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 Ramsey personality, George Campbell, joined by my best friend and best-selling author, Dr. John Deloney. He's in the house. He's ready to help. We both are. So give us a call and let's talk about your life and your money and help you take the right next step regardless of what's going on in your life. Joseph kicks us off this hour in Los Angeles. Joseph, welcome to the show.

Thank you. How are you guys?

We're doing well. How are you?

I'm doing really good. My question is, so just give you a little backstory. My wife and I are debt-free. We're saving up for our fully-funded emergency fund right now, and then we plan on to start investing from there to fund our retirement. But yeah, so we're super blessed, grateful to be debt free. So my question is, though, how can we Can we be sure that the dollar is going to maintain its value over the next 30 years since we are going to be investing and following what you guys recommend in mutual funds 401k? Should we Are you worried about the economy? Or what do you guys' take on that?

Where's that question coming from? It's a question I hear all over the... I mean, I hear that question everywhere, and I've actually lost many nights sleep over that question. Where are you getting it from?

So I have some friends, and they're talking about Bitcoin and all these cryptocurrencies, and I'm not going that route. But when they say, Well, what about the dollar? I don't really have a good answer or rebuttal as to why dollar is going to maintain its value over something like cryptocurrency. So I just wanted to get...

So I guess it's coming from what is trending.

Just in the air, yeah. I'm going to give you my very primitive answer, and George, who's way smarter on this stuff, will give you a more sophisticated answer. Okay. Can I guarantee anything over the next 30 years? No. You can't. But here's what I can guarantee you. If the US dollar, if we woke up one day and the US dollar had collapsed as a global currency, as a localized currency, Bitcoin would not save you. Having an alternative, okay, we've got this special email account with these special zeros and ones and ones and zeros in it that say it's worth stuff. Because the world's debt is in US dollars. Bitcoins are bought and traded in US dollar. Everything revolves around that. And so when people are calling for the collapse of the dollar, I can't guarantee you it's not going to happen. What I will guarantee you is you'll be fending off your neighbor because they're going to be trying to kill you for your water. Or you're going to be figuring out how to walk 30 miles to work to an office that doesn't exist anymore because there's no gas to put in a car.

It will so change the way we do life for a while. As one of my buddies told me, he's a bank executive, and he said, because I was just peppering him with these questions, it was actually the response that freed me. He looked at me and said, Hey, man, I I don't have a meteorite plan. I don't have a plan for if the world gets hit by a meteorite, I'm not building that world up. I will deal with that if it happens. But until then, I'm going to do the next best smart, right thing that I got, which is buy real estate and invest wisely.

Right.

That's good. I think most people don't have what scorched earth it would be if Wall Street goes away, right?

Definitely, no. That's super good. All right.

That was my dragon's end swords answer.

What do you think, George? I fell asleep about three seconds in that, John. I know you did. I was bored. No, I'm just kidding. That was a really good answer. I have similar things to say, but I'll add to that and tell you this. I grew up in a very evangelical household. My mom can't wait for Jesus to come back, right? She sang the songs, she watched Left Behind. We were all in. My thing is always like, Jesus could come back tomorrow, and that could waste all of the effort I made trying to save up this retirement account. But also, what if it's not tomorrow? And I still have to feed my family. And I feel the same way about the crypto. Like, yes, the dollar could get devalued. I don't think it's going to collapse. If that happened, we're not worried about crypto, like John said. We're worried about trading for gas and ammo at that point. And so to your point, I'm going to invest 15% into mutual funds in the stock market because for decades and decades and decades, I know there's a large chance of a 10% return. With crypto, I'm losing sleep because 24/7, that number is moving and the goalpost is moving, and now it's down 50%, but now it's up 1,000%, and what if I had just gotten in?

Instead, I just want to live with peace. I want to sleep well at night. I got to go to work in the morning. For that reason, it's fine to keep those friends around. They're probably good guys, well-meaning, who want to take care of their families, too, but it's not a peaceful way to live. For that reason, it's fine to put fun money in Bitcoin, but I'm also not going to do it under the guise of my paranoia apocalyptic plan, that I'm going to be the one to survive it if I put money in crypto.

Hey, Joseph, I'm going to ask a question on your behalf to George. Is that right? Okay, he's smarter on this stuff than I am. George, I remember doing an event with Jocko once, and at the end of the event, he said to the audience, we were both on stage there, and he said, We talk a lot about military stuff. We talk a lot about might and Navy Seals' ability. But he said, The thing that the US has is the economics, the economy. As I dug into that, because I started asking people, Is that true? It sounds good from a stage, but is that right? What one finance wizard told me, and again, I'm asking you because who knows, but said, When a country says, We're going to devalue the dollar, and they have bought US treasuries, they have a vested interest in the US economy, that they actually are going to lower the amount that we owe them. The The advantage we have is if a country is like, We're going to try to crash the dollar, then the investments that they have made go away.

It hurts them financially.

It hurts them significantly. My understanding is the world's debt essentially traffics in US dollars. If a group of countries get together and like, Let's crash the dollar, you can do that. It may be to your advantage over 100 years, but it's going to be ugly because you're crashing the amount you're actually owed back.

Yeah. As much dead as we have, we have a lot of friends out there, John. They go, Hey, that's my friend. You don't mess with them because they're protecting us. It's a mess. You get into geo politics and economics. Joseph, I'm not smart enough to answer that question on that end, but I just tell you what I do, what John does, and that's investing in our 401(k)s and IRAs, paying off our houses, and sleeping well at night, not looking at our investments 24/7.

Joseph and George, that was ultimately where Joseph was. I was spinning out, man. I wasn't sleeping for weeks. I was asking everybody all the time. Ultimately, I came to, What can I control here? If it all goes away, if I don't owe anybody anything, then there's not going to be somebody knocking on my door and say, That's mine. Whether it's a car, whether it's a house, whether it's land, whatever it is. If I don't owe anybody anything, then there's not going to be somebody. Somebody might try to come take it, but they're not going to be saying, Hey, that's actually mine. That, to me, feels like the smartest hedge is, I don't owe anybody anything. Let's start there.

Joseph, thank you for a great conversation, man. Hope it helped.

Thank you.

Have a good day. You too, man. This is the Ramsey Show. We'll be right back. 888-825-5225.

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Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. The number to call is 888-825-5225. Alexis joins us up next in Des Moines. What's going on, Alexis?

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

We are excited to talk to you. How can we help?

Yeah. So my question is that I just started Baby Step 3, and I'm at a crossroads as far as where I want to live. So right now, I'm in a really low cost of living area. My rent is only 9:50 a month outside of Des Moines. I could renew that lease in August and stay there for another year, so that'll give me about 16 months to save up my down payment. But really, I think that my dream is to move to Boise, Idaho, which a lot higher cost of living area. I'm wondering if I should move out there in August, continue to rent and save up my down payment there, knowing it's going to take me longer, or if I should just stay put where I am for the next year.

All right. Is it just you? Are you single?

Yeah, it's just me. Okay.

When will you be done with Baby Step 3 when you have that emergency fund?

Well, so Baby Step 3 is done. I'm in 3B now. Oh, good.

Okay. You're in 3B, and you're saying, Hey, it's going to take, what, six months longer to get down payment goal for Boise if you move there?

I'm not entirely sure how much longer it would take me. I think six months is probably a good estimate versus where I'm at now. I think it would take me about 16 months. I guess about 22, I would say, if I moved to Boise.

Okay. Do you have a job in Des Moines that is flexible enough to move to Boise?

Yes, I'm in medical sales, so it shouldn't be too hard to find another position in Boise.

What's in Boise? Or who's in Boise is probably a better question.

Nobody is in Boise. I just took a trip out there before Christmas time, and I really, really loved it. I love hiking. I love the Mountain West. I'm still young. I'm only 23, so I'm pretty unattached, and I'm able to move if I want to.

Yeah. I mean, if I'm in your shoes, I'm moving. I would be moving this weekend. Because even if you were, I wouldn't tell you to buy a house, sight unseen anyway. So move there, rent, get to know the areas, save up that down payment. If it takes six more months, hey, at least you've been living in your dream city for a year, too.

Yeah, that makes sense. So your advice is even if it's going to take maybe closer to two years instead of a year and a half to save up to move out there. Yes.

And if it's going to take longer than two years, I would begin investing into your retirement plans 15 %.

Okay. And I'm already doing that. Not quite at 15 % yet, but I'm already investing a little bit into retirement. Great.

And this is assuming your income doesn't go up and you don't have any side hustles. And so if you're feeling that itch, I would work on getting your income up. And in medical sales, that's pretty easy to do if you hustle.

Correct. Yeah. I would have to look exactly at what the going rate is for my industry in Boise, but I would imagine it would be a bit higher than where I am now to adjust to the cost of living.

I love it. The other thing is, you could also get a roommate in Boise. You don't know. That could also help free up some margin to throw the down payment. True.

That's true.

I hadn't thought about that before. I had roommates up until I was married. It's not the most fun you can have, but it wasn't a deal breaker either. It saved me a whole lot of money that I was able to put toward my financial goals.

Right, 100%. It is nice that I don't have to have a roommate now just because rent is so inexpensive outside of Des Moines, but it definitely could be an option if I moved to Boise sooner.

Yeah. Find some community and get plugged into a church and Facebook groups, and you'll find someone to rent with. I think females renting together very different than males. Males are just gross.

I was just thinking, I bet you were the guy that cleaned up everything and complained about how nobody cleaned up anything.

I didn't complain. I was just secretly resentful. There's a difference. That is true.

You just had that smoldering.

I can't stand dishes sitting in a sink. I can't stand stuff just sprawled across the coffee table at the end of the night. Just bothers me.

I went to counseling, George, and I was healed, and you can be, too.

My OCD can be healed. Thank you for that, John. That's for a different show. Maybe the Dr. John Deloney Show. You should call into my show.

Why am I so hard to live with by George Kemp?

That's my wife calling in with that call. All right, Rhonda's up next in Washington. What's going on? How can we help?

Hi. I am a 54-year-old I'm recently divorced, and I have an opportunity to start taking my pension a little early. Currently, I have $270,000 in home equity, $385,000 I live in a 401k. My pension, I'm eligible to start taking it early. They won't let me take a payout. I know I've heard Dave say something about take the payout if that's possible.

If it's a lump sum?

Right. Okay. I cannot take a lump sum that's not eligible on my plan, apparently. But they do have something called where I can take a higher amount until in 62.

Okay. What's the amount?

It would be $2,000 a month until I'm 62. Then at that point, it drastically reduces out. It's a level income annuity.

Why are you wanting to take the early pension? What would the purpose be?

I'm thinking of taking it just to pay off the house early and make sure that I've got myself set up better since I'm on my own now.

