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Normal is broke, and common sense is weird.

So we're here to help you transform your life.

From the Ramsey Network and the Fair Winds Credit Union Studio, this is the Ramsey Show.

I'm Dave Ramsey, Rachel Cruz, Ramsey personality, number one best-selling author, co-host of the Smart Money Happy Hour.

She's my co-host today and my daughter.

Open phones at 888-825-5225.

Rachel, before we jump straight to the calls, you guys just got back from doing a Ramsey, something we've never done, the Ramsey Show on the Road.

And it was you and George and Ken in Chicago, right?

That's right.

At the Den in Chicago, this kind of little club said about 300 people.

And it was so fun.

So we took live calls from the audience.

We played some fun Ramsey show trivia, which they all knew it.

They all won the game because they're all big fans.

They listened to every show.

I feel like everyone that was there.

But it was great.

A lot of laughs,

a lot of good conversation.

And, you know, you get reactions from the audience.

They're clapping.

They're laughing.

They're

when someone asks a question, you know, and they know it's great.

It was a really fun time.

A little groan in the audience.

Yeah, it was great.

It was good.

So, and we're taping another one tonight in Orlando with Jade and Deloney and George.

That's right.

Yes.

Okay, cool.

So these are all sold out.

We're doing a little test with these.

I think we're doing four or five of them here in the fall.

And if they all go as good as Chicago, you'll be hearing us all across the country in the spring.

We'll do a bunch of them for you guys just to come out and do what we're doing right now in your presence.

And you guys get to be there and ask questions live.

And the only problem is we can't hang up on you to protect you from you.

Yeah, you can't put people people on hold.

We did learn that.

Yeah, sometimes we do that around here.

We protect you from you, but can't do that in a live setting.

It's a little harder.

I just push the button and the microphone's still standing there with that guy.

Yeah, that's it.

So, yeah, you got to be careful with that.

But hey, open phones here at 888-825-5225.

Catherine's in Grand Rapids, Michigan.

Hey, Catherine, how are you?

I'm doing good, Dave.

How about you and Rachel?

Better than we deserve.

What's up in your world?

Okay, so

my question is, how am I, as a single mom, supposed to

balance my debts and maintain my health and take care of my daughter at the same time?

Well, it sounds like the income is smaller than the outgo, probably, isn't it?

Well, it's definitely not great.

Yeah,

you wouldn't be calling me if you were making 300K.

No.

Okay, that's really not.

So, what do you make?

I make between $28,000 and $30,000 a year.

And how many children do you have?

I just have the one.

She just turned 13 months a couple weeks ago.

And I actually called into the show in April of last year when I was still pregnant.

And I did do what

was advised.

What was that?

But it's

to make sure I got a second job and work as hard as possible until my due date.

That help

it did a little bit, but

as soon as I went back into the workforce, all that I had saved up for my maternity leave and my return to work vanished with the first couple weeks of daycare.

Yeah, I bet.

Daycare is outrageous these days.

Wow.

And so you make $28,000 a year?

Yes.

Just between 28 and 30.

What do you do?

I am a groundskeeper slash student supervisor for my local university.

Okay.

All right.

And are you getting child support?

No child support.

Her father is not from the U.S.

So and we don't have any extradition with the country that he's from, so it doesn't help in any matters.

Wow.

Okay.

So he just disappeared.

Yeah.

Okay.

All right.

Catherine, do you have family in the area?

Do you have?

Yeah.

I live in the same town as both my parents and my dad's parents.

Okay.

Everybody's a little swamped themselves.

Sure.

Do you have good relationships with them in general, though?

Yeah.

Okay.

Okay.

Well, the long-term answer to your equation is more income.

Well, no kidding, Dave.

Okay.

But so what we've got to do is the long-term answer is to be thinking about what career can Catherine engage in to make $100,000 a year starting 10 years from today or five years from today, and what has she got to do to get ready for that career?

Okay?

Because obviously what you're doing, we don't want to project that out 40 years.

That's an unfun life.

Okay?

So number one thing, we start thinking out into the distant future and what has to be true.

Do you have to take a class, get a certification, get a degree in something to get to be and do something that pays more than the something you're doing now?

That's kind of basic, but that's really where we got to start.

Then we can roll back from there.

I'm sorry?

I have been looking into doing some classes with either PenFoster or Google's Coursera courses.

Okay, in order to do what?

Not

to either do something in the medical field or management.

Okay, both of those are pretty vague.

I want you to spend some more time dialing in exactly what you would be doing after you finish these courses, and I needed to pay 50 grand.

Right.

Or more.

Okay.

And so I don't care what you're doing.

We'll send you Ken Coleman's book, Finding the Work You're Wired to Do, and it's got the assessment in it, and that will help you.

We'll do that as our gift.

And so you're already thinking like I'm thinking.

Good.

That's your long-term goal.

Now, your short-term fix has got two components to it.

One is the dreaded part-time job and family helping you with the babysitting

sum.

And two is I want you to be sure you're plugged into your local church and they know what you're up against because they will help.

I have reached out to the church.

Good.

They will help.

And if I'm trying.

The only help they can really give in my area is help with like rent and utilities, which was pay some of the monthly

monthly daycare fees, but it would not be enough to cover it all.

Yeah.

Well, and it sounds like possibly that the daycare arrangement you've made is one you can't afford.

You may have to redo that.

I don't know what that is, but it's a very difficult thing you're facing.

And so it's just not an easy hill to climb.

No.

And I wonder too, Catherine, if there's anything

from home in the evenings and just knowing your experience as a groundskeeper and I'm sure there's some logistics there.

I mean, I don't know, I'm just making this up, but I'm like, if there's even like a landscape company that you could work for for eight hours a week to help with scheduling, you know, doing like some kind of admin work for them or whatever you can do from home, even just picking up a couple of hours to just create some cash buffer is going to be big.

And if the church can step in on those utility bills and rent, I mean, that will free up.

I mean, I don't know how much the rent is, but a couple of hundred bucks at the minimal

for a period of time, too.

So it's kind of puzzle piecing piecing some of this together for probably the next six-ish, 12 months until you kind of can project out possibly a job change to be making more in your full-time job.

What you don't want to do is get paralyzed and say, throw up your hands and say, oh, this can't be done, because it can be done.

What it is going to require is not a single answer.

There's not a single silver bullet.

It's turning the knobs, all of these knobs at one time.

The extra job, the church, the long-term thinking with money, the daycare arrangements, the family help, what all these stops can be turned just a little bit, then all of a sudden we start to get something that's sustainable until we can get our income up long-term.

And that's where you got to get to.

It's not going to be a singular answer.

And being paralyzed and giving up is definitely not going to be a good answer.

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Deanna's in Pennsylvania.

Hi, Deanna.

How are you?

Good.

How are you?

Better than I deserve.

What's up?

So my question for you, my boyfriend and I graduated college last, I graduated last August.

He graduated last December.

Combined, we had a little bit over $100,000 in student debt.

So you're not combined.

You're not married.

So how much do you have?

I had $60,000, and he had about $55, $60,000 right around there.

Oh, okay.

College.

Yes, yes.

And then we...

I'm set to pay mine off in December, and he's set to pay his off in December.

So we're going to be student loan-free

within just about a year.

Good free.

So, yeah, so planning long-term wise, we're looking to probably get engaged in the next year and a half.

So, one thing that we are talking about is combining finances after we are married.

And we are looking at what to invest in once we get to that point.

The next year is going to be saving up.

We're planning on having around $50,000 to put as a down payment on a house.

We don't want to really buy anything over like $150,000 and then double up our mortgage payments and pay off our house as quickly as we can.

But the one big question I had with all of this is I own my own marketing firm, so I cannot invest in a 401k where a company would match it.

So my question to you is,

would it be smart to open something like a Roth IRA to start investing in now so that we can be millionaires when we retire?

Good for you.

Well, it sounds like you're doing a lot of planning.

Congratulations.

And of course, let me clarify one thing before I go back to that question.

The house we're going to buy is after you're married to, right?

Yes, correct.

Yep.

We would not be combining finances or

buying a house together because it's very, very dangerous to buy.

It's very dangerous to buy a home with someone you're not married to.

Okay.

All right.

So now,

so it's pretty simple.

Just at that point, you would have an, let's say you're married, you're out of debt, you have an emergency fund, and you buy a home with $50,000 down.

You're at what we would call baby step four at that point.

And that means you start putting 15% of your household income away towards retirement, and then you work your budget, and you have a life, and any money you can squeeze out of it, you throw at the house and pay the house off early, which was your plan, and that's how you outlined it.

Okay, so then that brings us to how do we do 15% of our income?

Yes, I would start with two Roth IRAs.

One of you each have one.

You could start that now for that matter.

I was going to say, yeah, absolutely.

Well, after the debt's paid off.

Yeah, once your debt's cooled.

Yeah, and you can just sit down with a Smart Vestor Pro,

which is the people that

help our listeners do investing.

And they've been vetted by us, and they have the heart of a teacher, and they'll teach you.

You have available to you a couple of things with your marketing firm that you can also do as Roth.

You can do a

SEP IRA, a Roth SEP IRA, simplified pension plan it's called.

Now, do you have any employees in your marketing firm?

No, nope, just me.

Okay, then that's very easy.

So you can put up to 16% of your income with a formula.

It ends up actually being about 13 when the formula is applied.

But you can put a bunch of your income aside in a SEP IRA, S-E-P-P, simplified pension plan, okay, and simplified employee pension plan.

Now, warning: if you do hire people later and they're with you more than two of five years, whatever you put in that year that they reach that point, you would have to put in the same percentage of their income.

So it works really well for a solopreneur like you, but it doesn't work well for a small business that has five employees.

Okay, okay.

You also, in addition to that, can do a simple IRA, which is a 401k for small businesses.

Okay.

And you can set it up.

It's $15 to set the account up.

They're very inexpensive to set up.

To set up a 401k in a big company like ours is tens of thousands of dollars a year in administrative fees.

But for a simple, it's designed for small businesses.

Now, again, warning, if you have that and you hire someone, you're required to match the first 3% of what they put into their IRA if you have that simple program program going.

But point being, there's two types of ways you can get money in, and you actually can do both of them technically.

And free if you include the Roth.

And do the Roth.

And do the Roth.

So you'll be able to get to your 15% very easily.

Make sure they're all going in good growth, stock mutual funds, and they're all Roth, which is tax-free growth.

Yeah.

And then your husband, once you guys get married, can be investing as well in a 401k if he's at work too.

So you guys will be tackling it from multiple different areas, which is great.

But yeah, I appreciate the plan.

And maybe you guys fast-forward up the engagement.

You know, I'm a fan.

If you know you're going to be engaged in a year and a half, go ahead and shorten it.

Like Rachel did.

Start the process.

Get the ball moving.

Rachel and Winston came and said, we want to get married right now.

Now we're young.

Okay.

All right.

No, we waited.

You waited about 10 months.

No, no, 10 months.

10 whole months.

But I'm like, yeah.

Yeah.

