Transcript of You Won’t Win With Money by Accident

Brought to you by the Every Dollar app. Start budgeting for free today. Normal is broke, common sense is weird, so we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studio, this is The Ramsey Show. Jade Walsh, number one best-selling author, Ramsey personality, is my co-host today. The number here If you want to talk, it's 888-825-5225. We're going to talk about you right in front of you. Nancy is with us in Clarksville. Hey, Nancy, how are you?

Good, Dave. Thank you for taking my call. Sure. My question is, I have paid off all my debt in step two, but the problem is I got involved in a lease for an HVAC system. The total cost of the system when paid off at 10 years will be over $62,000 So I'm wondering, do I pay it off using the debt snowball method and just get out of it, meaning I'm responsible for that, or just leave it until I do the house stuff?

Wow. Okay. I didn't know you could do a lease on a heat and air system. That sounds like you got- I went to the attorney general, and I went to a better business bureau, and the attorney general consumer protection department said, It is legal.

It's being done all across the US.

But it's so bad that they… It's horrible. A lease, typically, I have no idea in this case, but typically would have an early buyout provision because leasing is simply financing. Yes, leasing is termination. Okay, what does it cost to terminate it?

The cost of the whole contract.

No.

What you have remaining, yes, yes, sir.

No.

Yes, sir. Right now, my lease buyout would be about $47,000. Oh my gosh.

I've paid $15,000. Now, you're an attorney. Look at that part also, right?

I'm getting there. Right after I did this system, I got diagnosed with cancer. I got sidelined for a few years. Now I'm like, Wait a minute. I don't want to keep doing this. This is fevery. It's theft.

Wow. I know a lot of equipment leasing, certainly car leasing. I've looked at the contracts on all kinds of leasing deals, even employee leasing they have out there now, which is really strange. Every one of those have a buyout provision that is less than the total of payments because you're giving them their capital early. You're giving them their money early, and so they're not collecting interest, so to speak, even though there's not technically an interest rate. Almost every one I've ever seen, but I've never seen a heat and air one, so I don't know. My God, honey. All right, so let's do two things. Number one, I want you to reinvestigate that part of it. Because as suspect as this whole thing is, that part of it is suspect. If the total of your remaining payments is 47, a normal buyout provision would put you somewhere in the 30s. The way you would do that, if that's the case, is instead of paying them in advance, like double payments like you would in a debt snowball, you simply save the money up. You pay yourself into a savings account and then write them one check.

If there is a discount for early payout, and there typically is. If there is not, either way, What is your income?

I just retired from federal service, so my income is roughly 2,400.

Okay, this goes in Baby Step 6 then, because it is the equivalent of a second mortgage It's a lien on your house, because it's a lien on your heating and air system, and you would pay it off in Baby Step 6 when you're paying off the house. Okay. What is your interest rate on your home? 2.

25.

No bueno there. We leave that alone. Because if you had a higher interest rate, I would suggest refinancing and taking them out.

My mortgage balance is 169, 578.

When you get to Baby Step 6, you knock out the lease first, either way, whether you get a discount or not, because it's more than half your annual income. When a home equity loan or a second mortgage of any kind is more than half your annual income, we move it to Baby Step 6. Yeah.

I've never heard of such a thing.

I have now. I'm just shocked. There's a lot of things that I get on this show. This is where I learn about it. Then I have to go look it up later and go, Oh, it is a thing. You know what else? I didn't ask. She said federal employee. Clarksville is a military base.

No, that's right.

So these may be morons that are preying on our military people. Yeah, that's big.

That's a problem.

Which makes us a double negative for this company that does that. If your son is out there, mom, and his new job is selling heat and air leases, tell him, Don't be a crook, and go do something else with his life. Oh, there we go. There you go. I helped with that. Just throw a dart out there into the universe to see if we can hit a balloon. Why not? Yeah. Oh, man. Because I did I have that happen one time. I was ripping on the payday lenders at 800%. Oh, gosh. A lady called and said, Well, my son owns two of those stores. I said, Well, tell him to sell them and quit being scum. He's ripping off poor people. He's oppressing the poor. Read about what happens in the Bible when you do that. It's not good for you. It's not a place you want to be. Messing with widows, orphans, and oppressing the poor. These are not three things you want to do in the Bible. Really, just as a matter of living your life properly. Hello. But yeah, they're scum. They're scum. So, yeah, shouldn't Don't be scummy. Then you're safe on this show.

We'll leave you alone.

We won't talk about you.

We won't talk about your kid. We won't talk about you. We won't do any of that. Interesting to side note, the lease on a car, and I suspect it's true on a heating and air system, is the most expensive way to operate a vehicle. Several publications, including Ramsey Research, have done detailed research on this. When you run the math out, you can take a financial calculator and say, this is what the MSR fee is on the car, which is what it's calculated on. Here's what the buyout is at the end of the lease. A closed-in lease always has a number after three years, four years, seven years, whatever it is. You can buy the car for 12,000, but it was a 64,000 car or whatever it is. You've got those two numbers, and then you have the number that is the monthly payment. When you put those into a financial calculator, you can figure out what the effective cost of capital is. That's a fancy way of saying the interest rate. However, interest rates are not disclosed on leases like they are on car loans. The Federal Trade Commission requires they hand you one piece of paper with your APR on it.

Even if they're screwing you, they have to hand you that piece of paper and you'll look down and you'll see 38% or 28% or 12%. You don't know you got subprime. On a lease, you don't have to do that because lease is not technically borrowing money, but you can run out, but it is borrowing money.

So that cost of capital, there's no cap.

No cap at all and no knowledge of what it is unless you know how to run a financial calculator. I've done it on in probably 40 or 50 leases over the years. Every time I do it, it comes out between 14 and 17%. And so those of you that are, I got my BMW on a lease because my accountant said that was the smartest way to do it, you're an idiot. You got hammered. You're paying 17%. You should fire your accountant and get rid of your beamer. You're getting hammered, but you never did any math. You just thought you were sophisticated. Jeez, no, you wanted a beamer. That's what it was. And there's a way to get a beamer. Very little down, a lot a month, and very little at the end. Yeah, this is the problem. Dave, we got a lot of calls on this show where life happens. One day someone's healthy, they're working, providing for their family, and then a curveball hits. We hear it all the time. A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes. Yeah, and that's why you've always said that having term life insurance from Xander is essential because it protects your family if the worst happens.

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Penelope is in Georgia.

Hi, Penelope. How are you? Hey, I'm good. David, how are you? Better than I deserve. What's up?

Awesome. Hey, I was calling because I wanted an unbiased opinion. I wanted to know, should my husband and I be responsible for my father-in-law's property taxes?

I think you know the answer to that. What do you think?

I think I do, too, but I can't seem to convince my husband that I shouldn't. Why does anyone think you are? I can't seem to convince my husband that we're going to- Why does Anyone think you are responsible for someone else's taxes? My father-in-law doesn't work. I think he has a disability, but I think he can work a little bit to cover his expenses.

How does he eat?

I don't know how he gets all his money. I think he gets some disability. It's not clear to me. I've asked questions.

I don't really get a whole lot of answers. How long has this been going on? How long has your husband insisted on paying these taxes for him?

Backstory. His dad's brother used to pay them, and he died a couple of years ago. After he died, he started asking my husband to do it.

This is only- I'm sorry. They?

They? He's being in pain. I'm sorry. His dad asked my husband to.

Okay, him. He started asking his son to pay his property. He's been doing this three, three years. How old is your father-in-law? He's 60. What's the nature of his disability?

Diabetes and COPD.

Okay. He gets a disability check from who? Do you know?

I don't know. I've asked the questions, but I haven't received any answers.

How long have you been married?

We've been married three years now.

Okay. All right. So this started happening after you got married? Yes. But for some reason, your husband doesn't think it's any of your business. That's weird.

He just doesn't like to have these uncomfortable conversations.

Yeah, he doesn't like to have a conversation that involves him explaining to his wife why he's doing something stupid. Yeah, I have that problem, too. I don't like explaining to Sharon why I'm doing something stupid. It never comes out well.

Right. How How much are the property taxes?

I mean, they're not crazy. They're about 2,100 a year.

And are you guys in debt?

We have a car loan, and I can consider it as daycare because it's just so expensive. So we have daycare expenses.

What's your household income?

It's about 8,900 a month.

And you guys are what? 25 or 26?

No, we're 33 and 35.

Oh, Okay. I missed that one. Okay. Is your husband the sole heir?

No. Okay. The property is in the deceased uncle's name and his dad's name. It's like 50/50. But his dad, yes, he's the only child child of his dad.

Who's the only child of the uncle?

He has a couple of kids.

Okay.

His wife is still alive, his widow.

Oh, okay. All right. At this stage of the game, your best way this turns out is you guys end up owning half of the property.

Right. Okay.

What does your husband do for a living?

He is a field service technician. He just got a different job in coordinating the field service folks. Okay.

All right. I have a 10% problem with him spending $2,100 to pay his dad's property taxes in an undefined situation. I have a 90% problem with how he's treating you. Agree. This is disrespectful to Don't give me the cop out that he's such a wuss. He can't have a difficult conversation with his own wife. Grow a backbone.

Well, yeah, because marriage, there's a lot more difficult conversations than this. So if he can't handle this, then good luck to you.

Yeah.

Well, what I meant was... Well, yes.

No, that's exactly it. That's exactly it. He refuses to talk about it because he knows he's going to lose the argument because he knows he's wrong, and he can't figure out how to weasel his way out of this. And he's more concerned about his daddy's opinion than he is his wife's opinion. This is a bad marriage situation for you. Really, really bad. This makes some really negative comments about the quality of your relationship with your husband and his ability to navigate basic relational bear traps. He doesn't know how to walk around them.

It's either that or you've said your piece, and he wants to do what he he wants to do, and he's going to do it regardless.

Well, that's also a bad idea.

Either way, it's not good. The problem is not the $2,100. With what you guys make sure you have a car loan, you can pay that off. But this is really a very small part of your world on a month-to-month basis. It's truly not the money on this. It's the relationship.

