Being "Normal" with Money Sucks, Be Weird!

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

Speaker 1 Rachel Cruz, number one best-selling author, co-host of the Smart Money Happy Hour and Ramsey personality. Also, my daughter is my co-host today.
Open phones at 888-825-5225.

Speaker 1 Thanks for hanging out with us, America. The call is free, and some say the advice is worth exactly what you pay for it.
Katie is with us in Los Angeles. Hi, Katie.
How are you?

Speaker 2 Hi. I've been better.
How are you, Dave?

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

Speaker 2 Well, I am a stay-at-home mom of two young kids, and my husband is a business owner.

Speaker 2 I've been living with my head in the sand for the last couple of years as he's managed the money.

Speaker 2 And I've just recently discovered how poorly he's been doing that.

Speaker 2 We are in a world of debt right now and trying to find a path out of it.

Speaker 2 Okay.

Speaker 1 So what caused you to suddenly become aware?

Speaker 2 He called me one day and said, I'm going to tell you before you get home to see the mail today, but we got a foreclosure notice on our house,

Speaker 2 which was due to a second mortgage he took out on our house in order to purchase a warehouse for his business.

Speaker 2 I naively thought, okay, I'm going to fix this.

Speaker 2 I'm going to cash out one of my 401ks, pay that off, get the house out of foreclosure, and then we're going to move forward and do everything right from here on out.

Speaker 2 That was very naive. As I started to dig deeper, I realized

Speaker 2 the trouble that the business was in. He has a huge overhead.
and is not making enough to sustain that.

Speaker 1 How old are you guys?

Speaker 2 I'm 39. He's 42.

Speaker 1 How long have you been married?

Speaker 2 Six years.

Speaker 1 When was the phone call on the foreclosure notice to you?

Speaker 5 Well,

Speaker 2 on the house or on the phone.

Speaker 1 Now, when did he call you? What day? How long ago did he call you and say?

Speaker 2 Oh, this was this was back in May.

Speaker 1 May. Okay.
So

Speaker 1 you've been gathering more information, and you all have been having more discussions for a couple of months now.

Speaker 1 Correct. Okay.
All right. So

Speaker 1 what is he now saying?

Speaker 2 He is, he has a very motivated mindset, and he feels like he just needs to keep pushing forward with the business.

Speaker 2 And things are going to turn around any day, any week, and he's going to be able to fix all of this. Meanwhile, it feels as if

Speaker 2 things

Speaker 2 are not getting better. Things seem to be getting worse.
Twice this month, he's not been able to make payroll for the employees.

Speaker 2 I've found out about some IRS debt, some property tax that's delinquent.

Speaker 1 So why are you, once you discovered one thing,

Speaker 1 why do you not have a conversation when the two of you sit down and he tells you everything? Why are you having to continue to pull the thread on the sweater?

Speaker 2 Well, eventually he did.

Speaker 1 Once I found out about the IRS debt. So we're all on the same page today.

Speaker 8 What's the total debt, Katie?

Speaker 2 Including mortgages? Yeah. Sure.
Yeah.

Speaker 3 About

Speaker 2 $4.5 million.

Speaker 1 Okay. And how much is the mortgage on your home?

Speaker 2 Our mortgage is, we owe $480 on the house, plus the additional, the second mortgage, which is $400, so about $880.

Speaker 1 What's the house worth? What's the house worth?

Speaker 2 Probably $1.1 million. Okay.

Speaker 1 What's the mortgage on the warehouse? Is there one?

Speaker 2 The mortgage on the warehouse. Yes, there is.
The mortgage on the warehouse, we owe about $3.30 on it.

Speaker 2 And the monthly payment on that is about $26,000.

Speaker 1 And what's it worth?

Speaker 2 It's worth $4.1, $4.2,000.

Speaker 1 Okay. Is it on the market for sale?

Speaker 3 Yes.

Speaker 1 I set down what our sales are.

Speaker 1 Okay, so that's on the market. Is your home on the market for sale? No.
Okay. And

Speaker 1 so what other debt is there other than these two?

Speaker 2 There's credit card debt, which totals about $120,000.

Speaker 2 There's a personal loan from my parents, which is $115,000.

Speaker 2 There is the property tax, which is about $100,000.

Speaker 2 There are our ridiculous cars, which are $140,000.

Speaker 1 Are they on the market for sale?

Speaker 2 No.

Speaker 1 They need to be today.

Speaker 2 Okay. Okay.

Speaker 1 Now, is he...

Speaker 1 The thing about business is this, okay? You do have to be an optimist to operate a business.

Speaker 1 And to operate a business in California, you have to be an unbelievable optimist with the taxes and the regulations and the crap you all face. Okay.
It's unbelievable.

Speaker 1 So he has to be an optimist or he's dead in the water. So we have to have that category we can put him in.
That's a good thing.

Speaker 1 But what you need to hear, and I don't know the answer to this, is you need to hear him articulate a detailed tactical strategy, a strategy overall, but the tactical implementation of the, what items are we doing to make this thing profitable?

Speaker 1 Because all you're describing to me are signs of death of the business. He has some reason, hopefully, logically, that there's a reason for life

Speaker 1 in the business. I don't know what that is.
I'm not hearing his part of that story.

Speaker 1 It is possible that he's got four things that if those, that if three of the four things levers flip, that he can can turn the business around okay but the poor management and continue to go further further into debt is a pattern of i think i cannot earn my stupidity and that's what you need to see him stop doing because it's driving you nuts

Speaker 1 so the two of you need to sit down and you know it's okay for you to quote require of him

Speaker 1 for your peace of mind as his wife that he show you what the clear path is and exactly what the steps are to get out, Not just if I grip my teeth, it's going to get better.

Speaker 1 Because if I grip my teeth and keep doing the same thing, it ain't going to get better. It's going to keep doing the same thing.

Speaker 8 Yeah. And I think a timeline's appropriate too, Katie, because you guys could sit here in this, like,

Speaker 8 in this cycle forever and ever. And you need an end date, or I would.
I would be like, hey, I will give you X amount to figure this out. But at some point, you got to just stop it and go get a job.

Speaker 8 Like, we have to clean this up.

Speaker 1 I mean, it's just.

Speaker 1 So Henry Cloud says in his book, Necessary Endings, that you end something when you lose logical hope that it is going to get any better.

Speaker 1 Okay? So when do you close a business? You close a business when you have no reason logically to believe it's going to turn around. And you need to see something other than all the death signs.

Speaker 1 You feel like you're sitting beside the hospice patient hearing all the signs of death coming.

Speaker 1 And yet it's not a hospice patient, maybe. Maybe it's just a patient that's got the flu.
But that's how you're feeling because you don't know what's going on here. I don't know what's going on.

Speaker 1 Selling the warehouse is going to be a big lick. That's going to be really helpful.
Getting rid of your cars is really helpful.

Speaker 1 And, you know, we got to get back to scorched earth. We got to get this thing right-sized to where we can make payroll and we see a path, a light at the end of the tunnel that's not an oncoming train.

Speaker 1 The two of you need to find that together.

Speaker 8 And if you don't see it, Katie, you speak up too.

Speaker 1 Because so far the pattern's not been here.

Speaker 8 IRS stuff, I mean, it's not looking good.

Speaker 1 No,

Speaker 1 he has poorly managed it. That's for sure.
But if there is a clear path, but otherwise, we need to talk about how we're going to sell everything off and shut it down.

Speaker 1 So, you're right on track. And trust your gut.
You've got good gut instincts on this. This is the Ramsey Show.

Speaker 1 Rachel Cruz, Ramsey Personality, is my co-host. Sometimes our segments...

Speaker 1 Aren't long enough to get into everything. Obviously, the lady with $4.5 million worth of debt, a husband, the business is failing.

Speaker 1 She didn't know anything about it because she was not involved until a few months ago, and now she's trying to find her way through that. And giving her a quick answer on that's very difficult.

Speaker 1 But there's some principles that Rachel gets to talk about, and I get to talk about a lot that weave into a situation like that.

Speaker 1 By the way, the irony of that call is it's almost exactly where we are, where only I wasn't 42, I was 28.

Speaker 1 I had $4 million worth of debt. Rachel was a brand new baby when we hit bottom, but it took two and a half years of fighting for us to go all the way to the bottom to bankruptcy.

Speaker 1 So by the time I filed bankruptcy, it was the year she was born. But Sharon was a full-time mom with Rachel's older sister and had absolutely zero knowledge of anything going on.

Speaker 1 Not because I was deceiving her. I just didn't ask, nor did I tell.
And neither did she ask. She's like, she's just classic, whatever you want to do, honey, and just assumed I had a clue.

Speaker 1 I thought I had a clue. And I was wrecking a business.
And

Speaker 1 so there's a couple of things

Speaker 1 that go with this, principles for you guys to use out there that'll keep you from

Speaker 1 finding yourself in a situation. They may be so far gone, they don't make it out of that.
They may be bankrupt. They may lose everything.
We did

Speaker 1 because we were so far in. So principle number one

Speaker 1 is

Speaker 1 men in particular, but ladies too, when you are running a business, it does not give you relational or wisdom permission to keep that all the other side of some kind of wall.

