. What's going on, Maria?

Hi there, John and George. It's a pleasure speaking with you today.

You too.

I have a question. Should I continue paying off my house with the same intensity if I want to retire in the next 5 to 10 years? As I was paying off the debt, I'm completely debt-free aside from the house now.

Cool. Are you single, married?

I am married, but I am the sole breadwinner.

Okay. So at the rate that you're currently paying down the mortgage, how quickly will it be paid off?

The way that I've calculated, it would be three and a half years.

Wow. And this is with serious intensity. Is this over time, no vacations, we're not living or what?

No, I do take vacations maybe twice a year. Okay. And I worked a lot of work time.

Okay. Well, that just helps me because I go, Gazelle Intensity is rice and beans, we're not eating out, no vacations. We say move from intensity to intentionality once you hit baby step six. So as long as you have a happy life, you're going on vacation, you're enjoying your money, you're giving money, you're investing 15%, it's up to how fast you go. Now, John and I, we're crazy people. We're like you. We're like, Let's get rid of this debt as fast as possible.

I went pretty scorched Earth, and I'll tell you, three and a half years is right at the outer limit for how long your body can take.

Okay.

What does your husband think?

Well, currently, he is not here with me. That's why I'm wanting to get this done over with so I can retire and go out of state with him. Well, out of the country because he's not here.

Oh, literally not here. You guys don't live near each other right now.

Correct. My vacations are to go see him.

Wow. Okay, so let me throw a complete wrench in this deal. Why not sell your house and just move there to be with him?

Because my whole family is here.

Okay, fair.

Wow.

Okay, so how old are you now?

I'm 45.

When do you want to retire?

At the latest, I would say 55.

You're able to do that as far as actual nest egg, retirement accounts, all of that?

Well, currently, I do have about 50K in my high yield savings, 40K in my high yield savings. I have total retirement accounts and brokerage like HSA and Roth. I have 256, I believe. I also have a pension plan plan with my current employer.

Okay. And you're saying between all of that and me investing for the next decade, I should be able to make this whole plan work?

That's what I was saying.

And not having a house payment. Yeah.

And then you can invest a portion of whatever that house payment was. I mean, there's nothing wrong with that plan. The only encouragement I would give you is to retire to something instead of from something. Right now, it feels like you're running. And it's a great goal because you want to be closer to your husband. But I wouldn't also work a job that I hate and toil over it for the next decade or whatever. Do you enjoy what you do?

I do.

Okay.

I do. That's another thing. It's like when I retire, I don't know if I'll be able to not do anything.

No, don't. I take it away. You're too valuable to the world. We need you out there.

I want you to have fun. What likely will happen, you'll take them on the vacation and then be bored and be like, I need to do something with some meaning and purpose. I'm going to go start an Encore career or your own business or consult or something.

Or go down to a halftime with your current employer, retire and have them bring you on as a 1099. There's a million different things, and who knows what the world will look like in five years or 10 years or whatever. But I personally, George, tell me if I'm wrong, I love Maria not having a house note in three years.

I'm a big fan of that. I love it. I love it. We paid ours in 26 months, and now it was a very modest townhome. We had a huge down payment. We went hard, but we were young, no kids, and we went, What's stopping We were aligned on the goal, and I look back with no regrets. I don't think you will either. We were just gut checking to make sure that you weren't going to burn out and fizzle out because your life was unsustainable.

Okay. Do you think with my numbers and what I have so far in retirement, that that would be sustainable for me to be able to do that?

I wouldn't be able to tell you on a radio call, I would sit down with a SmartVestor Pro, and you can lay out all the numbers and what your current investment rate is. They have the most high-tech software where they can plug it all in and show you exactly what will be true and what life you can live and when. And so jump on ramsey solutions. Com, click on SmartVestor Pro and lay it out with a pro. And you can use our investment calculator and ballpark some of this, but there's so many variables that you forget about, like health care. Well, that's going to cost a pretty penny when it's not through your employer, especially before you can access Medicare at 65. So that's a whole another range in the plan. That's going to be 36 grand a year we got to cover for health care as one example. And then what lifestyle you want to have in retirement? Are you going to live real simple or do you want to go crazy? And they found what happens in a retirement is it's a smile shape. And so at first, your spending actually goes up.

It's a little dimple there. Then what happens is over time, your spending actually goes down. As you settle in, you travel less, less vacations, less excitement. Then as you near the end of your life, the expenses ramp back up as you enter health care, long-term care costs, and all of that. And so it's not a straight line where you go, Well, can I live off five grand a year for the rest of my life? I wish it were that simple, but life is more complicated. And that's where a pro can really help you unpack all of those variables. Thank you so much for the call. It's exciting. To be debt free in California before you're 50, that's a miracle. Jr is in Atlanta. Jr, how can we help you? It's a sad ending, JR. Are you here? Yes, I'm here. There we go. Okay, get right to your question. We're up against the clock.

Yeah, so I'm 24. I'm going through college, and I'm trying to earn a degree that will make me the most amount of money in the quickest time frame. I don't enjoy the feel I'm currently in, but my goal is to chase money and then figure out what I want to do after it. Is this the right mentality?

Yikes.

No, it's backwards.

Okay, so- Now, here's the thing. We don't need to conflate the two. I think you can hustle and work really hard at something you love, and that is the recipe because you'll never get bored of that. I would not do something I hate and get a degree just because I think it will pay well. You meet a lot of those people. They're not happy.

Miserable billionaires.

And they never go, Well, at least now I can do whatever I want. I've never met someone who said that.

Okay, so here's my counter to that. My counter to that is that, let's I have a passion in art creation. I like to paint or whatever. To be honest, that's not starting the most paying field. So my mentality, and honestly, my advice that I give most other people is that And then, screw what you enjoy per se if it's not making money and just go to school for something that's paying. For example, I'm about to get my degree in December for software engineering. Right now, I'm a software engineer team lead. I don't, per se, enjoy the job, but in terms of financial, I'm happy. I'm going to use the money later on to then fund whatever I enjoy.

My pushback would just be this, simply this. A, you're right. There's a reality. I tell everyone in their 20s, just be quiet and grind it. Go grind it, right? But grind it towards the person you want to become. And so there is a big difference between I just want to be a painter and I don't make any money, and I'm a person who's creative. I help create beauty in the world. I help people create homes. I'm an architect. I don't love Architect isn't my first love, but it allows me to be creative. And when I get home, I get my ESL out and I paint. You know what I'm saying? There's a big difference. Work really hard, grinding it out. Of course, that's part of it. I'm glad you have that ethos, but become the person you want to become the person you want to become, because, man, I know a lot of miserable, lonely, wealthy people, and I wouldn't trade places with them for anything.

I'd reverse it if I were you, man. That puts this hour of the Ramsey show in the books. Remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.