Live from the headquarters of Ramsey Solutions, it's the Ramsey show, where we help people build wealth, do work that they love, and create actual amazing relationships. Number one best selling author and a host of an ever popular YouTube podcast, George Campbell. Ramsey personality is my co host today. Thank you for joining us, America. We appreciate you hanging out open phones at. Let's just start off with Dave not pushing the right buttons. Anna is in Detroit. Hey, Anna. Welcome to the Ramsay show.

Hi, how are you? Thanks for having me.

Sure. What's up?

Well, a little bit of a situation, and I'm hoping maybe you can give me some advice. My husband bought our house from his mom 19 years ago. She had quite a few houses at the time and decided that she could sell one of them to him. He was 19 at the time, went through a closing with a proper close agent, and signed all the papers. He is the only name on the warranty deed and has been responsible in living in this house for this past 19 years. A couple of years ago, she had asked us for quite a sum of money, and we said we couldn't afford it. So in retaliation, she went to the county clerk and filed a fraudulent quick claim deed on the house, claiming that our house is now her house. There's no checks and balances with that system.

Yes, there is.

It went through and evidence.

Yeah, the checks and balances are. You put her in jail for fraud? Yeah, because she's a freaking crook. She's a criminal.

It's been two years, and we're still fighting. And now instead of getting our day in court, they're saying that it's going to either cost us $20,000 to take it to court, or we can pay the ransom and maybe settle for something less and just pay to get rid of it. To pay to get out of it.

You mean pay her?

Yeah. A settlement. Right.

So why have you not filed criminal charges?

Well, I talked to the county clerk, and she said, oh, you need to get an attorney to the quiet title. So that's what we did.

And your attorney needed to tell you to advise you to fire criminal charges. Someone stole your house. It just happens to be that, you know, the crook, right.

That it's related. But he said, well, that would be a separate lawsuit, and that wouldn't get you the quiet title that you need to free up your house. That would be a whole separate matter.

I disagree.

To get your quiet title. But then maybe on another point, and I'm like, man, we've already spent so much money trying to get the quiet title and now we're really looking at maybe just calling the police and starting a report.

Yeah, I think I would.

Okay.

I think I would file criminal charges on her.

And that's the thing. We thought maybe it was just a.

Misstep because obviously this is not someone that your husband has a relationship with his mother. No mother in her right mind would act like this. This woman is deranged.

How long has he known she's crazy?

A couple of years. Well, now it's been two years.

He didn't know she was crazy before this?

No, he was young and a single parent. Right.

How long have you been married?

About 1617 years.

Yeah. How long have you known she was crazy? Because I figured it out in about 30 seconds.

There was a lot of kind of red flags when we were first dating. But I started dating him when we were 16 years old and so we were so young. I think we were very. I don't know, it was just, well.

You don't want your mom to be a crook or crazy. Nobody wants that mom.

Exactly.

But some people's moms are because obviously there's crooks and crazy women and men out there. So sometimes the dad is a moron. I mean, it just is very strong.

Christian raising to honor your mother and your father. And I think there was a lot of things that we just said, no, she just needs help. Know if we can just pull her through. Know if we can just be there and help her get up on her feet. We did that for a lot of years. And then finally I said, you know what? I told my husband either our household or hers, but you can't be the man of both. And he chose our household.

Good choice.

That's when the crazy came out.

Yeah. When you set boundaries with crazy people, it accentuates they're crazy. Henry cloud teaches us that in boundaries 25 years ago. Okay, so you've got some choices. Obviously, there's no relationship left and it's a very sad situation. So what is the most practical process here? It doesn't cost much to file a criminal complaint.

Okay.

There's not a lot of cost involved in that. That's why I'm shocked that this attorney, in quotes, didn't recommend that you do that as a part of the quiet title. Because here's the problem. If your attorney that was quieting the title, quieted the title and then said, deranged mother in law decides to file another one, you get to do it over again and he stays in business the rest of his life. So I want her having an incentive to stop this crap. And that's called jail. Well, yeah, she's not going to jail, by the way. Darn it. No, she should.

I don't.

But they won't put her in jail. They'll settle with her, but she will get the message not to screw with you all.

Yeah.

Who said it would cost 20 grand.

Not to file a criminal? It doesn't.

No.

He said they told.

Yes, our attorney, we've already paid him 40 over the past two years to get a quiet title, and now we're to the last bit of it. And he said, you either settle or take this to court or fire him.

And get a real attorney.

I've called different attorneys, but they said I'm too far. No, you're not into the matter.

No, you're not.

To get another one.

No, you're not.

I've gotten all these stories, and I guess I just need some real good counsel.

The problem is sometimes when you're dealing with lawyers, they took the class on. They're always right, and they forget that they work for you.

Right.

He's your employee. He should do what you tell him to do, or she should do what you tell him to do. And that's what lawyers are supposed to do. But instead, they took the class where they tell you what to do. And some of them are really confused by that class. So sometimes us real people have to explain to them, lawyer does not mean you do what you want to do. It means you do what I want you to do as long as it's within ethics and within the law. And so, yes, this has not been aggressively enough to suit me in the discussion I'm having with you. If this happened to me, and I own a bunch of real estate, I don't care who filed that. I would have filed criminal the next day.

Okay. And I thought maybe I needed to get basically a judge to say, yeah, this is fraud, before I could go to the criminal and make that.

The judge says it's fraud. It should quiet the title instantaneously.

Right.

Because that invalidates the. Take a judge ruling of fraud over to the county clerk and go, judge says, this is fraud. You need to take this quick claim down. They'll take it down. That's the quieting of the title. That's what it means. It's the cleaning up of a dirty title because it's a fraudulent thing. God, man. Some people who does this to their own kid? You whacked, chick. Unbelievable. Go to jail. Do not pass go. Do not collect $200. Go straight to jail. Monopoly.

She's collected enough.

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George Kemp Ramsay personality is my co host. George, you know that we're going to be in business forever.

Why is that?

Because God keeps making people.

Are you insinuating that people are not the smartest all the time?

Some of us aren't. Some of us in this species have to start over every so often. I do a lot of stupid stuff, but my personal rule is not to do the same stupid stuff over and over.

You've evolved.

Well, it's a higher level of stupid.

There we go.

Because the past level of stupid has been grown upon.

It's always right below the surface. You got to watch t h d.

In D u m b. I have graduated. Wow. There you go.

Deloney has two of those.

Well, he's not in that. He's got real ones, but there you go.

The good kind.

Today's question comes from Jason in Connecticut, who's also not evolved. Can we start treating bitcoin the same way you would treat single stocks? Crud. Son, I understand you're not a fan. No kidding. Where'd you figure that out? But an asset with $1 trillion market cap is not a beanie baby. No, but it's still thin air. Ask people like Warren Buffett, who says if he doubled the amount he had put in bitcoin, he would still have zero, because that's the amount he's put in bitcoin. I'm going with Warren on this one. Not saying you have to add it to your portfolio, but it's a good enough asset to invest 5%. No, it's not. Okay. I don't know where the 5% comes from. I don't know where the trillion dollar market cap comes from. Mist and smoke and mirrors. Like the whole here's what happened concept.

While you were enjoying some time off. Bitcoin has shot from the ground to the moon and probably back up again. And so now everyone's really. They're getting loud again.

No way.

Because it's hit all time highs. And so now everyone's going, see, Dave is wrong about this.

You know what? We've got something else that repeats itself, like gold. See, I've been doing this show for 32 years, and ever so often, gold goes up and everybody goes, see, Dave, I told you. And then it goes down and those people just disappear. And then it goes up and they go, see, Dave, I told you. You don't understand gold. You don't really understand. Gold has value. Like what? Why does it have value? Because people like you, it's a commodity. That's where people give value. The only reason gold has value is two people agreed it had value and they fought over it. That's the only reason. That's the same reason that green paper has value. Two people agreed to add value and they fought over it. That's what gives something value. So commodities are exactly the same way as currencies and bitcoin. Someday, all kidding aside, all sarcasm aside, someday it may level out and become a thing. But Jason, it's not there. It's not there. I wouldn't wish a bitcoin investment on somebody I really dislike.

That's saying something.

I really wouldn't. I mean, I don't even want those people to lose money.

Well, even then, I see single stocks very differently, because stocks are based on a company's performance and revenue being created.

Well, that's because you're intelligent.

I didn't have to think that deeply to get there. And so, again, I'm not mad at bitcoin, but to say bitcoin is the same as a single stock is just not true.

No, bitcoin is a currency.

It's speculation based.

Currencies have no value except for their track record. That indicates that two people are willing to fight over them. That's why the yen versus the dollar, the pound versus the dollar, the Deutsche mark versus the yen, these things compared back and forth. It's the faith that people have in something. And of all the currencies, bitcoin has the least faith. It's the most.

I've heard a lyric once, you got to have faith, Dave.

I wasn't going to go, oh, yeah, there's. Yeah. So it's going to continue to be volatile until it's not. And even then, I don't invest in the Iraqi Dainar because it had Saddam Hussein's face on it. And no one has faith in that currency anymore. I don't invest in Confederate dollars from the civil war because no one any longer has faith that they have value except as a collectible. I do not invest in things where people have not established a long track record of faith. And even then, on a currency. I don't invest in a currency. Utilize it. I would utilize it. So to the point that I don't trust PayPal to be an exchange. That's a trust mechanism. I don't use PayPal for an exchange, so I don't even use bitcoin for an exchange because it's too freaking out there for that even. But it's a currency, honey. It's not an investment, to George's point.

Well, Dave, you just don't understand the blockchain technology. And once you get it, you'll change your mind. That's the line I hear all the time. Yeah, this guy doesn't understand the blockchain. It's the future. Maybe it is.

When you say stuff like that, it indicates you don't understand investments. So we're going to help. Today we've launched a two night virtual event, online event, of me teaching my personal playbook on investments. It will not include bitcoin, include bitcoin, except to trash it thoroughly further. So if you want more, that's worth.

Buying a ticket just for that.

If you want more entertainment, come join us. George is going to help me with this event. It is Dave Ramsey's investing essentials. A lot of the TikTok Goobers have been asking about my actual real estate portfolio, my personal, actual formulas that I use. We're going to go into those, the real estate stuff. I'm going to show you what I do. I'm going to show you what I invest in. I'm going to show you what people that I walk around with that are personal friends. Invest in that have 1020, 3200 million dollar portfolios. Millionaires. Not your broke brother in law living in his mother's basement with an opinion because he is on TikTok. Don't listen to people like that. You're going to be as broke as they are and look as dumb as they do. Don't do that, guys. I don't know a lot. I can't fix your car. I used to turn a wrench because I'm an old redneck. But now when I open the car, it looks like a spaceship to me. So I can't help you with that. But this I do every day, personally for me. And I have walked with people who really do it and who really have substantial assets.

