The Road to Financial Freedom Begins With Hard Choices

Speaker 1 Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships.

Speaker 1 I am Rachel Cruz, hosting this hour with my good friend and host of the Dr. John Deloney Show, as well as best-selling author John Deloney.

Speaker 1 And so we are here to answer your questions, life, money, career, relationships, anything and everything. So give us a call at 888-825-5225.

Speaker 1 Up first we have Sierra in Cincinnati. Hey Sierra, welcome to the show.

Speaker 2 Hi. Hello, hello.
How can we help?

Speaker 3 Oh, yes, I was just calling to inquire. I've been, you know, recently addicted to listening to the show, and so I'm wanting to pay down debt and get into a position to invest more.

Speaker 3 So, I had a question in regards to if I should possibly rehome my dog, even though I don't want to,

Speaker 3 to

Speaker 3 get out of dog boarding fees when I'm traveling for work.

Speaker 2 Oh, no. Okay.

Speaker 1 How often?

Speaker 2 Yeah, most people listening like their dogs more than any people in their life.

Speaker 2 Sierra, how often are you traveling?

Speaker 1 I'm sorry. How often are you traveling?

Speaker 3 So with my new job, I travel a little less than I did before.

Speaker 3 So probably it just goes with the storms, potentially like five to six months out of the year. And I'm usually gone from like 10 to 14 days at a time.

Speaker 2 Okay.

Speaker 1 And what's the what's the boarding situation? Are you going to like an actual boarder or do you have someone come and and pet sit?

Speaker 3 So I have a sitter now that's pretty consistent and looking my bank did like an overview of all my spending and for my dogs I spent about $10,000 last year.

Speaker 2 Oh wow.

Speaker 2 Yeah if you're gone half the year I mean

Speaker 3 how long have you had a or should I like maybe talk to my sitter to try to see if we can negotiate something?

Speaker 1 That's what I was wondering or is there some I just wonder if there's other options. I always hate just like a

Speaker 2 this is my only option. I would say get rid of the dog.
Oh, my. I know.
I know Half America just hung up on, like,

Speaker 2 they just are going to send mean cards and letters to the city.

Speaker 2 How much are you making a year?

Speaker 3 So, my base

Speaker 3 is around $79,000

Speaker 3 with my additional pay when I'm traveling.

Speaker 3 I usually, like, last year, I think my gross is about $87,000.

Speaker 2 Okay. But this isn't financial meeting.
This is actually for the dog.

Speaker 3 But I just also got a raise, too. So this year, my gross would probably be around $90,000 to $95,000.

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

Speaker 3 So a lot.

Speaker 2 So I have

Speaker 3 $20,000 for my car.

Speaker 3 And then I have a credit card with $10,000 on it.

Speaker 3 And then student loans is $70,000 plus $5,000 of interest.

Speaker 2 So $75,000.

Speaker 1 Okay, so you're right at $100,000.

Speaker 1 of debt, making $95,000, spending $10,000 on the dog per year.

Speaker 1 Might be going down because you have a new job.

Speaker 2 And how long have you had the dog?

Speaker 3 There are five and six.

Speaker 1 You have two.

Speaker 2 Five and six. Ah, okay, but like for the dog's sake, they only get to see you half the year, right?

Speaker 3 Yes, but they're excited when they see me when I come back.

Speaker 1 Sierra, all dogs are excited.

Speaker 2 I'm having gone for five minutes. No, I, okay, here's what I would do, Sierra.

Speaker 1 I just wonder if there's anyone in your life who wants a dog as well. And you can like co-parent this dog.

Speaker 2 You're out of your mind.

Speaker 1 And for like six months out of the year, this dog goes and lives with your friend who's like great with a dog and loves it. And you guys are.

Speaker 3 Well, so it's not like a consistent, like it, like a storm could happen today or a storm can happen a couple months from now. It's not like consistent.
Like right now, I'm in down season.

Speaker 3 But like storm.

Speaker 2 Yeah, I understand. Yeah, I'm just saying.
I mean, there's no friends like that, Rachel.

Speaker 1 She's joking, like the co-parenting. No, she could, you could totally have a friend that's like, oh, I love dogs.
And they're, and Sierra's like, I'm just, I, I can't.

Speaker 2 And they're like, this guy can live without the planet. I don't know any friend that'd be like, anytime, Terrenite, drop your dog off for six months.
That'd be awesome. I don't know that person.

Speaker 2 Maybe.

Speaker 2 Maybe.

Speaker 2 I think you're right.

Speaker 2 I think you're right. What brought you to this question, even that you're considering it? Do you think it's the right move?

Speaker 3 No, I don't.

Speaker 3 I don't. No.
I just like I like if I track my expenses and just cut everything out, I'm looking at like including like $200 a month towards the dogs when I'm not traveling

Speaker 3 just to like build up an expense.

Speaker 3 Like right now, I'm at like $2,800 in expenses a month.

Speaker 2 Okay.

Speaker 3 Because my last job used to give me per diem, so the per diem helped out with the dog cost.

Speaker 1 Sure. Yeah, yeah, totally.
I mean, because here's my thing. I'm like, Sarah, you'll be out of debt in what, probably two and a half years.
Like, if you really.

Speaker 3 When I ran it, it was like three, like almost four years with the student loans.

Speaker 2 Yeah, I think you can do it faster.

Speaker 1 I would pick up an extra job. I mean, I would do things because.

Speaker 2 Especially during the slow season. Can you work right now?

Speaker 3 I've been trying to think of options. I'm not in an area where there's like Uber or DoorDash or anything in that nature.
Okay.

Speaker 1 Yeah, I would get creative on the income side and be able to pay off your debt faster because here's the thing. The debt is so temporary.

Speaker 1 You could be out of debt in, let's just say, two and a half years. And then, you know, your dogs are going to be.

Speaker 2 Dogs are forever.

Speaker 2 It'll be eight.

Speaker 1 You'll have like another two years.

Speaker 2 Yeah, maybe that's the question. Do you want to go get during your off time? If you're home for a month or two without a big storm,

Speaker 2 do you want to work on those days

Speaker 2 that you're home?

Speaker 2 Work, put in eight, 10 hours a day, just bust it, go throw boxes at Walmart, go pick up a shift at McDonald's or whatever, work really hard on those days, and over the course of a year, you'll probably earn about an extra 10 grand.

Speaker 2 If those dogs are worth that investment, then you've answered your question.

Speaker 1 That's a good way of, yeah, that's a good way of framing it. That if you had to work extra and make $800 a month

Speaker 2 to cover the cost of those dogs, is that investment, is that worth it for you?

Speaker 3 Yeah, I possibly could. It's just like they'd be in the house more if I work more.

Speaker 2 Okay.

Speaker 2 But I mean, you have to just make that call for yourself.

Speaker 1 Yeah.

Speaker 3 Okay.

Speaker 1 Yeah. And there, I mean, there's a, there's a lifestyle question for sure of the happiness of the dogs, right? I'm like, yeah, if you are going to have to work.

Speaker 2 I've got to spoil their own too.

Speaker 3 So.

Speaker 2 Yeah, but we spoil our dogs, not for them, but we spoil them for us, right? I spoil mine too.

Speaker 2 But the dogs don't care, right? My son found a couple of like old cow bones in this old field and he brought them home.

Speaker 2 The dogs are the happiest they've ever been with like these, you know, old cowboys. Like, they don't care.
We spoil them for us, right?

Speaker 3 yes

Speaker 2 all right if you need a if you need an anchor when you come home you've been gone for a month you need an anchor to get home to like so you don't come home to empty apartment i totally get that i totally get that

Speaker 2 okay but i think you just the math the sucky part here is math doesn't care about any of this the math is you you owe a hundred thousand dollars and you make ninety

Speaker 1 and how quickly can we get that debt paid off yes i think that's it i think it's just it's the sacrificial question and is it is that sacrifice worth it getting rid of them to gain an extra 20 grand over two years and how quickly does that help you become debt-free faster and if that's not worth that sacrifice you're like no i will be in debt six months longer in order to keep the dogs or whatever you know it ends up being for you then that's great too so no i i i can't sit here in good faith and say yes you need to sell these dogs but i can i can't say if it was if it was me i probably

Speaker 2 i probably would i wouldn't sell them they're not for sale and i like my dogs most more than almost every person I know.

Speaker 2 And so, like, I'm a dog guy, but.

Speaker 1 Yeah, that's a hard one, Sierra.

Speaker 2 20,000.

Speaker 1 I don't know. I would find option C.
See if there's a good friend who will take it.

Speaker 2 That friend does not exist.

Speaker 1 I believe that friend is out there, Sierra. It is the Ramsey Show.

Speaker 1 Welcome back to the Ramsey Show. If you are a listener of the show and you've been listening for a while, we actually have a survey that is out and it is live.

Speaker 2 Oh, great. The segment after I told this poor woman to sell her dogs,

Speaker 2 we're going to do a Ramsey survey.

Speaker 1 I want everybody to be like, what do we not want to hear John telling people to sell their dogs?

Speaker 2 By the way, George Campbell, the guy who

Speaker 2 loves his two dogs more than any human, it's absurd.

