Transcribe your podcast
[00:00:25]

Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Carbonyl Studio. This is the Dave Ramsey Show, where America speaks out to have a conversation about your life and your money. I'm for smoking and hosting. Along with me this hour is Dr. John Villone. And I have to tell you, we are ready to rock and roll and take your questions. What you have to do is pick up the phone and call us. Kelly's waiting. She's actually kind of bored.

[00:00:51]

So I want you to hit these phones hard. Let's keep her busy. The number to call is eight to five. Five to five. Again, that's eight eight eight eight two five five two two five. And also social media. You'll do me a favor. I want you to to follow John at John Boloney. You can find him on Facebook, YouTube, Instagram. He has no idea what these things are, but you can follow him.

[00:01:14]

I only know a couple of them myself, so you can follow me at Chris Hogan 360. But we love interacting with you and we appreciate you all leaning in on us and with us. And I want to let you know right off the gate that John has a new show that has launched the Dr. John Boloney show. Very creative title, Perry.

[00:01:32]

And we got crazy. You'll be able to find it on YouTube as well as anywhere podcasts are are played. He's going to be talking about life relationships, mental health challenges, dealing with anxiety, depression, you name it. But you've got an opportunity to call in and ask him questions. And so if you have a question, here's his email. Ask John at Ramsey Solutions. Dotcom, again, extremely creative. That email address asked John Ramsey Solutions dot com or here's the number you can call.

[00:02:02]

Leave a voicemail eight four four six nine three 32, 91. All right. Are you ready for this call? Let's do it. All right. We're going to try to lift up to it. We got Aaron on the line first. We're going off to Texas. Aaron, please don't talk too much about Texas because John stood there and he gets really excited.

[00:02:21]

I can go on and on if you want, as most Texans can and as most Texans can. Go ahead. What's on your mind, buddy?

[00:02:28]

All right. So I'm 25. My dad passed a few months ago. I inherited I wouldn't say he earned it. I received 200000 other life insurance policy, 800000 before I went to his house. It's worth 220. Twenty. It's a ninety on it. I'm really wanting to buy a house. I'm just wondering if I should put two hundred thousand down on a house that's three seventy or what I should do with all this money because I'm just blown away.

[00:03:03]

Yeah, well, first of all, Aaron, my heart goes out to you, my friend. What happened with your dad here?

[00:03:10]

He had a heart attack going to work, and I hate that for you guys.

[00:03:16]

Were you guys close? Yeah, yeah, we were pretty close. Do you have any other brothers or sisters now? Just you, huh? Wow. Is your mother around?

[00:03:30]

Yeah, yeah, she's around. OK, and so you've been left with this dollar amount and you want to know what do you do? Right. I would say this, you know, first and foremost is understand an inheritance is is something that was intentionally left to you, OK? That meant your dad wanted you to have this stuff. And I think one of the most important things you could do is to be extremely intentional with it as you move forward the home.

[00:04:00]

Are you living in this home right now? No, I'm in an apartment currently is up in a week. OK, who's living in the home? My mother is OK. All right, so you left the home, but your mom still inhabits it, right?

[00:04:18]

So he put everything in my name because she's disabled. And I guess you didn't trust it with money.

[00:04:23]

OK, OK, here's I want you to do something, my friend, before you start to do anything with this, because typically there are laws about what a spouse can get at minimum.

[00:04:35]

Now, you may be have what's called power of attorney and may be the executor of this. But I want you to reach out to a to an attorney to really review the document so you can understand what's actually yours versus what you have to keep an eye on for the sake of your mom.

[00:04:53]

Does that make sense? Yes. OK, because here's the deal. I don't want you to start making plans for this, that you have to end up backing out because typically a spouse would get no less than a third. So let's just get some guidance. But let's say this. Let's say you walk through and what is in had has been left to you is yours. I think you need to be extremely intentional, Aaron. And what I mean by that is you're 24, 25 years old.