And so there are some basic principles and processes. Investing essentials, we could call them, to picking an investment, sticking with it, when to abandon, how to analyze that real investors not get rich quick morons use. And so we're going to go into that, all that. It's May 21 22nd. Tickets go on sale today. It's at our website, ramsaysolutions.com events. I'll just turn this into a big old ad right now.

And it's completely virtual, which is cool because you can join from wherever you are.

We will not accept payment for this by bitcoin.

That would be hilarious, though.

We will not, Dave, we will not accept payment for this on a credit card because we don't take credit cards. We don't believe in those either because we actually do the stuff that we teach around here. We're like not hypocrites and stuff. So I actually live this way. I have four pieces of plastic in my pocket, a debit card on my business, a debit card on my personal account, my driver's license, and my handgun carry permit. That's all that's in my wallet. I don't have anything else. And all the rednecks just said, amen. But that's all you need.

So we're going to cover the basics. We're also going to get into the specifics that Dave mentioned, from mutual funds to real estate, how to maximize your 401K.

That's the start.

Dave's personal strategy and then investing trends. What's going on out there? Which ones should you avoid? Which ones are actually good? And get your tickets, because it's virtual. So this event can't technically sell out, but there will be a limit.

You can decide that old people are out of touch or they have more experience than you. Which is it? Because I've seen four cycles in my adult life of the nothing down real estate come and go. Four cycles of it. We're in the fourth right now on TikTok and a little bit on Instagram, but I've seen four of them. Some of you aren't old enough to have seen one of them, and so you're going to fall headlong into it like I did the first time and bloody your freaking nose. So you can decide, do old people have wisdom from their experience or are they out of touch and they don't understand blockchain technology. You don't understand because you didn't grow up with an iPhone in your hand. You didn't use it as a pacifier, so you don't know how the world works. See, you can decide that if you want or you can decide to actually freaking learn something. I don't care which. I'll be okay either way. But we'd love to have you come to this because we're going to have a lot of fun. Can you tell I'm a little jacked up about this?

Yeah, I'm getting excited just dreaming about what this content will be. Join us.

Good stuff. Ramsaysolutions.com events oh, it's $199 for two nights. We're going to do about 2 hours each night. So do it. Figure it out. Like $50 an hour is what you're going to have in this.

Your spouse can join.

Yeah, get the neighbors over. We'll all watch it on the pay per view. You can watch it on your blockchain. I mean on your Apple TV, whatever it is. You can do that. I'm kidding. I actually do know how to do that. I watched a movie on Apple TV last night. Look at you. Off of my eye.

Old dog can learn new tricks.

Did do the mirroring, the whole bit, so shut up.

Guys, airplane over here. He's out of touch.

Friend of mine that just funded a movie sent me the whole movie. It's not out yet. Asked me to watch it was fabulous. This is the Ramsey show.

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George Camel Ramsay, personality, bestselling author, is my co host. Open phones this hour in the lobby of Ramsey solutions. In addition to a couple hundred of our best friends drinking our free coffee, eating our free cookies on the debt free stage, Eric and amanda are with us. Hey, guys. How are you doing? All right.

How are you?

Oh, you'll be okay. We've never lost a patient.

Okay.

You'll be either.

That's good news.

It's good news. Yeah. So where are you guys from?

Right now we're living in Memphis, Tennessee.

Okay. What's right now? Where are you going?

Military. So we've moved around quite a bit.

We've been all over.

Thanks for your service. Which branch? Navy. Navy? Yeah, I figured it. Memphis. Okay, cool. Good to have you guys. So how much debt have you paid off?

$73,000.

Wow. How long did this take?

About three years and four months.

All right, and your range of income during that time?

99,000. All the way up to $110,000.

Excellent. And, Amanda, what do you do for a living?

I'm an operating room nurse.

Oh, so you haven't lost a patient either. That's what you're saying. Good. We have this in common then. Yeah, very good. Although yours were more at risk than mine, but, yeah. What do you do in the military, Eric?

I work as a data scientist for Navy recruiting.

Oh, very neat. Yeah. So an after military career, that looks very lucrative to me. Well done. Good for you guys. Good job. So what kind of debt was this? 73,000.

Oh, we had mostly by student loans. Eric's student loans, his little miata. We had to pay off his little Miata. Yeah, he really wanted to. So we did pay it off. I had to ask him if he was sure he wanted to do that, but we did, so we're still driving it. And then we had some medical debt as well.

Very cool. Very cool. So how long you two been married?

We had our wedding in 2021, but we got married in 2020.

Pandemic.

Okay. All right, so you've been married four years and three years and some change. You've been working on this. So how'd you get connected and do decide to do this ramsay journey stuff?

I was the Ramsay person before I met Eric. So I actually met him when I was a traveling nurse, and it put me in Charleston, where he was at the time. So we met out there, and I was already doing this Ramsey stuff. And then we were dating for a while, and the pandemic hit, and we were talking about possibly getting married and we had to have some serious conversations about what I was wanting to do financially and what our goals were together. We had to come up with the plan together, and I kind of got them bought in on the Ramsey stuff.

So, Eric, she wanted to have the define the relationship ETR discussion here.

I want to become debt free, so.

If you want to be with me.

I was grinding. It's always like, this has got to be a part of your life.

I'm travel nursing. The pandemic. So this is.

It was. It was serious.

It was good money, but it was real scary. There's a lot of crap.

I was terrified.

I guarantee you. So, Eric, she comes in and says, I kind of like you, but we got to get aligned. What'd you say?

At first, I thought I knew everything about money. Turns out I was not financially literate, and the concept of positive net worth really made me angry for some reason. Because I didn't have positive net worth at the time. You were a financial genius who was broke. Exactly. We know a lot of those.

I let him know gently, though. It was nice. That's good.

You do seem sweet. Nice. I mean, better than delivering him up to us.

You're passive aggressive. It's a little Miata.

It's a little Miata.

That's fun. So you guys get married, and it was just like combined incomes. Let's go. Did it give you hope when you saw the numbers as you laid out your first budget? It did, yeah.

Life was really confusing because he was getting moved again in the military, and I was like, I'm not going unless we're on the same page. And so it was really muddled for a while for us during the pandemic. I was terrified. In surgery, the nurses were not getting as many hours, so I was working as much as I could because I was afraid I was going to get fired. So everything was just really terrifying for us. And so once we decided to do life together, it really just took off from there, and it was such a relief to get on the same page.

Wait a minute. You were doing travel nursing in the OR?

Yeah. Where the money is at.

Okay. But not during the pandemic. The money was other places. We had some nurses that were making unbelievable money standing on this stage during that time.

But in surgery, it was a little bit different.

Yeah, because a lot of it's elective, and they just say, well, just wait.

Yeah, we can't do this right now. And so we were dropping like flies out there on the or side.

No pun intended. Careful, careful. That could go bad on a sound bite. That could be really bad. Way to go, you guys. All right, so you get together and you say, we define this. We're going to get after it. And you paid off 73,000. What do you tell people? The secret to getting out of debt is in three years?

I think. Stop taking advice from broke people. And you definitely have to be on the same page.

It just makes.

Not just with money, but with life. It just makes things so much easier.

Finances are like a small part of it, but you really have to get on the same page. But it really helps. Like, if the financial part isn't the struggle in your relationship, everything else seems to work out, but, yeah, you got to be on the same page. And then baby steps, too. When people want to ask me about getting out of debt, it's like, just follow the baby steps. They're not that hard.

Yeah, it works and stuff. I'm proud of you all. Well done. Thank you. Who was cheering for you?

Mostly ourselves.

She was. She was the biggest cheerleader.

She was my biggest cheerleader.

And families just kind of looking on, thinking you're weird.

Yeah. A lot of people didn't get it. We had a lot of naysayers, but mostly just people that didn't get it. They were just like, oh, okay. Yeah, if that's what you're going to. You know, I was moving around a lot and people didn't understand that either.

I did have some friends in the Navy, though, that had recently become debt free when we decided to get married. So shout out to Nick and Alicia.

Cordell because they got debt free. And that's what finally bought him into everything, because I had preached a lot and was waiting for him to patiently understand what I was doing. But then I think his friends becoming debt free, really?

Yeah. There's nothing like having somebody walk up in front of you and go, I just did this. And it's not theory.

It flipped a switch for him.

Yeah, it does. It does for me because I'm pretty cynical. I mean, it takes me a minute to come around. I know you can't imagine that, but, yeah, then when you see the actual proof and that makes a difference, and that's the difference in someone tuning into the show today or tuning into the show 30 years ago. It was just me on the air trying to get people to do this stuff and nobody done it. And now we've got thousands of debt free social proof. Yeah. Thousands of debt free screams on YouTube. Yeah. So way to go, y'all. So proud of you. Excellent job. Thank you. Hey, we've got a couple of every dollar gift cards for you that are one year subscriptions. One for you guys to tie into the bank and keep working what you're working so you can hit that. Baby steps, millionaires, next step. And one for you to give away and get somebody else converted and get them going in that direction. So to say thank you. And again, thanks for your service, both of you, for what you do. You both serve society. It's a strong thing, and I'm glad you're prospering as a result.

It's very good. Eric and amanda, memphis, Tennessee. 73,000 paid off in three years and four months, making 99 to 110. Count it down. Let's hear the debt free scream.

Three, two, one more.

Debt free.

Wow.

There we go.

That'll wake you up.

There we go.

That was like 70 milligrams of caffeine straight to the main vein right there. I needed that.

All the old people out there are going, I've been married 25 years. I've been married 35 years. I've been married 45 years. I wish that I was like that young couple had started back then. When we first got married, we had this, and we're debt free 100%. We're not even 30 and we got the rest.

Oh, you're going to be so blows my mind.

Be so rich.

And it started with kind of like you.

You were that way. Oh, yeah. Got started and relate to Eric because.

I had to swallow my own pride and go, oh, maybe I'm not a financial genius because I'm over here looking@my.net worth. Trying to brag about my credit card rewards and how I got a free flight paid for.

But you even had it worse. I mean, you had to come to work here every day. You're like an know. Well, I mean, you're in the midst of people all that actually believe this stuff and actually are doing this stuff. You can't not be confronted accidentally by it. No. And like you said, a hard place to work.

We're not hypocrites around here. And people so badly want to go. I bet those Ramsey people have a credit card. Nope. I mean, you can check my wall at the door. You ain't going to find one. Because I not only believe this stuff, I've lived it. I've seen it. I've had the experience of going, life is better living this way, living without debt, not playing this game set before us by society.

Well, I mean, because the Miata dealership.

That little Miata will get you that's what I've learned.

They'll get you a little Miata.

You're going to start saying, look at George and his little Tesla. It's going to be your new line.

It's paid for. Even if it burns up. It's paid for. That's true. I mean, even if it.

Insurance is for.

Even if the battery quits working and won't be recharged. Paid for. You can just get you another battery, can't you? Yeah.

