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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 in the Fairwinds Credit Union Studio, this is the Ramsey Show.

I'm George Campbell, joined by my good friend and best-selling author, Dr.

John Deloney.

We're taking your calls at 888-825-5225.

Don't be shy, give us a call, get through our phone screen or Christian, and you will be on the airwaves helping other people who might be in a similar situation that you're in.

So we'd love to hear from you.

Eden is going to kick us off in Kansas City.

What's going on, Eden?

Howdy, y'all.

How are you doing?

Great.

How are you?

I'm doing all right.

All right.

So

my question is, how do I stop my fiancé's mother from stealing her student loans?

Stealing whose student loans?

My fiancé's.

Okay, so your future mother-in-law took the money that your wife, your fiancé took out for student loans and is using it for nefarious purposes?

It it seems so.

So

last week we were trying to figure out, you know, hey, what are her student loans going to look like?

She transferred from a university to a community college to finish her nursing, nursing program.

And her and we asked her mom because apparently her my fiancé's student loans went to her mom's checking account because her mom wanted to put it from her checking account into my fiancé savings but here's the kicker my fiancé's savings she's only a signer her mom is the custodial

the custodian and can only allow

with her mom's permission to see her own savings.

What in the Britney Spears conservatorship is going on here, dude?

Why does she have control of a grown woman's finances?

Excellent question.

Here's to answer your question.

You, brother, can do nothing.

I know.

Okay, nothing.

Your fiancé does not have a checking account.

She uses her mom's.

Right.

And we actually changed...

Sorry, we actually changed

all of her funds that were in her old checking account to a new bank because her mom was actually taking little amounts from her checking.

Right.

And so

we moved accounts.

Well, hold on.

It wasn't hers.

It was her mom's.

Right.

And so her mom was taking money out of the account that she set up with her name on it and just happened to attach her daughter to it.

Yeah.

And I think the frustrating thing is, you know, it was her money.

It's her money that's going in there.

She needs to stop putting money in there.

Because now your fiancé is on the hook for loans that she never saw the money for like did the money even go to the school to pay for the tuition

we that's what we're trying to figure out so we know that when she was at um

university she

we know the we know the amounts went there um and she

here in missouri we have a thing called a plus where you get your community college for free if as long as you do like you know community service hours right and so that's why she transferred from university to use those and to get her to finish her nursing program at a community college because it's the same, you know, same title, right?

So

we

don't know.

And that's why we were trying to look.

And every time we ask her mom, like, hey, how much is there?

She kind of beats around the bush and then gets gets kind of annoyed with us.

All you have to do is

two things.

One, your fiancé needs to put a freeze on her credit report

so nobody will borrow any more money against her, period.

She also needs to pull her credit report and see what else, because often this kind of behavior doesn't happen in a vacuum.

Right.

So if mom.

We did pull the credit report

and I actually have the breakdowns of, I think there's four or five individual loans.

We just can't see if they were cashed to

the university or community college or not.

So you need to contact those institutions get a balance and say, hey, was this, do I have any past due bills?

Were all these things paid?

I need receipts for all this.

You basically need to be your own forensic accountant and go back through everything and figure out what was paid, what was owed, what are all the receipts, how much loans did we take out.

And then there also needs to be this come to Jesus conversation with mom because she's essentially committed identity theft and fraud.

Right, and that's what we're concerned about because, I mean, we don't want Christmas and Thanksgiving, especially

being

homie.

That ship has sailed.

If your mother-in-law or your future mother-in-law is

enough to steal from her daughter, Christmas is over, brother.

At least for a while.

So you have to let that ship go.

I'm also going to tell you this.

You have to be your fiancé's chief supporter, not you dragging her around through a law and order episode.

You're using the words we a lot.

And y'all aren't married yet.

This is hers.

And I know you want to be a supportive boyfriend.

You're all in.

We're going to build a future together and all that.

But you need to see her also take the reins of her own life.

Okay.

Okay.

And relationally speaking, if she won't back down to her mother, I mean, if she won't stand up to her mom who's stealing from her, if she won't take this initiative, you're going to deal with this for the rest of your life.

It'll happen with kids.

It'll happen with house.

It'll happen with everything.

So y'all need to have that relationship conversation.

It's a big old red flag.

Huge red flag.

I would not get married until we solve this.

Right.

And there's a forever solution to this.

Right.

And that's, you know, that's why we're dealing dealing with this now.

First of all, we're getting married in six months.

And we are like, okay, we know she graduates in December.

Let's take care of this.

And we have had the brief convers.

We have had a conversation like, hey,

I can't be there when you talk to your mom because I'm going to be on the bad side.

And it's going to be like, why is your why is your future husband

getting mad about money?

And she needs to have that conversation with her mom and her dad.

It's not really her dad, but it's her mom.

And so we've addressed that.

We just have to get to that conversation that next point.

Yeah.

The other side of this is it may be that the same lack, inability to have this conversation, the same ability to quote unquote stand up on her own two feet,

your fiancé, it may be that mom has just been taking care of everything forever.

And

there's nothing shady going on.

She just deposited the check in her account that she opened up for her daughter when she she was 12, and she just kept the same account.

And yeah, she buys coffee with it or whatever, but in her mind, she also puts money.

Like, who knows?

Right.

So right now, y'all have a story that you can make up on one side that you're dealing with the

wicked witch of the whatever direction, or you've got someone who thinks they're trying to help.

They just put it in the same account, right?

Either way, you need to go to the colleges and find out what your balance is.

That should be a two-second, either look into a portal or a two-second phone call.

What's my balance?

How much do I owe for tuition?

And And then find out how much has been borrowed.

And if there's a gap there, then mom needs to come up with that gap, or y'all are going to either have to decide we're going to pay it, or we're going to have to go contact the non-emergency line with our local sheriff.

Because my mom stole thousands of dollars from me.

I mean, I don't want to make it so simple, but I don't want the emotion to get such a big deal.

Like, we got to do it.

Man, just go pull the reports, find the numbers, and then deal with the reality that you got before you.

But listen, Christmas and Thanksgiving are different from forever.

Okay.

That ship has sailed.

There's a spectrum here from control freak to criminal.

And so your job is just to be a support for her, help her research this, but she needs to take the reins.

She needs to regain control of whatever was lost in her life and have the hard conversations with mom.

And you just stepping in the middle of that to be the hero is not going to play out long term.

And two other things.

Don't ever, it's going to sound crazy.

Don't talk bad about her mom.

Talk good about her, support her.

And the second thing is, man, if she won't have a hard conversation with her mom now, I promise you she's not gonna have hard conversations when the stakes get higher after y'all are married.

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Kevin is up next in Minneapolis.

What's going on, Kevin?

How can we help today?

Hey, thanks for taking my call.

Sure.

So, my wife and I are currently in the market for a new vehicle, and we have enough cash saved up to be able to pay for it in full.

But my question is: why would we, if we could just save on to or hang on to the money that we have in our money market account and earn more than what the APR is on the loan.

What's your APR on the loan?

So I see my for my research, I see anywhere between 3% and 4%.

What's your net worth?

Our net worth right now is probably about

$700,000, but that includes the mortgage on our house, too.

What do you mean includes?

So if you did a net worth statement, your assets minus liabilities,

where would that put you?

$700,000.

Okay.

And what's your household income?

$200,000.

Awesome.

How much is this car going to cost?

So our budget,

we have a budget of about $40,000.

So anywhere between probably $30,000 and $40,000.

And you're planning on buying brand new?

No, I'm more of a certified pre-owned type of guy.

CPM.

All right.

Okay.

Me too, dude.

Well done.

What kind of car is this?

Just a bigger, like a Chevy Tahoe or

similar car just for a growing family.

Cool.

Do you guys have any other debt?

No other debt besides the mortgage.

Nice.

And how much money in savings total?

Total, including that vehicle fund is probably $75,000.

Way to go.

So you still have your $35,000.

Let's say you did pay cash for this.

You still have 35 left over?

Yep.

And that includes, that's our emergency fund mostly, and then kind of operating accounts for the house and just cash and

paying off credit cards and stuff like that.

Yeah.

Man, you guys have done such a good job.

What has driven you to go like, I might do the financing on this, might take out the loan?

Because it sounds like you're a Ramsey guy otherwise.

Or maybe you just heard about it.

Yeah, I don't know.

That's why I'm calling in is because I see some benefit in the long term, or at least over the life of the loan,

you know, holding on to a 4.5%, 5% savings account and also having the cash available if absolutely needed.

And I know over the life of a car loan, it's only a couple hundred bucks, maybe a couple thousand bucks, but

it is something.

You know, it's a stepping stone to.

being able to say that I'm a millionaire or debt free eventually.

A couple bucks bucks here and there.

Well, I'll tell you, the way John Deloney and I and our families, the way we just live our lives, is we just have this value of like, we don't want to owe people anything.

And you might make a spread.

I think your numbers were a little bit off here.

I don't think you're going to make 5% in a savings account.

And I think your used car loan is going to cost you more than that over the life of the loan.

And I think they'll hose you in a thousand other ways at the dealership when they find out you're financing.

But I do think there's

something to think about when it comes to the future that you guys want of going, going, do we want to have a $500 payment sitting there when we have the cash to cover it and not even think about it?

And then the other part is you can't be underwater on a car that you paid cash for.

And I cannot tell you how many people have called into the show this week who are five grand, ten grand, fifteen grand underwater on a car that has a loan on it.

And so that's the other part.

If you needed to sell it for whatever reason, wanted to sell it, you might be 10 grand in the hole come two years from now.

Sure.

Is there value in just taking the cash to the sales guy and getting a discount that way?

Bro,

that's a possibility.

Well, it works two ways.

So there's times they'll say, Hey, you've got cash.

I, the sales guy, get a bonus of 500 bucks or whatever if you will finance it.

Can you help me out?

Like, I've literally had that happen before.

And then the other day, I took money.

This is not the other day, but maybe a few months ago.

I took cash and I said, this is all I have.

And

eventually, I mean, they somebody in the dealership knew who I was.

Eventually, and they're like, oh, that's the guy works.

He's on the Ramsey show.

But he laughed and he goes, You're not going to finance this, are you?

And I smile and I go, No.

And he goes, I didn't think so.

I ended up getting a killer deal because it was the end of the month and he got a sale that day.

And they had a car on the lot that they wanted to just get off the lot.

So, yeah, I ended up getting a screaming deal on it.

I want to further what George said, though, and I think this gets left out of the calculation.

And

the new ROI for me that I am

pretty fanatical about is not the spread.

The ROI that I look for with my wife on purchases now is peace.

And

the guy who does banking for me, my Smart Vestor Pro, they all know that I'll give up 2% on a spread here and there or a potential spread, or maybe I can put this in this account and then move it to that account, but then I can, I'll give that up just to put my head on my pillow at night and fall asleep.

And not playing those games has, I can't tell you, dude.

It just gives me so much other,

like in a world of finite energy, kids, wife, government shutting down, pets' heads falling off, all the stuff.

