Life Happens. Are You Going To Be Ready for It?

Speaker 1 Hey guys, Dave Ramsey here. Me and Dr.
John Deloney are coming to a city near you on the Money and Relationships Tour. It's happening soon.
So don't wait.

Speaker 1 Get your tickets at ramseysolutions.com/slash tour.

Speaker 1 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.

Speaker 1 I'm Dave Ramsey, your host, Dr. John Deloney, PhD in counseling, host of the Dr.
John Deloney Show, number one best-selling author. He's my co-host today.
Jackson's with us in Vancouver. Hi, Jackson.

Speaker 1 Welcome to the Ramsey Show.

Speaker 2 Hi there. Thanks for having me on today.

Speaker 1 Sure, man. What's up?

Speaker 2 Well, you know,

Speaker 2 I'm a big fan of your guys' show, so I thought I'd give you a phone call.

Speaker 2 I've been making some pretty good money working up here. I work as a heavy-duty mechanic, and last year I made just shy of $200,000 a year.

Speaker 2 And I'm debt-free, but I don't have any sort of a financial plan. And

Speaker 2 I feel like I make too much money to not have some sort of a plan. And I don't want to feel like a fool who squanders a fortune.

Speaker 1 Good for you, very wise. How old are you?

Speaker 2 I'm 25 years old.

Speaker 1 Yeah, some of the guys you work with have never even had the thought that you've had. They spend their whole life working their butts off, and thank God it's Friday.

Speaker 1 Oh, God, it's Monday, and got nothing to show for it. So, you're very wise.
You got a huge head start at 25. Congratulations.
Just asking the question puts you in the top 5%, dude.

Speaker 2 So,

Speaker 2 yeah, that's kind of why I'm trying to ask the question because I set a pretty high standard for myself.

Speaker 1 Well, it's not that high, but it's.

Speaker 1 I mean, but you're way ahead of the game. You're way ahead of the game.
So,

Speaker 1 you know, what you're finding is this, and the way you pose the question is very wise. Dr.
Stephen Covey wrote a book that was vastly popular for about 30 years.

Speaker 1 It was on the New York Times and on the bestseller list for years and years and years called The Seven Habits of Highly Effective People.

Speaker 1 The number one habit of the seven was that highly effective people are proactive. They happen to things instead of it happening to them.
And so that's the position of your question.

Speaker 1 You are now going to happen to your money

Speaker 1 instead of it leaving and you having no idea where it went. And John Maxwell used to say that a budget is people telling their money what to do instead of wondering where it went.

Speaker 1 And so instead of saying ready, fire, aim,

Speaker 1 We're going to say ready, aim, fire.

Speaker 1 And so we're going to write it down before the month begins where every dollar is going to go using the Every Dollar app, the world's best budgeting app. It's free for you to download.

Speaker 1 And, you know, give every dollar an assignment, contract with yourself. If you have a spouse, contract with your spouse, that this is, we're in agreement.

Speaker 1 This is what we're going to do with the money. And then we're going to make the money do that.

Speaker 1 I'm often asked by reporters, what's the number one mistake people make with money? And the answer, they think it's going going to be credit cards or student loans or something.

Speaker 1 No, the answer is they're not intentional. And so we're going to flip this for you and say you're going to become very intentional.

Speaker 1 And then that's going to lead you to get out of debt, to save, to invest, to have the proper insurance in place.

Speaker 1 It's going to lead you to make smart decisions because you actually are paying attention

Speaker 1 instead of asleep at the wheel. So that's where we start.

Speaker 1 And so because right now you just throw the money in the account, and then when it's empty, you quit spending.

Speaker 2 Yeah, I mean for the most part I don't really like I get my paychecks and I pay my bills with it and then I don't really look at my account all that much.

Speaker 2 I just kind of know there's always a good chunk of change in there. And the kind of it usually fluctuates between 15 and 25,000 just kind of up and down from there.

Speaker 2 But it's not really going ahead from there because I'm kind of just living, you know. And I need to make some sort of a plan, I thought,'cause I'm I'm making way too much money to do that.
Again,

Speaker 1 that's better.

Speaker 1 You have the symptoms of someone who's getting ready to spend, you're saying the words of someone who's getting ready to change their life. You have a healthy disgust.

Speaker 1 You're like, I make too much money. I work too hard to be this broke.
I'm dissatisfied. And so you're ready to change.
That's perfect, man.

Speaker 3 Absolutely. Jackson, if you could close your eyes and imagine 30-year-old Jackson,

Speaker 3 What would your life look like? Would you have a house? Would you have your own business where you got two employees working for you?

Speaker 1 What would that look like?

Speaker 2 I guess if I were to close my eyes and dream about it, it'd probably be, yeah, a house and some sort of a business. I work as a mechanic, so some sort of a mobile mechanic truck.

Speaker 2 That's kind of the dream for me.

Speaker 3 So

Speaker 3 here's, most people have these things that float in and out of their heads.

Speaker 3 You, you're laying under a truck, turning wrenches, you got somebody's podcast on, and maybe your drive to work, your drive home, you've got this. Man, one day I want to have a thing.

Speaker 3 What's really cool is when somebody in your your position, because most people we talk to are, man,

Speaker 3 they've got a couple of years ahead of them to just get to zero, right? You're already, you're ahead of the curve.

Speaker 3 I would love for you to spend some time, and this sounds so cheesy, man, so just go with me,

Speaker 3 really picturing yourself at 30 within your own house. and what that house would look like and then get online and find out how much that house would cost.

Speaker 3 And then, as Dave says, you start being intentional about, man, going out with the boys on the weekend is fun and cool, but dude, I have a picture of the house.

Speaker 3 So I'm not going to blow $11,000 at various bars this year. That $11,000 is going to go into an account because I want to have X dollars.

Speaker 3 So when I'm 30, I'm walking into my house that I own and nobody else owns it.

Speaker 1 Yeah, what's it cost to buy and equip this truck?

Speaker 3 Yeah. So you want to have a real firm picture.

Speaker 1 You'll detail it out.

Speaker 1 You'll get a picture of it and put it on the refrigerator.

Speaker 3 Yeah, you'll get married and that picture is going to change because y'all are going to do one together. But

Speaker 1 that's where that intentionality, it gives you a map towards a thing you want to get to does that make sense yeah john's right when you uh dream in hd that's it it's clearly high definition where you can see the sweat coming out of the pores of the players you want to you want to dream in great detail and to as to what it's going to look like what it's going to feel like uh when you walk in that house how how you're how you're going to stand when you walk in there your chest is going to be out your shoulder is going to be back that's right you're going to be slumped over with your head down and your buddy's going to be coming over to your house to hang out not paying some bar owner to go into their facility, right?

Speaker 3 It's just a different thing. Or you and your wife are going to walk into this house when you're 30.

Speaker 1 Yeah, and it's a safe place for you or your kids, that kind of thing.

Speaker 3 Have you found, so something that has come up a few times over the last couple of years is people get this HD picture and they strangle it.

Speaker 3 And I'm starting to wonder if having that HD picture is step one, and then step two is having the discipline or the patience to hold that pretty loosely too.

Speaker 3 You get what I'm saying?

Speaker 1 Oh, yeah, because it's never going to be exactly what it is. It's never going to be exactly what it is.
Listen, you don't want the house that you think of as a 25-year-old.

Speaker 1 Well, because, you know, they don't make them like they used to. Thank God.
Right, exactly.

Speaker 1 You don't want the microwave from 1972. Yes, I don't want to.
You want the one from today. Right, right, right.
You don't want the toaster oven from 1972. You want the steam oven from today.

Speaker 1 You know, whatever it is. You don't want, you know, skylights used to be real popular, and then we found out they were pretty cheesy and they leak.
And so

Speaker 1 people don't want to, yeah, water beds were cool.

Speaker 3 I found out someone on our team still has a water bed.

Speaker 1 Don't, don't, don't say that.

Speaker 3 I'm not going to say their name.

Speaker 1 Don't, don't, don't shame, don't shame them from it. They should be ashamed of people.
Whoa.

Speaker 3 But, but, like, it's get this real clear picture and get a path towards it and then hold it pretty loosely.

Speaker 1 Yeah, and then change it. So, yeah, you know, so in other words, I, in, uh, I'll give you an example of that.
That's very cool.

Speaker 1 So, when I was 17, I saw the first time I saw that little two-seater Mercedes,

Speaker 1 that little hot hot rod, you know, and

Speaker 1 I saw one the other day. I'm glad I I never saw it.

Speaker 1 But, you know, what that meant was, though, I wanted a really cool, nice car. Right.
Because I'm a car guy. Yeah.
And today I drive a really nice, cool two-seater car, one of my cars.

Speaker 1 A couple of them. And so, you know, but that, but it wasn't, it's not that car.
It's not that car. It's not even a Mercedes.

Speaker 3 But it's the direction, right? Yeah.

Speaker 1 But that, yeah. So it changes.
Thank God. They don't make them like they used to.
Thank God.

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Speaker 1 John's in Charlotte, North Carolina. Hey, John, welcome to the Ramsey Show.

Speaker 2 Thank you for having me. I hope you're doing well.

Speaker 1 I am. How about you?

Speaker 2 I'm doing a bit better, been worse, but it's going in the right direction.