They're out there.

Okay.

I think Duracell makes them.

I think so. Run down the Walmart on aisle three.

Amazon, two day prime, Dave.

Oh, I forgot.

That's fun.

There we go. This is the Ramsey show.

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George Camel. Ramsay personality is my co host. Thank you for joining us, America. We're glad you're here. Open phones at AAA 825225. All right, Tyler is with us in Dallas, Texas. Hi, Tyler. Welcome to the Ramsey show.

Hey, Dave. Hey, George. Thanks for having me on.

Sure, man. What's up?

Well, I'm looking to get maybe some career advice on whether or not I should change career fields. So I'm a counselor in Dallas. I own a small private practice, and my wife is a teacher here. We're planning on moving to Oklahoma here in the next few months to be closer to my wife's family. I'm trying to decide if I should try to rebuild my practice there or if I should try to aim for a more corporate, steady job with benefits in order to help kind of increase our income and provide some stability as we make the move.

Okay. Well, I mean, it's kind of the question of, do I want to work in a corporate environment, a quote unquote steady job environment, or do I want to own my own business?

Sure.

Because running your own private practice is running your own business, right?

Correct.

Are you solo right now?

I am solo. It's essentially a 1099. I have an LLC that I run through an S corp. So there's some tax advantages with that. But I've really been struggling with the instability of not knowing really how much is going to come in each month. It's an up and down field. And it would essentially take me about a year to rebuild a practice back to what I make right now, which is about $75 to $80,000.

Okay. There's no instability if you're booked up for six months in advance with a waiting list.

Correct.

So you've not built the business to that level of prosperity. It's not the business model that's broken. You don't have a full pipeline, and that's where the instability is coming from.

No, that's a good point.

I'm self employed. I don't know what my income is going to be. It's not a steady paycheck. Thank God.

He likes it this way.

Because it's working out for me. That's the answer. And sometimes when I hear people on straight commission or that own their own business, we do a lot of work with business folks in the entree leadership brand, and they say, well, I can't handle the insecurity of it. No, what you can't handle is not making any money. You need to make some money. You start making a lot of money. You can handle the security. I mean, if you're bringing in, if your volatility was between 300,400 thousand and it was going to land somewhere in there, you could exist just fine. But that's not your reality, right? Correct. So if you are going to restart your counseling business in Oklahoma, you need to address that issue. And you're going to have to spend a larger percentage of your time on building relationships that create referrals called marketing, to get your pipeline brimming full. I have friends that have solo practitioner counselors that you cannot get in to see, and they make ridiculous hourly rates. They're very good at what they do, but they built a practice and a reputation around town, among pastors, among teachers, among policemen, among anybody who makes a referral to a counselor, that they really help people transform their lives.

I'm sure you do, but you're just young enough in the profession that you've not built that stronger reputation to get your pipeline brimming full. If you're going to go this route, that's what you'd have to commit to. But if you don't want to spend any time working on the marketing stuff or that makes you nervous, all you want to do is sit in the chair then you probably do need to work for somebody else. And that's not a bad thing. It's just an observation of who you are and what you want to work on.

I think the part that I'm struggling with is knowing that my wife will take about a $15,000 hit in her salary versus Texas versus Oklahoma. And I'm struggling to know which is the right move of if I can wait six months, because that's about how long it would takes on average to.

Do you have the money to wait six months and eat on her 15% reduction?

It would be a stretch, but we could do it.

Okay, well, that's what it takes to open a business and make the move to be near her family. So see, part of this is it's all romantic. We're going to go for her. We're all going to be moving and be with family and back home and I'm all warm and fuzzy. Oh, wait, there's no food in the cabinet. And so the warm and fuzzy goes away pretty quick then. And you start facing the reality of what this move means. And so the two of you probably need to talk about that. That if we're making this move to be near your family, which would probably be her request, most likely, and it's an okay thing to do. I'm not saying it's morally wrong or something, but you need to also embrace what goes with that, which is I'm going to have to take a job or we're going to have to go live on beans and rice for six months till I get some time booked. Your license is transferable from Texas to Oklahoma, I assume?

Not necessarily. I have to redo the licensing process, which is another complicated piece of it, but it should take about three months.

Okay. The career gig you're looking at, is it in the counseling field for a corporate setting? Yes.

No, it would be an insurance brokerage.

Why?

Not necessarily that I'm interested in the field itself, but it just would provide probably a little more long term stability in terms of not having to being a salaried employee and having four hundred and one K and retirement.

Please don't do that. You will hate yourself in three years. You're taking a job only for the money and the benefits and the quote unquote stability. And I'm trying to remind you that stability is mythology. It only comes from a full pipeline. By the way, if you're an insurance brokerage and you don't do some insurance brokerage, you're going to be gone. They don't keep you. There is no stability and you don't even like it. You were just doing it because it's there for food, right? Yeah.

There's zero excitement in your voice when you mentioned it. That scares me.

I almost went to sleep. Yeah, it was bad. Yeah. Don't do that, man. Because the counseling makes your blood flow, dude.

It does. You're right.

Yeah.

It's been a long time in school to do it.

And you like it. You like guiding people as they transform their lives. And you're probably good at it.

I hope. I'm still relatively new in it, which has been one of the reasons why it's taken me so long to build up the practice.

I would love for you to lend something that adds substantial income, even if it's a full time gig to your household for one year, but not as a long term play. I don't care if it's insurance brokerage or anything else, but go in there with the idea I'm going to work somewhere for one year while I get through the licensing process, get my practice set up part time in the evenings and on Saturdays, and start to fill up my pipeline. And let's take a year and make the move and not put our family on bread. But let's have a plan to where within 24 months you're opening your practice. And it's a little bit more of a solid handoff than this. Zero from the level of practice you've got now to zero, and then you got to rebuild all the way from scratch. And you do know how hard that is because you did it once.

Yeah. And the cool thing is there's a lot of virtual appointments happening now in the counseling world. To where? Who knows? He can move a lot of those people with him to know.

I wonder if those virtual folks that Deloney endorsed betterhelp. I wonder if they do contract on the side, if you could just cut in contact with them and join as one of their. Just join as one of their counselors. I think they probably do. That's probably what their model. Yeah.

Network of counselors that they trust and vet. And so I think it's a great option for them as well to get started.

Probably not some kind of big non compete there for building your own practice on the side, as long as you're not stealing their customers. I would think so. That's the kind of thing I would look for. Check betterhelp and see if they're hiring on a contract basis and if that'll fill in the difference while you get your license moved of course, you probably got to get the license moved if you're going to move physically before you can do that. But anyway, yeah, to the point it's not reciprocal. It takes three months, he said, okay. Anyway, you just got to work through your logistics here. But where you need to end up is doing something you love. Dude, you are put on this planet to help people with your counsel skill. Now fill up your pipeline. And that will do away with your need for benefits and stability, because those are an illusion. Benefits and stability both come when you make money. Lots of it. Fill up your pipeline over full overflow. Raise your rates. Hourly rates that are the highest in the market. Because you're the best in the market. And you can't get in to see old Tyler for six months because old Tyler's the best.

And that's where you need to set yourself up four years from now. This is the Ramsey show. Live from the headquarters of Ramsey Solutions. It's the Ramsey show, where we help people build wealth, do work that they love, and create actual amazing relationships. George Camel Ramsay. Personality number one bestselling author and host of multiple YouTube hit shows, including smart money, Happy Hour on the Ramsay network. He's my co host today. Open phones at triple 8825-5225 Brianna is with us. She's in Las Vegas. Hi, Brianna, how are you?

Hi. I'm actually Brenna from.

It's my fault. They spelled it right and I pronounced it wrong. Can't blame the phone screener. My fault. Brenna. I see it now. I'm sorry. What's up?

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

You too.

So the root of my question is, are we financially ready to buy a car? Because the thought of it is making me super nervous. Here's our numbers. We've got about 50,000 saved in the bank. Separate from that, we have our emergency fund of about $30,000 we took home last year. Between my husband and I, about 115. And we have one car right now. It's a 2020 Honda CRV. It's worth about 20 to 23. I looked it up, like, last month, and it's running fine. We've been a one car family for about eight years, but we've got a little one now. And the juggling of the car and work and all that has been a little bit of a headache. And it would make our lives easier to have that second car.

Buy a freaking car. What are you waiting for?

It feels like you're so nervous to give up that money.

And then you're 100% debt free, right?

We are. Yeah. We have a house. We're on baby step four, five, six.

Good.

So we've got a house.

What are you thinking about on the car? What price?

I'm looking for, like, 25 to 33, because we do want a bigger car because we're thinking about expanding our family. So we want something with maybe some extra seats. But the other factor is my husband works very sporadically. Like, he works for the movie industry, so he'll have a good six month run, and then he'll not work for maybe a month or two. And we do really good at saving money during that time.

But you average 115.

Yes. And we've had years where we go down as low as 100 and up as high as, like, 150 or more. But, like, last year, we were.

How is the car going to cause that to crash?

That's a great question.

It's not because you've never dipped into your emergency fund. When he doesn't work, he does something else, brings in a little bit of money, or you tap into savings just a little bit. I don't know how you survive him when he's not working.

We save money when he is working, so we just budget so that we'll save money.

And that account will have $25,000 left in it if you use 25 of the 50 to buy a car.

Right. It just makes me so nervous.

Well, what were you saving the 50 for? Because I think money should have a goal, and I think the problem is you were just saving to save, and now it feels weird to use that money on a car, and it feels frivolous.

I guess that's true. I'm very frugal.

I can tell.

I feel it. And I've been in your exact shoes where, as we made more, we became debt free. It still hurt to write that check. And the car market is still stupid expensive, but.

Right.

You are the prime demo for it's time to buy the car. You've been a one car family for eight years. This is a very reasonable purchase. It's not a big part of your world, and you're doing it the right way.

You're not borrowing money, you're not justifying, you're not over buying. To where you have $80,000 tied up in cars and you make 110. That's dumb. Don't do that. Everything you brought up, every single number, is aligned with what we teach, and we're pretty stinking conservative. I think the difference is this is yeah. This is popping in an emotional bubble. That's all it is. And you just said it out loud. And that's okay.

You've never written a check this big except for probably a house, right?

Right. Only our down payment.

Yeah.

So it's more emotional than it is tied to reality and facts. That's okay.

The richer you get, the better at this you're going to be because you're going to get used to it. And by the way, you're going to get rich because the stuff you're doing is so wise. Everything you've outlined. How old are you guys?

I'm 33. My husband's 38.

Yeah, you're going to be millionaires by the time you're 40. So you're in really good shape.

You're going to look back one day and go, remember when I was freaking out over that $25,000 car?

Yeah, exactly. So you're great. Listen, Brenna, just breathe. Buy you a car. Breathe and buy a car. You're in great George Camel endorsed.

