Stop Excusing Debt as a Dream

Speaker 1 Brought to you by the Every Dollar app. Start budgeting for free today.

Speaker 1 From the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual, amazing relationships. I'm Dave Ramsey, your host, Dr.

Speaker 1 John Deloney, Ramsey personality, number one best-selling author, PhD in counseling, and host of the Dr. John Deloney Show, a big hit on the Ramsey Networks.
He's my co-host.

Speaker 1 Open phones at 888-825-5225. Danny is in Orange County.
Hey, Danny, what's up?

Speaker 2 Hey, Dave, big fan, first and foremost.

Speaker 3 Big fan of

Speaker 3 Mel.

Speaker 4 Thank you.

Speaker 5 I just have a quick question here.

Speaker 2 So I've been married with my wife for about 10 years at this point.

Speaker 3 It's living up over 10 years, milestone.

Speaker 2 Really happy about that. But

Speaker 2 I don't think we're on the same page on finances.

Speaker 3 And so recently we had this hard conversation where I

Speaker 2 told her I want to get

Speaker 2 a different account so that I can manage the money a little better.

Speaker 3 She's been

Speaker 2 She's been managing the finances for the amount that we've been married.

Speaker 2 But at this this point, we're earning a lot more than what we did when we first started. You know, when we first started.

Speaker 1 So how did the conversation go after you told your wife she sucks at this?

Speaker 2 She didn't really say much. I just

Speaker 6 hope you don't take this.

Speaker 2 Yeah, she's,

Speaker 2 I said, I hope you don't take this into, you know, with any offense, but I think it's my step to take.

Speaker 1 Right.

Speaker 2 And she just stood quiet and we kind of went on with it. And so I said, I'm going to look into it.

Speaker 2 And I just, I've been looking for which would be the best bank to open a new account with, but I haven't really done it. And yesterday I, you know,

Speaker 2 going through

Speaker 5 the different credit cards that we have and coming to find out that

Speaker 2 one of our credit cards is back, you know, into the debt.

Speaker 2 And so I guess to give you a little bit more context, we tried doing the second baby step, the snowball effect, and we were doing well.

Speaker 1 No, we weren't, you were, and she was doing whatever she wanted.

Speaker 10 That's true. Yes.
I'll say.

Speaker 11 What is she so bad at that brought you to a point where you sat down and said,

Speaker 11 I need to I feel so unsafe with our family finances, I need to get our own my own account.

Speaker 2 So I'm earning now six figures, which you know, she's been a great a big part of, you know, she supported me and now I'm earning 110K on a yearly basis.

Speaker 11 I'm tempted to stop you right there and just say y'all are earning six figures.

Speaker 2 Okay. Yeah, that is correct.
We are earning 110, and she has a part-time, so she brings in about 20K a year with the little part-time that she has.

Speaker 2 And so we're doing a lot better than what we used to. And

Speaker 2 we're still kind of living paycheck to paycheck even with

Speaker 11 you know our our rent i know i know but here's what i'm i'm asking what is what does she do

Speaker 11 now that y'all are making a hundred and thirty grand a year together

Speaker 11 what has she done that has

Speaker 11 has told you you need to protect this family by getting money away from her and handling it all yourself

Speaker 11 um

Speaker 2 like i said so i trusted that the finances would go i guess good, but she's even

Speaker 2 had to use a credit card to pay our rent.

Speaker 1 That tells me y'all don't have a budget, dude.

Speaker 11 Like, it tells me y'all have good ideas, but y'all aren't sitting down on the same when you stay on the same page, like y'all sit down at the beginning of every month and decide, here's what's important to us, here's what we have to do, and then here's the debts we're going to pay off in this order.

Speaker 11 And if y'all aren't having that conversation,

Speaker 11 we hear from people all the time who make way, way, way more money than you, but they're still in a mess financially.

Speaker 11 So it's not fair to say, or it's not honest to say, quote unquote, we're doing better. You're making more money, but if y'all are still spending like wild, you're not doing any better.

Speaker 1 You're fixing the problem with the wrong tool, honey.

Speaker 1 The tool of opening a separate account is not going to fix the problem. It's going to make it worse.
So here's what we need to do instead, okay?

Speaker 1 You called to ask, so we'll tell you, because we love you.

Speaker 1 83% of the millionaires that we have surveyed, this is actual data, say that they work hand in hand as teamwork with a cooperative spouse towards our dreams.

Speaker 1 Less than 50% of the general public say that, and they're not millionaires as a result. So what we know is that couples that work together on their finances in detail,

Speaker 1 one of them being more nerdy, one of them being more of a free spirit, one of them being a saver, one of them being a spender, but they have an agreement on the goal and an agreement before the month begins on the steps we're going to take with our money this month towards that goal.

Speaker 1 Those couples that are aligned end up with two things, longer, happier marriages and a higher probability of building wealth. Separate accounts works against that, not with that.

Speaker 1 And so you're harming your future relationship and you're harming your probability to build wealth if you go the route you're asking about. So I'm going to beg you not to do that for your sake.

Speaker 1 Now, what do we do instead?

Speaker 1 Instead, we're going to put you on the every dollar budget and you're going to go and apologize to your wife for insulting her after she's been doing the bills for 10 years, and now you woke up because you're making a little bit more money and decided you didn't like the way she's doing it.

Speaker 1 Before that, she was fine. She was on her own.
And, you know, no, that's not okay. So I'm sorry I insulted you.

Speaker 1 You were doing the best you could, and I was trying to do something else, and I was wrong where I was going.

Speaker 1 So instead, honey, what we're going to do is we're going to sit down and we're going to do this together.

Speaker 1 We're going to put in the Every Dollar app every dollar of our income before the month begins. There will be no more credit cards.
There will be no more debt.

Speaker 1 And we are going to use this wonderful income that we have to build a wonderful life and a wonderful future. And so we're going to sit down together.

Speaker 1 Every dollar is going to have an assignment before the month begins. And then we're going to stick to that.

Speaker 1 Both of us are going to pinky swear spit shake. We have a marital contract that that's our game.
And we are going to do that. Both of you have a vote.
And both of you have an agreement.

Speaker 1 And both of you are grown-ups. No fit throwing, no four-year-olds.
I work so hard. Everybody works hard.
Please call me the Wambulance.

Speaker 1 Instead, get together, work on this stuff together, and you will see a change. John?

Speaker 1 Yeah, that's it.

Speaker 11 And the only other thing I would add is you can't put rent on the credit card if y'all have. gone that extra step and cut up all the credit cards.

Speaker 11 If you have a backup plan in this situation, you're going to use it every time. And so you've got to take that ability.

Speaker 11 Y'all have proven to yourselves you can't get there if that's an if you have this off ramp. So you got to get rid of the off-ramp.
You got to cut up the credit cards.

Speaker 1 Yeah, lobsters are the only things that survive going backwards. That's it.

Speaker 11 So we're going to cut them up, and then we're going to, that's going to force us every month to sit at the table and figure this thing out.

Speaker 1 Yeah, that's the deal, man. Well, maybe shrimp.
Yeah. Maybe crawdads, but crawds, too, too.
Crustaceans. But let me say this.

Speaker 11 And Dave said this the best, man.

Speaker 11 It's easy when you've been struggling financially, when you cross that magic number, whether it's 75 grand or six figures or 500,000, it's to suddenly think you're better than

Speaker 11 you're not. And you said it when you started the call.
She's been a great support staff for you. So

Speaker 11 be conscience of your language. This is y'all's money.
This is y'all's debt. And this needs to be y'all's plan out of this mess.

Speaker 11 And again, Dave, I don't know another way that it works.

Speaker 1 No, you have to be together working this, not separate accounts. It doesn't work.
I mean, everybody thinks that's some kind of individuality or something.

Speaker 1 If you want individuality, don't get married, okay?

Speaker 1 Geez, Jeez, you're a horrible spouse when you do that. Not you, but everybody that does it.
So, hang on, we're gonna sign you up for every dollar advanced version for free. We'll pay for it.

Speaker 1 Help you guys get on the right track. You can do this, Danny.

Speaker 13 Dave, we got a lot of calls on this show where life happens. One day someone's healthy, they're working, providing for their family, and then a curveball hits.

Speaker 1 You know, we hear it all the time: a car accident, a cancer diagnosis, a heart attack, and suddenly everything changes.

Speaker 13 Yeah, and that's why you've always said that having term life insurance from Xander is essential because it protects your family if the worst happens.

Speaker 1 Yeah, that's right. You need 10 to 12 times your income in coverage.
No gimmicks, no whole life junk, just straightforward term-life protection.

Speaker 1 But there's another piece that people often overlook, and that's long-term disability insurance.

Speaker 13 Yeah, it's important to understand the difference between them. Life insurance steps in when you die.
Disability insurance steps in while you're alive, but can't work.

Speaker 13 So it replaces a large part of your income so the bills still get paid while you get back on your feet.

Speaker 1 Now, if your employer gives you free disability insurance, great, take it. If it's discounted there at a better price, take it.
But if not, Xander can help you find the right plan.

Speaker 1 Whether you're single or married, it's not optional. If you're going to be out of work for a while, then you need to make sure the money's still showing up.

Speaker 13 And that's why Xander is our go-to. They make it super simple to get the right coverage at the best price, no pressure, no upselling.

Speaker 1 I've trusted Jeff Zander and Xander Insurance for over 25 years, and so is my family.

Speaker 13 So don't wait. It's fast, it's easy, and it could make all the difference.
Go to xander.com or call 800-356-4282.

Speaker 1 Protect yourself, protect your income, protect your family.

Speaker 1 Karen is in Raleigh, North Carolina. Hi, Karen.
How are you?

Speaker 15 I am doing well. Thank you, Dave and John, for taking my call.
Sure.

Speaker 1 what's up

Speaker 15 okay I have been unemployed since February and I was in the process of doing baby step two

Speaker 15 and I'm I still have not gained employment why once I'm employed

Speaker 15 I haven't gained employment because the sector that was really affected had reduced funding so it's been very hard to be or get back into that so leave the sector go to something else.

Speaker 1 It's been February.

Speaker 12 Yeah,

Speaker 15 and I have been trying even for customer service.

Speaker 1 How have you been eating since February?

Speaker 17 Well,

Speaker 15 when I was unemployed, I had 12 weeks of unemployment and my daughter got Social Security.

Speaker 17 Her father passed.

Speaker 15 and adoption and I had an adoption assistant. So after that 12 weeks, my parents have been helping me tremendously.
And

Speaker 18 I don't think that,

Speaker 12 I don't think without my parents' assistance, that I would have gotten this far.

Speaker 1 Wow. Well, that's sweet that they're there.

Speaker 1 What were you doing before you lost your job?

Speaker 4 I was a project coordinator in clinical research industry.

Speaker 1 Okay.

Speaker 1 Do you have project management skills?

Speaker 19 I do.

Speaker 15 I supported project managers, and I am studying to get my project management certification.

Speaker 15 Thankfully, I got a scholarship so that I could get the training and pay for my exam.

Speaker 17 So that has been a blessing.

Speaker 1 When will that be?

Speaker 12 September the 6th.

Speaker 1 Oh, good. Next week.
Okay.

Speaker 1 Good.

Speaker 7 Yeah, September the 6th.

Speaker 1 Okay, so

Speaker 1 listen, I want you going crazy looking for a project manager job starting today. And in the meantime, I want you doing 42 things at the local mall, work in retail, customer service from home,

Speaker 1 Walmart, Target, anybody that'll put you in there. And believe me, Target will put you in there if you're breathing.

Speaker 1 So,

Speaker 1 yeah, go get something at $20 an hour, get some money coming in to get the fear out of the back of your voice because that fear in the back of your voice, I don't want it there when you're interviewing for these project manager jobs.

Speaker 21 Of course. And

Speaker 15 like I said, I was doing the baby steps and I had $1,000 in

Speaker 17 the

Speaker 15 emergency fund. And I felt like that I wasn't even prepared for a layoff.

Speaker 1 Of course you weren't.

Speaker 1 You were in debt and broke.

Speaker 1 When you're in debt and broke, you're not prepared for a layoff. Of course you weren't.

Speaker 1 But we don't spend our lives staying in debt getting ready for a layoff either. So you were doing the right thing.

Speaker 1 The only thing I would question is, I got to tell you, I'm back to work in about 48 hours after I leave a job. I'm going to go crazy because it scares me to death not working and not making money.

Speaker 1 I can't handle it. The idea that the unemployment might be all I had, that would scare me to the point I'd be willing to do almost anything that was legal and moral immediately.
So

Speaker 1 I want to light a fire under you, girl. Go get something today.
I want you earning some money right this second. And then I want you to go get this project manager job.

Speaker 1 And I'm going to send you some of Ken Coleman's materials to help you do that.

Speaker 1 But here's what happens when you get laid off sometimes

Speaker 1 you

Speaker 1 it steals some of your

Speaker 1 confidence some of your swagger steals a ton of it yeah it makes you think it has something to do with you and it didn't have anything to do with you wasn't your fault and then the second thing is it while people are recovering grieving that

Speaker 1 as if there was a death, because there kind of is,

Speaker 1 it's easy to get paralyzed and drag this out

Speaker 1 and have tunnel vision and think, I've got to go back doing the same kind of job exactly that I did before.

Speaker 1 You need a new one. And as you said, that sector is sick, so get out of that sector.

Speaker 11 Yeah, I love the idea of professional identity being about who you help, knowing that how and who you help is going to change over time. But I'm a person who helps.

Speaker 11 And so that might be at Burger King for a season. That might be at Home Depot for a season.
And that might be a full-time psychologist for a season. It doesn't matter if that core identity.

Speaker 11 So, finding out you're a person who helps people solve problems. That might be a TJ Maxx, and that might be as a project manager for a highfalutin research.

Speaker 1 Making a hundred grand, right?

Speaker 11 But it's when our ego gets trapped in the job title, man, then you can stay unemployed for a long, long time.

Speaker 1 You can't stay unemployed 10 more minutes, girl. You got to go get it.
That's right.

Speaker 11 And you said something real important, and I don't know how this works.

Speaker 11 I don't know the biology or physiology of this, but a hiring manager, whenever I hired people, I could always tell who felt like I would be lucky to have them and who desperately needed me to have them.

Speaker 11 And it just, it impacted how I hired. There's a swagger you walk in when you are applying for a job.

Speaker 11 It's like, hey, I want to be here and you'd be really lucky to have me versus please, please, please, please, please, please, please hire me.

Speaker 11 And when you are able to eat and when you're able, when you've got another job in your back pocket, you can have a more honest, direct conversation than I'll take whatever you got, please.

Speaker 11 There's a desperation that just is in the air.

