What’s My Next Right Step With Money?
2024-01-22 01:55:20
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Live from the headquarters of Ramsey solutions. It's the Ramsey show where we help people build wealth, Do work that they love and create actual, amazing relationships. I'm Dave Ramsey, your host. Thank you for joining us. Dr.
John Deloney, Number one best-selling author and host of the dr. John Deloney podcast on the Ramsey Networks, is my co-host today. We're happy to talk to you about your life, your money, your relationships. We're here To help you do life a little bit better. The phone number is triple 8, 8, 2, 5, 5, 2, 2, 5.
Taylor starts this hour in Knoxville. Hi Taylor. How are you?
Hey, Dave. Hey, dr. John. Thank you so much for taking my call. Sure.
What's up? So I need some help navigating money and family. my question is is it wrong for my husband and I to lie about our accomplishments and Pretend to be broke in order to financially and emotionally protect ourselves, and I'm happy to give a little context with that.
It's just cowardly.
Yeah, yeah.
Yeah,
How old are you guys? how long y'all been married, Taylor?
So we've been married a little over a year together for five. I am 32 and my husband is 35.
So who's the twerp? that's gonna have a hard time with you succeeding?
It's my family, Specifically my mom. So my, my husband and I have paid off over a hundred thousand dollars in student loans.
Over the last three years and your mom will feel entitled to some of your money if she hears you're winning.
Correct, okay, correct.
Almost like I've talked about this before. Okay. Uh-huh. Uh-huh.
And uh, so she uses money to show love, but more as a means of control. And yeah, anytime one of her kids starts making money, She's got her hand out wanting some. and to clarify, she is financially well off and is not in need of any help. And she has actually stolen thousands of dollars from me in the past, when I had my very first job when I was 16 years old and when I.
Pretty much saying mom's got issues.
Yes, why do you continue to allow your mom to control you? You're 30.
Yeah, I Want to honor her as my mom.
I don't think that's true. I don't think that's true. I think that sounds good. It's a good church answer. Yeah, I think you're still trying to figure out what you did wrong when you were nine, that your mom would steal from you.
and You still think there's a way. There's a thing you haven't done yet that she'll find, you'll finally do it. You'll finally give her the amount of money, You'll finally do the thing and she'll go. I'm so proud of you. I love you.
That's what I think you're chasing. I think you wrap it up in words like honor thy father and mother. honor thy father and mother Does not mean.
Honor their misbehavior exactly.
Yeah, and I'll. honestly, I would love to just cut her off completely. I don't think I'm ready to do that. I think that's what makes it hard. Here's what you're giving her right now.
You've given her money in the past. you've given her your Life in the past. now, you're giving her your integrity. Free rent in your head. Don't give her your integrity anymore.
Tell the truth. Yeah, and what she says? Well, I want like. no, We're on a budget. It's a muscle.
You're gonna have to practice. Yeah, you're gonna have to, you're gonna have to. It's like going to the gym. You just never done squats before you have to start light.
But you're gonna have to learn how to squat. first time you do it, your heart rates gonna go and your stomach's gonna go Into your throat. the 80th time you do it, You're just gonna be smiling, looking at a poor, pitiful lady who hasn't been able to control her own emotions.
Yeah, because that's actually what she is. It's just kind of pitiful. You will never do a thing that makes her finally say
Because she doesn't have that. She don't have that too on her kid. No, you can't do it. She doesn't know how. So you're dealing with an incomplete person who's got major, major gaps, and You cannot have any expectation that she's going to be anything other than that, and you just smile and go.
no, I Mean pretend like she had had a stroke.
Okay, and she was in and she was incapable of.
Behaving, you would just look at her and smile go gosh, That's a horrible malady you've got. but that still doesn't mean you get to come over here, and you know, Throw rocks through my window.
Yeah, and
We you didn't hear, you don't want to so bad, why I just kept driving? why?
Okay, okay, I'm gonna cut to it. you're scared, you're gonna haunt your marriage? Yeah, and at some point your husband, if he hasn't already, he's gonna ask why her over me, Mm-hmm. Why her over our future that we're trying to build together. She's taking up a lot of space in your head.
So this may be you guys, you may need to sit down, talk to somebody and work this through, Because this is a mother-daughter dysfunction. That's pretty, pretty serious. And it's just, it's just manifesting itself in the money. But it's, there's a lot of others, parts of this and so. but the truth is, you're not gonna have peace.
hiding as a 30-year-old, hiding Like you're some kind of misbehaving teenager. You know, I can't tell my mom, I got good grades, You know, I think, come on what. so because she, she does not have the capacity, She's a diminished capacity, as if she's had a stroke. We'll just call it that. Okay, and it affected her ability to be a good mom.
And so you just treat her like that, and it's kind of sad and it's kind of pitiful. and but it doesn't mean I can't Tell her the truth, mom, you know, if it comes up, but you don't need to go in there and go, that, that, that, that, that, That, that, look what we did, because that's not gonna do it either. But you, just if it comes up, you just go. well, you know, hey, we, yeah, we paid off some money. But I don't tell, I don't sit down with Anybody and go, look at what I did.
Yeah. How does that even come up in your house? Yeah, really?
Well, when, whenever me and my husband go which is less and less frequently now, If I need to go to the restroom or leave the room, They will corner my husband and straight-up say how much money did you make this year? What are you making now?
But all you say is I had a good year. I don't. I'm not gonna give you those numbers and you smile real big.
Yeah, I don't. I'm gonna tell you that it's none of your business.
Yeah, or when you come out of the bathroom, go. Hey, mom dad. We don't talk about our private financial matters anymore, We just don't. we don't put those numbers out into the world. Those are private.
Those are ours, And if they can't honor that boundary, then they're asking you. Well, we don't want you here.
Yeah, right.
That could be the exit that I'm looking for. No, it could be, but that would be them running you off, not you yelling.
I'm leaving until you learn to behave.
That's not what we're telling you. Okay. I don't want, I don't want, I don't want, I don't want I.
Don't want to talk about my sex life with you. I don't talk about my like the dollar amount we made last year. I don't talk about any number of things that's for us. It's not for you, as I started having grandbabies.
I have had way more information from my children about the arrival of children. I'm saying how they got here. Yeah, then I wanted to know. I'm just telling you. so I just assume we went her direction and just said, you know, y'all, just keep that to yourself.
I really don't want to know some of this. I just want to see the baby when it comes. I'm happy very much. I'm happy. I don't need to know about the practice.
Nope. Thank you very much. It's all good. Oh, my gosh, It's the same stuff. You're exactly right.
You're like. I'm not gonna tell you about that stuff. No, Papa Dave don't want to know. no, Papa Dave don't want to know. I'm saying I meet the baby, That's, I just show it.
Just tell me what the name is and tell me what the sex is, when it's appropriate to tell me, and then tell me when I can tell people that, and Then I will and don't tell me unless you want me to tell somebody, unless you tell me not to tell them.
I need America to know I had a great joke that I didn't just you. you didn't use it.
You.
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Dr. John Deloney Ramsey personality, is my co-host today. open phones at 888-825-5225 5 225. today's question of the day is brought to you by neighborly, your hub for home services. When something in your home breaks, remember the neighborly done right promise, which is it's not done until it's done, right?
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All right. Today's question comes from Flustered in Florida. sounds like a dear Abby. Well, what would your name be Dave?
Handsome in Nashville devilish, devilish Dave.
Today's question comes from flustered in Florida. My wife and I have been married for nine months and for the last three months We've been working the baby steps. We each came into the marriage with debt. Our total combined debt was close to 50 50 thousand bucks, but I recently cashed in a whole life policy. That was worth 22,000.
We've used it to pay off all our credit cards and a small student loan that I had had no problem using this money this Way, even though most of the credit card debt was hers. The way I feel is we're now one, and so is our debt. However, she feels very guilty about taking this money. It makes her feel indebted to me. I hate to make her feel like she needs to pay me back, since I don't feel like this at all.