Speaker 1 Good. How can we help today?

Speaker 2 I was trying to get some advice.

Speaker 2 So I don't know if it'd be better to pay off

Speaker 2 the debt on my truck or pay down the negative equity on my wife's vehicle so that we can get her into a different vehicle.

Speaker 1 Okay. What do you owe on your truck?

Speaker 2 I owe $20,000 on my truck.

Speaker 1 And what's it worth?

Speaker 2 $27,000.

Speaker 1 Okay, cool. And what's your wife's car worth?

Speaker 1 $32,000. Okay.
And what do you owe on it?

Speaker 2 $57,000.

Speaker 1 How in the heck?

Speaker 2 Yeah.

Speaker 1 You must have rolled negative equity from the last bad deal into it.

Speaker 2 A couple of the last bad deals.

Speaker 1 Yeah,

Speaker 1 yeah. Yeah, we've been stacking them.
We stacked them on her car. Okay.
Stupid ones. It's layers of stupid.
Okay. Wow.
Ouch.

Speaker 2 We've not been very good stewards of what we've been given.

Speaker 1 What do you guys make? What's your household income?

Speaker 2 We've made about $140,000 last year.

Speaker 1 Okay. And what other debts have you got?

Speaker 2 So we owe $246,000 house.

Speaker 2 And then we owe $1,800 on my truck's bed cover. And then there's just the two vehicles.
That's it.

Speaker 1 Okay. Well, obviously the $1,800, you pay that off immediately.

Speaker 2 Okay. Yeah, I'm going to pay that off.

Speaker 1 In next month's next month's budget. Okay.
And um

Speaker 1 all right. And then let's see, we've got seventy-seven thousand dollars in car debt.

Speaker 1 Yes.

Speaker 3 Can you can you just sell your truck, take five thousand of that seven and go buy a um a five thousand dollar get around car?

Speaker 2 So actually I sold my other truck. This this is the better end of it.
I actually had a much more expensive truck and bought this truck to downgrade.

Speaker 3 Yeah, but you're not allowed to do that.

Speaker 2 That actually cleared up like $16,000.

Speaker 3 But you still owe $20,000 on it, right?

Speaker 1 Yes, that's where we're like.

Speaker 1 Here's a rule of thumb.

Speaker 1 77 out of 140.

Speaker 1 If

Speaker 1 I like the cars and I'm willing to fight to keep them, The rule of thumb that we use mathematically is this. Can I be debt-free, everything but the house, in two years without selling a car?

Speaker 1 And the answer to that question is, yes, you can.

Speaker 1 Okay?

Speaker 1 So you can pay off $77,000 making $140,000 in two years pretty easy. That's only $35,000, $38,000 a year.
Okay. So that's pretty doable.

Speaker 1 Matter of fact, you ought to do it in about 18 months and knock it out really, really, really, really, really fast.

Speaker 1 So then the question you asked was, which one do we pay off first? You pay off your truck first because it's the smaller of the two debts. If you're trying to get rid of her car,

Speaker 1 you're $20,000 versus $20,000 then. Yeah, $25,000 versus $20,000.

Speaker 1 Are you sure your 32 valuation is correct?

Speaker 2 It is. We went to six different dealerships.

Speaker 1 That's what they offered you?

Speaker 1 That's what they offered you?

Speaker 2 The best one offered us 32.

Speaker 1 Okay,

Speaker 1 that's not a retail.

Speaker 1 That's a wholesale trade-in value. Yes, sir.
That means you could private sell that for $37,000.

Speaker 2 Probably, yes.

Speaker 1 Well, that's the number. I mean, no.
Dealers don't pay retail. They buy it at trade-in because they're going to sell it at retail.
So

Speaker 1 it doesn't matter, is the answer to your question, which one you do. You've got to do both of them in the next 18 months.
And so $57,000. I'm sorry.

Speaker 1 Yeah, $77,000. Let's call it $80,000 in a year and a half.
Okay.

Speaker 1 And so that's what I want to do. And then I'm just going to divide that out and I'm going to get with it.
And so that's going to sound like $4,000, $5,000 a month at these things.

Speaker 2 Well, the thing is, we actually just came into some pretty good money.

Speaker 1 Well, bury the lead.

Speaker 3 The lead with that one, homie. What did you come into?

Speaker 1 I'm sorry.

Speaker 2 Well, so when I sold my truck, I got all my warranties back from the other dealerships. We got about $6,000 from them.
And then my wife started a new job, and she got a sign-on bonus of $12,000.

Speaker 2 She got half of it just now.

Speaker 1 So we have

Speaker 1 roughly $30 in the bank right now. Pay off your truck.

Speaker 3 You got $30,000 in the bank right now?

Speaker 1 Yes. Okay, pay off your pay.
Pay off what my wife is paid. Yeah, pay off your truck today.
Yeah. And pay off the $1,800.
And then let's start attacking her car with everything in the budget.

Speaker 2 Okay. Yeah.

Speaker 1 And you take your take your savings all the way down to $1,000, which is your baby step one.

Speaker 1 Baby step two is pay off all debts, smallest to largest, except the house, but you only have one debt left after tomorrow. So we're going to pay off your stuff, and then you're stuck with her car.

Speaker 1 And here's what I want you to do, okay? Here's what I do in these situations. And so when I do stuff like this, and

Speaker 1 every time you write a huge check towards $57,000 on her car, and you need to do this in well under a year, okay? So you need to be putting $5,000 a month on her car

Speaker 1 because you don't have your car payment anymore after tomorrow. Every time you send a check to $5,000 on that, I want you to cuss yourself under your breath.

Speaker 3 I was going to say hit yourself in the face, but Dave's is probably safer.

Speaker 1 Because what I do is every time, because every time I used to write on a check in the four column, stupid tax.

Speaker 1 Yeah. Because I'm paying stupid tax right here because I did a stupid thing.
And by the time you finish paying off this car, you'll be so pissed off, you will never do this again.

Speaker 1 That's what I want. That's what I, that's how I do it to myself.

Speaker 1 It's not destroying my identity, and I'm not shaming myself or condemning myself. It's, I want to learn this lesson so it never happens again.

Speaker 1 So the next time a car dealer walks towards you, you know, he could get hurt. I mean, it's just like, we're not, get away from me because you don't do well on car lots, I can tell.

Speaker 3 Yes, you've gotten gotten beat up.

Speaker 3 Dave, I actually love that. I love that.
And because you'll do it with a smile smile on your face, but

Speaker 3 you are taking a moment to sound woo-woo. You are taking a mindful moment to absorb the consequence of you not making good choices.
And that's important. It keeps you from doing it again.
Exactly.

Speaker 1 We're trying to break the cycle.

Speaker 1 Let's put some new grooves in the brain patterns

Speaker 1 and the neuroscience.

Speaker 3 You've got $20,000 of dead money. That should hurt for four months when you write $5,000 checks.

Speaker 1 It's a stack of three bad car deals stacked on top of each other. So, yeah, enjoy that ride out because it's going to be your last one.
In other words, that's what I want you to do. And yeah, just,

Speaker 1 and I'm not picking on you.

Speaker 1 I have done dumber things than you've done. I'm just saying, learn the lesson.

Speaker 1 If you're going to get the scars, if you're going to get the bruises, at least learn the lesson

Speaker 1 permanently. And so,

Speaker 1 you know, we used to, somebody would call and go, you know, I've messed up my credit. I was always say, good.
Yep. Keeps you from getting more.
Yeah.

Speaker 1 Now, and you're only 23. You can learn your, you've learned, You've got the whole rest of your life to live without worrying about that.

Speaker 1 One less thing, as Forrest Gump used to say. Dave,

Speaker 3 can we just say this out loud? Rolling negative equity is in the, like, I can't think of a, rolling negative equity on a depreciating asset.

Speaker 3 I can't think of a dumber way to set money on fire in your house.

Speaker 1 Well, and that's not picking on John.

Speaker 1 It's all of us that have done that. Yeah, yeah, yeah.

Speaker 3 Yeah, not just poking on him, but the thought that that's an option. Yeah.

Speaker 1 It's just madhacking. And what it is, it's just stacking stupid.
Yeah. I mean, we got stacks of stupid here, three deep.

Speaker 1 And yeah, and here's the thing overall: the whole thing of car payments falls in that category.

Speaker 1 It's the largest item in America that we buy that goes down in value.

Speaker 1 The only thing we buy that's larger is a home. Yeah.

Speaker 1 I mean, 98% of people anyway, right? And we buy a $40,000 to $50,000 car and it loses 60 to 70% of its value in the first four years.

Speaker 1 And so you're setting money on fire when you buy a new car to start with. That's if you pay cash for it.
But let's go ahead and finance it so that we're upside down while it's burning to the ground.

Speaker 1 And, you know, and let's just make sure we pay some interest. Or worse than that, let's lease it, the most expensive way to possibly operate a vehicle.

Speaker 3 Well, then the brakes squeak and the dealer says, oh, you should, I can just put you in a new one. Yeah.
If you just give me this one, we'll roll it. Yeah, man.
It's getting a mess.

Speaker 1 I've always got a new to have a new car. Except for those months when I was driving that car and it was used.
But yeah.

