Life Happens — Don’t Let It Wreck Your Finances

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Speaker 1 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 Rachel Cruz, number one best-selling author, host of the Rachel Cruz Show and Ramsey Personality. My daughter daughter is my co-host today.
Open phones at 888-825-5225.

Speaker 1 Mary is in Canada. Hi, Mary.
Welcome to the show.

Speaker 2 Hi, thank you for having me.

Speaker 1 Sure, what's up?

Speaker 6 So we, I'm in a situation where I've been married and my husband lost his job about two years ago.

Speaker 6 And there's been a bunch of different circumstances that leading me to think that unfortunately this relationship might not work out.

Speaker 6 So, in preparing for that, because we do have some debt that accumulated, especially in the last two years, I'm just kind of wondering: should I pay off some of this debt before we officially separate to make things easier, or

Speaker 2 how to proceed with that?

Speaker 1 Okay,

Speaker 1 so what's going on with him?

Speaker 8 Well,

Speaker 6 he lost his job two years ago.

Speaker 6 He took that very, very hard, and it affected his mental health significantly. And he's been really struggling with that.
And we've been trying to support him.

Speaker 6 Unfortunately, in

Speaker 11 dealing with that,

Speaker 6 some of his choices have been not the correct ones, you know, going into substance abuse and things like that.

Speaker 1 So he's got, he's an addict. Okay.

Speaker 1 Yeah.

Speaker 1 Okay. And

Speaker 1 I'm sorry. That frames up the whole frames up the whole thing a little differently.
Okay. All right.
And so what do you make a year?

Speaker 6 I make about $140,000 to $150,000 a year.

Speaker 1 Okay. And how much debt do you guys have?

Speaker 6 So we have about $125,000 in debt and then our mortgage.

Speaker 1 And how much is on the mortgage?

Speaker 6 $155,000.

Speaker 1 What's the house worth?

Speaker 6 If we were to sell it now, probably $500,050.

Speaker 1 So we got substantial equity. And the $125,000 in debt is on what?

Speaker 6 So there is one vehicle that's

Speaker 6 there and then

Speaker 13 there is about

Speaker 6 $50,000 on the vehicle.

Speaker 6 Okay.

Speaker 6 And then there's $7,000 on credit card, and the rest is a line of credit. Okay.
All right.

Speaker 1 Okay. And do you have any money saved that's not retirement?

Speaker 6 About $1,800.

Speaker 1 $1,800.

Speaker 4 $1,800.

Speaker 6 I have $1,800. He has about $12,000.

Speaker 6 Okay.

Speaker 1 So you don't really have the option of paying off the debt if you're leaving anytime soon.

Speaker 1 So the debt is going to get

Speaker 1 divided up in the divorce, is it not?

Speaker 6 Yeah, but right now he has no income

Speaker 6 to

Speaker 1 understand.

Speaker 1 But that'll be his problem after the divorce.

Speaker 1 These are based on the choices he's made.

Speaker 1 That's his issue. It's not going to be your issue anymore, right?

Speaker 6 Well, no, but I think legally I will have to give him some money.

Speaker 1 Monthly

Speaker 6 I'm hoping to do it in a lump sum, yeah, out of the house.

Speaker 1 Yeah, so I would sell the house and clear the debt and clear him and start fresh.

Speaker 1 That would be my strategy, but that's all part of the divorce. I think I have no idea how this crap works in Canada.

Speaker 14 Have you talked to a lawyer, Mary?

Speaker 6 I did, and it's

Speaker 6 if the answer is definitely we'll have to pay him something.

Speaker 8 Um

Speaker 6 and, you know,

Speaker 6 selling the house is

Speaker 6 I like, ideally, I would like to avoid that because

Speaker 14 you want to keep it.

Speaker 14 Why?

Speaker 14 Um

Speaker 6 for the kids a little bit, it's, you know,

Speaker 6 it's where my support

Speaker 4 is.

Speaker 8 Um, you know,

Speaker 1 But you got $125,000 in debt. You don't have a way to clear.
I know.

Speaker 16 Yeah.

Speaker 1 Who's driving the $50,000 car?

Speaker 6 Currently, that's mine. Yeah.

Speaker 5 And we had two paid cars, and they were...

Speaker 1 That's going to be sold unless you d sell the house.

Speaker 16 Yeah.

Speaker 1 Because you can't afford it. You can't do all of this, Mary.
You've got to decide you're going to have to decide where the pain is. And

Speaker 1 your support's in that neighborhood. It's not in that house.

Speaker 1 Right. So, I mean, go down the street and rent an apartment in the area.
And let's go. Because the kids, listen, the idea that you keep the home is going to make the kids okay.

Speaker 1 The kids aren't okay already. Their dad's an addict.
He hadn't worked in two years. The kids feel all of this in the air already.
It's already established in your household.

Speaker 1 So the kids are already going through trauma, and moving is the least of their traumas.

Speaker 1 Especially if you just move down the street and keep them in in the same school and so forth. So that,

Speaker 1 I don't know what you're going to do. I'm sorry you're facing this.
It's awful. But you need $125,000 and you need enough money to write him a check for him to go away.

Speaker 1 And I only see one source of that.

Speaker 14 And that all has to happen

Speaker 1 simultaneously. Yeah.
For her to have a good life. Yeah.
I mean, if she keeps all this debt

Speaker 1 and keeps this house and,

Speaker 1 you know, and just basically boots him out and she takes all of this as her responsibility, That's going to be very difficult for them. For sure, for sure.

Speaker 1 And, you know, it's just, to me, it's not worth it.

Speaker 1 I would want a clean, fresh start after this tragedy that you're going through.

Speaker 14 Yes. And you may still have some left over from the sale of the home with everything.

Speaker 1 It depends on what we got to pay him. I mean, there's $350,000 worth of equity.

Speaker 14 And paying him one-time fees, what she's hoping, like a one-time loan.

Speaker 1 So if you pay off $125,000 out of $350,000,

Speaker 1 you've got two and a quarter left. If he goes away for 100, you've got 100 and a quarter left, but he's not going to go away for 100 because he's going to want half the house.
Right, right. So

Speaker 1 it's a problem.

Speaker 14 Yeah, and I understand, Mary, the wanting the stability of the least amount of change possible for the kids, right? Like, I do understand that mindset of

Speaker 14 as much as we can keep the same

Speaker 1 better.

Speaker 1 But

Speaker 14 what I was going to say is your role as a mom and a parent is going to help override a lot of that. Like, I do think there can be a

Speaker 14 not a false sense by any means, but an overreaching of a belief of, like, okay, but if this stays the same, everything's going to just be a little bit better.

Speaker 14 But I think you, as an engaged mom, not a stressed-out mom, not a mom that's panicked all the time because of money, but you have the margin emotionally because you've set yourself up financially for your kids.

Speaker 14 Like, that is as much of a gift than trying to create the same similar

Speaker 1 situation. You're exactly right.

Speaker 1 if the kids stay in a home that is full of financial stress yeah it's not a it's not a net positive yeah that's right yeah it's a net negative and that's what we run into all the time is this idea that somehow the home is going to make this whole thing better and it's not uh what makes it better is for you to get in a place where you don't have because you've been fighting demons for a while i mean they're they're coming at you from everywhere And so you got financial stuff coming at you.

Speaker 1 You got all this addict stuff. You got all this conflict and anxiety with a husband.
I mean, and to have all of that gone,

Speaker 1 man, it's a breath of fresh air. I'm sorry you're going through this, though.
It's horrible.

Speaker 1 Hey, quick reality check.

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Speaker 1 Carrie is in Denver. Hey, Carrie, how are you?

Speaker 2 Hi, I'm good. Thank you so much for taking my call.
Sure.

Speaker 1 What's up?

Speaker 9 All right.

Speaker 20 So about two years ago, I got a settlement from a car injury, and it was for quite a lot of money. It was for $350,000, which is like the most money I've ever seen or ever expected to see in my life.

Speaker 3 So I think I way overcomplicated it.

Speaker 20 I felt really weird about putting all of it into

Speaker 3 the brokerage account. So I split it up, and now I've got like 10 different accounts.
And my question is, like, should I combine a lot of these?

Speaker 14 What accounts are they?

Speaker 22 Okay, so I've got a CEP IRA, a WASS IRA, a traditional IRA, a brokerage account, two CDs, and a high-yield savings account.

Speaker 14 That's called diversification, Carrie.

Speaker 1 You do have a lot right there. They're not all terrible, though.
No, everything's fine.

Speaker 1 The only thing I would probably roll your CDs into the high yield because they're paying about the same and the high yield doesn't have any penalties. But that's a minor detail.
That's a minor detail.

Speaker 1 But

Speaker 1 overall,

Speaker 1 they're not all different accounts. They're all different

Speaker 1 methods of,

Speaker 1 I mean, you've got some retirement things you did, which are wise. You've got some short-term things that you did that you may use some of the money, like to buy a house or something in five years.

Speaker 1 That's the brokerage account. And then you've got some money that's just sitting there liquid, meaning

Speaker 1 it's not at risk at all. It's just sitting, it's not earning anything hardly.
And that's the high yield savings and the C D. So it sounds like someone gave you some pretty good advice.

Speaker 23 I've been listening to your show.

Speaker 24 It's actually you guys.

Speaker 1 Oh, wow. Okay.
Well, there you go.

Speaker 1 The people that advised you were geniuses.

Speaker 14 Just pat yourself on the back there, Dick.

Speaker 1 Those people, those people that helped you, they're just smart. I'm just saying.
Yeah.

Speaker 1 Yeah.

Speaker 1 What I always tell folks to do, listen,

Speaker 1 you mentioned something that's very important. This is amount of money I never thought I would see.

Speaker 1 So what that amounts to is I'm doing something I've never done, and so I feel intimidated and inept, which is normal.

Speaker 1 That would be normal to feel that way if you're doing something you've never done before, right?

Speaker 1 And so

Speaker 1 I would want to go on

Speaker 1 a learning journey more than just listening to our YouTube clips or something,

Speaker 1 to where you begin to say, okay, I I felt that way at first, but now I, over the last three years, I've learned all these different things and I've had these different experiences with these investments, and now I feel very comfortable and competent and that should be that's your big goal is to get the other side of the learning curve on this and it's not a panic but I want you to feel confident and I don't want you to ever to where five years from now three years from now you're not saying that anymore which also means you're not going to make any mistakes

Speaker 1 okay okay so yeah so I would tell you to go to a smart vestor pro is what I'm saying get go to Ramsey Solutions and click on smart vestor find a smart vestor pro in your area sit down with them and have them look over what you've done and

Speaker 1 if they would do anything different or if you want to move the accounts with them, that's fine. And just begin to learn

Speaker 1 what we're doing and where we're going from here. Yeah, it's great.
It's very well done. Very smart.
Yep. It's funny.
All right. Lauren is in Ohio.
Hey, Lauren, what's up?

Speaker 13 Hi, Dave. Hi, Rachel.
Thank you so much for taking my call. Sure.

Speaker 13 So I'm 30 years old.

Speaker 13 I have been following the baby steps for a little over six years, probably about seven now.

Speaker 23 I got out of debt.

Speaker 13 I have an emergency fund.

Speaker 5 I was able to pay cash for a car last year.

Speaker 1 And I've

Speaker 13 thank you. Thank you so much.

Speaker 13 I've been ready to start saving up for a house.

Speaker 21 I'm currently renting.

Speaker 13 But I've also been in a relationship with someone for eight years. He's 49 and is not very financially responsible.
And I think I need some advice on next steps to take.

Speaker 14 Dang. So your financial transformation happened while you've been dating him.
Like you said,

Speaker 14 you did all of this.

Speaker 1 Okay. Yes.
And what you watched.

Speaker 1 And meanwhile, he did nothing.

Speaker 13 Pretty much. He cleaned up some tax problems that he'd had in the past.

Speaker 1 Good.

Speaker 1 He's now legal.

Speaker 1 Yes.

Speaker 13 But he's since financed vehicles, and now he has one working vehicle and one non-working vehicle, and they're both financed, and he's very upside down.

Speaker 1 So ignorant.

Speaker 1 Exactly, what is your question?

Speaker 13 Exactly. My question is,

Speaker 13 do I need to take care of myself by getting out of here?

Speaker 7 Or

Speaker 13 is there something else I can do to help him see the light, quote unquote?

Speaker 14 Well, have you guys talked about it, had conversations over the last eight years about money?

Speaker 3 For many, many years.

Speaker 14 Can you raise these concerns that it makes you nervous and kind of fearful with his financial patterns. And what does he say?

Speaker 25 Basically,

Speaker 13 he either becomes very defensive, like

Speaker 13 I'm doing this and I'm doing that. And if I just change this one thing, this will all go away.

Speaker 7 And, or

Speaker 13 you think I'm so bad with money and

Speaker 1 finances. Yeah, I kind of do.
Yeah. Yeah, I kind of do.

Speaker 13 I just don't know where to go from here.

Speaker 9 Is it time to

Speaker 1 face the facts?

Speaker 14 A question I always like to ask, Lauren, is do you look at him and think, what a winner

Speaker 1 he is.

Speaker 21 Do you? Yeah, there's no, there's that, yeah, that's in there.

Speaker 1 Do you want to be married to that guy?

Speaker 1 You don't respect him, do you?

Speaker 3 No, I don't. Yeah.

Speaker 1 I don't at all.

Speaker 1 It's not a matter of whether he's holding you back. It's a matter of what do you want to spend your life with.

Speaker 13 Yeah.

Speaker 1 Yeah. And I'll say this, Lauren.

