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, Ken Coleman, Ramsey personality, number one best-selling author and author of the brand new book that just came out this week, Find the Work You're Wired to Do. He's my co-host today. You jump in, we'll talk about your life and your money. It's a free call, and some say the advice is worth exactly what you pay for it. The phone number is 888-825-5225. Emily starts this hour in Grand Rapids, Michigan. Hi, Emily. How are you? I'm good. How are you? Better than I deserve. What's up in your I just graduated college and got my bachelor's.

I am currently not in any debt, but I'm about to go into about $250,000 worth, and I won't be able to pay it off or start paying it off right away either. I'm very, very terrified over it. I was just hoping for some advice on how I can limit the debt, hopefully, and how I can pay it off as quickly as possible.

What, pray tell, are you doing?

I got accepted into medical school.

Okay.

Which one?

Michigan State, their MD program.

What scores did you have on all that MCAT stuff? Where were you ranked?

I was above average of scores. It wasn't the highest score, but All right.

It wasn't bad either. But it was pretty darn good. My guess is that Michigan State is a pretty nice little brand name program, and you should be proud of that. I'm going to jump in and say the way to lessen this debt is to think about going to a medical school that doesn't cost as much Because I can tell you who doesn't care about where you went to med school, and that's your patient. I have never once asked my doctors where they went to school and what their GPA was. I probably should, but I'm just telling you what's reality. Makes sense? Yeah. Have you looked into less brand-named schools and see what they actually cost? Then have you looked at, based on your above-average performance on the MCAT, Could you get a huge, huge chunk of that paid for? Have you looked into that?

Yes. This is actually, from my understanding, the cheapest medical school in Michigan, I believe. On top of that, I've been offered a $20,000 renewable scholarship. That'll take it down from the $250,000 to about $200,000.

You won't really feel that. Trust me. Why are we staying in Michigan?

This is where family is. Then the program that I applied to medical school only allowed me to choose from schools in Michigan.

But it is It's possible, and you're aware that there are other medical schools that cost a whole lot less and could probably give you a whole lot more scholarship. You're aware of that?

Yes.

All right. That's reality. You do not have to go to Michigan State Medical School.

Right.

Well, you asked.

I know. There's really no other answer, honestly, because you said, How do I limit this? Because you are going to be facing, and here, walk this out for people who are thinking I'm going to talk about this, because you've actually done the homework, I think. How many years are we talking about before you start to make anything resembling decent money after med school?

After four years of medical school, I'll have anywhere from 3-6 years of residency, depending on what I go into.

You're making what in residency?

50k.

Very, very little. Exactly.

That's your reality. You're choosing a name brand school to be close to family, and you're exchanging in that decision years and years and years of barely keeping your nose above water. I'm not trying to be depressing, but this is the decision.

I mean, yeah. Bottom line is, I don't really care where the school is or where your family is. If I'm you, I'm going to go someplace that I can severely change these numbers and not just be, Oh, I'm so happy I got accepted to med school. I will pay you anything because you like me. That's what usually happens. That's exactly what happens. Not excusing you that, Emily, but I'm just saying. Because med school is so hard to get in that when you do get accepted, it is such affirmation There you go. Well, those people like me, so I should really give them all my life, my whole life for the next decade. I just think it's very wise to rethink this. Where you go to law school, where you go to med school, changes the numbers dramatically. That's right. Dramatically. There are good doctors and good lawyers that come out of virtually any school that teaches law or medicine. There are very few hack situations, almost none. We used to have a thing here in Nashville that was called YMCA, Nashville Law. It was night school on Armory Drive to go be a lawyer. No way.

You could go be a lawyer at not doing night school. It was pretty much blue collar methodology. You just work all day, and then you go down there to law school at night. It took two years longer, but you could pay for it as you went. That's right. Then I actually had a guy that graduated from that law school that represented me one time, and he absolutely mopped the floor with the other guy. I mean, he destroyed the other side. But I guess something about that whole blue collar process set him up to be a fabulous litigator. But yeah, that's the thing. Emily, you just need to think through and not Follow the path of affirmation and follow the path of affirmation and follow the path of least resistance because it ends up being the path of greatest resistance if you're not careful. That's what we're trying to point out to you. That's right. We want you to live your dream, hon. We don't want you to live a nightmare. We talk to too many people on the other side of this coin. Man.

I think Dave of the Dentist that we feature so prominently in our award-winning documentary, you can get it on Amazon or wherever, bar of future. But I just remember I can feel it right now. The very first time I watched it, our entire staff watched that Dennis talk about the debt that he had.

He had a million dollars. A million dollars.

It was soul-crushing for me as a consumer.

He was a surgeon.

Dave, what's happening is- He got out. He did get out of it. It is, by the way. But what we're actually trying to do here, Emily, is keep you from getting in the middle of that. Dave, there's a false choice in society right now, and I'm not trying to demonize med schools or higher ed, but there's a false choice. Folks, you just heard Emily walk through it. The false choice is follow the emotion, as Dave said, of affirmation. Let's be honest, it's impressive to be a doctor. Doctors are still one of the most respected positions in society. We get it. But we are told to follow the emotion of the accomplishment of the affirmation and not exercise logic. I just walked her through, Listen, I'm as dumb as a doorpost compared to med students. That's just basic logic. We don't tell kids there are med schools that would die to have Emily join them this fall. She doesn't even look because it's not even considered an option. It's not her fault. It's what society has done here. Anyway, food for thought.

Something to think about. That's what we're here to mess with you. It's our job. This is The Ramsey Show. Hey, listen up. Everyone is at risk of identity theft. I don't care if you're a hermit living off the grid listening to the show on a battery-powered radio. All of your data collected by every company you've ever done business with, lives online. Your bank, your doctor's office, retailers, the apps on your phone, the gas station where you have loyalty rewards, they all store your info online, making them ripe for a cyber attack or data breach. That's why I've been telling people for almost 25 years, they need an ID theft protection plan, and the only one I've ever recommended is from Xander Insurance. They monitor your personal and financial info, even your home title, and take over the work if you become a victim. It's the most thorough and affordable plan out there. I even have it for my family and our entire team. Visit zander. Com or call 800-356-4282. Ken Coleman, Ramsey personality is my co-host today. Open phones at 888-825. Com. 5225. Isaac's in Sacramento, California. Hi, Isaac. Welcome to the Ramsey Show.

Hey, guys. It's an honor to talk to you.

You, too. How can I help?

Well, I feel like I'm going to be paying quite a bit of stupid tax here with this question. My wife and I, we took out a home equity sharing agreement with one of these companies, and we had good intentions. We wanted to pay off some higher interest debt, and that all got paid off. But now I'm staring at this agreement now that it's been a little while, I'm looking at it and it's just becoming more and more daunting. Basically, they gave us a upfront cash investment of about $62,000. Any time between now and about 30 years from now, we can choose to square up with them, but they get the $62,000 plus 40% of the appreciation of my house from the time we signed, there was an appraisal, to 40% of the equity between the time we signed and the time that we settled. We have that time. I'm just wondering- If you did that now, how much would that be today? Well, we'd have to get an appraisal, but approximately, yeah, maybe probably around $100,000.

Okay. So this makes a payday lender look like a sweet deal.

It really does.

You sold your soil to the devil.

Yeah. And so hopefully people hear this call and just never do any home equity sharing agreement of any kind.

How long ago did you do this?

About eight months. So that makes it even worse.

So you make $100,000 return on a $60,000 investment in eight months. Correct. We don't call that Highway Robbery in California? Hmm. Interesting. Hmm.

Okay. Yes, sir.

I am. I don't have an answer for you. I mean, obviously, the sooner you take care of this, the better the less it's going to cost you. I might call them and beg for mercy. If I get you a check now for the 60, what is the minimum you would take on top of the 60? I mean, double your money, that'd be a deal, right? For them and for you. I mean, if it only costs you 100% interest and not 200% interest, that's a pretty good deal. Just by talking to them, compared to what you got, right? As far as I know, what you've done is perfectly legal in terms of, is there some a basis to go at them? No, I think you just signed up for a really ugly trip and are getting to take The only thing I can think of is, first off, is try to talk them down and then go refinance and take care of it immediately. Then second off, if you can't do that, you've got to end the cost as quickly as possible, because every day you screw around with this in California. In Sacramento, your house is going up in value, and every time it goes up in value, $1,000, they get $400.

I'm just curious, what did you do with the $60,000?

He paid off the debts.

Oh, I missed that.

He paid off his debts.

He paid off debts. Okay.

Yeah.

In reality, we just made our situation worse.

You were just so stressed out and freaked out that you just didn't look at this. Is that what happened? You had to willingly close your eyes to how bad this was for some reason. What do you think that was?

I think it was just seeing the debt and then seeing how long it would take and then because I was working hard to pay off the debt, which is perfectly fine.

You had to run these numbers.

Right. I just figured I'd let it I'd let it grow until I was ready to sell my house and then just the values weren't going to go up. It was a lot of little things, and I'm not justifying my decision.

No, I'm not either. For folks listening, I'm trying to get inside the headspace of someone who's so desperate that they don't look at a deal that's this bad and go forward. Because I always talk about on here, man, that the dumbest things I've ever done in my life was when I was desperate. Right after I get desperate, I get stupid. I can look back and tell you about 10 different times where I get freaked out, I get put in a corner, I can't move. I do something desperate and I get stupid. It It's just not a good plan. Anyway, aside from that, for you tactically, it's very unpleasant, but you're in a very unpleasant scenario. Best case is you talk them down and you go get some money right now and pay them out. Talk them down to 100% return on their money in eight months. That's a sweet deal for them. Compared to the terms you've currently got, it's a sweet deal for you, right?

Yes.

I mean, if you call me up and I was in this deal and offered that, I'd be thinking about it if I was the other Get out of this. Have them think about it. Then if you can't do that, then you either refinance and buy them out today and in this, because you've got that option, or sell the house. And get out of it. That's your most painful of the three, staying in the property and letting this thing continue to tick, letting this bomb continue to tick in your closet. Nope, not doing that. You're going to wake up 10 years from now and your whole life is going to be screwed. Meanwhile, you could have been owning a house that you owned and so forth. You need to clean this up in the next six months by talking them out of it, refinancing or selling. One of those three. If you can come up with another idea, I'd be willing to listen. I just don't know what it is. That's the first one that comes to me. Shared appreciation mortgages, SAMs, came out in the '80s. They showed up in the '80s to try to get a lower interest rate because rates We were so high in the '80s.

