Stop Letting Excuses Steal Your Wealth

Hey guys, Dave Ramsey here. Me and Dr.
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This is the Ramsey Show, where America hangs out to get coached up on their life, specifically their money life, their professional life, and their relational life. 888-825-5225 is the phone number to jump in, America.
It's your show, 888-825-5225. Alongside the fabulously fly, I feel like today, Jane Warshaw.
I got to say, I think you got a 90s vibe, and I don't have a problem with it. I'm in it.
I'm all the way in it. Number 23.
I'm not ashamed of my age. I graduated in 1992 from high school.
We've got a big group of fantastic looking young scholars,

high schoolers from a local school here today looking at us,

and they're all like, yeah, he's pretty much my dad's age.

And I am.

Can we clear the – we're not the same age, though, Ken.

No, you're younger than me.

Look at you all ashamed.

Are you shaming me? Listen, I'm not trying to be where you're at yet. No.
Well you look great though. You're pulling off the 90s vibe making me look cooler than I'll ever look just to be next to you.
She's fabulous. She'll help you out with how to save the money, how to budget the money.
I'm going to help you out with how to make more money. That's our combo today.
You ready to go? Let's do it. All right.
Kayla's up first in Jackson, Michigan. Kayla, how can we help today? Hi, thank you for having me.
You bet. What's going on? So my fiance and I combined are about $56,000 in debt, and I'm wondering if we should use his retirement.
I'm not exactly sure how much is in it,

but it's somewhere around $50,000 to pay that off.

Oh, man.

So these are retirement funds.

It's not just money that's invested in a brokerage, correct?

I believe so.

Okay.

When's the big day?

March 29th. So right around the corner.

Yeah.

Okay. So split up the debt for us.
Whose is whose? So we both have 16 and some change in student loans. I have $3,500 on a car, and he has close to 20 on his truck, which we're probably planning on selling.
There we go. Okay.
That's a good move. All right.
Like, I love the fact that you guys are looking at this debt and you see that it's an issue. I think that's a green light.
That's a plus. I would not use the retirement to pay this off.
The retirement is there as retirement. If you pull it out now, you will be penalized for it.
You'll pay taxes on it and you'll have to pay a fee because you're pulling it out before 59 and a half. So for that reason, I would not do that.
At this point, even though the wedding is just around the corner, I would focus on you two paying down your individual debts with your individual income. And then when you do get married, you can come together and tackle this right now.
Yeah. If I'm your, your fiance, I would look into selling that truck.
Do you know the numbers around it? Do you know what he could sell it for a private sale? We're looking into it and I think he'd probably be just a little bit upside down on it. Maybe like a thousand or 2000, something like that.
Yeah. And if I were him, if I could save up that one or two thousand really quick, plus another two or three just to get it junker, I would.
Do either of you have money saved that's not retirement, even if it's just a couple of thousand or a couple of hundred? Yes, but I'm going back to school soon. So we're trying to pay for that without taking out more debt.
What are you going back to school for? Well, I'm not in yet, but I have an interview for x-ray and sonography soon, so hopefully one of those two. Nice.
What's that going to cost you? Total program? Somewhere around $20,000. And what are you doing for a living right now? I'm painting.
I just have done it throughout college, so I'm just doing that. Like art or interiors? Yeah, like abstract art or painting people's houses? Like commercial painting.
You know, the reason I'm asking this question is I'm going to challenge you that starting off this marriage debt-free or with very little debt is going to be so much more relaxing. You know, it's funny.
You posted an Instagram reel today of you and I together on this show. and I was talking about the young man, I was telling him,

you need to learn how to get out of your parents' house and learn how to live on your own. Because when you get married, what's going to happen is you have these two individuals that have grown up in two different households and there's a lot of culture shock.
Yes. Yes.
And I'm just going to bring that back up because it's fresh. Yes.
I want to get Jade back here involved, Caleb, but I'd like to see you use that money to knock the debt off and let's hold off on paying your way through the school. I just think life, do you agree with me on that? I couldn't agree more.
Take the reins from me on this. I couldn't agree more.
And, and you're, instead of surrounding yourself with financial

problems, I'll put that in quotes because going to school is a good thing, but the 20,000 that

it will cost is a problem right now. Instead of surrounding yourself with more problems,

it's really focusing on one thing at a time and saying, okay, out of the two issues,

paying for school and the current debt, what's the biggest, most burning priority? And the truth is it's the current debt that you have is the biggest priority. Because how old are you? I'm about to turn 24 and he's 23, which is why I thought about the retirement.
You don't want to do that. You're robbing yourself.
You're just going backwards. Yeah, you've got time.
And that's the one thing I want you to take away from what Ken and I are telling you, you have time. You.
Yes, the debt is something that needs to take care of to be taken care of. But it's not to the point of doing something extreme and making a further mistake like taking out your retirement.
And that's the thing. Can I think that people have to be careful of? And Dave would say it like this.
You know, when you get desperate, you know, you start getting stupid. Right.
And so you've got to be careful. Right now you feel desperate.
You're like, oh my gosh, look at all this debt. Don't turn around and do something stupid trying to solve for the desperate.
Okay. We ask you Kayla, how much cash you have set aside for school? Together right now we have 12.
Okay. So doing the numbers here, you said you guys have collectively 54,000.
I'm going to keep it at that because you're going to be married. By the time you split this out and try to take it on your own, you're basically going to be married.
So let's say you got 54,000. 20 of it is your fiancé's truck.
That takes it down to 34. If you put 12 on it, that takes you down to 22.
Boy, that's really doable. I mean, I'm looking at this.
Yeah, Ken is right. The truck gets out of the way.
Your husband does that. He starts working on that today, right? Why not? You can take the $12,000.
You pay off your car. How much is your car payment? Mine is like $135,000.
Okay, now you've got another $135,000 back in your month-to-month budget. What's his truck payment? $300,000.
Okay, now you've got another 135 back in your, you know, month to month budget. What's his truck payment? 300.
Oh, look at that. That's a big, big raise.
Yeah, you're creeping up on 500 extra dollars every month. Then you take the rest, the other 8,000 that's left, you put it on your student loan.
And that's how this works. And before you know it, you're going to be out of debt.
This $56,000 debt problem is going to be gone, I predict, in one year. Oh, 100%.
And then come this time next year, you're going to be paying for school and you're going to be so much more peaceful. Imagine studying without debt, Kayla.
Imagine taking your exams without thinking about making your car payments, right? That's what I'm talking about. So I want you to get there and make sure no matter what you do, you keep $1,000 set aside as your baby step one baby emergency fund.
You need that there in case something happens, but everything else needs to go to the debt. Yeah, I agree.
It's not what you expected, but I think it's the best plan, especially being a young married couple. I mean, it's just going to make marriage a whole lot easier as you experience that first year of just learning how to live with somebody else.

And it's a lot harder than anybody tells you, by the way.

So don't add money complications to it.

Great first call, Kayla.

All right, quick break.

Jay's going to tell me more about 90s fashion, and then we'll be back.

This is The Ramsey Show.

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Welcome back, America.

You're joining the conversation about your life here on The Ramsey Show.

Ken Coleman alongside Jade Warshaw.

So happy you're with us.

888-825-5225.

Investing can be overwhelming and certainly confusing. And it's not something that a TikTok

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So this is a great event, two-night event, starting tomorrow.

And you're going to learn a lot.

And I'm going to tell you something.

