Don’t Try To Solve an Income Problem With More Debt

from the Ramsey network it's the Ramsey show I'm Jade Warshaw next to me is Dr. John Deloney we're going to be taking calls about your life your money your relationships uh you guys already know this but Dr.
John is the resident relationship. Can I call you a guru? You can call me anything you want to.
The guru would be the nicest thing to call me today. I'll go with guru.
And I'll hit you up on the money side and we'll cross paths as needed. If you want to get involved, this is a live show.
So you can call in right now. 888-825-5225 gets you on the line.
All right. We got Eric from Seattle, Washington starting us off.
What's going on? Big E. Hi, guys.
Thank you guys so much for having me. You're welcome.
How can we help? I'm a little bit nervous. So I'm currently a small business owner and I'm looking for your advice on what to do legally, morally and ethically.
So I started a business two years ago with a good friend of mine. Well, just knew him professionally.
And after one year, he called me out of the blue and told me that he has cancer. And I felt really bad.
And we decided to, you know, kind of close up, you know, our business. At that time, we had about $16,000 of outstanding balance that we owed in various debts.
At that point, I just messaged him once to see, you know, if he's okay with covering his share. He didn't respond.
So I didn't want to press him because, you know, you know, he has cancer. So I just paid the 16,000 from my own pocket and we closed the business.
It's been about two years now. I've been trying of just calling him, just not even mentioning money.
He's like, hey, are you okay? How's it like, is everything okay? He hasn't answered me, doesn't reply. I was wondering what you guys would do, like, you know, legally, morally and ethically.
Should I just let it go? Should I try to pursue it? Yeah. So do you feel like he's ducking you because he thinks that you're going to ask about this money? What do you think? You know the guy and you know what your relationship was like before this.
Or is it that he's quite sick and he's kind of off the radar? I mean, knowing him, he's a little bit I feel like it can be both. Really, my gut tells me that, you know, he's actually sick, but I feel like he can at least answer a text or a call in, you know, three years.
I mean, you guys were friends, right? And I'm not even mentioning about the money. You were friends? We weren't, like, friends.
We just knew each other, like, professionally from, like, previous work. We worked at the same place, and yeah.
I mean, what was it like when you guys closed the business? What did that look like? Because I can't imagine running a business with somebody that I'm not in direct contact with on a daily basis. I mean, you're doing everything together.
So what happened? Something happened that caused you guys to kind of, we don't talk much anymore. Something had to have happened.
Am I wrong? Yeah, well, so we were just planning for our next stages of expansion. He was in charge of, you know, like tracking down new clients and trying to expand us.
And he just called me like one day and says, hey, like, well, he hasn't been picking up my phone lately. And, you know, he finally got back to me after a week and he told me that, hey, I'm currently dealing with some health issues.
And I was like, what happens? I currently have cancer. And I know he's a single dad.
So, you know, I just wish them all the best.. And then on the same call, we're like, okay, well like, you know, let's close up the business then.
Cause I want you to focus on this and I can't carry this on without you. Um, so the next step was we called our accountant and, you know, we term, we submitted the, you know, the notice of termination, we got his signature.
Um, and you know, then, you know, our accountant sent us the bill as well. And, you you know after that you know you know you don't really hear back from him here's here's my thoughts dude like on any front like let's say he's a total scumbag and he's just playing you right to run a two or three year i've got cancer i'm a single dad ruse dude i want nothing to do with that human being let's say he does have cancer maybe he's in remission he's working really hard it scared him to death he's just trying to keep one foot in front of the other um or i just go back to the emotional and spiritual calories you have burnt over the last

two years for eight thousand dollars which is a lot of money yeah i don't i don't want to minimize it but bro i i mean if i'm in your seat i'm i'm brushing my shoulders off i'm going on about my life interesting john interesting because either you're gonna sue a guy that told you he's got cancer right yeah i don't think you have to go to that i mean can i just ask have you i know that you're saying hey i'm contacting him and i'm contacting him under the guise of like seeing how he is but have you just actually said hey i don't know if you realize this but when we close the business there were 16 000 i just paid it but are you know truthfully we went into this together um because there's business is business this is not your brother this is not your uncle like it's not your dad like business is business and so there's part of it that i would be like hey um i would love for you to pay your half because i came out of pocket on this and 16 000 is a lot of money and then maybe he does say bro i'd love to pay you but here's what's going on like i don't feel like there's anything wrong with opening up that conversation there's nothing wrong with it okay but what let me let me put it this way what you're doing is not working yes so either you're you're a true friend and your buddy's dying of cancer your buddy your your former business partner buddy and and you go knock on the door and you say hey man i miss you you're not returning my calls are you all right um or you let this thing go but you just like lobbying a text every once in a while or lobbying a voicemail it's just not it's it's making you crazy and if there is a hurting person on the other end of this phone uh on the other end of that line, it's not working. It's not getting through to them.
Okay. So you recommend just visiting him in person or just forgetting about it? I mean, Jade and I, I think she's exactly right.
Business is business. And so if you want to go track down your $8,000, the way you're trying to track it down isn't working.
So either knock on his door or send a letter from a lawyer. That's really your two options.
Or you've tried for two years or two and a half years. You either he's a scam artist or he's just struggling, man.
And either way, he doesn't he's communicating to you through his behavior. He don't want to talk to you.
So let it ride. Yeah.
For me, you've said nothing about this guy that denotes, man, I had a great relationship with him and I really want to keep that together. Like, there's been nothing of like, we used to be best friends or good buddies.
At least you haven't said that in this conversation. So in many ways, it's like, if you kind of press this, there's not, it doesn't feel like there's much loss if you press this and he kind of gets, you know, he starts feeling some type of way about it, right? It's not like it were your dad or if this were your best buddy.
Am I right, or is there more that you didn't tell us? Oh, yeah, you're completely right. You're completely right.
Yeah, I'd press it. The truth is, if somebody says, I don't, I'm not going to give you this money, yeah, you're not going to get it without some sort of a legal situation going on there.
And you get to decide that. But I'm with John, man.
I'd press him. I'd find out where he works or I'd find out where he lives and I'd pay him a visit.
I'd be like, hey, man, what's going on? You just dropped off the face of the earth and check in with them first. But then it's like, hey, let's talk about this $8,000 because that's not a little bit of money.
Most people feel that greatly. So thanks for the call.
Are you struggling right now financially?

No, no.

I mean, $8,000 is a lot of money, but it's not like it's going to kill me or I'm going to be homeless or anything.

I have about some savings.

Okay.

Do you want to be friends with this dude?

Are you genuinely worried about him or are you reaching out just to get your money back?

At this point, I think it's more about the latter than the former because it's just giving me a little more like my suspicion is just growing more and more um just because it's been you know about two years and i just even haven't heard from it back like hey is he alive okay or you know that's what i'm wondering is he with us i i have no idea yeah so you're you're creating stories that are keeping you up at night, not him. So I would say act.
Either make it a point in your spirit just to let this thing go. Go get in a car and go visit him or go contact a lawyer and have a lawyer write a letter.
But those are the three direct things. You can drop it.
You can friend it or you can make it a legal action. But you just sit around spinning up stories about what he may or may not be doing.
That's making you crazy on the inside. It's not worth it.
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It's The Ramsey Show. I'm Jade.
Next to me is Dr. John Deloney.
Happy Halloween, if you celebrate that sort of thing. Are you a spooky Halloween?

Like creepy Halloween?

I like scary movies.

I like haunted houses.

And I love eating my body weight in candy.

And having everyone not like look at me like I've got something wrong with me.

You're like I want to have a normal night without everybody looking at me like I'm crazy.

Yeah.

I mean you can just mainline candy and everyone's like yeah it's Halloween.