How recent was the divorce?

A year ago.

Okay. And has the dust all settled from this? Yes. Okay. So now you're living alone. Are you renting? You've got the house. How much is left on the mortgage?

The house has worked for 420, and I owe 150 on it.

Okay. And what's your income?

I make 175.

Oh, amazing. So either way, you could knock out this mortgage in the next few years. Yes. I mean, you throw 50 at it, it's done in three years. Making 175, that's very doable. So was your goal. Let's say you don't take the pension, can you pay off this house in two years?

It would be a struggle, but probably, yes.

Okay. If you wait to take the pension, what is the upside of waiting versus taking it now early?

Taking it now early if the pension doesn't roll to anybody, it's not like I can leave that to my children or anything. If something happens to me, it's just gone.

But you don't get more if you wait?

I would get my monthly payment. It would go to a single annuity for the rest of my life, which would be $1,900 a month. It's not really that great of a difference.

I'd go ahead and take it then. I mean, 24K a year for the next eight years. That's serious. Right.

Okay.

But I'd have a purpose for the money. I was just talking to somebody in their 50s recently. It was just a personal family connection. Often, off of the back end of a divorce. The advice I gave them is the same advice I'll give you, which is, I can't think of a better place to start being 55 or 56 and suddenly finding yourself in a different marriage situation than you expected to have no house payment. At least that part is okay for the foreseeable future. That is both a financial risk, but it's also just a physiological risk.

Right?

Right.

Yes. Was this divorce expected or unexpected?

It was very unexpected.

Okay. There's going to be a part of your body learning how to redo life in a world where the ground just got pulled out from under you. It's hard to trust every next step. You're going to find your heart rate going up a little bit when you get mortgage statements. You're going to find your heart rate going up a little bit when you get whatever statements. The more you can pull those off the table, the more you're teaching your body, we are okay now. See what I'm saying?

Yeah.

If you're going to pull that 24 out, I would dump that right into the mortgage. I'd get that sucker taken care of and just give yourself a platform of peace. Okay, I've got housing taken care of for the next 25 or 30 years until maybe I have to go live in a retirement community or something. Got that. And nobody could take it, right? Right. And you haven't had an exhale like that in a long, long time.

No, I haven't. That's right.

Go get it. You're worth that. Freedom's around the corner for you, Rhonda. And I want this thing gone in 18 months if you're taking this early pension, and I think you'll get there and then max out. Every single contribution you can make to retirement, you have catch-up contributions you can make as well. I'd love to see you build up that nest egg and retire with dignity and then work because you want to instead of because you have to. It's a very different way to live, and we want that freedom for you. This is The Ramsey Show.

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Right now, you can download NetSuite's free KPI checklist designed to give you consistently excellent performance at netsuite. Com/ramsey. Welcome back to The Ramsey Show. I'm George Campbell I'm joined by Dr. John Deloney. I know a lot of you out there get questions about taxes, and we get it. It's confusing. It's not fun. So to help you get a better handle on them, we're going to unpack a question from one of our listeners. Here it is. I'm a new business owner. What are the most important things I need to do to make book Bookkeeping for my business easier? Well, first of all, congrats on starting a business. We love small business around here. We used to be one, John. I think we technically, by technical terms, we're still not a large business.

We're humongous, George.

Gigantic. And so bookkeeping can be a lot. If you're not already, one of the first things we tell people to do, John, is to keep personal and business expenses separate. So create a business checking account, your personal checking account, keep them separate, and then create a regular bookkeeping routine so you're always on top of tracking expenses, receipts, invoices, all that fun stuff. And the last thing you need to do is try to automate any processes with accounting software or by working with a tax pro. And we always tell people, if you've got a small business, I'm not doing it on my own. I'm going to get a pro in my corner to help. So it can pay to have a CPA in your corner. They can review your books, help you reduce risk, eliminate errors, maximize your tax deductions. And that means you can focus on growing your business because you didn't get into business to do taxes unless that is your business.

Hey, and listen, I don't have a lot of friends. It's not a huge secret. But listen, I- You have a CPA friend?

I do.

But before I sent all my stuff to my tax pro, I used Ramsey Solutions. As an employee here, we get it for free. Smart tax? Smart tax. I went through and did my own taxes, and it was almost to the dollar. The software is outstanding. I did it at my kitchen table, and let's be honest, not the smartest guy when it comes to numbers and money and stuff. It was clean, simple. I was glad that I got the stamp and the signature of a CPA, so I don't have to worry about it. Sure. But dude, that ramsey solutions. Com/taxpro, that software is legit.

I love it. Here's the deal. A Ramsey-trusted tax pro can help. If that's your boat, you need that level of support. Our team has already vetted these folks, so you know they're top-notch. So head to ramseysolutions. Com/taxpro to get started. That's ramseysolutions. Com/taxpro. Let's get to the phones. Kim joins us up next in Houston. Beachtown. What's up, Kim?

There we go. What's up, Kim? What's happening? Go, Stros. Kim, you there?

My husband and I... Yes.

All right, cool. What's up?

Okay, you can hear me. So my husband and I bought our Our dream home three years ago. We're scheduled to pay it off this year, and we're really excited about that. We'll be completely debt-free. But it's really difficult for me to feel a sense of relief given that our property taxes are really high. So even though, and I listen to your show all the time, I don't hear any guidance on property taxes. It makes me nervous to stay in this home knowing that our property taxes are high and probably will be high for the duration of our Well, it should only make you nervous if you can't afford it.

I know everything's bigger in Texas, and that includes property taxes.

It includes property taxes. They're pretty brutal there in Texas.

Can you tell us the number?

The house is worth about $900,000 to $950,000, and we paid $20,000 a year in property taxes.

So what makes you nervous? Are you angry? Are you nervous that you're not going to be able to pay the bill? If you're paying off a $900,000 house in three years, you'll have the money.

Yeah, yes, we do. The idea of paying someone else's mortgage pretty much every year or buying a new car every year just freaks me out. My husband doesn't seem to be worried about it.

Well, what's your household income?

This year, it's probably going to be around, you guys are going to probably laugh, but around 6:50.

Wow. I don't laugh at all. This is about anger. This is about how in the world, when it got cold, that We run out of power, and I'm paying this homeowner insurance.

Then I looked at what the property taxes were in Nashville, and then I got really upset.

Yeah, they're pretty low here. I moved from Texas, and it's pretty awesome. Not going to lie.

It's like maybe a 10th of that. But seriously, how should you think about it?

I mean, how should we think about it in terms of... I don't care how much money you make.

Why would you want to buy it? Why would you want to buy it? I would think about it in terms of all of the other frustrating expenses that you'll always have. Because we talk a lot about debt freedom and don't owe anyone anything. I I know people are always like, Well, you'll always have property taxes and insurance. I'm like, Yes. Number one, that's not debt. Number two, I look at it in terms of ratios. And so you guys make 650. How much of that 20K is eating up the 650? Well, it's likely a few percentage points. And so while it hurts to pay, you guys are in an absolutely amazing place where you have this huge income to support it. And therefore, unless that income goes drastically down, I wouldn't lose sleep over it. It just becomes another budget line item. We're going to put 1,600 bucks in this checking account every month in order to cover that bill at the end of the year.

Or just sell the house and move. But the one thing you can't do is just sit there and stew in it because you're making yourself crazy and you're making your home a place of tension and your marriage a place of tension. If you got to get out, get out. But otherwise, just say, This sucks, but I love this house. I love this neighborhood. I love this community. I'm going to move on with my life.

Okay.

I hate to be that black or white about it, but do you have another option?

No. My husband really loves their house, and every time I mention it, he says, We'll be fine. But I just wanted to know if there are any guideposts around it because We're still going to be required to spend $20,000. As the value of the house goes up, it'll just increase over time. He's considering putting in a pool. You want to pull in a pool once you pay off the house. I'm like, I don't know. It just makes me nervous to spend more money on that.

Can I ask you a quick question? I know some people on Reddit are going to roll their eyes at this question. Did you grow up with very much or not very much?

Not very much.

Often, if you don't grow up with very much, the adaption to ratios is very hard. Meaning, you still have a nine-year-old that remembers, wondering if we're going to eat tonight, wondering, is big sister Are those shoes going to still be stable enough for me to use them because those are the shoes I'm getting? You're a multimillionaire in an almost million-dollar home making more than half a million dollars a year.

We have one car.

Listen. For five, seven years. You are choosing to see the world through a lens of scarcity. Instead of choosing to see the world through a lens of gratitude. Look at what has happened for us. Often when people ask me privately, How do I get over this? I grew up with nothing, and now all of a sudden, I'm a surgeon. Now all of a sudden, my business exploded. What do I do? The Two things I tell them is to put in your budget, you will spend money on yourself every month as a practice. It's a spiritual practice. Because people can be as proud of the things they don't have as some people are of the things they do have. It's the same It's the same curse. The second thing is, I want you to be insane about tipping people. Not big, grandiose gifts. You can do that because you all are wealthy. But I'm talking about you and your husband go out and get a burger Go to Pappas Burger tonight there in Houston, and I want you to tip the waiter or the waitress $100 on your meal. And watch their face light up, and you're going to find that, oh, my gosh.

You'll forget about the property taxes.

Yeah, man. Look what we get to do. Then, yeah, it's an annoying cost. Living in Texas is very, very expensive. They don't tell you that on the brochure before everybody moves there. But it's expensive. Property taxes are bananas there. If you like living in Houston, you like the home, you're a multimillionaire, you can do what you want. I know you don't like that answer, but it is what it is.

Back to the math, Kim, this is 3% of your gross income is going to cover your property taxes. Let's say after taxes, it becomes 5%. Well, our parameters, because you're looking for one, is no more than 25% of your take home pay going towards housing expenses. You guys are well below that, even when you factor in insurance. I would sleep easy at night knowing this home is about to be paid off. You're going to free up that level of margin. What's your mortgage payment?

$2,000. We bought for $600,000.

Boom. Once you pay off this house, just see that money as we just covered the property taxes.

And become an advocate in your community for lower property taxes. Get involved at the local political level. Be a loud voice there. That's a good idea. But, man, just don't haunt your home through, I wish it was different, when it's not going to be different, right? Make a choice and then move on. Life's too short, And you have done too well for yourself.

Beautifully said. Thanks for the call, Kim. This is The Ramsey Show.

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This is The Ramsey Show. I'm John Deloney, joined by my co-host, George, the Man, Camel. The weird middle name. I know. We're taking your call on life and money, whatever you got. Let's go out to Orlando, Florida, and talk to Caleb. Hey, Caleb, what's up, man?

What's happening?

Good afternoon, guys. Thank you for taking my call. Sure. Big thanks to both of you all.

Thanks, man. I appreciate that.

