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. Open phones here at Triple 8, 825, 5225, George Camel, Ramsey personality, host of the George Camel show on YouTube. That's Camel with a K, very popular show. As well as, of course, the Smart Money Happy Hour co-host with Rachel Cruz. He's my co-host today. Open phones here at Triple Eight, 825, 525. Kathy starts this hour off in Indianapolis. Hi, Kathy. Welcome to The Ramsey Show.

Hi, guys. How are.

You today? Better than we deserve. What's up in your world?

I'm trying to get there on your level. I am calling today to ask you guys what you think my next steps might be. I've gotten myself into quite the mess. I have followed all of the rules of never opening a credit card in my life. I'm 27 and I've made it this far without one. I've gotten to a point where I am desperate enough that I have been riding the line of wanting to open one this week because of all of my debt problems that I'm having.

Yeah, debt problems are always solved by more debt. What do you mean?

I've gotten myself into a predicament with bills that are owed and my shovel is not nearly big enough. And I feel like I'm running myself into the ground trying to do side hustles. And I just graduated in June and started as a hairstylist, and the money is just not there like I thought it was going to be. And I know you have to get clientele and build up your marketing and all that stuff. And after I signed my apartment lease, I found out that I was pregnant. So I'm six months into that journey now, and I have gotten off way more than I can chew as far as what I can afford.

Okay. What does your husband make?

I'm not married. Oh, okay.

Where is the father in the picture?

Financially, not. He is excited about the baby and all that good stuff, but financially not contributing at all.

Well, I guess I'll just start there. He really doesn't have that option, morally or legally. If you father a child in the United States of America, you get to pay child support. It's how that works. Sorry, bubba, you get to step up and participate in the financial side of the equation. Why? Does he not work or is he just a twarp?

I think it's more of a laziness problem if I'm speaking from my own. Okay.

From my own perspective. You have an apartment rent, you're not making any money. Are you behind on your apartment rent?

Yes.

How far?

At the moment, 15 days, and they're wanting to file eviction paperwork today.

After 15 days? Pretty hardcore.

Is your first time missing a payment?

Yes, it is. That's, I think, why I'm in panic mode.

You mean you've never been late and after 15 days, they're filing eviction?

Correct. Yeah. They said that that's just their policy, I guess. I don't really know how to fight that part.

Of it. It may take four months or something in Indianapolis. I don't know. That may be why they go ahead and get started. I don't know what the law is there, but you need to find that out, okay? Because fear of the unknown is more fearful than fear of the known. You need to find out what the law is in the area, how long it's going to take them to evict you, and what theWhat you can do to make that right. How much is your apartment rent?

It is 1,500 a month.

Okay. What are you making with hair?

Just with hair is probably about 1,200 a month.

Okay. What about other side hustles?

Side hustles included, I've been able to pull about 2,500.

Okay. You didn't pay your rent. What did you pay instead?

I have a car payment that I pay monthly.

How much is it?

It is 250.

Is it current? No, it is not. She didn't pay you it either. What did you pay?

I have paid my Wi-Fi bills, my electricity. All of my utilities are up to date.

But you made 3,700. Where did it go? I understand 500 of that maybe going towards those basic bills.

No, the total of all of my income is 2,500 a month.

Oh, okay, so you make 1,300 with the side hustles. Correct. Got it. That's still a big chunk of change that is unexplained.

Yes, and I think part of it is probably the trade-off with some of those side hustles. I've been doing a lot of things with my car. Here in the last 30 days is really when it has absolutely crashed. I think this is just a rough patch for me because I've been able to keep up. But here in the last 30 days, it's just been a disaster, and I've fallen behind in the last 30 days.

Okay, here's the thing. You have to find a way to make actual money net of expenses. Driving your car around with DoorDash and making no net profit on the door-dashing doesn't make sense, if that's what's happening after you pay your car expenses like gas, okay? So you might be better off doing something else. But 1,300 on side hustles tells me you're not working much.

I am not really sure how the money turnaround isn't working out. I am constantly working as far as the side hustles go, definitely. I know things have flipped as far as building my hair business and trying to get clients through the door with that. I've heard that this is a slow season for that anyway because I've been back to school.

How many hours are you cutting here?

I would say probably about 30 hours a week.

You're working about another 20 hours a week. You've got another 20 hours you need to be working a week. That's what I'm talking about. Okay. Except for the part that you're six months pregnant, which makes this very difficult. I do realize that. But we've got to change, like you mentioned, the shovel equation. Then the second equation we have to change the prioritization, okay? The first thing you buy is food. The second thing you buy is lights and water. The third thing you buy is rent. The fourth thing you buy is car payment. So you make enough right now to, I don't know what you're netting on that side hustle, but you make enough gross coming in to have been current with everything if you had it properly prioritized. Do you follow me? Yes. Okay, so what we've got to do in this crisis situation is we have to figure out where we can come up with $1500 the fastest from all sources and new sources. What we can sell and what you can go do from there. How old are you?

Twenty-seven.

Okay. Well, Kathy, it sounds like you're alone and pregnant and scared. You're putting on a pretty chipper face. But if I were in your shoes, I can imagine the terror I'd be feeling. So here's what we're going to do. I'm going to set up a Ramsey Coach to help you as my gift because I've been 27 and scared and I know how it feels. And tell Baba if he's going to make a baby, he gets to pay. That's how this crap works. This is The Ramsey Show.

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George Campbell, Ramsey personality is my co-host today. George, Sharon and I, I was going to say Rachel and I. Rachel was a baby. But Sharon and I learned the hard way, and then we later translated it to counseling, financial counseling, because we were working with people that were struggling when we first started this place. We still work with people that are struggling around this place. To go back to what we call an eighth-grade civics lesson. Now, they don't have civics in the eighth grade anymore, but they taught us the difference between needs and wants, necessities. The basic necessities of life are food, shelter, clothing, transportation, utilities. These are the basic necessities. If you find yourself in a pinch where you can't pay everything that is on the kitchen table piled up in the form of bills, you take care of the things in that order. Food, first. Shelter, second. Because if you've eaten and you have a place to sleep, you live to fight another day. If you're hungry, you don't have a place to sleep, you got all kinds of other issues here that have got nothing to do with Mastercard or student loans.

Food is first, shelter's second. Utilities are third. We've got a warm place to stay. Then we take care of transportation. By the way, probably don't need to buy any clothing. You probably got enough. You're probably like enough people. You got enough for seven people. You don't even wear half the stuff in your closet anyway, so you're okay on clothing. Shut up. You got the basic necessity. We call that building the four walls of a house, meaning that you take care of the necessities first before you do anything else, and then you will seldom get behind on those key things that cause financial stress to become sheer terror. Eviction, repossession, lights turned off, no food in the refrigerator turns financial stress into sheer terror. But most people, if they're able-bodied and can work, can take care of at least those basic things.

As long as you've got income. Then the question becomes, Well, Dave, what do I do when I've got all these debt payments to pay? Well, it's going.

To- That's the next step.

-going to go to collections.

Now, that's the next step. But you're going to be fed and dry and warm.

The collections people are aggressive. You got to tell them, Listen, I got.

Nothing to give you. They cannot make you hungry, though. Only you can choose to make you hungry if you're working and have an income. Only you can choose to make you homeless if you're working and have an income. Most people can earn enough to keep those four things going, if the worst of worst jobs. Even if you're working horrible $8 an hour or something and working 80 hours of that, you can keep the lights on, so to speak, the wolf away from the door. But now Mastercard may get all bent out. Well, so what? Didn't pay my student loans. Well, welcome to America. Nobody pays them, apparently. Oh, my God. Whatever, right? We'll get back to those things. I don't want to ignore them forever. But the first step to getting a sustainable thing is the four walls. That's what our last caller before the break needed to hear a month ago.

Yeah, it's a sad situation. You don't want to get to that point, but a good reminder and lesson for those out there.

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Today's question comes from Joseph in Ohio. Buckle up, Dave. Here we go. I'm looking into financing a boat to use like a house. Oh, my God. I know and understand your normal rules for buying a house. Ideally, 20% or more down, less than 25% of take on pay, 15-year fixed. I know and understand the normal thoughts on buying a boat as a toy, depreciating asset, cash only, value no more than 50% of yearly income when combined with all other depreciating assets. This guy really knows your stuff, or Dave. What I'm wondering is how out of line or not I would be if I combined those two into a houseboat if I adjusted the formulas and compensated for the discrepancies properly. The compensating factors I'm thinking about are buying something used with most of the depreciation already absorbed and financing with a higher down payment over a much shorter timeline. The boat will have some depreciation as opposed to a house, but if I compensate with extra savings, my thoughts are that this could work out similarly. As I know you would ask, I'm currently 100% debt-free and have a fully funded emergency fund. Okay, a lot to unpack there emotionally and financially.

But Joseph is saying, Should I buy a houseboat and can I do it with debt because I'm treating it like I'm getting a mortgage on a home?

Joseph, a boat is a trailer that floats. It goes down in value. You could buy a fully depreciated mobile home and make the same argument, but it would still be a dumb 10-year plan. I love boats. Son, in Ohio, that would be cold in the winter. Really freaking cold living on the lake. I can't imagine. I like the lake too, but I'm not living on the lake in the winter. Not in a boat. Oh, God, you freeze your butt off. It's going down in value. Here's the thing. Ten years from today, where do you end up? If you'll stretch these things out past Friday in your analysis, the answers start to become pretty apparent. When you buy a mobile home, you stretch it out 10 years, you take a $70,000 double wide. What's it worth in 10 years? Now, 20. What's it worth 10 years after that? Zip. You buy a car, what's it worth in 10 years? Going down in value. You buy a boat. What's it worth? Well, you buy an RV. You can do the same thing. I had people ask the same question about an RV. We always wanted to retire and travel the world in an RV.

Well, that's great. Pay cash for the freaking RV. It's a toy. Don't call it your house and justify a huge payment on it because you know what a two-year-old RV is appreciated heavily. Hello. They drop, they go down in value so fast. Winnebago is actually Native American Indian language for depreciating. Really? It's actually what it means.

I'm going to have to look that one up. I got to fact-check you on that one.

I'll buy it. That's what it means. It means down in value. That's what it means. In the ancient tribes. I didn't.

Know you were well-versed in the tribal languages, Dave. You never cease.

To impress me. The things I get myself into. I'm trying to figure out how to say that in a way that I didn't get sued. But anyway, good luck with that. This would be.

Similar to saying, I want to live in an RV. I'm going to take out a mortgage on it.