So I feel like I get a pass. But also I like going to bed like at nine o'clock.
So this is a tough night for me. Yeah, I hear that.
Are you like a chocolate or like a candy, like hard candy person? I'm not super discerning. Okay.
I'm not super discerning. I always get frustrated with the Jolly Ranger folks, but other than the Jolly Ranger people.
And I got a stiff dad tax. I'm trying to teach my kids about the future of the world they're going to be inheriting with high, high taxes.
And so when they get home with the candy, I go through it and dad tax it pretty hard. Got you, got you, got you.
Pretty hard. Listen, I always say payday is very underrated.
I get sad every Halloween. There's less and less paydays that are given out as candy.
I know. And that's one of my favorites.
Kids like mine ruined it. Yeah.
There's less and less butterfingers going out. That bothers me deeply.
With all of my heart, yes. Kelly knows what I'm talking about.
All right. Well, because I talked a lot.
I used to make fun of everybody when I was a kid. And that's why the universe gave me a peanut allergy kid.
They're like, oh, that's what you get, Delaney. So it's kids like mine that are ruining it for everybody.
I got you. I didn't make that connection.

Now I know.

There should be.

Oh, my gosh.

If there was an adults-only peanut candy party.

Let's move on.

I realized I just wandered into some fragile territory there.

That's not what I meant.

I was just saying.

There was a bunch of people that got together,

and they were like, hey, let's all bring paydays and Butterfingers.

It would have been awesome. It would be awesome, John.
All right, let's go out to Mobile, Alabama and they were like hey let's all bring paydays and butterfingers it would be awesome it would be awesome i just got to mobile alabama and talked to michael what's up michael hey how's it going that was a little bit weird with the adult party it was all weird that makes perfect sense i'm glad you called it out michael uh we're sorry what's up what's up nothing around how are y'all doing? Good, good, good. What's up, dude? Yeah, so I was actually calling.
I live paycheck to paycheck, man. I make like right under 40 grand a year.
My wife doesn't work. She stays at home with the kids.
I've cut costs, I mean, as much as possible, and we're still just not really saving any money. Like, I just feel like I'm beating my head against the wall, and I'm trying to get us into a house and things like

that. But my main question is, what is the best way for somebody like me? I have no retirement.

I have no savings. I have nothing for the future.
I'm 32.

You got to make more money, brother. Like, you're not making 40 grand.
What do you do for a living? Um, I'm a, I'm a cemetery maintenance manager. Okay.
Um, and you know, work 40 hours a week or whatever, but I started my own business this year, uh, landscaping and stuff. What's that bringing in? It's gone.
It's gone pretty well. I've brought in right at like 18,000 this first year.
Okay. But I've also spent every single dollar getting new, better equipment, just, you know, stuff like that.
So you invested it all back in. You didn't.
Yeah. And next year, I'm actually in a good spot to, I think, actually make a profit.
But I haven't paid myself out of that business.

And I feel like I'm just killing myself trying to juggle everything and then not getting anywhere on top.

Well, let me bust in here.

Tell me a little bit more about your financial snapshot because we know that you're making the $40,000.

I'm not going to lie to you. It's going to be tough to, to, to make your way with that.
Um, and then you started the side hustle, but you're reinvesting all the profit, which in this case, if it's a side hustle, pay yourself and grow the business later. Right now you need cash.
So let's find out about the debt. Do you have any debt going on? Is that robbing you? Well, so the past year and a half that I've been here, I've focused on paying all my credit cards down.
I have like practically no credit card debt. How much? $150, you know, and the main things I have are mine and my wife's vehicles.
Okay, tell me what they're worth and what you owe on them. What they're worth is, and what you owe on them.
I mean, mean probably collectively 20 000 together and i owe probably collectively 30 on both of them tell me individually tell me what you owe on it and tell me what 21 interest rate um and i'm actually refine i'm in the process of refinancing it right now um but it's really all i could get

at the time and so i took it uh the truck i bought it for 15 000 okay at 40 41 exactly yes yes okay and what what's it worth you bought it for 15 000 what's it worth now if you were to Kelly Blue Bucket private sale?

It'd probably be about $9,000 or $10,000. Yikes.
Okay. And what's your payment on it? My payment is $445 a month.
Sheesh. Okay.
Now tell me a little bit about your wife's car because I'm going to try to find you a way out of some of these payments, because these are what are, you can't breathe, you know. So tell me about your wife's car.
She has a Tahoe. It's a 2013.
We got it for $25,000 a couple years ago. Golly, dude.
Hey, what's going on here is your cars are almost what you make in a year. Trust me, I know.
Yeah, that's a problem. I mean, it takes literally, I can buy weekly and it takes one of my checks to pay both of the vehicles and most of insurance.
Okay, so now that you feel that, then I don't need buy-in going forward. We know we've got to get rid of one or both of these vehicles, some way or somehow.
So you paid $25,000 for hers. What's hers worth if you were to sell it? Not trade-in.
Probably $12,000. What's going on? I'm sorry, go ahead.
Why are you going into these subprime loans? Why are you paying 41% interest in doing all this? What's the, what does it get you? On the Tahoe, we got like an 8% interest rate. I got a pretty good interest rate on there.
The thing, it's just, it was so, it was just older, but a real, like an 80 year year old woman had it had like 60,000 miles on it it's still going great yeah but here's here's where I want to get you to here's where I want to get you to um I want to get you to the point where you look at these vehicles and you go this was the worst decision this is getting me nothing as long as you look at it and go oh well it was kind or I needed this or that. There's not going to be much I can do to help you.
You have to look at this and go, that was the dumbest thing I ever did. I'm never doing it again.
That's how we know there's a turning point that's going to happen. And I hope you get to that point because truly something's behind this for you to make $40,000 a year and have almost $40,000 in vehicles.
I mean, you're shooting yourself in the foot at that point. So to John's point.
Can I say it, Michael, I think I know what it is. You don't make any money, but y'all are living a life that you want to be living.
And what I mean by that is, bro, you can't afford for your wife to stay home right now. Y'all don't make that kind of money.
And I know you want that, and I want it for you, but you can't afford it. I have three kids as well, and that's the main reason.
That's an even more reason. I totally get it, dude.
But you got cars that are nice, and they may be old or whatever, but that you can't afford. It's like this.
I want to have a Tahoe. I want to have this nice truck.

I want to,

we're going to be a stay at home,

single income family.

All of that works good on paper

and it looks good on Instagram.

It doesn't look good in reality.

How old are your kids, man?

13, 10, 2,

and my wife's pregnant right now

with another one.

Okay.

So you have two that are in school and you have a two-year-old right yes all right is she homeschooling also uh no no the the girls are in school and she she stays at home with my youngest and like i said she's she's seven months pregnant now okay um so she hasn't been working for i guess it's been the past two years she took off for my youngest let me ask you we're going to run out of time here I just need to say this out loud bro you got to look yourself in the mirror and I want you to like there's nobility in the job that you do there's nobility in starting a side hustle you've got to go make more money you've got a family of five and another one on the way. You've got to get rid of these cars, right? You've got to figure out these car loans and stop doing what quote unquote looks fine.
You've got to go scorched earth with cars, no debt. Hang on the line.
We're going to give you FPU as our gift. I want you to watch those videos.
And Ken Coleman's career assessment because your core income is an issue. No side hustle is going to help you get out of this.
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You're listening to The Ramsey Show. I'm Jade Warshaw.

Next to me is the doctor, Dr. John Deloney.

I'm really excited because the time is running out yet again to book your cruise, John. I've told you many times if you don't book it, you got to book it now.
They're more than 90% full. And so if you were thinking about going on this cruise, now's the last chance.
And there's no guarantee that you'll have another chance. So you better book it.
Yeah, it's going to go as a Christmas gift. And don't forget the Ken Coleman Pickleball Challenge and the George Camel Cannonball in the Pool Challenge.
He's taking on all comers if you want to go see that. Interesting.
Okay. Speedo required.
Speedo required. That's George's personal request.
That's right. That's right.
Well, I do need to say we're talking about all of these fun amenities, but it's not your average cruise. This is actually a very premium cruise.
Holland America is top draw,

if you will, John.

