Live from the headquarters of Ramsey Solutions, broadcasting from the Dollars Car Rental Studios. It's the Dave Ramsey Show where debt is down. Cash is king in the paid off home mortgage has taken the place of the BMW as the status symbol of the choice. My co-host today on The Dave Ramsey Show, Kristy Wright Ramsey personality. We're here to talk about your life and your money. It is a free call and some say it's worth what you pay for it.

Phone number is eight eight two five five two two five. That's triple eight eight to five five two two five.

Max is with us in Canada. Hi, Max. Welcome to the Dave Ramsey Show. Hello, hello, can you hear me all right? Absolutely. What's up? Not much. Thank you so much for having me on. I just want to I wanted to say that I listened to your show for about a year now. And you always say when someone asks you how you are better than you deserve about something, I say no. And I think that's a really good question.

So I want to thank you for that. First off.

Thank you, sir. How can we help? So I would try and keep it as short as possible, but it's a little bit of a complicated story. It's not so much about finance, but more my relationship with my parents and some stuff that's been going on. So at the start of twenty nineteen, my parents told me that they were getting a divorce and over the next year or so I guess they started seeing some other people and then this summer.

So I'm like university and throughout the year. So I wasn't really there like for like last year during the school year. So anyways, my parents are now both seeing new people and they're both like, well, my dad's moved in with his new stepmom. And I recently found out that my mom had an affair back in 2008. And as well, she was cheating on the guy that she's currently seeing with my dad before the divorce. And that's kind of why the divorce ended up happening.

And my dad told me this. My mom doesn't know that I know this. And throughout the summer, I'm back from school throughout the summer months, and I was planning on splitting 50/50 for him to have only a few blocks away in the same town. But whenever she has that guy over, I can't really stand to see him. And my mom doesn't know that. I know that she cheated on him. I don't really know what to do because my dad has gone through, like, a lot with the whole divorce process.

My mom didn't to really treat him too well. And I want to kind of approach my mom and the relationship because now whenever I see her, I'm just kind of hurting and broken. And it's like whenever I see her, it's like, think about all that. And I can look at the scene and I love my mom and I want to make the relationship better. And I want to get some advice about how to do that.

Mm hmm. That's so sad. It's really hard. I'm sorry. Yes.

Thank you. It is you know, it's interesting, there's a weird dynamic when in anything, I think your parents make choices different than you. And this is obviously an extreme that, you know, really disappointing. But I think we had this weird experiences as adult children of parents making decisions you don't agree with because you feel almost a little bit like, well, you you wouldn't have done that.

But also, you're you know, it's a reflection on you because it's your family. It's your parents. My mom and dad both have certainly made choices that I don't agree with. And I think the thing that has helped me and I'm not a councillor, Max, but I'll tell you the thing that has helped me is just separating myself from that, just saying that doesn't reflect me. That's not what I would do. I certainly don't agree with it.

But my mom is a grown woman. My dad is a grown man, and they can live their life how they want to. You can talk to them.

You know, I think you can definitely there's there's room for open, honest conversation about your hurts or whatever you're comfortable sharing with your mom in order to mend the relationship. You definitely I mean, that harboring that. I don't know that that's going to be healthy for you all to be able to move forward. But I do think there's something important about separating yourself from that and not feeling like it's a reflection on you or your identity because of their choices.

I don't know, Dave. I mean, what would you say?

You know, it's just it's a hard time for you. I'm sorry. I would recommend you if you're not in a good church in your area, that you find one and you get some pastors around you, some good, strong men around you that are living life correctly that can help you walk through this and just walk beside you, because this is just a difficult thing. There's not a simple it's not a simple formula for a broken heart. And in a sense, this knowledge, if it's true, if your dad's telling the truth, if it's true, it breaks your heart.

You know, it makes you it was your book. But, you know, part of truthful part of all of us getting to be grownups is we figure out that our parents are imperfect and we move on from that.

True. It's hard, though. I mean, that's that's a hard realization. I'm not saying it's easy. I'm saying it's easy. The other thing is, is let's pretend it is true, OK? And let's pretend that you sat down with your mom and said, hey, dad told me this and this just gags me. This is grosses me out, and I just got to say that out loud, I don't know that you can you know, no matter what her response, it doesn't become less true.

