Transcript of We’re $100K in Debt and Living in a Camper

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Normal is broke and common sense is weird, so we're here to help you transform your life. From the Ramsey Network in the Fairwinds Credit Union studio, this is the Ramsey Show. The phone number to jump in today, 888-825-5225. 888-825-5225 alongside the really, really sharply dressed George Kim.

I always like to see what adjective you're going to use on me today.

I appreciate that. I got distracted from the agenda. I was looking at that shacket. That's a well-appointed shacket, George. Thank you. As always, I'm Ken Coleman. We're here together for you.

Looking good as half the battle, Ken.

It really is. You're prepared as well. All right, let's go to Travis in Huntsville, Alabama. Travis, how can we help today?

Hey, I am in $100,000 a day, and I'm 22. I have two kids, but I make about $70,000 a year.

Okay.

Tell us more, what debt is $100,000? Break it down for us.

Well, the first one was my, I guess, my 20-year-old idiot purchase, which was... At the time, when I first got it, it was about a $75,000 truck from a loan rolled over. Now it's about at 60,000. I pay 1,200 a month on it. My second one is a $23,000 camper. Started at 30,000. Pay that about 500 a month on it. And then the last one is a car for my wife, which I currently owe about 16,000 on.

Okay. And what is your goal today? What's the heart of the question?

Well, I guess So me and my wife have been talking a lot about getting rid of the truck, because the reason we have the camper and the truck to begin with is because we were traveling on the road. I did just... I worked for a renovation company, doing renovating government buildings, made a lot of money the first year, contracts died out, just slowed down, had to find another job back home, where we had a little more stability. But we still live in the camper, and then the truck is is the way to move the camper around. Got it.

So you're living in the camper full-time? You're not renting, you don't have a home? Yeah. Okay.

How often? We're not renting. And we actually don't pay for rent at the campground because we volunteer for state parks.

Cool. So that covers the fee. They make it a wash.

I'm guessing you don't move around much anymore. You're not moving this camper much.

No, not very far. Just around an hour from Huntsville. Right now, we're an hour, so we're far, but we can move back in a couple months.

Okay. And your wife is at home with the kids? Yeah. Not working outside the home? Okay. So 70K is what we're making. We've got 100K in debt. Have you looked into what the truck is currently worth, what the camper is currently worth, if you sold it privately?

Yes, sir. So the private value on the Kelly Blue Book website is 36. So it's just really underwater.

So 24 underwater on the truck. And then what about the camper?

The camper, I don't know how much they depreciate. Honestly, I haven't looked into it.

They depreciate a whole lot. That's for sure. You think it's worth 10 or 15? 20?

I might be able to get 10 out of it, and that would leave me a 13.

So total, doing the math, you are $37,000 underwater on these vehicles. Meaning you cannot get rid of these until you come up with the difference somehow to clear the title. Yes, sir. There's two ways you can do that.

I have a question. As I'm listening here to George talk with you, have you run the numbers on the most affordable rent? Because you're already living in a trailer. So you make 70,000. It's not chump change. What would rent cost you?

There's some places where I think we could get it for a thousand, but some of those places with kids, I just wouldn't feel safe putting them in. I know my wife would- Okay, but you went to the worst common denominator.

What I'm asking you is, I would never recommend you put your family in a place where your kids are unsafe. Let's reask the question, what does rent look like in a place where you don't feel like your kids are under threat?

I would say maybe somewhere between 14 to 1,600.

Okay. Have you run a budget on what that... What would that do to your budget with your take home?

Yeah. I get 5,000 a month. So that minus the car payment would be, say we had 1,500 rent, I get three grand back a month, including expenses.

The reason I'm walking through this with you, Travis, George, I mean, I wanted George to hear that ratio. But the reality is, you've got to get rid of this trailer.

You're essentially paying $1,700 right now for rent.

Yeah.

Because the trailer Truck and camper are sinking.

The camper is losing value. That's why I want you. George, is that too aggressive? I'd like for him to, let's find a place to live and get renting and let's get rid of the camper.

Because if you sell the camper, you lose your housing. We've got to solve for that problem. The good news is the truck can go sooner because we don't technically need it right now. That's true. The issue is we need that money, either through savings, through a future income, or through a loan from your local credit union. Is your credit good enough to get a loan from a credit union right Not really.

Like I said, when we were out of contracts, I was out of work for about six months in Seattle. And so I went. It was just a couple of months of trying to get unemployment just to stay above water and knock doors.

But that didn't really- Do you have anything in savings right now, or anything you could sell?

Anything I could sell? I don't really have anything I could sell, per se. We have a camper, so we live minimalistic as much as possible. I don't really have anything in the camper, besides Hobby Lobby artwork.

And nothing in your savings account, correct?

I have a little bit. I'm working on Baby Step One, I believe. It's getting a thousand Correct. And the think out, so we have maybe 300. And then I have a couple of Roth, two Roth IRAs and 401k, which I'm not going to touch. Good.

Okay. Well, you're speaking the right language here. We got to get the thousand bucks first. Then we need to solve for this truck because that'll free you of twelve hundred bucks a month. And so even if you take out a $24,000 loan, it's better than what you got right now at 60K. And so that's your next goal once you get the thousand bucks. And that's going to take some time. This is not going to be like, Hey, we can just go do all of this tomorrow. But you're going to need to explore all of your options and try to get top dollar for these so that you can get out of this faster. And that might mean you're working two more jobs.

Yeah.

That's not going to be fun for the next year or two to clean this up. But that's the only solution I'm seeing here to get you out of this without dangerous shortcuts.

Yeah, I'm just going to reemphasize Travis. The first step here is you've got to find a place to live so we can sell the camper.

Yeah. Do you have any family nearby?

We have some church family, but we wouldn't be able to stay with them long term. All my other family is same, same deal, not Not really fit, so it's stay there. One factor I didn't mention that I've been thinking about is my old boss, he lives here in Alabama. He lives fairly close, and he has offered to any time I need to move the camper, he would let me use his truck for that. The one thing I would worry about, he's very dependable and reliable, but you never know what's going to happen. He could move, it could be broken down. But I was thinking if we take care of the camper, we could still be able to live rent-free, essentially, if we can have the camper paid off.

I think this is just... We're still in short-term thinking now. We got to think about the bigger picture and getting out of this life we created, man.

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All right, Marie is up next in New York City. Marie, how can we help today?

So I have a question in regards to parent plus loans, and if I should pause on paying them because my children are still in school, they are technically not due yet. But I've been paying the amount that they said I would owe. But I do have credit card debt, so I'm wondering, do I put a pause on paying the parent plus loans because they're not technically due yet, and take that money I was paying to that and that towards my credit card debt to get my credit card debt to go down faster.

Is that the only debt you have is credit card?

I have a small car loan that I pay $240 a month towards, and I probably owe about $3,800 left on the car, and I have $7,200 in credit card debt, the parent plus loans, and I have a mortgage that has about $150,000 left on it.

Okay, great. Are you familiar with our baby steps?

Yes, I have $1,000 saved. Okay, great.

All right. And what was the total amount for the parent plus loans?

$65,000.

Okay. And I'm assuming that's broken out across some different loans, or is it all one giant loan?

No, it's two children, three different loans. Okay. Or four different loans, maybe.

Great. So this would still fall into your debt snowball, regardless if they're asking for payments or not. Because here's the truth, the interest is still accruing. And so the more we kick this cane down the road, the more that balance is going to balloon, you're going to wake up to have a $65,000 loan. And so this would just fall right into your debt snowball. So list out your debt, small to largest. Is the credit cards, is that multiple cards to make up the 72?

There's two cards, yes. Okay.

So like a few grand each?

Yeah, there's two cards. One has 4,700, and the rest is on the other one.

Okay. So this becomes pretty simple. We're going to knock out that first credit card, then the car payment, then the second credit card, and then start attacking these parent plus loans.

Okay, but still keep making those- Make the minimum payments that they offer.

Is there a minimum payment that you can pay? It's just not required?

Correct. They originally had said, Oh, if you started paying today, you should pay this and that. You should pay 305 a month. So that's what I've been I am.

Good. I would continue down that path and just keep doing minimums on all of your debts, except the smallest one, and attack it. Because I'm looking at all of these debts. Are you close to 70 grand in debt right now Without the- Without the mortgage? Yes. Okay. And what do you guys make a year? What's your household income?

I make, I have two jobs. I make 110 between both of them.

Fantastic. Well, there's some good news. So we can clean this up pretty fast. I mean, if you can throw, let's say, 35, 40 grand a year of your net income towards this, you're done in two years.

That would be amazing.

That's it. I think part of this, Ken, it's hard to just Peel back and look at the big picture versus just staring at all the variables and deaths in front of you.

Well, let's talk about the big picture because you just hit her with that, 35 to 40,000 a year. It's almost like, Marie, we could hear that you were stunned by that. You laughed and said, That would be nice. Let's talk about why we got George with us here on the budget. He's the budget guru. Is that believable to you? It felt like it was almost unbelievable.

It's a little unbelievable because I feel that I work really hard. I have two jobs, and I listen to you guys and what you say, and I've been doing the debt snowball, so I just got rid of one credit card last week. That was a little celebration, yay. My mortgage, I only owe 150, but my mortgage takes $2,200 a month.

Okay. That's why I wanted to lean in because George has taken a shot there. But let's say, George, we use your number of 35, that's just about 3,000, a little bit less than 3,000 a month net. So realistically, Maria, if you are very disciplined, to the best of your knowledge right now, what do you think you could put away every month with the two jobs.

So making minimums plus the extra, what could you throw at all this debt?

I usually, and I hear you, and I think you are probably right, but it almost sounds impossible when you're sitting on this side. Because I do pay $1,000 to the credit card, and I do work extra or overtime at the first step.

Well, that's why That's why I'm pushing in a little bit. I wanted to see if it is doable. What is the most money you could commit? We're not holding you to this. This is an exercise while we have you. What do you think is the most... I'm talking like extreme Budgeting, saving, cutting expenses everywhere. To George's question, after you pay the minimums and your four walls, what do you think you could put on debt every month? What number?

I probably could put $1,000 a month.

On top of your minimums is what you're saying? Yes. Okay, great. Because I'm doing the math here. 27. 50 gets you out of debt in 24 months. If you're doing all the minimums plus the extra, that should add up to 27. 50. Now, two years, I'm just throwing something out there. On average, we find that people who follow our plan to a T, we're talking baby steps, budgeting using every dollar, making the sacrifices, 18 to 24 months is the average. Based on the numbers you threw at me with your $100,000 income, 66 grand in debt, you are right there. That's going to be 18 to 24 months of sacrifice. At first, you're going to feel like you're not making progress. But I'm telling you, month after month, in six months, you're going to have a few debts knocked out. Think about that. You free up the payments. Now we're throwing it at the next debt. The snowball starts to roll, and by the end, you can see the light at the end of the tunnel.