There was no hope.

Good job, Deanna, though.

But honestly, very impressive.

You guys, just fresh out of college, just in the last year have a plan to pay off the debt knock it out looking forward to the down payments thinking about investing all of it I mean you are in a perfect position and time in your life to to start all of this so congratulations Bobby's in Texas hey Bobby how are you

hey Dave how are you doing sir better than I deserve what's up

I had a question is it okay to pause building the emergency fund to set up a revocable trust and a special needs trust No.

You don't need to.

You can fund those with the beneficiary of your life insurance, and the kid doesn't need a trust unless you die.

Well, the thing is, is

my

life insurance is really what I was worried about.

Like if something was to happen to me and my wife.

Like we have a beneficiary, but well make the beneficiary make a partial a portion of the beneficiary go to the special needs trust, and then the child is funded for life out of your death.

But you don't need to fund it while you're alive.

You need to go build wealth while you're alive, and that will take care of the child later, and you won't even need life insurance to do it.

Okay.

So, just finished the basic step three, and then

you said don't set up a remote trust at all?

No, I would just set it up only upon death.

Special needs trust has no value while you're alive.

It's for taking care of a special needs child if you're not there to do it, and you have to fund it with some money.

And if you don't have money, you fund it with life insurance upon your death.

But if you stay alive and you fund it with money and you say, I got a half million dollars in mutual funds 20 years from now and you say that is earmarked for this special needs child to be cared for throughout their life.

That goes into a special needs trust upon my death.

But until I die, I'm going to take care of them.

You see what I'm saying?

Yes, sir.

So you're taking on a bunch of paperwork and paying lawyers crap you don't need to be doing right now.

You just need to go get out of debt and make some money and name your, go ahead and do it, do the life insurance today where it's named into the special needs trust, and your will says the special needs trust is formed upon your death.

And so upon your death...

Do you have to do paperwork, though, in order for that to be...

Your will does it.

Your will dictates that the trust is formed upon your death.

And so poof, there's a trust now.

You die?

Poof, there's a trust.

Where does it come from?

Whoever the executor of the estate is.

They have to go form it then.

Yeah, but it's not hard.

I mean, it's two pieces of paper.

Okay, okay.

And you just, but you've got to put money in the thing for the kid to be okay, which is your real motivation, Bobby, which makes you a great dad.

What kind of life insurance do you have, Bobby?

Between me and my wife, we're looking at like 1.7.

Good.

It's great.

And so what I would do is sit down, if you're working with a Smart Investor Pro on your investing, I'd sit down and say, how much would I need to put

in an account, you know, invested in mutual funds to take care of this child?

Would $50,000 a year take care of this child?

Probably.

So half a million dollars.

So you could say of the 1.7, 500,000 goes into the special needs trust on the beneficiary statement.

So you redo your beneficiary clause on your life insurance immediately, and you do your will immediately to say special needs trust is formed, the Bobby Special Needs Trust, and the Bobby Special Needs Trust is funded with $500,000 from the beneficiary of this life insurance policy upon my death.

And then the child is taken care of, which is your goal because you're a good dad.

But you don't have to do all that crap right now.

It could all be formed and done upon your death.

What you do have to do now is do your will and change the beneficiary.

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Rachel is in North Dakota.

Hi, Rachel.

How are you?

I'm fine.

How are you guys doing today?

Better than we deserve.

What's up?

So we just started the baby steps.

We're on step number two, and this is literally our second month.

In our first month, we ended the month with a surplus of almost $3,000.

So

good.

But my question is, I have a variable income, and my husband does not.

And we have just over $9,000 in our savings.

And so I was wondering, we have four children.

so I wasn't sure if we should just keep that and then

use whatever extra money we're finding every month to pay down the debt or if we should use the savings that we have already.

90% of the time we're going to tell you to use the savings down to $1,000.

How variable is your income?

It's pretty extreme.

I'm a wedding photographer, so in the summer months, I can make, you know, $12,000, $13,000 a month, and then come December, almost nothing.

So I also own a studio that brings in some small income as well.

We rent out to other photographers, so I can make anywhere from $1,000 to $3,000 a month off of that.

And that's 12 months a year.

Correct.

Okay.

So, I mean, so your bottom is $1,000 to $3,000, your worst month.

Correct.

And what's your husband make?

My husband makes

each paycheck is $4,700, so about

just over $9,000 a month.

Okay.

All right.

Very good.

Very good.

And how much of the

when you guys do your monthly budget, Rachel, how much does it take to run your household, would you say?

So my fixed expenses and with our additional variable expenses like pets and miscellaneous home stuff is just about $9,000.

So it just clears his checks.

Okay, so if you make zero, you guys run the house, okay?

You just don't have extra.

Correct.

Then why would you need savings to pad that?

Just because you're a nervous mom?

Yeah, my kids are small and, you know, we get broken bones and fingers all the time, so it's just you just never know.

And you but you have like health insurance.

We do, yeah, through my husband.

Yeah.

And if you go to the emergency room and they send you a bill the next month, you have some wedding income to pay a bill.

Correct.

And then he has an HSA account too, with just under a thousand in that.

Yeah.

That's good.

So,

yeah, I think you are,

it's wise to be a good mom and say I got four kids, and it worries me.

It adds to my fear for us to be down to a thousand.

I don't have any problem with the wisdom of that, but the actual math is telling us that you probably don't have a problem.

Because then how much debt do you guys have left, Rachel?

Oh, yeah.

We have $40,000 in consumer debt and then on top of that, just our home, which is

but in baby step two is the only plan we're going to have $1,000 in the account.

Yeah, I was going to say, I mean, which is the best thing.

So you're going to be done in like eight or ten months.

Yeah, exactly, right?

Yeah.

Yep.

And my husband actually gets a really big bonus in March every year.

It's usually $18,000 or $19,000.

So we were just going to put it on.

Perfect.

Yeah.

So according to your plan, we should be done

like April or May the latest.

No, you'll be done in March because you're taking $8,000 according to our plan of your nine and putting it on your debt today.

Okay.

Oh, God.

Oh, God.

Spend it up a few months.

I heard her take a breath.

I'm going into the, I'm just going into like my slow statements.

But you guys can eat on your husband's income.

You may not reduce debt.

And if you had a horrible month, the worst thing that could happen is that a child breaks a bone, the HSA is used, and the $9,000 supports your family, and you brought in zero, and you're still okay.

You didn't even touch the $1,000 emergency, small starter emergency fund.

That's your worst case scenario.

So, and you're just not, that's all that's not going to happen.

And Rachel, yeah, that, and it's so fast.

Like, if you guys had 140 of consumer debt, debt,

I think, you know, and it's and it's a longer period.

There's going to be more time for something to happen, a bigger emergency.

But this is such a short period of time.

You know what I mean?

I almost would just knock it out because you just think about all the debt, all the payments, all the interest, everything that's happening.

And if you can start chopping off a bunch of that stuff really quickly, which is what the debt snowball does.

And if you're just a little bit scared, it motivates you to do it even faster.

Oh, yeah.

My last month, I brought in almost 8,000 last month

just because

I've been binging you every single day.

So it's like

you're fired up.

You're fired up.

And if you're a little bit, and if you add that fired up, just a little bit scared, it'll push you.

And I don't think you're in danger.

I would not tell you to be put your children in danger, okay?

I love your kids.

I don't want that to happen to them.

And I'm not asking a mom to be irresponsible.

Yeah.

And we're not asking to live on a thousand dollar emergency friend for 10 years either.

We're asking

five or ten months.

And the truth is, from a percentage standpoint, the amount of emergencies that come up that you can't pause the debt snowball and wait two or three months to be able to save up to pay off that emergency, then go back to the debt snowball.

That happens sometimes.

People have the ability to pause it if something happens.

Almost never.

But most of the little things that come up that people use their starter emergency fund for is smaller than $1,000.

But yeah, I mean, it's definitely like takes the breath out of you for a little bit, but you can do it.

You guys can do it.

It's a good thing.

Yeah, Rachel, I will tell you this.

You've done a great job of analyzing your situation.

You know your numbers.

You have a plan.

You're running it in your head.

And the detail of the question you asked indicates

how leaning into this you are.

So I really think you'll be done by March.

Just my experience is

the people that are paying attention and focused, and they're going on every little thing, they're doing every little thing.

We're binge-watching meeting.

I'm gathering this information.

I'm going to do this.

And we're going to put you in the brand new Every Dollar, which is going to hold your hand and make sure you're doing exactly what you're supposed to be doing.

It's going to give you step-by-step through the baby steps while you're doing the budget.

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It's off the chain.

So, hang on, and we're going to give that to you as a gift.

You guys make plenty of money.

You're going to be just fine, and you're going to be so stinking wealthy at the end of this story.

It's unbelievable.

This is so fun.

Great job, Rachel.

Good for you.

David is in Minnesota.

Hi, David.

How are you?

you?

Oh, I'm doing fabulous.

How are you?

Better than I deserve.

How can I help?

So I got an interesting one for you.

After a couple of years, after I lost my job and living in my friend's house while I get on my feet, I just got back into truck driving.

Well, now he's going to sell the house.

And

I came up with three plans on what I'm going to do next.

Either I buy a house, and I don't really have any money for a down payment.

I just finished paying off my last credit card today, or I rent a place, but I'd rather prefer to own.

Or the third option, and this is something I'm leaning towards, is living out of my semi-truck.

How old are you?

It's a company.

I just turned 30.

And I take it you're single.

Correct.

And how long would you do that?

Since I'm not going to have a credit history starting today, since I don't have any other debt or credit cards or anything else, I don't know how much of a down payment I'm going to need for a house.

That way the bank doesn't care what my my credit looks like.

So, I'm

probably at least one or two.

Yeah.

Oh, okay.

So,

if you drove a truck and lived in the truck for two years and stacked cash as a single guy and made that your home, I think that's amazing.

Yes, I would do that.

Okay, because a friend or two of mine, or I should say, my sister thinks that it's a little crazy to live out of my semi-truck.

So, your sister's married and has two kids.

How did you know?

Wow.

No wonder why you're so good at this.

That was a guess, but yeah, that's funny.

But I mean,

she has a different life than you have.

If you told me you were married and you had two kids, I wouldn't tell you to do this.

How often are you on the road, David?

24-7.

He's ready.

I know, but how often, though?

Every day?

Almost.

So my schedule is I can be home every weekend, but every now and then I will drive through a weekend just to make some extra money.

You're doing long haul runs.

Yeah.

And you got a sleeper cab, right?

You got a sleeper cab?

Correct.

Yeah.

Have at it, man.

Go see America.

Maybe for the year.

Maybe for the year.

You say two.

A year, maybe two.

Go rent for it.

For two decades.

No.

No, I wouldn't do it for two decades.

You need to come, you know, build a life at some point.

But for a couple years and get some money stacked up and get some distance between you and whatever's been chasing you.

Yeah, do it, man.

Do it.

I've been doing this show for over 30 years, and some of the saddest calls I've taken are from situations that are completely preventable.