It did happen. Yeah, and so there's not anything that you can say or she can say that's going to make it not have happened, assuming it's true, OK. And and I don't know if it is or not. I think your dad's completely out of line and malicious. If he had asked me, should he tell you this, I would have said no, it's none of his business to tell you this, right? It was her business to check.

Well, what happened was my sister had found some information on her phone and then I'd look through it. And then that kind of confirmed that in the house. My daughter was after it. Oh, OK. That's a little better on your dad. Yeah. Why don't you ask your mother?

Because I just don't really want to go directly to I wanted to go and my dad, I don't know, did but at the same time say I want to talk to you about it and I want to be here. And you can tell her.

But and I think I think you probably don't need to be stay in there. You need some physical distance and then you just say, yeah, you know, there's parts of my mom that she's always going to be my mom and I love her. And there's parts of the stuff that she's done that I don't love and I love her anyway, you know, and and, you know, because the truth is it doesn't really affect you except to the extent that you want it to.

It hurts your feelings. It makes you mad at disappoint you.

But but in terms of does the does the situation actually affect you know, you're now a grown man, you're in college and you're out of your parent's house and they're both running off in different directions. And so you just kind of love them. Where they are is what I would say.

But I think you need to get a good a good pastor in your corner that'll walk with you and guide you on this. I'm pretty sure neither one counselor, Dr. John Loney's, he's not here today, so. Yeah, you know, we're filling in for him, I guess.

But but, you know, those are just, I guess, life things from people.

We coach people in life all the time about all kinds of different things. So that's just some ideas, but. I think John would probably say the first thing you need to do is just stop and grieve the fact that your illusion, illusionary picture of the perfection of your parents is now shattered. Yeah, both of them. Mm hmm. Neither one of them are perfect, it turns out. And you know, what was wrong in the marriage that that.

You know, your dad didn't deal with that, put your mom in a position you felt like she needed to do, that, you know, is not saying she's a victim, but obviously the marriage was not healthy for a lot of reasons.

I think two things can be true to you can you can grieve that that happened and your parents aren't perfect and you can acknowledge that it doesn't affect you. I think both can be true. You know, I mean, and that's and you can accept somebody for where they are. Yeah. You know, I filed bankruptcy when I was 28 years old. I can't undo that. No matter how much it disappoints my kid. I can't stop that from having happened.

It happened. I did do that. Now, you know, this is the Dave Ramsey Show. Your timeshare is a debt, not an asset. There is no equity in it, but there are annual fees. In fact, in response to covid-19, timeshare developers are actually sending out special assessment fees. That's ridiculous. Get with timeshare exit team. They have exited over 22000 people. And when you hire timeshare exec team before the end of the month, they'll give you a huge savings call, eight four four nine nine nine exit or TIME-SHARE exit team dotcom.

Some exclusions apply see site for details. Ramsha personality, Christy Ryan, is my co-host today here on The Dave Ramsey Show. Matt is in Minnesota. Hi, Matt. How are you? Hey, Kristie. How are you doing today? Awesome. How can we help you? So I had just a quick question on career choice. I'm wanting to get a new position in my workplace. I work for a major known, well known hospital. And I would like to branch out a little bit.

But I got diagnosed years ago with HDB and I am very trying to think about explain it. Like, sorry about that, I'm always and how to get a new career, because I always am always nervous asking myself, can I handle this job because of my limitations with my attention deficit disorder?

What do you do now? I work for Mayo Clinic, I transport women in the hospitals. What do you what is it you want to do? My career goal is to be a radiation therapist and help people with cancer.

Mm hmm. Wow, good for you.

And so what would you need to do to do that, that you haven't done? You need certifications.

What would you need to do to get qualified for that?

I would have to go through the schooling, which is two years. It's like a two plus two. So I get my associate and then I would get my bachelor's in radiation therapy.

OK. Does the hospital, the hospital willing to help with tuition? Yes, they give three thousand a year for undergrad and five thousand a year for Masters.

What's the what's the downside of starting that? Just my own inner personal self of just having the confidence, knowing I could do it and disbelieving myself because I've had four for since I was diagnosed in first grade and just and just knowing my. Knowing what I am capable of and so the the long story short, I've always had just the confidence level that is lower. Mm hmm. That's logical. Pushing me back. Yeah, that's what it is, putting me back.

So but here's the thing.

You know, confidence is built by doing something, doing it well. And then, you know, you can do it right. So what if you started taking the classes and by going through the process of getting the certification, I think your confidence would be built, don't you?