So what's up?

I'm a little bit nervous here, so I'll try to keep my thoughts organized. First off, my wife and I have eliminated about 200 $972,000 worth of consumer debt in the past two years.

Two years? Wow. What do you do for a living, man?

I'm a lineman. So work on power lines. And we've been very blessed. I've had some big storms here and there that have paid well and was a major curse on us for a long time because we were spending every bit of it.

But A livestock pre-pitch you. You just made more and spent it all.

Yes. Started in the industry making 14, 15 bucks an hour, and got to the point where I was making a little over $50 an hour and felt like financially, we were in the same place we were at 14 or $15 an hour. Just had more stuff.

Sneaks up on you. How can we help today?

So my big question is, we just recently We actually have closed out every line of credit we had. We caught a podcast about making sure that you eliminate those open lines of credit, even if they have a zero balance. Cancel them and get them closed out. We have done that. We do not currently own a home. We're renting, and we have a piece of property that we owe about $60,000 on. Our dream is to finish paying the property off and eventually build a house. So the issue that we've recently run into through celebrating our no credit cards, no lines of credit, people have said, well, how are you going to build a house? How are you going to get a construction loan? So we started digging into it. And we have recently found out that there are, to our knowledge, no option for construction loans with a a NA credit score or a zero credit score. Would you guys agree with that?

Have you contacted Churchill Mortgage?

I actually did. I spoke with them yesterday, and they, to my surprise, we're in the same agreements with our local credit union. They said they do conventional mortgages every day with a zero credit score. But for a construction loan, for a new built home, you will not get a construction loan without them being able to see your credit history.

Okay. What would it look like for you to go the conventional route?

I believe we could do it, but we've got… The piece of property that we've got, we've invested a lot into over the years. It's about 18 total acres, so site development, current work. We love the property.

What's it going to cost to build?

In our area right now, to build a very modest, moderate house, we're looking at about 350,000. That's on the moderate side. And of course, we plan, like I said, to pay the property off. We'll have to have more than 20 % down to make sure that our mortgage isn't above 25 % of our monthly take home pay. But I just feel like this has put us in a little bit of a pickle, and we're looking for some advice on the right direction to go here.

Man, well, I'm sorry to hear that. That's a tough one. Construction loans are one of those. They're obviously more rare than the conventional side, and they're shorter term. There's more risk involved. You don't know how long these things might take. And so I get that it's a different animal to chew there. In your case, I'm wondering what it would look like to cash flow this process with your huge income.

Definitely possible, but it would definitely take a little while. I used to travel a little bit in this line of work, and the income was significantly better than it is now.

So what's the household income today?

Household-based salary My salary right now is right at 100,000. My wife no longer works, which has been a huge blessing. We've got three kids that she stays at home and homeschools, and wouldn't change that for the world. But my income still varies significantly. I mean, the past two and a half years, I've taken every ounce of overtime I can and have made right around $170,000 to $180,000 the past two years.

And your next goal is to off this 60K on the land?

That's right. That's our last debt, the 60,000 on the land.

You guys have an emergency fund in place already?

So we're on that step three. We've got about 7,000, so not quite our three to six months. Technically, that's what we're focused on right now. Immediately after that, we will focus on the- And are you renting? We are currently renting, yes.

Okay. I would just sit down with your wife tonight, look at the budget, and go, what would it look like if we pursued this path over here, and we tried to cash flow? We need to get the emergency fund. We want to pay off this land. We want to start saving up. That might be that this is a five, six-year plan instead of a one-year plan.

Right. Okay. Definitely, I guess my biggest question to add on to that, and I know you all never suggest opening a line of credit or debt, but both our local credit union, and I hate to even say it, but Churchill Mortgage even said, you may have to open a single line of credit.

In order to qualify for the construction loan, you need to have a version of credit history.

It's similar if you want to get even a conventional mortgage over, I think it's a $765,000 threshold, something like that, becomes a jumbo mortgage, and there's no manual unwriting for that one either. There is some weird quirks in I think it's- There's some outliers, like the construction loans, the jumbo loans. I think it's going to come down to you, man. It's between you and your family.

I definitely feel that our mindset and our look on our finances is completely different than what it was two and a half years ago. Sure.

I have a hard time telling a lineman who's got three kids at home who has just... I mean, You are the epitome of... You're the man that I want to parade in front of everybody across the country who tells me and George, you can't do it. And you're a guy who went and got a trade, and you got real good at that trade, and you said yes to every opportunity. You missed a lot of Little League games. You missed a lot of home stuff, baby steps. You missed all that because you said for two or three years, I'm going to bite the bullet and change my family's trajectory. It's amazing. That's right. But I don't want you to take out a construction loan that's going to vary, that they're going to tell you, Hey, 18 months, we could have this structure up. 24 months, you move in, and suddenly it becomes 36 months, 46 months. You're out there having to now float $170,000 salary Right. Against this variable mortgage. You see what I'm saying? Absolutely. That's the part that makes me nervous for you versus a conventional mortgage. It took us another year, year and a half, and that's really annoying.

We didn't want that. But, man, we got a lot more peace making this process. I got no problem if you get a mortgage, man. Get it all day long. All day long.

And you told me you paid off 272 in two years?

It's actually to the T, 272.5, and it's been right at two and a half years. And that has been, I mean, that has been grind like it never- So you know what you're capable of.

And so I'm going, okay, one more year, you could have paid for this whole thing in cash. And so I know it doesn't sound fun to go back to that level of sacrifice, and maybe you do it in four or five because you got three kids now and you're down to one income. But I'm telling you, it's possible. There's ways around it. You don't have to play the credit score game. And I believe you will be. You will have that dream. It just may not be in the time frame you are hoping for. And You got to reset the expectations there, but you're crushing it, man. Keep it up. We love to see it. That puts this hour of The Ramsey Show in the Books. I'm George Campbell. He's Dr. John Deloney. Thank you to all the folks in the booth keeping the show afloat. And you, America, thanks for listening. We'll be back before you know it. 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 George Campbell, joined by the host of the Dr. John Deloney Show, Dr.

John Deloney. We're taking your calls at 888-825-5225. If you want to talk about mental health, wellness, getting debt-free, building wealth, how to live a less anxious life, we are here for all of that. We'll help you take the right next step. Cynthia joins us this hour in New York. What is going on, Cynthia? Hi. How are you guys? Doing well. How can we help?

Good. I know this is a difficult question.

I I don't even know the answer to it, but I'm wondering if I should file for bankruptcy.

I really dug myself a really big hole that I'm having a really hard time getting out of, and I need to know what are the best steps that I can take to maybe not have to go down that route, but I'm in a bad place financially right now.

I'm sorry to hear that, and I hate that that's even on the table for you. I'll tell you upfront, most people that call in asking if they should file, we tell them, No, you can absolutely get out of this. It's not because we're just power of positive thinking over here. We have seen people get out of bigger holes making less money, and so we know it's possible for you as well. Tell us about your financial situation. How much debt are you in and how much do you make?

I make just under $95,000 a year. I actually own my home. I bought a home a few years ago. I'm a single mother as well. My debt between credit cards and personal loans is about $32,000 a year. My car is about... I'm sorry, 32,000 total. My car is about $32,000 total, and my car is about $17,000 that I owe. Just 150,000 total in debt.

Wow. Okay. Before George even talks, as of right now, I don't even know the rest of your situation. Bankruptcy is off the table. We're not even going to think about it. That's not even an option. If you were told me you were a million dollars in debt and you made 95,000, different conversation. You are going to be good to go. Cool? Okay. I know you think I'm crazy. I'm just telling you, you are squared up. You are All good.

You are about the average person that calls into the show, Cynthia. The reason I say that is because most people that call in, they have about half of their debt tied up. If they make 100, they probably have 50 in debt. When I started this program, I had 40 in debt, and I was making 40. It feels even more daunting when you have as much debt as you have income. What has led you to this place where you're like, I can't make these payments anymore? Is that what's happening?

Yeah, I'm paying the bare minimum. I did start the snowball method, so I was dumping some extra money into one loan or credit card at a time. I'm actually paid off one loan. Well, I'm going to be paid off $200 more. Good. So that's the next paycheck, that will be done.

What loan is that? I still have a long way to go. Is that your smallest one?

It's the smallest one since I really started trying to buckle down and get better.

Okay. Do you live in New York City proper or are you outside of the city? I'm right outside of the city. Okay. And you use your car to commute to work?

I do.

Okay. I do. What's the car worth?

Well, about 17,000 left on here. It's probably less than that.

I would check the Kelly Blue Book private party value just to see what it's worth. Because there's a whole bunch of options you can do before ever thinking about bankruptcy. But one option would be to sell the car and downsize and buy a cash car that you drive around for now. Because that would free up a third of your debt right there.

And that car would be embarrassing. You would roll your eyes. People would be like, But I thought you made a bunch of money. And you would say, Yeah, I'm free now, though.

Yeah. Is public transportation an option where you are?

No. My commute is about an hour to work, so I do need something reliable. I am a single mother. I need to make sure I can get my child to and from school. She's in a lot of extra activities and things. I do want something that's reliable and safe as well. But downsides could be an option.

Sure. Well, I'm just saying the price of a car doesn't have a ton to do with reliability. I drove a $6,000 car, and it's more reliable than my wife's luxury SUV that's in the shop right now. Okay. I say that out of frustration. I'm just saying you can find reliable, cheap used cars, and by cheap, I'm talking maybe $8,000, but it's better than being $17,000 in debt. That's one option. Are you investing right now at all?

I do have my 401k. That's really about it right now.

How much are you putting into that, percentage-wise?

About 4% of my salary, my income.

Congratulations. You just got 3,800 bucks back in your life every year because you're going to pause investing while we get out of this debt. Yeah.

I was thinking that I should do that.

So that's going to free up. Get this. You ready for it? You just got to raise a $316 a month back in your paycheck. Yeah, that sounds about- That you can now throw to your debt.

All right. Now, I'm going to really challenge you. You ready?

Okay.

How much are all these activities that your kid is involved in costing you?

Oh, gosh. I took a sacrifice and I decided to coach one of the teams so that she could play on it for free. I'm really not paying much for that.

That's one of the teams. That's one of them. What about the rest?

There is a team that's coming up.

It's going to be a little costly.

Okay, so maybe not this time because I'm going to tell you something. I look at it as an investment because I have a full scholarship for basketball.

It's not. You call her saying, should I file for bankruptcy?

It's the greatest scam on American families. If your kid is not in this soccer team when they're seven, then they're never going to get to the team when they're 12, and then they're never going to... It's not an investment. It's blowing up families. I'm a travel sports kid. I grew up that way. I make my kids do sports, so I'm not anti-sports. But if you can't afford it or you're about to do something that statistically is going to wreck you, which is filing for bankruptcy, the greatest gift you can give your kid is not another season of a thing that you're flying around our commute here, trying to get to this game, trying to move. The greatest gift you can give that kid is peace in your home.