It's a nice cruise.

And we're going to really nice destinations.

I've cruised a zillion times.

I've been to all these places.

They're actually really, really great.

Turks and Caicos, Puerto Rico,

St. Thomas, Bahamas, and more.

Holland America's Neustadt and Domship

is beautiful.

The way the theater is, John,

it's like around.

And all the way around, 360 basically are LEDs. And so it's a very immersive experience.
So it'll be really, really fun. Really great food, really great entertainment.
There's specialty restaurants on board. There are excursions that you can do.
The food's all included, right? Everything's included. Room service is included.
Everything's included. Man, you can have a hot dog at 3 a.m and no one's going to stop you and will they bring you uh they bring you indigestion and anti-diarrhea that you might have to provide on your own but all the ramsey personalities are going to be there and i keep saying by the end of this it's a seven day cruise by the end of this we're going to be bffs forever we're going to be nffs we're going to be no forever friends i think we'll be bff i think we will too as long as nobody wears a speedo, we're going to be BFFs forever.
Or we're going to be NFFs. We're going to be no forever friends.
I think we'll be BFFs. I think we will too, as long as nobody wears a Speedo.
But there's going to be lots of celebrity guests. It's just going to be great.
So book your cruise. RamseySolutions.com slash cruise is how you do it.
Or you can click the link in the description if you're listening on YouTube or podcast. All right, I'll see you there.
Let's go to the phone lines, shall we? Wichita, Kansas. We've got Drew.
What's going on, Drew? Hey, I appreciate you guys taking my call. It's a little embarrassing of a phone call, but here we are.
My wife and I bought a car two years ago, and we are absolutely upside down in this thing. Kelly Blue Book, I can trade it for $3,000.
I could probably do a private sell of $5,500 to $6,000. Okay.
And we owe just about $14,000 on the car. Whoa.
We are trying to figure out, do we just let this thing get repossessed and deal with the money that we're going to have to pay later on to free up that five six hundred dollars today or do we keep it no i would not do a voluntary repossession that is going to drop an atom bomb on your credit which is unnecessary and you're still going to be on the hook for it it's it's it's not i would not make that option what's the what's the payment on this for you? What's it costing you? $450 a month. Okay, that's a lot.
Tell us about your income. So my wife and I stepped down from ministry, just obeying Holy Spirit and rest.
And I am currently driving a semi-t So I'm gone a lot. What do you make? Right now I'm sitting at about $40,000 to $50,000 a year.
Okay. $40,000 to $50,000 a year.
What are you taking home? What's it look like monthly after taxes, after all your expenses are taken out? What's it look like that you're bringing home in your check every month? It just depends on miles. Obviously, we're looking probably two to sometimes $4,000 a month.
Okay, two to $4,000. And is your wife doing anything during this time? No, she is a stay-at-home mom.
She's actually, we're having a baby tomorrow wow okay and it's this going to be

your first child or how many do you have number three wow okay you know what this this in many ways this call is very similar to one we took earlier this hour um regarding the car you're probably going to have to bite the bullet and pay this thing off is it your only debt? We have a credit card of like a thousand dollars and then we have student loans, which are probably about 20 and that's all the debt that we have. Okay.
Because here's the thing. If I said, hey, go to the credit union and get a loan for the difference, but then also keep some money out to buy yourself a cash car, you'd be right back at $14,000, right? And so there's really no way getting out of it.
The only difference is you might have a slightly lower payment every month, but not by much, okay? So for that reason, I would say you're going to have to bite the bullet and how quickly can you pay off $14,000? That really needs to be the goal. This could be a lot worse.
You know, John, we're not talking about a $45,000 situation. This is a $14,000 car plus a $1,000 credit card.
If you both decided it's, and I'm not saying this to be ugly, but it's adult go time and we've got to work and we got to bring in an income, then you can clean this mess up

very, very quickly. But the problem is making two to $3,000 a month, it ain't happening.
Yeah. I hesitate to get into this, but when you say the Holy Spirit told you to stop working at the church, what does that mean? Did something happen? Did y'all get in trouble? Or did you just say my time here is done?

It was a little bit of church hurt with it.

I'll be honest there.

But we definitely needed rest.

My wife has had some health issues through this pregnancy.

We just needed to focus on us and our kids.

That way, later on in life, they did not, you know, hate the church and hate being a follower of Christ. If I can be honest, just listening to your voice, you sound terrified.
A little bit, yeah. Okay.
You've got a pretty brittle tenor. You've got a baby coming tomorrow.
You have a job that is putting you on the road all the time. You're not home.
Your wife's not doing well. you've got a pretty brittle tenor.
You've got a baby coming tomorrow. You have a job that is putting you on the road all the time.

You're not home.

Your wife's not doing well.

You've still got, there's,

my dad was a minister for a while too.

There's a hurt like no other when your church family turns on you, right?

I think you're worth more than $40,000

in your current area, okay?

And I applaud you for going to do the next thing you could do to get a

paycheck to take care of your family.

That's noble and that's good.

But if I were you,

I'd go down and see if what would,

what I could make being an assistant manager at Walmart or stocking or

something like that.

Cause you need to be around your family when you have this other kid.

And if your wife says has had health issues,

I know that's weighing on you.

Um,

and I want you to make more than 40,000 bucks. Yeah.
Okay? It's a scary moment right now. Does that sound tenable? Every trucker I know is struggling right now.
It's just a reality. It made a jillion dollars three years ago and people are gnawing off their arms and legs to try to make it work right now.
And so I'd rather see you walk away from that and go work at McDonald's and make 11 bucks an hour and go from there and then go

down the street and throw boxes at Walmart until 11 o'clock at night and do the night feeding so

your wife can go to bed. I'd rather y'all figure that out the next six months.
And even if you're

only making 40 or 50 grand doing that until you cobble something else together. But man, oh man,

oh man, I can hear it in you, dude. I mean, the truth is when you really put math to this, if you just say to yourself, okay, let's take it $1,000 at a time.
I need to make $1,000 more. If I can make $1,000 more a month, for the most part, I can have this car paid off, right? I mean, that's what we're whittling it down to.
And if you do that, you're out of this car. And, you know, you do a little bit more than that, you're out of the car and you're out of the credit card, right? And then the next year you start tackling the student loan.

And so just by breaking this down into bite-sized pieces, because again, similar to the call we took earlier, this is a core income issue. I don't know if your plans are to go back into ministry or not, but whatever your plan is career-wise, it has to shift from where it is right now.
And I'm not going to sit here and act like that's a light switch. I think that that's more of a journey that you're going to be going on.
But in the meantime, do what John said and take the jobs that you can get because a lot of them are paying a lot more than what you're making right now. And you miss your family, don't you? Absolutely.
Yeah. If you were making $140,000 a year

and this was a season,

I'd give you a hug and say,

man, this is a season.

You're making $40,000.

It's not worth missing everybody

and your family and your life

and watching your little baby

be born without you to do that.

Not when there's $40,000 worth of jobs

down the street, if not more.

And you can get on an assistant manager

and associate manager track and then go make yourself some good money down the road, if not more. And you can get on an assistant manager and associate manager track

and then go make yourself some good money down the road here.