Speaker 1 Now, you don't need to come home and whine every night to your spouse about everything being hard. Nobody wants to hear that.

Speaker 1 But your spouse needs to be involved in all major decisions that affect the household, and that includes the running of the business. Period.
And here's why.

Speaker 1 Proverbs says, who can find a virtuous wife? For her worth is far above rubies.

Speaker 1 The heart of her husband safely trusts her,

Speaker 1 and he will have no lack of gain.

Speaker 1 And so while my sweet little wife is at home with a little baby, And she's a full-time mom with a home ec degree, she's academically not qualified to speak into the operation of my business. But

Speaker 1 the Bible says that if I listen to the wisdom of my virtuous wife, I will have no lack of gain. The way Sharon says it is, I may not understand, but I have common sense.

Speaker 1 And she throws that around like,

Speaker 1 and she does have common sense. She has wisdom.
And so I...

Speaker 1 After I went broke and I learned that proverb, I no longer make major financial decisions, major decisions of any kind, without Sharon and I talking it through and being in agreement.

Speaker 1 Now, sometimes we argue about it, sometimes she's wrong,

Speaker 1 sometimes she's right, and I hear something I never heard before, and but I don't, you know, we don't go and buy a $2 million building and then tell her we did it.

Speaker 1 We can,

Speaker 1 but we don't. And so we don't, you know, I don't book,

Speaker 1 we run our calendars, we run our budgets together. We know where

Speaker 1 everything that's going on in our time, everything that's going on in our money.

Speaker 1 And therefore, we make better decisions. And the added benefit is that it absolutely solidifies your marriage against the storms that will come.

Speaker 8 Yeah. And being able to, I think, go there with your spouse too is what we talk about so often is having this knowledge and understanding of who they are.

Speaker 8 Because usually in those business conversations and/or the money conversations,

Speaker 8 the person and their fears and their, you know, anxiety around this subject over here or the thoughts of this or the excitement of that, like you get to know your spouse in the middle of it too, right?

Speaker 8 I mean, like, there's, there's all this added benefit to not only having somebody outside the picture looking in with a different perspective, which is so wise and so healthy, but you also, you're doing stuff as a team.

Speaker 8 And when you're married, that's where a rich marriage comes from is that you're on the same team and you're talking about it.

Speaker 8 And you get get to know your spouse in the middle of it even more versus, again, feeling like, okay, this whole part of our life is over here and I'm not going to bring you in.

Speaker 1 So if you're in the situation where that lady's husband is, you're the husband or the wife and you're in that situation, you're running a business.

Speaker 1 As of today, it is now your job to unpack everything that's going on

Speaker 1 that is of note, anything of size. We don't have to discuss where we buy copy or paper, okay? But we are going to talk about the big things that are happening in the business.
Here's what's going on.

Speaker 1 Here's how we're running the business. Here's the things.
And we're not going to

Speaker 1 move the big pieces around the chessboard without talking about it further. If you are the person who is at home or is not in the business, so to speak, it is your job as of today

Speaker 1 to know what the flip is going on in your own life.

Speaker 1 You are not a little child.

Speaker 1 You have to plug in. And if they don't want you to, that's a bad sign.

Speaker 1 if you're just too lazy to you don't want to put forth the effort oh he's handling it i'll let him handle it that's just laziness and you're gonna make really stupid butt decisions and you're gonna craft a life that you don't like at the end of the story if you don't plug in and make these calls together like two grown-up adults

Speaker 1 well we're not alike we don't we look at things differently absolutely two most of the time opposites attract larry burquette used to say if two people just alike get married, one of you is unnecessary.

Speaker 1 Of course one of you is a suspender. Of course one of you is a saver.
Of course one of you is an abundance and the other one's a scarcity. Of course.

Speaker 1 So what?

Speaker 1 What that means is you're getting good, rounded viewpoints on these major decisions. And you don't reach a point that, oh, I borrowed on our home where our children sleep

Speaker 1 by a warehouse.

Speaker 8 Can I say that feels deceitful?

Speaker 8 Like when you start to muddle the waters, which I know happens a lot in business, but you start to reach over to the per like putting that in danger, that that feels like,

Speaker 8 I don't know why it feels different if it's like, oh, I went and got a warehouse, but my own home, like my home, that feels so personal. I don't like it.

Speaker 8 That felt deceitful to me.

Speaker 1 Well, it's not

Speaker 1 because the arrangement that they were...

Speaker 1 No, the arrangement they were operating on is she don't care. He can do whatever he wants.
And so he did whatever he wants. And he had no, he had no thought that he was going to lose the home.

Speaker 1 He thinks it's just going to turn around and he's going to outearn his stupidity. He's make all his own money.

Speaker 1 He didn't sit down and

Speaker 1 sat down and go. Now, I will tell you this.
Having adopted this, we don't do major things without Sharon.

Speaker 1 It means that I actually have to not only sell myself on the idea of going forward on something, I have to sell her on it. And

Speaker 1 it makes me critically think through the idea more thoroughly, knowing i've got to get agreement from someone else i've got to be able to explain it in such a way that it makes sense and get agreement that's why we always talk about don't do your money alone even if you're single have somebody an account something that you are accountable to right yep a spouse a friend again if you're single maybe it's a mentor like whatever it is whatever it is it's hilarious that inside of our own little brains we can talk we can make the dumbest thing we're crazy We can make the dumbest thing sound smart inside our own little brains.

Speaker 1 But when you have to speak it and set it out on the table in front of someone that loves you and that cares about your future, as soon as you set it out on the table, sometimes before they say anything, you go, oh, that's dumb.

Speaker 1 Oh, that's, I, and when that was in my head, it was really smart. But when I put it out there in the daylight, it looks really stupid.

Speaker 1 And it's almost like that time that you had this problem and you sat down with your friend. And by the time you explained your problem to your friend, you knew the answer.

Speaker 1 And all that is, is your brain had to process from simple digits floating around in your brain into verbalized. When you have to turn something into language,

Speaker 1 your brain is required to go through another higher function of critical thinking skills.

Speaker 1 So when you turn something from a thought into language and put it in front of someone else, it makes you process the thing you're talking about more thoroughly.

Speaker 1 That's why you already know the answer before your friend ever says anything. You go, oh, thanks for listening.
I now know what to do. And they never said a word.

Speaker 1 They just look at you like a hood owl, right?

Speaker 1 And the same thing's true here. You know, it's when you have to do this with your spouse, it opens up everything.

Speaker 8 It's like right before this show, I was telling Dave about my new prepping conspiracy that I heard last night, and he looked at me like a hood owl, and he just shook his head and we just went to air.

Speaker 8 It's good to say it out loud sometimes.

Speaker 1 You're like, I don't know.

Speaker 1 I don't know about that conspiracy. I guess there's one in every family.
This is the Ramsey Show.

Speaker 1 Rachel Cruz, Ramsey Personality, is my co-host today. Open phones at 888-825-5225.
We've been talking about the Live Like No One Else cruise that is March 22nd through the 29th.

Speaker 1 It is not yet sold out. This announcement today will probably sell it out.

Speaker 1 Big announcement. Blow the trumpets.

Speaker 1 Right, here we go. All right, you ready? We're going to St.
Thomas. We're going to Turks and Caicos.
We're going to Puerto Rico. We're going to the Bahamas.
You knew that.

Speaker 1 It is on a Holland America, high-end, nice, virtually brand new ship. You know that.
100% of the people on the ship will be Ramsey people.

Speaker 1 All people that are baby step four and beyond, if they do what we told them to do, and they live like no one else. Now they're living like no one else.
It's a milestone cruise.

Speaker 1 You get to go on this cruise with all the Ramsey personalities. Maniet Shohan from the Food Channel,

Speaker 1 Dove Award winner.

Speaker 1 recently added to the grand old opera, Stephen Curtis Chapman, Dina Carter, country music star, Stephen Bargatzi, that's Nate's dad. A couple of other comedians are on there.

Speaker 1 And here's the big announcement. Drum roll, please.

Speaker 1 Cabins are running low, but just today we contracted with Trey Kennedy.

Speaker 1 And Trey will be a comedian on there with us as well. If you don't know that name, you should.
He's one of the biggest, hottest things on Instagram right now, blowing up everywhere.

Speaker 1 The guy is absolutely stone-cold, hilarious. One of his specialties is making fun of me.
He makes a lot of money making fun of me.

Speaker 1 And so, for some reason, our team thought we should give him some more money to come on the cruise. And so, now Trey is going to come on the cruise and make fun of me.
That's fun. It's great.

Speaker 1 There's a lot of really funny stuff out there, memes and so forth, and Trey is the source of some of it. So, be sure you check it out.
Trey Kennedy, if you don't know who that is, look it up.