Speaker 14 To me, it's not about the money, you know, a certain amount of money that he's worth or whatever. It's the values and the patterns at which he lives his life.

Speaker 14 And when those are in conflict with how the value system at which you live your life, that's a really hard marriage to be a team and to enjoy life together. Like, you know what I mean? Like, it's.

Speaker 1 You're going to make him miserable.

Speaker 14 You're going to make him miserable.

Speaker 1 And he's going to,

Speaker 1 no, and he's going to make you miserable. But I mean, you need to understand that, you know, just standing beside him makes him

Speaker 1 the reflection is not good. You know, I mean, it's

Speaker 1 that's the truth. I mean,

Speaker 1 your very presence reveals his deficits.

Speaker 1 And so I often feel like his mother rather than his brother.

Speaker 1 Yep.

Speaker 14 Yep. Well, because you sound like the responsible one.
The one that lives in reality. You know what I mean?

Speaker 1 I think you've already made your call before you called here, hadn't you?

Speaker 21 I might have. Yep.

Speaker 14 I'm sorry, Lauren.

Speaker 1 That's hard. I mean, eight years.
That's a, yeah.

Speaker 14 Do you guys live together? Are you guys going to have to like separate? Okay, yeah. So it's going to be a big, yeah, this is a big, a big breaking for sure.
Absolutely.

Speaker 1 And here's the other thing:

Speaker 1 it's been eight years,

Speaker 1 and this is not,

Speaker 1 and it has been discussed over and over and over and over. He's not going to change.

Speaker 21 That's what I was afraid you'd say.

Speaker 1 So

Speaker 1 when you announce this and he says, Oh, I'll change,

Speaker 1 he means it, but he still won't.

Speaker 13 But he still won't.

Speaker 1 Yeah, do you think? I mean, the pattern is ingrained, or I just know.

Speaker 14 Well, Andy's a 50-year-old man. Do you know what I'm saying? I'm like, it's not like you guys are both 24-year-olds and he's like trying to figure out the world.

Speaker 1 I'm like, dude,

Speaker 14 you got like 12 years on

Speaker 1 me and my spin. I don't know.

Speaker 1 You're 50. 19 years old.
50. Yeah.
I'll tell you what I would do is I would pick up the book, Necessary Endings by Dr. Henry Cloud.
I think it will inform your intellect and soothe your emotions

Speaker 1 as you decide to walk through this. Because

Speaker 1 we're doing an emotional thing with an intellectual discussion. And that's a hard.

Speaker 1 And then when you get into it, it's going to be emotional.

Speaker 1 Absolutely. Because you're not a psychopath.
And you like him. You love him.
You don't want to hurt him. him.
You're not a mean person.

Speaker 1 We're not trying to bully someone or gaslight them or something like that. It's just you're just going, this is just not going to end.
I don't want to be sitting here 40 years from now.

Speaker 1 That's what you're saying. The trajectory on this sucks.

Speaker 1 And you just don't respect him. And

Speaker 1 it's hard to do

Speaker 1 in-depth close relationships with anyone you don't respect.

Speaker 14 And his response to you pushing a little bit of conflict when it goes defensive and you start getting blamed, that's going to be your relationship, not just with money, but other things, right?

Speaker 14 That's the value system and the paradigm he lives in.

Speaker 1 And yeah, you don't want a partner like that, you know?

Speaker 1 I've seen people do everything possible to get out of debt, selling stuff, starting side hustles, canceling subscriptions, giving up eating at restaurants, even turning off the air conditioner in the summer and sweating through it.

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Speaker 1 If you're tired of living paycheck to paycheck and feeling like you can't get ahead, join one of our free

Speaker 1 Every Dollar Trainings. These are new trainings every month, and they're all hosted by one of the Ramsey personalities.
Rachel, when are you doing the next one?

Speaker 14 Next week. Okay.

Speaker 1 I think maybe Wednesday. Coming up up soon.

Speaker 14 I did one this week. Yeah, they're great.
They're really.

Speaker 1 We're showing you how to stick to a budget, and you find thousands of dollars of margin. Everybody that goes through it, we show you here.
You can do this, this, this, and this.

Speaker 1 We give you a list of things. It's always thousands of dollars of things you can do to start turning the corner.
And so ask any question during the live Q ⁇ A.

Speaker 1 George was saying yesterday that the live Q ⁇ A is excellent.

Speaker 14 Oh, yeah. Well, it's fun.
It's like this show. I mean, you get to, yeah, people jump on you.

Speaker 1 Except you can actually get through.

Speaker 1 Yeah, you're there.

Speaker 1 So sign up for free at ramseysolutions.com/slash webinar. Free every daughter trainings.

Speaker 1 Free. Did I mention they're free? Chance is in Sacramento.
Hey, Chance, what's up?

Speaker 1 Hey, how are you doing? Better than I deserve. How can we help?

Speaker 25 Man, this is cool.

Speaker 26 So, I'm actually calling about,

Speaker 26 I'm calling on behalf of my mom.

Speaker 27 I'm a small business owner.

Speaker 26 She works for me.

Speaker 27 She's 62,

Speaker 27 and

Speaker 26 she was having a little bit of a tough time getting laid off at different jobs she was working at. So now she just works for me, and it's pretty low stress.

Speaker 26 But I'm just concerned about

Speaker 27 what I can do as a son to help her out with her future retirement and kind of where she's at right now.

Speaker 25 I have a list of some of the different amounts that she currently has whenever you're ready.

Speaker 1 Okay.

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

Speaker 25 So

Speaker 28 I bring home

Speaker 26 $83,000, but take home's about $73,000.

Speaker 1 And that's on this business?

Speaker 26 On the business, yeah.

Speaker 1 Okay. And

Speaker 1 what are you paying her?

Speaker 26 $45,000.

Speaker 1 Okay.

Speaker 25 Makes $22,400.

Speaker 25 Okay.

Speaker 1 All right.

Speaker 1 You were getting ready to say something on on the eighty-three. You make profit in addition to that?

Speaker 26 Yeah, that's just my salary.

Speaker 1 Okay. So what's the business make? What's your profit that you get paid that you can pay taxes on?

Speaker 1 Oh, these are this is good.

Speaker 11 I'm getting a lot better at this.

Speaker 27 So

Speaker 28 last year was $1.5 to $1.4,

Speaker 26 and we made a profit of about $100,000.

Speaker 27 Good. This year we're going to do...

Speaker 1 You made a profit of $100,000 after you paid yourself $83,000.

Speaker 1 Correct. So you made $183,000 personal income.

Speaker 1 Correct. Because you own 100% of the business, right?

Speaker 1 Yes. Okay.
That

Speaker 1 tells me what you've got to work with to try to help her, other than the $45,000. Okay, so what does she have? Does she have any money saved?

Speaker 1 Yes.

Speaker 1 So currently, there's

Speaker 26 $97,000 in an annuity, an indexed annuity that's going to mature next year.

Speaker 1 Good.

Speaker 27 And $91,000 in an individual brokerage account.

Speaker 26 $57,000 in a traditional IRA.

Speaker 27 And almost $7,000 in a Roth IRA.

Speaker 1 Good, good. Okay.

Speaker 1 What I would do is take her and sit down with a Smart Vestor Pro in your area, a broker that we recommend, and help them develop a plan plan to get all of this money working together.

Speaker 1 She's got about almost $300,000 there,

Speaker 1 $250,000 anyway, and get that all working for her, keeping her hands off of it. Let her s build a sustainable budget on the $45,000.

Speaker 1 And if she just leaves it alone and keeps working, in seven years it will double.

Speaker 1 So it'll be instead of $250,000 it'll be $500,000.

Speaker 1 Man, that's good news.

Speaker 27 That seems a little bit better than the amount that I was looking at.

Speaker 1 Yeah, because this is a little slim. It's not enough, but she's only 62.

Speaker 1 So, I mean, she can work as long as long as she can keep working and you can keep paying her.

Speaker 1 And then, of course,

Speaker 1 you know, do you have many, how many employees do you have?

Speaker 25 So we have eight guys in the field, and three of us are management, with my mom being one of the managers. Okay.

Speaker 1 All right. Well, I mean, if you can find,

Speaker 1 if you wanted to start, you can talk to the Smart Investor Pro about that too, what's called a simple 401k

Speaker 1 or a simple IRA. It's a 401k for small businesses.
Costs nothing to get it started, but you do have to match up to 3% what people put in.

Speaker 1 But she could continue to put money in that and you can match her then.

Speaker 1 And you can help her that way and help her fund her Roth IRAs every year in addition to having this money invested well. So there's some things you can do here.

Speaker 1 Yeah, does she have because you're making some money?

Speaker 14 Yeah, Chance, did she have an age that she was wanting to retire and you guys are trying to figure out if she was able to, or is she great to work for longer to get this built up?

Speaker 26 No, my family dynamic is kind of,

Speaker 26 you know, my dad had an injury a long time ago, so he's not in the picture.

Speaker 25 And my mom

Speaker 27 is kind of not looking at me for,

Speaker 27 but like, I just, I want to be a good guidance for her.

Speaker 1 So she, I'm looking at her to work to 72.

Speaker 27 Yeah, she's ready to work for as long as she'd like to.

Speaker 26 And even if she's not, I'm still going to pay her, you know, or take care of her or do what I need to do.

Speaker 1 Yeah. Well, I mean,

Speaker 1 be careful about that part of this. Let's, let's develop a plan that has the dignity of sustainability on her own, where she doesn't have to be.

Speaker 14 Is she going to be a problem in the workplace for 10 years, considering she's gotten laid off so many times?

Speaker 14 Or is it

Speaker 14 good?

Speaker 1 She's good in her role and everything. Well,

Speaker 26 my sister passed away, and after that,

Speaker 27 she left work for a while.

Speaker 26 And then when she came back, all of the

Speaker 27 other admin ladies were younger, faster.

Speaker 14 I gotcha. Okay.

Speaker 1 Okay. Yep.
Now that makes sense.

Speaker 1 I got you.

Speaker 26 And we don't have any property in our family. Like, she doesn't own a home.

Speaker 28 She's renting right now. And the rent is

Speaker 26 a little bit higher than, I mean, it's like $1,400.

Speaker 1 Yeah, it's a lot.

Speaker 1 So I think you sit down, develop a plan with a good Smart Vestor Pro, and that will tell you what you're going to do. And it also will inform her.
I think she's working a while.

Speaker 1 And

Speaker 1 I think that, you know, I think it's good. I don't think that's bad.
There's nothing wrong with that. I'm getting ready to turn 65.
I plan on working.

Speaker 1 And not because I have to, but because I enjoy it. And so this is what I do.
And I don't really have anything else I want to do. So that's perfect.
So,

Speaker 1 you know, she's got that same situation. She gets to work with her son

Speaker 1 who's loving her and taking care of her and so forth. And so she can stay right there and earn an income.
And meanwhile, continually putting some money in.

Speaker 1 Meanwhile, investing this current money that she has better than it's invested now so that it'll produce more because

Speaker 1 it's probably not doing that well right now. So you do need to reorganize the money that she has.
And that's why I'm sending you to to a Smart Vestor Pro to help you figure every bit of that out.

Speaker 1 Virginia's in Pennsylvania. Hi, Virginia.
How are you?

Speaker 6 Fine, thanks.

Speaker 4 I'm a new listener.

Speaker 1 Okay. How can we help?

Speaker 6 Well, my question is: is it

Speaker 17 make financial sense for me to continue to be the co-owner on my 33-year-old unmarried son's financial account? No.

Speaker 17 I opened these up for him when he was an infant.

Speaker 7 Yeah.

Speaker 7 So.

Speaker 1 No, this is like a man,

Speaker 1 and he doesn't need his mommy on his account.

Speaker 21 I'm trying really, not that he's irresponsible, but I'm really trying hard to.

Speaker 1 Well, he's 33. If he's irresponsible, it's his problem.
He doesn't make a lot of money. I don't care.
So.

Speaker 25 Okay.

Speaker 1 No, I mean, really.

Speaker 1 You cannot carry a 33-year-old around and change his diaper, honey. I mean.

Speaker 1 I don't.

Speaker 8 I was always told there should be a co-owner on bank accounts.

Speaker 1 I'm sorry, say that again?

Speaker 17 I was always told there should be a co-owner. Who told you that?

Speaker 12 My parents.

Speaker 1 Oh, okay. That's shocking.

Speaker 1 Okay.

Speaker 1 No.

Speaker 1 Let me just tell you, Rachel's sitting beside me. She's my daughter.

Speaker 1 She's in her 30s. The number of bank accounts of hers that I'm on is precisely zero.

Speaker 1 Not even close.

Speaker 14 It's hard to let go, Virginia. That's a good boundary.

Speaker 1 It's a good boundary.

Speaker 14 He needs to fly and be free. And if he makes mistakes, he's going to have to learn it as a man.

Speaker 1 Goody.

Speaker 14 I'm glad you're a first-time listener, though. Glad you're here.

Speaker 14 Switching banks can be a hassle, and I totally get that. But when Wince and I opened up our Fairwinds account, we were shocked by how quick and easy it was.
It just took a few minutes online.

Speaker 14 We didn't have to block off an entire afternoon or track down paperwork. And the next day, we got a personal call from a Fairwinds specialist just checking in.

Speaker 14 I couldn't believe it when I answered my phone and I was talking to them. I was like, y'all are the nicest people.

Speaker 14 Now, if you're working hard to save money, get out of debt, and build a future, you should have a bank that supports that, not fights it. That's why I recommend Fairwinds.

Speaker 14 They created the smart checking and savings bundle specifically for Ramsey fans.