Speaker 2 He didn't hear the whole call, though. I know, but he was with me.

Speaker 1 He walked by and said,

Speaker 1 sell the dogs. But he didn't have all the context.

Speaker 2 I think George would give both of his feet

Speaker 2 and one of his hands for both of his hands for his feet. For olive and blue.
Oh, yeah. What are their names? Olive.
The fact that you,

Speaker 2 his friend, know the names of his.

Speaker 1 We talk about these dogs all the time on Smart Money Happy Hour. They get brought up more than Mia, his daughter.
That's how much. You know, they have to wipe their butts.

Speaker 2 They wipe their... Do you know that? Oh, I do.
That's what I told George. I put George on friendship probation.
You have to do that. I was like, you don't have a dog at that.
You know why?

Speaker 2 Because God didn't make that dog. And then the dogs have to sleep.

Speaker 1 And then the dogs have to sleep in the bed. Oh, it's a whole thing.

Speaker 2 Anyways,

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All right.

Speaker 1 Going to the phones. We have Lisa in Houston, Texas.
Hitch Tone. What's up, Lisa? Hey, Lisa.

Speaker 2 Hi. How are y'all?

Speaker 1 We're doing great. How can we help?

Speaker 3 Good.

Speaker 3 Question. My husband and I are both in our late 50s.
We have nothing saved for retirement. What can I do?

Speaker 3 Well, I should say that for myself, I'm clinically and legally blind.

Speaker 3 And he works offshore, so he's not home a lot.

Speaker 3 So I'm just trying to figure out what can we do.

Speaker 2 Who helps with your caretaking while he's gone?

Speaker 3 Nobody. I'm here alone.

Speaker 2 Oh, good grief.

Speaker 3 Oh, yeah, I can maneuver pretty well, thank God.

Speaker 2 My goodness. So, y'all have no pension, no

Speaker 2 security, or disability at all, these things?

Speaker 3 No, no. In my life, we've been married for almost 37 years.
I've only worked maybe four years if you connect all the daggers together. So, I don't have anything like that.

Speaker 2 Does he, though?

Speaker 3 Yes, I'm sure he does. He's been working forever, but yes.

Speaker 2 Okay, y'all need to combine your money because y'all are going to be retired together.

Speaker 3 Okay. Well, but listen, I don't have any money.

Speaker 3 I don't have, like I said, I haven't worked in years.

Speaker 2 I know, but I don't think you're hearing what I'm saying.

Speaker 3 Oh, no, I'm talking about that. Go ahead.
No, it's okay.

Speaker 2 Like,

Speaker 2 you haven't worked, but you've kept that household up while he's gone, right?

Speaker 3 Oh, right. Yes.

Speaker 2 Yes. And so his money has the money that he's earned

Speaker 2 and the money and it's y'all's money is what I'm trying to say.

Speaker 3 Right, right. It is.
It is. So we don't we share a bank account and everything yet.
Perfect.

Speaker 2 So does he have a retirement with his company or does he have mutual funds or a 401 or Social Security?

Speaker 3 Social Security, I believe he would have that.

Speaker 3 As far as 401k, the company's with his company bought it out two years ago. So I think they just started the 401k, but he hasn't gotten into it yet.
He's been at this company for two years.

Speaker 2 Okay.

Speaker 1 Lisa, how much does he make a year?

Speaker 3 About $101,000.

Speaker 1 Okay, $100,000. And what kind of debt do you guys have?

Speaker 3 Well, I have an SBA loan on my home,

Speaker 3 car debt. Do you even know the amounts or what?

Speaker 1 Yes, I would love to. Okay.

Speaker 3 Okay, the house, $85,000. Okay.
The car, $45,000.

Speaker 3 Credit card debt, we have maybe three cars altogether. It's about $25,000.

Speaker 3 Student loan, $16,000.

Speaker 2 And what you said there's an SBA. That can't be the right one.
What loan do you have on your house? Yes.

Speaker 3 It's the SBA.

Speaker 3 What happened is we paid off the house back in 2014, but when Harvey hit and my husband's company folded back, then went bankruptcy, we had to live off of whatever money we had in his 401k, and he didn't get another job offshore until a year later.

Speaker 2 So how did y'all get an SBA loan? Has he taken it out with his company and y'all just took that money and used it for your expenses?

Speaker 3 It was because of Harvey, the flood.

Speaker 2 Uh-huh.

Speaker 3 Yeah, we were flooded out our whole city.

Speaker 2 Yeah, I was in Houston. I remember that.
Yeah, yeah, yeah. Okay.

Speaker 3 Yeah, we didn't have house insurance at that time because he had lost a job a year before.

Speaker 2 And so, therefore, we.

Speaker 1 You took out the $85,000 to fix the home and to live off of? Okay.

Speaker 3 Yes, yes.

Speaker 2 Okay.

Speaker 1 And nothing's saved. Yeah, do you have any cash?

Speaker 3 Well, I do have $9,000 cash, but that's, I'm saving to get a roof. I'm going to need a roof before August.

Speaker 1 A roof on the home?

Speaker 2 Yes. Okay.

Speaker 1 So, yeah, I mean,

Speaker 1 this is a tough one, Lisa, just because of the reality of these numbers and where to get you guys in order to start looking into retirement. I mean, he probably will not be retiring anytime soon.

Speaker 1 Is his health okay?

Speaker 3 It's okay.

Speaker 2 Okay.

Speaker 1 Yeah, so I think that you guys just need a game plan.

Speaker 1 I think you've, and to a degree, have kind of just been floating and, you know, using debts to fix issues, also, you know, kind of patch up things in life. And there's not really been a plan.

Speaker 1 So what I would do is I would sit down with you guys together tonight and you both really need to be on the same page, like in a really deep way. John was mentioning that earlier.

Speaker 1 But like what you're going to have to do here in the next seven, eight, nine, 10 years is, I mean, it's a decade of saying, hey, we're going to we're going to have to do something completely different the way we've been doing money.

Speaker 1 And you both have to be bought into that. And so what it's going to look like, Lisa, is to be paying off the smallest debt first.
So you're going to work on those student loans, those $16,000.

Speaker 1 You're going to next cut up the credit cards, start paying those off smallest to largest. And if there's three of those, so the goal here is to write down all of your debts separately.

Speaker 1 So if you have two student loans, write them as two different loans.

Speaker 1 Three credit cards, write them as three different, because the goal here is to write out every piece of debt you have, and you're going to pay off the smallest one first.

Speaker 1 And you're going to work your way through. But I mean, this is without, with, without any extra income and just him,

Speaker 1 yeah, it's going to, it's going to take you guys probably three to four years to get out of this.

Speaker 1 And so my, my challenge to you, Lisa, is, you know, we've talked to a lot of people on the show with a lot of different situations and a lot of obstacles in life.

Speaker 1 And we've talked to people that have been legally blind and that they, that they haven't gotten disability or they haven't been able to apply for government assistance or anything like that.

Speaker 1 But they, you know, they've done things creatively to think through, hey, how in any way can I bring in an extra? So like even you, Lisa, being able to bring in $400, $500 extra a month.

Speaker 1 I mean, just something because the more that you guys

Speaker 1 sacrifice lifestyle, don't live on anything.

Speaker 1 And you throw as much as you can at debt, that's really the only way to get out of this. I wish there was a magic wand just to wave and change the whole whole situation.

Speaker 1 But your steps are going to be, Lisa, to get out of debt first

Speaker 1 and then beyond that, save some cash and then start looking into retirement. That's why I'm saying it's going to probably be a good decade.

Speaker 1 And then I would start lowering my expenses because when you guys get to the point of retirement, I want you to be able to, yes, use Social Security, but also be able to cash flow your lifestyle at that point from the decisions you're making today.

Speaker 2 Okay. And if you were my mom,

Speaker 2 I don't want to over-sensationalize this, but I have a couple of buddies that worked offshore out in the Gulf.

Speaker 2 And your husband's time out there is short, and you know that, right?

Speaker 2 I can't keep doing that late into his 50s. That's hard work.

Speaker 2 That's a young man's game. So y'all are making a six-figure income.

Speaker 2 I would get maniacal. about paying this stuff off.

Speaker 2 There's no reason to have a $45,000 depreciating asset car in a driveway when you can't drive because of your vision and he's gone a month or two or three at a time.

Speaker 2 Right? That's a used Camry house. You don't need a big old fancy nice car out in the driveway.
You need to sell that ASAP and knock that debt off. But y'all are just going to have to get radical.

Speaker 2 And I hope he'll be there with you. I think the words I would start with are, I'm very, very scared about our situation.
Would you be willing to make a radical shift with me?

Speaker 2 Because, I mean, Harvey was in 14. It flooded.
It was a zoo. That's 10 years.
That's 11 years ago. And y'all still haven't messed with those debts.
Let's get on it.

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Speaker 1 Or if you are listening on podcasts or YouTube, click the link in the description. This was one of our biggest events last year,

Speaker 1 virtual events. People loved it.

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Speaker 1 He talks about it. Yeah.
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Speaker 1 All right, going to the phones, we have Ben in Kansas City. Hey, Ben, welcome to the show.