Speaker 1 It's in in the air. It's in your body language.
It's in your voice tone. It's in the pauses in your sentences.
It's in everything. And people can read it even if they don't know they're reading it.

Speaker 1 Kelly, pick up. Let's get her on Find the Work You're Wired to Do by Coleman and Proximity Principal.
And then I want you, Karen, to go to his website at kencoleman.com and download all the forms.

Speaker 1 They're free to write the resume finders. To get right in somebody's face and go get some positions right now.

Speaker 1 That is the answer to the equation, is income.

Speaker 1 and and looking in the mirror and saying karen's awesome there's nothing wrong with karen it's a thing that happened now karen's gonna get it get it courtney's in california hi courtney how are you

Speaker 1 hey i'm doing well how are you better than i deserve how can i help

Speaker 18 hey so um

Speaker 18 really very recently um i just my husband came to me and told me that we had a significant amount of debt,

Speaker 18 consumer debt,

Speaker 10 consumer debt, credit cards.

Speaker 18 It was about 50,000

Speaker 18 that I didn't know about.

Speaker 18 So we had some equity in our home. I took out a HELOC loan to just get rid of it.

Speaker 18 It was high interest credit cards and we have the HELOC loan now and that's those are all paid down or they're paid down and then through the HELOC loan, they canceled them all.

Speaker 18 I thought we were kind of through the storm of it.

Speaker 18 He came to me last night or just the other day and told me there was an additional $27,000 sofi loan that he took out to pay off the credit cards a year ago and then rent them back up.

Speaker 1 So Courtney, what's he spending money?

Speaker 10 Not the first time.

Speaker 18 Well, I asked for statements. I was going through some statements.

Speaker 18 It's mostly food. I only have statements from this year.
He hasn't sent me the statements from last couple of years.

Speaker 18 Partially my fault. I should have been more involved with the finances.

Speaker 18 I had some complicated pregnancies. and so I just asked him to handle it for the last few years because it's the pregnancies and just getting some stuff off of my plate.
I work a high-level camera.

Speaker 1 So, is he

Speaker 1 guys not making your ends meet? And this is the way he's covering it, and he didn't want to burden you with it because you asked him to handle it?

Speaker 1 Yes, that was what's happened. Are you confident of that?

Speaker 11 Yeah, it's rare that somebody runs up $75,000 and there's not something else they're hiding.

Speaker 12 Yeah, so I don't, I don't know yet.

Speaker 18 I'm still waiting on statements.

Speaker 11 I wouldn't wait another 24 hours.

Speaker 11 I wouldn't wait another 24 hours.

Speaker 11 It's all electronic. You can log in right away.
Any pause on his account is hiding stuff.

Speaker 1 Okay. Okay.
Yeah, that's scary.

Speaker 11 It should be.

Speaker 1 Yeah, let's get to the bottom of it.

Speaker 1 There's two possible options. There's something really scary going on that you still don't know about that's really bad.

Speaker 1 Or it's simply he's ashamed that he wasn't able to handle everything for you during a time that you were hurting, and he didn't want to tell you.

Speaker 1 Okay? And

Speaker 1 that's the most innocuous of all, and that one's easy to fix. It's now time for you to be a big girl and get involved.
The two of you together handle money together for the rest of your lives.

Speaker 1 I don't care who's going through a tough season. Both of you are grown-ups, for rich or for poor, in sickness and in health.
We're doing this together, and we both have full disclosure.

Speaker 1 None of us is being cared for unless there's there's an extreme illness of some kind that is ongoing and chronic, in which case you accept the consequences of not knowing what's going on.

Speaker 11 I would pull both credit reports tonight on both of you from the three credit reporting agencies so you get a clear picture. We're going to log into the accounts tonight and go through them together.

Speaker 11 And then y'all are going to be, you're going to put a freeze on your credit report so y'all can't take out any more loans without the other person knowing.

Speaker 1 And a promise that we're not going to do that anymore. And a promise you're going to be involved and we're going to work on this together from this point forward.

Speaker 1 If you were gone tomorrow, would your family know where your important stuff is? That's where KnockBox comes in.

Speaker 1 The things you've done to protect your family, like term life insurance, a will, and a security system, aren't much help if your loved ones can't access them.

Speaker 1 Knockbox, N-O-K, as in next of kin, Box is a simple physical system that holds all your important documents, account info, passwords, policies, and plans in one place so your family isn't left digging for them.

Speaker 1 Knockbox helps your family breathe in the middle of heartbreak and say, okay, we know what to do next. Love your family well by leaving them clarity, not chaos.

Speaker 1 Go to knockbox.com slash Ramsey to get started. That's n-okbox.com slash Ramsey.

Speaker 1 Well, you gotta have a month for everything, I guess. August is make a will month.
Gross.

Speaker 1 Okay, that's all right. It's not gross to make a will, though.

Speaker 1 It's kind of a grown-up thing to do because it's the admission that the people in your life you love are going to have a plan because you're going to be a grown-up and leave them a plan.

Speaker 1 And that's called a will.

Speaker 1 Grown-ups leave a will.

Speaker 1 Period. If you're 18 years old or older, you need a will.
I don't care if you have any assets. I don't care.
You don't want the government deciding what happens to your pets or your kids.

Speaker 1 Not necessarily in that order either. So the deal is you want a will.
You need a will. It's grown-up things to do.
What is it that millennials called it a few years ago? Adulting. Adulting.

Speaker 1 As if that was a verb. Okay.
Procrastination, 43% of adults without a will say they just hadn't gotten around to it. Yeah.
Perfectionism. I have to make some big decisions I don't want to make.

Speaker 1 Well, then let's just put it off till you die. That'll work.
Nope.

Speaker 1 I think I need a certain amount of assets. I covered that.
A belief that everything will automatically go to family. It doesn't.
It goes to the lawyers. That's who gets it if you don't do this.

Speaker 1 Uncertainty about the process, well, you got to figure out where to start. Go to ramseysolutions.com slash will quiz.
It's a free quiz and we'll help you walk through this.

Speaker 1 You need to get your will done. Ramseysolutions.com slash wills quiz.
It's a grown-up thing and we've done detailed research. You're going to die.
No one gets out of this alive.

Speaker 11 100%.

Speaker 1 And there is no correlation between doing a will and the probability of death. You're going to die anyway.
So you might as well.

Speaker 1 And if you want to piss people off with your will, do it while you're alive. John is here.
John's in Amarillo, Texas. Hey, John, how are you?

Speaker 10 I'm good. How are you, Dave?

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

Speaker 9 Hey, I was just calling.

Speaker 19 I'm 20 years old and I'm a full-time student and full-time working outside of school.

Speaker 9 And

Speaker 1 what are you studying?

Speaker 10 Business.

Speaker 1 Good. Okay.

Speaker 11 Are you out there at WT?

Speaker 1 Yes.

Speaker 11 Good for you.

Speaker 19 And then I was curious.

Speaker 7 So I'm in the farm and ranch industry.

Speaker 19 And I'm about, oh, I was about $100,000 in debt on vehicle loans.

Speaker 4 And then I just recently took out $100,000 to start a cattle business.

Speaker 1 Are you punking me?

Speaker 1 Who gave a 20-year-old a $100,000 cow loan?

Speaker 19 I know.

Speaker 1 Who?

Speaker 1 I don't know. No, yeah, you know.
Did you really do it or not? Are you punking us?

Speaker 9 Yes, I did. No, I really did it.

Speaker 1 You're kidding me. Who made the loan? What's the company's name? I want to make sure all of America hears who's stupid out there.

Speaker 7 It's a local bank here.

Speaker 1 What's the name of the local stupid bank? The name of the bank.

Speaker 7 Education.

Speaker 1 Education is the name of a bank?

Speaker 4 Yeah, education credit.

Speaker 1 Education credit.

Speaker 1 You pay for it with a student loan, education. They gave a 20-year-old a $100,000 loan to buy cattle.

Speaker 7 Yes, and I have a CD also.

Speaker 1 How big is your CD?

Speaker 7 $100,000.

Speaker 1 Oh, so they didn't give you a loan. You borrowed your own money.

Speaker 7 Pretty much, yes, sir.

Speaker 1 Where'd you get $100,000 in a CD?

Speaker 9 It was

Speaker 7 a partnership between me and a family member on some cattle that we've had for about 10 years, and then we sold those.

Speaker 1 So you made a profit, and now you pledge the whole profit into another herd.

Speaker 10 Yes.

Speaker 1 All right. What size cows do you get?

Speaker 11 What size cat? What size?

Speaker 10 What size? How many head?

Speaker 10 I got 25 head.

Speaker 11 And then how big are they?

Speaker 10 They are

Speaker 7 three to six years old, and they're going to be having calves in about two to three months.

Speaker 11 Do you know how to calve

Speaker 11 babies?

Speaker 10 Yes.

Speaker 1 He grew up on it. He grew up in it.
The family member was his father, probably.

Speaker 1 All right, honey.

Speaker 1 You called the wrong show. I'm sorry.
How can we try to help you?

Speaker 19 I'm just trying to figure out really like what I can do and if I'd like made a good decision on trying to like take this loan out.

Speaker 1 How long have you listened to this show, honey?

Speaker 4 About two years, probably.

Speaker 1 Have you ever heard me tell anyone to borrow money? For anything? No, I haven't. Ever.
No, sir. Okay.

Speaker 11 And here's how I'm afraid that you're going to be.

Speaker 1 So you kind of know you walked into the lion's den right

Speaker 11 yes well and here's what i'm afraid you're about to do those cows right now beef is at an all-time high because there's been drought right

Speaker 11 yes and you're gonna have babies and you might

Speaker 11 maybe

Speaker 11 you might be able to get away with this one

Speaker 11 and then you're gonna go do it again and you're gonna you're gonna put more down on it and you're gonna take out a bigger loan

Speaker 11 and then in 18 months or 24 months when everyone's got back into new cows because there's been some rain,

Speaker 11 the beef prices are going to plummet.

Speaker 1 And you're going to be up a creek.

Speaker 11 You're going to have lost it all.

Speaker 1 Yeah, your CD is what you lost. The bank hasn't got any risk.

Speaker 1 The bank's not stupid at all. They're begging for you to not pay this.
They're just going to scarf your CD.

Speaker 11 I think you're going to make your money on this one. I think

Speaker 11 it's the $250,000 loan you take after this one.

Speaker 7 I think, based on my math and everything, the market looks like it's going to stay where it's at for at least two years.

Speaker 9 And I'm planning on being able to pay this note off the third year.

Speaker 1 I think there's no chance.

Speaker 7 As long as the market doesn't go 50% less than what it is right now, I should be able to get it done in three years.

Speaker 11 Okay. I would get it down in one year.

Speaker 1 And here's why.

Speaker 11 The only reason Dave and I have a job is because people like you say,

Speaker 11 if this scheme I'm running just hangs on for three more years, I'm going to be all right. And it doesn't.

Speaker 1 right? That's the problem, right?

Speaker 1 So, um,

Speaker 1 would you have done this if you just cashed out your CD and used your money?

Speaker 10 Um,

Speaker 5 yes, I believe so.

Speaker 1 Okay, if you're gonna play, make a play like this, you should do it with real money, not borrowed money, okay?

Speaker 1 Number one, number two, what year in business school are you? First, second, third, fourth? Um,

Speaker 19 I will be a I'm between my sophomore and junior year.

Speaker 1 Okay. I want you to start doing some reading on commodities

Speaker 1 because beef is a commodity. Okay.

Speaker 1 And there's one thing that drives beef prices. Supply and demand.

Speaker 1 That's all.

Speaker 1 And if there's a shortage of beef, the prices run up. If there's an oversupply versus the demand, the prices go down.
So your math

Speaker 1 was a wild

Speaker 1 guess.

Speaker 1 That's what your math was. So anybody that's playing commodities, 100% of the time, you're guessing about what the future is going to do.

Speaker 1 The track record, the history of it on beef, like a lot of commodities, has gone up.

Speaker 1 But another commodity that you could study the volatility of, if you want to test my basic theory of economics here, is oil. Look at the barrel of oil and see what it's done.

Speaker 1 Okay? It's up and down, up and down, up and down, based on guess what? Whether the Middle East turns the spigot on or off.

Speaker 1 Whether the local domestic policy for drill, baby, drill turns the spigot on or off. If the spigots are off, oil prices go through the roof, and then so does the gas pump after that.

Speaker 1 If the spigots are wide open, oil prices drop through the floor.

Speaker 1 Okay? Has nothing to do with the inherent value of oil. It's the shortage or the oversupply versus demand.
And that's the game you're playing.

Speaker 1 Meaning that from a business perspective or a investment perspective, you are gambling. You are rolling the dice.

Speaker 1 Because you are in the world of beef, because you grew up in it, because you know something about the actual cattle, you have talked yourself into believing that you can predict a commodities price.

Speaker 1 That is unbelievably dangerous.

Speaker 1 And it will end in your failure eventually if you keep doing this. So the next time you get ready to make a gamble and you're going to put $100,000 on red or a hundred thousand dollars on black,

Speaker 1 make sure it's your money. So when you lose it, at least it's just your money that's gone.
If it goes up, it was your money that went up. If you're going to play this game, play it with cash, son.

Speaker 1 But I wouldn't play it. I wouldn't play it at the level you're playing it.
I wouldn't do it at 20 years old. Period.

Speaker 22 Switching banks can be a hassle, and I totally get that. But when Wince and I opened up our Fairwinds account, we were shocked by how quick and easy it was.
It just took a few minutes online.

Speaker 22 We didn't have to block off an entire afternoon or track down paperwork. And the next day, we got a personal call from a Fairwinds specialist just checking in.

Speaker 22 I couldn't believe it when I answered my phone and I was talking to them. I was like, y'all are the nicest people.

Speaker 22 Now, if you're working hard to save money, get out of debt and build a future, you should have a bank that supports that, not fights it. That's why I recommend Fairwinds.

Speaker 22 They created the smart checking and savings bundle specifically for Ramsey fans.

Speaker 22 Plus, they have a great app and you have access to over 33,000 fee-free ATMs and more than 5,000 shared credit union branches across the country.

Speaker 22 So you can have access and withdraw your money just like you're used to, no matter where you live. Don't settle for a bank that slows down your progress.

Speaker 22 Make sure you choose one that helps build you up and helps you win with money. Visit fairwinds.org slash Ramsey and open your smart bundle today.
Fairwinds.org slash Ramsey.

Speaker 14 Fairwinds.org slash Ramsey. Fairwinds is federally insured by the NCUA.

Speaker 1 Gang, if you like what you hear, we could use your help. You are our best marketing plan.

Speaker 1 You're probably close to our only one, but

Speaker 1 yeah, click the subscribe button, the follow button.