Listen, I don't care if you get you a boat, honey, but pay cash for it. Don't try to say it's the same thing as a house. Please don't try to say it's same thing as a house and a car combined. You really got boat fever bad. He went to party on a house boat last week, and now he's figured out with his calculator how this is a good idea. No, it's not, honey. It's going down in value and you're going to end up in a mess.

Then you're going to have to buy a house later on down the road and you'll be broke.

Well, and you'll have a rusty old... I mean, you know what an old houseboat?

No, thank you.

I've almost bought one of those one time because I really had it bad for a houseboat.

I could see you guys just having one at the lake to party on.

Yeah, but I've got a house now. But back then, before we had that, we were going to get a houseboat. I looked at this old, nasty, I mean, you can't say mildew like old houseboat. I mean, it's old houseboat mildew is a-.

I imagine the maintenance.

On those things- It's a special level of.

Science, I'm just saying. Because you've got a boat and that takes some maintenance.

Let alone a houseboat. Well, regular boats, but I mean, my God. No, Joseph, no, I wouldn't do that. You don't find any millionaires to go, You know what? I made my first millionaires. I lived on a boat. Didn't come up. Never comes up. Robert is in Phoenix. Hey, Robert, welcome to The Ramsey show.

Hi, Dave. Hi, George. Yeah, I have a pretty, I guess, not unique situation. I'm just in a bit of a bind, and I'm curious. Currently, I work in the technology field. I bring home about 100 grand a year, and I'm in Baby Step Two. I've been doing this for about two years, paid off 79,000 of my original 227,000.

You have done a great job. I, however, have not. I goofed up and brought you on with not much time left in this segment. I'm going to make you get straight to the point. It's my fault. I apologize.

Okay, not a problem. Yeah, I was looking to do a career change, but I'm not sure if it's the right step.

To do. Is it going up?

I'm looking to get in. It's not. Then don't.

Do it.

That was not initially.

How quick till you're done with baby step two?

By my math, another four to four and a half years.

How far would you go down an income and how quick would it come back?

So if you're going into mental health, I'd drop to about 40 grand.

A year. You can't do that while you're in debt and making six figures. You can do that later, but you got to get the debt cleaned up. And that'll give you that much more incentive to work more right now and get the debt cleaned up as fast as possible. But there might be a different way to go into the mental health field that doesn't require you work for 40. That doesn't sound like fun. This is The Ramsey Show.

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Ramsey personality is my co-host today. Open phones at triple-eight, 825-525. Benjamin is with us in Lansing, Michigan. Hi, Benjamin. Welcome to The Ramsey Show.

Hey, guys. Thank you so much for having me. This is great.

Sure. What's up?

Well, Dave, I've got a question for you. How do I cash flow a new construction, or should I get a mortgage?

Well, the cash flow is just sixth-grade division into the number of months that you have and the money you need to throw at it, right?

Okay.

I'll give you a little bit. How much is the house going to cost?

We're getting our blueprints in about a month or so. About a year and a half ago, we bought our dream property. We live on 40 acres, but we also live off-grid. We don't have any running water. We use an out-house. We love it. But we also have a seven-month-old baby, and we want to get a bigger house going.

Okay, all right. You got to put in utilities in a house. What's the budget on this?

Well, I make $65,000 a year. My wife is a stay-at-home mom, and we're planning on doing a fairly straightforward build. Budget, I'd be comfortable spending somewhere around $300,000.

Okay, all right. How long will it take to build it?

Probably three years. Okay. I'm planning on doing most of the work myself, to be honest with you.

That's $100,000 a year, $8,000 a month. You don't have that.

Okay.

Right? 300 divided by 36 is 8,000. All right. Follow me? Yes. That's the division I was talking about, the sixth grade division. Do you have any down payment or any other money we haven't discussed?

Yeah. So far we've saved about $40,000 cash. We have a $30,000 emergency fund, and this is after 15% of retirement, towards retirement, I guess. Okay. Yeah, those are the numbers we're working with. The property itself, we bought for about 160. Currently, it'd probably be closer to about 200,000.

Is it.

Paid for? It is completely. Yeah, thanks to you. Okay.

I didn't pay it. You did. Good job. Well, I mean, if you take out a construction loan, we know you've got 40,000 to put down. So if it's a $300,000 build, whatever cash you can come up with between now and the time you're building that you actually break ground and you start putting on it, let's say you came up with another, I don't know, whatever, then the rest of it's going to be a construction loan, right?

Okay. Then that would transfer to a mortgage later.

Down the road? As you finish the house. I don't think a construction loan is going to let you go three years and screw around with this. Most of them aren't going to allow you to be the GC. They're going to want a GC signing off on it.

Okay.

But you can check. I mean, maybe your local credit union will do that since you got so much equity in the property, they might. But this scares bankers because people have a tendency in these situations to not finish. If they don't finish, they've got a really nice piece of acreage with a half-butthouse on it. That's what they foreclose on it. It's a mess. I've tried to buy a couple of those at foreclosure. They're a mess. But it's someone's dream that turned into a nightmare. What I don't like about your equation is how long it's going to take you. Okay. I would do something to tighten up your time frame.

Gosh, I'm still super against having to pay out monthly towards a mortgage. Would it be better just to save the full amount of the house as.

Take it? If you can do that, you can do that. If you do that, how long does it take you to save 300,000 bucks? You got 40. You need to save you more. How long does that take?

Okay.

All right. If you do it $10,000 a month, it's 26 months. If you do it in $5,000 a month, it's 50 months, 52 months. So we're bumping up on five years at $5,000 a month, and you don't make $5,000 a month. Which means you're going to have to make more money. You don't make $5,000 a month.

Okay.

You're talking about 10 years to save up the money at your current income rate. Now, obviously, you can do something to change that.

It sounds like you have a sense of urgency here to build something. You've got a.

Seven months. He's got an outhouse and a baby. Yeah, that's urgency.

I'm not waiting 10 years. I probably am not waiting three years. I would probably work with a builder at this point and get it done faster and take on a reasonable mortgage that you can knock out quick.

Yeah. I don't borrow money, so I would be doing something completely different than anything you've done here, Brad. But if you take out a construction loan that converts into a mortgage that is no more than a fourth of your take-home pay on a 15-year fixed, we don't scream at you about that. I think you've got some work to do yet on adjusting what you can do to adjust your income up and your time frames. But a long build is hard on the house because it sits in the weather without a good roof on it for a while. Then once you finally get it in the dry, all the mechanicals and the rough in are sitting there, and it's hard on a house to build it slow.

It sounds like a lot of work. I mean, you sound confident that you know what you're doing. But man, an off-grid build like that sounds like you better be a pro.

Yeah. Well, I mean, it's just hard on the materials sitting in the weather. You don't want the framing package sitting there with no roof on it getting rained on, snowed on for four months because you're screwing around and they're doing something else. That's what.

Happens in these things. He's in Michigan, so that's some rough.

Winters out there. You got some weather issues and temperature issues on when you can do installs and things. That's the thing you got to work through is all that. Brad is with us in Huntsville. Hey, Brad, welcome to The Ramsey Show.

Hey Dave. Hey, George. How are you guys doing?

Great, man. How can we help?

Yeah. My wife and I eloped last year in February 2022, and we're considering having a reception next year, late April, for about $9,500. We currently have about $95,000 of debt and credit card debt, card debt, and student loan debt. We also have a mortgage that's currently sitting at about $270,000, $1,700 payment per month. I make about $170,000 a year growth, 100K after taxes, 401K, all that jazz. I wanted your input on that right there.

You want to throw a $10,000 wedding in April. How much would you need to save every month from right now to do that?

Well, we have some savings. We got about 25K in savings. But if we wanted to start saving right now, six months.

I would-.

So the 25K, remind me again, you got 95 in debt.

Yeah, in credit card, student loan, and card debt. We also have a mortgage.

Yeah, of 270. Then you make 170, but you're also having coming out, and you have 25k sitting there.

You're doing all the steps at.

Once right now. Yeah, you're doing nothing. You're doing nothing, we teach. Okay, all right. What we teach is a process called the baby steps. The first step is $1,000. Anything above $1,000 saved goes towards your debt. Then beans and rice, rice and beans, stop all retirement savings temporarily. Throw everything at the debt as fast and hard as you can. How quick do you pay off? 70 with no 401(k) coming out, making 170, and no eating out, and no going on vacations, and no whining, really fast, like less than a year. One-70 minus 70 is 100. You can make it, dude. Then you do your way, then you do your reception.

After we pay off the debt?

In less than one year, yeah.

Because you guys have already waited two years to throw this party. What's two and a half at that point if you guys are able to do it completely debt-free?

Yeah, that's true.

$70,000 is $6,000 a month. As soon as you're debt-free, you have the party the next month. You celebrate debt freedom and a marriage. Tada!

Yeah. The current amount that we have in savings, you think take most of that and.

Throw.

It directly into debt. Throw it to debt? -and throw it to debt.

Yeah, that's what we teach.

You can get the $1,000.

Is still- Do you make an emergency hits, the next paycheck covers it.

Well, yeah, well, the industry that.

I'm in- Hey, Brad, you do what you want to do, dude. I'm not arguing with you. We've been doing this a long time. Hold on, I'll send you a copy of the total money makeover book. It'll outline what you should do, and then you get to decide what you will do. This is The Ramsey Show.

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Thanks for listening America. George Campbell, Ramsey personality is my co-host today. Open phones at triple-88825-5225. Doug is in Milwaukee. Hi, Doug. Welcome to The Ramsey Show.

Hi, Dave and George. It's a pleasure to be able to speak with both of you.

You too. What's up?

Hey, just wanting to confirm what I think you would say, but I'm approaching 65. I still want to work past my 65th birthday. I recently became unemployed, so I'm job seeking. But I have a small 401(k) from my last job, only about 25,000. I wondered if it would be wise to cash that out and pay off consumer debt of about 20,000.

Well, obviously, you're not going to have penalty on it, but you will have taxes on it. What concerns me is what that... What can I use this with? Which is nothing, and you're 65 years old.

Yeah.

Obviously, what you would love to have is a big old pile of savings and no debt, right? Correct. Yeah. How can we best get there? Then how do we use this money to do that? I would prefer to leave it alone almost as a symbolic act that I'm going to add a bunch to my retirement as soon as I can get re-employed and clear this 20,000. But in a worst-case scenario, I would clear it. I would use the money and clear the debt. But I think you need to have the mindset of, I got to get this debt cleared quickly so that I can quickly add to my retirement nest egg because you need to be doing both. Agreed?

Agreed.

Yeah. What were you making before you got laid off?

I was making about $60,000.

Okay. Doing what?

It support.

Okay, all right, cool.