You guys can't sit down and talk about this and make a decision. He doesn't even want to look at himself in the mirror on this because it's a really dumb idea. He's paying 100% of the property taxes to get 50% of the property. Hello? Maybe. If it all goes right and his crazy cousins don't take him to court and try to get the whole thing later, because none of these people did a will either.

I was going to say, sniff that out. I promise you. I was going to say, sniff that out.

Yeah, this is so screwed up. Now, let's say it was all perfect and it was a will and everything else. I'd still tell you to change it. The only way I'm paying property taxes on it is I want it in my name. Go ahead and deed it to me. I pay property taxes on property that I own. That's all. Jade, I'm not paying your property taxes.

I would never ask Dave.

James, I'm definitely not paying your property taxes. Joe, I might think about it. I'm serious. Come on, guys.

Oh my gosh. I know.

It's just cray-cray. Yeah, the big problem, though, in this discussion, Penelope, is the way your husband is treating you and the way you're allowing yourself to be treated. You guys got to get down to the bottom of that.

That's the point, right? He's afraid if he doesn't pay him, nobody's going to pay him, and then they'll lose property. That is the solution.

I bet you this bunch figures it out.

Exactly.

You want me to pay them? Deed the whole thing to me. Otherwise, cousin Eddie, fess up your half. Just roll up here in your RV with your part of the 2100, buddy, because he got two cousins over there that are getting ready to pick it up because the widow aunt is not picking up nothing. She's used to the free ride. Oh, free ride is the family script. Oh, and you never question the family script in a dysfunctional family because that might be saying the Emperor has no clothes. Oh, we're all crazy, and now we have to talk about it. Oh, God. That's what's going on. I know. Once there's a dysfunctional family script in place, no one's allowed to argue with the lines. You just say your lines and you stay in your lane. You play your part, even if your part is screwed up. Then comes along Penelope. Then comes along, worse than that, she called us. There you go. Guys, These types of confrontational, they don't have to be confrontational, these types of conflicts, they have at their core confrontation, discussing uncomfortable subjects Is the ability to do that and still remain likable and still remain loving and still remain kind is the sign of a functional family.

It's also a A signal of whether you're going to end up with wealth or not. That's right. Because if you cannot handle and navigate these kinds of things, you're going to be broke all your life, writing checks for crap that ain't yours. Hello. That's how this works. It works in every family that way. But the families that can figure out a way, and the ones that I've observed that can break the old family script and shift and change, it usually has to do with the faith awakening of a key member of the family. They inject Christ into the discussion and they go, We're going to talk about this out loud. We're not going to duck and cover. We're going to be bold and kind and loving, and we're going to be proper and caring, but we're also not going to be a bunch of enablers and act like we can't talk about it. That one's off limits. Off limits my butt. You're my husband.

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Our Every Dollar team is offering a free live budgeting workshops this month.

In Budget 101, you'll learn how to make a budget with Every Dollar, get tips from our experts, even ask your questions in a live Q&A. Plus, you'll get a step-by-step walkthrough of Every Dollar's features, so you can use the app with confidence. It will guide you through everything in the Ramsey way, by the way. Budgeting 101 gives you the support you need to stick to a budget and walk the Ramsey Way exactly right down the yellow brick road, baby. Sign up for a Budgeting 101 for free at ramseysolutions. Com/workshop. Paige is in Salt Lake City. Hi, Paige. How are you?

Good. Thank Thank you for taking my call. Sure.

What's up?

My question is, my husband and I were looking to buy our first home here early next year or middle next year. Cool. My question is, what are some What are the things that first-time homeowners usually miss, cost-wise? Closing costs or what's your cost, inspections, what are the things that first homeowners overlook in the buying process?

Good for you. That's a really good question.

Okay. The The first way to make sure the question is answered is get a high-quality Ramsey-trusted real estate agent in your corner because they're going to have the heart of a teacher because you're going to forget half of what I tell you in the next few minutes. When you do, then you've got that person that's the heart of a teacher that can walk you right through it. Okay? You ready?

Yes.

Okay. You get them at ramsey solutions. Com/agent, and you get somebody in your area that we trust and has been trained by us, and they will have the heart of a teacher. They will not walk around with their nose in the air acting like you already know everything. They're going to make sure you understand every single detail. Now, yes, you need to get a home inspection. No, you do not need to take it super seriously. If they say the front porch light is blinking on and off, that's not a reason to walk away from the deal. You can fix a front porch light for a couple of hundred bucks. Shut up, okay?

I want to know about water. I'm always looking for water damage.

I want to know about major stuff in a home inspection. Mold, foundations, heating and air systems that are about to go kaput, that stuff. The roof. You always get a home inspection, all right? I'm guessing that you might be getting a mortgage.

Yeah, we're going to do a 20% down payment.

Good for you.

Good.

Now, then all of this stuff has to do with mortgages. Number one, you will have to set up at the closing the escrow account. They will call it prepaid, and they'll typically collect about 3-6 months of the property tax amount and 3-6 month of a homeowners amount. That sets up your escrow account for your insurance and your taxes. Then each time you pay a payment, you add a twelfth of each of those to that escrow account. When the taxes come due, they pay it from the escrow account. But it's a pretty hefty out-of-pocket expense called prepaid to set up the escrow. The second thing is points. If you pay points, you will lower your interest rate. One point equals 1% of the loan amount. It will lower your interest rate about one eighth of a % per point you pay, and it's not worth it. Don't do it. Because in other words, it takes you eight years to recoup your money. So we don't do that one. The other one that's akin to that, the mortgage brokers a lot of times will charge an origination fee, and it typically is one to one and a half points.

What you can ask for from Churchill Mortgage, if you go to them, is what we call a par quote, which is a little higher interest rate because you're not buying it down with the origination fee or the points. But it saves your out-of-pocket considerable because all the origination fee is profit to the mortgage broker, and the mortgage broker also makes a profit when they sell the loan. You can get what's called a par quote. They typically will jack your rate a tiny bit, around an eighth, and a par quote on no points. If you call me up and tell me you paid a point and a half origination in five points, yeah, you've probably lowered your interest rate like one and a half % under market, but you prepaid all the interest in essence. That's what those two things are. We don't recommend doing that. I'm looking for a par quote on my mortgage. Fifteen year fixed. You already know the drill. I can tell, Paige. Okay? Yes. Next thing is they're going to require you to get a survey, even if it's a stupid little subdivision lot where it's very predictable and you're never going to have any trouble with those lines.

And the survey is not worth anything because you're not going to even use it to put up a fence. You got to get a different survey to put up a fence. But this is a loan survey. It's typically maybe 200 bucks in your closing costs. It's one of those mystery closing costs. But the mortgage company simply wants to make sure the house is actually sitting on the lot and not on the neighbor's lot. I have had those things discover where the corner of the freaking house is 5 foot over in the neighbor's lot. We have to do something about that because the mortgage company is not going to loan the money. Oh, and by the way, the buyer is not going to buy the house either if you got a good real estate agent. The next thing is they will require that you buy a mortgage title insurance policy. This is different than the MIP that you're avoiding by putting down 20%. The mortgage title policy is It's title insurance that if the title is bad, this insurance company has to write the mortgage company, not you, a check to cover if the title is bad or pay off the people that come.

For instance, one time I bought a house on an investment deal many, many months ago, and bought it from two sisters who had inherited the land, they apparently forgot that they had a brother. We signed off on everything, and the brother shows up. The title insurance company did not catch that there was a brother in the estate file, the probate file. And so the title insurance company, I had title insurance ensuring that I had good clean title. I did not because I only had two-thirds of it. The brother had the other third. They came in, wrote Bro a check, and Bro went on his way. That's called an owner's title policy. When you buy the title policy for the mortgage, title insurance for the mortgage company, they will allow you for a few dollars, typically 100 bucks, again, something like that, you can ask your title company, for an extra 100 bucks, you can also get a simultaneously issued exact same thing, cost them no more money. That's why they don't charge much for it, to give you the owner's title insurance policy. So that if there's bad title, the mortgage company is covered and you are covered.

I highly recommend both of those. I would never buy a piece of real estate without title insurance, ever, and I don't. Now, who pays for the title insurance can change from area to area. In our area, it's customary for the seller to pay for the title insurance. Then you can buy the simultaneous issue for $100 or whatever. But I don't know who's paying for yours. In your case, you'd have to ask your local real estate agent that can tell you all of that. You'll also have a document prep fee that pays the title company or the attorney that's closing it for prepping it. They also, on top of that, will charge you a closing fee as if they didn't get enough for prepping the docs. They also charge you a closing fee, but they're not huge amounts of money. But you're going to look down through there and you're going to see odds and ends of those. Then lastly, you'll see on the closing statement, a proration of the taxes for the year. If you buy the house on the first of August, you have four months of the taxes, and the seller has eight months of the taxes.

Now, have the taxes been paid for that calendar year yet? If they have, the seller is going to get a credit and you're going to get charged because they've already paid the taxes through the end of the year and you're going to own the house for four months that year. Vice versa, if the taxes are closing in August, but the taxes are due in October, you're going to get a credit for the whole first of the year from the seller for the first eight months, and then you're going to be responsible for the remaining taxes, and they're going to show up in that prepaid escrow account that I told you about. That's a couple of the things you look for. But here's the point of that whole thing. All this stuff is gobbledygoop It's all lumped into what we call closing costs. People go, Oh, my closing costs were so high. It's like it's a vague term. No, you can get in there and dig around and understand what each item is, and you can select to not do some of the items in some cases. That can be part of the But everything I outlined for you is pretty standard, and you're probably going to do it.

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Okay, today's question She comes from Amy in North Carolina. She says, My husband and I have three children, ages 13 to 19. We make around $125,000 a year. Our combined take home pay is $5,100 a month. We have $5,000 in credit card debt, $5,000 in personal loan, and our monthly car payment is $1,275. That's all their car payments combined. We rent a home for $700 a month from our parents. From my parents. Our oldest is at her dream college on scholarship, but we have to pay the tuition balance of $1,000 a month over nine months. We have nothing in savings or retirement. How can we pay off debt when all our expendable income goes toward tuition? Our second daughter graduates next year, and her dream school is also a private university. We want our kids to go to college. We want our kids to go to the college of their choice, but I don't know how we can pay two tuitions when we're struggling to pay one. Can you help me figure out a plan to make this work? Yeah. Oh, man, oh, man. I hate to say this, but I'm also happy to say this because I think it's going to help you.