I'm proud of you, man. Let's reverse engineer this thing, and congratulations on having a new baby.
And Jay and I will be cheering you guys on that you guys have a healthy birth and everything's good to go this time tomorrow. Blessings, man.
This is The Ramsey Show. statistics show that half of Americans don't have enough life insurance or they don't have any at all.
I don't understand this, John. Why don't people want to take care of their family? They think they're not going to die or something? Well, I used to be one of those guys.
I didn't even think about it. And one of my buddies said, Hey, the only reason to not have life insurance is if you hate your wife and kids.
And I immediately went and got term life insurance. That's a gut punch.
For decades, Dave, I've sat across people who've lost a spouse. They've lost somebody important to them.
Me too. They don't know what to do next.
You're going to have a crisis here. You know, you got two options while you're sitting and talking to a young widow.
She's concerned about how she's going to invest all this money properly and not mess this up. Or she's concerned how she's going to eat tomorrow.
These are the two options. It's saying I love you to your family.
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Go to Zander.com or call 800-356-4282. You're listening to The Ramsey Show, where we help people build wealth, do work they love, and create amazing relationships.
I'm Jade Warshaw. Next to me is Dr.
John Deloney. Today's Ramsey Show Question of the Day is sponsored by Why Refi.
Hey, it's hard to make progress when you're trapped under an avalanche of defaulted private student loan debt. But Y-Refi helps you dig out and get momentum with custom refinancing based on your ability to pay.
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Today's question comes from Isaac in Arizona. At my current job, I was given the option to take a voluntary severance package, which I accepted.
I'll be leaving at the end of the year with roughly $150,000 before taxes. My wife and I have a $175,000 mortgage, five grand in credit card debt, and we owe 40 grand on two cars.
I'm already job hunting, but I don't have anything lined up yet. And given the current bloodbath in the tech industry, pause.
Hey, you know what we should do? Let's make a bunch of things that make our jobs obsolete. Yeah, that sounds great.
I'm praying for the best, but planning for the worst. Assuming I'm still jobless in a couple of months, would it be better to leave the money alone until I find a job and pay myself every two weeks

for living expenses or go ahead and work the baby steps

regardless of my job situation?

All right, so off the top of my head,

you tell me if I'm wrong here.

Okay.

I don't feel like Isaac's taking this seriously enough.

And what I mean by that is you have no job

and you're looking on the horizon and the prospects for the, i'm assuming he works in tech the prospects are going away okay um and so this is a sell cars this is a scorched earth we're going to live like as though we just lost our job because we did and yes i guess i don't think you pay yourself a salary for living expenses but you cover your living expenses with the seven that's what a severance is for right to pay for the fact that you don't have a job yeah uh i think that you're half right okay and mostly right um this is a storm mode situation so my goal would be to not touch this 150 he listed out and there might be some information list missing here he told us how much debt has, but he didn't allude to the fact that he had any other savings laying around, which makes me think, okay, now's not the time to take this money and pay off a bunch of debt. Now's not the time to be walking the baby steps.
Now's the time to pause and go, okay, this money's sitting there in case I need it, but let's make sure we don't need it. And get up at six o'clock in the morning, go to the grocery store, start working.
Yes. Start bagging groceries, dude.
You don't have any money. Otherwise, you're going to look at this and it could be a false sense of security and it could cause you to kind of like sit back on your haunches a little bit, wait for the perfect job to roll up as opposed to no, I'm going to act like this money doesn't exist.
I'm going to go get it. And, you know, it might take a while, but I've said this to ken and this is just my thought when you're unemployed take any job until you can get any and all jobs multiple and when they say like i'm searching how long does that actually take yeah like an hour two hours of course you can take time off if you get an interview right right right but you're shooting emails you're you might be having coffee every once with somebody.
You're making phone calls and texts. Go work and then work on top of that and then work on top of that.
You're unemployed. You have no job.
Yeah, because the last thing you want is to feel like the longer you go without a job, the less your self-esteem is there. That's exactly right.
And it just, you bring that into the interview. Yes.
And you, this sounds so lame, but this is how it works, you guys. I'm sitting here because I gave a talk at a university and one of the executives here was dropping her daughter off.
Show up in other places. That's right.
And it might be that you're bagging groceries and somebody that you used to work with who also took this bath and found a new job is like, bro, what are you doing? You're like, dude, I'm taking care of my family. And they'd be like, I got you.
So go be seen. Go bag groceries.
Go drive. Go get out and take any kind of job you can get kind of job.
I might, if I have $150 before taxes and you'd probably take home $100,000, $110,000 or whatever that would be, I might pay off this $5,000 credit card. I mean, maybe clear that if that's all the debt you have and i'd probably try to sell one of these cars um because 40 000 bucks total in cars is going to be what a thousand bucks a month oh yeah he could get he could definitely get out of those cars um definitely and i'm not mad if you paid off the 5 000 but you definitely don't have to yet um but listen i'm with john go work and then go work and on top of that go more.
And go do things that cause you to form relationships with people because that's where the opportunities are in the relationships. Yes.
All right. We got Brandon.
He's in Grand Rapids, Michigan. What's going on, Brandon? Hey, thanks for taking the call.
I appreciate it. You're welcome.
How can we help? I have $140,000 in student loan debt and a house payment, a house mortgage of $75,000. My wife and I just started on the Ramsey program.
We're trying our best. I think there's a lot of fear that the balance is really big.
Welcome to the call, Brandon. You're in good hands, man.
You're in good hands. I started having panic attacks, different things.
I picked up a second job. So working full-time plus a second job, just trying to figure out how to get them out and taken care of.
Okay. As quick as I can.
Are they private? That's the only debt we have. Are they private? They're fed? Okay.
I'm still paying on them because they're in the forbearance right now, so I'm still making payments on them. I've knocked about actually about $10,000 off already.
That's great. On my student loans.
Good for you. What's the monthly payment combined? My monthly payment on the IDR is $182, but I'm putting about like $300 to $400 on it.
I think you're doing everything right as far as these student loans are concerned. You've utilized a payment plan to make sure the minimum payment is as low as possible, and that allows you to free up all of that extra money to throw out the smallest student loan.
So is it all one lump lump thing or are they individual loans? So I have one that's consolidated for like 101,000 and some change, and then individual ones that make up the rest of that total. Okay.
And you're throwing all the extra money at just the smallest one, right? You're calling it in or you're going on there to make that principal payment? I can, on the services website dictate where the money goes. You're doing that exactly right.
I wish there was an easy button that I could hit for you. The only thing that's going to make this, I know, and I wish it was.
The only thing that makes this go faster is you making a bigger shovel. But even that, I mean, there's going to be a time aspect to this.
But tell us about the panic attacks. Yeah, I think, Dr.
John, I've read your book, and I think the panic attacks are my body doing what it's supposed to, as uncomfortable as it is. I was going to say, I wonder if your body's telling you the truth, right? Yeah.
They started years ago when I tried to just shove the debt thing aside and forget about it. I mean, I never did not.
I was always making payments. I never shoved it aside at that point.
But it was always something like, oh, I'll just pay it for the 20 or 25 years and be done with it. And then it just kept building, and my body was like, which is always waiting for the other shoe to drop.
And it, it didn't, my body was like, no, we're not going to wait for the other shoe to drop. Good for you, man.
What do you do for a living, dude? So I work, believe it or not, with panic attacks. I work in community mental health.
Okay. So I'm a community-based mental health worker.
What's your, What's your schedule look like? I work about 7 a.m. to 4 30 p.m.
I'm a salaried employee. There might be times where I might have to work a little bit on weekends, but I try and protect that time as best I can.
So can I tell you, can I tell you something and you're not going to want to hear it, but this is me just trying to help. Okay.
Yeah. Um, I did a lot of my internships at a community mental health program and there's some of the most amazing people in the world.
And I've got a big heart for those programs. They also, they, they hire people who are service oriented, who are in this for something other than the money.
And I love that. But you can't afford to be doing this right now.
When on the other, on the other shoe, you could go do private practice and take 120 bucks of cash and get your loans paid off. Okay.
And so it might be a season where you go see what that would look like. And I'd probably dip my toes into it and say on Saturdays, I'm going to do private clients on my own.
Do they, would Would they allow you to do that or have you signed your life away? I have not signed my life away. I would be allowed to do that.
Okay. I would recommend you start going to see clients on Saturdays.
All day Saturdays at $100 an hour do cash or $120 an hour do cash and begin to build a client list. And if in two months and three months, if you're like a lot of good therapists in town, you'll fill up real, real, real fast.
And you can get up to 100 grand or

150 grand in cash just cooking and then go back to community mental health when your family is

in a more secure place. You just can't afford to be making 60 grand with that kind of debt right

now. That's awesome.
And there's like little to no overhead on that. Amazing.
All right. That does

it for this hour of the show. Thanks, John, for hosting with me.
Thank you to the line we got smooth jazz It was spooky the way I said that. All right.
If you want to get involved, call the number. And who's back there?