Do you have any advice for this situation? We think man.
Well, I mean, yeah, it's. it's a discussion of a View of marriage, you know, you're not in debt to your spouse ever. You're all into yours, you know. and for richer, for poorer, in sickness and in health, I mean if you get the flu and she makes you chicken soup, do you have to pay for it? in sickness and in health?
You know if she, if you're laying in the bed, you know sweating through a fever because you got the flu, She's working and she's taking care of you, and you know, so forth. Do you have to write a check for that? All right, You know, No, We took, we took on each other's burdens, where our goal, once we walk down that aisle, is to serve each other the rest of our lives, to do everything we can to make the other ones person, person and life better, and That includes we took on each other's debt. We took on each other's income, We took on each other's assets and we took on each other's crazy parents.
Yeah, I I don't think. flustered in Florida, I don't think you can make your wife feel anything. I don't think you have that kind of power. agreed, and my guess is She probably grew up in a home where? Anytime somebody had to do something for her, whether it's buy her a new pair of shoes or some jeans or get her to school on time.
She was made to feel like she was a burden to them, and so now she's married somebody who loves her and it's all in and She doesn't have the for lack of better terms. She doesn't have the script for that, She doesn't have the wiring for that. And so she's gonna have to choose on her own to feel that discomfort and Realize you're not holding us over her head. This isn't an ROI. In fact, I, Dave, I told talk to somebody recently who's had a Relationship struggle, and he said the person that he was with Was listing off all these things that they do versus.
and I said, once you get into, list me. once you get into ROI, comparison your relationships in trouble. Sometimes that's an important conversation to have because it's way out of whack. But man, once you start keeping tabs, That can be the death of a relationship and she married someone that doesn't do that, And so she's gonna have to learn how to not feel guilty every time. she needs some, some support, some love and some care.
well, this is just a. It's a philosophical view of a proper marriage relationship, and the philosophical theological view is I No longer own anything. We, we do own everything, and.
That's training that you can decide To do that. We, I tell couples all the time when you get married, your pronouns change. It's not mine and yours. It's ours. It's ours.
We're French. We, we, you know, and so it everything's a week. It's a pronoun, is a plural now, And I'm not talking about pronouns out in the crazy world. That's not what I'm talking about. I'm talking about out of the abundance of your heart.
the mouth speaks and go, we had some debt. we paid off the debt, Which is how flustered feels, but his wife didn't feel that way, right? And so I think we just talk about it out loud and go look, the right way for us to view this both of us. Is that everything that's mine is yours and everything that yours is mine. There's not any years in mind.
It's ours, and If we can get there and start using our intellect as an act of our will to practice that and practice thinking about it that way, then
You know, it changes everything. I'll give an extreme example out there for those of you listening. I mean Sharon. my wife has not earned and one dollar of income other than consignment, sale, clothing, Since Denise was born and Denise is 38. But we have had a really good income during those 38 years.
You know are 36 or whatever. She is, but I mean, you know, but we have an income. the Ramseys have an income. I Technically earned all of it Technically, Except for the part where I get to go to work all the time because she's doing all this other work. That's right, But you know that.
so it. you can't really bifurcate all that and it worked out any other way. So we have an income and you know and Sharon, Sharon will use that. It took a while, but you know, she was like, hey, you know, you're making pretty good money. No, we, we are making pretty good money.
We are. we make enough for us to buy that car that you're gonna drive, right? You know, and you really got to kind of practice it. Yeah, especially when there's a single income family or when one of you brought more Assets to the table. in his case.
I used his whole life policy to pay off her credit cards, But it's not his and her anymore. Once you get married. It's ours. Here's another side. I made this mistake.
I bought a car with cash. I don't know five years ago and
We didn't take a note out on it. I just bought the car and went down to the courthouse, But I put it in just my name. Oh, and it never occurred to me and it my wife said
That makes me feel like you and did a thing on your own. it never, even it, never, even. no. No, this is ours. All this is ours, right?
And so even even the going back to the courthouse and changing the name, this is John. both of our names are on the title.
Which cost a little money, it's yeah, but it's important. It's an important thing. Very important. Yeah, very important. Well done.
So it's something flustered. You've been married a whole nine months, And so it's something you, it's a muscle. You guys can grow into and learn. It's very possible. You're gonna be just fine, But it gives us a chance to get up on a soapbox and tell everybody how to do it.
Cory's in Norfolk, Virginia. Hi, Cory. How are you?
Hey, I'm doing good. How are you guys better than we deserve? What's up? Good Well, me and my wife. We're looking to move from Virginia to North Carolina.
We have a toddler that is three years old. So we're looking to get to a lower crime city and somewhere with better schools. So we currently don't have any debt other than our mortgage. We owe about 240 on that. we can sell our home for around 450 here.
We would be looking to purchase there for five to six hundred thousand. We'd be looking to roll probably 175,000 from our current home in. we also have 125,000 total in savings. So just trying to get an idea. Is this a smart move for us to go ahead and make?
Taking? you know our emotions out of the situation and how much would you put down if it is a good situation?
I put down everything I had except for three to six months of expenses, and I would put the payment with the mortgage that you take out on a 15 year, as long as the payments no more than a fourth of your take-home pay. then you can afford this.
Okay, and I think you can't all right, I think it. I think it fits in your numbers, I think you're just fine. You are moving to a less expensive real estate market and still moving up in-house, by the way, and blaming a little baby.
I.
Would much rather I Dave's on to something really important. I think, For the sake of your relationship with your kid. I think it's important for you and your wife to say hey, we want to move for a better, Because we have some goals for our life. But during that stress of moving, that stress of getting a driver's license, It can be real easy to look at that kid and slowly start to resent that kid. We're doing this for you.
No, you're not. you're doing it for y'all and the kid. Yeah, when new schools too, of course, but also it's for y'all. Yep. Yep.
Yep. Yep. Yep. Yep. Yep.
That's how that works. Yeah, just I mean, it's it all of its fine. But you did move up in-house in a cheaper real estate, market, Point being you didn't have to to accomplish the school goal only. but that's okay. You can afford it, I think, Cory.
so I'd probably go right ahead. I just watch my. I always try to think about How I what what I used to reason my way through that and was that was that reason process Factual, and that's why I'm challenging you, just to help you with that in the future. This is the Ramsey show.
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Dr. John Deloney, Ramsey personality, is my co-host today. Lee and Nicole are on the debt-free stage in the lobby of Ramsey solutions. Hey guys, how are you? Hey, great, Better than we deserve.
Where do y'all live? We live in Greenville, South Carolina. I love it. What a great town, beautiful. Welcome to Nashville.
Thank you. How much debt have you paid? We paid off.
$462,000.
53 months, 53 months and your range of income during that time. We started out at about 180 and then up to 305. Wow. What do y'all do for a living? Oh, Both of you, you on the practice.
No, but both of you making a hundred and a half a baby Yeah, or thereabouts. good for y'all student loans. It was.
Those vet loans will get you man.
Took a call last week from a guy whose wife was wanting to go be a veterinarian. He was trying to. he was an accountant. He was trying to figure out if it was worth it. I was with you.
Yeah, yeah, I said it was worth. it's worth it, but you got to really think it through 400. so you've been out of school five years. I'm guessing.
Okay, so what happened after? you know, at this it looks like about five years ago. this thing blew up. what? what's the story so?
It started in 2015,, that's when we graduated vet school, and each of us owed probably 170,000 or so. Mm-hmm. We were put on an income-based repayment plan, as you do and You know at six and a half percent interest one hundred seventy thousand. We weren't even covering the interest. Not even Yeah, and so between between 2015 and 2019, our loans went from one hundred seventy thousand to well over 200,000, and each so each double, and so it was early 2019.
They didn't do a lot of math in vet school. But even you knew that.
