A Large Income Won’t Protect You From Debt

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

I am Rachel Cruz hosting this hour with Jade Warshaw, and we are here to take your calls.

And you can call us at 888-825-5225, and we'll be answering your questions on life and money and career, relationships, all of it, all of it.

So, let's get to the phones this hour.

We have Amy in Pensacola.

Hi, Amy.

Welcome to the show.

Hi, how are you?

We are doing great.

How are you?

Good.

How can we help you?

I'm really, really, yeah, excited to be on the phone.

So, I have a bunch of questions, but

my husband and I are definitely in need to help with overall financial plan.

We have

more than over a million dollars in debt.

Whoa.

What's it in?

Yeah, what's what's the debt in?

Well, we went through a really long school life.

Okay.

So our sch student loan was a million when we graduated.

Oh my gosh.

Wait, you can't just cruise past that.

You got to tell us more.

What are your degrees in, Amy?

So we are both in dental specialists.

So, you know, college, well, we actually didn't have any loans for college.

Dental school, we had loans.

Specialist residencies we actually didn't have loans because my husband served in the military.

So they pay for that.

So just dent to four years of them alone.

We have a million dollars together.

Okay, but you earn a lot of money, right?

I sure hope so.

So we now we came down to like 750.

Also, you know, we're part of it.

But

since he's in the military,

we don't actually earn that much money.

But the good news is he's getting off of military and we're going to start a new job where we should

uh our minimum income will be about 600k okay so wonderful that's good um is this a business that you're opening a practice together is that what it is

actually no um we So we wanted to make sure like our life is in a little bit less of a death before we even think about opening our own.

Sure.

Because that would require a lot more capital.

So you just said we, so I didn't know if you were working together or you were just going out and getting separate jobs.

No,

we are working together in a practice.

Okay.

Together, but we don't own them.

And combined, you'll be making $650,000.

That will be a minimum, yes.

When does that start?

Summer.

Okay, so soon.

And these are guaranteed jobs and salary.

Like, this is what you're going to make.

Yes, so it's a per-production.

So, you know, that's going to be a minimum.

And if you make more, you know, you're going to get more.

Well, that's the great news of this story, Amy.

So for you guys, I mean, I would work to live on 70K.

Uh-huh.

And you throw everything at this debt and you get it paid off in a year and a half and be done.

And then go right off into the sunset making $600,000 a year debt-free.

Like your numbers sound really big, but ratio-wise, it's the same as the person who calls in and makes $60,000 a year and has $100,000 of debt.

Like, that's right.

It sounds a lot because a million dollars is just a big number, but the ratio is the same.

How are you living right now?

Like, tell me about your numbers right now.

What is rent cost?

What are you bringing in right now?

So, that's another question.

Thanks for asking because that will be my next question.

Because we now

technically own a house but not pay off.

Okay.

So, we are planning on,

well, in the beginning before I started listening to you guys show I wanted to either rent this place and buy another place in our new job will be because we have to move

and buy another house.

But then I was thinking that our salon is so high we decide to sell this house, pay our, you know, all the mortgage.

If you sell it, what will it bring?

Doesn't bring much because our

our financial advisor told us to pay as minimum as possible, so we actually didn't pay that much off.

Okay.

We bought this not that long ago, actually, not even three years ago.

So we are trying to sell this and then

buy another house.

Amy, talk in real numbers because right now you're saying, like,

it's all kind of up here.

I want to know real numbers.

If you buy, if you're moving, give us more details.

If you move, where are you moving from?

And then where are you moving to?

If you sell the house, how much will it bring?

And what do you plan on doing with that money?

Like, give us a few more details so we can really dig in with you.

So, we have a mortgage still left for about 370K.

Okay, so you owe 370.

If you sell it, how much will you take home, do you think, after the sale?

Maybe 40K.

And that's after fees and whatnot from the realtor and everything like that.

Okay, so the 40K, you're thinking you're going to roll that into a new mortgage when you move this summer for this job.

Is that what you're thinking?

We were thinking that, but now

we're thinking that maybe we should just rent a plane.

I'm thinking that too.

Yep, yep.

Yeah.

And that's $40,000 more to the student loan.

That makes some progress.

Yeah.

So, Amy, here's going to be your

struggle.

It's not going to be income.

And usually when we're talking to people like this, we're like, you got to get side hustles, all this, all this.

And honestly, with what you guys have, you can have this paid off in a year and a half.

But your problem is going to be, Amy, that you guys are going to, if me and Jade were in this position, I would just tell you, like both of us with our spouses, our decisions would probably be very similar.

We're getting a one-bedroom apartment.

We're living as cheap as possible for two years.

And Amy, the biggest struggle that's going to happen is you're going to get into this new job, into this dental world where people are making insane money, which is great and they should.

They do great work, but they're going to be living insane lives.

I mean, to make $600,000 a year, the trip.

The racing season.

Yeah,

the trips, the cars, the to eat, the parties, the gay, I mean, everything you could imagine, Amy, is the world you're about to step into, and you're not going to be a part of it.

And you're going to say for a year and a half, 18 months, 24 months, we are not going to live like we make $60,000, $600,000.

We're going to live like we make $60,000.

And I'm telling you, the faster that you can just stay in this mentality and get through this, Amy, the unbelievably better part this is going to be.

Not only are you going to appreciate that $600,000 even more, but there's, you're done with this mess.

I mean, yes, your shovel is big and a million dollars is big, but it's a million dollars.

I think to anyone, I mean, it's a gasp.

Like, it's a lot.

And if you just act normal in this, you're going to keep this around for five, six years and you'll make the payments and you'll figure it out, but it's just going to be floating where we want more intensity and be done.

And then you can go get a bad A home.

I mean, you can get so much.

Like this is a lot of people

get so much with this.

The upside is you're moving somewhere where you're brand new and you don't know anyone and you don't have any heirs to keep up.

Like, do you know what I'm saying?

It's harder if you had been, if you had called us and it was five years later and you were in this job making $650, you had the house, you had the cars, you were used to this lifestyle and you had to cut back, it'd be difficult.

But you haven't even got into it yet.

So you, and you don't know anybody yet.

There's no standard to keep up.

Like you can fly under the radar, do your thing, and then after a year and a half, you can pop out.

Like, what's good?

Let's take a trip.

Yes.

Let's spend some money.

So, Amy, the faster you get rid of this, I'm telling you, the faster that burden lifts.

And you guys, I'm so glad you found us.

I know you're kind of early, you're a new listener, but I'm telling you, this is the proven plan.

So, do it.

Do it well.

We're excited for you, Amy.

Congrats on the big education and the big salary.

But make some right decisions here.

This is the Ramsey Show.

Welcome back to The Ramsey Show.

I'm Rachel Cruz, hosting with Jade Warshaw.

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All right, up next, we have Jared in Cleveland.

Hey Jared, welcome to the show.

Hey Rachel, hey Jade, thank you so much for having me.

Absolutely.

How can we help?

Well I am in, well JM doesn't begin to explain it I guess.

I'm a bivocational pastor.

I work 60 hours a week for my secular job and about 30 hours a week in the ministry.

I'm married.

I have two wonderful boys.

Love my church because I love my God.

You know, God's been good to me.

But I've got back against the wall, my back's into the wall, if that's a possible thing.

I've got a mortgage that's out of hand.

I've got two car payments that are out of hand.

Kind of got dealt a bad hand when it came to those particular debts, got lied to in both of them,

and ended up costing me a lot more and stuck me where I kind of didn't have a choice.