Speaker 1 You should. It's a huge ad to our lineup.
And that is the last

Speaker 1 stone in the arrangement the last flower in the arrangement to for our lineup there won't be any more surprise announcements but there is just a handful of cabins left so go get your cabin you can put up a 600 deposit before they're gone if you want to upgrade the cabin later if somebody drops out you can step up into one of theirs can't do that if you're not already on board and so we help you do that you can't sit around on the outside and hope it works out it's not going to work out you're going to miss the cruise march 22nd through the 29th seven full days.

Speaker 1 All the Ramsey personalities, me included, all seven days. We're going to be doing all the events, and it's going to be like the whole tribe is on there.
It's like a tribal thing. Cool.

Speaker 1 So, Ramseysolutions.com/slash cruise. Again, Trey Kennedy, awesome new, brand new entertainer ad today.

Speaker 1 And

Speaker 1 you don't want to miss this. Ramseysolutions.com/slash cruise.

Speaker 1 And Rachel,

Speaker 1 it is disturbing that he doesn't make fun of of you.

Speaker 1 No,

Speaker 1 he's nice to me.

Speaker 8 Okay, you're just an easy,

Speaker 8 you're an easy poke sometimes, you know?

Speaker 1 I'm an easy, I'm an easy mark. Is that what you're saying?

Speaker 1 I leave a lot out there that could be.

Speaker 8 The boomer vibe, and people like to go after it.

Speaker 1 The boomer vibe. Oh, yeah.

Speaker 1 People like to go after it. It's a good thing to go after.
I mean, it's an Instagram thing to go after the boomers, so I get that.

Speaker 8 We're just mad that y'all bought houses that were, you know, $20,000.

Speaker 1 I bought a house worth a bucket of strawberries. That's exactly right.

Speaker 1 I traded one bucket of strawberries from my house. Now it's worth $42,000.

Speaker 8 We're all just mad about it.

Speaker 8 You can make, you know, $20,000 and be fine in life.

Speaker 1 You know, just the 80s. And y'all, how were they? And y'all never took economics to find out that those numbers are actually not.

Speaker 1 I was kidding. But there they are.
But there are low, though.

Speaker 8 We're just mad at y'all.

Speaker 1 Amanda is in Memphis. Hey, Amanda, what's up?

Speaker 9 Hey, Dave. Thank you for taking my call.
Sure.

Speaker 1 How can I help?

Speaker 3 I need guidance.

Speaker 9 I need to know, we got a loan on our home,

Speaker 9 and it was, they were not transparent about any of the fees.

Speaker 1 What do you mean? It's kind of hard to

Speaker 9 in all the fees that were associated with the loan, the APR. The only thing we knew was the interest rate.
We knew the interest.

Speaker 1 That is the APR. Why did you sign the documents if you didn't know what you were doing?

Speaker 9 Well, when it came to closing,

Speaker 9 I mean, so the lender was telling us all along that he would tell us the fees once we settled on the percentage that we were going to put down. It was pretty cut and dry, Dave.

Speaker 9 We wanted to walk away from our other home with $75,000 under 6%

Speaker 9 and have a house note $2,000 or under.

Speaker 3 It was that simple.

Speaker 4 But it didn't.

Speaker 9 It wasn't that simple.

Speaker 1 When you went to the table and it wasn't that, why did you sign it?

Speaker 9 We didn't know it wasn't that.

Speaker 1 You didn't sign a mortgage paper that had a blank in it. That's bullshit.
No, no.

Speaker 9 No, didn't say that.

Speaker 1 Yeah, you did.

Speaker 9 Okay, but the loan is just in my husband's name. It is not in my name.

Speaker 1 I don't care. Why did he sign it?

Speaker 9 I'm the one that did all the conversation.

Speaker 1 Were you at the table when he's there to sign it?

Speaker 1 I was at the table. And you looked down and the numbers aren't right and you signed it anyway? Why did you do that?

Speaker 9 I wasn't a signer.

Speaker 9 But besides that, let me go backwards just a little bit.

Speaker 3 Okay.

Speaker 9 Because the lender said, okay, 6.375.

Speaker 9 He said, I'll get you under 6% if you sign with us right now. And so we did that.
We got on the computer. We signed with them and everything.

Speaker 9 And so then it became,

Speaker 9 you know, they wouldn't tell us any of the fees. The underwriter said, we'll get the paper over to you so you will know what all your numbers are before you go to the closing table.

Speaker 9 And if you need someone there to sit with you, we have someone in your city that can sit with you. And we said, no, let's just wait.
And we went through the process. And then

Speaker 9 we go to the closing and the closing attorney says, you know, here's. Here's this,

Speaker 9 you know, you've already went over this, dah, dah, dah. You know how they go through it.

Speaker 9 We went with this company because they said they were going to do everything. So we just assumed that's how it was.

Speaker 3 Okay.

Speaker 9 When we told them what we wanted to go to, we didn't know what our cash out was going to be until after all the papers were signed.

Speaker 9 After all the papers were signed, the closing attorney came downstairs with a sheet of paper and a breakdown and said, and you're getting $65,000. Like, no.

Speaker 9 We're supposed to be getting $75,000.

Speaker 9 So

Speaker 9 we didn't know anything. They were transparent, not transparent, and they misguided us.
We had to pay for points. They never told us we had to pay for points.

Speaker 9 There were many things.

Speaker 9 And to the point that I called after the loan to the underwriter.

Speaker 1 Okay, why did you not turn around and look at the attorney and say, just tear up the documents? I don't want $65,000. I didn't know what we agreed to.

Speaker 1 We're not doing this closing.

Speaker 9 Our house was sold.

Speaker 9 We were in

Speaker 9 a stress. We're both 61.

Speaker 4 I mean, we were.

Speaker 1 That doesn't mean you have to accept a deal.

Speaker 9 No, we don't have to accept a deal.

Speaker 1 Just look at him and go, this isn't what we agreed to. Tear up the papers.
We're not doing this. And where are we going to live? Honey?

Speaker 1 So what it amounts to is you willingly did this

Speaker 1 because you felt trapped

Speaker 1 instead of standing up and saying, no, I'm walking out of here.

Speaker 1 So.

Speaker 9 You're right about the trap part.

Speaker 1 I mean, I said, because you felt trapped. You weren't trapped.
Stand up, walk out, go rent an apartment and give them the middle finger as you walk out the door. Don't sign stuff and then gripe about

Speaker 1 what you signed.

Speaker 1 When you sat down and looked, your husband signed it after you sat there and looked at it.

Speaker 1 If you say to me, you're going to give me the numbers before I go to closing, then we don't go to closing until you give me the numbers.

Speaker 1 And we don't go to closing if the numbers aren't what you tell me they're going to be. I look at stuff ahead of time.
That was your job. It's not their job.

Speaker 9 But it's their job to get it to me.

Speaker 1 It's your job to not do anything until they do.

Speaker 4 True.

Speaker 1 Okay.

Speaker 1 You let this happen.

Speaker 9 But like you said,

Speaker 9 at our age and no family to run to, you're right. We could rent, no doubt.

Speaker 1 But we had. Hey, I'm sorry, darling.
I'm older than you, and I ain't feeling trapped.

Speaker 1 And I don't need to run to my family. I'm just going to walk out the door if somebody's trying to screw me.
It's that simple. I'm going to stand up and walk out the door.
Like, is there any way?

Speaker 1 Sorry, you're not a victim. You're not a victim of anything except your inability to look at someone and say no.

Speaker 1 Just look at them and say, no, I'm not signing this. It's not what we said.
That's who you're a victim of. You're a victim of your own inability to say no.

Speaker 1 You and your husband should have thrown your shoulders back and said, no, this is not what we agreed to. And walk away.
This lender didn't do anything wrong. They were just sloppy at best.

Speaker 1 This is the Ramsey Show.

Speaker 1 Rachel Cruz, Ramsey Personality, is my co-host today. Open phones at 888-825-5225.

Speaker 1 I was telling our team and staff meeting on Monday that

Speaker 1 how we do what we do at Ramsey, helping people with God's ways of handling money, grandma's ways of handling money, common sense ways of handling money, how we do it has changed a lot over the 30 years.

Speaker 1 The advice has not changed hardly at all because it came from the Bible. The Bible didn't change, and it came from common sense, and common sense doesn't change.

Speaker 1 Now, there was no digital anything when we started. There was no computers.

Speaker 1 We didn't have a computer. There was no internet.
There was no podcast for sure. YouTube hadn't even been thought of.

Speaker 1 MTV was quite the rage.

Speaker 1 But, you know, it was a different time.

Speaker 1 Infomercials were a thing. VHS tapes are what we started with, right?

