What’s My Next Right Step With Money? 02:04:53

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. I'm Dave Ramsey, your host. Thank you for joining us. Dr. John Deloney.

Number one best-selling author and host of the Dr. John Deloney podcast on the Ramsey Networks is my co-host today. We're happy to talk to you about your life, your money, your relationships. We're here to help you do life a little bit better. The phone number is 888-825-5225. Taylor starts this hour in Knoxville. Hi, Taylor. How are you? Hey, Dave. Hey, Dr. John. Thank you so much for taking my call. Sure. What's up?

So I need some help navigating money and family. My question is, is it wrong for my husband and I to lie about our accomplishments and pretend to be broke in order to financially and emotionally protect ourselves? And I'm happy to give a little context with that. It's just cowardly.

yeah yeah yeah yeah i own that yeah yeah how old are you guys how long y'all been married taylor so we've been married a little over a year together for five i am 32 and my husband is 35 so who's the twerp that's going to have a hard time with you succeeding

It's my family, specifically my mom. So my husband and I have paid off over $100,000 in student loans over the last three years. And your mom will feel entitled to some of your money if she hears you're winning?

Correct. Okay. Correct. All right. Almost like I've talked about this before. Okay. Uh-huh. Uh-huh. Okay. She uses money to show love, but more as a means of control. And yeah, anytime one of her kids starts making money, she's got her hand out wanting some. And to clarify, she is financially well off and is not in need of any help.

And she has actually stolen thousands of dollars from me in the past when I had my very first job when I was 16 years old. So we're pretty much saying mom's got issues. Yes. Why do you continue to allow your mom to control you? You're 30. Yeah. I want to honor her as my mom. I don't think that's true.

I don't think that's true. I think that sounds good. It's a good church answer. I think you're still trying to figure out what you did wrong when you were nine that your mom would steal from you. And you still think there's a way, there's a thing you haven't done yet that she'll finally, you'll finally do it. You'll finally give her the amount of money. You'll finally do the thing and she'll go, I'm so proud of you and I love you.

That's what I think you're chasing. And I think you wrap it up in words like honor thy father and mother. Honor thy father and mother does not mean honor their misbehavior. Exactly. Yeah. In all honesty, I would love to just cut her off completely. I don't think I'm ready to do that. I think that's what makes it hard. Here's what you're giving her right now. You've given her money in the past.

You've given her your life in the past. Now you're giving her your integrity. Free rent in your head. Don't give her your integrity anymore. Tell the truth. Yeah. And when she says, well, I want... No. We're on a budget. It's a muscle you're going to have to practice. You're going to have to...

It's like going to the gym. You've just never done squats before. You're going to have to start light, but you're going to have to learn how to do squats. The first time you do it, your heart rate's going to go and your stomach's going to go into your throat. The 80th time you do it, you're just going to be smiling, looking at a poor, pitiful lady who hasn't been able to control her own emotions. Yeah. Because that's actually what she is. She's kind of pitiful. You will never do a thing that makes her finally say, I'm proud of you. Because she doesn't have that tool in her kit. She can't do it. She doesn't know how. No.

So you're dealing with an incomplete person who's got major, major gaps and you cannot have any expectation that she's going to be anything other than that. And you just smile and go, no. I mean, pretend like she had had a stroke.

Okay. And she was in, and she was incapable of, uh, behaving. You would just look at her and smile and go, gosh, that's a horrible malady you've got. But that still doesn't mean you get to come over here and, you know, throw rocks through my window.

yeah and um we you didn't hear any of that you don't want to so bad why you just kept driving why uh can i okay i'm gonna i'm gonna cut to it you're scared you're gonna haunt your marriage yeah and at some point your husband if he hasn't already is gonna ask why her over me why her over our future that we're trying to build together she's taking up a lot of space in your head

So this may be you guys, you may need to sit down and talk to somebody and work this through because this is a mother-daughter dysfunction that's pretty serious. And it's just manifesting itself in the money. But there's a lot of other parts of this. But the truth is you're not going to have peace hiding as a 30-year-old, hiding like you're some kind of misbehaving teenager. You know, I can't tell my mom I got good grades.

You know, I'm like, come on, what? So, because she does not have the capacity. She's a diminished capacity as if she's had a stroke. We'll just call it that, okay? And it affected her ability to be a good mom. And so you just treat her like that and it's kind of sad and it's kind of pitiful. But it doesn't mean I can't tell her the truth. Mom, you know, if it comes up, but you don't need to go in there and go, da-da-da-da-da-da-da-da-da-da, look what we did. Because that's not going to do it either. But you just, if it comes up, you just go, well, you know, hey, yeah, we paid off some money. Right?

But I don't sit down with anybody and go, look at what I did. Yeah, how does that even come up in your house? Yeah, really. Well, whenever me and my husband go, which is less and less frequently now, if I need to go to the restroom or leave the room, they will corner my husband and straight up say, how much money did you make this year? What are you making now? Hold on, but all you say is, I had a good year.

I'm not going to give you those numbers. And you smile real big. Yeah, I'm going to tell you that. It's none of your business. Or when you come out of the bathroom, go, hey, mom, dad, we don't talk about our private financial matters anymore. We don't put those numbers out into the world. Those are private. Those are ours. And if they can't honor that boundary, then they're asking you, we don't want you here.

yeah right that that could be the exit that i'm looking for no it could be but that would be them running you off not you yelling i'm leaving until you learn to behave that's not what we're telling you okay yeah i don't want i don't want i don't want i don't want i don't want to talk about my sex life with you i don't want to talk about my like the dollar amount we made last year i don't want to talk about any number of things that's

That's for us. It's not for you. As I started having grandbabies, I have had way more information from my children about the arrival of children and how they got here than I wanted to know. I'm just telling you. I just assumed we went her direction and just said, you know, y'all just keep that to yourself. I really don't want to know some of this. I just want to see the baby when it comes. Thank you very much. I'm happy. I don't need to know about the practice. Nope. Thank you very much. It's all good. Oh, my gosh.

It's the same stuff. You're exactly right. I'm not going to tell you about that stuff. No. Papa Dave don't want to know. No. Papa Dave don't want to know. I want to meet the baby. Just tell me what the name is and tell me what the sex is when it's appropriate to tell me and then tell me when I can tell people that and then I will. And don't tell me unless you want me to tell somebody unless you tell me not to tell them. I need America to know I had a great joke that I didn't just use. You didn't use it.

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Dr. John Deloney Ramsey, personality is my co-host today. Open phones at 888-825-5225. Today's question of the day is brought to you by Neighborly, your hub for home services. When something in your home breaks, remember the Neighborly done right promise, which is it's not done until it's done right.

Download the Neighborly app today and schedule your appointment, and you know you're going to get great service from a great company. These are good people. From Neighborly's network of local home services. All right, today's question comes from Flustered in Florida. Sounds like a Dear Abby column. What would your name be, Dave? Handsome in Nashville. Devilish Dave. Today's question comes from Flustered in Florida.

My wife and I have been married for nine months, and for the last three months, we've been working the baby steps. We each came into the marriage with debt. Our total combined debt was close to $50,000, but I recently cashed in a whole life policy that was worth $22,000. We've used it to pay off all our credit cards and a small student loan that I had. Had no problem using this money this way, even though most of the credit card debt was hers. The way I feel is we're now one, and so is our debt.

However, she feels very guilty about taking this money and makes her feel indebted to me. I hate to make her feel like she needs to pay me back since I don't feel like this at all. Do you have any advice for this situation? What do you think, man? Well, I mean, yeah, it's a discussion of a view of marriage. You know, you're not in debt to your spouse ever.

You're all into your, you know, for richer, for poorer in sickness and in health. I mean, if you get the flu and she makes you chicken soup, do you have to pay for it in sickness and in health?

If you're laying in the bed sweating through a fever because you got the flu and she's working and she's taking care of you and so forth, do you have to write a check for that? No. We took on each other's burdens where our goal once we walk down that aisle is to serve each other the rest of our lives, to do everything we can to make the other person and life better.

And that includes we took on each other's debt. We took on each other's income. We took on each other's assets and we took on each other's crazy parents. Yeah, I don't think flustered in Florida. I don't think you can make your wife feel anything. I don't think you have that kind of power. Agreed. And my guess is she probably grew up in a home where anytime somebody had to do something for her, whether it's buy her a new pair of shoes or some jeans or get her to school on time.

She was made to feel like she was a burden to them. And so now she's married somebody who loves her and is all in. And she doesn't have the, for lack of better terms, she doesn't have the script for that. She doesn't have the wiring for that. And so she's going to have to choose on her own to feel that discomfort and realize you're not holding this over her head. This isn't an ROI. In fact, Dave, I talked to somebody recently who's had a relationship struggle. And he said the person that he was with

was listing off all these things that they do versus and i said once you get into list once you get into roi comparison your your relationship's in trouble um sometimes that's an important conversation to have because it's way out of whack but man once you start keeping tabs um that can be the death of a relationship and she married someone that doesn't do that and so she's gonna have to learn how to not feel guilty every time she needs some some support some love and some care well this is just a

It's a philosophical view of a proper marriage relationship. And the philosophical theological view is that

I no longer own anything. We... We do. ...own everything. And that's training that you can decide to do that. I tell couples all the time, when you get married, your pronouns change. It's not mine and yours. It's ours. It's ours. It's we. We're French. We, we. And so everything's a we. It's a pronoun. It's a plural now. And I'm not talking about pronouns out in the crazy world. That's not what I'm talking about. I'm talking about...

out of the abundance of your heart, the mouth speaks and go, we had some debt. We paid off the debt, which is how flustered feels, but his wife didn't feel that way. Right. And so, uh, I think we just talk about it out loud and go, look, the right way for us to view this, both of us is that everything that's mine is yours and everything that's yours is mine. There's not any years in mind. It's ours. And, uh, if we can get there and start using our intellect as an act of our will to practice that and practice thinking about it that way, uh,

then, you know, it changes everything. I'll give you an extreme example out there for those of you listening. I mean, Sharon, my wife, has not earned $1 of income other than consignment sale clothing since Denise was born, and Denise is 38. Mm-hmm.