We had no plan to try to tackle this. we hadn't absolutely no. so stressful for sure. and Thomas Greiner, he's a vet. He was our classmate.
He and I were working together and Early 2019, he invited us to his church to attend FPU. Oh, wow, and Nicole, she was really excited about it. I was very hesitant. I was like, you know, we make what we make. What's this Dave guy gonna tell us that we don't already know about money.
Yeah, boy was I wrong? So early 2019 we went through FPU. we actually missed week nine, the last one because our son was born, Oh, and.
Him coming into the world, it just kind of changes like we got the icing on the cake.
We got to get rid of this yet. Yeah, and we don't want him to have to go through what we did. Go through what we did. We want to be able to pay for his college one day. So he was born in early 2019..
We had like a thousand dollars worth of cell phone debt 29,000 between two vehicles. Yeah, and the remaining four hundred thirty-two thousand was our student loans, and so It was. it was like late 2019.. Yeah, we started in on my half of the student loans and We still. we still didn't even really know if we could do it.
It seemed like such a huge mountain, Yeah, and then such a timeline early, early 2020, kovat. Thanks, kovat.
Helps us so much.
So, you know, we we got the the paws on the interest, and that's when we, just really we, were able to do it through everything.
And y'all were essential, so you kept working like crazy people work more than yeah.
Yeah, and you weren't part of the ninety nine point. nine percent of Americans who just sat y'all exactly. y'all looked at this as an opportunity.
It saved us probably eighty ninety thousand dollars of interest. You know what I bet it did. Yeah. Yeah, Over five. that's pretty tough.
That's right, because you hit it exactly, right? Yeah, that's amazing. started the loans just before.
Cove. it is before y'all, Wow. and then early this summer, We actually decided to move to Greenville. We had been living in Georgia the entire time, So we sold our house, took some of the equity from it and paid off the rest of her Yeah, her loans right before the payment started back. Yeah.
Oh, perfect. So perfect timing.
Yeah, and then took nude new vet jobs there. Yeah, exactly. Are y'all working the same practice? We actually are. Yeah.
Yeah, large animals, small, small, small, and now y'all are 300 plus with no debt, that's right.
We got to get a house again. So that's where we're headed. We're in 3b now. Yeah,
Way to go. You got. that's a different house when you don't owe four hundred thousand dollars. That's right.
Well, you don't need a bedroom for Sally May.
Way to go. y'all. Thank you. You gotta feel like I can do anything like you got a superpower. It's a weight, weight, weight going, for sure.
Yeah,
All right, hey, could I could I ask you a hard question? sure, I want you to speak on behalf of everybody in this industry. Okay, and I say this industry, that's not true. in with this mindset, Millions of people go through FPU and they know, I don't know what I'm doing. Yeah, There's a whole bunch of people that make a lot of money that think, Ain't nobody gonna tell me, Mm-hmm.
and they're real smart and they got a lot of fancy letters after the name and some huge frame diplomas on their walls. I'm huge student loan debt to go with a huge student loan debt, and they can't breathe and they're arrogant at the same time. Right, what finally got through to you? Because what you said, I hear that all the time from my medical doctor buddies, my my nurse practitioner buddies, Like this Ramsey guy like, what's that? Oh, okay.
Just live on less than you. Okay, man Like, that's a hard thing to get through that ego. Yeah. Yeah. No, it was.
You know, just going through the class, It all made sense. And, and when I, when I actually sat down and figured up the numbers and did the calculations, It's like, yeah, this would work. Like, all we've got to do is do it. We have to set our mind to it and just do it, just plow through and go. Yeah, so once I actually ran the numbers, that's what flipped the mindset.
It's so daunting looking at the big picture like that, And then if you kind of scale it back and do one step at a time, like like the baby step show, It's it's much more manageable. How do you eat an elephant a bite at a time? exact? Way to go, y'all. Thank you.
Who was cheering you on telling you you could do it? So Thomas, of course, Started, and then our good friends Marcy and Eric. They're watching. Hey, and then my parents as well. All right, very good, Anybody roll their eyes and say you're crazy.
Yeah, it came up quite a bit at work and we just mentioned You know what we were doing, and some people were like, you know, yeah, that's cool. Some people looked at us like we had six heads Like what you're throwing $10,000 a month out the window, you know when you could be buying a bass boat.
And for going that many years of Retirement savings. It's just yeah. Yeah. Yeah. Yeah, 53 months.
I mean you've been scratching for a while.
This is real. Yeah, and you have the junkiest car pulling into the.
To the parking lot, not really because I was part of our debt, right?
Yeah, so a stupid move is like six months before I graduate a bit. I bought a brand-new f-150.. Oh,
It's required. I've still got that truck. It's 10 years old now, but it's paid for. Yeah. Well, treat it, right?
You can give it to your child.
Great job, Lee and Nicole. way to go, y'all. We've got the live and give box for you. It has in it the baby steps, millionaires book you'll be there in a minute if you're not already and of course, the total money, makeover book as well, and Financial Peace University, which did it for you guys, and You guys can, of course, give that to somebody or go back through again. Whatever you need to do.
All of this is for you to enjoy or to give away the live and give box. So congratulations. very proud of y'all, heroes. Thank you. They kicked it, man.
That's a long run right there. It's a big deal. All right, Lee and Nicole, a couple of veterinarians and Greenville, South Carolina, these days making force Our paid off. four hundred sixty, two thousand and fifty, three months make it 180 up to 305. Count it down.
Let's hear a debt-free scream.
three, two, one, We're free.
That's how it's done right there.
It is amazing that For a math nerd like me, that when you crunch numbers and can see that you can do it, how math becomes hope.
Yeah. Oh, yeah.
Nobody thinks of math being hope right? But when you go, wait a minute, I can do that. the first time I ever saw a hundred dollars a month invested from age 25 to age 65 and You know, in a decent growth stock, mutual fund becomes 1 million one hundred seventy six thousand dollars the power of compound interest. I thought I could do a hundred dollars and I'm only 22. That's the first time I saw it and I thought I'm gonna be a millionaire.
This is really gonna be me.
Bing math gave me hope. it's imagine. It's amazing to me how many very, very smart people Don't sit down and do that very thing, because, like him, I just ran the numbers and then he thought he's a smart guy.
He's like, oh, I can. I got a path now. I can do it. I can see it. This is the Ramsey show.
Dr. John Deloney Ramsey personality, is my co-host today. Alex is in Ann Arbor, Michigan. Hey Alex, how are you? How's it going, guys?
How are you better than we deserve, sir? What's up?
Hey, so I am 20 years old. a little back story about me. I am actually married I know it's quite a young age with my beautiful high school sweetheart of five years. My father and my grandfather unfortunately passed away just a couple months ago. They they mainly helped me when it came to finances, even though they were still heavy plastic swipers.
My mom kept my dad's debit card away quite frequently. because of that reason, My wife and I are kind of just at a standstill right now. We the way we're saving money. I just feel like, isn't right? We we make about about seventy, six, seventy, eight thousand dollars a year.
We both do patient transport at the University Hospital And we don't have much saved up and we're just kind of. we've got about twenty two thousand dollars or twenty two hundred dollars in debt 22,000, including our cars. We just bought our first home with a condo And we're just kind of seeing what would be the best way and where we should start paying our debt off.
Okay,
It.
Sounds like you've got the opportunity at a young age to really start.
a whole plan and Implement every detail of that plan to get you to where you want to go. and right now, All you're doing just trying to make sure we keep the lights on, keep food on the table and nobody picks up anything. Repos, right, right, right. Yeah, Instead of a plan, you're kind of in survival. Did your granddad or dad leave you any money?
No, they did not, They. this is all of our, all of our money. when it comes to With the money that we use for like down payments on our condo and, for you know, down payments on our vehicles and stuff, It's not a hundred percent self-earned. We haven't received any money. We haven't loaned any money from family or anything.