[00:05:22]

You just had a serious loss in your life. The mindset can be to do some stuff, to try to medicate or to do stuff to try to, you know, super honor your dad. And I think the best thing you could do is be very intentional. Be very clear. I wouldn't buy a home until you're ready to be there at least three to five years. I wouldn't go out and buy a depreciable assets like, you know, afford 750 or anything like that.

[00:05:47]

You want to be clear. You want to be calm. And so I would say park that money. If it gets liquid and it is yours, park it in a money market account. Let it sit there until your crystal clear. I typically when people get money from a loss of a family member or something like that, I typically say park that money for three months, six months, three to six. Don't do anything with it because odds are you're liable to be more emotional in what you do than rational.

[00:06:14]

So that's what I do.

[00:06:16]

Yeah. And again, adding in the additional challenge of mom, a special needs, a big chunk of that money may not be yours to spend as much to serve your mom. So finding an attorney, finding a smart Vesterbro, someone to guide you through what to do with that money is going to be a big help.

[00:06:33]

And here's the other thing, John. Let's take it a step further. If the dad has passed away unexpectedly and now you know, you got Aaron who's now watching out for the mom, this is the time where you have to take a look at setting up a trust. That's exactly right. With that trust. Right. Because if something happens to him, who's taking care of mom? Right. Right. And so this becomes one of those things where it's a legacy mindset.

[00:06:55]

And I know people don't like talking about diet, but here's the thing. I know there's 100 percent chance, 100 percent chance we get out. We don't get out of this life a lot. That's right. And so what we have to do is be grown up enough to do those things. And so, Aaron, as you reach out to that attorney, I want you to talk about a trust, begin to think about who else could you establish as an executor of this for the sake of your mom and my friend, I just want you to take some long term decisions.

[00:07:23]

I tend to tell people make to your decisions. What I mean by that is make a decision today that you're going to look back on in two years and you're glad that you made it. And what happens when you do that is you've got to wake up. You've got to kind of look out long term, John. That's right. And you make to your decisions.

[00:07:39]

I try to you know, I try to and when I'm I find myself in a position where I'm not going to make it to your decision. I know enough about myself, wisdom wise, to have friends in my life, to have accountability in my life that are going to stop me and say, are you sure that's a good idea? Right. My wife is a great example of somebody who will say that's that's too short sighted, John. Right.

[00:07:59]

And this is one of those moments when Aaron, the 25 year old, suddenly becomes, Aaron, the.

[00:08:06]

The guy's got to make a bunch of decisions, right? Yeah, the guy that just got to enjoy things and loved his old man and got the love on his mom and now he's got to make some hard decisions or get some wisdom in your life, brother. And this is one of those moments when when you've got to step up and grow up quick, you really do. And you want to get the right people around you that can help you.

[00:08:22]

And that's what what I call building a dream team. You can read more about that at my website. Krischan 360 Dotcom. This is The Dave Ramsey Show. Check out this headline courtesy of Politico, Dotcom emergency relief screw up hits five million student loan borrowers, nearly five million student loan borrowers who got a break on their monthly payments from Congress have been hit with incorrect information on their credit reports. That's what happens when you just sit around and trust the government to take care of your money issues.

[00:09:20]

Refinance your student loans today to take advantage of the historically low rates. Splash is offering go to Splash Financial Dotcom Ramzi. Hello, everyone. You are listening to the Dave Ramsey Show. I have to tell you, it's so exciting to go out in the lobby and look up here. We got real folks, real folks looking good. We've got two from California and we've got them from up north. I mean, just it's just fun. Listen, if you're here in near the area, Jon and I get up early to baked goods for you.

[00:10:03]

I couldn't even say that with a straight face. Miss Melissa Wilson over there takes care of the baking and all the coffee and all the good stuff. So please come eat the sugar that we provide you over in the Baker Street Cafe. She's a rock star and she will take great care of you. But we also have a bookstore over there. And if you are in the area, you have an opportunity to be able to grab some books, to be able to take it back.

[00:10:28]

Let's share information with family members that can help them. You know, we will share recipes. We will share favorite songs. We'll talk about restaurants. But we need to have start to have more substantive conversations on topics that can truly help folks.