But we have had a really good income during those 38 years, you know, or 36 or whatever she is. But we have an income. The Ramseys have an income. I technically earned all of it.

technically, except for the part where I get to go to work all the time because she's doing all this other work. That's right. But, you know, so you can't really bifurcate all that and it work out any other way. So we have an income and, you know, and Sharon will use that

It took a while, but, you know, she was like, hey, you know, you're making pretty good money. No, we are making pretty good money. We are. We make enough for us to buy that car that you're going to drive. Right. You know, and you really got to kind of practice it. Yeah. Especially when there's a single income family or when one of you brought more.

assets to the table. In his case, I used his whole life policy to pay off her credit cards. But it's not his and her anymore. Once you get married, it's ours. Here's another side. I made this mistake. I bought a car with cash, I don't know, five years ago. And we didn't take a note out on it. I just bought the car and went down to the courthouse. But I put it in just my name. And it never occurred to me. And my wife said,

that makes me feel like you went and did a thing on your own. It never even, it never even, no, no, no, this is ours. All this is ours. Right. And so even, even the going back to the courthouse and changing the name, this is John, both of our names are on the title.

Which costs a little money. Yeah, but it's an important thing. Very important. Very important. Well done. So it's something flustered. You've been married a whole nine months. And so it's a muscle you guys can grow into and learn. It's very possible. You're going to be just fine, but it gives us a chance to get up on a soapbox and tell everybody how to do it. Corey's in Norfolk, Virginia. Hi, Corey. How are you? Hey, I'm doing good. How are you guys? Better than we deserve. What's up?

Good. Well, me and my wife, we're looking to move from Virginia to North Carolina. We have a toddler that is three years old, so we're looking to get to a lower crime city and somewhere with better schools. So we currently don't have any debt other than our mortgage. We owe about $240,000 on that. We can sell our home for around $450,000 here. We would be looking to purchase there for $500,000 to $600,000. We'd be looking to roll probably $175,000 on

From our current home in, we also have $125,000 total in savings. So just trying to get an idea of is this a smart move for us to go ahead and make, you

taking our emotions out of the situation, and how much would you put down if it is a good situation? I put down everything I had except for three to six months of expenses, and I would put the mortgage that you take out on a 15-year. As long as the payment's no more than a fourth of your take-home pay, then you can afford this.

Okay. And I think you can. All right. I think it fits in your numbers. I think you're just fine. You are moving to a less expensive real estate market and still moving up in-house, by the way, and blaming a little baby. Yeah. I would much rather. Dave's on to something really important. I think for the sake of your relationship with your kid.

I think it's important for you and your wife to say, hey, we want to move for a better, because we have some goals for our life. But during that stress of moving, that stress of getting a driver's license, it can be real easy to look at that kid and slowly start to resent that kid. We're doing this for you. No, you're not. You're doing it for y'all. And the kid, yeah, went to new schools too, of course, but also it's for y'all. Yep, yep, yep, yep, yep, yep, yep. That's how that works. Yeah, just, I mean, it's, all of it's fine.

But you did move up in-house in a cheaper real estate market. Point being, you didn't have to, to accomplish the school goal only. But that's okay. You can afford it, I think, Corey. So I'd probably go right ahead. I just watch my... I always try to think about how I... What I use to reason my way through that and was that reason process factual? And that's why I'm challenging you just to help you with that in the future. This is The Ramsey Show.

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Dr. John Deloney, Ramsey Personality, is my co-host today. Lee and Nicole are on the debt-free stage in the lobby of Ramsey Solutions. Hey, guys, how are you? Hey, great. How are you? Good. Better than we deserve. Where do y'all live? We live in Greenville, South Carolina. Oh, I love it. What a great town. Beautiful. Welcome to Nashville. Thank you. How much debt have you paid?

We paid off $462,000. Whoa! Yeah. How long did this take? Forever. 53 months. 53 months. And your range of income during that time? We started out at about $180,000 and then up to $305,000. Wow.

Wow. What do y'all do for a living? We're veterinarians. Oh, very good. Both of you. You on the practice? No. But both of you are making $100,500. Yeah. Or thereabouts. Good for y'all. Student loans? It was. Yeah, those vet loans will get you, man. Big old student loans. So bad. So bad.

I took a call last week from a guy whose wife was wanting to go be a veterinarian. He was an accountant. He was trying to figure out if it was worth it. I was with you, yeah. Yeah, I said, it was worth it. It's worth it, but you've got to really think it through. So you've been out of school five years, I'm guessing. Four years. Almost nine. Oh, okay. So what happened after, you know, it looks like about five years ago, this thing blew up. What's the story?

So it started in 2015. That's when we graduated vet school. And each of us owed probably $170,000 or so. We were put on an income-based repayment plan. As you do. And, you know,

At 6.5% interest, $170,000. We weren't even covering the interest. Not even close. And so between 2015 and 2019, our loans went from $170,000 to well over $200,000. Each. Each. Double. And so it was early 2019. They didn't do a lot of math in vet school, but even you knew that was backward, right? Yeah. We had no plan to try to tackle this. We had absolutely no idea what to do. It was so stressful, for sure.

And Thomas Greiner, he's a vet. He was our classmate. He and I were working together. And early 2019, he invited us to his church to attend FPU. Oh, wow. And Nicole, she was really excited about it. I was very hesitant. I was like, you know, we make what we make. What's this Dave guy going to tell us that we don't already know about money? Boy, was I wrong. Yeah.

So early 2019, we went through FPU. We actually missed week nine, the last one, because our son was born. Oh, wow. And him coming into the world, it just kind of changed everything. Changes, you know. That was the icing on the cake. Oh, yeah. We got to get rid of this debt. Yeah. And we don't want him to have to go through what we did. Go through what we did. We want to be able to pay for his college one day. Mm-hmm.

So he was born in early 2019. We had like $1,000 worth of cell phone debt, $29,000 between two vehicles. Two cars, yeah. And the remaining $432,000 was our student loans. And so it was like late 2019. Yeah. We started in on my half of the student loans. And we still...

We still didn't even really know if we could do it. It seemed like such a huge mountain. Yeah. And then... Such a timeline. Early 2020, COVID. Thanks, COVID. It helped us so much. So, you know, we got the pause on the interest, and that's when we just really... We were able to... Through everything we could. Go through everything. And y'all were essential, so you kept working like crazy people. Worked more than... Yeah. Yeah. And you weren't part of...

The 99.9% of Americans who just sat. Exactly. Y'all looked at this as an opportunity. It saved us probably $80,000, $90,000 of interest. You know what? I bet it did. Yeah. Yeah. Over five. That's pretty tough. That's right. Because you hit it exactly right. That's amazing. We started the loans just before COVID hit. Just before COVID. Wow. Wow.

And then early this summer, we actually decided to move to Greenville. We had been living in Georgia the entire time. So we sold our house, took some of the equity from it, and paid off the rest of her loans right before the payment started back. Oh, perfect.

So perfect timing. Yeah. And then took new vet jobs there. Yep. Exactly. Are y'all working the same practice? We actually are. Yeah. Okay. Yeah. Large animals, small animals? Small. Small. Small animals. And now y'all are 300 plus with no debt. That's right. We got to get a house again. So that's where we're headed next. We're in 3B now. Yeah. But yeah. Yeah.

Way to go, you guys. That's a different house when you don't owe $400,000. That's right. It is. It's going to be better. Well, you don't need a bedroom for Sally Mae. No. That's pretty cool. Way to go, y'all. Thank you. You got to feel like I can do anything. Like you got a superpower. It's a weight. Weight lifted off. Weight gone for sure. Wow.

All right. Hey, can I ask you a hard question? Sure. I want you to speak on behalf of everybody in this industry. Okay. And I say this industry, that's not true. With this mindset, millions of people go through FPU and they know, I don't know what I'm doing. Yeah. There's a whole bunch of people that make a lot of money that think,

Ain't nobody gonna tell me. And they're real smart and they got a lot of fancy letters after their name and some huge framed diplomas on their walls. And a huge student loan debt to go with it. And a huge student loan debt and they can't breathe and they're arrogant at the same time. What finally got through to you?

Because what you said, I hear that all the time from my medical doctor buddies, my nurse practitioner buddies. What's this Ramsey guy? Like, what's that? Oh, okay, just live on less than you. Okay, man. Like, that's a hard thing to get through that ego. Yeah, yeah. No, it was, you know, just going through the class, it all made sense. And when I actually sat down and figured up the numbers and did the calculations, it's like,

yeah, this would work. Like all we've got to do is do it. We have to set our mind to it and just do it. Just plow through and go. So once I actually ran the numbers, that's what flipped the mindset for me. It's so daunting looking at the big picture like that. And then if you kind of scale it back and do one step at a time, like the Baby Steps show, it's...

much more manageable. How do you eat an elephant a bite at a time? Way to go, y'all. Thank you. So proud of you. Who was cheering you on, telling you you could do it? Thomas, of course. Thomas Griner. That got us started. And then our good friends Marcy and Eric. They're watching, hey. And then my parents as well. All right. Very good. Anybody roll their eyes and say you're crazy?

A lot of it, yeah. It came up quite a bit at work, and we just mentioned what we were doing, and some people were like, yeah, that's cool. Some people looked at us like we had six heads. It was like, you're throwing $10,000 a month out the window when you could be buying a bass boat? And forgoing that many years of...

savings. It's just, yeah. Yeah. Yeah. 53 months. I mean, you've been scratching for a while. This is real. And do you have the junkiest car pulling into the, to the parking lot? Not really. Cause I was part of our debt, right?

Oh, there you go. Yeah, so a stupid move is like six months before I graduated vet school, I went and bought a brand new F-150. Of course. There you go. Well, that's required. I had to have it. It's required. I've still got that truck. It's 10 years old now, but it's paid for. Well, treat it right and you can give it to your child when they turn 16. That's right. That's right.

Great job, Lee and Nicole. Way to go, y'all. We've got the Live and Give box for you. It has in it the Baby Steps Millionaires book. You'll be there in a minute if you're not already. And, of course, the Total Money Makeover book as well and Financial Peace University, which did it for you guys. And you guys can, of course, give that to somebody or go back through again, whatever you need to do. All of this is for you to enjoy or to give away, the Live and Give box. So congratulations, folks.

Very proud of y'all, heroes. Thank you. You kicked it, man. That's a long run right there. It is. It's a big deal. All right, Lee and Nicole, a couple of veterinarians in Greenville, South Carolina these days, paid off $462,000 in 53 months, making $180,000 up to $305,000. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Yeah!

That's how it's done right there. It is amazing that for a math nerd like me, that when you crunch numbers and can see that you can do it, how math becomes hope. Yeah. Oh, yeah.