It just gives me one big thing I don't got to think about.

That's my car.

I own it.

Nobody can take it from me.

And like George said, if I have to sell it, go put on the market for 25 grand take a ten thousand dollar bath on it but it's your 25 grand you just get it back you don't have to worry about anything you know what i'm saying so that that to me is the calculation i think gets left out a lot from the arbitrage game and if you if you came and said hey i can make 11

in three years on this and the loan um is three percent

Now we're talking real dollars and

I still won't am not going to ever borrow money, but I would shake your hand and go, if that's what you want to do, well played, man.

Like, it's not how me and my house are going to do it, but I get that.

You're talking about a point or two points, maybe, right?

And, dude, I'm just telling you.

And that's where I'm on the fence, too, is, you know, the money market is not necessarily guaranteed either.

No, I mean, rates have been going down historically.

We're at about 3.5% on any given high-yield savings account, money market account.

And so I think used car rates are also going to be higher than a new car rate on that loan.

So you'd be hard, unless you have like an 850 credit score and you're just playing the guy perfect or something.

Yeah.

You're not going to get the 1% car loan.

And even then, it's just like, what are we doing?

I think we're just playing the wrong game.

You got better, you got bigger fish to fry on your wealth building journey than trying to like, you know, finesse the system for a percent on a car loan.

Yeah.

I, and there's also another, um,

and we're kind of using you as a, as a teaching tool.

There's also this idea that I can have that car, I can sign a promissory note, and I get to keep my money.

And I think that's a false, that's a false way to look at it because the moment you sign that promissory note, that's technically their money.

They're just going to let you pay them extra for you keeping it in your account for a long time.

But you're still going to owe them, especially with a car that's going to go down in value every day you drive it.

And so I think it's just shifting.

The moment you sign that promissory note, that money in your account is theirs.

You can hold it and you can pay them handsomely for the privilege of holding it, but it's still yours.

I mean, it's still theirs.

And so I think it's easier to.

What I want to push back is, isn't the barrel the car?

What do you mean?

Yeah, they're going to sue you for the difference of what

they'll sue you for the difference of what they value it at.

In the future.

Yeah.

So if that car drops down, let's say there's a huge default that goes through the country, and we just got a note this morning that defaults are rising on car purchases across the country.

And then you can...

Repos are going up.

Repos are going up.

And suddenly they say, you know what, that car is worth 25 grand, and so we're going to sue you for $15,000.

And what they do is they'll sell it at auction for whatever they can get for it, and then they'll come after you for the difference.

And so you lose the car and you still got to write them a check.

Now, that's not going to be you, Kevin.

No, it won't.

You make 200 grand.

Is this household income?

Are you both working right now?

Yep.

Okay.

Is there a future where your spouse might not work or one of you chooses to not work or stay home?

I don't think so.

Maybe in

my wife's mind, maybe.

Perfect world, but

down in the near future.

I just, I like to make 10-year decisions.

And so it made it a lot easier when my wife decided to stay home.

We didn't go, well, we got the car payments.

Our expenses are just high.

If we cut your income out, it's going to make things tight.

And so to live with as much margin as possible is always going to be best.

And you'll stack up the cash for whatever other reason.

You did a great job saving up this money.

So I wouldn't go backwards now for the idea of a potential spread.

Yeah.

And thank you for letting us use your situation to teach.

Most people aren't in your financial situation.

You're doing a great job.

Bro, I just take a check down there and say, I want that car for this check.

Let me walk out the door and see what you can make out.

That's a baller move.

Dave, we got a lot of calls on this show where life happens.

One day someone's healthy, they're working, providing for their family, and then a curveball hits.

You You know, we hear it all the time.

A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes.

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

Yeah, that's right.

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Yeah, it's important to understand the difference between them.

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Jonathan is in Montana.

Jonathan, welcome to the Ramsey Show.

Hi, how are you, guys?

Great.

How can we help today?

So,

I had a previous marriage that

in the court case, I requested my business documents.

She never returned them.

Long story short,

for the two years, we owe $23,966.

In the court documents, she agreed to pay her half of it.

And

still to date, which we're going on almost three years, she has not paid her half of it.

And I'm finally at a point in my life where I have a chance to pay off a bunch of debt.

My fiancé, who is very soon to be my

wife, I would like your guys' advice on whether

if I marry her,

if I should just pay the IRS off and deal with a couple of these other debts and just move forward with my life.

So it's it's she owes about 12 grand, 11.5, something like that?

Yeah, something like that.

She filed for an innocent spouse relief and they denied it due to the fact that she knew full well what she was signing.

So are you going to take her back to court and get the money?

That's what I was asking is is it something where I should just let that one loom?

Or

should I just pay the IRS off so they're not breathing down my neck?

And you tell us.

You tell us.

Which one sounds more fun?

Taking her back to court actually sounds a little entertaining considering how the judge left on my side, absolutely.

So you'd have to file a motion for contempt, request some money judgment, and get the judge to force her to pay, essentially?

Yes, 100%.

And that could take how long?

Another year?

At least.

Well, is it going to cost you lawyer fees?

Your new wife is going to be like, you're going to court to see your ex again?

Cool.

Have fun.

No,

she's fully on board either way.

She's actually the reason I got turned on to you guys and how I have made this huge transformation in my life.

On a side note, I mean,

before I met her, I was well into $120,000 in debt.

And to date, today, I've paid off $77,362.

Dang.

Way to go.

Congrats.

Do you have the money to just pay it off today?

I've been working my payoff, and as soon as I get these next couple checks from these next couple jobs, absolutely.

I should have enough to pay off the IRS and hopefully everything else that I owe to anyone.

What would it cost you

to hire an attorney to go back to court?

Well, my last experience cost me $45,000, so I'd hope it'd be less than that.

But just a rough.

I hope so, too, considering there's $12,000 on the line.

So let's pretend it's gonna cost you five.

Someone's gonna charge you a five thousand dollar retainer, they'll file the paperwork and they'll show up on one day at court with you.

Okay,

so the question asks, and I have I'm just made that number up.

It might be double that, it might be a thousand bucks.

Who knows?

Is $5,000 worth it?

Or can you write the check and have this woman out of your life forever and move on with your life?

Yes, to an extent.

I mean, granted, that would net me about seven if she actually is paying it.

Oh, sure.

No, I'm saying five from the

five thousand from the

lawyer fees.

Here's what I'm hearing

in my head, is I'm hearing a conflict between peace and justice or peace and ego.

And ego and justice can be wrapped up together a lot.

The right thing to do is for her to pay her half.

No question.

The judge hit the gavel, said she owes this.

And she hasn't, so it's still on your credit.

The IRS is going to come get your stuff, and you have a legal document saying we can unwind all this, and we can go through court and get all the friends, blah, blah, blah.

We can do all that.

You're right.

I just want you to do the calculation on what piece would cost you.

That's where both of us are on it.

Say and I have just both agreed that

is that worth.

I think my big question for you guys, and you may not be able to answer the question, is

she owns her house, and

me marrying her and still owing the IRS, does that open her up to any

chance of them coming after the house?

Because ultimately, that's my goal, is to get myself out of debt, pay the rest of her house off.

to where they can never come.

No, I don't think they're coming after your house.

I mean, worst case, there could be like a wage garnishment situation.

Again, I'm not an attorney.

I don't know the state laws.

And so I would at least get in touch with an attorney.

It sounds like you want some justice and closure and you want some her to pay.

Now, what I might do if I'm in your shoes, I might just go ahead and pay it and be done with it, get the IRS off my back, and then still go to court and get her to pay and as almost like a form of reimbursement.

That's what I would do.

Because then at least it's off your record.

We're done with the IRS.

We're moving forward with our new life and wife.

And we're still trying to get that closure in justice.

Okay.

I appreciate that advice.

I don't know how much more time we have, but I also had a couple

on my big list of all the debts to pay off.

I had one creditor that refused to talk to me because I disputed the charge because they couldn't tell me where the charge came from.

And that one has since gone to court.

And, of course, they got a judgment against me.

Nothing I could do about it.

How much?

Is there a way I can deal with that?

How much?

$1,268.

And was it your debt?

I honestly don't know.

During my last

marriage, I was basically forced out of my house, and she had access and was a legal signer on all of my cards.

I mean, legally, they have to validate the debt.

And so if they can't do that, it'll get tossed out.

But if it's a love seat that she purchased, you're not going to get that money back.

All they can send me, and to date, all they have sent me is an invoice for the debt, not saying when or where it was spent.

There's nothing to actually really validate it.

Again, it's not going to hold up in court if they can't validate it.

And so it'll get thrown out.

If you want to continue down, you're already going to be in court, it sounds like.

Might as well just hang out there, clear some more debts while you're at it.

What other debts do you have?

The same creditor company.

I have one for $9,866, which as soon as I get paid for this next big job, that one is going away.

What if you called that same creditor and said, I'm going to send you $10,500?

Can we just be done with all of this?

That would be ideal.

Call them and tell them that.

I'm going to clear this entire debt.

You still write your check for $10,000, and you're going to mark this paid in full.

Okay.

Do you think there's any chance with them having an already won judgment against me on it?

Of course.

There's always a chance.

Always a chance.

Negotiate it.

Of course.

There's always a chance.

But if you've got $10,000 and you're about to write him a check, my gut tells me they might take that.

Or they might think, oh, he's got more money.

Who knows?

Here's the calculation I want you to do.

You're so close to being free.

Like you're unhooking these chains from you.

And now you're at the very end and you're starting to count the chain links and you're forgetting the big picture.

I can be,

if somebody's looking at the way I live my life, they could say, that dude's a sucker.

And they'd be right.

There's things I would just walk away from because I want peace.

Right?

You'd have to ask yourself, what is that line for you?

If I'm about to get two checks for 35,000 bucks and it's going to clear every debt I have, including this ex-wife who I'm still waking up thinking about every day of my life, I'm going to write that check and brush my shoulders off and go on about my life.

But again, that's just me.

And I have other friends that would fight.

They would spend 50 grand to get her to pay her 11.

You just have to do that calculation in your head.

Yeah, that's the situation

I don't want to be in is where I'm just spending more money just to have to see her in court again.

And

I couldn't agree more wholeheartedly with you on that.

Me and my house, we try to solve for peace.

I'd be done with it, man.

You're about to bail yourself out of jail.

I wouldn't be trying to get a shorter sentence on good behavior here playing this game.

Just be done.

Hey, you guys, more than 100 million Americans carry medical debt, and that is so scary.

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aubrey is in dallas texas up next what's going on aubrey

hey guys um i have a quick question i am i started on october 1st with you guys i've done my baby step one got that out of the way so i'm starting baby step two awesome um and as i was as i was reading um the total money make over

i'm sorry i'm nervous i'm shaking well hey uh real quick aubrey can i tell you something

Can I tell you something cool?

I'm really grateful that you're in our gang now.

I was looking at the calendar.

I was like, we're nine days in, and Aubrey is like, she's got baby step one done.