So I want you to. I want you to internalize Really deeply in your heart what Dave just said. you and your wife at a really young age are.
Deciding to change everything about how y'all do marriage, how you do money and What your kid when he reaches to be 20, when your daughter reaches the age of 20, what their life will look like because of the? Decisions y'all make today. Yeah, that's a big deal. It's a huge deal what you're doing. I'm proud of you.
Yeah, way to go. Thank you, Very, very good question. the way you're where your mind is the way you framed. the question is you're in a really good place. So what we do is we.
we have a class called Financial Peace University. That's nine weeks long and About 10 million people have been through the class now. Okay, over the last, you know, 30 years and so. and it's of course. the class has evolved and has gotten better over time and But, but in its current form, if you go through that, it's everything you should have been taught about money Before we let you out of school, you know, but nobody's teachers are hardly.
So we're gonna give that to you guys as a belated wedding gift And I want you to go through the class with your wife. both of you Attend, both of you go to the nine lessons, both of you buy off on. here's what we're gonna do. You join hands, you get a very clear, high definition picture of where the few, what the future looks like and what the price has to be paid to get to that future. and when you do that, you'll go, do it and You're gonna be in a position to you know, again, like John said, be, you'll be very wealthy.
You haven't made any huge mistakes. You haven't been thrashing around, and I think that's the gift your granddad and your dad gave you. They didn't give you any real insight In where money comes from and how to how to think big about it, because they didn't have any. we know that because they didn't leave you any, but the But they did kind of keep you tempered to where you haven't gone crazy, Like a lot of the people in the public have gone. So you've not got a way.
huge piles of debt, You know, you've got, not gone, you know some silly numbers in the numbers you gave me there. There's some trouble there, There's some problems there, but there's nothing, nothing bad, Nothing super bad. So if you'll address the stuff that's there that we teach you and go, do this, You're gonna be in a really really good position. Hang on, also, pick up, and we'll get you signed up and get you guys to go through that at 20 years old. God almighty.
I wish I'd gone through that at 20.
. Oh, dude. Don't even get me started.
the awesome.
Natalie is in Logan, Utah. Hey, Natalie. Welcome to the Ramsey show. Oh.
My gosh, how you guys. this is so exciting to talk to you. My heart is racing, which seems to I mean my living room, but I'm so excited to talk to you guys today.
Well, we're excited to talk to you. How can we help?
Okay, so I am a mom. I have two little boys, I've got a three-year-old and a five-month-old, and so ever since our three-year-old is born, we put a small amount of money to the side for his future. and so What I'm wondering is I recently found out about 529 plans. so I'm trying to figure out. we've already have some money saved up, and so it's like What's the best way to invest that for our children?
Should we invest it in stock? Should we put it in CDs? or, I guess, what do you think about 529 accounts? That's really one of what I'm wondering here.
Well, 529 is used for education. It grows tax-free, which is wonderful, and We always recommend you put that in good mutual funds that you control. 529 in other words, what we're suggesting is mutual funds, and the way it's treated for taxes is dictated by 529. and just like IRA is not a real investment, IRA is how an Investment is treated for taxes. And so that that's what you're looking for here.
so if you're saving for a kid's college, 529 is the way to go and You can learn about them, they're really easy to learn about. just go to you know. Go to Ramsey solutions, calm, click on SmartVestor Pro. You can sit down with some of the folks that we endorse around the country for Helping people with the heart of a teacher with their investments, and they can help you get that started. How much have you been putting aside for these kids?
So both of my boys get $40 a month. So it's $80 a month that we put away for them.
Okay. All right, not bad at all good. And so yeah, they can sit down with you and help you put that together. and You know that that's gonna Turn into some money. I mean you're, it's gonna end up with some money there.
the the, an ESA, is the 529's cousin, Educational savings account, same thing by mutual fund and qualified as an ESA. The maximum on it is $2,000 per year, which would be a hundred to sixty six dollars and sixty seven cents per child per month. And if you did that from 0 to 18, you'd have about a hundred twenty five dollars. give her $25,000, Give or take in there. in that 529 You would have only put in About, let's say, 2,000 times 18..
You would put in about thirty six thousand dollars. So you got about ninety thousand dollars. growth that's tax-free. and So that that from for fully funding a baby at two thousand dollars a year. hundred sixty, six, sixty seven a month That sets you up and that today would send you to a an in-state school for your undergrad that would take care of it.
What is what's the max on a 529?
It depends on the state 10,000 a year. usually you can put more in it than you should, or sometimes you can load it up like three or four years. Put, put 10,000 in and then quit, set it and forget it. It'll grow. it'll grow up to be enough, then, and you don't, you don't have to keep adding to it every month the whole 18.
years and I've heard recently that there was Adjustment made the last couple of years that if you're You end up putting enough money in the 529 your kid goes to college that they can roll that into an IRA at some point.
You can move it to a Roth IRA, but the limitations on it are pretty severe. So I really wouldn't, I mean think that way. Yeah, I would more likely move it to another family member to go to school. Okay, more than likely it's going to be a better use of the money. But because the formula they're using, that what you can move and how long you have to wait to move it, and all that, You know, they there's a good idea and then they mucked it up with too many rules.
but the But either way, it's still a great place to save money for a kid for college. if you're. if they're not going to go to college, It's not a great place because it has to be used for education for someone. or that $90,000 in growth will be penalized. And so you're not gonna.
the fact that it grew tax-free, all that wonderful idea is gone if you don't use it for that. So you got to make sure that that's we roll up for. but here's the thing. I Have never met someone. oh, by the way, if you, if the kid gets a scholarship, you can take that much out of the 529 and Pay no taxes on it at all.
So if your kid gets a $2,000 scholarship, you can take 2,000 out of the 529. put it in your pocket.
That's always been the argument What if my kid gets a soccer scholarship? or is a genius? you can, you know, if you get a scholarship, you can take it out.
But here's the thing. I I've been doing this 30 years. I have yet to run into a single person. Call me up, said Davey told me to save up for my kids college, and I hate. I hate you.
I screwed up everything. I hate you. This is the Ramsey show.
Live from the headquarters of Ramsey solutions, it's the Ramsey show where we help people Build wealth, do work that they love and create actual, amazing relationships. Dr. John Deloney, number one best-selling author, is my co-host today, Ramsey personality and host of the dr John Deloney show on your past change. your future was his first one. You can check that out.
or how to build a non anxious life. Second, number one bestseller just came out last fall. Check it out as well. Jonathan is with us in Fort Myers, Florida. Hey, Jonathan.
What's up in your world? Hi, how are you doing today, Dave, better than I deserve? What's up?
Um, so I had a situation happen a couple years ago during COVID. my mother passed away. She was actually Killed by her, Her new husband. Oh, my god, man. yeah, they were both in their late 70s and they Left me with quite a bit of money.
so I Never. I never made more than about 85 grand a year and then was left with a couple million dollars, And I hope I've been doing the right steps With what I've done with it. I just wanted to get mostly some reassurance that I've been doing the right things or what you would recommend.
Moving forward with this. Oh my gosh. How have you navigated the last few years with the loss of your mom?
You know, the first year wasn't too well, you know kind of. you know kind of went backwards, probably a little bit, and then trying to. I got a Couple kids and I tried to get myself together and be better for my kids, And I think I've been doing pretty well the last two years. How old are you, Jonathan?
36, okay, and I assume he, the Husband's been put in jail.
No, he killed himself afterwards. Oh Yeah, I know him in our house that we grew up in, oh.
I'm so sorry. Hey, well, that just makes it. I mean Managing two million dollars that you don't know how to manage is freaky enough, and then you put this layer on it. It just gets super freaky, right?
Yeah, yeah, it's a little more than that. We were left about two, two million two and a half million from our parents, and then he left us another 1.1 million.
Oh, wow,
Which we weren't expecting. we can know that we were written into as well.
Wow, does that money feel weird? Are you? Happy to spend it. All right?