Speaker 3 Good afternoon. A longtime listener.

Speaker 2 Really believe in your systems.

Speaker 3 I'm in a situation.

Speaker 3 Blast of my three kids is graduating from college in May, and she is entering dental school.

Speaker 3 And over the years, I've heard you and Dave and all talk about the fact that be careful about taking student loans.

Speaker 3 And her dental school is going to be approximately $400,000 over the four years.

Speaker 3 And I'm trying to find out what solution or what ideas you might have to finance that so we don't have to take out the traditional school loans.

Speaker 2 You're not going to like our answer.

Speaker 2 Okay.

Speaker 2 I spent my whole career in higher ed. That's been my whole world until just a few years ago when, as my son says, I became a YouTuber.

Speaker 2 And I also

Speaker 2 studied the mental health of attorneys, physicians, health professionals. And at the very top of that list is dentist.
And I believe personally,

Speaker 2 I didn't do a financial study.

Speaker 2 I believe it's because they get out of school with three or four hundred thousand dollars in debt, and then they immediately go in and are told they have to buy a practice or buy into a practice or just to start open up their own shingle.

Speaker 2 They got to take out another million-dollar business loan to get this thing going. And then they find themselves on a 50-year treadmill that they will never be able to get off of.

Speaker 2 And so, the thing I would implore you to do is please don't take out half a a million dollars in debt. And I know it's your daughter's dream.
I love dentists. I love good dentists.

Speaker 2 I've bought many a dentist a nice car with the work they've had done.

Speaker 2 But it's such a crushing burden.

Speaker 2 And I've just had the blessing, yet the heartbreak of sitting behind closed doors with dentists, man, when their worlds are falling apart because they owe so much money.

Speaker 2 Yeah. So there's not, there's not an easy thing I can tell you.
I wish I was, man, but I'm sorry. It's become so insanely cost-prohibitive.
And I do know I'm not one of these end-of-timers.

Speaker 2 Like, if med school is expensive because,

Speaker 2 you know, you have to hire, you have to hire a surgeon who knows how to take a heart out of somebody and put another one in there.

Speaker 2 You got to hire that person out of the marketplace to go teach at a college, right? That's expensive. So, med school is going to be expensive.
Dental school is going to be expensive.

Speaker 2 I want dental school to be done right and done great, all that. So, I'm all about it.

Speaker 2 But I can't, having seen the psychological toll of owing half a million dollars on day one of your brand new job I can't good conscience say you just just go find a student loan and go knock that out

Speaker 3 so are there alternatives that we could look at as far as financing it can I help finance it

Speaker 1 what other options are out there other than student loans well with These types of schools, law, I mean, I put law school in this, you know, if you're getting your MD, dental school, you know, there, there are situations where we've talked to people that have done it debt-free, but they're very creative.

Speaker 1 They're very unique.

Speaker 1 It's a very kind of a small sliver of whether it's, you know, these types of working for the school, internships, like there's like different types of ways that you can do it, different programs, specifically when you're looking at law, specifically when you're looking at medical, and even dental.

Speaker 1 And again,

Speaker 1 I don't even know where to direct you in that, but we have had people call and we've had someone, we had someone just a few months ago on Debre Stage, and they were, they went, and I think it was their law degree they got and they got it completely paid for.

Speaker 1 So, again, there's like these creative alternatives, Ben,

Speaker 1 that you can look into that are out there. Again, they're very, they're they're slim.
It's there. What's um, what's your finances been? Where, where are you and your wife?

Speaker 3 Well, I'm 64. Uh, my wife is 60, uh, so approaching retirement, uh, still working full-time

Speaker 3 we're we're completely debt-free

Speaker 3 so you know we're we we and we had a 529 account for each of our kids and that helped them through their undergraduate and they all got scholarships as well so that helped a lot and we haven't even applied for scholarships yet for dental school we're going to be starting that process but is there anything left in any of the 529s from the other kids that have already completed school and are not going to go back

Speaker 3 there is the uh the total amount at this point in time is about $66,000.

Speaker 1 With all the 529s in your kid's names, not just hers?

Speaker 2 Yes. Okay.
Yes. Okay.
So I guess the creative adventure, dude, would be,

Speaker 2 and like I say, this is me spitballing. There's not an easy solution here until graduate programs decide we're going to intentionally, and I think it's going to have to be a university and a

Speaker 2 public partnership. And you know how I feel about partnering with a government on anything, but we all need doctors.
We need good attorneys.

Speaker 2 We need good dentists, but we also need doctors and attorneys and a dentist and dentist that can breathe at night so they can sleep.

Speaker 2 So they can show up for the least of these and they can't with this kind of money. So if you, if you immediately walk in, and so now you've got, you're down to 344 because you got 66,000.

Speaker 2 And if your daughter can

Speaker 2 punt her entrance for one year and get a job and make $50,000 and live with you guys, and you can, now you're down to $300,000, right?

Speaker 2 So i would tell you to try to figure out a way to cash flow it and then if you get some um get some uh scholarships down to a certain i mean that's what i'll tell you to figure it out and if you have to postpone a year or two they'll they'll punt your admission for a year they'll defer it for a year and um you can figure it out that way but again it's a long shot it's just hard yeah and i would say for her ben to go down that road what john is saying because i've know i know two people that are dentists and they had to buy a practice and or pay into one i mean like it was there was so much debt on top of

Speaker 1 their school. Yes, like there's,

Speaker 1 and, you know, kind of unlike a doctor that just kind of plugs into a hospital, right?

Speaker 2 Unlike an attorney who can, could literally practice law from their house. You have to go buy dentist chairs and tools.

Speaker 1 Yeah, yeah. It's a, it's a different, it's, yeah, it's a, it's a different road.
And so I would implore her to go on this discovery and go and inter, seriously, go and ask and talk to.

Speaker 1 two or three yeah dentists and just ask because we did a um documentary ben and we'll we'll put the link in the show notes here on the show called Borrowed Future.

Speaker 1 And one of the guys that we interviewed, he was a dentist, a million dollars in debt. A million dollars in debt.

Speaker 2 Hey, Ben, let me ask you this.

Speaker 2 How many schools has she applied to?

Speaker 3 Three different schools.

Speaker 2 And so she got into just one or all of them are about $400,000?

Speaker 3 She just got into one.

Speaker 2 Okay.

Speaker 2 Is it a private school? Is it a for-profit school? Is it a reputable school?

Speaker 3 It's a reputable school, but it is a private school.

Speaker 2 Okay.

Speaker 1 Which is going to turn the message in.

Speaker 2 Maybe it is going back to the public schools that she didn't get admitted to and either asking the admissions counselor.

Speaker 2 I know with the law school admissions folks I worked with, they were remarkable about telling candidates, here's how your candidacy could have improved when they would when they would trickle back and ask.

Speaker 2 And maybe it's applying to more and more public schools across the country and just giving it a shot, especially if you defer enrollment for a year.

Speaker 2 But private is going to be your most expensive option. My hope would be you could find a great state dental school

Speaker 2 for a couple hundred grand. And that's that is what it's going to cost.
And I don't have any, I don't blink an eye about that.

Speaker 2 But then that would give your family a chance to rally around her and to do this without borrowing money.

Speaker 1 The Ramsey Show question of the day is brought to you by Y ReFi. Student loan debts is a swamp of thousands of people that find it hard to escape from.

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Speaker 2 Today's question comes from Jessica in Nevada. Jessica writes, My partner and I have been together for four years.
Both of us went through horrific divorces.

Speaker 2 We live together and have part-time custody of our young children from those marriages.

Speaker 2 We are about to have a baby together but do not want to get married even though we are in a committed, loving relationship.

Speaker 2 How can we provide security and protection for each other and our baby in case something happens to one or both of us? My partner has a very well-paying job. I'm a teacher.

Speaker 2 Once we have a baby, I'll probably work part-time or stay at home for a while.

Speaker 2 So, how can we provide security and protection for each other and our baby in case something happens to one or both of us?

Speaker 2 You're not like my answer, but get married and give your kid a legal foundation for which, good gosh, what a mess.

Speaker 2 I mean, that's what you need to do. I mean,

Speaker 2 are you going to sit down with a wills and estates attorney? I don't know the state of Nevada. They may have some specific...

Speaker 2 some different legal things, but the greatest gift you could give your kid is to process and heal from the horrific divorces.

Speaker 2 And both of y'all go to the therapy that you need and get the care that y'all need. And then

Speaker 2 don't throw the baby out with the bathwater. And so y'all had a, like, you went through a really tough car wreck.

Speaker 2 That doesn't mean we never drive again, but that means we do need to get over the anxiety of getting in a car again. We got to practice driving.

Speaker 2 We got to get a new car, but we're going to have to get back out on the road sometime. And so the safest thing you can do is give your, is get married.

Speaker 2 And then if one of you dies, then there's legal protections across the the board there. But I'd go talk to an estate attorney if y'all aren't going to do that.

Speaker 2 I don't really have an answer for you other than that.

Speaker 1 Yeah, because I do feel like some people,

Speaker 1 it's like this avoidance of like, I don't want marriage because it hurt last time. So we're going to just not deal with it and do it our own way.
Exactly.