She's calling the show.

Like, you're serious, dude.

Congratulations.

I am.

I've read the Toronto Money Makeover, and now I'm going with a highlighter, and now I'm going back into it, and I'm just reading the chapter that I'm in, and I've already gotten a sidekick.

What brought you here?

Like, what was going on in your life that you just said enough is enough?

October 1, I'm out.

My 20-year marriage ended, and I have three kids, and I want, I sat them down because they're older.

older, they're 19 and 16, twins that are 19, and my youngest is 16.

And I sat them down and I said, I want to do better for you guys.

So I'm sorry, I'm going to cry.

So I sat them down, made them watch the baby steps intro thing with me and made them be on board with me and hold me accountable and

made them understand why I was getting a side gig and why I wasn't going to be around as much.

And so

that's where I'm at.

And that's why I'm super gung-ho.

All right, so listen.

this is not why you called, but I got to say this.

I grew up in Houston, where there was a lot of hurricanes and tornadoes, and a lot of times when the lights would be out for two or three days, and when the lights were out after a storm came through in the middle of the night, there was always somebody on the street with a flashlight outside, and everybody walked towards that person.

And right now, you're that for your kids.

That's what I want to be.

I'm going to get the homeschool foundation thing and no.

No, no, you are.

going to sit down and go through that.

You are.

That's what I want to be.

The fact that you sat down with your kids in the dust and ash after a 20-year marriage ended and you said, hey, I'm going to own my part of this.

Here's what I'm going to do moving forward.

And this is scary and I'm crying.

You gave them a gift of seeing you grieve.

You gave them a gift of saying, here's what I'm going to do next.

You're doing everything right.

And I want to tell you, I'm proud of you.

It's awesome.

Thank you.

It has nothing to do with why you called, but I want you to know you're holding the flashlight out in the dark and your kids can see it.

and that's a gift right now.

Good on you.

And we're glad you're with us.

Thank you.

Me too.

All right, so what's your question?

So my question is, when I was reading the debt snowball portion of the total money makeover, there was one caveat to listing your debts from smallest to largest, and that's when they're super close in number.

And then there was like a little subject in there about interest rates.

And I am not financially savvy, so I needed help because they're super close in number, like 50 to 100 bucks close in number for three of them that have all three different interest rates and payments and so I need help doing which one first

okay well I'm I'll tell you what I'm a fan of whatever one has the biggest payment you're that you're gonna free up I would just attack tackle that one first

okay because if it's 500 bucks for that payment

versus 700 well I'd rather free up the 700 700 payment to attack the next debt with

Okay, so it doesn't really matter about the interest rate.

Go buy that

much more to the

They're going to be gone so fast.

Yeah, we're talking about dollars and cents on the interest savings.

And we found that, you know, that's the avalanche method: focusing on highest interest first, and almost no one actually does it because you have to be a super math nerd, which in that case, you probably didn't go into crippling debt.

So

the snowball method is, it tackles the psychology, gives you momentum.

So, how much debt do you have total?

Oh, God, without the house or with the house?

Without the house.

Leave that one aside.

Without the house.

Yeah, without the house, it's about 80 grand.

Okay.

And what do you make?

I make

with bonuses, it's like 94 grand a year.

And then I just got my 1099 side gig that starts in November.

That will bring me, starting out, that will bring me in for

only $400 a month.

That's only one patient.

If I'm a nurse, then they're going to give me more.

Awesome.

That's a great side gig.

Okay.

So we're going to call it $100,000, right?

Okay.

Have you done an every dollar budget before?

i have i really i got the premium so i'm i've got that going i did you pay for it because i'm tracking my transaction i did we're gonna refund you we got you

okay will you put it towards your debt if we give you the money back

yes and that's why i'm i'm i'm emptying out a storage unit too bringing that back to my garage so i can have that money back to throw it at my debt like i'm i'm seriously cutting the budget like crazy

here's why i mentioned that budget that budget's going to show you how much margin you have right so how much do you you have right now to throw at each debt every month or, you know, your debt snowball?

So I'm still trying to collect all the data on that with the tracking my transactions so I can be actually precise with how much I spend for like groceries and such like that.

Right now, I'm throwing about 800 more.

I think there's more room in there, but I'm just I'm still trying to track every transaction so that I know where to cut the most.

Perfect.

It'll take you about three months to level on that, so don't freak out, okay?

It'll take you you to about January before you fully got this thing cooking, where you know about what the groceries are going to be, yada, yada.

So you're good.

Right, right, right.

So

that's why I did the premium when I got it.

So I was like, I need to know exactly, especially gas, all that jazz, and then

just start chunking stuff out.

All of my side gig is going to go straight to

straight to the day.

Can I ask you a hard question?

Yeah.

Can you afford this house?

No, no, but I've got to get the divorce.

It's not finalized.

The divorce has to be finalized before I can sell it.

Yeah.

Do you know how that's going to shake down?

Are you going to have any alimony or child support?

Or, you know, are you guys going to split the house?

No, I have child support.

And then,

honestly, we had the house for sale.

It was on the market for nine months.

Didn't get a single bite.

But now interest rates apparently are going down.

So there's been increased interest, but he's not signing anything right now.

And so we're kind of, and we had to slow down because the kids were taking it really hard.

It was too much too fast.

So I had to slow that down for my kids' mental well-being.

That means more to me.

I will sacrifice for my kids' mental well-being.

I know, but it feels like what feels like mental well-being can be disrupted on the other side by drawing this out.

Right.

It's almost like pulling a bandaid off a toddler, right?

It hurts and so you stop and it hurts.

So you stop.

Man,

having a mom that has still got this guy hovering over who's already blown your life up and now won't sign the paper.

Like, there's just going to be an inherent tension in your house.

There's some powerful catharsis about just getting this thing over with.

Right.

So

I don't know what slow it down means, but if you have an attorney, I would hire a bulldog and say either he won't sign it or we're going to run this through the court and I want to be in court by this date

and have the judge know that he wouldn't even sign anything.

He wouldn't play ball.

He's just going to try to drag this out.

And

I've seen some judges be really compassionate for jerks who blow people's lives up and then are like, oh, can do nothing.

The judge can get pretty caustic there.

So I would push that.

Well, he's not being a super jerk.

He was pausing it.

Well, I'm going to say that because

I never put myself first.

That's a nurse's MO right there.

So I'm going to, he's not, he's not a jerk.

I wouldn't have stayed with him for 20 years if he was a jerk, to be honest.

He said he needed advice before he agreed to the terms of walking away from the house, even though he's already moved out and not paying for the house.

But

it's it's one of those symptoms.

But it's, I can't really take an offer with his name still on the house without an agreement saying how we're going to split those proceeds, if we're going to split those proceeds, et cetera.

That's kind of where the limbo on that was the house on the market.

I would push that every way to Sunday.

I'm trying, but I also can't afford a lawyer at all.

I would put that as a priority.

Yeah, the house is looming in your life, and it's a big question mark, and I think once that's solved, we'll know how to move forward.

Is there any equity in the house?

There's about 60 grand of equity in the house.

Okay, you may be able to, maybe not, but you may be able to get an attorney who will go through this process with you with a guarantee that when the house sells, they'll get their percentage off the sale of the house.

That's true.

I didn't think about that.

It'd be worth having that conversation with somebody.

Do you have a good real estate pro on this?

I do.

It's a local local group, but they're big in our church.

They're big in our band program

in the community, so they're super awesome.

All right.

Well, we're wishing you the best, Aubrey, through this just awful, traumatic situation.

And I'm inspired by your attitude towards it all.

I'm going to send you Building a Non-Axious Life, my book.

I want you to read it, and I want you to use this as your roadmap for you and your kids moving forward.

Hang on the line, we'll take care of you.

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Welcome back to the Ramsey Show in the the Fairwinds Credit Union Studio.

I'm George Campbell, joined by Dr.

John Deloney, open phones at 888-825-5225.

Allison is in Oklahoma up next.

What's going on, Allison?

How can we help?

Yes.

Hey, guys.

Thank you so much for taking my call.

You got it.

What's up?

Well, hey,

anyway, my husband, Michael, and I, he's sitting next to me.

He's about to take over for the financial portion.

He wanted me to kind of communicate our backstory.

Or the opening act.

You go first and see if they're nice, and then I'll fill it.

Right.

Well played, Michael.

Well played.

I'm a speech therapist and he's the eye doctor.

So we each have our own strengths here.

Well played.

Are y'all in Oklahoma City?

We are near Oklahoma City, yes, just about 45 minutes.

Okay, will you do whatever magic you need to do and just make sure OU beats Texas this weekend, please?

Right.

My husband would love that.

He went to undergrad there.

Okay,

I just need y'all, before we talk, I just need you to make that happen.

All right, go ahead with your question.

Okay, well, hey, so the reason we're calling is our family of now five, we just gave birth to our third baby a few months ago

to really stir up the joyful chaos a little bit more.

Yeah, so we're currently in the most rigorous, exhausting, yet life-changing seasons of our lives.

We're small business, we're small business owners of a new optometry practice that we opened here in our small town.

My husband husband is the eye doctor of the practice, and then we opened up the doors a few months ago.

It's a really good location.

We really haven't even had to do much advertising since it's right here at the heart of this small town that is underserved with optometry.

So it's working out in that way.

Prior to working here, my husband is working with his father for the first five years out of school.

His dad's 75 and just retired this year.

So

anyway, we had the opportunity opportunity to potentially take over that practice.

However, our family was not exactly fruitful spiritually in that town.

And financially, we were doing okay, but the Lord was calling us to do something that didn't really make sense really to anybody else.

If that makes sense,

it kind of almost looked like to a lot of people we're missing out on an easy opportunity to take over an already established business.

So you didn't take over.

You start this new one.

That's right.

We didn't take and that's going well It's going well

So what's your question

Well, so essentially

We're only able to be open here a couple days a week until we get more patients in the door

and right now he's working for an eye doctor three and a half days a week in a different town just to to make ends meet You know, we've got to keep the mortgage paid each month at our house and keep the lights on.

And you're working in this business or are you at home with the kids?

So Fridays and Saturdays,

our grandparents have been a saving grace for us.

They all alternate helping out with the kids.

So yeah, I work full-time with my husband on Fridays and Saturdays to get everybody in and out the door with the patients.

Okay.

And what are you guys paying yourselves?

How much do you make?

Well, so that was kind of our question.

We're not paying ourselves anything yet.

And so that's kind of where...

How are you paying your bills?

Right.

So

his three days a week?

Yeah, so three and a half days a week.

We're paying our, he has the opportunity to make commission with his other eye doctor.

So he's basically still making a five-day salary.

It's very, it's trying on him.

He sees about triple the amount of patients that he normally would.

Sure.

Some of that is

starting a new business in a small town from scratch.

How much did y'all get underwater?

How much did you borrow to start this practice?

$200,000.

Okay.

Are y'all?

Do y'all make enough money to pay that down?