Christian?

I can't see it.

We'll pick you up and get you on the line.

We got Vince.

Smooth jazz, Christian.

I like smooth jazz.

He answers the phone.

Oh, yeah.

Is that what you get?

He's got the best phone answering voice on the planet.

Interesting.

I've never heard that voice, Christian.

Whenever I see you in the hall, it's like, hey, Jade, what's up?

No, when he answers the phone, he's like laid back.

Okay, good to know. I got Vince.
He's in indianapolis indiana what's going on vince hi guys thanks for taking my call you bet so i'm currently working through the baby steps right now but my question isn't about me it's for my parents how do i get them to be gazelle intense and, you know, start budgeting, working through the baby steps? You know, what can I do to get them on board? Listen, when you find out, tell me. Bro, write that book, you'll make a billion dollars.
And hey, your second book will be how to teach my parents about sex. Oh, man.
The two things that no parent wants to hear from their kid about is get lectured on is money and sex. So tell me what is happening that has landed you here.
Yeah. So, I mean, I just sat down with them earlier this week just to kind of get a financial picture for them and, you know, what their retirement is going to look like.
They're both 53 right now so they got another 10 years or so uh before they retire um if they can afford it right exactly uh they've got about 100 grand in debt um 100 grand on a mortgage and to my knowledge i'd say they probably have around $800,000 in retirement. Okay, and what do they make? My dad told me that they're around the $200,000 mark, which is, you know, a lot of money.
Yeah, they're doing great. They're doing good.
I mean, the truth is this lump sum, a lump sum is going to double every seven years, so this $800,000 at some point is going to be $1.6,000, and on down line, it'll double again. They have a house? Yes, they do.
They have about 350 in it and they said they can sell it for 450. So your parents, for all intents and purposes, your dad and mom are millionaires, right? Almost, I think.
Yeah. I think if you tacked on the debt, it'd be just shy of it of it okay but obviously you know that's got to last them 20 years in retirement or did you call did you call the financial picture meeting or did your mom or dad call it uh you know I'd kind of called it just to to make sure that you know they're going to be okay okay good for you for having the courage to do that and good on them for sitting down and walking you through where they are.
Most parents wouldn't do that. So that's a pretty cool situation you found yourself in.
Good for you. Here's the truth.
In 20, 21 years, they're going to have $6.4 million doing nothing different. And they're in their 50s, so that puts them in their 70s.
They're what I would call normal in that way of, hey, they're clearly putting aside in their retirement, but they're also carrying debt, right? That's kind of the normal American way. To their point, and to their credit, at least they've continued to save in retirement.
And so I'm with you. Yeah, I want them to pay off the $100,000 of debt.
I want them to be mortgage free before they retire. I don't know that you will be able to convince them to do that.
I like that you're thinking about that. But either way, what I thought you were going to call and say is if my parents don't get their life together, I'm going to be on the hook for taking care of them.
But I don't think you're going to be. Because I think they're going to have plenty of money to be able to float what they're doing.
It could be more peaceful, to your point. But I think they're going to be okay because they'll be able to live off the interest that this floats off.
John, what can you do? Here's what I'm going to do for you, Vince. We're going to give you a copy.
We're going to give you a, I think it's a digital link here to Financial Peace University. Okay? And it's all nine lessons.
I'm going to hook you up with it. And I want you to share that with your parents.
And all you have to do is say, hey, dad, mom, it really means a lot to me that y'all sat down and walked me through the finances here.

Most moms and dads won't do that

or they can't do that

because they don't even have their house in order even know.

Thank y'all for doing that.

This is something that's meant a lot to me.

It would mean a lot to me if y'all listen to this,

if y'all watch these videos.

That's it.

And if your dad wants to ask you questions, cool.

He's probably not.

He's, like I say, he's got a million dollars.

He's probably feeling pretty good. Yeah.
And so he's probably got a plan, and that plan's different than yours. We're going to love him anyway.
And what we're going to do is we're going to live consistently, and we are going to reverberate peace. We're going to eat anxiety at the dinner table, at, at Christmas.
And eventually your family members will ask, Hey, can we go for a walk? Tell me about what you're doing. Okay.
But we'll give it to you and you can give it a shot, but I think it's done fully respectfully and with gratitude for the, the, the transparency, which with which they met with you earlier. But don't get your feelings hurt if they say no.
And I want you just to keep living the values and principles that you believe in. It's good for you.
Yeah, thank you for the call. That's tough.
I mean, what I thought he was gonna say was what he ended up saying was a lot better because so many times we get the call where it's like, listen, my parents have misbehaved with money. I'm in my 40s.
I've got my own kids. I've got my own kids who are going to college and they're hitting the age where it's like it will all hit the fan at the same time.
Right. Right.
When my kids are going to college is right about the time that my parents are going to be going to Social Security age. Social Security is not going to be enough.
They're going to be hitting me up for funds. Right.
And when you see that oncoming train, you want to have that talk with your parents to say, hey, let's talk because I don't want to be on the hook for this. I can't afford to be on the hook for this.
But then to your point, John, you have to deal with the fact that they're not having it a lot of times. They're thinking this is my life.
I don't have to tell you what I'm doing with my money. Who are you to tell me what? That is a very difficult situation.
And parents, if you're listening, please don't do that because it's in many ways it's not that they're trying to control you it's not that they're trying to tell you what to do they're trying to get themselves in order that's right that's right and and i think i think any in 30 30 or 4 year old person who's got any sort of thinking about tomorrow in their, in their mind and spirit is thinking about,

am I going to have to take care of my parent?

Yeah.

I wonder what that's like.

Are they going to have to move in?

Yeah.

Like you mentioned,

I mean,

we're going to hit college right when they're hitting their late seventies. And,

and I'm hearing more and more Jade,

um,

that this,

the boomer generation owns a big chunk of the real estate with a ton of

equity in these homes.

That's right.

But they're saying,

I'm not moving.

This is my house.

And why would they?

The interest rate,

I mean,

but,

but,

but it's like,

Oh,

your nest egg's in this house.

Yeah.

Like,

yeah,

I ain't moving though.

Like what?

