Live from the headquarters, Ramsay Solutions, it's the Ramsey show, where we help people build wealth, do work that they love, and create amazing relationships. I'm George Campbell, joined by doctor John Deloney. That's Doctor Dot, if you're wondering, two phds, bestselling author talking about relationships and emotional health, host of the Doctor John Deloney show. He's joining me this hour to help you guys take the right next step for your life and your money.

And my most important title, George Campbell's best friend.

I like that title. That's how you got hired on the resume.

It feels right in.

My doctor was further down. George Campbell's best friend was first.

I got passed through three interview levels, which means here at Ramsey, I only had 17 more interview levels to get through, which is awesome.

It is intense, it is rigorous, but it's how we get high quality people like Jon through the doors. We are here for you. The number to call is triple 8825-5225 don't be shy. We will be happy to give you our best advice. And it's our opinion, and we are experts on that. At the very least, very least, Ted is kicking us off in Des Moines, or as some of my friends call it, Des Moines. What is going on, Ted?

Looking for some advice on a potential car move I got to make. I've got an aged car at about 2010, and I need to either purchase a vehicle or lease one through my business, which is what both my tax professional and my lawyer were like. Hey, that would be a great tax advantage. It's a good idea for you. What should I do?

Well, I mean, it comes down to, do you want to listen to your accountant and lawyer or just two guys hosting a financial call in show?

Well, I know how Dave feels about. I mean, that's kind of. That's kind of a given at this point. But I just don't want to do stupid with some zeros on the end of it and just look at that and go, oh, yeah, I should. At least the car. Or, oh, yeah, I should have just bought it outright.

Do you have a dollar amount on the tax savings?

No, I don't.

That's one of those phrases that folks throw around like, you shouldn't pay your house off because you can write the house off. And people don't lay that up against the monthly mortgage payment and the tax and yada yada. They pay the interest payments they make. This is one of those moments that I would wonder, and I'm making a purely math argument here, and we'll talk about the psychology in a second. I wonder what the actual tax savings would be versus the depreciation of the leased car, because that's what you're paying.

When you lease a car. You're pre paying the depreciation plus other fees.

You're giving a gift to the car dealership because you are paying the depreciation of the vehicle they have so they can turn around and sell it as a. As a inspected, like, super used car that some yahoo just paid our depreciation for us.

An apartment on wheels. Right.

Well, my further question is, why is your lawyer telling you to lease a car? Where does that come into play?

I understand my lawyer keeps me out of jail.

That comes into play. It's my business lawyer. And we have a relationship, and that was kind of an in passing thing.

Okay. You're like, hey, what do you think about this?

Yeah. So it wasn't like, this is your legal advice. It just happens to be people on my team. And I was like, maybe I'm missing something.

What's your business?

I'm a photographer.

Okay.

Greatest call I've ever had.

What is the gross revs and profits in a year.

Right?

Around 400,000 is your gross revenue?

Yeah.

And what do you take home? What's on your tax return?

About a quarter of that.

Okay, so you're bringing in, let's say a quarter.

Really? You have 300. Like, you have 75% expense on a photography business.

You have a big team.

No, this is what I pay myself.

Okay, so there's more profit. Are you reinvesting that? What are you doing with all the extra profit.

At the moment? I've made a bunch of physical moves in the business, changed locations. I mean, there's just a lot of moving pieces at the moment.

Do you have any other debt?

And I'm just looking at just the house.

Okay. Are you married or single?

Married.

Okay. What does your spouse think about this?

She made that grimace face when I brought up the lease conversation because I wanted her input. Of course. I think she's willing to do whatever is most advantageous for us, but at a glance, she was like, well, let's get the estimate on the car first, see if it's worth putting some money into to make it, you know, kick the can down the road so we can buy a car later.

What's the.

What's the necessity of having this new car?

Something safe for her. Something safe for her and my son to get around in.

Okay, so this isn't really for your business anyways.

It's not, but the vehicle that I currently use on a daily, she would take over and then we could lease it to the business and I would use it for business because you have.

To use the vehicle 50% of the time in order to even have any tax advantages from that lease.

Oh, absolutely.

So I just think you're going to make a very different decision if I just said, hey, how much cash do you have on hand to purchase a used, reliable car? Versus, hey, what's the sweetest, shiniest whip you can go lease at the dealership? Those are two very different conversations. And that's really the heart of this is you're going to make a much more, just put it bluntly, a stupid decision if you lease that car versus buying one with cash that you actually have. Okay, usually people say, wanna lease a car for business? They want to drive something super flashy that's gonna attract clients or buy like a 9000 pound thing they can depreciate and write off on the taxes and get a g wagon. And it's generally stupid decisions pumped up by Instagram gurus.

So we are not. Yeah, we are definitely not. No, I'm not looking for that.

You're a guy who wants a reliable car for his family. And we've, we've both been there. And every time, regardless of our business and tax advantages, we just go, what is the car we can afford in cash?

And you made $400,000 last year. You've got 40 grand to buy a car. Right.

I agree. Yeah.

You have the cash.

Doing that. Doing that today if I needed to, is that. I'm not worried about that. If we needed to do that today.

So here's what I'm going to tell you as a guy who's not nearly as sophisticated as george is when it comes to the math on all this. If I own a small business, which is what you have, you're very successful at what you do. I mean, you're in the 1% of the 1% of photographers. Everybody wants to get into it and very few people make it, and you are out of this world successful. I would still be haunted by how many outstanding liabilities I have as the only guy with the line in the water. And I don't care what the tax savings would be, I would pay it as a sole tax. That that is my car and my business can go in the toilet, the economy can tank, and my business can go from 400 grand to 35 grand in one year as a photographer and nobody can come take that car from me, whereas I just signed a three year lease agreement, and those payments are coming out automatic withdrawal no matter what, how much money I'm bringing in. And the tax savings simply is not worth the sleep tax it would cost me.

I don't disagree with you. Maybe my question should be, do I need any tax person lawyer?

No, I think your tax person's giving you tax advice. And the tax, the tax accountant is going to say, here's all the things.

You could take advantage of.

That's right. And because you probably sat down as a small business owner and said, all right, help me. And they're trying to cut your tax bill. Here's a way to cut your tax bill. Here's a way. And I think you look at your tax account and say, I don't borrow money ever, period. And if they bring it up cool, and maybe then if they're trying to get you to do something outside of your wheelhouse or outside of your values, then, yeah. But no, I don't blame. I mean, George, I don't blame the tax.

I don't think they're a bad person. Yeah, they're doing their job. And if you want to get a second opinion, reach out to a tax pro that's Ramsay trusted. Go to ramsaysolutions.com tax and say, hey, what do you think about this? And I'm curious if you get a different opinion, but I don't think this is going to bless your life in the way you think it does. There's other ways to get deductions, better ways to skin this cash. That's my final take, John. This is the Ramsey show.

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Welcome back to the Ramsey show. I'm George Campbell, joined by doctor John Deloney. If you guys missed it, we have a big announcement this week. The live, like no one else, cruise is back. Don't call it a comeback, but it kind of is because five years later, we're bringing it back. Join Dave and all of the Ramsey personalities, Jon and I included, for seven days at sea, March 22 through the 29th of 2025. So we're less than a year out. On top of all the Ramsey personalities, we have some amazing musicians, magicians, comedians. Comedians, you name it. Songwriters. They're all going to be with us. Stephen Curtis Chapman, mineed Chohan, Dina Carter, Steven Bargetsi, Nate Bargetzi's dad, amazing and hilarious magician will be there. So here's the thing. This is not for everyone. This is for those of you who have been working the Ramsey plan. You've gotten out of debt. You got the emergency fund, you're in baby step four and beyond. That's who this is for. This is the ultimate debt free celebration. We're going to be taking the entire, taking over the entire cruise ship. Imagine that, John. All Ramsey fans. It's going to be electric.

It's a lot of Ramsey in one.

Lot of Ramsey. It's going to be a hot time. Literally, it's going to be hot, I think Turks and Caicos, St. Thomas, San Juan, the Bahamas. And it's gonna sell out because the last one sold out in just a couple of weeks. So vip upgrades already sold out. You can join a waitlist to see if a spot opens up, but you can book your cabin now at Ramsey solutions.com cruise. And I've been getting DM's about this. People wanna know, are kids invited? And so I found out from our live events team they are, in fact, invited.

No kidding?

Yeah.

I did not know that.

So it's kid friendly. If you wanna bring your teenager, you know, your toddler, whatever, they're welcome aboard, too. So tell your friends. Make some friends if you have to. Join us for the Ramsey cruise, Ramsay solutions.com cruise. All right, Seb is on the line in Atlanta, Georgia. Seb, what is going on?

Hey. So I am trying to find out if right now is the right time for me to finish my bachelor's degree in engineering. I got my two year degree and got into the workforce to work as an engineering technician. I'm married, have a one and a half year old. We have a very, very low cost mortgage in rural Georgia. And my employer is encouraging me to use the $5,000 tuition reimbursement plan to get back to finishing what's left of my bachelor's degree for that promotion and moving up in the company. What that would look like is probably taking out some federal aid and having that reimbursed every year at the federal tax limit that my company offers. I just don't know if right now is a good time because I am paying back some current student loans, but I would like to finish my degree sooner rather than later.

I think you. Everything you said is, for me, is an all steam ahead, except I don't think you have to take out the federal loans, okay, either. A as your family, I'll figure it out. If it's reimbursable within one, like, one paycheck cycle, if that's how they roll, and I know some companies do the other way around, it is. I think you sit down and ask your boss, say, hey, you know how much I make? You know, I've got a one year old. Can we prepay this if I hand you the bill, right, versus getting all tangled up in the finance mess? Because here's what's going to happen. You're going to take out a loan, they're going to send you $7,500. You're going to put 5000 down, and then they're going to say, it'd be cool if you had this program. And you'll be like, I'll just buy that program. And then your transmission will fall out of your car, and your boss will reimburse you $5,000, and you use $3,500 of that on your transmission. And I know this because that exact thing happened to me sounded personal. It was very personal. So I would not trust myself with federal aid money just floating around because it's real easy for all that to just go away.

But an engineering degree, you have a boss looking at you saying, this is going to help you move up in this company. It's going to help you. And I'm willing to put some skin in the game and contribute to this. I would pause, George, tell me if I'm wrong, but I would pause paying back my student loans and knock this bachelor's degree out once and for all and let that be a rocket ship for you. Professionally.

What is your total debt?

Currently I have $23,000 in student loans. Over the course of the three years and some change I was working. I ended up working full time. I got married while I was in college and got into the workforce because experience in engineering matters and I wanted to have some experience while I was in school. So now I'm trying to just round it out and get to that accredited engineering position.

So what do you make now?

Right now I make about $68 to $69,000 a year. Right in that range.

Cool. And you have no other debt other than the student loans?

We have a mortgage of about 1200 a month, all inclusive.

And your wife is at home with the one and a half year old?

That's right. Mom's staying at home and I'm working a second job to pay off the student loans.

So would you continue working full time while doing this program nights and weekends?

Yes. I would actually be a fully remote student to finish out the work that's left, because all of that is actually available for me as remote student.

So it'd be no dip in income?