Speaker 1 And because of that, what you miss so many opportunities to probably heal from those traumatic divorces of what you're saying. And it actually causes you to face this fear of,

Speaker 1 yeah, of like, I don't want to do this again. I'm so scared.
But yet we we basically are married from like an emotion, right? We're living together. Like there's a level.

Speaker 2 Cling house. Yeah.
Yeah. Yeah.
But we think we've avoided a potential hurt because we don't have this.

Speaker 1 Legal standing. Right.
Yeah.

Speaker 2 And what it's like, it's like actually a better analogy is we were driving in a car and we got in a wreck and we got hurt by our seatbelt.

Speaker 2 And so we're going to drive again, but we're never wearing a seatbelt again. And what that means is if you get in another wreck, it's going to be way bigger mess.

Speaker 2 And the likelihood you're going to get hurt is way worse than what it was. And so you chose to get back into a romantic relationship.
You chose to both share a house together. Have a baby together.

Speaker 2 You both chose to make a human together. So the only thing you're not doing is protecting yourself with the

Speaker 2 legal protection of a licensed marriage. Yeah.
And dude,

Speaker 2 I've been getting this question more and more and more. Like, I don't want to get the government involved.

Speaker 2 If you have a kid, the government's involved because you made it one of their citizens. You've done that already, right? If you buy a property with somebody, you've got the government involved.

Speaker 2 So it's cool to be like, I don't want to move on. They're involved.

Speaker 1 So move on. Is there a psych, what's the psychological

Speaker 1 play here when you're not married and doing all of this, right? Living together, having a baby together.

Speaker 1 And then from not just from a legal standpoint, but what does that do emotionally, psychologically to say like, oh, well, we've entered a marriage? Does something shift in that?

Speaker 2 It can.

Speaker 2 And if it's, you've got, you know, if they did go through horrific divorces, which I believe, then, then, yeah, if you have trauma surrounding an old behavior and you re-engage in that new behavior, you're going to have to deal with it, right?

Speaker 2 Yeah, yeah, yeah.

Speaker 1 But is there a level of commitment? Like, is there something about the seriousness?

Speaker 2 There's something about

Speaker 2 it does, yes.

Speaker 2 You have to be all in. I wish there was another way to say it.
But if you're not all in, then when things get rocky, which they will, you. So much easier to leave.
Yeah. You hop out.

Speaker 2 So much easier to leave. And so what you're what you're almost guaranteeing is any bumps in the road in the future, it's just going to be messier, except quite honestly, Jessica.

Speaker 1 And she's in a worse spot.

Speaker 2 I'm going to overgender this, but you're in the bad spot here because if his name is on this house and you don't have a job and you become just baby mama or live-in girlfriend and y'all break up, you're in a mess, right?

Speaker 2 Having to re-enter the workforce. So in a weird way, a marriage may protect you more right now.
And so again, meet with an estate attorney in Nevada and work that stuff out individually.

Speaker 2 But yeah, man,

Speaker 2 I hate this for you because y'all are in a mess. You're trying to

Speaker 2 go swimming without getting wet. And you're already in the pool, man.
You're already in the pool.

Speaker 1 All right, let's go to Richard in Anaheim, California. Hi, Richard.
Welcome to the show.

Speaker 3 Hey, guys. Thank you for taking the call.

Speaker 2 I really appreciate it.

Speaker 1 Absolutely. I know you're kind of south of everything going on there, but you guys good?

Speaker 2 North, yeah.

Speaker 3 We're very safe.

Speaker 2 Is it that Anaheim south of?

Speaker 1 It's south of Santa Monica, right?

Speaker 3 Yeah, we're Orange County.

Speaker 2 Yeah, yeah, yeah. Okay, sorry.
I used to be a geography teacher. I shouldn't know that.

Speaker 2 Doesn't know his California geography.

Speaker 2 Yeah, how can we help?

Speaker 3 So here's what I'm asking.

Speaker 3 I'm going to be, I'm 50 years old, basically,

Speaker 3 with three children,

Speaker 3 you know, all toddlers under the age of 10.

Speaker 3 And,

Speaker 3 you know, I'm tired of just the day-to-day rat race. My job, you know, pays for our bills, but I don't ever have anything saved.
My wife is a stay-at-home mother,

Speaker 3 taking care of the kids, and we homeschool. Okay.
It's very, very important to us. We're very religious when it comes to that.
So that's a non-negotiable for getting a job.

Speaker 3 But, you know,

Speaker 3 I own my home. I have 300 grand in equity.
You know,

Speaker 3 I have been on the job a long time, and I'm just, just, you know, I'm just staying above water. Cost of living is just so expensive here in California.
You know, my monthly

Speaker 3 nut that I have to pay, part of my French, is

Speaker 3 $8,300 a month. You know, my mortgage is $4,900.
I have

Speaker 3 one debt, which is my car payment. You know, I owe like $17,000.
My wife's car is paid off.

Speaker 3 You know, so I'm just

Speaker 2 at the point where you're going to be able to get away.

Speaker 1 You're just running, running, and there's no traction. You should move.

Speaker 3 I want to move to another state.

Speaker 2 And move to another state.

Speaker 2 I did it.

Speaker 3 And pay cash.

Speaker 2 I did it. And it was, some things were really great.
Some things are really tough. And

Speaker 2 the good thing is that

Speaker 2 we got a chance to start over and make a new life. And the bad thing is I went with me.

Speaker 2 So any of my old stuff that I didn't like about myself or my parenting or how I was as a husband, I came with me. So I had to deal with it here.
But you should move. What's your wife say, Richard?

Speaker 3 My wife's open to to it. It's just all her family is all within

Speaker 3 a 20-mile radius within here in Southern California. So it's a little bit of a challenge.

Speaker 2 That's what I do. They're older.
It's not good. Yeah.
It's hard.

Speaker 3 Yeah, and that's it is hard. And, you know, it just, I could go and pay cash for a house in another state and not have any debt.
My income is going to stay the same in the next 10 years.

Speaker 3 It's not going to fluctuate that much going up. And I make $137,000 a year.

Speaker 2 What do you do for a living?

Speaker 3 I do national accounting.

Speaker 2 Okay. Okay.
Yeah.

Speaker 3 Travel. I travel a lot.
And I've thought I was getting a second job on the weekends, but then I'll never see the kids because I travel.

Speaker 2 Hey, Richard, Richard.

Speaker 2 Richard, I can hear it.

Speaker 2 You travel, and every minute you're traveling, you're thinking I should be moving. And when you're at night and the kids are in bed, you're looking up other real estate in other states.

Speaker 2 Here's what you're doing. You're slowly making yourself crazy.

Speaker 2 Just move.

Speaker 2 And here's the beautiful part. If you hate it, y'all can move back.

Speaker 2 But right now,

Speaker 2 I think you need to go. Ask your wife,

Speaker 2 can we do 24 months? Can we commit to a new town and a new area? There's going to be a lot of grieving. Family's not going to like you.
They're going to get mad at you. I went through that.

Speaker 2 Doing holidays is going to be weird. And so you may need to budget a little bit more for travel over the holidays.
We'd have to do that too.

Speaker 2 And then get out of there, man. Go do something else.
And this has nothing to do with California. It just has to do with you're done in this area and you want a little bit more.

Speaker 1 And you're trying to justify it any other way of like, oh, stop being angry about it.

Speaker 2 Stop being angry about it. Just make your next move, man.

Speaker 2 It's not worth your soul and just being angry. And

Speaker 1 there's no, and that's the thing: there's not a light at the end of the tunnel. It's this, it's going to be the same life over and over again.

Speaker 2 To do something different. Yep.

Speaker 1 Right. To change it.
And you can always go back.

Speaker 2 You can always go back. Yep.

Speaker 1 Well, thanks so much to the guys in the booth. Thank you, John.
Always been a great host. And thank you, America.
We'll be back.

Speaker 1 Live from Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships.

Speaker 1 I am Rachel Cruz, hosting this hour with my good friend and best-selling author, Dr. John DeLoy.
What up? So we are answering your calls on life, money, relationships, career, anything and everything.

Speaker 1 Give us a call at 888-825-5225.

Speaker 1 And if you're listening live, yeah, we are here for the next two hours. So

Speaker 1 we'll be here by the phone.

Speaker 2 The last hour, I'm not going to lie,

Speaker 2 it was a heavy one. It was a sad hour.

Speaker 2 I saw my dogs. James Child cut his beard.
It was a whole thing. It was a heavy, heavy hour.
So we're going to lighten it up a little bit on this one.

Speaker 1 This is going to be great. And our board is full of calls from all around the country.
So let's dive in. Let's have Michael start us off this hour.
And

Speaker 2 Michael. What's up, Michael?

Speaker 1 In Chicago. Hey, Michael.

Speaker 3 Hi, guys.

Speaker 3 thank you for having me and thank you for taking my question yeah what's up man so my parents asked me for 40 to 50k for a down payment for a second home oh god no don't do that okay well can you can my

Speaker 2 question

Speaker 3 okay go ahead so they they currently live about 10 hours away from the rest of us siblings and they don't have the down payment uh for that home The reason for them not being able to move and be closer to us is my father is waiting to finish five more years at his job to collect a pension and they're wanting to have the flexibility to be closer but to have their own place.