See you next time. of equity in these homes that's right but they're saying i'm not moving this my house and why would they the interest i mean but but but it's like oh your nest eggs in this house yeah like yeah i'm moving though like what are you gonna help out with groceries you're gonna have and it's like no no that's why we have this you're gonna sell it i'm moving well and then the painful part of that is it's and forgive me if this sounds any sort of way but it's like if all the equity is tied up in that nest egg and you're thinking okay like you know when they pass away this is going to the family but then if they have a bunch of debt and you also know like not only is it but the debt is going to eat up that estate yep that is just like ah so parents if you can i know it's tough but if you're in your 50s and your your kids are sniffing around trying to get information they're not trying to tell you what to do they're not trying to get get up in your grill.
They're just, we just want to make sure we are planning. That's all I say.
Invite your kids over for dinner and tell them about your financial situation. Just tell us.
We want to know, do you have life insurance? How much? We want to know, what do you have in your 401k? We just, we want to help us. We're trying to help us by knowing about you.
This is The Ramsey Show. This show is sponsored by BetterHelp.
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That's why I'm pumped to bring the Money and Relationships Tour to a city near you. Join me and Dr.
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Grab your tickets at RamseySolutions.com slash tour before they're gone. You're listening to The Ramsey Show.
Thanks for hanging out with us. I'm Jade Warshaw.
Next to me is Dr. John Deloney.
We are your hosts for this hour. Something exciting coming up.
We're heading into the fall, and you all know that. Before you know, it's going to be Thanksgiving and then it's going to be Christmas and then it's going to be New Year's.
And if you're not careful, your money can go down a slippery, slippery slope, John. But we're here to help you.
We're doing a series of webinars and we've been doing them a couple of months here to make sure that you have everything you need not to lose control. And so join Rachel Cruz and the EveryDollar team.
We're doing a free live training. This one is Monday, November 4th at 1 p.m., 12 p.m.
Central Time. This is your lunch break, right? I just got off of one and it's great.
There's so many people on there. Over 100,000 people have registered over the lifetime of these events and people love them.
If it's your first time, you can do it. If you've been to a couple before, but you still have more questions, you can still sign up.
And by the way, if you're not available right at that time, still sign up because you can watch it later on when you are available. And so the way to register is you just go to RamseySolutions.com slash webinar and that's it.
We'll provide the rest. This is the number one way, guys, for you to eliminate your debt.
This is the number one way for you to learn to build wealth, the number one way for you to get on the same page as your spouse, and the number one way for you to eliminate stress. It all starts with the budget.
So get help with what you need. These EveryDollar webinars are popping off.
Again, that's Monday, November 4th at lunchtime. We'll see you there.
All right, John, you ready to go to these phones? Let's do it. Let's go out to Harrisburg, Pennsylvania and talk to Shannon.
What's up, Shannon? Hi. Thanks so much for chatting today.
I very much appreciate all of the advice we've gotten from you and FPU over all these years. So it's great to talk to you.
Thank you so, so much. How can we help? So my husband and I are 54.
We are debt-free except our mortgage, which will hopefully kick off next summer. Wow, congrats.
Yeah, thank you. So we have three children.
Our oldest is halfway through college and doing well. I'm sorry, our youngest.
But our oldest is 25. He's also a college grad.
He's got a great job, works with Excel. He's a numbers guy.
And he's paid off all of his student loans that he had. He's a great saver.
He's thriving by pretty much any measurement you put out there on paper. He lives with us still, not because he couldn't live on his own necessarily, but he has autism.

And by staying with us, he stays connected socially and emotionally,

which is definitely in his best interest,

but not something he would necessarily do on his own.

We think at some point down the road, he will likely move out on his own,

but as much in his life has been, it's just kind of on a later track. So we're trying to think through how best to help him be well-positioned for that independence when the time comes, personally and financially, and I would welcome any guidance or input you have on us helping him be well set and think through those things.
Yeah, I mean, kudos to you all. It sounds like y'all have done a lot of work and walked alongside him in the places where he's accelerated past those who would be inside the normed age of development and those times when it's been slower, right? and it's just taking more time to get there.
So good for you guys. Over the course of my career, I've worked with graduate students.
I've worked with law students. I've worked with any number of students who are somewhere on the spectrum.
And in fact, where I went to grad school, the connected to the college of education where I was, the Burkhart School for Autism was there. It was a magical place where I saw them do some amazing things with young people transitioning in and out.
I can just throw it out there and only you will know where your son falls in terms of where his spectrum disorder is and how he does socially. Let me ask you this one question before I start just throwing things out there.
If he finds himself alone, meaning like you guys go out of town for a week, does he end up just watching YouTube over and over again or watching videos over and over again or playing video games over and over again? That is certainly his bent. When we have gone out of town, we'll have friends or family kind of check in and make sure he gets invited to dinner or to movies or something so that he's not either working or being on a video game.
Okay, yeah, I'm hearing that more and more that young professionals who are on the spectrum disorder at some place, on the spectrum someplace, the allure and the way they've engineered these screens and social devices in the games, it's like their brains have been hacked. And it's tough for any of us, much less somebody with some sort of processing challenge.
So I would recommend this one, and this is a hard thing. This isn't me indicting you.
This is just my experience working with parents, you and your husband, y'all check yourselves first. Sometimes, not always, but sometimes letting go of the leash a little bit or a lot robs a parent who has spent their whole life advocating and defending and fighting for their kids with special needs or exceptionalities or specific challenges.
It robs them of their identity. And so make sure that you and your husband are intentionally together and you're intentional about feeling that loss, that sense of purpose as you let him go into the world.
The second thing is I would get with a, ABA usually works with younger kids, but I'd find any sort of group or any sort of connection where he can begin what I would call a, this is the wrong language, but some sort of outpatient where he can go hang out with some guys in the evenings, hang out with different groups in the evenings. You might host them at your house, but we just want a group of people that he's going to be able to stay connected to.
And then you guys are going to watch that closely. And for some students, they fly.
I mean, it's just been, I remember it was amazing. There was one group of students at the Burkhart Center that got involved with the theater department and they were a part of theater performances that unlocked parts of it was magic I always sat there and wept people hold all these shows um and then there's some students who at 28 29 30 years old just slowly loop their way back to watching YouTube 12 hours a night and then never sleeping until they collapse.
Right. And so you will truly come to know your kid over time with space and distance with intentionality after you're out.
And it might be that he's never fully on his own. It might be that he, part of a special needs trust after you're gone, will get him a garage apartment in one of his brothers and sisters' houses or in an extended care kind of place.
But I think it's you guys just facing that reality head on. Right.
On the financial side, like I said, he has a great job. He is a phenomenal saver.
So what are some ways that beyond us considering a special needs trust, like we have him set up, he started a Roth IRA this year. What might be some other ways that we can encourage him, even as he is such a saver, to be making that investment in his future? I think a lot of the things that you would do for yourself, you just transfer it and teach him how to do it.
So if you're a proponent of the baby steps, then we're teaching that same method of managing those finances. The fact that you're doing a Roth IRA is great.
If you max that out, then now we're going to a brokerage account. And so having that money there, does he make enough that if he were able to live on his own that he could? Oh, yeah.
Yeah, I think that's great. I think at that point, you're managing the funds the same way you would.
You're teaching him about how to budget. We're saying this is how much we're spending and we're giving every dollar a name.
And then we're going and saying, OK, beyond that, what are we investing for? Are we going to buy a place? Is there going to be a property that he lives at? And you guys are, again, with the social things, I think John has given you a good construct there. But I think if you find that there's a time where he moves on and out of your house, I think it's great to have those assets in his name.
And then all of that stuff can transfer to him when the time comes and his care. Or maybe a brother or sister that's got their name on the accounts too, just in case they need to step in.
But also, I always want to lean in the direction that's opposite of my kid's natural bent, special needs or not. And so if I have a kid that's a natural spender, I'm going to teach them really, I'm going to let them watch me save.
And if I have a natural saver that's just obsessed with saving, I'm going to show them the joy of spending money every once in a while and the joy of giving. And your kid will be none the different.
Congratulations. Listen, guys, I've heard just about every excuse for why folks think they can't get ahead with money.
So let's go ahead and settle this right now. The truth is you get to decide what happens with your money.
And if you want to start winning with money, you have to get on a budget. The Every Dollar Budget app makes it easy for you to plan every dollar you've got coming in and every dollar going out.
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I'm Jade. Next to me is Dr.
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Hey, has there ever been something money related and you're like, I know I should know this, but I don't. Like I've been on this planet for a long time and I should know what the lingo is.
I should know the jargon, but I just don't. And you're, you're embarrassed to ask me every day on this show.
So we started a new segment here asking for a friend and listen, I'll, I'll be honest. I may have been one of these people that for the longest, I was really confused about like what comes out of your paycheck when you get paid I still I'm not confused I just get mad listen I know I'm not the only one and when I saw this clip I was like that is that is me take a look at this my first paycheck look at the window there's my name hi me god isn't this exciting I earned this I wiped tables for it i steamed milk for it and it was totally not worth it who's fika why is he getting all my money relatable that's so true like you look at your paycheck i mean it happens all the time here people call and i do you make? They're like, I make a hundred thousand dollars a year.
But then like by the time what they actually take home, I come $11. So it's fine to me.
I get madder now when I hit potholes. I'm like, no, no, no.
You took my money. You fix the potholes.
Well, let's talk about what is it like? What's happening with this payroll tax? What is FICA? I'm asking for a friend. You know, some of you are going to be today years old when you figure this out.
But it's basically these this is Federal Insurance Contributions Act, right? This is that's what FICA stands for. This is what you're required to pay into basically as an American citizen.
It says the FICA tax, also known as just payroll tax, just refers to taxes that employers and employees have to pay. And these are programs like Social Security and Medicare, right? And when that money goes out of your check to fund those programs, it's funding them in real time.
It's not like I'm just setting this aside for me for later. It's for everybody.
It goes into a big pool for everybody. And so big picture is when you pay those FICA taxes, your money just goes into that big pool, a big fund.
And it's for whoever's currently receiving Social Security, whoever's currently receiving Medicare. That's why we say all the time to people like, hey, go on ahead and fund your own retirement because you don't know what Social Security will be when your time comes.
I think they're really clearly telling us it's not going to be very much. I mean, I feel like we don't know.
And they're like, we're going to run out of money. It's like, yeah, but we don't know.
I just want to know what happens if we do. I want my refund back because I've been paid.
Yeah, right. So FICA tax, it breaks down into two categories.
Like I said, you've got the social security and then you've got the Medicare. And if you're wondering like, how much is this? So for employers, you're withholdinging 6.2 they're taking 6.2 percent of your taxable gross um which is it can be pretty high depending on how much you make but and then they take that and they match your contribution so 6.2 on your end 6.2 on their end and it goes into that big pool and then for medicare it's 1.45 percent of your taxable wages and again they match that now the kicker is if you are like self-employed you pay both sides because you're the employer and the employee and that hurts like especially when you're trying to get a small business off the ground yeah yeah i remember uh my mother-in-law she always helped us with our taxes because she's a akeeper.
And when she explained that to me for the first time back, back, back in the day, I was like, my jaw was on the floor. I was like, it's so much money.
But, you know, even if you're self-employed, you still got to pay old Mr. FICA.
So freelancers, like I said, independent contractors, self-employed workers, they're required to pay both ends. Yeah.
And so again, just make sure to plan. Yes, you can't stop it.
It is the force of the government. There's nothing you can do.
You got to pay it, but at least you know what it is. And if you were so excited to earn your paycheck, and then when you looked at it, it was a little bit less, that's probably where it went.
For more information about taxes, go ahead and visit ramsysolutions.com slash taxes, or you can click the link in the description if you're listening on YouTube or podcast. And think about this.
If you're like, wait a minute, 6%, that's not very much. I pay way more than that.
This is not state income tax and federal income tax. This is just the other numbers.
Yeah. This is just Social Security and Medicareare that's right that's it and i love