Yeah, it's so interesting because I think sometimes we wait, Matt, for permission or for affirmation from another person to give us that confidence. But that'll never be enough. It has to be from you proving to yourself that you can do it. And what's so great is you're not, you know, jumping in the deep end where you're going to leave this job and try to do a job that you're not sure you're able to do.

The classes would not only prepare you from an education standpoint, but it gives you those reps that experience, that practice where you go after a course is completed, after, you know, several different things that you have to do. You'll look, oh, my gosh, I'm doing it. I can do it. And I think a lot I know that what you're facing, Matt, is real. It's medical. I understand that. I think there's also a piece of it that we tend to put labels and limitations on ourselves or other people do.

And then we live within them as if that is that that is an actual barrier that keeps us from doing these things. I don't think that that you have proof that that's a barrier that's keeping you from this job. I think in your mind it might be. But it's like Dave said, there's a part of it that's logical because you're being wise with like, what are my limitations? But you have an opportunity to try this class, try some of these courses, try to just, you know, see if you could even shadow or meet some people in that department, have an informational interview, ask some questions.

What is their what are their days like? And then the more you do that one tiny baby step at a time, you're building confidence. You're like, oh, I did do that. Wasn't that hard. I thought that was really interesting. Or I was able to maintain focus here because this really engages me in this in this way. And so I think you're going to surprise yourself and I think you're going to break out of the box that you've been living in or think you're living in and building confidence with you.

But it doesn't have to be this terrifying leap. It's just tiny baby steps in the direction of where you want to go.

Yeah, the reps. Yeah. And once you if you take those steps, your confidence is going to build. That's true of any of us.

I mean, first time you're right about Shiko first time you drive a car, first time you go on a date, the first time you do anything, you know, we're all a incompetent and B, scared and C, not really confident and good at it.

Yeah, because you've never done it before. So my turn on the microphone, I was scared out of my mind. I know what I was doing. I know how to answer the questions, but I sound like a hick on the air and it was awful. I gave the right answers and so I got to come back the next day. But that was it, you know. And so here I am, thirty, almost thirty years later doing this every day.

And so obviously I'm better at it now and more confident than I was back then. But because of reps, you know, first time, you know, we do both of us are public speakers and writers.

First time you write a book, you know, first time you doing you know, you're everyone builds confidence by building their competence and competence comes from increased learning and reps. Yeah, I tell people, I mean reps.

I tell people all the time the antidote to fear is action. Nothing will silence your fear of doing the thing like doing the thing. So go do the thing. It's a doing the thing that that fear lessens in your confidence grows and you go, oh my gosh, I can't do it. I did it once. I can do it again.

That's even true. Like when you're doing I got on that manhole skiing in Telluride with the boys and I got the top. It was the end of the day and I got the top of this dadgum black diamond. And it was so I thought I was I thought if I fall, I'm going to land all the way in the village. Yeah.

It was so steep I couldn't even see off. I was like a cliff. Yeah. And I mean, I'm sixty years old.

I get up there, my heart start racing. I felt like a four year old boy. I told, I told my son in law, man, we got to ski because if I don't get going I'm just going to freeze up and walk down. Because if I don't get moving, the antidote to fear is action. I knew if I did not start moving those skis down that hill that I was going to freeze up at the top of that.

But what happened was kind of a crap. What happened when you what happened when you made it? I climbed. I mean, I crawled. I was not skiing fast. But when I got down the bottom, what happened was I'm not ever going up there again. That's what happened.

But it's just amazing when you survived through it. And, you know, and I still but I still remember because it's been a long, long time for me where I was physically scared and I thought I have gotten myself into a mess here and I have got it.

And I knew if I stood there and thought about it too long. Yeah, I was I was going to end up taking the skis off and walking down.

Yeah, that would be a two and a half hour.

You I just went, no, we're going I got to go. Because if I sit here and think about it. Yeah. Screw this up. You just got. You'll appreciate the story, so last weekend, my husband and I went down the lake, I've only water ski like maybe 15 times in my whole life. I didn't grow up on a boat or anything like that. And so this last weekend, we didn't have the kids. We had child care.

It was just a weekend matinee. And I decided to try to drop a ski to slalom.