No dip in income apart from figuring out how to pay in advance, the coursework required.

Yeah, man, I would figure that out ASAP and I would. How much do you lack?

I'm about 70% there, 75% there.

So what would. How much total is this going to cost you?

Probably around $15,000, given the estimation that the university provided me.

So 15 grand. And they're going to reimburse five total.

My company will cover 100% of tuition year on year up to the federal tax limit, which is $5,500 a year, approximately.

Okay, so what if you covered the difference with cash and you were able to still do this? How quickly could you save up the difference to get through this first year and then save up the difference for the next year and be done?

I could probably keep rolling it in at the rate that they will reimburse it.

Okay, so how quickly would this all.

Happen into the red? This would probably happen within a year.

Year and a half, and you'd be done completely. And this would increase your income exponentially. What's on the other side of this for your career?

I would move to holding a position as a project engineer, which is a project lead position, a more senior role, and a range of about $20,000 annually increase.

So you could be making 90 if you finish this thing?

That's correct.

Yeah, this is. This is as no brainer as they come.

But here's the key. You have to do all this aggressively and you're not touching debt. That's the agreement. Because the faster you do this, the faster you save up cash, the faster you get through the program, the faster you make more money, the faster you get out of the rest of your debt and you're home free. But we don't want to look up and have 15 more grand on top of the 23. And there's going to be no lifestyle creep. You're going to keep living the same way even when you get that raise, right?

I mean, we're staying in the green right now, and I'm working a second job to pay off those student loans. So it'd be nice to go back into school and everything goes into forbearance once you become a student again. As it stands, yeah, I think this.

Is a good plan. If you do it without debt and you move as quickly as possible, you don't want to drag this out, because we want to see all of that debt gone on top of not accumulating any.

And, John, this is. It's a big.

This is a big thing people grapple with. Should I go back to school? How do I do it? How do I cash flow it? What would you say to people coming from that world?

There's a couple of things. One is, if you are 70% done, finish your degree. I've never. I haven't met somebody yet. Um, and, of course, I worked in higher ed for 20 years. I've obviously got a bias here. I've never met somebody who went back and finished and said, I shouldn't have done that. I've never met that person. I've met people who said I shouldn't have got this graduate degree. I shouldn't have gone to college, period. I've never met somebody who's 70% done that's like, have done that. The second thing I always want people to do is go ask your employer if they'll help out, and this guy's employer will cover all of it. And that makes it a no brainer for me. And when people say, well, I can't do this, I can't. Outside of med school and law school, maybe one or two other programs, I worked a full time job. I had a part time job. I was a full time associate dean. I was a part time professor, an adjunct professor, and the father, not a great one, of two small kids, a husband, and a full time PhD student. You can figure it out for a few years.

And is. Is it awful? Yes. Does it pay off on the back end if you are getting the right degrees? Oh, absolutely, it does. And so it's. It's just like the gazelle intensity. There's a few years of misery for an entirely new family legacy on the back end. It's when you start taking off federal loans. Just because I'm just gonna go do this right now. Cause it'll be easier and then we'll, we'll settle up on the back end. You get laid off, something else happens.

You need the cash and you don't finish.

You don't finish, you're still stuck with.

They don't want to forgive the debt just because you didn't finish the degree.

That's right. Themselves. Your company has to lay people off until they cut this program out. No debt, just knock it out, knock it out, knock it out. But yes, I'm always a fan of going back and finishing that degree.

Even if you move slower, it's still a better path long term and gives more peace to your family, especially if you've got a stay at home spouse. So we don't want to see a dip in income and we don't want to see any more debt accumulated. That's the key. Thanks for the call, Sab. This is The Ramsey show.

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Welcome back to the Ramsey show. I'm George Campbell, joined by doctor John Deloney. Open phones at 888-825-5225 you call in and we'll help you take the right next step for your life and your money. And hey, while you're listening to the show, it's a free show. May I remind you there's one thing that you could do for us that's also free. It would only take you a moment and that is to share the show, to consider subscribing, hitting the follow button, leaving a kind review, telling people about it. You are the greatest marketing plan we have and it helps our budget because we don't spend a whole lot on that. You don't see big billboards out there. You guys are the best marketing we have just by telling your friends word of mouth. It is powerful and it's working. And we thank you guys. We want to reach more people through this platform. All right, let's get to the phones Maureen is in Palm Springs, California.

Up next.

Maureen, what's happening?

Hi. How are you?

We're doing great. How can we help?

So, I'm familiar with the baby staffs. I try to be a good steward of them, but I seem to continuously sabotage myself. So I just need to know, how can I be more diligent in, I guess, following them?

How do you sabotage yourself?

I make that budget. I am on it every day, checking, making sure I'm tracking my expenses. And then one of the family members that I have have a need, or I personally will be like, well, I guess I can go out of town and go and do that. And so then I have to recalculate everything. And then I push my.

So you're getting stuck on the meticulous numbers, and one thing throws a wrench in the plans and you go, oh, my gosh, I failed again.

Oh, no, I think it's deeper than that. I think the budgets like a. It's like a toy. It's like something. It's just something for you to fiddle with. It's almost like a fidget spinner. But your real identity is, if any family member calls for any reason, I'm the hero and I'll save that, or I'm only gonna live once. And so I'm just gonna go do whatever I want to do. I'm gonna take care of right now, me, and forget about next year. Maureen.

I guess. I guess, well, if the family calls and they need something, I'm going to cut from my budget line that I have assigned for me. I mean, mind you, it's like, minimal for my personal expenses for the month. But why are you putting your oxygen.

Mask on them before you? You're not in a place to be giving right now.

When you say family, are these your children? Is this a spouse? Who's. Who's calling you up, going, hey, we need to spend this.

It's. Yeah, adult children.

Ah. How old are we talking?

30?

Oh, boy, Maureen, I can count on zero fingers how many times I have called my parents for money since I was, I don't know, 20 years old. So this seems to be. There's a systemic problem where they go, well, mom is going to be sweet and send us some money because we're struggling. What do they need at 30? That something they can't provide for themselves?

Well, I'm providing quite a bit for them already, knowing that they live.

Maureen, what do you feel guilty about?

It just seems difficult for them to make that step into independence.

It does. Because their mom won't let them go leave, either.

This sounds like a brilliant plan. I get to live at home for free. Mom pays for all my expenses, and.

Then when I run out of money, I call mom, and she cuts herself off at the knees to keep. Keep my budget going.

Okay, well, I have made some stuff.

She's like, all right, I'm done with you, too.

Yeah, you need some problems. Yeah, you need some problems, is what I've heard and listened to. And so I implemented like, okay, you've got to pay me rent. And so apartment one, you give me 300, and apartment two, you give me 750, is what I tell them. And it doesn't come with any concierge services, so I'm trying to, like, implement those steps.

How old are you, Maureen?

Oh, I'm 48.

What are your financial goals?

To be debt free.

So you still have debt.

Mortgage as soon as possible.

Okay, so you have consumer debt?

I have 15,000. I have 15,000 in debt. Yes. And I have 187,000 on my mortgage.

Okay, hold on. I just got. Sorry, George. No concierge service. As though you'll show them.

Yeah.

What are you talking about?

Check the mail for them. I'm not gonna go run and grab food for them on my way home.

How would that even be in your mind, that you had to say that out loud? They're 30.

Because that's what they ask for.

I think we need a hard boundary conversation and say, listen, I love you guys, and I have loved you too hard, and I have stunted your growth, and that part is on me. But there's a part that's your responsibility, and that is going to live your freaking life. So you have six months to get a plan and get out of this house and find an apartment. And you need seven roommates to start a job. I'm just saying we need a game plan to get out.

Maureen, have you ever gone to a gym and worked out?

Yes. I hate it.

Okay.

Yes, I have.

Here's what you're doing for your kids. They're going to the gym, and they're looking at you saying, mom, I've got to get stronger. I've got to. I can't live my life like this. I got to get stronger. And you said, okay, I'll go with you. And you walk into the gym, and when they lay down on the bench to lift some weights, you run over there and take all the weight off the bar, and they push the bar up with no weight on it. And they're now 30, and they're wondering why they can't navigate the world. They're not strong enough because you keep using them to make yourself feel like you're being a good mom, and that's not their job. Why do you feel this need to keep? There's got to be some guilt you're trying to wipe. I mean, I don't know. What are you trying to solve or accomplish by giving 30 year olds this much support and care? Do they have special needs or they just don't want to work? What's the deal?

No, no, no. Yeah, I just. They're working. He just finished school and he took a pause for a bit, and then his fiance is finishing going back to school. And I just. I told them a few months back when I gave them their rent notice, that they were going to have to start paying rent, that, you know, let's revisit this in June, because if it's working until June, and then, you know, then we'll see where we go from there. But if it's not working, then how.

Far below is $300? How far below? Is that a market? Rent?

Oh, gosh. I mean, that's nothing.

Exactly.

The youngest one, who. Who will pay me whatever I want, and I'm. And this is the thing. I tell them, I don't need your money. I just need you to do your thing.

But they need your money.

It's on me. Yeah.

So, my word. There's a lot of problems here. Number one is that you haven't put your own mask on first. You're going to remain broke while sacrificing for your kids that can't start their adult life. So that's problem number one. And the other problem here is that their growth will continue to be stunted as long as they still have this sweet scenario. And so your job is not to be cruel, but to be honest on both sides and say, I haven't done a great job of doing this. You guys need to step it up. I'm going to give you three months to find a place to live, and I will help you leave gracefully. You don't need to kick him out on the street and evict them. But this is a problem that's gone far too long. I literally thought you were calling to be like, my eight year old needs saxophone reads for band. This is a 30 year old grown.

Adult or a 21 year old or someone about to be married.

No, my youngest is married. And this is where I say I self sabotage myself. Right? I have my plan. My youngest is married. And I said, well, instead of you guys, you know, carrying that burden of going her finishing nursing school one semester, why don't you just stay here for a year and then after that, then go ahead and get your place. And they are. They're looking to buy, but that's going to take them, like, at least another six months.

They need to rent, give them they've been saving.

They can go sign a six month lease, tell them this, and get used to paying their own bills.

I want to be your mom and not your landlord. I want to be your mom and not your bank. And I can't do both. And if they choose, well, we wanted you to be our bank, then y'all need to have that conversation. But I.

Can I ask a hard question, Maureen? What happened to dad?

Sure. Oh, that's a whole other call.

But I think a lot of the things from the structure.

Yeah, no, he's there. He's here. He's here.

But is he?

I don't.

Because it sounds like you've taken on the brunt of all of this, and maybe part of it is because of what's happening with dad and you feel like you need to be the savior and hold this family together.

Well, no, he's here. We're married. I just financially don't do any. Anything with him. I do nothing financially with him.

That seems to be part of this problem.

We start there, and I wonder if you're trying to buy a continued relationship with your kids and you want to ask about why you can't keep a budget because you got a lot of stuff going on.

The budget's not the problem, Maureen. We have to have a lot of hard conversations really soon. I'm so sorry. This is the Ramsey show.

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Welcome back to the Ramsey show. I'm George Campbell, joined by doctor John Deloney. The number to call is 888-25-5225 Carmen is up next in Cincinnati. What is happening? Carmen?