Speaker 1 Golly. The things we say.
Yeah. Don't buy brand new cars unless you have a net worth of a million dollars or more.
And don't buy cars unless you can pay cash for them.

Speaker 1 And they should not, all the things that you own with motors and wheels should not total more than half your annual income. If you have too much tied up in things going the wrong way.

Speaker 1 You're going to be broke people your whole life.

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Speaker 1 Drew is in Tupelo, Mississippi. Hi, Drew.
How are you?

Speaker 2 Doing well, Dave. How are you?

Speaker 1 Better than I deserve. What's up?

Speaker 2 So my wife and I were wondering if I should stop investing 10% into my 401k and continue to save in order to get close to the 20% down payment on a house.

Speaker 1 Okay. We call that baby step 3B.
3 is your emergency fund, fully funded. We're not touching that.
Four is putting 15%, baby step four, of your income into retirement. You're currently putting in 10.

Speaker 1 So sometimes people before they start baby step four, putting 15% away,

Speaker 1 don't start it for a short period of time and use that cash like you're talking about to build up the down payment. Or they put in less.

Speaker 1 in their 401k and use the difference temporarily for one or two years to save up the down payment. So the answer to your question is yes.

Speaker 1 But as soon as you get that down payment in place, baby step four kicks in and it's 15 percent of your household income going into retirement at that point

Speaker 2 okay

Speaker 2 um she's currently in vet school uh so we have the we're the only i'm the only uh line of income right now i'm making 83 000 a year uh and we've got uh 70 000 in savings 8 800 and 401k

Speaker 2 And I've got 35K set aside for emergency funds. So we were looking in our area, the houses we were going to buy were around $300,000.

Speaker 2 And I was basing that off of being able to put down 20%, which would be 60K.

Speaker 2 And once she starts her job, we should be close to $200,000.

Speaker 1 Do you think that's reasonable? Yeah, because you'll knock that little bitty debt out real fast and have a paid-for house.

Speaker 1 Okay. Once she starts, right? When's she graduate?

Speaker 2 Next May. So we'll be looking to buy

Speaker 1 as soon as she graduates.

Speaker 1 What's her her practice plan? Is she going to join a local practice or does she know?

Speaker 2 She's going to work for between five to eight years and then open up her own business and become a business owner.

Speaker 1 Yeah, but has she got a place to do that?

Speaker 2 Yes, yes. She's had job offers of anywhere from $100,000 to $120,000 with

Speaker 2 $75,000 signing bonus.

Speaker 1 That's pretty standard for Vets, yeah. And she'll be making $200 in five years.

Speaker 1 Absolutely. Yeah, I mean, that's a great field.
So good for her. Good for you.
Well done.

Speaker 1 Yeah, and so if you're buying a $300,000 house, you're putting down $60,000, that's $240,000, and then you start making $200,000, and that's your only debt.

Speaker 1 Man, you're going to knock that out pretty quick, agreed.

Speaker 2 Yeah, I hope so. That's the plan.
Yeah.

Speaker 1 And then, you know, save up and pay cash and move up in-house later.

Speaker 1 Once you're making $300,000 or $400K in the household and you've got no debt on that house, you can sell that house for $500,000 by then, put some money with it and buy a million-dollar house.

Speaker 1 You'll be able to do that. That's going to be your future out there 10 years.

Speaker 3 Yeah, if you pay that house off real fast, Drew, when she gets done, the biggest thing I see when people graduate with their big graduate degrees, whether it's an MD or a nurse practitioner or a vet, is their colleagues all drive really fancy cars and they'll have huge houses that they go to at Christmas.

Speaker 3 And you start thinking, am I doing something wrong? We need to get a different house or a bigger house.

Speaker 3 If y'all can stay in that $300,000 house and pay it off in a year and a half, and she starts socking away that house payment for the practice, the purchase of a practice in eight years or her own metal building that she's going to turn into a shop, man, then y'all win.

Speaker 3 What I see vets do is they go and they get a big house and then they borrow a million dollars to buy into a practice or to start their own and then they are they're just up to their eyes and ears in debt.

Speaker 1 And so, man, you guys have a chance to buy $95,000 dually because they have a large animal practice. Exactly.
Yeah, yeah.

Speaker 3 So you can get out over your skis on this or dude, you can look up in 10 years, have a paid for, nice house, a paid for practice, and you are just in gravy train.

Speaker 1 Yeah, because you don't care what anybody else thinks. That's right.

Speaker 1 Yeah, you're on track, dude. You're really thinking this through.
You've done a great job, by the way.

Speaker 1 You're way ahead of the curve already, and then your questions are excellent.

Speaker 3 And cheers to

Speaker 3 cash flow and a vet degree, man.

Speaker 1 That puts you in the rare air, my brother. That's awesome.
Ding, ding, ding, ding, ding. Sherry's in Atlanta.
Hi, Sherry. Welcome to the Ramsey Show.
Hi.

Speaker 2 Hi. I had a question.
My husband and I are both getting closer to retirement. I'm 62.
He's 67. We have two small

Speaker 2 insurance policies I was thinking about cashing in. Mine is a universal life insurance policy.

Speaker 2 The death benefit is $66,000. And if I cashed it in, it's like $15,000.
His is a whole life policy.

Speaker 2 If he cashes it in, it's like $10,000, and the death benefit is $14,000. They both have very low monthly premiums.
Mine's like $25 a month, and his is $14 a month.

Speaker 1 Yeah, because you don't have any insurance.

Speaker 1 So that's why you don't have any premiums.

Speaker 1 What's your nest egg?

Speaker 2 Well, we got a late start, or he did.

Speaker 2 His plan was the rapture plan. I'm the nerd, and I've saved about $800,000.

Speaker 1 Oh, he was going to leave you behind.

Speaker 1 Okay. So you were smart.
You got $800,000 saved. Good job.

Speaker 3 He married Welsh.

Speaker 1 Is your house paid off?

Speaker 2 We owe about $15,000.

Speaker 1 $16,000? You got that in check. $16,000.

Speaker 2 Yes, we do. I have about $60,000 in savings.

Speaker 1 Yeah, pay it today.

Speaker 1 Okay. And do you need life insurance if he dies?

Speaker 2 I've got just term life insurance through

Speaker 1 your house is worth what? $100,000. Your house is worth what?

Speaker 2 About $550,000.

Speaker 1 Okay, and you've got a million dollars saved almost. Okay, so

Speaker 1 you've got a million and a half dollar net worth. You're 61 years old.
He's 67. If he dies today, can you make it without the $14,000 policy? Yes.

Speaker 3 Sorry, you've crushed it, man.

Speaker 1 You follow me? Excellent job. Okay, so that means you are self-insured and you can cancel this policy.
You've got the one through work that's a little extra. Is that on you or him?

Speaker 2 The 600 through work is me. He's got one

Speaker 2 that

Speaker 2 is about $250, but his expires when he turns 70. Mine expires when I quit work.

Speaker 1 Good. Okay.
Either way, if they expire, you're fine. Okay.
But you don't cancel them.

Speaker 1 Well, you don't need to cancel them. They're free,

Speaker 1 Right?

Speaker 1 The ones that work?

Speaker 2 No, the one I paid a supplemental one. It's like, I don't know, $125 a month.

Speaker 1 It's just some term insurance, some ART at work. Okay.
Yeah. Yes, you have enough insurance and enough assets to care for you without these two policies.
Is that a true statement?

Speaker 1 Yes.

Speaker 1 These two little policies.

Speaker 1 Oh, the little policies. The little ones you called me about.
if they disappear if you don't get that money you're just fine you're not even going to notice

Speaker 2 yeah

Speaker 1 that was that didn't sound convincing for my kids like 66 your kids have eight hundred thousand dollars and a five hundred half a million dollar house you don't you don't need sixty six thousand from a rip off whole life company no i cancel both of these immediately because you are easily under control without them

Speaker 1 okay and pay off the house today anyway

Speaker 2 and then if I paid off the house, do you think the monthly house payment that we're making, should I just go ahead and take that amount every month and start piling it in my 401k?

Speaker 1 Why not? Wouldn't hurt a thing.

Speaker 3 Sherry, will you make me a promise?

Speaker 2 Okay.

Speaker 3 My mom's a little bit older than you, but I'm going to pretend you're my mom for a second. Will you do me a favor?

Speaker 3 Sure.

Speaker 3 Will you pay your house off today and cash out both of those policies and take you and that rapture husband of yours out on a vacation or at least a real fancy, fancy dinner?

Speaker 2 Well, we're planning to do

Speaker 2 our last big whoopty before we retire or he retires here. We're doing like an Iceland, Norway

Speaker 1 coming up in May.

Speaker 1 That's good.

Speaker 3 That makes me happy for you.

Speaker 1 While you're there, buy a ridiculous bottle of wine. Yes.
Yeah. You're millionaires, Kiddo.
You did it.

Speaker 3 You've been white knuckling this thing for a year.

Speaker 1 You've been holding it so tight. And you're sweating over a $14,000 policy.
Cancel that.

Speaker 1 Pay off your house today.

Speaker 1 Wow, that's so cool. Good for you guys.
You're heroes. And I love America.

Speaker 5 For free tools and resources to help you reach your home goals, go to ramseysolutions.com slash real estate or click the link in the show notes.