But

I'm looking at a mortgage where I'm paying $1,700 a month.

I'm $18,000 in negative equity in my car.

And

I've maxed out my credit.

I've got nowhere to go.

And I could really use some sound, godly advice from you ladies.

Oh, Jared, I'm so sorry.

It's so tough.

I know

it's really stressful.

And especially when you feel like you're trying to do the right thing and it's not gaining traction, then that is difficult.

But yep,

hopefully we can help here.

Okay, so what do you do for your

vocational job that you said?

So I'm an on-call supervisor,

and what I do is I take care of people with developmental disabilities.

Okay, and how much do you make in that job?

My take-home is $1,900, and it's bi-weekly.

Okay, so $1,900 every two weeks.

Correct.

Okay.

So how much do you make as a pastor?

What is that bringing in?

My salary is $1,500 a month, and then I have housing allowance and stuff like that, too.

I don't know if that figures into this or not, though.

Yeah, it does.

So, what's your housing allowance?

Because is that going towards your mortgage?

It is, yes, and it's $1,900.

Okay, good.

So, is your housing allowance covering your mortgage then if your mortgage is $1,700?

Yes, it does cover that, and it usually covers most of the electric bill as well.

Okay, okay.

Yep, that's big.

Okay, and then how much do you owe on the cars?

Um, for mine, I owe just under twenty five thousand, like twenty four seven.

Okay.

And then uh for the other one I owe uh eighty nine hundred.

Okay.

And how much in credit card debt?

Uh

twelve thousand five hundred for the one and then the other ones is a total of thirteen thousand.

Okay.

And does your wife work outside the home at all?

Uh, she she does.

She works from home.

Yeah.

Okay.

What does she earn each month?

Bring home?

She's about,

it depends on the hour she's able to get, but I'd say she's about $800 a month or so, somewhere in there.

What does she do?

She does medical billing.

Okay.

Okay.

So I've got you at $8,000 a month between the two of you.

Obviously,

$1,700 of that is going to the mortgage.

Yeah, the housing allowance.

Okay, so help me.

When I look at this, this, I'm like, okay, mortgage is covered.

There's some debt here.

It's like $6,500 left after mortgage.

So where's it going?

Yeah.

Are you guys on a budget?

Yes, we are on a budget.

Where we're at now,

so the credit card debt that I gave you, one of them was the $12,500.

The other two are through, I'm doing a debt consolidation because they were maxed out and I couldn't afford the minimum payments.

So I moved that into one payment.

And then

also,

I'm trying to, I'm nervous.

I'm nervous to be able to.

Okay, oh, you're fine.

You're fine.

We have time.

We have time.

You're good.

And then

in addition to that,

I pay for my son.

He goes to a private Christian school.

Okay,

that might be an area.

How old are the boys?

My oldest is seven.

My youngest is four.

So seven and four.

How much is tuition for the private school?

It is

$3,700, I want to to say, for the year.

Okay.

What else?

So you're paying $308 a month for...

Yeah, I'm curious, Jared, where the $6,500 is going, though.

Because

how much payments for your car?

How much are they for your car?

My car is $470.

No, $480 a month.

Okay.

And then

I pay for my wife's car as well.

Which is how much?

$240.

Okay, so I've still got you at $5,280.

Keep going.

Okay.

Then there was student loans involved in that.

And that is now no more because the president, he just took those.

Well, let's pretend.

Let's just pretend.

What would the minimum payment?

What was it?

$200.

Okay, minus $200.

So now we're at $5,080.

Keep going.

I'm just helping you work through this.

It's not to try to call you out.

No, not at all.

I appreciate it.

Let me think.

Then

cell phone bills, $190,000 a month.

And then I've got car insurance, which is up at $180,000 a month.

Okay.

Okay.

Then,

of course, you know, we're talking about tithes, so 10% of the amount that I gave you there.

So 800?

Yeah.

Okay.

$3,900.

What's been on these credit cards, Jared?

What are you putting on for $13,000 and $12,000?

Well, a lot of that was

just trying to make the ends meet, not having enough to make the bills.

I just recently, my income is higher the last couple months because I started asking for more hours at work.

Okay, that's good.

So that's new.

It was below that.

Okay, okay.

Okay, so Jared, I mean, just looking at these numbers, there's not like a, oh, I forgot the $3,000 bill here, whatever that is, right?

Like, there's a month.

There's not a big gaping hole.

I'm just, I may just call it out, Jared.

I just feel like you guys have been sloppy.

Would you agree?

Well, I wouldn't disagree.

Yeah, I'm not sure.

And Jared, and I'm going to say this, because you mentioned this, and as believers in this room, I think we're spiritually somewhat consistent.

Scripture has nothing good to say about debt.

Nothing.

Every time debt is mentioned, it is in a negative fashion.

Now, it's not a sin.

We'll still go to heaven.

It's fine if you still got your credit card debt.

Like, okay, everything's fine in that regard.

But the wisdom that comes from every time it is spoken, it is in a negative fashion.

And so in that sense, I would say let's lean on the spiritual conviction that we all believe here from something that is consistent.

And that is.

eliminating debt.

So you've been running to something that is getting you deeper and deeper in a hole, right?

And so I think for you guys, if you tighten this up, Jared, I'm encouraged by it because I think your numbers are there.

I really do.

And so I want you to hang on the line because Christian's going to pick up and we're going to give you every dollar premium.

And I want you to cut up these credit cards.

And I want this to be a moment where a line is drawn for you all.

And you're going to say, no more, we are not running to these credit cards to make minimum payments and make ends meet because you don't need to.

You have thousands of dollars and you have a really blessed situation of even as this as in this pastoral role to have the mortgage paid for with the housing allowance.

I'm like, you guys are in a really great position.

You're going to be working a crap ton.

You're probably exhausted, Jared, working 90 hours a week.

But for a period of time, I mean, truly, if you guys, if you guys threw, I mean, five grand at some of this, I'm like, you could be knocking this stuff out.

I mean, month after month.

And so I would, I would get on a really tight budget, but there is nothing, no expenses going out that are not necessities, Jared.

And you guys can do this.

I really believe in you.

I think you can.

This just has to be a turning point from here on out.

This is The Ramsey Show.

You're listening to The Ramsey Show.

I am your host, Ramsey personality, Jade Warshaw, and I am joined by my co-host today, host of the Rachel Cruz Show.

I've got Rachel Cruz with me to my right.

And guys, we're taking calls all afternoon about your life, what's going on in your financial situation maybe you have questions about things you've read on the internet regarding finance or things you've seen on the news or just whatever's going on in your life give us a call the number is triple eight eight two five two two five and on this show man we're always talking about things that directly affect you and we're always filtering it through how we teach money here which is a series of baby steps you might hear us talk about baby step one or baby step six.

You might hear us talk about things like financial peace university.

You might hear us us use lingo like gazelle intensity or certain things and you're like, what the heck are they talking about?

So here's the thing.

If you're a new listener and you want to dive deeper into the Ramsey baby steps, we want you to go to ramseysolutions.com and click the get started button.

Okay, and what's going to happen here is we're going to help you figure out your best next step for your financial journey based on exactly where you're at today.

You're going to get some education, some knowledge.

We're going to put you on the right track.