Speaker 1 And so we were telling the team this: I said, the things that I say that are from God and your grandmother are

Speaker 1 the exact same things I say today. I said, back then, it really hasn't even changed.
So our producer, James,

Speaker 1 decided to take upon himself to prove that. And somewhere down in the deep bowels of Ramsey, he has uncovered a video

Speaker 1 of me on a TV show, I guess it is, from 1995.

Speaker 8 30 years, almost 30 years.

Speaker 1 So let's see if I say the same things or not.

Speaker 1 If you have very few of these,

Speaker 1 but a whole lot of these, you're going to like our show today.

Speaker 11 We're going to talk to a financial expert. His name is Dave Ramsey.

Speaker 10 What's the number one question that you get on the air concerning financial problems? What do we want to know? Concerning financial problems, how to get out of debt.

Speaker 10 How do I get out of debt? And I would say the second thing is communication with spouses. It's the stuff grandma talked about.
So save money, live on less than you make.

Speaker 10 Two concepts Congress can't grasp.

Speaker 10 And then we talk about getting out of debt. The borrower is servant to the lender.
And so lay down a plan, have a budget, spend every dollar on paper before the month begins.

Speaker 10 Because it's more behavior than it is math. Don't spend money you don't have.

Speaker 10 Understand, when half your net worth is tied up in something that loses 60% of its value in four years, you're not going to get ahead.

Speaker 10 I don't meet with people with a million dollars that say, gosh, Dave, I got ahead using credit cards and car payments. What solves it is getting mad at it.

Speaker 10 Some healthy, righteous anger and saying, hey, that's it. I'm drawing a line in the sand.
I'm going to be weird. I'm going to get this stuff paid off.

Speaker 8 Oh, my gosh. I have no words.
I have no words. Your voice was so, you're so, it's changed.

Speaker 1 How old were you in that?

Speaker 1 How old? I was probably about your age.

Speaker 8 Mid-30s? Yeah.

Speaker 1 Oh, my gosh. Well, 95, I was 35.
Yeah, that was your age. Wow.

Speaker 1 Wow.

Speaker 8 Yeah, I'm 36.

Speaker 1 Give me my year.

Speaker 1 No, I'm sorry.

Speaker 8 And you still use the same jokes.

Speaker 1 It's the same exact jokes, yeah.

Speaker 1 Live on less than you make. A concept of Congress.
I just can't grasp. Now, I did take,

Speaker 1 I had a guy come in and train me for a year and a half on

Speaker 1 and removed a portion of my accent. So

Speaker 1 I've got a lot less accent now than I did then. That was pretty country-fried there.
Yeah, that was some Nashville.

Speaker 8 That was some 80s Nashville.

Speaker 1 Pretty southern. Pretty southern.
Sweet tea there. And the little come over thing, that

Speaker 1 little less vestige of hair. She got a little bit there.
It was still stuck on. It wasn't really a come over.

Speaker 1 Y'all all just look old in those days.

Speaker 8 Do what? Like, you look like you're 50 in that video.

Speaker 1 Isn't that interesting?

Speaker 8 Back in the day, I just feel like the way the style was, the way it was shot.

Speaker 1 The style and, you know, a suit and tie and the glasses, the Mr. Magoo glasses.

Speaker 8 Yeah. I mean, like, it just makes you, it just, it just ages.

Speaker 1 What's interesting is if you quit looking at all that stuff. That's right.
That starts

Speaker 1 to make fun of. I'm okay with that.
That's good.

Speaker 1 But

Speaker 1 what did I say? Give every dollar a name

Speaker 1 to a budget? The Every Dollar app. Now we have the Every Dollar app, and little did I know there was going to be an internet

Speaker 1 approach. This is Every Dollar.
Give Every Dollar a name and live on less than you make. And cars go down in value.

Speaker 8 People don't get rich on credit cards and car payments.

Speaker 1 Yeah.

Speaker 1 it's pretty wild yeah and 35 years later i'm still saying the same thing and i have more listeners than we've ever had before at this moment and i've not changed one thing i mean it's nothing new here

Speaker 1 it's very even the be weird element that was there why yeah you said that just be weird to be weird be weird and now now when somebody comes on does their debt free screen we call them a weirdo right and that's before it became a political thing in the last few weeks but yeah we've still been doing that oh yeah oh man they hijacked the word they they stole my word Yeah.

Speaker 1 Now I have to clarify that it has nothing to do with the principle. It's weird because you're just not

Speaker 1 normal. You're not normal.

Speaker 8 You know, it's so refreshing, though. Like,

Speaker 8 it is. There is something about longevity in life, principles in all of life.
I think it's probably true within relationships and health, money, like spiritually, all of it.

Speaker 8 That it that it works. You know, the new flashy way to do something or newest thing,

Speaker 8 It doesn't have the proven track record. It doesn't have longevity.
And the level of trust you can have in a system and a process that truly has been, yeah, for 30 years. Same,

Speaker 8 same freaking thing.

Speaker 1 Do you get tired of saying the same thing every day?

Speaker 8 For 30 years. I've been doing it for 15.

Speaker 1 Yeah. I've been half of it.
Yeah, there you go. There you go.
When we look back on this interview right now, this discussion right now, your voice is going to sound weird. Oh, yeah.

Speaker 1 I'm going to say,

Speaker 1 look at that haircut. What is she wearing?

Speaker 1 Where did she get that?

Speaker 8 That's awesome. Well done, James.

Speaker 1 Style you used to have back then.

Speaker 1 That'll be it. But the whole thing is that the truth, something that's the truth, and we're people of the book, we're people of faith, so we believe that the Bible is the truth.

Speaker 1 The truth does not change and it's not negotiable with your your feelings.

Speaker 1 And so that's why we've been able to have the integrity to say the same thing over and over and over and over again for 35 years through several fashion changes

Speaker 1 and not only survive, but continue to prosper you guys, to not only survive in the business, but be able to continue to help you guys.

Speaker 1 And it still helps you to hear those exact same things from that interview all those years ago. So we still say them over and over and over.

Speaker 1 And that is a type of integrity, to stick with something, to finish, to not quit, to not abandon every time somebody has the latest. You know, all of a sudden Bitcoin is the new answer.

Speaker 1 And so we have to stop. No.
No, it's not.

Speaker 1 It's not. All of a sudden, NTF is the answer.
No, it's not.

Speaker 8 Well, credit card points and miles.

Speaker 8 That game has ramped up.

Speaker 1 That's been majorly.

Speaker 1 It's crazy. And

Speaker 1 when we started, there were no credit cards accepted in grocery stores and there were no credit cards accepted in fast food and i remember doing a rant aghast on the air that it was going to ruin the american family that they could buy their groceries now and go into debt to buy their food and i remember going off about that um

Speaker 1 and you know

Speaker 1 Now it's not even that. Now it's just delivered to your door.

Speaker 1 Your door in particular. But yeah.

Speaker 1 Rachel hasn't seen the inside of a grocery store.

Speaker 1 No. No, no, no, no.

Speaker 8 I'll go if I have items.

Speaker 1 But for I, on Mondays, I work, and that's why I do my grocery shopping. Okay.

Speaker 1 I'm sorry. Conveniences.
Yeah. Okay.

Speaker 8 You got to give and take, people. Live like no one else.

Speaker 1 Later you can live and have your groceries delivered.

Speaker 8 I'm sorry. One thing I do for myself.

Speaker 1 One thing.

Speaker 8 When's the last time you've been in a grocery store?

Speaker 1 I.

Speaker 8 Why not since that video?

Speaker 1 Yeah.

Speaker 1 No, but entirely possible. No, No, I've been there

Speaker 1 because your mother sent me.

Speaker 1 But

Speaker 1 I think the point is that

Speaker 1 these principles work and the way that we deliver them, whether it's some it's, you know, tomorrow we may be on a hologram, I don't know.

Speaker 1 Tomorrow we may have some there's going to be another technology in five years or what we end up doing with AI to be able to we're going to use anything that's available to deliver the exact same message over and over and over again.

Speaker 8 Yeah, and I would say for people that are newer to listening, because YouTube and podcasts has become like one of the major parts of

Speaker 8 this show

Speaker 1 is

Speaker 8 just because something feels simple and kind of boring and like, oh, is that it? Really? You live on less than you make? Kind of that common sense.

Speaker 8 That's almost those are the ones to lean into, right? Like if stuff starts to get complicated and too fancy and it feels like this like, ooh, thing.

Speaker 8 So to be confident for people that are new to this, younger people even, like, it's been working and it still is. helping people get free and control of their money, which is what we want.

Speaker 1 Some of the most profound things you'll ever learn in life are easy to understand and hard to implement. Love your neighbor.

Speaker 1 Ouch, that's hard. This is the Ramsey Show.

Speaker 1 Live from the headquarters of Ramsey Solutions, it's the Ramsey Show,

Speaker 1 where we help people.

Speaker 1 Build wealth, do work that they love, and create actual actual amazing relationships.

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

Speaker 1 Daniel is in Oklahoma City. Hi, Daniel.
How are you?

Speaker 13 Hey, Dave, how are you doing today?