[00:10:43]

All right. I got the blind dot com question of the day for you, Chris. Right. I'm really sorry. I need your help. All right. Here we go. Blind's dot com. Find out for yourself why Blind's dot com is the number one online retailer of custom window covering. You get free samples, free shipping. And if you're an idiot like me and you cut it and measure it wrong, you send it back and they will send you new stuff.

[00:11:04]

And with the new promos they run every month, you'll save even more. Use Promo Code Ramsey to get the best deal. Rules and restrictions apply. All right, Christopher, today this calls for you comes from Brad in Florida. He visits Dave Ramsey dot com to ask I've almost completed baby step three and I've been looking into starting my retirement through my company match. I was looking at the website to start with it, but I was wondering what is the difference between an aftertax 401k and a Roth IRA?

[00:11:34]

I know they're both taken out after taxes, but what is the implication, the tax implications later in life and what would you recommend?

[00:11:40]

OK, Brad, great question. So the bottom line is this. When you're talking about an after tax 401k, that is the Roth 401k, Roth simply means that you're using after tax dollars. So with a regular 401k, you're using pre-tax. So the money is going into the 401k at a regular one. Right. And you're going to pay taxes on that money later when you pull it out at 59 and a half. OK, but what the Roth 401k you're using after tax dollars, so there are no taxes for you to pay later because you already paid the taxes on this money.

[00:12:15]

So there is no taxes on the growth. It's going to grow and you can take it out as you get as you please, and that Uncle Sam gets nothing further. So both of these the Roth IRA and Roth 401K allow you the after tax benefit right up tax free growth. You have an opportunity when the Roth 401k, obviously to put aside much more money. Right. You can do up to 19500 dollars there. If you're over 50, you can do an extra 6000 and catch up provision.

[00:12:47]

So both of these are great tools. You can do more in the Roth 401k. So, my friend, definitely take advantage of the role 401k every time you have a chance. Very cool, man. Very good. Well, that's a blunt dotcom question. Also, I've got Lycett the housing housing markets out there booming.

[00:13:05]

OK, it's bananas. You just you just participated. Yes. Yeah. Bananas to spill bananas. I did. OK, well, did you use a real estate LP?

[00:13:16]

I did. Amanda Lucas is straight out of Compton. Dude, listen, she's stuck with me for nine months of failed.

[00:13:24]

We were under contract. It went down. I had all these expectations. She sat me down and she said, I know you think you're fancy because you're on a podcast, but your expectations are outsized for this market.

[00:13:35]

She sat down and walked me through things and we closed a couple of weeks ago. Me and my family are in a new home and it's from a Rams LP here in Nashville. She's incredible.

[00:13:44]

OK, how long did she deal with you? Nine. Buy her a gift.

[00:13:49]

I did. OK, I know whatever you got, go back, get you more OK because you didn't do enough for. All right, here's the deal. Housing markets is hot right now. There's a lot going on. The main difference between houses that sit on the market and houses that actually sell are real estate agents who know what they're doing. This starts with you knowing the value of a good real estate agent. It's worth it to find an experienced agent who cares about getting you a hundred percent of what your house is worth.

[00:14:17]

That's why we only endorse the top agents around the country, our local providers, our endorsed local providers. So it's easy for you to find a quality pro to help you win. So never again settle for a subpar agent. Get your home sold for what it's worth. Visit Dave Ramsey, dot com slash agent. To find an agent that we would recommend in your area, again, this is really important, Dave Ramsey, Dotcom's agent, you want to make sure you're reaching out.

[00:14:45]

I want to deal with the probe is going to get the job done. All right. Get to the phone lines. We've got Corey on the line in Kansas City, Missouri. Corey, how are you? I'm doing good. Hi, John. Hi, Chris. Hello there. What can we do for you today? I have decided to go back to school, get my MBA, and I'm trying to figure out, are you able to get a graduate program done debt free?

[00:15:12]

I don't see nearly as many scholarships or options available as there are for a bachelor's degree. Mm hmm.

[00:15:21]

You want to get through MBA? What are you what do you want to do? I'm wanting to be a director and the public sector, I work for Parks and Recreation. OK, and is a master's degree a requirement? It depends on what area in here it was definitely helped me get that job and the timeline I set out for myself.