I love it. How about we just... That was a great locker room speech, George, even though you never played sports.

I don't think I've been in a locker room other than me getting bullied in one of my meetings.

What if we give her Breaking Free from Broke? Because I think that's a mindset book in her situation. You like that? Absolutely. That's your book.

Yeah, that'll get you fired up about your debt, give you the path out in my voice. There's a lot of jokes in there because you got to have fun along the way, Marie. What you've created right now is not fun. Taking on the parent plus loans, which is a noble thing to do. You want to help your kids. But here's the kicker. That debt is in your name. The kids don't legally ever have to pay a dime, and the interest rates are higher. These are not going away. Even if the payment is deferred, the interest is still accruing, and it is brutal.

I want to do a follow-up on behalf of our larger audience, okay? Because for the minutiae, sometimes I want to make sure people get the principle. In Marie's situation, you told her to continue making what the minimum payments would be, even though that they're not asking for that money right now. Why would we give that advice as opposed to saying, Do the snowball on everything else but that? Why that advice, George?

Well, if you're not making any payments at all and the interest is accruing, you've got a double whammy situation. That's right. Because you are not moving the needle at all with the principal. And so the only thing moving the needle is the interest adding to your balance. We hear those stories because people, they weren't taught how interest works, especially when you're not making a payment. If you go punch the numbers into an interest calculator, you will find that balance will balloon. Who knows how long they'll be in school? What if they're in school for another six years? You've got to just start creating the habit of knocking out this debt systematically The debt snowball method is the way to do it. Just ignore the interest rates because the way you're going to hack this thing, the interest isn't going to add up that fast over the next 18 months.

I thought it was interesting to hear her brain and her reaction. It was really fun to hear that, wow, that would be nice. When we pressed in, right now she's thinking $1,000 a month. I got a hunch, and Marie's still on the line. I think she could get more than $1,000 out of that budget. What do you think, based on your experience?

If you take 110 grand minus your taxes, and you're going to Now is all investing. You're just going to pay your health care if that's through your job and all that. But whatever comes home, that's your number now that we've got to figure out. You got 2,200 in your mortgage. Okay, whatever's left, how little can we live on to throw as much as we can at the debt? So four walls plus insurance, anything else, that can go. Everything else is a luxury at this point.

That's right. Kudos, Maria is working two jobs, folks. This is a superwoman here. She's hustling. In this case, you're looking to sell everything you can possibly sell. What if you can sell five, 7,000, maybe as much $8,000 to $10,000 worth of stuff. That again reduces that timeline. So again, we have a lot of new people joining us all the time and trying to understand the practicality of these steps. Listen, we didn't say it was easy. The steps are simple, but the work and the sacrifice is hard. But boy, oh, boy, you heard how she reacted when George said, I think it could get out in 24 months. That's exciting stuff. The quicker you get out, the quicker you move on in your life with the dreams that you want to achieve. This show is sponsored by Better Health. Sometimes it seems like everyone else's love life is this perfect little hallmark movie. Here's the truth. Married, dating, or single and trying to figure it out, everyone is wrestling with what it means to be in a relationship. I've been married for 23 and a half years. I've got a PhD, my wife has a PhD, and we have all the answers, and we're still trying to figure out how to keep our marriage on track.

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You can do all of this by going to ramseysolutions. Com/smarttax, ramseysolutions. Com/smarttax. All right, Charlotte, North Carolina, is where we go next. John's got some type of a family issue here we need to talk about. John, what's going on?

Hey, guys. Thanks for having me on the show. Sure. My wife's mother and sister, not as well off financially as us. We're coming up in our own financial journey to a point where we may be able to help them, but we're having an issue when we talk about it, and Please, I don't want to paint them in a bad light. I love them. They're great people. But in a lot of aspects of their lives, they are very much... We can't right now because people. You wouldn't understand because we've got three kids, you don't, that thing. What is something that we could do when we get to the point that we can, that we could help these people that we're not crossing the boundaries, but we're also not enabling bad financial decisions?

Okay, well, you answer that question. Is There, let me flip this on. I'm going to set you up. Sorry. I didn't mean to just- You answer. No, you called us. You tell us. No, here's what I want to know. You've already laid out, George and I know exactly what you're saying. You're not in any way attacking them. However, here's my That's a good question for you. Let's just fast forward into this future that you just mentioned, where you are going to have some extra money. Is that me understanding correctly what you're saying?

Yes, sir. We're about $38,000 down, and we got about 30 to go.

No, I know. Don't worry about that. We're going to fast forward to your heart of your question. Okay? Let's fast forward to this future where you have some margin to where you could help them financially. In what area would you feel confident telling George and I, I helped them, forget about the number, but I helped them how I could, and I feel like this help will actually make a difference. Tell me the answer to that question. What area where you could help would actually make a difference, and they wouldn't squander it, and they wouldn't just motor through it. Where could you help them where it would make a difference?

The biggest thing that we've discussed that I think could possibly work is if we were able to pay for a year of childcare for their kids so that mom could to work and help them financially because dad is limited in his position with what he could make.

Okay. If you were to do that, A, would she go get a job? Yes or no?

I couldn't tell you. I think so.

And what if she doesn't? Is it conditional where you go, Hey, you got to show proof of income?

Well, I don't like your answer, John. You realize what I'm doing here? I'm walking you through, is this a good ROI? Why? And your answer to that was, I don't know if she'd actually do it. That's a bad sign. True or false?

True.

You see, so this is how I would come about this. My heart says, I want to help, but I need to put real plans, real specifics together, and I just walked you through this. And the first thing you said that you would do to help, there was no certainty at all that it would actually help? Because if you pay for childcare, but she doesn't go get a job and thus get extra money, and then we didn't even ask you, even if she made the extra money, do you think that she would put it towards removing debt? What's the answer to that?

I think so. They've been watching our financial journey, so hopefully we've been just hoping that they would see what we're doing.

Have they asked questions? Have they even said they want help, or is it just more, well, that's for you guys, but that's not a thing that we're going to do.

Yeah, I think that's true, George, because we've offered them financial peace because we have it. We're actually waiting to start it because we want them to go through it, and they've had it and haven't done it. We're getting frustrated because it's like, I want to help you. Let me help you.

Right. But, John, you just said a moment ago, until George refrained that, you said you thought that they would use that income of hers to help themselves. Now you're questioning that. You see, this is the exercise, and I'm glad you called us because we can be objective. We're not related to them. It sounds like to me that this is a bad investment.

Here's the underlying fear. You don't help them move forward. They just get comfortable for a while while you get super resentful because you're helping them and you're really putting yourself out there paying for childcare for a whole year, all for them to not make any progress. Well, now the relationship's gone. You've lost all respect for them. Mm-hmm. Until they are at a breaking point, until they have enough pain in their life that they're going, I guess we should put on that financial piece thing. We are running out of options here. I don't know that they're ready for it yet.

I agree. That reminds me, George, the old phrase when the student When the student is ready, the teacher appears. This is tough with family. George, I don't know where you're at. I'm going to say, John, I would not help until they say that, A, they want help, and because they acknowledge they need help. I think those are your two boundaries. Again, I would run through a similar exercise like I just walked you through. My friend, you answered your own question. I know it's a tough situation. I hate that, but you guys got your own financial journey. You got 38,000 to pay off. Let's go walk the baby steps, continue to do what you've been doing. Let's get out of that situation. Make your life better, and let the chips fall where they fall with other people. Let's go to Jonathan next, who is in Fairfax, Virginia. Jonathan, how can we help today?

Hi. Long-time listener, first-time caller. My dad, actually, he's really a big fan of the show. Right now, I got a little question about how to find housing at my current stage of life. I just graduated college about two years ago, and I've been working as an RN for about a year and a half. I'm about to get a raise, and I'm still looking around, trying to find good housing without breaking the bank and just being able to save continuously after It just seems like a really big struggle for me right now.

Give us some real numbers. I know the Northern Virginia area. If you're in Fairfax area, I know that area. That's an extremely expensive place to live. Give us the numbers for George and I, what you're looking at for a rent.

Honestly, I'd take really anything. I'm really trying to reduce my commute as well, though. And in the Fairfax, Fair Oaks specific area, which is where my hospital is, it's around 1,500 at base price. As far as I've seen, I've asked a few realtors, but it comes to about there.

What have you been paying in this two years since you've been out of school?

I've actually just been staying at home. My dad's very gracious. He's allowed me to stay at home for $200 a month. But additionally, a few other utilities in there.

What's your income now? You also told us that you're about ready to get a raise. Give us those two numbers, where you are now and then what your new raise will look like.

Right now, I believe it's 90 a year. Further than that, in about a month and a half, I think it goes up to probably '93, '94.

That's awesome. Do you have any debt payments?

I do not, no.

And you're worried about $1,500 a month?

Just a little bit, but- Well, compared to 200, sure.

But that's a false reality.

Yeah, George is in the middle of this stuff. George, what do you think about 1,500 a month for this guy?

If you're taking home about six grand a month, 1,500 bucks is right on the mark. We tell people 25 % of your after-tax income is what you want to stay in for housing, whether it's rent or a mortgage. Okay. And here's the other thing. That's for you living alone, right? Yeah.

Here we go. Tell him, George.

Can I tell you? I don't want to pull out like I'm a pioneer woman or something, but I had roommates all the way up until I was married because I couldn't afford an apartment on my own.

You can, but we've already established you could afford it. But to George's point, if it gives you stomach problems, fine.

If it's two grand for a two bedroom and Now you rent a thousand bucks, you'd feel a little better, wouldn't you? And you're splitting utilities as well.

I definitely love you. I could find something, but you're right.

I mean, Facebook groups all over for roommate finders and apps and ask around to your friends. I mean, you got young guys you work with, probably. You got to put a little effort.

You know where I'm at, George, on this? What's that? You've proven that he's fine financially. He's got a great upward path. He's doing great. He's got no debt. You know what? This is quality of life. Jonathan, I think you got to focus on much life is going to be better not commuting way out into Fairfax. I know what that traffic is like.

But it's scary to fly the coop, Ken. He's comfy.

But once you start thinking about not driving in the seventh level of hell every day, there's a really nice trade-off. Life is about trade-offs, George.