Hi. Thank you so much for taking my call. I appreciate everything you all do to help people. Thank you. So I'm looking for guidance for how best to contribute for retirement. My husband and I are self employed small business owners, and this is new as of 2024. In 2023, we had kind of a hybrid year where he had a w two job, and then we had a side business that was a house renovation. And so our income from 2023 was quite a bit higher than we're used to. But now that the ship got close to the dock, we are going to try to take that ship and make our own income higher.

Awesome. So you're going full time with the small business, both of you?

Yes.

What kind of business is this?

It's a high end property maintenance and renovation.

Wonderful. What do you think you'll make this year doing that? Between the two of you, I'm hopeful.

That we will net a hundred to 120,000 for our household income.

Cool.

And your question today is about retirement.

Yes. So I understand that match beats Ross beats traditional. And I'm curious if we should just jump straight to the Roth or if there's a different. I don't know how to match myself, I guess.

Oh, sure.

As far as.

Yeah, that's generally for, if you have an, if you're working for an employer that has the match, that may be you guys one day. Who knows? But for now, there are, there's one option for anyone with earned income, and that is a Roth IRA. And so both of you can fund a Roth Ira to the max. I believe it's $7,000 for this year. And so both of you can do that. Your other option. A lot of self employed folks and small business owners don't realize that just because they don't have a big employer, there's still some really cool retirement options where they can put away even more money than a traditional employee. And one of the, one of the most popular ones, this one might be for you guys, is the solo 401k, sometimes called the individual solo, for the individual 401k. So as long as just you and your spouse and you have no other employees, you should be eligible to contribute to this.

Okay.

And as the boss, you can contribute an additional percentage of your net income to that 401k, up to 61,000 if you're under 50. Are you guys under 50?

Yes.

Okay. And it's even more if you're 50 or older.

So to reach the 15%, where does that number come from? Is that what we pay ourselves?

That's from your gross income for the year. So whatever's on your taxes, that's what the number you want to be basing it off of.

So, as a self employed couple, is our gross income our business income this year?

Yeah. Any profit? I mean, if you're working with your tax pro and you go, hey, our income, minus our deductions and all of that, this is really what we took home. They don't care how much you took home. It's still profit from a business perspective. And so you're going to have to pay taxes on that.

Okay, so 15% of whatever the number is that we pay taxes.

So let's say it's 120 grand, like you mentioned, you guys should be putting away 18 grand. And so maybe you both fully fund a Roth IRA.

That's 14.

And you put another four in a solo. Four hundred, one k. And.

Okay, and then, so, because this is also, like, new to us, should I just park money and, like, a high yield savings quarterly or till the end of the year, just so I don't step in anything for taxes, a big number. Taxes or retirement? Both.

Well, for high yield savings is for your short term goals, not for investing and for retirement. So it's a great place to store your money for tax reasons. And so I would do quarterly estimated payments to the IR's if I were you. Make sure you stay on top of that. And so, whatever money you get, put away 25, 30% in a high yield savings account, and then file those taxes every quarter and you might. Do you have a bookkeeper right now? Are you guys doing it all yourself?

I am the bookkeeper.

Wonderful. And you're the best one we got.

So, Carmen, I want to ask George a question on your behalf. Okay. So, George, you're talking about 18% of the net of the business at 120. If, like some small business owners, they kick off a small business and they're not going to take home a draw. They're going to pay themselves $10,000 a year for the first two years while this thing gets up. And they're going to scratch and claw, would they pay 15% of that ten grand as their, as their quote unquote salary?

Well, I think it's whatever the actual profits were from the business. So you can say, I paid myself $0. The government doesn't care because what they see is John brought in 200 grand.

Well, you got to pay taxes on that. But you.

As far as investing your 15%, correct?

Yeah.

That would be based off of the gross income that you took home, off the.

Off your draw of whatever you made.

So if you took 120 grand before taxes, that's what you want to be investing from.

Okay. But if you, if your business made 120 total, and after, let's say you grossed 120, like your total expenses, your total net was 200,000. It took 80 grand to run that business. You have 120 grand. You're going to pay taxes on that. You're going to pay yourself. You still invest before husband is ten, wife is ten. That's what your take home is. You're going to pay taxes. You're going to take 15% of 20 grand.

Exactly. That's the way to do it. And as the business grows, you'll invest more. I think that Solo 401K is a great option for you, and I would contact one of a smartvestor pro, and these folks can help you navigate what the best option is for you. There's a lot of different options. There's simple iras and sep iras. But from my experience, I found that most business owners that are solo or have a spouse working with them, the Solo 401K is the best option they've found. So you can go to ramsaysolutions.com and click on Smartvestor, and they can help you get that all set up and help you with the right strategy. But I hope that at least helps you take the right next step.

Yeah. Great. Thank you so much.

Awesome. Thank you for the call, Carmen. Way to go. That's a scary moment, stepping into small business full time, but what an exciting time. And you guys have done it the right way. Getting that boat close to the dock, it's not a leap of faith, it's just a step. All right, let's go to Terry in Houston, H town, John's favorite place. What's going on, Terry?

Hey, guys. How you doing? Thank you for taking my call.

Sure.

How can John and I help?

My question is, should I use the money that I have in savings to pay off debt, to start cleaning up my credit in preparation to try and buy a new home?

Okay. Tell us about your situation, how much debt do you have?

Oh, combined, my wife and I have about 110,000 in debt.

That's consumer debt.

Correct. Okay, well, actually part of that is. Well, part of that's a home, part of student loan. And then 17,000 of the debt is mine.

So what do you mean it's in a home? Because you're living in a home right now and you're going to sell it and buy a new one.

You are living in a home. We have a home equity loan that we have right now and we're down to about 58,000 on the loan left.

Okay.

She's got 33,000 in student loan. And then like I said, I have under my name 17,000 in debt, 15,000. That is really stupid debt that's already been charged off and I'm not sure the best way to fix this.

Okay. How long ago was that? How long it's been in collections for?

A lot of this has been a long time.

Okay. You might be able to negotiate that for some pennies on the dollar at this point and see if they'll take a lump sum and call it paid in full and get that all in writing. But as far as buying a house, it sounds like you guys are not. How much do you have in savings? Do you have enough to pay all this off, not to pay all of it?

I've got about 40,000 in savings right now.

Okay. That's all the cash to your name and that would get your debt down to 70,000, correct? Okay.

Yeah.

I mean, if you're following the baby steps, a $1000 starter emergency fund is what you're aiming for. And then anything beyond that needs to go toward your debt snowball. And so if you want to leave, you know, take 39 of that and leave 1000 in there and start crushing down that debt, I think that's a great move. And start paying them smallest to largest balance. So I'm guessing you're 17, is the smaller of the balances followed by her student loans. And then the heloc is the big one at the end.

Yes, sir.

What's your household income right now?

We bring home monthly, right at about 6200.

Okay, good. So the question becomes before now and.

The end of the year for me, it's going to increase.

Okay.

Just on the way.

Yet you're not sure when. Well, every single cent that you can muster up beyond your normal expenses, food, utility, shelter, transportation, throw at the debt and knocking out, you know, 39 of that today is going to feel really good and free up some payments and get you out of this debt faster. But I don't think you're ready to buy a house until you're at that spot. No debt at all. Emergency fund in place, three to six months. Then we start saving up a down payment, and your credit will probably have fallen solved himself by then. Thanks for the call, Terry. That puts this hour of the Ramsay show in the books. Thank you to my co host, doctor John Deloney. All the guys in the booth keeping the show afloat. And you, America, will be back before you know it. Live from the headquarters of Ramsay Solutions, it's the Ramsey show, where we help people build wealth, do work that they love, and create amazing relationships. I'm Ramsey personality George Campbell, joined by my good friend, doctor John Deloney. Open phones at 888-825-5225 you call us and we will do our best to help you take the right next step for your life.

Your relationships, your mental health, and your money. Megan is going to kick us off in Rochester, New York. What's going on?

Hi. So I'm just trying to get some advice with my. Trying to buy a house in about February, March 2025, I make about 68,000 a year. I am a single household. No kids, no significant other. And because of the financial economy right now, it's not an option not to buy because rising rents. So I am preparing to buy next year to also take advantage of a $20,000 grant that can be applied towards principal or closing costs. My situation, or my question, rather, is what to do with some extra money. My parents are taking out a HELOC loan to pay off my private student loans.

Please don't do any of the things you're doing. Megan, is this already. All the things you're saying, please don't do any of these things.

It's already in process. So without the student loan, I will be able to buy. But with the student loan, my minimum payment for it is $722. And I already talked to a realtor, and they said I maybe could get approved for $100,000 house, which is nothing. He said it's not impossible, but he was like, it would be very, very hard to find a house. So all the documents are already signed and everything for the HELAC. And it would free up dollar 455 out of my monthly payments.

I know, but it just put your parents house on the block. And so whenever you buy a house, make sure you've got space for them to move in with you someday, because.

Their, their chances of retiring just went way down.

Okay.

Already are retired.

I want to go back to earlier. Um, I. My initial gut reaction to you had some thing about rents are going up. So it's just, there's. It's. There's only one path forward. Anytime somebody says there's only one path forward, there's only two options. I always want to just pause and completely clear the deck. Talk to me about that, because I. So I would rather like just listening to your story. I would rather, if you were my sister, you were my kid, you were one of my best friends. I would tell you, do. Don't do any of the things you're doing. Move in with your parents. If that's the option, move in with them for a while. Talk to me about how there is just simply zero. You no chance know how can you rent a house for a season or an apartment?

I am renting right now. I'm renting a one bedroom apartment for $1,000, but rents are continuing to rise. My parents live in New Jersey, so we live in totally different states, and the job market for my field is not there.

So what's wrong with paying $1,000 for rent, making 68? That's not the problem here.

No. If it would stay a thousand, that would be great.

Let's say it goes to 1100 or deal breaker, 1500. It's still not the thing that's holding you back.

No. So the. My issue is if rent keeps rising, it's going to lower the amount that I can save for a house and interest rates going up. It's going to get to the point where I'm. I'm too underwater to even get a house.

Do you have insider knowledge that interest rates are going to continue to go up?

I don't, but you've been going, you're.

On the, you're on the Internet so, so much. Here's the deal. We may not be able to help you because it sounds like you got this all figured out. I would tell you just as a guy that's owned a bunch of houses and a guy that had to go see a doctor because I was so catastrophic in my future predictions. And by the way, they've all, 100% of them, I've been wrong on all of them. I want you to solve for peace, not for imaginary catastrophes that have or haven't happened yet. Our rents gonna go up? Yep. That's the way rents work, especially in a culture that refuses to build new homes, that refuses to build new houses to let people build. So, yes, rent is gonna go up. Is it gonna go up to the tune of putting your parents house on the block? No, it's not. Even if it went up 100% and your rent was $2,000, you can still afford that somewhat comfortably on your salary. Annoying, but somewhat comfortably. And I don't believe that interest rates are going to go up indefinitely from now and forever until the end of time.

Or saying, is this desperation is going to lead you to make a rash and poor decision when you're not ready for it. So how much debt do you have?

I have about 115,000, including that 48 from the private loan that's getting paid off.