I Have spent. I haven't really I wouldn't say I've spent it. I've used most of it to live off of the last couple years from the from the, the new husband I. He left us two IRAs, a traditional IRA and a Roth IRA. Mm-hmm.
So I've been pulling out. Let's get worse. You know, let me get past all the great And just answer your question. So how much money do you have today?
Today. let me just look over here. I've got Total between properties and everything. Yes, I would say about.
Three and a half million, okay, and you're still working making 80.
No, I haven't been working since the day she died. Oh, wow. Okay. What did you do for a living? I Worked in restaurants, mostly bartender, sommelier and server.
Mm-hmm, And the reason I didn't go back to work was a lot of that. the reason why I made good money was because that was. I was always Forward about my my life and talking to people about things in my life, and I just felt like I couldn't do that anymore.
Well, you can't go into this story. part of the story anyway, wow, okay, are you? are you married still or single?
No, I've never been married. I'm single. You said you had kids. Okay, Yeah, two children One that I have full custody of, one that I split custody.
Okay, an important part of your recovery moving forward is you're gonna have to get, You're gonna have to get a job. Yeah, you have to get a purpose, a thing to do a thing, to go to a thing that you are a part of. that the World's gonna be better because you were a part of it.
You got that. Yeah, I feel that as well. Okay. Yeah, it's time. It's time to go back to work, Jonathan.
Doing something. I'm actually start. I'm actually starting a business this year, a turbo business.
What tour boat? a Tiki boat, tour boat. Oh, okay. All right, you're buying the boat and gonna, yeah, do tours and do trips on the boat when.
The boats going to be delivered in April or May of this year and we should be operating by June.
Okay, what did you spend on that boat?
220,000 total. Okay. Okay. All right, now you're gonna be Leaning in, learning how to run a business, learning how to handle and operate the boat. You're gonna be leaning in on all of this, or I really want you to.
I want you to go make a living for your sake, because at 36, Doing nothing is not a plan. Okay, you know, for Emotionally, spiritually, John's right about that now. So let's pretend that you're making a living. You don't need this money, then, right? So now we just need to invest this money.
Well.
Yes, okay.
Jonathan, I buy two things for investments. The first thing I tell people and I was with a bunch of wealthy people this weekend Do not put money in something you don't understand. don't do it because I do it. don't do it because somebody else says to do It, or you read an article once. that's a.
that's a nightmare way to lose money. put money in something you understand now. That may mean you need to go to school a little bit by sitting with an investment advisor and letting them teach you. But I buy real estate that I pay cash for because I like the real estate. I've done that already, Okay, and I buy mutual funds, and that's all I buy.
Okay, I've got about a total about a 1.
8 million in real estate. Okay, and it's making money, right? We, I have one house that's gonna be worth about 1.2 million and I'm planning on renting that. Mm-hmm.
Gonna win. Why is it not worth that now?
That it's about to be finished being built and I think in March or April of this year. It'll be done. Okay. All right, so you're gonna have, and then I have a, I have another rental house and then I have the house.
I live it. Okay, that's fine, great, now manage those to where they make a good return on the amount of money you have tied up in them and Then sit down with a good Someone like a smart Vista Pro. You can find them at Ramsey solutions, Dot-com, and they'll help you sit down and start to understand some mutual funds and invest it. But I mean if you make 10% on three million dollars average across that those investments, Then you'd have three hundred thousand a year coming in. if you don't touch it.
in Seven years that three million at ten percent would be worth about four million. It would be worth about six million. in seven more years. It'd be worth about twelve, and seven more years would be worth 24. That's 21 years.
from today. You're 36. that puts you at 57 with 24 million dollars. I.
Like that, okay.
That's you working, providing your own living, not touching these investments and letting them just grow, and an average growth rate of 10% a year, And that's invested in mutual funds and real estate. Well now it's a little more complicated than that, But basically that's how the math will roll out. The trick here to the thing is put money and stuff that's steady and is predictable, Not super conservative, but not. we're not taking any big risks here. We're not trying to reinvent the crypto world or some bull crap like that.
You go for a quarter million dollars and then six months, go and be like, well, I'm gonna do this. I'm gonna buy a snow cone stand and then you're gonna stay on small business yourself, broke.
Yeah, stay on track with that. And so you're now in the tiki boat business for the next decade, buddy, and you're gonna make a go of it. You know John's right. You don't get to change.
This show is sponsored by BetterHelp. Hey, good folks, It's Deloney and with back-to-school madness on deck, My family's schedule is already so packed and we haven't even made room for things like exercise and date nights and counseling and all the other things that make our life even worth living. When it comes to taking care of me, I have to remember to put on my oxygen mask first, Meaning I have to do the things that help me stay well and whole, and you have to do the same thing, too. Together we can show up and be strong in all of this chaos. So don't skip the things that matter to you, including therapy.
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Dr. John Deloney, Ramsey Personality is my co-host and is with us in New Orleans. Hi, Ann. How are you?
Hello, I'm fine. Thank you so much for taking my call. Our honor. How can we help? Okay, my question is my husband and I, my ex-husband and I, were a co-signer on my son's condo back in.
2004 and since that time he is on a. my son is unable to Pay his mortgage because he's unemployed. He lost his job and No, no, no, we paid purchased the condo in 2004. this past April he lost his job And sent, and he's been unable to pay the mortgage. How many times did you pay it since 2004??
Oh, It's happened before. about 10 years ago He ran into trouble paying his mortgage and he was able to do a forbearance and.
Of course, I assisted financially at that time and you keep using the word unable. Is he unable or is he unwilling?
Yeah, why do you not have a job, my best friends in the world's a paraplegic. he is unable.
No, no, he's physically capable? Okay, he has not, and he has not found a job since April.
He says he's looking one of the hottest bondage on the hottest hiring markets in human history. He's chosen not to work.
I Guess so. Okay, let's use. I just want to be. I just want to call a spade a spade because it helps us make decisions.
Right. Yeah, now. Yeah, I'm just saying you're still on the mortgage.
Yes, my ex-husband and I are co-signers. So we're responsible for paying the note if he does not.
Mm-hmm, and he's not been.
Yes, so I have been painted since April. Oh, my ex-husband made about three of the mortgage payments. So now I want to know what would be the best Avenue for me to convince my son to sell it. Let it go for foreclosure and I told him, or else you get a job and you pick up the payment, But I don't want it to go to foreclosure because I don't want it to Affect my credit. I haven't.
my credit rating is.
820. every time it's paid late. It affects your credit.
Yes, I understand. So I just don't know if there's any options for me. Is he on the note at all? Is he on the note? He's my.
my son is the owner of it. Yeah, he's on the note. She'll all three a signer.
Yeah, you can't force him to sell it. you can just talk him into selling it. will he sell it if you tell him to?
No, he's dragging his feet about that.
He knows you're gonna pay for 20 years. you bailed him out. Yes, I understand that and you've probably given him some stern talking to us over the last 20 years. Yes. I have you still paid it.
So yeah, he's dragging his feet because you taught him how to. I think you have to sit down and say I'm not paying this, Dave, I'll leave it to you. I mean, it's gonna. it's gonna ruin your.
You're. yeah, you're. you're gonna get foreclosed. on if he gets foreclosed. Yeah, that's how this works.
So can you afford to buy him out?
I?
Could
But I just don't know what my best options are, because if I buy, if I, if he would tell me the condo, Then it's mine right for me to do what I want with it. Exactly.
And then you can. then you just know, then he, you sell it and Right resell and get your money back out, and at least that way you didn't lose anything.
Yeah, you can just say all right, let's get it appraised. I'm gonna buy it from you and then you put it on the market and sell it. That's what's best for you. That is unbelievably aggravating, and It's not necessarily what's best for him. What's best for him is to experience some pain.
Um, but, but he's not going to in this scenario, unless you do That's the problem with co-signing you get to experience the pain with him.