Speaker 14 Plus, they have a great app and you have access to over 33,000 fee-free ATMs and more than 5,000 shared credit union branches across the country.

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Speaker 14 Make sure you choose one that helps build you up and helps you win with money. Visit fairwinds.org/slash Ramsey and open your smart bundle today.
Fairwinds.org/slash Ramsey.

Speaker 30 Fairwinds.org slash Ramsey. Fairwinds is federally insured by the NCUA.

Speaker 1 If you like the show, thank you. We could use your help.
Click the follow button, the subscribe button, share the show, send somebody a link, click a share button if there's one on your platform.

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Brianna is in Texarkana, Texas. Hey, Brianna, what's up? Or Brianna?

Speaker 1 Is it Brianna or Brianna?

Speaker 9 I go by either, but it's Brianna.

Speaker 1 Brianna, okay.

Speaker 7 How are y'all today?

Speaker 1 Good. How can we help?

Speaker 31 I was giving y'all a call. We're kind of in a pickle.

Speaker 31 We're currently renting, and our landlord is selling the house.

Speaker 13 They gave us 30 days to move out.

Speaker 1 Okay.

Speaker 9 So we've got a couple of options.

Speaker 31 I'm in touch with contractors in the area because I work with them. We looked and uh saw a house yesterday that was $1,300 a month.

Speaker 25 For rent?

Speaker 21 Which is, yes.

Speaker 1 Okay. What are you paying now?

Speaker 1 $1,150. Okay, cool.
That's good. All right.

Speaker 31 Okay.

Speaker 31 We do have some debts right now.

Speaker 31 We have two cars that we are paying down a lot on and a discover card. So total in debt is about 25,000.

Speaker 1 Okay.

Speaker 9 So I've got two options.

Speaker 31 I can either

Speaker 31 start paying a little bit more in rent

Speaker 31 and you know push our we want to eventually build a house

Speaker 31 or

Speaker 31 we can my sister told me we could go ahead and get a camp

Speaker 31 loan out a camper

Speaker 31 and live on her property so we can rat hole a lot of money for a down payment on a house and start building.

Speaker 1 Take a loan and buy a camper.

Speaker 31 Well,

Speaker 31 I know.

Speaker 31 Take a loan out for a camper.

Speaker 1 Yeah, I got it. You just said that out loud.

Speaker 1 Yeah.

Speaker 1 Well,

Speaker 1 I know.

Speaker 1 Oh, no.

Speaker 1 Yeah.

Speaker 1 So, no, we're not going to finance something that's going down in value while we're trying to get out of debt to save up money to buy a house. It's working against you.

Speaker 1 You're swimming upstream.

Speaker 1 Not only is it going down in value, but you're paying interest for it to go down in value.

Speaker 1 Right?

Speaker 1 Oh, and by the way, you're living in a camper. There's that, too.

Speaker 1 Yeah.

Speaker 1 Yeah. I'd go rent that $1,300 house in about the next 30 minutes before it gets away.

Speaker 14 It's okay. What's your hesitation, Brianna? I'm just curious.
Is it that?

Speaker 1 I guess it's just

Speaker 1 like you're throwing money away, renting.

Speaker 10 Yeah, in a sense, yeah.

Speaker 14 Okay, the two, what do you guys owe on the two cars?

Speaker 31 I was $17 on one and then $4,600 on the other.

Speaker 1 Okay.

Speaker 1 What's your household? Yeah, what do y'all make?

Speaker 31 Last year we did $125.

Speaker 1 Okay. Oh, that's great.
So you should be able to clean this up in a year.

Speaker 1 You beat that free in a year.

Speaker 1 Yeah. And also.
No, no, no, no, wait a minute. No,

Speaker 1 you said that like you didn't believe it. I believe it.
You made $125,000. You only owe $25,000.
Your rent's only $1,300. You should be dead-free in a year.
You're not on a detailed budget.

Speaker 1 Y'all are still going out to eat and partying.

Speaker 11 Yeah, we started doing the Every Dollar app as well.

Speaker 1 Last week.

Speaker 1 Right?

Speaker 1 You're just getting started, kiddo. Hey, listen, don't worry about the every dollar app.
But if you were organized, think about this.

Speaker 1 If you make $125,000 and you pay off $25,000, that means you have to live on $100,000. Oh, my.

Speaker 1 Yeah. You could do that.

Speaker 7 Okay.

Speaker 1 Your cars are not out of control.

Speaker 1 They're not good. I want you to get them paid off.
The $17,000 is concerning, but you make good money.

Speaker 14 Yeah, what do y'all bring home every month? Do you know after tax, what hits your bank account every month for income?

Speaker 31 Every month let me think I'm easily

Speaker 1 $1,700 every two weeks and he's at like $1,500 every two weeks $6,400 yeah okay something's wrong you guys got a big tax refund didn't you

Speaker 1 well not it was about two thousand okay and and how much is coming out for 401ks

Speaker 31 6% out of mine so 100 and

Speaker 14 yeah so stop that yeah and that pays for the the difference of the rent.

Speaker 31 And we do have

Speaker 31 an 18-month-old, so she's in daycare.

Speaker 1 Yeah, but that's not causing you to be broke. You're making plenty of money.

Speaker 1 Okay. So here's the thing.
Here's what I want you to do.

Speaker 1 In talking to you for a few minutes,

Speaker 1 you make too much money, and you're too smart. to be this broke.

Speaker 1 Okay? Because if I run into somebody that's either dumb or they don't make enough money, I can't fix the dumb, but I can help if they don't make enough money. You're not either one.

Speaker 1 You're smart enough to do this, and you are not, and you make plenty of money. So here's what I want you to do.

Speaker 1 I want you to pretend like I hired you for $130,000 a year to take over Brianna's budget and make it behave. Make every one of those dollars scream like it was your job.

Speaker 1 And if you didn't do your job, you were going to get fired.

Speaker 1 And that's the every dollar budget. I'm going to take every one of those dollars that's coming in.
I'm going to stop the 401k temporarily.

Speaker 1 I'm going to adjust my take-home pay by another $200 a month so that you don't get a tax refund.

Speaker 1 And that's the $2,000 because a tax refund means you gave Washington too much money and then they gave it back to you in April. Santa Claus does not live in D.C.

Speaker 1 That was your money you got back. And so you lay all of that out and you make those adjustments and then you take the money that's coming in, which is now about $7,000 a month.

Speaker 1 You pay $1,300 out of it. You buy some food.
You buy some daycare. You put the electric bill on there.
And then you got some money to attack this. And you run the ringer on this debt, kiddo.

Speaker 1 And don't be talking about living in a camper. You make $140,000 a year.
Let's get this done.

Speaker 1 Okay. You can do this.

Speaker 31 We have paid off a lot, like easily $20,000 this past year.

Speaker 1 Good. Okay.
That's great.

Speaker 1 If you did it one more year plus a little, you're done.

Speaker 31 Because the cars we originally started with sixteen hundred on it was sixteen thousand on my highlander and nine thousand on his car and we've paid it that's great brianna what's the discover hey what's the discover card how much do you guys owe on that

Speaker 14 eighteen thousand eighteen thousand okay

Speaker 1 is that cut up

Speaker 1 oh yeah it's gone okay good all right so you discovered you discovered freedom good i'm glad yeah all right hey get on that every dollar budget We're going to put you in with Kelly.

Speaker 1 She's going to give you the upgrade where it connects to your bank and you can drag and drop everything automatically. And

Speaker 1 it's going to change everything. It's going to show you exactly how to walk these baby steps.
And I want you to step on this money like it was your job.

Speaker 14 Yeah, get the $2,600 car paid off this month. Yeah.

Speaker 14 Find $2,600 out of that budget and do it. Like extreme stuff.
And this is extreme. Like the grocery budget, your shopping.
Yeah. And expensive.

Speaker 1 No eating out. And no vacations.

Speaker 1 And no campers.

Speaker 1 No campers.

Speaker 1 No, no, no. That's going to set you back.
It's going to cost you a year and a half to two years in this. Don't do that.
No, your sister's sweet. She's just not smart.
Don't do this. No.

Speaker 1 She was generous to let you live there. I shouldn't say that, but

Speaker 1 that was nice. But no, if it led to

Speaker 1 her suggesting financing a camper, then I'm not going to. No, that's dumb.
Don't do that. Don't do that.
Go get that other house.

Speaker 1 You're going to be there two years because it's going to take a year to get out of debt, build your emergency fund, then you got to build a down payment. You might be there three, but that's it.

Speaker 1 After that, you're going to buy a house. Yep.

Speaker 1 And then you're going to move on and become wealthy. This is what you're going to do because you make too much money and you're too smart to be this broke.

Speaker 1 So you're heading out. You're doing good stuff.
Keep it up. Keep it up.
Keep it up. We're here to help you.
And we're going to hold you accountable. Hang on.
Kelly's going to pick up.

Speaker 1 We'll get you tied into that every dollar app.

Speaker 1 It's interesting.

Speaker 1 That's interesting.

Speaker 14 The camper? What's interesting?

Speaker 1 Yeah, I just try to think what

Speaker 1 mindset is.

Speaker 14 Well, because it feels like rents, I could see it.

Speaker 14 It feels like you're throwing money away and at least you have an asset, but understanding the asset ends up sometimes being underwater. It's like a car.

Speaker 14 Like you borrow at the high end, and when you try to sell it, it's not it, you can't even recoup it. So

Speaker 14 it's just, yeah, more details and research in it, Brianna. But good luck to you guys.

Speaker 1 Good question. Thanks for calling in.

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Speaker 1 Welcome back to the Ramsey Show. Rachel Cruz, Ramsey personality, number one best-selling author.
My daughter is my co-host today. Open phones at 888-825-5225.
Amanda is in Wisconsin. Hi, Amanda.

Speaker 1 How are you?

Speaker 23 I'm doing great, Dave. Thank you for taking my call.
And Rachel, it's awesome to speak with you as well.

Speaker 14 Oh, well, we're glad you called, Amanda.

Speaker 1 Happy to talk.

Speaker 23 Thank you.

Speaker 23 Currently, my husband and I, with our four children, we are on baby step number three.

Speaker 23 And we've currently paid off about $125,000.

Speaker 1 Oh, my gosh, congratulations.

Speaker 23 Yeah,

Speaker 21 it's been a lot of work. But

Speaker 23 right now that we have more wiggle room in the budget, we're struggling with momentum of trying to get that full on emergency fund filled up.

Speaker 23 And part of it has to do with we had a couple of emergencies this past year that weren't life threatening, but they are big financial burdens that we are struggling to throw that money at it to save up to that large amount versus when we were paying down our debts, you know, it was easy, you know, throwing like you know, three, five hundred, you know, at a things at a time per month and watching that steadily go down.

Speaker 23 But we're just kind of struggling with the momentum of needing to get that emergency fund up so we can keep going forward.

Speaker 14 How much do you guys have in the account now?

Speaker 23 6,000.

Speaker 1 Okay.

Speaker 14 And your ideal number that you guys are shooting for?

Speaker 23 $30,000.

Speaker 1 30,000. That's three to six months of expenses?

Speaker 23 No, that's just at least like a couple of months right now.

Speaker 1 No, I'm saying $30,000 is 3 to 6 months of expenses. What's your household income?

Speaker 24 Last year we had $110,000.

Speaker 24 Okay.

Speaker 24 All right.

Speaker 1 Okay. It's pretty hefty.

Speaker 1 That may be part of the problem. You may have such a big goal, you can't see getting there.
And you're throwing how much at it a month to build it? Or how much can you throw it?

Speaker 23 Right now, we're throwing about 500 a month.

Speaker 1 You didn't get out of debt at that speed.

Speaker 23 No, we didn't. And that's where.

Speaker 1 What were you throwing at it? What were you throwing at the debt a month?

Speaker 23 Oh, gosh, like a couple thousand.

Speaker 1 Yeah. Yeah, at least.

Speaker 1 Listen, baby steps one through three

Speaker 1 are gazelle intensity, like your hair is on fire, scorched earth, no eating out, no relaxing total focus zero lifestyle no vacations till you get that emergency fund built so it's two thousand dollars a month going in there which is a 15 month schedule from the beginning but you're six thousand in and so it's a 12 month schedule for you to get there

Speaker 1 but you've got it i mean you've got to lay it out and look at it like that what happened was is y'all got out of debt and relaxed

Speaker 1 yeah guilty you didn't you didn't keep your intensity through this Once you get the baby steps done, baby step three done, then you can relax and start 15%, be intentional instead of intense.

Speaker 1 Put 15% of your income into retirement, then start towards the kids' college and those kinds of things.

Speaker 14 Yeah, what does it take a month to run your household, Amanda?

Speaker 7 It takes about $3,700 and change.

Speaker 1 Okay, so let's call that $4,000. So three months is $12,000, $24 is 6 months.
So I don't know if you need $30 or not.

Speaker 1 yeah you could go yeah you could you could call it 20 for now just and just go get it finished that's 14 that's seven months at two thousand dollars a month yeah

Speaker 14 okay that probably feels more doable

Speaker 1 yeah

Speaker 1 five hundred dollars a month you're gonna get there in about 18 years no you can't no wonder you lost momentum

Speaker 22 yeah i we

Speaker 23 Last year, one of our vehicles that we had paid off, the motor

Speaker 23 decided to die. And after crunching it, it's just cheaper to put a new motor in, which is going to be about 10 grand.

Speaker 24 We have a second vehicle that, again, everything's paid off that we're using, but it would be good to have the actual truck back on the road.