So even with your parents taking on this heloc, you're still going to be left personally owing $80,000?

Yes. The one student. My federal student loan is in deferment until 2026. I have a $25,000 car loan left and a $5,000 personal loan.

What career field are you in?

Like, social work? Care management.

Okay. I used to teach graduate counseling courses. Okay. Mental health professionals. And I've had to have this terrible, uncomfortable, awful conversation, and that is with particular students in particular situations. I believe you when you tell me you were put on this earth to sit with hurting people and to figure out how to support and love hurting people in our communities. The least of these. And how to navigate the messy systems that they have to navigate. And I'll also tell you, I told my students it is unethical for you to stand up in front of people and help them, and at the same time, you be so terrified that you can't breathe because of how much money you make. And so at some point, you may have to say, okay, either I got to take a second job for two or three years until I can right this ship, or I'm going to have to go get a different kind of job and put my. My calling on hold for a season because I simply can't afford to live in the place where I want to live and do the job that I want to do because it sounds like.

I have a second job.

Okay. Yeah, that's what I was afraid you were going to say. You're already ahead of me. Here's my fear. Your biggest war is against math, and it's not going to change. And you owe 150 grand, and your parents are going to. Are going backwards to help, and you're going to go backwards to help, and you're going backwards to. To get. See what I'm saying? It's just this. You're just. You're in a car, and the wheels are spinning. And I'm only telling you this because I love you and I just don't want to see you go so deep. I want the world to be able to experience your help as a trained social worker because we need you. But you can't breathe right now, right?

I'm living comfortably where I am. Like I said, I just. Because I have my total expenses, monthly is about 3400 and I bring in a little over five. Good.

That all needs to go to the debt. What's your car payment, Megan?

Go to debt 575.

What's your personal loan payment?

Two oh five.

Okay, I just added that up. We're talking $1,400 in debt payments. Thousand dollar rent is not the problem. You could free up $1,400 if you got aggressive at this debt. Hang on the line. I'm going to send you a copy of my book, breaking free from broken. I want you to read it all the way through and send me a DM and let me know if that helps and if we can help in any other way. So hang on the line, we'll send you a copy of that book. Wishing you the best. Welcome back to the Ramsey show. I'm George Campbell, joined by doctor John Deloney. Open phones at 888-25-5225 it's time for a question of the day. And today's question comes from a student, Travis B. From Bryan High School.

All right, the question is, how do I approach my parents to talk about money when I'm learning about the baby steps? And they never have been very good with their own money. Great question. Good question.

Does Dave call this one powdered butt syndrome? Like, parents don't want to hear financial advice from the kid that was changing diapers for.

Yeah. Two things. They usually don't want to hear about sex and they don't hear about money. Like, I don't want to talk to you about that. I changed your diapers. Right. I think this is going to depend on your household. So, for instance, in my house, I do not want to raise a son and a daughter. I've got two kids I don't want them to raise. I don't want to raise two kids that are compliant. Meaning they never ask me to explain why I do what I do or if they see me having trouble with something. My son the other day said, dad, why don't you just pick all that stuff up and take it out of the car when you get here instead of getting all mad when your coffee won't go in the coffee holder and it's full of all these cans.

You raised a prodigy.

Well, I looked at him, I was like, how about you just shut your right. But I want my kids to question things because I don't want them to go out into the world and just accept whatever culture says, right? And so in my house, I would love for my son to be like, hey, I don't understand why you'll have so much tension. You're always complaining about bills, and you'll have these credit card things. I'm learning about it. Can you teach me about that? Like, and that's, that's how we teach our kids, obviously, be respectful. I've learned, which I'm doing, just naive. That's not how most people do it. And so most people, parents don't want to hear anything from their high school kids, especially points of pain in the household. And so this is a good moment when I think all high schoolers, college students, begin to imagine their world as they get older. And sometimes we want to take things from our childhood. I want to be a dad just like my dad. Or sometimes we say, I'm never going opposite direction. I don't ever want my kids to experience what this is. And so I think this is one of those moments that maybe you can't.

Maybe you begin to get your summer job or your everyday job, and your parents are like, well, you got money? And you say, well, I'm saving this much money. I don't use credit cards. I don't use debt. I'm following the baby steps. And maybe it's an invitation for them to say, well, tell me about that, versus I'm going to lecture my mom and dad. That ain't happening. Right.

Exactly. And part of this, we're taking this question, it's financial literacy month. And one of the ways we're celebrating that is taking questions from actual students at high schools that are teaching our foundations in personal finance curriculum. So the interesting part is these students are going to school learning how the credit score is a scam and how credit cards keep people broke. And then they're going home and they're going, hey, mom, here's what I learned today. And the parents are like, what? They taught you what? You need that, son, the credit score is a good thing. So naturally, conversations will be struck up from this. And so if I was the student, I would come home and they go, hey, son, how was school today? I go, it was actually really cool. We took this finance class, and I'm learning about credit scores. And did you know this? If you come at it from a place of just, like, curiosity, empathy, excitement. Hopefully, if you have healthy parents, they'll go, tell me more about that. Really?

Or they'll call the school district and be like, let's ban that book. Ban the book.

Yeah.

We need to teach our kids that there's good debt and they should all be taking it out.

So part of that teacher for teaching my kids something I don't agree with.

This might be a ten year journey of trying to convince your parents that there's a better way to handle money, and it might never work, and you have to grapple with that. But I think the best way to talk about it is from your own perspective, your own experiences, and asking good questions, and you can disagree politely. Don't disrespect your family here, but you also don't pay bills. So again, they're not going to take your opinion with a lot of weight when they're still covering all of your.

Expenses and be all high school kids. Be slow to judge your parents because you don't know. You don't know the full picture of what they're going through, and they're not having every conversation with you. And you think you know everything, but you don't. And I also think very few people don't like to teach something that they know and even if they're not great at it. Right? So maybe the approach as a high school kid is, hey, we're learning. We're taking this finance class. We're learning all about money. Will you teach me about how y'all budget? Like, can I sit and watch y'all budget? Cause I wanna learn how to do this. I'm learning this at school. And you might find, yeah, we don't do that in our house. And then you might ask, would y'all be willing to do that? I'm learning about at school. I just wanna, like, try it.

Can you help me with mine?

Right? Can you teach me with mine? And so everybody likes to help somebody when they come and sit before them and say, will you teach me something that feels good?

And planting some seeds and going, hey, I'm going to go buy the total money makeover and breaking free from broke and go, hey, I'm reading this book. It'd be really fun. If you guys are open to it, I'd love to read it with you guys and we talk about it and.

Then learn about money again. I. Trust me, I'm not the parent of the year. But one of those conversations I started when my son was younger was, I'm going to read a book. And occasionally I'll say, you got to read this book. And he gets the right to say, dad, you got to read this book. And so I find myself reading these science fictiony. I don't understand them, but here we go. And my son's sitting over there reading the comfort crisis by Michael Easter. Right. He just buzzed through the anxious generation book by the author of the coddling of the american mind, the Jonathan Hyatt. He read it before I did. Right. And it was on the desk. And all I have to say is, if you start when your kids are young with this idea that we read books and you read a book and you read a book, then maybe when your high school kid stumbles on something that's important to them, they already have a mental map of. All right, let's read this together. And you can go with them on that.

That's beautiful. Well, I hope that helps. Travis B. Hope that helps you. There's no easy way to do this, and it may not go well, but, you know, you lead with, with empathy, humility, experience and curiosity. I think it'll go better for you. All right, let's go to the phones. Haney is in Chattanooga. What's going on, Haney?

Hey. So I've got, I'm getting married in August, and I've only got a car loan. That is the only debt that I have in my name, and she doesn't have any debt. But I'm wondering, is there any way that I can get out of this debt before I get married? Because I know the number one reason for divorce in marriage is finances, and I want our marriage to succeed. Obviously, I do, or I wouldn't get married. So I'm trying to figure out how I do that or if it's even possible, if I just need to do the beans and rice and pay it off and just, just get at it.

Well, I'll tell you this, based on how you just set that all up, your marriage success is not going to be based on whether you walk into this with a car loan. And so I don't want you to hold that pressure over you like, I'm a bad husband already. I'm a failure. I think your spirit to want to set your family up for success aggressively, that's what's going to carry you.

And it's fights about money or it's misalignment about money, not the actual debt amount that you walk into a marriage with.

But it sure helps when you can walk in with no debt. So what's your car loan? What's left?

So it is 35 one right now.

How much do you make a year?

I make around 40,000, give or take some. I make 20 an hour. But I do make commission on certain things.

So when you say 35 one, are you talking about $35,000?

Yes, sir. I'm sorry. 30. 35,000.

Okay, so good news.

You will be out of debt by the time you're married because you're selling.

This thing today, this weekend.

Well, the thing is, I'm upside down in it. I made a bad financial decision when I was back in 2020. My car had broken down and I bought a 2011 jeep, and basically I bought a linen. So a couple months ago, I brought it to the dealership. I'm like, hey, I can't drive this anymore. It's been in here more than I've driven it. And they're like, okay, we've got this brand new 2024 Toyota Corolla.

Brilliant.

Can do a trade with you. And the way they played it out, to me, it would just be an even trade. And I didn't really pay attention on. It's stupid of me. I never realized that.

How upside down are you?

And I'm $8,000 upside down.

Okay, so even if you sold it today and you have $8,000 in debt, plus 5000 more to go get another car, right, you just cut your debt by $22,000.

Right?

So you go to your local credit union and say, hey, I'm looking for a loan for 13 grand. That'll cover the eight grand you're upside down on and give you five to go get a beater car for now. Okay.

And you're gonna be. You're gonna have some hedge head hanging because you're gonna, like, walk around a little bit of shame because you were driving a brand new car, and now you're driving a car that your fiance is gonna be like, oh, we still in love? I don't know if I still love you. Just kidding.

She honestly, if I got rid of this, I do not care.

I don't.

I don't have a problem with driving old car.

Oh, I'm playing with you, of course. I know, but, yeah, I would.

You guys scrape together a difference either with cash or with a loan. And that's the one only times we say it's okay to get a loan because this is getting you out of debt so much faster. So I'm wishing you the best. This is not going to be fun where you're amputating the Tahoe or in this case, the Toyota. Never trust the dealership, man. You got hosed. And I'm sorry. But hey, we're gonna send you financial peace University as a little wedding gift on us. So hang on the line. This is The Ramsay show. I'm George Campbell, joined by doctor John Deloney. The number to call is 888-25-5225 we are about to kick off our live event season. We've got the entree leadership summit event happening soon. And we also have total money makeover weekend happening May 10 and 11th. And this is the whole gang, all the Ramsey personalities. Dave Ramsey, Doctor John Deloney, Ken Coleman, Jade Warshaw, Rachel Cruz, myself. And we are going to help you create good, healthy money habits and change your relationship with money for good. So we're going to cover all the things you want to know. We're hitting the classics, of course, getting out of debt, creating a budget, communicating better with your spouse about finances, easing anxiety around money.