If you're out there and you're going,

I need more Munyon in my life.

Come on, Ken.

Then this event is for you.

Trying to get that Munyon.

That's what I'm talking about, Ken.

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Munyon is money for anybody who is not in the know i know this i'm hip i know these things i just use words like that i forget that people aren't as up with it yeah yeah yeah we got to keep up with you ken i know i'm trying to stand on business as you told me are you am i are you trying to stand on business i'm not sure if i know how to use that one i'm still working you hold that thought you what where is she going oh no james i'm not sure what's happening right shut up are you for real right now you just pull out a hat that says standing on business i got that just for you kim you stash these yeah i knew the time would come when you would be ready. To say, listen, this was not planned.

I knew the time would come.

And now... See what kind of lid...
I'm telling you, I'm rocking that lid right there.

And now whenever you're ready to go on one of your rants, I want you to put that hat on.

All right. Well, I'm going to keep it on the entire segment.

It's not... I'm not a fan of black and red, but...

Listen...

I'm going to go with it.

I like it.

All right. Very good.
Let's see how I do with this, James. This is all very exciting.
I love so much of this. Let's go to Caleb in Salem, Oregon.
Caleb, how can we help? Hi there. Thanks for taking my call.
You bet. What's going on? My wife and I are 26.
We have two kids, two and under. And my instinct is to have no life and pay off our house as fast as possible.
And she wants to live reasonably. And so I was wondering how you balance the gazelle intensity as you step into 4, 5, 6.

All right, I'll tell you what.

I think the best thing to do here, Jade, is to go right to Caleb's wife and what she thinks is reasonable.

In other words, she wants to live some life.

You don't want to have a life.

So what is her definition of have a life?

What does that include from a budget standpoint, and where does that challenge you? Let's get real about this. Sure.
I guess she's working full-time now as a paramedic, making about 90, and I'm salary and supply chain at about 60. Great.
150 joint income. That's good.
We're pretty comfortable, but I've considered moving to a different job that might pay more, but it would not allow me to be as home as much. How much more? How much less, yeah.
Probably 80, maybe 85. And then how much less would you be home so right now i i work hybrid i'm home working from home two two to three days a week but my work lets me pick my hours and i can be flexible around my wife's schedule So So it would cause us to have to do child care, which we don't, and just make things more complicated.
All right, and so the only debt you have is the home? Correct. Oh, bro, this is easy for me.
I mean, you've got to find a way to make some more money somewhere else because if it throws the family dynamic off as much as it sounds like and they incur more expenses for child care. You could easily end up spending that $20,000 a year taking care of these kids.
Yeah, so I would be patient. And this is happy wife, happy life.
But this is also, to Jade's point, she got to it faster than I did. But this is a net-net.
It's not like a whole bunch of wind for you, a financial windfall. So I would just be patient, man.
You've got a good joint income. How soon will you pay the house off if you just stay at the current rate? We're projecting around six years.
I wasn't sure if that was too long or to do it. Bro, that's phenomenal.
phenomenal. That's amazing.
How long were you in Baby Step 2? I'm just curious. How long did it take you to pay off whatever consumer debt you had? We've never had debt.
We've been married. We both cash flowed our two-year degrees from the fire department and me through a charter school in high school.
So We've been debt free and my work paid for us to go through FPU. So we've just been...
What do you owe on your house? About 280. You know, it does bring up an interesting conversation.
So obviously the way we teach the baby steps is baby steps one, two, three. Those are, you move intensely, right? That's gazelle intense.
You're going fast. You're sacrificing.
You're doing whatever it takes to get this debt paid off. But then when you move into baby steps four, five and six, particularly when it's time to pay the house off, that's the time where we say, hey, you don't have to be intense anymore.
It's really about being intentional and you're moving methodically with intent toward paying off the house, right? It's not you sacrificing everything, right? But in cases where I kind of am willing to play the game a little bit is in cases like yours where it's like, listen, we never had debt. We never went through a season where we were really sacrificing to win.
We never needed to. And I say kudos to you for that.
But in those situations, that's the time where I'm like'm like listen if you want to get a little bit more intense to do it I'm not mad at it I don't

think the means that you stated earlier was the way to do that but um it would have been one thing

to me if your wife was like listen man we just spent three years you know in the trenches I want

to take a break but in this case you really didn't and if you wanted to get more intense

along with your intentionality I don't think that's necessarily a bad thing when you haven't gone through that baby step two situation. I agree, but not at this particular option.
Not in this way. Because now you're increasing your expenses to take this opportunity.
And just by the way, challenge us on the numbers off this call, right? So take the $20,000 gross that you're going to make. So we know you're going to take taxes on that.
So run your taxes on that. You have a pretty good idea what that is.
Okay. And then you look at the increase in childcare and you start playing that out.
And so that's how you just walk through these decisions. If you had said to us, Caleb, I'm going to make an additional 20K, keep the same schedule, get to work at home.
Then I think it's a very different conversation. But man, you're in good shape and listen to your wife on this one.
Yeah. Yeah.
If you don't listen to us, listen to her. Perfect.
I love you. Yeah.
You the man. I appreciate that.
You know, fascinating. I love to hear a young man who's going, I really want to pay this off.
And he's, and hold me back, Jade. Right, right.
Hold me back. Like, am I doing? And boy, as opposed to the opposite effect, you know, where people are just like, oh, they're not even thinking about it at all.
They aren't willing to sacrifice. Really interesting way of coming at this.
It is. It is.
And I think it's worth that conversation because, yeah, when Sam and I, after we spent seven and a half years paying off our debt, I was, I, we're weary, right? At that point, like the last thing you want to do with more intensity, you'd have been like, Hey man, listen, I tried to do it. You tried.
I tried a couple of times to go really hard on something. And Sam's like, I need you to calm down.
He's out there. He's like, yeah, I see him.
I see him too. He's like, I need you to calm down, Jade.
And it's true. Even if you've done an intense two-year battle, right? And I think that's why the baby steps are the way they are because we need a break.
We need a breather to live and enjoy life. I can't believe you just pulled the Standing on Business hat out of the, for those of you that are watching on YouTube, you have to check it out.
You made these hats? Yeah. Yeah.
All for that moment. Yeah.
How funny is that? This originated with Sam Warshaw. He was like, we need to get Sam a standing on business hat.
We need to get Ken a stand on business hat. Well, there's two of them, so I think he and I will sign them to each other.
There you go. And they'll just be bros.
That's right. But you got to pull that out when it's time.
Yeah. Sam, you and I, a stick with these hats.
We'll smoke a stick soon on that. All right.
Quick break. We'll be right back.
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I'm Ken Coleman, Jade Warshaw is alongside 888-825-5225 is the phone number. Laura is joining us now in Los Angeles.
Laura, how can we help? Hi. My husband and I already know a lot of debt from a small business we started, and I need you to guide me how to get out of it, I guess.
All right. Give us some numbers.
Okay. So we're talking, if we're combining personal and business, it's about like $150,000.
Okay, how much is from the business, though? I'm just curious. Well, I would say all of it because we put in from personal into the business, but just the credit cards would be like $90,000.
Oh, okay. And what rest of the, the debt? They're all credit cards.
All of it's all 150s on credit cards? Yes. Oh my word.
We even opened up personal loans to pay for the credit cards so we can have more space for the credit cards. It's a mess.
So how many credit cards total? I would say there's about seven. Seven.
And then you said you have personal loans open too. Is that included in the 150 or is that, what is that? Yes.
That's included in the 150. Okay.
So your thought is like, hey, we use these personal loans to pay down the credit card to clear up more space so we can borrow more on the credit card.