Speaker 1 It helps with the algorithm big time, and it causes the show to be pushed out over the various platforms in front of people who didn't know we were here previous because you liked it or you subscribed it or you followed it or you better than that you shared it tell people about us click the share button or cut the link and send it to somebody or just tell people about us either one we appreciate you thank you for that the listenership viewership of this this Ramsey show thing has exploded in the past five years the numbers are crazy thank you so much we appreciate you Steve is with us in Greensboro North Carolina hi Steve welcome to the show.

Speaker 1 Thank you, Dave. Thank you for taking my call.
Sure. I am 78 years old, retired, divorced, and have no debt.

Speaker 1 I have $300,000 in a Roth IRA all in mutual funds, $100,000 in a traditional IRA all in mutual funds, $1.2 million in an inherited IRA in individual stocks.

Speaker 1 $3.7 million in a brokerage account in individual stocks. About $100,000 in cash, giving me a net worth of about $5.4 million.
Way to go.

Speaker 1 My issue today is that in that brokerage, the taxable brokerage account, I have stock in one company with a value of $1.8 million, which represents 34% of my net worth.

Speaker 1 It's continuing to grow, and the outlook is good. My tax basis on that stock is $58,000, which means we're all subject to capital gains, and I absolutely hate paying capital gains.
I don't blame you.

Speaker 1 What would you do?

Speaker 1 Wow.

Speaker 1 Did you inherit any of this? You said an inherited IRA was 1.2.

Speaker 1 Do you have the rest of it other than that?

Speaker 1 No,

Speaker 1 I inherited

Speaker 1 $250,000 in cash, put it in stocks. I've taken $450,000 in RMDs, and it's still worth $1.2.
Yeah. Wow.

Speaker 1 The rest of it were just investments throughout the year. You've done amazing, Steve.
No one can question what you're doing. I've been extremely lucky.

Speaker 1 Well, yeah, you were lucky, but you were blessed, and you were smart, and you were working, and you were saving money while everybody was spending it. So I'm proud of you.
Good work.

Speaker 1 Well, I think your analysis, and I don't know what your background is, but it's excellent. Your analysis is excellent.

Speaker 1 One-third of your net worth is tied up in one single company, and as it goes, so goes your net worth. That's scary.

Speaker 1 Yeah. Yeah, that's standing on one leg, and somebody's kicking at your knee.

Speaker 1 I can add that I had some of that same stock in my inherited RA, about a half million, and sold that because of the percentage getting up. But everything is in my taxable now.

Speaker 1 So here's the thing. You're going to trade

Speaker 1 some taxes for some safety. Diversification equals safety.

Speaker 1 Or you're going to take the risk

Speaker 1 because you don't want to pay the taxes. It's a simple formula.

Speaker 1 There's no way around it. You're going to pay the taxes if you liquidate this because it's not in any kind of a protected account.
There's nothing you can do a roll on it. There's nothing like that.

Speaker 1 You just are just going to take the hit.

Speaker 1 I would not do enough where the taxes activate me above 15.

Speaker 1 Dad gum, your income may already be over 400K, though, is it? No, no, it's actually not.

Speaker 1 My taxable income this year is basically going to be RMD from that. And, you know, I'm expecting about $160,000 taxable income this year.
Okay. All right.

Speaker 1 Well, if I remember correctly, and I'm trying to pull up a cheat sheet because I don't have it.

Speaker 1 The max on the capital gains is $400,000 or somewhere right around there. If they had moved it up, it was $400,000 before you get kicked.
Have you looked that up yet?

Speaker 1 I plugged in,

Speaker 1 oh, just arbitrarily, about $600,000 capital gain in that, and it came out to about 25% federal and state tax, I would pay.

Speaker 1 Well, okay. Because if you go above 400, it goes from 15 to 20 on federal.
And I don't know what your state has, but it must be five, apparently. I'm not sure.

Speaker 1 So if you keep it under $400,000 and you roll $400,000, keep your total income under $400,000 or whatever the number is. I'm not a tax guy, obviously.

Speaker 1 But I'm I'm going to move up to the 400 mark, the 340,000 or whatever I can move,

Speaker 1 or 240,000, whatever I can move to not get above 400. And I'm going to start gradually moving this at 15%

Speaker 1 because I don't like the risk of the lack of diversification.

Speaker 1 It's painful to rebalance your accounts, but

Speaker 1 you're going to take the risk if you don't. And you're looking at that company going,

Speaker 1 I'm really, really like you

Speaker 1 because

Speaker 1 I'm going to be over there eating in their lunchroom, seeing how people are doing.

Speaker 1 I've heard you ask before if someone would, if their life would change, if maybe they lost a certain amount of money or whatever. Yeah.
And if I

Speaker 1 if you lost 1.8 million, you would feel that. Yeah.

Speaker 1 So. I don't think you're going to lose it all.
all i just could go in half

Speaker 11 um yeah well steve i've got i've steve i got i just get itchy because i grew up in houston when enron went away and i had friends and family that worked at enron and it just man that just makes me nervous or just thinking about what tesla was a year ago versus what it is right now everyone can it's just so easy to think uh this one's got a good upside to it and man my my lived experiences sometimes these things are just a vapor you know i i understand i know nothing for sure and i don't know whether they'd do you any good to know the company that I've no because it doesn't matter.

Speaker 1 I don't want to, it sounds like I'm trashing just that individual company and I'm not. I'm trashing the last

Speaker 1 diversification. Yeah.
And so,

Speaker 1 yeah.

Speaker 1 Okay. Yeah, I'm going to start systematically moving out of this.
I'm not going to panic and pay the over 20%.

Speaker 1 See, are you married filing jointly or single? You said single, didn't you? Single. Divorced, single.

Speaker 1 Okay, I just pulled it up while we were talking because I didn't know it's up to 566,000 now okay that you can move and so if you got 160 that leaves you 400 that you could move a year and still not be it accepted 15%

Speaker 1 because you got a $58,000 basis so it's pure gain basically right

Speaker 1 so yeah I'm gonna I'm gonna start moving about 400,000 a year

Speaker 1 over and paying the 15% and the 15% is my is not just tax it's the cost of safety due to diversification versus lack of diversification. And that's the way I'm going to look at it.

Speaker 1 I don't want to be that deep into one company. And so good question, though.
Wow. Congratulations still.
I mean, you've done a lot of, obviously, very smart things.

Speaker 1 And at 78, you're calling to ask that question. That's a pretty technical.
ticky-tacky question and it shows you really know what the flip you're doing. Congratulations.
Very neat.

Speaker 11 Very neat. That also shows to all the 26-year-old,

Speaker 11 George calls them the Instagram bros, it's just dedicated time. It's just time.
Small amount over time.

Speaker 11 Bought that at 56K and it's at 1.8 million. That is just getting in early and just set it and forget it.
Just go slow.

Speaker 1 Yeah, I mean, there's not a

Speaker 1 I can't think of a publicly traded company that's a household name. Well, I don't know when he bought it at 58.
That's the other thing. It would give you that in a short period of time.
Right.

Speaker 1 It's not going to go to 1.8 in a short period of time. I know there's not one on the big board on the New York Stock Exchange.
There's not one

Speaker 1 in a short period of time.

Speaker 11 I had a friend who worked at NVIDIA the day of or something.

Speaker 1 I don't know if you could get it on that one. You know, your wife was in Congress or something.
There you go. That'd be helpful.
But yeah, that kind of stuff. But yeah,

Speaker 1 that's the only way you're going to,

Speaker 1 I don't know if a stock has done that. I don't buy single stocks, folks.
And lack of diversification is one of the reasons. All of the data,

Speaker 1 even though Steve has done incredibly well, and I do congratulate him, all the data for the rest of us says we buy mutual funds because there's 90 to 200 different stocks in the average mutual fund.

Speaker 1 If you had 1.8 million and 90 to 200 stocks, you'd be perfectly safe compared to you've bet 34% of a $5 million net worth on one singular company's behaviors.

Speaker 1 They can make the decision to do anything stupid, and suddenly you could have a Bud Light moment.

Speaker 11 In half, yeah. I mean, it could be a Tesla moment or any cracker barrel moment right now, like any of them.

Speaker 1 You can see the stock just nosedive.

Speaker 1 You can have all that. And

Speaker 1 I don't want that. I don't have control over that.
So I'm going to put my money in that.

Speaker 1 Hold on, folks. Don't panic.
Buying a home in today's market doesn't have to be complicated, but it does take more than hope and a quick internet search.

Speaker 1 To get the right home, one that will be a blessing and not a burden, you need a trusted mortgage partner who will listen and serve you, not push more debt.

Speaker 1 You need the professionals at Churchill Mortgage. I've personally recommended Churchill for over 30 years, and they're the only mortgage company that's Ramsey trusted.

Speaker 1 Churchill stands out because they operate the Ramsey Way with transparency, integrity, and a commitment commitment to doing what's right for the customer, not what's profitable for themselves.

Speaker 1 Churchill aligns with Ramsey's values by focusing on education, responsible mortgage lending, and helping people make smart, long-term decisions that enable them to build lasting wealth.

Speaker 1 Go to ChurchillMortgage.com today to begin a better mortgage experience. ChurchillMortgage.com.

Speaker 23 This is a paid advertisement. NMLS ID 1591 NMLS Consumer Access.org.
Equal Housing Lender.

Speaker 1 Welcome back to the Ramsey Show. Dr.
John Deloney, number one best-selling author, is my co-host today. Anna is with us in Utah.
Hi, Anna. How are you?

Speaker 15 Good. How are you doing, Nick?

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

Speaker 16 Yeah, so my husband and I were 35 years old. We both hold

Speaker 16 master's degrees. I work part-time.
We've got littles. And we're in our second home that we've owned.
And I've found a lot in my dream area to build on, but it's very pricey and not...

Speaker 16 not where we'd want for a mortgage. It'd make it a high mortgage.
And I wondered if there's any time it'd be appropriate. We both make good money,

Speaker 16 to my parents have offered to help us out with about $100,000 to make it more of an affordable mortgage.

Speaker 16 Any time that that'd be appropriate to take that kind of money or how

Speaker 16 yeah, my husband, I mean, just my husband disagrees and doesn't think that that

Speaker 16 we should do that. So does that make sense, my question?

Speaker 1 That you should not take the gift from your parents or you should not buy the lot?

Speaker 16 I mean both. It would require taking the gift from my parents to buy the lot.

Speaker 1 But he doesn't want to buy the lot.

Speaker 16 He doesn't want to take the money from my parents, so therefore not do the lot.

Speaker 1 But I think what's the lot cost?

Speaker 16 $425.

Speaker 12 Really expensive lot.

Speaker 16 It's in a really nice area. So

Speaker 16 I think it's a good opportunity. I don't want to lose it.
And

Speaker 16 my parents, it wouldn't be a loan, but I think that we'd be able to do it.

Speaker 1 I think you told me three times indirectly you can't afford it.

Speaker 1 Yes.

Speaker 1 The words you're using say it's I can't chew this amount of food if I put it all in my mouth.

Speaker 16 Yeah. I mean with if we did do it, it'd be about

Speaker 16 close to 50% of our income for the mortgage.

Speaker 1 You got a lot fever, girl. You need to take a cold shower.

Speaker 11 You also have not wanting to be in the life you live in right now fever.

Speaker 1 Yeah, you're telling me about you cannot afford to live in that place. You don't make enough money.

Speaker 11 What's a hundred thousand dollar loan from your parents or a gift, whatever you want to call it? What's that going to actually cost you?

Speaker 16 Like emotionally weird.

Speaker 11 Yeah. Yeah.
What kind of strings are attached?

Speaker 15 Yeah, that's.

Speaker 11 I have no problem with somebody getting a big gift from their parents.

Speaker 11 I think it's amazing, and I hope I can do that with my kids, but I'm going to have to make sure in my spirit there's no strings attached to it when I give it.

Speaker 12 Yeah, I think that's my husband's concern.

Speaker 16 That it'd be.

Speaker 1 And it's based on the track record. He didn't just dream this concern of.
Right.

Speaker 1 So I'm asking you, what are the strings?

Speaker 16 Not a lot of strings, but I mean, just,

Speaker 16 yeah,

Speaker 16 I think he'd just feel uncomfortable and just normal.

Speaker 1 Are you an only child?

Speaker 1 No. Are you the oldest daughter? No.
Are you the only daughter? The youngest. The youngest daughter.
The youngest daughter. Are you the only daughter?

Speaker 16 No.

Speaker 1 Because I'm confused about why your parents want to participate in helping you be broke,

Speaker 1 live your little dream to live your dream that you can't afford because you told me six times you can't afford this i mean indirectly you know in your heart your brain is your brain is telling you you can't afford it

Speaker 16 yeah

Speaker 11 i'm more interested in time and if times change yeah and that kind of mortgage wouldn't be as crazy in a few years well then get it then we'll talk about it then but right now it's cray cray i i'm worried about what it is about your life you've you you both got the schooling that you wanted you have you have the family that you wanted what is it about that life that you're not at peace with?

Speaker 16 Um, we're currently the home we're in is in a dream area, a wonderful area.

Speaker 16 It's the same place the lot is at, but it's an older home and it's given us a lot of problems, including termites, which has been kind of traumatic for me. We've gotten those taken care of.

Speaker 16 I just don't want to deal with situations like that. So, I don't know if that's a yeah.

Speaker 1 So, what is your home? What is your home? Termites have been a

Speaker 16 currently, we think we could make 600 off it.

Speaker 1 We could make 600 off of it. Okay, and the lot is 425.

Speaker 16 Sorry, that wouldn't be make. I'm sorry.
$425, but that's without the build.

Speaker 1 I know, I know.

Speaker 1 And the 100th gift. And

Speaker 1 you have 600 equity or the price would be 600?

Speaker 16 The price.

Speaker 1 How is a house in the same neighborhood as a $425,000 lot only selling for $600,000?

Speaker 1 It ought to be a meat. I mean, that's...

Speaker 16 Maybe we could get more.

Speaker 1 Where did you get $600?

Speaker 16 The area has no...

Speaker 16 um that was not appraised but that's kind of what comparisons to around the area have been okay all right because

Speaker 1 if you buy a lot let me tell you if you buy a lot for 400 that's why the tid the rule of thumb in building is is the lot should be around 20 of the total when you're done okay

Speaker 1 all right and and so that means you're building a two million dollar house

Speaker 1 and you don't have that kind of money do you what do you what's your income?

Speaker 16 About $200.

Speaker 1 Yeah, you don't have that kind of money.

Speaker 1 And

Speaker 16 I could work full-time.

Speaker 1 Not what I want to do with Willows right now.