Nobody thinks of math being hope, right? But when you go, wait a minute, I can do that. The first time I ever saw a hundred dollars a month invested from age 25 to age 65 at, you know, in a decent growth stock mutual fund becomes $1,176,000. The power of compound interest. I thought I could do a hundred dollars and I'm only 22. That's the first time I saw it. And I thought, I'm going to be a millionaire. This is really going to be me. It,

Bing! Math gave me hope. It's amazing to me how many very, very smart people don't sit down and do that very thing. Because like him, he just ran the numbers, and then he thought, he's a smart guy. He's like, oh, I've got a path now. I can do it. I can see it. This is The Ramsey Show. Dr. John Deloney, Ramsey personality, is my co-host today. Alex is in Ann Arbor, Michigan. Hey, Alex, how are you? How's it going, guys? How are you? Better than we deserve, sir. What's up?

Hey, so I am 20 years old. A little backstory about me. I am actually married. I know it's quite a young age with my beautiful high school sweetheart of five years. My father and my grandfather unfortunately passed away just a couple months ago. They mainly helped me when it came to finances, even though they were still heavy plastic swipers. My mom kept my dad's debit card away quite frequently because of that reason.

My wife and I are kind of just at a standstill right now. The way we're saving money, I just feel like isn't right. We make about $76,000, $78,000 a year. We both do patient transport at the university hospital. And we don't have much saved up.

And we're just kind of, we've got about $22,000 or $2,200 in debt, $22,000 including our cars. We just bought our first home with a condo. And we're just kind of seeing what would be the best way and where we should start paying our debt off. Okay. It sounds like you've got the opportunity at a young age to really start a whole plan

and implement every detail of that plan to get you to where you want to go. And, uh, right now, all you're doing is just trying to make sure we keep the lights on, keep food on the table and nobody picks up anything and repose it. Right. Right. Right. Yeah. Instead of a plan, instead of a plan, you're kind of in survival. Did your, did your granddad or dad leave you any money?

Um, no, they did not. Um, they, uh, this is all of our, all of our money when it comes to, um, with the money that we use for like down payments on our condo and for, you know, down payments on our vehicles and stuff has done a hundred percent self-earned. We haven't received any money. We haven't loaned any money from family or anything. So I want you to, I want you to internalize really deeply in your heart. What Dave just said, you and your wife at a really young age,

are deciding to change everything about how y'all do marriage, how you do money, and what your kid, when he reaches to be 20, when your daughter reaches the age of 20, what their life will look like because of the decisions y'all make today. Yeah, that's a big deal. It's a huge deal what you're doing. I'm proud of you. Yeah, way to go. Thank you. Very, very good question. The

The way you're where your mind is, the way you framed the question is you're in a really good place. So what we do is we have a class called Financial Peace University that's nine weeks long and about 10 million people have been through the class now.

over the last 30 years. And so, of course, the class has evolved and has gotten better over time. But in its current form, if you go through that, it's everything you should have been taught about money before we let you out of school. But nobody teaches it hardly. So we're going to give that to you guys as a belated wedding gift. And I want you to go through the class with your wife, both of you,

attend both of you go to the nine lessons both of you buy off on here's what we're going to do you join hands you get a very clear high definition picture of where the future what the future looks like and what the price has to be paid to get to that future and when you do that you'll go do it

And you're going to be in a position to, you know, again, like John said, be you'll be very wealthy. You haven't made any huge mistakes. You haven't been thrashing around. And I think that's the gift your granddad and your dad gave you. They didn't give you any real insight in where money comes from and how to how to think big about it because they didn't have any.

We know that because they didn't leave you any. But they did kind of keep you tempered to where you haven't gone crazy like a lot of the people in the public have gone. So you've not got way huge piles of debt. You know, you've got not gone, you know, some silly numbers in the numbers you gave me. There's some trouble there. There's some problems there, but there's nothing, nothing bad.

nothing super bad so if you'll address the stuff that's there that we teach you and go do this you're going to be in a really really good position hang on austin will pick up and we'll get you signed up and get you guys to go through that at 20 years old god almighty i wish i'd gone through that at 20 oh dude don't even get me started be awesome natalie is in logan utah hey natalie welcome to the ramsey show oh my gosh hi you guys this is

So exciting to talk to you. My heart is racing, which seems to be in my living room, but I'm so excited to talk to you guys today. Well, we're excited to talk to you. How can we help? Okay, so I am a mom. I have two little boys. I've got a three-year-old and a five-month-old. And so ever since our three-year-old was born, we put a small amount of money to the side for his future. And so what I'm wondering is I recently found out about 529 plans.

So I'm trying to figure out, we've already have some money saved up. And so it's like, what's the best way to invest that for our children? Should we invest it in stocks? Should we put it in CDs? Or I guess, what do you think about 529 accounts? That's really what I'm wondering here. Well, 529 is used for education. It grows tax-free, which is wonderful. And we always recommend you put that in good mutual funds that you control.

In other words, what we're suggesting is mutual funds and the way it's treated for taxes is dictated by 529. And just like IRA is not a real investment, IRA is how an investment is treated for taxes. And so that's what you're looking for here. So if you're saving for a kid's college, 529 is the way to go.

and you can learn about them. They're really easy to learn about. Just go to, you know, go to RamseySolutions.com, click on SmartVestor Pro. You can sit down with some of the folks that we endorse around the country for helping people with the heart of a teacher with their investments, and they can help you get that started. How much have you been putting aside for these kids?

So both of my boys get $40 a month. So it's $80 a month that we put away for them. Okay. All right. Not bad at all. Good. And so, yeah, they can sit down with you and help you put that together. And, you know, that's going to,

Turn into some money. I mean, it's going to end up with some money there. An ESA is the 529's cousin, educational savings account, same thing, by mutual fund and qualified as an ESA. The maximum on it is $2,000 per year, which would be $166.67 per child per month.

And if you did that from zero to 18, you'd have about $125,000, give or take, in there, in that 529. You would have only put in about, let's see, 2,000 times 18. You would put in about $36,000. So you've got about $90,000 growth that's tax-free. And so for fully funding a baby at $2,000 a year, $166,000, $167,000 a month, you're

That sets you up. And that today would send you to an in-state school for your undergrad. That would take care of it. What's the max on a 529? It depends on the state. $10,000 a year usually. You can put more in it than you should. Or sometimes you can load it up, like three or four years, put $10,000 in.

Then quit. Set it and forget it. It'll grow. It'll grow up to be enough then, and you don't have to keep adding to it every month the whole 18 years. And I've heard recently that there was adjustment made the last couple of years that if you end up putting enough money in the 529, your kid goes to college, that they can roll that into an IRA at some point? You can move it to a Roth IRA, but the limitations on it are pretty severe. So I really wouldn't. Think that way. Yeah, I would more likely move it to another family member to go to school. Okay.

than likely. It's going to be a better use of the money, but because the formula they're using, what you can move and how long you have to wait to move it and all that, you know, there was a good idea and then they mucked it up with too many rules. But either way, it's still a great place to save money for a kid for college. If they're not going to go to college, it's not a great place because it has to be used for education for someone or that $90,000 in growth will be penalized.

And so you're not going to the fact that it grew tax free, all that wonderful idea is gone if you don't use it for that. So you got to make sure that that's what we roll up for. But here's the thing. I have never met someone. Oh, by the way, if you if the kid gets a scholarship, you can take that much out of the 529 and pay no taxes on it at all.

So if your kid gets a $2,000 scholarship, you can take $2,000 out of the $529 and put it in your pocket. That's always been the argument. What if my kid gets a soccer scholarship or is a genius? If you get a scholarship, you can take it out. But here's the thing. I've been doing this 30 years. I have yet to run into a single person call me up and say, Dave, you told me to save up for my kid's college, and I hate you. I screwed up everything. I hate you. This is the Ramsey Show.

Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships.

Dr. John Deloney, number one best-selling author, is my co-host today, Ramsey personality and host of The Dr. John Deloney Show. Own Your Past, Change Your Future was his first one. You can check that out, or How to Build a Non-Anxious Life, second number one bestseller. It just came out last fall. Check it out as well. Jonathan is with us in Fort Myers, Florida. Hey, Jonathan, what's up in your world? Hi, how are you doing today, Dave? Better than I deserve. What's up?

Um, so I had a situation happen a couple of years ago, uh, during COVID my mother passed away. Um, she was actually, uh, killed by her, um, her new husband. Oh my gosh, man. Yeah. They were both in their late seventies. Um, and they, uh, they left me with quite a bit of money. So, uh,

I had never, uh, I never made more than about 85 grand a year and then was left with a couple million dollars. And I, I hope I've been doing the right steps, um, with what I've done with it. I just wanted to get mostly some reassurance that I've been doing the right things or what you would recommend, uh, moving forward with this. Oh my gosh. How have you navigated the last few years with the loss of your mom? Um, you know, uh, the first year wasn't too well, um, you know, kind of,

How old are you, Jonathan? Okay. And I assume the husband's been put in jail? Oh, my gosh.

Yeah, in our house that we grew up in. Oh, I'm so sorry. Well, that just makes it, I mean, managing $2 million that you don't know how to manage is freaky enough, and then you put this layer on it, it just gets super freaky, right? Yeah, yeah, it's a little more than that. We were left about $2 million, $2.5 million from our parents, and then he left us another $1.1 million. Oh, wow.

which we weren't expecting. We didn't know that we were written into as well. Wow. Does that money feel weird, or are you happy to spend it? I wouldn't say I've spent it. I've used most of it to live off of the last couple years from the new husband. He left us two IRAs, a traditional IRA and a Roth IRA. Mm-hmm.

So I've been pulling out. Let me get past all the, and just answer your question. So how much money do you have today? Today, let me just flip over here. I've got total between properties and everything. Yes. I would say about $3.5 million. Okay. And you're still working, making $80,000.

No, I haven't been working since the day she died. Oh, wow. Okay. What did you do for a living? I worked in restaurants mostly, bartender, sommelier, and server. Okay. And the reason I didn't go back to work was a lot of that, the reason why I made good money was because I was always forward about my life and talking to people about things in my life, and I just felt like I couldn't do that anymore. Well, you can't.

Go into this story, part of the story anyway. Wow. Okay. Are you married still or single? No, I've never been married. I'm single. You said you had kids. Okay.

Yeah, two children, one that I have full custody of, one that I split custody. Okay. An important part of your recovery moving forward is you're going to have to get a job. You're going to have to get a purpose, a thing to do, a thing to go to, a thing that you are a part of that the world's going to be better because you were a part of it. You got that? Yeah, I feel that as well. Okay. Yeah, it's time to go back to work, Jonathan.