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

Speaker 13 Hey, got a couple questions for you. So I just recently got married about two weeks ago.

Speaker 1 Congratulations.

Speaker 13 I really appreciate it. To my wife that I met in college.
And we, you know, we talk about finances all the time and everything, you know, preparing for marriage and all that.

Speaker 13 We talked about that a lot in our premarital counseling

Speaker 13 through our church, and it was great.

Speaker 13 Big question is: so, I'm coming out of college with no debt, which is awesome, but my wife has about $130,000 in student loans.

Speaker 13 We just

Speaker 13 have been looking at them a lot recently and realized her minimum monthly payment's a lot higher than we expected it to be.

Speaker 13 It's about $1,800 a month is what that minimum monthly payment is looking like right now.

Speaker 13 So we make about $5,000 a month after taxes right now.

Speaker 1 What's her degree in?

Speaker 13 Marketing.

Speaker 1 Okay. And what does she make?

Speaker 3 Yeah.

Speaker 13 She makes about $47,000 right now with her job.

Speaker 1 A brand new job out of college.

Speaker 13 So she's actually had the job for about two years. She had been doing some marketing stuff prior to college and had a lot of experience.

Speaker 1 And what do you make?

Speaker 13 So I still have a little bit of school left. I actually make only about $25,000 a year right now.

Speaker 1 And when will you graduate?

Speaker 13 I have a year left of school.

Speaker 1 Okay. And what will your degree be in?

Speaker 13 My degree will be in business. I'm actually taking over my mom's business.
So I'll probably be making right at six figures

Speaker 1 once I'm out of school. Okay, and that's a year from now.

Speaker 13 Yes, sir.

Speaker 1 Yes, sir. All right.

Speaker 1 Okay. So

Speaker 1 your big hope is that you can just keep things afloat, and then when your income kicks in, you'll be able to plow through this pretty quick, right? Absolutely. Yes, sir.

Speaker 13 It's really just the next year.

Speaker 13 What do you think our best options are to do?

Speaker 1 Side hustles. And she's underemployed.
Why is she not making more than that?

Speaker 13 You know,

Speaker 13 it's a big conversation that we have had lately. She's actually in the process of looking for a new job.

Speaker 1 I would guess she could probably add $20,000 or $30,000 to her income, don't you?

Speaker 13 That's about what the median is. It's about $20,000 to $25,000 more

Speaker 13 here in Oklahoma City. So hoping she can find a better job that can make a little bit more money.

Speaker 13 But her job right now is nice. It's very flexible.

Speaker 1 But that's a big thing.

Speaker 8 Yeah, I wouldn't be looking for flexibility at this season, right?

Speaker 1 Yeah.

Speaker 1 Absolutely. Absolutely.

Speaker 8 Yeah, I mean, I think you guys just have a couple of months until some stuff is really going to start opening up for you.

Speaker 8 I mean, if I were her, I'd be pretty aggressive at finding a new job because that's going to be significant, right? At $25,000. And then a year from now, you'll be working full-time.

Speaker 8 Are you able to plug in more to your parents' business, Daniel?

Speaker 1 So

Speaker 1 now

Speaker 13 that's what I'm actually doing. I'm working for her on the weekends and then a little bit during the week.

Speaker 1 I'm just traveling for her and stuff.

Speaker 13 So that's how I'm making about $25,000 a year.

Speaker 1 See, if she increased her income, like we're talking about, it would be about the equivalent of the student loan debt. Yeah, that's about what we were thinking.

Speaker 13 Yeah.

Speaker 1 $1,800 is like $23,000. So that, that's, you know, you'd be right there.
Okay. So

Speaker 1 yeah, that's.

Speaker 8 And I would say, Daniel, and I'm sure people, maybe if you've talked to them about this, but can I just, I just want to say that you're in like the perfect season

Speaker 8 relationally wise, like with marriage, no kids. You guys are starting out.
Like if they're, if you're going to be working extra hours, this is the time to do it. It gets more complicated, right?

Speaker 8 The longer you're married. And if kids start entering the picture, it just becomes more weighty.

Speaker 8 And so if you guys can really make a plan and just dream, I would have fun and just say, okay, what if she made 25,000 more? I'm making 100 grand.

Speaker 8 How fast can we get this paid off if I'm making that in a year? And kind of map it out. And you guys are able to see it.

Speaker 8 So that way, if you guys have to take on extra work for the next two to three months until her income's up, just to keep that, you want to keep that minimum payment for sure.

Speaker 8 Because these payment plans on the principle of specifically with student loans, I mean, people pay so much money and then they look and they owe more than where they started.

Speaker 8 I mean, it's just, it is so.

Speaker 1 I'm not even looking at the monthly. I'm thinking

Speaker 1 her income goes up by $25,000. Your income goes up to $100,000.
That puts you at $175,000 a year income. You owe $130,000.
You should do this in one year.

Speaker 1 That went from the time that that happens.

Speaker 1 I mean, and that's a year from now so yeah and then during the year in the interim just hang figure out a way to pay the payment maybe a little more any side hustles get after it though peter is with us in austin texas hi peter how are you

Speaker 5 i'm great dave thanks for taking the call sure what's up

Speaker 5 I had a quick question. I have 90% of my wealth.
I just turned 62, 90% of my wealth in my Roth IRA.

Speaker 5 And I've kind of gone down a path where I've been doing it all in private lending, doing private notes, but 150 average.

Speaker 5 I'm only doing firsts, and I'm at 55% or less in loan to value, and I'm getting 12.5% right now, and I like that.

Speaker 5 But I'm wondering what risks may be associated with that, and if I should diversify that as I keep the money there.

Speaker 1 You

Speaker 1 spit that out in such a way that it makes me believe you do actually know what you're doing. Most people don't in that world, but I think you probably do.

Speaker 1 So that doesn't bother me. So what is the risk on 55% L T V mortgages that you're holding only if the bunch of real estate collapsed and you became the owner of it, right?

Speaker 1 Yes. That would be your only risk.

Speaker 1 That's not a real high risk, I think.

Speaker 1 What's the average

Speaker 1 loan size?

Speaker 5 I'm doing anywhere.

Speaker 5 Average would be 185 right now.

Speaker 1 Okay. All right.
So you're not sitting on $2 million ones and that kind of, What's the total?

Speaker 1 The total portfolio?

Speaker 5 Approximately 2.6.

Speaker 1 Okay. So you're just doing a self-managed IRA, got it in a Roth, and you're rolling this money over in private lending.
Wow. That's pretty cool.
That's what I've been doing.

Speaker 1 Yeah, that's what I've been doing. It's like your job, too, almost.
Yeah.

Speaker 5 It is, but when you have them going and they go for anywhere from, let's say, three years is the average with a nice prepay.

Speaker 1 Yeah. They come back in early

Speaker 5 as well. And I'm trying to simplify my life and be simple.
And I have a little bit of fear of the stock market and feel that 2.6 million coming in each year.

Speaker 1 I don't have any fear of it, but I don't have any fear of what you're doing either. So if you want to, I mean, diversification equals lowered risk, always.

Speaker 1 I love real estate, and I'm heavy in real estate. I'm probably, I don't know, 80%, 90% of my net worth is in real estate.

Speaker 1 But I love it. I'm comfortable with it.
I know what I'm doing. It's not a, so I have very little risk associated with that.
But I've got a, you know, then I've got a bunch in

Speaker 1 a lot in the stock market in mutual funds. And so,

Speaker 1 but, um, and I haven't done what you're doing, but because

Speaker 1 the amount of effort it would require, I'm not willing to put in.

Speaker 1 So, yeah, there's nothing wrong with being heavy in something you're good at and no. That's my point.
So I'm not panicked about where you are.

Speaker 1 But always, it's a good question to be asking yourself, should should I diversify more? That's a good question to constantly look at and go, all my eggs in one basket.

Speaker 1 The Bible says, put your portions into seven, yes, to eight, for disaster may come upon the land. Diversification is in Ecclesiastes.
This is the Ramsey Show.

Speaker 1 Rachel Cruz, Ramsey Personality, is my co-host today. Thank you for joining us.
Today's question of the day is brought to you by Y ReFi.

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Speaker 1 R-E-F-Y.com Ramsey might not be in all states.

Speaker 8 All right, today's question comes from Robert in Texas. My wife and I put

Speaker 8 our children through college, bought them cars, and provided them for them until they moved out.

Speaker 8 To this day, we still pay their phone bills in spite of our oldest child is a doctor, and our youngest is a manager for a high-end retail company. Both earn six-figure salaries.

Speaker 8 Due to unforeseen circumstances, we were hit with two natural disasters last year: a flash flood and a fire to our home.

Speaker 8 We didn't have flood insurance, but we're able to cash flow the repairs for the flood and are deductible for the fire.

Speaker 8 We currently only have three debts, two vehicles, which replace the ones that we lost in the flood, and our mortgage is $47,000.