Speaker 3 I'm 25 years old, just got out of my own debt, and I'm really unsure what to do.

Speaker 2 Yeah, I would say no.

Speaker 1 Why are they coming to you, Michael, and not another sibling?

Speaker 3 I'm the most financially secure right now. My other three siblings are living

Speaker 3 paycheck or just getting out of their own student loans.

Speaker 2 Okay. So what they're asking you is a couple of things.
They've created a set of principles for their life. We're going to stay here for five more years.

Speaker 2 We don't want to be uncomfortable when we travel. We want to have our own place.

Speaker 2 Problem is they're grown adults, but they can't afford these principles they've put into motion. So they come to their 25-year-old child and said, you make our dreams that we can't afford.

Speaker 2 You make our principles concrete because we can't. Right.
And you, that just, it's not your job. And by the way, this will mess up your relationship.

Speaker 2 I would tell you, there's a financial reason to not do this, but the main thing is, dude, it will mess up your relationship with your dad.

Speaker 3 Worried about.

Speaker 2 Yeah. So I don't, do you have $25,000 in cash? You can just hand them?

Speaker 3 Yeah. Yeah.

Speaker 3 I'm debt-free now

Speaker 3 quite a bit in a savings account right now that he's aware of, obviously. He helps me

Speaker 3 look at my financials. He's the only one I talk to my financials about.

Speaker 2 You need to stop doing that, by the way.

Speaker 2 He's violated that trust. And so you need to get a smart vestor pro and

Speaker 2 have that person do that. I love my dad more than life itself.
And him and I don't go through the intimate details of our finance, my, of our finances together.

Speaker 2 I have a person and he's got a person. And that helps preserve our relationship.

Speaker 3 Right.

Speaker 2 I hate this for you, man.

Speaker 1 How do you, do you, can you predict at all, Michael, just from the pattern of who they are? Is it more your dad wanting this, you think, or your mom?

Speaker 3 So it's obviously a complex situation.

Speaker 3 All of us kids were all over the country when they decided to move down south away from us.

Speaker 3 And now two of my siblings are getting married in the next few months and, you know, wanting to have children, obviously, pretty quickly.

Speaker 3 So I think a lot of it has to do with them wanting to be closer to us during those times,

Speaker 3 obviously being stuck at that place that they're at right now due to their current position.

Speaker 1 Yeah. Well, they wouldn't be able to come up a ton anyways because he's working still, right? I mean, how often would they be able to come up realistically?

Speaker 3 Yeah, that's a good question, too. And I don't know.

Speaker 2 So, I would ask them that.

Speaker 1 And honestly, Michael, for them, I'm like, I mean, just do an Airbnb for two weeks. Like, if they're coming up, I mean, for them, financially, that makes more sense instead of having an asset here.

Speaker 1 You know, we had some friends and they were in-laws. Yeah, we're out of state.
They weren't asking them for money, but they were considering buying a condo.

Speaker 1 And after they ran all the numbers, like, well, we're really probably realistically only going to be here a total of maybe six weeks throughout the year.

Speaker 1 Like, if you put it all together, your kids are here. You can stay with them or get a hotel.
I don't know.

Speaker 1 It just, from a financial standpoint, it doesn't make sense if you can't pay cash for a second home for it just to be there for your own leisure, but you're paying a mortgage on something that's literally just sitting there.

Speaker 1 It's not good. I don't, I wouldn't even suggest that to them.
If they called us and were like, hey, I want to take out a loan on a second home. Here's the situation.

Speaker 1 I would probably tell them, no, I wouldn't do that anyways, let alone borrow the down payment from your son.

Speaker 3 Yeah, I'm planning to talk with them in a few months about it to the both of them. Yeah.
Just let them know. But obviously,

Speaker 3 you know, wanted some advice.

Speaker 2 The language I would use is, thank y'all so much for reaching out. And that means a lot to me that y'all have noticed how I've turned my things around.
That's pretty cool.

Speaker 2 I've got some pretty clear financial goals that I'm trying to hit. And so

Speaker 2 I'm not in a place where I can loan money to family members right here.

Speaker 2 And just

Speaker 2 any response they have is they've got to own it, man.

Speaker 3 Right.

Speaker 3 I think the biggest thing for me is my parents have allowed me to be as, you know, in this position.

Speaker 2 And obviously I feel

Speaker 2 about it. What does that mean?

Speaker 3 They really pushed. And, you know, so how I got successful is just I got lucky doing what I do for a job

Speaker 3 and leaned on my parents a lot. And they had to take out some loans to get me.
you know, to the point where I'm at now.

Speaker 3 More specifically, it has to do with obviously just the job that I have now.

Speaker 3 And, you know, I thought about changing my careers at one point, and I'm glad I stayed with it because it's, it's been very, very

Speaker 2 successful.

Speaker 1 Yeah. And I hear that.
And I think we can give, I mean, my parents paid for my college, right? I mean, like, there are things that our parents do to give us a leg up that is 100%

Speaker 1 being aware of that and saying that and the gratitude and that. I mean, that I'm not ignoring that at all.

Speaker 1 But also, Michael, you're a 25-year-old man who made decisions with his income where you could have gotten a second home, two cars, and you could be living paycheck to paycheck, even though you make a lot of money.

Speaker 1 You could make other decisions, but you haven't. You've chosen to do things to get out of debt and to save, and you've done those, Michael.
They didn't do those for you.

Speaker 1 And your siblings are an example of like your parents, I'm sure, helped them in certain ways as well, but they've chosen a different path. So, like, I give yourself credit.
Do you know what I mean?

Speaker 1 Like, you, you've, yes, our parents have helped us, and we will always have that gratitude and acknowledgement, always.

Speaker 1 But also, there's a point that we become adults and we get to make our own decisions. And from there is...

Speaker 2 And this isn't even at that level. Here's what I know for certain.
If Dave Ramsey and Sharon Ramsey, I don't know how this happened, but they fell on hard times and they had nowhere to go.

Speaker 2 They have three amazing kids, one of them sitting next to me that would say, y'all come stay at the house.

Speaker 2 Right? We'll help you out. We'll help you get on your feet.
This is not that situation.

Speaker 2 Sure. And so your sense of, you're thinking of your parents' investment in you as some sort of 401 that they put forward.
And if they put that on you, shame on them.

Speaker 2 Parents don't pay for their kids' college as some sort of vehicle, investment vehicle, so that they get a demand a return so that when they want a different color car, you have to be their bank.

Speaker 2 Your parents aren't destitute. They've made a series of choices starting a few years ago.
And they're like, screw this. We're moving out of here.
We want to move far away. And they did.

Speaker 1 Yeah, that's a great point. It's a second home.

Speaker 2 This is second home.

Speaker 1 It's a luxury.

Speaker 2 Yeah. You're right.
Yeah.

Speaker 2 So this isn't, if they, if you're dead, for food then i'm all about it yeah like we're gonna help out mom and dad we're gonna honor our father mother i'm all about that but dude if it's to like pay for their

Speaker 1 yeah their second like loan them money for the second i'm just i'm gonna say no man and uh and and i'll say this too michael knowing my parents with the grandkids they're very emotional right now with this dream of oh my gosh our whole family is about to there's gonna be babies like their emotions are probably driving this as well and so for five years they're gonna be okay yeah they're gonna be okay they're gonna be all right thank you come stay with you anytime she want That's right.

Speaker 1 Thanks for the call, Michael. Hope that helps.

Speaker 1 Welcome back to the Ramsey Show. I'm Rachel Cruz with Dr.
John Deloney, and we are answering your calls about life, money, relationships, anything and everything. So give us a call at 888-825-5225.

Speaker 1 Up next, we are going to Los Angeles and talking to Jessica. Hey, Jessica, welcome to the show.

Speaker 3 Hello. Thank you very much.

Speaker 2 Absolutely.

Speaker 2 How you guys doing?

Speaker 3 We're doing good. We're doing okay.
We're actually about an hour out from LA, so we are not near the fires.

Speaker 2 Oh, good. Oh, so sorry.
I'm thinking about you guys, man. We're a mess, mess, mess.

Speaker 3 Yes, yes. Prayers to everybody who's going through losing their house.
And yes, we've been praying for everybody.

Speaker 2 For sure. How can we help?

Speaker 3 So our question is,

Speaker 3 we did financial PhD university probably about eight years ago. So our house bills are beautiful.

Speaker 3 I heard the guy earlier say that just his mortgage alone is $5,000, our house bills all together come out to about $6,000 per month.

Speaker 2 Okay, okay.

Speaker 3 But we started a business in 2020.

Speaker 3 And

Speaker 3 we got ourselves into $250,000 in debt, which is credit cards and personal loans.

Speaker 2 Jessica. hundred thousand.

Speaker 3 I know I know. A hundred thousand of that is under the business and then the other is we used our personal credit cards.

Speaker 3 Me and my husband we actually did go through some turmoil after 2020 and we were not on the same page. So that is part of what happened with the debt.