That's right.

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Com. Use code Ramsey. All right, let's go to Cathy, who's joining us in Minneapolis. Cathy, how can we help?

Hi. My husband refinanced our car, and now we have a 25% APR, and I'm wondering what we should do.

What caused this refinance?

So we had- What was the original APR? The original was 14, and he was trying to money to pay some things and decided to take out 3,000 on top of the car loan. And that's what happened.

Yikes. Why would he do that inside of the car loan? There's so many ways to get 3,000, even though it's a terrible idea to go into debt for any of it. But why refinance the car loan to get three grand out?

I think because it was the... Well, so he had originally applied for a personal loan, but his credit wasn't very good. And so, They told him that he could do it through the car loan as a secured, I don't know.

Yeah, it's a secured debt. He didn't involve me in the process. And so they go, If this guy can't pay, we get a car out of it, so we're willing to do it. Oh, and by the way, his credit shot, so the APR is 25% because he's a risky borrower.

I want to dig here because you laid it out for us very clearly, and you said, What do we do? Is we involved here or is it just you? Because it sounds like he made a really desperate move.

Yes, he did, and it is we involved. But, yeah, I wasn't included in that decision.

Yeah, but he's now going, Okay, I screwed up and I need some advice.

Mm-hmm. Okay.

All right. Any other debt? Because that helps us with this answer.

Yeah. We have a credit card debt, student loan debt, personal loan.

What's the total of all the debts?

It's about... Oh, gosh. Just under, let's see, 70,000.

Okay. What do you guys make a year as a household?

About 70,000.

Wow. Are you guys both working full-time?

No, I'm a stay-at-home mom.

Okay, so he's pulling in 70.

Yes, and 13 and one for the ages.

You just got restarted It's all right again.

Yes.

All right. I have to ask because I think this is this level of intensity. Are there any type of skills, work experience that you have that would allow you to do some work from home? I know the one-year-old, that's a full-time job. Don't want to minimize that in any way. However, you got 24 hours in a day just like everybody else. Is that even possible? And what do you think you could do to make some money?

Yes, it is possible. I actually I just finished school, so I'm going to be pursuing something, hopefully from home. I also home school, so there's that as well.

But I- Is that going to be possible if you're working full-time outside of Probably not full-time.

I'm hoping to find something part-time from home.

What's your degree in? And what will the job be that you're hoping for?

Holistic wellness, and I'm also certified in personal training, so something with personal training and health and wellness.

So like your private coaching for nutrition, wellness? Yeah. Okay, all of that. That's a little more flexible. You can do that on your own schedule.

Well, I will point out, you have to go get clients. That's a whole different ball game when you're doing it for yourself. I'm going to just point that out that that is difficult. Not saying you can't do it, but I would give yourself some realistic goals. If in a month or two or three months, we're not signing up any clients, not getting anybody interested, you need to work for somebody else. That's just a reality right now. You guys got to bring in more income. Do you have any savings at all?

No.

What's left on the What's the balance after this refinance?

He just refinanced it. It's sitting around, I think, 17,000, 18,000.

Okay. What is the vehicle worth, private party value?

$7,200.

Okay. So we're 10 grand underwater. So there's our number. If we want to get out from under this 25% APR, which is going to cause the balance to balloon if we're not attacking it, then we need to get out from under it by creating this 10 grand, either by saving future income or taking out a loan from a credit union, which I'm guessing is not an option because he's tried that and his credit is shot. Is your credit shot as well? Are you tied to this? No.

Okay. No, I'm not. I was on the original loan, but when he refinanced I was taken off, I guess.

Okay. I would see. Now, it's going to be tough because you don't have income. I don't know if they'll look at the whole picture, if you're the one taking out the loan in your name, they're not going to allow them to be a cosigner, I don't think. But if you can go to your local credit union and get a loan for the difference, that at least gets you out from under this. Is there another vehicle that you guys can use right now?

No.

This is your one car?

Yeah.

Okay. Well, the other option is you attack it with a vengeance. I mean, having Having an $18,000 worth of vehicles making 70 is not the problem. The problem is the behavior that got us here, adding to the pile, going back into debt, crazy interest rates, a lot of desperation. It sounds like a lot of this was done without any teamwork. It was just him on his own out of desperation, and you were an unwilling accomplice? Or did you know about all this?

No, I didn't know until after it was done.

So the new loan, George, is 17?

17, 18 grand left on the loan at 25 %.

All right, so what does he do for a living?

He drives garbage trucks.

Is he handy?

Yeah.

I'm telling you right now, he's the one. Now, you've already said what you were going to do. If he were on the phone, be going, Hey, buddy, you did this, you ought to feel a massive burden. I'm sure he does. But outside of driving that garbage truck, if he's handy, he's working in a warehouse, he's doing whatever he can, 25 an hour, whatever he can do.

He can haul just for people in the neighborhood.

I tell you what, the one-year-old needs you, and I say this not knocking him, but saying this as a father of three. For the next year, the one-year-old doesn't really need him that much. He needs to be working. The truth is, he doesn't even work for a year. It's like I would be circling $18,000 if I were your husband, and I would be going, How quickly can I make $18,000 outside of my $70,000 job? George, that would be my intensity. You agree, disagree on that? Yeah.

I mean, does that change us their life initially?

Gets us out from underneath that massively bad loan that's just putting them in quicksand? Yeah.

When your debt is the same as your income, I see there's a big problem here. Now, if your debt was 140 grand and you got 70, we could solve this within 18 to 24 months. What that tells me is we need to get aggressive getting this income up. That might be him getting two more jobs. That might be you getting a full-time job. We put the kids in school, daycare, whatever we need to do right now to solve this crisis. That's what it is. It's crisis. That's right.

But, Kathy, you guys can't get out of this. But it's both of you. It's two points you want you to walk away with on this call. Both of you have to work more and make more. Both of you have got to be super aligned on a budget that allows for no extra spending on anything other than just the four walls. You got it?

Got it.

You up for it?

Yes.

Okay.

Game on. Because this is doable. George What's your calculation if they were to do that? I know you don't know numbers. If they get the income up, they can do this in two and a half to three years.

If they stay status quo and try to do it with their current income, I think this would take 4-5 years. The balances would just grow with this level of… I mean, the credit cards are high interest, the car is high interest, and who knows about the personal loan and student loans. But there's debt surrounding us right now, and so we've got to get on that debt snowball. We've got to get the spending down. We're going to make some deep sacrifices right now.

In This is your best-selling book, Breaking Free from Broke, you write a lot about traps. Of course, you coach, you sit here and co-host this show all the time. I think this is important. What is happening? What is the emotional trap that causes a guy like this to take such a crazy, desperate loan for only $3,000? What is happening? What do you know?

Well, it starts with, I can afford the payment on this one thing. And while the student loan does an investment in my future, and while the person We'll knock that out fast. It's a lot of good intentions, and they're a little bit delusional and starry-eyed about the fact they can carry this. Then a spouse wants to stay home, and they go, Well, yeah, that's a very noble goal. You got to stay home. We'll figure it out. Then desperation leads to refinance in the car loan. It's not one thing. It is death by a thousand cuts that got us there, and it's death by a thousand cuts that's going to get us out. It's much easier to go into debt than it is to get out. That's the hard truth. The dealership will always be happy to refinance at 25% APR. And so you're going to have to hustle. Both of you need to be a team, maybe for the first time in your marriage, to clean this up.

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Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. Alongside George Campbell, I'm Ken Coleman. Excited to have you with us. The phone number to jump in today, 888-825-5225. George, take lead on your money questions. I'll take lead on your winning at work. If you're feeling stuck, a lack of balance in your life, feeling burned out, that's going to affect all your money stuff, too. We can combine any of those calls. We'd love to hear from you. Let's start it off with Sabrina, who joins us in Atlanta, Georgia. Sabrina, how can we help?

Hi. Thank you for taking my call. I'm a single mom. I had a retirement and a home, and got scammed out of my retirement from my ex. He said I could make more money on investments and stocks. He was able Let's do that, and I pulled out 85K, which, of course, I had to pay a penalty. I'm 54 years old currently. Now, I'm basically starting from scratch. I have them. So I have my home, so I have some money saved, and I'm just trying to figure out where I need to go from here. I do have a special needs child, And I just want to make the right decisions going forward and really building for my retirement because I am 54.

How much do you have saved off of the sale of the home?

So I had to pay a lot of debt back because my ex was a squatter for a year and a half in the home. So 35,000 in a CD. If I dumped that in a CD, that matures in March. My high yield, I put $10,000 in a high yield savings account. And then in another savings, it's $1,200. And then I have some debt.

How much debt do you have left?

So, 6,500 in credit card. My car, 13,000. It's worth 10,000. I got it during the pandemic, so it's a little upside down.

I also have- Before we go forward, what's the car payment on that?

486 a month. Yes.

Let's stop right there.

It's 96,000 miles, and I've already In the last year, I've dumped $8,500 in repairs.

Yeah, but I mean, that's a car that... I'm going to jump in right there, George, because of the money she's got in savings. If we could pay that off, that saves you $486 a month. Immediately, you would feel that. Yes or no?

Yes.

Okay. Keep going on the debts, but I just wanted to jump in. That is low-hanging fruit because you've got cash today to pay that off. George, you don't have any problem with that, do you? No.

I like that move. I mean, the CD is maturing in March. So today, you can knock out the credit cards with your high-yield savings. Okay. And then as soon as it matures, I would use 13 grand of it and knock out the car. What else do you have?

I have an attorney's bill for 10K.

Okay. Anything else?

I have a term life insurance. I only I pay 360 a year. It ends in 2031, and it's for $200,000. So I didn't even know if I should even stop that.

Do you have any kids? You said you're a single mom.

I'm a single mom, special needs child, teenager.

Yeah, you're going to need that money. If something were to happen to you, I mean, even though it's 200K, that's still money that can be used to help take care of your child. And eventually, you're probably going to need a special needs trust.

Well, that's part of the 10K. Okay. 5k for the attorney is for the court case that I had or have currently. And the other 5K was to hire a wills and trust attorney to set a trust and will. Because I need to protect my son. And that's a priority for me right now.

It should be. I love that. You've got term life insurance, you've got a will and a trust. You're doing some good things here. And the good news is, do you have any other debt outside of that? I heard the three. No. Okay. So you've got 30K in debt and you've got $45,000, essentially liquid. Yes. Have you been debt free in your adult life?

Before my ex, yes.