Yeah, and what's so hard is I feel like one of those, especially the ones that I'm like, oh, it's terrible, are people that call in and their spouse has passed away suddenly suddenly and they don't have life insurance.

We actually took a question of a lady and she had three kids pregnant and husband didn't have life insurance.

And I'm like, I can't even imagine.

Or even if it was opposite, right?

If a mom passed away, there's a dad with kids and trying to figure out how am I going to afford child care?

How do I outsource some stuff that maybe she was doing?

And it just takes the grief and the sadness of something like a sudden death to a whole new level.

Like when you have to think through how am I going to pay my bills

next week.

Yeah, in the middle of all that grief.

Like it's just it is it's terrible.

So life insurance is the one thing, especially as a mom with three little kids that I'm like so big on for people to get because it's inexpensive.

Xander is the place that Winston and I actually get all of our life insurance.

And we keep re-upping it because I'm like, I just want it there.

Like there's something about that safety of knowing that you have money if something suddenly happens.

And it doesn't cost much because Xander shops among a gazillion different companies.

It doesn't cost much.

You just have to admit that someday you're not going to be here.

You got to say it out loud.

And you got to say, I'm going to say, I love you to my family by taking care of them and taking the time to put this stuff in place.

The cost of stinking pizza.

There really is.

So that is one thing to do to say, I love you to your family.

So we've used Xander for all of our family's needs for insurance for many years, including, of course, term life insurance.

To get a free quote, go to 800-356-4282.

That's 800-356-4282 or go to xander.com.

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With a Ramsey trusted insurance pro, you don't have to deal with slimy businesses or slimy salespeople because they're all interviewed, vetted, and coached by us to make sure they're not only market experts, but they have your best interest at heart.

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We'll help you out.

Carly is in Arkansas.

Hi Carly, how are you?

Hi you guys, I'm good.

How are you?

Better than I deserve.

What's up?

Thank you guys for taking my call.

I'll let you know I'm pretty nervous.

I really look up to you guys and appreciate what y'all do.

Well, thank you.

How can I help?

So for some context, I'll be 20 this month and I'm getting married in January.

Congratulations.

Thank you.

So my Cindy husband and I are trying to plan our future and just make sure that we follow the Ramsey way.

I've kind of hopped on the bandwagon that my mom has put me on the last couple months.

My biggest question is that I have an $85,000 inheritance and a brokerage account that I haven't touched since I've gotten it, but I,

when we think about putting a down payment on a house, I kind of, I just don't want to.

I'd rather pay cash.

So I'm thinking, you know, we put that brokerage account down on the house, but we want to save for the next four to five years

to add to that

house fund.

And I'm just not sure what kind of account to put that in.

Do I put it on top of the brokerage or an HYSA?

Are you wanting to use the 85 Carly for a down payment and then pay the house off quickly, or are you wanting to save that 85 plus a lot over the next couple of years to pay cash for a house?

The 85 plus the rest to pay cash.

Okay, so you guys won't buy a house for a few years, and where do you keep saving that money until you buy, is what you're asking.

So who has the brokerage account?

Well, I do, but we will.

No, I mean, is it with a company that

is doing all of your investing, or you just parked it there because your grandmother had it there, or what?

It's with my finance guy.

So with the company, I believe.

Okay.

All right.

So if you were with one of our Smart Investor Pros or with your financial advisor, if it's someone you trust, it should be in a good growth stock mutual fund.

That's what it's in.

Yeah.

And you should add to that.

A high-yield savings account pays a fourth of what the mutual funds are producing these days.

So, no,

you want to get a full ride on that.

Because it's going to be a couple of years, Carly.

If you guys were going to put a down payment or something and you were saving for

six months,

that would be fine to just do like a high-yield savings if you were starting over, starting new.

But something long-term like that, then yes, yeah, at the end of the day.

If you got a three-to-five-year window, you got plenty of time to ride the market up and down and watch what it's doing and

be perfectly safe doing that.

So, yeah,

I would sit down with that guy and make sure that you feel good, both of you and your fiancé, soon-to-be husband, feel good about the account that it's in.

What's the brokerage account invested in?

And I want to understand that.

And once I understand that, say, okay, the purpose of this is I'm thinking about pulling this money out in three to five years, and I'm going to be adding some to it for a down payment.

Is this okay?

Is this safe?

And they're going to talk you through it and walk you through it, and then you'll, you know, then you make the decision if you want to leave it exactly there or not.

But I think you probably do.

It sounds pretty good.

And I really like that

you're showing a lot of maturity because a lot of 20-year-olds that get married, they want to buy a house five minutes later.

And I love that you're willing to

take a breath.

And we want to save up even more.

We're talking about buying, you know, completely debt-free.

That's pretty incredible.

Yeah, it's amazing.

How about that for a cool goal if you're 20?

Yeah.

That's a pretty cool goal.

But I mean, she's starting with 85, which will be 100 soon.

You know what I mean?

Like, it'll start snowballing for sure with the interest and then adding to it.

So well done, Carly.

Ashley's in Washington hi Ashley hi Gabe hi Rachel how are you guys great how are you I'm so good thank you so much for taking my call today sure what's up

well um so my husband is looking to switch jobs I know he's feeling a lot of pressure and stress about this because it would be a pay cut for our family and in the past I've proven that I'm not able to stick to our proposed budget.

My husband's current job is really stressful stressful, and I would love for him to be back in a role where he loves the work he's doing and with a company that's morally in line with who he is as a person.

I want to be able to sit down with him tonight and give him the reassurance that he can make this switch and it will be better for our family.

That I'm on the same team as him when it comes to budgeting and our future.

And I'm just really looking for some guidance on this.

Okay,

to start with, you guys have a wrong assumption.

The only way my husband can do something he loves with people that have a value system that's aligned is if he makes less money.

Why the flip?

Why don't he go make more money with people that I like doing something I love?

Well, I mean, this job came up.

This job I came up with.

I know, and it sucks.

Yeah.

It's not a dream job.

It's a nightmare job.

I'm going to take a pay cut because I'm stressed instead of going and looking for a pay increase in better setting.

Okay, that's fair.

That's fair.

So just a little bit of background.

We're completely debt-free.

We have our house paid for.

Our current net worth is about $1.7 million.

His gross annual income right now is $160,000.

He would, it would be $121,000.

But here's the deal.

We would get to see him more.

So right now, with the job that he's in.

Why not take a job making 180 where you get to see him more?

Well, just okay.

So with his job, he's a paramedic.

Okay, paramedic.

Okay.

Yep, he's a paramedic, and right now he works for a flight company, and he's a manager.

So he's in administration.

He really wants to go back to doing medicine, and I really want to be able to support him in that.

I do too.

But this natural human tendency to assume that in order to go do the thing I love doing, it has to mean I get paid less is not,

it's faulty logic.

I do what I love doing.

I get paid more every day.

Right.

Yeah.

So, I mean, you know, is there a different way to skin this cat?

Yes, there is.

And so, all right, let's take that off the table.

But I really want to challenge you all on this thought train because it's,

you know, I want to support my husband, and he takes a a 60% pay cut, so he's happy.

Bull, no, no, I'm not going to support that.

Now, I set that aside.

Now, let's answer your question, though, Han, about

what the,

you want to be able to talk about sticking to a budget, right?

Yes.

Yes.

How can she do that, Ray?

Well, what's his take on all of this, Ashley?

I want to know from like the job perspective, the budget, all of it.

What's his level of involvement and conversation and effort and everything?

Yeah, so he is the one that found you.

Like he found Dave Ramsey a few, well, probably

10 or 15 years ago.

And

when Josh and I got married, he was like, I really want to do this.

So from the start,

we've been working our tail off to save,

to pay off our house, to get rid of all of our debt.

And to be done a great job.

I was going to say, y'all have $1.7 million an hour.

So the budget, Ashley, at this point, because you guys are in baby baby step seven, and we still say to budget regardless of your baby step, but you guys, you're gonna have a little bit more flexibility to move within the budget versus someone who's trying to find a thousand dollars and they're cutting stuff and they're going, right?

So, you're gonna, it's gonna be a little bit of a, it will be some discipline to make sure that you guys are tracking transactions, that you know where your money's going.

But even the detail of the budget can kind of expand a little bit.

Does that make sense?

You don't have to be as rigid.

Um, so what I, I mean, so yeah, Winston and I, like, we have a category for home where like all of our bills for the house go, subscriptions, anything we buy for the home, we have a line item for that, like throughout, you know, if it's random stuff that we need for the house.

Food's a big category.

Lifestyle is a big category.

So we have big categories in our every dollar budget.

And then within those, you guys can go as specific or as broad as you want.

But the point is, is that within every dollar, especially when it's connected to your bank, you're able to track those transactions and just stay on top of, hey, here's the amount of money we said we'd spend in these big categories, and we're going to stay within those limits.

And so it just takes some time and discipline to get that as a new habit, but totally possible, Ashley.

Totally possible.

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Welcome back to the Ramsey Show in the Fair Winds Credit Union Studio.

I'm Dave Ramsey, your host, Rachel Cruz, number one best-selling author, Ramsey personality.

My daughter is my co-host today.

Nicole is in Mississippi.

Hi, Nicole.

How are you?

Hi, Dave.

How are you?

Better than I deserve.

What's up?

So I'm having a bit of a dilemma.

Excuse me.

I'm a little nervous.

It's okay.

My fiancé and i we get married next week on friday congratulations coming up

yes very soon um we are excited about that but i am still in the mindset of my debt his debt sort of thing um

my my dilemma is um i'm having a dilemma with using my 800 i'm on baby step one to throw at my credit card that I am behind on.

And my minimum is half of my take-home pay.

So it's half of what I make in a month.

That's what my minimum is.

And that is the only thing.

I'm sorry, what is your minimum?

That's $2,734.

What do you owe on this credit card?

$13,000.

And you have a $2,700 payment on $13,000?

Yes, I fell behind for a few months.

And then

it's just interest added on and it's becoming unbearable and I don't want to that's not the normal minimum payment it's all the back payments

yes it's normally around 300 or 400

that sounds more like it okay yeah all right

so um and you bring home what five five thousand six thousand a month

about five thousand yeah yes

and you're you're getting married and he has how much debt

um Um he has about 40.

Mm-hmm.

And you only have 13?

Or you have a car and everything else or what?

So together we have about $79,000 worth of debt.

Okay, which means you have another 20-something other than this 13?

Yes.

On what?

It's personal loans.

I owe a family member.

It's a f various of other things.

Okay.

And so your household income is about 80, right?

Your income, and what's his?

So my income is about, like I said, that's $5,000, and his is about the same a month as well.

Your take-home pay, yeah, okay.

Yes.

All right.

So that's $120,000 take-home pay, and so you're probably making $150,000 or so.

Okay.

All right.

And we need to pay off $80,000 overall.

So

really,

you don't really have a minimum payment of $2,700.

You have

a single payment of $2,700 to get current.

Okay.

Right?

Because the next month it won't be $2,700.

It'd be $300.