Yeah, I'm actually starting a business this year, a tour boat business. A what business? Tour boat? A tiki boat, tour boat. Oh, okay. All right. You're buying the boat and going to do tours. Yeah, and do trips on the boat. When? The boat's going to be delivered in April or May of this year, and we should be operating by June. Okay. What did you spend on that boat? $220,000 total. Okay. Okay. All right. Now, you're going to be...

leaning in, learning how to run a business, learning how to handle and operate the boat. You're going to be leaning in on all of this. I really want you to go make a living for your sake because at 36, doing nothing is not a plan, okay, emotionally, spiritually. John's right about that. Now, so let's pretend that you're making a living. You don't need this money then, right? So now we just need to invest this money well. Yeah.

Yes. Okay. Jonathan, I buy two things for investments. The first thing I tell people, and I was with a bunch of wealthy people this weekend, do not put money in something you don't understand. Don't do it because I do it. Don't do it because somebody else says to do it or you read an article once. That's a nightmare way to lose money. Put money in something you understand. Now, that may mean you need to go to school a little bit by sitting with an investment advisor and letting them teach you.

But I buy real estate that I pay cash for because I like the real estate business. I've done that already. Okay. And I buy mutual funds, and that's all I buy. Okay. I've got about a total of about $1.8 million in real estate. Okay. And it's making money, right? I have one house that's going to be worth about $1.2 million, and I'm planning on renting that. Mm-hmm. Going to be. When? Why is it not worth that now? Yeah.

It's about to be finished being built, and I think in March or April of this year it'll be done. Okay. All right. So you're going to have some. And then I have another rental house, and then I have the house I live in. Okay. That's fine. Great. Now manage those to where they make a good return on the amount of money you have tied up in them, and then sit down with a good, someone like a SmartVestor Pro. You can find them at RamseySolutions.com, and they'll help you sit down and start to understand some mutual funds and invest it.

But, I mean, if you make 10% on $3 million average across those investments, then you'd have $300,000 a year coming in. If you don't touch it in seven years, that $3 million at 10% would be worth about $6 million. In seven more years, it'd be worth about $12 million. In seven more years, it'd be worth $24 million. That's 21 years from today. You're 36. That puts you at $57 million.

with $24 million. I like that. Okay. That's you working, providing your own living, not touching these investments and letting them just grow at an average growth rate of 10% a year. And that's invested in mutual funds and real estate. Now, it's a little more complicated than that, but basically that's how the math will roll out. The trick here to the thing is put money in stuff that's steady and is predictable and

Not super conservative, but we're not taking any big risks here. We're not trying to reinvent the crypto world or some bull crap like that. And don't buy a tiki boat for a quarter million dollars and then six months go and be like, well, I'm going to do this and I'm going to buy a snow cone stand and then you're going to small business yourself broke. Yeah, stay on track with that. And so you're now in the tiki boat business for the next decade, buddy. And you're going to make a go of it. John's right. You don't get to change.

This show is sponsored by BetterHelp. Hey good folks, the back-to-school madness is upon us. It's hitting us right now. We got travel and work and all these forms to fill out now and sports to travel to and on and on. My family's schedule is so packed and we haven't even begun talking about things like exercise and date nights and counseling and church and home projects. And those are the things that make our life even worth living.

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Call my friends at BetterHelp. Visit BetterHelp.com slash Delaunay today for 10% off your first month. That's BetterHelp, H-E-L-P dot com slash Delaunay. Dr. John Delaunay, Ramsey Personality, is my co-host and is with us in New Orleans. Hi, Ann. How are you? Hello. I'm fine. Thank you so much for taking my call. Our honor. How can we help?

Okay, my question is, my husband and I, my ex-husband and I, were a co-signer on my son's condo back in 2004. And since that time, my son is unable to pay his mortgage because he's unemployed. He lost his job. Since 2004? No, no, no. He purchased the condo in 2004. This past April, he lost his job.

And he's been unable to pay the mortgage. How many times did you pay it since 2004? Oh, it's happened before, about 10 years ago. He ran into trouble paying his mortgage, and he was able to do a forbearance. And, of course, I assisted financially at that time. And you keep using the word unable. Is he unable or is he unwilling? Why do you not have a job since April? One of my best friends in the world is a paraplegic. He is unable.

No, no. He's physically capable. He has not, and he has not found a job since April. He says he's looking and he can't find a job. One of the hottest hiring markets in human history. He's chosen not to work. I guess so. Okay. Let's use, I just want to be, I just want to call a spade a spade because it helps us make decisions, right? Yeah. Now you're still on the mortgage.

Yes. My ex-husband and I are co-signers, so we're responsible for paying the note if he does not. And he's not been paying it. Yes. So I have been paying it since April. My ex-husband made about three of the mortgage payments. So now I want to know what would be the best avenue for me to convince my son to sell it, let it go for foreclosure,

And I told them, or else you get a job and you pick up the payment. But I don't want it to go to foreclosure because I don't want it to affect my credit. My credit rating is 820. Every time it's paid late, it affects your credit. Yes, I understand.

So I just don't know if there's any options for me. Is he on the note at all? Is he on the note? My son is the owner of it. Yeah, he's on the note. She's the co-signer. You can't force him to sell it. You can just talk him into selling it. Will he sell it if you tell him to? No, he's dragging his feet about that. Well, he's dragging his feet because he knows you're going to pay. For 20 years you bailed him out.

Yes, I understand that. And you've probably given him some stern talking to's over the last 20 years. Yes, I have. You still paid it. So, yeah, he's dragging his feet because you taught him how to. I think you have to sit down and say, I'm not paying this rent. Dave, I'll leave it to you. I mean, it's going to ruin your... Yeah, you're going to get foreclosed on if he gets foreclosed on. That's how this works. Can you afford to buy him out? I could. I could.

But I just don't know what my best options are because if I buy, if he would sell me the condo, then it's mine, right, for me to do what I want with it. Exactly. And then you just sell it. Then you sell it and resell it and get your money back out, and at least that way you didn't lose anything. Yeah, you could just say, all right, let's give it a praise and I'm going to buy it from you, and then you put it on the market and sell it. That's what's best for you.

That is unbelievably aggravating, and it's not necessarily what's best for him. What's best for him is to experience some pain, but he's not going to in this scenario unless you do. That's the problem with cosigning. You get to experience the pain with him. And he's going to play chicken with you, and you've got a lot more to lose than he does financially, right? Yes, I do. What's the condo worth? Maybe about $40,000.

Worth? 45. No, well, he would be lucky if he could get 60 for it. Oh, my God. What do you owe on it? 30. Okay. And he's got 11 more years. Okay. Go tell him that...

You know, he can no longer screw up your life with his laziness. He needs to sell you this condo. Even if you buy it for whatever, have a real estate agent give you an appraisal, buy it for that amount, put it back on the market and resell it. And he needs to move.

Okay. Yeah. That protects you. I'm for some reason, I thought this was a $600,000 condo. It's a 60. Yeah. Just, you can, you're, you're, you may lose a couple thousand bucks here or there by moving all this gyration around, but you need to get out of this trap. You put yourself in and the trap is co-signing.

You can't get out of the trap. You're either going to be an enabler or you're not going to pay, and then he's going to get foreclosed on, which means you're going to have a foreclosure on you, and then they're going to come around looking for all of you, wanting some money out of y'all because the condo won't bring enough at repo to even cover the old mortgage on it. But it's a piece of crap condo to start with. And I'm the one. Ann. I'm sorry. Will you forgive yourself for the divorce finally? Yeah. Yes.

You're still trying to make that right with him. Stop. 20 years. Yeah. You're going to lose some money, but you're also going to lose your relationship with your son. It's not worth it. Yeah. I would buy it from him, have him move out, and turn around and put it right back on the market and sell it. And if you lose a little bit that way, that gets you out of this trap. And then you have a standalone relationship with your son that's mother-son that is no longer co-signer.

Because cosigner is putting a strain on everything. It's making you do things you don't feel good about. And it makes you resent your son. Every time that phone rings, you feel your chest tighten up because what's he going to ask? It's altered your relationship. What's he going to ask for now? Because you're aggravated with him like we are for being lazy, not working since April. My God, how much does it take to pay the condo note on $30,000? I mean, you can do Uber one day a month and pull this off.

This is about the laziest human I've run into. Uh, pretty rough. I mean, really? Yeah. Think about it. It's just, I mean, it's not like it's a lot of money. Hey, I don't even know how the boy's eating. Well, we all do. And yeah. And state making sure he's got groceries. Yeah. So, and you got to stop it. It's time. You put him on, put him out and let him figure out how to do life and just love him from a distance. Uh, that doesn't include your checkbook for the rest of his life. And that's the biggest favor you can do him and yourself is,

And moms and dads out there never, ever co-sign. It's not an act of love. It's not. It's the ultimate enabling, and it locks you into enabling because out of self-preservation, you have to cover the stupidity of the other party. What about this, Dave? I'm trying to think of how this situation for her could go wrong. Is there a moment when, and again, I know I'm speaking in ratios here, but $50,000 against what Ann has is not a lot of money.

Can she buy this thing and hand it over to him and dust her hands off, walk away? Is that too much enabling? I wouldn't do that, no. Yeah. No, I think it's... I think he's not going to move is what I think. He's not going to sell it. To his mom? Yeah. Oh.

Well, then I would just take the pain of being foreclosed on. You would? I'd just stop. Okay. You're either going to sell it to me or the days of me giving you money are done. They're over. And that's what I'm getting at. It's protecting yourself. Either you're going to sell this to me or you're going to have to figure it out. Okay. I'm done. Okay. Because this is so bad for him. Yeah. She stunted his emotional growth.

I mean, he's six years freaking old. Yeah. He can't get a job since April to pay condo notes on $30,000. This is lame. Yeah. This is really a lame boy. Especially when we talk to elementary school teachers trapped in a New York apartment during COVID who pay off six figures because they drive and scratch and claw and flip and do whatever they got to do. Yeah. Right. Right.

It's tough, man. A kid could sell enough clothing out of his closet at a consignment sale. Plasma your way to that one. It's just not any money. So, yeah, honey, you've got to get him free of you, and you've got to get free of him in order to have a decent relationship with him and in order for him to ever be a real man. And it's going to cost you that precious 820 that you're really proud of. It's going to cost you that. Who cares? Let that stupid thing go. Oh, my gosh. That condo's never been laid.