We were in 12%, 14%, in the early '80s, 18% for a few minutes, real estate market. In order to get a decent rate and come down to a 10 or a 9, instead of getting your money as the mortgage maker on the interest rate only, you could also participate in the mortgage, shared appreciation mortgages. Actually, FHA came out with a program that underwrote Sam's. Now, they weren't as onerous as this guy's. Boy, that's a mess he got into.

I was going to say, do you think this meets the criteria of predatory lending?

From a legality standpoint, no. From a moral standpoint, 100%. When you're making userous amounts of return... But again, the company did not mislead Isaac. That's correct. He walked into this straight up with his eyes open and just said, Sign me up for stupid. I've done that, so I'm not picking on Isaac. He's beating himself up enough without me beating him up. That's not the point. But it's definitely predatory. But so is payday lender at 800% on a $200 cash advance to poor people. But it's legal in most states. It's absolute scum. It's a horrible product. How do you sleep at night doing that to somebody? No.

I mean, they're basically stealing equity out of his home.

No, they didn't steal it.

Well, okay.

He gave it to him.

I'm saying conceptually, though, the deal works out for them.

Oh, It's unbelievable. They said, We'll give you 60,000 bucks and you can't get it anywhere else because you're broken in debt and your credit's bad and everything else. Here you are, desperate, and you just have to sign over three of your children We're going to put them in the safe and feed them through the door until you come back and get them. That's what we're doing here. It's Hansel and Gretel, right? Oh, man. Some of you people need to look up Hansel and Gretel. You don't know who that is. It'll be good for you to read a good paper. So true. Oh, my goodness. The chicken bone and the whole thing. Look it up, people. Look it up. This is the Ramsey Chef.

This show is sponsored by Better Health. Hey, it's Dr. John Deloney, and one of the most common questions I get is how to get something off your chest. A deep secret you've never told anyone, or maybe something that happened to you, something you've done that you're worried about because bringing it to light will disrupt your life. Anything. I say this all the time. Secrets will kill you, but it's hard to know where to start when it comes to talking about scary, dark things. Therapy can be a safe, effective place to get things off your chest, to learn how to say hard things out loud, and figure out how to work through whatever is weighing you down. I've personally been blessed to have a great therapist who helps me get those heavy things off my chest. If you're thinking of starting therapy, give better help a try. It's flexible because it's online, so you can suit it to fit your schedule. Just fill out a short question You get matched with a licensed therapist, and you can switch therapists at any time for no extra cost. It's time to get it off your chest with Betterhelp.

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Well, your graduate just spent more than 4,300 hours in class. We're guessing no one taught them how to handle money. Could be wrong. But unless they were in a school where they were teaching the Ramsey curriculum, which a lot of high schools are teaching it, thank you. But probably they got nothing. You got graduations everywhere right now, from college, from high school. You got weddings everywhere right now. Man, we got a couple of really good ideas for you. The Total Money Makeover is celebrating its 20th year. We're going to be announcing that formally soon. We're just under 10 million of these have been sold. Of course, it's on sale for you, graduates. It's at bremsysolutions. Com. Be sure and check it out. George Camel's book is probably better for a graduate because it's more relatable because George has got the millennial snark down to a freaking science. You will love this. I I loved it because I love the millennial snark. So Breaking Free from Broke: The Ultimate Guide to Mow Money and Less Stress. Check it out. It was number one best seller. It's on sale right now for graduates. And Ken Coleman's book, Oh, Maybe We need to go into work that we're Wired to Do.

Do the Get Clear assessment, which almost 100,000 people have taken at the ramsey solutions. Com website and used it to figure out what they need to do, who they are, where they're going. And Ken, the book took off. It did a great kickoff this week. When you buy this book, it is the guide on how to read the assessment that comes with it. You got a code for it.

Yeah, it's essentially about a 40-minute read, and it's me coaching you through your actual results. So once you know what you're good at, what you enjoy doing and results that you care about, how do you now ideate and select an actual professional path to where you can become the networth millionaires that we studied that love their work and they're crushing it? This is a coaching manual that really comes with the assessment. It's a fun tool. Self-awareness is a superpower. That's what I've learned about successful people.

Don't you wish you got some of this stuff at graduation instead of whatever it was that you got? I don't even remember now.

I don't either. I think I got a tie for my grandfather.

Someone gave me a very important item. I'll tell you what it was. A gold cross pin. Now, I- Remember cross pins? Let me tell you.

Of course I do. Those were big. My dad used to write with those.

Before the Mont Blanc That's correct. If you were cool, you had a cross pin and a cross pencil. You put it in your highly starched pocket. Right there in your highly starched pocket. This lady knows what we're talking about. But you got to be old to know that. Not that lady, but the other people got to be old.

Yeah, you aren't old, ma'am.

We are. Not that, yeah. That's like I go back and look at the early Dave, before the Mont Blanc was in that same starch pocket to prove that I knew something, the two cross pins were in there.

That was my great- Did you have a gold and a silver?

No, I just had the gold. Just the gold.

That's all I had was the gold. Big deal. My The guy got me one. I thought that I had arrived.

I'm pretty much an adult now. Yeah. Pretty much. I got a cross pin. I'm ready to write stuff now. Ramseysolutions. Com/store. No pins will be sold. That's correct. Only books. Check it out. Kim is with us. Kim is in Chicago. Hey, Kim, how are you?

Hi, you guys. Doing well. Thank you for taking my call. Sure.

What's up?

Well, my husband and I, thankfully, thanks to you guys, paid $180,000 in debt earlier this year. So we're super excited.

Wow, wow, wow.

Yeah. So it was 110 student loans and 70K in car loans. Man, you knocked it.

Way to go, kiddo. I bet you feel free.

We feel really good. Thank you. Yes, thanks to you guys. I mean, we followed the baby steps. We got really intentional and had three babies along the way, but we did Very good.

Good for you. How can we help today?

Well, now I'm in Baby Steps 4, 5, and 6. I have a mortgage of 390, and I'm saving for kids college and also our retirement. I'm doing 15% on my 401k. My question is, my husband is a police officer, and he's going to receive a pension, which is 75% of his income at retirement, and he does not have a 401k there. I'm trying to figure out how do I fund his 15% for retirement.

It's our 15%, We add up our total household income, and we need to get 15% in retirement somewhere. We do not have a 401k at his place to work with. We have one at your place to work with. You have two Roth IRAs you could do as well. So another 6,000 each there. If you maxed out your 401k and you maxed out $12,000 worth of two Roth IRAs, would that equal 15% of your household income?

Well, my household is 2010.

Okay, so you need about 30,000 bucks going in. You're going to get close. You're not quite going to be there. But you're probably just going to max your 401k and max two Roths. That's about as close as you can get. Unless you got some self-employed income anywhere, Do you?

I do not, no. Okay.

Yeah, I think you're probably limited to that. He does not even have a 403(b) at the police department?

I just asked him that to look into it a little bit more. He said he was not aware of anything like that, but I'm going to check in a little bit more because I've heard of that one, but I wasn't sure exactly what that was.

Most of them have a deferred comp, 457, and/or a 403(b) in addition to pension. Both of those would work. I would rather use your 401k and max it out and then do two Roths. If that doesn't get there, then I would use a 403b or a 457, one of the two. They'd be my last choice, though, to get to the whole 15%. But the point is we're dealing with 210 times 0.15, so we're in $31,000. We're trying to get 31,000 into something. That's the point. Between those two, it doesn't matter whose name it's in, Because you have marital rights to your 401(k) of your spouse. In other words, if there's a divorce, that's an asset that's laying there that gets divided up. If it's all in your name, it doesn't matter. Like the big 401(k) load up I'm talking about here. But the point is just take your household income, 15%, going into something for a retirement. The best thing out there, folks, for those of you listening, is a match. You want to do that first. The second best thing is Roth. The best thing of all is Roth with a match, okay? But match, Roth, traditional.

So match beats Roth beats traditional. It's rock, paper, scissors, except there's only one way to win, okay? Match beats Roth beats traditional. If you just go down that path, then you can do... And so the 403(b) and 457 would fall in the heading of traditional because their tax deferred like a traditional IRA or traditional 401(k). Same Same mess there. Same pile of fish hooks. Danan? Danan is with us in Morgantown, West Virginia. Is it Danan? Is that correct?

Yes, it's Danan, sir.

Sure. How can I help?

Absolutely, Dave. I have about $74,000 worth of debt, 60 of which is my house. At the end of the year, I'll have my car paid off, which is the other 14. Then I'm getting a $20,000 bonus from the military. Not for sure if I should use on buying a new house or just throw all of it at my current house.

What's the bonus for?

The military. It's my reenlistment bonus. Okay. All right.

Thanks for serving. What branch do you serve in? The Navy, sir. Okay, cool. Good for you. All right. How long you been serving?

About six years.

Okay. You may have landed there and going to stay there, in that location, or are they going to move I'm Reserves.

I live out of Morgantown, West Virginia. I do travel four times a year with the military.

Got you. It's Reserves. Okay. All right. That part I didn't catch. Okay. That makes more sense then because you're in 100% Then I'm throwing it at the house. You're in Baby Steps 4, what we call four, five, and six. You have an emergency fund of three to six months of expenses?

I have roughly two right now. I'm currently throwing into it.

When you get the car paid off, let's beef up that emergency fund. Okay? A fully funded emergency fund and debt free but the house leaves you in baby steps four, five, and six. Now you're starting to attack that way, and you just throw the money at the house at that point. Let's just get this house paid off. You only owe 60 grand. Way to go, man. You're killing it. Good job. This is the Ramsey Show. Guys, it's no secret that the real estate market is weird right now. So go with a mortgage company you can trust to have your back. Churchill Mortgage. Churchill is Ramsey trusted because they're stable, reliable, and focused on you. At a time when a lot of companies are being bought out or going out of business, count on Churchill Mortgage to stick around. They've been doing things the right way for over 30 years, and they'll keep doing them the right way for 30 more. Get started at churchillmortgage. Com. This is a paid advertisement. Nlls ID 1591.

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Ken Coleman, Ramsey personality, is my co-host today. Thank you for joining us, America. If you like the show, you could help us. We could use your help big time. You want to help? Ready? Set, go. Here's what you do. Click, follow or share the show or subscribe or leave a five-star review. Mama said, if you're getting anything nice to say, don't say nothing at all. So try that, you little trolls. Have some fun out there, people. Hey, spread the word. We appreciate it very much. We know that we were the fourth show in history on Apple podcast to have a billion downloads. That was a year and a half ago. Joe Rogan was one of the first and it was one of the NPRs and then us. Now we're at a billion and a half downloads where you get about a billion minutes watched on YouTube every 35 minutes. It's crazy. I mean, it's nuts.