Speaker 1 Is that worth it? It's not worth it. I mean, you could kill termites.
You can't kill a big mortgage.

Speaker 11 That's why I keep... I don't think this is the house.
I think this is something about you not being in the skin you're in.

Speaker 1 Yeah.

Speaker 16 Well, it's the skin city. I mean, it's on the mountain.
There's no more lots around here. Everything's built out here.
You have to go out west if you want to to see it.

Speaker 11 Yeah, but somebody's going to buy that lot and build on it.

Speaker 11 And then

Speaker 1 their

Speaker 11 Nesteg's going to need to move somewhere. They're going to have grandkids, and the house will come up on the market.
But there's a fever inside of you.

Speaker 1 Listen, there's plenty of lots, and there's plenty of mountains, and there's the rest of your life to figure that out.

Speaker 1 Yeah.

Speaker 1 Dave, I hear this. Listen, I am a spender, and I love real estate, and I'm running through my head the number of times I have sounded like hers.

Speaker 11 I'm telling you, man, she's about to do something.

Speaker 1 I have gotten, I get the fever for something, and I get like a dog on a bone, and I'm just like a chasing a rabbit

Speaker 1 running through the forest, looking at, looking, I'm going to run this thing down. And I can hear that

Speaker 1 because I do it.

Speaker 1 I have to catch myself and go, wait a minute, this is stupid. I mean,

Speaker 1 I can point to you a lot down by our lake house that I chased like this. And it is a very unique property.
It's on a peninsula, and you own the whole peninsula. Yeah.

Speaker 1 And it would have been very, it's like she's talking about. And I chased that thing and chased that thing.
And then a guy bought it and built a house on it. And I actually tried to buy the house.

Speaker 1 And we were sitting in the front porch of that house, and there were nine million boats going by. And I felt like I was in the middle of the interstate.

Speaker 1 And I went, Thank you, God, for protecting me from me and not letting me get this because I don't want to be out here in the middle of this

Speaker 1 hell of a highway on the lake. And so I, you know,

Speaker 1 that's a 10-year story I just did right there. Yeah.
But

Speaker 1 I had the Jones for that stupid lot. Yeah.
It's like,

Speaker 1 I can totally relate to you. Take a cold shower.
Don't buy the lot. You can't afford it.

Speaker 1 And there's something wrong about the way you're approaching this. John's hearing it in your voice and your words.
I am too. And

Speaker 1 you're willing to sacrifice even

Speaker 1 dealing with your parents to get it. That's how bad you want this.

Speaker 11 Or even, you've done the math. Like, okay, what if I gave up a core value, which is staying home with my kids, and I gave up that for this piece of dessert.
Yeah, there's something

Speaker 11 on the grasses greener in your spirit right now.

Speaker 1 Godliness with contentment is great gain.

Speaker 1 And when I have violated that, and I have, I just told you a story when I was doing it, I didn't end up with a lot, but I swear to I think God just literally kept me from getting

Speaker 1 stupidity, yeah.

Speaker 11 I didn't have good spirit, that's right.

Speaker 1 Yeah, and I just,

Speaker 1 man, it's like going to an auction. Man, you keep flicking your ear, you know what I mean?

Speaker 1 Yeah,

Speaker 1 touching your nose.

Speaker 1 It's bad, y'all. Oh, we all got it.
You know we do.

Speaker 1 I've seen people do everything possible to get out of debt, selling stuff, starting side hustles, canceling subscriptions, giving up eating at restaurants, even turning off the air conditioner in the summer and sweating through it.

Speaker 1 But most of them don't know they're overpaying for their phone plan. With Boost Mobile, you get unlimited talk, text, and data for just $25 a month.
That's it. And that $25

Speaker 1 never goes up. No contracts, no junk fees, and no tricks.
So do the math. It's not that hard.
And go to boostmobile.com/slash Ramsey. Restrictions apply.
See boostmobile.com/slash Ramsey for details.

Speaker 1 Blake is in Arizona. Hey, Blake, how are you?

Speaker 1 Great, thanks. How can we help?

Speaker 6 So the background is: I'm 62. My wife is 51.

Speaker 6 We do not currently have any debt.

Speaker 5 Our home is paid for.

Speaker 24 I recently retired and started taking Social Security after I was let go from my job after 34 years.

Speaker 6 And

Speaker 9 we have

Speaker 6 I still have my 401k just sitting left with my former employer. I have about $1.1 million in that and another $100,000 in a Roth.

Speaker 9 We have

Speaker 5 approximately $500,000 in a

Speaker 6 high-yield money market, earning about 3.5%.

Speaker 6 We want to know

Speaker 6 it's really not

Speaker 6 you know, it's safe, but it's not returning the kind of money that we really need to. Really don't we're living on

Speaker 6 pretty much below our means.

Speaker 6 My Social Security, and then I also picked up a part-time job working at a local golf course just for something more to do.

Speaker 5 That covers our expenses.

Speaker 24 We're looking, we're wondering what would be best to do with that approximately $500,000

Speaker 5 for us for the future. And then also we'd like to start putting we have a new baby grandchild and we'd like to start saving for them.

Speaker 5 What would you recommend?

Speaker 1 Well,

Speaker 1 what did you used to earn at your other position?

Speaker 6 I varied in income.

Speaker 24 At the last, when I was let go, I made a little over $100,000.

Speaker 1 Okay. All right.
The $1.1 million is in traditional or Roth?

Speaker 6 It's in traditional.

Speaker 5 It's in a fidelity like a target date fund.

Speaker 1 Okay.

Speaker 1 All right.

Speaker 1 I would have you sit down with a Smart Vestor Pro, and there's a couple of things in this portfolio I want to work on, and I'll give you the background on what and why, okay.

Speaker 1 A Smart Vestor Pro is a network of people that are in the business. We don't do investing at Ramsey, but we endorse these folks.
We embrace them, and they are aligned with the teaching that we give.

Speaker 1 So you're going to hear things that sound a lot like Ramsey when you sit down with one of them. The first thing is you never invest anything without understanding it yourself.

Speaker 1 You've done a very good job getting to this point. Congratulations.

Speaker 1 You're almost multi-millionaires, and you're definitely millionaires, and it's pretty incredible.

Speaker 1 Well, you are multimillionaires because your house is worth enough to get you over the 2 million mark, so net worth-wise. So, good.

Speaker 1 Congratulations. You're in really, really, really good shape.

Speaker 1 I got two things here. One, we want to get the 500 invested, which is your question.

Speaker 1 The second thing is, I want to begin to think about how to move that 1.1 gradually to Roth and pay some taxes on it.

Speaker 1 Because at 72, you're going to be facing, which is going to be here in a heartbeat, only 11 years, you're going to be facing what's called RMDs, required minimum distributions on that.

Speaker 1 And I want to keep that from happening. And if you die with the whole thing intact, the entire account, of course, is taxable in an inherited IRA.

Speaker 1 for your kids. And by then, it'll be $3 million.

Speaker 1 Okay. Because you're not going to die anytime soon.
And it'll double and double again, double again, might be $5 or $6 million even.

Speaker 1 And so if it's in a Roth, if we can get it into a Roth gradually in the next 11 years before you get to RMDs, A, you don't have RMDs. B, your kids will never pay taxes on it.

Speaker 1 C, you'll never pay taxes on it if you decide to use some of it for something. So if it is invested, and I would probably reset the investments inside of there today

Speaker 1 from target date into some quality, long-track record growth stock mutual funds.

Speaker 1 I invest invest inside my retirement, and I've recommended for 30 years people do that in growth, growth and income, aggressive growth and international. I do not do Target

Speaker 1 because I don't believe, because I'm 64, I'm going to be 65, a touch older than you.

Speaker 1 And

Speaker 1 the data tells us that at your age and my age, if we're in good shape, healthy, which you are right now, I guess, and I am too, you didn't tell me otherwise, that we have a high likelihood of making it into our 90s statistically.

Speaker 1 And so that's still 30 years you've got to outpace inflation. And that target date is going to dumb down your returns as you get a little bit older.

Speaker 1 And there's no need to do that because you don't need,

Speaker 1 you can handle the little bit of risk that a good equality investment portfolio represents. So I'm going to move you away from target date.
I'm going to move you towards Roth with the 1.1.

Speaker 1 That's two things. All of this as you understand it.
Don't do it because I said do it. But I'm really happy right now that all of my retirement accounts are Roth for those reasons.
I don't have RMD.

Speaker 1 I won't ever have any taxes on it. Neither will my kids as an inherited IRA.

Speaker 6 How are you

Speaker 6 am I able to convert the traditional staff?

Speaker 1 You're going to pay taxes when you do. You're going to pay taxes on the amount you convert every year.

Speaker 1 That's why you're going to want to do it in stages to keep bracket creep from hitting you so hard. Because it's all ordinary income.
There's no capital gains available on it.

Speaker 1 Now, moving on to the 500, which was your original question, which is a good question, too. You've done a great job.
I just want to say it over and over.

Speaker 1 These are minor tweaks, but they'll help you to the tune of millions of dollars over the next two decades.

Speaker 1 The 500. That's what we're looking for.
Yeah, the 500.

Speaker 1 The 500, obviously, you do need to get that invested sitting there in stupid high yields crazy. It needs to get ⁇ you lost 50 grand last year or 60 grand by sitting there.
And

Speaker 1 that would have been nice to have around.

Speaker 6 Yeah, don't tell my wife that.

Speaker 1 Yeah, I mean, it's missed what the market did versus what you did. You know, that's what you're missing, opportunity cost.

Speaker 1 So

Speaker 1 what you're going to do there is look for what's called a low turnover mutual fund.

Speaker 1 Inside the mutual fund, there's 90 to 200 stocks. If they sell almost none of them, low turnover of the stocks, it does not activate any taxable gain or very little taxable gain unless you sell it.

Speaker 1 Okay, an example of that is an S ⁇ P 500. They typically have a 3% or 4% turnover ratio, meaning 97% of the stocks sit there and grow, but create no taxes.

Speaker 1 It's like buying a single share of Home Depot for 50 bucks and it goes to 70. You don't pay any taxes on the 20 until you sell it.
That's capital gains growth. Okay?

Speaker 1 Okay. So it's like buying a rental house for 500 grand and it goes to 700 grand.
You don't pay any gain, capital gains tax. You don't pay any tax on that 200 growth until you sell the house.

Speaker 1 Same thing's true in a low turnover mutual fund. So you're not going to have taxes.
That's great for now.

Speaker 1 When When you do have taxes and do decide to pay them, they're going to be a capital gains rate, which is 15% instead of 37%. So that's wonderful.
So low turnover growth stock mutual funds.

Speaker 1 So I use S ⁇ P 500s for a lot of that. You can use other stuff too.
I've got another

Speaker 1 couple of million in a different one that's not an S ⁇ P that I'm letting sit. The S ⁇ P, I use it for saving up to buy real estate.

Speaker 1 Anyway, so you're looking to learn about the low turnover mutual fund because it grows with no taxation unless you pull it out.

Speaker 1 Okay.

Speaker 1 And you're going to get marketplace growth because S ⁇ P 500 is going to be, you know, traditionally has been 11, 12% a year, has been the rate of returns. So

Speaker 1 in the last two years, it was over 20%. It's not going to be that forever.
That's not an offbeat thing.

Speaker 1 Low turnover mutual funds,

Speaker 1 that keeps you from paying taxes on it as it grows unless you pull it out. If you leave it alone a year and you do pull it out, it's only going to to be at

Speaker 1 capital gains rate, not at ordinary income rate. So smart, all of this to say, learn all that again because you don't want to learn it from some guy on the dad gum podcast.

Speaker 1 You want to sit down and learn about this yourself. It's millions of dollars and it matters.
So you're smart to ask the questions.

Speaker 1 The Smart Investor Pro's job is not to do it for you, not to tell you what to do. Their job is to teach you what is possible and then you choose among the things that are possible.

Speaker 1 And that'll get you there. But

Speaker 1 those two little tweaks right there in the next two decades are probably $4 million,

Speaker 1 maybe more,

Speaker 1 in what happens to your stuff versus target, regular investments versus target date,

Speaker 1 Roth versus traditional, and low turnover versus high yield.

Speaker 1 And those rates of return and that amount of money, that's what it's going to do. And a good thing to keep in mind if you're looking at this stuff, folks, is it's fun to do the math real quick.

Speaker 1 Okay, he's sitting on basically $2 million.

Speaker 1 If it's growing at 10% every seven years, it's going to double. He's 61.
At 68, he's going to have 4 million. At 75,

Speaker 1 he's going to have 8 million. At 82, he's going to have 16 million.

Speaker 1 And he's very likely to get there, statistically, from an actuarial table, which is the death rate table thing, okay, for life insurance policies.

Speaker 1 So once you make it empty into your 60s and you're healthy, you're not going to die at 76, usually. 76 is your average male death rate, but that includes infant mortality, teenage death, and so on.

Speaker 1 So you can't run your numbers based on that anymore once you get to be old like me and him.

Speaker 1 With the lowest prices of any national grocery store, shoppers save big at Aldi. Aldi believes in making shopping straightforward and stress-free.

Speaker 1 Whether you're firing up the grill for a family dinner or hosting a backyard barbecue, Aldi is there to help.

Speaker 1 They've got a great selection of fresh USDA, choice meats, and organic produce at prices that won't bust your budget.

Speaker 1 And no messing around with apps, coupons, loyalty cards, or membership fees to get low prices on award-winning products every day. So stop overpaying and start shopping at Aldi.

Speaker 1 Find a store near you today at Aldi.us. That's A-L-D-I.U.S.

Speaker 14 Savings based on regional analysis of Aldi versus select competitors. Prices may vary by location, product availability, and the market.

Speaker 1 Dr. John Deloney has had

Speaker 1 three number one bestsellers, two of them big, hairy, nice hardback books. John, none of them are as pretty as this.

Speaker 11 They're not as pretty, or

Speaker 11 and none of them are as

Speaker 11 personally important to a guy that struggles with being on time as the 2026 Ramsey Goal Planner.

Speaker 1 Yeah, you have a goal and a planner. Maybe you can be on time.
But if you write a book. I can see the thing you did on Instagram.
That's pretty funny.

Speaker 11 If you co-write a book with Rachel Cruz and Jade Warshall, it's going to ⁇

Speaker 11 the beauty will win out over whatever madness I was trying to pick up.

Speaker 1 I got to tell you,

Speaker 1 the Ramsey team,

Speaker 1 the design team. Yeah, the Ramsey Gold Planner is a big deal.
Everybody gets them every year, and they always sell out.

Speaker 1 We only do about 10,000 of them, but they sell out like immediately here in the fall. So this is 2026.
It's gorgeous. The creatives, we kind of turn the creatives loose and go have fun.
Right.