[00:15:44]

OK, what's your timeline? Seven years, seven years. Yes, OK, and what is that what is a mass NBA cost in your area right now? About 14, 15 thousand, Toby. Yes. OK, and what do you think you would make with that master's degree? Double what I do now, so probably 75, 80 thousand years. OK, 14 or 15 is a remarkable cost. That's a that's a that's an excellent deal for an NBA.

[00:16:20]

That's a good deal.

[00:16:22]

You are right, NBA's, Chris, are traditionally those degrees that are not they are more pay to play, if you will.

[00:16:30]

There's not a lot of scholarship money out for MBAs. They are they are traditionally EROI degrees, which are I'm going to get this credential, learn this set of skills so I can go to the marketplace and make more money and schools price them as such. So 15 grand is it is. That's the lowest I've ever heard.

[00:16:51]

So what are you what are you in school or you're working full time right now, correct?

[00:16:56]

Yeah, I'm working full time right now in the field.

[00:16:58]

All right. You said you would double it. So I know what your income is right now. So what debts do you have right now?

[00:17:05]

Student loans. What? I want to do it again. We still have 20000, 28000.

[00:17:11]

What else? That's it. I'm just down to the student loans, OK? And so looking at this, you know, I mean, you know, there's no way in Hades I'm going to tell you to look at taking out a loan. I mean, it's just not going to happen. So, you know, it's that mindset of looking. And I would much rather you cash flow your way with this masters. And I don't care if it takes you.

[00:17:36]

I know you've got your time line in your head, but you can only move at the speed of cash.

[00:17:42]

OK, so, you know, I want you starting to think about, OK, if I'm moving at the speed of cash, this is my full time job. What's other opportunity I have for another part time job or to save up. Right. So I can start to take classes and go that route. But I'm in no way career going to tell you to take on more student loan debt. Absolutely not.

[00:18:02]

And I. Should I pay off my current student loans before I would cash flow, I would cash flow the Masters program. OK, I'd much rather you focus there and then you get that. Then you can focus on attacking the debt. OK, OK, so that that mindset of this is an opportunity. Now, here's the deal. I need you to really gut check yourself to say, am I serious about this degree? Am I serious about the direction it's going to lead?

[00:18:35]

Because, you know, that's going to be an important thing to decide. But no, no doubt. Not at all. Be allergic to it, crush it, save your money, work really hard for the next 24, 36 months, you're going to end up with an MBA paid for with cash. You know, I that's a good as it might take longer. But here's the thing. It's going to feel better because you don't get the souvenir of a payment knocking at your door each and every month.

[00:19:00]

This is the Dave Ramsey Show. Technology and innovation are crucial for any company's success, but the primary focus should always be on you and meeting your needs. That's why you get the best of both with Zander Insurance and their term life plans. Xander uses time saving technology like over the phone applications, Boice or electronic signature, and even plans with no medical exams to speed up the process of getting you the protection your family needs. They are committed to serving.

[00:19:51]

You go to Xander Dotcom or call 800 three five six, 42, 82.

[00:20:06]

Hello, everyone. You're listening to the Dave Ramsey Show. I'm Chris Hogan and hosting along with me. And I say with me is Dr. John Boloney. Pray for me as I try to keep this man on the rails. We are having a blast taking your calls about life and money. And I have to tell you, we appreciate you trusting us and talking about the things that are on your mind. When you ask the question, you actually are doing someone else a favor because other people have those questions as well.

[00:20:38]

And the fact that you're willing to ask and that you have the courage to call in, you're actually helping others. So I want to encourage you to keep calling. The number to dial is eight eight to five, five to 25. Again, that's eight eight eight eight to five five two to five. All right, here we go. We're going to go talk to Matt. We're going to go to Roanoke, Virginia. Matt, how are you?

[00:20:59]

Hey, Chris. I'm doing well. How are you? Oh, my friend. I'm focused and not finished. What's on your mind?