I need to call my mom real quick.

Billions and billions and billions of you. I mean, the number of hours and minutes consumed by you guys out there is crazy. Thank you so much. We know you're there, and we know you're spreading the word because the numbers are growing. So thank you and continue to share the show and spread the word and subscribe and follow and all that stuff. It does help us because it changes the algorithms and pushes the show forward to other people to see it. Lauren is in New York City. Hi, Lauren. How are you?

Hi. Good afternoon, Dave.

Afternoon. How can I help?

I am at a point where I am drowning in credit card debt. I have about $70,000 in credit card debt currently, and I can't really stop the bleeding. It's all due to attorney fees.

You paid $75,000 in attorney's fees?

Also moving. I was in a situation where I was married, and my husband was an alcoholic and substance abuser, and I had to get out of that situation.

So what did you spend to move?

I'm in Westchester, so it was about $9,000 to move between broker fee and security.

So you spent 60,000 bucks on lawyer fees?

Yes.

For what?

I've had to fight tooth and nail for my child. It's been a very challenging court case. At this point, the court has ruled he cannot have access to my nine-year-old daughter. But it's been contempt orders and violation, not on my part, on his. Also, there's an attorney, Guardian Ad L'Item as well. I'm paying both of the attorneys. It's just been a very harrowing experience that we are, thankfully, going to come to the end of hope soon by the end of the year.

Okay, so the bleeding is stopping then. It will towards the end of the year. What a horrible thing you've been through. I'm so sorry. What do you make? What's your income?

I make $90,000 a year, and I'm in a very expensive area that I'm not legally allowed to leave. I am currently working at a nonprofit organization, and I can make more money. I have a doctorate in physical therapy, but I am tied my job for the next two and a half years because I have extensive student loans totaling in the amount of $260,000, and I'm in public service loan forgiveness, and I only pay for 14 months. After that, my loans will be forgiven. Plus, they're very flexible. I have a daughter with special needs, so I'm really stuck at that amount right now, making that $90,000. The way it stands right now, I'm basically barely making my at this point, and I do not receive any type of child support or anything like that. I'm just making the bare minimum on the credit card payments. I'm trying to figure out when this is all said and done and I can go in. I can't touch anything right now.

Is there any financial settlement that you're going to get from the divorce?

No, there's absolutely nothing. I'll be lucky if I get child support at this point. I'm not going to bank on anything at this point.

If you could, I understand the limitations It's based on the loan forgiveness, but could you practice physical therapy today, just theoretically on paper, with your current qualifications?

The answer is yes, but I also have a daughter with special needs that requires a lot of my time. If I had to pay for childcare, plus finding a provider that would be able to provide that childcare, I'm in a very difficult situation.

No family support or friends in Westchester at all that could help out?

No, my family is from Florida. I don't have any family here.

Okay. Here's what's going to happen. Something's going to explode because you have painted a picture that says, I'm stuck in the corner and everything around me is wet paint and I can't move. And yet you're going to get your feet, you're going to get pain on your feet. Something's going to give. This is not sustainable. That's why you called us. I don't know what it is it's going to give, but something's going to happen here, and it's not going to be pretty. You're going to have another set of problems and anxiety-ridden mess following this anxiety-ridden mess of a divorce because you painted yourself into this corner of, I don't have any choices. I don't have any choices. You better make some because what you're telling me isn't sustainable, and you know it's not sustainable. You need to get your lawyer that's so dead gum expensive to go before the court and get you out of Westchester County, and you need to forget the stupid loan forgiveness because you're probably not going to get it. You need to go make about $200,000 a year and get your freaking life back or something. I don't know what it is, but Something got to change because everything that we bring up, everything we talk to you and ask you about is a trap.

I'm trapped. I'm trapped. I'm trapped. I'm trapped. That was the answer to every one of your questions. I don't have any choices. I don't have any choices. And yet the math is not working. So math will not give you a pass. Math does not believe in grace. Math does not believe in mercy. It's going to come for you, and it already is, and you're feeling it, and that's why you're calling. I'm not trying to scare you, but your process by all the stress you've been through and all the damage you've been through, it has made you believe that you are trapped and don't have choices. I'm challenging that. You do have choices. You better make some. You better change something here because you're not going to get help from him. I'm betting that the student loan forgiveness doesn't work because such a low percentage of those actually do go through, and you may have sacrificed a great income for a lousy income. I don't think you're trapped there. I think if you go before the judge and go, Your Honor, I don't make enough money to live in Westchester. I can't live here. Help me out here.

Where can I go? What can you tell me what to do? You go before the judge with that, Plead, and then you go, Okay, now, how am I going to work with this special needs child and give them proper care and also be able to feed them and house them? You can't The math that you've given me doesn't continue. Something's going to come up short, and it's going to choose you if you don't choose it. That's what I'm saying. You're not stuck, but you do have a very difficult situation. And part of it is my heart's breaking for you, honey, because I hear your language as if you have been abused in this relationship. So if you were in a domestic violence situation, one of the things the abuser convinces the person of is that they don't have any choices in that they're stuck. You can't leave. You can't afford to live without me. So you have to stay and be my punching bag. That's one of the lies they tell. Then you start to believe that lie yourself. Now, you broke free of this guy, but your language of I'm stuck, I'm stuck, I'm stuck, I'm stuck is breaking my heart because it still sounds like he still owns I want you free from him and free from this trap and free from all this.

I wish I had a magic wand. I could just say there's an instant thing here. But the one thing I will tell you is you got to make some different choices. It's not working for you, hon. I'm so sorry.

She can find people that can help take care of the child, but she's the only one that can feed the child. For that reason, I would drive this home. I would be getting into physical therapy and making the most money possible. That gives you more options.

I'm stuck in a nonprofit making no money in the most expensive county in freaking New York area, except possibly Manhattan. 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, host of The Ken Coleman podcast on The Ramsey He's my co-host today. Open phones at 888-825-5225. Jordan is in Columbia, Missouri. Hi, Jordan. How are you? I'm good, Dave. How are you? Better than I deserve. What's up?

Yeah. My burning question is that I'm getting married here shortly. I've got a good chunk of cash saved up. We're looking at getting into the real estate market, but we'd like to know before we start having kids what the lowest what the best risk method is for what we have in front of us.

You're talking about your home or a rental property?

Rental, building spec, and sell. It's a toss-up in the air. I'd really like to know what the best- But you own a home that you live in? We are actually currently building a house that we're about to start living in.

Okay, good. And is it paid for?

We're going to have about a $40,000 note. The rest, we pay in cash.

Good. Okay. First thing I'm going to do is pay that off.

Okay.

Okay. Now, then when I've done that, then what type of real estate? Now, there's real estate investing, which is a buy and keep it idea. Then there's real estate speculation, which is why they call them spec homes. If you're building a spec home, it's a speculation that you can sell it. It's a short-term play. It's not a long-term play. It is speculation. Flipping houses is speculation. Both are high risk because obviously, if you pay cash for them, it's not as much risk. But if you pay cash for a house, fix it up and flip it. If it doesn't flip, at least you're sitting there with a paid-for house, right? You'll figure it out. You could rent it or do something else. But you need to separate the mentality of what is the lowest risk. The lowest risk is a buy-and-hold strategy because real estate goes up over time. When you have to sell that spec house or your money is sitting there burning taxes, property taxes, it's burning insurance, even if you don't have a note on it, it's sitting there burning money until you sell it, whether it's a flip or an actual build of a spec house.

But that's speculating is short term, investing is long term. Now, when you go to investing, probably the entry point would be a good home, single family home in a solid neighborhood. Not super expensive, but also not trashy. That's the lowest risk.

Can I ask you this as well? Sure. Where we live, there is a lot of inflating house prices, if you must. So there's not a whole lot in the market below the $250,000 range, probably within a 15 to 30 mile radius. And so with that, I actually work for a builder. One of the initiatives that they've talked about, but I'd really like to do is maybe build a cheap speculation home to sell to a lower income family simply because I have the high confidence that it would sell quickly just because there's nothing really in the market for it. What's your thoughts?

It's just a side hustle. It's not an investment. Okay. It's just your side hustle is you're building houses that you flip. Got you. That's not bad if you're paying cash for it and if you've analyzed and said, Okay, what are all the downsides? What happens, and you got to be able to answer this question and not throw up, what happens if this house doesn't sell for a year after you finish it?

Spend a lot of money. Okay.

I'm just saying, you got to be ready for that because I don't know. I don't know what's going to happen. I think you probably do know the market. You're probably right. In most markets in America, if you build something less than the median house price in the area, you have a very marketable property because entry-level properties are just nonexistent. They're very hard to find. Just about whatever the median price is, and you said in your area, it sounds like it's 2,250 then there. If you build something in that 150 range that's a nice little home, man, it'll probably go fast.

Yeah.

I walked through one that's about, let me think how far, it's probably 80 miles or something like that outside of Nashville. It's out in the country. Down there, one of my Lakehouse, there's a guy building a house on the corner up there, and I walked it one day, and he was in there, and I walked it with him. I was like, Wow, this is a nice little... It's a 1,750-foot, little three-bedroom, okay, three-bedroom, bath and a half, two-car garage, and not super fancy, but it was well-built. Nice little brick out, a little brick and siding house, right? It was 188 grand. It was unbelievable. I thought, Wow, this is like all these people are here, You're a cab, buy it? Well, yeah, you can. But it's out there. It's out in the country. Where you are, you're probably in a similar feel in the Columbia. Columbia is not a huge town. There's a whole bunch of Columbia-esque-sized towns around you, but you got to get all the way to St. Louis or Kansas City or even Jeff City before you get to a major town, right?

Right.

You got a lot of rules, rings around you, if you will, that could fall like that little house I'm talking about. But that was a sweet little house and not a bad... I'm thinking a young couple coming in there or somebody wanting to downsize it. Brand new everything, of course, dishwashers and all that stuff. It's like, Man, I could live there easy when we first got married and called that a palace. But again, it's freaking hour and a half or more to Nashville. In this area, that's considered a crazy commute. But my point is that if you get below that median house price, and that house sold before he broke ground on it, probably. He sold that thing so fast. But that's a great place in the marketplace. I think what you're talking about makes sense, is my point, but I'm not an expert on your particular market. But But that's a good place to be. If you told me you wanted to build million-dollar houses in a 250 market as spec, I'd tell you don't do it because you're going to end up with a million dollars sitting there. But that's not what you're talking about.