They can't go to their dream schools. They can't go to these private universities because you can't afford them and neither can they. It's really a simple answer.

My dream car is a Bentley.

I mean, come on. I wish I had a G-Wagon. I don't. That's what it is. You're going to have to draw some boundaries here, and you're going to have to say no, partially because you can't afford it and partially because it's not the right... Who cares if they go to a private school? Who cares if it's their dream school? That's what you've got to do. Yeah, that's going to free up a thousand bucks a month. You've got bigger fish to fry here because you've got a lot of debt. I would say that's the starting point.

I agree with you. I think I would talk to the oldest daughter and say, I have a dream. I have a dream that you got a job and that you paid your $1,000 a month. What a life. What happens when dreams come true? Yes, you're going to get a job, kiddo, if you want to go to that school because I'm cutting you off effective at the end of this school year. This cannot perpetuate. The second thing is, the second one is not going to school there. She can't afford it. She can't afford it. Let me tell you, and it's dumb. I'm going to go $200,000 in debt because I want to go to my dream school. We have interviewed so many college students for the Borrowed Future documentary and asked them why it was their dream school. My friend's sister went there. She said, It's awesome. That's how they define dream school. One said, I want to go to Mississippi and Oxford. Why? It's a really pretty town. You're killing me here. You're killing me. Your lack of decision-making ability is killing me. You're going to go $200,000 in debt so they can go this school because I've always...

Let's just say you dream to go in there because it's a fancy-fancy school. Yeah. Like Vanderbilt. Okay, 70,000 bucks a year, right? Gosh. Okay, let's just pretend. I mean, Vanderbilt is a good school. Yeah, sure. There's nothing wrong with Vanderbilt. It's not horrible. It's got a big name. It's the Ivy League of the South. Generally, until this year, not very good at football, but they got a good football team this year. But 70,000 bucks a year. They got a small undergrad. It's about 3,500. The population of undergrad is about 3,500. University of Tennessee is about 35,000, and it's 11,000 a year. You can mow grass and go there and pay for it.

But here's the thing, though. This is a long line of bad choices. Yes. This is just the most recent one. You If you guys are, I'm guessing in your 40s, maybe getting ready to be 50s, I don't know, but you're still renting. You're still paying 12. 75 a month for cars.

Show cars.

Let's just put that in clarity, Dave. You would rather drive these cars and pay for your kid's tuition because your cars are 12. 75, and the tuition is $1,000. I'm just saying if you were going to trade one for the other, there it is.

I'll just get rid of both of them.

But I'm just saying this is just showing a lack of clarity on decision making. We're still renting. We've got these car notes, and personal loans, credit card debt, you guys have got to change your ways, not just with college, but- You're going to have to disappoint your children so that they don't spend the next decade of their life being disappointed by student loans, getting a degree from a college that's worthless.

Where you go to school does not matter. There is no data, zero pieces of research that say where you went to school caused you to be successful. None. Nada. You went to a good school. Prove it. What did they do? Nothing. Nothing, honey. Just like the cereal. That's exactly what they did. They did nothing because the formula that makes you successful is called stirring up the person in your mirror. They'll go find the knowledge it takes to become successful. There's no correlation. None. 78% of the publicly traded company CEOs went to a state school. Not MIT, not Harvard, not Yale, not Vanderbilt. I went to the University of Tennessee, and people that went to Vanderbilt work for me.

Dave, you don't even know where I went to school.

I don't. Where'd you go to school?

It doesn't matter.

Oh, there's that one. I know that school. It doesn't matter. Where you went to school does not matter, people. So quit overpaying for where you went to school. That's problem number one. Problem number two is help people have a different dream. The dream is to get educated instead of living your dream at 18 years The dream is to put some intellectual power in your tool belt so you can go out there, kill something, and drag it home. That's the idea. It is not... The trees are pretty. You're killing me. They have a great football team. Do you play football? No. What's it matter? None of the people that play football there are going to play football at the next level either. Let's just call good God. The college experience. Yeah, and your $85,000 in debt for your college experience, and you learned how to play beer pong. This is dumb, dumb, dumb, dumb, dumb Working while you're in school matters, getting scholarships matters, and choosing to study something that actually has some use in the marketplace. Getting a degree in left-handed pubertry and then saying you were victimized by the higher education system is bull crap.

You were victimized by your own stupidity because you got a useless freaking degree and you overpaid for it from a useless freaking university. It's just crazy, you guys. I believe in education. All three of my kids got four-year degrees in something they can actually use. And by the way, we paid cash. And by the way, it was the University of Tennessee, Govall State School. If you want to go to Vanderbilt and you've got an extra half million dollars laying around- And go for it. Then dream your little butt over there. But I'm telling you, ours didn't have that choice, and I had the money. I'm just saying, Nope, with a capital N, Nope, not doing this. So that starts and ends the conversation. But you're right. The big deal in this one is it's an extension of a series of bad decisions. We're fighting credit card debt. We haven't prepared these kids to go anywhere, except... Apparently, they've never been told no.

Well, and there's never been a conversation. I think for me, the biggest part when it comes to college, you have to do yourself the service and your kids the service of talking about this early on. Don't save it until junior year or senior year when it's like, Oh, by the way, college, because that's what happened here. You got to tell them ahead of time, Hey, here's the expectation. Here's what your dad and I or your mom and I are going to pay for. Here's what we're not going to pay for. Here's what you're responsible for. Here's the list of places that you can go. Here's the list of places you can't go. We expect you to work. We expect you to have work. Whatever that is, just say it out loud so everybody knows.

When they're 12, so they can start thinking about it. Yeah, man.

I say it all the time.

My parents told me- Here's the purpose of education, to make you more effective in the marketplace.

Right. My parents told me from the very beginning, You better be good at sports or school because you don't have a college fund, so you better figure it out. I knew that it was on me.

Game on. I'll just go ahead and stir up the rest of you. A friend of mine that's got a lot of money, he's taking his kid on a college tour. I'm like, We told our It's Knoxville where the University of Tennessee is. That is the tour. It's over there. Run over and give a look. If you've listened to me for more than five minutes, you know that being normal with your money is not a good thing because normal is broke. And I want you to be weird. That's why I love what we're doing with Fairwinds Credit Union. Our friends at Fairwinds just launched a brand new Ramsey debit card, and it says, Debt is normal. Be weird. Right on the front. I love that because every time you swipe it, you're choosing to live differently with no credit card payments and no debt. You see, Fairwinds has been helping people like you ditch debt, faster, and build wealth for years. They're not trying to shove credit cards or auto loans in your face like the big banks do. And they've worked with us to create the smart bundle for Ramsey fans. It includes a no fee checking account, a high yield savings account to supercharge your emergency fund, and now the Ramsey debit card to help you stay focused on the baby steps.

We're excited for you to try So check them out today at fairwins. Org/ramsey. That's fairwins. Org/ramsey. Insured by the NCUA. Welcome back Welcome to the Ramsey Show in the Fairwinds Credit Union Studio. Jade Walsh, Ramsey, personality number one best-selling author, is my co-host. Sarah is in Virginia Beach. Hi, Sarah. How are you?

Hi, I'm doing well. How are you?

Better than we deserve. What's up?

I guess I have a question about debt and merging everything. I'm a new wed. Me and my husband recently got married in December 12th, 2024. I didn't know that he wasn't as financially responsible as I thought. He has, I guess, been more secretive about his debt. I'm a bit more open about it. He wants to merge accounts, but I'm not comfortable with doing it as a debt because he's been very secretive and has lied to me about certain debt. I'm working on now using your plan to get myself out of debt because I bought a home before we got married back in 2023. I have a car I'm working on paying off, which is supposed to be paid off later, maybe next year, and a couple other few debts. But he has many more that I wasn't aware of and some that I think he's secretive about still. We're going to marriage counseling, but I don't know how to be more comfortable with merging our accounts together and feel like we'll be deeper in debt versus trying to have more assets.

Give me an example. Well, let's clarify, because part of the solution to the problem is you merging accounts, because when you merge them, then you can see everything that's going on. There's transparency there. Give me an example of what that deceit looked Was it… I asked him how much the bill was, and he said it was 300, but really it was 3,000. Tell me an example of what that is.

When he moved into the home out of his rental, it was that he wasn't making enough at the moment because he needed to still finish paying off electricity bills, gas bills, things like that. I told him, Okay, how long did you need to do that? It was about two months. When I was waiting for that time frame, I had got a bill in the mail, and it was from the gas company. When I had asked him if he paid it, he told me yes. But when I ended up calling them, they told me that there was still a balance of $1,200 for a gas bill.

When you asked him about that, what did he say?

He told me that it was paid. I never informed him that I called them until a little later, and he told me that he would end up taking care of It's hard to get it.

When you said, I called them and you lied, you didn't pay it, what did he say?

He just said that I did. He was firm about that he did pay it until I showed him the bill.

Then was he like, Oh, my gosh, I didn't realize There was still an outstanding balance. We're just really trying to get an… Here's what I'm trying to get an understanding of.

Are you dealing with a liar? Or are you dealing with somebody who's disorganized and chaotic?

He has lied about many things.

Not just money.

It just surprised me.

In three months?

Yeah, it's been, I guess, 10 months now. But three months into, yes, the marriage, I found out that he was lying. So Everything before was being deceived in two separate homes while we were courting and things, and then got married, and now everything's in the home, and I'm seeing it more vividly.

Okay. Here's what I'm trying to be clear about, because there is part of this to Dave's point, where some people are just extremely unorganized with their money. As they learn to get more organized, things get better and better. Then there's another part of you guys are married, and I'm wondering what the communication sounds like. Because of the communication is, did you pay the bill? Yeah. You're keeping it to yourself. No, he didn't. It's this much. All of that matters in this situation. Now, what I do think is if he's lying, and they weren't past lies, but there are lies that are continuing on now when you know about them, and if he's lying in other areas, not just money, then you do have a big problem on your hands.