What debt do you have?

I do have between $13,000 and $15,000 in credit card debt and another $7,000 in a no interest loan on some machinery my wife uses in her job.

What does she make?

She makes about $300 a month.

Okay.

$300? Yeah. $300, yes.

What's the machinery? Because it sounds like this is not going to ROI for her.

It's basically high-end sewing machines. Yeah. She's a seamstress factory.

Well, it's there. I mean, it's not worth anything now. We wouldn't make that investment again. $7,000 to create $300. $300 is 3,600 a year. You need to make a better return on that as a seamstress or anything else in business. But you're there now because that machine is not worth what you paid for it. Now it's not because it's used. I think you got an opportunity as somebody that knows something about IT to do a lot of side hustles, freelance work, as well as pick up some jobs. If I'm in your shoes, I want to create as much income as I can create, and to talk this 20,000 out as fast as possible, living on a very, very tight budget. I'm going to also ask her to put the old sewing machine in gear and let's do a lot more than 300 a month. Let's try to get that to 3,000 a month and try to get some income coming in so that we've got a Nesteg to retire on here.

I do have a side hustle or I did have a side hustle. I am getting some work from now, but I'm actually trying to cash flow training for another job that I think I'd love more.

An IT cert?

No. What? Actually, I'd like to become a Ramsey Financial Coach.

Okay, all right. I would not spend money on that right now if I were you. I'd love to have you as a coach. I'm not trying to insult you. I'm just saying I would rather you go and make some money right now and get some of these other things going before you spend money on something like that. We'd love to have you. Don't misunderstand, Doug. I'm not trying to be mean to you. But I also wouldn't be a bit hypocritic of them like, Yeah, give me a bunch of money while you're broke.

Let's call that an encore career once we clean this.

Debt up. Yeah, let's put that as something once you've got the debt cleaned up, you got some money going into retirement, and then go find the money to go get the certification on that, I would do that. But no, I wouldn't spend the money right now to go effectively into debt, because you're instead of paying it on debt, you're going to spend the money on that. So no, I couldn't do that for you. I wouldn't be consistent if I suggested that, even though I do believe in our coaches, and I'm again, not trying to be insulting to you. Chris is in Augusta. Hi, Chris. Welcome to The Ramsey Show.

Hi, thank you for having me on. I really appreciate it. Sure, how can we help? I am three years from retirement. My student loans, I make my 120 payments. I'm an education for my public service on forgiveness in April, so I'll be done with that. The only debt we have outside of that is our house. We know we're going to probably move in the next 5-7 years. I'm back to where our people are at. Should I concentrate on paying off the house or should I concentrate on building up my retirement fund?

What are you investing right now into retirement?

I've had a 403(b) in quite a few different places. I just consolidated those with a brand new specialist, I'm a fiduciary. It's right at 40 grand.

That I have- Sorry, you broke up with a risk.

It's right at 40 grand, yeah.

Yeah, right at 40 grand. My retirement from teaching will be right at 60,000 a year.

Are you putting anything into retirement now?

At the present moment, no, because of the student loans. We do not have fully funded amount yet. Okay.

Then you would not be paying into retirement or extra on your house, either one. Did you say you had four payments left? You've been on a private or are they a public student loan forgiveness for 10 years?

You have to make 120 payments on the student loan forgiveness for education. Yeah, it's 10 years. Yeah, I'll meet 120 in April.

Okay. Well, I pray that you are one of the few that that that works for. You are aware that only 4% of the people that apply for that are actually getting it.

I am.

I've.

Been meticulously keeping my paperwork.

I'm not sure thathasn't mattered because they're a bunch of freaking lies up there. I'm serious. The last time I looked, it was 1.16% of them are approved, which is 98% or not. You'll and I'll promise you they thought they had their paperwork in order. The whole thing is a freaking shamb, but I sure hope you get it. What's the balance on the student loan?

It's more than double since I've had it. It's at 225 right now.

That's because you were holding out for this public student loan forgiveness?

Partially, but even when I was making payments, it was one of those stories where you make your payments and it still grows.

And it's- The minimum doesn't touch it.

Because of the interest. Yeah, absolutely.

Which makes me want to burn Washington to the ground. Good people like you, having been misled like this, I sure hope they forgive it. I'm not hopeful, though, from a practical standpoint. Okay, so let's set that aside. Your first thing is build your emergency fund. Is that your only debt other than your house?

Yes, sir, it is.

Okay, your first debt between now and April, build your emergency fund as big as you can build it. Then let's see if the forgiveness goes through. If it doesn't go through, you're going to have to deal with a student loan. If it does go through, that'll be gone. Then we will move to putting 15% of your income into retirement.

The.

Rest would go towards anything else you can find, you go towards paying extra on the house regardless if you're going to move. I don't care if you're going to move or not unless you're going to move next month. But because three or four or five years, who the crap knows when you're going to do that? I mean, I don't know. You don't know even. Just a general feeling you've got. That doesn't change the idea that you need to get a paid-for house. We need to get paid-for house and a big old money when we get to retirement. That's the game plan.

Okay, absolutely can do that.

Let's start on the emergency fund right now. Do you see anything.

Else, George? No, that's it. But I mean, if that emergency fund, it might be your saving grace to start knocking out these student loans. If it's a dash versus a slash, they'll reject it. That's how silly these applications have been.

That's not just a Twitter saying, that's an.

Actual syntax. I saw an actual video of that.

Real sad. An actual deal. The guys are looking for any excuse. It's just horrible. 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. George Camel, Ramsey personality is my co-host today. He's also the co-host of the Ramsey Network production called Smart Money Happy Hour with Rachel Cruz. You don't want to miss out on anything George is doing, especially on the YouTubes. He's pretty good at that stuff. Open phone is a triple-eight, 825-5225. Alex is in Sacramento to start off this hour. Hi, Alex. Welcome to The Ramsey Show.

Hi. Thank you for taking the call. I just want to say thank you because with your program, we were able to purchase a home and we're now on baby step four.

Well, congratulations. Well done.

Thank you, too. So my question is related to investment. And so my husband and I were both teachers. We both make about $80,000 a year, and we don't have any debt. However, we just had a baby, and we'd like to stay home. At least one of us stay home with a baby for two years. So we saved enough money to do so. We have another daughter, so two children, and we haven't started saving for my other daughter's college yet. This is my second marriage. The first one was very short-lived. I was very young. However, God blessed me with my new husband. Unfortunately, my daughter's biological father passed away. So she is receiving Social Security income each month. So I'm wondering, should we be investing and should I be saving money for her to go to college?

Yes, to all of that. Are you planning on staying home at this point? Have you guys talked through that?

Yes. Right now, I'm staying home with the baby.

Okay, and you guys have crafted a budget and looked at, Hey, can we make this work in the Sacramento area off of one income of $80,000?

Yes, we were able to save enough money.

Great. Wait, wait, wait, wait.

You said you have savings you're going to use to cashflow this? Yes. How much?

We saved around 25.

So you can't live on 80?

No. But when we were able to, using the budgeting app, we were able to calculate how much we would need in order for us to stay. One of us to stay home.

Right. Which is $1,000 a month for 24 months, right?

Yeah, about there.

Yeah, when you got $25,000 and you said saved, and then you're going to use all that to subsidize the fact you can't make budget at 80, right?

Yes.

You're a thousand dollars a month over budget.

Mm-hmm.

Okay. You have an emergency fund in addition to that.

Yes. No retirement.

My worry is you're looking to save for college. Do you guys own a home or are you renting?

We own a home.

Okay. I don't think you're going to be able to invest 15% and save for college and pull off this plan right now.

No, you're not doing either. You don't have college or retirement built into your $1,000 burn rate, right?

That's right. Yeah.

That's the part that really scares me with this. I think we need to hit pause on this or figure out a different solution. Maybe you bring in the extra thousand, and we still need more money than that to invest for the next two years.

Yeah. Why don't you tutor part-time while you're staying at home? You can make 50 bucks an hour in Sacramento doing that.

Okay. My daughter, the income that she's receiving from Social Security is.

A little over a dollar. Is that not in your budget?

It's not in the budget.

Okay. All right, let's stop and park on that for just a second. You're not morally or legally obligated to do anything with that money, except put it in the budget, because you spend more on your daughter than that Social Security check is. That's just to supplement the raising of your daughter, and your household spends more money than what they give you on the daughter. It can be a part of your budget, morally and legally, and that's usually what we recommend. Because you've got this dialed down so tight, if you want to use that to start a college fund for her, that's fine. I don't care. But I don't want you to do that thinking that this money has to be earmarked for that somehow, or you're a bad mom, or it has to be earmarked that you've done something illegal. Neither one of those things are true. True?

That was my worry. I just want to use this ethically.

Well, ethically would be if you put it in your budget and you take care of your daughter, which includes saving for college for your kids, that would be you've done ethical. Because you're spending, believe me, you spend more raising a kid than that check each month. Agreed? Yeah. Easy, okay? The same thing is true usually with child support for that matter. It just rolls up into the budget. It doesn't have to be set aside for the actual child. It goes into the budget because we buy stuff for the child, like shelter and electricity and things like that in the household budget that is for the child's benefit. It's ethical, moral, legal, all of the above. But right now, you've got the budget dialed down, and you don't have anything to put in kids' college if you want to use this since it's not including the budget, as long as you're not doing out of some emotional obligation, then I'm fine with that, okay?

Okay.

Yeah. I don't like that you're burning this money. It's not a healthy place and you're not putting money into retirement. I do like you want to be home and you're figuring out a way to be home with the babies. I'm all for that, okay? But you're really straining at this. So if I'm you guys, I'm picking up some extra work between the two of you with tutoring is probably your highest income as a side hustle and try to earn a thousand bucks a month so that we don't touch this 25. And then that allows us to start putting money into retirement, possibly. Okay. Now, let's try to adjust just a little bit here. You're close. I mean, thousand bucks a month on an $80,000 budget, it's only 12 a year. That's not-.

That's side hustle money.

That's side hustle money. Easy side hustle money. Not much hustle, just sad.

A lot of people, Dave, don't know about the spousal IRA. For those that are stay-at-home parents, they still have the ability to fund an IRA, which can be a great thing. So don't miss out on that if that makes.

Sense for you. You can do a full Roth IRA if your spouse works and you don't. That's called the spousal IRA. You're just disqualified as if you had an earned income. My wife, Sharon, has not worked outside the home in 30-plus years, and we've never missed a single.

Roth IRA. Way to go.

Ding, ding, ding, ding, ding, ding. That's the way to do it. Well, since they started doing IRAs.