So remember, go to ramseysolutions.com and click get started all right let's go straight to the phone lines we've got mark on the line from los angeles california hey mark what's going on i'm headed out your way uh this evening mark to los angeles

awesome awesome thanks for taking my phone call jade and rachel appreciate it you're welcome what's going on a little bit cloudy out here today oh yes

well i hope the weather holds up for me

yes i know i don't think i'll get the sunshine this week but um appreciate it hey thanks for taking my phone call i got a question for you.

I'm looking to purchase a third vehicle, a fun vehicle, and it's approximately $55,000.

And I'm debt-free other than our house, and I'd be paying cash for it.

And I really want it.

It's a pretty rare car, but I think the thing is, in my heart, I'm a really good saver, and I'm a really good giver, but I don't really spend a whole lot of money.

And so I'm just kind of torn on it.

And in my mind, I'm like, okay, this would be great.

A lot of great

family members of my wife and three kids.

You're already emotionally attached to it, I see.

I know, I know, it is.

Mark, how much do you make a year?

And

it's usually around 225.

This year's going to probably be around 350.

350,000.

Very good.

Good income.

And so you said this is going to be your third vehicle?

It would be a third vehicle.

Yep.

Purely just fun as a toy.

Yeah.

How much do you already have tied up in your other two vehicles, value-wise?

My wife's car is worth about $45,000 and my car is worth about $15,000 daily drivers.

15.

So I don't know.

Yeah, probably $60,000 I have total tied up in cars right now.

Okay.

Yeah, because kind of our rule of thumb, Mark, is that we don't want more than 50% of your take-home pay for the year, annual take-home pay, to be more

to have, you know, motors and wheels.

So you want at least half of that, but you make, I mean, you make great money.

So you're going to be under that

just under that rule.

Yeah, just barely under that, under that rule of thumb, if you will, because we just don't want so much tight end of your net worth being in

things that have wheels and motors because those tend to go down in value so quickly.

So, but I mean, technically, yeah, you're in that space.

Are you guys, you guys have good other savings?

Do you have an emergency fund and everything?

Yeah, I have

about 200,000 cash on hand.

Okay, very good.

Why so much cash on hand?

Yeah.

You know, I had had some investments and I we've just we've done really well this year, and so we've had a lot of cash come in.

And so I just I haven't invested it other than just small stuff like,

you know, three percent to five percent interest in the market and stuff like that.

But

you know, I've got I have other other retirement funds already set up as well.

So we're in good shape.

It's just

you know, it's one of those those things I,

like I said, I'm such a saver and I'm such a giver.

It just, but like spending that kind of money, it actually has me worried about it.

So I'm like, well, I'll just give a, give you guys a call because I love listening to your guys' show.

And you guys have such great advice.

And,

you know, I just don't want to get something and have that buyer's remorse.

Or, you know, everything's so inflated.

Housing market, car market is so inflated.

It is, but I think you're doing great.

And I think that there's things that are part of, it's just part of financial life and inflation is part of life and I think that when you're in a situation like yours where you've done really well with your money you've been smart with your money you've got to live life while life is here to live you know what I'm saying that's right absolutely and you know I'm guessing are the the 55k is it going to come out of this 200 that's cash that you have sitting or is it separate even from that

No, it would.

Okay.

It would.

It would come out of that.

Yeah, and then have about 200,000 in retirement.

And then,

yeah, have about $600,000 equity in our house.

Very good.

That's great.

And are you contributing 15% or more, you know, 15% to your retirement currently?

Yes.

Yes.

Very good.

Yes, I've got saving that and then also have a pension system too that I'm on.

So

yeah.

All right, Mark.

Mark, it's a green light from us.

That's fun.

Yeah, you think so?

Okay.

Yes, yeah, because

I've always put family first.

This is an experience for you, though, though, is what it sounds like, right?

It's that, and it's all ratios, Mark.

I mean, if you called us and you were making, you know, $75,000, you wanted to spend $55,000 and you still had credit card debt and student loans, I mean, it would be a different answer.

It's all about where you're at and ratios of your life.

And you're in a situation, you've set yourself up so well.

So kudos to you for doing.

you know, the really hard work of that foundation of saying, hey, we're going to get out of debt and have an emergency fund, have some other savings on hand.

We're going to be doing retirement.

I mean, you've done it all so well.

You make great great money.

So it's all around ratios.

And this is not, um,

yeah, I mean, you're, you're in that formula.

You're in that line.

So let me ask this, Mark, because we always, this is what Winston and I say sometimes if we go to buy something that's kind of bigger and we're like, oh my gosh.

So say you bought this and you had no insurance, it burned to the ground, you never have it.

There you go.

Does it make you lose sleep at night?

Besides the fact that you loved it and it's gone now, but just financially, does it absolutely put you in a panic?

No, no, no.

I we're in good shape.

Like I said, I don't owe anything except for a house payment.

And so

we're in good shape.

And there you go.

I think that's a great emotional.

Well, the answer from us is yes.

Thank you so much for that call, Mark.

Hey, I love getting to say yes.

I know.

I think people think we say no all the time.

We're always like,

we're like, no, no, sacrifice, get out of debt.

Yes.

But when you've done it all, it's like, this is the live like no one else.

So later you can live and give like no one else.

And I love to say, too, that he's like, I'm such, I'm a saver and I'm a giver, but the spending, it's always hard.

And we get that a lot, that people shifting that.

So, so actually enjoying your money, enjoying the money that you've worked for, enjoying the progress that you've made with the money you have.

Absolutely.

All of that is a reason to celebrate and to enjoy life.

And I love, I want to highlight this because I think sometimes, you know, Rachel, it's intense what we're.

teaching and preaching over here.

It's intense.

And I think sometimes people follow that intensity past baby step three and they don't take those moments to go, okay, like I paid off my debt.

I saved up this money.

Like I can do a little something, something for myself.

That's right.

And sometimes people speed right through and they want to pay off their house before they do something like upgrade or buy a car.

And I'm like, guys, no, chill out.

Like just.

Cool out for a second and enjoy all this hard work that you've done when it's within reason.

That's right.

We laid out the math for him.

There's, there's method to the madness.

It's not just go spin, spin, spin.

But man, you got to learn to enjoy some of this.

You've done the work and

you can give your money, you can save your money and you get to spend your money.

That's a big part.

So love it, Mark.

So I appreciate, I appreciate the call because

like you said, Jade, it can be, it's a psychological game almost that once you have sacrificed and saved and put things away and said, no, no, no, saying yes to yourself can be difficult and it can be hard.

So that's why I think looking at the math.

is so helpful because math doesn't have emotion.

Like it doesn't care.

But when you see it and you're like, okay, good, that's less than 50% of what we make a year is tied up in, you know, in motors and wheels and all the things.

We're in a place that we can do that.

Okay, this is smart.

This is wise.

That's the math.

And that's where logic really can come into play when your emotions are all over the place.

I love that.

Math, math doesn't have any emotions.

I love that.

And look, don't let the economy, don't let what's going on in the world when you've done well,

don't let it scare you into not being able to enjoy yourself.

Don't let it cripple you with fear.

And that goes on each side.

You know, whether you're trying to get your money in place while you're trying to to do the right thing, it's always the right time to do the right thing.

So don't let anything hold you back.

Don't let anything scare you.

This is life.

Life is cyclical.

There's ups, there's downs.

That's the way the economy goes.

Don't let that scare you.

I'm proud of Mark.

He gets to buy himself a new car.

This is the Ramsey Show.

Thanks for being with us.

You're listening to the Ramsey Show.