So why don't we call this a new slate and say this is post ex Sabrina. She's starting a new chapter. She's got a lot of life ahead of her. We're going to go into this thing completely debt free, with $15,000 in the bank. You hear me?

Okay. Yes.

Now that we have a foundation, now we can begin investing for the future and rebuilding what we've lost. How sure are you that that money is gone? Did he spend it? What did he do with this money?

Well, I can't get that answer because I tried. And as soon as I stood up to get an answer, it became from, Oh, I went into stocks. Oh, no, I went into real estate investments. Now he's telling the attorneys that I agreed on putting it in a business, and that business went defunct. But I'm dumping money to get discovery, and it's not happening, and I don't want to dump any more money on the attorneys when I know I have to take care of it.

If this is a loss cause and this guy is a piece of work, then I would move on and just start investing with your current income. How much are you making a year?

I had to take up a W-2 to to stabilize in the last two years of this or cases. So I make 50K gross with the W-2. And then I have my own business that brings in 75K in gross, but I only pull about 20 to 30.

Okay, so we'll say you make 80 grand a year?

Yes.

Okay. So you will be in Baby Step 4 if you follow what we told you. Pay off the debt, park the 15K, call that your emergency fund. Maybe you want to add a little to it to get to three to six months of expenses, maybe six months since you're a single mom with a special needs kid. But 15%, that's 12 grand a year you would be investing. We're going to do a thousand bucks a month from 54. Likely, the truth is, you're going to have to work longer than you wanted to, right?

Mm-hmm.

To maybe, let's say, 68 or 70. Is that fair? Okay. You're starting with zero in retirement, correct?

Yes.

Okay. You could have over half a million dollars from 54 to 70 investing grand into mutual funds inside of retirement accounts.

Okay. I'd love to know more about the business. You said you're grossing 75, you're only taking out 20 to 30. Does that mean that you're stocking away what we would call retained earnings, or that's all you have to be able to take out as a net?

Well, I'm a little funny on those numbers, just so you know, because I'm new in the business. It's like my a year in the business. I do owner draws that are not consistent.

Is the business fairly healthy, though? What I'm saying is, is it mostly profit Is it profit for you or is it running really tight?

It's mostly profit for me because I don't have overhead.

What's the business? Tell me in five seconds. What the business is.

Professional Home Organizer. I help people declutter and organize.

Isn't that fascinating? You're the professional organizer and You don't have a grasp on your own numbers. Get yourself a good bookkeeper. I'm not chastising you, but I am saying you have it in you. You want to know those numbers because I see a great path. The reason I'm asking these questions is as you grow that business, George, I see tremendous potential for you to grow. Scale that thing? To scale it, pay yourself more after you run through the advice George gave you. But this is an opportunity to play catch up. Get a good tax pro. Go to ramsey solutions. Com.

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All right, Brandon is up next in Oklahoma City. Brandon, how can we help you today?

Hey, first of all, excited to be on. Thank you guys for having me.

Sure.

Okay. Yeah. So I'm in an industry, I'm in the oil and gas industry, and the job volatility in what I do is it's up and down a lot. I'm on step two Pay off your debt using the debt snowball method. But I already have three to six months of expenses set back in savings, and I'm ready to start paying down on some of the debt outside of the mortgage. I'm just having trouble taking that leap because I've been through this cyclical thing of working for a couple of years, and then the oil and gas market dies, and you lose your job for a year, and then it comes back, and you make good money, and then you lose your job I'm ready to jump in, but I just wanted to know what you guys take was on it and how you think I should move forward in that situation.

Well, I have a question first before George coaches you on what to do. This has happened to you before in the oil and gas industry, this idea of where everything's hot, making great money, and then the market changes, I'm guessing. This has happened to you more than once or just once?

This is my fourth run.

Okay, so here's my question for you. What would need to change? What would need to be true, having weathered this before? If this happens again, what would need to be true? What would the new reality need to be to where you could weather that storm? You tell us.

The new reality would need to be... I think we would need to be paid down to where it was just our mortgage, and it would be a lot easier to survive in between those and or move on to something else and not get in and out of the industry itself.

Have you gotten into any of this debt while in this industry?

Yes.

Okay. Can I just poke a little bit and have some fun?

You can ask me anything you want.

If you're truly scared of volatility, why would you go into debt? Because debt is risk, and it robs your income. If you know this income might not be there, that in your brain, the risk factor was broken.

You just answered my question by saying the thing that would make it easier is that we only had a house payment.

We've been in that position before.

What happened?

We decided to buy the lot that was connected to us, and we built an office here at our house and made some We felt like we wanted to continue to work remote and do what we were doing at the time.

Based on what I've heard, Brandon, you presented to George and I that you're afraid of using the cash you have stocked up to pay off your debt when what you should be afraid of is investing in a loft next to you, investing in other things. Do you see where the fear is misplaced?

Yes.

You're choosing which risk you want to keep. We're telling you if savings is peace, you're right, you are half right. Having the savings there gives you peace. The problem you're forgetting is that debt equals risk. The key to permanent peace is getting rid of the debt. I think you're a little comfortable because you got 3-6 months of expenses saved. Why work that much harder? Why sacrifice that much more? We would be okay if something happened for a little bit. I think getting rid of that savings and putting it on the debt will light a fire under you, and it will expose the reality of situation.

Again, I want to remind you.

I like that.

Brandon, your words. If you emptied out the savings today and paid off all debt and you get laid off, you said that you could weather it based on three other times. You have experience. You were speaking from experience to George and I, correct? Yes. So were you telling us the truth?

Yeah, I'm telling you the truth. I fluctuated in and out of the real estate market in real estate sales as a broker here. The between those times where I've been in oil and gas, and I've had success in that also.

So here's the key factor. You're not scared of hard work. If something were to happen and you didn't have the savings, you would go work your butt off to cover it and then get back on the plan, get back on the horse. Yeah, for sure. So let's get tactical. How much do you have in debt, consumer debt, and how much do you have in savings?

Okay, so total debt's around 200K. That's with the house.

Skip the house. But the The house. We're going to decide. That's a baby step six item.

Yeah. So outside of that, I have 30K on a business equity line of credit that's attached to an investment property we own. Okay. And then I have 20K in a lot loan. So it's a piece of land that's attached to our primary residence.

All right.

And then I have 20K in a home equity line of credit.

All right. So we're looking at 70K out of the 200?

Yeah, and we have about 40K in cash.

Great. Here, tell me, you can knock out the lot loan and the heat lock today. Yes. Do it Double dog dare you. And the other thing is, all of this is tied to your property. So you're putting your house on the block triple right now because all this has collateral, doesn't it? If you don't pay, that's how the heat lock works. Yes. And so for a guy telling me that you're afraid of risk, you've taken a whole lot of risk on. Yeah. So knock both of those out. You got 30K left. Use your future income, which how much are you making as a household? Sounds like you guys make good money from the oil field.

Yes, so I make about 120 when it's going. And my wife, she got laid off last year. She's a medical coder. She got laid off last year to AI, but she's back right now, temporary, and she makes about 40K when she's working full-time.

Great. So for both hustling, we're making 160. We got 30 left to pay down on the line of credit at that point for that business line of credit, which will get knocked out within months, making 160. I'm talking less than six months.

Yeah, and I've got one more question for you guys. I was going to ask, what are your thoughts on as I'm doing what I'm doing right now in oil and gas, on trying to bus back into the real estate market again. So I have something to transition back into when the oil and gas goes down again? What are your thoughts on that?

My quick take is, you really can't win at real estate part-time. And so if you're talking about being a real estate- Right. I know that. So then I don't think that's smart unless that's your goal long term. So if that's what you want to do long term, let's go. But let's do it after we take care of what George... We got the present. We need to win, and let's use what income we have right now to get out of debt, and walk through baby step three, and then be in baby step four, and then let's look at transitioning to whatever.

That's one year from now. Do you see that? You pay off the two debts today. You got 30K left that gets knocked out in six months. Another six months for your fully funded emergency fund to stock back up. Now we've got a real foundation. That's actual financial piece.

I like it.

At that point, you have options, man.

You guys are driving me towards it.

Yeah, I appreciate that. Yeah, absolutely. Listen, you've been afraid of the wrong things.

Okay.

There's no fear walking out the plan George laid out for you. None. No fear. There's some hardship. There's some sacrifice. But on the other side of that is to George At this point, if you want to go into real estate full-time, then after I got this debt done and I got a 3-6 emergency, 3-6 month, and I'd go six months, by the way, and then I'd go all in on real estate because you got to build up a pipeline. But you got some experience, you've dabbled in, it sounds before. But now when I hear real estate- I've been full-time in it before. I'm hearing sales, not you investing. I'm hearing you're a realtor. Is that what I'm hearing?

Yes, I'm a real estate broker. We have a property that we a lot.

Oh, I know. We heard.

I was invested in it. We heard. A commercial piece of property.

Well, real estate people famously have their risk meter broken. And any cash they do have, they want to immediately deploy back into investments because I can make way more money in real estate. But then it leaves us an alert I think Ken is right. You've misplaced the fear. Your fear right now is, what if I have a $30,000 emergency and I don't have the savings? The true fear is you have $70,000 in debt that is tied to your home. That's the thing we should be attacking. You'll get there in no time, man. You work hard, you make great money. We just got to retool some things and clean it up. A year from now, you'll be in a very different place.

Statistics show that half of Americans don't have enough life insurance, or they don't have any at all. I don't understand this, John. Why don't people want to take care of their family? They think they're going to die or something?

Well, I used to be one of those guys. I didn't even think about it. One of my buddies said, Hey, the only reason to not have life insurance is if you hate your wife and kids. I immediately went and got term life insurance.

That's a gut punch.

You're telling me for decades, Dave, I've sat across people who've lost a spouse, they've lost somebody important to them, and they don't know what to do next.

Me too. You're going to have a crisis here. You got two options while you're sitting and talking to a young widow. She's concerned about how she's going to invest all this money properly and not mess this up, or she's concerned how she's going to eat tomorrow. That's exactly right. These are the two options. Take care of your dadgum family, man.

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If you're working the Baby Steps, the best and fastest way to do it is by using Every Dollar. It's more than a budgeting app now. This is the entire plan that we teach, the Baby Steps, all of it right in the middle of this world famous now app. Oh, it's so fun. Track your progress, get personalized recommendations, and coaching, actual coaching for your situation to help you free up more money. It's like having one of the Ramsey hosts with you every day, showing you the next right step. Start it for free. Just kick the tires. Download it now in the App Store or Google Play. Let's go to Carol in Denver now. Carol, how can we help you today?