Well, so the loan that we took out, it only has 2% interest rate.

It's through his dad, actually, and he's allowed us to put that on hold for a little while.

Yeah, yeah.

So

let me my husband wants to do the financial portion.

So anyway, I appreciate y'all.

You got it.

What's up, Michael?

Is he with us?

Is he in the room?

Well, we tried.

That was fun.

Michael.

Did you leave us?

Dude, you left us.

I hope we're still here.

Oh, okay.

Thank you so much.

One second.

I was waiting for some hold music or something.

That would have been nice.

You should have started singing, George.

That would have been nice.

Michael, you there?

Put the spreadsheet down, brother.

Sorry.

No, I was trying to take a phone call.

A patient was calling the music.

No, you're good.

This guy's all.

Patients are more important than radio nerds.

Let's get to the root of the question here because I still haven't heard one yet

okay

so

one thing that I would say for business wise I know what the number is to keep lights on and essentially continue to

stay afloat

it's right around

$9,400 a month and so one question I would have for for business wise

what how many months would need to be put aside before, because right now we're not paying, I'm not paying my wife, I'm not paying myself any salary.

And you're not paying the loan.

You're not paying the payment on the loan, the 200 grand.

That one's paused, but I'm still paying the mortgage and the equipment loan that I have.

Okay, that's all $9,400 for all in right now, and that's not covering anybody's actual salary.

Correct.

That's just

as cheap as this business is going to run at this point.

Correct.

Okay.

And what is it bringing in every month?

We just started having more patience.

Give me a number over the last two weeks.

Is it going to be 10 grand this month or 20?

This month, it will probably, it won't be 20.

It would probably be around breaking even, around 10.

Okay.

Well, the good news is you don't have to worry about paying yourself because you can't.

So if that's the question, that was an easy math problem to solve.

Ideally, you cover all of your operating costs, your taxes, federal and state, self-employment, and you have have a little bit to throw into a growth and self-you know, investment buffer as kind of retained earnings, and you're paying yourselves a decent salary.

Right now, that's obviously not on the cards.

A dream retained earnings is 25%, but that's really hard to come by.

Okay.

If you can have like three to six months of your expenses, you got 30, 40, 50 grand in there, that would be a good starting point.

But then before you really start looking at salary and all that.

Well, I mean, you guys need enough to cover your bills.

You're not eating.

And service your debts.

Do you have any other debt outside of the 200?

200?

So that's the thing.

I work for an optometrist outside of me starting my business to pay my personal bills and to live and to put food on my table.

This is just so until I get full-time, and then it'll be

full change.

So what I'm looking at is if I can be full-time, I would start adding essentially a day here and there whenever I start booking out two to three weeks in advance.

Do you have any sort of,

here's the thing.

You probably jumped off the dock before the boat got in and now you're treading water.

Because you got five kids, you got a newborn, you got six days a week, you got a business that, and your Thanksgiving is going to be awkward this year because

you owe your old man whose practice you didn't want to take on 200 grand.

Like there's just a lot going on here.

And so you can't do this forever is what I'm saying.

But you're here.

you've already borrowed all this money, you've already launched it.

I would, George, tell me, I'd get really aggressive about marketing, finding people.

Get the boat closer to the dock here.

And this business needs to be making 20, 30 grand a month just to pay yourselves something.

Yeah.

And so you're going to need to figure that out.

And if this doesn't work six months, a year from now, we got to close up shop and go, this experiment didn't work.

And I just got to work for someone else right now until we're in a better financial position.

It may be that wife is also at home doing crazy marketing towards this thing.

She can help do that as well.

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Today's question is from Meredith in Oregon.

Meredith writes, I'm a divorced mom of three boys who are 24, 22, and 19.

I earn about $48,000 a year.

My sons went into the workforce right after high school, and the two youngest still live with me, the 22-year-old and the 19-year-old.

While they contribute to the household bills occasionally, they struggle to keep up.

When they can't, the responsibility falls back on me.

I've talked with him about paying me a set amount each month that I can count on rather than paying individual bills, but they say they don't make enough money to do so.

I know they do, but they have other money priorities.

Thankfully, our home is paid off.

How do I communicate to them that I need help financially?

I'm not looking to push my kids out, but how do I balance supporting them while also making sure I don't sink under the weight of all that financial responsibility?

Yikes.

Here's the truth, the reality that is hard to hear, but this is just the truth.

You're keeping your boys around because you want them around

and you need them around financially.

What does that mean?

That means they're not getting a chance to go carry the weight of adult responsibility, of bills, of, well, I just don't have it this month.

That doesn't work like that if you have your own apartment because they kick you out of your apartment.

They know you're not going to kick them out.

They know that.

And so I'm going to quote my friend friend Henry Cloud who says, the greatest gift these boys could get is some problems.

They have to understand the weight of the squat bar that is real life.

Light bills, water bills, rent, or you don't live here.

The second big challenge here, George, is she doesn't have enough money to keep this place.

Yeah, it's not to teach them a lesson.

It's out of necessity.

Yeah, you don't have enough money.

Both hands.

So the second biggest issue here is $48,000 a year isn't cutting it.

So I know your house is paid off, and I would do anything I could to keep that house if it's paid off.

But if you can't afford it, you can't afford it, you can't afford it.

You have a math problem.

And so either you have to sell this house and buy something much, much, much smaller or rent for a season, or you're going to have to find

a job making more than $48,000 a year.

Otherwise, your boys are going to find themselves in this perpetual dance of, I can't leave because otherwise mom's going to get evicted, and that's a lot of pressure on them, or they're not allowed to leave, or what I think is happening is they don't have to leave.

And if they don't have to do anything, they're going to act like kids and not do anything, right?

And so

it's hard conversation season here, both for them.

And I would suggest letting them, not letting them, telling them they got to leave or they got six months.

And then you dealing with the reality that my $48,000 a year, I can't afford my life that I'm trying to live right now on the money that I make.

Yeah, if you need them as renters and you need that income, it just points to a bigger problem that is not the children's fault.

Correct.

So there are two problems here.

One, the children need to understand you got to pay your bills in real life.

That needs to be the priority.

You're getting evicted.

You're getting evicted.

Yeah, whether it's with her or with someone else or with an apartment complex, the four walls come first.

You got to cover those as your priorities.

Now, at 19 and 22, I had other money priorities too, like doing anything other than paying bills.

Exactly.

So there's always going to be another priority if you let it be but at 19 20 and 22 I had my own place at college and then after college they they didn't care like what my other quote-unquote money priorities were they wanted their rent so I had to pay that rent or I couldn't live there right

and they have to learn that responsibility now Otherwise, they're going to be the 42-year-olds in the basement playing video games.

Mom, make me some meatloaf, right?

It's going to be them.

Yep.

And

it's a hard truth to wrap your your head around.

And Meredith, let's be honest, underneath all of this is if all three of those boys moved out to start their life, that house would be really quiet.

And it's lonely.

And you couldn't afford it.

And you can't afford it.

So there's a lot of hard truths staring you in the face that nobody in that house wants to deal with.

That's honestly the only path forward.

And I'm going to tell you right now, there's no comfortable way to do all of this.

There's just a reality.

The uncomfortable conversation will never go away.

It's just going to get amplified.

As the old saying goes, conflict deferred is conflict amplified.

There's going to come a day when these three boys go get married and they leave you overnight and you can't afford this place or they never leave and you still kind of confess right.

So the conversations are common.

I'd rather them be on your terms and directed and intentional by you.

And again, George, this is one of those things.

I know I come from a different generation.

I sound like I'm an old man.

I went uphill both ways to school in the snow.

I get that.

I can't wrap my head around

not helping mom out if she needs it or what?

I can't wrap my head around being 24 and still just crashing.

I can't wrap my head around,

yeah, watching my mom suffer and I'm living there and be like, no, dude, I don't have the money.

And her knowing you did, but you chose to go out with your buddies or you chose to get a fancier new cell phone or whatever.

I can't wrap my head around any of this.

And so it's hard for me to put myself there.

But I do regularly talk to the boys whose moms didn't let them grow up and i talk to the moms who have to sell the house that they didn't want to sell and it's never a fun conversation i just wonder maybe she hasn't had an honest enough conversation about where she's at financially of like listen i'm not doing this to teach you a lesson at this point i'm doing this because mom's struggling right now and i i need everyone to pitch in to cover the bills to keep food on the table keep the lights on and if you can't do that then this may not be the place for you because I can't I'm I'm relying on you to be a support in this.

Or I'm going to have to go find other renters who will help me pay my bills because I can't afford it.

That's tough all around.

So sorry, Meredith.

All right, let's get to Amanda in Arkansas.

What's going on, Amanda?

Hi, can you hear me?

Yeah, loud and clear.

Hi.

So

just quick background.

My husband's a teacher, bus driver, and I'm a disabled vet stay-at-home mom.

And we have six kids.

Our kids are getting older, 15 and a half being our oldest.

We're debt-free beside the mortgage.

We invest, we add to their college funds.

My question really is, is it a good idea to sell our home for a lesser mortgage so we can pay it off faster and we could invest more, we could help more with the college funds and all the things that older kids are needing and starting, and we're starting to see the costs of what it is to have older kids.

Wow, that's a big decision.

I mean, you're talking about eight people.

How much smaller of a house can y'all move into?

Oh, well, so we do love our house.

I do think we could get something that's less and still be happy.

Our house, we owe like $130,000 on it.

You know, we live in northwest Arkansas where cost of living is pretty low.

I think we could probably go with something that would probably knock off like, I'm guessing about 40 grand off of our

I don't want to be rude.

That's just not very much money.

no that's not like funding all six kids college level money and the other thing is is the is the mortgage a problem like what is the mortgage compared to your take-home pay

no the mortgage is not a problem we pay extra on it it's a 30-year mortgage but uh we pay it like it's a 15 or normally we even pay more on it okay well here's the good news we're hoping to pay it off in like five to seven years but i'm thinking like if we were to buy a house that is less then we could knock off even like two to three years off that well the good news is there's no Ramsey mandated rule that you have to pay off a house in seven years or else you're a terrible person.

So that you have to pay for all of their college.

Yeah, exactly.

That's the other part that we haven't talked about is what can they be doing to help cover some of that cost so it's not all on you to have you know 200 grand per kid by the time they're 18.

So I don't think I personally, just based on what I've heard, I would not downgrade your home.

I'm not either.

It's not going to be the savings you think.

And the other good news is they're going to be out of the house eventually and you'll have that margin back, which then you'll throw at the house house and it'll get done in seven years instead of five and we'll still high five you then and here's the thing

um we uh my wife and i it's just a thing we do we could just write checks for everything my son wants to be a part of he's 15 and my daughter's nine yeah but they have to participate in some of that

And it's, I think the thing I would rather you do than, by the way, if you sell your house, you got to take 6% off the top or 7% because you're going to have to pay real, like that 130 is going to dwindle real fast.