Yeah. You have a big enough problem. You need to be in the marriage counselor's office early and often right now because your communication style isn't good. Because at my house, if I said, Hey, Sharon, did you pay that? She says, Yes. I went, I'm going to check. I call and they go, No, it's not paid. I would go, Hey, I called them. They didn't pay it. I wouldn't wait three days and stew about it. I'd walk in there right then and go, Hey, what's up? You said you paid this.

Right.

Like, right then. She would be going, I thought I did. I screwed up, or I was ashamed, or I was scared, or whatever. But at least we get to the bottom of it right then. We don't carry it around for four weeks and then label her a liar. That's a bad thing to be married to.

What I'm trying to understand from the beginning of your call is you're saying now he wants to combine money, but you're the one who's afraid to. So I'm trying to understand if he's trying to make it right by saying, Okay, let's just put everything together, then I don't have to try to keep something over here while you have it over here. But you're saying, Now I don't feel comfortable doing that.

Too late, you're married.

Right. Are you worrying? What can he do? What do you think he's going to do if you combine finances? Let me ask that question.

I think he's going to spend more because What is the term people use? Like the breadwinner. I make majority of the funds. He helps pay… Since we didn't have a merge account, he would just send me $150.

What does he make?

That's another thing. He's private about that, too. He works for a cable company, and it's supposed to be, quote, unquote, $12 an hour, but they have a point system. So week to week, sometimes he says he makes $500, sometimes it's only So would he be direct deposited into your joint account then?

If you combine finances, is it, Hey, now we direct deposit all of our paychecks into this account, not you get paid and then put money into a merge account. All direct deposits go into the same account. That's how it works. And that's the only way we're doing this, right?

Then we know what he's making.

And what do you make? That's been the discussion. I make 62,000 and some change a year.

How long When did you date before you got married three months ago?

It was about two years.

How many times have you sat with your marriage counselor in the last three months?

We've been going consistently It's once every three weeks, and now he's going one-on-one with the counselor, and I go one-on-one with a woman counselor. Okay.

Well, that's good that you're doing that.

At some point, we have to combine that process, too. Mm-hmm. All right.

Sometimes he's a bit of a spender as well, so it makes me… I guess that's where it gets me a little nervous. Listen, here's the thing.

Now we're merge everything. Here's the thing, okay? If you put all of your money into one account, and you make a list of all the bills that have to be paid on every dollar, and you both agree to them, and we agree where every dollar of our income is going to go this month before the month begins, he has agreed to his spending level, and you have to before it occurs. If he does otherwise, you're dealing with someone who can't keep a contract now with his wife, and then we got a problem there. That's a different problem. But you're not solving a spender by staying separate from them. Combining is the only way to get transparency and accountability on where every dollar is going. You need to talk to your counselor about the language you are using towards your husband. You have contempt all in your language. Exactly. You're rolling your eyes like you're so much better than him on every subject. And that is one of the four horsemen of the Apocalypse, the primary reason people get divorced, when contempt rolls in. So you've got to solve for that, or this marriage isn't going to make it.

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Justin is in Chattanooga. Hi, Justin. How are you?

I'm doing well. Thank you all so much for taking my call.

Sure. What's up? I'm going to throw some numbers at you.

My wife and I currently have total investments of approximately 875,000 in retirement accounts. We owe 390 on a mortgage at 5. 875 Home estimate, conservatively, probably 600,000.

We are inheriting a windfall from an unexpected death in the family.

I'm going to break that down for you because that's where the bulk of my question comes in.

We are getting approximately 700,000 in a traditional IRA, approximately approximately 300,000 in a Roth IRA, approximately 100,000 in a brokerage account, 12,000 in an HSA, and 150,000 that's in an annuity with two payout choices, one either lump sum, which is where I'm leaning towards, versus leave it in the annuity for 10 years, let it grow, and then there's a payout at the end of 10 years. Okay. Who passed away?

I'm sorry. It was an uncle that was very much in excellent health, and it was a very big surprise.

Wow. Yes. I'm sorry to hear that. But we found him. You're the guy that had the rich uncle. Who knew?

I've listened to you for 15 years. I thought I would never be the one.

Yeah, that's crazy. You want me to walk through that? Is that what you want us to do? Yeah.

Well, the two goals are, one is to pay off the mortgage, and then we're also looking at possibly having my wife stay home with our children. Meeting those two goals is where we're heading towards. How do I prioritize these accounts? Yes, sir.

In terms of using them?

Yes, sir.

The annuity lump sum, you can roll that to a traditional IRA and have... Wait a minute. You're the beneficiary on the annuity.

That's correct. Yes, sir.

Okay, that's just clear money then. Okay, we're going to use that and the brokerage towards the house. That gives me 250 of it. Okay. The Roth, you can roll to a Roth and it can grow from the rest of your life tax-free. It's the last thing I'm touching.

Yes, sir.

Okay. 12,000 HSA, I don't remember the rules on that, on an inherited HSA. I suspect it's going to be just like your traditional IRA, which under Biden's new laws, the Secure Act, he called it, inherited traditional IRAs or 401(k)s have to be liquidated over a 10-year period of time because the taxes have not yet been paid on them. When you liquidate them, you're going to pay income tax on that.

Yes, sir.

Okay. That one you've got to take out over 10 years. I would sit down with your smart investor pro and determine how fast I'm going to take that out, but I'm going to take out enough now to get the mortgage paid off. Okay? Probably in the process, if I can't roll that HSA over, it's probably got to be cashed out, too. It's small. I'm just going to go ahead and cash it out. It's for cleanliness. The brokerage, the annuity, and the HSA are gone. The Roth is going to move on. We'll take enough out of the traditional plus taxes to finish off the amount to pay the mortgage. Because I only got 250 in the first two, brokerage and annuity, right? Two. How much was the annuity? Yeah. Yeah. Yeah. Yeah. Yeah.

Yeah. 150.

Yeah, 250 total. Yeah, 250 total, and I need 390. And so you're going to pull some of that 700 out enough to get to there and enough to pay the taxes that it creates. And then I'm going to pull the rest of that out gradually over time to avoid bracket creep on your income tax brackets. So probably about a five-year pull on the balance of that, not a 10-year. And just as you pull it, it's just yours then. You can deal with it. You don't have to roll it. You don't have to do anything. But that Roth is sweet because it can continue in the Roth. As young as you are, that 300 could be millions and millions, just leaving it alone in good growth stock mutual funds. Now, as far as your wife being at home with your house paid off, which is really all that's happening here, the rest of this is not going to create any cash today to amount to anything. Can you all live on your income with your house paid off?

We can live on just my income alone. To maintain the same lifestyle All that we've had, we would need 12 to $1,500 a month, which wouldn't cause a major drawdown on any of this.

I wouldn't assume. Counting the house being paid off? Yes. Okay. All right. You've done a great job of analyzing it. You know exactly where you are. If you're not working on a smart Vista Pro, sit down with one and map through what we talked about, see if they agree with me. Maybe I'm missing something. I don't think I am. But then you could pull that 1,500 off that. What's left of that? 700. What's left of that? 700. Really easy. Okay. It's just taxable. It's just taxable. Yeah, my big concern was not bumping up in tax brackets and paying the government what we could use for other things. Yeah, you're going to pay the government some this year to get enough out to pay the house off. Okay. You might bump your tax bracket this year, but I'm not going to worry about this year. In the coming years, '26 and beyond, I'm going to map out what you're talking about and avoid bracket creep. Sure. If possible. You can do that. It's $15,000 a year, it's 1,200 bucks. You can do that.

That's all we need, really.

That's not going to destroy your life or mess up your bracket creep or any of that stuff. You're aware that the bracket creep is It's a math riddle. It's not like if you move from 36 to 39%, I don't know what your income is, but that does not move 3% on everything. It's 3% on the last dollar.

Yes, sir.

Okay, so the first number of dollars are already going to be what they are. That doesn't change. But it just means I'm going to pay 39% on it instead of 36% on it because I didn't put a doll on it. You want to doll it to where you just get right up to the edge and then don't pay that extra three on that bracket jump. Again, somebody that's doing a little bit of tax work with you can help you do that in your SmartVestor Pro. You can get that doll in. That's very cool.

That's very good.

Wow.

I mean, it sucks that someone had to pass away, but to your point, Somebody had the rich uncle.

Yeah, man. He's already a millionaire, by the way, before we got here.

It just goes to show what you can do to change someone's life when you yourself have your finances in order.

He's now worth $2 million.

Yeah, good for him.

But he did not become a millionaire because of inherited money. No, he was already there. He was already there, barely. Then he just doubled it, where it amounts to. Got about a million Three there, I think, looks like.

This guy's not changing his lifestyle hardly at all. He's going to be the same. You know what I'm saying? His wife will stay home. They'll pay off their house, but he's not going to go out and do something crazy because he's been disciplined his whole life, clearly.

I've always wanted to buy a yacht for $1,000 a month. He didn't call me with that question. This guy's going to be fine. He's got it all dialed in. He knows his numbers, knows exactly where they are. See, that's the thing. Even if you didn't do stuff exactly the way we teach, if we can just get you to Pay attention. That guy's paying attention. He knows exactly where he is. He's already had thoughts about every one of these things, and he's paying attention. You have to be proactive and happen to your money, not have it happen to you. When you're teaching the budgeting classes, that's what you talk about.

That's right. It's about you for the first time looking at everything, and you stair-step on knowledge. That guy said he's been listening on and off for 15 years, and that's the way it goes. The first step is just getting on a budget and starting to pay attention to your month in go, your monthly out-go. That's the first step. Then after a while, that knowledge starts to compound on itself. Before you know it, you're just like the fellow that just called in here. Yeah.

Fully in control. A couple of million, two and a half million in a heartbeat here. Wow. Very cool. By the way, though, some of you out there that are doing all your talking and your theories and everything, Roth IRAs are not subject to the Secure Act when they're inherited. Because they're tax-free. I have moved everything I have. I'm 65 into Roth. My baby Step Seven, I heard you answering a question about that the other day. You were correct. You pay up, pay taxes and convert to Roth, pay taxes and convert with extra money because then it grows not only tax-free for this generation, but also for the next generation, and they're not required to withdraw it. They can just let it grow. Like that 300 Roth he had, he can let that one run. The other one, he's got to cash it out because Biden wants his money. This show is sponsored by Better Health. I have awesome I'm friends.