That's right. I'm really frugal.

And yes, you are. That's true. You are tighter than me.

But I married a very bougie, wonderful woman who. We bought her a new to her car. And it hurt to write that check. It was cash, but it still hurt emotionally.

And your net worth? Over a million.

And again, it was just the aspect of going, this is a lot of money.

Just the fact that you're a tight watch.

Exactly what it was. But she deserved the car.

Yeah. That's all it is. I love it. She did deserve the car.

She deserves more than that.

There's no question. You work like a maniac.

That's true.

Y'all don't know George's work schedule, man. He works, so he's earned it. Way to go, guys.

But I have a hard time spending and it's hard for people to let go of that a little bit.

Dustin's in Los Angeles. Hi, Dustin, what's up?

Hey, guys, thanks for taking my call.

Sure. How can I help?

Well, got a question for you. So a little quick backstory on me. 35 years old, small business owner. Started my business when I was 20 years old. All of my 20s kind of lived on rice and beans because I had no choice. Grew the business. And about 30 years old, the major lifestyle creep really started setting in. Started making some real money and just living way too high on the hog.

Made money and spent even more. Twice as much. I was the guy.

I'm like the poster guy for some of the dumb stuff you hear out there. So, long story short, about a year ago, I kind of found you guys right about the same time I got married. And me and my wife said, we're done with this, we're done with payments. And in the last year, we have paid off at about $350,000.

Look at you. Where to go, dude. How can we help today?

Well, here's the thing. So we have our primary home and we also have a vacation home. Pretty good equity in both, and we think we can afford both. My question is, do you think it would be wise just to sell off the vacation home? Almost.

What do you owe?

Primary mortgage.

So, on the vacation home, I owe about 500,000.

What do you owe on your home?

400,000. On the primary, worth about a million.

What's your income nowadays?

Household about household about 400.

Okay, so you got 900,000. You paid off 350,000 in the last year.

Correct.

If you stayed at that rate, you'd be debt free of both houses in three years. You're not going to stay at that rate, but you could do it in three to five years.

And that was kind of our plan. Just do everything. Say our goal is five years paid off and we're done.

I would do it. And if you hit a bump in the road, sell the vacation home in an instant. Don't hesitate, be done with it. But as long as you're moving smooth in a three to a five year plan, I would hold it and do it. Pay off your home first and the vacation home second, and then if the business hits, know if you have a pandemic problem or know. And it just stops one day because the Fauci pandemic comes back or something. Hopefully, Fauci won't come back, but his pandemic might. But anyway, it's all of that. So, yeah, pay off the vacation home second, and I think you're in good shape. You're doing good work. Proud of you. Hey, we're giving people permission to live here.

I can't believe it.

What a fun twice in a row. Wow.

Who says we're fuddy duddies?

Just the duddy. This is the Ramsey show. If current times have shown us anything, it's that the least expected events can and will happen and we have to deal with it. That's why everyone who has a family counting on them needs term life insurance. For over 25 years, the only insurance company I've recommended is Xander Insurance, not only because they search all of the top term life plans to find you the best rates but over the years, they have constantly changed and updated their systems to make the whole process simpler and easier. To get the protection needed, you can now apply with a completely touchless experience with everything being done either over the phone or the Internet. They also have plans with super competitive rates that don't require an exam, allowing you to skip a step and get the coverage you need faster. Go to xander.com or call 803 564282. Great rates and a simple process mean there's no excuse to not get this done, people. George Camel Ramsay personality is my co host today. Thank you for joining us, America. We're so glad you are here. Open phones at triple 8825-5225 Krista in charlote, North Carolina.

Hi, Krista. How are you?

Hey, Dave and George. I'm a little nervous but excited. I hope you all are doing well.

Better than we deserve. Happy to help. How can we?

Okay, so my question is what to do if we have a loan that they won't let us make extra payments. We've kind of come up with our own solution.

Who's your loan with?

It's a 401.

Oh. None of them allow extra payments. Okay. That's a standard part of the regulation. Okay.

Our solution. Do you want me to just jump into it?

Yeah, tell us what your solution is.

Okay, so the total on the loan was 18,000. We've got it down to about 1600. My husband just got a bonus and then we got an income tax return. I know. Shame, shame. But we went ahead and went through our bank and took out a personal loan to cover the difference to pay off the 401 loan. Then we can throw as much as we can on the extra payments towards the personal loan.

So you took out debt to pay off the debt.

So you've already done it.

Great.

So really, what's your question?

You've already done.

You said you couldn't make extra payments.

They can't.

Well, we have enough to pay it in full with the bonus and the tax return. We were just a little short.

What's a little?

Like right around 4200.

All right. And then you're just going to attack that and pay it off very rapidly, right?

Yes.

It's not the end of the world. It's not what I would have done, but it's not the end of the world. Okay. So what we tell folks to do is just set up an account, a savings account. This is your last debt or the place you are in the debt, snowball. And just pile up money until you've got 16. Nine in there. And then write them a check. They will take a lump sum.

Okay.

Which is what you're discovering.

I told my husband that's what you would say. I was just nervous to have the money sitting there where we could get to it.

Well, that's a different issue.

We've got to build that habit separately because you're always going to have some money sitting there.

I got money sitting there. None of it makes me nervous.

But.

I've been in control for 30 years after I was out of control. So I don't know. How long have you all been in control?

Since about December.

Okay, well, that would be normal to be nervous. Then what do you take record. All the years prior to December, you were out of control and you got, what, three whole months of in control. So, yeah, that makes sense that you're nervous, but the bank loan doesn't get rid of it. I mean, you still got the debt, so it was just an illusion. But here's the thing. Just work on going forward like you are managing money well and then manage money well. Act like you've made these adjustments and they're permanent in your behaviors. Okay.

Yes.

You've done good. You've done.

It has me nervous thinking about it.

Is this all of your debt?

Do you have other debts for that? So we started in December. We actually took your class once in 2016, once in 2017. But, yeah, obviously it took a few years to get back on it.

Let me take it again.

50,000. I am. We are right now.

Okay.

We are right now. So excited about that. So we started off with 50 in December, 4000 on a credit card, 18,000 was the 401K loan and 28 on a car loan. And we just made the last payment on the credit.

Personal finance, as you know from financial peace University, is 80% behavior. The reason you're nervous is you flunked the class twice. Right?

Exactly.

I mean, it's not being mean. You did not change your habits permanently, so now you're going back for a third time, and your pattern of not following through is ratling around in your brain. And it should be. That's wisdom. So, yeah, that's okay. But what I want is, I want your future to be better than that. Because we love you. We want your future to be peace because you are in control. Your money is boring, not stress inducing, because it's doing everything it's told to do. Instead of you wondering where it went, you no longer dread you misbehaving because it's been so long since you have misbehaved. And so I have the benefit of it being 30 years since I went bankrupt, 32 years since I went. No, it's longer than that now. 36.

Oh, my goodness.

Yeah. Anyway, so I got a lot of years of behaving after my extreme misbehavior, so I'm real calm about it nowadays. But back in those days, nobody was happy with what Dave was doing, including Dave or his wife or anybody else.

Right.

So I get it. I understand.

And now Sharon's always happy with Dave.

Well, hypothetically, but let's not push it too far.

But analogy broke down.

Yeah, it's money, money wise. Yeah, there we. So. But, yeah, it's a pretty simple thing. But you're building trust with others and yourself with your steady positive behaviors, and that matters a lot. It changes everything.

Well, people think my identity is I'm bad with money. No, you've been bad with money. You've made mistakes. But as long as you believe that, you're never going to know.

James Clear is going to be speaking at the entree leadership summit this year, the famous atomic habits book. And I've known James a long time before he was this massive author. That book has done so well. I'm so proud of him. But it is a great book. And the whole concept there was not, I'm going to grip my teeth and change my habits. Basically, the core thesis, at least part of it, on atomic habits, is I'm going to change my identity. Craig Groeschel and I talked about that on his leadership podcast one day. We're talking about James and this idea of, I'm going to start saying, this is who I am. Not that's who. I'm horrible with money. I'm not good at math. I have no impulse control. I'm bad at Amazon. I don't know, whatever it is you say about yourself, first thing is you have to say, not me. I'm not that way.

I'm an intentional spender. I'm someone who doesn't do life with payments.

I mean, there was an identity. There was a period of time during the Fauci pandemic that I ate every donut in a 50 miles radius because I was stress induced donut eating. Right. Yeah, but I had to decide, I'm a guy that doesn't eat too much. I'm a guy that doesn't overeat and is not going to be grossly obese. I had to decide that because I became grossly obese. It was crazy because I ate every donut. So I haven't had a donut. I don't eat donuts.

That's who you are. I don't tempt him with a donut.

And I get up on Saturday mornings when I'm at home, and I take a half dozen donuts to each grandkid's house, and I don't even eat one. That's how good I am.

I actually tried to tempt you the other day with a donut. It was a get behind.

I might do something else that's evil and bad, but it won't be a donut. So you just self identify, right? That's all I'm saying. And I'm saying I'm capable of doing stupid stuff, too. You are. Everybody is. But you start going, and the one I love is where you go. It's like a besetting sin. From your family. Our family has always been. It's like a recessive trait. What's going on? Stop it. Don't marry your cousin. Stop it. This can stop now. You don't have to replicate these stupid decisions.

You can change the gene pool or.

The ones people that grew up in my neighborhood. Well, somebody got out something in the water, and it's like, people that are my race, people that are immigrants, people that aren't immigrants, people that are bald, people that have great hair. I mean, whatever it is, everybody's got, like, that's your excuse? You don't understand. I've got a bunch of kids. Well, so what? People, a bunch of kids get rich all the time because some of them have to to feed them all. And so you know what I mean? It's like. Don't tell me everybody's got, like, some reason. Don't self identify with failure. That's the point. And that's not some muckety muck positive thinking deal, although it is. But it's the reality of people who are wealthy. It's why you become who you hang around with, too, by the way, because you're self identifying with those people we.

Found in a millionaire study. 97% of them believe they control their.

Financial destiny, and 69% of the public does belief. Tada. There it is. There's a correlation there, and it has causation. For those of you into research, this is the Ramsay show. Hey, you guys know this, but I'll say it anyway. College is freaking expensive, and student loans are out of control. The average private student loan in 2023 was $55,000. So if you're in over your head with private student loan debt, don't beat yourself up. Look, we've all made mistakes with money in the past. What matters is doing something about it now. So if you're in distress with private student loans, call y Refi. Y refi refinances defaulted private student loans that other places won't touch and gives you a custom loan built for you based on your ability to pay. To learn more, call 8442 ramsay or go to yrefi.com ramsay. That's 8442 Ramsay. Or the letter y, then refy.com ramsay.

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George Camel, Ramsey personality, is my co host today in the lobby of Ramsey solutions on the debt free stage. Brian and Joanna are with us. Hey, guys. How are you?