And then moving costs and all that kind of stuff, I'd rather you sit down with the kids and paint them a real picture about if y'all want to be involved in these things, we're going to do this percentage and y'all going to do that percentage.

Let them be a part of this.

That's the better long-term lesson.

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Carissa is in Fort Wayne, Indiana.

She explains it all.

What's up?

Carissa.

I think that's Clarissa, actually.

Oh, my bad.

It was Clarissa.

I apologize, Carissa.

Sorry.

Oh, it's okay.

I just want to start off by saying my husband's a huge fan of yours, John.

Well, good.

I'm glad you're not.

Just your husband.

Tell your husband, shout out.

No, I am.

I am.

Sure.

That's not what I meant.

Non-plan, toy plan.

What's up?

So, my husband and I are currently in the city.

Hey, your phone is really cutting.

Yeah, it's cutting out.

Talk directly into it.

Sorry, I have really bad service where I live.

Okay.

Fort Wayne people.

They're really struggling out there.

Well, it's like the rural area outside of Fort Wayne, so it's really bad.

We have paid off $152,000 in debt.

We currently have 30 still to pay off.

We are both active duty.

And as you know, the government's shut down, so we don't even know if we're going to get a paycheck on the 15th.

Oh, geez.

Can I just say I hate this for you?

I hate this for you.

I'm so sick of this.

Hold on, take a breath.

You're good.

You're good.

No, take a breath.

You're here, like, literally serving your country.

And you're a pawn in this weird scheme.

And you've become a chess piece and other people, it's just, I hate it.

I do too.

As a taxpayer, yeah, you're like, you're like, tell me about it.

I'm not the one.

Yeah, you're the one not getting paid.

As a taxpayer, can I just tell you, I hate this is happening to you and it shouldn't be happening i'm sorry i appreciate thank you for loving my family and george's family taking care of us i appreciate you this sucks this is stupid

it does it's not fun especially with bills still having to come out um man

so usaa is offering a government shutdown loan for those basically they're paying out interest-free to cover what our what service members are not receiving from the paycheck.

It's up to the amount of their paycheck

I am on the fence about it because it's interest-free it's enticing

payback

I wouldn't do this

well you're calling the Ramsey show so obviously you know

but listen

I know I'm not gonna get a yes answer but listen one of the last bargaining chips I heard was I'm not gonna pay any back pay

well I will get back pay there's 0% interest I'll receive my back pay no no no no no I'm saying is one of the last bargaining things I heard was if if this doesn't, if the shutdown continues, I'm not giving anybody back pay.

That was one of the side, I don't remember which side, that was one of the sides arguing.

As in, what if that paycheck doesn't show up and you still have this loan hanging over?

Correct.

So that's something to think through.

Do you guys have anything in savings right now?

Well, we just have to start our savings right now.

So you have a thousand bucks?

Which is a thousand.

Yes.

Okay.

And what is your next bills that are coming up that you need to pay?

Our utilities, daycare, because we still have to go to work,

tuition, and mortgage.

Tuition, mortgage.

Okay, what's the mortgage?

$2,000 a month.

And what do you guys normally bring home in a month?

We bring home in a month.

Well, each paycheck is a little over $3,000.

So

$6,000?

$6,000

or $6,000

for me personally.

And he brings home the same amount.

So So you guys have $12,000 coming in normally?

Yes.

Okay.

Okay.

That's good.

You guys have a great income.

That's fantastic.

And you had 30K to go.

So what I would do is pause all of your debt payments right now and just cover the four.

We've already made those payments with the first month paycheck.

Okay.

Before we knew what was happening.

Right.

Yeah, because you guys are in storm mode.

So the only thing we're trying to do right now is keep the lights on, keep food on the table, keep the mortgage paid.

The rest of the debts, we're just going to pause.

If you can't pay your minimum payments, you can't pay it.

Your family is going to come first.

And so the thousand bucks will get you to utilities and partial daycare.

I don't know if you can work something out with the daycare.

I know.

She's got a bunch of military families that she's watching, so I'd have to talk to her.

I imagine they're going to work with them to go, listen, nobody can pay daycare right now.

Right.

And so maybe they'll allow you to pay that on the back end.

And the tuition is for what?

My two middle kids,

school.

Yeah, and I'd go knock on their door too right now.

And it's embarrassing and humiliating.

And I hate that you're in this situation.

It's so dumb.

It is.

But the good news is it's no fault of your own.

I think people are going to be hopefully understanding in a one-to-one conversation of, hey, you guys know what's going on.

Here's what's happening.

As soon as this shutdown's over, we'll get current on all of our payments.

And same with the mortgage.

Contact your mortgage company.

Let them know what's going on.

And so then you know at least you have priorities of what needs to be paid based on how those conversations went down and what's going to happen if you don't pay.

My guess is everybody will be supportive

and maybe one won't.

Maybe one will say, sorry, we got to have our money.

And that would be the one that y'all focus on.

And you're, I mean, you're literally going to in store mode, meaning no going out to eat, no movies, no, no, you'll play.

It's going to be like a creative, hey, what's in the freezer?

Let's get play a game.

What can we make out of this?

It's hunting season.

Get after it, husband.

Right.

And it's also like, we've got to go do, can you guys go do side hustles?

What's the legality of you guys taking on some side work?

We have to have approval from our senior leaders before we can start having an additional income.

Okay, I would have that conversation today.

Okay.

And again, the beauty is, like George said, you're not, I mean, everybody should be lining up in front of the senior officer's office saying, hey, I need to go drive Uber because when I get off shift until midnight, because we don't need money.

right

so those that's the hard truth is right now let's just do whatever we can to sell stuff to take on the side hustles to cut our expenses down to the bone to have the one-to-one conversations with anybody we owe to see if we can kick the can down another week another two weeks until this is all settled and we know what's next but i would not take out this loan and i and i i totally get if i'm in your situation i I'm telling you, as much as I hate borrowing money, I would consider that.

You're not crazy.

Right?

You're not crazy.

But I'm just, George and I would not have a job if every loan that people took out with a plan worked out.

Right.

And the threats I've seen thrown around on all sides of this mess, we're going to fire everybody.

We're going to not do backpack.

I just don't trust anything to play out like it should.

Otherwise, we wouldn't be in the situation.

Right.

And there's that famous quote.

I'm from the government and I'm here to help.

This is the most scariest quote.

This is also like, I'm a lender and I'm here to help.

That's also,

that's some scary words right there that I would, I would, you know, take heed, take caution.

And so I would fight as much as I could until your back is so far up against the wall, the lights are out.

And then I'm going, okay, we had no other route to go.

I would borrow, you know, money from family.

I'd start a GoFundMe before I took out a loan.

And I do think

that.

I do think this is important.

The earlier you get in front of this, I'd call the mortgage company today, even though you may not have to pay them for another two or three weeks, and just say, I'm already trying to make plans.

You know that I've never been laid on my mortgage.

We're in a dual, a military house.

The government's not sending us the payments they promised us, but we still have to go to work.

Do y'all have a plan?

Can we pause?

And I almost guarantee you, they'll say, absolutely, we got you.

Okay.

And I can't guarantee that.

Let me take that back.

I would be surprised if they didn't have a plan in store because you're not, there's millions of people across the country having to make that call.

Right.

Right.

What I don't want to have happen is you go borrow 10 or 15 grand, you'll exhale, you get through this month, and then the back pay doesn't come.

Yeah.

And then USAA, even though it's 0%, like they want their money back.

And it'll, they'll go, well, now that was a, that was a one-month thing.

Now it's going to trigger, you know, 15%.

It was 90 days, no interest, but now we're going to charge back.

Who knows what's going to happen down the road?

Right.

Right.

And I appreciate, I'm going to say something crazy.

I appreciate USAA reaching out and trying to keep people afloat.

I get that sentiment.

I just think you're in a situation where you can go knock on some doors and make some phone calls and tell everybody two weeks, three weeks before, hey, we're in a pickle here and everyone in this community is in a pickle.

We just want you to know we don't have any money right now.

And hopefully they'll say, yeah, we get it.

Just keep sending your kids, keep taking care of stuff.

That's not going to work at the grocery store, but hopefully for those big expenses, it'll hold off.

And hopefully,

we get this nonsense.

This is what Congress isn't seeing.

These are really

people.

And it's not even Carissa.

It's the person who runs the daycare center who's not going to get paid.

And triple down.

There's a lot of people that aren't going to get paid.

What a nightmare.

It's just a nightmare.

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Cassie is in Montgomery up next.

What's going on, Cassie?

Hi, fellas.

Thank you so much for taking my call.

Absolutely.

How can we help?

Okay.

We purchased, my husband and I purchased a second home when our oldest child started college because after a couple of years, we figured out the game in college towns.

And by the time they graduated, we were going to be bankrupt, like they upped the rent every freaking year.

So we found a pretty cheap little house and bought it.

And our youngest child is now in college.

So everything is is just clicking off until our oldest child got married and decided not to leave so he is

so your short-term real estate game is now long-term and your renter is also your child

yes hold on you're the landlord you can make them leave

oh no i would never do that we want to help them buy a house they they i mean i know you know how difficult it is for young people they're both working full-time they've They've only been married two months, so it's not.

But they were originally moving to her city, and that just like changed just before the wedding.

She was offered a new job in town, and so he didn't have to move after all.

So

where is this house?

It's in Auburn, Alabama.

Okay.

So not too far from you guys.

You're in Montgomery?

No.

Are they paying market rent?

How is this working?

Well, we just started, obviously.

My youngest had to move out.

They had been roommates in our house.

We had to find the youngest a place to live.

So they've been covering.

We took

a small mortgage out on it and had just been paying it off because the short term of it was we're going to pay this.

You know, it's going to be selling before the 15 years would be up anyway.

So

but we've been paying extra payments on it just because that's what we do.

We don't have any other debt.

And

so we thought, and I just want to bounce this off of somebody for some help, that we would have them pay rent that just kind of covers the basics of the mortgage and all of that for a few years so they can save up a down payment.

And then they can buy the house

on their time.

And we'll give them, you know, the excessive family discount, of course, on the house.

So yeah, my investment that was going to pay for my vacation house is no longer.

I would recommend a different thing.

Okay.

I would recommend not planning two or three years ahead with them.

And here's why.

The mobility of young people, especially young married couples, and the way the job markets are right now, they're just kind of a mess.

And so what I would hate is two years down the road, your son gets a huge,

a huge raise and they don't want to live in a tiny little house in a tiny little college town.

They want to move across town or she gets pregnant or she doesn't want to work.

So I think you might have that in your mind, but I wouldn't put that on the table right now.

I would say we're going to sign a lease and I know this is uncomfortable, but I want you to teach them and keep everything clean relationally between y'all.

We're going to sign a year lease together.

Here's what your rent's going to be.

And you can wink at them and say, we're going to hook y'all up.

And we hope y'all will save for down payment and look at the blessing that this is.

And y'all make the rent as low as you want.

Like whatever.

Who cares?

And then if they want to stay there the next year, cool.