Oh, good for you. It was like, OK, you know, you're scared. Like you're nervous. I'm like, I'm not a professional skier. I'm barely, you know, and you're going to fall. I did. And I fell like maybe three or four times. I finally got the hang of it. But, man, when I stayed up and I rode that slalom ski afterwards, I was like, I mean, my chest just popped out my shoulders.

Like, I can't believe I did that. I can't believe I did that to be at any age doing anything new. Were you surprised yourself and go, I can't believe I did that. That's a cool feeling. That's a really cool feeling to physical examples.

But there's a career example. There's relational examples or spiritual examples of when. Yeah, the best antidote to fear is action. I really like that. That's good. That'll go that that'll preach. I preach good stuff.

It's good stuff because we, you know, we talk about our hair, even our our one of our core values at Ramsey, that we've got 14 core values on the wall, that we really are not sure fillers.

And one of them is fear not. Right. And it's not that we are never afraid. It's a we don't make decisions based on fear. And so you can bully us. You can put us in a corner and you might scare us. Yeah, you might say it's going to cost you 10 million or you might scare me. Yeah, but that doesn't mean I make the decision based on that fear. Right. I'm going to figure out a way to whip your butt.

Yeah. If you put me in that corner and I've just got to figure out how. Yeah. And I just you know, the first step is, is to not freeze up and and surrender.

People think it's a sign you're doing something bad. Often it's just a sign you're doing something new. The black diamond, the slalom ski, whatever it is. I love how Joyce Meyer says new levels, new devils. The moment you put yourself outside your comfort zone, of course, you're scared. You've never done it before. But it's in the doing that you lessen that fear. So go do it. Go do it. Start your classes right now.

Go sign up today and get started on those classes. You got four years of work for you. Ever get through the job anyway. So you got some time. You got you're going to work through this. Go do it. Go do it. This is the day Ramsey Show. If you really want to win with money, you have to learn to spend less. A great tool that's helping my listeners save money is called Honey.

Honey is a free online shopping tool that finds some of the best promo codes and applies them to your cart for you. One listener said, Almost every time I shop online, honey saves me anywhere from 10 to 30 percent and allows me to put that extra cash towards my debt. Add honey to your browser today. Go to join Honey Dotcom Ramsey.

Calling from Pennsylvania for a debt free scream, Travis and Barbara are with us. Hey, guys. How are ya? We're doing great. Mr. Ramsey, how are you, sir? Better than I deserve. Congratulations. How much have you paid off?

Forty eight thousand eight hundred fifty seven dollars.

Love it. Awesome. How long did this take? 22 months.

Good. And your range of income during that time? We started out making one hundred and four thousand and we ended up making one hundred and thirty two thousand. Love it. Awesome.

Very good. What do you guys do for a living? We're both schoolteachers.

So how did your income go up 30 or go up 20 thousand dollars in two years?

Travis fried some fish in the summertime, and I served the fish to people as a waitress. And I also went from working part time as a teacher to working full time.

All right. There it is. OK, well, well done, guys. Congratulations. What kind of dad was this?

We had a little bit of everything. We were normal, as you would say. We had a pension loan of twenty four thousand two car loans, just over 10000, two student loans at eighty eight hundred, a utility loan at 4500 and a personal loan at eight hundred dollars to to get a real estate license.

Actually, you guys were just, as you said, completely normal, just about everything.

So what snapped what lit the fuse 22 months ago. Tell us your story.

Thank you. Yeah. It actually started in March 2017 was March 9th. Barbara and I hit a pretty low point when we had to go declare bankruptcy, and that was on almost 20000 dollars in credit card debt. And as you know and I know a lot of your listeners know, we've we've really never experienced anything like it. It was. It was really. Gut wrenching, and we were sort of lost and floundered around for. Just trying to buy groceries and, you know, it was like where we were, those people who are literally making too much money to be this broke, you know, and then over that next year, I found your podcasts and found your program.

And Barbara and I, you know, we managed to get on on board and that just changed everything for us. Wow.

So this much of the debt survived the bankruptcy then? Yes. OK.

Wow. Yeah, that'll get your attention, so you had you kind of said, I can't keep doing what I've been doing, I'll keep getting what I've been getting. Something's got to change, right? Never again.

Oh, absolutely. 100 percent. Yeah. Good for you.

Well done. OK, and so you start paying off the debts in 22 months later, they're gone. How's I feel? I can see how it's the most wonderful feeling because we go through all the stress we have for not being able to pay our bills compounds into so many other things, like one little hiccup, and it bleeds into everything else in our life. And now we get to make our choices. We say, how are we going to spend this money?