With doctor John Deloney, how to make more money and, you know, for the long term and the short term. With our friend Ken Coleman. How to invest, build a retirement of your dreams, how to own a home instead of it owning you. All of that is happening. So this weekend long event is the ultimate motivator to get you fired up and live the life you've always wanted. We're going to be doing a live taping of smart money happy hour with Rachel Cruz and I on Friday night. You don't want to miss that. Along with a kickoff from Dave, there's going to be live interactive Q and A's throughout the weekend. We'll all be hanging out, meeting you. It's going to be such a good time. We had a great time last time we did this. A different event up there at the new rec center. And it's a destination event now. People come from all over the country just to see us and hang out.

Yeah. And I kind of got my feelings hurt. We weren't doing a live recording of my show. And then I realized probably not. Probably not good for, for morale.

Yeah.

We want this to be a pep.

Rally, John, not a. Whoa.

Yeah. I mean, your show is wonderful.

Yeah. But it's, it's, it's, it can be awkward with a couple thousand people and their kids in the audience. Yeah.

Maybe not, not quite cut for a live event crowd quite yet.

Not live family event crowd. That's right. Yeah. But hey, this is adults only. Perfect.

That can be a separate event. That's an add on. So don't wait to get your tickets. Platinum tickets already sold out. You can still get vip. Sorry, platinum plus is already sold out. We have platinum and vip. Few left there. General admission still available. Get your tickets now at Ramsey solutions.com events. Get it in the budget. Plan to join us. We are less than a month out of. And we're getting pumped. All right. Jonathan is on the line in Atlanta. What's going on, Jonathan?

Hey, George and John.

Hey.

How you doing?

I'm doing all right.

How can we help today?

Well, to. Just to start this off, I got a lot of pressure on me, and I'm just trying to figure out my options, I guess you could say.

What kind of pressure?

Yeah.

Where's that pressure coming from?

My family, unfortunately.

Wife, kids? Who. Who exactly?

My dad, my brother.

How old are you?

I'm 23.

All right. They don't get a vote. Are you hearing me? I'm not even laughing. Normally. I'm kind of a clown. I'm not even laughing. I can hear your voice. Dude, they're burying you. They don't get that. They don't get that privilege anymore. What's going on?

Well, both my brother and dad, they.

Don'T care about them. Tell me about you. What's going on with you?

I'm stressed out, man.

I know you are. I can hear it. I can hear it. What's up?

I'm looking a way to increase my income so that I can have, like, a good nest egg for my future and also, like, gain some skills and whatnot. I'm only making 36,000 a year right now, and I don't know if I'm, like, heading in the right path.

What do you do for work?

I'm a Lowe's sales specialist. I sell washing machines and fridges and all that stuff.

Okay. Did you go to school?

No.

No, I almost did, but my back that at the last second.

Okay, so what are you wanting to do? If we snapped our fingers and you had a career and do you have something in mind? You're like, this is really what I'm aiming at. Or are you totally lost in this space?

If I'm gonna be honest, a bit of both. But I always wanted to own my own business. I do have a small business right now. Like, I make little, like, small. Little wooden tech decks and all that. And I sell it out to people. It's a small business. But, like, in the future, I would actually love to upgrade to full size skateboards, you know?

Okay. So kind of woodworking and with a niche of making skateboards.

Yeah. And, like, sales here and there. Like, I'm also. I'm also really good at sales, at my job as well.

Yeah. And where's the pressure coming from? Are your brother and dad, like, hey, dude, you're not doing well? Like, what's. What are they saying to you?

Well, this is gonna sound weird. Quite the opposite, actually. They're telling me, like, oh. Like, we see something in you. We think you can be successful and all that stuff. And they've been saying that, like, I guess, all of my life, and honestly, I.

What's their end game?

I'm sorry?

What's their end game with this? Do they have a business together or something they want you in on? What's the heart behind that?

Honestly, I don't even know, dude.

They see their brother and their son making $36,000 a year as a salesman, as a 23 year old. And I know that's not a ton of money, but in the place that you're doing that, that's. You're doing a good job. And you help guys like me who literally know nothing. And I come into Lowe's and I say, hey, can you help? And you're like, yeah, I got you. What do you need? I think beneath your dad and your brother, you don't like you, man. I can hear it. Why do you think you're. Why do you think you have failed, man? You're 23. You're learning the ropes of a huge corporation and how to sell and helping out people from elderly folks to knuckleheads like me, to even more knuckleheads like Jordan. Like, you're helping. Like, you're learning how things work. You're 23 years old, and if you figure out sales at 23 and 24 and 25, and then all of a sudden, you're running the department, or you move on to selling oil equipment. You're a multi multi millionaire. But you don't like you, dude. Why?

I feel like I could. I could do better, I guess.

What does that mean? Paint me a pic. Be very specific. Paint me a picture. What does better mean?

I want to. I really want to help my. Like, my dad, my brother, and, like, stop you.

You. What does better mean? Because they love you. They see it in you. And I bet they're telling you that they see a spark in you because they're tired of watching their son and their brother walk around with their head hanging down. Or let me put it this way, you are making more money than I was at 23.

I don't think this is about money or nest eggs. I think you're, you're not sure what your purpose is, and you're listening to a lot of voices and you haven't really figured it out for yourself. And I'm not sure you, you believe in Jonathan anymore.

That hit hard. Yeah.

So, man, close your eyes for a minute. You're 33. Not dad, not brother. What do you want to be doing, man?

I guess owning a business, making sales. And.

Yeah, then I would tell you if you were my brother or you were my son, you are right where you need to be. And you probably need to be doing some stuff on the side because 36,000 is not a ton of money in today's economy or you'd be asking the folks at Lowe's, hey, what's the, what's the growth path? Yeah, how do I move up and be, and sell bigger ticket items? I don't know a lot. But I know that a good salesman can move industry to industry. A good salesman is a great person to have around because they just know how to talk to people. They're good with relationships at skill transfers.

And you can make crazy money everywhere. And we talked to those people on the show. So, Jonathan, we believe in you. And one of the ways we're going to help you believe that is by gifting you a few items. One is John's book, building a non anxious life because you said you're stressed. This is going to really help with some really tactical things you can do. Another one is Ken Coleman's book from paycheck to purpose. That's going to help you figure out that clear path to doing the work you love. And finally, I'm going to give you Ken's new book, which is on pre sale right now. Find the work you're wired to do. It includes his get clear career assessment. I want you to take that, and it's going to give you a much better picture. You're going to call us back and say, I know exactly what I'm supposed to do. I'm feeling so much more encouraged. I'm on the path. And stop listening to voices that aren't helping you grow, my man. We believe in you. This is the Ramsey show.

All right, let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey trusted agents aren't just experts who guide you through buying or selling. They're someone you can trust to have your back from the first call to closing day. Find a Ramsey trusted agent near you@ramseysolutions.com. Agent ramseysolutions.com Agent.

Welcome back to the Ramsey show. I'm George Campbell, joined by doctor John Deloney. If you're enjoying this show, be sure to check out all the other great shows on the Ramsey network, including my friend doctor John Deloney's show on podcast and YouTube. And of course, George Camel YouTube channel, which is popping off not quite as big as John's. John's has had a hockey stick in lately. I don't know what happened, John, but I don't. Trust me, the team's been doing a killer job. I don't think has anything to do.

With you, zero to do with me.

But congratulations on all the success. And of course, all of our personalities have some great shows out there. So if you, you get, you know, tired of the Ramsey show, there's so much more to choose from and it's free. So go check it out, podcast YouTube. You can check out Ramsey network wherever you listen to podcasts and catch up. This weekend, Joseph is down the road in Nashville, Tennessee. What's going on, Joseph?

Hey, guys. How are you doing?

We're doing well.

How are you doing?

Pretty good. So my question, I just listened to the audiobook of the baby steps millionaires and I got a lot of good insight out of that. I put my thousand dollars in savings. So I was moving on to step two. And one question I have, I get a quarterly bonus at work and it's usually around somewhere between two and 3000. So I've got two credit cards that I'm looking at paying off one, 6000 and 7500. So my question is kind of how would I take that extra money and what's the best way to apply that to those cards? Just, you know.

Well, I love that you're wanting to aggressively attack this debt. Do you have any other cash in the bank?

I mean, just my regular cash flow, you know, as far as my regular job. So I do, I do pay a little more, you know, than, than the minimum balance on those. So I'm trying to knock it down that way. But I definitely want to leverage these quarterly bonuses to help me, you know. Yeah, knock out those big chunks.

Well, with the debt snowball, you would just lay them out smallest to largest, ignoring the interest rate. And that bonus would cut that one six k card down to three, right?

Yeah. Yeah, that's, that's kind of what I was thinking.

And you'd make minimum payments on the other card and keep attacking that smaller one until it's gone, and then you'll free up that payment. You can roll that into the $7,500 credit card and, again, aggressively attack that one. Is that all of your debt?

Yeah, that's it? Yeah. I don't have any car payments. I do have a house. So, you know, obviously, that that would be the next debt.

Okay. What's your household income?

I am the only income earner, and I make a salary of 124,000 before the bonuses.

Wonderful. What caused you to go into this credit card debt if you're making 124?

Well, at the time, it was. These weren't really typical spending habits. I don't really leverage those cards for, you know, clothes or any shopping or anything like that. I had some incidentals pop up, like an air conditioning unit go out and things of that nature where I just didn't have the emergency fund set aside. Right. And so that's kind of what. That's kind of what spawned me into looking into, you know, setting myself up for a better situation for the future, getting my finances in order.

Well, you'll be down to about ten k of debt after this bonus and making one hundred twenty four k. I would set a very aggressive goal to go, hey, could I put an extra two grand this month on this card? I'm going to be done in five months, and then I'm going to start building that fully funded emergency fund, and that becomes your I never need to go into debt again fund. And when I cut up those credit cards, man, this amazing thing happened. I was unable to go into debt. I couldn't do it. You just can't do it by overdrafting your checking account. And so I think that's a great plan for you. As soon as you get these cards paid off, cut them up and never look back. Kyle's up next in Des Moines. What is going on, Kyle?

How's it going, guys?

We're doing great. How are you?

Good. Yeah. So I'm calling. I have about 78k debt, the majority. I mean, it's like 35, 37 is my house, and, like, 26 is vehicle, and then I have the remainder, like a student loan.

You only owe 35k on your house?

Yeah. Yeah.

Wow. Amazing.

What's it worth.

You know, with the housing market right now? I honestly don't know. I mean, I'm in Iowa. I have an acreage, so cool. It's a five bedroom house on six acres. But.

So $42 million in today's market. Well done.

Right. But. So I have a large family I have four children and a fiance, and we had discussed possibly selling my acreage to kind of eliminate the debt. And there's, like, a situation where we could possibly get some land and throw a house on, but then it's like, okay, then we're just acquiring more debt. I'm sure. But I guess my main question is, should I attack my vehicle first? I'm new to Dave's strategy, so I'm.

A guy who's got a house on some acreage, and I would tell you, let's exhaust every possibility before you start selling dirt. Is that fair?

Yeah.

How much do you make? What's your household income?

I bring in about seventy k a year.

Okay.

My fiance, my fiancee, we just had a kid last year, so she's kind of just doing odds and ends stuff to make ends meet right now.

Okay. Are you guys struggling to just pay the bills right now?

Kind of, but not really. I think. I think it's more lifestyle living that's affecting us.