I'm Jade Warshaw, your co-host, and I'm here with Rachel Cruz this is a great time hey guys if you've got calls we want to take your calls the number here is triple eight eight two five five two two five and uh let's take a call Rachel let's see what Megan is talking about in Dallas Texas what's going on Megan

hi Jade hi Rachel

So I just graduated with my master's in August.

However, my mother passed away in June.

Oh, I'm so sorry.

And yeah, I've been living with them for some time because I had a problem.

I've been sober for seven years.

So I was like living with them while I was going to school.

And now I have my new job and I'm making like $60,000 a year.

I have a car payment and I have some credit card debt.

I also have $15,000 cash and $27,000 in retirement.

The thing is, is like I...

I feel like I'm not really intentional with my money because I still live with my dad.

So I still kind of feel like a perpetual 18-year-old because I'm like, ah, it's okay.

I pay my credit cards off every month, but I use my credit card so much

that it's like I don't save any money.

So I was thinking like, I probably ought to just move out to like get more serious and independent with my money.

However, part of me doesn't want to leave him right now because it hasn't even been a year since my mom passed away.

What's her passing?

Was it sudden, Megan, or was it?

So she was like, she was, she was sick since like 2021.

She was doing really well.

And then she went to the hospital and all this other stuff and she got COVID and then her organs started shutting down.

Oh my gosh.

So yeah, it was like really, really crappy.

So it was kind of sudden.

Me and my dad both believed that she would get better.

Unfortunately, that's not what God had planned.

But like, I just don't know because like my dad has never lived on his own.

He has seven brothers and sisters who went straight to the army and then him and my mom got married while they were both in the army.

So it's like

it's hard because I don't want to just leave him with no one.

You know, number one, I'm so sorry.

That sounds just unthinkable.

It's so tough navigating a loss like that.

And, you know, I'm I'm just thinking about in a lot of situations, especially dealing with money, we would tell people not to move quickly.

You know, take time to grieve and take time to adjust to this change.

And I feel like in this same situation, it applies.

I don't feel like you need to be in a rush to do anything.

Like you said, it hasn't even been a year.

It hasn't been a long span of time.

I'm okay with you doing whatever you need to do to process this.

If that's that's staying at home a little bit longer.

While you're there, I do think it's important that you think about a plan of what's going to happen next.

Yeah.

You know?

Because I like, I got the Every Dollar app

and I'm like looking at my spending and I'm like, holy crap, girl, like you're nuts with money.

No, you're not.

You're not nuts, Megan.

with money.

That's that's yeah, but you are a daughter who lost her mom.

And so that, that brain fog, the processing that that has to go through,

what you go through, it's a lot.

And so was there probably some spending you did maybe to feel better and to feel good?

And,

you know, was there a level of that maybe?

I'm not sure.

Possibly you could say yes or no to that.

But I don't want you to sit there and just absolutely wring yourself out on this.

I mean, you've gone through a tragedy.

And so I think you're starting to kind of come out of it the way you're talking and you're kind of seeing, okay, I need to kind of get into, I need to get my money in under control.

I need to start looking and to see, okay, how can I be an adult?

But yet here's my grieving dad over here.

But I would say with that relationship too, Megan,

you know, we love our parents and honor them, but also he can't be your responsibility.

You can't be the thing that saves him because then that's how you're going to spend your entire life.

And he has to be able to do that work on his own.

And he may, he may grieve and feel lonely and all that.

And you can be a great daughter and walk beside him.

And maybe there's still a season, like Jade said, that you don't move out right now, right?

Maybe it's all still feels fresh and you're like, I want to get a few things under my belt.

And so I'm going to stay here.

And maybe have a date that you talk to him about to say, Hey, Dad, I'm looking at this and be honest with him and say, Dad, I'm nervous to leave.

I don't want to leave you.

I feel bad leaving you.

And you guys talk through that.

But also, I want you to know, Megan, you know, you, you can't, he can't be your, you can't be his responsibility.

He can't be your responsibility.

That's right.

There can't be that codependence there.

There kind of has to be that breaking that you do have to stand on your own at some point.

But again, you don't have to rush that.

We're not telling you to rush it.

But I do want you to think about that.

You're not a bad daughter or you're not being mean or cruel if you say, man, I need to get my own apartment

and start, you know, really doing my life this way and all of that.

That is not negligent or cruel.

Because you're both going to grieve in different ways.

Yes.

You know,

and that time process is going to be different for both of you.

So you might be at a point where it's like, okay, like I feel like I'm coming out of this fog a little bit.

I feel like I'm ready to, you know, go to this next stage.

And he might still be feeling like, oh, like I could really use somebody here at the house, but, you know, that's when it's going to be time to have those tough conversations.

I do like that you're looking at your money and that you're realizing that something's going to have to change in order for you to stand on your own when that time comes.

And I, I love that you're looking at, are you using every dollar?

Yeah, I like, so I'm 30.

You know what I mean?

And like, I'm still single.

And I'm like, I wouldn't want to be a 30-year-old man still living at home.

Sure.

So that's like, yeah,

and I think too, you know?

Yeah.

Because like, I'm 30.

I don't want to be like 40 having my first child.

Right.

So let's,

so it's like six in one, half a dozen in the other because it seems like almost every day for him is a bad day

so yeah has he done

do you guys have a great church a good pastor or a good or a therapist or any anyone speaking into this process of your mom's loss he um he goes to church every sunday with my aunt and then also i got him to go to grief share that's great good good at a local church and i'm like trying to ease in the counseling thing like he said probably he might ought to yeah yeah yeah because i mean the big goal too i feel like i sound like dr john deloney a little bit but but to become whole people through this journey as well megan right there there can be that level of healing and so for you that may look like the next step is to say hey dad i'm going to sit down and and here's the date you know by may of this year um here's here's what my plan is and i i still want to be there for you and still support you where I can.

And then, Megan, you know, as you're calling in for this show specifically with your money, like what Jade was saying.

And then you start, you can even start now working the baby steps.

You can start now.

You have the Every Dollar app, start looking at all your credit card debt, list it out, list out the car, keep your retirement, don't cash it out, but you have $15,000 of cash, which is wonderful.

Yep, to throw some of that at the debt.

Start getting some of these quick wins with your money.

And that's also going to breed a level of confidence for you to maybe even say, okay, I can do this and step out and start living on my own and really taking that turn because you can, Megan, you can do this.

You definitely can.

And in every dollar, one of my favorite features, Megan, is the financial roadmap.

And you can plug in all your numbers and you can actually start to see the date that you'll be debt-free, the date that you'll have, you know, three to six months of savings.

And that's something that will build a lot of confidence and help you to see, okay, what would happen if I were to put more on my debt?

What would happen if I were to put less on my debt?

So you can really customize that timeline so that this can become a real, a reality for you moving forward.

Yeah, and hang on the line, Megan, because we'll give you and your dad two separate codes to have Financial Peace University for a year.

Because I would love him to maybe go through it as well on his own.

Because, like you said, he's never lived on his own.

He's always had someone with him.

And so giving him a little bit of boost in this area of his life, we would love to gift both of you that.

So Austin will pick up

and give both those.

Own your past, change your future.

Yes, yeah, throw one of those in too.

Throw two of those in, guys, for both of them because we do.

We want to see you and your dad

do really well out of this really excruciating, terrible loss.

I'm so sorry, Megan.

I'm glad you called in.

That was a tough call.

I appreciate you guys joining us for today.

That does it for today's show.

Be sure to join us next time when it comes to changing your money.

You can tell me you won't do it, but please don't tell me you can't.

This is the Ramsey Show.