This is true.

I know it's true. I know it's true.

It's definitely stressful, so there's not much peace.

Sometimes when you're a single parent, the The idea you carry around that guilt, you carry around that shame, and the idea I would ever, ever say no to my kid on something they want to do. I can never do that. I'm telling you, you got to because you can't afford it. But if you buckle down for the next 18, 24 months, you can say yes to everything after that. Okay. You see what I'm saying? Mm-hmm. How often do you all go out to eat?

More than we should. Probably, yeah. I've already tried to cut back on that.

I I want you to cut back to zero. No more going out to eat. Not until this debt's paid off.

I think switching the language, Cynthia, from I'm going to try, to I'm the person who's going to meal plan because I want to get out of debt that badly. Bankruptcy will destroy your life. This is not a get-out-of-jail free card. It will implode everything around you. I'm telling you, pause investing, cut up the cards, budget. I'm going to give you a one year of every dollar premium to help you on this journey.

And FPU. Let's give her the financial piece courses.

Watch all nine lessons. Have your kid watch it with you and go, This is the plan mama's on. This is why we can't do travel sports. This is why we're not eating out. And as you figure out ways to cut expenses, ways to make more overtime side hustles, you quit eating out, you pause the investing, you're going to find some serious traction with this debt snowball, and I can't wait to hear your debt-free scream when you're done.

This episode is sponsored by Betterhelp. Listen, if you can't even remember the last you had half an hour to yourself, be honest. Ask why. It's probably because everyone else's schedules, priorities, and emergencies are driving your life. And when you can't keep carrying that load, talking to a professional therapist can be a game changer. Therapy can be a place to work through your challenges with time, boundaries, commitments, and your own self-worth. Therapy can be incredible for figuring out what even makes you happy anymore and how to go make that happen. If you're thinking of starting therapy, try Betterhelp. Because therapy isn't just for people who've experienced trauma, it's great for building skills to be the best version of yourself. Betterhelp is completely online, so it's flexible enough to fit your schedule. Just fill out a short questionnaire to get matched with a licensed therapist, and you can switch therapist at any time for no extra cost. Learn to make time for what makes you happy with Betterhelp. Visit betterhelp. Com/delonie today to get 10% off your first month. That's Betterhelp, H-E-L-P dr. Ams. Com/delonie.

Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. If you're enjoying this show, be sure to check out all of the other great shows on The Ramsey Network, including The Dr. John Deloney Show and my YouTube channel, which you can find by searching George Camel with a K. We are firing out that content, John. Every week, we are feeding the beast, as I like to say. But it's working. People are getting helped because of it, and they're engaging, and they're changing their lives, and that's why we do this. We're taking your calls at 888-825-5225, and we've got our question of the day. In the meantime, John, it comes from Kelsey in Georgia. What does Kelsey have to say?

All right, Kelsey writes, We have a family member that is seriously dating someone and will probably get married in the next two years, but they aren't engaged yet. I love it. So good.

That's going to stop. There's a lot to unpack right there.

We are seriously dating. They're not engaged. Maybe they'll get married in two years. Probably. That would reduce the seriousness to which they are dating. But alas, should we allow the boyfriend to be added to the family's cell phone plan to save him $50 a month? This is going to be the fastest question of the day answer ever.

Hard no.

No.

That's weird. You don't add them to your other bills for him to save money. It's just- It's so great. Maybe you share the Netflix login, but that's about the extent of it.

And by the way, when he gets married, him and your family member start their own family plan. You don't add new... What, man?

If he needs to save 50 bucks per month, there's cheaper cell phone options out there. So if he's still paying and he's then saving 50, he's probably paying upwards of 100 right now.

Yeah, just don't. They discussed this cleanly in Ghost Rhostbusters. Don't cross the streams. Everything bad happens when you cross it. Just don't.

Then it gets weird because they break up. It's already weird. But he's still on the phone plan.

He's on the phone plan, and he just decides, You know what? I'm not going to pay anymore. Oh, boy. Just don't. Just don't. Just don't. Just don't. Just don't.

Not worth it.

Never. When they get engaged, no. When they get married, kick her off the plan. They get their own plan. Nobody's joining your phone plan. Ta-da.

That was easy. Man. Thanks for that, John.

We should have one of those easy buttons.

They're They're not going to give that to us. They won't. You can't be trusted with it, first of all. I agree with that. You'd be hitting it all the time for no reason.

All right, let's go to Savannah in Melbourne before George hurts my feelings anymore.

What's going on in Florida, Savannah?

Hi. Thank you so much for taking my call, guys.

Absolutely. How can we help?

My question is, should I go back to work, and would that be the best way to get our family finances under control? Obviously, I can unpack that.

Sure. Are you staying at home with kids right now?

I have a one-year-old son, and I have a baby on the way. She's due in late May.

Party. You're saying, I'm going to go back to work right now?

Well, right now would be after the postpartum period. Okay.

We're saying by the fall, you might go back to work?

Yes. Okay. I've got birth costs that will be due in a couple of weeks to my midwife. It's about $3,000. My husband's an airplane mechanic, and he makes gross about $56,000 a year, though that varies a lot because sometimes he has overtime. He has his own business on top of his employed job, but he puts all he makes into his business. He has a toolbox debt that he got when he was in school, and then tools, et cetera. We are homeowners. My mom bought She bought the home and she owns it with us, and she gives us a really good interest rate.

Wait, hold on. Hold the phone. So whose name is on the mortgage?

Well, it's not a mortgage. I just pay my mom.

It's your mom's real renter, and it's your mom's house.

We are all on the deed, and she bought it cash.

Oh, she bought it cash? There's no mortgage. Both of your names are on the deed. No, there's no mortgage. What happens when- She gives us a really good interest rate because she made up the interest rate. Oh, my gosh. Wait, I'm so confused. You're paying a fake mortgage payment? Why not just- Yes.

Just unzealing her is all.

Oh, gosh. Okay. That's a story for another day.

This is going to go bad in so many ways.

It means that we can afford to have a home With a- But you don't have a home.

But you don't have a home. You're renting from your mom. But, hey, let's hold our conversation. Here's the deal. Your husband has another business that he's trying to build the business. He's got a baby coming, so he needs to pay for his baby.

Yeah. The business doesn't make money.

You all made a choice to get a midwife. I don't knock that choice at all. My wife got one. She got one as well, but it's expensive.

I'm very anti-hospital bird.

But you can have these philosophical points. I'm anti this cool, but that anti cost a lot of money, and it doesn't work with insurance.

I will be reimbursed most of it, but it's obviously after the birth, and you have to be out that money.

Yes. Maybe your choice Maybe your choices mean you got to go back to work, or maybe your choices mean your husband's got to stop investing in his business and pay for his wife and baby to be born. All these are just choices.

How much debt do you guys have right now?

We have $14,000 of debt, and half of that is medical debt for my one-year-old. He was hospitalized. That's another point that I have, is if I go back to work, then we would have to look at childcare. There's a cost But then also every time my son goes to the nursery at church, which he's never been in daycare, but the nursery, he gets sick, and then that caused him to have to be hospitalized. Then it just meant that I had to stay home a bunch, and then I've had to pay for prescriptions and doctor's appointments, and he just gets sick a lot.

You guys have good health insurance?

If I have two kids, then we do, luckily. Okay.

Are you going to hit your out-of-pocket to where you know what your limit will be?

Unfortunately, the timing of when my son was hospitalized made it that it started over this year. Reset. I was like, Oh, I'm not going to have to do it again.

That stinks. Okay, so you guys make 56k total per year, and you have 14,000 in debt.

Unless my husband decided to pay himself.

Which I would advise him doing.

Yeah, because he has a baby on the way, and he's got another baby in the hospital.

I would pause everything right now and just make minimum payments on your and stack up as much cash as you can until baby's here, you and baby are healthy, then we'll restart the debt snowball. Then we'll look at what it's going to look like. Should we go back to work? Is it going to make sense with the daycare costs? Because having two kids in daycare means We need 1,500 of our net income going to daycare. You're going to have to sit down and do a budget with your husband and count the cost for that and see if it's going to be worth it. What could you make if you went back to work? Were you doing something before career-wise?

Okay, I was, but I hadn't graduated by that time. Then I was pregnant with my son when I was in school. The job that I had was 17 an hour, but it was at a marketing firm. My degree is weird because I have a minor in digital media, and all my courses are digital media courses, but the course itself is called Bachelors in General Studies, but it's essentially digital media.

My first degree It was in Humanities. It didn't matter.

You have a degree, though. Okay.

Yeah, it doesn't matter.

It's a box they check in some interview process. They go, Cool, you have a degree. What they're really looking for is, Can Savannah do this job that she applied to do? That's your job to prove that to them. I think you're going to have to count the cost because daycare may end up costing 25 an hour of net income. If you're not making that, it's going to cost you money to have your kids in daycare.

But the other side of it is, and this is something you've been avoiding. You've been avoiding. I'm only telling you this because I love you, okay? You've created a world where we can't do that because he just gets sick every single time. Statistically speaking, that's impossible unless he has an autoimmune disorder, okay? Every time he does this, we can't do that, and we can't do this, and that's not going to be. You've created a world where you are allowing the world to happen to you, and you're slowly feeling yourself getting buried. I don't want that for you, and I believe in you more than you believe in yourself. It starts with what George said. This is going to sound counterintuitive, or you're just saying that because you're on the Ramsey show. It starts with you and your husband sitting down and making a budget because the budget is going to force you two to say, Okay, we want to hate the hospital system. We cannot afford a $3,000 midwife to have a home birth. We can't afford that. It's going to force you to decide what you actually believe and what you can afford and where those two intersect and then what you're going to do next.

So hang on the line. As a birth gift, we're going to give you financial peace, university, and every dollar app. But you all got to sit down and use the tools, and they will help you, I promise.

Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. The number to call is 888-825-5225. Nathan joins us up next in Richmond, Virginia. Nathan, what's going on?

Hey, can you guys hear me good?

Yes, loud and clear.

Awesome. Hey, thanks for having me on the show. A long-time listener. Not as good here in the last couple of months, but I was calling because I think I'm going to be out of debt here soon whenever I get this bonus in May. But I've been out of debt before, and I went through your program. I don't want to be too long-winded, but I used to live in South Carolina. I met my wife. We were in debt. I got us out of debt. We saved up some money. We moved to Virginia. We bought a house. And then life just came down pretty hard before I got the emergency fund going. So I took on some debt. I didn't know what to do. And now I'm sitting here with almost twice as much as I had the first time. And I want to get back to being intentional about breaking it down. I know what to do. I've done it before, but I'm worried that whenever I get to baby step three, it's like you got a brand new paycheck. You almost double the amount of money that you have. And I just didn't do it I'm just wondering if there's anything that I should be doing now to prepare my mindset before I get there here in a few months.