What's the car worth? Or the truck?

It's a Kia Sorento. I honestly haven't even looked it up.

But if you're really feeling the pain, you could always downgrade in car and pay cash.

And if I'm you right now, I would sell that car before the weekend is over.

Right? Yeah. Because we had talked about, like, she didn't want to go the minivan route. I was all about the minivan route, but. So we ended up going with suv because of winters here in Iowa. But I've kind of been pushing the minivan route more into her head.

So I would go with the used Camry route for a while.

Yeah.

And I know it makes it a pain for getting the strollers in and out and car seats in and out. I get that. I got kids, but right now y'all are broke and I would rather give up the convenience on the day to day stuff and bring peace back into my house.

Right.

I would sell that car and that would knock off, what, half your debt right there? Yeah, your house. We don't even consider that part of your consumer debt problem. Right. So you not, like, back your house up for a second, pay your car off? I mean, sell your car and the.

Student loans, the smallest.

Right. $10,000 car, and you're good to go.

Yeah.

So if you sold this car, downgraded, knocked out the student loans, that just leaves your mortgage. And so are you doing an investing right now?

No, no, I'm just. I'm honestly, paycheck to paycheck. I need to get on budgeting.

Well, I'll give you the spark notes here and then we'll give you a free tool to help you with the next step. So the baby steps as they're laid out, they've been working for 30 years when Dave came up with them in this order. And they work every time you work it. So, baby step one is $1,000. You have a $1,000 in the bank?

Yes.

Good.

Okay, baby step two is going to be knocking out all of your consumer debt, everything except the house, using the debt snowball method. And all that means is smallest to largest balance, ignoring the interest rate, throwing as much as you can on the smallest debt, make minimum payments on the rest.

Okay. And I've done that. I mean, I just not like this. Last week I knocked out eight, nine k in credit card. Those.

Amazing.

I heard you guys on the last guy.

Good. And thank you for listening.

Credit cards up, correct? Yeah.

Cut them up. Close the accounts. They have not been a blessing to you and they will not be in the future because you're the secret sauce. Your income, not a credit card company's cash back or points. And that freed me when I did that when I was a young man or eleven years ago.

Now, quick question, and I don't mean to take up all your guys time, but. So Dave Ramsey, he's basically, don't even worry about your credit score. Right? Because I'm. Because I'm assuming when I cut those credit cards, my credit score is just going to tank.

It might take a temporary dip.

My credit score is zero.

Right, right.

The funny thing is, when you think about it, why stress about credit scores? Credit scores allow you to take on more debt. And so our job is to help people get out of debt.

Yeah. And that's what I caught from the last conversation that you had with other guy.

You already have a house, so you're good. What do you need a credit score for?

Kyle, if I gave you a million dollars today, $1 million, your credit score will stay the exact same.

Yeah, yeah. Sorry.

Yeah, your credit. Yeah, your credit. Your credit score would stay the exact same because it's not a reflection of your wealth. Your checking account is. Your bank account is not your credit score.

Yeah. Okay, so from, from your guys's perspective at 38, like, I need to take on more jobs, become a millionaire. Correct.

It's not necessarily more jobs. You do need to increase your income. You got four kids and you have a great income. But, man, we got a ways to go. So you're 38, you still got a good, you know, 30 working years left to clean this up and build a nest egg. And we're going to help you. We're going to gift you financial peace, university watch, all nine lessons with your spouse. We're also going to give you every dollar premium to make a plan for every one of those dollars. Coming in. 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 amazing relationships. I'm hosting today with my friend, doctor John Deloney. I'm George Campbell. Give us a call at 8825-5225 if you want to talk about money, relationships, emotional health, boundaries, or lack thereof, John is going to be your guy for that. And he's been sitting with hurting people for 20 years now, helping them navigate relationships and take the right next step. And, of course, classically, if you want to talk money, I'm ready.

Let's do this thing. Liz is on the line in Houston to kick us off. What's going on, Liz?

Hey, guys. First of all, thank you so much for taking my call. I really appreciate it.

Absolutely.

Thank you for calling. Hey, before you ask your question, what's happening to our Astros? Liz.

Don'T get me started.

I'm trying not to get started myself, but. All right. We could talk offline because I'm having sleep here.

I know, I know. So the problem. The problem is, well, so I'm 60. I'm a nurse. My husband's 69. He's retired, and he, I guess retirement and, you know, running around and, you know, living the life, which he should after, you know, 40 years in the oil field, he got into gambling, and so he'd, you know, run up to Oklahoma and do some gambling and all this. So how bad is it? Right? So last August, I really got involved with the Ramsey stuff, and I thought, wow, this is pretty impressive. And so I got his book, you know, the financial freedom, and then I also got Doctor Deloney's book of the non anxious life because he was stressed about, you know, retired and all that, and kind of running around, didn't really know what to do after being such a workaholic. And so since then, he's gotten help for the gambling. He's really. He stopped. I mean, it's like it was a phase. But that phase left us about $150,000 in debt.

What kind of debt? Credit cards.

Well, credit cards, yes. Credit cards.

God almighty.

And. I know. And. And he was, you know, really embarrassed and how I found out about this. I mean, I have a few credit cards and I'll use them, you know, go to work, get gas, you know, you know, whatever. Pay them off, whatever. And so he's always had his own credit cards, business credit cards and so forth. And I never, and I know it sounds irresponsible because he's so responsible. Never paid, never paid attention and never been a problem before. You know this. So I got the financial freedom book and going through everything, and I was like, okay, let's lay everything out. And he very shamefacedly produced these bills. And.

Did your heart stop, Liz?

Well, I'm an Er nurse, so it takes a lot to stop that. But I was. I was put on pause pretty, pretty good. And I was like, wow, babe. And he's like, I know. So got him some help for that. You know, he's doing other things now. Got involved in hobbies and so forth. So that's. It's not a problem anymore.

Do you still have open. Do you still have open revolving accounts at your home?

Right?

Do you.

Do we have what now, sir?

You still have open revolving accounts at your home?

What does that mean?

Do you also have access to credit in your home?

Oh, no, no. That's a. Well, that's the first thing we did was set up the credit card.

Okay. All right.

What is your minimum payment on these cards altogether?

Altogether, I would say probably $4,000 a month.

What do you guys bring home every month?

About 7500.

Are you able to eat right now? What are your other expenses?

Well, we actually don't have any. Our property is paid for. Land, house.

Where is he working right now?

He's not.

Yeah. His butt needs to go back to work tomorrow as. And this is part of his getting well, because he's not. You don't just flip a $140,000 gambling hole switch like this.

Yeah, he needs to go back to work tomorrow.

Tomorrow, tomorrow.

Yeah, yeah, yeah. We've already had that talk. And he's got some resumes out. You know, I'm talking.

Go to Starbucks. I would love to have a 70 year old oklahoman oil field worker making my latte for me. That'd be amazing. But he has to listen. He's going to. He's going to bathe. He is going to bathe in shame if he is not a participant in helping make this home whole again.

Right.

And you can have all the conversations, but you gotta. You're thinking of selling? What are you thinking of selling?

Well, we actually sold a car already.

Okay.

Sold a little car and got that? And put that immediately onto a credit card. We've paid off two. We've paid off two.

Okay.

And there are seven more to go.

Okay.

And that's. That's. Well, that's going well. So we have assets. We probably have 130 in a 401k. We have.

Go to the next one.

No, no, I'm just laying it out.

Okay.

We have 130 in a. Then the rest of the investments altogether. Fidelity and vanguard, what have you total up to? About 350. Almost 400, actually. It's like 380 something.

That's your total nest egg?

Well, yeah, that was our total nest egg. And then we also own land, quite a bit of high dollar land, and which we don't want to sell. So what does quite a bit of.

High dollar land mean? How much?

Well, north of Houston, it's, you know, Houston's moving up that way. So we have our homestead, which is, you know, about seven acres with the home on it. And then we have land across, also in the same little town. That's about three and a half acres altogether. That whole holding is worth about a million dollars.

I would sell that three acres of land. And I know you don't want to, but I can't tell from your voice, Liz. I've talked to a lot of people over the years who are with folks in this very similar situation, that they found out that their spouse has massive, massive amounts of debt, whether it's gambling or otherwise. I don't know if your years as an ER nurse have. I've been around some. Some trauma, trauma, medical providers who are basically like, walking Xanax is. Nothing rattles them anymore. And that may be you or if.

You are next on board, but just super, super patient. And the fact that, you know, we've made good headway and the gambling stopped, and I can't.

I don't think. I'm wondering if you fully metabolized how bad this is. We call it financial infidelity.

Not.

Do you know what the interest rate is on these cards?

Yes. The cash advances alone are, like, 30%.

So, listen, part of the hole that was dug is going to be rectified with part of your dream that you'll had.

Mm hmm.

It's going to be a cost to this.

Right.

Either he goes to work tomorrow, says, I can make $50,000 over the next three years, and a hundred percent of that goes to paying this off. And I was gonna be retired from 7071-7273 I'm not. Or part of your million dollar retirement. Your land holding is gonna go to dig this, dig yourself out of this shovel. There is no way that your life doesn't look different. Y'all are trying to just nickel and dime this sucker.

It's not gonna work. 5000 on interest alone happening each month. So you gotta get rid of this. You gotta sell these acres. I don't want you decimating this nest egg and unplugging all this growth because there's not much there to begin with to get you to live through Nest.

30, sell your investments.

Yeah, so I would sell the land first. I'm so sorry. This is the Ramsay show.

Hey, folks, Dave here. If you're in baby steps four through seven, join me for the ultimate debt free celebration as we set sail on the live like no one else cruise. We're taking over an entire ship for seven days in 2020 2025. And we'll stop at some incredible places like Turks and Caicos, St. Thomas, San Juan and the Bahamas. We'll also have some special guests joining us, including Stephen Curtis Chapman and Manit Shohan. Book your cabin now@ramseysolutions.com.

Cruise.

Welcome back to the Ramsey show. I'm George Campbell, joined by doctor John Deloney. We've got a lot of fun things launching around here, and one of those is Ken Coleman's get clear assessment paired with his new book, find the work you're wired to do. And so the get clear assessment has been going gangbusters. It's been helping a lot of people. And so this book is going to help people live out the principles and get a really clear picture of the work they do best and love the most and how to use these results in their job search. So the assessment and book combo will answer four of life's biggest questions. Who you are, why you're wired that way, what you want to do professionally, and how to get there. And this self awareness is going to point you in the right direction, give you clarity and confidence so you can pre order the get clear assessment, find the work you're wired to do right now. You'll also get the audiobook and ebook for free along with the assessment and the book. A lot of good stuff. Go preorder it@ramsaysolutions.com. Store all right, let's go to the phones.

Howard is in Indianapolis. What is going on, Howard?

Basically it's kind of a relationship and financial thing. I currently have a girlfriend. We've been living together for four years. I guess the thing that I haven't moved forward, one of the reasons for making the full relationship, marriage and all that stuff is financial. I'm a responsible person, I feel. And she kind of never wants to talk about the budget, even though she wants my help sometimes. And she has an attitude, like, I do nothing with my own money, but yet when she wants money or help a little bit, I'm always there. So I feel I have the right to. Especially, like I said, I have one credit card under my name that she got for a washing machine that it could have been paid off. Has not been paid off. And then some other things down the road to.