Well, if I don't pay on it, if I don't get caught up on it.

No, if you pay $2,700, the next month your payment would be $300.

Yes, that's correct.

That's what I'm saying.

Okay.

So what I would do is just call a credit card company and ask them to roll that in and reset your payment.

Well, I called them.

I don't have a problem saying their names, Capital One.

I called them and they said that there's nothing that they can do.

And then there's nothing I can do.

You're not going to get paid.

How's that?

You get nothing, honey, if you don't work with me because I got no money.

I can't pay you $2,700.

I can pay you $300.

If you want to reset the payment, that's fine.

Probably I need to talk to your supervisor because apparently your two brain cells aren't rubbing together.

This is how you talk to Capital One.

What's in your wallet?

Stupid.

You know, I mean, come on.

Of course, they can roll that in.

They do it every day, all day long.

But you got some junior bird man on the phone up there in a cubicle, right?

And so you got to nail them.

That's what you have to do.

And then

catch them up anyway because you got to get the whole stupid thing paid off.

And remember how they treated you the next time you get ready to whip out that card or do any business with this company?

Oh, no, I'm done.

I'm not sure.

Cut the stupid thing up and let them know that we're done.

We're breaking up here.

You aren't all you were cut out to be.

I don't care which particular movie star gives me financial advice on your stupid commercials.

Oh, God.

So it would hurt me to close it

and later.

It doesn't matter.

It doesn't matter whether you close it or not, you still got exactly the same problem.

That's true.

So, you know, here's what you can do.

I just call and mess with them and just, you know, be

start out pleasure.

You're nice, Nicole.

You got to kind of

hype out your, you know, hype up your sleep.

Start out pleasant and then end up nasty before you get off.

Yeah.

Get ready to dial the nasty up pretty quick as you're on the phone if their brains aren't working because sometimes apparently they aren't.

And so, you know, now then the trick is it doesn't matter because in the end of just a few months, you're going to have a zero balance on this because you're going to get paid paid off.

Because you make $120,000 after you get married, and y'all need to clean this $80,000 up fast.

And one of the first orders of business is this credit card because it's probably one of the smallest debts you all have.

Right?

Yes.

So we're going to list that in the debt snowball, smallest to largest, and I'm going to pound their face in.

And it's going to sound like $2,000 a month or $3,000 a month, regardless of what their minimum payment is.

Your minimum payment is I want you morons out of my life forever.

Okay?

And

I'm teaching you to be a little bit angry about this because that's a good thing.

That'll push you through this and cause you to just pound their face in with the math as you're doing your budget.

You're going to take that capital one, take that capital one, take that capital one.

30 years ago, 35 years ago, American Express called Sharon and asked her why she would stay with a man that wouldn't pay his bills.

And I'm still pissed.

35 years later, I'm still pissed.

I would still find that guy if I could find him.

Oh, my God.

You know, because she called me crying at work, like, I'm thinking the same thing.

Right.

And so, oh, my God, these guys, they're just, they're just

ridiculous companies.

And, Nicole, for you and your husband, I mean, make this a year, the first year of marriage.

It's a crusade.

And you guys are working extra at night.

Like, I mean, you're just, you're high-fiving in the middle of the night because you don't see each other.

I mean, like, make it really be done with it.

Like, get really, really aggressive with this.

And then it's done forever.

And then for the rest of your marriage, you guys have no debt.

You have your whole income, no stress.

It's a beautiful thing.

And so the more intense you guys can be in this first year.

And if you guys want kids later, even before the kids, like this is the time to do it.

So if you don't pay them $2,700 and you pay them $2,100 because they're the first thing on your debt snowball and that's all you squeeze out of the first month's budget.

Or a thousand, whatever.

Or you pay them a thousand.

Whatever you pay them.

I don't care.

Then the next month you pay them a bunch more.

And the next month you pay them a bunch more.

I don't really care what they think, it's irrelevant.

Just pounding it up.

Well, what sucks is the interest, right?

You get 26% on this amount.

You know,

it's on the whole thing, anyway.

I know.

It's on the whole 13,000.

Yeah, it's true.

Period.

It doesn't matter.

The interest is the interest until you get it paid off.

Get that credit card.

Yeah, get it knocked out.

What's in your wallet?

God, money now, because I don't have you people in my life.

Yeah.

Yeah.

Oh, man.

I tell you what.

I spent the first part of my career doing a dumb thing.

I would bring in people we were coaching and I would call and negotiate with the credit card companies and set payment plans for the people we were coaching.

And it taught me to hate credit card companies because they're so moronic.

And I'm still, it still rings in my brain.

And just I, because I just know the conversation she had.

It just pisses me off still.

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Jamie's in Fort Worth, Texas.

Hey, Jamie, how are you?

I'm good.

How are you?

Better than I deserve.

What's up?

Okay.

So I have been religiously listening to you and your team every single morning on my drive to work, which is about an hour and 15 minutes.

And I have had gazelle intensity

by myself.

So I've tried introducing it like to my husband.

And the problem is, is that we've sat down and we have looked at a budget.

I have the every dollar.

I am still working on assigning every dollar,

but I've got the app for him where he's doing it.

We have about $95,000 in consumer debt together.

We're a blended family.

He has three.

I have three.

And

the problem I'm having is that I am wanting so badly to get out of debt,

but I am the primary breadwinner because he

He's in the roofing business and well we've had some issues with getting roofs approved and

it's just been really slow so there's a lot of inconsistency like with his with his paychecks coming in and it's causing a lot of

resentment like on my part and probably toward him to where like we went to counseling and we had to have an agreement to where I could only talk about the budget for an hour on Tuesdays and an hour on Fridays.

So that's kind of where we are.

And I just need to know what to do to move forward.

So one, we can be a team together.

And how am I supposed to

do this income?

Jamie, can I ask, is the resentment from you coming from that he's not fully on board with the plan and you guys together are like, hey, regardless of who's bringing the income, this is what we're doing.

We're paying off debt as fast as possible.

Is that the resentment or is it that his h he can't seem to keep an income because the work is so wacky and you don't really know what's going on there?

Yes.

Yes, that's that's what it is.

Like, because he still has, he's got a child that's in college, and then the other one has already graduated, but

I'm like, that's irrelevant to his income.

Well, it is when he can't afford to pay all of the bills that he came in with.

Then now I'm responsible for

those.

And so I...

You mean he's paying his kids' college tuition and not paying his own bills?

Oh, he,

well, right.

I paid everything last month.

I paid, he's got about $4,000 that go out to his kids and their college and car payments and insurance and child support and all of that, and isn't able to contribute to our house.

So in the month of September, we have known that he's coming from.

Well, actually, we will be married one year on November the 4th, and I wanted to go on our anniversary trip to the

Money and Marriage in Nashville.

And I was like, I know that we're in debt.

I was like, but I feel like this is an investment in our marriage because we need it.

And he disagrees with me.

I was like, well,

I can pay for that.

But he said he'd rather go on a cruise, but I'm not doing that.

I think you need a new marriage counselor

because the marriage counselor said that you can only talk about a budget two hours a week, and a budget isn't even the problem.

Yes, I agree.

So that was you getting smacked into the corner by a marriage counselor as being unreasonable, trying to ask him to be reasonable with his contribution to the household.

That's not a budgeting problem.

That's a values and income problem.

That's a priority problem.

That's a priorities problem.

I'm choosing to put $4,000 in a college student's car payment instead of taking care of my new wife.

That's a problem.

That's not a budget.

That's not you talking about Ramsey or you talking about a budget issue.

That's a problem of respect.

And who's, you know, you guys, he didn't ask you about that.

He just declared,

you get nothing and you have to feed me this month.

That's not a budget problem.

And so I think your marriage counselor is a weenie.

I think you need to get get a good, strong marriage counselor that will sit down and talk to both of you clearly about your priorities and your communication over those priorities.

And you guys did a lousy job of setting this up prior to marriage because this is a barrel of fish hooks you both walked into and you did no planning about it.

That is correct.

Yeah.

And that's and so you're reaping that right now and it's just harsh.

I'm so sorry.

But yeah,

you can have two free tickets to come to Marriage marriage and Money.

Yeah, we'll give it to you.

We'll give them to you.

But I also don't want you to think that that's the answer to your problem.

You need more than a marriage and money weekend at Ramsey will give you.

You need in-depth, crisis marriage counseling.

You have not even been married a year, and this thing is unraveling rapidly and before my eyes as you talk about it.

It's really scaring me for you guys.

I feel that.

He's so checked out in what his new wife's needs are that he's not even dealing with it.

And that it's, again, Jamie, you're not being unreasonable, right?

Do you know what I'm saying?

Like, you're not crazy.

Like, the fact that you're like, this feels off.

This doesn't feel right.

I don't feel supported.

I feel like I can't believe he's paying all of this money that he's barely making all the way over there, like, where he can't even contribute to our own household.

Like, I mean, it'd be different if you guys were making a crazy amount of money and you were debt-free and you guys both chose to still support the kids while they were in college, right?

Like, if that that was an agreed-upon idea as your new marriage, but it's so splintered right now.

Yeah, and then you're kind of getting the short end of the stick.

I agree.

So, what is it?

What kind of a business is he in?

He's in the roofing business.

He doesn't make money in roofing.

Why?

He doesn't want to go and knock doors anymore.

He's 54,

and he has some people that work underneath him.

He basically works off of referrals

because he's been doing it for so long.

But he's not got enough.

Now he is

correct.

I have told him he needs to find something else.

So we just had a conversation yesterday, and I was like, I don't care what you do.

Either if you're not going to be working, then I need you to help more around the house.

I need you to pick up kids.

I need you to drop kids off.

It's not really finally.

That's not really an option.

That's just, I mean, you really didn't mean that.

I think she's crazy.

I want him to go to work.

Something.

Well, that's not working.

Some kind of a nest.

Oh, I want him to go make some money.

Well, I do, and I do too.

Yeah,

I think that's what he needs to do, and take care of his obligations, which includes his kids and his wife.

And you take care of your obligation, which includes him and, you know, your all's life going forward, your kids.

And so, yeah,

you guys really need to get back to another marriage counselor and get in touch with your church and ask them who a good, strong marriage counselor that can guide you guys through this.

And

you're going to have to have a reset, a solid reset on the expectations of this going forward and then live into those.

And two hours of budgeting a week doesn't fix this.

And again, I'll give you two tickets.

I don't even think you'll come, but

yeah, General Pickup.

We'll

give you guys some.

Yeah, I'll just

help you come.

We'll put them at Will Call.

And we'll make arrangements right now on the phone.

You hang on.

I'll make arrangements.

You can email them to you or something.

Yeah.

Samantha's in San Diego.

Hi, Samantha.

How are you?

I'm doing well this morning.

How are you, Dave?

Better than I deserve.

How can we help?

So, forgive me, I'm a little bit nervous and I feel all over the place, but I am

trying to make some future decisions without making bad decisions for a future wedding.

And

we had a lot of big changes this year.

I got married and I bought a house, so I would love some Dave wisdom.