And that is freedom and that is love. Like we get to be generous. And it's not just our bank accounts and it's not just our budget meetings, but it's a part of everything we do in life. It's it's freedom. Like I've never known. Like we've never known. It's amazing.

You get paid, you get to keep your money. And definitely a good feeling.

And not having the debt is wonderful, but having control is even more wonderful.

Oh, and just just having you know, having I mean, we're just so grateful for your plan, your wisdom, you know. I mean, Barbara, Barbara did all the hard work. You know, I just read the books and listen to some podcasts, you know, but it it really changed the foundation of of how we live our lives. We're just we're just in deep gratitude to you, sir, and your program. Very cool.

We're proud of you, man. That's amazing. Well done.

Very well. Don, who are your biggest cheerleaders?

We did. We had a lot of people in our corner, you know. You know, I have an uncle who was very supportive. And, you know, we have to thank my mother for sure. My mom, anytime I could pick up an extra shift to Barbara to pick up an extra shift, we had my mom right around the corner to babysit the two kids. And my mom was always a cheerleader, giving us all kinds of hints about how to how to budget and save money.

Oh, cool. So what is the number one thing you tell people when they say, how did you do this? You pay off forty nine thousand dollars in 22 months and make more money than you ever made in your life in the process. What do you tell people?

The key to getting out of debt is for Travis, and I believe the key is communication and sitting down to have budget meetings, because in the beginning it was hard. It was not always an easy thing to do, but the more we were committed to making it work, the better the communication got. And just like I said earlier, like it bleeds into everything else in our life and our communication just is better all across the board. Yeah, that's cool.

And I, I think, you know, that the discipline and integrity, you know, I mean that, you know, I have a touch of the free spirit in me.

And anytime I you know, I was ready to buy a new sofa, you know, Barbeau was right there with me to remind me, hey, you know, that's that's way far out in our budget future. And, you know, we're still waiting on that new sofa. But when we get it, it'll be on our terms and it'll be in cash for sure. Hey, man. Well done, you guys.

We got a copy of Chris Hogan's book for you every day, millionaires, because that's the next chapter in your story. I want you to keep going now, baby steps four, five, six.

Let's build some wealth now and finish changing your family tree, OK? Hey, man, well done.

Travis and Barbara in Pennsylvania. Forty nine thousand dollars paid off in twenty two months, making one hundred and four up to 132.

Count it down. Let's hear a debt free scream.

Three, two, one. That's what it sounds like when you finally get free. I also a love it. Congratulations, you guys. We're proud of you. Very well done.

Our Question of the Day comes from Blind's Dotcom. Find out for yourself why Blind's Dotcom is the number one online retailer of custom window coverings. You get free samples, free shipping and new promos every month. Always use the promo code Ramsey to get the best deal. Our question, Kristie.

Yes, this comes from Melissa in Tennessee. She visits Dave Ramsey Dotcom and says, with everything going on in the world right now, I find myself ashamed to celebrate my business successes because other small businesses and small business people are hurting right now. I've always shared my success with my customers to show them how amazing they are and how they show up for support. How can I navigate this time that we're in with grace and without making others feel bad? You know, it's interesting, Dave, is the people that ask this type of question usually aren't the ones that have to worry about it.

If she's self-aware enough to know I want to be considerate of other people, she's probably celebrate her, celebrating her business success in a way that already is filled with grace and social awareness. And she didn't say, how do I brag? She said, how do I celebrate what's going on in my business, what's going on? My customers. There's nothing negative about that. If you have a lens on it that is with humility and gratitude, it's going to come across the right way.

You don't have to completely diminish what's going on in your business or with your customers.

If you do it with the right heart, I think it's how you go about it and you're not aiming bullets at other people know. And so you're not saying you're a doofus and look how good I am. You're just saying this is working. Thank you, Lord. It might inspire them.

It might encourage them. Yeah.

People need to hear stories of winning at any time when times are great, when times are bad, they all need to see examples and hear examples.

I know we've got a friend named Jean-Francois here in town that started a cupcake thing with five dollars and it's a ten million dollar business.

Yeah. And she started it in our house making cupcakes.

And I can't think of any reason I would want her to not celebrate. Right. Right. I think anybody in any business, at any stage, whether it's good or bad, should go.