Exactly. What's your income situation? Are you guys still working in the business? No, no.
It took us a while, but we brightened up to close that business. Well, it's still open, but it's not running.
Okay, gotcha. So what's your income? My husband makes about, I would say, $120,000, and I make $80,000.
Where does that money come from? We each have jobs. Got it.
Okay. So we've got $200,000 combined income.
Correct. Okay.
Do you have any other debt outside the $150,000? I know she asked you that, but I'm just totally clarifying. This is all of your debt.
Well, yeah, we have a mortgage, a car, if that's what you're asking. Yeah, we want to know.
Total debt. So tell us about your cars, your student loans, anything that you owe money towards that you make a monthly payment towards, we want to know about it.
So go ahead and tell me your mortgage. I'm just curious.
What do you owe on it? I would say we owe it like $400,000. So monthly, I paid $3,300 for mortgage.
The car, I paid $700 a month. I think there's like 19,000 left on it.
Okay. Uh, we, we have a leased car that's $400 a month.
My son's school is 850 a month. Um, my school.
Is that private school or is that daycare? Private school. Okay.
How old is he? Four okay keep going my school one is 400 so our personal loans his is 1600 a month mine is 850 a month okay and how much but that personal loan is included in the one 50 you told me earlier. Yes.
Okay. Tell me, um, when you guys get your paychecks, like after everything's taken out, what do you take home every month? What's your check look like? Both of you combined? Mine, uh, yeah, mine is about 2000 and his is about, oh no, that's on every other week.
So $4,000 can mean about $2,000, and his is about, oh, no, that's on every other week.

Okay, so $4,000. So $4,000 is about $9,000 for him.

Okay, that's the good news.

So $13,000 net.

And just a real quick question, I don't want to get bogged down on this, but why is the

four-year-old in a private school?

Because of, I don't want him to learn anything that right but is it pre-k yes okay so it doesn't have to be in pre-k um i'm just wondering i'm right out of the gate there's some money to be saved on some home care maybe versus but i i don't there's bigger issues going on, but y'all gotta cut back big time.

Big, big time. There's the bumper stickers that Jade's about ready to walk you through.
Well, I think that's, I mean, jumping off with Ken's point could be a good place to start. You know, the only way to get out of debt is there's two methods you could invoke here.
You could work more, right? To have more margin. You could also cut back on your budget to find more margin, or you can do a combination of both.
And to Ken's point, that school might be a great place to start because I don't know what you were going to say as far as like, I don't want them to learn certain things. It might be some of the same feelings that I have, and my kid is in private school, but for right now, it's okay.
Or they're in day private school but for right now it's okay or in there in daycare and for right now it's okay so it might be worth it for you to invoke that when they get a little bit older could be that it's your kid yeah I was gonna say yeah and I might step on toes here but since we're here I'm gonna go ahead and say it because I know a lot of Americans are thinking this so I'm gonna go ahead and say it get might have to put your hat on. I don't remember anything from my 12th grade year.
Your four-year-old, no matter what they're trying to teach the kid. I mean, I get it.
I'm not in LA. I get it, but I don't know.
I would be looking to save $800 a month tonight. Yeah.
I mean, at the end of the day, what matters most is what you teach them at home. Yeah.
But again, I know we're really getting into your personal life.

I know.

And I got to be careful.

I'm not judging you.

I'm just saying, you know, the four-year-old, we could cut that.

That's $800 a month.

That's $9,600 a year.

It's a lot.

For where you're at right now, it is a lot.

We just want to highlight that it is a lot.

Next thing is I'm looking at possibly both of these cars. I want to know about how you can get out of this lease.
When is this lease over? Um, very soon. I would say like four months.
Okay. And then your option, you just turn the car in and you're out.
Yeah. Okay.
So I would do that. Don't try to buy back the car.
Nothing like that. Just get out of the lease.
And in the meantime, do you have any money saved? No, everything is gone. Okay.
Then what I'd be doing, knowing that this lease is about to come up, I'd be like, we got to stack up $3,000 because when this lease goes away, we need to be able to buy a car in cash. And that's what that that's kind of the car plan.
So write that down in your notebook as when we turn in this lease in three months in three months we'll also be buying a three to four thousand dollar car i know you have the margin in your budget to do that okay so that deals with one car let's talk about the nineteen thousand dollar car do you know what that car is worth the payment was kind of high didn't you say it was like seven hundred dollars yes it's I think we bought it at $50,000. Okay.
Do you know what it's worth now? I don't. Okay.
That's your second piece of cart homework. I want you to go on kellybluebook.com, look at private sale, because it sounds like if you bought it at $ and judging by the height of your payment I feel like

you've been paying this off kind of fast is that am I wrong no you're yeah you're right okay so you might actually you might not be upside down and if you're not I would still get out of this and get into something cheaper because the 700 payment you need that money and so now we've just found $1,100 in in your budget with these cars, and you need every dime of that to go towards paying off this credit card debt. The good news is, I mean, you guys have a good income.
It's not wonderful for LA, but it's wonderful for the rest of the country. Yeah.
And it's doable. And again, not telling you what to do with your kid in school, but if we take the $800 on top of that, now we're right at the doorstep of $2,000 that we found in your monthly budget.
That goes a long way to paying off $150,000 in debt. Okay, because now you're looking at if we just take $2,000 a month that you found and you put it towards debt, that's $24,000 a year.
That's a long haul, right? And this is a drastic change of your lifestyle. You're not going on vacation.
You aren't going out to eat. You guys are going to have to really hustle.
But again, my co-host today, this is a woman who her and her husband paid off half a million dollars. She needs a little pep talk as we go into the break here because

mindset wise, what has she got to be thinking right now? You've got to be thinking. The hard part is you're making a good income and to not be living in that income feels like, oh man, I've been working hard.
But the time will come when you do get to do that. So just hold on.
If you clean up this mess, you're going to enjoy your income like you never have before. Right now, you've kind of faux enjoyed it with all these things on payments and it's not all it's cracked up to be.
But if you walk through this journey, you're going to get to enjoy the fruit of $220 plus thousand dollars a year with no debt and payments. You can send your kid to the school that you want to and you don't have the stress associated with it because you'll actually be able to afford it.
You can do it. You can.
Appreciate the call. All right, quick break.
Jade Warshaw, Ken Coleman. This is The Ramsey Show.
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You're listening to The Ramsey Show. So excited that you are with us today as we help you win with your money, win in your profession, and win with your relationships.
888-825-5225 is the phone number. We'd love to hear from you.
We go to Paul, who's right here in our backyard, National Tennessee. Paul, how can we help today? Hi, how are you guys? Doing well, sir.
What's going on? So, I am 22 years old, about to turn 23. And so as my wife, we recently just got married about six months ago.
Um, and I knew before we got married that she wants to be a stay at home mom, but I have no idea how to, um, have a career or a job or whatever to support that kind of thing. I'm a college dropout.
And so I'm trying to figure out like how, how does one have a career? Good. Well, I'm a college dropout as well.
And so I want you to stop saying it that way the rest of your life. I want you to stop saying it the way that you said it.
And I'm not criticizing you. I'm actually going, Hey man, everybody's got their story.
Everybody's got their reasons for it. That does not limit you.
And so I want to make sure we get our shoulders back on that, okay? So I'm a college dropout, all right? And so I'm not going to let you talk about me the way you talk about you that way, all right? Okay, Ken. You got this, Paul.
All right, so let's talk about real numbers, all right? So she wants to be a stay-at-home mom. Love that.
It's the greatest job in the world. Mad respect for it.
My wife, Stacey, was a professional, made really good money, and then she's been at home for a while. I got mad props for that.
How much money? I think you've got a number in your mind, or let's come up with a number. If you earned X amount of dollars, that would replace her income at the minimum.
So what's the number? We don't have any kids right now, but to just stick her at the house, I would have to be making 85, but to have the amount of kids that we want, I'd probably have to be making 150 to 200. How many kids do you want? Maybe.
She wants five.