Oh, I didn't think about that. That was before my time, I guess.

Yeah, it was after we went broke. There you go. But yeah, not the entire marriage, we haven't been doing it. But once we got some money and we were funding retirement, we've always done a spousal, to your point. That's a good reminder, IRA, because you qualify for that if your spouse has an earned income. He has to be. Earned income has to be in excess of the two IRA amounts combined, but it obviously would be. I mean, it's only, again, only $12,000, $14,000, so not a lot of money. But you'll get there. You'll get there. I love it. I like what you're doing, Alex, and that you're planning very carefully. That's what keeps people out of trouble, is very careful planning. What is a little bit scary is your burn rate. If we can adjust that, I think you got a fabulous plan. This is The Ramsey Show. I get heartbreaking calls and emails all the time from people dealing with the loss of a spouse or parent, and many of them can't even grieve properly because they're too stressed about the money. This is exactly why you must have term life insurance. You cannot leave your family in this situation.

Let the team at Xander Insurance help. I've trusted these guys for over 25 years, and I know they are caring and professional. Go to zander. Com or call 800-356-4282. George Campbell, Ramsey personality is my co-host today. Our first ever money and marriage getaways a weekend retreat is this coming weekend. October 19th to the 21st here on the Ramsey Campus, you and your spouse will be equipped with tools to cast vision for your family, set goals, create the life you both love. The money and marriage getaway is, of course, Rachel Cruz and Dr. John Deloney. The only thing funnier than that would be if George Camel was involved, and then there's lots of humor. The three of them get together. It's an absolute hoot. I can't wait. Me and Jade, just watch. We just watch the circus when it happens.

Deloney is the circus. I wrangle the circus.

I can't say not my monkey, not my circus on this one because it is my monkey, is my circus. You're PT.

Barnum, Dave. You are PT Barnum. You put on the circus.

I'm the guy.

You collect the checks.

I go in.

The ring and take.

The lions. Let me know when that happens. Anyway, the tickets are still a few available. I mean, literally just a handful, but it is just a couple of days away. If at the last minute you want to impulse, come to Nashville and you've got the money, obviously. Don't impulse something when you're broke. That makes you broker. We're not talking about that. But this is a great weekend. It is a three-day event. October 19th of the 21st, it'll be at our Ramsey Event Center here on campus. The whole team is gearing up for this. We're really excited to have you guys on campus with us. Thank you. Tickets are 7:99. Again, just a few of them left, ramseysolutions. Com/events for your tickets. Mike's in Dayton, Ohio. Hey, Mike, how are you?

Good, Dave and George. I'll get right to my question. I've been telling you for about six months, and we paid off all our credit cards. Now we're down to nothing but our mortgage. But I have two parent-plus loans for my daughters, and they want to do that pay-for-play thing or whatever that's called that extends them out. I'm 59, andalmost 59 and a half. I have a half of... I have $500,000 in 401,000 between me and my wife. I also started a new job about five years ago, and I was putting a lot into that. I have about 125,000 in that. I was wondering if I should, when I get 59 and a half, if I should use that $125 and pay off them.

Two parent-plus loans. How much are they?

One's $41.5, and the other one is $18.78..

How would?

Just pay them off? Yeah.

Okay, I didn't know- You are technically liable. They are not.

I understand that. They said they would pay them back, but-.

But then they said they weren't.

Well, they're going to do that.

Extended thing. Well, that means they're never paid back. Do you understand that?

Yes.

That's why I- The extended plan is 30 years of not even making the principal payment. Exactly. Which means the principal is- Which means the principal is no interest is paid, and they don't even make a principal payment. It goes backwards for 30 years.

I know.

I've been listening.

To you. I've been listening to.

You, yeah. Yes. Stupid government program, the DMV visits finance class. I mean, that's what this is, right? Correct. Oh, God. Thank you, Joe Biden. Yes, that was exactly. I mean, can't string a sentence together and came up with this plan. Oh, my God. It's horrible. It's absolutely horrible. No, no, no, no, no, no. You're going to get stuck with it, dude. That's what's going to happen, so we might as well own that now and be done with it. Did you have an agreement with the girls before they went to school that they were going to pay these?

Yes, and they paid on them, but they're going nowhere. The $41,000 was originally 39, and the 18 was originally 16. They're going backwards on these already from when they took out.

The loan. How long ago was that?

Oh, Jeez, one daughter is 30. She graduated at 24 and she's 31.

Okay, so we're coming up on a decade, and what we've done is gone backwards. The way I analyze this is that pattern is probably going to go forward. We just discussed that. How does that work out for Mike? Well, that sucks is how that works out for Mike.

That's what I was wondering. But you always say never take out your 401(k), but I thought this might be a.

Good time at 59 and a half. I don't take it out prior to retirement. After 59 and a half, what you're talking about where there's no penalty, and you've got 500,000 or you've got 625,000, we're going to pull 60-something out plus some taxes to cover these, right?

Well, my raw office, Ihave them in a Roth. I have most of it in a Roth. So my Roth would be tax-free. I have about 44,000 in Roth.

In the 18, I would have about 15 that I'd have to take out of the standard 401 because, yes, you know what I'm-.

Do you sense the cleanliness in your spirit of what I'm talking about?

Yes, because I got my thousand. I paid off all my credit cards, which was $12,000, and now I'm stuck with this is the only thing on my credit right now is this.

And my mortgage. Obviously, I'm not worried about your credit, I'm worried about Mike. Mike's daughters are not paying this. That's what they announced. We're going to not pay it. We're going to pay it while not paying it. That's what they announced because they signed up for stupid government's crap.

Trusting a 17-year-old's good intentions to pay back isn't going to cut it. When parents sign on the dotted line for these, they don't understand what they're doing. They're potentially decapitating their retirement when they sign up for this. It's heartbreaking to hear. But, Mike, is this a stupid tax that we just got to pay as we enter our golden years and they're starting to look a little more.

Silver, a little more bronze? What's the stupid new one called the SAVE?

Save.

Plan. Which is absolutely the opposite.

Let's just stretch it out.

Yeah. It's like the Stay in Debt Plan. They nicknamed it SAVE, stands for some acronym, stupid….

Stupid… David can't say the second.

Yeah, there we go. Stupid, assenine. I'm thinking, Oh, God. Seriously, it's a 30-year plan, and when they give you the thing based on your income, it does not charge you any penalty or interest beyond what you're doing. But it accumulates principal because you're not even covering the principal with the payment. You have to have a Dr. Phil moment with these stupid things and go, How's that working for you? It's not. You've been screwing around with a government plan since you got out of school. You're 31 years old. It's gone backward $3,000. You announced to your dad that the way you're going to help him out and honor your word to him is that you're going to pay this is not pay it again. And let it go backwards.

Some more. Now stick them with a higher balance than he started with. Exactly.

That's the net of this. Now, these girls didn't know that. They didn't think that, too. But that's.

What happens when you- It.

Wasn't a maniacal plan. -believe in a stupid butt plan coming out of Washington, D. C. Mighty. God, a mighty.

We heard story.

After.

Story. So aggravating. The Barred Future podcast and the documentary of all these people who were like, Well, the government's giving me such a gift to lower my payment based on my income. Then they wake up 10, 20 years later and their principal has doubled, and now they're really underwater and they're really screwed.

The guy in the other hours, he started with 100 and something, 200 and something, thousand now.

It's.

Just balloons. Counting on the private or the public student loan forgiveness, the PSA, which is notYou're going to give Dave an aneurysm, America. It's just exhausting.

You're going to give Dave an aneurysm, America.

It's just exhausting. Well, I just hate it for you guys because you're getting screwed by your own government. The first way they screwed you was they had to put a student loan program in place for you to get $150,000 in debt to get a degree in left-handed puppetry and told you that was the way to success. Now you're a barista and you're screwed. It's just awful. It's just awful. Then they come out and go, We're going to forgive it. Oh, no, we're not. Yes, we are. No, we're not. No, we're yes, we are. Really, they don't intend to forgive it. They want to keep you. It's the biggest scam perpetrated on the American public by our government mathematically in history. The second largest scam was the genius that invented the idea that we take your taxes out of your check before you see your check. If they posted a tax guy inside your building and you had to walk out and hand him cash out of every check, there would be a revolution in America. Pitchforks, torches, because you people would see how much of the money you earn you're giving to this government to misbehave.

You would see that. But no, it just came out of a check. I didn't notice it. But tax collectors would be as reviled as they were. We would name the guy Matthew. After the Biblical Matthew. They would be as reviled as they were in the Bible. Post him inside your building, little Matthews, and they're collecting a check. Him and Zadeus, they're in there collecting your check.

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George Camel, Ramsey personality is my co-host today in the lobby of Ramsey Solutions on The Dead Free Stage. Rakeisha is with us. Hi, Rakeisha, how are you?

Hey, Dave. Hey, George. So good to be here.

I'm great. We're honored to have you. Where do you live?

I live in.

Cleveland, Ohio. Very cool. Welcome. How much debt have you paid off, Rukisha?

$253,000.

Good for you. How long did that take?

Four years and one month.

Good for you. Wow. Your range of income during that time?

Went from $60,000 to $375,000.

Nice.

Job. Okay. Yeah.

What do you do for a living?

I am a surgeon.

Oh, well, there's that. Okay, so we went from residency into the real big stuff.

Yeah, I finished my fellowship training, then became a.

Staff surgeon. Okay. How long have you been finished with your fellowship?

I finished in about two.

Years ago, 2021. Okay, so you've been in the big bucks for a couple of years. A couple of years, yeah. You didn't go live like a stupid doctor. Instead, you went and paid off your bill.

That's right. That's right. Look at you. I still drive my 2012 Mitsubishi Lancer. So the lifestyle creep did not get me. It didn't creep. It did not. How much of this was med school debt or the 253? The lion's share of it. It was credit card, the timeshare, and then most of it was medical school loans, about 200,000 a little over.

A whole bunch of things to get clear. Way to go. How long do you remember back in your childhood? How long have you wanted to be a doctor?

Only senior year of high school when I took a field trip to a local medical school. Before that, I wanted to be an engineer.

Okay, so a valedictorian of your class?

Oh, no, not at all. Not at all? But I did well. I was top 10%.

Or something like that. Yeah, you got in med school, so you're no dummy, obviously. Yeah.

Well done. What surgeon? Now I can do dumb stuff with money in particular, so don't put it past me.

Well, we have all got that ability. That's not the question. But I'm just trying to look at you. Well done.

Very well done. We said what surgeon? I do general surgery and actually weight loss, bariatric surgery.