Speaker 8 Even though our children earn four to five times what we make, they say, according to your teachings, in parentheses, they have no obligation to help us.

Speaker 8 They have told us, well, dad, Dave Ramsey says to allow you to sink or swim because your debt is your obligation.

Speaker 8 Are we wrong to ask them for help or are they

Speaker 8 interpreting your advice incorrectly? Hmm.

Speaker 1 Wow.

Speaker 1 Okay.

Speaker 8 It doesn't sound like they're sinking.

Speaker 1 I mean, the first thing is

Speaker 1 it's weird when you pay your grown kids bills of any kind, including their phone bill.

Speaker 1 And you know whose fault that is, Robert? Yours.

Speaker 1 You should have cut that off when they left home. I don't pay Rachel's dad gum phone bill.

Speaker 1 I don't pay her Netflix bill.

Speaker 8 Denise does have those Netflix passwords, though.

Speaker 1 Well, I didn't give it to her. Besides the point.
That's not the point.

Speaker 1 So that's thing one. Thing two, Robert, when you raise children, and as part of raising them,

Speaker 1 you buy them a car and pay it for their college, and when they leave college and they become successful adults, that does not obligate them.

Speaker 1 They're not in debt to you. That was like your job.
You're the dad. That's what you're supposed to do.

Speaker 1 You know, well, I changed your diaper, so you need to send me to France on a vacation. What? I've heard this crap my whole life.
I do not understand it. Okay.

Speaker 1 Your children are not obligated to any of you because you did your job as a mother or a father. They are not in debt to you because you fed them.

Speaker 1 Period. So the entitlement that is dripping through this, Robert,

Speaker 1 you know, my disgust with your entitlement, yes, that is my teaching. It's a disgusting entitlement that you should think that your children owe you something because you were just simply a father.

Speaker 1 and did what you were supposed to do. My children are not obligated to me.
Now,

Speaker 1 I have never said,

Speaker 1 Dave Ramsey says, allow you to sink or swim because your debt isn't our obligation. That is not a phrase.
That's not phrasing and verbiage that I would use.

Speaker 1 So either your children have added drama to what I say or you have. I'm not sure who.

Speaker 1 What I would say is, is it's not their job. to take care of their mom and dad.
They're not morally or ethically obligated to do that.

Speaker 1 Now, if they are able and mom and dad are in a pinch pinch and they want to give mom and dad some money because they're somebody that I love and they're hurting, I've never said not to do that, but that's way different than being obligated

Speaker 1 by the fact that you simply did your job as their dad. That's different.
Okay.

Speaker 1 So if you have car debt, it's not because of the flood. You had car insurance that would have replaced your car in a flood.
Flood insurance is on the real estate. It's not on the cars.

Speaker 1 So you cash flowed the repairs for the flood and the deductible for the fire because you had insurance on the house for the fire.

Speaker 1 And we only have three debts, two vehicles, which replaced the ones lost in the flood. No, they didn't.
You bought cars that were nicer than you had in the flood. And that's why you're in debt.

Speaker 1 You upgraded after the flood because you got a check from the car company on your car insurance when you lost the cars in a flood.

Speaker 1 And oftentimes, when people lose a car or get a car totaled, they for some reason use that as an excuse to upgrade and go into debt when they weren't in debt before.

Speaker 1 I do not understand, but people do that like you did all the time, Robert. So that's not, none of this is your children's fault, and none of that is a natural disaster.

Speaker 1 You actually cash flowed through the two tragedies. Congratulations.
And then went and got you a couple car payments to celebrate.

Speaker 1 So

Speaker 1 they are not obligated to pay your car. They are not obligated to do this.

Speaker 1 Because they make six figures and you once gave them some food.

Speaker 1 They're just not. That is not how life works, buddy.
So, but sink or swim,

Speaker 1 we're not that harsh about it. I just want to draw a line.

Speaker 1 Charity that is extracted through guilt is not charity.

Speaker 1 If your children want to be charitable towards you and give you something, that's wonderful. They've got money.
They've done well. Mom and dad just got a little mortgage, a couple car notes.

Speaker 1 We're going to reach over and knock them out just because we love mom and dad, but not because mom and dad think they're entitled to their money.

Speaker 1 There's a difference.

Speaker 8 Yeah. And he sounds a little resentful in some way.

Speaker 1 Yeah.

Speaker 8 Even though they earn four to five times what we make, you know,

Speaker 1 and Dave Ramsey says, just tell you, sink or swim. You know, it's like, oh, brother.

Speaker 1 There's a little bit of

Speaker 1 Roberts.

Speaker 1 I bought their cars. I bought their cars, bought their books, and sent them to school.

Speaker 8 This is always

Speaker 8 a hard line for me, the adult-child-parent conversation, because we get this a lot, that the parents are struggling and the adult children are able to help.

Speaker 8 And even vice versa, right? The parent has an adult child that needs help, right?

Speaker 8 That's always a hard boundary for me to navigate because it is so situationally specific,

Speaker 8 maturity-specific, relationally specific. I mean, there's just so much.

Speaker 8 Yeah, I mean, there's so many elements of it that can go quickly one way or the other.

Speaker 1 But

Speaker 8 what is A, in this case,

Speaker 8 when

Speaker 8 okay, so a parent should never expect their child to help them.

Speaker 8 But there is something honoring in about, you know what I'm saying? Like, like, what's that? Taking care of

Speaker 8 because it's a cultural thing, too. In America, we're very independent, though.
You go to other cultures and it's a, when you bring mom and dad home, like, it's a generational.

Speaker 1 We are in America. So that's where we are.
We are. That's where we are.

Speaker 8 But I'm not saying we're right either.

Speaker 1 So I'm curious. Yeah, we are.

Speaker 1 Don't be judgmental, be curious.

Speaker 1 Here's the thing. Here's the thing.
About Whitman. So the proper thing is Robert

Speaker 1 goes and says, hey, we need some help. Can y'all help us? Yeah.
Not

Speaker 1 your children should give you money because you gave them cars and bought them books and sent them to school. Yes.
The entitlement versus the request in love. Yeah.
Those are two different things.

Speaker 1 Yeah.

Speaker 1 But this is dripping in bitterness like they owe him something. And that is not

Speaker 1 the, that's not, that's a non-starter.

Speaker 1 The second thing is, if you're going to help someone, particularly someone you love, particularly someone you love inside your family, you should help them in a way that causes them to reach sustainability on their own, not become dependent upon you.

Speaker 1 And so if you reached over and paid off the house and paid off the cars, it would be mom and dad. You're getting on a budget.

Speaker 1 You're going through Financial Peace University so that you can live on your money for the rest of your life. And this is just going to give you a little smoothie.
Jumpstart. Yeah.

Speaker 1 It's going to give you a jump start. So even when we're helping, like your sister runs our family foundation and we're helping someone that's in a poverty situation.

Speaker 1 We don't just throw endless money at a poverty situation. We throw money in a way.
in a way that causes the person to step up out of poverty and stay out.

Speaker 1 We're the lift out,

Speaker 1 but we're not the keep them in. Yeah.
Check. I don't want to keep them in the, I don't want to be the one writing check, allow somebody to stay in it.
So we're not enablers.

Speaker 1 And that's the thing you got to get to when you're on the giving side of this.

Speaker 1 This is the Ramsey Show.

Speaker 1 Rachel Cruz, Ramsey personality, number one best-selling author. My daughter is my co-host today.
We invite you to stop by Ramsey Solutions. We do this show on the glass in our lobby

Speaker 1 Monday through Friday from 1 to four there are two of us sitting here every day for three hours answering questions and it turns into a radio show a podcast a a youtube show all at once you can come and sit and watch and uh you know watch the show unfold the uh homemade chocolate chip cookies in the baker street cafe are free the home the wonderful coffee is free and um

Speaker 1 You know, we'd love to have you stop by. We're just a little south of Nashville in a wonderful little town called Franklin, Tennessee.

Speaker 1 And so so make that a part of your trip if you're ever cutting through here. And we come out at the commercial breaks and take pictures and sign books and get to meet you.

Speaker 1 And we love getting to see you. In that lobby, we also, right here across the glass from us, installed the debt-free stage, which is where Chris and Jennifer find themselves.
Hey guys, how are you?

Speaker 1 Good. How are you doing? Welcome, welcome.
Where do y'all live? We're in Raleigh, North Carolina. Love it.
What a great town. And how much debt have you two paid?

Speaker 12 We have paid off $500,000.

Speaker 1 Whoa. Wow.
How long did this take?

Speaker 12 About six years.

Speaker 1 Good for you. And your range of income during that time?

Speaker 12 We're in real estate. It varies.
We started out in different careers. So it was around 200 at the time.
And then, you know, we're anywhere between $500,000 and $550,000.

Speaker 1 Whoa. Doing great.
Way to go, you guys. Thank you.

Speaker 1 All right. So I'm going to guess and say that might be your mortgage, and you paid off your house.