Wow, bro, you just spit a lot at.

It's not. It's not. It's. Yeah, well, I'm trying to be quick. She said be quick, but it's not as, you know, complicated. You know, it may sound, but it is.

You know, to first blush, this sounds a lot like Howard's fault. She hope she has a credit card in your name.

My background. I'm pretty responsible, meaning, because my dad was a huge gambler, so me and my siblings are pretty responsible with money and not. And I guess the point is she has the money to do stuff that she would budget and we'd work together, but she doesn't want to work together. And if I confront her about it, you know, it's almost, like, not my business. But yet when you, like, the other day, she needed some money to help pay a bill, even though, really, if she budges her money, there's no reason why we can't.

Hold on.

Howard.

Howard, you called in. How honest can I be with you?

Oh, brutal. I'm about something brutal, believe me.

Yeah, I don't think that you are. You're totally good.

Yeah, no, I am.

Yeah, totally. All right. This relationship is long over. Okay?

Okay.

Long over. And here's. Here's. Here's what I mean.

No, look, I've been told that before, okay?

Money is a symptom. And if you, as a guy who grew up in a traumatic household, okay, with. Let's say, let's. Let's take money off the table. You grew up in a household, and dad was an alcoholic, and he was abusive, and the whole house was electric, and you. You put a little gps pin in alcohol, and you committed. I'm never going to drink. And you're with somebody, and you're planning on spending the rest of your life with them. You've been with them four years. You'll share a house. You'll do this life together. And you would say, hey, I don't want to be around alcohol. And every night she walked in with a bottle of wine and a vodka tonic and was like, I don't give a crap what you think. It's my life I'm going to drink. Everyone in your world, including you, would know this person is not willing to align values with you. She does not care what you think. And so forget the money thing. Any relationship has to have two people that will sit down at a table and say, hey, this scares me to death. And the other person says, I'm in or I'm out.

And you all keep making this about money. And here's where this leads, which is right where you are, bro. You think you're better than her. And the only power leverage she has over a guy that thinks he's better than her is this. I'm gonna do whatever I want. And that's the way she can hit the other side of the teeter totter. And that's why I tell you, y'all are just in a playground, going up and down on the teeter totter. I'm smarter than you. I'm better than you. Yeah, well, I can do whatever I want, and I'm smarter than you. I'm better than you. It's going up and down, up and down.

I got. You.

See what I'm saying? At some point, you got to get off the teeter totter and say, I love you. And I have to have somebody who's willing to sit down at a table and hear me when I say, I'm scared to death about how you spend money, about how we do life.

I agree. And you know what? Honestly, and this is sounds bad. It's almost like we're separate. I've taken my own entity and start taking care of myself financially, individually, which is bad in a relationship, but I've done that.

Well. But here's the thing.

When I.

When I say it's over, y'all are just. Y'all are. Y'all are roommates. At what? Who's gonna have the courage to sit down and say, what are we doing?

I gotcha.

Because now you're choosing on a daily basis, both of you are, to live in misery. Y'all both are worth more than that. That's a strange choice to make, you know, in a country where you can.

Kind of do what you want to work together, but she just doesn't want to. We don't. I'm not saying we're rich. We have the means to work together. Absolutely. But we just don't do it.

But you. You understand you are both choosing that, right?

Yes, I know, I totally. I totally.

Okay, what's your path back?

What's my path back to what? Trying to get this to.

Let me ask you this. Are you done, dude? Are you done? It sounds like you're done. It sounds like we're, like, having nachos at a bar and you're just. You're about to break up with her and you're just like this and this, and I've already.

Don't want to. I don't want to. Honestly, I held off. I didn't talk about. Like I said, I just recently found out about that bill that wasn't paid because I kept getting.

Hey, hey.

Text messages.

You and I and all the other 20 million people listening to this. No, this is not the only thing that is divided in your home.

Oh, my God.

Right?

Probably right. But I'll say. I'll say that I put this off till I come back. I'm actually going on a trip, and then I'm coming back. I didn't want to put this off and have a fight before, and then all that stuff that's, you know, it's.

Funny, but I'm right, right?

Oh, you know, you are. You are absolutely right. I'm not disagreeing what you say.

Okay. You know, at some .1 of you has to be the adult and turn the lights on, turn the music off, stop the party, and say, hey, life is too short for us to be this far apart and for this to dishonor each other this much. Every single day of our lives, we have to have an honest conversation about where things are. And more importantly, are we both going to continue to do this tomorrow? Do I think everything has to be over forever? No. But it's going to take two people who have not acted like adults deciding we're going to act like adults and wade into some really murky water and figure this thing out to get to the other side.

Okay, I agree. The hard part of our separation is she's so focused on a career where she's trying to establish a real estate, and that's the other part. But that's another story every day.

No, no, no. It's exactly what you said. You've created your own life. She's created her life. Did you ever see the office episode where Michael and Jim are co managers? That's y'all. Y'all are co managers of the house. And that is. That is a terrible place to build intimacy, raise a family, and create legacy.

What makes it messier is you guys already live together.

Yeah. Now you can unwind that.

And people call us, like, it's very mechanical now. You're right.

But at some point, you wake up and you go, wait, this is just, like, a cool roommate that I have to, like, beg for the bill from. I mean, that's not a fun way to live.

Yeah, I got you.

And are you guys splitting bills right now? Down the middle. And you, like, venmo each other?

How does this work, really? It started out because, again, we never really talked about it, so we're, like, roommates. So I kind of made the assessment initially, and I stopped at six months into it three. Three years ago, I paid, like, $1,000 towards her mortgage, basically, which was her mortgage at the time.

Wait, you live in her house?

Yes.

Well, this just got interesting, bro.

Yeah, I live in her house.

So you're about to get evicted?

No. You're gonna have to find your own place. And let me tell. Let me be honest with you.

I did stuff stupid. You know, you're in love. I got rid of all my foot, I guess. I give it all my furniture. I got. I did stupid stuff.

Okay. I want you. If y'all do end up separating, I want you to be a grown up about it. And we're not gonna, like, in the same boat here. Here's the deal. If George and I, I guess if this ever happens, that wouldn't be great. But if. If George and I were college roommates, let's go back that far. We would have better arrangements than y'all have.

Well, we'd be doing karate in the garage.

We'd be doing karate in the garage for sure. Right. And sword fighting on the front yard. But we would also have talked about clear expectations. Yeah, clear expectations. Who's paying what bills? Y'all haven't even done that. I hate to be the bearer of bad news, my brother. I am committed to reconciliation, but this one's going to take some skills that I don't know that you two have. We'll be right back. Hey, friends, it's Ken Coleman, and I've got some big news. The get clear career assessment is now paired with my new book, find the work you're wired to do. Every book comes with access to the assessment, so you can discover who you are and how you're wired. Then I'm going to show you how to use your results to get specific in your job search and find the work you enjoy. Preorder, find the work you're wired to do@ramsaysolutions.com.

Store.

And get the audiobook and the ebook free. Go to ramsaysolutions.com store.

Welcome back to the Ramsey show. I'm George Campbell, joined by doctor John Deloney. Open phones at 888-25-5225 well, our friend Rachel Cruz is on the road right now. She just launched her latest kids book, the second installment. I'm glad for where I am, a beautiful book about contentment, and I'm excited to read it to my seven month old. She doesn't really know what's going on, but she likes the picture so far.

Are you glad for where you are, George?

I am. I'm in the studio with John off the air.

You were just telling me you're not glad for where you are.

That's not true. Boldface lie. You sit on a throne of lies. You're not Santa Claus.

I think I was telling the truth there.

But hey, if you are in the Dallas area, good news for you. Rachel Cruz will be there tomorrow, April 20 at the Lincoln Park Barnes and noble from one to 02:00 p.m. So go join her. She's doing a book reading to the children's. And if you're just a grown adult with no kids and you just want to meet Rachel, you can do that. That's your prerogative.

And if you're ever wondering if. If he's real or not. Her smoke show of a husband, Winston has been seen.

Oh, he was in LA on the.

Laurel, so maybe he'll make a. Make a surprise show up also.

That's really why people would show up, to hope for a Winston sighting.

He's better at every part of life than I am.

He really is. He's who we all want to be. We're very jealous. But, hey, go see Rachel on her book tour for I'm glad for where I am. Dallas is the next stop, the 20th one to 02:00 p.m. Linkin Park, Barnes and Noble. And she'll love. And she's been telling us. She texted, said, hey, everyone's asking about where's John and George? And we have to tell her, but tell them that we were not invited.

We were invited. Someone's got to keep the show going.

That's right. Someone has to heal around the country. Robert is up next in Fort Worth, Texas. Robert, what's going on?

Good. How's it going, guys? Thank you for taking my call.

Sure.

How can we help?

So I am potentially getting ready to start doing a development deal on some property that I own here in the Arlington area. We're like a block away from this cowboy stadium, and I have currently no debt. We do as much as we can to stay out of debt, and taking on this construction load, obviously would be a considerable amount of debt. I don't have exact numbers yet, but I'm imagining right around a million dollars. The property, fully developed, would be, you know, worth 2 million plus.

What's your business?

You know, my business is not real estate at all. So where does this come from? I'm sorry?

Where did this opportunity come from?

Well, so long stories short, I inherited these properties. My mother and my father both passed away. I'm 37. My parents passed in my twenties. And, you know, all of a sudden going from, no, you know, not having really anything to managing, you know, things that I wasn't aware of. I didn't really do much right. I just kind of a hold pattern, be very safe with everything. We were mainly. Mainly focusing on the business, trying to keep it going. You know, after she passed away, we had to close her business, start our own, at which you asked earlier. We sell and dispense hearing aids and help people hear better. And so I have this property that when I inherited it was maybe around 100 grand. Now it's 370 something grand. This is just the appraisal value. I'm sure it would sell for a lot more. The proximity to the Cowboys stadium is what's driving this, because I know that this property is very valuable.

So what's your goal here? You have a property on that plot of land right now. What are you wanting to do?

Yeah, I want to turn it into a fourplex.

Okay. And whose idea was this?

That's right.

All I can tell you is what I would do. I would not take a. A gift that. That comes attached to the memory of two really important people to me and leverage it for a million dollar loan on a fourplex in the shadow of Cowboy Stadium. I would sell that property, and I would take the four or five or $600,000 you'll get for it. And I'd write a letter to my mom that I'm never going to send her, obviously, but I would thank her for her fidelity and her stewardship and let her know, mom, I'm going to not put my family on the block. I'm going to take care of this thing and honor this money. Thank you. That's what I would do with it.

Okay. And so the calculation between the selling the property, because currently we have our current business owner, no problem keeping the property as is, and, you know, just keeping my business on it. And, yeah, the selling the property has come up. It's one of those things that we do. We rent out part of the property for Airbnb. We also run our business, and we also have a parking business for the stadium on there. So we're really.

And this is profitable, I'm guessing, all of these things.

Oh, yeah.

What's your household income?

It's about 150 after everything. And again, you know, we're again, almost no debt. We only owe about 90k on the house. And so we're in a good situation and we're very blessed and we know this is.