Do you have a temperature for him, whether it be renovate something or build something brand new in that space?

He's in the home building business. He's got the itch. He's going to build. He's going to do it. I think you're right. I would tell most people not to do it, but he's in the business.

I agree. To your point, at that price range, I would imagine they're going to have a lot of people trying to get in that house if he builds it at the right price.

Oh, yeah. They'll be a line around the block, I suspect. Again, the point is this, it's not really starter housing, but it's anything below the median price point. Median meaning middle, the middle of your market. The median house price nationally right now, I think it's bumping up close to 400. Forever, what's it saying?

Says 394.

Oh, there we go. Almost like I knew what I was talking about. Who knew? Yeah. Okay. That's impressive. Yeah. Okay. Let's call it 400.

Well, that was the listing price. The median sold price was 288 in Columbia as of April.

Oh, no, that's Columbia. Columbia, Missouri. I was talking about nationally. Oh, sorry.

I was pulling up his area.

Nationally, it would be over 400. Okay. I'm probably wrong.

Sorry. I went to Columbia.

That's okay. It's a good place to go. This is the Ramsey Show. May 21 and 22, I'm going to be doing a two-night virtual event, meaning you have to be there both nights or you won't see everything. I'm going to unpack my personal playbook on buying real estate and on investing. It's an advanced investing class, Dave Ramsey's Investing Essentials. I've never taught this stuff before. It's stuff I do and have learned over the years, but it's not stuff I have taught. If you want to do an advanced investing class, it's 199 bucks. We've got, I don't know, 3,000 or 4,000 already signed up for it. Thank you for coming. We appreciate that. If you're interested, it's ramseysolutions. Com/events, and that's Dave Ramsey's Investing Essentials. We'll be We're going to be having questions live throughout this class as well. George Campbell is going to help me with the whole process because he knows how to interrupt me and answer a question and all that. We're going to do that. It's going to be fun. We've already been talking about it and laughing out loud as to how much fun it's going to be. But George is always fun.

He's hysterical. Diana is in Philadelphia. Hi, Diana. How are you?

Hey, guys. I'm good. How are you?

Better than I deserve. What's up?

My question is, my husband and I are deciding whether we should buy a new car or not. We are looking at used. The situation basically is right now, we both have vehicles. My I have a $350 car payment on. My husband's car is paid off. It has about 100,000 miles, and it is out of inspection. It has no air conditioning. It needs about $4,000 worth of work. We do have two young children, so we do rely on that vehicle as well for transportation. My question basically is- How?

If it's out of inspection, Does it have a tag on it?

Yeah. When I say it's out of inspection, it's as of this month. It's something where we're coming up on about, should we pay to have all this work done to keep it inspected and legal after this month is up, or do we go ahead and proceed with starting the process of looking for a new car, a used car, or something along those lines?

Okay. You don't have any money, do you?

We have money and savings.

How much?

We have about 20,000 in savings. Okay. All right.

The first thing is I'm just calling BS on the 4,000. I think you cooked that number because you wanted to get rid of the car. I think you can actually get that car fixed for probably half of that if you start working on it a little bit. But you jacked it up because you're sick of it and you're trying to figure out a way to justify getting a car. If you want to get a car, it's okay, get a car. But I don't think it takes $4,000 to get that car back up and get it running to where it should be to pass an inspection. I think you can get a different mechanic to look at it, somebody that's not I don't know where you went. Don't go the dealer to get a car like that worked on for sure. But anyway, let's figure out exactly what's wrong with it, because here's the problem. If you don't get it where it passes an inspection, it's going to sell for $4,000 less.

Okay, right.

You can't give it away.

Yeah, because that was the other thing is if we traded it into a dealership, sell it privately to have that fund as a down payment.

Yeah, you can't. Well, you've got $20,000. I think you probably get the car up and running and where it'll pass inspection for a couple grand and then sell it. Then if you want to sell it and move up in car a little bit some cash, that's fine. But buying a new car? No, you're broke. You don't have the money for a new car. You certainly don't need a car payment, and you need to get your car paid off as fast as you can. You got to get out of the car payment business, kiddo, if you don't want to be broke your whole life. Folks, if you want to be middle class the rest of your whole life, keep a car payment. Mathetically, it'll just hold your butt right there. It'll just keep you from succeeding. It'll keep you from prospering. Just go, Well, everybody's got a car payment. It's just the way it is. Car payments are just the way of life. That's exactly how people that are middle class speak and talk and think. It just keeps you right there. It just locks you in. You cannot get it. You can't break free from it.

You got to go, No, I've had it. Not paying payments on these stupid automobiles ever again. These are the words of rich people. People that become wealthy are the ones that get rid of car payments. I could get rid of my car payment if I was wealthy. No, you missed the point. You could be wealthy if you got rid of your car Pay me. You got that backwards. Now, Diana, that's the cycle I want to break in your whole discussion. I don't care if you fix this car up and sell it and move up into a little better car. It sounds like it's a piece of junk. I don't disagree with you on that. But then we need to get your car paid off as fast as we can. We need to get in a game plan here where we stop talking about cars as if they're a constant crisis and instead get around in front of it and start managing the vehicles in a way where they We don't own us. We own them. That requires a different thought pattern than, Oh, well, we're screwed. We got to go get a car payment. We're stuck.

Can't get an inspection. Got to go get a car payment. That's how your question sounded. Maybe You didn't mean it sound that way, but that's how it sounded, and you want to break that cycle.

I'm old school. I didn't have time to pick it apart, but I'd want to know what repairs are necessary just to pass inspection. Tennessee is a whole lot different than Pennsylvania, so it could be sizably different. But if I was worried, I wouldn't be worried about the air conditioning. I think kids these days need to stink and have the windows down and let it blow in their eyes and in their hair. My goodness. I drove a car without air conditioning for a year and a half when Stacy and I first got married because it was a cash car. I drove in the morning, I drove in the afternoon. It was like, Come on. Some of these things are about saving up money, suffering a little bit, and how big of a deal is it to suffer and have your kids have the summer air blow through the car? I wouldn't fix the AC on that car.

You sound like a boomer.

I on this issue. Here's my point, because then I would say, I'm with Dave, I would spend the minimal to get the inspection and then sell it and then buy a $10,000 car.

And get a car with air conditioning, for God's sakes.

Then, yes. But until then, you tell people not to see the inside of a restaurant. Now, I'm the owner for telling them to let the wind blow through their kid's hair.

Well, I mean- Thank you, folks. The audience agree. Listen, I don't have any hair, so it doesn't matter. Mom always called our air conditioner on our old car when I was growing up, a 240, two windows 40 miles an hour. That's what she called it.

I get them a full cup of ice and roll the windows down. Just boil right over the car.

A couple of dinosaurs here giving out advice to non-dinosaurs. But yeah. Honestly, you drive like no one else so that later you can drive like no one else. So yeah, if you need to go without the AC for a little while to get your goals hit, fine. I've done that, too.

Act like it's a convertible.

The kids will never know. But it's not like this is somehow better. They don't build like they used to. Thank God, they were a piece of crap. Thank God, they're better now. But check all that out. But do the minimal and get the inspection, get the car run, keep your family going, get your car paid off, then save up and buy up in car, save up and buy up in car and save up and buy up in car. As you build wealth, move into better and better cars. Never again a car payment and never again a new car until you have at least a million dollar net worth. There's some good rules for you guys, okay? For you, Diana, as well. Thank you for calling. We appreciate I appreciate you joining us. Open phones at 888-825-5225. Here's the numbers. A new car loses, according to Kelly Blue Book and according to Yahoo Finance and about three other sources, a new car loses 60% of its value in the first five years. So that means if you buy a $40,000 car, when you drive it off the lot and you hear that sound going over the curb, when you went into the street, that sound was $10,000.

That's the first drop. As soon as you get it, as soon as it's titled to an individual and it touches the street, it's going to drop 20, 25% that day. Then from there, you're going to lose the rest of that 60%. So $40,000, that means you're going to lose $24,000. That means your $40,000 car in five years is going to be a $16,000 car. And that's a new car. Now, if you lose $24,000 every five years, don't be scratching your head and wondering why you're not, don't have wealth. It's because you're driving it down the sewer. You're causing this. And so you can afford to take that hit if you got a million dollars. You can't afford to take that hit if you're broke. This is the Ramsey Show. Ken Coleman, Ramsey personality, is my co-host. Thomas is in Jacksonville, Florida. Hey, Thomas, how are you? Hey, Dave, how are you? Better than I deserve. What's up?

I've been following you for quite a while, and me and my wife have been treating debt like it's cancer. We've been living frugally, and I'm left with about 15 to 20 credit cards that are completely paid off. We can't decide what to with them because our credit score is so good, we can't decide whether we want to close them or just hold on to them.

Okay, I'm confused. I thought you said you were following us. I am following you. And that you said you hated debt. Is that the same guy? Yes, sir. Okay, so if you hate debt, why do you need a credit score?

And that's where I'm at. But this is where the contention comes from. I don't think my wife's quite where I'm at as far as-So she doesn't hate She wants more debt. It feels like that, yes, sir.

Okay. Well, that's a different issue.

Sometimes it feels that way, yes, sir.

If you want debt, you do need a credit score. If you want to go into debt, credit score is a good thing.

Yes, sir.

But it's the antithesis of building wealth because your most powerful wealth building tool is your income. When you give all your income to other people because you stay in debt all the time, then you're going to be broke your whole life and build other people tall buildings, not your own. Yes, sir. Our goal here is to get you out of debt so that you can become wealthy. The only way a credit score is built, it's 100% based on how you interface with debt. It for the purpose of getting in debt. The way you get a good score is get in debt so that later you can get into more debt so that you run your score up so you can get into more debt so that you run your score up so you can get into more debt. That's the essence of the FICO score. We worship at the the great FICO. We bring him offerings of interest and say, Oh, great FICO, thank you for being my provider and letting me buy crap I can't afford with money I don't have to impress people I don't really like. That's the whole purpose of FICO.

If you want- It's like a It's a traditional curse, almost.

Yeah, it is. It's exactly what it is. It's designed to prosper the bank. It's not designed to prosper you. But people get caught up in this false measure of success. It's not a real measure of success. That's what you guys have to decide at your house. Then once you decide that, it's an easy fix. You just close the accounts and chop up the stupid cards, have a plastic surgery.