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If you're out there running around and you're in the Nashville area, stop by and see us at Ramsey Solutions.

We're down by Franklin, Tennessee, just a little bit south of Nashville. We got a big, beautiful campus and a wonderful reception area with a little museum in it and free cookies that are homemade. Yum, yum. Free coffee that's homemade. Yum, yum. Smiling People. There's always 50 to 200 folks sitting out here watching us do the show. We do it on the glass from 1: 00 to 4: 00, central time every Monday through Friday. Among the people sitting in there, or among the area where you sit in to watch the show is the debt-free stage. People come there to do their debt-free screams. It's our favorite thing we get to do around here is to celebrate with people when they have won. The only thing that's more favorite is when it's one of our own from Ramsey Solutions, one of our team members. That's the case now on the debt-free stage. Shana McCully, her husband Chad. Shana has been with us for 17 years in the Finance and Administration Department of Ramsey. For a long time, we've been watching this family Family win, and now they're here to do a debt-free scream. Congratulations, guys. Thank you.

So proud of you. Now, you actually did this in staff meeting the other day when I was leading staff meeting. I got to be there when you did that, and our staff just goes bananas. I mean, 1,100 people screaming when you did your debt-free scream. Plus, she's been here 17 years, so everybody knows Shonda, right? Right. And loves her and so forth. And you, too, Chad. Oh, thanks. All right, so how much debt have you paid off? $336,000. How long did this take? It took us 17 years. And house and everything? House and all. Okay, very cool. But there were a few stops along the way, shall we say. I won't spill the beans. I won't spoil alert. I'll let you all tell the story. Yeah.

Just a few stops along the way, we have a new baby in the beginning of that. We've paid cash for eight cars Hours, two transmissions, over $100,000 in home repairs, and six years of cancer treatment.

For two different people. Yeah. These two. These two right here. How old is Lexie?

Alexa is about to be 20 in December.

Wow.

I remember when Shana walked into the office and tears run down her face and said, My baby's got cancer. I went, Whoa, I can't breathe. She said, Well, try being me. I can't breathe either. I'm I'm like, Well, we got your back. We're going to walk with you. Whatever it takes is whatever you need through this. For a little while, we had a little bald toddler running around here. She was cute. She was a cute little bald cancer survivor. It was very cool. The fact that you were surviving made everybody happy. We weren't worried about your hair, I'll tell you that. Neither was she. Yeah, she wasn't old enough to even care, hardly. Then we get the word that she's beat it, and it comes the other side of it. Then? Then She was three years old. Her treatment went for three years. Then, I think five years later in 2017, I was actually diagnosed with the same cancer that she had been beat. I went through three and a half years' worth of treatment to get through that. I'm now five years out. Yeah, congratulations. We walked with you all through that, too. Absolutely.

Yeah, it was incredible. And watched you change from Deputy Sheriff to Real estate extraordinaire agent. Yeah. There we go. And yeah, the whole thing. So 17 years we've been doing this together. It's been a wild ride. And now the house has paid off. The house has paid off. And so that's why we say 336,000 over 17 years Now, we don't ask what they make because 50 of their teammates are standing around. A little bit unfair to do that. We ask the rest of you what you make, and you have to tell everybody in front of everybody, but we let them off the hook on that. But I mean, needless to say, quite a bit of cancer in that 17 years and quite a bit of the rest of normal life in that 17 years, and you still managed to walk through and get the house paid off. How does that feel? It feels incredible. But I mean, even through cancer treatment and new cars and unexpected home repairs, we never went back into debt.

We always had an emergency fund or just really great people around us that made sure that we never had to want for anything.

Wow.

How do you celebrate what happens next? You've come 17 years to this moment.

Travel. Immediately, we're going to be getting some new cars. We got to update some of the cars that we're driving around, and so we're going to do that. The first thing that we did, or the first budget that we did when we didn't have a mortgage, is we decided that we are going to give a heck of a lot more. We doubled our giving. What we've done in the past, and then went back, put a little bit more into retirement. Then, yeah, now we're out having fun and we're doing it. Cool. Very cool. I'm proud of you all. I think your story is a story of perseverance, sticking with it forever. Forever. Now you get here. What's the secret to sticking with it? Because most people just quit. They just throw up their hands and go, Well, it's too hard. Yeah. For us, we had It was student loans and a mortgage. We never really got those small wins, like the credit cards. We didn't have credit cards, so we didn't get the little small wins along the way. It was two big, huge numbers. The only thing that made us go is the reason why, why we're doing this, what's going to be on the other side of it.

We just had to keep going, just get up every day and go and do it. Having a support system here and having friends and coworkers really understood the why.

It was huge.

Well, they also understood you were fighting a bear with a switch. I mean, it was hard. It was hard. It was a process, man. The team made sure that everything was good all along the way. I watched them take care of you all, and they did a great job.

We have friends in the lobby today. We have one who paid our mortgage for two months.

We have a friend who, when our transmission went out, let me use his car for free for a month.

I mean, we just had people love on us so well.

Yeah. It's the only way you get through it, and that's incredible. Wow. So proud of you all. Proud to call you friends, proud to call your family, glad you're on the team here. Yeah, you definitely need to do some traveling. You've earned it. You paid the price to win. You've lived like no one else, and now you should, by God, live like no one else. Absolutely. I want you to get her a good car, Chad.

We're working on it.

All right, there we go. All right, $6,000 paid off in 17 years, including two different bouts of cancer, several other items that are more normal that went at them, but they stuck with it and pushed their way all the way through. I'm so proud of you guys. Chad and Shana from Nashville, Tennessee. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free. Yeah. Now, all you coworkers that are in here cheering them on, get back to work. Dang, Dave. The whole lobby is full of Ramsey out there. I know, right? Everybody loves Shauna.

Oh, boy, oh, boy.

It's fun, man.

Good for them. So many people would have given up. They didn't.

No, they didn't quit. They didn't quit. They didn't go backwards. No. That was the thing. They never stopped and said, Oh, well, we got to buy a car, and we've got cancer, and the transmission went out. We had to take on a car payment. They didn't say that. They just figured out a way to get it through. Somebody loaned them a car, somebody helped them out. Somebody did that. Sometimes team members, sometimes neighbors, sometimes church members, whatever. Walking through the whole process. Pretty incredible. Very, very well done. They're just neat people. They're just fun to be around. They're excellent. Obviously, her, again, the team just loves her. Everybody's known about her story and their story all the way for years now. Again, been on our team here for 17 years as well, and that's when they started the process. So very cool stuff, man. House and everything is paid off. It took a while. What about you? What are you going to do? Yeah, talking to you. You know who I'm talking to. What are you going to do? You keep being normal. Have you not noticed that normal sucks? Really, you don't want to be normal at anything.

Gross. No, we don't want to be normal. We want to be weird. Like Shauna and Chad, Addison and Alexa.

Top questions people have about online wills. How do I know if I need a trust or if my estate is too complicated for an online will? Well, unless your estate is over a million, I would actually say 5 or 10 million, you probably don't need anything but a will. If you have a special needs child, you might want to put a special needs trust in the will that is formed upon your death. How is that funded with life insurance, typically, until you've built some wealth? What do you need to start your online will? You need to think about things like, who do you want to get your stuff? Who do you want to take care of your kids? Who do you want to make decisions if you're incapacitated, the medical power of attorney and so on? Is an online will legally valid? Absolutely, they are. They're valid with your state. By the way, probate law, the law that dictates whether a will works or not, is state law. It is not federal law. It's different from state to state. What is required for a will to be legal and Valid. If you move states and you're residing in a different state when you die, your will from the other state might not be valid, so you need a new one.

Jump on ramsey solutions. Com/willsquiz. You can find out if an online will is right for you, we can help you with that with the Mama Bear folks. They do a great job, and/or hook you up with an attorney, even, if you've got a super complicated thing. But most of the time, wills are not that complicated. There's just a few items in there that you've got to get right, and that includes the Signature and Notary Pages, which some states have different witnessing requirements and notary requirements. That's the one biggest thing that causes them to become invalid. Just jump in and get that stuff done, folks. Jay's in Phoenix. Hi, Jay. How are you?

Hey, I'm doing great, Dave.

Thanks for taking my call. Sure. What's up?

I'm 27 years old. My fiance is 29, and we are $85,000 in debt. I make $100,000 a year. She stays at home raising our two kids, doing full-time schooling. We are also going to be having twins here in about five months.

Wow.

Yeah, I got a lot going on there. I'm looking to get into homeownership after getting out of debt, of course. Right now, we just rent an apartment. Real estate always appealed to me. I I definitely want to start off with a duplex or a fourplex.

But before that, obviously, I just want to figure out how we should prioritize paying off all this debt that we have. Also, later on, towards my early 30s, I'm looking at switching careers and pursuing a pilot's license, which obviously I have to pay about $100,000 for and definitely don't want to go into debt for that. All right. Any advice?

Yeah, I do have some advice. You got a lot going on. So my first piece of advice is just to focus on one thing at a time, or at least whatever the matters are at hand, because you're talking about a fourplex, talking about flying planes, you've got twins coming in five months. And the first thing I think on the table is the debt to talk about. But The biggest thing is these twins that are on the way, right? Absolutely. Okay. I agree with you. I think the $85,000 in debt needs to be paid off. However, focusing on the matter at hand is these twins. I think the first thing that you're going to need to do is stack up the money as though you were paying off the $85,000. But instead of paying it off, just set it aside because we want to make sure that everything is good with your wife, with the twins, with the hospital bill. Everything like that is square before we take all of our income and start pounding this debt with it. Makes sense?

Yeah. Who's health insurance is covering this?

That's a great question. Unfortunately, I don't really have any health insurance. My fiance doesn't either. She's actually in the process of getting state insurance, which is difficult in Arizona. Worst case scenario, if she's not able to do that, then I will just figure out how to pay for an insurance policy for her.