Speaker 1 This is like their sandbox.

Speaker 11 And usually I'm like, yeah, I want to see it. And they say, you're not allowed to see this one.

Speaker 1 Yeah, and you're not allowed to touch this, John. Nope.
Dave, you can't even say anything about how much it costs because it costs a lot to produce the thing. It's a beautiful piece, though.

Speaker 1 A full calendar, of course, and a full process for applying the calendar, setting goals. And it's absolutely amazing.
And let me shout out. And the weird thing is, we did cut the price.
We do.

Speaker 11 We sell it early, and we do cut the price significantly.

Speaker 1 And I want to shout out everybody who's fighting the system and still writes things down with pen and paper gotta tell you i love it i love it my wife and i in the morning is one of the things she says let's do calendars which is one of the things we stay aligned on our money we stay aligned on our time oh that's romance talk in my house and we stay sales and we stay aligned yeah

Speaker 1 so um

Speaker 1 yeah we we this morning she said let's do calendars let me tell you what she gets out old school that's what my wife does a little black thing with a little flip on it and it flips it open it's got she's it's all written down yep and you know what?

Speaker 1 It doesn't get deleted. Nope.
Unless you mark through it.

Speaker 11 There's no AI box

Speaker 1 going through it. $35.97 if you want to pre-order.
It's the best deal you're going to get because that

Speaker 1 we paid a lot to bruise these. So, yeah, we did.
Jade, Rachel, and Deloney monthly content from them as you go through your months and planning.

Speaker 1 If you grab it before Labor Day, it's just $35.97, the lowest price. Even Black Friday pricing won't beat this.
Ramseysolutions.com slash store.

Speaker 1 If you're watching on YouTube or podcast, you can click the link in the description. I got to tell you, we put out a lot of nice products.
I'm really, really proud of this product.

Speaker 1 The people that get it always love it.

Speaker 1 It's a lot. And you got it.
It's all there. It walks you through lessons from Rachel, from Jade, and from Dr.
Deloney as you're going through. And you can lay out your spiritual year.

Speaker 1 You can lay out your physical year. You can lay out your time.
It's all in there. And it is an incredible, incredibly well-designed tool.

Speaker 1 And again, it's a beautiful, beautiful, beautiful piece of work. So all the way around.
Eric is in Cleveland, Ohio. Hi, Eric.
What's up?

Speaker 17 Hi, good afternoon, everyone.

Speaker 17 So I am a third-year medical student, and I've talked to a lot of physicians who have advised me not to worry about loans because they'll easily be paid off when you're earning a physician salary down the line.

Speaker 1 Sure, easily.

Speaker 1 The med students never call into the business.

Speaker 17 Honestly, that's a long ways away.

Speaker 1 New residents never call into the show, Eric, ever.

Speaker 11 Panicking. So you're

Speaker 1 nothing. Go ahead.
Go ahead, Eric.

Speaker 17 So I also recently got married about eight, nine months ago, and I want to know the best way for my wife and I to be proactive about our loan study now and manage slash know how much we should be putting aside for savings for a house, investing in our ROS at this time.

Speaker 1 I love your question.

Speaker 1 It's a very wise question to say, I'm getting ready to come into some money. What is the smart thing to do with it? I've worked really, really hard to get to this point.

Speaker 1 How can I be the smartest and get the most traction with all this work I put in? Because you've worked your tail off to get here. Congratulations, sir.

Speaker 1 So, very good question. All right.
All snarkiness aside, I'm still going to tell you the truth. The first rule is this.
I live in Nashville,

Speaker 1 okay?

Speaker 1 And

Speaker 1 so I know the country music folk. I grew up in Nashville.
I know the country music folk.

Speaker 1 And I know all of them that almost made it,

Speaker 1 too.

Speaker 1 And I also speak to NFL rookie camps and explain to the young guys that NFL stands for not for long.

Speaker 1 The average NFL career is 3.8 years and they think they're rich. Okay.

Speaker 1 So there's only one thing dumber than a country music artist who's getting ready to lose everything because of bad financial advice or a new NFL star that's getting ready to lose everything and that's your fellow doctors giving you financial advice.

Speaker 1 They are the world's worst with money. 35 years I've been doing this.
I am constantly amazed at how the typical MD is absolutely stupid with money. It blows my mind.
Now there's exceptions.

Speaker 1 There's exceptions. So that's rule number one.
Don't listen to these guys that have advice.

Speaker 1 Now, rule number two, you're very smart to ask advice and to learn things from several different sources, and you use that wonderful brain God has given you because dumb people don't get this far in a medical school, even though I just made fun of them for their financial stuff, but they're not dumb, okay?

Speaker 1 But you don't get that far, and so use that brain of yours to learn.

Speaker 1 Do not put money in stuff you don't understand, and keep asking a thousand questions like the one you just asked for the next 10 years, and you will become very, very wealthy.

Speaker 1 So, you are on the right track. In the multitude of counsel, there is safety, the Bible says.
And And so you keep gathering and learning and learning and don't do everything Dave Ramsey says.

Speaker 1 You go learn about it for yourself. Now, having said that, also having coached some docs who did a great job becoming very wealthy very quickly,

Speaker 1 one of the things we coach them to do is to avoid what we call docitis when you come out of med school. So you have a

Speaker 1 You're in the top 1%

Speaker 1 of the population in emotional maturity. One measure of emotional maturity is the ability to delay pleasure.

Speaker 1 You have, while all of your friends from high school have been out playing beer pong, you've been going to class and reading books

Speaker 1 for a decade longer than they have to get to where you are. And so you've been holding your breath much longer than the typical person walking around listening to this conversation right now.

Speaker 1 You've been delaying pleasure to get to a greater good. So you know how to accept pain to get to a greater good.
You know how to pay a price to win. Otherwise, you wouldn't be where you are.

Speaker 1 You don't graduate med school unless you get that concept from a psychological, emotional standpoint. Does that make sense?

Speaker 1 Yes. It's a huge compliment.

Speaker 17 It doesn't necessarily have that, which sometimes can create a clash, but I agree. Yes, I understand that.

Speaker 1 Yeah, so when you get out, the typical doc has been holding their breath for a decade longer than everybody else.

Speaker 1 And when they exhale, It looks like this, a new house, an investment account, and a BMW.

Speaker 1 And the student loans are just sitting there looking at them because they've been waiting so long to enjoy this income that the first thing they do is go enjoy it.

Speaker 1 And I'm going to beg you to do one thing, and that's continue to hold your breath for 18 more months after you get out and get your past your bars, you take the big job, you take the signing bonus, and you clear the 200K as fast as you possibly can.

Speaker 1 Keep living like a broke resident for a short period of time and clear the debt because then you've got $200,000 to $800,000 a year or whatever your income is going to be for for the rest of your life with no monkey on your back.

Speaker 1 And you can become wealthy so quickly.

Speaker 1 But if you kick the can down the road on this 200K, like those docs are suggesting, you're going to be in debt the rest of your life and you're going to suck at money and you're going to struggle.

Speaker 1 So I would live like a resident, like you were broke, and clear this up as fast as you can.

Speaker 11 And with your marriage income, brother, I would

Speaker 11 invest, not in Roth, not in real estate. I would invest in you right now.
Can you and your your new wife, can y'all get through the rest of this year and next year before you start getting paid?

Speaker 11 Can you get through the tuition? Can y'all cash flow that?

Speaker 17 So she makes she was making around 80K as a registered nurse. Okay.

Speaker 17 And then

Speaker 17 we were able to chip about $40,000 off. Amazing.

Speaker 1 Yeah. So we got a lot of...
First goal is no more debt, though.

Speaker 1 First goal is no more debt. Second goal is chip away at it.

Speaker 17 So the problem was she went back to nurse practitioner school as well in January.

Speaker 1 Oh, so how much is she going to owe?

Speaker 17 So she doesn't owe anything. Her father had a 529 for her, so we don't have any loans on her part

Speaker 1 of me. Excellent.
You guys are going to be making 600 grand.

Speaker 11 Yeah, y'all are going to be doing well.

Speaker 1 This is so great.

Speaker 1 Please pay off the debt as fast as you can. As fast as you can.
No investments, no purchases. Live like broke college students till all the debt is cleared.

Speaker 11 18 more months, dude.

Speaker 1 Both of you pass your bars. Don't suffer from dachitis.

Speaker 1 Today's Ramsey Show question of the day is brought to you by YReFi. If you've been turned down for refinancing your defaulted private student loans, well, you're not alone and you're not out of luck.

Speaker 1 Why ReFi exists to give people just like you another shot? Go to whyrefi.com slash Ramsey. That's the letter, YREFY.com slash Ramsey, not in all states.

Speaker 11 All right, today's question comes from Felix in Pennsylvania.

Speaker 11 Felix writes, I am a millennial and multiple families that I know who have children are selling their houses to live in RVs because they want to get out of debt. They are basically homeless.

Speaker 11 What is going on with my generation?

Speaker 11 I don't think we can cover that in this podcast.

Speaker 1 We don't have enough time.

Speaker 11 I know debt is to be avoided, but is this trend healthy or

Speaker 11 is gazelle intensity going too far?

Speaker 1 It's a good question.

Speaker 1 I don't think that's gazelle intensity. I think that is

Speaker 1 gazelle intensity is being very intense and sacrificing to get to a future

Speaker 1 goal.

Speaker 1 I've done this show for 35 years. I've never told someone to sell their home and live in an RV.

Speaker 11 I think that's a part of

Speaker 11 the hack virus that we live in as a culture.

Speaker 1 Yeah, but that's not you and I. I mean, it's not Ramsey advice.
And Ramsey advice is gazelle intensity. So I invented that phrase.
So no one used that phrase before me. Right.
So that's,

Speaker 1 but

Speaker 1 is this

Speaker 1 a segment of

Speaker 1 a

Speaker 1 generation that feels hopeless and stuck, and so they resort to extreme measures that are over the pale to try to get unstuck? Yeah, that would be true. Yeah.

Speaker 11 Or people have bought way too much house, way too much car, and they're just hitting control-alt-delete on their life.

Speaker 11 Or they grew up playing video games and they're just hitting reset on the Nintendo and starting over.

Speaker 1 But yeah,

Speaker 11 I think it's one of those

Speaker 11 not an either-or question here.

Speaker 1 It's not the right move, right?

Speaker 11 Agreed. But getting out of debt is very important.

Speaker 1 Yeah. Now, selling your home, moving into an apartment, that might work.
Absolutely.

Speaker 11 I've done that. I sold my house and moved into a dorm for crying out loud.

Speaker 1 Yeah, we've been there. I've been there.

Speaker 1 But

Speaker 1 I always answer questions the way I would answer them.

Speaker 1 What would I do if I was in this shoes? And there's never a moment in my life that I would live in an RV

Speaker 1 because I want my wife to live with me and she wouldn't live there. So

Speaker 1 it's not a dream of ours at all. It's more like a nightmare.
And we would be like cousin Eddie. And so,

Speaker 1 no, we don't need to do that. The Ramseys don't.
So I don't tell other people they need to do it. I have had people do some wild things.

Speaker 1 I remember about, gosh, it's a long time ago, a couple of decades ago, a guy

Speaker 1 in Birmingham sold his home And he called me up and told me he bought a trailer. And I'm like, oh, God, why don't you buy something going down in value? He goes, Dave, I paid $1,000 for it.

Speaker 1 You moved into a $1,000

Speaker 1 mobile home.

Speaker 1 You might be a redneck if.

Speaker 1 My godson, really?

Speaker 1 And he's like, yeah. And he was making like serious money.
And he goes, but in two years, I'm going to pay cash for a house. And that's the price we're going to pay.
And we're willing to do that.

Speaker 1 I'm like, okay, you're willing to do something I'm not willing to do. So

Speaker 1 I can admire you for that, but I can't make that the program. Sure.
It's not what I teach. Yes.
And so, and he did.

Speaker 1 He saved up like 300,000 bucks or something in the first, in two years, and went and bought a house for cash. It's amazing.
And but

Speaker 1 I don't see you moving Sheila into a single wide. Nope.
Nope. So

Speaker 1 here's the thing.

Speaker 11 When he asked the question,

Speaker 11 what's going on with my generation? There is a challenge. You can call it resilience.
You can be whatever.

Speaker 11 Discipline over time.

Speaker 11 Doing a hard thing with repetition, whether it's diet, whether it is working on relationships, whether it is getting out of debt.

Speaker 11 I would say there is a generic allergy in our culture to discomfort over 24 to 36 months. People don't mind doing something painful right this second,

Speaker 11 but they don't want to stick to a hard thing over time. And we've been told you don't have to.
And actually, we're a little sliver of history where there is some hacks around some stuff.

Speaker 11 And so everyone's looking for a way to do the craziest thing as pain-free as possible.

Speaker 11 And so I think if you ask me that question, your culture doesn't want to live within their means and take what that means, which is, okay, we can't live in Manhattan doing this editor job that we saw on Instagram.

Speaker 11 We're going to have to live in Kansas or in Nebraska where we can afford to live and do a job that maybe isn't our quote-unquote passion job.

Speaker 11 Or if you found yourself way, way in debt, to sell the cars and put two kids in car seats in a Corolla, which is uncomfortable, but it's doable, and take three years to work with intensity, focus intensity over time, and be uncomfortable for that long.

Speaker 11 That to me is the biggest allergy I think we have culturally.

Speaker 1 Yeah, I remember distinctly

Speaker 1 Millie Ramsey driving a

Speaker 1 I mean, when she's 19 years old, driving a Chevy 2,

Speaker 1 which is like the first version of a Chevette kind of thing.

Speaker 1 It had two doors. It had a small little four-cylinder in it.
Gas was 12 cents a gallon.

Speaker 1 And you could get to the top of the road above the gas station and run out of gas and coast down to the gas station, and we did.

Speaker 1 And I would say, Mom, when are we getting an air conditioner for the car? And she said, We have a 240 air conditioner. Roll down two windows.
We're going 40.

Speaker 1 And so

Speaker 1 they paid a price. That's right.
That generation paid a price to live. They lived like that for a long time before they saw prosperity.

Speaker 1 And then I saw that.

Speaker 1 But, you know, I was telling somebody the other day, they were asking me about Gen Z's because we've got so many Gen Z's here at Ramsey and millennials.

Speaker 1 I would say out of our 1,100, those two generations represent probably 700 people.

Speaker 1 Maybe 600, something like that. The vast majority of the people work in this building fall in that.

Speaker 1 And I think they're the two best generations I've run into in a long time for wealth building and for a a lot of things. And the reason is, is they grew up with a magic wand in their hand.