Speaker 3 So now we've we started going to church, we're going to counseling. And there is major potential in the business.
But we also have in our home, we do have,

Speaker 3 I don't know, after, you know, closing costs and things like that, but we have some equity in our house. We owe $400,000 and we could potentially sell it for $650,000 to $7,000.

Speaker 3 So the question is,

Speaker 3 do we look into selling the house and getting the debt off of our shoulders and then growing the business? Or do we grow the business and try to pay off the debt while staying in our home?

Speaker 1 I would do the latter. I wouldn't sacrifice the house for this because, to a degree, the business is still a dream, right?

Speaker 1 I mean, it's not, you don't have multiple years of it absolutely killing it, right? I know that has potential, but I would not sell my house on potential. No.

Speaker 1 Give me some numbers around the business. Like, what kind of business is it, and where are you guys at in it?

Speaker 3 Okay, so it is a wellness center and med spa, all in one.

Speaker 3 And the biz bills, the business bills, including paying ourselves,

Speaker 3 is

Speaker 3 $17,000.

Speaker 3 And we make on average

Speaker 3 about $20,000.

Speaker 1 Okay. Is this your only stream of income when you're paying yourself out of the business? Or do you guys have other jobs? This is it.
Like you both are full-time in this.

Speaker 3 We both are full-time in this, yes.

Speaker 1 Okay. So it's making $3,000 a month net.
Is that what you're telling me?

Speaker 3 Yes.

Speaker 2 Okay.

Speaker 3 That's if something doesn't come up unexpected in the business.

Speaker 1 Sure. So what's

Speaker 1 so what's what are you seeing in the business that's causing you to think there's going to be this upward trajectory versus it just continuing to be this and you make three grand a month?

Speaker 3 Like I said earlier, my husband and I, we were not working together on the business. So I was doing it by myself

Speaker 3 for the first three years.

Speaker 3 And just recently, for a year, we've been working together, but we've, like I said, started going to church and counseling. And now,

Speaker 3 as of now, we are on the same page. And we're actually fasting right now for it.

Speaker 3 So we're looking for answers as far as if we work together and we kill it in the business.

Speaker 1 Okay, yeah. So I hear all of that.
So not to, I don't mean to keep being devil's advocate here because everything you've just laid out is incredible.

Speaker 1 I mean, I think from a spiritual perspective that you guys are united in that, you're working on your marriage with a professional. I mean, like you're doing so many incredible things.
So, is your

Speaker 1 thought process because we are becoming more of a united team within our marriage, how is that going to correlate to bringing in more business?

Speaker 1 Just like, just because you guys, just because you guys are just a great team, is that what you're thinking? Like, we're just in a healthier spot. So, it's going to show up in the business?

Speaker 3 Yes.

Speaker 2 Okay. Yes.
Okay.

Speaker 1 Yeah. So, I

Speaker 2 please don't do, please don't do that.

Speaker 1 I would yeah, I'm going to need more evidence, business evidence, not relational evidence, that this business is really taking off because my hope is, is that it will.

Speaker 1 But I think you need to see numbers, Jessica, first and foremost

Speaker 1 in order to to make this proclamation that like, yes, it it's incredible, right? So

Speaker 1 giving it another, you know, 12 months, because you guys, how much are you guys making a year off of it? How much are you paying yourselves? Like, how much will you make this year

Speaker 3 we are paying ourselves and with those numbers that was paying ourselves the

Speaker 3 six thousand

Speaker 1 six thousand

Speaker 1 total a month i'm sorry a month a month between the both of you total or each individually six thousand

Speaker 2 between the both of us total okay bills are six thousand yeah how are you how are you paying your bills how are you guys eating

Speaker 3 so that

Speaker 3 the what we're paying ourselves with what we're paying ourselves, like we're just barely,

Speaker 2 barely barely getting by.

Speaker 2 Okay. Yeah.

Speaker 1 Okay.

Speaker 1 So what I would do, I'm trying to think, if I woke up in your shoes and you have this belief because you've put so much sweat equity into this business and like you said, like, okay, relationally, like we're killing it.

Speaker 1 And I think it's going to help in the business, like give it a try. Like I think, I think continuing to try, but you guys have to make more money.

Speaker 1 And it's not going to come from the business because you're only pocketing three grand a month. I mean, like, you know, from a net standpoint, you're only netting three grand a month.

Speaker 1 And so you're barely above water in this. And so you guys are going to have to find other streams of income.

Speaker 1 You're going to have to get another job until this bit, until this business, yes, um, surpasses. And then you guys can go full time back into it where that's your only job.

Speaker 1 But you guys, I mean, I would not recommend

Speaker 1 living on that tight of a tightrope, right? You're walking a tightrope basically financially.

Speaker 1 So if I were you, I think I would feel more comfortable yeah having a completely another stream of income um

Speaker 1 and maybe that's him going and you know getting another i mean i know you want to work together in the business but i don't know if you guys can afford that right now

Speaker 3 yeah

Speaker 1 and so yeah so i would i would

Speaker 1 i would um and and again my prayer is that this does take off completely and it and it might i mean yeah i mean med spells in la

Speaker 1 great market for it i mean it really is so like i i really pray that it does and then i pray that's killing it and you're like, oh my gosh, husband, I need you back here because I am overwhelmed with work.

Speaker 1 There is so much, you know, you know, so much happening. I need you back.
And you're going to make more. You know what I mean?

Speaker 1 Like when it starts making sense for both of you to be there, that's what I would do.

Speaker 3 And then I would not for him to get another job.

Speaker 2 For him to get another job. I would.
Yes. Would I need to do that also?

Speaker 2 Do I?

Speaker 3 Would I need to do that also? Like a per diem? I'm a registered nurse.

Speaker 2 So would I do that also?

Speaker 1 I would to start knocking out some of this debt.

Speaker 3 yes yeah okay and then in the meantime so is it pretty much doing financial university again and then because in the what do we do with the people who are calling right now the the debtors the are you guys starting the call

Speaker 1 are you guys behind on bills

Speaker 3 yeah so remember we said that um oh so these the numbers that i was uh giving you yeah

Speaker 3 was without what we owe the credit cards. So monthly we owe $10,000 in credit cards.

Speaker 1 And that's not getting paid.

Speaker 3 No, for the past couple months, we stopped.

Speaker 2 Oh, God, sister. Yeah, lead with that next time.
You got to close your med spa. You can't afford it.
You got to go get be a full-time nurse and then work all nights and weekends, too.

Speaker 2 Yeah, you're about to get sued and they're about to start collecting on you.

Speaker 2 You owe ten thousand dollars a month. How much credit card debt do you own? Do you owe?

Speaker 3 That number at the beginning, we 250,000.

Speaker 3 Yeah.

Speaker 2 Yeah,

Speaker 2 y'all are in a big, this is not a time to be

Speaker 2 starting a business that nets a profit of $36,000 a year.

Speaker 2 Like, y'all need to go make a whole bunch of money right now.

Speaker 2 And I guess the good news for you is you've got a golden ticket in your pocket, which is you're a registered nurse. Yeah.
And you can go work all you want and make a bunch of money.

Speaker 1 Yeah, I mean, you guys can't, you can't afford your bills right now. And that's, that's the, that's the reality.
And I'm so sorry that that's what it's come down to.

Speaker 1 But I mean, you can't get behind on these credit cards that you already have for another couple of months.

Speaker 1 Um, so yeah, I think you're gonna, yeah, both of you are gonna have to get full-time jobs outside the med spa.

Speaker 1 Um, and and then maybe this dream can come back into fruition down the road, but it can't, it's not a reality today. You can't do it.
I'm so sorry.

Speaker 1 Welcome back to the Ramsey Show. When it comes to getting your money in order for the new year,

Speaker 1 there's really one foundational

Speaker 1 place principle that you have to have when it comes to getting control of your money, and that is a budget.

Speaker 1 And so when it comes to budgeting, when it comes to everything else of getting yourself in control of your money, we're going to talk about all of that on our live stream on January 23rd.

Speaker 1 It is a free live stream called Take Control of Your Money. It's hosted by Dave Ramsey and Jade Warshaw.
And it's this idea of paycheck-to-paycheck living is so such a reality for so many people.

Speaker 1 And to break that cycle to do something different,

Speaker 1 there are elements of budgeting. There's elements of getting out of debt.
There's elements of looking towards the future and how you're going to build wealth.

Speaker 1 I mean, all of this is so, so key when it comes to winning with money. And so this live stream is for you.
And George Camel and myself, we're going to be joining the live stream a little bit into it.

Speaker 1 And we're going to do some live QA. And so you'll be able to ask your questions and we can answer them right there.
And when you sign up, you'll be entered to win our cash giveaway.

Speaker 1 So we're giving five people $4,000 each. So make sure you sign up at ramseysolutions.com slash live stream or click the link in the description if you're listening on podcasts or watching on YouTube.

Speaker 1 Again, that is January 23rd. It's our free live stream for the new year, kicking it off.
And it's all about taking control of your money.

Speaker 1 All right, let's go to the phones and go to Catherine in Bellevue, Washington. Hey, Catherine, welcome to the show.