dave said this once and it never occurred to me he said the greatest scam the government ever pulled was automatic deduction facts he said if you had to write and honestly when it comes to like medicare like taking care of the least of these in our communities i don't think that'd be the uproar i think the uproar would be does that state and federal tax if we had to write a check every month and give it to the government I think the average US citizen would be much more I don't think we'd be where we are because it wouldn't be this money that just out of sight out of minds and this given to a small group of people who just do whatever they want to with it I think people would be much more invested as citizens. Like, you're going to take my money, you're going to demand

it legally from me, then I'm going to demand

my voice be heard with how you

spend that. I mean, they basically

tapped into what we say all the time

about credit cards, which is when there's no friction.

That's it. You don't feel it.
And you're like,

yeah, take my money. I'm fine with it.

Then they came up with scam number two, which is

every year,

some of y'all were going to send you some of your money back and you're going to you won something right they're gonna think you scratched something off and got it isn't that crazy we think that we're getting like a treat or a prize when really they've just they held our money interest-free interest-free by the way they lent it out and uh are making money off of it right right they're making interest off our money listen Listen, we could go on and on all day. Maybe we should, John.
Nope. Let's go out to Phoenix, AZ, where it's still 1,000 degrees, even though it's October, and talk to Scott.
What's up, Scott? Hi. Thanks for taking the call.
How are you guys? You got it. Bro, what's happening to your weather out there? It's actually really nice right now.
Did it finally break? It's been bananas. So we're good.
Wow. Well, that's good to hear.
How can we help, man? Well, we're looking to replace our family minivan, and I'm debating how much to spend and whether or not I'd feel okay buying something new, which is something I've always thought I wouldn't do, and I can hear Dave in my head talking about how much a new car depreciates as soon as you drive it off the lot.

So I'm just trying to balance being responsible and not being a cheapskate. I love that.
I love that Dave's voice lives rent-free in so many Americans' head. Okay, well, tell us what it is, and we can tell you if it's a good idea or not, or at least point you in the right direction.
So what are you thinking of getting? What does it cost? uh we're at the 2025 Kia Carnival, which was just updated, and I'm expecting it to be around $52,000 or so. Wow.
Which previously we were looking at the 22 to 24 models, and this is going to be $10,000 or $12,000 beyond that. So a 2024 would be what, $40,000 about 40 was what we were planning.
Okay. Um, my wife is at home with the kids full time, but she's a rock star and still brings in an income too.
And she's just been saving up like nearly all of her income for a while. So she saved up like $38,000.
So we were going to pay cash for it. Then we started looking at the newer one.
And then I actually fortuitously happened to get a bonus. So we actually do have the money that we could pay cash.
For the $52,000 one? Trying to get over the mental barrier of the depreciation of the new one. Well, let's walk through that a little bit.
So you've got cash. There's a couple boxes we need to check to get the green light.
So you've got cash. That's good.
Let's talk about what your combined income is. What do you and her make together? Because again, this needs to be no more than half of your annual salary, give or take.
So what do you guys bring in? Yeah, together It's about 190 or so. Okay.
Okay so okay okay so we're firing on that cylinder well how much is your car worth uh maybe eight to nine thousand okay so we got a check box there now if you're talking about doing this 2025 a brand new vehicle you know what has to be in place next don't you all the All the insurance and registration that goes into that, that's way more too. Yes, but there's something quite critical to buying a brand new car.
You need to have a million dollar net worth. Oh, gotcha.
And here's why, here's why. And this answers the question that you're talking about.
When we're talking about this depreciating asset, you've got to basically be okay with putting that money right in the center of your living room and burning it and saying, I could care less that this thing is going to lose 60% of its value in the next three to four years.

Yeah.

The million dollars is an arbitrary number, but it's right.

It's a good, it's a good, like, like it checks you.

It checks your gut.

It's a gut check to go, how, how much can I really afford this?