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

I am Rachel Cruz hosting this hour with fellow Ramsey personality and great friend, Jade Warshaw.

And we are taking Your Calls America, free call anywhere in the country at 888-825-5225.

So give us a call.

All right, up next, we have Alexandra on the line.

Hey, alexandra welcome to the show hi rachel and jade how are you we are doing great doing great how can we help

okay so i'm in a bit of a situation here um so

we we purchased date well okay so we closed out our house um on the 24th of august oh congratulations

thank you i don't know how we got it but we went in with it all we had um kind of desperate just wanting to get out of a twenty one hundred dollar rent and now yep and then we're at a $1,400 mortgage now.

First-time homebuyers, we've been together since sixth grade.

We're 37 years old.

We have two kids and gardeners that just started, the Twin Boys, sorry this year.

So this is our situation.

We closed.

We moved.

So we're, I think, about two hours north from his previous job.

And I say previous because two weeks after we closed, he lost his job.

Oh, man.

So no fault of his own.

Yeah, no fault of his own.

It was just, you know, a car that was given to him so that he can drive to work.

He was doing that, you know, obviously every day.

And so now he didn't have a transportation to get there because I need the car to bring the kids to work to school because they just started school this year.

So

he's unemployed right now.

This is my husband.

But

I'm so scared because, and I'm hoping that he can get into something, right, very soon.

We were able to make, so we closed in August.

Our first

mortgage payment was on the 1st.

We were able to make that, so we sent it out.

That's done.

And it's $1,400, right?

And so now we're having to pay again, you know, on the 1st.

We only have like $1,600 in savings.

The big thing is if he, so we're hoping he can get into this new job next week.

So it's going to be a little bit of a pay cut.

So it'll be at 62 a year.

He was earning more closer to 80 a year.

But now we're out in the country, farm life.

This is what we wanted.

This is what we get.

He's going to get paid less.

Sure.

So he's on at 62.

Can you pay all the bills with him at 62?

I think we can because if we were already doing it then and

yeah, he was making more, but we were spending much more.

And then now I'm like, uh-uh, when I'm doing that,

you know, so

we can, I know we can.

But this is the thing, let me get to it quick.

The RV, we have an RV that is 30K, a note of 30K on it, and the payment is $400 a month.

I don't know what to do

with it because we're just parked in our land here.

And it's a 2017.

We got it desperately in 2021 because we were needing to get out of an apartment that we were living in and the house that we had, you know, we were trying to get into at that time, the sale didn't go through so that I won't have to re-lease a network contract, we just went to a campground.

And so we got the RV and then we just kept house searching.

We found the house and then so here we still have it.

What can you sell it for?

I don't know, to be honest.

I'm sure it's going to be less than what we owe.

Yeah, you'll take a hit on it.

But you're just trying to stop the payments and stop the depreciation from taking on it.

So we don't have any late payments on it.

We were able to make that last month, but this is the month right now coming up.

This one in November is the one that's going to hit us.

I don't know how we're going to do it.

When will you know if your husband has the job?

He will find out Monday.

And I want to go within 90%.

They're going to take him on.

Yeah, okay, good.

Yeah, and so it's going to be a pay cut.

You know,

yeah.

So I want you, the first thing I want you doing is you've got a lot going on.

And I can tell by the way you're telling the situation, it's like you're just like, and this, did it, did it, and you're just keeping going.

And I want to kind of clear your head a little bit tonight.

When you get off the phone, you guys sit down,

run the numbers, use every dollar, open up every dollar budget.

If you don't have it, Austin will get it to you.

And I want you to run the numbers for your paycheck and his paycheck at the 62,000.

All right.

Then I want you to run the numbers just in case he doesn't get this job and go, what do we need coming in the house to make sure we're able to fill it?

Because once you have those numbers in your head, Alexandria, you're going to feel so much better because at least you'll know what the real numbers are, what the anecdote is, and then you'll be able to make a game plan going forward.

What I really want to hone in on, and I think Rachel will do a good job with this too, is I want you guys, there's a lot of desperate moves going on.

Everything is, oh, we got desperate and we had to do this.

And then we got desperate and we had to do this.

And we got desperate.

And the chain here, the pattern that's happened is when you guys get desperate, you do, you make bad choices.

And I want that, that's got to stop today.

So what that looks like is it in the here and now, making a plan for the here and now, but not only that, but going forward, I want you guys to be on a plan with your money.

So you know what your goals are, you know what's going, you know what's coming down the pike and you're in control and you're happening to your life instead of everything around you just happening to you guys and you're reacting and you know you're on the balls of your feet all the time.

That's got to change.

And I think that a plan for your money is going to help you.

Have you ever heard of Financial Peace University?

So, no.

Just recently I started listening to you guys.

I, to be honest, I grew up, I want to say in the ghetto, to be honest.

I never had money in my life.

Both my mom and dad just worked just to take care of five of us, you know.

So,

you know, I just grew up, you know, working and paycheck to paycheck, you know, rent, rent, rent, rent, rent all my life until we were finally able to get this.

And it was through an FHA.

That's why I say we got in

lucky to get it.

But, you know, here we are.

We're so happy.

We have a nice little house.

Sure, sure.

But also, you're so happy, but you're also very stressed.

Okay.

So what we want you to see is, and Jade's exactly right, being proactive with your money versus reactive.

And you just said it.

And I think the way we grow up with money is a huge part of our story.

And that's what was modeled for you.

But now the beautiful thing is now you get to change that.

So Alexandra, stay on the line.

Austin's going to to pick up and we're going to give you every dollar premium, which is our budgeting app that will

attach to your checking account.

And you guys will be able to bring in transactions.

You'll be able in real time to be budgeting your expenses, what Jade was saying.

And we're going to give you Financial Peace University, which is our nine-lesson course.

And you and your husband, you guys need to learn how this stuff works.

And Alexandra, I'm going to warn you.

It's going to feel uncomfortable.

You said you're new to all of this.

And when you, you have to get to this point and you're there.

I feel it in your voice and why you called is you are not happy with your current situation what you guys have done that led you up to this point yes he lost his job unbeknownst to him i get it stuff has happened you are not happy with where you are which means you have to change what you've been doing and change is hard alexandra it's hard and so you're going to be doing some painful things that are going to feel uncomfortable because they're new but they're the right things to be doing we are the best in the business at getting people in control of their money so listen to the plan follow the plan don't stray from it and so looking at your numbers getting facts on paper is going to give you some breathing room.

You're probably going to be selling the RV.

You guys may have to take a second job in order to float the bills for the next month, which is okay.

Hopefully, he gets his job and you guys are on track.

But you guys got to get your craft together, craft together, because you're going to end up in the same place again.

But we believe you guys can do it.

You can.

You can.

You got to make the change.

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Okay, so today's question comes from Evan in Kansas.

He says, my wife and I are debt-free, except our mortgage, which we owe $120,000 on.

My wife recently quit her job to stay at home with our baby.

And now after all our basic expenses are paid, there's nothing left over.

We've been contemplating ways to save and the only area we could really cut is food.

We're considering going to some of the many food pantries in our city a few times a month to get the majority of our food so we could still have a couple hundred dollars to throw out the mortgage.

Is this ethical considering I have a stable job and it's not like we'd go hungry without without the food pantry?

We agree that once our mortgage is paid, we would donate these food pantry items to give back.

Is this the wrong way to become debt-free?

I'm going to go with, yes, I would not do that.

I, you know, you said it best, Evan, you said, you know, you've got a stable job and you don't need this.