Speaker 1 And the magic wand says if you push a button, stuff shows up on your porch. If you push a button, you can get the answer to any question.

Speaker 1 If you push a button, it'll track all of your medical desires and things you wonder about. If you push a button, and so they have an abundance mentality because to them, everything's possible.

Speaker 1 Because if they push a button, anything happens.

Speaker 1 And it's a natural built-in in their DNA, an abundance mentality. They're not scarcity driven.
They're They're abundance driven. And that's a wonderful thing.

Speaker 1 And so they think like anything's possible because to them, anything's possible. Right.
And so that is a wonderful trait of this generation. What they don't have is zero patience.
Right.

Speaker 1 Because

Speaker 11 when you push a button, crap shows up on your porch that day.

Speaker 1 That day. I mean, you know, you didn't have to walk uphill both ways in the snow to go buy some toilet paper.
That's right. It shows up on your porch.
You know, and so there's no patience.

Speaker 1 I'm not going to wait for anything. I'm not going to struggle for anything.
I want it right now. It's a microwave, not a crock pot.
Don't talk to me about cooking something over the whole weekend.

Speaker 1 You don't cook stuff overnight. You cook it and we eat it right now.
Right.

Speaker 1 And

Speaker 1 if they have a fallacy, it's that. And it relates to this question.

Speaker 11 Yes, exactly. And so I would tell you, yes, get out of debt.

Speaker 11 And well, I think when it comes to pushing a button, I think the friction between what I want and what I can get is been so intentionally dissolved that it is untethered us from reality.

Speaker 11 That water comes from somewhere. That cow came from some farm somewhere.

Speaker 1 It's magic.

Speaker 11 It's magic. And the longer you live in magic land, the more divorced from reality you get.
And that's what companies want, right? They don't want you tethered to reality.

Speaker 1 I'm going to hold an $1,100 magic wand in my hand and criticize capitalism.

Speaker 11 I'm going to give one to, I'm going to give an $11,000, I mean, $1,100 computer to a six-year-old, right?

Speaker 1 Because you quote unquote need one.

Speaker 11 It's madness, but we're untethered from reality.

Speaker 1 Right. But it is, there's good parts to it.
There's amazing parts to it. I think the possibility thinking,

Speaker 1 to quote a guy from three generations ago, Dr. Robert Schuler, right? Possibility thinking, this generation thinks anything's possible.

Speaker 1 And when you're sitting in meetings with them, dreaming up the next thing to do in business, that's about as positive a trait as you can have, rather than some sour-faced boomer sitting in there going, well, it won't work.

Speaker 1 It can't be done. That'll never work.
Like Eeyore is in the meeting with it.

Speaker 11 It's a weird juxtaposition of, yes, we can do that, but I need a work-life balance, right?

Speaker 1 It's like,

Speaker 1 but I want to work from home.

Speaker 11 It's like the boomerang's like, that ain't gonna work, and I'm gonna spend the next 80 years trying to tinker it away until it finally does work.

Speaker 1 Yeah, I'm gonna keep messing with this and keep messing with this and keep messing with this. Perseverance.

Speaker 11 So the allergy is like discipline over time, perseverance. It's gonna suck for a long period of time, and we're gonna be stunned at how much we got done and how strong we are at the end of this thing.

Speaker 1 Start it with the possibility thinking and then stir in a little patience and

Speaker 1 stir in some discipline and perseverance and you've got a real, these two generations are going to be the best generations we've ever seen on the planet.

Speaker 1 It's way too easy to put off making a will. And believe me, I've heard every excuse in the book.
But not having the time is one excuse we can kick to the curb right now.

Speaker 1 Because these days, most folks can make a legally binding will on their laptop between loads of laundry.

Speaker 1 If you're wondering if you can make your will online or if you need a lawyer, we have a quiz to help you figure that out in less than five minutes. Just go to ramseysolutions.com slash willsquiz.

Speaker 1 Ramseysolutions.com slash WillsQuiz.

Speaker 1 Welcome back to the Ramsey Show. Dr.
John Deloney, Ramsey personality and host of the Dr. John Deloney Show is my co-host today.
The phone number is 888-825-5225. Mike's in St.
Louis.

Speaker 1 Hey, Mike, how are you?

Speaker 1 I'm good. How are you guys? Better than I deserve.
What's up?

Speaker 21 Just wanted to ask, is it a good idea idea to sell our house in order to get out of our consumer debt and fast forward the baby steps?

Speaker 1 Okay.

Speaker 1 How much consumer debt do you have?

Speaker 21 About $36,000, 24 credit card, $12,000 in a car.

Speaker 1 Okay.

Speaker 1 And

Speaker 1 what's your household income, sir?

Speaker 21 Household income right now. I just picked up another job, but currently I'd say our household income is

Speaker 21 about $4,000 or $4,500 after taxes right now, but that should bump by about $3,000 here in the next few months.

Speaker 1 So you're going to be making $7,000 a month in the next few months?

Speaker 21 I'm sorry, I'm being a little exaggerative, I guess.

Speaker 21 So

Speaker 21 let's back that down to $6,400, $6,500 a month.

Speaker 1 Okay, so you'll be making $6,000 a month. How much is your house payment?

Speaker 21 $1,200.

Speaker 21 Okay.

Speaker 1 All right.

Speaker 1 Do you hate your house?

Speaker 8 No, I don't hate it. It's

Speaker 21 very small, so we do not hate it, no.

Speaker 1 Okay. All right.
No, you should not sell your house.

Speaker 1 Your house is not the problem and it's not the solution. Okay, so you make $6,000 a month.
You have a $1,200 house payment. At some point, you'll make $6,000.
You don't today, I understand.

Speaker 1 But we're talking about a couple months ago, right? Okay. $1,200.
So that leaves me

Speaker 1 $4,500 to buy food and reduce debt.

Speaker 1 Okay?

Speaker 1 You owe $36,000.

Speaker 1 So

Speaker 1 if you put $2,000 a month on the debt, you're out in 18 months.

Speaker 1 If you put $3,000 a month, you're out in one year.

Speaker 1 So somewhere between one year,

Speaker 1 and 18 months, depending on whether your $6,000 or your $7,000 is correct, One of those two. But somewhere between

Speaker 1 one year and 18 months, you should be out of debt. And no, you don't sell your house for that reason.
Instead, you live on beans and rice, rice and beans, for one year to 18 months.

Speaker 1 Don't go out to eat. Don't go on vacation.
Roll up your sleeves. The two of you sit down and make your budget scream.
Make your broke friends think you've joined a cult.

Speaker 1 Get really, really serious about leaning into this debt. And chop up the credit cards tonight, light a candle, and have a plastic surgery ceremony.
And

Speaker 1 then let's just tear into these cards and this debt.

Speaker 1 You guys have not been living on a plan, and you've just increased your income substantially in the last year or so, and that's concluded by this next raise, right?

Speaker 10 Oh, correct.

Speaker 1 Yeah, yeah.

Speaker 11 So here's the way I like to think of it, dude. If there was a marathon in your town,

Speaker 11 you could take an Uber to the last mile and run the last mile. They'll give you a ribbon.
They will

Speaker 11 congratulate you and everybody will cheer for you as you cross the finish line. You could do that.
And you'd still have crossed that finish line.

Speaker 11 If you train for that thing and you run that thing and you get all the blisters, all the pain,

Speaker 11 all the stuff that comes with running it, when you cross that finish line, A, you're a different person. Y'all will be a different married couple together.

Speaker 11 And you're going to be way stronger, way better shape than the person who just took the Uber to the last mile.

Speaker 11 And so selling your house right now is a hack and it might clear it up, but y'all will still be y'all. And so the chances y'all fall back into something is 100%.

Speaker 11 And so I love the idea that y'all are going to scratch and claw for a year, 18 months, and

Speaker 11 the sweetness of crossing that finish line will be such a different feeling. And you'll have a different level of strength than if you just got dropped off.

Speaker 1 And the two of you locking arms to set a goal and attack this goal with a vengeance is huge for a young marriage. And the deeper you cut, the faster you get out.
The more you work,

Speaker 1 the more you make, the faster you get out. And so just look at this and say, how much work can I do? How little can I spend? And look at your spouse and go, how much work can we do?

Speaker 1 How little can we spend? And then we'll be out that much faster. And John's right.
You'll never look at a credit card the same after this.

Speaker 1 You know, it's kind of like once you get food poisoning on something, you never want to eat it again. I'll eat nothing again.

Speaker 11 Yep.

Speaker 1 Ever. Like 40 years later, it still turns your stomach.
You know, it's like, I am never,

Speaker 1 you're just smelling it. It's just, it's the same.
That's the way I feel about debt. And once you fight through this, you'll feel that way about it.
John's right. So, no, you mathematically,

Speaker 1 relationally,

Speaker 1 psychologically, spiritually do not need to sell your house. Nothing in this call says says you need to sell your house.
And if you needed to, I'll tell you, because I love you and I want you to win.

Speaker 1 And I think you're going to win. And I just, I can hear, it's funny, John, doing this all these years, I can hear in their voice sometimes

Speaker 1 that they're getting ready to do it. They're done.
This guy's, he's got that thing in his voice like, I'm going to,

Speaker 1 I've had it. Yeah.
So bad, he's had it so bad. He's willing to sell his house.

Speaker 11 I'll sell everything. Yeah.

Speaker 1 I'll do whatever. Whatever.
I've had it.

Speaker 1 The great Les Brown, the great motivator back in the the Zig Ziglar days, used to do a whole talk on that.

Speaker 1 He was like, when you get sick and tired of being sick and tired, you know, and you finally look around and you say, I've had it. That's when you're about to change your life.

Speaker 1 And you can hear that in people's voice, in their sentence structure, in their tone when they're talking to us.

Speaker 1 And so many years of being able to just listen to them and not see their body language, but hear it in their voice.

Speaker 1 He's got that thing. I think I predict Mike and his sweet wife are going to be multimillionaires, and it started today.
Today, day one.

Speaker 1 Or it started three days ago when they started talking about this, and we gave it a little boost today, one of the two, something like that.

Speaker 1 But yeah, when you're willing to do whatever, there is nothing that can stop you. Yeah.

Speaker 11 I have recently become obsessed. It's probably too dramatic of a word, but pretty close to the idea of

Speaker 11 what is

Speaker 11 the hardest way I can do something great or do something well versus what I think I've spent the last 20 years. What's the easiest way I can get through this thing?

Speaker 11 The the neuroscience keeps coming back that when your body doesn't want to do a thing and you go do that thing anyway, it the cascade of benefits is so beyond the accomplishment of that thing.

Speaker 11 And at the same time, we live in a culture where, Dave, I was looking up, I was trying to find a part for the mower. Hank and I were working on a mower and a writing mower that I got.

Speaker 11 And right when we got it all fixed up, the belt broke. I just opened ChatGPT and said, what is the belt product number for this? And it gave it to me.

Speaker 11 There's no friction at all anywhere for anything anymore. And it's like, do you want to order it here? And I now want to.

Speaker 1 That doesn't disturb me. When iRobot shows up and puts the belt on for you, now I'm getting pissed.
I'm just right. Here's the thing.

Speaker 11 Like, I like the idea of sitting down with my son and going to tractor supply and looking through it. And it takes so much longer.

Speaker 11 And man, when that thing took off across the yard, watching him cheer, watching me cheer, like we did a thing together and it was hard. And the benefits were beyond just replacing that belt.

Speaker 11 And so I like the idea of taking, okay,

Speaker 11 18 months, I bet we can do it in 13 and we're going to figure this thing out. And you will have a different kind of marriage on the other side of this beyond just being out of debt.

Speaker 11 It's everything all at once and it's amazing.

Speaker 1 Yeah, when people do that stuff, they sell the knife collection. They sell everything.
They sell the gun.

Speaker 11 And they lose 30 pounds.

Speaker 1 It's weird.

Speaker 11 And they don't talk bad about each other at the water cooler anymore. It just changes everything.

Speaker 1 Yeah, they like each other because we're working together. Don't you mess with my wife? Don't you mess with my husband? All of a sudden, we're a team now.
We're locked.

Speaker 25 If you're a teacher, you're not just shaping minds, you're shaping future decision makers. Most students don't realize they're part of the economy.

Speaker 25 Every scroll, every part-time job, every shopping spree is a money move that drives the system. So, this year, you can help students understand the world they're already living in.

Speaker 25 Our brand new high school curriculum, Foundations and Economics, is packed with engaging videos, hands-on activities, and real-world examples.

Speaker 25 Check it out today at ramseysolutions.com/slash economics. That's ramseysolutions.com/slash economics.

Speaker 1 Abby is with us in Virginia. Hey, Abby, what's up? All right, how are you guys? Better than I deserve.
How can I help?

Speaker 20 So, I am an applying medical student this year, and my family has an exchange student and my mother informed me that they're going to be using my $529 to pay for our exchange students' education here in America.

Speaker 20 And I'm worried about how much debt I'm going to be collecting from medical school.

Speaker 1 Okay, so there's a 529 account that you thought you were going to get to use for school. How much is in it? Yes, sir.

Speaker 18 That I don't know.

Speaker 12 My mom has never disclosed it to me.

Speaker 20 But she's the one who put in majority of the money. My father didn't really put in much

Speaker 20 of his income into it because he was in the Army.

Speaker 1 Okay.

Speaker 20 I currently am receiving benefits from the VA to go to a university.

Speaker 1 Okay. And that's for undergrad or for med school?

Speaker 20 Undergraduate. So it'll stop at the end of the four years that I used to.

Speaker 1 All right. And what um

Speaker 1 and then you're going to go to med school to become an MD?

Speaker 1 Yes, sir.

Speaker 1 That's the hope. When will you finish your four years?

Speaker 20 I'll finish this year in 2026.

Speaker 1 Okay. But as far as you know, there's enough for the exchange students and

Speaker 1 exchange student and your medical. You don't know how much is in there.

Speaker 26 I don't know how much is in there.

Speaker 20 My mother

Speaker 20 said ballpark is over 400K, but she doesn't know.

Speaker 20 She knows, but she won't just tell me the actual number itself.

Speaker 12 Okay.

Speaker 1 All right. So I get to learn something on this show.
I've been doing this show for 30 years, and I get to learn something brutally every so often when I screw up an answer on the air.

Speaker 1 And about three weeks ago, I screwed up an answer on a 529, and I've gotten trashed for screwing up the answer. So I've thoroughly learned about 529s, what I didn't know in the last three weeks or so.

Speaker 1 So here's the correct answer because, and I screwed it up before and I'm not going to this time.

Speaker 1 You don't own the account, Abby. She does.
She can do with it what she wants to do with it. Yes, sir.

Speaker 20 So would I take out loans for medical school?