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Speaker 1 Glenn is with us in Moore, Oklahoma. He is one of the many teachers across America teaching Ramsey's foundations and personal finance to high schoolers.

Speaker 1 So we wanted to have him on and talk about that a minute. Hey, Glenn, thanks for doing that, man.

Speaker 2 Hey, you're welcome.

Speaker 2 I enjoy what I do, and it's all because of you.

Speaker 1 Well, no, I mean, you're the one in the classroom dealing with all this. It's pretty cool.
So you're in Moore, Oklahoma. Is it Moore High School then?

Speaker 2 Yes, it is. It's Moore High School.

Speaker 1 Where is Moore in Oklahoma?

Speaker 2 Right south of Oklahoma City, by about 18, 20 miles.

Speaker 1 Okay.

Speaker 2 Or literally a part of Oklahoma City.

Speaker 1 I got you. Okay.
Well, we were a little bit east of there in Ada the other day for a funeral. Okay.

Speaker 2 Oh, wow.

Speaker 1 That's pretty close. Yeah.

Speaker 1 Right in the neighborhood there. Yeah.
So

Speaker 1 how many students are enrolled in the high school?

Speaker 2 2,600.

Speaker 1 Oh, it's a big school. All right, cool.
How many in your class?

Speaker 2 I teach

Speaker 2 two sessions of

Speaker 2 your class right now, and then I teach three other classes. But right now I have 25 a class, so I got 50 kids in total with doing the foundations class.

Speaker 1 Cool. Thank you for doing that, man.
We really appreciate it. How long have you been doing that?

Speaker 2 I've been teaching financial literacy for 13 years and with yours the last three years.

Speaker 1 Okay.

Speaker 2 And I won't teach in any other way beside your way.

Speaker 1 Wow. Well, thank you.
Thank you. So how much do the kids challenge you like, hey, Mr.
So-and-so, do you really do this?

Speaker 2 They ask me all the time, and I always tell them, I say, well, I was just like Dave.

Speaker 2 I was once, you know, made my way, then I had to file bankruptcy, and I learned the hard way, and then come back out, and then I can be that person that can give the real truth and the honest answers to the kids and that's the only way I believe teaching.

Speaker 1 Yeah.

Speaker 1 And you're teaching the thing we always hear and I bet you've heard it as well is that the kids like the class because it's something they can actually realize they're going to use.

Speaker 1 The Pythagorean theorem, maybe not, but definitely knowing how to balance a checkbook for sure.

Speaker 2 100%. And that's

Speaker 2 kind of what I tell them. I said it's the most relevant class they'll ever take in high school because every day they'll deal with money.

Speaker 3 Glenn, how much do you have to deal with parents who challenge you on a credit card deal or a car lease or something like that?

Speaker 2 I don't have any of any challenges like that, but I do challenge my students with that.

Speaker 2 And, you know, because I ask for insight from the kids and when we talk and stuff like that, then

Speaker 2 there's not there's there's there's only when we do a inter-teacher conference that parents come in and then when we sit down we start talking that they find out exactly what we're talking about, because I open up everything to them.

Speaker 2 I show them everything that we do in the class, and they're like, oh, my gosh, I wish we would have had this when we were in high school. And I said, exactly.

Speaker 3 What do you would, like, so whenever I see politicians or even me and my team, we get in a room and we're talking about what, quote unquote, these kids these days are dealing with.

Speaker 3 You're in there every day. When it comes to money, what are these high school kids like? Obviously, they don't know about credit scores.
They don't know about debt.

Speaker 3 They don't know about that kind of stuff. But what do you see them really worrying about?

Speaker 2 Food and shelter. I mean, that's the biggest things.
I mean, I try to talk to them about cars, but, you know, with a school of 2,600 kids, we are

Speaker 2 pretty large school, and a lot of kids just worry about having a job to help their families out get by.

Speaker 2 They bring to me their employers, you know, they'll try to bring me a W-4 and tax information to help them fill it out, you know, to try to get them a resume, you know, built, anything like that.

Speaker 3 That's amazing. And

Speaker 3 Glenn and Dave, yeah, we continue to hear that, that there's all of this rhetoric about all this other stuff going on in the average American and their high school kids, who, by the way, if you're a parent of high schoolers, they're absorbing everything is, hey, how are we going to buy eggs?

Speaker 3 Right.

Speaker 3 How are we going to buy groceries? And so, man, I'm so grateful that you're there walking alongside them. That's amazing.

Speaker 1 That's beautiful, man. Thank you so much for doing this.
We really appreciate it. And

Speaker 1 we've got a sponsor, First United Bank and Trust, that apparently bought the curriculum and donated it to the school, right?

Speaker 2 Yes, sir.

Speaker 2 They are very honored to have that done for us.

Speaker 1 Yeah, that makes a big difference as well, because we've got lots of local businesses all around the U.S. that step up and buy the

Speaker 1 Foundations and Personal Finance for the local school. And that helps a teacher like Glenn be able to teach this to 100 students a year.

Speaker 1 Three years, so you've got some graduates out there in the wild that have been through our stuff. You hear back from any of them?

Speaker 2 Yes. And a lot of them come back.
And, you know,

Speaker 2 the first thing I always talk about,

Speaker 2 this course is income.

Speaker 2 But I talk about the investing aspect that they have a savings account to open up a mutual fund, you know, like you talk about.

Speaker 2 And then kids take their take their money out of a savings account because it's drawing nothing and you're just wasting it. And kids will come back and be like, hey, Mr.

Speaker 2 Pratt, I'm so happy that I had your class, that I invested this money, and I'm, you know, not having to pay for, things outside right now because I've got grants and scholarships that you talked about, the easy way to pay for school, Oklahoma Promise, they went through all the

Speaker 2 things that we try to cover in class and get across to them and they come back. And I'm just amazed with

Speaker 2 the knowledge that some of these kids come back with and the

Speaker 2 blessing basically coming back. I mean, because that's what it is to me, is it's a blessing that I'm able to teach this and get this out to the students.

Speaker 2 And then they, in turn, come back and let me know that they're being successful. Wow.

Speaker 1 I'm proud of you, man. You're a hero.

Speaker 1 I remember high school distinctly that there were only two categories of teachers, those that mailed it in and everybody couldn't stand them, and the teachers that really gave a crap and were all up in the kids' lives and helping us and helping us move to the next level.

Speaker 1 And you're that guy. You're the one that they'll remember the rest of their lives.
I can name them still. And it was 45 years ago.
I can name you exactly who was there that made a difference.

Speaker 1 And I strangely have forgotten the other ones.

Speaker 1 But yeah, the ones like you,

Speaker 1 they're embedded into our psyche because that's the power of being a teacher for an adolescent. Absolutely fabulous.
Thank you, sir. We appreciate you so much.

Speaker 1 For any of you teachers listening, you can enter the Ramsey Teacher Appreciation Giveaway.

Speaker 1 It's free to enter. No purchases necessary.
One teacher is going to win a $5,000 vacation because we love teachers. And two more teachers are going to win a $3,000 vacation each.

Speaker 1 Go to ramseysolutions.com slash teacher to enter. April is National Financial Literacy Month, and we celebrate that by celebrating teachers and highlighting men and women like Glenn in the classroom.

Speaker 1 And just to stop and say, hey, we appreciate you. We appreciate the fact that our stuff's being taught, and there's no other way it would get taught.

Speaker 1 Changing gears, let's face it, our money and relationships in America are out of whack. Dr.
John Deloney to my right and I will be in Six Cities coming up, starting in about two weeks.

Speaker 1 We're going to be in Louisville, Kentucky, April the 21st, doing live events. And you're going to pick the subjects in the audience before we get up there.

Speaker 1 In the 30 minutes before the curtain goes up, we're going to put a list of stuff out that John can talk, I can talk, or we can talk together.

Speaker 1 You're going to pick them, and then we're going to do an ad hoc. We're going to throw it together and do a show that night.
So none of these shows will be alike.

Speaker 1 It's going to be very fun, very interesting. Louisville, Kentucky, April 21, Durham, April 23, Atlanta, April 25.
That's Monday, Wednesday, and Friday.

Speaker 1 Two weeks later, Monday, Wednesday, and Friday is Phoenix, May 5. Fort Worth, May 7.
Kansas City, May 9. You can get your tickets.
They're not sold out, but they're getting close.

Speaker 1 Go to ramseysolutions.com slash tour or click the show notes on YouTube or podcast. Make sure you line up.
John, that's going to be really fun.

Speaker 3 It's going to be wild in the streets, man. That last planning meeting we had,

Speaker 3 I left pretty excited. It's going to be a fun show.

Speaker 1 Well, you and I both like making stuff up on the fly,

Speaker 1 as opposed to following the rules. But, yeah,

Speaker 1 that's what we're going to do. It's not, I mean, it's not made up, but I'm saying we're not coming in and talking at you.
We're saying, what do you want to learn about tonight?

Speaker 1 That's right. And whatever you want to learn about tonight, we'll teach you.
And it's going to be very interactive and a

Speaker 1 high experience. process that's different than maybe you've ever been to.
So I'm looking forward to it. I think it's going to be a lot of fun.
So make sure you get your tickets at ramseysolutions.com.

Speaker 1 Get signed up while you can.