Great, Dave.

Great, Dave. Good to have you guys. Where do you live? Toronto, Ohio. Oh, fun. Welcome to Nashville. And how much debt have you guys paid off? $215,000. Wow. How long did that take? 61 months total, but we did 120 in the past ten months. Whoa. Getting it. Okay. All right, big time. And your range of income during that 61 months? Started at 150,000. Up to 240. Cool. What do you guys do for a living? I'm a family physician, and Joanna is home with the kids. Awesome. Very cool. So your practice took off? I went from the Navy to private practice. Oh, that'll do it. Okay. All right. Good for you guys. What kind of debt was the 215?

It was our mortgage paid off.

Your house? Looking at weird people. I love it. Way to go, you guys. Awesome. What's this house worth? About 380,000. I love it. Oh, and it's out in the country. You got some acreage with it? I saw it just pop up on YouTube.

We have a farm.

Yeah? How many acres?

About five.

Oh, very nice. It's a good place for kids.

Exactly.

Excellent. Excellent. Very cool. So is Toronto a rural area? I don't know. That city. It is. It's about 40 minutes west of Pittsburgh. Oh, okay. Yeah. Okay. I know the area. Very cool. Good for you guys. Okay, so what made you decide we're paying off the house and everything?

Well, our story starts about 17 years ago. When we were engaged, we took financial peace. I dragged Brian there kicking and screaming.

A newly graduated MD?

Not even.

Actually.

We were in college. We were seniors in college. We met at Franciscan University, and we were not on the same page about money. And so I convinced him, if I paid for it, would he go with me. And so we went, and after the first class, he was sold. And that's when we really put this as our goal. Someday we want to have a paid off house, we want acreage, and we want a large family. And it's kind of surreal that we're here now.

What happened, though, was during COVID I almost lost my job because of the vaccine mandate. And so it really put a fire on us to make sure that we were completely debt free, including the mortgage, so that no matter what happened, we'd be safe. Okay, so they were mandating you get one and you didn't. Correct. Okay. And so you're in private practice now where you control that? No, I mean, I work for a hospital system, so they're mandating it through the government, so I had to fight that back. Oh, I got it. Okay. All right. Wow. That got. You lit that fire in that last, what was it, ten months? You went crazy.

Yeah. We actually had built up a bunch of cash reserves in case Brian had to open up his own practice suddenly. And so when we came through that time, we said, okay, let's get really busy about this house, so we're not worried if something happens again. And so we decided to take that big chunk of change we had been saving aggressively in case he needed to leave his job quickly. And we put on the house and we drained everything except retirement and our emergency fund and threw it at the house in these last ten months. And then we've just been scraping everything we can. Brian's been teaching butchering workshops. Wow. We raise all our own meat now on our farm and butcher it on our farms.

I wish you had said that first.

We had six.

A doctor giving butchering cons. It's bothering me.

The farm, not theatomy.

Really well.

Oh, man. So that's cool. Well, because homesteading and raising your own stuff is huge. It's a big movement. And so people lining up to take that class and to learn how to do what you guys are doing, because the freedom of it and the independence of it, where you're not dependent on someone who's mandating something on you that you don't want to do, and you're the guy with a medical degree figure that isn't that interesting. Yeah, we're not going there. We're just going to celebrate with you that your farm is paid for and it's worth 380,000. How much have you got in retirement? About another 350. Okay, so you're approaching millionaire already. Well done. And you brought the kiddos with you. How many of them are there? We have six. Wow. They're all with you. And what are the age range? 15. Down to one. All right. Very.

That's a party.

Very cool.

Farm workers right there.

That's right. Well, and shock of shocks. They're well behaved. Okay. When there's two, they're climbing the walls. Right. But they line up like the pick. Amazing. It's just like, perfect. All right, names and ages. Let me hear who they are. So if Joseph, who's 15, we have Killian, who's twelve, Fulton is ten, Cormac is seven, Rosie is three, Jamie is one. Way to go, Jamie.

You must lose track of one. That's impressive.

That's good.

Wow.

So how does it feel to not have any payments?

It's kind of surreal. This is our first family vacation, Dave. That isn't just to visit family. So we're going down to Texas and we're a little crazy.

Go for it. Be a little crazy. You earned it. You're almost millionaires. You're doc, you make good money, you got freedom now. I'm so proud of. Thank you. Yeah, it is amazing. And as you said, it's freeing to where now I do what I want to do because I want to serve people and I want to be there because I want to be there, not because I have to be there. Yeah. And I'm not going to be forced into something to pay a bill.

Right.

That I don't want to do to my body. Way to go. Good for you all. So proud of you all. Excellent, excellent work. Very cool. What advice do you have for somebody that wants to get out of debt?

For us, it was contentment. Knowing our why and the budget. We've been doing the budgeting since we were printing them off. Every month we have our first paper budget we ever did. I love it. I would say having that monthly budget meeting is key, but no matter what income we have, just learning contentment.

Yeah. Good job, you guys. Way to go. Proud of you. All right, it's Brian and Joanna and the powerful six. Way to go. Count it down. 215,000 paid off in 61 months, with most of that in the last ten months making 150 to 240. Count it down. Let's hear a debt free scream. Three, two, one.

We're debt free.

Yeah. Wow.

That was the most behaved debt free scream I've seen with six children in it.

That's impressive ever. That's excellent. Very, very cool. What a great family and what a great story. That's so exciting. And sometimes we hear people say, you can't do this Ramsey stuff if you have a big family. So I rest my case. Somehow they did it. Somehow they figured it out.

They're like, we'll raise our own cattle if we have to feed these kids.

Yeah, apparently. Yeah, that's good. It's good stuff. I mean, it's possible and it's probable when you make the decision to do the right thing and there's some trade offs. But the powerful trade off is now he's in a position to not feel the stress or the pressure if something else comes along in the medical community. That's not ethical for him.

Yeah.

And then he's not forced into something he doesn't have to be because so many people did stuff because their income was dependent upon it, not because they believed it, a lot of them. And so it's wild. That's a lesson that we can learn from that time, is that freedom, one of the things that financial freedom gives you is it gives you choices with.

Your career, with where you live, with.

How you live, who I want to work for. I don't have to put up with this crap anymore. If they start yelling at you, just start walking off. Where are you going? I don't have any payments.

Keep walking.

Changes everything, right? Why would I work here? Why would I work for somebody like you? I don't have any payments.

That is impressive.

Nobody's going to put up with that.

And they are such the anomaly because most docs out there, they just raise their lifestyle as they make more money and they continue to live on less than they made and go, what if we could send all of that money to the mortgage so that we don't have a payment in a few years?

Yeah. And there's so much. And a lot of life happened during, from that first financial peace class 17 years ago to now.

Six kids. That's one part of the life.

That's a lot of life, man.

That is impressive on its own, pun intended.

But they're heroes, or absolute heroes. They took control of their lives, and that's what you guys can do out there. And that's why we have debt free screams on here.

And they gave us the secret. The big mortgage hack, Dave. Apply extra to the principal. Ooh, look at that.

That's like smoking Mary.

And if you got a big pile of money, throw it at the principal.

You need a TikTok channel.

It would be too short of a TikTok. Now, how do you pay off debt?

Pay more off.

Pay it off. That's too simple, Dave. It needs to be more sophisticated.

I gotta chill.

They did it.

This is the Ramsey show. Keeping up with the stock market and all the investing opinions out there is exhausting and is probably steering you in the wrong direction. Building wealth shouldn't be this confusing. And it doesn't have to be. On May 21 and 22nd, we're doing a brand new virtual event on the number one topic you've asked to learn more about investing. For two nights, I'll unpack everything from my playbook you need to know about investing. Mutual funds, real estate, 401 ks, all of it. I can't wait to dive into this with you. Plus, you get to submit your own questions for me to answer live. And since it's virtual, you can watch this right from your home. I know investing can be confusing, but you can feel confident that you're investing the best way for your future. Listen, I don't care who you are or how much money you make. It's never too late to start building wealth. Early bird tickets are just 199. Get yours@ramsaysolutions.com Investing essentials before the prices go up. George Campbell Ramsay personality is my co host. Thanks for joining us. Avi is with us in Philadelphia. Is it Avi?

Is that correct?

Yes, that's correct.

Cool. How can we help?

How you doing, guys?

Better than we deserve.

Great. Love it. So I've been working for a service business for about give or take, six years back in 2010, I opened my own in about 2016, trying to expand my income. Transitioned from a service company to a construction company, and in the meantime got married, built a family. My question is as follows. I have now just started the calculating my budget, and I figured out that I either need to address my personal income and expenses or change the business kind of model to be able to match my personal income. Essentially, I'm paying myself from the business, but not enough. They're not matching up.

Yeah. So how much do you pay yourself from the business?

Well, I don't. That's the biggest problem. I've been mixing personal and business expenses since I started. I didn't know anything about business. I just knew what I was providing the service. I'm looking now to separate the two. And how much do I pay myself? Do I pay myself what my personal budget is needing, or do I pay myself what my business can handle?

It doesn't matter. You're going to be taxed on your profits on the business regardless. And you have been all along. Are you current on your taxes?

No.

How far behind are you on taxes?

About two years.

I would say, okay, you need to.

Take care of that quarterly, but not yearly.

Well, if you don't, not filing federal income tax returns is a criminal offense. They put 2711 people in jail last year for that. So not filing is not okay. Not paying is a different issue. That's not criminal. They'll just drive you into the dirt. But not paying is not criminal. So you need to get that part of your life cleaned up immediately. And we'll go ahead and answer your question as a part of this. But jump online@ramsaysolutions.com and talk with one of our tax elps, and they can help you get current and set yourself on a system to stay current. Now, this will also help you do your taxes and your quarterlies on time and accurately. And that is simply this. You need to open a separate checking account for your business from your personal. I assume you have a checking account. Is it in the business name or your personal name?

No, I have everything separated.

You just don't have it separated. Okay. So now that the business account is open, 100% of the income that goes into the business account is only business. The only thing that comes out of the business account is business. Never again pay anything personal out of that account the rest of your life, ever.

Yeah, I spent the past three months separating those. I started with your, well, you told.

Us you weren't separated, so I'm telling you to separate it. Yeah. Okay. All right. So now you're separated, and 100% of the time, this is a business expense. You use the correct debit card, the correct checking account. 100% of the time, it's a personal expense. You use your personal account. Now, what does it take? If you've laid out a budget, you don't know what it takes to operate your household, right? You told me that. Okay, so what profits do you think you've made in a given year? What do you think the business makes profit that you're going to end up paying income tax on?

I believe I'm operating at a loss right now.

Then how is your family eating?

Because, well, I'm accruing debt. That's my problem.

So you're borrowing money to eat and stay open?

Not really. Yeah, let me put it that way. I've been paying.

Are you living off of credit cards?

Exactly.