Speaker 1 Wait a minute. I don't know on what planet she can't help an exchange student and still have enough left for you to go to medical school out of $400,000.
Yeah.

Speaker 1 Why are you whining about this?

Speaker 11 There's like a bigger conversation to be had.

Speaker 1 Why is it that your mother is why are you and your mother at odds?

Speaker 20 Because my mother believes that I should take out loans for medical school like she did

Speaker 1 for her graduate program. So

Speaker 1 she doesn't want to use the 529 for you to go to medical school, regardless of the exchange student.

Speaker 20 Yes, sir. But she then told me she's going to use it for the exchange student instead of for me, and that's like where some of the tension lies.

Speaker 1 Not really. The tension just is that she doesn't want to give it to you for med school, period.

Speaker 11 She did pour salt in the wound and say, but I am going to give it to this other kid.

Speaker 1 That's not even

Speaker 1 a family member. It's not you, yeah.
I'm not even sure she can do that, by the way, without getting penalized, but I don't know the answer to that, and I'm not going to answer something else.

Speaker 1 I don't know the answer to that. So, but the,

Speaker 1 yeah,

Speaker 1 maybe she can. I've never read that you can give it to an exchange student.

Speaker 1 Only siblings and people in the family, you could give it to your, she could give it to your husband, you give it to your wife, you could give it to your uh parents, you could give it to your kids now, but I've never heard exchange student.

Speaker 1 Maybe you can, though, maybe you can. Uh, it doesn't matter, though.
That's not the core issue. The core issue is she's not gonna give it to you anyway.

Speaker 20 Yeah, I understand. That's fair.

Speaker 1 Yeah, why, what's her reasoning?

Speaker 11 It's like it sounds like an old like frat bro, like, I got hazed, so you get hazed.

Speaker 11 Like, she should be the one saying how ruthless it was trying to pay back student loans and be a new mom and all that kind of stuff. So I have almost a half a million dollars in an account.

Speaker 11 I'm going to take care of you.

Speaker 20 So I have paid for all of my medical school applications. I'm paying for all of my flights to and from interviews at other medical schools.

Speaker 1 Are you a

Speaker 1 tank?

Speaker 10 Yes, sir.

Speaker 1 Okay.

Speaker 10 Wow.

Speaker 18 So I am paying for everything.

Speaker 20 I pay for my rent.

Speaker 20 I, yeah, I do pretty much everything.

Speaker 18 I have a job.

Speaker 1 Okay, there's something deeper here.

Speaker 11 What's the tension with you and your mom?

Speaker 20 This exchange student has lived with us for four years trying to get an associate's degree and has not yet completed it.

Speaker 11 I know. Let's take a look.

Speaker 1 The exchange student is a symptom. They're not the problem.
What is the problem? The problem is your mother and you.

Speaker 11 Yeah, what is going on?

Speaker 20 I honestly don't know. I

Speaker 20 appreciate my mom.

Speaker 11 You don't know, really?

Speaker 20 I genuinely don't know. I have a feeling it's because she went through this whole process without any help from her parents and expects me to do the same.

Speaker 11 Well, I can tell you, I went through some things all by myself without my parents' help, and I'm making dang sure that my son doesn't do that.

Speaker 11 And there's some things that I had to do that were really hard that I'm making sure he does because it's appropriate. But

Speaker 1 okay, number one, let's Sabby, let's set this aside. The exchange student is not causing you to go to med school with student loans.
Your mother is. She has the money to do both.

Speaker 1 Okay. So take the exchange student out of the conversation completely.
And then

Speaker 1 if I were in your shoes, you're not going to like this, but I simply wouldn't go to med school. I don't think you can afford to go.

Speaker 1 She's not willing to help you, and I'm not going to tell you to go $250,000 in debt to go be an MD.

Speaker 1 Not in the current medical climate. I think it's financial suicide.

Speaker 1 I know it's your dream and it's your A game and it's what you've been wanting to do your whole life and yeah, yeah, yeah, yeah, yeah, yeah. And you're going to do it no matter what I say.
I know that.

Speaker 1 But I'm not going to leave this call without telling you the truth. And the truth is you should not do this.

Speaker 1 And then you should call your mom up and say, based on the fact I've got to go into student loan debt, I've decided not to go. Yeah.

Speaker 11 I agree with Dave, but I also think it's worth sitting down at a table and asking your mom what happened.

Speaker 1 What in the world is wrong?

Speaker 11 Yeah, what did I do?

Speaker 11 I had this amazing opportunity ahead of me.

Speaker 1 Did you go at her after the divorce with your dad and she never got over the fact that you got at it? You know, you took his side? Or, I mean, what happened?

Speaker 11 Yeah, pretty gnarly.

Speaker 1 Or this woman is just wounded from something else, and she's taking it out on her kid. I don't know.
But this is a game of cat and mouse. I don't want to be in.

Speaker 11 I would opt out of the game. Yeah, that's exactly right.

Speaker 1 I'd step out. And Dave's right.

Speaker 11 Even

Speaker 11 at the highest case scenario, she could put $100,000 towards this other student's tuition and still have $300,000 for your school.

Speaker 1 And you can still go to school.

Speaker 11 So it's not about her.

Speaker 1 Choose a school you can afford. If you've got $250,000 of cash laying there, choose a school that's $250,000 or don't go.

Speaker 1 Find one that gave, because you can find it in med school and get through for that.

Speaker 1 But if she's making pay for a pair of people. And no one asks the doctor where they went to school ever.

Speaker 11 Yeah.

Speaker 11 If she's making you pay for flights, if she's got 400K and she's not paying for tuition, your senior year, helping you with rent, there's other, there's something underneath all of this that is borderline pathological or mom just thinks she's toughening up her daughter.

Speaker 11 And then you have to live in that mathematical reality. I simply don't have the money to go to med school right now.
And I'm like Dave.

Speaker 11 I know too many medical doctors whose kids are going to school and they're still paying on their student loans. And so I can't in good faith tell you to do that right now.

Speaker 1 And John has a PhD in higher education. So he doesn't know actually what this is.

Speaker 11 It's tough, man. It's tough, tough, tough, tough, tough.

Speaker 1 Yeah, I'm sorry.

Speaker 11 I hate it for you.

Speaker 1 That's,

Speaker 1 you know, there's a... a thing where you teach your kids to do hard things

Speaker 1 and then there's a thing where you're just being a jerk right

Speaker 11 Or it's like I'm gonna, I'm gonna box my kid around the ears because I know the world's tough and they're gonna get boxed around the ears a lot.

Speaker 11 And what you end up doing is beating your kid down so much before they even get into the world. And there's something about teaching your kids strength and discipline and resilience.

Speaker 11 And then there's something about kicking your kids' knees out from under them before they leave the house. And so if, yeah, to this mother, congratulations, you win.

Speaker 11 You're going to have 400 grand in an account, and you have what sounds like a pretty hardworking, amazing young woman who's going to have her dreams diverted.

Speaker 11 Either she's going to go into catastrophic debt trying to prove herself, or she's going to have to go do something else, robbing a generation of potentially a great young doctor

Speaker 11 because you want to be right. So, congratulations on being right and altering everything here.

Speaker 1 Yeah, that's just

Speaker 1 but you're a tough old bra. You proved her.

Speaker 11 You showed her. Congratulations.
You showed her. Give me a break.

Speaker 22 Hey guys, Rachel Cruz here, and guess what? The 2026 Ramsey Goal Planner is here.

Speaker 22 This isn't just another calendar, it's a life-changing tool that helps you set clear goals and build habits that actually stick.

Speaker 22 Get ready for all new monthly content from your favorite Ramsey personalities, tactical goal tracking tools, and upgrades that make this our most durable planner yet. But don't wait.

Speaker 22 If you order in the first week, you'll get the lowest price at just $35.97. Order by Labor Day at ramseysolutions.com/slash store to get the deal.

Speaker 1 In the lobby of Ramsey Solutions on the debt-free stage, Jonathan and Sashia are with us. Hey guys, how are you? Hi, good.
How are you? Better than I deserve. Welcome.
Where do y'all live?

Speaker 1 Savannah, Georgia. Fun.
And how much debt have you two paid off? $373,346.

Speaker 1 Way to go.

Speaker 1 How long did that take? 16 months. Good for you.
Whoa. And your range of income during that time? Started out $90,000 and ended up $530,000.
Okay, that's bizarre. Yes.

Speaker 1 Who got a job? What in the world?

Speaker 27 So that's me.

Speaker 1 That would be you. Yes, sir.
Okay, so I'm assuming you're not going to know or something. You must have come out of med school, huh? Yes.
Okay, and so you went from making nothing to making 400. Yes.

Speaker 1 Or something. Yes, sir.
Way to go. What specialization are you in?

Speaker 27 So OBGYN.

Speaker 1 Oh, wow. Good for you.
Thank you. That's the most fun kind of doctor.
Babies, babies, babies. Yes.
It's the only time people are happy to be in the hospital. Yes.

Speaker 1 Absolutely. Very cool.
Good for you. That's

Speaker 1 400K from nothing. So 373 is not a house.
That was med school.

Speaker 27 All student loans.

Speaker 1 Wow. And you just said,

Speaker 1 we're going to pretend like we're not making any money. We're going to pay off the loans in 16 months.

Speaker 27 That's exactly what we did, Dave.

Speaker 11 So you heard us telling somebody on an earlier segment.

Speaker 27 I said yes. That was the seed that was planted for our story.

Speaker 11 Okay, tell us about this adventure.

Speaker 27 So the journey really started in 2019 whenever I graduated medical school, staring at six figures of debt and it was smothering it was hard to breathe so we went through residency not making much our goal then was just let's not make that number larger right so we lived well beneath our means we had twins yes so we went through all of that

Speaker 27 we have a teen so we got her through school and we were like let's just keep this number steady.

Speaker 27 And then when I graduated training, it was like, let's live well below our means, live like a resident, literally, and pay everything onto this debt.

Speaker 1 You do. That's what we did.
Just exactly like we described. That's incredible.

Speaker 1 So when did you get connected to the Ramsey stuff?

Speaker 27 So I heard about you in medical school

Speaker 27 just from students talking about it. We were all wondering, how are we going to pay off these loans? And some people really wanted loan forgiveness, and some people talked about Dave Ramsey.

Speaker 27 And I said, well, well, the loan forgiveness doesn't sound very good. So let me look into that.
And so you were simmering for a long time before we could press play.

Speaker 1 Wow, okay. Yes, sir.
So you had it all lined up. And then as soon as you get out, boom, we're hitting this, hit that end domino and go.
Yes, yes.

Speaker 27 Residency was tough because we wanted to, but we just didn't have the means.

Speaker 1 Yeah, you didn't have enough margin then.

Speaker 11 But even having the courage and the grit to hold the line. Yes.
You say, okay, we've dug this big of a hole.

Speaker 1 That's a tough order with, what, three kids? Yes.

Speaker 11 And you in residency, which means you're working 900 hours a week. Yes.

Speaker 11 And

Speaker 11 you're holding down everything. Yes, sir.

Speaker 1 Still does.

Speaker 11 To just say we're holding the line, that's really tough. That's like doing bench press.
And instead of like pushing it all the way up, it's just holding it.

Speaker 1 That's hard, man.

Speaker 11 That's really tough.

Speaker 27 Yes, absolutely.

Speaker 1 Congratulations. Yeah.
Thank you. Amazing.
The great news is, is now. Woohoo! Yes.
Wow. You're going to be able to do amazing stuff.
Yes. Do you have a mortgage? We

Speaker 1 just bought a house. We just bought it last month.
Good. Right after this.
Okay. Yep.
And now turn around and get it paid off. Exactly.
All right. Cash flowing.
What do you owe on it?

Speaker 1 $5.85. Okay.

Speaker 1 We haven't even got our first mortgage payment. So

Speaker 1 what is your plan on it?

Speaker 27 So we're on a 15-year fix. Shout out to Amy Jo with Churchill Mortgage.
She was amazing. But our plan is to get that paid off hopefully in five years.

Speaker 1 Yeah, good. That's perfect.

Speaker 11 And the fact that y'all didn't go out and buy a $7 million home.

Speaker 27 It was tempting.

Speaker 11 I bet it was. I bet they said you qualify for any home you want.

Speaker 1 Yes, we qualify for $2 million. It was crazy.

Speaker 1 And we didn't, we said, no, we don't need a $2 million house. Amazing.
Well, you will someday. Yeah.
But not now.

Speaker 1 Won't be long.

Speaker 1 Amazing. No, y'all.
Thank you. Thank you.
I'm so proud. How does it feel? It feels good.

Speaker 1 The excitement part for me was every time we made that payment, it's like you make it, let's keep going, let's keep going, let's keep going.

Speaker 1 And that was the, that was, that's once we made the last payment, it was like, this is it. Yeah, we're done.
Yes. We are done with this.
How'd that feel when you hit that last button?

Speaker 27 It was amazing. It was amazing.

Speaker 1 How much dancing around the living room was there? That was a lot.

Speaker 1 Champagne cork going off. Yes, for sure.
That's great. Submit no more student loans.
Done, baby. That's it.
Mic drop.

Speaker 11 Okay, how many of your classmates that you graduated with

Speaker 11 are debt-free debt-free right now?

Speaker 1 16 months away. Minimum.

Speaker 27 Zero.

Speaker 1 Zero. 10%.

Speaker 27 Zero.

Speaker 27 I work in a large practice and nobody who got out a residency. It was a primary goal for them.
And it was hard. You mentioned Doc Idis.

Speaker 27 You know, I had a lot of colleagues, a lot of classmates with brand new cars, new homes, vacationing, and we're just thrift shopping and living below our means and pushing through.

Speaker 27 But now they're like, man, you did it right. You know, so I'm inspiring them even now, hopefully, to try to make those changes.

Speaker 27 And hopefully this story will help those people in medical school or graduating residency. You know, it can be done.
It's hard. It's so hard, but it can be done.

Speaker 1 373,000 in 16 months.

Speaker 11 Yes. That's just not messing around.

Speaker 1 That's pretty studly. That's pretty studly right there.

Speaker 11 Jonathan, what was it like keeping everything duct taped and bailing wired together over those many years?

Speaker 1 It was hard. It was hard.

Speaker 1 Because

Speaker 1 we had the older daughter and then the two twins.

Speaker 1 It was a lot to keep up with.

Speaker 1 I would probably say the good thing for me is I like everything to be on the schedule. So once everything was on a schedule, it made it a little bit easier.

Speaker 1 But the hardest thing is just not being able to see her. And I've got to give a shout-out to her.
She worked extremely, extremely hard.

Speaker 1 I mean,

Speaker 1 I can't say enough. You know,

Speaker 1 she dug and dug and dug. There was a lot of nights.