A little late, she's already got two babies coming. Getting that covered is going to be an interesting process. All right. The first thing I would do is get married this weekend. I am really worried about your fiance. She's getting ready to have four children, no income, and no husband. That ain't cool. You owe her more than that. I get married this weekend. She's so exposed right now, financially and legally and everything else, that it is terrifying to I know you think everything's going to be okay, but the only thing I'm sure of as an old man is that everything is not ever okay. Nothing ever turns out exactly like it's supposed to ever. So you have to put everything in place you can to make sure you play defense as well. I'd get married this weekend, I'd get this insurance thing straightened out, and then I would do what Jade's saying, and that starts stacking cash as high as you can stack it. Because if you're ever going to have a problem with a pregnancy, the probabilities are much higher when you've got multiples.

When were you planning to get married? When was it on the books for?

Yeah, that's a great question. The only reason why we hadn't actually legally got married yet is because her schooling right now, she's not going to get the financial aid or assistance to be able to do that for free if we get married.

I don't want my wife to get off of welfare. I don't want my girlfriend to get off welfare, so I'm not going to marry her. That's what you just said, dude. That's not okay. Her schooling is way not a problem. She's full-time taking care of kids. She didn't need to worry about school right now anyway.

Yeah, you said she was going to be a stay-at-home mom, so that's a moot point.

Yeah. We'll go back to school and we get out of debt and can save up some money. But if the only way you get money is appearing to be poor by shacking up versus being married, that's insincere. Sorry, I'm going to call you on that one. Sorry, not sorry. I'm telling you, man, for her sake, I'm begging her to force you into the preacher's office this weekend. Let's get this solved. Now, then I'm going to pile up cash as high as I can pile it up. Then when babies and mommy come home and we pay whatever medical bills that we don't get covered by this forced place insurance policy, and I don't know what you're going to end up with there. It's going to be expensive. But you've got to cover those bills. Again, twins are more than twice as expensive as singles. There's just stuff that's going on there. We just want to be prepared for all that. Then whatever money is left from that stack, when mama and babies come home healthy and everything's good, we apply to the debt snowball. That's where we list it, Jay, smallest to largest. Pay minimum payments on everything but the little one.

Attack the little one with a vengeance. When it's gone, attack the next one. When it's gone, attack the next one. Every time you pay off one, the payments that you don't have there anymore will help you pay off the next one. The snowball rolls over, picks up more snow. You're making $100,000 a year, if I wrote this down right.

Yeah, that's right. But he needs to be going.

You live in Phoenix, Arizona, and you have now five children.

Yeah. I heard that right. He needs to be going hard in the paint until these twins are born and even after, because this is about to be an expensive life.

Yeah, you're getting ready to have an expensive life after they come, before they come, too, and as they come. We've got to take care of every bit of that. Then when we get out of debt, we'll start worrying about an emergency fund. When we get that done, we'll start talking about a down payment on a house. You're 3-5 years out from homeownership. That's if you work a lot and you get good raises and you're very, very, very careful with your money. That's about where you'll be, somewhere in there. It's doable. It's not impossible, but you're going to have to start making better plans and better decisions you've made to this point to push these things away. If some of that $85,000 is a $55,000 car you drive, sell it, my friend. Sell it and get your life back. It owns you. You don't own it. But if it's just $75,000 in student loans, you can't do that. That's the thing. All right. I have now interviewed, personally, thousands and thousands and thousands of millionaires. Ramsey Research has interviewed over 10,000. I've talked to multiple billionaires that are first-generation rich. The number of them that got there because the government paid for some part of their life is zero.

If your best plan is to figure out the way for the government to pay some part of your life, you are not going to be successful in this life. Reset your thinking. Success does not come from Washington, DC. Santa Claus does not live there. I know him. He lives in the North Paul. Many of you listen to the Ramsey show because you're sick and tired of getting nowhere with your money. You work too hard to live paycheck to paycheck with no money in the bank. But here's the Just listening to the show won't change that. If you want different results, you have to do something different. We've helped millions of people save money, ditch debt, and build wealth, and you can, too. But you got to have a game plan, and that begins with our get started assessment. Go to ramseysolutions. Com ramseysolutions. Com/startnow. Take the free quiz, and get your free step-by-step action plan. If you've had it with money stress and are ready to take control of your money for good, go to ramseysolutions. Com/startnow. Welcome. Welcome back to The Ramsey Show in the Fairwinds Credit Union studios. Jade Walsh, Ramsey personality, number one best-selling author, is my co-host today.

Open phones at 888-825-5225. Lucy Lucy is in North Carolina. Hi, Lucy. How are you?

Hi, Dave. Thank you so much for talking to me. Sure.

What's up?

I wanted to reach out about just a situation that my husband and I are in. I don't really know what to do from here. The back story is in 2020, really at the peak of COVID, we actually moved to the mission field. We were missionaries for two years in the Dominican Republic. And once our two-year contract with the ministry was over, we flew back to North Carolina, and my husband went straight back to work. And I actually got pregnant over there while we were on the mission field. So we came back with another little one, and I actually started working in North Carolina as well. We put him in daycare. We quickly realized that the amount that I was making did not justify me working. So my husband and I agreed that staying home, me staying home with our child was the best option. And things got a lot better for us just in our marriage. But soon we realized that we were running out of anything that we had left. We were missionaries, so we didn't have a lot to begin with. But we really just don't know what to do from here. He's currently getting his license to be an electrician, so he's getting his hours, and then he can take the test to be certified.

I also stay home with our second child. We've had another child since then. And we use our credit card to pay for things like gas to put in our cars and groceries. We ran the numbers about six months to a year ago, and we're in the red. So we don't have anything left over to put into savings or to put anything extra on a bill. We're about $50,000 in debt. So both of our student loans combined. And then his truck payment, which he owes about 7,000 on that. And then we owe about $5,000 on something on... I'm sorry, another 8,000 on our credit card. So that's what that is. But We're renting our little house right now. It's two bed, one bath. It's very small. We don't live beyond our means.

Yes, you did. You just said you did.

What do you mean?

You spend more than you make.

Oh, yes.

That's the definition of living beyond your means.

What exactly do you make? I know you said your husband's studying to be an electrician, but what's he making now?

His gross income is about 70 grand. He works two jobs to help keep me at home. But when I say that we don't live beyond our means, what I meant by that was- You're not living fancy. Right. We're not living fancy.

I didn't think you were doing fancy, but you are spending more than you make. That's not sustainable, mathematically. Correct. That's why you're calling because it's freaking you out, and rightly so.

What job were you doing before you had the two kids to make money?

When we moved back from the Mission field, I got a job at Chick-fil-A, actually, but I was there office manager. I did all of their numbers. I did their credit card. And what did you make? I did all of their bills. What did you make? I did… Let's see. I was making 19 an hour.

Okay. What did you bring home every month?

I don't remember. I work 40 hours a week, so I can do the math really quick.

Well, the reason I was asking is because you guys need money. There's two parts of this equation. When things are tight like this, you can cut everything from the budget, right? But if you're not bringing in enough money, the next part is now we have to work more. You said your husband's working two jobs to bring in the 70K. The first thing that you said earlier was when you had the one who was in daycare, you guys said that you weren't making it enough. I'm like, I have two kids. I know it costs $1,200 for one kid to go to daycare for the month. I'm like, Surely you were making over $1,200 a month. Now, with the second kid, I don't know. How old are they now?

My oldest will be four this month, and then my youngest will be two in January.

Okay, so next- You got a house full.

Yeah, you do. Next year, one of them will be going to daycare or to kindergarten. But my question is, I guess my bigger question is, can you make more than 3,000 bucks a month, which is what daycare costs?

Or can you work from home while the kids nap?

That's another question.

Well, I do sell sourdough on the side. I do bring in… Sometimes it's $100 a week, sometimes it's $20.

You do what? She sells sourdough, which that's great. But I'm talking about solving your big problem. No, I'm talking about money.

Different bread, like real bread. $20 or $100 does not solve this problem. No, I'm talking about you get an extra job that you work from home four hours a day while the kids are napping.

Or a call center thing that you pick up at night when they've gone to bed. Yeah.

And your husband's not doing that much extra. When does he pass his license?

I believe he has about two years left.

Here's the thing. I'm going to level set this Because there's part of this. You called us, there's not going to be a quick fix for this. Everything that we're going to suggest is going to be... It's going to feel very off-putting, and none of it's going to be convenient. That's part of this that you have If you can accept that point and get to acceptance there, then you'll be able to do this. But if you're looking for something that's going to allow you to keep doing what you were doing and not really notice, then we don't have that solution. This is going to hurt because you need the money. You know what I'm saying?

That's the hard part. Yeah, you're in a mess. It's an income versus outgo issue. And your outcome, as you said, is not fancy. You're not buying coach purses and doing all that stuff on the one hand, On the other hand, you got two babies, and only one person in the family is working, and he's not making a ton. He's making good money, but not great money. You didn't call me up with him making 170, making 70, and two years before he gets a bump.

How much is rent?

It's 1,100.

Not bad. What's his extra job? You dropped out. Come back again.

He does trash valet, so he He goes to apartment complexes and he picks up their trash.

Why does he not do electrician as his extra job?

I don't know. I don't know that he's ever really looked into that.

It's a lot more than trash valet. I don't have to look into it to know that.

You'd be All right. He makes 25 for electrician right now, and then he makes 22 for his trash.

Okay. Yeah, but I'm saying I'm going to guess and say if he helped guys wire houses, because I'm thinking he's running the union track, right?

No, sir. He does residential electrician right now. Okay. All right.

Yeah. I'd be shocked if he couldn't get some overtime doing that or work for someone else to do that on the weekends Because he has the knowledge, he just doesn't have the license.

Correct.

Yeah. But I don't care. He's going to have to work until he's just completely exhausted to get these numbers fixed, and you are going to have to pick some income of some kind that's not $20 sourdough bread, that's real money. I need you doing something that's three, four hours a day, and you're making a couple grand a month. You put that in there, this thing starts to turn right side up, and you can begin to pay extra on these things. Make sure you're putting nothing in retirement. Make sure you're not getting a tax refund. If they're taking too much out of his checks and you're getting a tax refund every year, you need to correct those W-2s and bring the right amount home, which is more than you've been bringing home. Don't loan the government money all year and then get it back. That's called a tax refund. Don't do that. And look around and figure out what else we've got that doesn't fit this scenario anymore. I'm with Jade. This is going to hurt. It's going to be harder before it gets easier. Yeah, that's right. Hey, guys. George Campbell here. Do you ever feel like insurance companies only care about your money and not what you actually need?