Speaker 23 And then we had a huge flood and the furnace died. So we're heating our house with a total stove, but we need a new furnace, which is like another 10,000.

Speaker 1 And I think that's probably where that 30,000 came from. Yeah, you feel overwhelmed for sure.
Yeah, you got to take care of those things.

Speaker 1 So you may want to go with a used motor from a junkyard into the truck rather than a new one.

Speaker 23 Yeah, it's it we've been through like multiple mechanics. It's one of those situations where it's a known issue with the vehicle like around the

Speaker 23 180,000 mile mark. Didn't know that when we bought her.
But, you know,

Speaker 23 even if it's a used or refurbished motor, it's still around like the lowest was like 8,000.

Speaker 1 Yeah. Yeah.
Okay. But I mean, yeah, you're going to have to clear those and plow through this.
Thank God you're out of debt. Yeah.

Speaker 23 You know, it's painful watching the beagle sit there and, you know, and the furnace.

Speaker 23 And it's like, and it just felt like, oh, gosh, we lost our momentum because we were starting to save up for the emergency fund.

Speaker 21 And I'm like, how do we get the momentum back?

Speaker 1 Yeah. Well, I mean, it's saying, okay,

Speaker 1 thank God, okay, with the same intensity that you use to get out of debt. And thank God I was out of debt.
Because if I wasn't, I'd be really screwed right now.

Speaker 14 With all those payments going on.

Speaker 1 And so then you're going to be the other side of this and you're going to go, okay, I got the furnace, the car fixed. I get the emergency fund done.

Speaker 1 And thank God I'm in that position because then something else is going to come up. 100% of us have things happen.

Speaker 14 Well, and the hard thing is, too, I think we can kind of all live a little bit in a fantasy world that life's trajectory is just straight up. And it's not.
It goes up and down.

Speaker 14 You know, the trajectory is going up, but there's going to be ups and down seasons.

Speaker 14 Like we've talked to many people that they were on, you know, baby step three and almost complete and then something happens and they got to drain it and build it back up. I mean, that, that is life.

Speaker 14 But But the encouraging thing is, I mean, that you guys have a plan. Number one, you know what you're doing, and just take it one bite at a time.

Speaker 14 When you look at the whole thing, it can feel overwhelming of like, oh my gosh, we still have to get 20,000 in the emergency fund, and we have this 10,000 and this 10,000.

Speaker 14 Just do one thing at a time and look at the numbers of it to know: okay, if we really sacrifice and keep at it, we can put 2,000 away a month, 1,500 away a month. And you just start building on that.

Speaker 14 And then also, you think about too, your jobs, you know,

Speaker 14 getting raises, like things happen too with income throughout this process.

Speaker 1 The good news is the other side of it, and the other side of it looks like this: when you don't have any payments, the truck is fixed, and the furnace is fixed, and you got $20,000 in the bank.

Speaker 1 It's going to be the weirdest thing. Here's the weirdest thing that happens: what is defined as an emergency changes?

Speaker 1 Because when you're broke,

Speaker 1 a $30 item is an emergency.

Speaker 1 When you're doing really well and you got margin in your budget, a $1,000 item is not an emergency because you just put it in the budget.

Speaker 1 And even later on, it gets to where a $10,000 item is not an emergency as you build some wealth. And you just don't end up using the emergency fund because

Speaker 1 you're starting to get margin in your life. And by the way, you're moving up in a little bit better cars so they're not breaking all the freaking time.

Speaker 1 And you're staying ahead of the maintenance stuff on stuff so it doesn't break on you.

Speaker 1 And you get more life out of things because you keep up with it, all that. So the good news, and I'm talking three years from now for you, Amanda, not today.

Speaker 1 Today, you've got another year of really tough. Roll up your sleeves.
You've got a year of tough.

Speaker 1 And you're not done. You're not done.
You've got to get through this.

Speaker 1 But that's the only way to get through it is to bust through it. And as you said, to regain your momentum.

Speaker 1 There's not a magic thing, but when you set a clear goal and you believe it's reachable, it gives you energy.

Speaker 1 When it's a vague series of things attacking me that I don't know how I'm going to handle, it steals your energy. So break it down step by step.
Here's what we're going to do first.

Speaker 1 Here's what we're going to do second. Here's what we're going to do third.
And we're going to crank it up again. No lifestyle, no nothing, till we get this mess cleaned up.

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Speaker 1 Don't like that.

Speaker 18 And just a year ago, get this. The average person had about 300 pieces of personal data floating around online.
Now it's over 600. It has doubled in a year.

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Speaker 1 Exactly.

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And that discount brings their annual plans down to about nine bucks a month. So go check it out.
JoindeleteMe.com slash Ramsey.

Speaker 1 Amy's in Minnesota. Hi, Amy.
How are you? I'm good. How are you guys doing? Better than I deserve.
What's up?

Speaker 15 Well, I wanted to call and ask about my company credit card. My husband and I have worked really hard to pay off all of our debt,

Speaker 15 and we have our emergency funds saved, and we've been also saving to buy our first house sometime in this year.

Speaker 15 We went to our local credit union to get approved, and we did get approved for a loan, but the person that we spoke with there

Speaker 15 asked me about a $17,000 debt that was showing on my credit report, and I realized it was for my company-issued credit card.

Speaker 15 I'm a secretary in an accounting firm and I was given this card when I first started working here and I use it to book travel for employees, order office supplies, pay different company bills, but it never occurred to me that it would show on my personal report.

Speaker 1 So is it an American Express?

Speaker 22 No.

Speaker 1 Good. Okay.

Speaker 1 Because theirs are going to show on your report and they're going to try to hold you liable. So I would go to your supervisor and tell them you need this canceled immediately.

Speaker 1 Okay. This is ridiculous.
It should not be on your report.

Speaker 1 Did you sign to be liable for this company?

Speaker 1 No.

Speaker 15 And from what I was reading, you know, we're a smaller company, so I'm like listed as an authorized user.

Speaker 1 The authorized user is not liable for the bill.

Speaker 21 Yeah, so that's why I'm not sure.

Speaker 1 So it shouldn't show up on the credit bureau. But your bank is a huckster, so your boss's bank is a huckster, so you need to get away from this.

Speaker 15 Okay, I was, yeah, I wasn't sure if I was getting the right information from the credit card or from the credit union person we talked to about the loan.

Speaker 1 Well, if it shows up on your credit bureau, it's not something they've taken your social security number and put you on the account somehow.

Speaker 12 Yeah, yeah, I'm an authorized user.

Speaker 1 I know, authorized user is not liable, but that doesn't, should not be reported. Sometimes they do that, though.
And so,

Speaker 1 yeah, you've got to be really, really careful. And so I would just tell your boss just to, you know, to shut it down, shut down the account or shut your name down off the account.

Speaker 1 I don't want to be on the account at all in any way. If you want me to book your travel and stuff, you're going to have to give me your card to do it.

Speaker 1 I'm not putting my name on it.

Speaker 1 Okay.

Speaker 1 Okay.

Speaker 1 Well, I will do that. I appreciate it.
I don't want to be liable for it. And I don't want it reported on my credit bureau.
Yeah. I worked hard to get out of debt.

Speaker 1 Now I got a $17,000 debt that's yours on my credit report.

Speaker 14 That's what parents are starting to do with their kids, putting their kids as authorized users so that it builds their credit, which is that same whole

Speaker 1 crap. And it's not supposed to show up.
Yeah. It's not legal, but they do it all the time.
So,

Speaker 1 because here's the thing. What is reported on your credit bureau report is what you

Speaker 1 owe.

Speaker 1 When you're an authorized user, you don't owe anything.

Speaker 14 Your name is just attached.

Speaker 1 Should not be on that.

Speaker 14 It's just that her name is attached to an account that does owe.

Speaker 1 Yeah, exactly. But it's the same thing as the kids.

Speaker 1 It's exactly why she's getting this. She's probably not liable on this account.
They probably haven't screwed it up.

Speaker 1 But the best thing to do is just to get it out of her name completely, and then you don't have to worry about it. That's right.
It's not going to show up anymore. God,

Speaker 14 how crazy is that? That you're like, we're out of debt, all this. And you go to your credit union and you're like, I'm sorry.

Speaker 1 You got $17,000. What? We can prove the loan in spite of that.

Speaker 1 And he acts like she owes the money. See how that happened? Yeah.
See how that looks? That's the purpose of a credit bureau report, but it's false. Right, right.

Speaker 1 You know,

Speaker 1 these companies, man.

Speaker 1 Snakes. Kathleen is in Kansas.
Hi, Kathleen. How are you?

Speaker 4 Hey, Dave. I'm good.
How are you doing?

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

Speaker 2 Thanks for taking my call.

Speaker 9 So pretty straightforward question. My boyfriend and I are going to be buying a house together.
And my question is, should I keep the townhome that I currently own and rent it out for extra income?

Speaker 3 Or should I sell it, take the profit, and stick it in investments?

Speaker 1 Kathleen, you're not going to like me.

Speaker 3 You're going to ask why we're not married.

Speaker 27 No.

Speaker 1 Maybe that too.

Speaker 1 Well, that might come up in a minute, but we're going to start with the idea that buying a home with someone that you're not married to is financial freaking suicide. Do not do that.

Speaker 4 Okay.

Speaker 1 One of you decides to leave. You can't get off the mortgage.

Speaker 14 There's no protection.

Speaker 1 One of you gets disabled. You can't get off the mall.

Speaker 1 If he dies and he doesn't have a will,

Speaker 1 if he dies and he doesn't have a will, you own a townhouse with his mother.

Speaker 1 Yeah.

Speaker 1 It's a bad idea.

Speaker 1 It's a bad idea. Okay.

Speaker 1 These are the people that call us later

Speaker 1 after they do the thing you're going to do. And then they call us going, Dave, I'm so screwed.
What am I going to do now? Please don't do it.

Speaker 14 Or the boyfriend leaves and stops paying.

Speaker 1 He just disappears.

Speaker 1 And then you're on on the hook for the whole thing or you're gonna get foreclosed on or you know what i mean like it's just it's not not good no no no no do not do this now then then and then if you were married and you did and you did buy it together that would be okay obviously uh so if you're gonna do this you got to get married um

Speaker 1 uh so i'm really meddling now but the uh but then if you're gonna do this you'd have to keep debt on one or the other in order to keep the old place and i wouldn't do that i'd sell the old place Okay.

Speaker 1 But don't sell the old place and buy this with your boyfriend.

Speaker 1 You're going to do it anyway. Yes, she's.
You're going to do it anyway. You're how I stay in business.

Speaker 1 You're just going to keep coming back.

Speaker 1 She's going to do it anyway. Everyone listening knows it.
Oh, bless your heart, darling. I'm so sorry.
Please don't do this. Please, we love you.
We don't want this. We're here, Kathleen.

Speaker 1 If it goes to the bottom, it's not a prosperity plan. It's a poor person plan.
You're going to be poor people. Don't do this.
Don't do this. Please don't do this.
It's not a matter of romance.

Speaker 1 It's a matter of stupidity. Tim is in Utah.
Hey, Tim, what's up?

Speaker 21 Hey, Dave. Quick question.

Speaker 33 So, my wife and I, we're self-employed.

Speaker 21 We own a business.

Speaker 33 And

Speaker 33 we currently own a house in Utah that we bought in May of 2022. Long story short, our house has dropped in value like $85,000.

Speaker 1 Why?

Speaker 21 So

Speaker 33 the market just dropped. We bought the week before interest rates started going up.
And so then interest rates went up and we have

Speaker 1 salt.

Speaker 33 Just south of Salt Lake.

Speaker 1 Bull.

Speaker 1 Salt Lake is a boom town. It's exploding in price.
It's almost unbearably expensive.

Speaker 33 It is. It's still expensive.
Our house was expensive, but

Speaker 33 the value has gone down quite a bit

Speaker 33 since we bought.

Speaker 1 I'm sorry. I don't believe you.

Speaker 1 I think you've got bad information.

Speaker 1 who gave you the comps.

Speaker 1 Who gave you the comps?

Speaker 11 Our realtor works for

Speaker 1 your real estate agent came out and looked at the house and said the house that you bought in 21 is worth $85,000 less in Salt Lake City.

Speaker 21 Yeah.

Speaker 33 And we have friends that just sold under contract and their house is undervalue.

Speaker 33 Yeah.

Speaker 33 Yep.

Speaker 7 So

Speaker 33 here's my question, though.

Speaker 21 So

Speaker 33 we don't have any other debt. Like we're pretty smart financially, but we don't like how much our mortgage is.
And the other aspect is we travel to the East Coast for work six or seven times a year.

Speaker 33 And so we're looking at buying a house in the East Coast by some friends, and we'd be able to lower our mortgage payment about $1,200 a month.

Speaker 1 Six or seven times a year?

Speaker 25 Yeah.

Speaker 1 For how long at a time?

Speaker 14 How long at a time?

Speaker 33 About a week at a time.

Speaker 1 So for seven weeks out of the city. So six weeks out of 52.

Speaker 1 That doesn't determine your domicile.

Speaker 21 Well,

Speaker 33 no, but if we moved to where we're looking at, our mortgage payment would also be $1,200 a month.

Speaker 1 Oh, you would never. But you'd never live there.

Speaker 14 No, but you're moving there full-time, you're saying.

Speaker 1 No, no, no.

Speaker 21 We're talking about selling our house in Utah and moving.

Speaker 14 And moving to the East Coast.

Speaker 1 The whole year. Yes.

Speaker 25 Yes.

Speaker 1 Yes, yes, yes. So what's the six or seven times got to do with it?