Speaker 3 Hi, thank you for taking my call.

Speaker 2 Yes, absolutely.

Speaker 1 How can we help?

Speaker 3 I am looking for a little advice on building my retirement starting at 42 years old.

Speaker 1 All right. So great.

Speaker 1 Okay. What are your questions around it?

Speaker 3 Basically,

Speaker 3 I just don't really know where to begin. There's so much information out there and where to get started, and I don't have any

Speaker 3 support at work as far as 401ks or Roth IRAs or anything like that.

Speaker 1 Okay, so your company does not offer a 401k?

Speaker 3 Correct.

Speaker 1 Correct. Okay.
So really, yeah,

Speaker 1 the two best streams. Do you own the business or are you an employee?

Speaker 3 I'm an employee. I'm a nanny and a house manager for a celebrity up here.

Speaker 2 Oh, okay. That's great.

Speaker 1 Yeah. Okay.
And how much are you making a year?

Speaker 3 170.

Speaker 1 170. Okay.

Speaker 1 Yeah. So for you,

Speaker 1 are you

Speaker 1 like a 10 why am I blinking? A 1040 1049. 1099.
Thank you.

Speaker 3 I collect a W-2 every year.

Speaker 1 Okay. Okay.
So, yep.

Speaker 2 Do you have an LLC?

Speaker 2 Like, would you apply for a a SEP or is this just you're just a W-2 employee going right into your I'm a W-2 employee.

Speaker 3 Yep. It's a massive,

Speaker 3 they have a pretty massive network. So I'm one of probably 300 employees.

Speaker 2 Okay. All right.
Okay.

Speaker 1 Okay. Yeah.
I was going to say because if you were able to,

Speaker 1 yep, get around that in any way, you could do like a, yeah, a self-funded 401k or something for self-employed, but I don't think that would work with the W-2.

Speaker 2 Does your employee offer a 401?

Speaker 3 No.

Speaker 2 Okay.

Speaker 1 So, Catherine, if I were you, I would, yeah, I would do the Roth IRA.

Speaker 1 You do, do,

Speaker 1 yeah, because I think it's $121,000 this year, or I'm not sure in 2025. If you make above that, you're going to have to do what's called a backdoor Roth IRA.

Speaker 1 And so if you make above that income limit, which you do, you're going to have to

Speaker 1 just do what's called a backdoor Roth. And if you sit down with a Smart Vestor Pro, we can get you connected to one, or at least look at options in your area after this call.

Speaker 1 But what you'll do is basically open up a traditional Roth and through all their fancy signages and all the things.

Speaker 1 You kind of basically sign back over and you just basically turn it right into a Roth right there at that sitting.

Speaker 1 It just takes some signatures and it's completely legal, but it's just called the backdoor Roth IRA. So that's an option that you can do.
You can put up to $7,000 in that.

Speaker 1 And then above that, I mean, from a tax perspective,

Speaker 1 there's not, there's not a ton you could do. I mean, I would be investing.
And so looking into just some good growth stock mutual funds and putting some money away.

Speaker 1 And so here, here's the key is 15% of your income is what you want to be investing. And so

Speaker 1 once you max out that Roth, and then I would look above that and say, okay, what's left of that 15%?

Speaker 1 And then I probably would, I would, I would get, you know, you can do even an index fund or just a mutual fund.

Speaker 1 But when you sit down with a Smart Vestor Pro, they can really help you with that because the tax advantage is not great.

Speaker 1 You will pay taxes when you take that money out of retirement, which the Roth you won't. You'll be paying taxes before that.
And so

Speaker 1 that's, yeah, that's kind of the sucky part of it. But I don't, I, I mean,

Speaker 1 I don't know any other great option when it comes to that.

Speaker 1 That's what I would do though. But I would continue to invest that 15%.

Speaker 1 And do you, do you have any debt?

Speaker 3 I don't have any debt.

Speaker 1 Okay. That's great.
Yeah. So our formula, just so you know, Catherine, kind of what we say is match beats Roth beats traditional.
So you always want to start with the match of like a 401k.

Speaker 1 You don't have that.

Speaker 1 So that means you'll just jump over to the Roth, max out the Roth, and then anything else, you'll just go to any type of like kind of traditional accounts, but there's not really great in the retirement lane for you that I can think of.

Speaker 1 But again, I would sit down with the Smart Investor Pro and look at all of your options. But if I were you,

Speaker 1 I mean, even, do you have a HSA?

Speaker 3 No, I don't.

Speaker 2 Okay. Any health insurance at all?

Speaker 3 I do have health insurance, yes. I just don't have the savings account with it.

Speaker 1 Okay. Yeah, because that's another option.
You could put some money and let that grow and cash flow, some medical expenses. That would be another avenue.

Speaker 1 But yeah.

Speaker 1 Okay. Yeah, that's what I would do if I were you.

Speaker 3 The combination of those two things, the backdoor Roth and the 15%, will get me to the finish line in retirement.

Speaker 1 Yeah, absolutely. It should.
Again, I want you to run your numbers. I don't have a computer right here.
42?

Speaker 3 I'm 42.

Speaker 2 How long do you think you're going to make 170 grand?

Speaker 3 There's lots of money to be made up here. So as long as I'm healthy and strong,

Speaker 3 I can do it.

Speaker 1 And you're single, Catherine, did you say?

Speaker 2 Yes. Okay, perfect.

Speaker 1 Yeah, if you go to ramseysolutions.com and just Google Ramsey Solutions Investment Calculator and put that in, put in your numbers, it's actually very encouraging.

Speaker 1 Compound interest will shock you more.

Speaker 2 I'll do it for you right now. What's your name right now? I mean, I'm sorry, what's your age right now? 42.
42. 42.
All right, let's pretend you worked until 67.

Speaker 2 How much do you have in investments right now?

Speaker 3 Nothing. I'm starting at zero right now.

Speaker 2 Starting at zero. Okay, so what's,

Speaker 2 Rachel, what is 50,000?

Speaker 1 Yeah, you'll get about 30.

Speaker 2 About 30 a year you put away?

Speaker 2 Yeah.

Speaker 2 Okay, so if you put away 30,000

Speaker 2 and your annual return

Speaker 1 put zero at that red.

Speaker 2 Oh, yeah, yeah, yeah. All right, so I'm doing this for you with the Ramsey Investment Calculator.
Good gosh.

Speaker 2 If you put away, is that right? $30,000 between now and 67

Speaker 2 and your annual term is about 10%?

Speaker 1 It may be, well, I guess 30 would be on 200,000. So put, sorry, put 25 to be conservative.

Speaker 2 I'll put 20 just for fun.

Speaker 2 You'll have, if you'll put $20,000 a year and you make 10% return on that from $400,000.

Speaker 1 Is that monthly?

Speaker 2 Oh, monthly, yeah.

Speaker 2 I was like, oh, my gosh, we're all going to be. Yeah, you'll have $2.5 million.

Speaker 3 Oh, wow. Okay.
Yeah.

Speaker 2 So that's that's a few and that's and that's pretty conservative that's very conservative if you put two thousand dollars a month in retirement

Speaker 2 okay and you put that away and making 170 with no debt you can put more than that and if you feel comfortable doing a little catch up we're okay with that too i would be a little bit paranoid being 42 with nothing right so i'd want to see that quicker so i might um if i have no bills and no expenses and I'm 170 plus a house manager, which means some of my meals might get covered.

Speaker 2 That means some of my bills might get covered.

Speaker 2 I might take that money and roll it over. But hopefully you hear the main thing here is intentionality with every penny you got.

Speaker 1 Yeah, for sure. And Catherine, I would really encourage you to sit down with the Smart Vestor Pro.
I do this once a year. My husband and I do to look at retirement, run these numbers.

Speaker 1 And again, they, I give them so much credit because I swear every time we go, there's some new thing that they're like teaching me.

Speaker 1 And they're like, oh, yeah, this with this tax, you know, thing here. And you can do this with your giving.

Speaker 1 I mean, they're just, they, they, they live and breathe this stuff stuff and they can be so, so helpful and just give you the confidence to know, okay, this is my plan.

Speaker 1 It doesn't have to be too complicated. It actually, you know, I can kind of set something up and I'm going to be great.
So you're doing great, Catherine. You've done an excellent job up until now.

Speaker 1 So that's awesome.

Speaker 1 If you stay on the line, Catherine, I'll have Christian pick up and just make sure you get that website to our Smart Investor Pros and interview a couple there in that Seattle area and find one that you trust and that you love and start investing.

Speaker 1 Excited for you, Catherine. This is the Ramsey Show.

Speaker 1 Welcome back to The Ramsey Show. We're taking a call now from our Ramsey Network app.
And this question comes from Cassie.

Speaker 2 All right, let's hear from Cassie. I was listening to an older episode recently and it sparked a question.
The caller was a young man with a family well on the journey to financial freedom.

Speaker 2 The host congratulated him for doing so well and encouraged him to stay the course. And he said he couldn't wait to plan a wonderful vacation in the future.

Speaker 2 Shouldn't there be some room for fun and joyful living while on the journey? Seems like most of your callers are so focused on the goal, they forget to have fun.