And is your goal to rent this fourplex?

My goal is to sell. I want my son to have the benefit of what I had when my parents passed. I want. We just had a son. He's a year old now.

Won't he have that even if you stay where you are with what you have?

Well, like you said, to be a steward of it is not only to hold, it is to do what you can with it to improve. Right. And so I want.

But you have a cash flowing asset that's paid for. And you're telling me you want to go a million dollars into debt with a whole lot of risk in hopes to grow this asset.

Well, and that's. That's why I'm calling.

Well, and knowing without a doubt that by the time your kid gets to be 25 to inherit this asset, the cowboys will have moved somewhere. Yeah, right. Or they'll be doing some construction project and imminent domain this property anyway. You see what I'm saying? Like it. I would love to see you have $500,000 and put that away in a good growth stock mutual fund and hand him $10 million cash. Okay.

And your primary residence, you pay that off, that becomes an asset on top of your business. And so I'm not worried about legacy. I think behind all of this is also a little bit of starry eyed man. We can make some serious money here.

Absolutely. No, no denying that at all. But again, I'm coming from a place of ignorance. Right. I'm trying to find the best way.

I mean, we are not real estate experts, but we are experts on our opinion. And I'll tell you how Dave has built this place. He got burned in real estate. He had a few million in debt, as you probably know his story, going bankrupt in the eighties. And I'll tell you, a lot of people don't even believe this, but he cash flowed. This entire property that we're sitting in right now, we moved at the speed of cash. And he could have done it much sooner with other people's money. But he's been there, and he's done that. And the financial weight it carries, the emotional weight, the spiritual weight it carries, was not worth it to him to ever have to report to a lender ever again.

And, I mean, I feel that. Yeah.

So then it turns into, okay, well, how could we cash flow this million dollar project? Well, it might take us getting the income up for the business. What else could we do? How could we put away 200 grand for five years and do this five years from now? That's what I would be doing if I was in your shoes.

No problem. Okay.

So it might work out. You can do it your way. I'm not saying it's going to all. It'd be a house of cards. I'm just saying we've seen enough of these stories to know the starry eyed thing that looks good on paper ends up being the next call in the Ramsey show, where they went. We're a million dollars in debt, and this property's been a nightmare. And it's not cash flowing. Should we sell it?

Well, and that's. That is, I think the best thing I could tell you is what I would do in my own house. And that'd be really cool. If my parents passed away and left me a hundred thousand dollar piece of property that's suddenly worth five six x what it was. That'd be amazing. And I think that is, that in and of itself is beautiful. And I think when we don't have a psychology for what the word enough is or what a win is, it's easy to go. Yeah, what about this? What about this? What about this? And there's always some guy at the bar that's like, well, man, if I was you, I would. No, you wouldn't. You wouldn't. But it's cool to say it. When it's somebody else's money and somebody else's life and somebody else's memorial to their mom and dad, like, their stewardship.

And we don't say this because we're like, well, they work for Dave Ramsey. No, we say it as guys who had a bunch of debt and now don't have any debt. And we like this way a whole lot better. And nothing in our hearts wants to go back. So I hope that helps Robert making this decision. It's a big one. I hope you make the one that's right for you and your family. This is the Ramsay show. Welcome back to the Ramsay show. Our scripture of the day, psalm 80 611, teach me your way, Lord, that I may rely on your faithfulness. Give me an undivided heart that I may fear yourself. Name? Mark Twain said, don't let schooling interfere with your education. What a man of wit he was away with words. He had. I don't know why I talk like that.

John.

I'm sorry. I'm here with doctor John Deloney. I'm George Camel. We're taking your calls at triple A, 825-5225 Shelby is up next in Houston. What's happening, Shelby?

Hi.

Hey.

So let me get to it. So my husband had a business for about five years, and he recently closed that business in February. It was a construction business. He basically racked up about $176,000 worth of debt on material from one distributor. And that distributor is now suing him personally because he signed a personal guarantee for that debt, I don't know, a couple years ago, whenever he started to incur it. So my question is, do we. Does he personally file BakeR fee or do we use our home? We have a house that's probably worth between $320,000 and $350,000 and we owe about $90,000 on it. Do we sell it or get an additional home equity loan on top of what we already owe and make an agreement, you know, for the 176, try to get them to take less.

Is this all the debt you have?

Yeah, we really don't have a lot of debt. I have a car, but the car doesn't. It's minimal. I think it only has like, $8,000.

You have a lot of debt. I don't know if you missed the part where you have $176,000 in debt.

Yes, we do have that.

Plus 8000 on the car.

Yes. And then 90,000 on the house.

Okay. Let's remove the house out of the debt for now.

I want to take. I want to take bankruptcy off the table.

Okay.

Okay. What's he doing now?

Necessary.

What's he doing for right now for a job?

He currently works as an electrician. So he is working full time.

Is he making money?

Yeah, yeah, he makes good money now.

Yeah.

It's way better than when he had with the business.

And what are you working outside the home?

No, sir, I stay home with my kids.

Okay. How old are you? Two?

I am 32, I think. 32. And he's almost 40.

Okay. And what's the household income with his electrician job?

I would say yearly he's at like 115.

Wonderful. Okay. And what is his communication been with this distributor about the debt?

They are willing to negotiate some kind of agreement directly with us at the moment because it's not with collection.

Okay.

But they are, you know, currently trying to serve him and sue him for it, but they are willing to negotiate.

They're only trying to sue him. Well, they're all trying to sue him because he's avoided them like the plague has any.

No, this actually all recently just happened.

Well, did he think this debt would just disappear because he closed the business?

No, we actually. When he closed in, in February, we tried to make an agreement with them on, like, hey, we will sell, like, our equipment or give you the equipment, and you can have the money in return for the debt. And then they took, like, three weeks, four weeks to decide they didn't want to do that. And then they never called us to tell us they didn't want to do it, and then they filed a suit. Right.

So where's all the equipment now?

At our house, but there's not much. It's probably worth maybe, like, 30,000 altogether, what he has.

Okay, so if you sold everything, you could incite that wasn't tied down before you sold the house, how much could.

That net, you guys, his tools, his guitars, his fishing boat, like, everything.

Like 30.

Okay.

Our house is really the only thing we have value of.

Okay, so that knocks it down to 146. Could he then get on a payment plan and say, listen, here's my plan. I'm gonna pay this off in this amount of time, are they not gonna be willing to negotiate?

But they want somewhere between ten and.

$12,000 a month, which you guys simply don't have.

We just can't do that.

Now, how old your kids?

Six year old and a one year old.

Hmm.

I don't see a scenario where I think it's a terrible idea to sell your house. I think it's a terrible idea to go into bankruptcy, but I think it might be a situation where you're gonna have to go work for a few years, and he's gonna have to work and then work on top of that and then take side jobs on top of those two jobs.

And do you let it go to collections? Like, what do you.

Well, that's what I'm thinking. If they sue you and get a judgment, they're gonna do a forensic accounting of what you can actually pay, and they'll either garnish your wages or you'll have to turn over an x amount of dollars each month. And the judge is going to see you can't do $10,000 a month. And so here you do $4,500. It's going to end up in the same way for them anyway. And if you say, I can write you a check for $30,000 as a down payment, I will pay you $5,000 a month or $4,500 a month for the next x amount of months until this thing is paid off at 7% interest or whatever the thing is. And I'm going to make this agreement. I'll sign it. You got to remember that as far as they're concerned, your husband's signature doesn't mean a whole lot. Right?

Yeah.

And they may want to go get a judgment, and I don't blame them. And they may want to go take. No, no, no. We want a bank to secure this. I get all that. It is what it is. But what I don't want you guys doing is freaking out and running and jumping off a cliff just because you have this. This what feels like a sword of Damocles hanging over your neck when it's really not. Right?

Yeah.

So bankruptcy is off the table. Selling the house is a worse, worst, worse, worst case scenario.

If they garnish his wages, he's the only income for our house.

I think you have to. That. There's not going to be a way you get through this without your knuckles getting. Getting pretty skinny.

Either way, he's making huge payments to pay this off or they're garnishing it. Either way, you're going to have to learn to live on less.

And if you think that is painful, you having to go to work with a six and six year old and a one year old, I promise the bankruptcy proceeding will be infinitely more painful. Selling your house and going to a two bedroom apartment will be infinitely more painful than you going to get a job. Being angry every day. You're going to have to deal with your anger and your grief over this deal.

I just quit my job, okay? With my kids.

It may not work out because y'all are broken. Right?

Yeah.

And I get that. That's infuriating and enraging, and it's also reality.

Okay, so no bankruptcy. Worst case scenario, sell the house. Or.

And when I say worst case scenario.

We can make a payment.

I think you sit down and say, we'll write you a check for $30,000. And I think in the meantime, he comes up with another ten, and you'll say, we'll write you a check for $40,000 cash, and I will sign a promissory agreement for. I'll pay you this much you basically.

Create a new debt agreement for the next two years, three years to pay this off aggressively.

And if they say no, then all you say is we can't afford anything else.

Like, that's what we got, a 401k. Like use money from a 401?

No, you're gonna.

That will rob you of not only income taxes you'll pay on that, but also the penalty, another 10% on top of that. It's like borrowing money at 30 something percent interest.

Have y'all talked to an attorney yet?

No.

Okay. I would have that conversation because I, I can't give you legal advice. But it's my memory that a into the state of Texas bankruptcy doesn't include your home. So even if you file, I mean, they would lose everything. If you file bankruptcy, they don't. They have a vested interest in you paying them back to.

Yeah, we have more of a hand on getting them to take less than.

Well, I don't think you should get them to take less. I think your husband took that money. I think you all should pay it back. But I think you have to be honest about how you can pay it back.

It also might mean he is working an extra 30 hours a week. He gets his income up to 20 to. We're making 910 thousand dollars payments every month to pay this off. But that's not going to be fun.

Underneath all of this. A month ago, before you got this letter, this intent to sue, you had a picture of your life. You quit your job, he's making good money. You finally got out from a bad business he was working in. You've watched your husband just wither away. He closed the business. He got electrician's job. He's making good money. I'm gonna quit my job. I'm gonna be a stay at home mom like I've wanted to. And all that's gone now you just gotta own it and grieve it and own it. And then let's head right into it.

Let this be a lesson to all of you small business owners out there. When you call us and say, hey, we're no, we're gonna make money off of all this equipment. Don't worry, it's gonna be great. This is what happens. This is why we steer you away from taking on any business debt. And why you should run your business debt free. The entree leadership way. Because it creates more peace, less risk, and a higher chance of success. And even if you fail, at least you don't owe people hundreds of thousands of dollars. That puts this hour of the Ramsay show in the books. Thank you to John Deloney and all the folks in the booth. And you, America, will be back before you know it.

Hey folks, Dave here. You want to hear even more life changing content from Ramsay? Download the Ramsey Network app so you can catch all your favorite shows all in one place. Like the Ramsey show, smart money, happy hour and the doctor John Deloney show. You'll get real talk about life, relationships, money and your career. Plus, the app lets you browse by topic like debt, business or selling your home. Get the content you want whenever and wherever you want to listen. Download the Ramsey Network app today.