Now, do you recommend keeping any credit cards?

I don't have any. I haven't had. My credit score is indeterminable, known as zero.

Wow.

Just like the interest I pay, zero.

It's almost hard to imagine because I've spent the past 10 years building my credit, focusing on…

I've always been-I know. Once you belong to the FICO cult, it's hard to get out because they brainwash you. What you have to actually do is intellectually decide, is this a measure of success? My contention is it is not a measure of success. That networth and income are measures of financial success. Not a score that says I've borrowed money a lot.

Right. And made them- I told my wife today, I said, I'll be a millionaire by the time I'm 35. No, you won't. By the time I retire, I'll have a million dollars.

No, you won't. You're not going to. Not unless you fix this problem.

I'm going to cut those credit cards up today and call those companies and close the accounts.

You better be on board with your spouse in doing this. I'm not trying to cause a divorce here. Okay? The two of you need to sit down and talk about where you want to be. But if that's how you're going to live, you are going to be a millionaire because that's the secret. I mean, it's not a secret. It's that you keep your money and invest it instead of giving it to Ford, motor company, and MasterCard, and Amazon freaking prime, and everybody else is profiting off your butt. All you do is work for other people and give your money to them all your life. That is the essence of debt. When you quit doing that, it's magical how much money you have.

It reminds me of one of my favorite lines from a movie, Forrest Whitaker is the actor. It's called The Great Debater. It's about a true story. At some point in the movie, his son, who's all in the debate, he's a great student, but he's spending all of his time in debate club, and he's letting his studies start to slip, and his dad's getting on him, and he runs out with an attitude, and his father follows you out on the porch and Forest Whitaker says, Son, do what you have to do, then you get to do what you want to do. That's the essence of the matrix that everybody's in because see, credit cards say, Do what you want to do. But wealthy people, they've already figured it out, and they go, I'm going to do what I have to do so that later I can do what I want to do. This applies to money. If I have to wait to save up to buy something, if I have to wait to do the vacation I want to, if I have to wait to pay off my debt, my student loan. The idea here is that there is a difference.

There's two very clear paths. One is the path to average, and the other is the path to excellence. Really wealthy people, it's a much smaller path, and they figure that self-delayed. They can delay gratification. They can figure out discipline because they got their eye on the prize. They're thinking 30 years from now, that's what they're thinking. You got to pull yourself out of the matrix.

But I don't want to wait 30 years to live my life. Well, it's not going to be 30 years, duber. I mean, it's going to be 30 months for you to be debt-free and start to have an emergency fund and start to get control. It doesn't take that long. But yeah, after 30 years, you're going to have millions. To be really wealthy, yeah. You have to have that long view. If you live like no one else, later, you'll get to live like no one else. Zig Zigler and the great motivators used to say, If you want the things that other people don't have, you have to do the things that other people won't do. Yes. And so decide. What What does it look like? What does your life look like to be different than average? Because average is broke with a car payment and a student loan that's been around so long, you think it's a pet. Average is credit cards are necessary. I'm going to get rich on airline miles, the dumbest but statement I've ever heard in my life. I'm going to make my money on discover points. Let's do the calculation on that one, okay, shall we?

You run $100,000 on your discover card. They give you 1% back. That's $1,000. In what school of thought does turning $100,000 into $1,000 cause you to be wealthy? What logic is in... I mean, how much drugs did your parents have to do for you to believe that turning $100,000 into $1,000 is a path to wealth? I mean, the '70s were good to your folks. I'm just saying. Oh, Oh, my God. Wow. I mean, that's about as dumb as a rock right there. But people, they look at me straight in the face with this sincere thing that this is a methodology for building wealth. I'm going to take 100 grand turned into one grand, and that's wealthy. That's just dumber than... It's hard to get my head around. But these are the mythology that average normal people believe. It's the matrix, yeah. For God's sakes, don't challenge It's their little myth because they get all pissed off if you challenge their falsehood that they're living right square in the middle of them believing. They get all TikTok on you then, man, and just turn you into a meme. I'm just saying I know a guy that happens to do stuff.

Oh, man. It really is funny, though, the cultural, you got to have the credit score. You heard it right out of his mouth. By the way, there's nothing wrong with him. He's literally repeating what 9 out of 10 people repeat, which is I got to have the credit score to actually be a functioning human being.

What do we got? Just under 400 million people in America, roughly now, right? I think that's right. It's 26 million millionaires. 26 million millionaires out of 400. What is that?

Well, what is it? 5%? A little over 5?

Right around 5%. That means that if you are doing the things that we're talking about, you're in the top 5% of people in America. Then there's the rest of you.

That's right.

That are just going to keep doing the stupid butt stuff over and over and over again until somebody gels at you enough that you'll get your attention. It's like, Oh, I have my plan. Good luck with that. Look at how it's working for you. You $1,200 car lease. Dumber than a rock. This is a Ramsey show.

Listen, your grad just spent roughly 4,320 hours in class, and we're guessing that nobody taught them how to win with money. But you can still set them up to win with gifts like the Total Money Makeover, Breaking Free from Broke, or Ken Coleman's Find the Work You're Wired to Do, which includes the GetClear Career Assessment. And listen, these gifts could change the trajectory of their lives. And if it helps them earn, spend, save, or invest money the right way, you'll find it at ramsey solutions.

Com/store.

That's ramsey solutions.

Com/store. Ken Coleman, Ramsey. Personality is my co-host. Perfect question of the day for you with your frustrated sports announcement voice.

I solved this.

I'm a little excited. Today's question comes from Nathan in Michigan.

By the way, I should point out that Nathan is from the state that has the National Championship, undefeated Michigan Wolverine football team. Just want to point that out.

Just like you're trying to say go blue is what you're trying to do.

I really am trying to get away with it. All right, here's the question from Nathan. What is your opinion on the recent changes allowing college athletes to profit from their name, image, and likeness for sports fans? You know this as N-I-L for non-sports fans. When you hear that. We'll explain that in a second. Do you believe this is a positive development for college athletics, providing athletes with more opportunities, or do you have concerns about potential implications for the integrity of collegiate sports? Well, let me address that first. The irony is that NIL has actually probably brought more integrity to collegiate sports because now it's removed all of the edges and all the cheating that's involved with recruiting, which would have been always cash to families or cash to athletes. Since the adoption of where college athletes can be paid for their name, their image, and likeness.

I may correct you. It wasn't an adoption. It was a court mandated. Yeah, but I'm just saying- Supreme Court said they had to. That's right.

Now that is the law of the land. What that has done has really removed a lot of the cheating and the backroom deals where you saw boosters causing a lot of problems. On the other issue, what is my opinion of it? I'm not a fan of it. I certainly understood that there was a case to be made that colleges and their athletic departments were profiting mightily from these athletes. But what has happened is I think it swung too far the other way, and that with the transfer rules has now made it free agency. College sports mirrors professional sports, but in fact, it's even crazier. It's the Wild Wild West. There are no contracts. An NBA or an NFL free agent is under contract for X amount of time. The team and the athlete and the agent all know that the contract is coming up. In college sports now, kids can just simply declare via the transfer portal and That's how they hurt my feelings. That's right. And then they leave. I think we're in the Wild Wild West of the early days. I think this will continue to morph. But to answer the question, I'm not a fan of NIL.

I think it's just made the sport a little bit wackier, and I think it's made prima donas out of high school kids who, by the way, are showing up at signings for their college in Lamborghini's, University of Alabama. That happened this year. Kids showed up at his high school, Dave, to declare he was going to Alabama and he was driving a brand new Lamborghini.

That can't be good. There is something wrong with this picture, ladies and gentlemen. I knew that would load you up.

This is the equivalent of me putting a golf ball on a large brush tea so that you can hit it right down the middle, Dave.Thank you. What say you, sir?

I agree with you that the kids, they were due something, but the court ruling completely took it out of the hands of the colleges to develop something because the college has screwed up. I mean, if they had come forward, if the NCAA had come forward and put together a plan where the kids could make some money and managed it and adopted that, then it never would have gone to the Supreme Court. But the Supreme Court just kicked the door completely open. There's absolutely no rules. Like you said, Wild West, it's chaos. The problem is several fold then. I don't mind anybody profiting off of their efforts. Regardless, that's called a meritocracy, and I'm a big fan of meritocracies. I believe if you work hard, you should get something for that. If you have talent, you should get something for that. I'm fine with all of that. The problem is with it being completely out of control. I've had athletic departments call me and say, Hey, would you come speak to the team? I'm like, Sure. What about? Well, we've got a quarterback that makes two million a year, and the guy blocking for him makes nothing.

How do we build teamwork in that? I'm like, I can't help you with that one. Good luck. That's like known as can't be done. You need to restructure the whole thing, but they don't have that option because the court took it away from them. You can't structure it. You'd get sued again. If you said, Okay, we You got to put some of this money in a pool and the whole team benefit so we can build a team character. Then you add to it the portal, which every time you piss somebody off, they just hit the road. If you want to piss somebody off, piss off a highly aggressive 18-year-old who you are training to run over other people and then piss them off. Be surprised that they're pissed off because what you do all day long is teach them how to run over other people. Then guess what? As soon as you hurt their little feelings, they're gone. It's very difficult to build a college team now in this environment. It's very difficult because the kids, there's this disparity of income. Then the last problem is the same problem we've been facing when you and I have been working with the NFL, and our team has been working with the NFL for years, going to these rookie camps, and we tell these young guys, You just got a $10 million signing bonus.

I understand, but $10 million is not enough to buy everyone in your entire family a $2 million house. That's not $10 million. That's $100 million, and you did not get $100 million. Besides that, you're in the NFL, which stands for not for long. 3.2 Two years is the average career. 88% leave the league permanently physically disabled in some manner. The divorce rate, 10X the public. This does not spell out well for wealth building. Let me tell you what happens to your 10 million. It's gone. That's been that situation. That's what happens to it. It's gone. You don't have it. But you got Bling, and you got a lot of friends right now that aren't really friends, and you're taking them to the Bahamas and go swimming. Well, good for you. That's dumber than crap. This is me talking to NFL people, and guess how far popular that is? It's not popular. Now it's worse because now you're dealing with a 16-year-old because the NILs drop down into high school now.

A hundred %. There are actually no limits now.