Speaker 3 This show is sponsored by BetterHelp. All right, you've heard me say it a thousand times, and I'm going to keep saying it.
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Speaker 1 Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people

Speaker 1 build build wealth,

Speaker 1 do work that they love,

Speaker 1 and create actual amazing relationships. Dr.
John Deloney, Ramsey personality, PhD in counseling, host of the Dr. John Deloney Show, very popular show on the Ramsey Networks.

Speaker 1 He's my co-host today as we answer your questions about your life and your money. The phone number is 888-825-5225.

Speaker 1 Jessica is in Richmond, Virginia. Hi, Jessica.
How are you?

Speaker 2 Hi, Dave. Hi, John.
Thank you so much for taking my call.

Speaker 1 Our pleasure. What's up?

Speaker 2 I just found out recently that I am scheduled to go to court in May because Bank of America wants to garnish my paycheck, and I just don't know what to do.

Speaker 2 I can't afford to have 25% of my paycheck garnished every two weeks. I don't know if there's anything I can do to prevent it, or I don't know where to go from here.

Speaker 1 Okay. What do you owe Bank of America?

Speaker 2 My ex-husband ran up a credit card years ago.

Speaker 2 It's about $10,000, a little less than $10,000.

Speaker 1 Okay. And how long has it been since you paid them?

Speaker 2 Oh, years, years.

Speaker 1 How many years?

Speaker 2 Like almost,

Speaker 2 it's like eight or nine years old.

Speaker 1 Good.

Speaker 1 That's wonderful. Okay.

Speaker 1 And so this has your name on the the credit card and your ex-husband's name on the credit card?

Speaker 2 His name is not on the credit card. The credit card is only in my name.

Speaker 1 The divorce decree require he pay any of it?

Speaker 2 No, we um

Speaker 2 everybody just got their own debt and their own name in the divorce.

Speaker 1 Okay, except that his debt has got your name on it, but other than that, yeah, okay. Exactly, yeah.
What do you make?

Speaker 2 Um, $1,700 every two weeks to take home.

Speaker 1 Okay.

Speaker 1 And how many kids have you got?

Speaker 2 Three.

Speaker 1 What ages?

Speaker 2 Two are older. One is elementary school age.

Speaker 1 Older as in over 20 and they're not your problem?

Speaker 1 Correct. Okay.

Speaker 1 Well,

Speaker 2 technically, yes.

Speaker 1 No, technically, they're not your problem.

Speaker 2 One still lives at home, but he's over 20.

Speaker 1 Okay.

Speaker 1 And he needs a job and needs to be buying his own stuff. Yeah, okay.
So

Speaker 1 $1,700.

Speaker 1 What do you do for a living?

Speaker 2 Broad description of social work.

Speaker 1 Okay. All right.

Speaker 1 And I'm one elementary school. You got any family in the area?

Speaker 2 None to speak of, no, sir.

Speaker 1 I'm guessing you have no money.

Speaker 2 Just the $1,000 emergency fund.

Speaker 1 Okay. How much other debt do you have?

Speaker 2 I owe my dad about $6,000

Speaker 2 for a car. I have about $2,500 in collections and medical debt and about four separate student loans that total about

Speaker 2 $26,000.

Speaker 1 When did you get divorced?

Speaker 2 The divorce was finalized

Speaker 2 a few years ago.

Speaker 2 I don't even remember, like 2022 or something like that.

Speaker 1 All right.

Speaker 1 Now, so they have sued you and asked you to come to court. Has there already been a court date prior to this one?

Speaker 2 It was years ago. It was when it

Speaker 2 it was years ago. I don't remember when it was, but it was a really long time ago.

Speaker 2 I wasn't able to go to court that time because I was in the middle of a foreclosure.

Speaker 1 So

Speaker 1 did they take a judgment lien at that time?

Speaker 2 That's my understanding, but it never showed up on my credit report, so I don't know.

Speaker 1 Okay.

Speaker 2 I assume, yes, because now I'm being garnished.

Speaker 1 Well, no, you're not being garnished yet. There's a hearing for you to be garnished.
Maybe.

Speaker 1 There may be a hearing to renew the judgment first.

Speaker 1 Okay, so the judgment has to be complete, and then they execute on the judgment by collecting any assets, and one of the ways they execute is a garnishment. Okay,

Speaker 1 and so I'm not sure exactly what your court date is because you're not.

Speaker 1 It sounds like though that they're trying to reinvigorate an ancient judgment lien in order to execute on it and file a garnishment.

Speaker 1 It sounds like they're going to do that, but they're not garnishing. It's not automatic that this is going to happen.
Okay. So first thing I want to do is I want to really dig in.

Speaker 1 Call the courthouse and ask to talk to the judge's assistant or the judge's paralegal and find out exactly what the status of this account is. And do you have a judgment?

Speaker 1 And ask her how the procedure works there, her or him.

Speaker 1 One of the clerks in the judge's office will walk you through what's going on here. And you've got to become an expert in 20 minutes on a tiny couple of legal maneuvers, okay?

Speaker 1 And then ask them, I've got kids at home, I'm broke, I'm a single mom. What can I do about this garnishment to keep it from happening if they're actually going to do that?

Speaker 1 Because Bank of America said it's going to happen does not mean it's going to happen because you can tell a Bank of America credit card collector is lying if their mouth is moving.

Speaker 1 Okay?

Speaker 1 They are scum.

Speaker 1 They lie, cheat, and steal every day. That's why no one should ever do business with that bank.
They're filthy. All right.

Speaker 1 And so I don't know based on what they did to scare you, because you're scared. We can hear it in your voice.
They accomplished that goal, but I'm not sure that they told you the truth.

Speaker 1 As a matter of fact, I'm fairly sure they didn't. Okay.
Now. I mean,

Speaker 1 I'm sorry. Go ahead.
Go ahead. I don't mean announcement.
You're fine.

Speaker 2 I was just going to say, it's just

Speaker 2 my

Speaker 2 ex-husband was extremely abusive, and now just having this brought up again is just

Speaker 1 bringing it all back. It's emotional.
I don't blame you. I just want it to go away.
I want it to go away too, but it's not going to until we deal with it.

Speaker 1 It's not going to go away by ignoring it. We found that out over the last five years.

Speaker 3 And Jessica, your divorce was finalized two years ago. Can I give you a promise?

Speaker 2 Okay.

Speaker 3 Avoiding this again

Speaker 3 just reinforces that sense of powerlessness that you feel.

Speaker 3 And we live in a culture that says just avoid anything uncomfortable, and it's burying people. And so here's my promise to you.

Speaker 3 If you'll find a friend, find a coworker, take them to coffee and say, I've never told anybody this. I got this judgment.

Speaker 3 This horrible thing when you walk alongside me, A, you're going to give somebody the greatest gift another person can give somebody, which is the question, can you help me?

Speaker 1 Yeah, and do the same thing with your pastor at your church. Yep.
You need to go tell them what's going on and see if they'll help you. Now, all of that to say,

Speaker 1 let's go to the end of it. Here's what we're going to do.
They will take, because the probability of them collecting this is close to zero.

Speaker 1 98% of the people facing what you're facing file bankruptcy and they get zero. You don't need to file bankruptcy over this.

Speaker 1 You do need to scrape together $1,500 or $2,000 right quick, selling some stuff, take an extra job or three.

Speaker 3 Tell your 20-year-old to go get a job.

Speaker 1 Tell your 20-year-old to get three jobs. We got to scrape together.
Maybe the church chip in and help you a little bit.

Speaker 1 We need to scrape together $1,500 to $2,000 and offer that to them as a lump sum settlement. They will say, glory, hallelujah, I got some money of this woman.

Speaker 1 I didn't think I was ever going to get a dime. And they will take that as a settlement in full and the whole thing goes away.
That's how you settle this, and it goes away.

Speaker 1 The only other thing you can do to stop a garnishment is file bankruptcy, and I wouldn't do that. I would fight them tooth and nail.
I'd go down there, get in the judge's face.

Speaker 1 I'm going to learn all about this. I'm going to make this my new hobby, and I'm going to put this abusive crap in the rearview mirror permanently.

Speaker 1 So, the good news is you haven't paid on it in a long time, and they will settle for pennies on the dollar. 15 to 20 percent will settle this on a four-year-old debt.

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Speaker 8 All right, I want to shout out our teachers for a minute. You guys give so much to our kids every day.
And often those days stretch into your nights and weekends. Seriously, you deserve a break.

Speaker 8 And by that, I mean a dream vacation. All you have to do is enter the Ramsey Teacher Appreciation Giveaway sponsored by Ramsey Education.

Speaker 8 There's no purchase needed to win, and you'll get bonus entries if you refer your teacher friends. Just go to ramseysolutions.com/slash teacher.
That's ramseysolutions.com/slash teacher.

Speaker 1 Ramsey Show question of the day is brought to you by YReFi.

Speaker 1 Before I do that, I'm going to stop. I meant to do something coming back from that.

Speaker 1 Okay, so some people listening to that last call are like,

Speaker 1 Bank of America will settle for 15 cents on the dollar on a four-year-old debt. The answer is absolutely.
And I'll give you the proof.

Speaker 1 A couple of years ago, I think about three years ago, four years ago now, we decided to do something weird at Ramsey as part of our Christmas celebration for our team.