Speaker 1 We didn't see each other, didn't hardly talk. We may have texted a little bit, but I've got to give her a lot of credit on that.
And, you know, I knew that

Speaker 1 it was hard, but I could see the light at the end of the tunnel. I said, I know it's coming.
I know it's coming. Just, you know, we just got to dig in there and just keep going.

Speaker 11 I can't wait for a few years from now when that older teenager comes home and sees the clothes these young twins are wearing and says, hey, wait a minute.

Speaker 1 Oh, yeah. Oh, yeah.

Speaker 1 Like, what about me?

Speaker 11 We're goodwilling it when I was that age, and now we're

Speaker 1 amazing.

Speaker 27 But she's seen the grit, and she's, you know, she's in college. We second week this week.

Speaker 11 Oh, you've changed her life. Changed her life.

Speaker 1 Changed her life. Yes.

Speaker 27 Able to cash flow her college.

Speaker 1 But she has no excuses.

Speaker 11 She watched her mom and her dad just be gangsters.

Speaker 11 She has no excuses, man.

Speaker 11 But not from words. She got to watch you guys do it, which is the most powerful lesson a parent can give.

Speaker 1 It's amazing. And you're not going to put her in student loan debt to teach her a lesson either.
No,

Speaker 1 no.

Speaker 1 Man. So she can learn grit.
No, cool, guys. This is so cool.
We've had those calls today. It's crazy.
Absolutely crazy. Wow.
So proud of y'all. Thank you.
So, how does it feel?

Speaker 27 It feels amazing, you know, to be able to just...

Speaker 27 Work, earn money, and you keep it all. You know, you put it towards things that are going to build your future home, our first home ever.

Speaker 27 We're able to now start and save for retirement.

Speaker 1 How long have y'all been married? Seven years. Seven years.
Yeah. So, what? What's the you bought the house? That's a good, that's a good first thing to do.

Speaker 1 What's the next, the next second thing you're going to do just to celebrate and enjoy some of this?

Speaker 1 I want a truck. Yes.
There you go. He needs a truck.
I need a truck. You do need a truck.

Speaker 1 You do need a truck. What are we going to get? What are we going to get? I want a Denali, Chevrolet, or GMC Denali.
Yeah, that's a nice truck. Yes.

Speaker 1 Funny, on the way, on the drive up here, my battery went dead on the side of the road.

Speaker 1 No way, it did. Yeah, I replaced it in the parking lot of auto zone.
What Jasper did is he? All right, let's get on it.

Speaker 11 We're about to run out of time. Let's count them down.
Awesome. Thank you.

Speaker 1 $500,000 a year. I'm changing the battery in the auto zone.

Speaker 1 I like it. I like it.
Count it. All right.
$373,000 paid off in 16 months, making 90 to 530. Count it down.
Let's hear a debt-free scream. Three, two, one.

Speaker 1 We're debt-free.

Speaker 1 Yeah,

Speaker 1 11.

Speaker 1 Get the man a denaly.

Speaker 1 Our scripture of the day, Proverbs 16:9: In their hearts humans plan their course, but the Lord establishes their steps.

Speaker 1 Milton Friedman said, if you put the federal government in charge of the Sahara Desert, in five years there'd be a shortage of sand.

Speaker 1 Yep, that'll work.

Speaker 1 If you're tired of living paycheck to paycheck and feeling like you can't get ahead, join one of our free every dollar trainings.

Speaker 1 There are new trainings every month this week, and they're all hosted by one of the Ramsey personalities.

Speaker 1 We're going to show you how to stick to a budget and even find thousands of dollars worth of margin using every dollar.

Speaker 1 You get out of debt, you build wealth, and you can ask us any question during the live Q ⁇ A. You're going to love that.

Speaker 1 So Rachel, Cruz, Jade Washaw, and George Cammell are doing these live in-person webinars on how to build your budget out and how to become wealthy and how to get out of debt so that you can become wealthy.

Speaker 1 Ramseysolutions.com. Sign up for free.
Ramseysolutions.com slash webinar. Be sure and check that out.
Nick is in Knoxville. Hi, Nick.
How are you?

Speaker 8 Hey, Mr. Ramsey.
Thanks for having me today. I really appreciate it.
And Doctor, you as well.

Speaker 1 Thank you.

Speaker 8 I got a, I'm very fortunate in my life.

Speaker 8 I inherited a pretty good chunk of money from my grandfather and my grandnie and pop

Speaker 8 their estate when they passed away. My wife and I have no children.

Speaker 8 We're very conservative. We live conservatively.
We live below our means.

Speaker 8 We already are doubling up on our payments on our home. We currently owe about $212,000 on it.

Speaker 8 And the money that I have is, I've completed phase one, basically. It happened in 2022 when my grandfather passed away.
He was with a longtime financial advisor.

Speaker 8 And I had to kind of break the ties with him because it was all invested in like one chunk of the company that he worked for. So I had to diversify it, which was very difficult.

Speaker 8 So I went with a good family friend of ours with a large Prime Merica financial institution, which you're familiar with, Mr. Ramsey.

Speaker 8 And it was all diversified.

Speaker 8 And so I've kind of got over that now. And I'm like, do I pay the home off?

Speaker 1 How much is in the account?

Speaker 8 Right now, 1.639.

Speaker 8 And not all of that is my grandparents. I've saved up a whole lot

Speaker 8 during my career.

Speaker 1 Why would you you not pay off your house before now why would you not just do that automatically it's a it's an irrelevant amount of money if you got a hundred a million six

Speaker 8 yes sir um so the reason being is because my you know a financial advisor friend of mine and then the financial advisor through prime merica also was like well you're making money on this money and you're fixed at a two two and a half percent interest rate um with your mortgage and you can make ten percent so based on that these idiots would tell you to go buy a meet borrow a million dollars on your house because you could make a spread on it.

Speaker 8 Well, that's why I'm calling you to say.

Speaker 1 No, I mean, that's what these idiots are telling you. It's the same deadgum, stupid thing.

Speaker 5 Yeah.

Speaker 1 But they don't make any money when you pay off your mortgage, they only make money when you buy stock from mutual funds from them.

Speaker 1 Their commission is not based on your debt reduction, it's based on how much you keep with them under management.

Speaker 5 Yeah, yeah,

Speaker 1 they're a vice suck.

Speaker 11 Yeah, they're ripping you off.

Speaker 1 This pisses me off, yeah. And then they drop my name to boot.

Speaker 1 Yeah, pay off your house today, man.

Speaker 11 Yeah, pay it off today.

Speaker 1 And change financial advisors again.

Speaker 1 And get one to have some dadgum sent. Yeah, they're lying to you, brother.
Telling you to stay in debt when you've got a million six in your account and you only owe $200,000 on your mortgage.

Speaker 1 That's just asinine.

Speaker 1 Yeah. Has nothing to do with Dave Ramsey.
I can tell you that.

Speaker 1 Or go Drop my name and then give that advice.

Speaker 11 Just ask what would it be like to sit at a table with your grandfather

Speaker 11 who's seen a few things.

Speaker 1 What would your grandpa do? He'd say, if you're kicking your butt more than I am, don't own your house outright.

Speaker 11 Do it right now. Don't make these other men rich gambling off of your off your spread.

Speaker 1 Yeah. Nope.

Speaker 11 Dave, that makes me so mad.

Speaker 11 It makes me irrationally angry. I'm glad you got angry for both of us, but geez.

Speaker 1 I got two dips, one bad bad advice and one drop in my name to give the bad advice. So I double-dipped on the anger.
But yeah,

Speaker 1 no, no, no, no, no, no. Yeah.

Speaker 1 And Nick, another thing I do, number one, I use common sense when I'm applying these things. And I've never had anyone in 40 years of doing this show, it's approaching 40 now,

Speaker 1 tell me that I gave them bad advice when I told them to pay off their house. I've never had a single person send me hate mail that said, I paid off my house and I hate you.
You're awful.

Speaker 1 And if you pay off your house and you hate it, you can go get you a new mortgage. They'll give you another one.

Speaker 1 So if you hate being debt-free, I've never had that experience ever.

Speaker 1 And all the data tells us among the millionaires that we've studied, not broke financial people selling you mutual funds, but real millionaires, that the paid-off house is one of the key elements of becoming a multimillionaire

Speaker 1 because it sets you free. You don't have anything to think about anymore.
I promise you, the grass feels different under your feet when you walk out in the backyard with no shoes on and no mortgage.

Speaker 1 My grass, shut up, because there's risk involved. We've done detailed research, and 100% of the foreclosures occur on a home with a mortgage.

Speaker 1 So, yeah, go to ramseysolutions.com and click on Smart Vestor Pro and find a Ramsey Smart Vestor Pro in your area that will give you good advice instead of that clown show you're with.

Speaker 1 Yeah.

Speaker 1 Man.

Speaker 1 All right. Katie's in New Hampshire.
Hey, Katie, what's up?

Speaker 1 Hey, guys. Thanks for taking my call.
Sure. How can we help?

Speaker 26 So my husband and I are first-time homebuyers, and we've been paying extra to the mortgage.

Speaker 26 But we've been seeing how much interest we've been paying versus the amount that's actually going to the principal.

Speaker 26 And after talking to my in-laws, they highly recommended HELOC as they said that it's just interest payments, which is not a lot compared to the interest that we're paying now.

Speaker 1 Your in-laws don't know how to do the math. Yeah, they don't have a calculator.
It's not how it works. Okay,

Speaker 1 you have a conventional mortgage, right?

Speaker 10 Yeah, we do. Okay.

Speaker 1 Your conventional mortgage is calculated exactly like a simple interest HELOC.

Speaker 1 Exactly.

Speaker 1 Okay, you're not prepaying interest on the front end. You're paying interest based on the current interest rate of your mortgage and the outstanding balance as of this month.

Speaker 1 When you pay a principal balance, you slide forward in the amortization schedule.

Speaker 1 So if you put $10,000 extra on the principal balance, it's not next month on the AMS schedule.

Speaker 1 It's $10,000 worth of principal reduction forward because that amount of interest is charged on that $10,000 less balance. So the

Speaker 1 amortization schedule is calculated as if it were perfectly done simple interest. And a HELOC is simple interest as well.
So your in-laws are under the mistaken impression,

Speaker 1 it's a fallacy that's believed out there, it's mythology, that because mainly what you pay on the front end of a mortgage is interest, that you're prepaying the interest on the front of the mortgage.

Speaker 1 You're not. You're paying the exact amount of interest due.
The reason it's so high is it's the highest your balance is ever going to be.

Speaker 1 As your balance goes down, the amount that goes to interest goes down, and the amount that goes to principal goes up because you have a fixed payment all the way through.

Speaker 1 Okay, that's how the actual math works. So bless your in-law's heart, honey.
Don't take financial advice from them. They're math challenged.
And that's not how this works.

Speaker 11 They'll give you a good husband, and let's just call it.

Speaker 1 Yeah, they made a good husband, and he's a good boy, and we'll move on. She makes a good casserole, but we're not taking math from her.
I'm just.

Speaker 1 Okay. Okay, Dave, help me with this.

Speaker 11 I know we're running out of time. Yeah.
And this segment's about to be

Speaker 11 brought to you by Preparation H because the hemorrhoid's getting a little bit out of control with how frustrated I'm getting.

Speaker 11 Teach me about why that would even, even under the scenario you drew, they're mistaken understanding. Why would taking out a loan against your house somehow be better?

Speaker 1 Well,

Speaker 1 if you were prepaying the interest somehow and you could avoid that by paying down the principal, then borrowing money at simple interest to do that would mathematically make sense.

Speaker 1 But there's no such thing. It's not how it works.

Speaker 11 Would the bank come up with a loan and just cross their fingers and hope that nobody figured out that sophisticated response?

Speaker 1 Well, there's been more than one hack on the internet over the 30 years I've been doing the 40 years I've been doing this, so there you go.

Speaker 1 Here we go. I'll always be in business, John.
You always got a job.

Speaker 11 You're always going to have work to do, my brother.

Speaker 1 There's always work to do between financial planners and in-laws. And in-laws.
Here we go. That puts this hour of the Ramsey Show in the books.
We'll be back with you before you know it.

Speaker 1 In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

Speaker 13 Up next, we are headed out to Chicago and Orlando for the Ramsey Show Live. Yep, you heard me right.
We are taking this show to you.

Speaker 13 This is going to be everything you love about the Ramsey Show, except you get to be a part of it.

Speaker 1 Part of what, George?

Speaker 13 The Ramsey Show Live.

Speaker 1 Again, that's what I'm telling them about.

Speaker 11 Ramsey Show Live in here?

Speaker 13 Nope, we're doing it on the road. You're going to Chicago with me and Rachel Cruz September 30th.

Speaker 1 Are you free? The windy city.

Speaker 11 I like it that time of year.

Speaker 1 You know what else I like, George? I like the deep dish. Okay.
Maybe we'll have some deep dish.

Speaker 13 You mind if I finish the promo? Is that okay with you?

Speaker 1 Okay. Okay.
Appreciate that.

Speaker 13 Questions and answers, real conversations, and I'm sure a few surprises here and there.

Speaker 22 George, are you in here talking about TRS Live?

Speaker 13 I am, Jade. I'm trying to talk about it.

Speaker 1 Nice. So that means it's actually happening, right?

Speaker 13 It's happening. If I could tell the people, I think it could actually come to fruition.

Speaker 25 Listen, just tell me when and where.

Speaker 1 You don't know?

Speaker 13 Okay, we're going to Orlando. You're going to join Dr.
John Deloney and I October 2nd.

Speaker 1 Yes. Okay, great.
I'm going to go pack now.

Speaker 13 Please, please do that.

Speaker 1 Go pack.

Speaker 28 Hey, George, speaking of packing, is this like sweater weather or is it not that cold yet in Chicago?

Speaker 1 What is happening?

Speaker 13 Can I please just get to how they buy the tickets?

Speaker 25 Geez, I thought it was a good question.

Speaker 13 Okay, this is not an arena tour. This is a one-night-only event in Chicago and Orlando.
General admission is only $39. Plus, there's a VIP experience if you're bougie like that.
But here's the thing.

Speaker 13 There's only 300 seats available. So get your tickets now at ramseysolutions.com slash events.

Speaker 11 Hey, how come you get to go to both cities?

Speaker 13 I just go where they tell me, man. Hey, have you been there the entire time?

Speaker 1 Maybe.

Speaker 13 Okay, and also, are you reading a children's book?

Speaker 11 I'm expanding my mind, George.

Speaker 13 That's how we got those PhDs.

Speaker 1 Yeah, that's probably where you got that jacket. Okay.

Speaker 13 See you on the road, John.