She's paid it on time every time. Every time. It's never been late. It wouldn't be 820. This is The Ramsey Show. Dr. John Deloney, Ramsey personality, is my co-host today. Ryan and Haley are with us on the debt-free stage.

Yep, right here in the lobby of Ramsey Solutions. How are you guys? Great. How are you? Better than we deserve. Where do you live? Lewisburg, Kansas, about 45 minutes south of Kansas City. So, yeah, you need to be wearing some Kansas City gear today for sure. Oh, yeah. Of course. Wide right, baby. Here we go, man. Here we go. Way to go. Good stuff.

So how much debt have you guys paid off? $458,680. Wow. Love it. How long did that take? Six years. Six years. And your range of income during that time? Well, when we first started, it was around $100,000. Our peak was $260,000. And we went down to $112,000 now. Okay. That was with the job change. Okay. All right. Very cool. Good, good, good. And...

$459,000. What kind of debt was this? A little bit of everything, of course. So we have a few cars that we paid off. Of course, our student loans we paid for. Mm-hmm.

Credit cards and our house. Paid upside. All right. Looking at weird people. Yes. I love it. Very good. Great job. What's this house worth? It's right at $350. Good for you. Man, that's awesome. How old are you two? 35. And have a paid-for house. And now don't have to work as much. Still took a different job and downsized one job and all that kind of stuff. Finally got to do the thing he likes to do. He doesn't have to work. Yeah. You know.

Very, very cool. Excellent job. Excellent job. Well, for those of you out there in America that don't know, we have a program here at Ramsey called Smart Dollar, and it's from the financial wellness side of things. What happens is companies buy Smart Dollar and provide the financial curriculum free to their employees.

and it's having a massive impact on employees all across America. U-Haul had a bunch of their folks come on here a few months ago and do debt-free screams. We've had, you know, Costco has taken their folks through it. And companies of all sizes, not just huge ones like U-Haul and Costco. But I understand that your company bought

Smart Dollar and that's what got you guys started is that right? That is for the most part I mean we were already doing the program really before but it just added an extra when we started working there because I started working there about eight months ago. Oh okay so you were well on your way and this just helped you the new job that you got that you love is the company that has Smart Dollar. Yep. Well that's good news. It's great. Okay.

So a little bit worried about it there for a minute. All right. And so your company name that furnishes smart dollars, what? Strategy LLC. Strategy LLC. What do they do? It's a marketing company, web development, and then IT. Okay. What do you do? I'm in the IT side. Okay, cool. And Haley, what did you used to do? I'm a nurse. You are a nurse. I am. Okay, good. Very good. So what happened this many months ago? Even before Strategy LLC was doing it, you guys were already doing it.

game on and then you 60 months into this or six years into this you knock it out what got all this started John's right well we you know we got married back in 2017 and then you know we started making some decent money and so when you make decent money you go out and buy new things oh of course bought three new vehicles within like six months brand new so you know a lot of depreciation for two drivers for two drivers that makes sense yeah yeah they're toys too so motorcycles you know all that so

we, uh, bought those. And then, you know, when we're paying 2000 a month on just payments for three vehicles, um, yeah, it kind of is overwhelming. It was a wake up call. Yeah. Kind of a wake up call kind of thing. So then our son, we, uh, he was born 19. Uh,

He's staying home today, but he was born 19 or 21. Sorry, 21. And we were like, we just want to have a good life for him. And so we just kind of buckled down before and just went after it. So. Okay. Very fun. So you ran into us earlier. Yes. And then it was just added on to when you went to work for Strategy LLC. Yep. Okay. It was an awesome program. Haley, how did you convince him to sell the motorcycle? We didn't.

They're all paid for. And we got to keep them. You just paid them off, okay. We paid them off. She's smiling. We got to keep them. She's riding them. We did. She has her own as well. So what are these bikes? You married well, Ryan. Harleys. They're Harleys. I've got a Street Glide and then she's got a Sportster. I love it. Very fun. You are so much cooler than I am, Haley. It's embarrassing. That's a very low bar, but you're way cooler. Man.

Yeah. Way to go, you guys. Thank you. And you're how old? 35. And you have a paid-for house for $350,000. Mm-hmm. How's that feel? Amazing. It's amazing.

It's just different. I mean, it's hard to imagine it, really. We actually paid our last payment, and it was like October 1st, I think we did, and it's still not settling yet. We had made the goal to ourselves that we wanted to pay it off by Christmas, and that would be our Christmas present to ourselves. So we really cranked down and...

worked extra shifts and he was working a couple of extra side jobs to make the extra money and we were able to pay it in October not in December. Love it yeah very cool very cool man that's a it's a great place you are six years is a long time to crank on this how did you stay with it?

Well, we really were like hyper focused on in the last two years, mainly. We really enjoyed like your podcasts and the books and everything that we've been reading over the years. But the last two years are really when we've been cranking down and focusing on it. A lot of our culture will tell us that success is a dollar amount. And we don't often ask the question like,

What I actually want to be doing, we just get good at something and then they reward us with money and we do more of it and we do it faster and then all of a sudden we're making great money and everyone's telling us, look how lucky you should feel and inside you're dying, right? Oh, yeah. Talk to the person who feels like they have golden handcuffs. They're stuck because, quote unquote, they make all this money and they're like,

you look like a guy who's free. Y'all look like a family who's free and y'all made a choice to basically cut your income in half, right? We did. But it looks like it was the right thing for y'all. Yeah. You just gotta, I mean, as long as you, you know, focus and you work and if you have a spouse, you work with them together. You have to do it both together. It can't be separate. And that's the biggest thing. We just were,

we were helping each other, kind of feeding off each other, and I think that's the best thing. Or if you don't have any spouse or anybody, you've got to find somebody to keep you accountable. Yeah, absolutely. Did you get some positive peer pressure with the guys at your company all doing this at the same time? Yeah. I mean, they're actually – it's actually pretty cool because they're all – nobody paid the house off, and they're all like –

Now we want to do this too. Yeah. You're inspiring them. That's kind of, yeah. It's a very good feeling. I mean, we don't like to, you know, we're not those type of people, but it's kind of really inspiring and stuff, even for us to be here. Well, there's a difference between bragging and setting an example. Correct. And you just set an example. Well done.

Good for you guys. I'm so proud of you. Thank you. Thanks. Who was cheering you along? Who was telling you to go for it? I mean, really everybody. Yeah. Our whole family, both sides. My son. Yeah. Our son. He's, even though he's only two, he's just been our, like emotional support guy. He's been hanging in there with us. Yeah. My, my dad started me a lot when he was, we would drive around. He'd be listening to your podcast and this was long, long time ago. And,

just never really did it and uh you know my dad passed away in 19 and so we uh that was one thing i wanted to do is i wanted to finish this i wanted to do this and kind of you know for him so yeah yeah absolutely well he's smiling oh yeah smiling from heaven right now yeah what a way to honor your dad yeah and that's cool yeah very awesome

All right. We've got the live and give box for you. That includes the Baby Steps Millionaires book. You're on your way to that for sure. Total Money Makeover book, Financial Peace University. You'll be able to give that away since Strategy LLC is furnishing smart dollar to their whole team and tell them thanks for us. We appreciate it. Sure. That's pretty incredible. This is what happens, employers, when you...

When you furnish something like financial wellness like this to your smart dollar program, to your employees, they're set up to win like this. This is incredible. All right, Ryan and Haley. Wow, Kansas City, $459,000 paid off in six years, making $100,000 to $260,000. Count it down. Let's hear a debt-free scream. Ready? Three, two, one. We're debt-free! Yeah! Yeah!

Love it! Woo-hoo! Love it. Way to go, you guys. Hey, you mentioned something, Dave, that I don't want us to lose. Now that that company put this benefit out, they're really successful. He's going to be a better employee. Yep. He's going to be a more peaceful employee. Yep. They get to pay him less. He's going to knock it out of the park for them. Yep. Smartdollar.com. Check it out, boys.

Dr. John Deloney, Ramsey Personality, number one best-selling author, is my co-host today. Dan is with us in Greenville, South Carolina. Hi, Dan. How are you? Hey, I'm good. Hope you guys are doing well. We are, sir. What's up? So a question for you about the... I'm on an all-commission position, and in reading your book, in regards to the Hills and Valleys account that you have set up, I'm wondering

So I've got myself budgeted out to the end of April, and then I've got about $12,000 extra on top of that. Do I throw that extra $12,000 straight at debt, or should I be adding another line item into my budget? No, just throw it at debt. Are you in baby step two? Correct. Yeah, just list your debts, smallest to largest. Every excess dollar you can squeeze out of your budget above your basic living expenses is

um you throw it at that now do you have any money do you have down months below where you never where you don't even make enough commission to cover your basics yes yeah so commercial real estate so for instance um december commission check was 67 000 for december but the first the the probably six months before that it was zero to a thousand dollars you know

So it really varies. And so I have to budget myself out for months at a time. And my worry is that I throw some extra money when I have it at some debt. And then maybe a deal doesn't go through or a deal gets extended. And there I am with a paid off car, but I should have had money in my account. So that's what I'm struggling with there. Yeah. You know, what we're trying to do is reasonably predict the volatility. Right.

And how long have you been doing this? Three years. Commercial real estate. Okay. I mean, you probably could get some comfort from looking at the patterns if you went back three years. You should see a trend line up in your income overall. Your overall income should be going up over three years. You should be making more three years in than you did the first year, right? Correct. Okay. And you can tell if there's some kind of a rhythm at all to, you know, about how often you see checks coming and going.

But, um, but yeah, you just, you know, the, the Valley account, if you're going to have an extreme volatility like you do, where you literally have zero or have a thousand dollars or something, um, then you've got to set aside money for as many months, um, in that Valley account. Cause you're in a Valley, uh, to cover your basic needs till you get another check in. Yeah, that's exactly what we're talking about. So, um, you know, there's not a, uh,

We have to try to predict the future is what we're doing, right? Which, of course, is an imperfect science. But, you know, if you had six months... This is not your emergency fund. This is money to eat with, okay? This is us planning to make no money for four months. So we set four months of basics aside in a separate account. That's called the Valley Account. You do that when you have a hill like December with $67,000 in one month. So...

The trick is to try to ascertain with some kind of pattern, if you look on your look back, you know, how often am I going to have to dip into this account to eat and to keep the basic lights on. And everything above that, then, you need to dump. But you should reach a point where you're getting something every month. You should not continue –

to have zeros the rest of your life. I mean, you ought to be able to get your pipeline full to where something is coming out all the time. Now, it might take a little while to get there. It might be every other month or something, but...