And then tell your son, if y'all ever want to buy this, it's your job to call us.

Because I don't want there to be.

That was their idea.

I know it is right now.

But it might not be in two or three years.

Right.

Which is still not going to hurt us because then we sell it at value.

No, no, y'all, financially y'all are going to be fine.

I'm not worried about that.

I'm worried about the relationship stuff, about him having a young wife that kind of doesn't want to live there anymore, but they already promised mom and they've been hooking us up and now we have to do this.

Oh, I see.

So let them off the hook.

I got you.

So it's you saying, y'all want to buy this house someday?

Great.

We're going to take this year by year.

Because you don't, you and your husband don't have to have this to survive.

You're in a position to help them out and But man, I'm I care way less about the money on this I care way more about the relationship part on this

Absolutely.

Yeah, it's vital to us.

That's why this is like our wedding gift to them

Amazing amazing a huge

but but you when you sit down and sign this lease and tell you and your husband tell them if in two years something else comes up y'all get one of y'all wants to take a job somewhere across the country or y'all want to move to a different neighborhood like

y'all we're always gonna be in your corner We don't ever want this house or this lease to come between us.

Right.

But

that's be my recommendation not to make a plan now that's two or three years out with a brand new young married couple that just graduated college.

The world's too fluid right now.

Sure.

Now, there are some financial implications you need to think about if this does happen.

Number one is capital gains for you guys because it's a rental property and not a primary residence.

So you will owe some capital gains.

Yeah, and you'll also have a loss of the step-up and basis for the kids.

So that's one reason we always say, hey, let your kids inherit the home after you pass, but don't give it to them while you're alive, because you lose that step-up and basis.

Right.

So, whatever the house was, you know, worth, there could be some huge tax costs down the road for the kids.

Then there's also gift tax issues.

If you sell it below market value, that would be considered a gift in the IRS's eyes.

Just the gap between what it was worth.

Yeah, so if it's worth $500,000, you sell it to them for $300,000 because you said, I want to just be nice.

Well, that $200,000 discount is considered a gift, and that's above the IRS's gift tax exemption.

So there's a lot.

There's things to think about.

There's better ways to gift your kids a bunch of money is what I'm saying, if that's what you're trying to do.

And to John's point, there's so many other things here.

That's like, would they actually want this house?

If it didn't exist, would they just go up and buy this house?

Probably not.

So if you want to just gift them a down payment, you can gift them, you know, 18 grand per year per person, and that could add up pretty quickly if you wanted to to do that.

And then they can go use that money to do whatever they want with.

That would be better from a like tax perspective if you're trying to be smart about it.

So I would get with a Smart Vestor Pro.

You can reach out to one at ramseysolutions.com and they can help you navigate the right way to do this so that you don't have any regrets later of going, we had the right motive, we had the right heart, but it ended up being more of a headache than it was worth.

And it was bad for both parties.

So George, I'm going to ask a question to George on your behalf, okay, Cassie.

So let's say these kids move out and they sell the house and there's a couple of college kids that they like and they're just gonna sell it to them and they bought the house for 200 the house appraised at 250 they're gonna sell it for what they owe 180 right if they sold it for 180 even to people not their kids do they still have that gap because i thought that wouldn't sell my house as much as i want as cheap as i want if i would sell my house you don't think that would be considered a gift in the irs's eyes okay because it was that that gap is not to benefit you know your kids

so the fact that it's their kids is going to add into it i think so i think your your family would play play a role in how the IRS sees these gifts happening.

And so I would definitely, you know, cross your T's, dot your I's on this, Cassie, to make sure that you're doing it the right way and that there's not a bunch of zeros at the end that you guys go, oh, my goodness, we did not think through this.

We just thought we were doing a nice thing.

How much is this house worth?

It's worth about $285.

Okay.

We bought it for $150.

Oh, wow.

Okay.

So it's appreciated.

Right.

Yeah.

Yeah.

And then would, we had talked about selling it to them for $220.

Okay.

I would check with a tax person.

That doesn't sound out of bounds to me.

Okay.

That doesn't sound bonking.

Because I figured out what their payment would be and, you know, that that would be kind of easy for them to do and it wouldn't be a burden.

Okay.

And then they'll have to qualify for the mortgage on their own.

Right.

And she just started her job, so she needs a couple of years

to get their feet under her.

Yeah, I just didn't want you to prop them up artificially and then real life hits and they go, oh my my goodness, this was a nice gift, but we can't even afford to maintain the gift.

Yeah, I like the idea of them signing a one-year lease or a six-month lease, and y'all being so open-handed with we love y'all, this is supposed to be a blessing for y'all, and our relationship's always going to come over.

And then y'all do your homework on the tax stuff.

Best of luck, you've got a great hardcast, it's awesome.

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Elena is in Mississippi up next.

What's going on, Elena?

Hi.

Thank y'all for having me.

We are wondering kind of what to do with our car situation.

Me and my husband recently got married in July.

We've got two older cars, and I would love to buy another fun project car.

We're trying to figure out if that would be the right move for us or not.

By project car, do you mean something that like a clunker that you fix up and then sell?

I would like to buy something to fix up and keep, but he would like to buy something to fix up and sell.

So you want a hobby, he wants a business.

He's got his he already has a hobby.

I would like a hobby as well, and he wants a business.

And you both can turn around.

Yes.

That's fun.

Okay, what's this project car going to cost you?

Well, the ones we've been looking at range from about $15 to $900 to buy and then about $15,000 to $2,000 in parts.

Okay, so

let's call it $2,000 to get it and two grand to fix it.

So $4,000 all in.

What kind of car do you want to get?

It's a Hyundai Genesis and Via 2.0 turbo.

Are you going to drop it real low and put lights on it and listen to like

music?

No,

he's got a 3.8 uh v6 and we've absolutely loved it and we rebuilt the motor and it it blew up about two years ago now um

so it it has definitely been a lot of work but it has been so much fun for the both of us and i absolutely love the car and i'm my favorite car i've had in weeks so rock and roll good crazy they don't make them like you anymore elena my wife wants to make sourdough bread and you want to fix car engines my car my car runs on double-a batteries and zay's out here talking v8s and i have to push it when it runs out okay so do you have $4,000?

Yes.

We have been very fortunate.

We have a paid-off house.

We are completely debt-free.

The cars that we do have are paid off.

And we've got a very good emergency fund saved up.

And we've got a good bit in cash to do this as well.

So, how much cash do you have outside of the emergency fund?

Just this is fun money that we've saved up.

We've probably got about $6,000.

Awesome.

And so, what's the rub here?

Does your husband not want you to do this project, car?

We're getting to the point that he drives the service truck every day, so his car is not going to work and back.

My car does go to work and back, and it is getting higher on mileage.

It's a 2006 Forerunner.

It's got 250,000 miles on it.

So if

you guys need better cars.

No, they don't.

These guys are awesome, George.

But is he like, well, we need better cars for ourselves before you go working on a fun little project?

Is that his mentality?

He really wants us to save up for a truck because we are in need.

We do borrow my dad's maybe two or three times a month.

Just the things we do and where we live, it would be more beneficial for us to have a truck, a reliable truck, more

than another fun car.

If you sold the service truck or would you not sell it?

Would you keep the two older cars?

We would have to keep the two older cars.

The service truck comes with his job that he's at.

So we pay nothing on the service truck so it sounds to me like you and i the way i almost said this sounded awful but you know i'm saying it with a smile on my face you're the one with the thing here right

because he doesn't drive his thing but i want to keep the thing he doesn't but but you don't this isn't about a car like because you have a cool fun car that's actually faster and more powerful than the one you want to fix up and he's saying just drive that one because i don't even drive that one to work you're saying

i want another project to do with you yes okay I think you need to have that conversation.

Okay.

Because he's looking at this like, we have enough cars, we have too many cars, we actually have a need, which is a truck.

And you're saying, I want to spend time doing a thing with you.

Yes.

And I don't know many husbands that would not just like smile from ear to ear for days if their wife said, you know what?

I just.

We don't need any more deer.

I just want to hunt with you all the time.

John dreams of that conversation.

I know.

Or

I just want to go, I want us to dance all the time.

Like, you know what I mean?

Like, that's an amazing, but that sounds like the real conversation.

Tell me if I'm wrong.

I may be off base here.

That is a conversation we need to have, but we're also to the point that both cars have issues, and he's worried about us not having a reliable car.

And I think that's fair.

The company's very strict on the service trucks, and they are just working back, and that's it.

How much can you guys save per month towards like a car fund?

Right now, not much.

We just have been fortunate to pay our house off, so we're still trying to figure everything else out of that.

That's what I was thinking.

You guys are debt-free with an emergency fund.

You should have the most margin you've ever had.

Are you guys not making enough?

We take home about five grand every month.

And your expenses are how much to cover all of your utilities, insurance, food?

They run about 12 between insurance and

we do have a, I have some medical bills that have to be covered every month.

Okay.

But you're talking three months, y'all could have 12 grand plus the six you have.

And with your wrench turning capabilities, y'all could get a rad

70, 80, or 90s F-150 and make it pretty cool, right?

Yes, he really would like a Dodge Ram, and I like them too.

Well, that's embarrassing.

You can do that.

what is the truck that he wants?

What does that cost?

The ones we've been looking at are $12,000 to $16,000.

Okay.

So how about this?

I think we can compromise and go, let's eat our vegetables before we eat dessert.

Let's get this better truck.

And so we can save up $16,000.

We get the truck.

Then once we have the money on top of that, the extra four grand, then we get the fun project car.

And you can cash flow that.

You can get it for $15,000.

You're talking three months.

You're talking for Christmas, y'all get this truck.

You already have six saved.

You just need to save $10,000 grand more.

Yeah.

So put away 3,300 bucks in a savings account, cover the rest of your bills with whatever's left over, and you've got this money by Christmas.

Yeah, I hadn't thought about it like that.

I would put it on paper to help him visualize it and go, you know what?

I've had a change of heart.

I talked to those Ramsey show guys.

We're going to get to that truck.

Well, nerdy, they were right.

Because then the next month, come January, you've got an extra $1,500 to go get your project car.

And the next month, you have the money to fix it up.

Yeah.

So all of this is going to happen by Valentine's Day.

He's smiling at me through the window.

He's listening to the show.

Okay, tell him he is not allowed to say the words, I told you so, or all of this advice goes out the window and you go get your car.

Okay.

He's not allowed to say I told you so.

And I do think that...

I think he took that too well, but I do think that y'all need to consider selling one.

You don't need five cars in the car.

Yeah,

y'all are getting Beverly Hill Billies real quick.

Y'all don't need that many cars, but if you got some older cars, I think you find one, whether it's the, you can get some good money for that 4Runner or the other, the other, his little toy car that he doesn't get to drive very much.

I'd sell one of those, if not both of them, and get this truck because y'all can get that thing knocked out so fast.

But man, George, they're awesome.

Yeah, I'm like, can you guys come fix up our cars and Nashville?

Not yours.