Oh.

Lordy.

Hello.

Well, so are we trying right now, or is this just something we're talking about?

No.

Because we've been married six months.

No.

Okay, thank the Lord.

Yeah, no, we're not.

We are.

Yeah, y'all need to slow your roll and learn how to be married, for heaven's sakes.

You've been married six months.

Yeah, we're waiting like five years to have kids.

Oh, well, let me also say, you know what, Paul, let me just tell you. All those plans are great.
You have no idea what's in store for you. No idea.
You have zero idea. So let's focus on what we know.
She's in a job right now, correct? Yes, sir. And she's not coming home anytime soon because there's no reason to come home, correct? Yeah.
What's she earn? Take home is $33,000. Okay, great.
And what do you take home right now? Oh, $33,000. I take home, yeah, $33,000 a year.
Okay. So you guys are fine.
You're 66 take home. That's not bad at all.
You guys can stack cash. Do you no debt i we made sure to i made sure to pay all my college debts off all right so i'm going to bring jade back in in just a minute to pick you up right where you i just left you but i want to talk about what you want to do i think this is what i've been doing for years is coaching people to find work they're wired to do i'm going to give you at the end of this phone call my best selling-selling book, Find the Work You're Wired to Do.
It has the Get Clear Career Assessment in it, okay? And I want you to take it, and then I want you to read the book because the book is me coaching you along with your assessment results. But let's just see if we can get a couple ideas, because I just believe, Paul, that you know what it is, or you have a couple ideas of something that you would like to do.
And if I could wave my pencil and go poof, and you were doing it and making the money you'd like to make, what is it that you would like to do? Any ideas? I would want to probably own a real estate and or logistics company. Great.
And why logistics? What about logistics intrigues you? I've just been kind of good at it, and it's fun. Maybe that's weird to say, but it's fun.
No, it's perfect. My assessment measures three things, Paul.
What you are good at doing, you just said you've always been good at it, and what you love to do. That's amazing.
I love to do what I'm doing right now. It's fun.
It's really fun. So that's not weird.
So logistics has got a lot of application to it that's very versatile in the world of work. Because if you're good at logistics, there's some operational roles.
A lot of ways you can go with that. And then real estate, if you're smart, you transition to that over time, that's great.
So what's keeping you from moving into logistics over the next year, two, three? What do you think is missing? Do you have to have a degree to work in logistics? I mean, I work for a logistics company right now. We supply apartments, but I don't really know what to do to get into the logistics space.
Okay, let me ask you a question. Since you're in logistics right now, who at your current company would be able to answer that question about what would it look like to climb the ladder into logistics? I could probably find some people on our company portal that I could probably email.
Yeah, think? Oh, Paul, I'm going to give you the magical key that most young people never discover. You ready? Mm-hmm.
You find out who are the logistics veterans in the company portal. You send them an email or a chat or a voicemail, and it sounds kind of like this.
Hey, so-and-so, my name's Paul. I'm a young guy who would love to get into logistics.
I've always been good at it. I really love it, but I need someone with experience to just give me their wisdom on the multiple ways that I can grow and climb the ladder in logistics.
Would you be willing to spend time with me if I bought your coffee or lunch and And you just rinse and repeat until you get somebody to do that, and then you actually pay attention to what they tell you. And then go find some other things.
Go down message boards in logistics. Listen to podcasts.
Find everything it is about logistics that are out there. And believe me, it's out there, and you figure out how to get there.
Now, once you know that that's a good move for you, my assessment, the Get Clear Career Assessment, will help you with that, and it's going to validate all the stuff we're talking about. Start moving forward with that.
By the way, Christian, let's also give him a copy of my book, No. 1 Best Seller, The Proximity Principle.
I'm just piling it on, the young man, because I want to hand you over to Jade. We've got a couple minutes, and I want her to walk you through how you will get ahead financially now that we're going to have a path and we're going to be making more money, how we plan for little ones and mama to come home down the road.
Yeah. I want you to have a clear picture in your mind by the time you leave this call.
Ken gave you the career piece. So let's talk about what it could look like.
So you've got kind of a five-year play here, right? There's five years where both of you guys are in the workforce. During that time, you're getting your income up.
It's 66 now. You know, by the time she takes the baton or you take the baton from her, hopefully you're carrying that on your own and more.
So the key here is the house. Like that is the key.
That's the foundation of all of this. If you can set yourself up, you don't have any debt right now, right? If you can get into a house and you're already projecting saying, okay, this house, it can't be more than 25% of our take-home pay, my take-home pay, because you're going to be the only one working.
So at this point, let's say you're making $66,000, right? You're carrying that on your own. Okay.
Payment can't be any more than $1,200, right?

That's the max. So now is the time to start saving towards that and making that happen, right? That you've got five years to make that happen.
And then once you're in baby step four, you're saving, you're putting aside 15% of your income. That's 825 bucks a month from now until the cows come home.

I mean, if you just did that on one salary with your kids, like you could retire with $5 million. So this is the picture that I want to paint.
You're creating stability by your home. And by the way, when you get that home, it's got to be based on your income, not both of you together, just what yours is.
That's going to be the key to this. And then from then on, it's it's got to be based on your income not both of you together just what yours is that's going to be the key to this and then from then on it's it's you guys making uh ken how can i say this delicately a lot of times folks call in and the the childbirth has kind of taken over all other thought process yeah and it's like you just have to understand that kids are expensive and they're not getting any cheaper.
So you guys might get to three babies and go, oh, okay. Well, it's really hard to make current decisions on hypothetical future decisions.
And what I mean is what you're saying. Sure.
I understand we want five kids is what she's saying, but we don't know how that's going to happen. Yeah.
You may look at the situation and go, okay, I haven't gotten quite to 66,000. I'm at 50,000.
How does that play into this? And that's okay. A lot of life happens between now and five years from now and everything we lay out, it's awesome, but life has a real weird way of never turning out exactly the way we plan it to.
So that's why you want to make these great money decisions now and then deal with what happens when life throws it at you. Great hour, Jade Warshaw, always fun.
This is your show. It's the Ramsey Show.
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That's healthtrustfinancial.com. This is is the Ramsey Show where America hangs out to have a conversation about their life, specifically their money, their profession, and their relationships.
Alongside Jade Warshaw, I'm Ken Coleman. 888-825-5225 is the phone number to jump in.
She'll coach you up on saving money, budgeting money, investing money. I'm going to coach you up on how to make more of it, as the young people call it, munion.
Munion. This is a new term I learned today from some high schoolers.
I can't wait to drop that on my kids. Oh, they're going to love it and hate it.
And see how fast and hard they roll their eyes. As my daughter likes to say all the time, you so cringe dad oh man you know make a meme out of

it yeah and it's it's what i'm supposed to do it's part of the role of a dad uh but we're here for you america you ready to go i'm ready all right she's ready folks sarah is up in miami florida oh near your old stomping grounds you like that sarah how can we help hi guys thank you so much for having on.