Speaker 12 We are on baby step number seven.

Speaker 1 Yeah.

Speaker 1 Looking at a couple of weirdos. A A debt-free couple, house and everything.

Speaker 1 Absolutely. How old are you two weirdos?

Speaker 1 I'm 47. Uh-huh.

Speaker 12 I'm hanging on to 49. I will be 50 this year.

Speaker 1 So,

Speaker 1 in a paid-for house that's worth how much?

Speaker 12 About $1.3 million. I love it.

Speaker 1 And how much in your nest egg?

Speaker 12 We have about 60% in real estate and about 40%

Speaker 12 in IRAs, 401ks, investments, things like that.

Speaker 1 So about $3 million. Total net worth.

Speaker 1 Way to go, steps millionaires. I'm guessing you didn't inherit any of that.
We didn't. Not a dollar.
You've had a fabulous income and have done a great job with it. Way to go, you all.

Speaker 1 Great job, you guys. Way to go, heroes.
All right. Now you're 50 years old, $3 million net worth, zero debt in the world, making a half million a year.
Debt, come, man.

Speaker 1 Who wouldn't want to be you two?

Speaker 1 Wow. How's that feel? It's weird.

Speaker 1 I know. We talked about it.
We thought we were going to have this feeling when we accomplished it.

Speaker 1 And it is a wonderful feeling, but we're just overachievers. So now we're like, what do we do next? What's our next?

Speaker 8 You're moving on to the next thing.

Speaker 1 Yeah, you are overachievers.

Speaker 1 What are you going to do to celebrate, big? We're here. Oh, come on.
I'm something big.

Speaker 12 We are going to do, we're going to go on the bourbon tour in Kentucky a little bit later this year.

Speaker 1 We've never been to Kentucky.

Speaker 12 We thought it would be something cool to do with our friends. And we're big tennis players, and it's our tennis community.
We're going to go do that.

Speaker 12 And it's going to be kind of a quiet quiet celebration. So we're

Speaker 1 if you fill the trunk with bourbon and you go across state lines, we call that whiskey running. So

Speaker 1 head back over to Raleigh with a whole trunk. But you don't know bourbon.

Speaker 8 Yeah, you don't know what that is.

Speaker 1 I don't know anything about that. I've never known anyone that did anything like that.
Way to go, you guys. Congratulations.
Thank you.

Speaker 8 Thank you. That is so fun.
So six years ago, what made you guys, I mean, because you're doing fine. You could have just kept the mortgage on, you know, for 30 years or whatever it was.

Speaker 8 What made you want to just get rid of it six years ago?

Speaker 1 Well, ironically

Speaker 1 we had talked about achieving this goal and then I was working from home and Chris came home for lunch and he was like I think I'm gonna get laid off today and I said what you're gonna get laid off today he said yeah I think I'm gonna get laid off today

Speaker 1 I said that's crazy he went back to work came home at four o'clock he was laid off

Speaker 1 so he was a biochemist before and I was a professional fundraiser and he had gotten his real estate license and it's a passion of ours and that terrible moment in our life really spurred things forward for us to take that step and trust in ourselves and throw ourselves into real estate.

Speaker 1 And then once the business got up and going, then I left my career and joined with him. And we've never looked back.
So

Speaker 1 that's a different biochemistry straight into real estate is not something I sign up for every day.

Speaker 12 I get that a lot. So, yeah,

Speaker 12 I did the corporate world. I was in big pharma for about 20 years.
I did anything from drug development, you know, had a quality control.

Speaker 12 You know, we made vaccines. We made flu vaccine in my last job.
And, you know, just we were kind of talking about it at lunch.

Speaker 12 You feel like you're held back a little bit and you could just be doing more. And I always wanted to own my own business and just kind of try that.

Speaker 12 But, you know, you've got a salary, you've got benefits, you've got that security. You're a little scared to go make that jump.

Speaker 1 So they helped you. They helped me.
Yeah. And

Speaker 12 it didn't feel like it at the time, you know, but we went ahead and we talked about it. We did it.
We made the decision. We worked with a smart vestor pro in Raleigh, Brand Spessart, and he's been

Speaker 12 super, super supportive this entire time. He actually pushed us to kind of get this house paid off.
And I called him. He's the first person I called.
I said, hey, I'm scared. Can I do this?

Speaker 12 I'm leaving everything. Can I do this? And he goes, absolutely.

Speaker 12 I'll put you in touch with the right people. And honestly,

Speaker 12 the day that I went and quit my corporate job,

Speaker 12 I got laid off, but I was doing some contract work until I got the business up and going. But until I jumped into full time, I literally went in, resigned.
The next day, Jen lost her job.

Speaker 1 Oh, my gosh.

Speaker 1 Oh, yeah.

Speaker 12 Re-org.

Speaker 1 I mean, re-org, reorg the family. Yeah.

Speaker 12 It happens, but it's one of those things that's probably the best thing that could have ever happened to us. And it launched us to get here.
And it's just one thing after another.

Speaker 12 And that's why it took six years. You know, we

Speaker 1 were really comfortable, and God made us uncomfortable in the best way.

Speaker 8 For sure. So part of the motivation of selling the house is just to remove risk as well.
Like if it's just this feeling of I'm not selling it. Oh, I'm sorry.
I'm sorry. Paying it off.

Speaker 8 That's what I meant. But just the idea of, oh my gosh, like we, it made you that much more motivated to get the risk out.

Speaker 1 Is that right? 100%.

Speaker 12 Yeah. Just because, you know, there's so many factors in real estate we can't control.
Interest rates, you know, the economy, people losing their jobs like we did. There's just so many unknowns.
And,

Speaker 12 you know, I expected to pull into the driveway and there'd be fireworks going off and, you know, hey, you're celebrating. But it wasn't like that.

Speaker 12 But I actually, a couple of days after that, I had a deal that was going south. and I remember it was just this calm and this peace.

Speaker 12 I didn't have any concerns, it was okay, and it was it worked itself out. You know, I mean, nothing really fell apart, but in that moment, I was like, oh, this is what he's talking about.

Speaker 12 You know, when you don't have that stress and you don't have to be, you know, burdened by debt, it's just unreal. And our friends have just been so supportive and family this entire time.

Speaker 12 It's been great.

Speaker 1 Yeah, it's awesome, you guys. Amazing.
What do you tell the key people the key to being 100%

Speaker 1 debt-free and having a $3 million net worth at 50 years old is.

Speaker 1 I think it's not living like the Joneses. You know,

Speaker 1 I made the comment to one of my friends and I said, there's no handbag or shoes or anything that's worth the feeling that you get from being debt-free.

Speaker 12 And I think mine would be surround yourself by friends and family that support you. I can't tell you how many people over the years go, why would you want to pay off your debt or your mortgage?

Speaker 12 Can't you take that? Can't you invest it? And I just knew that we were in the wrong circles, right? So we surrounded our friends and family you know, and and

Speaker 12 where we're at in Raleigh, and it was just, it was a great feeling. They all supported us and they understood what we were trying to do.
And

Speaker 1 it's just been a great experience. You know, that's an interesting way of looking at it.

Speaker 1 I've done that too, and I never thought about it, but it's like, if you're going to sit and tear down my plans and tear down my dreams just because you're that person, you just opted to the back row of my friend list.

Speaker 1 Exactly. Correct.
Exactly. And

Speaker 1 you get to sit on the back row because I'm not putting up up with that crap. I want the cheerleaders up here on the front.
Now, I don't mind somebody telling me the truth if they're concerned.

Speaker 1 That's different than just negative ninny.

Speaker 1 But negative ninny can opt to the back row, right?

Speaker 1 Yeah, we've had so many people tell us that we should use that money, we should leverage it, we should buy other businesses, do all these things, but that's not our goal. That might be their goal.

Speaker 1 It's not ours.

Speaker 1 Hey, not everybody goes from biochemist to real estate agent to whiskey runner. That's right.
All in one fell swoop. I'm just saying.
That's right. Not everybody can do that.

Speaker 1 So way to go, you guys. I'm very proud of you.
Thank you.

Speaker 1 You look like life is great. You guys got like a great picture right here.
It's awesome. Very, very cool stuff.

Speaker 1 All right. It's Chris and Jennifer, Raleigh, North Carolina.
500K paid off in six years. Making 200 to 550.

Speaker 1 And a $3 million baby steps

Speaker 1 millionaire net worth in the process. Count it down.
Let's hear a debt-free scream. Three, two, one.

Speaker 1 We're dead free.

Speaker 1 Woohoo!

Speaker 1 That is how it's done, ladies and gentlemen. You got to love it.
This is the Ramsey Sheriff.

Speaker 1 The best way to make the most of your money is to make your money do what you want it to do instead of wondering where it went. Tell your money what to do instead of wondering where it went.

Speaker 1 Most people in this life

Speaker 1 live

Speaker 1 reactively.

Speaker 1 But people who are proactive, who happen to things intentionally, are the ones that we call successful people.