Okay,

a future wedding, but you got married.

I got lost.

Yeah, I was hoping you'd catch that.

So, my husband and I, we've been together for five years.

We lived with some family on property for a little while to save for a house.

We found a house a little bit sooner than expected.

So we decided that the best thing to do would be to get married, get this house, and we would save for an official wedding later on.

I had heard you say that would be a good decision to someone on the show at one point.

So

it felt right for us.

It's better than some of the other stuff you could have done in that situation.

So I'm with you.

Yeah.

Good.

Thank you.

I got Dave's good old Matt.

Check.

Survive that one.

Okay.

We are

25, debt-free.

We bought our house,

and we are having this wedding on a cruise ship in March with family.

And we have about $3,500 that we need to just save and pay off for that.

Cool.

Well, you could do that by March.

Yes, we can.

We also

are.

I just got the Every Dollar app and I'm looking at like margin and it's stressing me out like crazy.

My husband is like a turtle in a hurricane and it's like, we got this.

And

well, at least you married a stable guy.

And I'm like, is this guy real?

Because he sounds like Dave Ramsey.

So

he's never read your book.

Are you the hurricane?

Oh, my gosh, he is going to love that.

That's so funny.

I never heard a turtle in a hurricane.

I've heard a turtle on a fence post, but I never heard a turtle in a hurricane.

That is a great one.

I will use that.

All right.

So he's not worried.

What is your household income?

So we bring in $8,000 a month.

Okay.

And he's not worried because he thinks you can have $3,500 out of $8,000 between now and March.

Yeah.

Okay.

And why are you worried?

I have been a hurricane prior to meeting him and this whole talking about money and having an app where we see every time we go to the store and Starbucks has been new and it's revealing budgeting it is and it's so scary yeah and oh no it's just uncomfortable and awkward it's not really scary it's very certain

yeah

yeah it's revealing is what it ouches it touches places i didn't want people to see yeah oh but ouch.

I got you.

I'm with you.

That makes sense.

We became, we became, I became, I never, I had debt prior to the relationship.

He never did.

So I worked really, really hard and he helped me.

And so did you guys.

Oh my gosh.

So we're here now and I want to make sure I don't put myself back in that boat.

I know I won't.

Good.

But

how about we won't?

Yes, I know we won't.

Yeah, you and the turtle work together.

With a big picture, I'm like the worry wort on the turtle.

Like, how do we save?

How do we invest?

How do we have a family?

How do we do all that?

Well, number one, just like you did before, how do you eat an elephant a bite at a time?

Okay, so you lay out a game plan and you look at every dollar together and you say, if we only spend X and Y on those two things, we will have the money to go on the cruise and do the wedding.

If we blow the budget, we will not have the money to go on the cruise and do the wedding.

So let's lay out the plan and stick to the plan so that our best life ends us on a cruise in March doing a wedding.

And then all of a sudden, everything calms way down, but what ends up coming is a lot of no's because you have to look at yourself and go, no, I can't do that because I'm going on a cruise in March to do a wedding.

Oh, no, we can't go over there because we're going on a cruise in March and doing a wedding.

Oh, we're not able to join you tonight.

I'm sorry, because we're going on a cruise in March to do a wedding.

And all of a sudden, all those no's start popping up, and that's what you're not used to.

And that's okay.

That's a new thing, it's a new thing for you.

It's okay, Samantha.

When you guys did the every dollar budget for the household, how much do you guys spend on essentials?

Do you know off the top of your head?

How much it would cost to keep everything running, like food, electricity, you know, mortgage, all of it?

$5,000?

Yeah, and that's with like, because we have animals and

$3,000 a month margin.

Yeah, you could do that in like two months, Samantha.

So i fear that maybe the wedding wasn't the like

fear it's after that and the next big goal um he's confident that there's gonna be an add-on to our house and

save up and pay for it

just like you're doing the wedding yeah and he wants to do some real estate at some point and i just i don't have any of that wisdom so it's okay just knowing let's let's just do one thing at a time let's let's build a little bit of confidence by doing the actual saving and the wedding.

And we've combined our finances and we're working together.

And we have a plan that we are going to stick to to hit our goals.

These are new words.

Used to be me, me, and I.

Yeah.

And now it's we and us.

And, you know, and then first we'll get the

first we'll get the cruise wedding out of the way, and then we'll start talking about, okay, how much is the add-on and what's that going to cost?

And then let's build some wealth because someday we'd like to do some.

Yeah, it's just, it just begun, it's just, you just chip away at it one little thing at a time, one little thing at a time.

And

you keep laying out the numbers and the numbers will guide you right through it.

It's too, Samantha.

Remember, like, none of this is urgent.

I mean, the wedding to a degree in six months, right?

So we want to save for that.

But the house renovations, the investment, all of that, like you're okay.

You guys are good, right?

So nothing has to happen tomorrow.

So give yourself some of that like kind of grace and patience in it.

Because I'm an urgent person too, Samantha.

I'm wired more like you.

So I totally get it.

Glad I got you today.

Yes, no, I get it.

I really do.

And the good thing about our turtles, because Winston, I feel like Winston's a turtle too, is that they love Excel and spreadsheets and stuff.

And they'll map out every year of like, hey, here's how much we could save per month to get this goal of this rental house or whatever the thing is.

And you really lean in on their strengths.

And then you're the funnel.

Yeah.

Yeah, you totally have to do t-shirts for the cruise, the hurricane and the turtle t-shirts.

Maybe, maybe, you know, and with a little bride bouquet and the whole bit on the hurricane.

I hope y'all don't get a hurricane on the turtle.

No, I totally, I said t-shirts.

No, I know.

And I'm just saying it out loud, though.

I don't want a hurricane on the curtain.

And now I present you hurricane and tortoise.

Oh, my gosh.

Yeah, this is so great.

That's so fun.

It's good, Samantha.

You're fun, Samantha.

You're fun.

Thank you.

And you're going to do great.

You're going to do better than your feelings are telling you because you've never done this successfully long enough to build confidence yet.

And Rachel is on the other side of that in that she's got a decade plus of successfully working with Winston.

And she's right.

Winston is more of the tortoise than the hare.

And he's very steady, very predictable, doesn't do drama.

And so they've had a decade of working together.

And that has, now you've got great confidence in that.

Yeah.

Maybe the first day you didn't.

Yeah, and sure.

And the beauty, too, of all of this that you guys will learn in marriage, but it reflects in your money, is you do.

You get to be yourself.

You still get to be fun, Samantha.

You get to lean and have the blessing of having a spouse who is different than you and has strengths that you don't have.

And then you're going to be a gift to him because you're going to have strengths that he doesn't have.

So it really is this yin and yang.

And I think that's the beautiful part of it is that when we say working together as one, I think some people freak out because they think, oh my gosh, I'm going to lose who I am and all.

this stuff.

And no, you be who you are.

And the beautiful thing is your values are aligned.

You guys guys know where you want to go in general together.

And how you get there may look a little bit different, right?

But, but those are the conversations you get to have as a couple.

And so leaning on each other and that, I think, is beautiful.

Turns out turtles have fun too.

They do have fun.

We help them have fun, though.

We create a little chaos

to create the fun.

I've never forget questions like Rachel's job is she's the fun girl.

That's Rachel's job.

And our premarital counselor, I'll never forget, looked at him and was like, wow, she's pretty urgent.

And I was like,

I am.

I am.

I'm an urgent person.

So I get it, Samantha.

I totally get it.

No, we're going to do great.

You're going to do it.

Cane and the turtle.

This is great.

Great radio.

Dale in Missouri.

Hey, Dale, what's up in your world?

Oh, not much.

How are you guys doing?

Better than I deserve.

How can we help?

So, you know, the holidays are right around the corner, and my wife and her family have quite a few traditions for Christmastime, and they are starting to get rather expensive.

For example,

we each get a book from Santa, like a children's Christmas book from Santa, and there's about 12 of us.

And we have stockings, which averages about $1,000 to $1,200 total.

And then we have gifts for everyone.

There's about, again, 12 of us for that.

So my question is.

I'm sorry.

12 children's books for 12 adults?

Adults, yes.

And her family.

Is this her brothers and sisters?

So it's her sister, her father,

and

her sister's children.

And now one of her children, her sister's children, has their own child.

So now there's a baby.

Okay, so this isn't your all's children or your grandchildren?

No.

Okay.

This is, and so my wife was really big on

her grandparents.

She has fond memories of Christmas at her grandparents' house.

They did the same traditions.

She just wants to continue those traditions.

How long have you all been married?

Well, it'll be 15 years.

So you've done this for 15 years?

Yes.

Okay.

And are you buying books?

Is everyone buying 12 books or is it one book per person?

So it's one book per person,

but it's usually my wife and I

and her sister that are kind of responsible for all the books.

What I mean is it's twelve children's books.

It's not a lot of money.

What's a big deal?

Well, they're about $30 a piece.

So, I mean, yes, it's not a lot like it's $360.

But the books are

not a very big traditionalist.

So they're kind of I don't want to say a waste, but I am.

They're kind of a waste because we just we look at them for like twenty seconds and then they just go away.

And

then

we go on to the next thing.

Okay, so the purpose of the books, I'm just curious because I don't understand why all these adults are getting children's books for 20 seconds.

What is the purpose of the book?

It's just a tradition they've had.

I know, but I mean, when they were children, maybe, but I don't know.

Once you're 40, you don't really need a children's book.

What's the.

Right.

That's

my question is.

Well, I want to.

I mean, if she was on the phone, why would she tell me that they're still doing this?

It's just what they've always done.

I know, but

I know, but it's just that's the tradition.

Is everyone gets a new book for Christmas?

It's a Christmas book tradition.

Okay.

All right.

And it has like a little note from Santa in it.

Well, those are hard to get, but okay.

And so that's one thing.

And then we have stockings

where people can spend $200 to $300.

And it's most, again, my wife and I and sister, for all the stockings.

So they put like $200 or $300 in each stock.

So what is your all's net worth?

Not enough for $200.

No, what's your net worth?

No, really.

What's your net worth?

You mean like total?

Yeah, like how much do you have in your retirement accounts, your house paid for, all that kind of stuff?

So the house that I paid for has got about $100,000 left.

And what's it worth?

It's worth $200 and

what's in your retirement accounts?

So retirement,

we work with

a pension.

So you don't have any retirement savings?

Well, I do.

I have $100,000 saved up.

And what's your household income?

Roughly about $210,000 a year.

Okay, and this whole thing is like $3,000 we're talking about, right?

Well,

three grand for like the stockings.

Well, the books are $300,000.

So, I mean, it's like $3,000 for the whole thing, give or take.

Yeah.

And then there's gifts also that we also do,

which could also be another $3,000 or $4,000.

Do y'all have children?

No.

Okay.

So this is the whole Christmas thing.

Right.

The problem is that we don't really

put aside for this,

even though we know it's coming.

You make $200,000.

It's $3,000.

It's 1.5% of your income.

Yes, I know that.