And I think food pantries are really there for people who need it, like they're in need.

And There's also the side of this where, again, we kind of talked about this earlier in the show, if you choose the stay-at-home route or you choose any route that's going to have one of the spouses not working, then you make that bed and so you lay in it.

And that's not a bad thing.

It's just you've both decided, okay, this is going to take down our income significantly and we're okay with that.

And then you've decided if this means it's going to take a lot longer to pay off the mortgage, you two decide on that.

And I would not

use like community resources basically for, yeah, that are not of need.

Yeah, I wouldn't do it.

Yeah, I don't think i would either i wouldn't do that so and i think he knows that to jade's point yeah he wouldn't probably be asking if he didn't feel great about it yeah yeah so i think again it's it's a maybe a shift in the budget maybe it's waiting a year or two and you'll get a raise and you can use some of that margin um because when you get to the point of paying off your house that's where we always say you can kind of relax off the accelerator and you make decisions then you know that may be different than baby steps one through three right um and the baby's gonna grow up and she might decide when the baby goes goes to kindergarten, she goes back to work, and then you guys are, you know,

going forward again.

Absolutely.

Well, thanks for the question, Evan.

All right.

Next, we have Connor in Jackson, Mississippi.

Hey, Connor, welcome to the show.

Hey, guys.

Thank you all for having me on.

Absolutely.

How can we help?

So I am a 19-year-old college student.

in the Mississippi area, but I'm also a business owner.

And I'm kind of teetering on.

This is my second second year of college I'm at a community college

in my local hometown and I'm just trying to figure out if I want to go off and

pursue a four-year degree from a university or should I stay at home and continue working on my business what's your business so I own a landscape company

it started off as you know just a side hustle when I could first start driving at 16 I um just bought a push mower from Home Depot and started mowing yards.

There for you, Connor.

Thank you.

Over time, it just got bigger and bigger.

Now we have three full-time employees plus myself.

Dang.

How much are you making a month off this?

So it varies.

Obviously, you know, in the winter,

we don't do as much.

But right now, we're doing about

last, I'll say this, last month we did 40,000 in sales um

what do you take home i think

i will i mean

i i try and spend as much as possible i try and reinvest as much as possible since i'm young i don't really have any bills i do live in an apartment yeah but um i i really don't have if you if you did if you did though because what you're talking about not going to college at some point then it's like okay well you're going to get your own place and you're going to do you're going to need income so if you did draw on income what do you think think it'd be?

If I needed to, I could probably scratch out of probably about $60,000 a year right now.

Okay, that's great.

So the question is, do you go to college or work on the business that's growing?

What do you want to do, Connor?

Are you enjoying this business?

Are you wanting to do this full-time?

Are you going to go to school?

Is your mindset for going to college to help grow the current business or to start something new?

Get a different degree?

Like, what would be the four-year college goal?

It would probably, probably, so my major right now is just a business administration.

It's not in like landscape architecture or anything like that.

I'm not necessarily tied down to landscaping, but I do enjoy working with my hands.

But what I enjoy more is being a business owner.

I've always been an entrepreneur ever since I was young

between.

flipping shoes and clothes and buying stuff low and selling it high.

Yeah.

It's just always, it's in my blood.

I think that's a great indicator because obviously the college and university route is not for everybody growing in your education is for everybody um what i would say is really looking at your five to ten year picture if you when you picture yourself in five years what do you see yourself doing and when you look and then when you reverse engineer that you go okay does that require me having a degree how did i get there like really think through that because

you know

there's the societal timeline of when you're 18, you go to college.

But if you're not ready to do that yet, and if you can't afford to go there yet, yeah.

Well, I mean, because I was going to say, Connor, there's, you know, you go to college to either get some type of degree to get you in a field that you need, right?

And there still are definitely routes, career routes that require a college degree.

And you mentioned like landscape architect, right?

Maybe there's an architectural degree that you need because you want to work for this firm in five years.

Like there's a, there's a route.

So you're getting somewhere.

But I would personally, I would not go and get a business degree and spend 60, 70,000 because you know what, Connor, I'll be honest, you're learning a heck of a lot more running your own business than you're going to be some theory sitting in business class.

It's going to be behind anyway.

I mean, honestly, seriously, it's so true.

And like the life experience that you have is so much greater than usually what you can learn in a classroom.

Not always, but in a business entrepreneurial route, people run and grow businesses all the time without a college degree.

And you're getting, you know, a really basic degree, you know, degree there with your community college, which I think is really smart to do.

I do too.

But I mean, if your goal is to have this company, continue to grow it,

I don't play that out.

You don't need a college degree to do that.

So I would save the investment of what you would pay for college and continue down this route if I were you.

But again, if you get into something that's a little bit more specific and tied to some type of licensing or, you know, degree that you need, then maybe you look into it.

But for now, Connor, I mean, you're killing it.

Is there anybody that's $40,000 with three employees last year?

I mean, it's pretty impressive.

Do you have

a business that's doing what you want to be doing that you're watching?

Yes, so I actually have two mentors.

Before I started my own company, when I was 15, I worked for one of my good buddies.

His dad has been in the landscaping industry for 30 years, probably.

And he's very large, and he did not go to college either.

And so he is from a suburb of Jackson.

And as Jackson in the metro area grew, he just like his name just spread out everywhere.

And he does multi-millionaire sales every single year.

Oh, I believe that.

Commercial.

It's all residential.

And so that's kind of what I want to do.

And I talk to him very, very often.

Okay, great.

You know, I hold on the line, Connor.

And Christian's going to pick up and we'll give you a copy of Entree Leadership because I think there is a, what you're experiencing as a small business, I mean, you're having to lead people, which is what you really enjoy running that business side, but it can be tricky.

And as you continue to grow it, there's going to be.

you know, more avenues to go down and it's going to get a little bit more complicated.

And then the entrepreneurial side that is so ingrained in you, you obviously have that inside of you, which is just amazing.

So we'll send you a copy of Entree Leadership and make sure to check out even the podcasts.

We We have a yeah, part of Ramsey is helping small businesses because we believe in we think it is the backbone of America and it's incredible.

So Connor, 19 years old guy, man, kid, I was gonna call you kid.

You're not a kid.

A man.

A man, yeah, but you're doing really great, Connor.

So I appreciate the call.

This is the Ramsey Show.

Welcome back to the Ramsey Show.

I am Rachel Cruz, hosting this hour with Jade Warshaw.

And we're taking your calls at 888-825-5225.

Up next we have Sharon in Springfield.

Hi Sharon, welcome to the show.

Hi, thanks so much for having me today.

Absolutely.

How can we help?

Well my husband's been handling our finances for the last, we've been married almost 20 years, and to the point that I really don't know what's going on in our finances largely.

I say in a lot of ways he controls a lot of what what we spend and how we spend it.

And we'll have financial discussions and we'll talk about it, but I don't really have a full understanding of our financial picture when we make decisions.

Okay.

And I can't get him to sit down and make a budget.

Now, we've been through the Ramsey programs, you know,

I think we've been through them twice.

We've even been out of consumer debt in the past, but keeping a consistent budget is a problem.

I am the breadwinner in the family, and I'm wondering if it's worth just pulling my money out of our joint account and keeping my money separate so that I can at least budget part of what our income is.

Why won't he budget?

Like when you say, hey, I want to sit down and do this, what's his reason?

Is it he doesn't have time?

He doesn't think it's like what's his

problem.