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And when you're ready to get the coverage you need, you can connect with a Ramsey trusted insurance pro who will only get you what you need at the best price. Go to ramseysolutions. Com/insurance, ramseysolutions. Com/insurance. Experience. Real estate's wild out there. Interest rates are dropping Boys and girls. If you notice, we're down to five and a half on 15 year fixed. Market is picking up. Prices are starting to tick up already. Inventory is ticking up already. It's a crazy time. If you're going to list or sell a house, you need a pro in your corner. High octane, high protein. Not aunt Sally, who got her license three weeks ago. She's going to screw up the deal. I know she's your aunt. I know she's sweet, and you might want some of her sourdough bread, but don't buy real estate from her, okay? That's it. Period. So don't do that. Now go to Ramsey Trusted, and we have vetted these agents or the top agents in the nation. They'll help you get the right house in the right way, the Ramsey way, and you can trust them. We've spent a lot of time coaching them, training them, doing due diligence on them.

They are the top performers in your area. To learn more for free, go to ramsey solutions. Com/market, and we'll help you out with all of that. Lynn is in Philadelphia. Hi, Lynn. How are you?

I'm good. Thank you so much for taking my call.

Sure. What's up?

My husband and I currently live in the Philadelphia area, and we're talking about moving to the Charleston area once the school year is over. Why? The issue is that… Because that's where his parents are and his family, and we've been up here for 20 years. We want to be down there now.

No family ties in Philly.

None at all. My whole family is East in Maryland, and no family ties in this area.

Got it. Is there a job there in Charleston?

For him, he is work from home, so home is where the WiFi It doesn't matter where he is. The issue is my job. My job is specific to my area. I can't do this job in another state, and this job doesn't quite exist in the same capacity in the Charleston area to do this job down there. What is your job? What is your job? I'm a support coordinator. I help individuals with intellectual disabilities get funding to Medicaid and Medicare to pay for staff and supports and living expenses and things like that.

Medicaid and Medicare are federal programs.

Yes, but it's a weird… The state pays a certain amount.

Yes, that's true. Okay. Yes. And South Carolina doesn't have the same program?

It doesn't at all. It doesn't have the same infrastructure. It doesn't have the same kinds of jobs.

It has similar things. What do you make?

It was I make 50K right now.

You can find 50K in Charleston.

Yeah, I was going to say at the lowest, at the most common level, what is the job? Is it management? Is it project management? What is the… Does that make sense? It's What's the task? Social work. Social work. Okay. There's something social work existent in Charleston. It just may not be exactly in the field that you were before, right?

Yeah. I've been looking… I'm already preemptively job hunting and looking. There would be anywhere from a $10,000 to $20,000 pay cut.

You haven't finished your job search yet. I've been to Charleston, South Carolina. It's not 50% of Philadelphia. I'm sorry.

What's your husband make?

Wrong, wrong, wrong. Bad. No.

My husband makes about 120, 125 a year. Okay.

But he makes that wherever he goes, and you're going to sell the house, you own a We own a home there in Philly? We own a home. I'm going to make my discussion. My flow chart is when I get a job, we move. And so I need to get a job now. I don't have to take a pay cut to get a job. I disagree. I want to pay increase. Now, let's reset our mind. I would love a pay increase. Well, let's be realistic. You have a unique set of skills, but the nuanced information that you have is useless there, you told me, and I believe you, in Charleston. But the big picture type of information you have and the ability to manipulate programs and pull them together for other people's benefit is a skill not many people have. Now, I don't know exactly where that applies in Charleston, but I want you to start thinking a little bit broader. I'm going to send you a copy of Ken Coleman's book, Finding the Work You're Wired to Do. I'm also going to send the book Proximity Principle, which might be like our worst scenario, if you don't get the job with the raise, like I'm suggesting, that you get a job close to your old pay with the potential for a raise by getting in the proximity of people doing what it is you want to end up doing.

But once we It's still the idea that you're going to find the exact program, which I'm buying you on that one, I think you're right, because I did leave out the part where Medicaid, Medicare is half of it is state-funded, and some states are more sophisticated in their application of that stuff than others. I'm going with you. South Carolina probably doesn't have that program, but they've got other ones, and they've got stuff that's so to the layman looking in from the outside, that's so similar, but to you, it looks way different. That's the one you need to be doing. I don't know what it is exactly, but you have the unique gifting of working with special needs and working with the government program to pull things together to cause people's lives to be benefited. That's a gift, and not many people can do the things that you do. So I've just got to find a place to apply that that adds enough value that they're paying a measly 50 grand. It's not like you're trying to look for a half million dollar job. It's a 50,000 dollar job. You can make that almost at Target working 40 hours a week.

I mean, it's 20 bucks an hour now at Target. I want you to get in that mindset that this is certainly not a $20,000 I wouldn't accept a $20,000 job. That's a cut by $20,000. No, no, no, no. So hang on. We'll have the Christian pick up and send you all that stuff. I think you're better than you're giving yourself credit for, but you need to pan back and have a broader vision of how your skill sets can apply. When you do that, you're going to land the job, and when you do that, you're going to move. That's how I would do it. Don't set yourself up to, we had to move. You don't have to move. There's no hurry. The only hurry is emotions. You're wanting to move. I don't blame you. Yeah, that's true. Once I get my mind already in Charleston, it's hard to do anything. It's hard to do that. But yeah, think that through that way. Folks, let me tell you something that Ken Coleman and I have talked about for years, and Jade has been in on these discussions. There's something about changing jobs against your will. Oh, You get laid off or your husband moves and gets transferred, so you got to go get a new job, or get fired, or whatever.

It's interesting that the human brain, for some reason, we've noticed this with people, immediately thinks that I have to get paid less, that I lost my job and I couldn't find another job, and so I get paid less. As opposed to you were sitting there In the job, everything's going good, and somebody calls you up and offers you $20,000 more than you used to make.

Why can't it be a glass half full?

You go, Well, of course, I'm going to do that. You leave and you go take the new job with a $20,000, $30,000, $50,000 raise. But that job was there for the person that does the same job you do that got laid off two weeks ago somewhere else. They don't think about the $70,000, in her case, $20,000 raise. They think about the doesn't know them. For some reason, it's something about, Well, I just can't do that, and so I end up with less. That is just a mindset thing. I remember a motivational speaker many, many years ago telling the story. He said, Let's pretend that you went to New York City and you were interviewing for a job, and you really didn't think you were good enough to get the job. Your confidence wasn't strong. The morning you get ready to walk out of the hotel room to do the interview, the phone rings and it's your wife, and she says, We just won the lottery. We got a million dollars. Don't go interview, just come home. You go to your, Well, what have I got to lose? I'll just go down and talk to them anyway.

But now you don't need the job anymore. You walk in and you get the job plus a signing bonus because you didn't need the job. Then you come back to your room and the wife says, Oh, we made a mistake. We didn't get the money. What changed there? Nothing except your mindset. Yeah, that's good. Your mindset changed and how you approach, how you walked to do the job interview, the way you carried yourself, your voice tone, the pace of your voice, the energy level you had, that last little shine on the shoes, whatever it was.

That's good. What's up, guys?

George Campbell here.

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So don't miss out on thousands of dollars of margin. Go start every dollar for free by downloading the app in the App Store or Google Play right now. In the lobby of Ramsey Solutions on the debt-free stage, Jose and Jeanine are with us. Hey, guys, how are you? Good. Good, Dave. How are you? Better than I deserve. Where do you guys live? Live in Rins, New Hampshire, which is about 40 minutes west of Manchester, New Hampshire. Cool. Welcome to Nashville. That's a bit of a haul. Good to have you guys. How much debt have you two paid off? We paid off $283,218. Wow. Good for you. How long did that take?

Took us nine years.

Good for you. And your range of income during that nine years? Our starting income was $112,000. 973. Our ending income was 133, 577. Cool. What do you all do for a living?

Customer service.

And I'm in sales, sell packaging. Very cool. Good for you all. Is the 283 your house? 283 is our house. I'm looking at weird people. Yes, you are. Why you've got the T-shirts on that say it's okay to be weird. I like it. Congratulations, you two. What's this house worth? The house is worth 466,000. I like it. Good for you. How much money is saved in retirement? We've got 587 saved in retirement. We're looking at Baby Steps Millionaires. Way to go, guys. You all are so weird. I'm proud of you. Well done. How many millionaires in your family? Zero. One, you.

Jose, how old are you?

I'm 52.

Wow.

Way to go. Good job, you guys. That is amazing. I'm so proud of you. Thank you. Did you ever think when the two of you pups got married a couple of years back, how long you all been married?

We're celebrating our 20-year anniversary.

Yeah, that's right. 20 years ago, you looked down, did you ever think? Never. No, we He kept saying someday. Yeah, but how? Realized someday wasn't on the calendar.

What sparked it then? What caused you from going from someday to today's the day?

I was lucky enough to have a really good friend, Jason Garner, a mentor of mine who actually shared your podcast with me.

We go to the gym regularly, and he said, Hey, I think you should listen to this guy.

He had me in the car locked for half hour or so. So we'd listen to your show. I made the big mistake. I got on board and came home, and I said, I got this great plan, honey. We're going to sell your car. You were on one of those. You did it. You did it. You did it. I did it. Classic. I stepped in it big. How long did it take to get your foot out of that? Oh, a while, actually. Yeah.

Took a little while. Jeanine, I want to hear that from your side.

He said, I have this plan. I I want to sell your car?

And I went, Oh, no, you're not. You need a new plan.

So how did you get on board then?

What happened? How did you bring that around? How did you straighten that mess up, Jose? Actually listening to someone else's debt-free scream, I remember somebody saying, your why has to be bigger than your but. I just found that comment to be funny, but it stuck with me because we needed to have a strong enough reason for why we were going to do this and why we wanted to get out of debt. Ultimately, that reason was we didn't really know anyone who was debt-free, but we knew that we wanted to do this journey because we didn't want to grow old and still be working beyond our retirement years.

We wanted to be able to enjoy our retirement.

As you say, live and give like never before, so later you can live and give like never before. That was our main goal. Yeah. Way to go, you two. Jeanine, when you all sat down and started talking about the why, that's when we figured out what we got to do, right? Yes.