So my parents opened up a credit card for me when i was younger um in my name uh so right now the card has about 18 000 in debt um and i want to know what's the best way to go about paying it off um they've already agreed to help me pay off since it's the three of us uh our charges are on it. But I want to know what's the best way to go about it.
So the $18,000 isn't just your spending, it's your parents' spending as well? Yeah, the three of us. Oh, wow.
Okay. Do you know who spent what? Do you know who's on the hook for how much is there a spreadsheet um uh in november we had a trip um where they put about five thousand dollars in charges and then it's been open since i think i was 16 so i can't you know exactly point out who has what but i pay off yeah i pay off um every month like what i put on obviously i've stopped now just because we're trying to pay it off so there's no more charges going on to it but i want to know what's the best they've agreed to pay it off so they've put money on it but it's just 18 it just seems so huge to me who's the who's the primary who's the primary on it are you the primary and they're the cosigner or how who's who's in charge of it um my mom is the primary okay can my first order of business would be for me to be taken off of it just from a credit perspective just from a responsibility perspective um this is you doing damage control, saying, hey, the truth is, and I'm not saying you say this to her, but I'm saying this to you.
The truth is they pulled this debt out in your name before you were of age to even be able to make the decision to say yes or no. That's the truth.
16 is not the time for you to be deciding if you should have credit card debt with your parents. The answer would be no, but you didn't know that.
Okay. So first order of business is mom and dad.
I need you to take my name off of this and I want my name off of this. So that's numero uno.
You do that tonight. Because the truth is, how old are you? We're down 26.
Yeah, you're 26. And the truth is one day you're going to want to do something that requires your credit score to be zero.

And as long as this is around, your credit score can't go to zero. Right.

Which is what we're trying to get to. So that needs to happen.

And then after that, you can say, OK, let's look at the charges are let's look at what the charges are now and let's go through and let's kind of itemize this thing.

And I'm fine with you going. This was me.
I will pay that. And this was not me, I will not pay that, right? Now, if we're trying to play a chess game here, it's really important that you get your name off of this thing first.
Yeah, I was going to ask, I love the advice. Do you think that's going to go down okay, Sarah? I'm curious.
Yeah, they're pretty reasonable. Okay.
Because if you start talking about what you're not going to pay, they may not want to take your name off it. I think Jade's exactly right.
Is there any way, and you have to forgive me, I really don't know this. I still know.
Yeah, what? Can they, how far back can they track? Can they track the expenses over the lifetime of this card? Or is that like going to some like credit card database? I think that would be hard to do. I'd probably go back $18,000 worth of charges.
Because the thing is, they've been using it, paying it off, using it, paying it off. So as it stands now.
Okay, so of the 18, that's what I'm asking. So of the 18 that's on there now, it's like a fresh start.
Can they track that? They being Sarah and her parents? The credit card. Oh, yeah, they probably could.
Does the credit card have a, obviously it's a website, but does it have the capability that she and her parents could go in and they could get an itemized list of the current 18K, this is what it's made up of, so that they can divvy it up? I mean, yeah, you could do that. I know that's a it up i mean yeah you know that's a dumb question my guess is probably three months of expenses is probably 18 000 because they spent 5 000 just in november right so you could probably just pull up the past you know three or four month statements and the reason i'm so hung up on that sarah um jade's advice is absolutely stellar and to the extent that you can find out what is yours and you and mom and dad are all mature and we go, okay, this is our chunk and this is your chunk.
And let's say you come back and I'm making this up, but let's say your chunk is half of it at 9K. Now, because you're off the card and what you're going to do is you're going to pay 9K to mom and dad to put on the card.
Hopefully they'll do that. Hopefully they will.
But that ain't your problem and you will come to an agreement mom and dad I owe you nine thousand dollars and I'm going to make that right. So whatever the number is that's what we want you to do and that's going to make this clean from a boundary standpoint for you which is really important.
Really really important and the hard part is you know I would tell you, like if for some reason you ask them to take you off and they give you a problem, you could contest it like with the with the credit bureaus and say, hey, I got this when I was a minor. The hard part now is you have been spending on it and it's kind of been you've OK'd it from a certain perspective.
So I really would. It's all going to melt down to how you have this conversation to get them to take you off that's right but yeah that's a good idea i'll definitely do that um i just have one more question um i am worried about my credit are they but when they take me off the card will my credit be impacted um it probably i don't want it to go down that's the part where I'm not exactly sure because you're not disputing it.
You're not saying, hey, this never happened. It'd be one thing.
That's why I said, if you went to the credit bureaus and said, hey, they did this when I was 16, I didn't give them consent. Yeah, then it'd almost be fraudulent and they'd take you off and for you it'd be like it never happened.
But I want you to coach her up on stuff that she just said. She didn't catch what you said earlier.
She said, I don't want my credit score to go down. You want it to go to zero.
Give her the quick pep talk on why. I don't think she caught that.
Am I right, Sarah? That's very good. You need to hear this.
This is important. So the key is for your credit score to go to zero, not necessarily to go up.
So the truth is, if you've had any sort of debt that you were using and you pay it off and you close it out, or in this case,

you get it off of your credit report, it could impact your credit report. But over time, when you stop borrowing money and there's no open accounts on your credit, your credit score is going to go to zero.
And so if that credit is the only debt you have, once your name is removed off of that over time, in a very short period of time, six months to a year, your credit score is going to roll to zero. And a zero credit score is just as good as a high credit score.
Okay. That's the one thing they don't teach you in school.
They don't teach you on the internet. They don't teach that because nobody benefits from that, but you, no company is making a bunch of money on that, but you, okay.
That's why they don't teach it, but it's absolutely true. So that's what're working towards.
Get this in the motion. Get it happening.
Get your name off of it. Don't borrow any more money and you'll be good.
You got this. I think a lot of people don't realize you can buy a house with zero credit score.
Yes. You can live life without a credit card.
It's all very doable. If you want to know more about that, just go to RamseySolutions.com and search.
We've got articles on that. People think we make it up, Ken.
No, it's a real thing. It is doable.
So Sarah, you got this, kiddo. Thanks for the call.
We're rooting for you. All right, quick break.
We'll be right back. This is The Ramsey Show.
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Welcome back to The Ramsey Show. Alongside Jade Warshaw, I'm Ken Coleman.
888-825-5225 is the phone number to jump in. We'd love to have you.
Palm Springs, California is where Jenny joins us. Jenny, how can we help you today?

Hi, hello.

I'm a 90s kid, by the way.

Nice.

Come on, Jenny.

My parents are getting old.

Love it.

My parents are getting older, so now they're in their late 70s.