I think a lot of it is just understanding like

how to plan for

little things that come up with the kids, like

costumes that the kids need for programs or

posters that they need to, you know, for school presentations.

You know,

making sure we've got money for those little things.

And of course there's more than just what the kids are.

And he doesn't want to do that or you want to do that and he doesn't think that's necessary to plan for those details.

He's hesitant about the zero, like the

getting all of the money and giving it a name.

Like I hear that a lot.

Take all the money, give all the money a name, and

zero budget.

But it doesn't mean zero dollars in the account.

Maybe that's what's making him nervous.

I'm sorry, say that again?

So zero based budget doesn't mean zero dollars in the account.

And that might be really clear, like really important to make clear to him.

Zero-based budget simply means...

We've talked about that.

Okay, so he knows that.

So at the beginning of this call, Sharon, you mentioned that he is

more the one that's controlling all the finances.

What does that mean?

Does that mean do you have a debit card to your account that you share with him and you go and buy the costumes for the kids?

Or how is the money flow happening right now?

I do have a debit card.

I spend very little of the money out of the account without at least clearing it with him first because I'm so blind to what's there.

Why?

Why do you feel the need to ask his permission?

Because

we don't have a budget, so I don't know what money is there and how to use it.

Okay, let's get down to it.

Because our screen says, my husband has been withholding money,

has been withholding finances from me for our entire marriage.

And that sounds different than what you're saying.

So help us understand.

Well, yeah, he does withhold all of the information about

the account, yes.

So

you ask permission to spend because you have no idea what money's in there.

So it's just you're you don't want to blindly spend with the debit card.

Can you not log in to the do you have

the login information, Sharon?

I don't currently have the login information.

Have you asked it for him and he what does he say?

I have asked him for it and I have tried to look at it.

Not here recently, but I have tried to look at it and I'm so overwhelmed.

Like, I don't even know where to start.

So he gave it to you or he didn't give it to you?

He logged in himself.

He logged in himself and let you look over his shoulder.

Oh, Sharon, that makes me nervous.

Yeah, I think at this point, I would be okay with you having your own account.

But hear me say, Sharon, that this

is going to fix one part of it that you're going to have money to be able to spend, but it's not going to fix your marriage.

This is a temporary solution to really dive into the deeper parts.

Because Sharon, what makes me nervous is, and we've seen situations like this, that if you don't know where the money's going,

I would be very highly concerned that there's stuff going on in other parts of your marriage that you have no clue about.

Yeah, you don't know what he's hiding.

Do you feel that?

Yes.

In some ways, yes.

Okay.

Okay.

Yeah,

I would start laying down an ultimatum with him.

And again, this is, and for anyone listening right now, this is regardless of Sharon is the breadwinner or not.

Okay.

So her making the money, great.

But even if Sharon was a stay-at-home mom, my viewpoint would be the exact same.

Because as a married couple, as you guys, you are a team working together and he has control issues.

And sometimes, Sharon, and I'm going to just say this and you can correct me in here, but sometimes it puts you in a dangerous situation with a lot of abusive husbands.

They use a level of power and control that you can't even go to the grocery store.

Has there been abuse in your marriage in the past 20 years?

Physical abuse?

No.

Okay.

Never.

Do you feel in danger?

Like, do you feel like there's danger in your home?

No.

I feel like my husband is very insecure, and so he's trying to keep hold of the money so that I

can't leave.

I know that sounds terrible.

No, no, no, that's the truth.

That's very true.

That's what's going on.

Yeah.

Do you guys have kids?

We do.

We've got two kids.

How old are they?

Almost 9 and 13.

They're both about to have birthdays.

Okay.

Yeah,

I would have an ultimatum conversation.

And it is,

you're going to give me all this login information.

Yeah.

And

I want to see everything that's been going on.

Any bills?

Do you know how many credit cards he has?

I believe we've just got one active credit card.

I would ask him to pull his credit report.

And pull yours.

I want to see both of your credit reports.

I want the login information to all of our accounts, including retirements, including checking, including savings.

Any of those accounts, I want the login information and I want them tonight.

Anyway.

because if not, tomorrow morning, I'm going to be at the bank at 9 a.m.

and I'm opening up my own account because, Sharon, he has put you and he has done this.

You're not the crazy one.

He has put you in this situation.

So you're not being the bad guy here.

You're protecting yourself.

So important.

And if you ask him,

hey,

Because of the state of our marriage, we're going to go to counseling.

What would he say to that?

If you said,

enough is enough?

We need to talk with someone.

Would he go, or would he fight that?

He would tell me we couldn't afford it.

Okay.

So how much do you make a year, Sharon?

How much are you bringing in?

I know what my salary is.

I make $105.

Okay.

I don't know what my actual take-home would be.

He's handled our taxes.

What does he bring home?

I don't know exactly.

I think it's around $60.

Okay.

Yeah.

Those are are the two ultimatums, counseling and you're and he's he's changing by morning or like Rachel said, you're going out and opening an account and

I just want you to know like you're doing well.

Like for yourself, you're doing well and you don't have to stay in a situation where someone is abusing you financially.

And I'm just going to put it at that.

It's hard to hear.

It's hard to hear.

Yeah, I know.

Yeah, Sharon, we want what we see so much is

money issues are the symptom of a lot of things going on.

And so the issue of you not knowing numbers and not having the accessibility

to see what's going on financially in your home is a symptom of having a controlling husband.

And there's only so much you can do.

You can't change him.

But what you can do is protect yourself.

And if you stay on the line, Christian's going to pick up, and I want to get you with one of our certified counselors.

You guys just spending seven minutes with you on a radio call, I feel like, is it doesn't do it justice.

I want someone walking with you, Sharon, in this because this is really important.

This is really important.

And I pray your marriage is healed in this process.

It's going to be a really hard patch, but I pray redemption of that.

I really do.

I pray that you both come to the other side and are redeemed in this.

But if not, I want you to protect yourself.

This is the Ramsey Show.

So one of the expenses that

is hard to face as adults, but it's true, there's a couple of them.

But one of them is insurance.

And in recent years, or recent months, I mean, I guess close to 18 months now, they just seem to keep going up, up, up.

Home, auto, I mean, it's just, it continues to rise.

And according to Quadrant Information Services, home insurance rates are about 23%

higher than they were last year.

Car insurance is up 39% compared to December of 2019.

Yeah, it's a lot.

And the factors that are playing into it, it's interesting.

So even if you look at like car insurance, I mean, you do have to think about where you live in the United States.

Is climate an issue?

Or do you live in a place where there's tornadoes and so there's hailstorms and it damages your vehicle?

You know, it could be something like,

I mean, wow, I just had to completely blank my brain out there.

No, but I mean, but yeah, you think about whether it's tornadoes, rain, hurricane, anything that can be damaging your future.

Yeah, climate's a thing.

And then you think about models, right?

We're doing a lot more electric vehicles.

There's more technology inside of them.

And so there's that part of it.

And so by and large, we're seeing an increased amount of car accidents, which is interesting.

Okay.

So there's that playing into it.

Some people would still say supply chain, although part of me is like, I feel like that's

caught up.

I feel like, do you remember, though, in that, in that height of COVID, you would drive by a car lot and there would be like no cars.

It was so eerie.

And now, now they're pretty full.

I would say the car lots are, there might be some cars still on back order, but I think for the most part,

yeah, you can get it if you need it.

And so, you know, a lot of people are probably like, well, what can we do about it?