Well, I think this is as much an emotional call as it is financial. I'm going to let John address that. I think you don't trust Nathan anymore because you backslid. There's some shame and baggage from that because you're like, Man, I worked so hard to become debt-free. Now I have more debt than I did, and now I have a family, and this is just different. Is that what's going on here?

Yeah, for sure.

That's tough, man.

There's something else at play here. What is it, Michael?

Nathan, are you with us?

Nathan, I'm sorry. Nathan, you there?

Yes, sorry.

I read the wrong name on the board. There's something else at play here.

I don't know, man. We got married. My wife has a job, but she doesn't really make any money. She works her own business, and she keeps herself afloat. She's an athlete. And I promised that I would be able to provide for her, give her everything that she wanted. Is that how you got into debt? I wanted to buy this new property. No, I don't loan her any money or give her any money. And she runs her own business, and she is really good at her finances. But she basically says, You make the money, you pay for the house, you pay for everything that we have here. I'm going to do my best to make sure that I don't pull any money from what's coming in. I just don't feel like I've really been a good steward to her as far as taking care of business.

Nathan, I don't think that's it. Man, I wish I'd said it out loud first. You sound like a guy who opened his eyes and found himself running parallel lives with his wife. You all aren't doing this thing together. You've taken it all on your shoulders, which is noble, but you can't carry it all because you don't make enough money.

Well, we do really well. I live on 45% of my income, but I'm a spender.

Where's the other 55 going?

We were on board whenever we did it the first time.

I'm sorry? Where's the other 55 % going?

Right now, it's going towards the debt, at least 40 % of it. I spend one paycheck that pretty much covers us for the month, and the other paycheck I allocate to what we got going on.

So how much debt do you have versus how much you make?

I make $3,600 a paycheck. I don't know what that comes out to. I'm in the military, so I have non-taxed income, but my W-2 is $90,000 a year. Okay. And I have $56,000 in debt.

What debt is this, if you listed it out?

I have $15,000 on a vehicle that I bought for her after her last truck blew up. And then I have a motorcycle. And then I've got some left on the loan that we took out for the wedding, and then the rest of it is on credit card.

All right. You told us at the beginning of this call, dude, that life just hit you in the mouth. It didn't. Life didn't hit you at all.

You had a wedding. My Which, well, the wedding, we only paid $7,000.

I'm just saying you had a wedding, you got a motorcycle, you bought a truck. I mean, you made some choices, and then you gave yourself zero margin, and then your air conditioner went out.

Well, that's not the timeline, but that's fair. I had to buy the truck, or she can't do her job. I did not have to buy the motorcycle.

What's her job?

She is an equestrian athlete. She needs a vehicle to be able to move her horses up and down the country to do her job.

But you said this business does not make money.

And she's committed to not pulling from the family finances until you get out of debt.

No, it breaks even. It's net zero. She covers herself for her gas.

So it's a hobby. It's a hobby.

It's 100% it is not a hobby. She is an Olympic-level athlete.

I'm not trying to diminish her- We're saying financially. Her capabilities. She's amazing. I'm just saying it's not making money, so it's not a business, or it's a business that's going under, or it's just barely staying afloat.

What was her W2 this year?

She doesn't make an income.

Therein lies the problem, my friend. You went into debt for a business that doesn't make revenue. And now the truck is depreciating and you have no way to pay it. So I think we need to call what it is. I do have the money.

I I understand, but I do have the money to pay for it. But most of the debt that came was because of me. I've got $22,000 on a credit card. She didn't do that.

What was the credit card money spent on?

I spent $16,000 on the HVAC and the rest of it I spent on myself because I thought I deserved it.

I think we need to have a come to Jesus meeting tonight with her and go, Listen, and this is not on her. This is on you just as much. You need to say, I have not done a good job leading this area of finances. This situationship where I've been floating the business and I've been trying to cover our bills, it has not been working. We need to do a different plan. I need you to go make some money right now for our family so we can get out of debt.

I can't do that.

Why?

She's an Olympic-level athlete, and I make enough money to get out of debt, and I am getting out of debt. I'll be out of debt in the next six months.

And what's to say you're not going to be back in it when she needs a new truck for her business?

I I just don't really see what that has to do with that.

It's not a- You called in saying, How do I make sure I never go into debt again? I think we need to get to the root of the problem.

What is the question?

Well, my question is, whenever I get out of debt again here in a few months, the problem was, I had the emergency fund, I was building it up. Then every time I got somewhere around $10,000, only around three months, I had $10,000. I was like, I want this thing. That's what I spent my money on because I've never had a savings account. I've only ever had the emergency fund, so I treated it as a savings account. I'm wondering whenever I need it out of debt- I'll tell you right now, Nathan.

Until... Dude, listen, George and I are all on team Nathan. We don't win if you don't win. I want you to win this thing. I want your marriage to be amazing. I want your wife to go win a gold medal. We're not coming at you. And your voice as though we're trying to attack you. We're not. But you have remained untethered from reality. What I mean by that is, you're not the worst husband in the world, and you walk around as though you are. You bought some things on a credit card when you knew better. That doesn't make you the most evil guy in the world. You made some dumb purchases. You didn't have any margin, and then you needed $16,000 for an HVAC system. That hurts. You are carrying the weight of this This hobby that's an amazing hobby. It's so good, and I want her to win so I can do the national anthem in my living room on her behalf. But you can't afford it right now in the current iteration with which you're trying to do it. I think the conversation is sitting down with your wife saying, I'm drowning, and I need to at least come up with a plan.

Will you help me be on a part of this plan, a part of this budget? Then when you get $10,000, no. All right, this is when I usually blow it. I'm going to take extra steps. I'm going to put some hurdles in the way that I don't blow it time. But you've got to come down and have a conversation with reality because, brother, you're going parallel lives with this person, and you all have to come together and do this thing together.

I'm not going to tell you to sell the horse, but I will tell you to sell the motorcycle, Nathan. Best wishes to you. Here's the thing about investing advice. You can find it just about anywhere, but that doesn't mean it'll always help you with your personal goals. Here's another option. Check in with a smart investor pro. These financial advisors can review your plan or help create one that's personalized to you.

To find a SmartVestor Pro in your area, go to ramseysolutions. Com/smartvestor. Go to ramseysolutions.

Com/smartvestor. Ramsey Solutions is a paid non-client promoter of participating pros. Learn more at ramsey solutions. Com/smartvestor. This is The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. If you're enjoying the show, don't keep it to yourself. Don't hide it under a bushel. Just go ahead and hit the share button, hit the subscribe subscribe button, hit the follow button, leave us a kind review. All of that stuff would mean the world, and it helps us spread the word, helps the algorithms love us.

What is a bushel, George?

You don't know the old saying, don't hide it under a bushel. Don't hide your light?

I remember the VBS song from when I was a little kid.

That's what I was referencing.

Oh, you don't want to hide it under that either? Yeah.

When people ask me, Hey, why don't you wear hats? I say, You don't hide this under a bushel. And I point to the hair. They never laugh. It was exactly your reaction, and that's why I do There we go. Off to the phone lines we go, because if we don't have your calls, then it gets awkward on this show. So thank you for calling in, America. Carol is up next in Sarasota. What's going on, Carol?

Hi. My husband and I are a little late to the party, but- George is always late to the party, so you're in good company.

I don't get invited to the party.

Because he's too busy fixing his hair. Exactly. That's okay.

He doesn't hide under a bushel, that's for sure. So how can we help? There you go.

Well, my husband is 67, and I'm 62, and he does not have a retirement plan because he's self-employed. I was wondering, we paid off all of our consumer debt, and we're just trying to knock out the house now. I'm just wondering if I should up my contribution to my 401k. I have a Roth 401k, and I didn't know if I should up my contribution to make up for him not having one.

Well, who told him that he has no investment options as someone who's self-employed?

Nobody did.

Because there's tons of investing options.

Not to kick you while you're down, but the way you phrase that was like, he doesn't have it because he's self-employed. It's like, no, he didn't have it because he didn't save it.

Well, that, too. Okay, there you go. All right. We made a few mistakes along the way, and we're getting our act together in the last few years.

All right, good call. How much do you owe on that mortgage?

We're down to 178.

Okay. What's the household income?

About 200.

Wonderful. Okay. How much are you guys currently investing out of that $200,000 income?

15% is going into my Rothsler 1k. Okay. I also maxed out my USA.

Wonderful.

For the year.

Then he's not doing any investing.

Then the rest we're throwing at the mortgage. Okay.

What business does he have?

He does consulting work.

It's a solo business? Yes. No employees? None. Okay. Have him look into something called a Solo 401(k).

Okay.

This is a great option for him, and he can put away a lot of money in order to start saving for retirement. For anyone out there that is self-employed or they don't have a traditional retirement plan, there's tons of options. Number one, the Roth IRA, as long as you're under the income limit. Even then, you can do what's called a backdoor Roth IRA, where you fund a traditional IRA with after-tax money and then convert it. The other option is a SEP IRA, Simplified Employee Pension IRA. The other one is a simple IRA, and then there's the individual 401k that I mentioned, the solo 401k. There's tons of options out there. I want to encourage you that now I take that 67, and he's just hearing about this now. That's a bummer. But it's still going to with a $200,000 income and you guys continuing to work, you can have a solid nest egg.

All right, so I want to ask George a question, Carol, on your behalf. Is that cool? Okay. All right, George. We've got a 67 and a 62-year-old. Retirement is big. They're playing catch-up. Carol, how much do you have in your Roth IRAs across the board?

About 100. Well, some of it is in a traditional because I only started the Roth since I got on board with the DPR and the plan.

Sure. What's the total portfolio?

Altogether, it's about 150,000. Okay.

George, when I'm looking at their total risk profile, it feels like the thing that I would love to give them when he turned 70 and she turned 65 is a paid-for house.

Oh, absolutely. That's the number one goal.

This late in the game, if you're having to choose A or B, I feel like, let's dump everything we can and get this house paid off, or are you still doing 15% at the same time?

I would still do the 15%, and then anything beyond that, aggressively attack the mortgage with.

Almost baby step too aggressive. That's what I'm doing.

I just want I want to make sure if I- This is not like a seven-year plan to pay off the house.

This is what would it take to pay this off in three years.

Yeah, I'm hoping to get it done literally, maybe by the end of this year because his income just tripled in the last year.

Oh, Wonderful. You're saying get the mortgage knocked out in a year?