Okay, all right, very cool. And you're in Cleveland, Ohio? Yes. Okay, good. Doctors in your family?

No.

Doctors. Okay, all right. So you're the first one?

Yes.

Sir, I am. Look at you. Wow, congratulations. Thank you. So what made you decide to go the opposite of all of your peers, which is keep the student loan debt around for a decade or two, which is what most of them do, and they go buy a new BMW in a house they can't afford as soon as they get out of med school?

Yeah, when I graduated in 2019 for my surgical residency, I had a month off before I started my fellowship, which was a two-year at Cleveland Clinic. And during that time, I just had some time to breathe. And I was like, Well, why don't I get my finances in order? I started figuring out how I could be debt-free and wealthy. That was one of my affirmations. Soon after I Googled that I found the Ramsey program, and I was hooked when I started listening to the show. I loved how you were being hard on people, like that tough love, which is my love language. From that time, I decided to get on the plan and get after it. That's amazing. And so what were these sacrifices that you made? Did you just keep living how you were living, or was it hard seeing how your friends were living at that point? Yeah, it was in a way, but once I learned about the plan and had a sense of direction, because before that, I had no clue how I was going to get to wealth and debt freedom, but I bought an efficiency. When I moved to Cleveland four years ago, I bought a studio that was like $700 a month.

I definitely sacrificed that way. Then during my surgery fellowship, I took on extra call and did some moonlighting at smaller hospitals that needed some coverage.

What does that pay?

Anywhere from 400 a day to you can make probably a thousand a day.

So on the weekend- Because you're a resident at that point? Yeah, I was a fellow at that point. So they're not paying you full doc rate.

Correct. I was in my fellowship making $60,000, so I could make a couple 1,000-2,000 extra a month. I was putting it toward my debt.

Okay. But still mathematically looking at this, I'll bet you you paid the most of this in the last two years since you got the 375.

Correct. Absolutely. Yeah, the lion's share. Once my income went up times five. Well, you already had the habits in place, and then you just added fuel to this thing. Absolutely. The budget was it. Once I had the game plan, yeah, all that extra money.

Any of your peers cheering you on, or they all think you lost your mind?

Oh, yeah, they were cheering me on. They were like, That's great for you. My family and friends were cheering me on. I was trying to get most of them to be on the plan, but I wasn't as successful with everybody, but had a lot of support. People were like.

Wow, good for you. Most people in med school catch a disease called dociitis, and when they graduate, they go spend money they don't have because now they're a big doctor, though only they're a broke doctor. It takes them about a decade to recover from the stupidity two years after getting their degree or two years after passing the bars and passing the boards and getting MD. Yeah. Wow Congratulations. You're sharp. Thank you. You're a rock star. Thank you so much. Amazing, amazing hero.

I'm scared to see how much wealth you build. Oh, my gosh. It could be your lifetime now. I already bet.

With mine. $375,000. You got to do something big and cool to celebrate. What are you doing?

Well, this happened in July. I actually got out of debt officially. My birthday is tomorrow, so this was my big present to myself to come here and do my debt-free screen.

We appreciate that, but you got to do something bigger. You got to go big. I mean, you make $400,000 a year, you don't have payment in the world. Right. You earn some cool celebration.

Upgrade the car or something.

Yeah, I mean- That car needs upgrading, girl.

Upgrade that car. It runs fine. -upgrade that car. -i've learned during.

This time. -you make $400,000 a year, upgrade that car.

Get you a good car. Next is a good down payment on the home.

There we go. Okay. All right. You can do that too. You can do that too. You got plenty of money. I'm not saying about an $80,000 car, but I mean, go get you a $20,000 car on top of what you got andYeah, at least. Come on.

If you say so, I might then.

I'm just telling you.

We have broke people that buy $60,000 cars, so you have earned it.

Yeah, you make 40,000 bucks a month or $35,000 bucks a month. I mean, come on. So hello. Way to go. Amazing. Way to go. I'm so proud of you.

You're amazing. Thank you all. You're inspiring. Hey, you all are inspiring. You all are such an inspiration to me. I'm really thankful for the program that I found you all.

Well, we're glad you're here. I hope we can help you in the rest of this wealth journey. We've got the Baby Steps Millionaire's book. You're going to be there in 20 minutes for you, and the Total Money Makeover book to give away to someone who's inspired by your story and your family or friend group, and certainly Financial Peace University as well. All of that's for you just to say thanks for coming down from Cleveland. We are honored to meet you. You are a hero. Thank you all. You have complete... Talk about somebody who changed your family tree. Whole everything. I mean, the education piece, the whole bit, and making serious bank and not a payment in the world. Wow. All right, count it down. $253,000 paid off in four years and 11 months, making $60 to $375. Count it down. Let's hear a debt-free scream.

Three, two, one. I'm debt-free. Yeah.

That's what I want my surgeon to sound like. I love it.

She's operating differently now on a.

Whole new level. But I want... Way to go, George. That's impressive. She's operating on a whole new level. This is the Ramsey show. That's what she needs, the T-shirt. It's crazy, George. Wait a minute. It's not the Ramsey show yet. It will be in a minute, but… We.

Got excited. We got a.

Little trigger. I got fired up there. That was pretty amazing.

She's.

Impressive. Here's the trick. Did you hear what she said she did? I got on a budget. When I had the break, I sat down, I said, This is where I am. I'm going to be wealthy. What do I have to do to get there? What must be true about my life for me to get there? I'm going to get on a plan. She jumped on like every dollar, started doing that. The every dollar webinars, you and Rachel and Jade are doing those again. That's right. They're free. You can go to everydollar. Com/budgeting and sign up. It's completely free and learn how to do what she did, and that is take stock of where you are and end up, as George said, operating at a higher level. Oh, that was just too corny.

I know. But it was really good. I'm a dad now, so I make dad jokes. That's good. Thank you. But it's true, whether you make 30,000 or 300, because people go, Well, Rakeisha makes so much money, of course. Uh-uh. You saw that.

Sacrifice when she was making $60,000, and she paid off.

$253,000, too.

Hello. Big hold, big shovel. Most of you don't have that. There you go. That's impressive. Tell me it can't be done. It can be done. This is The Ramsey Show. Here's the thing about investing advice. You can find it just about anywhere, but that doesn't mean it'll always help you with your personal goals. Here's another option. Check in with a Smart Vester Pro. These financial advisors can review your plan or help create one that's personalized to you. To find a Smart Vester Pro in your area, go to ramseysolutions. Com/smartvester. Go to ramseys.

Com/smartvester. Ramsey Solutions is a paid non-client promoter of Participating Pros. Learn more at ramseysolutions. Com/smartvester.

George Camel, Ramsey personality is my co-host today. Thank you for joining us. Emma is in Albany, New York. Hi, Emma. Welcome to the show.

Hey, guys. Thank you so much for taking.

My call. Sure. What's up?

I'll start with a little bit of background. I am 26 years old. I have no debt. I have an emergency fund, and I just started paving up for a down payment on a house.

Good for you.

Also, in doing this... Thank you. In doing this, I'm looking at how much my paycheck is going where. And the one thing I keep coming back to is how much is enough to retire on. Now I know you guys have that general 15 % guideline, but since I graduated and started working, I've been contributing between 20 and 25 % to my retirement. So it's pretty front loaded. And now I worry a little bit about having too much of my net worth tied up in funds I won't be able to access for another 30 plus years. So that leads me to a two-part question. First, how much is too much to have in your retirement? And how do I plan for something so far in the future, considering we don't know what inflation or cost of living is going to look like by then?

Great questions. It sounds like you are way ahead of the curve. How much do you have in retirement currently?

Currently, about 100,000.

Amazing. It sounds like you want to retire early, by the way you're talking. You're saying, Hey, I can't wait 30 years to access these funds. Are you saying, Hey, if I want to stop working or have the option to work at 50, what do I do?

Yeah, if it's possible, sure.

Okay.

It will be possible in your case. What do you make a year?

About 95,000 a year.

Good for you. Well, you're doing really good. I would put you in the top 95th percentile of somebody your age. You are kicking it. This is more of a theoretical discussion than it is an actual discussion, because you've really got dialed in. Let's just say that Emma has her act together, okay? Thanks. All right, thanks. All right. Now, if you want to do what we would call some bridge investing, you'll be able to do that beginning in your late 30s and still be in great shape. You got 10 years before you have to worry about that, okay? The only way you'd want to worry about that is, like you said, you've got a lot going into retirement. You're going to be putting 15% of your income into retirement. It's only $15,000 a year right now. You're going to put the balance of what you can find on the house and get the house paid off after you make the purchase on the house, all of that stuff. In your 40s, you should have over a million dollars. If you want to at that point go, I'm going to start side loading some money over here.

Some of the money I'm going to save. Once my house is paid off, I mean, you could continue to put 15% in retirement and have another 10% going into non-retirement investing. Just an S&P 500 would be fine if.

You.

Wanted to. That's what I did. I maxed everything out, and then I just threw money to the side and had more than enough wealth long before I got into my 50s.

Here's what that equates to, Emma. You can go down to 15% investing, keep saving for the house. That's going to help you save up for the house faster, get it paid off, then you can increase your investing. I just crunched the numbers here for her, Dave. She's going to have $7 million at her current rate. If she just invests 15% and you get a 10% return.

She's going to have- Is that including the 100 that's.

Already in there? That includes the 100. You'll have seven million by 60. You'll hit a million. You were spot on day by 40 years old. She'll have a million bucks.

In that account. I thought she'd have to be about there. That sounds right. What that means is that when you get that first million in retirement, if you're in your late 30s, early 40s, then just stop or slow down and then just chunk everything else. But when the house is paid for, you can go on up to 30%, 35% investing if you want to. You'll have plenty of money because you don't have a house payment.

Right.

And your income is going to go up through time. As far as predicting what returns are 40 or 50 years in the future, no one obviously can do that, or what inflation is going to do 40 or 50 years out. No one can do that. When I was your age, it was 40 years ago, and I started talking about doing this stuff, and now I got a bunch of money in mutual funds. That's the equation. It's not some nerded out tenth of a point to two-tenths of a point to I got to figure out the 12(b)1 fees, or I got to just invest. Invest, invest, invest, invest in good mutual funds that have a long track record. They're going to keep you ahead of inflation, especially inside of a retirement account, because the companies that cause inflation are the companies that you're buying stock in. By definition, that's a hedge. Okay, so if you're buying stock in computers, the cost of computers goes up, that's inflation. If you're buying a stock in oil and gas in your mutual fund, and the cost of gasoline goes up, which it has over 40 years, then guess what?