So now we stopped in December of 23.

And how much credit card debt do you have personal?

About 50K.

Okay.

What other debt do you have.

Personal or business?

They're all personal.

So business.

I have about 80 on top of the credit cards. And I assume then you have the IRS taxes. Do you know how much that is?

No. Quarterly. So I have not filed it.

Correct. Yeah. Okay. Yeah, we're not sure.

So that's going to go to the top of your debt payoff list.

But you shouldn't have any taxes if you're not profitable. So why are you paying quarterlies.

Based off sales? I've been doing it myself. Not really sure.

Okay. Dude, you're a hot mess.

Yeah. Okay.

So there's so many things going on here. The first thing we have to do with the business side is we have to figure out if the business is really profitable or not. If you are running a business at a loss, it is not a business. It is a hobby. Close it and go get a dead gum job. If you're really losing $50,000 a year, why keep doing it? That's dumber than crud. So you have to get this business where it brings in more than it spends and it actually makes a profit to feed your family. Whatever the profits are is the most you can take home. You cannot run a company and fund it with debt. It won't work. It's not sustainable. There's obviously an end to that. You'll hit the wall like you're a nAscar. Okay. And it'll be engine up in the stands, disintegrated vehicle. That's what's going to happen. So you've got to stop this. You need to be in panic mode on your taxes and on your accounting because both of them suck beyond belief here. So once you get the business under control and you can tell if it's making money and decide whether to leave it open, then you can say, what?

I've got to have come home. Now you can build a household budget based on household expenses. Get the everydollar app and download it. And you can look at it and say, all right, I need this much in my food, this much in my electricity, this much to keep the cars running, this much to pay the credit card debt, this much to monthly. This much to buy diapers or whatever it is, I don't care. You just make a list of your monthly expenses and total them up. And that's going to give you an idea what it takes to operate your household. It won't be completely accurate because your stuff is so chaotic that you're not going to be able to tell. But at least get started there and at least go over on the business side and let's start running the business with a monthly profit and loss. So when you contact our tax Elp to get your taxes caught up and filed. Also sit down with them and ask them if they help with small business bookkeeping. Most of them do. And they can help you set up a small business bookkeeping system and get you started on running this business and telling yourself if it's a profit or not.

It could just be as simple as you need to get organized and raise your prices a little bit and actually collect from your customers on time. Because I don't think you're only $50,000 in credit card debt if you've been running this business all this time at no profit. So something's wrong with that story. You've been making a profit somewhere. I just can't tell how much. And you can't either. Listen, what you're doing, it's freaking amazing that you've survived as long as you have. What you're doing is not sustainable. It's stress inducing. You're going to be living panic attack. To panic attack your spouse is too. That much chaos in your finances will ruin your life and it'll keep you from all your hard work from causing prosperity because you're working your butt off, it sounds like. But you can't tell if you're doing anything. Just like a rat in a wheel run, have a heart attack and die of anxiety. Don't do that. Okay. Get out of the wheel. Sit down. Let's lay out a game plan. Execute, execute, execute. And the numbers will talk to you and tell you where you're out of line.

But I don't know if your business is out of line or not. Where it's out of line or not. I know it's out of line. I know one place is it doesn't have an accounting system. The second thing is then you get your home in place. Now, if the business is making $80,000 a year, you're getting taxed on $80,000 a Year. You can bring Home $80,000 a Year and the Business will run just fine. If the Business is making $72,500, you can bring home $72,500. If you leave a little bit in there, in addition to that, you pay taxes on it anyway. But you leave some in there to Reinvest and grow the business, that's okay, too. But you can set that up once you actually know what the numbers are.

Got to know the Basics. And there's a great free guide that our entree leadership team put together. This is Dave's playbook for how to build a Business. It's called Entree Leaders Guide to Business Finances. So I encourage you, AVi, and anyone else listening to go check this out. It's completely free@entreeleadership.com. Slash Finances. And this is the Playbook that DAve's talking about. Here's how to set it all up. Here's how to run a business debt free so that you have prosperity and peace.

Scripture says, be diligent to know the State of your FLocks and Herds. Obviously, Solomon wrote that ProveRb in an agrarian culture where flocks and herds were representative of wealth. So if you don't keep up with the lambs and you don't watch for the wolves, you go down. That's what this is. This is the Ramsey show live from the headquarters of Ramsey Solutions. It's the Ramsey show, where we help people build wealth, do work that they love, and create actual amazing relationships. George Camel Ramsey personality number one bestselling author of the book breaking Free from Broke. I'm looking at it behind me back here. Big orange book sticking out and a big seller. George has done very well with that. Also, big YouTube star on Smart money, happy Hour and the George Camel show, one of the fastest growing shows on the Ramsay network on YouTube. Thanks for joining me, George. We're going to answer folks questions today. The phone number is triple 8825-5225 Joseph is in Knoxville to start this hour. Hi, Joseph. How are you?

Good. Thank you so much for taking my call.

Sure, man. What's up?

So I've been living paycheck to paycheck my whole life, pretty much. And I'm at a point where the money I'm making, it's not okay with me anymore.

Good for you.

I've eliminated about five just little credit cards here and there that add up. And I got about four monsters left as far as my home, a truck payment, credit card, and a personal loan. And I'm trying to figure out how to execute that.

Okay, great. So I'm going to help you lay out a budget. That's the key to all of this. Have you heard of every dollar before?

Yes, I just filled that out yesterday.

Great. So what's your income? You list out at the top.

I net right at $122 a year.

Amazing. Okay. Are you doing any investing right now?

I actually paused my works 401K because it didn't make sense to me to put money to the side that's being matched when I have credit cards that are taking that away.

Joseph, you are getting it. All right, great. So what's left on the truck loan?

23.

And the credit cards.

The credit card is at 15 right now of a 16 limit. And then the personal loan is a nasty one. Whenever I take these out, I try to pay them as quick as possible. That's at payoff at a 12,000. But if I let it go its entire life, it's double that.

No, we're not doing that. It's going to die soon.

What kind of personal loan is this?

A bad one. It was just a personal loan to get me through. We had a new baby a couple of years ago and that was we did a home delivery, so we had to pay out of pocket for that and a few other things here and there and then bad spending habits.

So you've got minimum payments on each of these, right on the truck, the credit cards, the personal loan.

I do. And I put 50% of my work income because I have two retired military early retirement there. And so my work income that I have is gross 80 a year. And I just now put 50% of that into a separate account as like the emergency fund. And once I match that, I dump the other part into a debt.

So what do you have in savings right now? In liquid cash?

Right now? Probably about 2000. I just dumped 2200 into that credit card.

Okay, so the simpler way to do all of this is you're going to list out all of the necessities, your four walls, food, utility, shelter, transportation, insurance bills. Beyond that, we're going to cut all of the nonessentials from our life and the rest we're going to attack the debt with. And so when you make your every dollar budget in the debt section, you're going to list all of the minimum payments as well as the loan balances and whatever the smallest debt is, I'm assuming it's going to be that personal loan. You're going to throw as much as you can with all the margin you've created because you're living on less than you make. You've cut all the fluff out of your budget. Now you're going to take that extra five hundred dollars to one thousand dollars, four thousand dollars, and throw it at that smallest debt while making minimum payments on the other.

No reason to move it through a savings and back out. Just put it all on there. Set $1,000 aside. That's baby step one as your miniature starter emergency fund. Don't let that get below that. For any emergencies and everything else you can squeeze out of your life, you attack with a vengeance like your hair is on fire. That smallest stupid high interest personal debt that makes throw up in your throat come up into your mouth when you talk about it. A while ago I heard it. You need to get rid of that thing fast. It needs to die, like right now. Like everything don't go out to eat and we're not going on vacation. We don't do nothing. We're getting these debts cleaned up. You hear that?

Yeah, I do that.

Crazy.

All my streaming services and everything, everything's gone.

Everything's gone.

So you're bringing home ten grand a month. So you should have thousands of dollars.

How much is your house payment?

It is $1,800.

Okay. Yeah. When you squeeze your budget down, you're going to be able to do probably 3000 or $4,000 a month on this.

Yeah.

The good news is it's just going to be for a short period of time because you're going to three months.

The personal loan is gone.

Yeah. And you free more months or four more months, the credit card is gone and then the truck's on the way. So you're going to be debt free in like a year of super intensity. People think you've lost your mind, focus. And of course that means your wife has to be on board with all this because you're married and got a baby. Right.

I have five kids and my wife 15 years.

Yeah. So this is a short period of time. We're going to pay a price to win. We're going to live like no one else so that later we can live and give like no one else. There's an intensity that goes with this. We call it gazelle intensity. Like the gazelle running from the cheetah for its life. Because you woke up the other day and went, this isn't working. Something has to change. The best way to change behavior is dramatically overdo it for a short period of time.

Yeah. And I've given it attempts my whole life because my dad's followed you, so I've just known your name forever. But when I see the look on people's face when I'm getting intense with it, family and they're sad or they wanted to go do something, who cares? I give in.

They don't have five kids and they don't make $120,000 a year and broke, who cares? When you reach the point you don't give a crap what people think, then you got a chance because you can't please all the broke people in our society that have an agenda for your money.

Yeah.

When you break through that, then you're just going to be a dad and a husband that's a completely different dude. Because you're going to be like, mission game on. Full mission face. We're not doing nothing else. When that happens, then that's when people change their lives. You're on track. I'm hearing all the right verbs, all the right usage of language in the sentence structure of somebody who's getting ready to win.

Yeah, you're getting intense. And you said, the kids are the ones who are coming at me going, well, we can't. You tell the kids daddy and mommy are broke. We don't have the money for it.

Tell my friends and the kids no is a complete sentence.

Dave's always said, you don't let the inmates run the asylum.

Yeah, no, sorry, can't do. Well, there's always therapy later on, if you want to write to me, we can talk about your opinion, but until then, your opinion is worth what you paid for it. Zippo. So sorry, my friend. No, sorry. It's a highly offensive word. If you tell people no in our culture these days, they go bananas and pick at know. It's like, no, that does hurt my.

Feelings the more you say it.

Dave, are you triggered?

I'm just trying to live my truth out here. You're just telling me.

No, your truth. See, there's the problem right there.

I know where all Dave's buttons are, and I love pushing.

Just push them. Just push them. Just. George is, that's my co host right here. He's just playing the, it's part of the game of phone, part of the machine buttons. Hang on, Joseph. We're gonna help you out. We want you to go through financial peace University as our guest to go with your every dollar subscription. You need to do all that because you're going to win. You call us back and we want to hear your success or any questions you got in the future. We want to help you. This is the Ramsey show, folks. Changing your family tree takes more than rice and beans and side hustles. It's also about transferring the big financial risks off your family by having the right kinds of coverage in place. That's why my team created the coverage checkup quiz. It only takes about five minutes to find out what types of insurance you need and don't need to protect your finances. Make this quiz one of your regular checkups, starting right now@ramsaysolutions.com. Slash checkup. That's ramsaysolutions.com Slash checkup. George Camel Ramsey personality is my co host today. Thank you for joining us, folks. It's tax season. If you need a tax pro or you want the Ramsey smart tax software, the best and easiest tax software to use anywhere.