[00:21:04]

So me and my wife just get out of there just up to great job. Thank you. Yeah. And we'll be through baby step three in two to three months. And I'm trying to figure out what to do with my little allowance once we get through baby step three, OK?

[00:21:20]

Well, hold on. Let's just not skirt by the fact that you got out of baby step two, let's celebrate. Make some sacrifices, man. How much did you pay off?

[00:21:29]

We paid up 87000 and 16 months. So he's going to blow by that one. Matt, congratulations, brother. That's awesome.

[00:21:37]

Yeah, thanks. That's a big deal, my friend. Tell me, what was the biggest threat in the 87000? Oh, I have to say, some cars and we did some stupid vehicle, you said some cars, how many was it? Well, we paid off my wife's car first and then we paid off my car. We did a knee jerk on a dealership because we moved and the vehicle didn't pass inspection. And so I got a good deal on the car.

[00:22:09]

And so now car's gone and I'm trying to plan for the next one because I travel a lot for work.

[00:22:14]

OK, so you get a car allowance through your job. How much is this allowance?

[00:22:19]

Oh, it's about three hundred dollars a month.

[00:22:21]

OK, and so you want to know what to do with it. What do you. What do you mean. Yeah, so I was thinking about putting in a no load index fund and taking advantage of mutual funds to allow some growth to happen. OK, I travel about 20000 miles a year, so I'm thinking I can leave the money in the market for at least five years before I need to replace my vehicle. Good.

[00:22:45]

That five year mark is is the most important thing. Now you suggest that. What did you say?

[00:22:51]

You wanted to invest it in a no load index fund.

[00:22:54]

OK, yeah. That growth stock mutual fund putting it there. Does this money come to you straight from the company?

[00:23:05]

Yes. And it gets deposited into my account every month.

[00:23:08]

OK, so it's separate from your your piece, their paycheck. Correct. Yes, OK.

[00:23:15]

And the car you have for work is, is it going to make it through the year. Oh yeah.

[00:23:21]

It's 2017 Chevy Malibu. OK, several years left.

[00:23:26]

OK, and so you guys are on baby step three right now, correct. Yes. OK, so how far into baby step three are you. We just got started this month, so baby step three in November. OK, now, Matt, you know what I'm going to tell you because I'm a purist, right? Hey, Matt, do you barbecue at all? Oh, yeah, I got a girl on the back porch. Do you really you can't is it is it charcoal or is it charcoal or gas?

[00:23:55]

It's a gas grill.

[00:23:59]

No matter where she gets it, Chris is for that or we miss the chance we were about to bond.

[00:24:05]

We Matt, come on, get some charcoal, man. All right. Now, listen. Nothing wrong with the gas grill for quick cooks. That's like the Lowney. You don't know how to do things right. But what I was going to tell you was I'm a purist. I want you to follow the recipe. What I mean by that is I don't want you to invest anything until we get this emergency fund in place. And so that just means you want to utilize and that even the car allowance, along with any other money coming in, we're going to identify that as emergency fund money once that's in place.

[00:24:37]

Now, I want you to invest your 15 percent, then you can start to look at doing that with the car allowance. But that's kind of the mindset. Just because I do want you to follow the recipe. And I grew up my grandmother was an amazing cook. I never saw a recipe anywhere but all of her dishes, they were amazing. And I moved off to grad school and decided, John, that I was going to make her chili.

[00:24:58]

And so I went and bought some stuff that I thought go into chili. And what I ended up making, I was tantamount to chili colored glue is what we'll call it.

[00:25:08]

There's still some hanging around.

[00:25:09]

You just put it in my mouth and my tongue sort of signal to my brain that was get it out, get it out.

[00:25:17]

And when I threw it outside in the squirrels, what needed I knew there was a problem. And so I called my grandmother. I said that I got a problem. She goes, Honey, what's wrong? I said, My chilies broke like it's just broken. There's a problem. She goes, How did you try to make my recipe? And you didn't call me. I said, Well, I just you know, it turns out I was missing a few things, John.