It's built into the profitability of your company you're buying into. Ultimately, the stock market in itself is basically an inflation hedge. The way you hedge against inflation is you buy items that are inflating: houses and companies that are charging inflated prices due to inflation, that's the name, and that's what you're doing. The way you're going to build wealth, you don't have to spend a lot of time freading over the economy or inflation or something else. The economy goes down, woo-hoo! We're buying stock cheap. Economy goes up, woo-hoo! The value of my stock all went up.

Based on the way Emma is talking, I think she needs to have some balance, live her life. You don't need to funnel every single dollar into investing. I want you to enjoy some of it, too. Right now, you're very much on track to have plenty of money. I'm not that worried.

About it. Done a great job. Franko is in Las Vegas. Hi, Franko, how are you?

Hey, Dave. Hey, George. I'm very excited to be talking to you today.

Sure. What's up?

My question for today is should I buy out my ex-wife out of the house, or should I keep waiting for the house to sell, considering the slow months ahead? So to give a little background on that, I recently went through a divorce that finished about a month ago. It lasted for about eight months. And since the beginning of the relationship and even the beginning of the divorce, I've been paying for the mortgage, for all the bills related to the house, and for all the debts that she's carrying right now, plus the three dogs that we used to have together.

You're paying three dogs that you used to have together? Yeah. I'm so confused. Why would you be paying for dogs that you don't have for an ex-wife?

Because since the beginning of the relationship, she basically decided not to work, even if I encourage her.

I don't care. Have you got the dogs? No, I don't. Then they're no longer your responsibility. Okay. If you want to take care of the dogs, go get them. But otherwise, quit paying for the freaking dogs for your ex-wife. Come on, man. Now, she's in the house?

She's in the house, yes.

You're paying all the bills. What did the divorce decree say about the house? It had to be sold?

Yes, it's in the process of being sold. It's been three months in the market with a lot of showings, but it hasn't been sold yet.

Okay, and you're paying the payment?

Yes, I'm making the payment and I'm paying the bills related to the house as well.

Okay, and she's living in the house?

Yes.

What a wonderful deal. I bet it's hard to show that house, and when you do, it's messy.

I'm actually not allowed to enter the house. She prefers for me not.

To- So what makes you think you can buy her out?

I've been.

Thinking that I could buy the portion, that it would be the same for her if the house gets sold.

Is she going to move with the dogs then? On? Yes.

You're sure? If I do, so I would hope so.

So far, you've not done very good deals.

Yeah.

She's got to move. You understand that? Yeah, I do. And the dogs.

At what point do you stop paying all of her bills?

When the house says?

Yeah, exactly. Are we sure about that?

Yes, it's part of the divorce agreement.

Yeah, but is Franco going to quit?

Oh, yeah, I'm going to quit.

How much does it take to buy her out?

About 50,000.

Okay, but it's not worth that because after expenses, you're not going to net 50 on half. You're not netting a full 100 when it sells, are you?

So the price of the house is about on the market, it's 630 right now. And because we still owe a big amount on the.

House.

We owe about 450.

Okay, there's not... Yeah, that's about right then. Okay, if you can come up with 50,000 and you want to buy her out and then sell the house yourself later, but she's got to leave. I don't think she's going to. 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. George Camel, Ramsey personality, is my co-host today. He is also the co-host of Smart Money Happy Hours. Rachel Cruz on the Ramsey Networks, and the George Camel YouTube show, Camel with a K. Be sure you check it out. Don't miss him. It's pretty informative stuff. Phone number here to talk about your life and your money is triple-8-825-5225. Christina is in Austin, Texas. Hi, Christina, how are you?

Doing good. How are.

You, Dave? Better than we deserve. What's up?

That's good. Thanks for taking our call. A little bit of background on that. My husband and I were 26 and 28 years old. And I have met life settlement that I've been receiving since I'm 21. And my husband has disability with the VA. And so outside of our job, we're bringing in income. So altogether, really, in a year, we probably been in about 90,000. But lately we have been having a lot of debt from student loans to credit cards to car payments. And I feel like the money that we're getting to utilize for other things is just going right to debt. And so we've been talking around the idea of possibly selling our home and paying off our debt with the equity we've built up over these last two years. But my husband, he doesn't think it's a good idea. He's scared to do that. And so I don't know, we've just been talking around the idea and we just wanted to get your input on that because this MetaLife settlement, I won't have it forever. And so I would love to invest that into other things instead of debt. But I wanted to hear from you what your thoughts were.

Well, you're not quite ready to invest. We got to clean up this mess. Selling a home is a big deal, and it's generally a last ditch thing if we have to to get out of this. But I'm not sure you guys are there yet making 90k. How much consumer debt do you have?

We have about 110, maybe 105.

How much of that is cars?

About 60,000.

That's a lot of car.

It is. I've actually been telling my husband for him to get rid of his truck.

I'd rather you get rid of the truck before the house.

Yeah, but he doesn't think that we'll get back enough to pay off the truck. But I think he should give it a try to see how much we'll get from it. But we've been getting... What's that word? We've been getting offers of $24,000 and we owe about 45 on it still.

I wouldn't look at offers. I mean, you sell a private party and you're going to get way more than offers from dealerships.

Okay. Yeah, and so we have two vehicles, and then school loans is another $40,000, and then credit card is probably about $5,000 to $7,000.

You make enough to get student loan debt and get out of the credit card debt if you didn't have the car payments. But your car choices would have sunk you, not your house.

Okay.

Sell the truck. Sell the truck. Okay.

What are the payments on those cars?

My car is a 300-about $76, and then his truck is about $752 every month.

Goodness, gracious. You'd free up $1,100 just by getting rid of these cars. Wouldn't that change your life?

Yes, it would.

Could you pay off some debt with an extra $1,100?

Yeah, we could. Right now, we've been throwing a thousand to debt every month, but it just gets me angry every month that we're throwing it to debt.

You asked about selling the home. George is right. Not before we sold both cars and we work a hard plan with driving a couple of hoopties, working extra jobs. Okay. What's the nature of the MetLife settlement? What's that from?

It's from a car accident that I had with my family when I was younger. I was about four years old. My brother died from it. My parents were gracious enough to separate the money for us once we hit 21. At 21, we received $50,000, which I paid another portion of student loans at the time because I had gone to a private institution. That went to student debt, but then I still had the $40,000 pending. When does it come? When does what?

I'm sorry. When does the 40 come?

The 40, like the school loans?

That's what I have right now. No, the $40,000 worth of student loans pending. I'm sorry. Is the rest of the money coming from MetLife? A monthly money or a bit.

Of sum? Yes, no, monthly money. I'm getting $2,429 for it every month. For how long? When I turned 35, so I have about nine years to go. Okay.

All right. Yeah, you guys need to get... The truck is glaringly absurd in your numbers. It's the thing that sticks out and screams stupid. Okay, thank you for that. Yeah, it's got to go. It's out of control. I'm probably your car too, but at least the truck, because you're making 90K driving a 60,000-hour truck. It does not make sense. Nice truck, though.

Yeah, he's not going to like to hear that day, but he's.

Going to hear it again. Guess what? He's not homeless. He's just truckless. It's a.

Better choice. The fact that he'd rather sell his house before his truck tells me that truck is an ego play.

Yes. Okay. All right, well-.

Yeah, good luck with that. I hope you talk him into it because that's what you guys need to do. Have him watch this call. It's the best thing that you can do. You've got to clear this up. Goodness gracious. Yeah, I remember. If your truck payment's bigger than your house payment, you might be a red neck. I could... Yeah, it could be. That's possible. Rachel is in Canada. Hi, Rachel. Welcome to The Ramsey Show.

Hi.

Hey, what's up?

My husband and I have an opportunity to look at taking a greenhouse business over. However, I don't have a single idea of what questions to ask when we go in to talk with them.

Why would they let you take it over if they're making a profit? Why would they not sell it to you?

He is on remaining in the business for a little bit longer. He's the fellow that's going to work until a dying day. The owner? Yes.

Okay, how are you taking it over if he's still working there until his dying day?

He wants to train somebody up into his position, somebody that's passionate about it, but has a vision to take it in new directions, and for a couple of how him and his wife were when they first.

Started it. When will the ownership be transferred to you?

These are all questions that I have for them. We have talked on and off throughout the on-season, and so it's been very, very short conversations. Now I want to actually sit down, talk with them. What did.

They expect? What I want to know does it make a profit? Because I got a feeling it doesn't. I want someone who's passionate about it and willing to work for no money because this is not really a business, it's a hobby.

Fair. He's been doing this for 22 years. He's well established in our area. Now he's just getting old and doesn't want to do the really long days anymore or anything like that. So it does make a profit.

I want to know how much and I want to know what the business structure looks like. You got to get in and learn all the business aspects of it and determine if you want to take it over. Sounds unusual, and when something sounds unusual, there's a reason it's unusual. This is The Ramsey Show. Folks, changing your family tree takes more than rice and beans and side hustles. It's also about transferring the big financial risks off your family by having the right kinds of coverage in place. That's why my team created the coverage checkup quiz. It only takes about five minutes to find out what types of insurance you need and don't need to protect your finances. Make this quiz one of your regular checkups starting right now at ramseysolutions. Com/checkup. That's ramseysolutions. Com/checkup. George Camel, Ramsey personalities. My co-host today. Abigail is with us in Charleston, South Carolina. Hi, Abigail. How are you?

I'm all right.

How are you? Better than we deserve. What's up?

Well, it's a bit of a financial question as well as a relational question. My husband and I got married three years ago. We've been renting for quite a bit, and then we went up near family and they offered to sell us a house. Well, my mother-in-law is very controlling, which is the relational part of the question. She controls everything and has the codependency issues where she will go and she will buy something for you, even though you're going to buy it yourself and you didn't want her to buy it. Or, for instance, the house that they were trying to sell us. She bought it. Now we're working on it.

Which is absolutely bad. Let me stop a minute. Did you guys buy this house or not?

We were going to.

Okay. You've not bought the house.

No, we haven't. She has.

Okay, so you're not getting that house. What are you going to do?

Well, right now we're working on it.

Why are you working on her house?

Because we're supposed to be buying it from her.

So you agreed to buy it later?

Yeah.

Is this in writing or is this just a handshake agreement?

It's a handshake agreement, really.

Okay. When you buy it from her, what does that look like? You go get a mortgage and you purchase the house and then you're the owner, right?

Yeah. What I was wanting to do was I was trying to get my husband to agree to get a mortgage and then come on top of that to do repairs. Well, we need a contractor for that. My husband's bucking and kicking to not get a contractor because he's supposed to get his contractor's license soon and he doesn't want to put us further in debt.