I'm sure that you have to hug it out.

You have to have a stint at the Apple store to fix up your car.

I just hit software update, and then it fixed it.

We're good now.

Yeah, they use cars with like oil and stuff.

I bet they know their way around a clutch pack piston.

Tell you that much.

I don't even know the words you just said.

Google it.

Hey, George Camill here.

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And again, that hub is completely free and packed with great tools.

Susan is in New Jersey up next.

Susan, welcome to the Ramsey Show.

Thank you.

Thank you for having me.

I'm hoping you can help me.

We hope so too.

Let it rip.

What's up?

No promises.

Okay.

So my husband was a six-figure income earner.

And a year ago, August, he lost his job supporting the VA in government when the contract he was on did not renew.

So he is in his late 60s.

I'm in my early 60s.

I take care of my mom full-time with dementia.

He had been continuing to search for employment.

And of course, the way of the world, nothing's panning out.

So he had been flipping home in his fringe hours for about a decade and always being successful.

The last home that he did

didn't go so well.

The one that he decided to take on because he couldn't get government work, he is run into some situations with a contractor, and we are not going to realize the ROI that we had intended.

So, my question is:

I do have a 401k,

and we do have a rental property that

our home was paid off, by the way.

We were debt-free.

We've been Ramsey followers.

We were debt-free for quite a number of years.

So we have this rental property that would return a decent ROI

through the peak season, especially.

And typically we have extended stays in the wintertime, too.

Right now,

we're still waiting for something to materialize.

The equity that we have in that is about the same amount that I have in my 401k.

So when we sat down and looked at, you know, what our expenses are for the home that we live in right now, and our taxes are insane.

So the home that we live in now, the rental property that we have, and then of course, when he sells,

The house that he's working on is going to be listed within the next two weeks.

So we're hoping for a quick turnaround.

But as you know, you never know.

So that's really the essence of my question

is do I go to my

401 to survive on

or do I borrow against my so do I borrow against my 401

or do we liquidate the rental property and take the equity out of that,

even though that's been an income earner for us during the year, which has been a huge blessing, especially with the fact that, you know, I'm caring for my mom and it's very, very difficult.

I've always had a side hustle.

I've always worked until mom's illness really took over.

So

there's my story.

Yeah.

Well, so far from what you've told me, option C is the most appealing.

I don't like you robbing the entire 401k, even though you could do so without penalty at your age.

You're still going to, you know, there's going to be some tax implications.

I hate the idea of you borrowing from your 401k at this stage.

And selling the rental property to get some financial footing sounds like the most reasonable common sense option right now.

So, how much could you sell the rental property for?

Sorry.

You're okay.

You're okay.

We think we could get in the upper fives.

Okay.

And you owe how much?

Fully furnished.

We owe $329.

So, could you net like $150 from this?

Yes.

And use that money to kind of figure life out, figure out next steps?

Yeah.

Because my bigger concern is, how would you guys survive in retirement if he's unable to work in the future?

What was the game plan?

You know,

that's really a good question.

And then there was another snafu, if you will, thrown in there where

He's had some medical issues.

We thought he was going to need another open heart surgery this past spring, and then God graced us with, nope, that wasn't the case.

But now he does have some

issues.

So that's the reason for the home that he's

currently working on and having to, you know, subcontract, if you will.

Yeah.

I think this is a time to simplify.

Would you not agree to just get well, both of you, and have some financial cushion?

How much is in the total nest egg for retirement investments?

Well, that's a really good question.

I'm thinking so, my 401,

and then our home is paid off.

Does he have any money in retirement at all?

Well, I just learned that no.

Okay.

And here's my.

Because he was trying to survive.

I know.

We're not here to cast black.

We're not casting blame.

We're looking to see all the puzzle pieces here to help you navigate this.

One of the most important things when life blows up is us to get real information, right?

So we can get a firm footing.

I'm going to ask some questions.

I'm going to ask some hard questions, okay?

Do you have any other siblings that can help support your mom right now?

No.

Okay.

So you are completely on your own with her?

You're completely on your own in this situation?

I am.

Okay.

Does she have Medicaid?

Does she have opportunity?

And does anybody want that?

No.

But here's what I'm scared about.

I'm scared you're going to sell this house.

You're going to actually reduce your monthly burden quite a bit because you'll have to make that house payment, whether anybody stays there or not, on that $500,000 mortgage.

And so you're going to clear that from your day-to-day pressure and you're going to get $150,000 cash infusion.

That's cool.

But y'all don't have another plan after that, right?

So

we're hoping.

I mean, he's not afraid to work.

He loved, he adored his job.

And I know, I know, but listen, listen,

I'm saying this with all due love.

That job,

that identity that comes with saying, I earn six figures, it is over.

Oh, yes, we know that.

We know that.

And his ability physically to do any job could be limited as well.

Right.

So we're just looking at reality.

I'd rather him go get a job at Home Depot.

and make 45 grand.

I'm serious.

Because five figures.

And

I didn't mean to laugh.

Because we have talked about that.

Five figures, because a guy with his wisdom and a guy with his experience could go in there and start and then he'd be an assistant manager in six months.

But making 45 grand is making five figures is better than making zero figures.

And that's not, that's not casting any sort of anything other than y'all have a math problem.

Right?

And that's scary.

And you throw in mom, you throw in his health.

Like you're, you're barely hanging on.

And so there's something about we got to go like just choose reality.

We've got to deal in reality.

This house that you tried to do,

that season of our life, that's got to appear at the end of that sentence too.

The next right thing is Home Depot in the morning and Lowe's in the evening.

And he's got to, you're talking about an almost 70-year-old man with a heart challenge.

I get that, right?

I totally get that.

And y'all have a math problem.

It's a scary place to be.

And y'all have to have some really come to Jesus hard conversations about not do we want to, not do we wish we could, but do we have the money to continue to house and support mom?

Or do we have to put her in a facility where we can support her, where Medicaid can take over?

Yeah, so she's at home.

So we do,

there's three of us that are, I have two other caregivers and myself.

Okay.

And that was the other thing is that he was helping to assist with her care until he said, I really feel like I could write the ship ship if I just do one more house.

And so I said,

okay.

But

we had some very unfortunate situations with the contractor, which I won't get into.

Well,

it doesn't matter.

It's all a distraction.

It's all a distraction.

He went for it.

He went for it.

Yes.

And it didn't work.

And so let's put a period at the end of that sentence.

And I'm going to high-five him for going out there and scrapping and clawing and trying to make it happen.

But we got to get some money in the house.

And I hate that y'all are in this situation.

George, do you think the right thing is to sell that rental house?

I would sell this rental property.

It's the last thing you need right now in your life, is to also be a landlord and have this debt in your life.

And so I'd clear the decks.

I'd have that money in the bank.

You can put it in a high-yield savings account for now to help you guys float by.

I mean, the interest it creates will at least cover a few bills right now.

And then see if you can get paid to be a caregiver.

It doesn't sound like you're doing that right now.

I would look at your state programs that you have, the Medicaid waivers, and see if you can at least make an hourly wage for taking care of your mom.

That might be an opportunity as well.

Husband's got to go get a job.

Hey, you guys, Rachel Cruz here.

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Are you staying on track with the baby steps?

Well, we've got a quick quiz that'll help you check your progress and you'll get a personalized plan made just for you.

So simply head to the show notes, click on the link titled, Are You On Track with the Baby Steps?

And complete the quiz.

James is in Charlotte, North Carolina, up next.

James, welcome to the show.

Hey, guys, very appreciative of your time.

So thank you.

Absolutely.

How can John and I help?

So long story short, I've been following you guys

for a few years now.

And I feel like I blinked.

And

I'm making a, I can't believe I'm making this call, but we're planning on paying off our house in December.

Yeah, dude.

Congratulations.

Fantastic.

How old are you?

35.

Oh, my goodness.

Me and my wife, 35, and then we have a three-year-old daughter.

Amazing.

What's the house worth?

A little north of $600.

Awesome.

Are you guys baby steps millionaires or on the cusp?

So

that's actually part of my question.

So

we, you know, most of our

net worth is going to be in the house.

And now we're kind of accelerating with investments and retirement and everything that goes into that.

And I guess my question is, what exactly is next?

We will not have any debt whatsoever once the house is paid off in December.

Awesome.

So you're feeling lost because you're a guy who, like, you have the goal and you check the box and they're, okay, now what?

Kind of.

Yeah, I feel like

we just beat the video game and now what's next?

You got baby step eight.

Give back to John.

You can Venmo him.

Yeah, now you don't have to play video games anymore.

That's the cool part.

I love it, man.

Yeah.

So now you, by December, you'll be at baby step seven, build wealth and give.

And this is where you just increase every area.

So you're able to give more.

You're able to invest more beyond that 15% parameter.

You're able to spend more.

And so then it becomes you and your wife sitting down to kind of dream again to go, okay, what do we want the next five years to look like, 10 years to look like?

What about legacy?

legacy do we want to upgrade in house because here's the good news you woke up the same guy the day after you pay off your mortgage i assume you're a good-looking guy james

hey you know what they they don't call me humble for nothing so uh there we go uh

i woke up looking just like i did and so that was very frustrating i thought man i'm in baby seventh seven i'm a new man and then i still gotta you know just do all the things that you gotta do.

Eyebrows, the whole thing.

So that's the good news and the bad news.

The good news is you have more margin than ever to spend more, save more, and give more.

The bad news is you still got the same problems.

You still got to do the car repair and upgrade and save for college.

And so it's going to be oddly anticlimactic.

And so the fun part is getting to dream again because you've been so focused on this goal clearly.

A young guy paying off his house this early.

You guys were intense about this, weren't you?

Yeah, we were for quite some time.

So

James feels really good to get here.

Here's the question that in a different context saved my marriage, but it has informed the way me and my wife make decisions.

She asked me, how do you want this house to feel when you walk in every day?

And

it wasn't a fun conversation we were having.

And I immediately said, I want this house to feel full of laughter and warmth.

And

I want you to be happy that I'm home.

And that conversation led to a whole bunch of other actions for both of us so that we could have that kind of house.

And there's something amazing about you and your wife.

You know what would be cool?

You, you get the babysitter and plan a half day with your wife for the day after you hit send on this thing.

And y'all go out and you can symbolically clear the deck and say, nobody can take our house away from us.

We're essentially millionaires and we're 35.

Statistically, we're not even halfway home yet.

And we get to decide how we want our home and our lives to feel moving forward.

And y'all can put on the table, you know what?

We want to be able to give our kid a house when she gets married.

We want to be able to make sure she has no college debt, but we want her to go to college.

We want to have new cars.

We want to be able to give a million dollars by the time we're 45.

Whatever that is, y'all set those things together.

Like, basically, y'all aren't playing the video game anymore.

Now, y'all are writing and creating your own video game.

And then y'all just reverse engineer what must be true for those things to happen.

It's kind of the coolest thing ever.

Yeah.

No, it sounds amazing.