I think we could. Wow.

Do it. You're going to have peace that you did not even know.

It'll be very close to it. Wonderful.

Who makes the lion's share of that $200,000, you or him?

Well, it was me until just this last year.

Was it just an anomaly year or did he hit a new level with his business?

He had a new revenue stream. Yes.

Love it. Excellent.

Okay. Well, if he can keep that up and you guys can knock the house out, and then you can invest as much as is possibly human. Right. And that means maxing out every retirement option available, catch up contributions, even a brokerage outside of retirement to help create some cushion for that nest egg. And what's your mortgage payment?

Because I live in Florida and the insurance is ridiculous. Well, I'm paying an extra $300. Well, automatically, I'm paying an extra $300 on the payment. Well, we are.

Not I. But what's the total for the principal and interest?

$3600. Okay. Is the payment.

You'll free up a majority of that once you get this house paid off?

Yeah, we'll need to put away about a thousand a month for taxes of insurance. Great.

So $2,600 gets freed up that you can now invest after the year's up. That gives me great hope. With that amazing income, you both will probably have to work for a few more years in order to make this happen. But with no mortgage payment, that lowers your expenses. It lowers how much you need in retirement.

Absolutely.

All right, Carol, this is going to be annoying. I want you to hear me. This is a cornerstone of of American culture that we've just thrown out, and we're all leaning over because we don't have this cornerstone anymore. That is reality. The reality is your husband chose to be self-employed for a long time and didn't put any money away. Oh, yeah. The reality is... What that means is you all are going to be making a bunch of money, and your friends who are in these same circles are going to be 65, 66, 67, 70, and they're going to have been retired hired, and they're going to have put money away for years and years and years, and that's not going to be you all. Right. Just know that that frustration will be there. What catches people off guard is I get so just angry that I'm making this much money. I should be sailing into the Bay, and all my friends are, and I'm working, and that's the reality of the situation you find yourself in. It's okay to be angry or frustrated, but then you got to go do the next smart thing and not just have a weekend where you go blow 25 grand doing X, Y, or See what I'm saying?

Oh, yeah.

Absolutely.

Awesome.

Yeah. My husband actually thinks he's never going to retire.

Good on him.

He likes to work. Good on him. I'm like, Yeah. I always told him he could not retire.

I love it. Well, the goal is he can work because he wants to at some point, not because he has to. Right now, it's a little bit of both. I think there's a little more peace in not needing that. So, Carol, what I'm going to do for you is as a gift to you guys, I'm going to give you free tickets to our Investing Essentials virtual event. It's happening May 21st and 22nd. It's 200 bucks, but for you and your husband, I'm just going to gift it to you. So hang on the line. Skyler will pick up and Taylor, and they'll get you virtual tickets to that event. For anyone out there who wants some confidence in their investing plan, whether they're 22 or 62, Please join us for this event. I'll be joining Dave for a two-day. We're going to do about two hours a night, May 21st and 22nd. It's called Investing Essentials. We're going to cover Dave's personal investing strategy. We're going to help you understand all of your investment options, even if you're self-employed, help you maximize your 401k, help you figure out how to choose mutual funds with confidence and plan for that retirement, even talking about real estate investing.

That's something that is something Dave has done very well. We have a very countercultural approach that will allow you to build wealth with a lot of peace. Go to ramseysolutions. Com/events to get your tickets for the Investing Essentials virtual event. You can join us from anywhere in the world. It's going to be a good time. Ramseysolutions. Com/events.

This is Dave and George not hiding this information under a bushel.

We're not going to gatekeep anymore, as the kids say, John. No.

We are- We're spilling the tea. Cutting the bushels to the ground.

There's no cap. We are spilling tea. That's what they- I don't even know what that means. Ask your children. They'll probably tell me that I'm three years too late to all of those sayings. That puts this hour of The Ramsey Show in the Books. Thank you to my wonderful co-host, Dr. John Deloney. I could not ask for a better co-host unless Ken Coleman or Rachel Cruiser, Jade Warshaw were here. Thanks to all the folks in the booth. Thank you, America, for listening. We'll be back before you know it. 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 George Campbell, joined by Dr. John Deloney. This is your show, America. So give us a call at 888-825-5-2-2-5, and we will do our best to help you take the right next step with your life, your relationships, and your money. Kelly is going to kick us off in Little Rock. Kelly, welcome to The Ramsey Show.

Thank Thank you.

What's going on?

My husband had a car accident last week that I'm being told is leaving him paralyzed and with brain damage. Oh, man. On top of everything else because of all of this, now I'm trying to figure out. He has his own business, so I'm trying to figure out how to deal with his business and finding out that there is a whole lot of debt I didn't know about that he's been hiding. I feel like I'm in a freefall with everything. We've got five kids on top of everything else.

I'm so sorry, Kelly.

Do you have Do you have somebody that is also a part of that business that can step in?

Not well. I mean, trying, but they can't.

They're not What business is this?

It's not the same. It's a car lot.

Okay. Well, here's what I'm saying. If he has a traumatic brain injury and he's got compromised mobility now, possibly forever. And by the way, they're going to tell you worst case scenario right now, okay?

It's a complete spinal injury. Okay.

You're looking at years of challenge ahead of you, right?

Yeah, exactly.

Trying to keep Let me just say this. I would make as few decisions right this second as possible, okay? Because everything is in chaos right now. Do you have a mother, cousin, sister, brother that can come down and just be a person who can hear things that's not so clouded in smoke right now?

Yeah, I do. They're trying. I think I've freaked them out, too.

Well, you're allowed to. You're allowed to. Everything is chaotic and up in the air and scary right now, plus your mom with five kids, and everything just changed. You're allowed to be upset and angry and raged out and whatever emotions or feelings you have, they're all good right now. That's why you need people who care about you and who love you and who know you to also get in there and make some of these like, Hey, what bill do we have to pay right now?

What's the age range of the kids?

Five to 17.

Okay. What's your financial situation personally? Do you have money in the bank? Do you have any debt?

Well, I have, personally, just me, our financials are mixed and not. So I just have 5,000 for a credit card debt that I could pay off with what's in the bank.

Okay. How much do you have in the bank?

Thirteen thousand, maybe.

Okay.

Plus my kid's savings account.

The debt that he was hiding from you, I assume that's all in his name and none of it is in yours?

I think so.

Okay.

I don't think. Does he have a business manager at the lot?

He was in.

He was a business manager.

This was a solopreneur venture?

Yeah, he had a secretary. Okay.

Does he have an accountant that did his taxes? Yeah. Okay. Let's get down with the accountant, okay? Let's bring your sister or your brother or your dad or his sister or brother or dad, somebody or mom, somebody who can sit with you guys and hear, get a true count of what's actually going on here, okay? Right. The greatest gift you can give to those around you right now is to know I'm not seeing the world as it truly is because my world is blown up. My husband is laying there in the bed and they're telling me he's never going to walk again. I got five kids. I get emotional, and I've not ever been in anything near that situation. But when I get overwhelmed, I've got two or three men in my life that I trust to step in. I say, Is this real? Is this not real? What would you do? I lean on them, and that's what community and friendship and love and care is for. Just this moment, okay?

Okay.

You have a question we can help you with?

I need to figure out where to even start with all of this.

Okay. Make no decisions for six months that are not- I don't have that option.

We're going to run out of money by the end of the month if I don't use that.

That's what I'm saying, that aren't about keeping your lights on, okay? If you're going to run out by the end of the month, then we need to sit down with tax guy, somebody else who knows something about the of this business. Okay?

Okay.

Does he have any money in the business that you could use to support your family?

I've got a counselor It's receivable, and I've got some inventory in the bank, but he's got a floor plan that's coming due every week or two weeks.

Does he have any form of life insurance or health We've got health insurance, but there's no life insurance.

I've got Afflex, of all things, that I'm hoping it's going to… I don't even know if it'll pay out. I don't know if comp will pay out. I can't rely on any of that.

Yeah, but that's what it's for.

There's very little that's liquid.

The liquidity is going to be your issue, okay? Sometimes you call the bank who's got notes coming due, and your tax person can help with this, but the notes coming due, you call them and say, Hey, the person who would have made this payment is now in a hospital bed fighting for his life. It's going to take a minute. Okay? Okay. Give yourself some... The more proactive you are on these calls, the better. If you know of a couple of things come and do, I'd call them. If they need hospital records or whatever they need, get them the hospital records they need.

What is your income, Kelly?

I would substitute teaching, so it's $100 a They've already told me that I'm not going to be able to work because he's going to need all the care. Full-time care. Yeah, exactly.

I know, but listen, this is why you got to have people because that is in 30 days or in 45, when he gets discharged from the hospital, and all of that feels like it's happening to you right this second. It's not. It feels like that bank is calling and screaming at you right this second, and it's not. It all feels like it's coming on you. That's why you got to have somebody else that's walking alongside you.

Do you have a church community that you're plugged into?

Yeah. Okay.

I would make sure they're aware of the situation and see if they can rally around you and support you in any way they can. The other thing I'm going to do for you, Kelly, because it's hard to... I wish I could just snap my fingers and fix this on a radio call. But what we'll do is give you a free coaching session with a trained Ramsey financial coach who can dig into the details and help you start to sort this out because there's a thousand pieces. And I know you're scared, and you've got the little kiddos who are looking to you for support to be their strength. And this is going to be a journey. Right now, it's a journey of just surviving the next day. And that is keeping the food on the table, food, utilities, shelter, transportation. That is your A1. The collectors can come all they want, but you don't need to worry about them right now. So hang the line. We'll get you connected with Ramsey Financial Coach. It's on us. We are wishing you the best. This is the Ramsey Show. Buying or selling a home is one of the biggest deals you'll ever make, and that comes with a ton of pressure.

But you can close on your home with confidence and keep on top of your financial goals. You just need a roadmap showing you the right way, which is exactly why I wrote my new book, Real Estate, the Ramsey Way, covers everything I've been teaching people about buying, selling, and investing in real estate for over 30 years.

To get your copy, visit ramsey solutions.

Com/store.

Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. The number to call is 888-825. Michael is up next in Raleigh, North Carolina. Michael, welcome to the show.

Thank you, John. How are you guys doing today?

Doing great. How can we help?

Hey, I'm in a position where I am leaving Raleigh and going to a new state. We have about $100,000 in equity in the house. We owe 200 on the house. It's worth 300. We don't have anything else besides a couple of hundred dollars worth of bills. When we move to this new place, real estate is much more inexpensive. We're in a position where we can probably buy it cash, but then we would wipe out our rainy day fund. What should I do?