Speaker 1 That's just the reason why they're moving.

Speaker 33 He doesn't like traveling as much.

Speaker 1 He just wants to live on it.

Speaker 1 So are you working in Salt Lake City while you live on the East Coast?

Speaker 11 We own a company.

Speaker 11 We work remote.

Speaker 33 So we can work anywhere.

Speaker 21 So

Speaker 33 my question was, though, for us to move, to sell our house, we'd owe our mortgage company a little bit.

Speaker 33 And then moving costs and closing costs and everything, it would cost us probably about $40,000, which we have in the bank, to move.

Speaker 33 And it'd only save us about $1,200 a month in payment and mortgage payment.

Speaker 1 It doesn't make any sense at all.

Speaker 33 We're trying to decide.

Speaker 1 No, it doesn't make any sense at all.

Speaker 33 We're trying to decide: should we just take that 40 grand and put it towards our house? That's the only debt we have.

Speaker 1 I would just sit there and let the thing come back in value. You got no reason to move.

Speaker 1 You don't have no reason to move.

Speaker 1 You're only over there six times a year. You can get a hotel six times a year.
Or nothing. I mean, it's nothing to do with it.

Speaker 14 So wait till the house gets to be a little bit more.

Speaker 1 You're going to go $85,000 and $40,000 to move.

Speaker 1 So there's $120,000 swing. You'll never recoup.

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Speaker 1 Salt Lake City is the 10th hottest real estate market in 2025 in the U.S.

Speaker 1 It's up 9%

Speaker 1 year over year

Speaker 1 in prices, and it is 35% higher than the national average on median house prices. It's essential.
Just to make sure. Just a classic Ramsey move.

Speaker 1 No, I'm serious.

Speaker 1 I am too.

Speaker 14 This is exactly what happens when we debate at dinner as a family. We're always pulling up Google to prove our point.

Speaker 1 Well, I mean, it wasn't like I made this up. That was my point.

Speaker 14 I know, I know, but you proved it.

Speaker 1 I did. Proved it.
Did.

Speaker 1 Lock that down.

Speaker 1 Christy's in Indiana. Hey, Christy, what's up?

Speaker 7 Hey.

Speaker 2 So

Speaker 2 a lot's happened over the past year with my family. Me and my husband have been married for about 14 years, and we're deciding to

Speaker 2 move because of his job from Indiana to D.C.

Speaker 2 And we're deciding to consolidate my mother's house also and move her in with us. She owns her house outright.

Speaker 2 We still carry a mortgage, but I'm just trying to figure out how to protect her money in this whole process if something were to happen.

Speaker 2 Divorce, death, what may, I just have no clue how to walk into joining our household and making that happen.

Speaker 1 Why are you?

Speaker 2 I'm the only child that looks out for her.

Speaker 9 So her husband had a stroke a year ago.

Speaker 2 He's in a facility.

Speaker 2 He's like a three-year-old in a grown man's body.

Speaker 2 She lived with my 92-year-old grandma, who passed away about two weeks ago.

Speaker 1 Oh, I'm sorry. So

Speaker 5 there's just no one here.

Speaker 1 How old is your mom?

Speaker 29 I'm 72.

Speaker 1 Okay. So why does she need care at 72?

Speaker 2 She just doesn't get around good.

Speaker 2 She uses a walker, probably could use a wheelchair at this point.

Speaker 2 She was looking into a townhome here, and

Speaker 1 I'm like, well, that doesn't make sense if you got a wheelchair in your future with a walker.

Speaker 2 Yes, I know, I know. And, you know, there's, you know, there's some family close, and I said, if she needed help, would you help her? You know, right now she lives on an acre.

Speaker 32 She has a like a seven or eight bedroom house.

Speaker 2 It's just too much. So we've been.

Speaker 1 I don't doubt that, but I don't. What I'm trying to figure out is why she's moving in with you.

Speaker 2 Because I have a conscience.

Speaker 1 No.

Speaker 1 That's not.

Speaker 1 She doesn't even need you. I mean,

Speaker 1 she's only 72.

Speaker 14 But she doesn't sound like she's in great health.

Speaker 2 Yeah, she's not. She does need us.

Speaker 1 She does need us. All right.

Speaker 1 All right.

Speaker 3 I don't know why.

Speaker 2 She panics, you know, even

Speaker 32 she had help with her husband.

Speaker 1 How many brothers and sisters do you have?

Speaker 2 I have

Speaker 2 one sister.

Speaker 2 I have a brother also, but we haven't seen him in the middle of the year.

Speaker 1 So what's the house she's going to sell? How much money is she going to put into this deal?

Speaker 2 Probably maybe $700,000. And I have some other cash things that were moved around, annuities and stuff.

Speaker 2 We had hired prior to all of this going down, we had hired an estate lawyer when her husband had a stroke.

Speaker 1 Yeah, yeah.

Speaker 2 And they moved some of her money around so that she wouldn't lose it.

Speaker 1 Why would she lose it?

Speaker 1 Applying for Medicaid, they she put him in a welfare nursing home and she has $700,000?

Speaker 2 Well, no, that's going to be what we're going to get from the house because she owns the house outright. And that's something they said that the government wouldn't take with her.

Speaker 1 I know, but this is Medicaid. This is Medicaid is welfare.

Speaker 1 She put him in a welfare nursing home.

Speaker 1 Wow.

Speaker 1 And she had the money to not do that.

Speaker 2 No, we used all of our cash assets initially, and he was not in there for about a year.

Speaker 1 Okay, so she's broke other than the house.

Speaker 36 Yes.

Speaker 1 Okay. Does she have any income?

Speaker 2 Other than what she gets from Social Security now. Okay.

Speaker 1 What's your house?

Speaker 1 What's this proposed purchase going to cost?

Speaker 2 We actually made a h offer on a house

Speaker 11 for

Speaker 9 a little over a million.

Speaker 1 Okay, you need to see an estate planning attorney, and the house would be purchased in an LLC,

Speaker 1 and

Speaker 1 she owns a portion of the LLC,

Speaker 1 and you own a portion of the LLC.

Speaker 1 Okay, and then here's the tricky part. You have to do a bunch of legal work to determine what happens to her portion of the LLC upon disability or death.

Speaker 1 Or if you guys just want to sell.

Speaker 1 Because otherwise you're going to get trapped and your siblings are going to be pissed and your brother will just reappear at the most inopportune moment.

Speaker 1 Looking for his part of the 700K that is called your house.

Speaker 1 This is really messy.

Speaker 1 It's going to be very difficult to do this well and it not end poorly. That's why I was asking all these questions about her care.
Okay.

Speaker 1 It'd be one thing if she just moved in with you and you took care of her. But when you put her money in this house, she's now your partner, she's 72 and she's in ill health and she dies.

Speaker 1 Is that going to force the sale of the house that you live in in order to give your sister her part of the inheritance?

Speaker 14 Are you going to save the money to buy her out?

Speaker 1 Yeah. You're going to have $350,000, or is it going to be $350,000 plus what the house has gone up in value? So now the house is worth $2 million, and your mother's share is now worth $1.4 million.

Speaker 1 And that means you owe your sister $700,000.

Speaker 1 This is not going to go well if y'all aren't real careful.

Speaker 2 She was planning on giving the whole portion to us. Her initial offer.

Speaker 1 Now, how's your sister feel about that?

Speaker 10 She doesn't

Speaker 2 want to take care of help her out.

Speaker 1 She doesn't want to help her out. 700 grand worth?

Speaker 1 Yeah. Yeah, this isn't going to go well.

Speaker 1 Okay. You guys are,

Speaker 1 you know, you haven't thought this all the way through.

Speaker 1 And so it can be done, but you're going to have to lay out every possible negative scenario and have in writing in the LLC documentation what's going to occur.

Speaker 1 Your mother gets dementia. Your sister says that you are signing checks illegally for her.
Who's got health care power of attorney? What happens in the event of death?

Speaker 1 At what point do you have to liquidate to pay your sister out? What does the will say about your mother's portion of the LLC? Because she owns over 50% of the house you live in.

Speaker 1 And

Speaker 1 that tail is going to wag that dog.

Speaker 1 You following all this?

Speaker 2 Yes.

Speaker 1 It's messy.

Speaker 1 That's why I was begging you to try to figure out a way to not do it. And I wasn't being incompassion.
Are you incompassion?

Speaker 14 Are you married, Christy, with kids and stuff?

Speaker 36 Yes.

Speaker 1 Okay.

Speaker 25 Yes.

Speaker 2 So here would be a question for me.

Speaker 4 Because

Speaker 21 this is sort of what she did.

Speaker 2 The house she lives in now, my grandma did the same exact thing. Sold her house, built onto my mom's,

Speaker 2 and they didn't have any paperwork.

Speaker 1 So

Speaker 1 you didn't have any heirs that questioned it.

Speaker 2 Well, you know, she did just pass away two weeks ago, but they knew that that was sort of like the cost of taking care of my grandma and letting her live there.

Speaker 1 Does your mother have any siblings?

Speaker 36 Yes.

Speaker 1 And that was your grandmother's house?

Speaker 2 Not technically, no.

Speaker 1 Whose name is it in?

Speaker 2 My mother's.

Speaker 1 You sure?

Speaker 2 Yes, because she she built it in 1974.

Speaker 2 Okay. They just remodeled it.

Speaker 1 Well, if your mother puts all of this money in this house and this house is in your name 100%, you've duplicated that family mess. But yeah,

Speaker 1 that'll work. It'll keep your sister out of it.
But I think your sister's probably never going to speak to you again when this is over.

Speaker 1 Because you took $700,000 to care for an elderly lady for a few years. It's pretty heavy pay.
A lot different than the Medicaid nursing home she put her husband in.

Speaker 1 So, man,

Speaker 1 this is messy. Your sister's going to be pissed.

Speaker 1 I can see it coming a mile away. I'm going to get a call from her.
That's what's coming next.

Speaker 1 Y'all got to work this through, and everybody's got to talk about it, and it's got to be documented, and you need some legal advice. It's a lot better than I could give you.

Speaker 1 Because all I can tell you is it's going to be a dead gum mess.

Speaker 1 The Ramsey Show question of the day is brought to you by YReFi. Defaulted private student loans can wreck your peace of mind, your finances, your relationships.

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Speaker 14 Today's question comes from Alexandria in Texas. I'm currently going through a divorce and recently found out that that my husband has taken out credit cards in our children's name.

Speaker 14 He racked up a significant amount of debt and emptied his retirement account to pay it off.

Speaker 14 He keeps telling me it's not possible to pull credit reports on our kids, but I don't believe that that's true because now he wants me to sign paperwork that absolves him from any wrongdoing regarding our kids.

Speaker 1 No good.

Speaker 1 Not happening.

Speaker 1 Your husband is scum.

Speaker 1 Anybody that would

Speaker 1 screw his own kids over is scum. I mean, who takes out, that's just absolutely the, I mean, to start with, identity theft is illegal.

Speaker 1 It's criminal fraud. Okay.
So your husband is a criminal. Oh, and who'd he steal from? His children.
What a jerk.

Speaker 1 No, I am not signing any paperwork except paperwork puts him in jail.

Speaker 1 That's the paperwork we're signing on him. So, no, go talk to your lawyer, darling,

Speaker 1 and tell your lawyer to send him back a little note that says LO, LO, LO, LO, LO, LO, LO, LOL. L-O L.
Got to be L-O-L.

Speaker 1 Kidding me.

Speaker 14 You're saying L-L-O-L-O-L.

Speaker 1 Yeah, whatever.

Speaker 1 I know, but it's laugh out loud, you fool. Okay, so you have got to be kidding me.
Oh.

Speaker 1 Yeah.

Speaker 14 And you can freeze your kids,

Speaker 1 which is

Speaker 1 credit reports and you can freeze them. We know this because we did it.

Speaker 1 When they first started allowing freezing, Rachel was still a minor. And all of our children entered their adult life with a frozen credit report.
Nothing had ever been on it.

Speaker 1 Nothing could get on it.

Speaker 14 Well, and you do it too to protect them from ID theft, just in general, like with their internet. You know, the internet and the city.

Speaker 1 They need to freeze it because their father is scum.

Speaker 1 Okay, well, and that will keep him from, if they actually check the credit before they issue the credit card, they won't issue it if it's frozen next time he tries to do this because there will be a next time.

Speaker 1 This guy is a serious con artist.

Speaker 14 I'm sorry. Man.

Speaker 1 Alexandria. Okay, here this is interesting.
Listen to the verbiage. He keeps telling me it's not possible to put credit reports on our kids, but I don't believe that's true.

Speaker 1 So here's, let me help you with this. Anything this guy says is not true.
If his mouth is moving, he's lying. This is a guy who would steal his own children's identity for his own personal benefit.
So

Speaker 1 nothing that comes out of his mouth can be trusted. So the only thing that can be trusted are the actual facts and the behavior, not the verbal wishes.

Speaker 1 So, no, you can pull credit reports on your kids. You can freeze credit reports on your kids.
I have done it.

Speaker 14 And I would to make sure, I mean, if he says he paid it off, who knows? You know, so I would pull those credit reports to see what the status is for you.

Speaker 1 I would file a criminal on him. I'd have the police, I'd set him up and say, hey, somebody

Speaker 1 stole my kid's identity. Oh, it was him.

Speaker 1 Absolutely. And then let him figure that one out.
Definitely.

Speaker 1 Because I don't want this guy near them again. This is unbelievable.

Speaker 1 Carlo is in Miami. Hey, Carlo, what's up?

Speaker 37 Hi, I hope all you're doing well.

Speaker 1 We are. How can I?