They've done well for themselves, but now I'm helping them because I noticed they were

paying quite a bit of money into a flexible, premium, adjustable, universal life insurance

that they've had since 1986. Oh, man.
That thing's got mold on it. Well, my dad worked in law enforcement, and his initial hourly rate was only $4.80.
Wow. So it made sense to them back then to have this $100,000 policy for him because, you know, you don't know what's going to happen.
But after doing some research i've gone back and forth the policy has been sold from company to company they don't even have the records for this policy because it's 39 years old and their cash value has basically depleted my mom's very what is it do you know what it is the cash value um oh yes so the first well the cash value now is $1,000. Oh, my gosh.
And they've been paying into it since the 80s, basically? Yes. Oh, Lord.
Basically, they've totally paid $48,000 from their money into this policy. Okay.
And so they have three different, well, one policy is $25,000, two riders, one for $50,000 and one for $75,000. So basically $150,000 for both my parents.
Right now, what happened was they said, oh, you stopped paying your payments. But my mom said, no way, I've paid my payments.
She's paid over the amount over all these years. And basically what happens, and I've been researching, so it's imploding on itself.
So now their cash value is gone. And my question is right now we're at a level playing field.
Do they stop paying this? I'm trying to get the answers from somebody. They won't give them to me.
Well, let's find out. What's the rest? Tell me more about their financial setting because the hope is that you can get to the point where you're self-insured.
That's the hope is to get to that point. So tell me more about their finances aside from this universal life.
Do they have a nest egg? And if so, how much is that? They've owned four homes. They currently own three homes, but my parents being the great people they are are leaving those homes to their children.
Okay, what are they worth? So they won't sell those. I would say they're probably worth a million and a half.
Okay, so $1.5 million. Do they have debt on them or are they cash, paid for cash? No, they only owe a little bit left on one home.
I think $25,000 left on one home. Okay, so essentially paid for.
So three homes worth $1.5 million. Do you know what their nest egg is that's in the stock market?

Savings.

They don't have stock market.

My mom didn't come from that era.

She didn't want that.

So I think in savings they have liquid about $250,000.

Okay, $250,000 cash.

Okay, so they're millionaires.

They're doing fine.

I mean, is the assumption that these homes

are going to continue to go up in value they've been taken care of oh yes okay so there's worse things that could be going on here um the chances of them you know going out and getting a term life insurance policy for anything reasonable at this point you said they're in their late 70s it is not happening right so the

best you can think through is okay if one of them were to have an event that was not paid for if any of one of them were to go into assisted living is there money to pay for it and the other spouse the remaining spouse still have money to live off of that's kind of the equation that you're doing in your head, right? Yes. Okay.
So a couple of things that I would do for that to be more of the case. Of this $250,000 in cash, I would want to invest some of that because I'd want it working for me.
That's a big chunk of money that should be making. I mean, over the last three years, if that had been invested, the rate of return would have been unbelievable on that.
But just even in a normal market, in a normal market, you're looking for at least a 10% annualized rate of return. That means if we look back on the track record over the course of, you know, five or six or 10 years, we're looking at 10% is that annual, annualized percentages of.
So that $250, if you can talk with them and say, here's the truth, and I didn't ask you this, I guess I should, are you sure that this is their only life insurance that they have? Or is there another policy or something else laying around? I am pretty sure. So I'm not very smart on life insurance policies, but once you stop paying, they're gone, right? Yeah, if you let it lapse.
Well, if you let it lapse. Yeah.

How old are they? My dad's 78 and my mom is 75. I just don't think they need insurance at this point.
I think they're okay. Now, well, I mean, here's my thing.
With all those houses and then what's beyond the house? They've got 250 cash, but I'm always looking at what if one of them becomes very ill and they need assisted living or they need somebody living. That's why I'm with you.
I'd invest that and I would use that as like that. That's that fund.
That's the fund for that. Here's the thing.
I don't know. What are they paying a month on this coverage? It's $100,000.
What are they paying on it? So she's been paying $185, and their premium was only 50... Yeah, it's peanuts.
54. Yeah, it's...
But that's what I'm... Now that their cash value is gone, where do all these fees come from after they make their own...
Because it's just a terrible product. Now you get it.
Now you know why we hate it. It's a horrible product.
They got nickel and dime to death on their own cash value. They're not, they're horrible products.
And that's what we try to tell people. You pay into this thing for life and at the end of the day, you have nothing to show for it.
All they have is their $100,000 when they pass away. Which, you know, if they keep it around.
Yeah, if they keep it around and they're like, I'm happy to pay the $185 a quarter or whatever it is. you know i you know if they keep it around much yeah if they keep it around and they're like i'm happy to pay the 185 dollars a quarter or whatever it is you know they're not getting rich off of this thing which is what we've learned and when they pass away you're not getting rich off of it either is what it amounts to and so and here's the thing if they had passed away they wouldn't have gotten to keep the cash value anyway that anyway.
That's the most ridiculous thing about this whole thing. So they're in it.
It's a horrible product. If they want to get out, they can get out.
If they stay in, it's not the end of the world. They've got the money to pay for it.
And in many ways, I guess at this point, it's better than nothing because it's not overly expensive monthly. Would there be a penalty for them to get out of it now? Did they say, okay, we don't want it anymore? Yeah, ask about that.
Ask and find out. At this point, I feel like they could probably surrender it with no issue, but just find out about that.
And push for that. Push for that.
But this $250. I'm trying, and I can't get anybody to help me or help him while we're both here, but nobody will help.
Nobody will answer my questions. It's all, well, we don't know.
We have to look it up and nobody has answers for me. Well, that's because they don't want you to get out of it.
They've gotten $48,000. They got answers.
They just don't like the answers. I would really just put the pressure on somebody and become their worst nightmare.
And you'd be surprised if somebody wants to get rid of you. You can be nice, but you're just like a bulldog.
Yeah, I mean... I'm a 90s kid.
I'm good at getting somebody's work right now.

Come on, you know. You get into it.
I mean. Like new kids on the block, hanging tough.
You know what I mean? That's what I'm dropping. That's our theme song.
Yes, okay. You know.
Hanging tough. I like it.
Yeah, I mean, there's no cash value. I can't imagine what they might charge to surrender this at this point um but check into it and and if if you want to lapse it let it lapse they're not going to get into anything else though at this point is what i'm saying and the good news is they have the money to self-insure but pushing on that 250 to get that invested i would do that if i were you.
And do you know, will the premium keep going up

and up and up

so they get their fees?

Say that again?

Will the premiums

on the whole life

keep going up?

They might.

Yeah.

I'm telling you.

They might.

You can cancel this thing.

Get out of it.

Get out of it.

And if there is a penalty

at this point,

it's like, who cares?

Get out of the thing.

Yeah.

They paid $48,000 into this and they have $100,000 of coverage. That's terrible.
I'm unfortunately at the time of my life where insurance is such a fraud. And I know I'm saying that blanketly.
But after looking at all of this for them, I'm thinking, what a fraud. You could have put that money into something else.
And I don't want to make my parents feel bad about it because they said we were doing what we thought was right at the time. It happens all the time.
That's why we teach term life insurance is the best way to get it. With term life insurance, you're only paying for insurance.
With all these other universal life and all these other, you're giving them extra for them to invest it for you at a horrible rate of return. It's loaded with fees.

And at the end of the day, you end up with nothing.

What these people have ended up with is so typical.

And so your best bet, term life insurance,

check out our friends at Xander Insurance.

They will hook you up.

Yeah, yeah.

And it's peace of mind and it's for the term.

And that's why it's so beautiful.

Once you get past that, you don't need it.

Guess what? You're not paying for it.