Speaker 1 In the wealth building world, if you're going to happen to your money, you do that with a budget. And every dollar is the budget that'll help you do it.

Speaker 1 It's the app that's free in the App Store and Google Play. Download every dollar.

Speaker 1 Get the premium version while you're at it and start working with your spouse, working the baby steps, working paycheck planning. There's all kinds of tools inside this thing.

Speaker 1 They're going to help you do the Ramsey system more efficiently and it really sets it up to win. Go to everydollar.com or download the Every Dollar app for free in the App Store or Google Play today.

Speaker 1 Dorothy is with us in Fort Myers, Florida. Hi, Dorothy.
How are you?

Speaker 14 Hi, David. Hi, Rachel.
Thank you for taking my call. And I'm in Naples, just so you know.
Okay, Cool.

Speaker 1 How can we help today?

Speaker 14 Well, I unfortunately am a widow. My husband committed suicide last year.

Speaker 1 Oh, my gosh. Sorry.

Speaker 14 And I would really appreciate it if you'd let me borrow your Magoo glasses to see my way through my mess.

Speaker 1 I'm so sorry. Wow.
Me too.

Speaker 14 Me too. It was certainly something that we weren't expecting.

Speaker 4 And now I'm, you know, I have a lot of debt and I want to get rid of it.

Speaker 3 And I have some very specific questions for you.

Speaker 4 One of them is I have

Speaker 6 an IRA that has some money in it that was part of his, you know what the drop is?

Speaker 1 Have you heard of that term? How much is in the IRA?

Speaker 14 It's not a lot. It's about 40 grand.

Speaker 1 About 40 grand.

Speaker 14 And it's not invested in anything that's earning us and earning me anything.

Speaker 1 How old are you?

Speaker 14 I'm 57.

Speaker 1 Okay. And what is your career?

Speaker 6 I don't have one.

Speaker 14 My husband wanted me to be his playmate when he retired.

Speaker 6 And we had a granddaughter who was born with some complications.

Speaker 14 And so I stopped working to help, you know, get her through that. And he just did want me to go back to work.
So I didn't.

Speaker 14 And so we played and we accumulated a lot of stuff. And I know I can sell that stuff to get into into a much better financial situation and it's just taken some time to kind of sort through.

Speaker 1 Sorry.

Speaker 7 To kind of sort through everything and I wasn't expecting to get emotional

Speaker 14 sort through everything and get some clarity in all of it, you know.

Speaker 14 So I know I need to get a job. I do know that.

Speaker 3 And I want one and I've already started looking for one and it's kind of hard not knowing what to do because I have no technical skills whatsoever because I've been out of work for so long.

Speaker 14 I'm a personal person, so I know, you know, like customer service and things of that nature, I should do pretty well at.

Speaker 14 So I plan on doing that right away, and I plan on selling several assets right away.

Speaker 3 It's just taking me some time to get there.

Speaker 14 I already downloaded your Every Dollar app and so I'm working with that right now.

Speaker 1 What is the most pressing thing you have today that we can help you with?

Speaker 4 Well,

Speaker 14 I still have our two trucks that I have payments on,

Speaker 14 and I have some credit card debt.

Speaker 14 And that was one of the questions I wanted to ask you.

Speaker 1 Do you have any cash other than this 40K?

Speaker 3 No, sir.

Speaker 1 Okay.

Speaker 1 How are you paying light bill and food bill and all that?

Speaker 14 His pension.

Speaker 1 I get it.

Speaker 4 Yeah.

Speaker 14 And that's supposed to be a bad thing.

Speaker 1 How much is his pension?

Speaker 6 A year or monthly.

Speaker 14 Monthly, it's just under $5,500. And for annual, it's like $65,090.

Speaker 1 And how much is your house payment?

Speaker 14 My house payment is $1,900.

Speaker 1 I always pay $2,000. And how long does the pension last?

Speaker 14 The pension is going to end in less than five years.

Speaker 1 Okay.

Speaker 1 Good. So we've got a really good plan here.
You can survive monthly. You can survive and have been monthly on the 55 with the every dollar budget.
That's very possible. We may or may not use the 40.

Speaker 1 We'll see. Prefer to wait till after 59 if we can.

Speaker 1 And you're going to get rid of the truck payments by getting rid of the trucks and getting you a car you can afford. And you're going to start the next chapter of your life.
You're a wee 57-year-old.

Speaker 1 You have a lot left.

Speaker 1 lot left. This is your chapter two.
This is act two.

Speaker 1 After the curtain comes back up, we took a bow. It's an encore.
Didn't turn out like we thought it was going to.

Speaker 1 The story takes a twist, a rather tragic turn, and the heroine steps forward with her shield and her sword. Okay?

Speaker 3 Thank you. Thank you.

Speaker 1 That's you. That's where you're going.

Speaker 1 And so what's going to happen is three years from today, you're going to be booming as the biggest real estate agent in Naples or whatever it is you choose to do. Okay.

Speaker 1 And you're going to be laughing about this little tiny pension, but it survived you. It sustained you when it should have, and that was good.
But it's certainly not your future. You are your future.

Speaker 1 Okay.

Speaker 1 Right?

Speaker 1 Mathematically, you are. Emotionally, you are.
Spiritually, you are.

Speaker 13 Yes.

Speaker 1 Financially, you definitely are.

Speaker 1 So

Speaker 1 you're the secret sauce to the equation, and you're up to it. You can do it.
I can tell by talking to you. I mean,

Speaker 1 you're hurting, but any normal human would be hurting with what you've gone through, honey.

Speaker 1 But I think there's a lot going on inside Dorothy. So

Speaker 8 how much debt, Dorothy, you mentioned that you guys kind of just traveled and bought stuff and racked up some debt. I'm just curious, what all is the debt? How much credit card debt is it?

Speaker 6 I have about

Speaker 14 actually $18,306.38.

Speaker 8 Okay. And what other debt is there?

Speaker 14 I have the house is just a little over $100,000. That'll be under $100,000 after September's payment.

Speaker 14 I have two trucks totaling $21,000

Speaker 14 and an RV that's at $15,000.

Speaker 1 So the trucks and the RV are gone. I'll get you a reasonable car.

Speaker 8 But that's it, right? Okay.

Speaker 1 And then we're going to

Speaker 1 plow through the credit cards. Is there anything else?

Speaker 6 The credit card,

Speaker 1 no.

Speaker 6 I mean, just monthly payments, of course.

Speaker 1 Yeah. Yeah.
Yeah.

Speaker 1 All right. Here's what we're going to do, okay? I'm going to load you up with homework.
Are you ready to go to school?

Speaker 1 Yes, sir. All right.

Speaker 14 Can I ask you one more quick question? Yes, ma'am.

Speaker 14 No, I'll wait till you're done and then maybe I'll.

Speaker 1 Oh, you go ahead. Go ahead.
Go right now. Well,

Speaker 3 I had already taken one of the credit cards and put it on a 0% for 18 months,

Speaker 14 and I'm plugging away at that one. The other one has an interest rate.
It's the one that's only at $6,000.

Speaker 14 Would it behoove me to transfer that to a 0% for 18 months?

Speaker 1 It doesn't matter. You can if you want.
You can if you want, but that's not your problem.

Speaker 1 Your problem is getting the income up and having your future lined out. And once you see that, then you can turn up the heat and just get rid of them.

Speaker 1 And the interest rate doesn't matter when you're paying aggressively on them. So if you want to, it's okay.
But it's not really the answer to your situation at all. So hold on.

Speaker 1 Christian's going to pick up. We're going to put you into Financial Peace University.
We're going to provide you with a financial coach, all as our gift.

Speaker 1 Okay, we're people of the book, and the book instructs us to take care of widows and orphans. And we will do that today.
Okay?

Speaker 1 So you're going to get that i'm also going to send you ken coleman's book the uh find the work you're wired to do it has in it an assessment i want you to take the assessment i want you to start the process of uh dreaming about what the new future looks like for dorothy what is it you want to be when you grow up you're just a wee 57 year old just a tiny little you can do it you can do it and uh dorothy and i'm so proud of you can we just say too you haven't messed anything up when people go through tragedy we even tell them just to pause yeah for even a year, right?

Speaker 8 So like you, you've, you're not behind all of it. I know it probably feels very overwhelming, but you've done the right thing.

Speaker 1 Hey guys, if you're I'm sorry, if you if you want to hear the next 40 minutes of the show, it's on the Ramsey app, the Ramsey Network app.

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Speaker 1 If you want to listen to all three hours or watch all three hours, you can always do that on the Ramsey Network app. It's completely free.
It doesn't cost you a thing.

Speaker 1 So the last 40 minutes of the show now, if you're on talk radio, it's still there, right where it always has been.

Speaker 1 But if you're on podcast or YouTube, it's on the Ramsey Network app in the App Store or Google Play. It's completely free.
This is the Ramsey Show.