My question is, what are your thoughts about using AI in tax planning and preparation?

Oh, that's a hard pass for me.

George, what got you here? What made you go, You know what? I'm going to let ChatGPT handle this one.

I was presented with a document from the accounting firm requesting that I authorize AI to be used, and some of it would be overseas, and I'm apprehensive about that.

Oh, so you're going through an actual tax planning firm? Yes. Okay. They're just speeding up the process by using AI We're going to see this everywhere. Almost every organization is going to start using AI to help move things along, reduce the amount of resources they need. That doesn't worry me as much. I thought you were just on your own trying to do tax planning with an AI tool.

No. It's the accounting as well, because the accounting firm does the taxes, and therefore, would they be using an overseas entity to be able to help?

Well, you just need to ask. Here's the thing we preach all the time on any trust, Ramsey trust and service. We want people to understand what the firm or the person is doing for them. They explain it to you to where you go, Oh, okay. If you have questions about that, how is AI being used in the preparation of my taxes? If overseas, what's going on? Just ask those questions. Somebody with great service who really cares about you and values you as a customer certainly has the heart of a teacher is going to have no problem answering those questions. But George is right. I'm not sure you're going to be going anywhere in this country or any other country with professional services that have a decent amount of clerical administrative work where AI is not going to be used.

Okay, thank you.

Yeah, absolutely. Thanks for the call. That's a good question, George.

Yeah, and if you're not comfortable with it, just go, No, thank you, and you can reach out to a tax pro, and you can find one of those at ramsey solutions. Com, and you can ask them, Hey, what role does AI play in the way you do tax planning? If you don't like to answer, you can move along to someone who does it old school.

Yeah. All right, real quick, fun question for our next Paul, are you scared of AI or are you excited for AI?

I'm personally not scared. Okay, good. I'm going to stick to the positives and how helpful it can be versus is it going to take over and destroy everything? Maybe. All right. But until then, I'm going to just live my life.

You're a guy that operates with a decent level of anxiety, so people should take that with a serious shaker of salt.

That is true. But I'm also very pragmatic and I like to be efficient. I think AI can be a great tool to use properly.

Technology does not scare George Campbell. Stephanie is up next in Detroit. Stephanie, how can we help you?

Yeah, about five months ago, my uncle passed away.

I'm so sorry.

He left me in my husband's home. Okay. Yes. Thank you. When he passed away, we wanted to sell the home because it was only a two bedroom home, and it's like 30 minutes away from my kid's school, and on the school district. And since then, we've had issues with property boundary lines, and we've been Working with a realtor, and now since all this, we've started to love the property. I'm wondering what is financially the best decision to do? Either sell the home or do renovation to make it a little bigger?

Okay, let's play this out. You love the home, and so When you started thinking about making improvements. What would be the future of that? In other words, why make those improvements? Why do you love it?

It's on a lake.

Okay. Would this be a secondary home?

We would sell where we're living now and move into the.

That's exactly what I was getting at. Now it comes down to, okay, the boundary issues you brought up. There's been some challenges. Is that something that's easy navigate and you now have some clear direction on it, or is it going to be a headache ongoing?

We're not sure. We're still in the process of it.

Well, I can tell you just- We're not in the state of company now. I wouldn't think about selling my current home and moving into uncle's home, no matter how much I love it and how awesome the lake is. If there were some boundary issues, that scares me to death, George.

I would get clarity on that before deciding anything. Here's the key question to ask, though. Would you buy this house today if it weren't inherited? Probably not. Let's say you had the cash, you knew what it was worth, you could pay cash for it, and you said the same spot.

Would you say probably not?

Yeah, probably not.

Why?

In an area we wouldn't really go to because it's out of our kids' school district.

Then how would you move there today?

Well, the school is on the way to my husband's work.

Okay, but it'd be a pretty big commute for him to get to work, for the kids to go to school. It would be inconvenient for your life as it stands today.

Yeah. Yeah, you just answered the question. Georgia He asked it as plainly as he could. You just said, No, I wouldn't buy it if my uncle didn't give it to us. Based on that and the boundary issues, I would solve the boundary issues so that we could sell it.

The other piece of this, do you have financial goals where if you sold this house, it could really solve some other problems? Do you have any debt? Do you have a mortgage?

We have debt. We actually live in a trailer, and we have about 60,000 in debt.

Is the long term plan to live in a trailer?

No.

Okay, what could this house sell for?

We were told about 150, 200,000.

Okay, so think about it this way.

Is that all cash coming to you? Does he have any debt, in other words, on the house?

Well, we have about 30 grand on the home.

What do you mean on the home?

On the mortgage for the trailer.

No, I'm talking about uncle's house.

It's paid for.

Oh, no, it's paid for.

Okay, great. If you could walk away with 200 grand, pay off your 60K in debt, pay off the 30 on the trailer, you still have 110 left potentially for a down payment on a home? That will go up in value? Unlike the trailer? Correct. Game changer. Yeah, I'm doing that all day long versus taking a vacation home that you may or may not live in. You guys have some priorities right now. So I'm going to take this as this inheritance as a blessing that puts you guys on a very different path than the one you're on right now.

Okay.

Because the current path is not a great one. Can we all say that out loud?

Yeah.

We're $90,000 in debt. The trailer is going down in value, which means you're probably upside down on it, and we need some stability. And what your uncle did is a huge blessing to give you guys a different trajectory for your financial future and for your family tree.

Yes.

And maybe one day, you do buy a house on the lake. But right now, if you guys had no debt, you had plenty in savings and retirement, you were on track to be multimillionaires, I'd say just keep it for fun for now, and maybe in the future, you use it. But you guys aren't in that place. I would sell it, absolutely. Get rid of it as soon as you can and use that money to pay down your debt, get a fully funded emergency fund, and use the rest for a down payment.

Okay.

Yeah, you got a good plan. Do you have a good real estate pro on your team right now helping you solve all those?

Yeah.

Okay. I'm telling you, get that solved. Priority number one is to get whatever boundary issues, get all that clear so that you can list this house and then follow George's plan to it. You guys are going to be living it up. What a great position to be in. So I'm glad that you lost your uncle, but boy, did he bless you. We want to make sure you maximize this blessing, okay? All right. Thank you. All right. Thank you for the call. Good stuff.

I love reverse engineering it like that. If would you do this today on your own volition versus it falling in your lap? If the answer is no, you got to go, All right, this isn't the move. Yeah, I love it. As much as you could justify it.

Do your shark tank.

I love when you do that. Oh, and for those reasons, I'm out.

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Today's question comes from Colin in Georgia. My wife and I recently started the Baby Steps and are quickly paying off debt. We purchased a home two years ago with a 30-year mortgage. Once we pay off our debts, should we refinance ourselves to a 15-year mortgage? The mortgage is currently 25% of our take home. We can put extra money towards the mortgage once we get past Baby Step 3. What would you suggest? This would be a more information-needed situation. I agree. Because It's not that simple. Now, we love for people to get the 15-year mortgage, but if you're already in a 30, it's not a, Yes, go do this today. You got to look at the interest rates and how much the refinance is going to cost you to find out how quickly you would break even. If you would break to be even on this loan in six months, then sure, go for it. But if it's going to take a while to break even because of the current rates and the rate you currently have, it's okay to keep the 30 that you got and just pay extra like it's a 15, or even better, like it's a 5 or 10, and just get out of that thing as soon as you can.

But if you want to crunch the numbers, call up our friends at Churchill Mortgage. They'll be happy to run the numbers for you to tell you, honestly, does this make sense for you right now?

Yeah, love that. Good advice there. Thanks for the question. All right, we're going to go to Jesús in Dallas It looks like our notes tell me that he's got a gigantic car payment, George. It might give you a little indigestion. I've got the fake Tums over here ready to go. Let's see how we can help out there. Hey, Seus, tell us what What question is today?

Hello. Good afternoon, guys. Happy to be speaking to you guys this afternoon. My only question is, I have other questions we have time for, but my main question is, How can I get out of the car loan that I have? It's $34,000 in total. My monthly payment is $830 a month. And I recently got it evaluated for 14,750. And my bank is Navy Federal Credit Union. And I basically asked them if I could get a loan for the remaining the balance so I can sell it. And they denied me. So I was left at a lost. I don't know what to do next.

And they're the ones that are holding the loan?

No. Okay. No. Yeah.

All right. So You said you got it evaluated. What do you mean by that? Who told you the car is worth 14?

Kelly Bluebooks. I haven't taken it to any place where they physically looked at it, but I put all the details.

But you're saying the private party value was 14, 750.

Yeah, if that's a good number to basically trust Kelly for a book.

Yeah, I was just making sure it wasn't the trade-in value, which is always going to be much lower. No. Okay. Yeah. So you are $20,000 underwater. What other debt do you What debt do you have?

I have no other debt. I've been listening to you guys for close to a year now, and I managed to pay off my credit cards. I just have this car loan now.

Good. What do you make?

77,000 a year. I'm a diesel mechanic, so my monthly changes is either under or higher. But that's what my salary is.

Do you have options for not just regular over time with your company, but freelancing, if you will, given your unique skills?

I definitely thought about it, but I have not explored it because I'm so invested in to where I work. I just work so much over here.

How much over here? How much is a lot?

Like 55 to 60 hours. Sixt hours would be like an extreme, but normally 50 hours.

How much were you putting away towards the credit cards while you were paying them off? What was the most amount out of your monthly budget that you were putting on that debt?

On the credit cards? Yeah. I wasn't putting... I was just doing the snowball, and at the end of the So the way I do it, I save to pay off the month first, and then anything extra, I put towards the cards. And I just did that. Anything extra I had, I just throw it at the cards.

So what was the average amount extra that you had to throw at debt per month? A thousand, two thousand? Thirteen?

Thirteen hundred at the end of the month, yeah.

Okay, could you do more today now that those payments are gone?

Yeah, of course. I could not that much more. Maybe like 1,500, 1,600 a month.

Great. So here's your options. Number one, you get a loan for the difference, which you've tried one place, they said no. You can always try a different place. The other option is saving the difference in cash in order to clear the title and sell it. Now, you still need more money to then go buy a different car, right? That's your only vehicle? Yeah.

Well, I bought my fiancee a cash car. We're here recently, like a week ago.

Why'd you buy her a car?

Because I'm the Reserves military, and I do a lot of driving. And when I'm away, she has no way of getting to work or also an important part of information, we're expecting a baby girl.

Oh, wow. Congrats.