How meaningless is this money to me? Right. And donating 20 or 30 grand to the car dealership over a couple of years.
The truth is, if you have a million dollar net worth, all boxes and all roads lead to you being able to do this. But if you don't, you need to go with the 2024 and pay cash.
This is The Ramsey Show, helping you with your life, your money, your relationships, your career. I'm Jade Warshaw.
Next to me today, the doctors in the house, Dr. house dr john deloney what up how's it going in your world we're did i'm i'm we are busy busy we had a wild and adventurous money marriage as best we can and it was off the hook dude you spoke at it um it was the deepest and probably most impactful thing i've ever been a part of yeah yeah what you got right there um i got these questions for humans the intimacy deck they actually sold out on campus they're gone um you can get them online now i'm waiting for our own new shipment back this is the only deck that exists in this uh in this building but it's just questions about sex and intimacy and connection and communication and couples trying to find their ways back to each other with all the anxiousness and schools and games and stuff and stuff and things we got to do.

Like it.

Just sit down across the table and get to know each other again.

I like it.

I'll be getting a deck.

All right, let's go to the phone lines.

We got Wes Evansville, Indiana is where he's at.

What's going on, Wes?

Hey, guys.

How you doing?

I appreciate the time.

You got it, Wes.

What's up, man?

Yeah, for sure. So this may be a question for more of a counselor, and I might need some serious therapy, but let me lay it out here for you.
If you can give me just a second. Go for it.
So I feel like I got a couple problems and basically they deal with internal conflict, you know, within myself. I feel like I got a value disorder.
Lay it out there. I'm seeking.
Lay it out there. Yeah, yeah, yeah.

So I feel like I'm seeking comfort while I'm trying to seek my dreams in my business. Obviously, I got a money problem, debt versus cash flow, and then a self-belief.
So let me lay it out here. I'm 35.
I'm divorced. I got two kids living at home with me over half the time.
I started a window cleaning business 12 weeks ago, and I've made $12,000 in 12 weeks. My expenses are about $5,000 a month, and I make $4,000 a month, as of what I've shared with you.
I got $32 in the bank. I'm behind on two credit cards, my light bill and my mortgage as of 30 days ago.

And here's where I'm basically looking for some counsel here. I'm kind of frozen in time with building this business and getting Gazelle Intense because of where I'm at financially.
and so I'm struggling with getting gazelle intense to climb myself out of my hole, you know, with my business of my own.

I'm a one man show.

And basically I'm at a place where I'm considering getting some, you know,

getting a debt relief company to do their thing.

No, you're not going to do that. You can do that.
With my bills. All right, Wes.
Okay. Hold on.
Yeah, go ahead. Did I hear you right? You make $4,000 a month, but it costs $5,000 a month to run this thing? Yeah, basically my expenses.
There's hardly any overhead. I'm a one-man show going door-to-door getting window-cleaning businesses.
But how does it cost five grand a month in expenses? Is that just business or is that your personal stuff rolled in? It's basically all personal because there's really no, there's really no overhead. Like I'm banging on doors.
So to clarify, to clarify, you're going're hitting the pavement you're making four thousand dollars you're pocketing it all as income you're one man show that's fine but to run your personal life is five thousand dollars your personal budget is five thousand dollars a month so you're a thousand dollars deficit every month yeah so give or take forty six hundred bucks one month okay you know and how do you How do you account for it is it going on credit card what do you do when you're when you're at a loss um yeah i well it's only been 12 weeks but um i'm behind on those those you know so you just don't pay them you don't you're just not paying them but are you putting more debt on a credit card is what i'm asking well i'm maxed out everywhere so i don't really have to go i'm kind of at a place where i might my my credit's toast i can't get any more okay okay i just need to put energy into this thing no no no no no that's not it that's not it, dude. Okay.
How long ago was your divorce?

So it finished about a year and a half ago. Is that still hanging around your neck? It was a crazy divorce.
Yeah, it's trauma, man. It was crazy.
It was a circus. It was, but I'm talking about is.

Sit with me for a second. You back and forth, you toggle to keep yourself safe from the past and, oh my gosh, it's crazy, to the future.
It's all coming down. I want you to sit right here in the middle.
Right here in the middle. Is it still weighing on you that the person you said I do, the mother of your kids, that y'all had to blow up like this? Yeah, I mean, I'm still kind of hoping that we can kind of fix it.
Okay, you got to let that go. We're in process doing that.
Are you dating again? No. Okay.
So, here's the thing. I think you have a core reality problem.
Okay? I don't think it's a... I feel like it's a value disorder, yeah.
Yeah, but it's not a value disorder. It's that you want things to be...
You want to be your own boss. You want to be a present dad.
You want to re-get together with the ex-wife that blew your life up. You want to do all this stuff all at the same time.
I do. I want to do it all now.
I know, but in the meantime, math is working against you because math doesn't care what your dreams are. It doesn't care what pain you've been through.
It just keeps doing math. It keeps doing math, yes.
You're getting further and further and further behind, and your kids absorb that tension in your house, and you want to have a different mindset. People think they can just think their way to confidence.
Confidence is built through. I can't.
You can't. You've got to go do.
And, dude, you're grinding, and I'm proud of you. You're making $4,000 a month on a brand-new business.
That's amazing. And you can't eat on $4, month.
No, dude, it's, it's been a bummer. And so here's what I want you to do.
I want you to not think about, okay, I got to grind here. I want you just to exhale and sit in reality.
And most people, most of the time, myself included, when you have to face reality, you have to grieve it for a minute that woman's gone this job this dream we have of going all in it's not a right moment right now i wanted my kids all the time i only get them half the time that's exhale and then i'm gonna go get a regular boring bummer job where i'm throwing boxes somewhere but i've got health insurance and i'm making x number of dollars an hour and then i'm also knocking on doors and putting up flyers and washing windows when i can to get this thing going and you're going to find out that the life of a solopreneur is wall to wall 24 7 365 until it finally takes off if it ever does right and then your kids are going to have this ringside seat to a dad that got his knees capped in a divorce, but he got back up and he started grinding and he was still a person of integrity and character. And you're going to wake up in two years and three years and you're going to be really, really confident, not because you thought your way to some mindset moogly boogly, but because you just went and did the next right thing.
And the next right thing is? You've got to make enough money to eat. Yeah.
How many hours are you putting into this every month, every week? Yeah, that's where it gets embarrassing because I'm putting about 20 hours in, but the rest of it, the time, I just can't get myself to move. I'm frozen.
Okay, then let that dream go. The thing is, here's the thing, though.
If you're putting 20 hours a week into this and you're making $4,000, imagine if you put... Right, that's why I think...
Yeah. Why don't you want to do it? Yeah, yeah, yeah.
What's causing you to not do the other 20 hours? That's where my value disorder comes in, the seeking comfort versus the dream. I mean, it's hard to think at work.
I'm good at what I do, man. I can get jobs every day I go out.
It's not a value disorder. It's not a diagnostic.
Don't call it that.

What is it? I just need to

figure it out. There's nothing to figure out.

It's a choice.

I like this work.

I don't...

I want to make this solopreneur thing work.

I don't like this work

and I'm not going to do this solopreneur thing.

It's just a choice you have to make.

Or you go and pick up another job for the other 20 hours but either way you got to work as an adult we have to go to work that's it it's not it's not it's not a disorder it's not a thing it's just it it is you got to make a choice do i want to do this job or not yeah and jade you and i we have on the outside looks like a mate the dream job these jobs are hard you and I get frustrated. There's a lot of hours.

It's early.

It's late.

I'm wearing makeup right now

for crying out loud.

It's a whole thing, right?

Every job's got hard,

hard, hard seasons.

Every job does.

Yeah.

You got to decide

is the hard season

worth the work, man?

That's it.

This is The Ramsey Show. Hey, you're still here?

What are you doing?

You do know that the rest of today's show is playing right now over on the Ramsey Network app, right?

All you got to do to finish the episode is search Ramsey Network in the App Store, Google Play Store,

or just click the link in the show notes to download the app for free.

Yep, you heard me right, for free.

Then right there on the home screen, you can watch the rest of today's show.

Bada bing, bada boom.

All right, I'm getting out of here.

Enjoy. We'll see you on the app.