And he's gonna play chicken with you and you've got a lot more to lose than he does financially, right?
Yes, I do. Yeah, what's the condo worth?
Maybe about 40,000 Worth 45.
. No, I would well, in that he would be. he would be lucky if he could get 60 for it.
Oh, my god, what do you owe on it?
30.
Okay, and he's got 11 more years. Okay, go, go, tell him that You know, he can no longer screw up your life With his laziness. He needs to sell you this condo, Even if you buy it for whatever. have a real estate agent, give you an appraisal, buy it for that amount, Put it back on the market and resell it, and he needs to move.
Okay, yeah, that protects you, I'm. for some reason. I thought this was a $600,000 condo. it's a 60. Yeah, just you can, you're, you're?
you may lose a couple thousand bucks here or there by moving all this gyration around, But you need to get out of this trap. You put yourself in and the trap is co-signing. You can't get out of the trap. You're either gonna be an enabler or you're not gonna pay, and then he's gonna get foreclosed on, which means you're gonna have a foreclosure On you, and then they're gonna come around looking for all of you Wanting some money out of y'all, because the condo won't bring enough at repo to even cover the old mortgage on it. But it's a piece of crap, condo to start with.
And I'm sorry, will you forgive yourself for the divorce? finally, yeah, yes.
You're still trying to make that right with him. stop 20 years.
Yes, you're gonna lose. you're gonna lose some money, but you're also gonna lose your relationship with your son's not worth it.
yeah, I would. I would buy it from him, have him move out and.
Turn around, put it right back on the market and sell it, and if you lose a little bit that way, that gets you out Of this trap and then you have a standalone relationship with your son. That's mother's son. That is no longer cosigner, because cosigners, putting a strain on everything, It's making you do things.
you're not, you don't feel good about, and it makes you resent your son. every time that phone rings you, you Feel your chest tighten up, because what's he gonna ask? like it's, it's altered your relationship, gonna ask for now?
Yeah, this time because you're aggravated with him, like we are, for being lazy, not working since April. my god, How much does it take to pay the condo note on 30,000 bucks? I mean you can. you can do like do uber one day a month and pull this off. This is about the laziest human.
I've run into Pretty rough. I mean really? Yeah, think about this. just. I mean, it's not like it's a lot of money.
Hey, I don't even know how the boys eaten. Well, we are do and yeah and stick, making sure he's got groceries. Yeah, so, and you got to stop it. It's time you put him on, put him out and let him figure out how to do life and just love him from a distance. That doesn't include your checkbook for the rest of his life, and that's the biggest favor.
You can do him and yourself and moms and dads out there, never, ever.
Cosign. it's not an act of love.
It's not, it's. it's the ultimate enabling, and it locks you into Enabling because, out of self-preservation, you have to cover the stupidity of the other party.
What about this, Dave? I'm trying to think of how this situation for her could go wrong. Is there a moment when and again, I know I'm speaking in ratios here, But $50,000 against what and has is not a lot of money. can she buy this thing and Hand it over to him and walk away and dust her hands off, walk away. Is that too much enabling?
I wouldn't do that. No, yeah. No, I think I think it's. I think he's not gonna move is what I thought he's not gonna sell it.
To his mom. Yeah, Hmm, Well, then I would just take the pain of being foreclosed on you, would I just stop? Okay, you're gonna show it to me, or The days of me giving you money are done. They're over, and that's what I'm getting. either Sell this to me or you're gonna have to figure it out.
Okay, I'm done. Okay, because that's this is so bad for him. Yeah, she stunted his emotional growth.
I Can't. I can't get a job since April to pay condo notes on 30,000 bucks. This is lame. Yeah, this is really a lame boy.
we talked to elementary school teachers trapped in a New York apartment during kovat, who pay off six figures because they Drive and scratch and claw and flip and do whatever they got to do. Yeah, right,
Yeah, it's tough. man could sell enough clothing out of his closet. plasma, Simon's. I'll get plasma your way to that one. It's just.
it's just not any money. So Yeah, you got it. you got to get him free of you and you got to get free of him in order to have a decent relationship with him and In order for him to ever be a real man.
And it's gonna cost you that precious 820 that you're really, you're really proud of. it's gonna cost you. Who cares about that? Let that stupid thing go. Yeah.
Oh my gosh.
Now condos, never been late. She's paid it on time every time, every time It's never been late, It wouldn't be 820.. This is the Ramsey show.
You.
Dr. John Deloney, Ramsey personality, is my co-host today. Ryan and Haley are with us on the debt-free Stage. Yep, right here in the lobby of Ramsey solutions. How are you guys?
Wonderful. How are you better than we deserve? Where do you live? Lewisburg, Kansas, about 45 minutes south of Kansas City.
So yeah, you need to be wearing some Kansas City gear today, for sure. Oh, yeah, of course. Yeah, wide, right, baby Man, here we go. Way to go. Good stuff.
So how much debt have you guys paid off?
458 thousand six eighty Wow.
Love it. How long did that take?
six years.
Six years. Mm-hmm and your range of income during that time?
Well, when we first started, it was around a hundred, our peak was 260 and we went down to.
112. now, okay, that was with the job change. Okay. All right. Very cool.
Good. Good, good, and uh.
459,000. what kind of debt was this? a little bit everything, of course. So we have a few cars that we paid off, of course, our student loans, we paid for Credit cards and our house.
Look at it weird people. Yes. I love it. Very good. Great job.
What's this house worth? It's right at 350. good for you, man. That's awesome. How old are you to 35 and have a paid-for house and now don't have to work as much?
so took a different job and.
Downsized one job and all that kind of stuff. Yeah, finally got to do thing. He likes to do. you don't have to work.
Yeah, Very, very cool. Excellent job. Excellent job. Well, for those of you out there in America that don't know, we have a Program here at Ramsey called smart dollar and it's from the financial wellness side of things. What happens is companies Buy smart dollar and provide the.
financial curriculum to free to their employees, and It's having a massive impact on employees all across America. You all had a bunch of their folks. come on here a few months ago and do debt-free screams We've had. you know, Costco has taken their folks through it. It's and companies of all sizes, not just huge ones like you all and Costco, but I understand that your company bought Smart dollar, and that's what got you guys started.
Is that right? that it was for the most part?
I mean, I was. we were already doing the program really before, but it just added an extra When we started working there, because I started working there about eight months ago.
Oh, so, you were well on your way, And this just helped you. the new job that you got, that you love. Yeah, is the company that has smart dollar? Yep. Well, that's good.
That's great. Okay, so a little bit worried about it there for a minute. Your company name. that furnishes smart dollars. what strategy LLC?
strategy LLC, what do they do? it's a.
Marketing company, web development and an IT. Okay. What do you do? I'm in the IT side. Okay, cool and Haley.
What did you used to do? I'm a nurse. You're, you are a nurse. Okay. Okay, good.
Very good.
So what happened this many months ago?
They all. just before strategy LLC was doing it. you are, you guys were already Game on, and then you, you, 60 months into this or six years into this, you knock it out.
What got all this started? John's right? Well, we, you know, we got married back in 2017 and then you know We started making some decent money. And so when you make decent money, you go out and buy new things. Oh, of course bought three new vehicles within like six months Brand-new.
so, you know, a lot of depreciation on drivers for two drivers make sense. Yeah.
Motorcycles, you know all that. so we bought those and then you know 2000 a month on just payments. good for three vehicles. Yeah, it kind of is overwhelming. Yeah, kind of a wake-up call, kind of thing.
So then our son, we, he was born 19, he's staying home today, but He was born 19 or 21.
. Sorry, 21. and we were like. we just want to have a good life for him, And so we just kind of buckled down before.
And just went after it. so okay, very fun. So you ran into us earlier? Yes, and then it was just added on to when I work for Strategy LLC. Yep.
Okay. It was awesome. program Haley. How did you convince him to sell the motorcycle? We didn't.