You can get that, of course@ramsaysolutions.com. Slash tax, you can hook up with one of our tax elps if you've got a complicated return, if you got a simple return, don't use those other guys. They're trying to sell you a bunch of crap like credit cards and everything else and hidden fees.

And we fix, we'll advance your refund with a loan. That one disgusts me.

This question comes in from one of our listeners. Are there penalties for filing a tax extension? No. The tax extension itself does not create a penalty. Not paying your taxes when you file, let's say you owe $1,000 and you file an extension from April to October, you will pay penalties on the $1,000 taxes that you owe if you don't pay it. So whatever your tax that's due, you should pay it when you file the extension. The extension is not extending the payment, it's extending the filing. And so if your return is complicated or screwed up or there's something in flux, pay the proper amount of taxes and file an extension. During the extension period, do your filing, but it does not extend the tax liability. You will be penalized and get late fees and penalties and interest and everything else on the amount you don't pay. So do not people think, well, I can't pay, so I'm just going to extend. No, that's not how that works, baby. It's not how that works. So it doesn't work that way at all. You're going to get penalized the whole time. And the last person you want to be in debt to is the freaking KGB.

I mean, the IRS are the top.

Of the debt snowball.

Yes, that's bad news.

So the key here is when you request that extension, you have to estimate your total taxes owed and compare that to how much you paid in federal taxes during the year. That will tell you if you have a tax bill. But if you're going to go through all that hassle, just go ahead and file your tax return on time, but you got to pay by the deadline.

I've been in a situation about three times in my career where there was a complication to where we really could not file an accurate return. We had an idea where we're going to land, but we had to get a couple other things in that just were not in, not our fault. So I filed an extension a couple of times, but I paid the taxes.

Because what, your estimation?

Never, ever want those people in my life. I've coached too many people with the IRs in their life, and it's just the last thing you want. You think Mastercard and american express is evil? You just wait. You try these guys on, garnish your.

Wages, and destroy your life.

Well, they're the only debt that does not have to go to court to start taking your stuff. So you just don't want to screw around with these guys. They got a lot of power, and the penalties are ridiculous, all that. So filing an extension is not an extension on payment. You got to figure out what you think it's going to be and pay that. And even if when you file a return, actually, they may actually owe you a little bit back if you did, overdid it, because you're guessing at that point. Educated guess, but you're guessing. So. Ramseysolutions.com slash tax for the Ramsey smart tax software. The best in the business. Very inexpensive, no hidden fees, no salesman will call, no gotchas. And if you got a complicated return, get with one of our tax pros that we've vetted. They are ramsay trusted. Zach is in Los Angeles. Hey, Zach. Welcome to the Ramsay show.

Thank you. Thank you for having me.

Sure.

To speak to you.

You too. How can we help?

So I have a quick question. So I'm debt free. I'm 28 years old. I actually just got a promotion, and I make about a little over $100,000 a year. And I was wondering if I should be saving for a house or investing in my 401K or both, because my company does something interesting with the 401K, where it does 5% match. But then on top of that, regardless of how much I put in, they put in 5% of my salary.

So you're forced to do 5%?

No, regardless. No, not forced. They put in 5%?

Yeah, they put in 5%.

So you make 100K. They'll put in an extra 5000 for you. On top of the match.

Correct.

Cool. Okay, well, you're at what we would call baby step three B. If you have a fully funded emergency fund, do you have that in place in your savings?

I do.

Awesome. So this is a choose your own adventure, my friend. And based on your age and your goals and your priorities, you could invest up to the match and put the rest in a down payment fund. You could invest 15%, whatever's left over, doing the down payment. Some people choose to do 0% investing while they get really intense and save up that down payment. In a year or two?

Yeah. How fired up are you on getting a house? How jacked are you?

Pretty fired up. Okay, I am.

Because enough to give up that 5% for one year while you do a down payment?

I could, yeah.

Okay. Or do you want to do the 5%? Do the down payment. Above that, either one is okay.

It's 5000 a year that you could have put toward the down payment. And if I'm in your shoes, I can tell you're hungry to invest. You're a young guy making good money. So I think you put 5% in to get the match and then anything else beyond that becomes the down payment fund. And you'd be okay with being a little more patient.

Let me clarify something. The 5% that they give you, that's not the match. Are you required to be putting money in the. Get that?

No.

Okay. So you get that either way?

Yes.

Okay. So if you put in 5%, they're going to match 5% and give you an additional 5% whether you put money in there or not.

Correct.

Okay, very good. And you said you're 20. How old?

I'm 28.

Okay. All right. And you're single, it sounds like?

No, I actually have a girlfriend I'm planning to propose later this year.

Congratulations. You're single, you're not married. When you're married, we'll change the equation. Maybe. But yeah, we got to take care of all that stuff, too. And it's okay if you're getting engaged and you think you might get married when?

Let's see, maybe a year and a half, maybe two years.

Okay. I'm going to recommend you buy your house after marriage, of course.

Yeah.

So you got from now until then to save a down payment with your income. Unless there's a bunch of other stuff coming out of your budget we haven't discussed, then I think you could put in 5% pretty easy and still save your down payment, don't you? In a year and a half?

I do.

Okay. That's probably a good plan. But you can choose to do any of these. They're okay in our plan.

Okay.

But once you've got your house purchased ready, then you go to baby step four solid, which is 15% of your income going into retirement, regardless of the math. Okay. But past that you don't. And then of course, just my experience of coaching young families and young people being engaged and so forth over the last 30 something years tells me you will choose a better house after marriage. Because if you buy a house without her before marriage, it'll be the wrong one. Okay. And all the married people got that joke.

It's a joke. And also not a joke. It's fun how that works.

It takes about a year of being married to know how close to your mother in law to buy. So these are the jokes.

Right.

So it just takes. It's okay to not be in too big a hurry on the home, but.

Especially if he's in the La area, anywhere in California, it may take a little while.

I missed that.

Might be a sizable down payment just to get a reasonable.

It might be two, two and a half years to make the purchase, but either way, I'm probably going ahead and do the 5%. Yeah, we'll add her income to the equation. After marriage, she's debt free as well. That'll increase the savings issue too. And, yeah, all of that happens.

That's a game changer. That's what happened with Whitney and I. She works here at Ramsay. We got married. She was smarter than me, better looking, better with money.

So we get trying to figure this out.

I don't understand it. It's the charm, Dave. You'll get it one day.

Yeah, it's the humor, the millennial.

You know, the key financially, and people hate this, but the key was we were dinks. Dual income, no kids. And then we became dink wads, dual income, no kids, with a dog.

And then we got the Frenchie s, which is two with a dog's, multiple frenchies. And now we're finally figured it out and got a baby.

Exactly.

There it is. Okay.

We got there eventually. But that is a man. If you're young and both of you are working, what an incredible time to build wealth together. And buying a home together is a really special thing. So I'm waiting till you're married, because Dave's right. You chose the wrong countertop and cabinet colors, my son.

Dinkwad.

Dinkwad.

Oh, God.

Don't call me that.

What a world.

I'm no longer a Dinkwad, Dave.

What a world. 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 Ramsay 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 ramsaysolutions.com store. George Camel Ramsay personality is my cohost. Tasha is with us in Denver. Hi, Tasha. Welcome to the Ramsey show.

Hi there. Thank you so much for having me. That's a blessing to be on. So thank you so much.

Sure. What's up?

So basically, my husband and I just want to know if it's a good idea if we should use our four hundred and one k to buy a business.

How old are you?

His boss is retiring. I'm 36 and he's 40.

No.

Okay.

Let me tell you why and then see if you agree with me. Okay?

Okay.

When you pull money out of a your age, you are charged a 10% penalty plus your tax rate. And so they're going to take approximately 40% of the money. So it's the same thing as calling me and saying, dave, I want to borrow money at 40% interest to buy a business. To which I would say, no.

Okay.

You wouldn't borrow money at 40% interest, would you?

No, I wouldn't.

Okay, good.

Do you have any other recommendations?

How much is the business?

The business is for 250,000, and his boss is asking 50,000 down.

Okay.

When's the rest due?

In September. Throughout. The rest is going to be due.

They're going to borrow the 50,000 is what they're going to do. Or buy the cash out for the 50 grand, not the whole thing. The boss is going to carry the other 200, right?

Yeah.

Okay. All right. Let's see if we can restructure this a minute. Let me learn some things about the situation, then I'll have a suggestion. Okay.

Okay.

We have found that I work with small businesses, 10,000 of them right now through entree leadership. And we know that the SBA statistics are correct, that 80% of the small businesses fail that start up. You won't be starting up, you'll be buying existing. So that gives you an advantage. But 80% fail in the first five years. The reason that's important is why do they fail? Of the 80%, by far, the number one reason the small businesses fail is what they describe as cash flow problems. When we go in and do an autopsy on them after they die, we find two things that are called cash flow problems. One is they don't pay their freaking taxes, they don't do their quarterly estimates, they don't keep a good set of books, and they get behind with the IRS, which will take you out. They will slit your throat just to say they did. Okay. It's like their goal in life. The second thing that causes cash flow problems in quotes is debt. Debt payments. Because you got debt payments whether you're making money or whether you don't make money. And that takes people out. So I have taught small business people for a couple of decades and regular people that aren't in business to not borrow money.

Now, how do we go live your dream, though? So on this business, do you guys know what the net profit is on the business? On the current owner's tax returns in.

A year, it is $500,000.

It makes a half a million dollars a year profit.

It does, yes.

Profit after all expenses are paid.

Profit after all expenses are paid.

I think you're talking about gross revenue.

Yeah. No, I'm sorry. It is gross revenue.

Okay. I was about to get excited because you had the deal of a century.

I know.

Okay. You don't have the deal of a century. What is the profit after all expenses are paid?

We don't know.

Okay.

Yes.

Then you don't know how to value the business yet. Okay. But I'm going to work you through an example and help you figure this out. Okay, let's pretend that the profit on the 500,000 after all expenses are paid, including paying the manager, which might be the owner, a reasonable manager fee. Like, if I was going to buy this business long distance and it was going to run on its own without me being in there working, what would be the net profit I would receive as an investor? That's what you're looking for? Okay. You understand that concept? Hello?

I do. Yeah.

Okay.

Sorry.

Okay. So you can go back and listen to this later. It'll be on the podcast. You can listen to it on YouTube, and you can catch up, if you need to, your husband in the background that you're translating for. Now, if it's making $50,000 a year, the value of the business is between four and five times the net profit. And so the business would be worth four times 50,000 or 200,005 times 50,000 or 250,000. I'm making that up because it matches his price.