Otherwise, I'm going to put something else in your mix. You're only elephant hunting, and I'm going to put a few rabbits in your mix as well. I mean, let's try to do some lease deals or something that's a little smaller, a little more quick to close, that kind of thing, than just selling the $35 million apartment complex or whatever. If you're only hunting elephants, you may have this the rest of your life. But you really do have to get something built up to where –

You're not sitting around hungry waiting on one of these checks. You're right. But the magic is to predict the future. That tells you how much you've got to set aside for how many down months you're going to have, and that's very difficult to do in your world, but that is the concept. You nailed it when you called in. Thanks for joining us. Nothing quite like, even in something as sophisticated as commercial real estate, nothing smells bad like a salesman that's broke. Yeah, and I...

the analogy you gave is good and i think i could put that on everything uh marriages on work relationships on jobs so often we sit around waiting for the perfect situation it's got to be a home run or i'm not swinging the bat and you end up striking out a whole bunch right or you get real hungry uh and then it makes you not an effective salesman yep and but that elephant hunting man finding another way to get some money that's i was going to ask him like

For those four months, are you making calls all day? Are you out surveying properties all day and you just can't get anything? Because that may not be your calling, man. In four months, you got nothing. Man, that's tough. That's tough. Yeah, and one $35 million deal does not take four months of...

40 every day 40 hour work weeks that's not how it works right it's all you're you know when you're on you're going to be on but you're not there 40 hours they got to talk to their team and their banker and their people and but not for 40 hours a week for four months you need to have other stuff in your pipeline and that's the nature of the real estate business i've been in it my whole life in one way or another all right deborah is with us in milwaukee hi deborah how are you

Hi there. Thank you for having me. Sure. How can we help? Okay. My daughter's actually introduced me to your name in December. Okay. And I've been listening to you quite a bit. So real quick, I'm retired. I've been retired for a while, and I'm $25,000 in credit card debt. Ruh-roh. Yep. Ruh-roh was right. Okay.

I guess as I've listened to you guys at different times in this, and I see that I've turned that blind eye to what was happening. And so when I just look at everything, I don't know how to start everything. So I've signed up for everything that you have. Oh, my gosh. I got the book the other day. So how old are you? I am 68. 68. And how much in credit card debt have you run up?

$25,000. $25,000. Do you have any money? No. None. I mean, well, you know, I only have about $20,000 in my 401k because I've messed, well, about $30,000 because I messed that up too. What are you living on? You have a retirement income from your old job? No. That's done. And I get $38,000, $79,000. That's my income every month. Mm-hmm.

Is that Social Security? Yeah, that's our Social Security. Social Security, I get something from a job that I worked for for about 10 years back in the 80s. How's your health? My health is okay. Okay. My health is okay, and I have a condo that I own outright. Good. That you live in? No, I do not. I live in a home with my husband. Oh. What does your husband make, pray tell? Um...

He makes over $100,000. And I'm going to tell you, I listened to your... Deborah! He and I have always been separate. Yeah, not anymore. Now he's married to a woman that's got $28,000 in debt and he's 68. I thought you were a single 68-year-old lady living on Social Security and I was about to put you to work until I discovered you have a husband that has $100,000 income. And now I'm about to take some of his money to pay off his wife's debt.

which is what he needs to do. Tell Bubba to step up and take care of this. And by the way, you need to cut up your credit card, sister. Chop them all up and never do that again. But you guys are, you're together. If he gets sick, you're going to take care of him. And right now you're sick and he's going to take care of you. And y'all have been playing house for a long, long time. And now y'all need to have a conversation about what the back 20 years is going to look like.

And that's going to be all working together financially, health wise, marriage wise, house wise. Y'all got too much money. You got an extra paid for a house over here. You got too much stuff going around to be this broke. And they're scared about it. Yeah. Unable to breathe because of social security. The magic. Listen, the plans are important. The books are great. Sometimes the magic is in that hard work or in that really hard conversation. That's where you are. Yeah. You guys need to sit down and talk about this and

He needs to help you pay it off. Silly to sell a condo to pay off this when he makes that kind of money. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships.

Ken Coleman, number one best-selling author of the book Paycheck to Purpose, host of The Ken Coleman Show, is my co-host today. Thank you for joining us, America. Open phones at 888-825-5225.

Ken, long before there was a Ken Coleman, when I first started this broadcast a long, long time ago, it was called The Money Game. Yes. And back in those days, 30 years ago, we were on in Nashville only. And a friend of mine that I had known from church put a book out helping people like you do in the career space, 48 Days to the Work You Love. His name's Dan Miller. And

And, uh, Dan and his wife, Joanne have been friends of Sharon's and mine for almost 40 years now. And, um,

48 Days became a perennial bestseller, sold millions of copies and helped millions of people in the same space that you're in with their career and selecting the right passion and all of those kinds of things. Dan and I were in a Bible study with a bunch of high-performing guys. We call it the Eagles Group. We met every Wednesday morning for 14 years.

And, uh, that group disbanded. It ran its course several years ago, about a decade ago or so. And Dan moved, he and Joanne moved to Florida and he, uh,

He called me in December and told me he had a very aggressive cancer. And he went home to be with Jesus last night about 9, 915. And so lost a dear friend and a guy that's an icon in the space that you're in for sure. Yeah. And has helped a lot of people in that career space. So we'll honor him today and continue to cry and pray with his family. And so just incredible, incredible friend, incredible man.

Great dad, great husband, too. That's what people sometimes behind the scenes, you don't know what people are. And this guy is like the real dude. Well, you know, he I had the privilege of having dinner with a couple of guys that he has mentored and about my age.

And just the way they talked about him, of course, I got to know Dan was on his show and he interviewed Dan on my show as well. And, you know, when you think about someone's legacy, it's the impact that they leave behind. It has nothing to do with the public stuff. And he had a tremendous impact there. But just the way he has impacted people for decades, pouring into guys in a mastermind group. I got to talk to two of these guys and they just they both teared up just talking about the impact that he had had on their lives. Yeah, which is what it's all about.

Absolutely. Quite a legacy. Yeah. Quite a legacy. Great man. Quite a guy. So our condolences to our friends there, and just take a second and honor the work that he had done. It's absolutely incredible. All right, Billy is with us. Billy is in Atlanta, Georgia. Hi, Billy. How are you? Hello, Dave. Hello, Ken. How are you guys? Better than we deserve. What's up? Well, my wife and I want to make a new car purchase for the first time in over a decade, and I just want to make sure that

It's going to be a pretty sizable car purchase, and I just wanted to make sure that this makes sense from your perspective. We've been followers of yours for quite some time now, and I would just like to get the Dave blessing if I can. Well, it's not something that's required for a car, I can tell you that. If you've been following us a long time, you know that we don't buy new cars unless you have at least a million-dollar net worth. Are you talking about new to you or a brand-new car?

It's a brand-new car, and the only reason why I'm calling in is because before I was about $10,000 underneath the millionaire status, and now as of this morning, I'm $3,909 over the millionaire status. Just crossed the finish line. All right. So you're sure you're ready to go on that one, all right? And you probably also know we tell folks, regardless of their level of wealth, not to buy things with wheels and motors all added together. That equals more than half your annual income. So what's your household income?

About half a million dollars. Wow, you're killing it. What do you do for a living? I'm a solutions architect at a technology company, and my wife's a tech sales executive at a startup. Phenomenal. Way to go, you guys. Well, it sounds like you're going to be able to afford this car. What is it? What kind of car? It's an electric SUV. It's a Rivian, and I know you're a car guy, so it goes zero to 60 in three seconds. Yeah, I know the Rivian, yeah.

I was talking to a guy. I bought one the other day. I parked beside him at church, and I parked my Raptor beside him. We were talking about it as we were walking into church. It was a great conversation. It was a lot of fun. I'll bet. So it's a wonderful vehicle. I mean, if you like the electric stuff. I mean, it's incredible. The engineering is very cool. What is that thing, about $90,000, $100,000? Out the door with tax title license and everything, $98,000. Yeah, okay. All right. And I assume you've got the cash.

Yes, I just crossed $100,000 on the high-yield savings account, so I wanted to pay for everything, you know, the insurance for the whole year and everything as well. So unless your wife is driving a $150,000 vehicle, your two vehicles would be under half your annual income, and you're over a million dollars, and you're paying cash. That's the only thing we tell people to look at.

Awesome, awesome. Yeah, and we're driving right now like a 10-year-old Hyundai, and we're still going to keep it until it dies just for, like, memory's sake. Yeah, yeah. I mean, apparently the engineering on this thing is incredible. I've not driven one of them. The only thing I worry about with a brand-new manufacturer on anything is I end up owning a DeLorean or something, right? Mm-hmm.

Yeah. You know, or Studebaker or something that goes out of business, you know, and then leave you, you know, they make them for three years and they're gone. I don't I don't have any reason to think that this company is going to do that. But I'm just saying and just as a general comment. But can you afford this? Yes, you can afford it, sir. And yes, you should go buy it if it's what you want.

Amazing. Thank you, Dave. I really appreciate it. Very cool. That's fun. Very fun. He walked through it. I don't get to do that very often. Most of the time I say don't buy the car or sell the car. Right. Usually when they call saying I need your blessing, it's because they feel like they're going to do something stupid that's stupid. Please save me. But this guy had walked right through it. I'm with you. I still wouldn't do it. It's just a car taste.

I would do it. I'd get a year old one or something like that because it is a new manufacturer. But, you know, I guess it's coming with all the warranties and everything. But it's brand new. I see them driving all over the place. Oh, yeah, they're great. They got a dealership about a mile and a half from my house in downtown Franklin. Okay. So I see them. They look cool. I'm telling you, it's a BA car, man. It'll ride. It'll go. It's faster than a Tesla. Zero to 60 in three seconds. It makes a Tesla look, yeah. What's the, is it a foreign manufacturer, I guess? No, they're U.S. It's U.S.? Yeah. Okay. All right. Didn't even know.

Yeah, it's crazy. But, ah, man, it's expensive, too. But it's good. Hey, that's what he's earned. This is why you work for it. That's right. You live like no one else. So later you can live like no one else. Freaking making a half million dollars a year. Got a million dollar net worth. Young guy. Yeah. But and it saved up the cash to do it. Yeah. And that's what he's making a big leap up. Big jump from. I feel bad for the poor Hyundai for a hoop. The 10 year old Hyundai is going to feel bad when the new shiny vehicle shows up. But they're going to keep it. I like it.