She's smiling. we got to keep them. She's right. She has her own as well. What are these married?
well, Ryan.
Her Harley. so yeah, I got a street glide and then she's got a sports car. So I love it.
You are so much cooler than I am, Haley. It's embarrassing.
Yeah,
way to go. you guys, and you're how old, 35, and you have paid for house $350,000.. Mm-hmm. How's that feel amazing?
It's just different. I mean, it's hard to imagine it really and we're we pay. we actually paid our last Payment and it was like October 1st. I think we did, and it's still not settling yet.
We had made the goal to ourselves that we wanted to pay it off by Christmas and I would be our Christmas present to ourselves. so we really cranked down and worked extra shifts, and He was working a couple of extra side jobs to make the extra money and we were able to pay it in.
October, not in December. I love it. Yeah, very cool. Very cool. Yeah, that's, it's a great place.
You're, six years is a long time to crank on this. How did you stay with it?
Well, we really were like hyper focused on in the last two years. Mainly we really enjoyed, like your podcasts and on the books and everything that we've been reading over the years, But the last two years are really when we've been cranking down and focusing on it.
A lot. a lot of our culture will tell us that success is a dollar amount. Mm-hmm, and we don't often ask the question like What, what I actually want to be doing? We just get good at something and then they reward us with money and we do more of it and we do it faster. And then all sudden we making great money and everyone's telling us look how lucky you should feel and inside you're dying, right?
Oh, yeah, talk to the person who feels like they have golden handcuffs. They're stuck because, quote-unquote, they make all this money. You look like a guy who's free, Y'all look like a family who's free and y'all made a choice to basically cut your income in half, right? We did, but it looks like it was the right thing for you, Yeah.
He's got it. I mean as long as you, you know focus and you work, and if you have a spouse, you work with them together. You have to do it both together. It can't be separate, and that's the biggest thing. We just were, we were helping each other, kind of feeding off each other, And I think that's the best thing.
or if you don't have any spouse or anybody, you got to find somebody to keep you accountable.
Some positive peer pressure with the guys at your company all doing this at the same time. Yeah.
I mean, they're actually. it's actually pretty cool because they're all know, we paid the house off and they're all like, you know. Now we want to do this to you. So yeah, You're inspiring them. That's kind of yeah, it's very good feeling.
I mean, we don't like to. you know, we're not those type of people, but it's kind of really inspiring and stuff even for us.
To be here. So yeah, there's a difference between bragging and setting an example, correct? And you just set an example. Well done, good for you guys. I'm so proud of you.
Thank you.
Thanks, who was cheering you along? who was telling you to go for it? I mean really everybody. Yeah, our whole family both sides.
My son. Yeah, her son. He's, you know, he's only two. He's just been our like emotional support guy.
Yeah, my, my dad started me a lot when he was we would drive around, He'd be listening to your podcast, and this was a long, long time ago and Just never really did it. and you know, my dad passed away in 19.. And so we, That was one thing I wanted to do is I wanted to finish this, I wanted to do this and kind of, you know For him, so yeah, absolutely.
Well, he's smiling. Oh, yeah, smiling from heaven right now. Yeah, what a way to honor your dad. Yeah, and that's cool.
Yeah, very awesome.
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Three, two.
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Hey, you mentioned something, Dave, and I don't want us to lose.
Now that that company put this, this benefit out, they're really successful. he's gonna be a better employee. He's gonna be a more peaceful employee, yep, they get to pay him less. he's gonna knock it out of the park for him.
Yep, smart dollar comm. check it out, boys.
Dr. John Deloney Ramsey, personality number one best-selling author, is my co-host. today. Dan is with us in Greenville, South Carolina. Hi Dan.
How are you?
I'm good. Hope you guys are doing well. We are, sir. What's up? So a question for you about the.
I'm on a all-commission.
position and In reading your book, in regards to the hills and valleys account that you have set up.
So I've got Myself budgeted out to the end of April and then I've got some about 12,000 extra on top of that. Do I throw that extra 12,000 straight at debt, or should I be adding another line item into my budget?
No, just a little bit. If you're in babies, are you in baby step two? Correct. Yeah, just list your debts smallest to largest. every excess dollar you can squeeze out of your budget above your basic living expenses.
You throw it at that now. Do you have any money? Do you have down months below where you never, where you don't even make enough Commission to cover your basics?
Yes, yeah, so commercial real estate. so, for instance, December Commission check was 67,000 for December, but the first, the Probably six months before that, it was zero to a thousand dollars, you know, It really varies, and so I have to budget myself out For months at a time and my worry is that I throw some extra money when I have it at some debt and Then maybe a deal doesn't go through or a deal gets extended and I there I am with a paid-off car, But I should have had money in my, in my account. So that's that's what I'm struggling with there.
Yeah, I should you know, what we're trying to do is reasonably predict the volatility, and how long have you been doing this?
Or three years commercial real estate, okay.
I mean you. you probably could get some comfort from looking at the patterns. if you went back three years, You should see a trend line up in your income. overall, Your overall income should be going up over three years. You should be making more three years in than you did the first year, right?
Correct. Okay, and you can tell if there's some kind of a rhythm at all to. you know about how often you see checks coming and going. but Yeah, you just you know the the valley account. if you're gonna have an extreme volatility, like you do, Where you literally have zero or have a thousand dollars or something?
Then you've got to set aside money for as many months In that valley account because you're in a valley To cover your basic needs till you get another check in. Yeah, that's exactly what we're talking about. So You know, there's not a. We have to, but we have to try to predict. the future is what we're doing right, which of course is an imperfect science.
but You know, if you had six months, this is not your emergency fund. This is money to eat with. Okay, this is us planning to make no money for four months. So we set four months of basics aside in a separate account. That's called the valley account.
you do that when you have a hill like December, with twenty sixty seven thousand dollars in one month. So the trick is to try to ascertain with some kind of pattern. if you look on your look-back, you know, how often am I going to have to dip into this account to eat and To keep the basic. keep the basic lights on and everything above that. then you need to dump, but you should reach a point where You're getting something every month.
You should not continue To get Z, to have zeros the rest of your life. I mean you ought to be able to get your pipeline full To where something is coming out all the time. now, it might take a little while to get there. it might be every other month or something, but
Otherwise, I'm gonna put something else in your mix. You're only elephant hunting and I'm gonna put a few rabbits in your in your mix as well. I mean, let's try to do some lease deals or something That's a little smaller, a little more quick to close that kind of thing than just selling the 35 million dollar apartment complex Or whatever. if you're only hunting elephants, you may have this the rest of your life, But, but you really do have to get some something built up to where you're not sitting around hungry Waiting on one of these checks. You're right, So I.
but the magic is to predict the future. that that's Tells you how much you got to set aside, for how many down months you're gonna have, and that's very Difficult to do in your world, but that that is the concept you you nailed it when you called in. Thanks for joining us.
Nothing quite like. Even in something as sophisticated as commercial real estate. Nothing smells bad like a salesman. That's broke. Yeah, and I.
The analogy you gave is good, and I think I could put that on everything marriages, on work, relationships, on jobs. So often we sit around waiting for the perfect situation. It's got to be a home run, or I'm not swinging the bat and you end up striking out a whole bunch, Right, or you get real hungry And then it makes you not an effective salesman. Yep, and but that elephant hunting man finding another way to get some money. That's, I was gonna ask him like, For those four months.
Are you making calls all day? Are you out surveying properties all day? And you just can't get anything, because that may not be your calling man? four months. You got nothing, and that's tough.
That's tough. Yeah, and and 135 million dollar deal does not take four months of 40 every day, every day, 40-hour work weeks, right? That's not how it works, right? It's all your. you know when you're on.
you're gonna be on, but you're not there 40 hour.
They got to talk to their team and their banker and their people, and but not for 40 hours a week for four months.