[00:25:34]

I left out chili powder and chili beans. Anyway, don't worry about me. Just chili, right? Listen, bottom line is, if you want to make chili, you follow chili recipe. If you want to get to the point to where you're building a legacy and you want to breathe easier, follow the baby steps in.

[00:25:51]

Is it common that people get other streams of income, they get something that's quote unquote earmarked for the car or quote unquote here, use the housing allowance and it's easy to get tunnel vision? Then I would imagine that, OK, this just goes for the house. So how do I set up this house lane and they miss the forest for the trees?

[00:26:06]

I can't. It can't. And it's not typical normally at someone in the military or someone on a job, but typically people just have income coming in. And so it's just in that mindset. But we always get people calling in, wanting to change the baby steps. Right, right. Don't mess with the recipe.

[00:26:23]

It works. Yeah. All right.

[00:26:25]

Here we go. We got Kyle's on the line. Kyle is in Phoenix. What's your question for us, my friend?

[00:26:31]

Hi, Chris. My question is like I have two questions. Should I pay or should I sell my house to pay off my debt? And then can you kind of tell me how capital gains tax works? OK, so tell me this, my friend.

[00:26:49]

How much is your house worth?

[00:26:53]

My realtor thinks that we can get three fifty five thousand. Fifty five thousand.

[00:26:57]

And how much do you own it? Two hundred and sixty nine thousand.

[00:27:02]

All right. You guys have been in there. How long?

[00:27:05]

We've been in here for a year and a couple of months. A year and a month. OK, you're in a couple of months.

[00:27:11]

And when you all bought it, did you put some money down? We did a down payment assistance, so we'd have to pay that back. OK, we owe about 5000 on that.

[00:27:25]

OK, all right. OK, what? What you all's household income. 100000, OK? And you're wanting to sell this to pay off student loan debt. Yes, so I have sixty nine thousand dollars in student loan debt and thirteen thousand dollars in a truck on a truck.

[00:27:46]

OK, and how many people are in your family? Me, my wife, and we have a five month old son now five month old. What's your wife want to do? Does she is she willing to sell the house to pay off student loans? Yes. Really well, she really likes to have come here because that's where her flag, I said, are you sure? She said, Oh yeah, she's fine. Well, she kind of like me.

[00:28:15]

Hold on. Just scare her, OK? All right.

[00:28:20]

So she loves the house, but she is more terrified of the debt. Yes, OK. OK. And I'm going to get her in Zaydi.

[00:28:27]

OK, well that's a that's a good thing. But I'm going to ask one more time because sometimes people don't hear me. They say my voice is weak and they can't hear it all the way. So what else do you all owe on? It's just the student loans in the truck and you tell me the student loans are 69000. There's no other student loan. Correct, and that's between me and her. OK, here's the thing, you make 100000, you don't owe on anything else but the student loan and the truck.

[00:29:02]

Here's a couple of things. Number one, you've only been in this house for a year and a couple of months, so capital gains is going to be staring you right in the face because you haven't been in the home for at least two years. So you'd get hit there. The other side of it is you've got this down payment assistance. So the equity that you think you have, you really don't have. I think you cash flow your way through this.

[00:29:24]

And I'm going to get radical here. John, hold on to your earpiece. I want you to sell the truck. I want you to get serious in cash flow and get start attacking this debt. I think you need to sell the house, which you got to do is sell the old way of thinking, my friend. Think different, do better. Attack this stuff and get it out of your life. Watch what happens. Little piece of come over you.

[00:29:45]

The Dave Ramsey Show. Hello, everyone. This is the Dave Ramsey Show, and I tell you, we have had a blast today having an opportunity to talk to you about what's on your mind, your money, your life. The reality is, is we are all in the process of improvement and you don't have to be perfect to be perfectly capable of making strides in the right direction. And so just want to encourage you to call us John and are ready to talk to you to take your questions.

[00:30:26]

The number to call is Elite eight to five five two five. Again, that's triplet 8255, two to five. We'd love to hear from you.

[00:30:34]

OK, here we go. We're going to the phone lines. We've got Chloe on the line. Chloe, how can we help you?