We're seeing it show up in high schools, and we're going to see it in junior highs. We're going to see nine-year-olds, 10-year start to get payment to lead them through because we worship these sports figures. It's just, guys, it's not good for the people. That kid that gets $10 million and doesn't manage it well, and it leads to horrible things in his life, it's not good for him. You know what it's done?

It's really killed amateur athletics because the very word amateur is now completely defunct. It's not. I mean, once you collect a check for doing something, you are by default a professional.

But it is pretty cool if you can show up for signing down a Lamborghini.

I don't judge the kid, but my goodness. Hey, there's a defensive Alabama in here who said it was actually it was Ole Miss, not Alabama. I don't know if that's true.

I don't think so.

We've got it pulled up here. It was an old miss player. All right, I have no problem being wrong because I was still using a great example. I apologize all you roll-tied people. You got to be careful.

You big blue people.

We beach in the Rose Bowl.

There's that.

It feels good to say. But anyway, the point is, you You got an old miss kid showing up.

Oh, that's a Kiffin kid. Yeah. Oh, that does make sense. Careful, Dave. That makes total sense now. Yeah. Okay.

That was a little close to home. Lane Kiffin left the ball, set the altar, folks. Dave's not over that yet.

No, I'm definitely over it.

Yeah, you got a good coach. But here's the deal. This has absolutely changed college athletics forever. Here's the other thing. You're going to see this begin to affect the non-revenue-generating sports.

If you like college- Here's the thing. When I was dealing with college coaches, and we're sitting down talking to college football coaches, and they say, Hey, it's not unusual at all for some of the young men on my team for me to be the first male figure in their life to lead them well and to love them well. Regardless of race, and he goes, It's not unusual at all for me to be that guy. And guess what? He's not anymore. He doesn't have that capability to love those kids well because they make more than he makes. They will leave as soon as he challenges some of their mythology that they're living their life based on, or their behaviors or whatever. Tries to make them sit on the bench. He told me, I have to sit on the bench.

Here's one other unintended As a consequence, it's driving some of the great legendary leaders out of the game. The last two years, Entree Leadership Summit, I think it's the best leadership event in the world. It's our signature event here at Ramsey Solutions, part of Entree Leadership. We've had on the stage, arguably, two of the top five coaches of all time, any sport, nick Saban in football, and Coach K just this last couple of weeks, and both of them left. They've told Dave and I, we were both around them. Nil was one of the reasons that drove them out of it. It's just changed the landscape.

The NIL and Porter together is just Both of them, yeah. It's not good. It's not good for the kids. It's not good for the sports. That's the summation of it. And yet I would never deny someone the right to earn money. There's nothing wrong with that at all. You just got to figure out some way that it's done in a wise way that's a blessing to everybody involved. 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, Ramsey personality, number one best-selling author is my co-host. The phone number is 888-825-5225. Denise is in Syracuse, Qs. Hi, Denise. Welcome to The Ramsey Show.

Hi, Mr. Ramsey and Mr. Coleman. It's nice to talk to both of you. Thank you so much for taking my call. Sure.

What's up?

Well, my question is, I guess I'll start there, do I keep putting or do I stop putting money into my 401k until my 401k is paid off along with my car and a six-month emergency fund? So Next month, I'll be 57, was a single mom, took care of the kids, all that. They've all got one's married, gave them $10,000 for a wedding, the other one got engaged, bought a house, gave them $10,000 I'm at 176,000 in my 401k, 25,000 in a rough.

How much other money do you have saved? My debt. Not counting in return.

Well, here's the thing. That's I don't even know what baby step I'm in. I paid my house off already.

Good for you. How much money do you have saved other than your retirement?

A thousand dollars. Okay. All right.

You're a little bit I'm just convobulated, but I think you've done a good job overall. We can just work on a little bit of smoothing the wrinkles out, if that's okay. Oh, my God, yeah. Baby Step one is $1,000 saved. Two is don't do anything until you clear all of your personal debt. Now, you have personal debt that's a car and a 401k loan. Did I hear that right?

That's right. My 401k loan, they take out 800 a month.

What's the balance? In July- What's the balance?

27,000. Okay. 27,000.

What's owed on your car?

$6,200. Good.

What do you make?

I can have that paid off at the end of June. What do you make? I bring home about 6,500 take home a a month, but I also have an Airbnb in my house. I can average, like May and June, already booked, and I'm getting $1,000 extra for each month. That's how I'm paying the car off and stuff.

That is the right goal. We're going to list your two debts, smallest to largest.

We're going to pay-I do have a credit card.

Balance on that is what? $1,800. Okay, let's pay that off before you do anything. That's your first thing, and cut it up. Credit card. Okay. Then we're going to stop your investing temporarily into your 401k. The word is temporary because you're going to knock these debts out fast. We're going to get you on our every dollar Budget, which is the budgeting app, I'm going to give it to you as my gift. Okay? Oh my God. Then I want you to lay out every dollar having a name. You are doing this because you've got a game plan. It's just rumbling around in your brain instead of down on paper, okay? If you put it down on paper, it gets much more efficient, meaning into the app, okay? We're going to put it into the app and make every dollar behave, stop all of anything going on and point all your guns, every dollar you can squeeze out of your whole life at these debts. First the 1,800, then the 6,200. Those will both be gone by August for sure. Then we're going to tear into that 27,000. Now, you're not allowed to pay extra on a 401k loan.

They only withdraw or you can pay it off in a lump sum. What you've got to do is just pretend like you're paying it off and put the money into a savings account.

No, I actually called them. I called them and yes, I can make extra payments. I can pay it off in full. I can make extra payments.

Very unusual to the point. I'm not sure that's right. But if you can, that's great. I don't care. We're going to chunk money at it after these other two are gone until it's gone. Basically, what we're saying is we've got $35,000. We're going to clear up pretty quick here. Like by spring, you're going to have no debt.

That is correct. I'm hoping by February or March.

There you go. So you've already run the numbers out. You're doing the same thing I'm doing. Good. Now, when you're 100% debt-free, house and everything. Yeah, that puts you at Baby Step 7, except that you don't have your emergency fund at that point. So you need to go back to your $1,000 account then and raise it up to three to six months of expenses. So we'll It does make up a number right now. Let's call it $15,000. That money is sitting there just between you and life. You never touch it for anything unless life comes and knocks you over. It's not a wedding fund. It's not a I need a car fund. It's not a vacation fund. It's only for emergencies. Everything else you save for separate from this fund. So you get that emergency fund in place, then we restart the 401k. And you're going to do that by about this time next year, roughly.

After that, then start investing. Yeah.

And you'll be able to easily invest because guess what? You don't even have a house payment. Yes. I mean, you can load that 401k up. You're going to be so rich. It's going to be unbelievable.

But can I be? I'm 57 and starting so late with 176 in my 401k and 25?

What did you say you made?

I average right about 6,500 a month.

Okay, that's take home. That's take home, yeah. You're making $80, $85, $1,000 a year, right? Yeah. Okay. Yes. If you invest $10,000 a year, $15,000 a year, which you should be able to do pretty easy. Right. You're going to have a lot of money. The 176 will double every seven years. Have you got it in good mutual funds?

I have it through work.

I know, but is it in mutual funds?

It's Vanguard. I don't know.

I know, but is it in good mutual funds? Vanguard has got bad mutual Mutual Funds, and Vanguard has good mutual funds, and Vanguard has all kinds of crap that you don't want it at. Vanguard is a fine company, but not every one of their instruments are good for you. You need to be in growth and income, aggressive growth and international, and growth. That's the four categories. I'm going to teach you every bit of this. I'm going to plug you into Financial Peace University and show you how to do every bit of this. But if you've got it in good mutual funds, if it's averaging 10%, it's going to double about every seven years. When you are 64 years old, you are going to have 400,000. You're going to have $550,000. We'll count the $15,000 we're putting in over the next seven years. You're going to be a millionaire when you're 70. I think you're okay. I think you're going to make it.

We don't know how much your house is worth.

Not counting your house. Not counting your house. You're going to have... You should have a million dollars in your mutual funds by the time you're 70 with what we're talking about here. That's 13 years. So it'll double and you're going to be adding to it all that time. You're never borrowing money again for anything ever. You're paying cash for everything for the rest of your whole freaking life. You did it. You're going to be a millionaire single mom. Isn't that neat? I think that's pretty neat. Hang on. We're going to sign you up for every dollar and sign you up for Financial Peace University and give it all to you just to say thank you for being a new listener. Then we can get your baby steps discombobulated. Because they're convobulated right now, so they need to be discombobulated. That's how that works, right?

I'm going to write that down and remember that.

That's a classic bad joke right there. This is The Ramsey Show. Hey, guys.

Are you ready for The Secret to help you reach those money goals that you've been dreaming about?

It's simple. You got to get on a budget. With our budgeting app, Every Dollar, you'll get intentional with your money and build the habits that will make those dreams a reality. And we'll be with you every step of the way. From your first budget to that retirement home on the beach, download every dollar for free on the App Store or Google Play. Remember, today, download every dollar for free on the App Store or Google Play today. Ken Coleman-Ramsey personality is my co-host today, and number one best-selling author of the book Paycheck to Purchase. Purchase? Purchase, yeah.

We'd like you to purchase it. It would be great for my purpose.

You can probably purchase something if you had a paycheck. Like that book, maybe. There you go. The best way to make most of your money is by creating and sticking to a plan. It's called a monthly budget. The dreaded B-word. Yeah. Why do people dread it? Because you get to tell your money what to do. If you don't like it, it's your fault. You get to decide what it says. If you hate it, why would you design a plan you hate? Design a plan you love? I can't have any fun. Well, that's your fault. You decided not to have any fun. You could do that, but that's okay. You could live like no one else so that later you could live like no one else. You could keep a pulse on your spending, make progress, work with your spouse, make your money behave. This is why millions and millions and millions, that's a lot of millions, are now using EveryDollars. It is one of the world's largest budgeting apps, but it's definitely the best budgeting app out there, and it's ours. We love it. Download EveryDollars for free at the App Store or Google Play today or at everydollars.

Com. Everydollars premium, you pay a little for, and it connects you to your bank and does all kinds of goodies, like set up your networth. It'll get you going on the whole thing. Track you through your baby steps right there. Oh, yeah, baby. It does all of that. Check it out. Tracy is with us in Canada. Hi, Tracy. Welcome to The Ramsey Show.

Hi. Hey, what's up? Thanks for taking my call. I'm super excited to be on.

We're glad to have you. How can we help?