Speaker 33 I wanted to ask your opinion.

Speaker 37 My mom, in February, late February, she passed away from her 10-year cancer battle. I'm sorry.

Speaker 1 And

Speaker 37 I appreciate it.

Speaker 37 And in her passing,

Speaker 37 big family

Speaker 37 squabbles with the scraps left behind. Long story short, I have $110,000 sitting in my bank account.

Speaker 37 My wife and I tomorrow are going to go get a biopsy for her.

Speaker 38 They think she possibly might have cancer.

Speaker 11 And her father that lives with us,

Speaker 37 his cancer came back, and we're dealing with that.

Speaker 1 Oh, my God! So,

Speaker 37 yeah, it's been a rough 2025, but

Speaker 37 we're still blessed to be here and making decisions and trying to make things better. So,

Speaker 1 my role.

Speaker 1 I assume you and your wife have health insurance, yes, sir. Yes,

Speaker 1 she works in the medical field. Does her father have health insurance? Yes, sir.
Okay, all right.

Speaker 37 So, um,

Speaker 37 my biggest, my biggest dilemma is this. I've always been a saver.

Speaker 37 I believe on babyside number five, if not six. We're doing rather well.
We just turned 40 this year.

Speaker 37 And I'm trying to balance

Speaker 37 keeping funds in the reserve for if things go south and living life now.

Speaker 37 We had a hard time with that with my mother. You know, traveling with her at the end was very difficult, but we made it happen and we made our memories.

Speaker 25 So.

Speaker 1 Okay.

Speaker 1 I'm sorry, what an amazing amount of challenges.

Speaker 1 I would just throw that in a high-yield savings account for six months.

Speaker 1 Because in six months, you're going to have a lot more information on both of these situations.

Speaker 1 Okay.

Speaker 1 How expensive a fight have we got? How long a fight have we got? And how much are are we going to look at alternative solutions

Speaker 1 that our insurance won't cover?

Speaker 1 Okay.

Speaker 1 And that would be true in either case, but certainly true in your wife's case, right?

Speaker 1 And then with her dad, does he have money? And how much is he going to, you know,

Speaker 1 above

Speaker 1 his out of pocket after insurance? And then is he going to try or do anything other than that that is going to be expensive? Okay.

Speaker 37 Well, he doesn't have much. He lives with us.
We have in-laws quarters.

Speaker 37 And he has Medicare and Medicaid. So most of

Speaker 37 all of his treatments have been covered from that.

Speaker 37 It's just, you know, I want to do right by him. He's been a workhorse, much like my mother, his whole life, working.

Speaker 1 Yeah, but I don't think you're going to have $100,000 of medical bills with him.

Speaker 35 No, no, no, no, absolutely not.

Speaker 29 Okay. Absolutely not.
But, you know, I don't know what the future holds.

Speaker 4 So, you know,

Speaker 37 I have the monies right now in a Schwab account.

Speaker 35 I could put that in a high-yield savings.

Speaker 1 I just put it in high-yield savings

Speaker 1 and just forget it's there. It's just sitting there.
And then as soon as you actually can quantify these situations a little bit in terms of

Speaker 1 how long are we going to be in this fight, and

Speaker 1 what's the actual out-of-pocket expense from these two different fights, then that tells you if you can invest and begin to do some other things with some of that money.

Speaker 1 Let's pretend that it's a minor issue with your wife, okay,

Speaker 1 and it's nothing. We're done.
Six months from now, it's way in the rearview mirror. The Bob C was benign, no problems, no issue.

Speaker 1 We're done. Okay? So we had a few hundred dollars in deductibles or whatever, some co-pays.
We're done. Then you don't have to worry about this $100K for that purpose.

Speaker 1 I'm not going to leave it around for vague worries, but I'm going to leave it around for specific worries.

Speaker 37 Well, one of the reasons why I've left it there in that account also is she's attempting to do a career change, which is drastically going to change her income.

Speaker 37 She currently makes about $100,000 a year, and her career change could drop us about $30,000 a year.

Speaker 33 So it's a pretty big shortfall.

Speaker 1 Can you not live on what you make?

Speaker 37 Well, in Miami, it's a little...

Speaker 1 Can you not live on what you make with her career change?

Speaker 33 Yes.

Speaker 1 If you can't, she doesn't need to do the career change.

Speaker 37 Yeah. I mean, it is a luxury and she wants to do it to be home more.

Speaker 1 Luxury is fine, but if you can't live on it, you can't do it.

Speaker 1 Yeah.

Speaker 1 Because if you've got to feed your household $30,000 a year in three years, this money's gone and then you're screwed. You've got a burn rate on this, man.

Speaker 1 So you don't create sustainability from savings.

Speaker 1 So that's a completely different subject than you called with. But yeah,

Speaker 1 you've got to create a budget that you guys can live on. So if you can afford to live on without touching this money, her career change, she can do it.

Speaker 1 If you can't, she can't do it.

Speaker 14 Or you guys change lifestyle. You've got to change something.

Speaker 1 Yeah, but this $100,000 is not going to save you on that. It's not even going to come close.

Speaker 1 So, no, that won't work. But having it set aside to make sure you turn the corner on some cancer diagnosis until you turn the corner, I'd let it sit there.

Speaker 1 Many of you listen to the Ramsey Show because you're sick and tired of getting nowhere with your money. You work too hard to live paycheck to paycheck with no money in the bank.

Speaker 1 But here's the deal: just listening to the show won't change that. If you want different results, you have to do something different.

Speaker 1 We've helped millions of people save money, ditch debt, and build wealth. And you can too.
But you got to have a game plan, and that begins with our get-started assessment.

Speaker 1 Go to ramseysolutions.com/slash start now, take the free quiz, and get your free step-by-step action plan.

Speaker 1 If you've had it with money stress and are ready to take control of your money for good, go to ramseysolutions.com/slash start now.

Speaker 1 Welcome back to the Ramsey Show. Rachel Cruz, Ramsey Personality Number One Best Selling Author, is my co-host today.

Speaker 1 Open phones at 888-825-5225. Melissa's in New Jersey.
Hi, Melissa. How are you? Hi, how are you? Better than I deserve.
What's up?

Speaker 32 So my husband and I have been married for 18 years. We have a separate account.
I'm a teacher.

Speaker 32 He was a construction manager, a project manager for a long time.

Speaker 21 Now

Speaker 21 he's

Speaker 32 got laid off from two jobs within the past two years, and now he's self-employed

Speaker 32 and he's building a business on his own.

Speaker 32 In that process, we had our rental property that we originally lived in when we first got married. We had two kids,

Speaker 32 two-family home. We bought it

Speaker 32 together after we got married, and

Speaker 32 the down payment was an account that my husband had. It was $50,000.

Speaker 32 His dad died when he was around nine years old, and the mother put all of the father's social security security checks into an account to help it grow.

Speaker 32 And that's what he wanted to use that account for to put the down payment on that house. Then we remodeled it with our wedding money.
We lived in it for about 10 years.

Speaker 32 And then we bought a single family home, but we kept it as rental.

Speaker 21 So

Speaker 32 our only joint account was

Speaker 32 where the

Speaker 32 house rental income was going into. When I was not working, because I was a stay-at-home mom for 10 years,

Speaker 32 we also had a joint bank account that was originally his, and he just added me on.

Speaker 1 Gotcha.

Speaker 1 What's your question, honey?

Speaker 32 My question is,

Speaker 32 we sold our rental property, and

Speaker 32 he told me it was going into the joint account, and I was sitting at the Starbucks signing papers, and the $475,000 that we made on the house was going into his only account, his sole account.

Speaker 1 Why'd you sign the papers?

Speaker 32 Because he told me that we would lose our house. We would lose everything because we have no money to live on, which

Speaker 32 we didn't. We would have to sell our house.

Speaker 1 You wouldn't lose everything if he just changed the account and put it into the joint account.

Speaker 32 Well, he didn't.

Speaker 1 No, I'm just saying. I wouldn't sign the papers till he did.
Why didn't you say that?

Speaker 32 Because our dynamic is based on a lot of intimidation and fear.

Speaker 1 So, when is the divorce? I trusted him.

Speaker 22 I know.

Speaker 32 Well, I trusted him to take care of our finances because he's very financially savvy.

Speaker 32 And that's, you know, we kind of have our roles and we kind of let each other take care of our, you know, what our strengths are. But now he

Speaker 32 won't let me see the money. He told me the money is his and his mother's money.
It's not my money. He did all the remodeling on the house.

Speaker 1 He's confused.

Speaker 32 So I don't know what my rights are. I don't know what to do.

Speaker 1 The only rights you have are in divorce court.

Speaker 25 Okay.

Speaker 25 Okay.

Speaker 1 That's the only place you're going to get. That's the only place you're going to get a legal right.

Speaker 1 You have moral and ethical rights, but he's ignoring those.

Speaker 36 Yeah.

Speaker 1 But New Jersey will take half of that money and give it to you.

Speaker 36 Yeah.

Speaker 32 I mean, I don't know what he did with it. I have no access to anything.
He has stock accounts, investment accounts.

Speaker 1 Divorce requires discovery, and if he hides any of that,

Speaker 1 it's a criminal act.

Speaker 32 Right. Well, he says that I am a teacher because I put myself through school and they're not.

Speaker 1 Did you not hear me?

Speaker 32 I know.

Speaker 1 Half of this is yours.

Speaker 36 I know.

Speaker 1 Okay. Then quit acting like you have to go through all this.
What he says doesn't matter. I know.

Speaker 1 When the law tells him what to do, it's going to be interesting for him.

Speaker 1 You're right. Yeah.
So, I mean, you know, it's up to him. Does he want to because

Speaker 14 this is a marriage issue, Melissa, obviously.

Speaker 1 You guys do not have a marriage. You have very little marriage left.
Absolutely. Hanging on by three.

Speaker 1 Are you

Speaker 14 wanting something different? Like, what are you thinking?

Speaker 1 Do you feel like that?

Speaker 32 I want a divorce,

Speaker 32 but I'm afraid that I'm going to have nothing.

Speaker 32 We live a very, very nice life.

Speaker 1 The only way you would have nothing is if he hides it all and your attorney's so weak he lets him get away with it.

Speaker 36 Yeah.

Speaker 32 Yeah.

Speaker 1 But are you working now?

Speaker 1 You're probably a millionaire. Yeah.
Yeah.

Speaker 32 I make he was when he was a project manager about two years ago, he made about almost $218,000 a year. And I

Speaker 32 right now make about $80,000 a year. I'm a teacher.

Speaker 32 But the bills that I, my bills that I pay toward the house and whatever random needs my, I have two teenagers, whatever they need.

Speaker 32 By the end of the day, I don't have much money to put away to save for myself.

Speaker 1 Here's what you need to do.

Speaker 32 You know, you, you have a job, you can pay for it.

Speaker 23 When I asked him for money, that's exactly what he says.

Speaker 1 Yeah, this guy's not

Speaker 1 a good thing to be around. Yeah.

Speaker 32 So I say, you should be giving me money now.

Speaker 1 You're not.

Speaker 1 Here's

Speaker 1 when you're overwhelmed, what you need is information and facts, and information or facts that are coming from him are not information or facts because we know him to not be a reliable source, okay?

Speaker 1 I'm not a lawyer in New Jersey, but you need one.

Speaker 1 So if you go sit down with an attorney and say, okay, here's what I do know. I know we had this 475.
I know we had this stock account. I know we had this.

Speaker 1 How can I be protected in this process? And the attorney will explain it to you, what the laws are in New Jersey.

Speaker 1 You can have a consultation with an attorney, a divorce attorney, and it probably won't cost you a dime to do the consultation

Speaker 1 and gather information because you're functioning in fear, not on facts.

Speaker 1 And when you're in trauma, when you're in a dramatic situation like this, your emotions are making the decisions, and they're not making good decisions because they're not based on facts.

Speaker 1 And so if you just cut through all that and go, facts are my friends. Facts are my friends.
The way he makes me feel is not a fact. That's a feeling.

Speaker 1 The fear of he may have stole all this money. I may never get any of it.
I may be broke. I may be homeless.
That's not a fact. That's a fear.

Speaker 1 Okay? The facts are you have a teaching job. It's really good.
The facts are that New Jersey requires child support. to be paid when you have teenagers.

Speaker 1 The facts are that New Jersey will require some kind of property disposition, probably around 50% each.

Speaker 1 Those are the facts. Now, once you have those facts and you go, gosh, half this money is mine.
The law says that.

Speaker 1 Now then you can go back and say, Bubba, if we're going to keep this together, we're going to have to go see a marriage counselor and everything in this house is going to change.

Speaker 1 Otherwise, we're not going to be able to keep this together. I've spoken with a divorce attorney and I have an appointment with a marriage counselor.
Which one do you want me to go to?

Speaker 36 Yeah.

Speaker 36 Yeah.

Speaker 9 I'm going to do that.

Speaker 36 Yeah.

Speaker 1 But you do all that from knowledge, which will make you much calmer.

Speaker 21 Yeah.

Speaker 1 Okay. Yeah.
Because all these things are spinning out in your head, and he's activating a four-year-old version of little Melissa who thinks she's going to be on the street. And you're not, honey.

Speaker 1 You're going to be okay.

Speaker 1 And I hope you don't have to go through this. I hope the guy can be woke up and you can save your marriage.
That would be neat. But at this moment, you don't want to be married to him.
I can hear it.

Speaker 1 And nobody does. Nobody wants to be married to the guy you've described for the last few minutes.
So I'm so sorry. But y'all go get some actual information, and that gives you power.