[00:30:40]

Hi, thank you so much for taking my call. I recently this year just started with a financial piece and getting my life on track. I'm on baby steps to my husband and I. Good. And I had a question. We see that we're probably going to be down to our final two, but in a couple of months. All right. And one is a really, really, really big student loan. And that's our last debt. And I wanted to find out if my student loan is more than a mortgage I had yesterday.

[00:31:22]

Do I still attract the student loan because the mortgage is not in baby steps? OK, got. Good question.

[00:31:29]

And Chloe, I just want to back up here because you had a lot of really, really, as you were describing that student loan, you said a really, really, really big student loan.

[00:31:39]

How big is this is not a the I'm about to ask you, are you a surgeon of some sort? No, no, no.

[00:31:46]

I don't know how terrible, terrible, terrible idea this was, but now I am not a doctor or lawyer, and my mother wants total about one hundred and twenty three thousand dollars.

[00:31:58]

Oh, that's not a lot, Chloe. We had a million. OK, let me back it up. That's a ton of money. That's six figures. That's huge. OK, I thought you were about to drop a million dollars on us to 350000.

[00:32:11]

So let me back it up. Chloe, that's a lot. It's a lot. It's not going I heads not what I had in my head.

[00:32:18]

Chloe, how many degrees did you get for this dollar amount? I have well, I have a bachelor's and master's, but I started out with an associate degree, but yeah. All right.

[00:32:31]

OK, so what's your household income? About 200000. OK, and this student loan of 123, what else you owe on? Right now, we're still we're still working, baby step two and I have my car, that's fifty nine hundred dollars. That's the second to the last of that. The rest is like a fifteen hundred dollar credit card and an eighteen hundred dollar. We owe taxes for this year and another credit card for twenty nine hundred. OK, you got the whole assortment here.

[00:33:15]

And how much is owed on the mortgage. How much are you on the whole? So the mortgage of about 89000. OK. All right, so in looking at this first and foremost, got a couple of things got to happen. Chloe going to have to have you shift your thinking, OK? OK, because right now what you're doing is you're feeling the weight of the of the of being what's called normal with the various credit cards and and things.

[00:33:42]

And I really want you to get super serious. How old are you, young lady? I'm thirty eight. OK, I want you to get hyperfocus now, I'm going to answer your question. What would you do because of the size of this, you're still going to attack the student loan debt before the mortgage, OK, because we're talking about now consumer debt. So the credit card that you have for 1500 is going to be the first thing you're going to attack first thing around tech.

[00:34:08]

Actually, the taxes, OK, that that thing's going to go to the top of the list because there's penalties and interest that can accrue on it. And then you're going to work through the taxes, then the credit card, then to the car, then to the student loan. And that's the mindset you're going to have around it. Once you pay that off, then you're going to again, you completed baby step two. Now you're going to start to build up your emergency fund.

[00:34:30]

Then you'll start to invest, then you'll save for college, then attack the house. So the baby steps, they won't change just because of the size of the debt. So that's the process and that's the math you're going to have to follow. And psychologically, you're going to have to really decide on this.

[00:34:47]

And I'm going to tell you, I want you to close these credit cards, close them, call them and shut them down. Don't just cut it up and send me a photo because people know how to call and get a duplicate card. Hello. Born at night. It just went last night. And so I want you to shut it down. And when you do that, that's where you go from the difference of talking about it to being about it.

[00:35:07]

And that's what has to happen because there's going to be stupid out there lurking, waiting on you to sign up for it. Offers are going to come in the mail.

[00:35:15]

There are computers, there are algorithms designed to hack your brain and get that plastic out of your wallet.

[00:35:22]

You ever notice how you talk about things that pops up on your computer? Yeah, they're listening. Yeah, I know. I shouldn't have said it around.

[00:35:29]

You forgot. You're one of those conspiracy theory dudes tween you and Rachel Cruise.

[00:35:33]

Not a conspiracy theory if it's true.

[00:35:35]

Chris, settle down. Settle down. But here's the thing that no matter what they do out there, we have to learn how to stand up for ourselves and say no. And I'm telling you, Chloe, I want you to do that. I hear it in your voice and you're like teetering, like you're interested in kind of getting out of debt and maybe it'll work out.