Yeah. So what's the thing on the Hyundai is all getting stolen? Have you seen the TikTok thing? No. You know, Dave, I'm not on TikTok. I'm not either, but I heard it this morning. I don't have the foggiest idea. I heard it this morning in a different setting that it's hard to have, that there's some kind of a...

This is true. A guy in the audience is shaking his head. It's hard to get insurance on them. They're getting stolen. Why? Because somebody put out a hack on how to get one started, how to break into it, and all these people are using that hack. Oh, I see. And they're stealing Hyundais. Okay. Like crazy. So you Hyundai people, be careful out there. Wow. Wow. Get the low jack. Who knew? Who knew? This is The Ramsey Show.

Ken Coleman, Ramsey Personality, is my co-host today. Hey, folks, we want you to join us in Nashville for a brand new event that we just launched the ticket sales on. It's called the Total Money Makeover Weekend. It's going to be May 10th and 11th. There's millions of you out there who have been listening for a while and are still sitting on the sidelines. No more sitting.

It's time to do it. Time to take action. In just one weekend, we're going to give you a crash course on everything we teach you about money, and you're going to hear brand new content in addition to that from the Ramsey personalities on budgeting, beating debt, investing, careers, and more. No matter what baby step you're on, this event will light a fire under your butt, and you'll make progress.

All the Ramsey personalities, including Ken Coleman, am I right, will be part of this weekend, the Total Money Makeover weekend. It's going to be live question and answers all throughout the weekend, lots of opportunities for fun and pictures and everything else. It is a total immersion. So come join us, May 10 and 11. Early bird tickets went on sale just a couple days ago.

at $99, and they are for a limited time. We're going to up the prices as we go along. So if you want the best prices, you do it now. Get your tickets right now at ramseysolutions.com slash events. The event center only holds 2,500 folks, so you do need to get your tickets as soon as possible, please, for your sake. Cassandra is in Colorado Springs. Hi, Cassandra. How are you?

Hi, guys. I'm good. How are you guys? Better than we deserve. What's up? So I'm curious about doing a HELOC to consolidate our debt to pay it off quicker. Hmm.

So, um, we have about 55,000 that we are wanting to pay off, but what I was hoping to do was to do the HELOC. Um, so pull out the 55,000 and then do about a $400 payment a week. So it would be either an automatic withdrawal or we do, well, automatic is easier. So if we do the automatic withdrawal, um, and then I'm,

I'm hoping it would be paid off in about three years. Not at $18,000 a year it won't be. The interest is $18,000? No. $400 a week is $1,600 a month. That's $19,000 a year times three is not $55,000. It might get there. You might get there, but it's going to be tough. Yeah, you'll get there, I guess. Okay, so what kind of debt is this?

Um, we've got about, uh, just under 10,000 on a credit card and then the rest are auto loans, no student loans, and this is not including the house. So what's your household income? Uh, like after taxes take home, it's about 7,100 a month. Mm-hmm.

Husband has two jobs, and then I also work on commissions, so I get bonuses. And so whatever we get in those extra incomes goes straight to debt, but I'm wanting it to go faster. Going faster will be about you guys sacrificing and cutting deeper. It won't be about interest. Interest rate's not your problem when you have only a two-year or a three-year problem.

Your problem is just straight cash flow, and you can increase that, of course, by increasing income or decreasing outgo, which is sacrifice. The problem with moving this onto your home is you've now put your home at risk for your misbehavior, and your misbehavior was you bought things you couldn't afford to buy.

Right. And now recognizing that and changing that behavior. Yeah, maybe. 88% of the people that do debt consolidation end up going further in debt, not less debt, because they don't change the habits and the behavior.

I personally would tell you to never do it. I would list these debts smallest to largest. I'd cut up the credit cards. I would sacrifice so deeply that people think you joined a cult. I'd sell so much stuff the kids think they're next. I would go crazy and get this done in about two years.

with your income and live on nothing, not going out to eat, not going on vacation, not looking for an easy way out, attacking this with an absolute freaking vengeance. That's the formula that we have seen that has the most success. Because here's the thing. Debt is not the problem. Debt is the symptom. And interest rates, when you run the actual math, are not what's killing you here.

especially when you pay those credit cards off really, really fast because they're going to be the smaller of these debts. The cars are going to be the larger of the debts. And so when you list these things smallest to largest, pay minimum on everything but the little one, attack the little one with a vengeance, credit cards are going to be the first thing out the door. They're going to be gone. And so now your interest rates are not going to be substantially different from that point forward between that and the HELOC, and you put your home at risk to buy a car.

or in this case, to keep a car that you shouldn't have bought. Yeah. The key that we have seen, Cassandra, in all these years, when Dave talks about, you've heard him talk about it over and over and over again, gazelle intensity, the word there is urgency. And here's what happens. When you take the route of the HELOC, you remove all urgency. And

In fact, the way you laid it out to us was so relaxed and we'll pay $400 a week and in three years we'll pay it off. And that's where the, that's where things go awry and Dave's right. And the data backs him up. So urgency is we don't rely on the HELOC. We don't rely on a steady monthly payment to get out of this. We get after it right now. We sell a car. If we've got some equity, we drive a,

a car that maybe we wouldn't choose to drive. You know, we work two and three extra jobs. We sacrifice like Dave talked about what's going on there is urgency. And when your, your urgency is driving behavior, you're going to see faster results. And you see permanent behavior change. That's correct. Cause you don't ever want to do that again. You don't, you don't see that when you just ease into it. That's right. The HELOC is too easy. Yeah.

I'm going to keep eating donuts, but I'm also going to start having a protein shake. I'm going to walk five miles a day, but I'm not giving up the donuts. That's right. And six Big Macs at lunch. And so, yeah, that's...

That is the equivalent of what we're talking about. There is a thing. So you asked, and so we're answering you fairly, and that is I wouldn't do it because when you lean into this with that urgency, with that level of sacrifice, you'll never go back. It causes the behavior to permanently be changed because you never see it the same way again. This is not a math problem. It's a behavior problem.

And when you address it through that lens, it changes the answer dramatically here. Never would I see you go out to eat and you put a steak on your credit card and then you put your credit card on your home. You've now financed a steak on a HELOC. That's a great way of looking at it. I mean, that's just when you think about it, it's just nuts. All right. Roger is in Tampa, Florida. Hey, Roger, welcome to the Ramsey show. How are you doing, Dave? How are you doing, Dr. John?

Great. Ken's with me this hour. What's up? Oh, sorry about that. That's okay. All good. Ken likes to be called doctor, but it's just not accurate. I've never been called doctor ever, so I'm going to take it. Cool. Well, all right. My question is, you know, I've worked in the wedding industry doing music for weddings for almost 18 years now. And in 2022, I was making about, you know, $80,000 a year.

A year, halfway through 2022, I decided to go into business for myself. Last year, 2023, I did really well and took in about almost $250,000 to raise my income up. In the same thing? Doing the same thing? In the same thing. Wow. Good for you.

Thank you. So, you know, we spent the last year, we paid off our credit cards. We don't have any car loans or anything, but we do have two loans that are kind of hanging over my head. And I'm a little overwhelmed just trying to figure out how to manage the money. We have, my wife has about $120,000 in student debt. And I, years ago...

made a bad decision, took out an SBA loan, small business association loan. And it's about a hundred thousand dollars that I took out. So you got $220,000 to pay off and you made two 50 last year. Correct. Dude, you used to make 80. Yeah. Live on your old income and you're debt free in two years.

Yes. Okay. So my, well, the question I have to you is, you know, because as the business has really grown pretty quickly, almost, almost quicker than I, a lot quicker than I expected. So I'm like facing these,

where, not issues, but I need to. I'm looking at future jobs and realizing that I need to purchase. No, you don't need to purchase anything else. You need to keep making $250,000 and pay off $220,000 in debt. You don't need to be buying anything right now. You need to clean up your mess first.

Ken Coleman, Ramsey Personality, is my co-host today. One of our other fellow Ramsey Personalities is in the middle of book launch week. Tomorrow will be one week that the book has been out, Breaking Free from Broke by George Camel, The Ultimate Guide to More Money and Less Stress.

It is fun and packed with research, and you will never look at some of the villains in the marketplace the same again. He exposes everyone that is ripping you off.

Breaking free from broke. You will love the read. It's a lot of fun to read. A lot of people hadn't read a book in five years of reading it. That's a good indicator. That's a good book. George Camel. Check it out. You can get it at RamseySolutions.com or anywhere great books are sold. Lexi is in St. Paul, Minnesota. Hi, Lexi. Welcome to the Ramsey Show. Hi. Thank you so much for having me. How are you guys today? Better than we deserve. What's up?

Hi, I just wanted your advice on some career trajectories. Just to give some background, I'm a recent law student graduate. I chose my law school because I got a full ride, so I'm out debt-free. Great. Good for you. Thank you. And I took a job with my state's government as a civil litigator.

where I currently make $80,000 a year. And I love this job because I get the mentorship of a corporate law firm, but I get to do work that is meaningful to me, and I get to volunteer 15 hours a week. What is the work that you're doing that's meaningful?

I get to help protect people in my state from bad actors. Protect who? Residents of my state. Residents of your state. So who are the bad actors? Give us an example of who you're protecting them from.

Um, so I mean, if there's, um, someone who isn't paying fair wages to their employees or there's harassment in the workplace, I get to help step in and make sure that that isn't happening to my fellow citizens. Is that a form of regulation? Are you working for the attorney general? Yeah. Are you working for the attorney general?

Yes, sir. Okay. All right. I'm trying to make sure we go. That makes sense then. Okay. Cool. Yeah. And I love the work. I get a lot of really great mentorship. I get to go into court three to four days a week, which a lot of my classmates who went into big law, I mean, they're in cubicles. I don't. Right.

They're not going to experience I am. And I get to volunteer, right? I run a housing clinic through a legal aid. I get to volunteer 15 hours a week. But I chose my law school because I would come out debt free. And I went into it after spending three years working for a legal aid. And that's really where my heart is. That's where I want to give back to. And I'm wondering if I should...

Suck it up and go into a corporate law firm where I'd make an additional $100,000 a year easily. Pay off my house and...

you know, be able to really give myself to legal aid without any financial burden, or if I should go straight to legal aid work and, you know, potentially burn out because it's a lower paid position. And, you know, it's hard work. Option A. Now this is me. I'm going to answer it as what would I do if I were in your shoes with everything you've given me?