Like, listen, like you had mentioned for my wife, like, she definitely deserves it.

You know, she's made so many sacrifices over the years to get this done.

So, um, so where does she want to go?

Is there a trip?

Yeah,

so, yeah.

So, you know, we've been, we've been talking about things like that for 2026.

So where, you know, where does she want to go?

Well, specifically, if we're talking in-country, you know, Lake Tahoe has always been like a dream spot for her.

Okay, book it.

Book it.

Yeah.

Book it.

Get the suite.

All right, don't cheap out.

Upgrade.

Get the big room.

And yes,

get the spa day every day of the time, like a spa treatment every time you like.

Do that.

Upgrade the rental car.

Yeah, yes, yeah.

No more Ford focus.

We're not going to be driving up in a centra.

Exactly.

Hello, Tahoe.

Right?

But it's you.

This is going to sound crazy.

I want you to start practicing

giving money in crazy ways.

Y'all start practicing tipping obnoxiously together.

I want y'all to practice putting a vacation on the calendar that y'all are going to go to.

You're going to practice.

It's going to feel weird because

y'all have been fight or flight for so long.

Yeah.

Yeah.

No, absolutely.

No, this all sounds amazing.

So, again, really appreciate your guys' time.

I'll say you congratulations, brother.

Yeah, way to go.

I love the story.

Thank you so much.

Thanks again.

James is a stud.

Love talking to him.

What's the thing you did after you paid off your house?

Upgrade car.

That was the carrot I dangled for both of us for my

thing in the next one.

In 2012?

Yeah, it was.

I mean, it was a nice, it was a Tesla.

It was a 2013.

That's what I upgraded from.

From an upgrade?

From an 09 Civic with the bumper hanging off.

So that's my key life hack is like never go way too much because then you got to up that next time.

So now my next car just needs to be nicer than a 2013.

So, I did get a lot of respect for you when you upgraded cars when I saw the one you bought yourself versus the one you bought Whitney.

Yes,

she deserves it.

It's a good man.

So, that was, yeah, that was a great example for James.

I'm like, it's probably time to upgrade the cars to something that scares you a little bit, but you're going to walk in and write a check and be done with it, but it's still going to be the most money you've ever spent on a car.

Yeah.

That's the part that's kind of interesting as you get past baby step seven.

Every next thing you do is the most you've spent on that thing, and then you just go, oh, okay, that's over.

Or go call your

minister at your church and go have coffee and say, hey, two or three families are going to come in during Christmas and they're going to be struggling.

I want you to

just answer, we got you, and then you let me know.

And we'll take care of that.

And it's going to, we've never written a $3,000 check to somebody we don't know.

We're going to start doing this.

Those are my favorite.

You get like the old lady who, the lights got shut off and you go, we're going to cover her light bill for a year.

Or if you find out your neighbor, like we had at a previous segment that um

a she's a military um member of the military your husband's military they are going to work every day and because of the stupid government shutdown they don't get any food and they're worried about groceries they're worried about rent they're worried about uh daycare you can just be like i got that that's done I love those.

And the things that like bring tears to your eyes, like you're, you know, you hear about the adoption story.

And if that brings tears to your eyes, put money behind it.

That's it.

I think that's a good life principle.

If you find yourself crying during a commercial in a sports game, just put a star by that and find a place in your local community to get involved with that one.

Dude, I'll cry at a Charmin commercial.

It doesn't take much for me.

Well, then you can start with a lot of people.

I've invested a lot of money in Charmin.

Sure.

Those are fun.

Yeah, I just jotted down some things for James.

If he's still listening out there, a college fund.

Like, I would just put $10,000 in a 529 just because we can.

And that way, that money's all going to grow tax-free for college from age three to 18.

Boom.

That's done.

Retirement, let's max it out.

Let's max out a 401k, max out the IRA, maybe do a backdoor Roth IRA if we make too much money.

Vacation fund, we got to put in a thousand bucks every month to get to 12 grand for that trip a year from now.

A car fund, that car is going to be 40 grand.

We're going to pay cash, so we got to put away three grand for the next, you know, 13 months.

So the house fund, we want to upgrade in cash one day.

All right, that's going to be an extra 400 grand on top of ours.

That's going to take five years to save up, 10 years.

So I like having all those, set them in motion, and then don't think about them.

Like put it on autopilot and don't let this consume you.

Because I'm a goal guy like James.

And so it took me a long time to just let go.

I'm a feelings guy.

What do I feel like doing next?

Let's go do that.

John is all feelings.

I'm all logic.

And together, we create one human being.

Our scripture of the day, 1 Corinthians 15, 33.

Do not be deceived, bad company ruins good morals.

Jordan Peterson said, you are not obligated to associate with people who are making your life worse.

That's good advice.

Michelle is up next in Philadelphia, Pennsylvania.

What's going on, Michelle?

Hi.

Thank you so much for taking my call.

Thanks for coming.

What's up?

Oh,

I'll tell you what, I've been following you guys for about a year and planned to make this call, although I thought it was going to be a very different phone call.

So

my husband and I,

you know, we started a business, opened our doors five weeks before COVID, and

pretty much we're in survival mode these past seven years.

And

after digging a bigger and bigger and bigger hole,

we finally decided it was time to call it quits,

get regular jobs, and move forward.

And I started working first,

got us stable because we weren't even stable paying monthly bills.

And he

got a job next.

He had worked one week and

had a massive heart attack and passed away.

Oh, no.

So sorry.

What was his name, Michelle?

Mel.

Mel?

Pretty awesome guy.

Yeah, we've got quite a a story.

How long were y'all married?

It was nine years

on the 9th, and he passed away on the 3rd of September.

Of September, so this is really fresh, huh?

Oh, yeah.

Oh, man.

I'm so sorry.

So,

you know,

part of

Part of the struggle is that I just shut down.

Of course.

I'm looking at everything that we need to take care of.

And it's kind of a

mix of debt.

There's tax issues.

There's

some student loan debt,

some other debt.

And unfortunately, everything is kind of coming to a head.

The job that he was getting would have essentially doubled our income.

He was going to make about the same amount as me.

And, you know, we had a plan.

You know, I was working on our budget and I was actually planning to call you guys and say, okay, this is what we got.

This is what we're working with.

Where do we start?

But now it's just me.

Yeah.

And I don't even know where to start.

Well, first here is hear me say, like, we're heartbroken with you.

You're just a little over 30 days.

And so this is

there's a chance you don't remember this phone call, is what I want to say.

And, but I want you to remember that we loved you, and we gave you some next right steps, okay?

Okay.

Um, do you have any kids?

Do you have any support in that way?

Um, my daughter lives close by.

Okay,

um,

what we're looking for here is you're right.

You've got bills, you've got

debts, you've got creditors.

There's probably stuff you don't know about related to the business.

There's just stuff feels like it's piling up on you.

Just know you're 30 days out.

The only things in the world that matter right this second are your four walls.

Do I have a place to live?

Do I have heat and air?

Do I have water?

And do I have food and transportation?

Okay.

And other people can knock on your door, they can send you letters, and I'm not going to open them right now.

And some of that, I've I've been in homes with women in your exact situation that know right now this house is too much and I'm going to have to find a place to live.

If that's your situation, then we'll take that route.

If you're okay with your house right now, you can afford on your salary to make payments right now, then we can exhale a little bit on that one.

And we're literally going to get somebody to sit with us.

And in your case, maybe your daughter, maybe a girlfriend, maybe somebody at work, somebody to sit with you and just simply walk through the bare basics.

Okay.

Is there any kind of will or life insurance of any kind?

No.

So

my husband

was actually rebuilding his life.

We're both in recovery.

God willing in November, I'll have 36 years sober.

Congratulations.

Thank you.

And he,

at the time of his passing, he had about seven years clean.

He was a heroin addict, and that was part of our business.

We started the business

with the idea of hiring people in recovery and helping them rebuild.

And that was also part of his journey.

So at any rate, I already owned my house.

So everything was in my name.

So it's not complicated that way because he had nothing.

Can you afford to stay in the house with the money you make?

Depending on how everything else falls, yes.

Okay.

In theory.

Are you back to work?

I am.

I am.

Okay.

What are you making?

About $75

a year.

Good, good.

So you've got enough to cover all the basic bills right now.

You can cover your four walls.

Is there enough left over to make your minimum debt payments?

Well,

that's to be determined

as people are coming with things that are past due and trying to set up payment plans.

I'm trying to figure out what kind of payment plans I can set up.

I wouldn't do any of that right now.

I would get everything in order, pull credit reports for you and for him, and get a sense of

what's happening.

Okay.

Okay.

The other thing is there's things like if he had student loans, then

they may be relinquished since he passed.

If y'all consolidated them, you may be on the hook for it.

So it's figuring out each one of these bills as they come in.

But I don't want to start making payment plans over here and signing up with this one and calling this credit.

It's going to feel like too much.

I want you to have at least 60 days where you can exhale.

And

you're going to need to go,

this is like the hard brass tax part of this, okay?

You're going to need to get about 15 or 20 death certificates.

And people are going to want to see it.

You're going to email it.

It's going to feel like an out-of-body experience dealing with the business side of someone you love passing away.

And people are going to be mean.

They're going to think you're pulling a scam on them.

And I would let that roll off my shoulders.

And I'm going to go do the next right thing.

Okay.

But I want you to know what size elephant you have to eat here.

Is it $150,000 in debt you owe everybody else?

Is it $25,000?

Like, how big is this thing?

And then that's going to help us make the plan.

Great.

How big of just the napkin math you've done, how big is this?

How much money do you owe other people right now?

Including the house?

No, ma'am.

Not including the house.

Probably

about 120.

Okay.

And how much of that is his student loans?

He didn't have any.

The student loan is me.

It's actually a parent loan for my daughter's school.

Okay.

Is she still in school or is she out and working?

No, she's out and working and paying on her own loans.

So I took out a portion as a parent loan

to help cover

what she couldn't on her own.

Okay.

And if the number truly is

120, 150, and you make 75 plus your house payment, you may be in a situation where you're going to have to to sell your house

and we're going to have to clear this debt and we're going to have to downsize.

We're going to have to live with daughter for six months.

We're going to have to get a one-bedroom apartment.

We're going to have to do some pretty radical things because a radical thing just happened to us.

But here's the thing.

I don't want you doing the next step on your own.

I want you to have somebody with you, okay?

Yeah.

I don't even know where to start.

We've got you.

We're going to hook you up with a financial coach, Michelle.

You're not going to pay for it.

It's on us.

And along with that, we're going to give you our Every Dollar Budgeting Aremium version.

And that financial coach on our team is going to walk you through all of this, lay it all out for you to give you the lay around and help you take those next steps.

Because I know right now, I mean, you're a month in.

You can't see the forest from the trees.

Everything's cloudy.

So nobody expects you to have it all figured out.

What you're calling us.

Yeah, go on the line in your sister.

Oh, hang on a line, Michelle.

Christian's going to pick up.

We'll get you connected to set up that financial coaching call.