What does that have to do with your mother-in-law?

I don't know how to approach her.

Why does she need to be approached?

Well, because we're living with her right now. She's living with us. We're both living with her mother. What? She has her own home. She just refused to go home.

What do you guys make?

My husband started a new job in June doing HVAC. Right now, it's up to 2,000 every two weeks, so 4,000 a month.

How old are you guys?

He's 39, 23. We've got two kids.

You're staying home with the kids?

Yeah.

It sounds like the first order of business to create some reasonable relational boundaries is to create some physical separation. That's how- You guys need to go get an apartment tomorrow.

That's what I was thinking. But I don't know how to talk my husband into that.

Well, then you don't have a mother-in-law problem. You have a husband problem. Maybe the mommy's boy needs to take care of his family instead of his mommy's wishes.

She got three sons. She does this to all of them.

I'm sorry?

She has three sons, and she does this to.

All of them. She didn't do anything. Are they all living there? She didn't do anything to him that they didn't let happen. I don't think she's the problem. I think your husband is.

Any boundary you try to set, it immediately devvolves into yelling. Move out.

Move out. Tell your husband, I'm leaving. I hope you come too. Me and the kids are getting an apartment. This is untenable.

If she chooses to end the relationship over this, that's on her. It's not on you. But this is not a relationship, anyways, to begin with.

This is not your mother-in-law's fault. This is your husband's fault and your fault. You agreed to move in with her, and you knew this before you moved in with her.

Yeah, I thought she'd go home.

No, you didn't.

No.

You didn't. You knew exactly what you were dealing with, and you chose to ignore it, trying to make a financial deal. We're trying to save two dollars, and in the middle of it, we're putting up with the wicked witch of the west to save two dollars. You guys need to go have a life. You and your husband go build a life, and you can love her. She's a lot easier to love from a distance.

Yeah, that's right.

Yeah, she needs some distance, but she's not the problem. You and your husband are the problem. You guys just stepped up into a bear trap, and then you're bitching about bear traps.

Yeah.

Yeah?

Play.

This out. You get an apartment, she's mad.

I don't even.

Care about her. That's it.

She's not relevant in the discussion. You guys need to decide we are going to do things that are smart relationally and smart for our future and not put ourselves in untenable, toxic situations to save two dollars. Whether it's working on the house without a contractor's license or buying a house from this woman who's controlling, why you enter into a deal, why you go along with entering into a deal with this woman to buy a house from her is beyond me. These are people that are best kept at arm's length, not right up close. You know this. Now, you're only 23, so I shouldn't fuss at you. But you call me and you're all talked out about her. I'm telling you, you and your husband can solve this.

Yeah.

But she's still mothering him, and he likes it. Yeah. Yeah.

She pays for just about everything.

Well, quit taking her money. I'm not taking your money anymore, and you're not controlling my life anymore. You don't have to be mean about it, but just be kind and just go, Listen, we've made some mistakes by setting up our relationship with you early in our marriage, and we're going to have to change that. Here's the thing. We're going to have a little physical separation, a financial separation, and a real estate separation from you. Mom, you need to get that house on the market and get it sold. We're not buying it. We're going to go rent an apartment and we're going to save up some money, and get us a house. It's completely clean. She's not going to like it. But I'm not taking a poll here. She doesn't get a vote. The problem is you all gave her a vote. Yeah. Again, you don't have to be unkind. You just be very firm and just say it. If it devolves into yelling, that's on her. But I don't put up with people yelling. That's ridiculous.

Yeah.

I mean, what husband is going to let his 23-year-old wife get yelled at? Come on, man. Tell them to run down to Walmart and pick up a backbone. They're on aisle three.

Abigail, this is not going to be fun. What's going to happen when you say all this to him? If he watched this callback, what would his response be?

Would.

It be, They don't understand. It's not like that. She doesn't give me an allowance. It's different. Is that what it would be?

He'd be arguing with the recording and, Well, we shouldn't get an apartment because we're getting it from my uncle. What's he going to say?

Stop taking things from your family. There are strings attached and it doesn't end well. Start your own life. That's what I always say. Don't back out of this deal. Stop taking an allowance. If you all need to go make more money, then go do that.

The financial incest in this is unbelievable.

I know.

I mean, really.

I don't know what to do.

What you do is you have a marriage problem. You and your husband need to separate from these people far enough that they don't have any apron strings or wallet strings controlling you. Get an apartment. There's apartments in Charleston, South Carolina, nice ones. Go get you an apartment. You go get a job, he go gets a job, whatever we got to do to make it on our way. We're a young married couple. We don't have any money. We're trying to get started. But you don't have to live under the thumb of the control of these toxic human beings. Really, it needs to stop. You asked, and that's what I'm telling you. But really, you can't blame her anymore after today. If you want to blame somebody, get you a mirror. It's your fault after today.

Those are also at Walmart.

Yeah. Ila-4. Yeah, they're right over next to the backbone aisle, the mirror aisle. Yeah. And you guys got to make some decisions here. Mama don't get to control you unless you allow her to. You're like grown people and stuff. This is The Ramsey Show. Hey, folks, it's Dave Ramsey. And Rachel Cruz. We want to tell you our number one tip for managing your money well. I'm talking about budgeting. Yes, and everyone knows that I am a huge fan.

Of.

Budgeting. Well, that hasn't always been the case, though, has it, Rachel? No, but listen, I seriously love it now because as soon as I started making a budget, I learned that it puts you in control of your spending. And my favorite way to budget is on our app, Every dollar. Yep, every dollar makes budgeting simple. It's the easiest way to make a plan for your spending so you can prioritize the things that matter to you. And you can get started today for free. Just download the app and check the show notes for the link. And you guys don't wait to start budgeting. Download every dollar and create your free account today. Do it. It's the best. George Camel, Ramsey personalities, my co-host in the lobby of Ramsey Solutions on the debt-free stage. Emmaeus and Hannah are with us. Hey, guys, how are you? We're good. How are you? We're blessed. Welcome. Where do you guys live? Charlotte, North Carolina. Awesome. Welcome to Nashville. How much debt have you two paid off?

94,000. All right. How long did this take? 18 months. Good for you. And your range of income during that time?

Whenever we first started, we're making around 97,000. This year, we'll file taxes around $180,000 to 200.

Whoa. What do you all do for a living? I am a nanny, and I'm also a house cleaner. I started that business when I was in debt, so I was cleaning houses, got my clients, and.

Scrubbed toilets. Good money.

From morning to night. Good money. Good money.

Yes. I run a video production company. We film weddings, corporate events, commercials, and my wife helps me as well.

Wow, you guys are working hard. We try to. Where did you go? What debt was the 90 for?

We had a car for 37,000 for around 52,000, and an iPhone 12 for 599 bucks, which we paid off first.

How long have you guys been married? This December will be two years. Okay, so about the time you get married, you start this stuff. Tell me about it. How did you get connected up to the Ramsey deal? It was a couple of months after we got married, we gathered up all our debt and we said, We got to get this out of here. We started listing them from smallest to.

Largest and trying to pay them off.

As soon as possible.

We did, because as soon as we got married, I was like, Man, we're making all this great income. We have all this money coming in, but the checking account is staying the exact same. Where is it all going? It was going to a stupid dealership. It's going to stupid federal student loan programs. It's going to Verizon, and it was going to all these places. I said, I work way too hard to have this little money in my checking account. Just like you said, Dave, something had to change my life so I could actually change something for my future and have more than a couple of thousand bucks to my name making that much money a year.

Amen. Preach it. How did you guys find us?

One day I followed you on Instagram, and then you eventually recommended on YouTube. I was like, Man, some of these people are I can definitely relate to. I was like, Man, making all this money, not having a lot of money or having some of these stresses, I followed you. Then a few months before we got married, we cut up all of our credit cards and we said, Okay, we're done borrowing money. Even though once we started paying off debt, we accidentally fell back into it. Then I had to repent for about the next year because of that. But even throughout that whole process, we just kept on following you on social media and YouTube and love your content. We went to go see you in San Antonio, Texas, at your Building Wealth Conference. We led FPU a few years ago and then also purchased your Financial Coach Master Training, to help coach other young people on how to become debt free and.

Achieve their goals. Wow, you guys.

Are on fire. Fully in this thing, man. That's impressive. Along the way, you guys doubled your income. Was that just because you are furious about the debt payoff and then it just stuck? I got so mad at it. I said, It has to go. Because, for example, within our video production company, we film weddings, then we edit weddings, and whenever we were in debt, I said, Well, I can make more money editing weddings for other people. I stayed up late 11:12, 1:00 AM, sometimes editing for other people. Then once we started doing that, a lot of people started sharing the word about it. Dave, just like you said, in a small business, if you just show up on time and you do a great job, you won't have any competition. That's what we started doing. Then we're now starting to hire other contractors to help us throughout the process, and our company grew actually because of the intensity that we achieved through Baby Step Two. It just overall helped our business as well as pay off debt. Wow.

How old are you, two? Twenty-three.

Wow. I was 22 when we made our last debt payment, just turned 23.

Last week. Wow, congratulations. You guys are heroes. You have the whole rest of your life to live with intentionality and with a big old pile of cash because it's not going to payments. Yes, sir. Yes, sir. You all are amazing. Very, very well done. All right, financial coach, what do you tell people the key to getting out of debt is?

Ever since the beginning, we tied 10% on our income to our local church, and we were also extremely generous throughout the process. We did tiptoe in the baby step seven sometimes of just being extremely generous throughout the process, because generosity is so much fun, in my opinion. We kept on tithing 10%. We sowed seeds with other organizations and people. We're extremely generous, but also we worked together.

You worked.

We worked all the time. All the time, we're generous, but we made sure that we were in communication with each other. We didn't go spend money behind each other's back. We were completely on the same page. There were some nights I was editing on the couch at 11:00 PM while she was doing editing on her laptop as well, and we worked all of the time.

Yeah, and now you've got no debt and you're 23. Besides her house. Yeah, not waiting on someone else to clean up the mess. Exactly.

That's extra weird. See, most 23-year-olds out there, they're going, Well, it's the wages, and they just don't pay enough these days, so I can't get ahead.

It's the boomers fault. It's the boomers. Because we bought.

Cheap houses. It's the guy in the White House. You guys just went, Wait, we can make more money. We're not scared of work. Now you control your own destiny in that way. I sometimes scrub toilets with her. She was like, Hey, May I- Just for fun? No. She said, I must have a 3,000 square foot home. I said, I guess I need a pair of gloves as well. I'm helping you. As soon as I close the laptop, I'm picking up the toilet scrabber. What's the average amount you can charge for a house for cleaning?