Speaker 1 And I've worked with and negotiated old bad debt.

Speaker 1 on the behalf of clients at anywhere from 5 or 10 or 20 or 30 cents on the dollar for 30 years to get people out of debt that were broke like that poor lady and scared like that poor lady.

Speaker 1 So I knew that market was there and we contacted.

Speaker 1 You can buy old, bad debt in bulk. And there are companies that buy old, bad credit card debt and then try to collect it.

Speaker 1 And you buy it at pennies on the dollar and try to collect it at dimes on the dollar. And

Speaker 1 you make the spread if that's the business, if they're a debt buyer, that's what they do. So we bought $10 million

Speaker 1 worth of bad credit card, repossession, and medical debt

Speaker 1 for $259,000.

Speaker 1 That's $0.2.5

Speaker 1 on the dollar.

Speaker 1 So we paid two pennies, three pennies on the dollar for $10 million worth of debt. There were 8,000 accounts.
And we did it to forgive it. It was part of our Christmas deal.

Speaker 1 So we've got 1,000 team members. We gave each of them eight people to call and say, you know, that debt, it's forgiven in Jesus' name.
We bought it and we're forgiving it.

Speaker 1 In Jesus' name, Merry Christmas. And that was our Christmas fund.
That was awesome. And we had so much fun with it.

Speaker 1 People were crying. They thought we were con artists.
They didn't believe us. It was so fun.

Speaker 1 But, you know, the point is, not that we're wonderful people, although that was a very fun thing to do, but that's not the point. The point is we bought that for two and a half cents on the dollar.

Speaker 1 And that was, you know, many times a car car that was repoed four years ago, three years ago, they don't think they're going to collect it. That's the point.

Speaker 1 And so when someone gets that far under, very seldom does the bank ever get their money.

Speaker 1 If they do corner someone like they did her, put them in court, they typically file bankruptcy and they get zero.

Speaker 1 So

Speaker 1 that's what normally happens. So banks are aware of those probabilities.
They know the value of that $10,000 account is probably,

Speaker 1 you know, a couple of hundred bucks.

Speaker 3 So she shows up in that case with $1,500.

Speaker 1 And says they're going to be, they won't act like it to her. They're going to be jerks to her because they're Bank of America.

Speaker 1 But they're going to be hard to negotiate with. But believe me, they're going to be.
I'm really happy.

Speaker 1 That's 15 cents on the dollar, not 2.5 cents on the dollar that I was talking about. And that sounds kind of absurd to people who are used to paying their bills and all that kind of a thing.

Speaker 1 But in that world, that's a very standard way of looking at things because it's the probability of collection.

Speaker 1 Every day a credit card goes unpaid, the probability goes down dramatically.

Speaker 3 That's right. And I always want to, as a guy who, Dave, I pride myself on paying my bills on time.
I pride myself,

Speaker 3 I always want to remember that voice that I just heard. That's going to haunt me for a while, Dave, is the woman who had an abusive marriage.
The court did what the court did. She's got three kids.

Speaker 3 She's got, like, there are things that pop up in people's lives. And that's where general, that's why you live and give like nobody else, right?

Speaker 3 You get these moments like this for people, and I'm glad that there's those situations they can walk in and say, here, can I just settle this thing and be done with it?

Speaker 1 Yeah, it's awesome. And

Speaker 1 she'll be able to do that. One of the things she's got to do is one of the reasons I wanted her to learn all this is to change the confidence.
She's going to stand up, tall, that's right. Because

Speaker 1 I want her vocal cords to relax where she starts having this conversation. Because you can't negotiate when you sound like that.

Speaker 3 Because they can smell that amount.

Speaker 1 Well,

Speaker 1 everybody could hear how scared she was. Yeah.
So, including the lawyer on the other side. That's right.

Speaker 1 All right. Now, the Ramsey Show.
Question of the day, brought to you by YReFi.

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Speaker 3 I love this question. This question comes from Jessica in Florida.
Do you have advice for adult children discussing wills with their parents?

Speaker 3 We know that my husband's parents will be upset about who we've chosen as the guardians of our children should we pass away before they reach adulthood.

Speaker 3 Should we tell them our plans or leave leave it to them to find out if anything does happen to us?

Speaker 3 Great question.

Speaker 3 Please, please, please have the courage to sit down and have those hard conversations.

Speaker 3 This is a great way for your kids to get dragged through court when your in-laws decide to sue your guardians because they didn't know and blah, blah, blah, blah, blah.

Speaker 3 Yes, have that hard conversation. That's my opinion on it.
Yeah.

Speaker 1 Anytime your will is going to piss somebody off, do it while you're alive. Yes.

Speaker 3 That's a better way to say it.

Speaker 1 Because

Speaker 1 the other parties are going to have to deal with the pissed off person if you don't have the courage to.

Speaker 1 So if you're cutting little Bobby out because little Bobby's doing cocaine, go ahead and tell Bobby you're out of the will because you're doing cocaine. And I'm not giving you money to buy cocaine.

Speaker 1 So you're out of the will.

Speaker 1 I'm going to say it. Well, do whatever you want to do, Bobby.
Just have your little cocaine fit, but you're not going to be in the will.

Speaker 1 And you just have the discussion while we're doing it, while we're alive.

Speaker 1 This idea that there's all these family secrets and all this dysfunction, and it's all going to be solved in a walnut paneled room with the trophy wife and the three kids. That's a movie scene.

Speaker 1 That's not real life.

Speaker 1 Real life is people get angry over the China cabinet.

Speaker 3 And they'll sue you. They'll sue brothers will sue brothers over the China cabinet.
Or actually, brothers, wives.

Speaker 1 The 1957 John Deere tractor can break up a family. Yes.

Speaker 1 Because you didn't deal with it while you were alive. And so, you know, Sharon's dad, he's 96, and he's so got to meet him the other day.
Yeah, he's such a

Speaker 1 mascot on the cruise, right? He came with us on the cruise. And it's sharp as attack.

Speaker 1 He told the kids to go through and flip over anything in the house and write their name on it unless somebody else's name was already on it.

Speaker 3 That's what my grandmother said. She said, put a sticker on it, and once a sticker's on it, no complaining.
That's it.

Speaker 1 She said it's done. First come, first serve.
That's right. And

Speaker 1 I have not looked, but I suspect there's some stickers in there.

Speaker 3 And I also suspect that if you didn't choose these folks to be the guardians of your children, this is why, right? Because they don't respect you as adults.

Speaker 3 They think that they've got all these impositions.

Speaker 1 They don't get a vote. Right.
So they don't get a vote. And let's see.

Speaker 1 My husband's parents. Okay, so he needs to say that.
By the way, when you sit down and talk to them, Jessica, you have a lot of things you want to say. You don't get to say any of them.

Speaker 3 Please don't.

Speaker 3 Let him speak.

Speaker 1 Let him talk.

Speaker 3 And if your husband doesn't want to talk about it tell him to run down walmart and pick up a backbone on aisle three and deal with his mama that's exactly what's going on here and by the way if mom if if if grandparents decide that this just makes them so mad that they don't want to do christmas with you anymore then it's a two-for-one deal for y'all now you'll get to do fun christmas without these goofballs

Speaker 3 I get them, hey, listen, I get them being sad about it. I get them thinking, oh, I wish it was us.
I get that. I get that.
We need need to keep it in the family. I get all that.
They don't get a vote.

Speaker 3 And that's hard. I think, Dave, I keep getting.

Speaker 1 It's hard about everything when you're a grandparent.

Speaker 3 I get this question more and more these days.

Speaker 1 I want to give them more gummy bears.

Speaker 1 I don't get a vote. That's right.

Speaker 3 Actually, I'll still give you more gummy bears.

Speaker 1 I know, but it's sneaking around.

Speaker 3 I think that's part of being a grandparent.

Speaker 1 I might have done that.

Speaker 1 I'm talking about technically following the rules.

Speaker 1 The question is to get them all triggered up before I send them home.

Speaker 3 Is how do we have this conversation without them getting mad, disappointed, frustrated? And you can't. You cannot own somebody else's emotions when you have a hard truth to tell them.

Speaker 3 You can own how you say that hard truth with dignity, with honesty, and with a period at the end of the sentence. Say less than you think you need to say.
They get to decide whether to be angry, sad,

Speaker 3 that's for them. You can't manage that.

Speaker 1 This upsets me. You know, I'm really sorry.
I'm sorry.

Speaker 3 Sorry, it upsets you. You're breaking up this family.

Speaker 1 I'm sorry that you see it. No, I'm not breaking up the family.
If you want to do that, that'll be up to you, but I'm not doing that.

Speaker 1 I just made a decision about this. And

Speaker 1 Jefferson talks about keep these conversations really brief. Very short.
Don't drag all the other crap

Speaker 1 of the toxicity in the in 1962. Now, Brink, just let all that go away.

Speaker 1 This is just a simple thing. I want to tell you what's in our will.
And we wanted to make sure you knew while we were here because

Speaker 1 we think you're probably not going to like it.

Speaker 3 We want y'all to stay grandparents and not have to become parents.

Speaker 1 There you go.

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Speaker 1 Are you sick and tired of being sick and tired? You can take control of your money and your relationships. And it starts with just one night.
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It's coming up fast.