Well, don't love that idea. So I think- Not that? The lowest I would go is a three-month emergency fund factoring in the fact that you won't have a mortgage payment. I would only drain it down to that level. That's where I would be comfortable going to. So the question is, how can we fill in the gap to go? How do we have enough cash to where we're not going to do that? And that might mean you go to the new place and rent for a little while. It might mean we don't make the move as quickly. So what is the timeline and urgency around this It was three to six months, and I found out today it's going to be about a month and a half.

Yeah, it's one of those work situations. You either move or don't have a job.

What state is this?

Illinois.

Okay.

I would recommend- Have you ever lived in Illinois? What's that? Have you ever lived in Illinois?

No.

Okay. So I'll just tell you, me, Ken Coleman, Jade, maybe George. When we moved from wherever we lived to Nashville, we all rented for a while to get the lay of the land, figure out what's the cool part of town, the not cool part of town, the where we want to be part of town. And man, it just helps level everything. And it's a pain in the butt to move twice. I know that. But man, I would hate for you to put all your money into a place and realize, I do not want to live in this part of town, and it's too late. Then, by the way, you put all your money into it, and the air conditioners are going to go out, and you're going to need a new roof, even though you got an inspection on it.

Then you go into debt because you didn't have the emergency fund and then call us.

I would rent the cheapest place I could rent that felt safe and then get a lay of the land, man.

Thank you for the perspective.

You've got to move in six weeks here. Are you trying to sell this house within that time frame?

Yes. I mean, it's as simple as I'm having an appointment with open door tomorrow. Oh, really? No, no.

Dude, they're going to take you to the cleaners.

Take your time, bro.

Why open door tomorrow?

I wanted to be able to buy a house.

Yeah, you know who they target? Desperate people named Michael.

They do. Yes. Don't do it, man.

They're going to lowball you so hard. You're going to get screwed on this deal.

Yeah, don't. Just don't. Take your time, brother.

Here's what I would do. I would get in touch with a Ramsey trusted real estate agent at ramsey solutions. Com and list it with peace. That might mean we just go rent for a while while this home gets sold. Maybe it sells within the next month. Who knows? I mean, how quickly can you get it staged and listed? Probably within a few weeks.

Yeah, easy.

Maybe you can close a few weeks after that. I mean, that's not unheard of if it's listed and staged properly, but I would not go desperately sell it to one of these companies.

The last I looked, Raleigh was one of those cities that was almost as bonkers as Nashville is, and it's starting to heat up in a way that's annoying because I'm trying to buy a place.

People are Jonesing for homes at 300,000 or less. It's hard to find these things.

Please call a real estate agent and do it right. It's going to cost you 50 or $60,000.

Cancel the appointment with open door today.

Tell them you called two strangers on YouTube and it changed your mind. But, hey, go slow. It feels like your whole world just got accelerated and everything's going too fast. The greatest thing you can do when the train feels like it's going too fast, just get off. Just stop. Just get off the train. You're in control. You got to move. Cool. I'm going to rent a place. It's going to be annoying, but it's what we're going to do. We're going to find the right thing for us. We're going to project out 18 months. Where do we want to be? How do we want to feel? What do we want life to feel like in 18 months? We're going to reverse engineer that back to today.

Do you have a family, Michael?

Yes. We left him behind a couple of moves back out of California.

Okay. Who's making this move? Is it you and a spouse, you and spouse and kids?

Well, you're not going to like it. It was just me and the girlfriend that's been together 10 years. We 50/50 on everything, and pretty soon it'll just be one. Okay.

Well, cool. Dude, you can sell a house and get married this weekend. That's going to be amazing.

Yeah, it is.

He's excited about that plan.

I'll ask her. I'm asking her in April.

That's fine. Well, if you want to come do it on the debt-free stage, we'll do it. George will...

He'll officiate the wedding for free. I'll get one of those online licenses in five minutes. We'll make it happen.

It'll be fantastic. Yeah, Michael, go slow, rent. Okay? Go slow and rent, brother.

All right. Thank you for the call. Wishing you the best with this move. That's exciting, but also a little scary. Steve's up next in Seattle, Washington. What's going on, Steve?

Hey, guys. My name's Steve. I was just calling. I have some questions. I'm newer to Ramsey. I mean, I've been listening for the last couple of years, but I'm in a bit of a situation. I'm hoping you can help me with some guidance. I've got some debt, about $40,000 in consumer debt. Thirty of that is credit cards, and then $10,000 is the remaining balance on my car loan. I am going to be getting a rather sizable bonus from work. Coming up the next week, it's going to be about $40,000 before taxes. I'm a I'm a little lost on how to tackle it. I know I've read about the snowball effect and whatnot, but I owe so little on the car, and the payment is a little high at $650 a month. I'm wondering if I should knock that off, free up some cash flow to attack the other stuff. I wanted to get some thoughts from you guys.

Is this credit card, is it broken out among multiple credit cards, 30,000?

Yeah, it's three different credit cards.

What are the balances among the three?

One is a 13,000, and it's 12%. Another one is 9,700 at 18%, and then there's a 6,400 at 24%.

Okay. With this 40K, you're going to knock out all the credit cards and most of the car loan Then probably within a month or two, you're going to knock out the rest of the car loan.

Yeah, ideally, but the bonus is before taxes. It's not going to be a full 40 grand in my pocket. It's probably going to be around 23 to 25 in my pocket.

Okay, so they'll take the taxes out. You have the thousand bucks starter emergency fund plus whatever you need to cover your bills?

I don't yet. I don't yet, but I guess that's some good advice that I should take from you guys. A thousand dollar starter fund. Yes. Then you mentioned bills and whatnot. Can you explain a little bit more on that?

Yeah. So what are your household expenses just to keep everything going? The food, utility, shelter, transportation, insurance bills, all of that. What does that add up to in one month?

Got you. It's about $2,500.

And what is your take home pay every month?

Take home pay every month is about 3700.

Okay, so you should have about twelve hundred bucks in margin to throw the debt every month Yeah. Correct? And then once you knock out all these credit cards, what are those payments add up to every month?

That adds up to about $750.

So you're going to have 2000 bucks to throw at the car loan, whatever's left of it. Yeah. And that's why I'm telling you, you're going to knock it out really quickly. And a huge component of this, Steve, is creating and sticking to a monthly budget. And we're going to help you out with that. We created an amazing app called Every Dollar, and I'm going to gift you the premium version. It connects to your bank account. There's a paycheck planning tool so that you know exactly where the bills are going to fall, and if you're going to run out of money, and we'll help you plan for that. So a lot of great features to help you along this process. But the key here is debt snowball, ignore the interest rate. You're a very smart guy, and I can tell because you know your numbers. But the key with this is behavior. We found that personal finance is 80% behavior. It's only 20% head knowledge. And so the hardest part is actually throwing the entire bonus at all the debt. And the best part is you freed up those payments, and now you can apply it to the next largest debt and the next largest debt.

Okay.

That helps a lot.

Yeah, absolutely.

Hey, let me ask you a quick question, Steve. Why do you think you're going to pay about 50% tax on this bonus?

It's I think it's more 40% just because I'm a W2 employee, so I imagine that's how much is going to come out anyway.

That may be a bit high. I guess we can wait and see.

We will wait and see. But whatever's left, you're going to be able to knock out real quick. I mean, what a blessing to get this bonus.

Yeah, just use it wisely.

This is the Ramsey Show. Folks, changing your family tree takes more than rice and beans and side hustles.

It's also about transferring the big financial risks off your family by having the right kinds of coverage in place.

That's why my team created the Coverage Checkup Quiz. It only takes about five minutes to find out what types of insurance you need and don't need to protect your finances.

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That's ramsey solutions. Com/checkup.

Well, Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney this hour. The number to call is 888-825-5225. Joshua is up next in Salt Lake City. What's happening, Joshua?

Hi, George. Hi, John. Just calling in. I'm 35, and I'm feeling like I failed as a father, and just trying to make sure that I'm… Mostly because I'm trying to say for a home and this house market environment is pretty rough, so I just want to make sure I'm on the right track.

What happened, man? That's a pretty-I'm fighting words right there. Which is a tough judgment you've cast on yourself. Where's that come from?

Well, I didn't grow I grew up with a broke family, and so we had a lot of broke mentality. It wasn't recently until I found this show a few months back where I was like, Oh, my gosh, I'm old, and now I got to start from scratch. I'm debt free, so thank goodness for that.

That makes John elderly then if 35 is old. Goodness, he's geriatric.

But you said you failed your family, man. Why do you think that? Why would you even say those words out loud?

I don't know. I just want to make sure that they're safe and they're set up financially. I feel like I'm not going to be able to help them in the future because I'm starting at an older age.

All right, let me tell you, you may have heard me. If you're new to the show, you may not have heard this story. My mom was not allowed to go to college for cultural reasons, for religious reasons. At the age of 42, my dad was always encouraging her. He was just a policeman, and he was always encouraging her and encouraging her and encouraging her. At the age of 42, she took her first community college class, and then the next year, she took another class. Next year, she took another class, and she graduated her PhD at 57. She got tenured as a professor at 63, I think, or 64. Then this past year, retired in her 70s after her last semester at Oxford, teaching in Oxford. Why do I tell you that? The job part, cool. The extra income for my family growing up, cool. That's all fine. But me, in my mid-forties now, you know what I got? I got a ringside seat to watching a gangster of a mom change everything in her early forties. I got to watch her grind and get after it. I remember her putting the laundry detergent on the washing machine and saying, You're in seventh grade now, brother, or sixth grade, you're doing your own laundry because I don't have time.

I was like, Oh, this is so unfair. Yeah, right. It was amazing. She put that on me at that age, so I had to learn how it all works. You are casting a judgment on yourself based on a number. I hate that about our culture that we answer the question, What are you worth with a number? It should never be cast. That's a terrible metric for the question, What are you worth? But what you're giving your family right now is a dad at 35, the light came on. You now have a new path that's going to be different than the one you grew up with, and they're going to watch their old man scratch and claw, and you are going to take them to a new level, both financially, because you're going to do that. You already don't owe any money, man. So you're on a path. But more than that, they're going to be able to go to college. They're going to go out of school. They're going to go work because they have a picture of what that looks like. And that was dad when he said, No more. I'm changing everything. You are changing your family legacy over and beyond a dollar amount.

Do you hear what I'm saying?

Yeah. Does your family have it better now than you had it growing up?

I guess I could say, yeah.

Yes, they do.

I don't know in what category that could be considered a failure. Unless someone else used those words against you, I think we need to drop that and go, What is next for me?

Do you think you're a failure just because you don't have a house, you have not purchased a home, you all renting?

Yeah.

Are you not where you want to be with your career? Are there other factors at play here? Or is this really just about homeownership, and you saw that as a status symbol to own a home at a young age.

It's mostly just home status symbol. There's a lot of voices that happen.