$150.

That's amazing. It takes a few hours. Oh, yeah. Two or four hours. She sometimes did two or three in a day. Then editing, what can you get paid to be editing other people's weddings? About $500 to $800, and for a wedding video between 3,000 to 5,000. What does that hourly come out to? I can do a $500 edit in about three or four hours. Wow. About $100 an hour is something I can do anytime throughout the day and just work really hard and be generous.

That's amazing. You don't have to just sit in doomscroll. Instead, you add it.

Oh, yeah, we would make 50 bucks, 100 bucks just doing these side hustles turned into a business.

Yes, sir. That's right. That's where money comes from. Amazing. You got to work. Yeah, God. I love your parents. I don't know who they are, but I love your parents. They're right here. Great job, mom and dad. Proof that if you teach a kid to work, you really don't have to teach them much else, so figure it out.

Every parent listening is like, I wish Johnny was more like him. Really?

The 23-year-old we were talking to a while ago with the mother-in-law is you. Yes. Yeah, a whole different 23-year-old is here. Oh, she's still listening. This is a whole different thing, man. Amazing. Well done you two. Very, very well done. So proud of you. Thank you so much. Who was cheering you on as you went? These lovely people over here. Moms and dads? Yes, they were supporting us through it all. They think you were a little crazy, though? A little bit crazy, yeah. Sometimes, yeah. You all are a little crazy in such a good way.

You guys are still editing. You guys are still cleaning houses and babysitting. You should have two or three cleanings in a day then babysit at night. I won't see her all day, so I said I'll either be bored, I'll miss her, so I might as well work. We're just working at the same time. All of a sudden, we just noticed our spreadsheet, Baby Step Two just kept on dropping lower and lower and lower. We said, Oh, my goodness, we're out of debt and we actually have money. Because we're not giving it to people anymore.

Boom, just like that. You guys are fun. Well done. I'm so proud of you. Thank you so much. You've got a neat young couple. Your future is so bright. It's unbelievable. Fabulously done. We've got the live and give box to give you. That's the Baby Steps Millionaires book. You're going to be there in 20 minutes. You'll be millionaires before you're 30 the way you're going. This is crazy. Total Money Makeover book as well to give to somebody that's inspired by you, and you are inspiring. The Total and the Financial Peace University membership as well. So very well done you guys. Wow, power couple, baby. I'm impressed. Mic drop. Emmaeus and Hannah, 23 years old Charlotte, North Carolina, 94,000 paid off in 18 months, making 97 to 200. What's their secret?

Work. All the time.

Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free. Yeah. Yeah, yeah, yeah, yeah, yeah, yeah. Love it.

Boom. I wish I could just bottle their energy and sell it. That's impressive.

Gen Z Red Bull.

Right there. That's all you need right there. We're going to call it. Talk to Emmaeus and Hannah. We're going to call it. I may have just given them their next business idea.

Here's the thing. Somebody's going to watch this and say, Well, I don't really want to work then. Well, then don't bitch about not having the results.

Yeah, if you want those.

Results- If you want the results, you'd put in the time. If you want to win the Super Bowl, you got to practice. You got to play hard every down. Even between the plays, you got to be working. I mean, you don't achieve excellence without getting it. I mean, they got it. Get up, leave the cave, kill something, and drag.

It home, man.

That was the key.

Very powerful.

Nothing stopping them. Unless you're willing to do what they do, don't whine about what they did and what they got. They got out of debt in a short order. As soon as they got married, boom! Just like that. This is The Ramsey Shell. Our scripture of the day, Isaiah 45:2, I will go before you and will level the mountains. I will break down gates of bronze and cut through bars of iron. Henry Ford said, When everything seems to be going against you, remember that the airplane takes off against the wind, not with it. Spoken like a car guy. But it's actually true.

I just kept thinking they had planes back then.

That's impressive. They did by the time he died. Yeah. All right, Sean is with us in Louisville, Kentucky. Hi, Sean. Welcome to The Ramsey Show.

Hi, Dave and George. Thank you for taking my call.

Sure. What's up?

My wife and I are looking into upgrading in home. We currently live in 1,500 square feet and we have three kids, seven, five, and six months. And with school choice looking at the location that we would be moving to, our expenses would be staying the same, but we'd be moving from 1,500 square feet to 4,500 square feet. The question I have is, though, and I guess the concern I have is, yes, we'd be taking on more debt for a mortgage. But again, with the school choice, it would allow it to be the same expenses.

You mean not paying private school?

Correct, yeah. We'd be still sending them to private school, but we wouldn't have to pay that expense because of the school choice.

You mean the school has a voucher program? Correct, yes.

Okay, so you're moving into an area that has a voucher program. You could use that towards your private. It would save you that tuition. Yes. Okay. But your house payment is going to be how much?

The house payment, we're going to do a 15-year. It would be 2,500 a month.

What's your take-home pay?

The take-home pay monthly is 9,300 a month after all of that's net.

4.01k coming out before that?

Yes, correct.

I would do this. It fits every guideline we talk about.

Yeah. I guess the only thing I had a little hesitation about is I guess if it ever wasn't like that, if they didn't have that policy in place.

You're moving to a different county and the county that you're moving has a voucher program. How long have they had the voucher program?

For over 10 years. Okay.

Do you have anything in the political winds that makes you think it's going to go away?

I don't think that state, I wouldn't think. But you know.

Well, I mean, you can't tell about anything for sure. I'm not saying, but if there's something in the front cover of the newspaper right now, then yeah, right? Yeah. You're correct, yeah. But if they've gotten a voucher, as controversial as vouchers have been, if they've gotten it in place and have stuck with it 10 years, they sound like people that are going to stick with it to me.

Yes, I think it's benefited them greatly.

Yeah, it's probably good. It's probably done what it's supposed to do, which is actually benefit everyone involved.

Yes.

Anyway, moving along from the politics. But financially, I would do what you're doing.

I.

Think I like it. Yeah. Hey, you know what? If the voucher system goes away in four years, you can move.

Yeah.

This is a house. It's not permanent.

Yeah. One security thing that I had, if it did go away, if there's good schools within that county that we could fall back onto if we absolutely had to. I just, was-.

Well, and the other thing that's going to happen is during, let's say it's five years from now, six years from now, your income will be up.

Sure.

Yeah. We're not dealing with static income.

What's your new mortgage going to be? $2,500. What's the loan amount?

The loan amount will be right about $300,000. Okay. Oh, I might bring it down a little bit more. We have a little more than $100,000, say, to put down on it. I have over 130,000 equity in the house that we currently live in now.

Okay, so you're chunking 230 into it already. The other thing you look up, I mean, inside of 10 years, you may have it paid for, but you're not going to need it but for 10 years more. Well, you got the little one. But the school is not forever, but it's-.

That's what I kept thinking the.

Mortgage isn't forever. -if you get 10 good years out of this, you've knocked most of the issue out. Between your income coming up, paying off the mortgage, or getting close, you got all kinds of options if the thing breaks down out there 8, 9, 10, 11, 12 years from now, and that would be only dealing with the baby then.

Yeah, we've seen the average it takes for folks falling the baby steps to pay off their mortgage of seven years. If they do the 15, so you're going to be right there, man.

It would not surprise me that you were not debt-free in 7-10 years, house and everything, which again, changes the whole equation if the school thing turns upside down on you. That's pretty cool. Pretty cool. Misty is in Los Angeles. Hi, Misty. Welcome to The Ramsey Show.

Hi, guys. How are you?

Good afternoon. Afternoon. How can we help?

I just started listening to you guys a couple of months ago, downloaded your app, getting ready to launch it. I am in quite a bit of debt. I do have a savings. I wanted to get your advice on, shall I dip into the savings, pay off my debt, like what you guys state with your baby steps? Sure.

Sounds fun to me. How much debt have you got?

I got about $110,000 worth.

Of debt. How much in this savings?

I have about 260, 5,000.

What would be wrong with writing a check tonight and being debt-free?

The only hesitation I.

Have is- You'd only have $160,000, Mesty. I think I'm going.

To cry. Wipe your tears with $100 bills.

My thing is that years ago, I paid off debt before, and I just re-rent, got a go on this. I'm trying to fix my core.

Because I'm- That's a good reason. I like that reason.

Okay. As silly as it sounds. I mean, I'm smart. I'm a very, how old are you? I'm 46 years old. I also own a house, but I don't consider that-.

Is it paid for?

-i have more debt. My house is not paid for, and it's funny in a sense. I have two homes. I have one home I own in Arizona that I'm paying a mortgage on, and my job is in California, so I do rent. Oh, okay. Okay. Yeah. It's more like a retirement home I've been paying off, but it's in a pretty good shape.

How long would it take you being on a budget on the every dollar budget app that George shows you how to do it? How long would it take you to feel confident that Misty is not going to ever go back into debt? How long would it take? I mean, how many months of doing a budget consecutively where you had power over money instead of it having power over you, how long would it take for you to build confidence in Misty?

I don't think very long. I don't either. Yeah, you got me analyzing. I started seeing where my money was going. I started making some serious changes just in this last month after listening to you, like you said, every dollar.

I've been doing this 30 years. I think you're okay. I love that you are concerned about not changing your behavior and going back into the hole. That is a very wise lady that says that. The fact that you said that out loud probably means you're okay because you're attacking this, you're addressing it. The subject is now, it's actually interesting to you for the first time. I'm going to make this stink and money behave so it doesn't all get away from me. I don't like this feeling of chaos and being out of control. I want to be intentional. That's risen up in your throat, hasn't it?

It has, but my question, right now I take home about $11,500 a month, sometimes $12,000. But bills are 95.

Yeah, but you're debt-free because we just paid it all off.

That'll free up some payments, which is only going to help your budget. Like you said, a budget is just paying attention to your money. Go sign up for our free webinar we have going on everydollar. Com/budgeting. There's one coming up over an hour, we're going to walk you through how to use it. You said you downloaded it, haven't launched it yet.

We're going to give you three months pre-premium, too, to get started on it. Because I think in three months, Misty is going to really feel good about Misty.

It takes 90 days to.

Dial it in. If you don't write the first month, write it the second month. If you don't write the second month, for sure, write it the third month and be debt free. I think you got this, kiddo. Hang on. We'll help you and get you signed up. That puts this hour of The Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of peace, Christ Jesus.

Hey, it's George Camel. If you like what you heard in this episode and want to know more about getting started on the Ramsey Baby Steps, go to ramseysolutions. Com and click on the Get Started button. We'll help you figure out the best next step for you based on your specific situation. That's ramseysolutions. Com, and click Get Started.