Thank you. So for the expected days that I'm supposed to leave, I leave five days at a given time. Okay.

So do you need two cars right now, or could you survive as a one car family?

We can We've been doing a one car since we've known each other. Okay.

So here's your other options and what I'll suggest. You can either save up the 20K real fast, aggressively. Let's say if you can save up 2K a month, we got the 20K in 10 months. To get rid of this. Or you just pay the car off aggressively and keep it. Now, it's a lot of your world, but you've rolled over negative equity. It's not a true picture because generally we say, don't let your total amount of vehicles, things with motors and wheels, add up to more half of your annual income. And with her cash car, you're probably there and we're a little bit over. But that's your other option. If you want to keep it, you pay it off aggressively. That's 34 grand. If you can put, you know, 1,600 bucks a month, it's going to take a while, but you could do it. But because you only need one car, I like the plan of you throwing two or three grand a month of this thing and being done before the end of the year to get rid of it.

Right.

To get out from under this line.

That's a good idea and everything.

But what?

But given that our baby girl is coming here late April, early May, I'm doing the stork mode.

Got it. So you're stacking up cash. Okay. How much do you have saved right now?

I have about three and a half thousand right now, and I expect to have 7,000 by the time she's born.

When are you guys getting married so that we can put those income together?

So Well, we would love to get married immediately, but my mother... It's a situation with an immigration case, and the lawyer basically said it's not a good idea to get married yet. I really didn't challenge it from there. I just said, okay.

Because of your mother?

Because of my mom. In an immigration case with her, I'm trying to get her her residency, I believe, or her citizenship.

But what does that have to do with you two getting married? Why?

I guess I don't know because I never challenged the best date. Now, I didn't ask why can't we.

Okay. Well, I'll give you the math on it. Let's say you save up babies home and healthy. That gives you a pile of cash you can throw at the debt. Within six months after that, you could have the 20 grand saved to cover the difference for the loan and then sell it and clear the title. And then you go down to one car, and then with our future money, now we're saving up to get a second car if you need one, or we're just stacking up the emergency fund if you're out of debt at that point. Okay. There's no shortcuts here. Do not go further into debt. The only reason I tell you to take out a loan from a credit union is if you can go down in debt and then get out of that aggressively.

Yeah, George, I'm wondering why, and I did not hear you recommend this, why not have a third option where he sells the car and gets the max he can get for it because it's going down in value. If they can truly survive off a one car, which is her cash car, why not sell it?

Well, because when you're underwater, you don't have a clean title. Without a clean title, he's not going to be able to hand that the title over to the person buying it. There you go. There's a lien against the vehicle with the lender. To clear that, you got to go to the bank, have the money.

The difference- It's not as clean as it sounds.

To pay off the loan. It's a process, and that's the problem. You can't be underwater on a car you pay cash for. And it's one of the best reasons to never go into debt for a car on top of many others.

Welcome back to The Ramsey Show in the Fairwinds Credit Union Studio. I'm Ken Coleman. George Campbell is alongside. We're here for you, 8888. 825-5225. All right, let's go to Ryan in Salt Lake City. Ryan, how can we help today?

Hey, how's it going today?

Good. How are you?

I'm doing very well. I was just wanting to ask you what I would have to do at 28 years old this February to retire at 40 years old.

Okay. You got George over here who does his magical computations.

Yeah, we can talk about how to do it, and then I want Ken to talk about should you do it.

I like that.

What caused this goal?

I'm trying to go against the green, and I do not want to work until I'm past 60. I believe I have the income in order to do that and break the streak and retire at 40.

Okay. Well, there's a lot of variables we don't know, but let's start with what you make today.

Last year, I made 235,000. And I'm projected this year. That was with some bonuses last year. My pre-tax is supposed to be around 206,000 to 210,000 this year.

Great. So we'll mark it a little over 200.

About 147.

Are you single?

I'm married with two children.

Okay. And that's the household income? Is your spouse at home?

She runs our company that we opened a few years ago. She does consulting for a construction company, but that's her thing. I got out of the company when I went from 1099 to being a W2, hopefully.

Okay. So is that additional income or is that part of the 235?

That's not including my income. She's part-time and doesn't get... She'll maybe get 10 hours a week or so, but I'm not factoring that in.

All right. Do you have a goal in mind of how much you need to have saved in order to accomplish this, to be work optional?

I'd like to have at least $7,000 coming in a month, $7,000 to $9,000 for retirement every single month.

Okay. So you're probably looking at at least one and a half million bucks or something sitting in an account that's invested heavily in equities and stocks. And so do you have anything saved right now or invested?

I have $5,000 in Schwab, and $15,000 $1,000 in savings, and my checking account usually floats around $8,000. I just got myself out of a ton of debt. So right now is my time to start the investment process in order to do the retirement. And I have two loans that I'm still working on.

Okay, so let's walk through the process that I would personally walk through if this was my goal, which would be to pay off all of my debt, and that means liquidating most of the savings to do that, to speed this up, getting a fully funded emergency fund of three to six months, which if you're saying, what's your burn rate every month right now? How much do you need to get by?

Right now, 5,704. 83.

Okay, so let's call it 35 grand as a six not the emergency fund for you guys. So that's your next goal. Okay. Then we need to be investing 15 % for retirement because we want to take advantage of any tax-advantaged accounts we can first. And so if you got a match, let's start there. Roth accounts, that's a great move there for tax-free growth, and then traditional accounts. Then beyond that, beyond the 15 %, if you wanted to put some money away in a brokerage account, that's what you're talking about with the Schwab account?

Yes, and that's WTSX.

Okay. Then if you wanted to put money there for it to grow and you put 50 grand a year, let's say, that would get you about 1. 1 in 12 years. Okay. So you'd be a little off the mark. So then, let's ratchet it up to 70. Well, I could see it at 1. 6. The other factor here is your mortgage. Are you guys, you guys own?

Yes. My total housing is about 28, 28, and that's including the 21, 23 mortgage, WiFi, water, trash, and all that.

Okay. What's left on the mortgage?

We're at 338.

Okay. I personally would attack the mortgage first before I was doing additional into the brokerage account. And you'll have time. What would that be?

What's What would the benefit of attacking the mortgage first be rather than maybe getting rid of a car payment, which is less than the mortgage?

Oh, no, you need to attack the consumer debt first. Hear me say that. So we talked about knocking out the consumer debt, getting an emergency fund, investing 15 %, then anything extra. We're putting some toward college, paying off the mortgage, which means we're probably going to be delaying this plan.

Okay.

Once the house is paid off, now we can invest beyond the 15 %, put money into the brokerage account Because here's the thing, if you got rid of that mortgage payment, it really reduces how much you actually need in that, doesn't it?

I have something to throw at you.

Okay.

So if my housing is 2,828 a month, but my vehicles is 22. 65 a month, I can pretty much free up the same amount if I paid off the vehicles a lot quicker than the house because it's not that big of a number.

Dude, I'm telling you, follow the baby steps. Consumer debt goes first. Did you miss that part? So the cars are going to get paid off ASAP. Then the emergency fund gets stacked up. Then you start investing 15 % into retirement accounts, then some money to college, then we throw the money at the mortgage. I'm not telling you to pay off the mortgage before your cars. Got you. By the way, a guy who wants to retire early should not be carrying $2,200 in car loans. Right. I agree with that. Okay. Just want to make sure because that is flying in the face of your stated of financial freedom. Now, I want Ken to quickly hit on, should you do this? Because I have followed the fire movement and seen what's happening over there, and it frankly worries me.

Yeah. Are you a fan of the financially independent, retire early? That's the fire movement?

I'm not aware of that. Yeah.

Okay. Well, here's what we found, and this is all documented. The guy who started, who's credited, was starting this movement. The idea was work like an absolute maniac, don't live life, don't enjoy anything until you're 40 and you stack, stack, stack, stack, stack. The guy who actually is considered the founder of this actually went back to work two or three years into it for a couple of reasons. Number one, he thought in his mind that he had not actually saved enough, given how the cost of college was going up. That was one of his stated concerns. Also, the guy was bored out of his skull. There's nothing wrong with retiring. I love, by the way, whenever I say this, people always come at me in the comments and come at me because I'm not going to be in there. George will tell me.

I'll fill them in.

I'm not saying that there aren't certain people who can retire at any age and never work at any life and be as happy as a clam, fishing, hunting, whatever Never. But what I am saying is that we know from research that it has negative effects on us because there is this built-in desire in our spirit, in our soul, to make a contribution. I'm not saying you got to work 40 hours a week until the day you fall over. I am saying that it is proven that it is better for us, mentally, emotionally, and physically, to have some type of purpose outside of just play as we age. But I will tell you, I love that you called us and threw it out there. But I got to tell you, after George ran those numbers out, you've got a ways to go.

Based on this, after you follow everything I've told you- You still have to stack a ton of cash. You still to stack 100 grand away in that account for a decade for this to even make sense.

The reason I bring that up is not to discourage you, but to encourage you to have a more realistic goal. And a healthier one. And a healthier one so that we can actually reach it. Because I think you've created a mountain in your mind that's not climbable given your financial realities. But if you do what George said, you're going to be a very happy man and can, in fact, retire much earlier than most.

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All right, folks, if you have kicked your debt to the curve, you deserve to celebrate. Where do they deserve to celebrate, George? Where would somebody... Where would you recommend that somebody who beat all their debt, they got it out of their life, how would you think they might celebrate that?

I think somewhere warm, somewhere tropical, and somewhere with Dave Ramsey and the Ramsey personalities.

How about the Caribbean? I'll go there. With Dave, you, me, and all the other Ramsey personalities.

Take me there. I want to go there.

All right. It's called the Live Like No One Else Cruise. Folks, it's coming back after much popular demand. I'm not reading from any notes here. This is a fact.

Extemporaneous.

Those folks loved it, who went on it before. Car. So mind, mind, mind, this is going to sell out way faster because now everybody knows how great it is. I got to tell you, I'm not a cruise guy, George.

Traditionally.

Well, I don't like being on the boat. I like the clothes that you would wear on a boat. The attire is what you're there for. I like the boat attire, and I like the Caribbean. Well, this cruise was great. And so here we go. We're going to roll it back. I think they say, Run it back, not roll it back. Run it back.

It's your show, Ken.

March 14th through March 14th through '21, 2027. That's next year, if you're looking at your calendars. In the Bahamas. How about Jamaica, George?

Do I want to take you? Was that my cue? It was. Okay.