And this right here, Rachel, is where what we teach really does play in because if you do buy a car in cash, you run the, if you buy it in cash, it's used, then you are qualifying yourself for a lower rate.

And so that right there is a good

motivation.

Obviously, the car model that you choose still plays a part in it.

How old you are still plays a part in it.

Like, so all of that plays a part.

So there are some ways to get around this, but even when you do all those things correctly, there is still the idea.

It is getting higher.

And that just, I mean, the truth is that that just sucks.

Yeah.

And it's one of those expenses too, that you're like, I can't do anything about it.

Right.

Like when your property tax goes up, I mean, whatever it is, you're just like, oh my gosh, I just feel, you feel stuck.

You feel trapped because you have to have it.

Yeah.

But yet it's one of those things that just continues to rise.

I mean, you could raise your deductible.

That's something that you could do.

You know, there's another thing about if you buy your car in cash and you have enough money saved up that if something were to happen to that car, you could replace it in cash.

Then you could drop off like comprehensive insurance because you're like, hey, if something happens, national, like natural disaster, something that's crazy, I have the cash that I could actually repair if I need to.

Yeah.

So there's things that you could do to save on it.

But there's just a big part of this that it is, you know.

It's frustrating.

Yeah, for sure.

Yeah.

So there's other things that you can do,

whether it's look for discounts, you can even bundle policies and then you'll get a better deal that way.

But I would, again, shop rates, because sometimes the bundles, it really is helpful.

And sometimes if you're shopping from just like one carrier and you're not comparing prices,

you may not be getting the best price.

So make sure to do your research there.

And I mean, the same thing's happening also with home insurance.

We're seeing certain states are not willing to cover things that they once did.

And again, some of this is linked to climate, some of it's linked to

natural disasters, that sort of thing.

And I mean, we had a call the other day where a lady called in.

She said, I'm being dropped from my insurance because my state has decided that they don't cover you if you have a flat roof.

And it's like, okay, great, you know.

And so all of this, at the very least, it really ties in what we teach and trying to put yourself in a position where you can have as much peace as possible.

So if these things do crop up, it's not a disaster.

It's like, okay, this is very inconvenient, but because I've set myself up, I can deal with it.

And so that's how this works.

If you want to work with an independent insurance agent, you could contact a Ramsey Trusted Insurance Pro.

The good thing about our Ramsey Trusted Insurance Pros is they are going to advise you and help you do things the way we teach.

And so that's what you're looking for.

They're not tied to any one carrier and they'll pull quotes from all companies to help you pick the best deal.

So you can go to ramseysolutions.com slash bundle to get connected and to start saving money on your insurance because it is a part of the budget it's just part of it part of the life that

all right up next we have is it Shay in Chicago hey welcome to the show hi thank you so much for having me absolutely

make this quick I'm thinking of doing a voluntary repossession of my car and I'm just wondering if that's a good idea whoever I want to call it well let me rephrase that I call it a voluntary repossession, but I'm really trying to get rid of some debt.

I'm tired of paying a car note.

I thought that was the right idea yes but can we

can we sell it that's my goal i'm hoping to try to sell it to the dealership um and i'm assuming of course can we sell it private sale

uh i'll be i'm not well i currently pay on it so i'm not sure if you can't be i guess okay so here's what i would do i would not give it back to the dealer i would not do a voluntary repossession even though that's not what you meant i would never do that because that's going to destroy your credit and just be heartache.

And I wouldn't sell it back to the dealer because they're not going to give you the best price for the vehicle.

If I were you, what kind of vehicle is it?

It is a Buick Encore GX.

Okay, what year?

2021.

Okay, I'd get on Kelly Blue Book today after you get off this call and I'd see how much can I get for this private sale?

What do you owe on it?

$22,000.

Okay.

And just your best guess, if you're like, hey, I have done a little bit of research.

What do you think you could get for it?

I'm hoping to get at least $20,000.

Okay.

So if you thought that giving it back to the dealership would give you $20,000, then I bet blue booking it, you might be able to break even on this just based off of what you've said.

Yeah, Shay, what's causing you to get rid of it?

Is it just because the payment is so high?

Yes, and honestly, I'm just trying to get out of debt.

I want to be able to pay off.

My mom and I just bought a family dupe bet, so I want to put my money into paying the bids off, not a car note.

Not a car, yeah.

Do you have any other debt?

Yes, I do have credit card debt for

$9,000.

Okay.

Anything else?

No.

How much do you make a year?

I make $73,000 a year.

Oh, good for you.

That's so great.

Okay, what's caused you to just up and say,

I want to get out of debt.

I don't want to do this anymore.

I'm just tired of living the life that I've been living.

I don't feel like I'm living like a 25-year-old.

You know, I'm making okay money and I'm not seeing the benefits from it.

Yeah.

For sure.

Well done.

I mean, that's a good why.

We usually find shea people that start saying, gosh, something's got to change.

A lot of it comes like that, to say, I work hard and I don't feel like I have anything to to show for it.

It's just this feeling of, I mean, there's nothing.

And I'm, and yeah, and you're 25 making 73,000.

That's a lot.

That's great.

Where'd the credit card debt come from?

Because you've got a good income.

Honestly, poor decisions.

And then also before I got this car, I had a card that was giving me trouble.

So I was putting some money into it to put it on my credit card, trying to get it fixed.

And it honestly, it still ended up going out on me.

So I love this.

I love when people stop and realize that they have a choice.

Like you don't have to keep going the way you've been going.

You have a, you can opt out of that lifestyle and you can go, you know what?

Yeah, I want to do better than this.

I want to feel like I'm making an impact.

I want to feel like my income matters.

I don't want to keep living like this.

So bravo.

I think so great, Shay.

Have you been, have you plugged into the Ramsey baby steps at all?

No, I have not.

Okay.

So I would encourage you to,

yeah, dive into some of the stuff.

We'll have Christian pick up and we'll give you Financial Peace University, which is our nine-week course that we always say every high schooler should have taken.

But at 25, if you can get this, Shay, because there's a process

because your emotions there, the decision in Shea has been made that I don't want to live like this anymore.

So now the best way to be effective of this and to actually see a lot of impact is to have a step-by-step process of what you do.

So, Shay, we have what's called the Ramsey baby steps, which the first thing you do is going to get a $1,000 emergency fund.

The second thing you're going to do is pay off all of your debts, smallest to largest.

So it would actually be you

you getting rid of this card, which is great, and then knocking out the credit card.

So if you have multiple credit cards, write each of those out separately, smallest amount to largest amount, regardless of the interest rates.

Pay minimum payments on everything and pay off that smallest credit card first and work your way up.

I would be getting a side hustle.

I mean, I would do anything I could to knock this out.

And again, you make some great money.

So even limiting your lifestyle, living on a budget, doing a couple of those things is going to help you.

And then your next goal, Shay, will be to get a fully funded funded emergency fund of three to six months of expenses saved in the bank.

Okay.

And what, I mean, could you, how would that feel right now?

If you had no debt and you had five months of expenses saved in the bank, how would that feel?

Amazing.

Amazing.

So good.

Okay, stay on the line.

Christian will pick up and we'll give you some stuff to help you on your journey.

I'm so glad that you, that you called in.

I know.

So great.

Okay, those of you that are watching on YouTube or listening on podcasts, make sure to download the Ramsey Network app.

We'll have the third hour there.

If you're listening on radio, keep listening, and we will be here in the next hour.

Thanks to all the guys in the booth.

Thank you, Jade, for a great hour.

And thank you, America.

This is the Ramsey Show.