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Brian's in Minnesota. Hey, Brian, how are you?

Speaker 1 Hey, I'm doing good. How are yourself, Dave? Better than I deserve.
What's up?

Speaker 29 Good. So I had a quick question for you, I guess.

Speaker 22 So I'm in a predicament.

Speaker 39 It's not necessarily a bad one. So

Speaker 39 I am 26 years old. I bought a house of five years ago when the market was pretty cheap.
I have $130,000 in savings doing nothing for me. I only have $95,000 left on the mortgage.

Speaker 29 So I guess my question was, what's your opinion on what I should do?

Speaker 39 Is if I I should pay it off earlier with the money I have saved, should I invest into something or just keep it in a high-end savings account?

Speaker 1 Or did you get $130,000?

Speaker 33 I'm very frugal. I'm a good saver.

Speaker 39 I've worked for every penny of it, and nothing's been handed to me. And yeah, it is a good save money, I guess.
You're single?

Speaker 39 No, I get married actually next December.

Speaker 1 Oh, congratulations.

Speaker 1 Does she have any debt?

Speaker 39 No, she's got no debt at all. She makes 80K a year.

Speaker 1 And yeah, I guess we don't even know what to do right now. Sounds like a match made in heaven.

Speaker 1 But it's kind of too good to be true. It's kind of like what now.

Speaker 39 So I don't want to be staying or wasting money on, but my mortgage is only 3%, and at the bank, I'm getting 4% of my money.

Speaker 11 So I'm like, well, I could pay my house off and live pretty

Speaker 39 generously with my life.

Speaker 11 Obviously, I've some kids and go from there.

Speaker 39 So I guess I'm kind of stuck on what I should do.

Speaker 27 Okay.

Speaker 1 If I woke up in your shoes after doing what I do for 35 years,

Speaker 1 I would write a check today and pay off your house.

Speaker 1 And I'd have no payments. Take your shoes off, walk through the backyard, you'll find the grass feels different.

Speaker 11 I thought about doing that yet.

Speaker 39 I just got on escrow this past week, and that was a nightmare and a half. Sounds like the biggest scam I've ever been through before.

Speaker 11 And I almost like, you know, you just want me to be done with this loan.

Speaker 39 I'll just be done.

Speaker 1 But each month, you know, I've been telling people to pay off their mortgages in situations like this for 30 years. I have never had someone call me back and say, gosh, I really regret doing that.

Speaker 1 That was bad advice.

Speaker 1 That's like a sixth one, right?

Speaker 1 I've never had somebody tell me it was a bad idea. And by the way, Brian, if you hate being debt-free, you can always go get you another mortgage.

Speaker 1 So, no, I would write a check and pay it off today, huh? Amen. Hallelujah.
Yeah, just

Speaker 1 very cool. Good for you.
Rick's in Las Vegas. Hey, Rick, how are you?

Speaker 34 Hey, Dave. Hey, Rachel.

Speaker 38 Thanks for taking my call today. I appreciate it.

Speaker 1 Sure. How can we help?

Speaker 34 So I have a 401k question for you.

Speaker 38 I'm just trying to plan for next year.

Speaker 38 I max out my 401k every single year, not only as an individual, but from the company contributions as well.

Speaker 38 This year, it was $23,500 for individual and I think $46,000 from the company, so $70,000 total.

Speaker 29 My question is, next year,

Speaker 34 I'm debating on whether I want to front load it all

Speaker 38 by February. We get a huge profit sharing check every single year, and I max it out in February.

Speaker 29 Is it better to do that or is it better to spread it out throughout the year?

Speaker 1 Well,

Speaker 1 we have taught in our world dollar cost averaging for so long that people sometimes avoid the lump sum.

Speaker 1 And that's kind of what brings your question to bear. So

Speaker 1 what I do is I fully fund mine in the first month of the year.

Speaker 1 And the reason is this.

Speaker 1 The only reason you would spread it out throughout the year is if emotionally you can't handle the stock market going up and down and you're going to freak out.

Speaker 1 But that doesn't bother me a bit because I don't even look at it. I just put it in there and I'm thinking, I'm probably never going to touch it.

Speaker 1 I'm probably putting it in there for Rachel's kids because I'm probably not going to use that money anyway. But the

Speaker 1 and Denise and Daniel's kids. But anyway, it's not just Rachel's kids.
But the Rachel's kids are like, woohoo, yeah. Off of Dave.
Yeah. But anyway,

Speaker 1 so the point being that mathematically,

Speaker 1 even if the market goes down right after you put it in, by the end of the year, it will have gone up more than it went down 90% of the time. That's the history of the stock market.
Okay. Okay.

Speaker 1 And so, you know, sometimes you get a bear market that lasts over 12 or 14 months, but very seldom.

Speaker 1 You know, if you go back and

Speaker 1 look at the track record of the stock market, look at the S P charts, okay, and

Speaker 1 look at how many times, you know, so what ends up happening is

Speaker 1 the entire lump sum is earning money all year,

Speaker 1 or

Speaker 1 1 twelfth of the lump sum is earning money, then 2 12ths is earning money, then 3 12ths is earning money, and then 4 12ths is earning money.

Speaker 1 So the point is, I'm making those S P returns for 12 months while someone that's spreading it out is not getting the same dollar result that I'm getting. Does that make sense? Sure.

Speaker 35 Yes, it does.

Speaker 1 So I lump summit for that reason. But you can't do that if you can't emotionally handle two months later, Trump burps and the market goes down,

Speaker 1 you know, or he throws a tariff on some bizarre country that we never heard of and the market goes down, you know, or whatever it is, right?

Speaker 1 And so you don't know what's going to happen out there on the short term. And so you can't be freaking out all the time if you're doing that.
Yeah, but you lump some ears at first, don't you?

Speaker 14 Yes. And depending on age, for sure, your mindset should always be long-term.

Speaker 1 Right. I mean, if you're

Speaker 14 61 and you're looking at retiring,

Speaker 14 you know, there's something there. Yeah.
So, I mean, like, it's, there's not really a point.

Speaker 1 Unless you're 58. That's right.
49 and a half or whatever. Yeah.

Speaker 1 In my case, I could touch it if I wanted to because I'm 65.

Speaker 14 Which would be, I could see that having a different psychology. But

Speaker 14 when you're younger than that, you know, when you're in your 40s,

Speaker 14 50s, 30s, all of of it, you know, it's long-term anyways.

Speaker 1 If you're not thinking in five-year blocks a time or longer, you shouldn't be putting in a four-wheeler. That's right.
That's right. Even at my age.
You need to be thinking long-term.

Speaker 1 And so I'm thinking past my death because, again, I'm probably not going to ever touch that money. I've got plenty of other stuff generating income without touching that.

Speaker 1 And so that money's probably, it's all in Roth, too. So it's all going to pass completely tax-free.
It's awesome. So, yeah, another reason I won't be touching it.

Speaker 1 So, yeah, that's the thing, which also kind of, we can sidebar on that for a second, Rachel, because it's a good teaching point.

Speaker 1 And I didn't think about this when I was your age and teaching this stuff, and I was your age and doing this stuff and building the wealth. But now that

Speaker 1 as I'm hitting these milestones, 65 and all that, I'm starting to understand at 72 and a half, you have, if you have traditional IRAs or 401ks that have not yet been taxed, you have required minimum distributions that are beginning.

Speaker 1 You have to begin to take it out because the government wants their tax money.

Speaker 1 If it's in a Roth, it is growing tax-free

Speaker 1 and there's no RMDs, no required minimum distributions. I have moved over the years 100% of ours into Roth and paid the taxes on those lump sums as I did that.

Speaker 1 Even the matching portion at Ramsey, where I match myself, has to be, it's required to be

Speaker 1 traditional.

Speaker 1 But each year, I roll it to Roth. Yeah.
So I don't have anything that's not Roth now at my age. So this is really beautiful.

Speaker 1 Not only is all that growing tax-free for me, but then also I don't have RMDs. I wouldn't, I don't really, I didn't consult.
Where are they?

Speaker 14 Yeah. It's just a required dollar amount.

Speaker 1 No, no, no.

Speaker 14 What's the dollar amount?

Speaker 1 It's a chart. It's a percentage.

Speaker 14 Percentage of charts. It's more each year, okay?

Speaker 1 Because they want to get their taxes. Yeah, they want to get to the taxes.
They're going to require you to begin to cash out traditionals.

Speaker 1 But if it's not traditional, you're not required to take it out. And it's continuing to grow tax-free.

Speaker 1 And with the new Biden Secure Act, the legislation was passed under President Biden, if you do an inherited IRA and it's a traditional,

Speaker 1 all the taxes are due within 10 years. You have to cash it out over 10 years.
If there's no taxes due on a Roth,

Speaker 1 none of that applies. So when I do leave it to you, the kids,

Speaker 1 as an inherited IRA, as a beneficiaries, then

Speaker 1 there's zero tax on it.

Speaker 1 None. And no required distribution.
So getting that stuff moved into Roth as you get old,

Speaker 1 if you can figure out a way to pay the taxes, it voids all that stuff. And I didn't even think about all that stuff when I was in my 30s.
I was just chunking money in there like crazy.

Speaker 1 And now I look back and go, man, that Roth stuff's freaking genius.

Speaker 1 We've all done dumb things with money. I've done them with zeros on the end.
One of the biggest mistakes I see people make with money is not having a plan for it. You got to have a plan.

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Speaker 1 Seven out of ten Americans die without a will.

Speaker 1 Listen, if you hate your family,

Speaker 1 make a big old pile of money, make it real complicated, and die without a will. They will fight for the next 15 years and they'll hate each other.

Speaker 1 You will completely shut down all their productivity because they'll be screwing with your stuff.

Speaker 1 Unbelievable. Howard Hughes, one of the richest men in America at that time, died with $2.5 billion in 1976.
It took almost 10 years to settle. 600 people filed a claim.

Speaker 1 22 of his legal cousins ended up with the money. It was split among 22 people.
The judge finally decided almost a decade later. Guess who got most of the money? The lawyers.

Speaker 1 That's how that works. So

Speaker 1 if you want to do that, that's fine, but that's called dumb.

Speaker 1 Okay? Get a will.

Speaker 1 I love it.

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Speaker 1 Michelle's in North Carolina. Hi, Michelle.
What's up?

Speaker 12 Hi, guys. Thank you so much for taking my call.
I'm honored to to be talking to both of you.

Speaker 1 You too. How can we help?

Speaker 12 My boyfriend and I started dating in April, and we're really in love and thinking about getting married this October.

Speaker 12 He's in about $60,000 worth of debt, and I'm out of consumer debt. I just have my mortgage.
I have about a $500,000 net worth with my house and my retirement.

Speaker 12 And my parents helped me buy my house as a gift. And my dad is saying that I should get a prenup before getting married, especially because we haven't been dating that long.

Speaker 12 So I'm wondering what your old thoughts would be on that.

Speaker 14 I mean, yes, I mean, you started dating and we'll get married within six months.

Speaker 1 Is that right?

Speaker 36 Yeah, seven, but yeah.

Speaker 1 Okay, yeah, yeah, yeah, yeah, yeah. How old are you?

Speaker 12 34.

Speaker 1 Okay.

Speaker 1 Wow.

Speaker 1 Well,

Speaker 1 the thing is, your dad just doesn't trust the situation.

Speaker 36 Yeah, that I get.

Speaker 1 Yeah.

Speaker 1 And if you don't trust the situation, you should get a prenup. But if you don't trust the situation, you probably should be engaged a little longer until you trust the situation.

Speaker 25 Yeah.

Speaker 12 Yeah, one thing I'm worried about is this would be his second marriage, and he has a child from his previous marriage, and he's been having some custody issues there.

Speaker 12 So I'm definitely worried about what could happen with my finances and my home once we combine everything.

Speaker 1 And, you know, if his wife came into the middle of the year,

Speaker 1 you're marrying into that. Yeah.

Speaker 1 And so if he spends, you know, y'all, if you have combined finances and you all have to spend some money on custody, that's going to affect your income and your savings and your investments, right?

Speaker 1 It's not going to cause you to lose your home, but it is going to, you know,

Speaker 1 that's what you're getting with the package.

Speaker 36 Yeah.

Speaker 1 For better or for worse, for richer, for poorer,

Speaker 1 in sickness and in health,

Speaker 1 unto thee all my worldly goods I pledge.

Speaker 1 That's the old marriage vows. You remember them?

Speaker 1 Yeah.

Speaker 1 So,

Speaker 1 okay, our rule of thumb, when I first started, I told nobody to do it, no one should get prenups because you're planning your divorce.

Speaker 1 And if you like your house more than you like him, you shouldn't get married. And that's what I used to tell everybody, okay? I don't say that anymore exactly that way.

Speaker 1 I have said it a couple times on weird things. Like one lady called up and her boyfriend, her fiancé wanted a prenup because he had

Speaker 1 a vintage sports car

Speaker 1 that was worth $100,000. And I'm like, he likes his car more than he does you.
You don't need to marry him. And so that I'm willing to say.

Speaker 1 I come down on your dad's side almost on that.

Speaker 1 But

Speaker 1 where I have

Speaker 1 where I am trying to keep things moving is

Speaker 1 not it's not assuming that you really feel a thousand percent about him, that he's okay and he's aligned on getting out of debt, staying out of debt, living like you live.

Speaker 1 You're going to live on a plan. We're going to combine our finances.
We're going to make life together.

Speaker 1 We're going to make decisions together in unity.

Speaker 1 If he's completely trustworthy on that,

Speaker 1 then the only reason I would do a prenup, and if he's not, by the way, he's not ready to get married. Yeah.