The Grand Cayman and Cosmo. Cabins are limited. Save up to $300 when you book by February seventh. So, hey, those of you who haven't made any plans, are you kidding me? Next March, you got cash. You want to save 300 bucks? You got to do it before February 7. Click the link in the show notes or go to ramsey solutions. Com/events to book your cabin. I am looking forward to this. I did not think it was going to be as amazing as it was. The ship was great. The people, Our fans are just amazing.

It was electric energy.

The buffets were next level. I will tell you, there was, in fact, a pickleball court on top of the ship. If you're a pickleball enthusiast- And that is where you can find Ken. We had a lot of tournaments going on.

They wore you out, man. You were up there for seven hours. People were like, No, you're not going anywhere, Ken. I want to play you.

There's a shot right there with the headband and the lettuce, as the kids call my hair, flowing on top of the ship. It's on the top deck, George.

That's a bold move to show off your legs, Ken, with those chicken legs you got down there.

Well, there's nothing to be ashamed of. They're just little. That's all it is. We'd love to see you on the cruise. By the way, on stage, did you like my attire? I really went with a cruisehip theme last year.

All of those The white pants you own finally came in handy. I'll say that.

Well, lots of linen. A lot of loafers. Yeah, a lot of loafers. All right. Carol knows what we're talking about somewhere in sunny Florida. Carol, how can we help you today?

Thanks for taking my call.

You bet. What's going on?

My husband and I are both going to be turning 65 this year, and we want to retire at the end of the year. And we're trying to decide if we should pay off our house or not. And if so, where we should pull the money from. We don't have any other debt, and we do have some savings. We have about 1. 1 million in an IRA, 90,000 of that is in a 401(k), and we have about We owe $145,000 in savings. Awesome. We owe 155,000 on the house, and the interest rate is 2. 75 %. The problem is the maturity date on that loan is 2051, so it will be about 90.

Yeah, no, thank you.

But I'm not sure. If I pay it off, I'm not sure exactly where to pull the money from.

So you've got 145K in liquid cash. What is that earmarked for right now?

Initially, to live off of when we retire, we'd like to delay drawing our Social Security, which would be about $4,400 a month. If we draw now, we'd like to wait at least a couple of years and let that grow. Our monthly expenses are about 5,000.

Great. So you almost have the cash to do it, but you're saying you need a big chunk of this to basically live because you want to retire by the end of the year?

Yes. Retirement, for me, is a great goal. It's going to be a really big switch mindset for me because I'm a saver, not a spender. So depleting money out of that savings makes me incredibly uncomfortable That's why I feel like I need a little bit of advice from someone who has a broader outlook.

What's your household income?

Our household income right now is about 160,000.

Awesome. We save about 2,500 a month, and we put about 15% into our investments with employer match added.

Okay.

Outside of 15%, you're saying you have 2,500 extra you can throw at the mortgage?

Yes, I could.

All right. That'll get you far. That's 30 grand right there. And by that point, the mortgage is down to 125 grand. You'll have the money in cash, but you're going to need some of that to float you for a year or two, it sounds like. And do you have any other money outside of the 1. 1 nest egg?

I have about 40, well, let's say, 42,000, no, 52,000 in a Roth. But I didn't start it until 2022, so I don't think I can withdraw from that penalty for five years. Is that correct?

Yes. Do you have a financial advisor you've used to crunch all these numbers?

I have some of my investments in Schwab, and I've talked to them, but The rest of it, I've just done on my own.

Okay. My only fear is that you're riding it pretty tight if you're wanting to spend five grand of net income a year for the rest of your life off of this million-dollar nest egg. That's the part where I can see it working, but A SmartVestor Pro can run the projections out and show you all of the scenarios and what medical costs might be and when Social Security would kick in and when you should take it. All of that will factor into when you should retire.

Okay.

I think you're on the cusp here, and I think you can pull this plan off, but I would double-check it with a SmartVestor Pro to make sure that the numbers make sense. But if I'm in your shoes, I like using cash first. We want to save the retirement. If you have any taxable investment accounts, use that next. Then we move on to traditional accounts. Then if you have any Roth accounts, I would wait as long as I could because those are growing tax-free for you right now. That would be the bucket strategy, and a SmartVestor Pro can walk you through that based on your numbers. It might mean, Hey, we got to work six months into 2027 to make this work, but I want to make sure that you're ironclad.

Love it. Thanks for the call, Carol. Let's go to Michelle right here in our backyard of Nashville, Tennessee. Michelle, how can we help?

Hi. How are you guys doing today? Good.

What's going on?

Good. Well, recently, my husband and I both have had some raises. We're still in the middle of Baby Step 2. I'll be honest, we've been doing this for a couple of years now, and so just trudging along on this Baby Step 2 feels like it's just going on forever. But since we've got these raises, I'm wondering if I can quit my side hustle and just put this extra income towards Baby Step 2.

What was your side hustle paying you?

It's about $20,000 a year.

What's your raise paying you? What's the net on the raise?

About $6,500 a year.

So it's not apples to apples, correct?

Well, it's not, but my husband also got a big increase in pay, and his was about $40,000.

Oh, okay. All right. Yeah, I mean, you certainly can.

What's the timeline differences? Let's say you kept the side hustle and his raise and your raise. How fast would you get out? Hustle down? Versus if you quit the side hustle? Does it delay it by three months or a year?

No, it's not a year. When I put it in the app, every dollar It says it's like three or four months difference. Although, like I said, I'm just tired of working the extra job, but I certainly want to get the debt paid off, too. To be quite honest, I don't like the extra three or four months either.

Well, Well, there's your answer. It's really not our answer. I mean, we can give you our take, but there's no right or wrong answer is really my answer. But I would lean towards, I was going to turn the question on you and you got ahead of me, and you asked your own question and answered it.

You're choosing between two things that suck, continuing the side hustle or continuing to stay in debt even longer and sacrificing in other ways and making the payments and paying the interest. If you can find a second wind here and just power through and go, I hate this side hustle so much. I'm willing to work even harder, I think that will fuel this debt-free journey.

I agree. You hate the side hustle, you hate the debt, but if you work three to four months more, you get rid of both of them at the same time. That's my answer.

Bada bing, bada boom.

I'm sticking to it.

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

All right. It's always fun when we have friends of yours Dave stopped by, and Dave's got lots of friends, George, as you know. And they're interesting people. And this is a special treat for us. We're really excited to be joined in studio by Andy Irwin and Bart Lard. And you're going, I think I may know those names. Well, you do. Andy Irwin, the award-winning filmmaker behind the very first film, I Can Only Imagine. Bart Millard is now producing this as well. I Can Only Imagine 2 is the follow-up to I Can Only Imagine. I got to say to you guys, when I saw that this was coming out, I thought, this is a good sign that the first movie, we know it was a big deal, but there had to be a lot of heat because I'm not a fan of sequels, George. They're hard to pull off. They're hard to pull off.

Unless it's Home Alone, too. You're like, All right, good luck.

That's one that I thought was good but not great. I'm very excited about this sequel. Guys, first of all, welcome to the studio. Welcome to the Ramsey show. I think it begs the question, I'm being serious. I mean, it seems scary to pull off a sequel because it's not done well. You guys were telling us early that things look really good here. Why pull off the sequel? I was terrified. I said no over and over again. Bart and I have been really good friends since the first movie, and they kept bringing up this idea of there might be more story to tell. Cindy Bond, who was the original producer, was like, I think there's more story. I was like, Absolutely not, because I don't want to ruin it. It was just so magic. There's sequels that are made that worship the original, and then they mess it all up. Then there's Top Gun Maverick. The idea of reintroducing you to the world you love and taking it somewhere new. Cindy started talking to Bart and then Brent McCorkel, who did Jesus Revolution with my brother. They started talking about the story of Even If, the song that so many people love every bit as much as I can imagine.

When they started walking through that, they said, You got to hear this. They pulled me into the conversation. They walked me through the story, and it was just the second half of a whole, and it's the perfect end to a father-son story. I was in tears by the end of it. Then Bart was like, I think this is the spiritual sequel to I Can't Only Imagine. I was like, No, this is the literal sequel. I can get that made tomorrow. We pitched to the lion's gate 30 seconds in. They're like, Guys, we're obviously doing this movie. For us to step into it was magic. To finish the movie and test it, we were just nervous. Like, what's the audience going to think? The first I can imagine was our highest testing film we've ever had. It scored a 96 with the audience. This one scored a 97. So it's exciting. That both will. Well, hopefully.

Yeah, and what you guys have done in the world of film and faith, it hasn't always been world-class. You guys have brought just such a level of quality from the stories to the acting, the craftmanship. I can't wait to see this one out in theaters, February 20th, for everyone to see it for themselves, especially for our audience.

Yeah, your audience is in for a treat. Dave and Ramsey is a part of this.

The part of the movie was filmed on the Ramsey campus.

I just found this out moments ago. Tell us what's going on, Bart. How did this happen? Because you and Dave are big buddies. Yeah, he's my stunt double, pretty much. No, man. Yeah, Dave and I have been buddies for a long time. I didn't even realize that he made the movie until I saw the last bit.

Dave Rinds he has a cameo. If you listen closely.

He's got a voice over.

He's one of the- He's listening for a familiar voice. You will recognize it. You're filming on campus here. Then after I learned that, I was also disappointed to find out that George and I did not make the final cut.

You were too expensive. Did they even send you my audition tape? That's the question.

They did, but then they named your price, and it just priced you out. So we're going to have to work up to your level. I'll get there. Got to fill out. But actually, we emailed Dave and said, everybody's like, Dave never says yes to filming stuff like that here. And so I emailed him, and he was on you all's Cruise. And I just said, Hey, Dave, be careful when you're friends with a filmmaker because we ask for stuff. And I was like, How would you feel about us filming the movie at your place? And he was like, Yeah, man, it'll be fine. Talk to the guys, work it out. And I was like...

You picked him on a good day. He was on the cruise. It was a good time.

He was good. He was out in the sun. He had just finished It's a buffet. That's why he was excited. Bart, I want to pick up where Andy left off in describing how this came about. As you were walking through more of the story, as a guy who, of course, you've been nominated, won so many awards as lead singer of Mercy Me, this is such a different space. You used to tell stories of songs. But as you were walking through this in the story that we heard, at what point do you go, I think this is a big screen story.

I don't know if I was ever sure about that until I actually read the script.

I mean, it's been almost 10 years since the last movie.

Exactly. I had an interview yesterday, and they're like, So you're cashing in with a sequel?

I was like, You don't normally cash in 10 years later.

I really was excited that there was a story there.