[00:35:54]

Like, that's kind of no. I want you to get the mindset of we're doing this. This is the direction we're going, and I'm not falling for this stuff anymore. And the difference between the two is one that will do it versus one that's going to stop at the first time you hit an impasse. The first obstacle and it's not commitment.

[00:36:13]

Nope. And here's the deal. Chloe's got a big shovel to dig out of this hole. Three thousand dollars a year.

[00:36:19]

They can go go wild, get gazelle intense 24 months. They could have cleared up a big chunk of this debt, all of it.

[00:36:27]

Oh, I completely agree. Twenty four months. That's two. Two years. Right. And again, people say, oh, gosh, it sounds like forever. No, no, not when I know people that have had student loans hanging around for sixteen plus. Right.

[00:36:40]

You know, and so realistically, he's my age who are doctors and professors whose kids are going to college and they're still paying on their student loans.

[00:36:48]

Yeah, it's real. All right. I want to share with you the scripture of the day coming from Romans five, three, four. Not only that, but we rejoice in our sufferings, knowing that suffering produces endurance and endurance, produces character and character, produces hope. A quote from the days from Eleanor Roosevelt. Once philosophy is not best expressed in words. It is expressed in the choices one makes. And the choices we make are ultimately our responsibility while.

[00:37:21]

Strong words, that means you don't got to just talk about it. You've got to live it and you can't blame people when it doesn't work out. I mean, that's reality, right?

[00:37:29]

And, you know, it happens from time to time.

[00:37:33]

And I think, you know, I talk about that in my book Everyday Millionaires', that this mindset, this victim thinking is one of the most dangerous thinking out there. I think it's one of the plagues we have, because what it does is it seeks to blame somebody for your lack of OK. Right. And when you do that, what happens is you can get in a mindset of that where you can't even enjoy someone else's success or can't be happy for them because it now becomes about you.

[00:38:02]

That's dangerous. Yeah. Yeah.

[00:38:03]

And attaining your autonomy to somebody else. Yes. Right. Define autonomy.

[00:38:08]

It's handing your will, attaining your decision making. You control your control. Somebody else don't come in here.

[00:38:15]

Usually a little 20 dollar words like, OK, from Kentucky, you got to put things on the bottom shelf for me. I got it. I can understand. But no, you're right. And I don't want I want people to believe they can. You know, I think that's the goal of the show is to encourage people that where you are right now doesn't have to be where you end up unless you stop and where you've been doesn't determine where you're going to go.

[00:38:38]

I like that unless you just decide I'm taking my hands off the wheel, I'm going to be unintentional. We'll just we'll just go where this boat floats.

[00:38:44]

So let's do it. Unlike these cars they have now, they can park themselves. Maybe I have trust issues, but I can't let it happen. Keep your hand on the wheel where you are right now. You're going to navigate some stuff and you have some stuff coming at you, some debris, some time. And that debris can look like people. It can look like words and they can look like some hard things in life. But I want you to know you can get through this.

[00:39:05]

You just look back, you got some scars. And I like people with scars because they've been through some stuff. You can get through this as well. I want to thank James Childs, producer, Kelly Daniel, associate producer. I want to thank all of you for tuning in to the show. I even want to think, John Delany, for hanging out with me this hour. You did a great job, my friend, and I'm working on it.

[00:39:22]

And I appreciate you continue to teach me and let me hang out with you. Hey, you all. We're here. We're going to be back. Stay tuned. This is the Dave Ramsey Show.

[00:39:45]

This is James Childs, producer of The Dave Ramsey Show. Once again, you made The Dave Ramsey Show, one of the top four most popular podcast last year to get your daily dose of motivation and inspiration from the Ramsey network. Subscribe or follow today wherever you listen to podcast. 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.

[00:40:14]

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.

[00:40:41]

You matter and you have what it takes. Join the conversation on the Ken Coleman show. Hear more from the Ramsey network, including the Ken Coleman Show, wherever you listen to podcasts.

[00:40:53]

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.