Thank you. So we recently, well, about a year and a half ago, we bought a house and we were slowly, we were living in it and slowly renovating it and using it to be also an int, like we were planning on selling it in a couple of years once we were done renovating it. And then in the middle of renovating it, we found out we had asbestos and all the drywall. And so we quickly moved out and we're living with my father-in-law, and we're trying to renovate it now super fast, but definitely incurring a ton of debt on our home equity line of credit.

Because you're using asbestos removal companies.

Yeah, we have it all. All the asbestos has been removed, and we're just now in the the building phase.

Yeah, you're down to the studs on the whole stinking house.

Yeah, totally.

So now we're drywall up. Wow. How much money are you going to lose on this when you're done?

Well, we've had a real come out, and she gave us the number, and I mean, I don't know. It's an acreage, so it's a little trickier than a home in town.

I wasn't what I asked. I asked what you're going to be able to sell this mess for when you get it completed.

I'm hoping 1.1. Okay.

How much will you have in it at that point?

Probably 350.

You're going to make some money.

Yeah, we might.

Well, I mean, 1.1 over 350, you're going to have to screw it up bad to not make some money.

Yeah.

Well, let's get it done and get it sold. What's the question?

I feel terrible about going into debt and using our line of credit to do it. Good.

So get done and get out of it.

We got it a couple of years ago.

Get it done and get out of it. This dream has turned into a nightmare, but you're going to end up with this fertilizer is going to grow some stuff. You stepped in a big pile of poop, right? Yeah. But No, you're going to get out of it with growing some stuff.

Yeah. $3.50 is what we're putting into it, out of pocket into the house as a renovation cost.

Okay, you're not answering my question then. What'd you pay for How much is the house?

535.

Plus $3.50. Yes.

I ask how much you're going to have in it. You're going to have eight something in it, not 350. Yes. Okay, so you're barely going to get out by the skin of your Good. At least you're going to get out.

Yeah.

Okay. It's not as sweet as I thought it was a minute ago. I was confused, but you confused me. So there we go. But okay. Yeah. All right.

We also have a rental property that we own, and I'm just curious if it would be wise to sell that and use that to not have debt, I guess.

Yeah, I would love that. Sure.

Yeah.

Sure. Because here at the end of the story, you're going to have the money from that rental back in your hand, right?

Yeah.

If you don't run up dead, instead use the rental money. So yeah, sell it. That gets you out of this poopy mess again. Then, lesson learned that All renovations are not quaint and fun and cute. As a matter of fact, most of them aren't. They suck. I've done a bunch of them, and they ain't no fun. I'd rather build a house any day from the ground up than I would try to renovate an old piece of crap. Man, it's awful. It's just awful. I was doing one over in one of the areas of town that's now cool. The cool ends. It used to be the hood, now it's cool. You know what I'm talking about? That thing, man, every time we opened up a wall, there was a whole nother problem. Money pit, huh? It's like, yeah. I mean, it's just like, God, man, they don't build them like they used to. Thank God. It was awful. I have no romance for historic renovations. I call them hysteric renovations. They're hysterical anymore after you do it. I did enough of them, The cute little- You're telling me you don't like to watch fixer upper shows on HGTV?

Oh, that's just not even close to what really happens. Reality TV has so little reality in it that it is so scary. But yeah, no, I don't watch any of that. I don't even watch TV. But still, it's just the cute little, Oh, it's cute. Yeah, it's cute. You have no idea. No, thank you. No, thank you. A little PTSD, folks. Yeah, I did. She's coming out right now on her behalf. It's a Empathy, empathy, fit. You can absolutely feel having a sympathy, empathy fit right now for her with her asbestos discovery. Back when we used to kill ourselves trying to stay warm. That was insulation is what they're dealing with Okay. Liz is in Columbus, Ohio. Hi, Liz. How are you?

Hi. I'm so excited to talk to you guys. Thank you so much for taking my call.

Sure. What's up?

My husband and I are in Baby Step 2, and the next loan that we're chunking away at is my car loan. In the month of May, we're going to be able to make a $7,000 payment on it. I'm just wondering if I should stockpile the remaining balance of the loan, including that $7,000, Why? Because I went and looked at the loan, and if I paid off in one payment, they reduce it by $2,000. I was confused by that, and I just wanted to call in and see if you guys had any insight there.

Give us a few more details.

That doesn't make sense. What's the interest rate on this loan?

I called and asked, and they didn't give me a rate that they said it's earning $3.22 in interest a day, which is so painful and horrible.

They would not give you the interest rate?

Yeah, but they told me how much it was earning a day.

No, but why won't they give you the interest rate? Because they're screwing you. That's why. 100% You got a very high interest rate because you have a bad contract called Rule of 72s. Yeah, that thing is nasty bad or 78 or whatever it is. It's got a prepayment penalty in it. Yeah. That's what it's got. What you're probably better off doing, and you're going to have to dig into this and learn some more about it, but I think you need to pay it down to the last little bit and then take one hit on it because the prepayment penalty is calculated on the outstanding balance. So reduce the Now it's down to about 2,000 and then do 2,000 all at once. I think they're telling you exactly backwards of what you need to do, but that doesn't surprise me because they're screwing you.

Yeah. Okay, cool. That makes a lot of sense.

I'm pretty sure you had bad credit and bought a car you couldn't afford, and they jacked the rate on you. Does that sound right?

Yeah, it was like a car lease when I was in college. It was a horrible decision, but I'm just cleaning it up and just moving on. But yeah.

Get her done. Get her done and get it knocked out as fast as you as we can. Yeah, Lump Summit. I mean, throw as much at it as fast as you can, but you need to dig into it. You might want to just do one little lump at the end. Instead of $500, make it $2,000. I think that might be the to trick the math on the thing. But look into it and figure it out. They'll walk you through it once they figure out they're not able to screw you anymore. This is The Ramsey Show. Hey, folks, our brand new event, Dave Ramsey's Investing Essentials, is almost here. Do not miss this chance to get the tools you need to build your investing plan and prepare for your dream retirement with confidence. It's happening May 21st and 22nd, and it's virtual, so you can tune in from anywhere. You can even submit your questions to get real answers in real-time. Tickets are $1.99. Get yours at ramsey solutions. Com/events. Ken Coleman, Ramsey personality is my co-host today in the lobby of Ramsey Solutions on the Debt Free Stage. Ryan and Courtney are with us. Hey, guys.

How are you? Good. Good. Where do you all live? Northeast of Champaign, Illinois. Oh, fun. Welcome to Nashville. Good to have How much debt have you guys paid?

$133,000.

Wow. How long did that take? About 35 months. Good for you. And your range of income during that time?

We started around $1.15, and we've ended about $170.

Excellent job. Very good Guys, love it, love it, love it. What debt was the $133?

One credit card, one truck, and our mortgage.

No. No mortgage. Looking at weirdos. Yes. Weird people have paid for houses. That's so weird. I love Excellent job. What's this house worth?

We just had it appraised a couple of weeks ago.

It appraised at 420,000. Love it. How much in your nest egg is in your 401ks in retirement? Well, we both have pensions. I work for the state of Illinois.

He works for the county that we live in. Then we have around 60,000 in Roth IRAs, and then we have around 40 in 529s.

Excellent. So you're over half a million net worth. Way to go. Yes. Congratulations, you all. Yeah. All right, tell us the story. What happened 35 Five months ago, three years ago, something changed.

Well, my husband is a Sheriff's Deputy, and he has many other talents as well. I had always hoped that he would just do 20 years and get his pension and move on to something different. He always said, Well, I can't draw my pension until I'm 50, so I'm going to work until I'm 50. But law enforcement got a little crazy in 2020.

Heard the rumor. Yeah.

One day, he called me on my way to work He just said, I'm done. I don't want to do this anymore.

I'm going to do 20 years, and I'm going to be done.

My first thought was, I'm so glad that he finally came to his census. But at the same time, oh, crap, how do I tell him if we owe money on a truck and a credit card, he's not going to be able to do that. That day, I just decided I'm going to make it so that he doesn't have any excuses. When that date gets there, he can retire. He can retire with dignity, and he can do whatever whatever he wants to do.

You just said, We're going to get out of debt then?

I did, and he was initially not on board.

It took a couple of days and some tears, but I got him there. Okay, all right. How did you connect up with all this Ramsey stuff.

I actually found it through the Minimal Mom, Dawn.

I was watching a video of hers, and she was talking about the debt-free screams.

I have about a 30-minute commute to work, and so I pulled them up on my way home and listened to them.

I finished up the next morning, and I sent the link to him, and he called me and said, Is this a joke? I was like, No, we can do this.

Why not? I sat down that day when I got to work and just immediately wrote everything down in a little red book that I still keep all my information in. We did a budget about 6:00 AM a couple of days later. I said, We're going to do this before the kids are up and it's quiet. We didn't have any battles. Took us about an hour. We got everything together, and we just stuck to the plan. Wow.

Yes. Well, we were in agreement, we need to do this and game on. Yes. Then here you sit 35 months later. Now, did you hit your 20th year? September of this year. Coming up fast. Yes, it is. Oh, wow. Okay.

What was the reason for the bump in income? It was a pretty nice little bump here.

He got a really good raise last year.

The county gave them their wages.

About a 25% raise.

Then I got raises along the way, too. Also, I'm a court reporter, I teach court reporting online, so that was an extra job that I picked up.

For about three years, we owned a small business that we just sold in December.

We were both working, and he also does IT on the side. Like I said, he's very talented. We had a lot of streams of income coming in.

That's awesome. They jacked your income up. They're trying to retain the officers. Yes, they are. It's still hard to do.

Do they know that you're out?

They have a general idea, yes. I have not given any paperwork on it. I need another job. But if they happen to be watching YouTube, I'm just saying. The cat is out of the bag. Way to go, guys. How does it feel to not have a payment in the world? Not a house or anything. It feels awesome. It is a great feeling. Just free. How old are you?

Go ahead.

I'm 39. I'm 45. Okay, very good. Very good. You're free? Yes, we are. Already a half million dollar net worth, and you're going to be millionaires in no time. Way to go, you guys.

Ryan is actually He's currently recovering from a neck surgery that he had to have back in March. He's on temporary disability through the Department for that. We told our kids on the way here that if our circumstances financially had been different, it would really be a struggle. But now it's just an inconvenience. It's not the end of the world.

Yeah. Amen. Well, congratulations, guys. Who was cheering you guys along? Anybody?

Not really.

I mean, our parents knew that we were doing it, and our kids knew that we were doing it.