But man, when Cindy Bond originally wanted to make a movie around Even If, she wanted to just find any story, like fan mail, something.

It was when I met with Brent McCorkel, who co-wrote Imagine, Did Jesus Revolution, and he goes, Where'd the song come from?

As I told him the story, that's when he had tears in his eyes and he was like, This is it.

What if we literally got the band back together and put it in this universe and made it a sequel?

I was a little skeptical because you never think your life's that interesting, and it's not. He made it very interesting. But when I read the script, I was like, Okay, let's do this.

Well, so much of the story is about the true cost of success, the underbelly of you have this thing hit, and there's other piece of your life that you get a flat tire in because you're so focused on your career, and a lot of our fans experience that. Where does this movie pick up? Is it a direct connection?

I think the thing that was beautiful that I was excited about, is that there was a chance to take it farther. I love the stories in the building here, just how Dave has never shied away from that a lot of this was born out of failure and out of learning at the lowest point. With Bart's story, I was really, really just excited that he was willing to look at on the other side of success of what happens if happily ever after breaks, what happens if you get everything you've ever dreamed of. The crowd stops cheering, they go home, and then life goes back to being hard. And where's God and the hardship there? And so this new character, Tim Timmins, gets brought into the mix, played by Mila Ventimilia. Incredible. That people know from This is Us and Gilmore Girls and all that type stuff. Is that based on Tim? Yeah. I said, Tim is. He's the guy. I play pickleball with Tim. Tim Timmins? Small world.

The movie's about Tim Timmins.

They were focused on pickleball.

He's been hurt. He's been playing. He showed up recently, and the weather has been rough. But I got to tell you, I'm a little excited. Keep going. I apologize. So it's Tim. Tim is the catalyst. So Tim is one of Bart's best friends. We co-wrote even if.

And so the story is how we got to write that song.

We got to that point. I love that, dude. I've known him for a long, long time, but didn't know that. You're about to get a lot of him. I I'm going to text him on the way home and be like, Dude, you're holding out on us. I'm going to embarrass him next Wednesday night when we play. I love it. Please do. If you can embarrass Tim Timmins, then you're special because he's hard to embarrass. That's true. But he and Milo just hit it off, and Milo really wanted to make the faith authentic. Tim is this guy that gets thrown into Bart's world and is carrying this secret about his own journey, but has this idea of gratitude, living with gratitude of, God, thank you that you woke me up today in this of tension between grief and gratitude. And he begins to encourage Bart in this journey, and it leads to this amazing song. And ultimately is the healing of this father-son story of Bart as a father towards his son. And we finished it at Red Rocks. We filmed the end of the movie at Red Rocks.

Oh, that's epic.

8,500 people. They showed up, and it's epic. I love it. We're talking about the new movie I can only imagine to in theaters, February 20th. Bart, I want to give you a final word to encourage our audience, because these people, as know well, are walking through some tough stuff. Our baby steps, while simple to explain, are very difficult to do. I've just moved as Andy was talking about the theme of this film. Encourage people who are in those dark days of just scrambling to maybe come up with a thousand bucks, or they're in the middle of baby step two where they're paying off debt and it feels like an insurmountable climb. What would you say to them?

Man, life is messy. Whether you're standing on stage or in the audience, it doesn't matter what's happening in your life. It Life happens, and it's learning to live with grief or stress or worry and gratitude at the same time and realizing that the cliché of God is good all the time, it's that and not God is good if X, Y, and Z happens or comes into place.

God's bigger than that, and he's in all of it. If he's not, then we're hopeless. I love it. Well, folks, if you love the first movie, and millions of you did, I can only imagine, well, I can only imagine, too, coming out in theaters, February 20th. Also a special fan event. A little a sneak peek. Give us real quick 10 seconds on this. February 14th, we got a fan event where they'll have a one-night screening all across the country, February 14th. So you can get some early access stuff. They recorded even if with Abbey Road in London. Where do they get details for that? They get details online. I can onlyimaginemovie. Com. There it is. I can onlyimaginemovie. Com. Did I get that right? I think I got it right. I probably got it wrong. It's your date night. Valentine's Date Night. You can't miss it. Valentine's It's great. Hey, guys, thanks for being with us. I appreciate you guys.

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All right, our scripture of the day comes from Luke 16: 10.

Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much. Our quote today from John Wooden, Do not let what you cannot do interfere with what you can Trent is joining us now in Idaho. Trent, how can I help?

Hey, George A. Ken. I was calling, I had a question. I got a late start on my retirement, and I'm currently in a good position building my retirement up, but I don't really have... I've got a wife and four kids, and we're planning on adding two more kids. But the small town we live in doesn't really offer experience or opportunity for our kids to grow. And I got a potential job opportunity in my company in a larger city where there is more opportunity for my kids, but we would sacrifice our 401(k) growth that we're building right now. Kind of wanted some advice.

What do you mean sacrificing growth there? Because you said it's with your company?

Yes. So currently, right now, my housing, it's not... We pay like 300 bucks a month on rent. And so we have been able to put, for the last two years, we've been putting 40 % of each paycheck into retirement into my 401(k) Roth. And so we've been able to build a lot in the last two years. But in this small town, there's not a lot of opportunity opportunities for our kids to grow and learn things.

So you're saying you'll have less money to put into retirement due to a higher cost of living?

Correct.

What's your pay now and what would it be in the new city?

So it would be... I'm currently getting paid around 74,000 a year, and it was put on the table so I don't have a a set amount that I would be getting paid in a new city. It would be either equal to or maybe a little bit more than what I'm currently making.

It would be a lateral move, but you'd have more opportunities for your family in general? I It's a better quality of life, let's say?

Yes.

I'm taking that over more than the 401k.

I'm just sitting here listening and listening to the line of question, and I'm going, This is a no-brainer to me. What would be the doubt that you have about this?

Because right now I have 165,000 in my Roth 401k, and so we've been able... That's where we're at right now. And we're saving, saving, saving, trying to build it up as fast as we can.

But why? But I understand. Again, what is that the doubt? You're going to be making more money.

Well, it would be... Well, yes, because we wouldn't be putting as much into retirement, but we'd also- Yeah, but you also are going to have some type of a 401k or a Roth program with that company.

Can you still invest 15 % in this new area? Because that's the baby steps. Until you pay off the house, which you guys said you're renting right now.

Well, currently right now we're just in the... Yeah, we rent. We don't have no debt anywhere.

So the goal would be to own a home and then pay that house off one day while investing 15 %. How old are you?

Well, hold on. Let's get to that. But, Trent, I'm not sure that we've landed for yourself why you have doubt about taking this better job with better opportunities for your family.

Because of the opportunity that I'm currently have to build my retirement.

That's That's not the reason. It's not for a 401(k). What makes you so freaked out about this retirement account that you're shoving 40% of your money into it?

I'd like to retire early, but I- Okay, let's stay there.

If you take this new job, will you be making more money, yes or no?

It will be equal to, or maybe a little bit more, but it'll probably be just like an even right across.

Then why are you considering it a better opportunity?

A better opportunity for my kids and my family. In what way? Where I currently am.

Give me specifics.

Specifics? Activities as far as sporting activities, getting them involved in extracurriculars.

Okay, so better quality of life. We can say that, yes? Yes. Okay, let me come back to it. Let's call this company XYZ. I'm not totally cutting you off, George, but I feel like we're stuck here, Trent. Does company XYZ have a retirement program so that the day you come in there, you start contributing through them, just like you are now?

Well, it is through my company. They match up to 3%.

Okay, this is through your current company?

Correct. The company I'd be going to is the same company. It's just a different location.

So he's just saying he's going to have less money because it's a higher cost of living, so he can't put as much into the 401(k). That's the only thing here that you're worried about.

I missed that part because I thought there was an opportunity for you to grow financially in this job.

I would make the case with your employer that, Hey, if I'm going to make this move to a higher cost living area, move my family, I need more compensation for this to then cover the higher expenses. I think that's a fair thing to negotiate.

It's fair, but at the same time, Trent, if this is better quality of life for your family and you're still in good shape, and George, you were going to go to the numbers here to show me- The key is, can you live off of $80,000 in this new city?

Can you cover all of your bills?

Yes, we can. My wife and I are very smart with- Do you have any debt?

No, no debt at all. How much do you have in savings for an emergency fund?

We have 8,000 in our emergency fund, and I have around 42,000 in our savings.

So you have 50,000 in cash, essentially? Yes. Okay, and how old are you?

38.

Okay, you're 38. You wanted to retire early. Can we call that 55? Is that fair?

Yeah.

Okay, if you never get a raise, you invest that thousand bucks a month, that's the money you're putting in, 15 % plus some employer match. You'd have about $1. 5 million at 55. From that one account, that's if you never get a raise from 38 to 55, which we can all agree is a ridiculous proposition. So what's likely to happen is you purchase a home, you pay that home off, you increase your investing, you get raises along the way, and all of a sudden it looks more like $2 million at 55. And that's with you cutting back to 15 %. So the question I would ask is, can I move to this new city while investing 15 % of my income and cover all the bills, cover this new rent, which is going to be higher than $300? And I think you're going to find the answer is yes.

Is the answer yes, Trent?

Yes.

Yeah, we're- He's got a good grasp.

My wife and I are smart.

Yeah, Trent, you're such a detailed guy. You're on top of it. I know you've done all this research. So again, what's the big doubt? Do we still have the doubt? Yes, he's laughing.

There's some doubt. You've got four opposing goals here. I want the kids to have a better life, but I also want to put 40% into my 401(k). And so you've got to just go, what is the best thing for our family right now? I think it's very clear it's moving to this new city. You'll be fine on retirement. I'm really not worried about that. You're in great shape. If you keep staying out of debt, you work your butt off, you're going to keep getting raises. That's right. You're going to get a home. You're going to pay that home off in the next 15 years. Then you have a paid-for home and $2 million in the bank in your '50s.

Where's your wife at this decision?

She is leaning more towards the retirement, putting more into the retirement, which is why I'm hesitant.

Okay, see, this is information that I was trying to dig from you earlier.

I think we need to get to the root of why she's so worried about that, because you guys are on track to become multimillionaires. I think there's an unhealthy fear that is not rooted in reality about this. That's right. You're sacrificing, remember, the quality of life for your children for the foreseeable future by staying where you are. You've got to choose which one is going to lead to a better life.

George, what's your vote? I would vote for quality of life.

I would move yesterday.

I would, too. Quality of life, it's just something you can't measure until it happens. All right, appreciate the call. Hey, everybody, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.