Speaker 1 Oh, Cassie, well.

Speaker 2 That actually, Ramsey in Latin means fun ruiner.

Speaker 1 We hate fun around here. We don't want you to have any fun.

Speaker 1 So I think it'd be your definition of fun.

Speaker 1 I've just become such a huge, huge fan of Arthur Brooks recently.

Speaker 1 He's just the best. And he talks about like in the latter part of your life, the second half of your life, the people that really do have the most joy is when their wants become smaller and smaller.

Speaker 1 That it's actually, it's not like, what, what do, what, what's my next thing to get?

Speaker 1 It's actually, oh yeah, I just don't need as much as I thought I did. Like the joy in that.
Yeah.

Speaker 1 So what I would say, Cassie, is like during a time of sacrifice of getting out of debt, it's not forever. on average, 18 to 24 months, could be longer, right? Three years of your life.

Speaker 1 Maybe your joy and what you consider fun looks different. In America today, fun is getting a new car, going on a trip.
Like, you know what I mean?

Speaker 1 Like, there's a level of fun that I think we all are just like, oh, yeah, fun, fun, fun. But what if fun is different?

Speaker 1 What if fun is having friends over, which we're doing tomorrow night on a Friday night? Order some pizzas, game nights, kids watch a movie after, have adults hang out and you're at a house.

Speaker 1 You're not paying 100 plus at a restaurant to take everyone out. You just, you switch things up.

Speaker 2 So I don't think it's out of paying for a big fancy date. My wife and I, when we were like, we'd go for long, long hikes.
Yeah.

Speaker 2 And we had hard conversations and we had fun conversations and we laughed a lot. Yeah.
And so, yeah, it just looks different. I think, I think, Cassie here,

Speaker 2 underneath this question, what it sounds like is, hey, it looks like getting out of debt when you go scorched to earth is really hard. And the answer to that is yes.

Speaker 2 And we will all tell you, yeah, if you owe a bank if a bank is running your marriage and a bank is running your life and a car dealership is running your

Speaker 2 work life because you have an abusive boss but you can't quit because you already have that car that you promised the the car company you'd pay back

Speaker 2 that i don't care how much like um little sparkly vacations you're going on you're not having fun Your body is in fight or flight. It's trying to survive.

Speaker 2 And so, yes, for two years, for three years sometimes, Jade's case, seven years, right? Yeah, right, right, right. Yes, it is scorched earth.
The goal is to get to safety.

Speaker 2 And then you get to safety, man. Yeah, of course.
I don't know.

Speaker 2 I mean,

Speaker 2 I don't know that you'll find a group of people that have more fun than we do. We're pretty off the rails and fun looks different for everybody.
I'm in the woods. Y'all are going on trips.

Speaker 2 Jade, I mean, everybody's doing stuff. George is wiping his dog's butts because that's what George does.

Speaker 2 But like we are all, Dave's in Cobbler. Like, we're all over the place having so much fun.

Speaker 1 but our fun's not having us

Speaker 1 when you have the fun that's yeah being all loans right and owed by you know all these banks and stuff yeah to John I think that's a great point John that's not that's not fun it's not fun and again I want to expand our our viewpoint of fun like I just think we get such in this like rat in a wheel new purse new thing I don't know like it's all the stuff that we're like ooh ooh that's fun that's fun I'm like is it really though yeah is it really is it really life-giving because the life-giving stuff probably isn't going to cost you a ton and we know that research says that no when you have there's there's there's there's only so many purses you can have.

Speaker 2 That's right. Now, except for guitars and really fancy hunting rifles, yeah, then those adding those do bring extra joy to your life.
So much joy. That's just that's science.
Just hashtag science.

Speaker 1 It's in the brain.

Speaker 2 It's in the brain. Let's go out to Indianapolis and talk to Sarah with an H.
What's up, Sarah?

Speaker 1 Hey, Sarah.

Speaker 3 Yes, hello. How are you guys doing?

Speaker 2 We're doing all right. How about you?

Speaker 3 Okay, now until 48 hours ago, I felt okay about my situation. Then I started watching your program on YouTube, and now I'm kind of freaking out.
So I want to, like, get some feedback here.

Speaker 2 Okay, pronounce it. Hold on, hold on, Sarah.
Sarah, Sarah, would you do me a huge favor?

Speaker 2 Excuse me? Do me a huge favor. Take a humongous deep breath as deep as you can.

Speaker 3 Okay.

Speaker 2 Hold up. Okay.
Five, four, three, two. Let it out.

Speaker 2 Okay.

Speaker 2 All right. We're on your team.
We're on your team. All right.

Speaker 2 What's keeping you up at night?

Speaker 3 Okay, now I've been in a difficult marriage since day one.

Speaker 3 and in 2012 I filed for divorce and then to get a peaceful divorce without really any problems I had to like give up me like mainly everything all I got was a car ten thousand dollars and I had and child support I had to give up everything else

Speaker 3 my father helped me and I was able to get a house and everything moved on okay

Speaker 3 but under pressure we kind of got back together

Speaker 3 We stayed together for like maybe four years or so. Things were going okay.

Speaker 3 So we decided to get married.

Speaker 1 Remarried. During that period, excuse me? Remarried? Are you talking about your ex

Speaker 1 or a different guy?

Speaker 3 No, not a different guy.

Speaker 2 The same guy.

Speaker 1 Get remarried in what, 2018, 2019?

Speaker 3 Okay, around 2019, yeah, 2018, 2019.

Speaker 3 And then during that time,

Speaker 3 my husband was paying the bills on his house because he did not sell his house. And I was paying all the bills on this house I'm living in.

Speaker 3 Now, when he sold his house, he started paying the bills on this house.

Speaker 3 Now, after we got married, things got worse again, like, and it's not working out.

Speaker 3 So I'm going to file for divorce again.

Speaker 3 And

Speaker 3 my kids now graduated. They have their own lives.
So I feel it's going to be easier to get a divorce. The same thing here.

Speaker 3 He says, if you go to court, I'm going to fight you over the house because it's in my name,

Speaker 3 and I'm going to make everything difficult. So I decided, guess what? Let's just get a divorce.
I don't want anything from you and I'll just keep my stuff.

Speaker 3 I forgot to say something. When we got back together, our finances stayed separate.
Like we're no longer have the same bank account or anything. We're totally separate.

Speaker 2 But what house is he going to fight you over? The one that you and your father purchased together?

Speaker 2 Yes. Why is his name

Speaker 2 on that home?

Speaker 2 No, his name is not on the home. Okay.
Yeah. So what's your question? We're coming up against the clock.
What's your question?

Speaker 3 Now, my question is, now, my plan was, now I'm going to keep the house.

Speaker 2 Okay.

Speaker 3 And I have $100,000 in the bank.

Speaker 3 So I had it in a CD.

Speaker 3 But I got some advice from the bank, and they said you can invest it in the market, and it can get you like money and stuff.

Speaker 3 So I was wondering whether I will be able to kind of be independent on my own because he's the one who brings most of the money, not me.

Speaker 2 Yes, if you get divorced, you have $100,000. And so I won't get into the investment side of it.
You have $100,000.

Speaker 2 If you get divorced, the first thing you need to do is to create your own checking account. and your own budget.
I do.

Speaker 2 And ask, where is money coming from that I'm going to use to survive, pay my bills? Do you have a job? Okay.

Speaker 3 Yes, I'm a teacher. I have a master's degree.

Speaker 2 I'm a teacher. Amazing.
Amazing. My wife's a lifelong teacher.
Amazing. So what you're going to have to do is to create a world where that

Speaker 2 what you make as a teacher funds your life, pays your house note, whatever your remaining mortgage is, pays your light bill, your electric bill, your food, and any travel you're going to see to go see your grandkids whenever your kids have babies.

Speaker 2 And the $100,000 should be invested. And I want you to get with the SmartVestor Pro.
If you hang on the line, we'll get you connected there, okay?

Speaker 3 Should I cut on everything as long as I have a mortgage or can I spend money, for example, go get my hair done, get my It's going to all depend on you sitting down and doing a budget.

Speaker 1 Yeah, so Sarah, what I would live off of, I would keep this $100,000. I would take some of it out of the market for an emergency fund.

Speaker 1 I would get six months of your, well, four-ish months of your expenses. So you have to do a budget, what John's saying, and you have to say, okay, here's how much food costs.

Speaker 1 Here's how much my mortgage is. Here's how much the lights are going to be.
Here is everything that I spend money on in the month. This is how long, this is how much it's going to take me to live.

Speaker 1 And you have to make sure that the salary you make, that's your income every month, can cover those bills. And ideally, that you have margin and you're not living right up at that paycheck.

Speaker 1 And so having that margin is going to be really key. And so that's going to be step one.

Speaker 1 And then from there, I would multiply that by four, whatever that number is, take some of that cash up from that $100,000, put it in a high-yield savings account for for a emergency fund and then start thinking about investing above that hang on the line here so we'll get you hooked up with the smart investor pro and actually we're going to pay for you to have one session with one of our financial coaches and they'll walk you through the budgeting part of this hang on the line we'll get you taken care of