Speaker 1 So get your tickets for Louisville, Durham, Atlanta, Phoenix, Fort Worth, or Kansas City at ramseysolutions.com slash tour today.

Speaker 1 Dr. John Deloney, Ramsey Personality, is my co-host on the debt-free stage

Speaker 1 right here in the middle of the lobby of Ramsey Solutions. Katie is with us.
Hey, Katie, how are you?

Speaker 10 I'm doing well.

Speaker 1 Good. Where do you live?

Speaker 10 Alexandria, Louisiana. Sorry, I'm emotional.
You're going to be all right.

Speaker 1 We'll get you through it. We've never lost a patient.

Speaker 1 So enjoy the ride. Thank you.
How much debt have you paid off, Katie?

Speaker 10 About a little over $67,000.

Speaker 1 Good for you. How long did that take?

Speaker 10 It took me five years and a lot of hurt and heartache and a lot of prayers.

Speaker 1 Good for you. Yeah.
Scratching and clawing, kiddo. And what was your household income range, your best year and worst year over that five-year period of time?

Speaker 10 Side hustles and

Speaker 10 gifts and everything. First year when I started this, it was about $45,000.

Speaker 10 Last year, I ended right around $67,000.

Speaker 1 Good for you. What do you do for a living?

Speaker 10 I'm a pediatric occupational therapy assistant as well as a medical billing specialist.

Speaker 1 Good for you. Wow.
Very good.

Speaker 3 So on behalf of my family, just personal.

Speaker 3 For what you do professionally, thank you. That's a hard gig.
And somebody in your seat wearing wearing your title changed my family.

Speaker 1 So thank you. That's awesome.

Speaker 10 You've been a huge motivation to keep going.

Speaker 1 Well, incredible. Very good.
So what was the $67,000 in debt? What kind of debt?

Speaker 10 Everything except for a payday loan. That is the only thing that I didn't do.

Speaker 10 And a house, I didn't go that far. Lots of medical bills.
The majority of it was student loans. Looking back, that was the worst mistake of my life.

Speaker 10 And bought a car, second worst mistake, bought a car a month before starting this. So

Speaker 10 fortunately, I did buy a used car, so it was not a huge loan, but it was a loan.

Speaker 3 Tell us where that emotion comes from.

Speaker 1 Just the amount of time that it took. The amount of time it took?

Speaker 10 Yes. My goal was two years.
And

Speaker 10 right before starting, I

Speaker 10 mean, sorry, right. During the time that pushed me to start this, I was dealing with some medical things that

Speaker 10 was unexplainable at the day.

Speaker 10 There was no explanation at the time. I'd spent 10 months going back and forth to doctors, saw three or four specialists, did not know what was going on.

Speaker 10 And in October,

Speaker 10 I had already, I've been a side hustler since I was, you know, since I started working at 16, before I even knew what a side hustle was.

Speaker 10 And I was dog sitting and I stumbled across the Ramsey show on YouTube. And I was dog sitting, so what else do you do? I mean, I binge watch.

Speaker 1 You know, dogs help us a lot. They promote the show quite often.
Yes, yes.

Speaker 10 So, and actually, the family that I was dog sitting for,

Speaker 10 they are a pediatric therapy center about two hours from where I live. I worked for them in college, and they're Ramsey.
They do all the entree leadership.

Speaker 10 They've been to Summit, and I think when you guys were in Florida,

Speaker 10 and Christie,

Speaker 10 and they have Believe and Achieve Therapy in Monroe, Louisiana. And so I was dog sitting for Christie, they're therapy dogs.
And

Speaker 10 I

Speaker 10 just, I watched the show, I think, for 18 hours one day because I mean what else do you do you know and so I was like this is what I need because I had medical bills that had started pouring in I had just bought a car and I was just I was very down and I was I didn't know what to do you know and so

Speaker 1 so binge watching the whole thing gave you tools and gave you hope

Speaker 10 it didn't give you shame right and I will say I tell everybody I knew what you were going to say I watched it so much I knew what you were going to say before you knew what you were going to say a lot of people play answer the question before date when they're driving.

Speaker 10 Yes, I do that a lot. And so I got started and I started saving my emergency fund.

Speaker 10 I actually, a few weeks later, I was talking to my boss and I was sharing with her,

Speaker 10 we were close and worked for a very small clinic in Alexandria. Shout out to MB Therapy and all of my team.
They may be watching or they're probably working.

Speaker 10 But I was talking to her and sharing with her that I had started. I had done my $1,000 emergency emergency fund with actually the money that I made doing dog sitting and then a few other odd jobs.

Speaker 10 And she said, oh, yeah, you need to do this. She said, my husband and I, Todd and Megan Bolton are their names.
And she said, my husband and I did it 20 years ago when Dave taught the class.

Speaker 10 And she said, and that's why we were able to,

Speaker 10 that's why we do things the way we do. And so that was in 2019 when I started.
Well, you know what happened in 2020? And so

Speaker 1 looking back,

Speaker 10 I'm so grateful that you taught the class that they took in Monroe, Louisiana 20 something years ago.

Speaker 1 Yes. Oh my gosh, we did an event at the Baptist Church.
Yes. That was a thousand years ago.

Speaker 10 They took it. I'm not sure if it was that specific event or I know it was through the employer that he worked for, but I'm not sure.
I don't know all the details.

Speaker 10 But all I know is that we are about to build a multi-million dollar. clinic debt-free

Speaker 10 and she was able to continue meeting payroll. We never missed a payment.

Speaker 10 I never missed a paycheck during COVID. And we actually

Speaker 10 probably tripled our patient load during 2020, 2021 because she was able, never took one of the loans that was offered.

Speaker 1 Guess what? One of the paychecks was yours. Right.
And you're trying to get rid of $67,000. Yes.
Wow. Scraping up clothes.

Speaker 1 So what was the first thing you paid off?

Speaker 10 First thing I paid off was probably a medical bill.

Speaker 1 What was the last thing you paid off?

Speaker 10 Last thing was student loans. I did not realize until later that that I was supposed to have broken those up into smaller loans.
And so I always treated it as my biggest loan, but they're gone.

Speaker 10 So I did that, took care of that. On December 1st.

Speaker 1 How does it feel not have any?

Speaker 10 You have no idea. I mean, you do, but it's just so amazing to me.

Speaker 3 Have you had that month yet where you didn't have any payments, but your paycheck deposited?

Speaker 10 That was this month, actually. What was that like?

Speaker 10 It was amazing. It was supposed to have been February.
We were celebrating the, that's another story, but we celebrated the adoption of my little boy

Speaker 10 in February. And the night before his party, I was bringing his cake back home for the party the next day.
And he and I had a massive car accident, totaled our car.

Speaker 10 And I had so many people say, well, you're going to get a car? You're going to have a car payment? And I said, nope. I said, God's going to provide.

Speaker 1 And

Speaker 1 we got insurance, didn't you?

Speaker 10 I did, but I didn't know.

Speaker 1 I didn't know.

Speaker 10 You know, I didn't know what kind of an insurance check. I had an older car.
I was driving my, the car that I was driving, I had bought five years before, and it was old when I bought it.

Speaker 10 And so it was a good car, but, you know, it wasn't worth a whole lot. So

Speaker 10 I talked to my brother about purchasing his car. He's in the military, so he had a lot of,

Speaker 10 you know, talked about that. He doesn't need the vehicle.
And so that was kind of what I was thinking, but it was.

Speaker 10 I think it's a 2000, 2001, something like that. But my parents reached out to me and said, hey, we're talking about getting a new vehicle.
So, you know, we'll sell you this one for this amount.

Speaker 10 And I said, okay, you know, we'll see what my

Speaker 10 insurance check is

Speaker 10 because I don't know if I'll be able to swing it. But, you know, and then they had agreed that they would give me a small amount as well toward the purchase of whatever I bought.
And so

Speaker 10 a couple of weeks later, I got a phone call from my insurance company and it was almost to the penny of everything that I needed to pay for the car in full

Speaker 10 as well as the registration. I paid $200 over to cover the registration.

Speaker 10 Yes, I went from a 2016 Centra to a 2016 rogue. So

Speaker 1 I like it.

Speaker 1 Yeah. Proud of you.
Yeah. They're proud of you.
I bet they're proud of you. Yes.
Yeah. And you got control of something that needed to be getting control of bad, I can tell.
Yes, yes.

Speaker 1 What do you tell people the secret to getting out of debt is?

Speaker 10 If I can survive cancer, move through an adoption, cash flow, a bachelor's degree, and part of a grad school degree that I quit because I just decided I was tired of paying for it.

Speaker 10 If I can do it through all of that, anybody can do it.

Speaker 1 Amen. So persevere is the answer.
Yes. Don't quit.
Yes. 67, or five years, six months, 67,005 years.
Yes. That's a long slog, kiddo.
It was. But the good news is, is now you have control of you.

Speaker 1 And now you have control of this subject that owns so many people. And now you own it.
It doesn't own you anymore. So fabulously done, kiddo.

Speaker 3 Dude, in anything that comes your way in the future, you're going to be able to smile and say,

Speaker 3 just buckle up because I've already been through worse than you.

Speaker 1 That's awesome. Buckle up.
You've done warrior princess, kiddo. Well done.
My child screaming. Very well done.