Yeah. Get off Instagram, brother. You're doing real good, man. What do you do for a living?

I'm in software engineering.

What do you make?

90k.

How many kids you got?

Three.

Okay.

Is your wife working outside the home?

No, we're home-schooling.

Okay, cool. What is your next financial goal? Do you guys have the emergency fund fully funded?

Emergency fund is fully funded. Next goal is to just put at least 20% of our take home into a savings so we can just save up for a 20% down payment.

I love it. You guys are both on board with the timeline for that?

More so than me. I'm more on the mind of, I would like this in a couple of years, but it's going to take at least five.

Five years to save up a down payment to do this the right way with peace.

Yeah. I think you can do it faster than that.

That's considering you're not going to make any more money over the next five years, which I think in software engineering would be an insane assumption.

Yeah, I just got a raise, and so I'm hoping that it will go up further down the future.

Or as a software engineer, can you not stuff on Saturdays and Sundays that's going to take time from your family, it's true. But if it gives you three years of your life back and gets you in the home that you want, it's going to give you some peace, that's worth every penny of it.

It's a good point. I could look up some time.

You also live in a very high cost of living area, right? Yeah. Do you guys have roots there, or are you open to moving so you can have this homeownership dream sooner?

That's still in discussions with what me and my wife are wanting to figure out. Okay.

Am I crazy? Is there something else besides just owning a home? I hear in your voice a defeated guy.

I don't know. That's a good question.

I'm confused because you're debt-free with an emergency fund. You have a down payment goal. You have this amazing family. You live in a great area, and it feels like you're like, I haven't made it.

Well, we're living in a pretty tiny spot. We're in a condo, and we're squished enough as it is. I've been frustrated for a while in terms of where we're living. I just want something better for the kids. I want a house where they can roam around in the backyard and play.

Can you go rent a place?

Every time I look for a place, it's a little pricey for the renting. I wouldn't be able to do more I wouldn't make the 25% in terms of how much I should be spending on my home.

Maybe you move. Software engineering, there's a lot of remote positions. Maybe you move. Are you working where you have to commute in every day?

I work from home, so I could- She homeschools you work from home.

It sounds like a pretty flexible scenario.

Let me say this, dude. You are Project X. George and I are hearing this all over the country, of people who have good jobs, Are living the life they want to live, except that the town they live in, the city they live in, has suddenly gotten so expensive they can't live there? Like millions and millions and millions of people before all of us, we have to make a decision. Are we going to stay here and contract our dreams to, We're just going to live in a condo, or are we going to change zip codes? We don't want to, but this is reality so that we can have the life that we want. I think that's where you are. Because it sounds like you're living in Salt Lake City for some... It's just this, I don't want to say fantasy, but it's like, We live in the city. It's like, Yeah, but that city is costing you your soul, man. I can hear it on the phone. Just doesn't sound like it's worth it.

Are the kids actively talking to you saying, Dad, we're miserable. We want a yard?

No. No. They're actually pretty happy.

They just want dad. They just want to hang out, and they'll play with a cardboard box. I think this has more to do with you than anything else in the picture.

Do me a favor, brother. Hang on the line. I'm going to give you three free months with my friends at Better Help, I want you to talk to somebody because I'm convinced there's something beneath all of this that is you're just not happy. I want you to be alive in this amazing life you got, and it all feels heavy and dark. I want you to talk to somebody. So hang on the line. I'm going to hook you up.

Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. Our scripture of the day comes from Joshua 1:9. Have I not commanded you? Be strong and courageous. Do not be afraid. Do not be discouraged, for the Lord your God will be with you wherever you go. Walt Disney once said, The way to get started is to quit talking and begin doing. Sick burn.

Hey, before we I want to go to a call, I think it's important to just let America know we were just talking about off-air, you and me. Why don't you reask the question you just asked?

About the Alamo? Yeah. John's from Texas, and I wanted his take on what happened at the Alamo.

I think your question was, who won the Alamo?

Us or them? I went and did the big tour when I was over there.

Really cool tour. America, if you're wondering, are our schools failing us?

We're not doing well.

It's tough out there.

I've been studying a lot personal finance lately. I'm not up to date on what happened in history, so I'm still learning.

But the Alamo?

Honestly, I just knew it'd push your little buttons down.

That's where P. H. Herman's bike is in the basement. All right, let's go out to San Antonio. Speaking of the Alamo, let's go out to San Antonio. San Antonio, up next.

What's up, Joshua.

Hey, thanks for taking my call.

Hey, Josh. I don't know if you just heard, but Jorge asked, who won the Alamo? Right? I know. Don't answer it for him. We're going to make Wikipedia it, or however millennials get their info these days. All right. So what's up, brother? There you go. Sounds good.

Yeah. So I'm in a little bit of a situation to make. So I just finished paying off my car, and I love the car. It's amazing. It's new, and it's my dream car.

What is it?

It's a Camaro. It's a 2021 Camaro.

How old are you?

I'm 25.

Okay. Cool. Paid off the Camaro. Love it.

Yes. So the only issue is that it's very expensive when it comes to gas, and I'm about to move into a house that's even farther from my house. Sorry. That's even farther from my work and school. So the gas payments are going to go even higher. I'm thinking of trading the car in and getting a Tesla because the house I'm going to has a electrical vehicle recharger. And apparently, I did a little bit of the math, over three or four years, it should pay itself off. Bro.

You've got Camaro's remorse. It's a common illness. Is it? Yeah, it's a very common illness.

So what was your plan? You want to sell the Camaro and buy a Tesla in cash?

Yes, but I probably still have to pay off about $10,000, maybe $11,000.

Of what? What's the other debt?

Just the rest of the Tesla. It won't fully...

The trading value won't be paid. Oh, you're saying you can't afford the Tesla?

Not straight up.

Hold on, Joshua. But, George, in four years, it's calculated gas. It's an investment. It's actually an investment.

Also, Joshua, as someone who owns a Tesla, can I tell you, electricity is not totally free?

Fair enough. I heard it over a year, you'll pay a third of what the gas would be.

I mean, you've probably heard a lot of things. I'm telling you- You did buy a Camaro. That it is cheaper. I don't have the cost of gasoline, and I love that. It's really fun. Dave pays for my electric vehicle charging here at Ramsey. Rock on. But the thing is, going into debt for a depreciating asset in order to save a few bucks a month is not a wise move. It's the same reason people go, I'm going to go get a solar panel loan for $38,000 because the salesman said it'll ROI in three years, and it doesn't. And so if you can't buy the Tesla in cash, don't buy a Tesla. So what is the Camaro worth?

I would say the average of the offers I got would be around $28,000, $27,000.

Where are these offers from?

Oh, Kelly Blue Book. And then as soon as I put it in, I got all these calls from various dealerships giving their offers to me.

Yeah, they're low-balling you because they're going to flip that and make a profit. I would look to sell at Private Party and see how much you can make there. I'm telling you, you can find a Tesla for under $28,000.

You can also find a $10,000 Prius and ball out. You want to do that?

That's what's up.

I'm not sure about the Prius.

See, I knew it. It says nothing new with gas mileage. You just don't like the Camaro. Just say that out loud.

You have, Joshua, tell me if I'm wrong, you have an obsession with brand new cars. It scares you to buy a used car. I'm not going to lie.

Yeah, I would be lying if... I mean, I know it's not the smartest financial decision, but at the same time, I'm getting a nice car and- Why is a used car not a nice car?

Who lied to you and told you that? I drive a 10-year-old Tesla that I bought like two years ago. It is the nicest car I've ever owned. The problem is once you only drive a new cars, all the other cars are like, This has some wear and tear to it. And guess what? That new car, that Tesla, it's going to become a used car when you drive it off the lot. And another thing, only once you have a million-dollar networth, should you be buying a new car? Because that depreciation is crushing your wealth. What's your net worth?

I'm not really sure how to answer that.

Are you a millionaire?

I am not a millionaire. How much do you make? What's your annual salary?

About 70,000 I'll make this year.

Okay. If I'm in your shoes and you really want to save on gas, then you'll sell that car and you'll buy the most affordable car you can get that is electric or hybrid or whatever. I'm telling you this as someone who did not pay $28,000 for their Tesla. They exist out there, Joshua. In fact, Teslas have taken a huge hit on depreciation. You can find some killer deals right now on a used Tesla.

Okay.

And so that's what I would be doing. Go find you a used Tesla that you can pay cash for once you sell the Camaro. But do not go take another car loan. You work too hard to get rid of this debt to just go right back into it. Yeah. Do you have any other debt? That's a very good point.

No, but I sign off on a mortgage at the end of the month. That'll be my debt. Oh, boy. I have zero debt other than that. How much debt is that? It'll be about $260,000.

I'm guessing this is on a 30-year with very little down?

It's the FHA, yes.

Oh, my gosh. Is it too late to get out of this? Can you back out of this deal, morally, ethically, legally?

I think I could. I thought I would lose the earnage pay.

How much money do you have in the bank? Do you have emergency fund?

After the down payment and the... Well, after all the costs closing, I probably have around $8,000.

Okay. I'm guessing you put little to nothing down on this.

Yeah, I did not put much. About $10,000. Oh, boy.

Okay. Well, that'll be a call for another day, Joshua. But for now, I'm not making any moves. This is a lot of money that you've been playing around with, and I need get a financial foundation under your feet before you start making big boy moves. At 25, in the way you've been living, it scares me a little bit because I can see you going right back into debt as soon as something shiny shows up in your face. Are you going to be living alone?

I won't be living alone. I'll be running out to a girlfriend.

Oh, boy. I've found that's the most romantic thing you can do.

Bro, You are amazing. You know why? A, because I like you. I want to hang out with you. I think you and I would go get chips and K, so we'd have a good time. And you literally are making every... Our entire show is about not doing the things that you're doing because you have the opportunity to do something nobody in your family has ever done, and that is to become a millionaire, to be so wealthy that you can take care of everyone around you in your neighborhood, except you're going to blow it on renting to your girlfriend and buying a house at 2.6% down and buying a new car and then selling it and then buying another new car and then selling it, and all the while just taking that money and burning it in the yard with depreciation. Like, Bro, hang on the line. I'm going to send you Financial Peace University as my gift. I'm going to pay for it, and I want you to watch every video and break the curse, man. It's not too late.

Oh, man. Can you imagine your boyfriend turning into your landlord? That's an awkward situation.

Hey, it keeps my show busy, that's for sure.

That puts this hour of the Ramsey Show in the Books. My thanks to Dr. John Deloney, all of the guys and gals in the booth who kept the show afloat today. You, America, will be back before you know it. Hey, folks. Dave here. You want to hear even more life-changing content from Ramsey? 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 Dr. John Deloney Show. You'll get real talk about life, relationships, money, and your career.

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