I love hearing Minyon Story. Right. It's good news. It's good news. Share good news, for goodness sakes. This is The Dave Ramsey Show. This is the day Ramsey show Christley Ray Ramsey personality is my co-host today here on the air. Spencer is with us in Lima, Ohio. Hi, Spencer. How are you? Is it Lima and Lima? Lima. Lima, OK. I got it right before taking my call.

Sure. How can we help? So I've been I've recently found your program and been going over my finances and trying to get down on our debt and really write them down and where they're at. So my question is, we have about six weeks that total eight eighty six hundred is coming from my car, which I paid to thirty eight a month. My question is, if I, if I sold it, I would get around ten to eleven thousand for it.

Would that be worth it to sell it and just pay off that loan, get a sixth of the overall debt out of the way. Or should I keep the car because it's yeah it's a Honda Civic. So I've been told those are pretty reliable and maybe do like overeats or something to supplement my income.

What is your household income? All right, now it's around 60000. My fiancee is currently going to school, so I'm the only one bringing income right now.

When you get married at the end of this month, actually on the 30th. Oh, congratulations.

That's wonderful. Thank you. OK. When were your fiancee graduate? She's graduating next May. She's doing cosmetology. OK. If this was a huge chunk of your debt, I would sell it in a heartbeat.

But it's a small portion of your debt and you need a car, you know? I mean, it's not some extravagant car. Yeah, it's not a thirty thousand dollar car. So I'm probably going to hold onto it. I'm probably going to hold onto it and pick up the extra jobs.

And by the way, she can to. OK, that makes sense, I just thought, because right now I'm working from home seven days a week, so five days a week, I guess I didn't know if maybe it made sense. So now get a cheaper car.

Well, it's not a bad idea, but here's what's going to happen.

You should be debt free in two years anyway, and you're going to be moving back to a reasonable car soon during then anyway. So the car is not really what's killing you here.

It's your income and the focus on the debt and so forth.

And so as you get married and she works an extra job while she's finishing up, finishing up cosmetology school, you work an extra job. You guys are going crazy work. And I think you're going to clear all this debt pretty quick. And again, it's not a big portion of your debt.

So you can do it. You can do it. If you want to sell it, it's OK. But it's not a Dave Ramsey. Kristy, right. Slapping her hand on the table, going, you're gonna get a stupid car. It's not it's not that situation.

It's just you know, it's interesting. In the last few weeks when I've been on cohosting with you on the show, I hear this type of call pretty often someone says something very similar to this call where they say, hey, I'm new to you, I'm starting the plan. And they want to make this big decision. And what I'm sensing is when you first start and you're kind of overwhelmed by your debt, 60000, whatever it is, eighty thousand, you want to not just have a quick win, you want to have a big quick win.

It's almost like we want to feel like I've made a huge amount of progress. I'm really on the plan. But to your point, you can take an extra job to do something like that where it's just consistency over time. You talk about this all the time and the tortoise and the hare that leads to winning. You can do that without like you, that you can sell the car. It's not a bad idea, but that's not going to be the thing that's going to get you debt free super fast.

You just probably want to feel like you've made a big difference. Do you hear that? Like, I've I've noticed that pattern.

And if you can get a quick win, it's really good, not only mathematically but emotionally. I mean, if you had ten thousand dollars in mutual fund, just cash that impact paid on the debt. Yeah, that's a good thing. Yes. We're going to do that.

I'm not cash out your retirement, but the cash out of retirement to pay off my dad is a quick win is it's scratching that exact same itch that you're talking about. Yes. It's the exact same place in people's brains or in our emotions that that we that we want to do that.

So, you know, and again, if you had a thirty thousand dollar car with thirty thousand or thirty thousand car period where they the debt on it or not, I'd be getting rid of it in this situation because it would be a big quick win.

This is a small win and it's a fairly large sacrifice. Yes. Yeah, the trade off is not there for me.

The headache of selling the car and buying a new car to downgrade a little bit, you know, I mean, it's just.

Yeah, no, you know, so much except in the car and go through things like are you to move the needle. Right. You know, that's not that one his numbers. But I mean, that's the same category that this falls into.

Grace is in Tampa. Hi, Grace. Welcome to The Dave Ramsey Show.