Speaker 3 I thought it was gay for a second, then I realized it was your kid.

Speaker 10 Nope, that's mine.

Speaker 1 It could be one of the personalities out there. That's right.

Speaker 3 It's George Kimmel out there.

Speaker 1 George, George, behave.

Speaker 3 Hey, I'm really proud of you. It's awesome.

Speaker 1 Hey, all right, Katie. Count it down.
$67,000 paid off in five years, making $45,000 to $67,000 count it down. Let's hear a debt-free scream.
Three, two,

Speaker 10 one.

Speaker 1 I'm debt-free.

Speaker 1 Yeah.

Speaker 1 Wow, some of them feel stronger than others. I like it.

Speaker 1 I love it.

Speaker 1 Oh, thank you, Lord. This is the Ramsey Show.

Speaker 1 Hey guys, good news. Pre-sale is on now for my new book, Build a Business You Love.
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Speaker 1 Louis hey nikki what's up in your world

Speaker 2 hi ramsey show it's so great to be on here thank you so much well thank you how can we help

Speaker 2 so I have 260k in federal student loan debt.

Speaker 1 Good Lord.

Speaker 1 For what?

Speaker 2 Well, I have a Bachelor's of Science in Chemical Engineering, and I have a Master's in Engineering Management.

Speaker 1 Great. How much do you make? Yeah.

Speaker 2 So that's the catch. I was working in the field, and once 2021 hit,

Speaker 2 I had my daughter in the absence of her father. He passed away.
So I kind of had to step back from the field for a little while and focus on my motherhood. But I'm ready now to come back.

Speaker 2 And I'm back in chaos in the economy that I just feel like is not working for engineering.

Speaker 1 Oh, bull crap.

Speaker 2 No, for a mother, a single mother, balancing that together.

Speaker 1 Well, you can't not work. You have to work.
But if you go to work, engineering is an exploding field right now. And you got more degrees than a thermometer.

Speaker 1 You need to go make some money.

Speaker 1 Right.

Speaker 1 You desperately need to make up. You need to be making 200K.

Speaker 2 200K. Okay.

Speaker 1 Yesterday.

Speaker 1 What is the deal?

Speaker 1 What are you waiting on? I don't understand.

Speaker 2 Well, this is the thing. I am trying to figure out.
I've been interviewing and it's like I'll get close to a yes, but as soon as it's, oh, we may need you to stay in, we may need you to be on call.

Speaker 2 And as an engineer, that's kind of like the livelihood before my motherhood kicks in. Being on call and being available, which I've always been able to.

Speaker 2 But now that you're a mom, a single mom at that, you have to not be available at those times. You have to take care of the child.

Speaker 3 You do, but you're, A, going back to grad school isn't going to solve that problem. And B,

Speaker 3 You're fishing in a very small pond.

Speaker 3 Do you get what you get what I'm saying?

Speaker 2 What do you mean by fishing small time?

Speaker 3 I'm saying you are continually looking for the same jobs and the same type of engineering place, right? That's going to always come back to you. It's like me.

Speaker 3 If I want to go back to being a dean of students, but I don't want to be on call, I can't have that job because that's the important part of that job.

Speaker 3 But if I want to work at a university, I'm going to have to broaden what I'm looking at with my skill set. Do you get what I'm saying? You're an engineer.

Speaker 3 You can do stuff that Dave and I can't do because you have a license. You can go do amazing things.

Speaker 3 But you're going to have to broaden your picture of what being an engineer is like. Or

Speaker 2 it may not be direct or indirect. It could be indirectly related, but still.

Speaker 1 Of course. You've got to skip.

Speaker 1 You're able to

Speaker 1 solve. You're going to have to $1,000 in debt.

Speaker 3 Yeah. And by the way,

Speaker 3 I'm telling this because I love you. I sat with what I would call, we called, when I was a graduate school professor, perpetual students

Speaker 3 who kept going for the next license, the next degree, the next thing,

Speaker 3 not as a way, I had to get another degree because my field, I felt, was closing and I needed a licensure.

Speaker 3 You are just trying to avoid the grind that is, if you want to make $200,000, a business wants you to work that hard. And that just stinks.
It's hard. And I think you can.

Speaker 1 And listen, if you talk to people in an interview like you've been talking to us, you're never going to get hired.

Speaker 1 I wouldn't hire you. You want to know why?

Speaker 2 Why?

Speaker 1 Because you told me six times how you had to take care of this baby. And And I know you're a single mom.
I know you need to take care of your baby. That is first.
There's no question about that.

Speaker 1 As soon as I know you're a single mom and you have a baby, anybody who's got a human brain knows that's your first priority.

Speaker 1 But don't tell me that six times because what that tells me is you're not going to be reliable. It tells me you're not coming to work.

Speaker 1 It tells me you're coming to work for what you can get rather than what you can give. You're not here to add value to the organization.

Speaker 1 You're here to extract value with as little work and as little availability as possible. You're not getting hired.

Speaker 1 You've got to change your attitude about what can I add? How can I be enthusiastic? How can I add value to this organization? And that is the best way you can serve your child.

Speaker 1 And is getting rid of this $260,000 worth of debt.

Speaker 3 That's it. It's looking at you have some, you have extensive liabilities out on your family for this thing.
So you think just being present with this kid is the greatest gift.

Speaker 3 The greatest gift you can give that kid, yes, is your presence, but

Speaker 3 like having a house with peace in it. And you're in for over a quarter million dollars.
You don't have you have no peace.

Speaker 3 And so you can find a high school kid, a college kid in your local community who will be on call with you.

Speaker 3 I'm going to pay you 25 bucks an hour, 30 bucks an hour, 50 bucks an hour to come over on those rare nights I get called. And you come over to my house within an hour and you're like, I need you here.

Speaker 1 I actually have four of them. Got it.

Speaker 1 On call. And so that if one of them is on a date, you can still get them over.

Speaker 3 And you can overly pay them. And so then maybe you get burned a few times.
You have to spend some money. And instead of making 200 grand, you make 190.
You're still really winning.

Speaker 3 And your debt's paid off in two years.

Speaker 1 You being at home full-time and rocking this baby eight to eight, nine hours a day is not an option for you anymore. You gave that up when you signed up for $260,000.

Speaker 1 Now you've got to solve big boy and big girl problems.

Speaker 1 And so

Speaker 1 the sad situation of where you are and the loss of your husband is leaving you with no choices. I'm so sorry.

Speaker 3 Please don't go get another degree. Please.

Speaker 1 Please, please, please, please. And please lean into the fabulous degrees and brain that you have.
You have an incredible brain. I mean,

Speaker 1 dumb people can't get these degrees that you have. I mean,

Speaker 1 you get a had gun master's in chemistry, was it? Yeah. Oh, my gosh.
I mean,

Speaker 1 you can do any kind of math. Well, here's the other thing.

Speaker 3 You probably had an arrangement with your husband that one day this was going to be how this was, right? Maybe you're going to be a stay-at-home mom. Maybe you're going to work part-time.

Speaker 3 And there's something about grieving the end of that dream, too, because he passed away, and I know you've grieved his loss and all that, but there's this moment now, and now I've got a kid, and now I've got this, it just stinks, man.

Speaker 3 It's heartbreaking.

Speaker 1 Yeah, I'm sorry. Yeah.

Speaker 3 Go get it. Go get it.
Go get it. Go get it.

Speaker 1 Yeah. You can do this.
It is doable for you, but

Speaker 1 that's the trick, Nikki.

Speaker 1 You're going to have to lean in and make a career now

Speaker 1 while you find some alternative and different ways to

Speaker 1 work through the motherhood thing. So, I mean, it's not unusual at all for someone making two or even $300,000 a year to have a full-time nanny.
Absolutely. That's what you've got to have.

Speaker 1 If that's what you have to have. Or an overnight need.
If that's what you have to have. Yeah.
Or somebody that's on, quote, on call, unquote. But,

Speaker 1 yeah, you're trying to do six things at once, and you're going to have to choose one. And I'm telling you, you've got the tools in your belt to make serious money.

Speaker 1 And if I were you, not because money's important, but because getting the freedom from that student loan is important.

Speaker 1 Once you're free from that, if you want to take a job making $100,000 instead of $300,000, and that gives you more flexibility, fine. I got no issue with that at all.

Speaker 1 But you've got to clean this mess up for your sake, for your sake.

Speaker 1 And for everyone out there listening,

Speaker 1 getting another degree, getting degrees to the tune of $260,000,

Speaker 1 there is no time in life. that that works out.
Zero.

Speaker 1 There's only one way that works out, and that never happens, and that's if your plan works exactly like you thought it was going to work.

Speaker 1 She didn't think when she took out $260,000 worth of degree to get to pile up degrees like a thermometer that she was going to end up being a single mom because her husband passed away.

Speaker 1 That wasn't on her plan. That was not on her bingo card.
Well, guess what? Your life that comes at you is not on your bingo card. You don't know what's going to come.

Speaker 1 That's why you don't go take out these kinds of loans. Well, it's always a good investment.
No, it's not a good investment. It's It's a trap.

Speaker 1 And it's a sin that our government does this to its own people.

Speaker 1 A sin. You ought to stop it, Congress, now.