But

my wife and I, I'm not going to throw it all on her.

My wife and I like to

we're not good budgeters, I would say.

And so my question is.

Well, I guess the thing is this.

I do think just from a marriage communication standpoint that

this thing has continued to go on

and some of it's frankly doesn't even make sense.

But at least you need to understand from her why this is $3,000 worth of important.

Because it's no longer $3,000 worth of important to you.

Probably never has been, actually,

in the whole 15 years.

But now you've just been going along with it.

That is crazy, though, the amount of money y'all are spending on stockings.

You can get some great stocking stuffers and some reasonable small things, and it doesn't have to add up to $1,000.

Honey, you know, I understand this is important to you, and I'm willing to do it simply because it's important to you.

But you also need to to hear it's important to me that we use a little touch of common sense on this.

Well, and I think the biggest problem, Dale, is you guys aren't do you have no planning with your income.

You guys aren't good budgeters.

You already said.

So it feels like you're flapping in the wind and it's like this year and it's kind of freaking you out because y'all don't have control in general.

And I really think if you guys lived on a written plan, if you guys, we'll get you the Every Dollar app, but you both, if you both lived on a budget and you knew exactly where your income was going and you both stuck to it, it's not that big a deal and it would i don't think it would feel as out of control i think it feels out of control as a picture of your entire financial picture so genuinely i would you're choosing that to pick on the one thing that you can pick on while the whole thing's out of control rachel's right so let's get the whole thing in control and then make sure we can use this as a jumping off point for the discussion for that but i think it's also individually on the budget it's okay to talk it through i mean we've done that inside of our family and even with our extended family because I have three kids who are married and have eight grandkids.

And so there's 16 of us and eight adults.

And every adult buying every adult something got out of hand.

And it just was dumb.

Yeah,

we all have the money.

Just draw names.

But everybody, we just said we're going to draw money.

It's just more fun for us to not have to go through all that.

It's exhausting.

Less, you know, less.

trying to figure out what Bill wants, you know, or what Winston wants.

It's just a lot.

And how do do you buy something for me?

Because anything I want, I just go get it.

So how do you buy something for me?

I know it's always hard.

It's impossible.

It's so hard.

It's impossible.

So, you know, it's just, you know, that whole thing is just, we need to just, so we just dumbed it way down and we're going to concentrate on the kiddos and the adults.

We draw names as adults.

But it's one thing.

I mean, it's not

eight things, right?

So that's okay.

And just calm the thing down.

No, and I, and I'll throw this out there.

They'll like, they don't have kids.

So this is their family Christmas.

It is her family Christmas.

And it's her family Christmas.

So there is a level of.

He's over it.

It's her family Christmas.

He's done with

children's books for adults.

That's my question: is how you get, no, how you don't run out of books.

I guess they don't have to be Christmas-themed.

Rachel, we could help them.

There can't be like.

We could probably make them a discount if they want to buy a batch of Rachel Cruz children's books.

Yeah, but I don't know if they're Christmas-themed children's books.

I'm just curious how they get so much.

I could probably add a note from Santa to it.

I don't know.

I know Santa.

If they bought a whole box, a whole case of your books.

Pull some strings.

We could probably do that.

I bet we could get the old guy to help us out.

Maybe we'll save Dale's Christmas this year with that, too.

Oh, man.

That is hard, though.

Hey, it's the holidays.

It's a good time to talk about it.

Now's the time to talk about it, not December 2nd.

Yeah, we're in October.

It's great.

This is the time.

By the way, all of you need to,

speaking of Santa, he says to make a list and check it twice.

So you need a Christmas budget.

You need to make a list of who you're going to buy for and put a dollar amount beside each name and total that number and set that dollar amount aside.

We used to do that in cash in an envelope, and on the outside of the envelope was the list of people and what we were going to spend on each person.

And then that cash runs out of that envelope.

Christmas be over, baby.

That's it.

This is what we're spending on Christmas.

That's it.

Ding, ding, we're done.

Because it's a never-ending

merry-go-round, otherwise,

and you just keep hitting the submit button on your cart

have to stop that

how many times do you end up with too much month at the end of the money Even if you can cover the bills, there's nothing left over.

You work your butt off and you still feel broke.

That's normal for most people, people.

But you do not have to live that way.

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Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio.

I'm Dave Ramsey, your host, Rachel Cruz, Ramsey personality, number one best-selling author.

Host of the Rachel Cruz show is my co-host today.

She's also my daughter.

Open phones at 888-825-5225.

Jenna is with us in Indianapolis.

Hi, Jenna.

How are you?

Hi, I'm good.

How are you?

Better than I deserve.

What's up?

All right.

So I just recently found out that I am inheriting about $50,000.

Wow.

Yes, definitely a blessing.

Who passed away?

My grandmother.

Oh, I'm sorry.

Thank you.

I am just, I'm 25 and I do have a lot of student loans as well as a car loan.

I have about $95,000 in total debt.

$65,000 of that is my student loans.

I am just a little bit confused on where to put it all because

I don't want to throw everything at my federal loans.

So I'm just kind of confused about where to go with all of this.

I'm curious, why would you not throw it at your federal loans?

Because

I

was approved for the public service loan forgiveness.

That's a scam.

And so I don't.

1% of the people that apply for that end up getting it.

Okay.

Yeah, I wouldn't set my life up on that.

Well, and you get stuck in a situation that you may want out of, and you feel like you have to stay in it.

For 10 years, everything has to go exactly perfect, including the federal government doing their job.

And those things never go to heaven.

That doesn't work.

So,

poof.

All right.

Aside from that, so what do you make a year?

About $60,000 give or take.

What do you do?

I'm a nurse.

Oh, good for you.

That's a wonderful career for building wealth and getting out of debt, by the way.

You have tremendous control of your destiny in that career.

So you can add hours.

You can add an ER shift on the weekend, make a pile of money.

You've got all kinds of options at your disposal.

So good for you.

Good choice.

Jenna,

what was left?

You said the 65 of student loans.

What was the other 30?

A car.

A car card and credit card.

Yeah.

A car and credit card card.

I have a car loan for $28,000, and then just a credit card that has $1,400 on it.

Okay, perfect.

All right.

So,

and what are you making as a nurse?

About $60,000 a year, depending on if I pick up or not.

It's about $4,000 a month.

You must have just started.

Yeah, I've been a a nurse for two years.

Okay.

All right.

Because you probably could be making 80 if you just blink.

Okay.

Well, and I'm in Indiana, so it's a little bit.

I mean,

if you're in Indianapolis, you're in a major metro market that you're being underpaid.

But yeah.

All right.

What we teach and what we have lived in our family for the last several decades is the fastest way to build wealth and stability is to become debt-free because when you don't have any payments, you have control of your wonderful income opportunities to build wealth with.

And that's how the math ends up working.

And so we've taught people to get out of debt so that they can be generous and so that they can build wealth.

The first step, however, of getting out of debt is not borrowing anymore.

And so if you got a $95,000 inheritance and paid everything off, but continued to go into debt, you'd be right back.

Yeah.

We can't do that, okay?

Just like you can't have a patient that's doing something that's causing a health problem.

You guys fix it in the hospital, but then they go back to doing the exact same thing and end up in exactly the same health problem again, okay?

Same thing, right?

So you have to change your habits that got you here.

Like, I don't borrow money for cars anymore.

I'm cutting up this credit card, and I'm going to get the Every Dollar app, and I'm going to live on a decent written plan where my wonderful income will cause me to finish off the rest of my student loan loan debt and

get me completely clear because if I don't have any payments, I can build serious wealth.

And that would be my goal for you if I was doing that.

Now, if I'm in your shoes, that means I'm going to pay off the credit card and the car, and I'm going to put the rest of it towards the federal student loans, and

I'm not even going to have any fun with it.

And I got to ask you then, if you did that and you are committed to never borrowing again and living on a plan, would that make your grandmother smile?

Yes, definitely.

Which is one test I always use about inheritance.

The person that left it, I need to honor them by handling it in such a way that they're in heaven smiling.

Okay?

And so, in other words, if you did something irresponsible and frivolous with it,

She would not be smiling.

Correct.

Yeah.

And that's how I test it out against my, am I doing the right thing with my grandmother's money that she left to her prized nurse grandchild that she's so proud of.

And what's wild, Jenna?

Have you done a written budget?

Do you know how much money it takes to run just your household, whether it's like rent, lights, food?

How much do you live on, do you think?

I do a written budget.

However, I've had some recent changes.

I've been living at home for a while, but now I'm moving back.

So monthly, I think it probably would cost me, or yeah, monthly, it it probably cost me about $2,000.

Okay.

And how much is your car payment a month?

It's $560,000.

Okay, perfect.

So that's what's crazy is you just got a raise of $560 a month.

And with that, so I mean, you could be banking $2,500 a month just in what you're doing right now.

That's not even overtime and all of it to get the rest of that $45,000 paid off.

So it is.

You jumped in and picked up some ER weekends, which you can make double, triple time on if you watch what you're doing, you can, in addition to whatever you're doing in your other 40 hours, you could get this all paid off in a year.

Yeah.

That would be pretty cool.

The only thing that I was considering at first is that my private loan has a higher interest rate than any of my federal, and I pay almost $300 a month on that.

Okay.

How much is the private loan?

It's $23,000.

Oh, perfect.

And

isn't that the next smallest one anyway?

The highest one is 31, the car is 28, and then the private loan is third.

Yeah, but you have enough to pay the private loan and your car.

Yes.

So do you think I shouldn't?

And the credit card.

I think you can pay all three of those.

Okay.

I didn't have them broken apart.

I just heard student loan.

Okay.

Yeah.

That's incredible.

Yeah.

So then what would be left would be the federal?

So I mean, you don't quite have enough to do all of it, but you might have two grand left on the private, and you'll knock it out in a month or so.

And

pay off your, no, your car is the one to be left.

I'm sorry.

You're going to knock out smallest to largest is how we list them.

So the credit card, the $23,000, then the $28,000, right?

Yes.

Okay.

Okay.

And then, Jenna, how much is your private student loan payment every month?

$300.

It's, yeah.

The federal, I

have it set to the lowest, which I need to change because I'm not even curious.

But that's what's crazy, Jenna, is this what this money can do?

It's going to be $800, right?

$860, yeah.

Yeah.

Which is great.

And that gets thrown at the federal debt and then work an extra and you get the snowball going really quick.

Yeah, that's what I'm saying.

I think you can be out in a year.

You're really going to change your cash flow position.

You're going to please your grandmother, honor the inheritance that she left you.

And because all of us that have children and grandchildren love them and want to see them prosper and live a sustainable, mature,

smart-wise life and all of those things is what we're talking about.

You're doing good.

I'm real proud of you.

Well done.

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Larissa is in Ohio.

Hi, Larissa.

How are you?

Good.

Thank you so much for taking my call, both of you.

I really appreciate your time.

Sure.

What's up?

Everything.

Okay.

So I'm wondering if my situation is one of the kind of rare cases where you would suggest that I should sell my house to pay down debt.