They were not happy about the grocery budget, but we got through it. Yeah.

It's rough in the law enforcement community. They're against this thing, being debt-free.

Why do you think debt is?

I'm not sure. Everyone wants the best-looking truck and the best-looking house, and they don't care what it takes. But here you are, completely free. Yes, definitely. Way to go, guys. Way to go. What do you tell people the secret to getting out of debt is?

I think being on the same page and just coming up with a plan and just sticking to it no matter what. You can't make excuses. You just got to stick to it.

At times, it's hard, but it's the ultimate goal that you're going for. What do you think the hardest thing was?

For me, it was paying off the mortgage because no matter, it seemed like we were throwing so much money at it, and I would call every few months and say, What's the balance? They would tell me, and I'd be like, That's still so much money. But then I got to the point where I started thinking of it like, Well, some people owe that on car. Also, like Dr. John Deloney says, you start looking at that new front number. When it got below 100, I was like, Okay, now we're getting somewhere.

Yeah, now we can feel it. Now the momentum is coming. Then I would always text him like, This is the new balance.

These are the payments we made. This is what the balance is. Just cheering each other along, too.

You got to see that progress. You got to feel something. If you feel stuck, you quit. Yes. Way to go, you guys. Very proud of you. All right, bring the kiddos up. What What are their names and ages? Briley is 15. She gets her driver's license at the end of the month. All right, Briley.

Ace and Wyatt are twins, and they're 11.

All right. Very fun. Very cool. Well, good to have you guys. We're so proud of you. A beautiful family. You're amazing. What you've done is inspiring. Now you're one of those debt-free screams. Or in a minute, you will be. Yes. Well done. We've got a couple of years of one-year subscription to every dollar premium. We'll give them to you in a few minutes, and you can use one, give one to a friend, and pass them along. Who knows? You might even convert one of those law enforcement guys. You never know. I hope so. We're hoping. I love it. Well done. All right, Ryan and Courtney, Briley, Ace, and Wyatt from Champaign, Illinois. $133,000 paid off house and everything, 35 months, making 115 to 170. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free. Yeah. Love it. Way to go, you guys. Congratulations. Very, very well done. There's something I I think sometimes the career piece, that's why what you do with careers makes so much difference. The career piece, when it gets tied up and something comes along and shakes you in your career, and certainly that happened to a lot of different people around pandemic time, but law enforcement has faced a whole different set of issues.

You go, Wait a minute. No. Then you got to go, Okay, what's got to be true? She said, What's got to be true is we got to get out of debt. Then you go, Okay, how are we going to do that? Well, now we're going to... Here we go with the Ramsey stuff. Those crazy Ramsey people suddenly start sounding sane. Then you watch about 100 debt-free screams, and then you go, I want to be one of those when I grow up. Then 35 months later, not even three years later, house and everything is gone from the moment of being shook to there.

For a lot of people listening that are feeling stuck professionally, the key to getting out many times is getting free financially. In this case, this is Exhibit A. If I get financial margin where I can actually breathe and move and actually get qualified to do something. Sometimes it's getting your financial house in order that will allow you to actually make that pivot. This is a classic example. Thank you for your service by the way. You're a great American and excited about your future, my friend.

Amen. Very cool. This is The Ramsey Show. Our scripture of the day, Proverbs 16:32, Better to be patient than powerful. Better to have self control than to conquer a city. Albert Einstein said, We cannot solve our problems with the same thinking we used when we created them. Thanks for being here, America. Dalton is with us in Austin, Texas. Hey, Dalton, welcome to the Ramsey Show.

Hi, Dave. How's it going?

Better than I deserve. How can I help?

Well, I'm self-employed, and I was doing really good financially. I had gotten debt-free almost besides the mortgage. Then I got six-figure income one year, and I got… I lost my humbleness, and I got into a lot of debt. Now I can't even hardly feed my family, just trying to make the minimum payments.

What debt have you got?

We have 220 in mortgage, 36 in car, 18,5 in American Express business credit card, 16,5 in a trailer that I use for work, and about 10,000 on a personal loan, about 6,000 on several other credit cards that are personal debt, and about 5,000 in truck repair, like a high interest on-site loan that they give you there.

What are you making?

So my income is varied week to week. It's between 1,100 and 4,500 a week.

What are you making? What are you going to make this year in total dollars? Net profit, taxable income.

I switched fields. So this is going to be my first year in this field.

Why did you switch fields? You were making $100,000 a year.

Because it completely dried up. And I built a house.

What were you doing?

I was in construction. I had a construction company, and I had lended a house, and I had built a house. Then right after that house, I took on all this debt.

I'm sorry, construction in Austin, Texas dried up? No, it didn't.

For me, yeah. No, it didn't.

Why did it dry up for you?

I just stopped getting calls.

It's a boomtown. I was getting calls left and right. Well, I mean, did you do? Did you not build well or did you not do the work good or what?

I think what happened was while I was building this house, I wasn't available to all my other customers.

You built yourself a house and you quit working?

No, I built it for a customer, but it was for one customer.

You got overextended?

Yeah. For that three months, I was only focused on that one customer.

Before that, you were doing just repairs, handyman stuff?

Yes, sir.

Now What have you switched to now?

Now, I'm driving truck hauling Rock. I took out for my retirement, and I bought the truck outright, so I own the truck.

How old are you?

32. Okay.

All right. Well, okay. You're saying you're having trouble paying your bills is what you're asking. Okay.

What do you make and drive in the Rock truck?

1100 to 4500.

Okay, so that is the numbers. That's the numbers? Yes, sir. That's the new numbers? Yes, sir. Why is that fluctuating so much?

We're heavily dependent on the rain and other variables. Then some loads pay more than It's just really all over the place. The money is really good, better than I've made anywhere else, but it's not dependable.

All right, so let me ask you this silly question. This may be silly. Is that meaning that there are times where you have time on your hands because there's no rock to transport?

Not necessarily. Some of the loads that you have to take just don't pay very well.

But you're busy all the time. But the phones ring in You got stuff to haul all the time.

For the most part, yes, sir, except for the weekends.

Well, the weekends, you need to be working, my friend.

A lot. I still try to do handyman jobs on the weekends and construction job on the weekends.

There's no Try. I mean, in Austin, Texas, you were successful before. If you trace the story you just gave us, you were really crushing it when you were doing handyman jobs, smaller projects where you could be flexible and move and be a little bit more You could pivot, you could do that. You got all locked up in that house, and you had to ignore everybody, and that turned off the spicket of business, correct? Exactly. All right. I would go back to where I had success before, and I would learn something from this and go, I am a lot more nimble when I'm doing a bathroom here, a kitchen there, a fence, backyard fence there. I would be making money, and I'd be working like crazy. You need income, my friend.

The $36,000 car?

Yes, sir.

What is that?

I'm trying to get rid of it. I bought it for the company. After I built that house, I told my wife, I'm big time now, and I need a professional-looking car, professional a parking vehicle, and she told me that that was not smart.

She's a smart woman.

Yeah. He's very smart, and I should listen to her more.

Sell the car. What's the house worth?

The house is worth about 480. Can we owe 220?

Here's the solution. Here's your motivator. You want to get motivated? Here you go. You either get your butt in gear and get your income up to clean up this mess, or you're going to have to sell your house. One of the two.

Well, that was one of the questions that I had, too. This house is too small for our family because we have five kids, and this is a three-bedroom house. It's really a two-bedroom house that we made into a three-bedroom house. Would it be wise to just try and sell the house and get into something a little bit further out in the country?

If you go down in cost.

Yeah.

That's what I- You don't use this as… The way you set all that up, it sounded like you were going to go up.

No, we need to go up in space, but- But down in cost. Range, yeah.

If you go from a $500,000 house to a $300,000 house, you can free up some money to clean up this mess, yeah. And you sell this stupid car, yeah.

How do you do that with a family, though? I'm not sure how to sell the house and keep my… Because it's very hard to show a house when you have five kids running around.

No, it's not. They make their bed and you all get in the truck car and leave when the agent comes to show it. It's so true.

I did it with three kids and two dogs. I don't want to hear it.

You can do it. My house is being shown right now as we speak. The dog and the wife left. For the agent to come. That's how life works, dude. Yeah, you get your crap together. Because the family needs to get out of this mess. Now, more importantly, though, I don't want you to sell this house and feel like you straighten everything up because you still have this wandering mess of a career that you've got to get dialed in. I think you fell backward into this rock truck thing because you were scared, not because it was a plan. I don't think this is what What do you want to do 10 years from now. I don't think it's your career. I don't think you said, This is what I want to do. I want to drive a rock truck for the next 10 years. I think you just jumped into it because you heard you could make some money and you were so hungry and scared. You need to be rethinking about where you want to be with a business or with your career or both over the next 10 years? What are the steps to get to that?

That would be your Ken Coleman answer.

No, it's giving me assessment, the get clear assessment in this book, Find the Work You're Wired To Do. But he may need to at this point, Dave, consider going in to work for some contractor, and maybe if he can really pull some good money right now and then do stuff on the side. I'd be looking to upgrade that salary quickly with your skillset. I know this. This is a published fact. You can Google this and get 20 articles on this. There is a massive shortage right now for carpenters in America, and it pays a premium. If you can show up on time and not be on drugs or DUIs and Can actually sling a hammer and do it quickly, you can crush it as a carpenter. Now, that's a fact.

Yeah, and that's just one piece of the act.

That's just one piece. Yeah.

And so the same thing's true. I mean, we've got people in Entree leadership that are making 300 a year as handymen. Oh, yeah. Electricians and plumbers. Or a handyman. They just got a handyman service. That's all they do. That's right. And they just go in and do small jobs, small jobs, small jobs, and they bid them nice with a nice margin. Do stuff for rich people they don't want to do. Get you a leaf blower. Rich people are afraid of leaves. It's like It's the sound of prosperity. Right there, that's it. That stuff.

That's really good. I've never heard that. I'm stealing that one, too.

That puts this hour 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. Dr.

John Deloney here. Mental and emotional health challenges, broken relationships, it's all just part of life, but they don't have to define you. The Dr. John Deloney Show is here to help. It's a collar-driven podcast where you can get practical advice on dealing with anxiety, loneliness, depression, relationship challenges, your kids, and so much more. Listen to questions from our callers, or if you're walking through a tough situation and need some help, give me a call. You are never meant to do life alone, and that's what this podcast is all about. Follow along on Apple, Spotify, YouTube, or the Ramsey Network app.

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