All right, quick break. More of your calls coming up.
This is The Ramsey Show. I talk to people every day who want to know how to do better in two areas, money and relationships.
That's why I'm pumped to bring the Money and Relationships Tour to a city near you. Join me and Dr.
John Deloney for a night that will challenge the way you think about this stuff and possibly change how you live forever. Starting April 21st, we'll be in Louisville, then on to Durham, Atlanta, Phoenix, Fort Worth, and Kansas City.
Grab your tickets at ramseysolutions.com slash tour before they're gone. Welcome back to the Ramsey Show.
I'm Ken And Coleman Jade Warshaw is joining me. 888-825-5225 is the phone number to jump in.
We'd love to hear from you. Javin is joining us now in Hattiesburg, Mississippi.
Javin, how can we help? Hey, how are you? Good. How are you today? Doing pretty good.
Okay, so a little bit of background for my question. Me and my fiancé, we recently got engaged back in September, and we are set to get married in November of this year.
That being said, I am very excited, and there's nothing that I want more than to marry her, but I am also very nervous because I've never had to financially lead anybody in my life.

And so I guess my question is, what are some of the best steps that I can take in order to ensure that we'll be financially successful and we'll keep the money fights to a minimum?

Oh, really thoughtful question.

How old are you?

22. Do you have any debt? No, sir.
Does she? So she doesn't have any debt right now, but she's going to school to be a PA, and she wants to go to PA school, but obviously her parents didn't save any money for her to go to PA school, so she's going to have to take out loans, I'm guessing. And when will she start? Right now, that's kind of unknown.
She has been applying to different schools. She did have an interview, and she got waitlisted, so right now it's just kind of unknown.
Okay. Well, I want Jade to weigh in, obviously, on this, but I really thought it was a really mature way of asking the question.
You've never had to lead anybody. And when it comes to husband and wife, the word leading can get tricky for some people, and I think what I'm going to say hopefully helps everybody.
I wouldn't look at it as telling her what to do if that's what we think leading is. I think modeling the way is what I would define as leading when it comes to a marital relationship.
And so modeling the way is you being disciplined with money, you being transparent about money, you being thoughtful about money, you know, just coming at it from a it's a we. And so, for instance, give you a classic example.
Leading her right now would be sitting down with her and going, hey, here's my view on student loan debt and just debt in general. Here's what it does to me.
Here's why it does that to me. And when I say the why, I don't mean like Ramsey bullet point language.
I mean like you personalizing going, I grew up this way or whatever. So that she goes, she feels very safe because you're not talking at her about this.
You're going, here's how I feel about money in general. And I feel as your future husband, that I have a responsibility to lead us is how I would say that.
And, and, and say, I, can we talk about what it might look like to save up and cashflow PA school or, or I'm going to bring you in here because I, I wanted to try to take the, I wanted to give you some wisdom from my, you know, as a man in the marriage, Stacy, very strong. We've always been on the same page about money when we didn't start that way.
In other words, we may start a conversation. We ain't on the same page.
Yeah. Yeah.
When we finished the conversation, Jade, we got to get on the same page. And so I'm bringing you in here.
I'm tagging. This is like a wrestling match.
And I'm tagging you in the corner over there. Okay.
You're jumping off the ring. I'm getting out.
I'm getting out of the ring and I need you to come in because I do want the female perspective as well. Okay.
I'm jumping off the ropes into the ring. Be gentle now.
Don't elbow drop. No, I think Ken is exactly right.
And I think as much as you can, when you have this conversation, Ken is right. Tell her the way that you're feeling, but as much as you can reiterate over and over and over again that you agree she should go to school.
Yes. Yes.
Good point. I agree.
You should go to school. I agree.
I do want you to be, become a PA. I agree.
Your career is very important. I think whenever you're having a discussion like this, the person who's I'll say their thing, the thing they want to do when their thing that they want to do is on the line, it can get defensive easily.
Even if they're, you know, a person who doesn't want to argue, it's just easy to think like, what does this mean? Does this mean I can't go to PA school then? school then does this mean i can't do my dream right so reiterating that over and over is going to be so important and then saying having ideas of here's what we can do yeah i was thinking how can we make you go to school because i really want you to be able to go to school because it's important for you to become a pa here's how we could do it cash and fund it in cash right and so being able to talk about it like that, I think is going to be really important. And yeah, that's how you lay out.
But you're going to be fine, young man. You really will.
If it's a conversation, you're not dictating, you know, it's not like the old school. I'm trying to think of Mad Men where, you know, a guy barks at his secretary and says, do it.
As long as the posture is, I want what's best for our marriage. And this is about peace and us not being like, you know, millions of couples that fight over money.
And then that turns into marriage issues that I think I'm just trying to take the pressure off. Javon, does that make sense to you? Like, you don't have to be a know-it-all.
You don't have to be this wise, you know, sage. No, you just got to be smart with money, and we're going to walk along with you.
And by the way, as a wedding gift, by the way, I want to give you Total Money Makeover, Dave Ramsey's classic book, close to 10 million copies, I think, sold or whatever it is. That's just kind of the basics.
And if you were to just follow that,

because you guys aren't in any kind of trouble, but if you were to just follow that, that would be great. What else can we give them? Yeah.
Make sure they have a financial peace university. Let's do that.
That'll be good. And along with that, you'll have every dollar.
We're just going to set you guys up. You're getting married.
This is our newlywed gift to you. So you get total money makeover, you get financial peace university.
We'll give you every dollar premium for several months. You can hang out with that for a while.
And yeah, I think if you can start having these conversations, maybe you start by not talking about PA school. Maybe you just start by saying, hey, what do we believe about debt? And you just have those conversations.
How do we want to handle our money? And then this happens. The conversation about school comes up as a result of you guys talking

about the other things.

Yeah, I agree with that.

Really good question, though.

I love your heart, Javin.

I think it's great that a young man is thinking about that.

And you got to make the big decisions early in marriage.

Yeah.

And then you spend the rest of your marriage managing those decisions.

And money is one of them. Man, it really is.
Do you ever, Ken, do you ever listen to Jefferson Fisher? Oh, sure. I had him on the front row seats coming out soon.
Oh, that's right. You did.
Oh, man. All I could think of was him when I was thinking about this conversation, because it's all about finding what you agree on and restating what you agree on so that it doesn't escalate.

That's right.

And I would also liken it, I'm glad you bring that up.

I would also liken it to, this is going to give some people some heartburn, so hang with me.

Okay.

I would liken it to the family member that you're going to see on a regular basis so

you can't be a jerk when that uncomfortable political conversation happens.

Oh, yeah.