And if not, then what should I do?

Okay.

How much debt do you have, not counting your house?

Around $500,000 or $600,000.

Whoa.

On what?

My husband's school loans are $80,000.

My school loans are $45,000.

We have a debt consolidation loan for $45,000.

And

two cars that are ridiculously like the worst thing you've ever heard.

I'll tell you if you want to hear it, but I don't think you want to hear it.

You might die.

Just give me the total.

Okay.

The total owed $67,000 on mine, $62,000 on my husband's.

Yeah, you're right.

Okay.

And the big thing, I think the main reason I'm calling today is we owe the IRS $56,000,

and they want to put a lien on our house because we owe over $50,000.

Yeah.

What's your household income?

I'm about to go back full-time, making $111,000.

And my husband usually would be making around $120,000, but he was just laid off at the beginning of the month.

And that's another part of the story: we have no emergency funds.

So we're rocking it over here.

Oh, gosh.

I'm so sorry.

So normally you would be at like, I mean, if you get everything going again, you'd be at like $2.30.

Yeah.

And the house is worth what?

It's probably worth between $770 and $800.

Okay.

And what do you owe on it?

$628.

Okay.

Well, my worry there is like after agent fees and closing costs.

Yeah, you're not going to get enough to clean up the mess.

So the message is.

Yeah, I think it would help us with the IRS and maybe to pay out the cars.

You know what I mean?

The negative expenses.

How do you end up owning the IRS?

$56,000.

Oh, man.

So me and my husband, we've been married 22 years.

We had three kids, very young, super broke back then.

So we were on like Medicaid, food stamps, everything like that.

We just never had money, right?

Then kind of like out of nowhere, when he graduated college and then I kind of landed in my career, we started making money out of nowhere and we didn't realize that we weren't getting enough taken out of our checks, yada, yada.

So, one year after another year after another year, it was like we owed 12,000.

We're like, what?

I guess it's just tax bracket.

I don't understand this.

Next year, we're like, we owe 20,000.

We're like, why is this happening?

I don't get it.

So, genius me.

This year, I finally met with an accountant who told me that I wasn't getting enough taken out of my checks.

Also, I have like a side business where I design and develop websites and stuff.

So, I haven't been doing good at prepaying those taxes either.

So, it's like it's just a big hot mess of garbage that, you know, what are you making?

um

I think this year and it was like 30.

Okay.

All right.

So

well what you have is a series of crises.

Yes.

And

you really have to probably work on three of them at least at once.

And sadly, the house won't fix them.

Right.

So,

you know, what's your husband do for a living?

What's his career?

He's a software quality engineer.

Great.

Okay.

So he's very employable.

Yeah.

Okay.

Why did he leave?

He was in like an 18-month contract and they didn't renew it.

Okay.

Just doing contract work.

Okay.

Which is another time you didn't pay the IRS.

Well, I mean, it was a W-2.

Oh, a contract W-2.

Okay.

All right.

Anyway, so the good news is he probably can lean in, put a smile on his face, a pep in his step, brush his teeth, and get a job pretty quick.

Yeah.

Okay.

Because this is a pretty employable situation.

All right.

So number one crisis, re-employment.

Okay.

Number two crisis, the IRS.

You need to get on ramseysolutions.com and talk to one of our tax-endorsed local providers, one of the people we endorse in your area, and they will be able to get on the phone and negotiate with the IRS a payment, an installment payment plan with no lien.

And even if they put a lien, they won't do anything with it because they don't want to pay $628,000 for a house.

Yeah.

They're not going to do anything with your lien.

So what you don't want them doing is leaning your checking accounts and cleaning out your bank accounts because that would be disastrous.

So you do need to get them.

You need to get them on a payment plan.

And of course, part of that is you really do have to source this all the way to the the bottom and make sure we sit with your tax person.

And if you need a new tax person, you can get them at Ramsey as well.

Sounds like you may.

And make sure you've got the right amount coming out of your taxes and that you are doing your quarterly estimates on your business.

And you file those and you file that money on time.

Once a quarter, you're supposed to figure out what your profit is and pay tax on it.

Yeah.

That's the law.

And you're getting hammered with penalties and interest in addition to them coming after you you for the balance.

Okay.

So that's, they, they get after you on that stuff, on that 30,000.

They're wearing you out.

So, you know, you get, get on top of that with your systems and your processes

because you're not dumb people.

You're just highly chaotic and disorganized.

Yeah.

I keep saying we spend money like teenagers, you know, like the way we're doing.

Yeah, yeah, you've been doing that too.

That's another subject I'm coming to in a minute.

But you're just out of control.

I mean, there's like no off-button here.

This frenetic, there's no plan.

And so what I'm telling you to do is get very systematized and nerdy about this.

Like I hired you to straighten out these people's finance, only these people is you.

I actually did a literal PowerPoint presentation and Excel sheet before I called you guys to like understand what my picture was here.

Good.

That's a really good start.

That's a good step, actually.

You got to get, you got to, you know, that's, you know, I'm looking at the map and the little red arrow says you are here.

I want to get over over there, and now how do I get over there, right?

So, that's what we're talking about.

So, job, get the IRS under control first with a payment plan and with proper withholding and proper filings of your quarterly estimates.

Then we'll begin to pay them off as quickly as we can.

And then we come to the cars.

Yeah.

They're both.

I'm ready to get rid of them.

Oh, you have to be like,

we have negative equity on the bottom.

I know.

This is absolute freaking insanity.

If you look up crazy in the dictionary, you're going to see a picture of these cars.

I was expecting you to say that.

I thought you were going to say me, but okay.

No, no.

I mean, this is just,

because it's killing my friend Larissa.

Yeah.

My friend Larissa, these cars own her.

Yeah.

Well, it adds up to what you guys make a year, you know?

I mean, y'all don't make nearly enough to have those cars, even if you paid cash for them.

Yeah, I think like our situation is that like we've never been late on a car payment on our mortgage, which is Are you going to try to justify this to me?

Please don't.

No, no, no.

I'm telling you that's why we thought we were okay.

Yeah, that you could afford the payment.

The IRS thing made me look at it.

You get what I'm saying?

Yeah, that whole dumb thing.

You realize when you look at these cars that they're a glaring,

not just a Dave Ramsey thing or a Rachel Cruz thing.

They're just a glaring math thing.

Yeah.

Yeah.

I mean, they're just pointing to you guys, like you said, we spend money like teenagers.

You know, and so

you need to get you a couple of, you know, reasonable vehicles, very cheap, like five, $6,000 a piece.

And you guys use your $230,000 income to clean up this freaking mess so you get your life back because you're not having fun.

Yeah.

This is highly anxiety-inducing.

Yeah.

And when he gets a job back, you know, you guys are making great money.

Like insane.

So the quarter million dollars a year will clean this mess up.

Yes, yeah.

You guys can do that.

And then if you can imagine making that amount of money and actually keeping it and it not going out in payments, you know, and you guys.

Trust me, that's all I imagine these days.

Any payments but a house payment.

Yes.

And you made a quarter of a million dollars a year.

Oh my goodness.

You would have money.

Yep, I can't imagine it.

And then you can move from a $6,000 car to a $20,000 car.

But that's the thing, though,

because even though that's an incredible income, you still have to live within that income because even with that great income, you guys were living beyond it, right?

You two just need to sit down and look at each other.

Neither one of us are in Congress.

Right.

We can't spend like this anymore.

Spend like a drunken congressman.

I mean, it's out of control.

Drunken congressman.

Well, they say drunken sailors, but I like sailors, right?

You know, sailors, bless their hearts, they're probably way fiscally responsible compared.

So even with alcohol involved.

Hey, George Camill here.

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Not in all states.

Today's question comes from Camilla in Indiana.

She said, I'm trying to wrap my head around the commission method of giving money to kids.

I have two who are five years apart.

My oldest is 16 and the younger one is 11.

Should they have individual lists of tasks or should there be one big list that they both work off of on this on a first-come, first-served basis?

Should give, save, spend be a mandatory part of this participation, regardless of what age?

And how do you recommend?

I missed

your age out of it.

So, for the 16-year-old, I would just expect them to be helping around the house in general.

So, there's not necessarily like a chore list, they're just becoming an adult, and so they're going to be doing adult-like things.

And so, whether that's cleaning the kitchen, picking up,

helping with cooking and laundry, like whatever that is for you, they just are part of helping run the household.

And then, I, I mean, I plan to do with what you guys did is at 16 that they should have their own checking account.

And the amount of money you would normally spend on them, whether that's clothes, friends, gas, whatever it would normally be, you just give them that set amount of money and then they have to manage it

with your oversight.

Yes, but they have to be the ones to say, I'm going to spend X shopping, but then that means I don't have that money to spend for gas in my car.

And so if the money runs out, they either get a job or they wait till the next month because they have no more money to spend.

And then the 11-year-old, yes, I would do a chore-based payment kind kind of plan.

So they do have chores listed out that they do, and you pay them on there.

And then in that, yes, the give, save, spend method,

I would definitely have them do because it's a great

getting all three of those

part of her question.

So let me reframe exactly what Rachel said and give you the exact same answer.

But let's look at it as an evolution.

So you teach children how to handle money age appropriately.

We don't send the three-year-old to the salt mines.

We might send the 16-year-old.

No, I'm kidding.

But

you expect more and teach more sophistication and detail and brain challenge to 16-year-olds than you do three-year-olds.

You know, if you say clean up your room to a two-year-old or a three-year-old,

We all know that have had kids that that means I'm going to do about 80% of the work.

He's going to put a few toys in the box, and he gets a lot lot of high fives as being the best room cleaner that God has ever made.

Way to go.

You're amazing.

And here's a dollar for cleaning up your room.

That's one of your chores.

But we all know they're not real good at it.

They're not competent.

That's not the point.

The point is to begin to make an emotional connection between work and money.

Work creates money.

And I know 54-year-olds that don't know that lesson.

So it's good to teach children that work creates money.

Even if it's a tiny little thing like picking up four toys, okay?

Then we move on to something a little bit more complicated.

You got to feed the dog, you have to clean up the toys yourself, and you have to empty the dishwasher.

And you're seven or eight, and you can accomplish these horribly complicated, ridiculously straining tasks.

And the drama that goes with all of that is unbelievable.

And then you get paid a dollar apiece for doing those all week or whatever the agreed amount is.

And if you don't feed the dog and I have to, you do not get paid.

Commission is work, get paid.

Don't do the work.

Don't get paid.

By the way, ultimately, I mean, we'll let that go on for a week or two, but I'm just not going to do anything.

It's not an option.

You're going to learn to work because my goal raising children was not to raise great kids.

It was to raise kids that became great adults.

And so my job is to make sure you brush your teeth so you have some, so you're somewhat appealing to the opposite sex, and you leave my home later.

Okay, That's the idea.

Okay.

So I'm trying to get you out of here.

That's the goal.

And what's funny too, I would say majority of kids, not all, because some kids are not motivated by money.

No.

But

we have found most.