Speaker 1 Okay. And that's something you got to solve.
And I'm not going to put you on the spot and ask you that here because I don't think that I don't think that's the case.

Speaker 1 I sense this guy's the way you're describing him is solid.

Speaker 1 Okay.

Speaker 1 I mean, he's got outside issues with the child support, possibly, that kind of stuff. But

Speaker 1 so anyway,

Speaker 1 the reason we tell people to do prenups these days is if there is an extreme difference in net worth. Okay.
He has

Speaker 1 negative net worth, and you have $10 million or $5 million.

Speaker 1 You don't. You've got $500,000.
So it's not extreme, but it is enough that I get your dad. Okay.
I understand him thinking that. And it's exciting.

Speaker 1 And your dad actually gave you the money to get this started. So I get that too.
Okay.

Speaker 1 I'm not mad at your dad on this. But so yours is not extreme, but the reason we tell people to do that when it's extreme is actually not the person you're marrying.

Speaker 1 I'm not trying to protect you from them. I'm trying to protect you from his ex-wife thinks she can keep you guys in court forever because he married a girl who's got some money.

Speaker 1 I don't want to send her that message. And he could just look at her and go, I don't have any access to this.
I got a prenup

Speaker 1 and shut her little emotions down.

Speaker 1 Or the crazy relative of whoever that comes along and thinks, oh, hey, this guy hit the jackpot. And you go, no, he's got a prenup.

Speaker 1 So that kind of kind of helps the outside crazies more than the two of you.

Speaker 1 Does that make sense? Yeah, it does, yeah. And so I

Speaker 14 it's probably the short timeline.

Speaker 1 Yeah. That's probably because if you had told me a little bit

Speaker 1 more lengthy engagement and you guys went through Financial Peace University together, you were completely aligned and you go through good, strong premarriage

Speaker 1 counseling, I would probably say no.

Speaker 1 I'm on the bubble with yours, though.

Speaker 1 I might

Speaker 1 in yours.

Speaker 1 I wouldn't think you're stupid if you did it one way or didn't do it the other. If you do it or don't do it.

Speaker 1 So I mean, if your dad thinks you're just crazy, I would disagree with your dad okay but he if he's just saying this is a wise suggestion you should consider it then i would agree with him on that okay

Speaker 1 and if and also a wise suggestion is for you to you guys to spend some time in pre-marriage counseling and deal with okay what comes up when we got a twenty thousand dollar legal bill to fight the crazy ex on the kid

Speaker 14 can you handle that emotionally and when you guys get married michelle like to the point that you're so unified that this sixty thousand dollars of debt is yours too yeah you get it paid off you you guys are, yeah, and you guys solve it together.

Speaker 1 And you get it paid off of it. I'm on board with.

Speaker 1 Yeah. Yeah.
Yeah. And so if you guys can work through that kind of stuff, the length of the engagement becomes less stressful for me.
I will tell you this.

Speaker 1 The data tells us, and there's lots of data on this, that a six-month engagement period and a three- to four-month dating period prior to that, marriage within 12 months of being, within within 12 months of meeting,

Speaker 1 has a very high probability of success.

Speaker 1 And

Speaker 1 as you shorten it statistically, the probability of success goes down. And as you lengthen it dramatically, five-year engagements are bull crap, okay? Painter, get off the ladder, right?

Speaker 1 And so, you know, as you lengthen it, it doesn't make sense because the relationship gets strained for all these other reasons then. We're just playing games.

Speaker 1 So, but anyway, that's the data that we have on marriage stats. And so you're a little bit short on that data.

Speaker 1 It's not a deal killer, but you know, because that incorporates, hey, I met you last weekend. Let's go to Vegas.
And we're married. You know, those don't, those only make it in the movies, okay?

Speaker 1 And because they wake up from the hangover and like, oh, what did I do? And they get an annulment, like Rachel and Ross. Sometimes it works.
Rachel and Ross. We have a friend's reference in the movie.

Speaker 1 I'm so proud of you. You know that.

Speaker 1 So anyway, all of that, end of speech, Michelle. So I hear what your dad's saying.
You hear what your dad's saying because you're not a child. You're 34 years old.

Speaker 32 Yep.

Speaker 1 And so it's not, you know,

Speaker 1 I think you solve for those concerns for you.

Speaker 1 Not for your dad. And if you can get to where you're a thousand percent solid, if you want to not do one, I'm okay.

Speaker 1 And if you got a little itch and you want to do one, that's okay. But it's also an indication you probably need to do some more work before you go to the altar.

Speaker 1 Our scripture of the day, 2 Corinthians 1:4, he

Speaker 1 comforts us all in our troubles so that we can comfort others. When we're troubled, we will be able to give them the same comfort God has given us.

Speaker 1 Margaret Thatcher says, No one would remember the Good Samaritan if he only had good intentions. He also had money.

Speaker 1 Josh is with us in Arkansas. Hi, Josh.
What's up?

Speaker 29 Hey, Dave, thank you for taking my call. Sure.

Speaker 1 How can we help?

Speaker 29 Well, my wife and I finally sat down yesterday evening and filled out the every dollar budget. And upon doing so, figured out that we have

Speaker 29 roughly $87,000 in consumer debt, auto loans, credit cards, secured loan, that kind of thing.

Speaker 1 That was an old crap moment.

Speaker 1 Yeah, you could say that.

Speaker 29 And we pay about $4,000 a month towards that debt. And we visited a little bit this morning about it, and

Speaker 29 she kind of seems to want to just like keep chipping away at it. And I'm of the opinion that we could get rid of the truck payment, get rid of the secured loan, which together are about

Speaker 29 $69,000 worth of that

Speaker 29 and be in a much better position.

Speaker 14 And how would you do that?

Speaker 1 What's the secured loan?

Speaker 29 So the secured loan is $32,000.

Speaker 29 It's in a private credit union. And one of the reasons she wants to keep it is they still pay us interest on the full amount,

Speaker 29 regardless of whether we borrow it.

Speaker 1 Oh, so you have enough savings in there to cover it, and that's what's secured.

Speaker 1 So you borrowed your own money.

Speaker 1 Correct. Yeah.
Okay.

Speaker 1 All right.

Speaker 14 So how much do you guys have in savings total, Josh?

Speaker 14 Roughly $10,000.

Speaker 1 No, you got $30,000 over in the current $100.

Speaker 29 In the savings total, in that account, $36,000.

Speaker 1 Okay. And you owe $32,000 on that.

Speaker 25 Yes, sir.

Speaker 1 And then you've got a $69,000 truck that I guess you're driving.

Speaker 29 No, well, the $37,000 truck.

Speaker 1 Oh, $37,000.

Speaker 29 Honestly, it's a part-time vehicle. I have a work truck that I drive most days.

Speaker 1 Okay. All right.
And your household income's what?

Speaker 37 About $160, $165.

Speaker 1 Okay.

Speaker 1 Our experience with this process is that people

Speaker 1 come to

Speaker 1 the right conclusions at different speeds.

Speaker 1 You went straight to, here's what we do. I'm going to fix this.

Speaker 1 She's still processing all of it.

Speaker 1 And so when she, I'm going to interpret her, I might be interpreting interpreting her wrong. Okay.

Speaker 1 I think when she said, I want to chip away at this, she said, I'm still thinking this through, and for now, let's just kind of do our budget. Like we just made our budget scary enough.
12 hours ago.

Speaker 1 Yeah.

Speaker 1 I've had a whole 12 hours to process this. Okay.

Speaker 1 So I'm more wired like you, Josh, isn't that I can make a decision in about 30 seconds. If it's the wrong one, I'll just make another one.

Speaker 1 My wife, on the other hand, likes to cook for about three days before she comes to the same conclusion.

Speaker 1 But if I try to get her there faster than she gets there, things don't go well at the Ramsey house. And so

Speaker 1 I've learned to slow down a little bit on that.

Speaker 1 The other thing that we find a lot of times with folks that are brand new on this stuff is that it's real easy, again, for people that are wired like you, and you're not wired wrong, but it's just the difference in you and your wife.

Speaker 1 It's real easy to go straight to the tactical before we've clearly

Speaker 1 and thoroughly discussed the why.

Speaker 29 Well, to be fair, I'm part of the why.

Speaker 29 So I buy and sell vehicles.

Speaker 29 I mean, I don't.

Speaker 1 No, no, no.

Speaker 1 No, no, no. Why are we cleaning this up? Sure.
Why does this matter? We want to build wealth. Okay, good.
Why do we want to build wealth? We want to build wealth so we can change our family tree.

Speaker 1 We have three precious kids. We don't want them to be broke.
We want to leave an inheritance to our children's children. That's what a godly man does.
Why are we doing this?

Speaker 1 We want to do this so the stress is off our marriage. We want to do this so that we can be outrageously generous.
We want to do this so that we can travel.

Speaker 1 And if you get those things all dialed in in high definition and both of you are excited about where you're going,

Speaker 1 then it's easier to endure the pain to get there.

Speaker 1 Sure. So you guys probably didn't spend enough time dreaming yet.

Speaker 1 Well, I think

Speaker 29 kind of what I was getting at is she is probably concerned that I'm going to go, you know, two months from now, I'm going to go, you know what, I changed my mind. I want to get another truck.

Speaker 35 Yeah. Because I've done this before.

Speaker 1 Okay.

Speaker 1 That's fair. And, you know, if you say that out loud to her, it would probably give her comfort.

Speaker 1 Yeah.

Speaker 1 And that's. That's the awareness of the patterns of what it was.
Yeah, that's fair that I am aware that patterns there, and I understand how this is not. I don't have credibility to talk about this.

Speaker 1 But here's the difference, honey. The difference is I was doing that in those days for one reason.
Now we've got this big why that we both agreed on.

Speaker 1 Okay.

Speaker 1 And

Speaker 1 in our case, we went broke. And for Sharon and I, we were very unified on yelling at the mirror never again.

Speaker 1 I will never be in a situation again where some butthole banker puts his foot on my neck ever again.

Speaker 1 Redneck mad 35 years ago, and I'm still pissed.

Speaker 1 You follow me? That was my why. That was my why.
It drove me through this stuff. And Sharon had been so terrorized by the whole process that that was a fair why.

Speaker 1 Other families that stand on the debt-free stage, they say it was for the kids. We had to change this for our family tree.

Speaker 1 It wasn't for our kids. Our kids just got the benefit of eating while we were doing it.
I mean, that was it. We weren't like, oh, the little children.
We weren't that way.

Speaker 1 We were like, no more freaking bankers. But other people are like, the little children, I'm doing it for the children.
You know? And it's okay. I don't care what your why is.

Speaker 1 It just needs to be big and noble.

Speaker 14 And to get you through the hard times.

Speaker 1 And then you're both aligned on it. And so that if you went to go buy another truck later, she would go, yeah, but we agreed on the why.
And that truck's messing up my why. We're not doing that.

Speaker 1 And she could call you out on the why, not the truck.

Speaker 1 Okay.

Speaker 1 And if you guys, I think if you'll let her cook a little, number one, number two, you high definition in detail, write it down, put pictures up of the trip we want to go on.

Speaker 1 We want to do a worldwide cruise. I don't care what your way is.
It just needs to be a real driving reason to get the mess cleaned up so that we can get to do that thing or be that thing.

Speaker 1 Okay.

Speaker 1 And when you guys do that together, then she's willing to sell your truck. Then she's willing to give up the thing.

Speaker 1 But yeah, if she both of her not wanting to do both of those things probably easily could go back to she's worried you're going to want to go back and get another truck for sure she's trying to keep out some money in the credit union even though it's secured against it yeah just to keep you from getting another truck so and the more time that passes the more intense she's going to get because the more she's going to trust you're not going back to your old ways yeah yeah and and josh have a a really detailed plan out of like okay how

Speaker 14 per month what do we think we can put at this debt if we sell this this this like start to map out some actual plans very tactically very detailed.

Speaker 14 And I think that helps too, because conceptually, if it's like, we'll just cut our lifestyle and the grocery budget needs to be cut in half.

Speaker 14 And, you know, you start thinking through these things, it can be way more difficult because you almost can't even see the end or the process of how to get there.

Speaker 14 You're just kind of like looking at today and you're like, oh, gosh, that's going to be hard. So the whole plan has to be fleshed out.
And the end of the plan is the why, exactly what you're saying.

Speaker 1 And then if you get off that plan to go do something stupid, you can call each other out.

Speaker 14 Or if life happens, you pause the plan to figure out life.

Speaker 1 And then then you do that together. We do that together.
You don't get to go, oh, I changed my mind. I'm not doing this whole thing we laid out.

Speaker 1 Well, the only reason I agreed to the whole thing was we laid it out, and we're sticking to it. And so then you've got a thing.
It's a plumb line.

Speaker 1 It's your guidance mechanism, and you're sticking to the whole thing. Rachel's exactly right.

Speaker 14 The encouraging thing, though, is

Speaker 14 that 32 out of the 87 is going to be cleared up because you have 36, so that's four. And then you have another 10, that's $14,000.

Speaker 1 And you get rid of a $37,000 truck, the whole thing.

Speaker 1 you can really make a bunch of progress real fast. Yes, yeah, y'all.

Speaker 1 So I don't disagree with your tactics, but I'm trying to help you understand, and I'm trying to understand with you why she's tapping the brakes here.

Speaker 1 And

Speaker 1 I think we discovered that. So it's a great call, Josh.
And you guys are going to do great. You're going to be fabulous.
That puts this hour of the Ramsey Show in the books.

Speaker 1 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.