In other words, like if it's Uncle Larry who you see once a year you might come at uncle larry if he says something you know what i mean yeah yeah but like if it's your grandmother or somebody where it's like you choose relationship over being right or the thing that you've the zinger where you're like you just feel like i need to zing you just kind of let you know what i think of people. We can do that on tough topics and politics is one, money is another, faith and religion, things like that.
When there is some respect to say I'm going to understand you. That's right.
Because here's what I've learned about politics. You're never going to convince somebody else because of your five points that you're going to make in a debate.
Well, what's the key point of that? But seek to understand them. Just to understand them.
You can't understand if you're talking too much. 100%.
Ask questions. Yeah.
Common ground. Where can we find common ground? And so this is a lot easier when it's your spouse, when it's, okay, I'm just going to seek to understand how she thinks and feels about money.
Yeah. Let's start there.
Seek to understand. That's so good.
Then I know what's going on. Yeah, you're not trying to convince them.
You're not trying to bring them over to your side. What do you think about debt? And then she tells you.
And you go, what formed that? What do you think? See, all of a sudden, this isn't a game. It's not manipulation.
It's a legitimate, respectful question asking that allows you to get on her page. That does not mean that you agree with everything on her page but you got there listening now you hope it's reciprocated and in a healthy relationship it will be reciprocated i think that's the lesson that's a very good kid i think that's the best you can do and hope it works out from there and without all else fails go get a great therapist for your marriage hey you know what i mean, Kim.
Come on. All right, quick break.
We'll be right back. This is The Ramsey Show.
You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage. To protect your biggest assets, I recommend using Ramsey Trusted Pros.
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Welcome back to the Ramsey Show. I'm Ken Coleman, joined by Jade Warshaw.
Thrilled to have you with us. 888-825-5225 is the phone number.
Let's go to Lafayette, Indiana. And Steve is there.
Steve, how can we help? Yeah, hi. I appreciate you taking my call.
So my wife and I are discussing whether we should be paying off the house. It's pretty much our last debt that we have.
And current mortgage, I owe about $175,000, and the rate is at 2.79%. We have $420,000 roughly in a 401k and about another $400,000 in money market CDs.
And so I would like to keep it in the 401k, I'm sorry, in the money market in the CDs and get about 4.5% off of that and just apply the overage towards the mortgage payment. And my wife is looking to take it out of there and just pay it off, be done with it.
Let's not worry about the house. So try to figure out financially what the best direction is to go.
Okay. So let me just run that back real quick.
So you're saying she's like, hey, we've got $400,000 in a money market. Let's just pull out the $175,000 and pay off the house.
That's what she wants to do, correct? Yep. And you're saying you just want to use the interest as it accrues to pay off the house? Yeah.
Yeah. So keep the $175,000, you know, the full $400,000 in there because I'll be earning at a little bit higher rate than the $2.79 it's costing us for the mortgage.
I mean, I'm with your wife. You're not going to pay it off that fast.
Have you run those numbers? I'm with Jade. Have you run the numbers on the interest and what that's going to actually be? So for instance, let's put you on the spot.
Over the next 12 months, what are you anticipating that the interest of the 400,000 is going to throw off? Yeah, I guess I didn't really do the math close enough to be able to throw a number on the spot. Well, let's do it.
Let's do it. So what's the return? What do you think you're going to get over the next 12 months on that money market? So $400,000, $4.5,000, so would that be $12,000? Am I doing that right? I think that's right.
Let me get my calculator. You're breaking up up a little bit my well while ken does that i'm not gonna put it yeah go ahead my thought is just um it's kind of like ripping off the band aid in a way um you take the money out the the 175 you pay off this mortgage it frees up your payment right now which how much is your payment right now uh about 1700 but that's, but that's with...
Right, insurance and taxes.

Taxes and insurance. Yeah.
Okay. So I think principal and interest is maybe $900, I want to say, of that.
Okay. So immediately you're free up $900.
If you wanted to, you could invest that or, I mean, if you wanted to put it in a money market. I don't know why you have so much money in this money market, but I would invest that money.
And then you're completely debt free. And I love Dave Ramsey's take on this because he would say, hey, if you hate the feeling of being debt free and you're kicking yourself because you could have made some interest on the four and a half% on your money market, you could always go back into

debt and go back and do that plan. But I don't think you would.
Yeah, probably not. Yeah.
So I got to jump in, Steve, really quick, because I'm 100% with your wife on this. Here's why.
I just pulled the numbers. You're at 4.5% on the $400,000.
That's $18,000 a year. However, if you pay the house off, you, you, you, you, you have massive, massive jump forward in, in your, in your long-term, you know, play.
And then the second thing is, is I would take all that money and I would be, I would be investing most of that. I, outside of your emergency fund, the six month emergency fund, Jade, I would be investing the rest of that after you pay the house off, because I would rather get eight to 10% versus your four and a half.
Absolutely. And that's part of, so you had asked or said like, why is there so much in the money market? So we had a pretty good chunk of money that we came into about two and a half years ago, I want to say it was at this point, and put it in the market.
And then the market continued to decline. I did probably the worst thing ever, which is, you know, put it in and take it back out.
And so we had some, we had some other like personal things going on in our life that said, okay, we need to, we need to minimize the risk of any further loss on this. So we pulled it out and threw it in like a CD ladder for about the last year and a half is when I pulled it out.
So basically I put it in right when it started going down and then, and then I took it out right as it started coming back up. So did you learn from that though? That? Well, I did.
I did. Okay.
So yeah, he's too excited about four and a half percent. I wouldn't be excited about four and a half percent.
That's not, yeah, I agree. Um, I'm trying to formulate a clear clear thought here which is as long as you're moving this money around it's never going to work for you as well as it is if you park it in the stock market i don't care if you park it in an index fund but just putting it somewhere where it's having a better rate of return especially if we're using interest as a basis for this argument you know what i'm saying if you took if you took the 200 000 that will be left after you pay off the house and you moved that and got a 10 or 12 percent rate of return i mean then this whole thing is kind of like a moot point that's where i told exactly what i would do steve pay off the house get with a smart investor pro in your areaSolutions.com.
Make the connection. The smart investor pros are people you need to sit with if you don't have one and sit with them and interview them.
Get the right fit, right field, the connection, the chemistry deal, and then have them invest that money for you. You're going to be so much happier.
Yeah, because what did we say? We said that you were trying to keep the interest. I'm just thinking about the math.
You were trying to keep the interest, throw the interest off of this $400,000. What was that? $18,000 a year? Yeah, he was thinking I'm going to pay the house off at $18,000 a year.
But I'm like, if you pay it off today, the difference is really, I mean, with the payment back, that's $11,000 a year. So really we're saying keep the house around for six more years for $7,000 is really the argument.
And I'd say no to that. No, it's not a good move.
Hey, I want to mention something. Then we got to get to our question of the day.
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All right, let's get to our question of the day, which is brought to you by Why Refi. Do you have a private, excuse me, a defaulted private student loan and the payments are dragging you down? Y-Refi can help you save thousands of dollars.
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It may not be available in all states. All right.
Today's question comes from Shelby in Idaho. She says, my husband and I have been married for 15 years and have two children.
We're on baby steps four, five and six. Last year, he was diagnosed with leukemia and underwent chemotherapy and a bone marrow transplant.
My husband's estranged sister was a perfect match, which probably saved his life. Wow.
Now she has gotten herself in deep debt, trying to flip houses and rent out Airbnbs and has started asking us for money money we've already given her several thousand dollars last month and we have heard from other relatives that she has started asking them for large amounts as well my husband feels obligated to give her money because she saved his life and we now and we know she'll be asking uh for more money again soon how should we respond um well number one guilt should never never be a reason that we give. We should never give out of guilt.
You give out of a cheerful heart. And that's the number one principle right there.
Number two is if you have the abundance to give out of, you still have boundaries around it. It's not an unending well that's like, yes, more and more and more and more, right?

You get to decide, okay,

if we have the money to help a strange sister,

what are our boundaries around that?

And it's okay for you to let her know,

okay, we're willing to give you X amount of dollars,

but this is the last time we're going to be able to do it

because that's where our boundary is.

And after that, you just hold up the boundary.

Yeah.

Let the silence.

I'm going to give you six words.

We can't give more. I'm sorry.
That's it. And just let it ride.
And you say we can't. You have to tell them why.
Just we can't. Oh, I'm so sorry.
We can't. I think that's all you can do