So you love the work that you do. You love the result of that work and you want to volunteer and legal aid is close to your heart. But the reality is, is that if you go into a legal aid position, you are probably going to burn out. Your income is going to be absolutely capped.

And I don't know that you're making more of a difference working in that type of a situation, 40 hours a week, 50 hours a week, as you would going to work for a great law firm with no cap, essentially, or certainly raise the cap tremendously on your income ability, and then give back with your time that way. The more money you make and the more money you keep,

Lexi, always leads to more freedom, more options with what you want to do with your time. You can give back financially and you can give back with your time in both positions. And I think you've got to create more income and more freedom for you to be able to have more impact. Now, I'm not going to say that you wouldn't make great impact. You wouldn't be fulfilled. But I'm telling you what I would do. I'd choose both income and impact, Dave, is what I would choose.

Because you can still volunteer making more money. The good news is there's almost an infinite number of answers to your question. There's a lot of different ways you can use the law to accomplish your goal. And I don't think it's necessarily...

you know, all, all in on legal aid versus all in on big law. And I lose my soul, but I make a lot of money so I can come back and find my soul again. You know, that kind of thing. I don't, I don't think you have to go one direction or the other there. You're in a mid level. You're in a mid middle decision where you are, where you're getting to do some of the legal aid work. And like you said, you're getting great mentorship. You're in court every day. So for a season, staying where you are might not be bad. Uh,

Um, then a third option pops into my head cause I'm entrepreneurial. I wonder what kind of boutique law firm you could, uh, own and operate after you've got a little bit more experience under your belt that would allow you to make a couple of hundred thousand and still have a lot of room for pro bono. And you select the type of legal aid you want to provide, um, as a part of the business model of running your own firm at some point, uh, where you made serious money off of, uh,

uh good people that you want to help uh and you're also have have the the margin to do the other stuff too so there's a lot of different ways to get at this um uh i i just i i don't i always um uh resist the idea that the only way you can do something noble and fulfilling is to be broke right that's why the contrary is true you can do a lot of noble and fulfilling things and

The people that you're helping will help you to help others in the process. And so I don't mind where you are for a period of time. It's scratching a whole lot of your itches right now. Yeah. And just say, okay, this is my...

This is my internship. This is my apprenticeship. And I'm going to do this for three years or I'm going to do this for four years. And then I'm going to take that and go open a boutique firm, make serious money on part of my clients and pro bono the rest of them and still scratch a lot of that itch. I don't think you have to necessarily build up a pile of wealth and then work for nothing at legal aid.

to have done good in society or done good in society the way you're defining it even. And I love that you did this debt-free. That's pretty stinking amazing. Remember, you and I were talking about this recently, that most young people don't realize the amount of law schools that are in this country because they think, well, I've got to go to the big-name law school, you know, Ivy League or Vanderbilt in our neck of the woods.

But there are law schools in every state that if you have the right GPA and the LSAT score, they will give you a full ride. Lexi's an example of this. And I want to applaud her too, Dave, because here's a young lady who's come out and she's getting courtroom experience, which is incredibly valuable. She's right. Her colleagues are sitting in the cube.

They're waiting for their chance to get in court. She's in there every day on the battlefield. I like my option plus Dave's option, Lexi. I thought both of those are sound ideas for you. You can give back, but you can move up at the same time. They're not separate choices, as Dave said. That's a false narrative, and you don't need to feel bad. I didn't like how she said, I have to suck it up and go to the big law firm. I wouldn't look at it that way. And I would look at it as, if I don't like the big law firm,

That's one thing. But moving up doesn't mean that I'm somehow not being authentic to who I am and wanting to use the law for good. Yeah, she just doesn't want to – she doesn't like that environment. I get that. And I don't blame her for that. I agree. I get that. I don't blame her for that. She's a warrior. Because basically, they ride you like a horse, man. I mean, it's like nuts. So, yeah, I don't argue that part of it. But, you know, there's –

There's a lot of ways to get at helping folks with the law. And there are a lot of angles on that that you can do that are not in any way a sellout. So good question. Good question. You're an amazing young lady. Thank you for calling in. This is The Ramsey Show. ♪

Our scripture of the day, Luke 14, 28. Suppose one of you wants to build a tower. Won't you sit down first and estimate the cost to see if you have enough money to complete it?

Dan Miller that we referenced at the top of the hour said, success is never an accident. It typically starts as imagination, becomes a dream, stimulates a goal, grows into a plan of action, which then inevitably meets with opportunity. Don't get stuck along the way.

That's good. Really good. Open phones at 888-825-5225. Morgan is in Ann Arbor, Michigan. Hey, Morgan, how are you? I'm doing great. How are you? Better than we deserve. What's up?

Yeah, my husband and I have been married for about two and a half years, and we have no debt. We would love to buy a house, invest more into retirement, and grow our wealth, but with the budget we have, there seems to be no extra room, even though we're living on as minimum as we can. So what advice do you guys have for growing wealth on a small budget or maybe maximizing that wealth? Well, either you're not living on as little as you can or you don't make much money. Which is it? I think if we don't make much money... What's your household income?

About $50,000. Okay. Yeah, you're below average. I don't mean that in a negative way. I'm just saying the average is $72,000 nationally. What do you each do? My husband is an audiovisual technician, and I currently don't work. I'm a full-time student. We have a baby. Full-time student. When will you be done? In about six months. And what do you plan to do? I don't really plan to work. I probably plan to stay home with the kids and eventually homeschool my kids. Why did you get a degree?

um i'm not paying for it so it's kind of presented to me as a way to get i got i started school before i got married and was maybe going to use it then and now i am married for a few years with kids so what's your degree in christian ministries okay all right um well i mean there's only two sides to the equation the income and the outgo and so if you all want to address your income side then you're going to have more margin

It's that simple. You'll have more wiggle room in this budget. You said you've got two kids? One kid. One kid, okay. And you guys are what, 25?

I'm 21. My husband's 26. Okay. All right. And so, I mean, you do not have a lot of room in a $50,000 budget. That would make sense in Ann Arbor, Michigan. I mean, it's not like you're some kind of crazy spender, like you're going out on the town buying $300 dinners every night. I know you're not. You don't have room in that budget to do that. You've done a good job staying within that budget, not getting into debt. Way to go. Good job.

But I think what you've got to do is, you know, I remember a guy teaching one time I was in a conference on leadership and business. And he said, the problem with hitting goals is not what you're willing to do to get there. It's what you're willing to give up to get there. And giving up in your all's case might be if we want to have a house, we're going to have to give up some time and be working.

Mm-hmm.

What's a number? Do you guys have an idea in your head how much more per month would make a real difference for you realistically? I mean, probably $500 to $1,000 because that's $500 to $1,000. Okay, here's why I asked that question. It's really important to get that number in your head and you two sit down and go, okay, what do we have to do to come up with an additional $1,000? Could you find some of that in the budget? It's possible. I don't think you have a lot of fat. So now it's how do I make $1,000?

How does he make $1,000? Can we do it collectively? Could you make $1,000 even being home with the one baby? Could he make $1,000? You can rack that up pretty quickly. And now all of a sudden you've got $2,000, but you've got to reverse engineer your activity to go, all right, this is what has to be true for us to be able to make an additional $1,000. And if you go above and beyond that, that's fine. But that's when you get some laser focus, and now you've got that margin. Yeah.

I'm going to send you a copy of Ken's book from paycheck to purpose for your husband. Uh, and you can read it too, of course. Yeah. But, um, what I'm thinking about for him is I think this is just a job he fell into. Like he ran sound over at the church and some buddies that were in the sound business had come work for us. Now he runs sound and, um, uh, you know, he's 26. So you start asking yourself the question, what am I doing when I'm 36 that I'm making money?

100,000 instead of 50. That's right. And do I own the sound company to have a completely different career direction? Do I take a class or two to make myself more valuable? But if you keep doing the same thing over and over again, expecting a different result, that's the definition of insanity. So change something.

And from paycheck to purpose helps lead him through a really clear path to do that. Yeah, it'll go from ideation in stage one all the way to realization of that, as Dave was talking about, 10-year, 20-year, 30-year plan. And he's got some skill set. He's got some experience. He can freelance with that skill set. But he needs to be raising the bar as to what he can make in the now but with an eye on the next. That's how you guys get to real financial success.

independence, and then the ability to do whatever you want to fund those dreams. Very good. Excellent stuff. All right. Nick is with us in Sioux Falls, South Dakota. Hi, Nick. What's up?

Hey, thanks for taking my call, gentlemen. How are you guys doing? Better than we deserve. How can we help, sir? Excellent. So here's my question. My wife and I are new to the Ramsey program. We have significant savings already built up. We do have some consumer debt that I think we can manage rather quickly. What is the significant savings?

About $18,000. And that's not in retirement? No, no, no. And how much debt do you have? So I have a couple car loans in a credit card. So $18,000 for my wife's car, $7,000 on my daughter's car, and a credit card that we have on the remainder. Okay. So how can we help?

Well, so my question is, you know, my wife and I are, once we take care of this consumer debt and we start to tackle our mortgage, we sort of have a disagreement. I contribute roughly 35% of my income to retirement. And the question is, should I reduce that and take that extra money and contribute it towards our mortgage in addition to,

Any additional funds that...

Mathematically, that's what's occurred. So, yeah, temporarily, I would stop putting any money in, not reduce it. I reduce it to zero temporarily. Temporarily, I'd not go out to eat, not go on vacation. I'd be on a tight budget, scorched earth. You and your wife sit down, make every penny scream.

And then I would take every dollar of that 18 except $1,000, and I would throw it at your smallest debts. List your debts smallest to largest and pay them off in that order. So those cards and that daughter's car are gone. The debt's gone. We're going to put a big chunk on your wife's, and then we're going to attack your wife's really, really quickly and get it finished up. Now you've got no payments but a house payment. That feels good, although it didn't feel good to stop that 401K for a minute, but it was just for a hot minute.

Now we're going to build an emergency fund back of three to six months of expenses, put that savings back, and then you got your rainy day fund, and then you restart your 401k. The problem is you try to do everything at once, so you're doing nothing.

And that's the order of attack. Hang on. I'll send you a copy of the book, The Total Money Makeover, to help you do it. Ken Coleman, good show today. Thank you, sir. That puts this hour of the Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

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