Now, I will say, I am a free spirit as a mom, so I'm probably not as rigid as I should be.

I'm a little bit more like, unload the dish washer and I'll give it.

It's not, my kids literally created their own, they just showed me yesterday, their own chart for letting the dog out in the morning.

Amelia is more organized than you are.

And then what's so great about it, that genuinely yeah she like she should gosh she's gonna take care of our estate she's gonna be great and so but she um but she's our saver and so you actually watch them participate and when they earn money what they do with it i'm gonna show you this picture i'll text it to the team and they can put it up if they want later but it's funny we went to target literally this weekend before i was in chicago and they got to bring their money um to spend because i because i don't do it all the time because i just always want to spend the money they make so i always kind of put it off a few weeks so we went and my oldest it's like she looks through she looks through, and she's like, I just think I'm gonna, I think I'm gonna keep it.

I don't see anything I want.

And then I like the money more.

And then my middle, she bought like literally eight things.

Do you see that, Caroline?

She like couldn't, she couldn't handle everything.

She spent every

cent, basically.

She's exactly like you at that age.

I know, I know.

But it's great because I'm like, yes.

And at that age, parents, like it is, it's an amazing thing when they do something for themselves and something big.

I mean, they unload the dishwasher, they take out the dog and all of it.

If you have done that along and you've taught them to work give save and spend age appropriately by the time they get to 16

you can talk about we're going to turn this over to you I'm going to watch over your shoulder and make sure you do it properly and I'm not going to control you but I'm going to allow you to make mistakes but I'm also not going to let you be out of control with your checking account but you're going to learn to manage your work, your fun, your spending, and you're saving and you're going to do and you're giving, and you're going to do all of it yourself.

And I want you to feel the whole thing more like an adult.

So then the age out comes.

If they've been doing that three years or two, I think we did it with 15, up to about 18, under your control and direction, progressively you should need less and less control because you're teaching them to lay out this how much you got for the month.

How much of it's going to go to gas?

How much of it's going to go to fun?

How much of it's going to go to generosity?

How much of it's going to go to this?

And you need to lay out a budget for this so it doesn't just escape you like everybody else.

So if you've done that for three years, then when they left and went to college, did the exact same thing, only we didn't even look at it.

By then they knew what to do.

This is how much you get a month for college expenses.

And we're going to pay tuition and we're going to pay books and we're going to pay housing.

Or if you had housing, we would put that in the amount, either one, whatever it was.

But this is what you had to work with.

We're going to put that in your account.

If you want more than that while you're at college, get a job.

Because that's how much we're going to give you.

And then it's enough for you to, you're going to have a good time and you can have a good life.

You're not going to be driving a brand new BMW.

You're a freaking college student that's broke.

And so you're going to be going doing this and you got, you know, college is paid for and even your living expenses is paid for up to a reasonable amount.

Past that, if you want $175 pair of shoes, you're going to have to get your butt into a job.

Okay.

And that's, you know, because I ain't paying for that.

And that's, then they all four,

all three, I'm sorry, there's three of them, went through school.

I don't know about that other one, but

that other one took off, but the other one, but the other three, they went through school in four years.

And

the number of times I got a call that said, Dad, I need money

between all three of them going through four years of college was precisely zero.

Now, we did have a time or two.

They came home and said, hey, here's the actual reality of this budget.

It's pretty getting pretty tight.

Can we consider doing a raise on it?

And we did do that a time or two.

But I've got an emergency.

I overspent.

I goofed none.

So they aged out.

And then when they graduated, got married and started their own lives, they already knew how to do life.

So we trained them progressively as they evolved from three years old to 23 years old.

And,

you know, got in more detail with it and gave more and more responsibility.

So if you've got a 16-year-old Camilla that's brand new to this whole thing and you dump this on them without you teaching them and spending some time talking through these concepts, you're going to have a disaster on your hands.

Don't do that.

Don't put $1,000 in a 16-year-old's account with no boundaries.

That thing's just, you're just going to piss away $1,000 instantaneously and get no lesson out of it.

Because the goal here is not the money.

The goal is to learn how to do generosity, saving, proper spending, and work.

If you teach those goals, they learn those principles, principles, they'll find their own money as adults.

Our scripture of the day, Isaiah 29, 24, those who are confused will gain understanding and those who grumble will accept instruction.

Tommy Lasorda said there are three kinds of people in this world, people who make it happen, people who watch what happened, and people who wonder what happened.

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Rylan is with us in Utah.

Hi, Rylan.

How are you?

I'm doing well.

How are you?

Just the same.

How can I help?

I'm 22 years old, and I just graduated college

shortly after I moved back home.

But during my time in college, I was able to save around $60,000.

Wow.

Dang, how did you do that?

I started a clothing business and ran that all through, well, I started it in high school and then ran it all through college while I was studying.

Dang, that's incredible.

Way to go.

Like new clothing or what were you doing?

It was hoodies.

So we, yeah, we had a hoodie brand and then marketed it through, you know, all the short form platforms.

You should have.

Have you quit it?

I haven't quit it yet.

Okay.

But the income income is pretty variable and i just started a new job so what do you make of your new job you ended on this

uh 65 000 good for you man 60 000 in the bank graduated from college 65 000 income and a hoodie side hustle way to go man you're killing it thank you thank you so my question was i'm i'm at home um

and i have the opportunity for the next year to live at home

yeah and you don't need to do that you're a man

and then I also

have kind of been getting the itch to move away

and start my own life.

Scratch it.

And so I just kind of wanted to get your advice on if I should continue to keep investing money or move.

Okay.

I figured you'd

scratch the itch, man.

Time be free.

Listen, here's the thing.

You have done so many things that are mature beyond your age.

You've started and run a successful business.

You've saved $60,000.

You graduated graduated from school.

You got a legitimate, solid first-entry job coming out.

What's your degree in, by the way?

I got it in business analytics, so I'm a consulting analyst.

I'm not shocked.

Okay, that's just wonderful.

So everything in your story is so solid and so mature.

And yet, what you're going to find is when you buy your own milk

and your clothes don't jump up onto the hangar magically, but without you putting them there,

your life's going to even even get further along

in your maturation and your development.

And so the Rylan that I'm talking to now will be a substantially different man one year after he's completely on his own, paying his own bills top to bottom.

And he swings by and tells his mom he loves her occasionally, but he does not live there and she does not buy his food or his clothes or iron his shirts.

Yes, amen.

And when you go on dates, you don't have to be like, well, I guess we got to end this because mom and dad are home.

And I can't bring you home, right?

I'm not kidding.

There's something very like, yep, all of it.

So

it's good.

It's good for you.

Yeah, that's that's you're you're you man, you got so many things going on.

I've been done though, Riley.

I bet your parents are so proud.

I bet they are.

I'm proud of you, and I'm sure they are.

And it's not, my point is, it's not just a math thing.

There's things that are going to happen in the spirit realm and in the psychological realm for you that are, um, that are, that, that far outstrip what little amount of money you could save on rent.

So, go, go, be, go be the best version of you for the next three years, man.

I love it.

I'm proud of you.

Jake's in Texas.

Hey, Jake, what's up?

Hey, what's going on?

Better than I deserve.

How can we help?

Thanks for having me on.

Called in to see if it was appropriate or what should I do first before purchasing a higher-end timepiece?

Cool.

What's the watch?

Looking at various brands, the typical Rolex, Panerai, Omega.

I haven't really narrowed it down, but kind of feel guilty.

You thinking about a budget of what, 1020, Ren?

10-ish

is my first one.

And I just kind of feel guilty spending that much money on myself.

So one of the things that I've got to do is I don't feel guilty spending it on you if you've got it.

Do you have any debt?

We've got a house, a car, one of the cars that's free and clear, and then no other debt besides that.

Well, I got to fess up.

We owe $700 on a mattress that I could pay off

right now.

How much do you do?

No, you don't need to buy a $10,000 watch.

You have a car debt.

Okay.

You're broke.

What do you make?

This year, I will eclipse $400

commission.

What do you do?

I'm in the mortgage industry.

How long have you been in the mortgage industry?

19 years.

Wow.

How old are you, Jake?

I'm 41.

Okay.

So, why, pray tell if you made 400 grand, do you have a car debt?

I don't know.

I could pay it off, too.

Good.

You have the money in the bank to pay it off?

Yeah.

How much money have you got in the bank?

We are approaching 1.2 in total cash assets.

Okay.

You're not talking about retirement.

$6,000 or $700,000 of that's retirement.

The rest is post-tax, 529,

stocks, bonds, cash, just various

on the returns.

Well, it's ludicrous to borrow money on a mattress.

I can't imagine what you were smoking that caused that.

And it's almost as dumb to borrow money on a car when you have the money sitting in the bank to write a check and pay for it.

So, I mean, you did call the Ramsey show.

You know that, right?

I'm aware.

I'm aware.

I knew you were going to beat me up a little bit.

All right.

So, yeah, I would go buy the watch as soon as I pay, to celebrate paying off the car and the thing and to celebrate my newfound debt freedom that I'm never going to do this again because I make too stinking much money and I have too stinking much money to be buying things with debt.

But no,

if you make 400 grand and you're debt-free except your home and you have a half a a million dollars in non-or $700,000 in non-retirement cash assets laying around, you can do a $10,000 watch.

Absolutely.

How much is left on the mortgage, Jake?

We owe $290,000, and the house is worth $750,000.

Why don't you go ahead and pay it off?

Get the house paid off.

Go ahead and pay it off, too.

That scares me.

So hear me out.

Why is that scared?

Because he's a mortgage.

Yeah.

Unbelievable year.

Up and down, you know.

Yeah, but I mean,

it would scare me less.

I mean, if I had no income, I would rather have no mortgage.

Just the feeling of having the cash.

Yeah, it's a feeling.

And you're in the mortgage business.

I'm trying to take you into paying a mortgage off.

I get that.

But,

you know, but yeah.

If I woke up in your shoes, sir, I would be 100% debt-free and wearing a $10,000 watch by the end of the month.

Cash.

Car, house, mattress, God, and everything.

That's exactly where I would be.

And then I'd be on a written game plan.

And then you make a crap ton of money.

Because here's the other thing.

If you're just a tiny bit afraid about having less cash assets, it'll motivate your butt to do more deals.

Yeah.

Well, and with that income, which I know you don't get that every year, Jake, but like you can replenish the cash very fast.

Yeah, you built it pretty quick.

So

you've done a really, really good job.

I will tell you, in general, you don't need to feel guilty when you can spend the money and it's a small percentage of your world.

And in general, that's the answer to your question, yes.

But I gave you a lot of detail to go around that of all the things I would do.

But you did ask, and you did call this show.

So that's exactly what I do.

You've done very, very well.

Don't, I ran into this because you're a great salesman, and salesmen sometimes run into what I did.

I tried to out-earn my stupidity for a while.

Just lay into place a system, work the stinking system, man, and then go bank a pile of money and apply it to the system.

You're doing so good.

That puts this Hour of the Ramsey Show in the books.

We'll be back with you before you know it.

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.