It took a little while of sitting down and budgeting and letting my guard down.

The wall was there.

Yeah, sure. That's fair. Well, it should be. You have to go, What? You got another scheme? Yeah. Got another scheme? We're going to have a yard sale.

We're We're going to sell your car. We're going to sell everything.

And somehow it was all your stuff. Who knew?

Oh, boy. That is so great. That is great. I'm proud of you guys. Very, very well done. Who was cheering you on while you were doing this? We've got our friend Jason, and there was a couple of other guys that I was able to work with that are also cheering us on, Mike Leone and a a few others up in guard, and they're actually following your plan now because of our story, and it's so exciting. Yeah, it's spreading.

That's great. What are you going to do to celebrate?

We're going to have a really good dinner tonight. All right?

I love it. We are going out to eat.

I like it.

Go for it. Have you booked a restaurant already here in Nashville? No, not yet. Oh, well. Got to get on it. There's some good food in Nashville now. You can go big here now. And guess what? You're millionaires without a house payment. Go big. That's right. Go big. Enjoy that bottle of wine. Yeah. I want you to. That's fabulous. Congratulations, you guys. Thank you. Very cool. What do you all tell people the key to getting out of debt is? Submit to somebody else's plan that is a proven success because it wasn't until I did that that I started seeing my life change. When I came to Christ, I submitted to him. When I came to my finances, I submitted to this plan, and it's been just beautiful. Very cool. What do you tell people, Jeanine? Intentional. You need to be intentional. Those are good words. Intentional and submit. Good words. That is exactly how it works. If you're going to hire a personal trainer and he's got a six-pack and you got a keg, you probably ought to listen. Probably ought to submit. There's something going on there. There's a difference between these two things.

This is a Sesame Street moment. One of these things is not like the other. That's the thing, man. It's true about everything we do. We all have to find something. It is helpful when you have Christ in your life because you've already learned how to submit to a greater power that loves you, that's got a plan, and it's to bring you hope and not I'll bring you harm and so on. Then when you come along to something else, it's a biblical concept like these concepts, and you go, Okay, I'm going to submit to that, and we're going to do that that way. Then you do another one, and then you do another one. It's amazing what happens to your life. That's how people's lives get transformed. So proud of you all. Way to go. Very, very cool. I don't know if I've talked to a millionaire today. That's pretty cool. That is pretty cool. I need to get my daily quota. That's right. All right. Jose and Jeanine, Manchester, New Hampshire, 283 3,000. Paid off house and everything. Baby Steps Millionaires by 52 years old, making 112 to 133. Count it down. Let's hear a debt-free scream.

Three, Two, one. We're dead free. Look at them.

I love it.

So good. I love it. They're 20 years married, came from New Hampshire to do this, dressed the part, had the T-shirts, the matching dress, the whole bit, and got it dialed in, man.

But look, you can see it brought them together. You can see that. It's emotional. Yeah.

Once he got over trying to sell her car. Right. Wow. Very well done. Very well done. That's what it is. I mean, we almost never find a couple, like never, that are at odds with each other, that hate each other, that do this. Of course. We never find people that it's easy. I mean, occasionally, we run into one of those. Something happens, I get some easy money. But most of the time, these debt-free scurries, I mean, this is nine years. In a world where people can't stick with something for nine minutes, and they stuck with it for nine freaking years. Wow. It teaches you. Number The number one character quality of successful people, perseverance. They don't quit. They don't quit. They don't quit. Nine years. That's where all that emotion comes from. Nine years. I know. Yeah, and now they win. I love it. I love it. I love it.

Our scripture of the day, Romans 16: 19, Everyone has heard about your obedience, so I rejoiced because of you. But I want you to be wise about what is good and Innocent about what is evil. Thomas Sowell said, Much of the social history of the Western world over the past three decades has involved replacing what worked with what sounded good. That's interesting. That's just dead on right there. He's a quote machine. Beth is in Texas. Hi, Beth. How are you?

I'm good, Mr. Ramsey and Jay. Thank you so much for taking my call. I'm a longtime fan.

Thank you. How can we help?

I'm hoping to make this question efficient because I feel like a lot can be packed into it. But my husband and I both come from, I would say, extreme wealthy families. We have five children of our own, and our older ones are dating with the purpose of marriage now. Excuse me, how we can navigate potential marriages and prenuptual agreements. I was just wondering how you handled your children getting married?

What a great question. It's just a big deal.

How much you said extreme- There's a lot in that part. It's all in your husband's name now, right?

No. My side and his side, they both have wealth of their own. One side has given all of our children a lot of stock, between 150 and 200,000 in stock. Then when they're 16, they get a vehicle, and then they're possibly going to get a house, and so just things like that. With me staying on top of entitlement, I promise you. I promise you. Really working on that. But letting them enjoy their grandchildren and seeing them getting to enjoy it, but also making sure that they stay servant-minded and not… There's just a lot in there. There's just a lot in there. There is.

There's a weird combination between- It is.

It's hard.

Now that I'm the other side of it, and we're on the grandkids, and the kids have all been married for at least a decade, all Gen 2 Ramsey's been married at least a decade. I'm past it. I looked back and I used to say I hit the son-in-law lottery. Then I went, No, I actually taught my girls how to pick, and they picked good ones because I ran off the losers. The instruction and the lack of entitlement and the spiritual underpinning is more responsible for ours picking well and more responsible then as a result of that for not having the need for a prenup and not having the attitude that it matters.

Right.

So I jump in as devil's advocate a bit. Sometimes we get the call from the actual spouse, the person who's going to marry someone, and they say, Hey, I have a lot of money, and I have a lot of money in my family, and I'm thinking about doing this prenup. We're not necessarily against them when there's a certain number of money involved.

How do you- Mainly if there's a large discrepancy.

Yeah. Where does that line fall?

Beth, you and your husband both had wealth in the background. You're both second-gen wealth, right?

Yes, sir. We found a prenup, and we've been married 21 years this month. Okay. That's okay if you just do that.

If you just do that straight up. If there's a concern, then you just Can we do that straight up? Because you're talking about a million dollars or something. You're not talking about 10 million. You're not talking about 100 million.

No, we're talking... I mean, it's over 50 million each side. I mean- Not yet. No, I'm just saying potential and- Okay, now there's two different subjects.

There's two different subjects. The subject number one is the current asset base of the person getting married.

Yes, sir.

I'm sorry. And that's under a million. It is. 200,000 in stock, maybe a house, right? Yes, sir. And so That's not as big a concern. If they lost all of that in a nasty divorce because there was no prenup, then we would be no big deal because they're getting 50 million. Yes, sir. Okay.

It's the difference between their personal wealth and your family's.

I would spend 90% of my energy on training the child, even as an adult, prior to marriage, that they are not the owner, they're the manager of God's resources. It sounds like you're already doing all of that, okay? Yes, sir. Because you leaned in immediately on no entitlement. You're not raising trust fund babies, damn it. That's what you said, right? I heard you. Yes, sir. I heard you, and I like that, okay? Now, that's all part of it. Now, Then the second part is the generational wealth. I can give you a fix for that. That's no prenups that we did, okay? We did that with the Ramsey Company, Ramsey Solutions Company. It goes to the Ramsey Children's Trust.

Yes, sir.

The stock is owned by the trust. The terms of the trust are you have to be blood relative.

Okay.

Or you can't touch it. Oh, that helps. The outlaws are out, period. And no divorce court judge can interfere with that trust in any state. And so the trust has more power than divorce court judge. So that trust, No. If something happens with one of my kids and they get divorced, their spouse is not going to end up owning part of this because this is in the trust. And so you could take portions of that wealth, whether it's a large piece of property or a series of properties, the ranch, whatever it is, a segment of whatever, and leave it into a children's trust. There's other estate planning benefits to that, too, by the way, that your estate planner can help you with, and you need some estate planning if you're sitting on 50 million because you got a problem, generational. You got a problem, you're going to blow out the exemptions and have a state tax unless that stuff's already in a trust of some kind. You've got some generational skipping trust stuff to learn about and do. But anyway, the way we One of our largest assets is this company. Probably our second largest asset is this campus, and both of them are owned by the Children's Trust.

Some of the other stuff they might get or not get in a divorce because it's not in trust and there's not any prenups. But that's how we did it. We put the big stuff in the trust at death or before death, and the trust has a no one but blood. So grandkids are in. But if you weren't born a Ramsey, you're not in it, no matter what happens.

Yes, I think my husband's side has got quite a bit of that. He's got a trust that has some that stuff in it. And But my side, it's not talked about as much, but we're getting there.

You need to because it's going to cost you $10 million if you don't.

Yes, sir. I know. Believe me.

But anyway, once you get that settled, once it's in your control, your will could state that it's left to a children's trust, whatever it is, and you could have that same provision I've got, and then there's no need for a prenup.

Okay, so Well, I mean, is it okay?

But they still can end up trust fund babies if you don't do the other stuff.

Oh, I'm telling you. We don't need that.

No, they can be. I mean, if you leave them money, they can be idiots, right?

I know.

You got to train them to not- I preach to them, it's not ours.

We are stewards of God.

You'll know that they get that if they feel the weight of the wealth rather than the celebration like they hit the lottery.

Yes, sir, for sure.

Sometimes I see our kids' shoulder shoulders drop like there's a burden of this. There is. It's a burden to it.

It can be.

You have to manage it for Jesus. That's your job.

And to honor my parents for working so hard. To honor, it's It was a big responsibility, but he didn't mess up. God didn't mess up. He knew.

No, it's not a mistake. Not a mistake. Somebody's got to manage it. Might as well not be the other side.

That's right.

Yeah, I mean, this idea. You can manage it for God's glory, and that includes taking care of your family, and that includes some enjoyment of the money, but not exclusive enjoyment of the money. It includes working. Our kids have to work. You're not in the trust if you don't work. If you're on the back of a yacht doing cocaine with your girlfriend while you're married to somebody else, you're not in the trust anymore. You're done. You can lose that, too. We put provisions in there to take care of this stuff because we want it to be a blessing and not a curse. That's the bottom line of what she's asking. It can be done, but most of it is in the training of the next generation. Most of it. That puts us hour of the Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.