Thank you. My question is, when my husband and I were a baby step two in where we have a Monday to Friday job, so we want to open a residential painting business, but only for the weekend as our side hustle and when. And I think it's going to make no more profit, maybe 30000 a year. So to protect my assets and protect, you know, just myself, what I said, I'll see what I say. You know, like, you know, just whatever homes I have, you know, how many homes do you know who are just too.

But I mean, like my you know, I do I do an LLC or do I just ask the IRS, you know, for ten ninety nine type of thing, like with the federal I.D. number.

Well Federal Court limited liability. So really, what you need is really what you need, insurance. On your business right coverage, you have it. I'm going to get insured. Yeah, that's all. You know, that's really you don't you don't you do not have a net worth of over a million dollars, do you? No. OK. And you're talking about 30000 out of business, so the business is not large enough. It has a target on it and your personal assets are not big enough that they've got a target on them.

So just get some good insurance and don't waste your money. And screwing around with an LLC, the only reason you would need an LLC is if you're trying to protect from liability and not this business starts doing 300 grand or you look up, you've got a paid for property in your name. It's worth 500 grand or something. And you want to get an LLC at that point, then that's fine. But the business that is Ramsey Solutions started as a sole proprietorship and we were well beyond thirty thousand dollars of your income before we incorporated, which we later converted to an LLC.

I get this question all the time, Dave, and I think I think it's two part one. People are asking, do I need to incorporate for my side business that's making ten thousand dollars a year because they feel like that that's what a real business is. This was what makes it a legitimate business. There's one side. The other side of the equation is they're getting advice from people, you know, attorneys, people in the the tax and legal profession that are saying you have to incorporate, you have to set your business up as an LLC to, you know, protect against risk and yada, yada, yada.

And so, so many people that's a barrier for them because they they feel like, well, I'm not ready to do that or I know how to do that or that's too much money, etc.. And you don't have to paint some houses. You don't have to go paint some houses and get some money. And if you paint a bunch of houses and get a bunch of money, then then we'll worry about an LLC. But this idea that it's you don't have to you know, it does not legitimize your business.

And it does not mean that your official, your official, when you pick up a paintbrush and somebody pays you. That's right. At that moment, you is official.

You is a painter. At that point. This is what's happened until somebody pays you for it, you're not.

And that's the measure of the legitimacy of the idea. And the LLC does not legitimize the idea or the business or you.

And it wasn't wasn't what she asked, but that is down in that question all the time. You're right.

Yes. Well, and even like you said, like when they're at the set up stage, if you Google it, if you talk to someone who has an a friend who is attorney, a lot of times they'll get that advice that they have to. So they're not sure what to do from there. So I just love reminding people, hey, you don't have to do that out of the gate. This is a small business. It's a side business.

Let's validate the idea. Let's get some cash flow in and then we can talk about that if and when the business justifies it.

Yeah, absolutely. That's exactly how it works, folks. So, yeah, you can get an iron. An employee identification number from the IRS does absolutely nothing. It just identifies the business for purposes of payroll taxes or for purposes. If you want to run, you know, when you get ready to file your sole proprietorship as a Schedule C on your income tax return, you just list the iron.

But it doesn't it doesn't limit liability at all. It doesn't change the fact on that whatsoever. So good question. Thank you for joining us, Grace. That puts us our The Dave Ramsey Show in the books. Our thanks to James Childs, our producer, Kelly Daniel, our associate producer and phone screener. I'm Dave Ramsey, your host.

And we'll be back at. I have a friend or family member that needs a daily dose of Ramsay advice in their life. Let them know about the Ramsey Call of the Day podcast. It's a quick of advice about life and money in under ten minutes. Check out the Ramsey Call of the Day podcast wherever you listen to.

Money isn't the only thing we talk about around here. Get life changing advice on your career from my good friend and career expert Ken Coleman. Oh, my Ken Coleman show. According to a recent Gallup poll, nearly 70 percent of Americans are disengaged at work. If you dread going into work every Monday morning and you're just trying to make it to the weekend, the Ken Coleman show is for you. Everyone has a sweet spot. Your sweet spot is at the intersection of your greatest talent and greatest passion.

We will help you discover what it is you were born to do, and then we'll help you create a plan to make your dream job a reality. You matter and you have what it takes. Join the conversation on the Ken Coleman show here. More from the Ramsey network, including the Ken Coleman Show, wherever you listen to podcast.

Hey, it's James, producer of The Dave Ramsey Show. This episode is over, but check the episode notes for links to products and services you've heard about during this episode. Thanks for listening.