Okay.

All right. So if it's making more than $50,000 a year, 250 is probably a pretty good buy. If it's making less than $50,000 a year after the manager is paid, you don't work there free. You get paid as a manager, then this is too much for this business. What kind of business is this?

It's a jewelry store. My husband's a jeweler.

And how long has it been there in this location?

For the last six years.

Okay, then the income stream ought to be pretty predictable. It shouldn't have varied a lot unless you're in a mall that's dying or something. Okay.

That's correct. Yeah. It's been pretty steady the last six years.

Okay. That's good news. So that makes it easy to put a value on. All right. Now, your husband's a jeweler. Good. He gets paid for being in the jewelry store, and then we create net profit. You follow me? So if I were going to hire someone to manage this store, you ask yourself, what would I pay them that comes out of this profit and loss statement? And then there's net profit. What is the real net profit? Because my employees areN't going to work for free, and I live in Nashville. You understand?

Thank you.

We're viewing it as an investor because that's what you are when you buy something. You're an investor. You're not just buying a job, you want to buy a business. Now, if that's 50,000, then this price is approximately correct. Do you understand my formula?

I do, yes.

Okay. Now here's where it gets a little bit more complicated. So hang on for the ride. Here we go. Around the corner. All right. Now, what I would propose to the owner is that your husband, what does he make now?

75,000.

How much?

75,000.

How many employees in the store?

There's two part time, and then my husband and then his boss. So four total.

Okay. All right. This thing's netting more than 50. Okay, good. All right. So I would propose to him, the owner, that your husband's going to run the store and not take out more than 75,000 until the owner is paid off and 100% of the profits above your husband getting paid $75,000 salary that the store makes go to pay off the owner until he's paid. So if we owe him 250,000 and it's making 50,000, then he'll be paid out in five years.

Okay.

If you make 100,000, he'd be paid out in two and a half years. And I think you're making more than 50. Honestly, listening to your numbers, if it's grossing 500, you got cost of goods sold, you got 75,000, a couple of part time employees. I think this thing is going to make a good profit, it sounds like, unless they got crummy margins on their jewelry. And most jewelry has got great markup, so I suspect you got strong Markup on this.

Is this a mall store?

No, it's a standalone.

Okay.

It's a family operated deal. Not a chain.

It is. Yeah, it is. That's correct.

Yeah. I think you're making bank and I'm glad for you. Okay. That's not a criticism. I want people to be successful. So anyway, if you can make 100 after you pay yourself 75, you give him the whole hundred. You follow me?

I do.

And so he gets his 250 as quick as the store makes that money. So he's going to get his money in two to five years, all of it.

Okay.

But if the pandemic comes, if we have a fauci. Pandemic, I don't know what that could happen. I've heard if that happened one time, like back in 2020, and you make nothing because no one comes in a jewelry store for six months, then you don't have a big old payment to your old boss who comes in and bankrupts your butt.

Okay.

That's what you don't want. You only pay him out of the profits. No profits, no payee. So he can wait like everybody else waits if bad things happen. So you don't run it in the dirt, you run it to super successful and pay him off really, really fast. And then you get to make a couple of hundred thousand a year out of this store and no debt. This is awesome. You. Our scripture of the day. Proverbs two, six and seven. For the Lord grants wisdom. From his mouth come knowledge and understanding. He grants a treasure of common sense. To the honest, he is a shield to those who walk with integrity. James Garfield says, the truth will set you free, but first it'll make you miserable.

Ain't that the truth?

Gotcha. Check that box. Wayne is with us in Lake Charles, Louisiana. Hi, Wayne. Welcome to the Ramsey show. Hey, Dave and George.

Thanks for having me.

Sure. What's up?

So, I have a question. I wanted to know if I should buy a pool or hold on to the money.

Okay. What are you going to spend on the pool?

60,000.

Okay. What's your household income?

200 to 225, depending on bonus.

Are you debt free? Except your home?

Correct.

Okay. What's your home worth?

380.

Okay. $60,000 pool. So you're probably going to increase the value only half of that?

Correct. And we have eleven years left on our house.

I don't think you're going to increase the value of your home equivalent to your spend. I think you're going to only increase it by about 30.

And that's fine. I mean, I want to have fun with my kids and we've been talking about it for years.

Okay.

So I just didn't know.

I'm guessing how many homes on your street have a pool that nice?

Probably four.

Okay. All right, so it's not weird in your neighborhood, but it's not standard, correct? That'd be about like my neighborhood, yeah. Okay.

How much money do you have saved?

So, in savings, I have a 30,000 emergency fund, 70,000 in a high yield savings, and then I have a quarter million in a 400 and 143 thousand in employee stock purchase program. And I'm also saving for a kids college.

Good for you. Great job. Yeah. I'd buy the pool.

You would?

Okay.

I just never feel like I'll have enough money, so I kind of don't want to get rid of the cash, if that makes sense.

Yeah, well, that's the good news about cash, is it makes you stop and think. When you use other people's money and you borrow it, people don't even think. They just go, yeah, like crazy. Right? Like they lost their minds. But here's the deal. Okay? You are saying out loud, you're perfectly okay, I'm guessing, but I'm going to say on a $380,000 house, a $60,000 pool is probably not going to raise the value. 60 grand. It might raise it 30 grand. That's probably not wrong. I've been doing real estate a long time, but I might be wrong. But I doubt it raises it 60 grand. So you're going to consume some of this money with fun, with the kids, and some of it will actually be an asset that you would recoup when you sell the house, if you sell it before the pool goes bad someday, right?

Correct.

So there you go. I think you're fine to do that. You're paying cash, you're debt free. Except the house, it's a toy. You're paying cash for a toy. You're not damaging your finances. This is why we work. You live like no one else. So you can buy a pool, right? Correct.

And we've been talking about it for a few years, and we keep going back and forth, and I listen to your show every day. So I tell my wife, I'm like, I don't know. So I figured I would just call.

And be done talking about it. Now, have you got bids for this? Is this a real number? The 60 grand?

It's a real number.

Okay, good.

A couple of things that have nothing to do with your question. I'll just throw in the mix. All right. Number one, spend the extra money to get anything you can that causes this thing to maintenance itself. Any of the equipment. Okay. Spend a little more money on the equipment so you don't have to screw with it so much. Number two, pay someone else to screw with it. Okay.

Yeah.

Set up a pool service and have that in your monthly budget to come by. It will steal the joy of this thing because it turns into work. Does sound like I've done this. Had. I've got only one pool right now. Thank you, Jesus. But I'm old. I'm not putting in one for the grandkids. They can put in their own. And Rachel is by the. So, yeah, that's fine. But just set the thing up where it's for enjoyment. Like, I'll give you an example what we did in our lives one time that was similar. We've bought a lake house, a tiny little house, years ago, and then we tore it down, built a big house on it years later. But I said, when I went to the lake when I was a kid, we had to spend one of the three days we were there cutting my grandfather's yard, which was the lake, and hacking out the briars and everything else. So I was not going to go down there and work every weekend. That's not the purpose of having a lake house. You don't want to go to the pool and work. The purpose is, if you're going to go to all this trouble, enjoy it, because you paid somebody else to do the work.

So. I've never cut the grass once at the lake house in 20 something years. Not once. I don't even own a freaking lawnmower anymore. I cut enough grass. Start cutting grass when I was 18. I cut enough grass. I cut enough grass when I was twelve. By the time I was 18, God said I didn't have to do it anymore. So that's what I want for you. I want you to have freedom and love this experience and enjoy it. I think you're financially ready to go.

Oh, 100%. This has been a great show of telling people yes, Dave. Who says you're a big meanie?

Yeah, well, I'm even mean when I'm saying yes. No, I'm not.

That's fun.

Hey, the whole point of this is, if you do the stuff we talk about, if you live like no one else, later, you can live and give like no one else. It's why you do that part. Maggie's in Palm Springs. Hi, Maggie. What's up?

Hi, Dave and George. So, I need advice on a car situation. My husband has gone through two cars. One broke down and one was totaled in an accident in the last month. And we're also pregnant with our second baby.

Don't ride with him.

He sounds like the problem.

Well, the car was parked. We were sleeping.

Oh, my goodness.

An Uber driver fell asleep. Oh, that's my two year old. An Uber driver fell asleep and hit three cars.

Oh, my goodness.

That is wild.

Yeah, ours just happened to be one.

Okay, so you have insurance and that's going to buy another car?

Yes.

How much?

We're having another $9,000, and we only bought it for, I think, $4,500.

Good.

So we're doubling our investment.

That's awesome. So buy a $9,000 car. What's the question?

So the question is, we have also been debating getting a minivan.

So buy a $9,000 minivan.

Well, that's hard to find.

No, it's not hard to find one. What you've been looking at, but, yeah.

We're also in the middle of a high risk pregnancy, so I don't know if we should be waiting. The car situation.

Do you have any money?

Okay. Yeah. So we have about 52,000 saved.

And how much debt do you have?

No debt. We're in three B, sort of. We're trying to doing three B. Four and five.

So the 52,000 is for a house?

Yes.

So if you spend it on a van, you're not going to get a house?

Exactly.

I'd rather have a house.

Does that include your emergency fund?

Like, that's so far away already. We'll need a van before we need a house. Or can get a house.

Well, you have $9,000 from the insurance company. So when is the baby due, hon?

The baby is not due till the end of April, but with the high risk, probably three weeks.

Yeah. Let's wait.

Can you wait?

Yes.

Are you guys down to one car right now or what?

We're down to one car. The rental goes back on Wednesday.

Just wait. Just wait.

But with the high risk. He's leaving work in a week, so we could do one car for a week.

You'll be all right.

Or go rent a car for a week. I don't care. Just wait. You don't need to buy a car in the middle of all this. You got more important fish to fry right now. Yeah, there's a lot of drama, a lot of emotion, and rightly so. By the way, if I'm you guys, I'm spending 100% of my emotions and intellectual and financial energy on safe delivery of mom and baby. Vans are not on my list of things to worry about in your world right now. If I'm you.

Don't burn a brain calorie on it.

Yeah, I want all my brain calories spent on you and on baby Maggie. Focus completely on you guys. It's a stupid car. All those stupid cars will be there when you get home from the hospital. Fine.

Yeah. And now we have an extra $4,500 just in case.

Yeah, just hang out. And then when you get home, I'm going to recommend the closer to 9000 you can stay on the purchase, the faster you're going to get your home. Because every dollar you spend on this is not going towards a house down in value, which goes up in value and many vans don't. And you're thinking with your mom brain right now. Get home from the hospital. Let everything calm down. That puts this hour of the Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the prince of peace. Christ Jesus. Hey, 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. Plus, the app lets you browse by topic like debt, business, or selling your home. Get the content you want whenever and wherever you want to listen.

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