You need to have other stuff in your pipeline. And that's the nature of the real estate business. I've been in it my whole life in one way or another. All right, Deborah is with us in Milwaukee. Hi, Deborah.
How are you?
Hi there. Um, thank you for having me. Sure. How can we help? Okay, my daughter's actually Introduced me to your name in December.
Okay, and I've been listening to you quite a bit. So, Real quick, my, I'm retired. I've been retired for a while and I'm $25,000 in credit card debt, right? Yep, what was right? I Guess, as I'm listening, as I've listened to you guys the different times, and it's like, and I see that I've turned that blind eye to what was happening and and so when I just look at everything, I don't know how to start everything.
so I've signed up for everything that you have and I got the book the other day and.
But
I am 68, 68, and how much in credit card debt have you run up? 25 525 thousand? you have any money.
No, no, I mean well, you know when I um, I only have about 20,000 in my 401k, because I've messed about 30,000, because I've messed that up, too.
What are you living on? You have a retirement income from your old job?
No, that's that's done And I get 38, 79.
. That's my income every month.
And security. Yeah, that's our security. It's social security. I get something from a job that I worked for for about 10 years back in the 80s. How's your health mind?
My health is okay. Okay, my health is okay, and I have a condo.
That I own outright good that you live in, or No, I do not. I live in a home with my husband. Oh.
What does your husband make? pray tell.
He makes over $100,000.
And I'm gonna tell you I listen to you.
He and I have always been separate. yeah, not anymore. now, he's married to a woman that's got $28,000 in debt. He's 68. I thought you were a single 68 year old lady living on social security and I was about to put you to work Until I discovered you have a husband that has a hundred thousand dollar income and now I'm about to take some of his money to Pay off his wife's debt, Which is what he needs to do.
Tell Bubba to step up and take care of this and, by the way, You need to cut up your credit card sister. chop them all up and never do that again. but you guys are, You're together. if he gets sick, you're gonna take care of him and right now you're sick.
And he's gonna take care of you and y'all been playing house for a long, long time And now y'all need to have a conversation about what the back 20 years is gonna look like. Yeah, and that's gonna be all working together financially. health, wise marriage, wise house, wise. Y'all got too much money. You got a extra paid for a house over here.
You got too much stuff going around to be this broke and I'm a little scared about it. Yeah, I'm able to breathe because of Social Security. the magic. listen, the plans are important. The books are great.
Sometimes the magic is in that hard work or in that really hard conversation. That's where you are.
Yeah, you guys need to sit down, talk about this and he needs to help you. pay it off Silly to sell a condo, to pay off this when he makes that kind of money. This is the Ramsey show.
Live from the headquarters of Ramsey solutions, it's the Ramsey show where we help people Build wealth, do work that they love and create actual, amazing relationships. Ken Coleman, number one best-selling author of the book paycheck to purpose host of the Ken Coleman show, is My co-host today. Thank you for joining us. America open phones at triple, eight, eight, two, five, five, two, two, five. Ken.
long before there was a Ken Coleman When I first started this Broadcast a long, long time ago. It was called the money game. Yes, and back in those days, 30 years ago, we were on in Nashville only and a friend of mine that I had known from church put a book out helping people like you do in the career space, 48 days to the work you love. name's Dan Miller, and Dan and his wife, Joanne, have been friends of Sharon's and mine for Almost 40 years now, and.
48 days became a perennial bestseller, so millions of copies, and helped millions of people in the same space that you're in with their career and Selecting the right passion and all of those kinds of things. Dan and I were in a Bible study with a bunch of high-performing Guys, we call it the Eagles group when we met every Wednesday morning for 14 years and That group disbanded. it ran its course several years ago, about a decade ago or so, and Dan moved. he and Joanne moved to Florida and he he called me in December and told me a very aggressive cancer and He, he went on to be with Jesus last night about none 915 and so lost a dear friend and a guy that is an icon in the space that you're in for sure. Yeah, and Has helped a lot of people in that career space, so we'll honor him today and yeah, and Continue to cry and pray with his family.
and so just. incredible, incredible friend, incredible man, Great dad, great husband, too. That's what people. sometimes behind the scenes, you don't know what people are, and this guy's like the real dude.
well, you know he. I had the privilege of having dinner with a couple guys that he has mentored and About my age and just the way they talked about him. Of course, I got to know Dan was on his show and he'd interviewed Dan on my show as well. And you know, when you think about someone's legacy, It's the impact that they leave behind. it has nothing to do with the public stuff and he had a tremendous Impact there, but just the way he has impacted people for decades Porn into guys and a mastermind group.
I got to talk to two of these guys and they just they both Teared up just talking about the impact that he had had on their lives. Yeah, just what it's all about.
Absolutely quite a legacy. Yeah, I like a straight man, quite a guy. so our Condolences to our friends there and just take a second and honor the work that he had done is absolutely incredible. All right, Billy is with us. Billy is in Atlanta, Georgia.
Hi, Billy. How are you?
Hello, Dave. Hello, Ken. How are you guys better than we deserve? What's up?
well, my wife and I want to make a new car purchase for the first time in over a decade and I just want to make sure that It could be a pretty sizable car purchase. I just want to make sure that this makes sense from your perspective. We've been followers, followers of yours for quite some time now, and I would just like to get the Dave blessing, if I can.
Well, it's not something that's required for a car. I can tell you that if you've been following us a long time, You know that we don't buy new cars unless you have at least a million dollar net worth. Are you talking about new to you or a brand new car?
It's a brand new car, and the only reason why I'm calling in is because before I was about ten grand underneath The millionaire status and now, as of this morning, I'm three thousand nine hundred and nine dollars over the millionaire.
Just cross the finish line. All right, so you're ready to go on that one? All right, and you probably also know. we tell folks, Regardless of their level of wealth, not to buy things with wheels and motors all added together. That equals more than half your annual income.
So what's your household income?
About half a million dollars. Wow.
You killing it. What do you do for a living?
I'm a solutions architect at a technology company and my wife's tech sales executive at a startup. phenomenal way to go, you guys.
Well, it sounds like you're gonna be able to afford this car. What is it? What kind of car?
It's an electric SUV. It's a Rivian, and I know you're a car guy. So it goes there to 60 in three seconds.
Yeah, I know the Rivian. Yeah, I was talking to a guy bought one the other day. I parked beside him at church and I parked my Raptor beside him We were talking about. as we're walking in the church is a great conversation, is a lot of fun, But so so it's a wonderful vehicle. for I mean, if you like the electric stuff there by, I mean They're just.
it's an incredible. The engineering is very cool. What is that thing about? 90 grand, 100 grand?
Out the door with tax, title license and everything 98,000.
. Yeah, okay. All right, and I assume you've got the cash. Yes, I just crossed a hundred grand on the high-yield savings account. So I wanted to pay for everything, you know the insurance for the whole year and everything as well.
So, unless your wife is driving a hundred and fifty thousand dollar vehicle, your two vehicles would be Under half your annual income and you're over a million dollars and you're paying cash. That's the only thing we tell people to look at.
Awesome. Awesome. Yeah, and we're driving right now like a ten-year-old Hyundai and we're still gonna keep it until it dies, Just for like memory's sake. Yeah.
now I mean it's. uh, Yeah, it's. apparently the engineering on this thing is incredible. I've not driven one of them. The only thing I worry about with a brand new Manufacturer on anything is I end up owning a DeLorean or something, right?
Mm-hmm. Yeah, you know our Studebaker or something that goes out of business, you know, and and then leave you, you know They make, they make them for three years and they're gone. I don't. I don't have any reason to think that this company's gonna do that. But I'm just saying, and just as a general comment, but can you afford this?
Yes, you can afford it, sir. And yes, you should go buy it if it's what you want.
Amazing. Thank you, Dave. I really appreciate it. Very cool. That's fun.
Very fun.
He walked through. I don't get to do that very often most of the time. I say don't buy the car, Well, yeah, or sell the car, right?
Usually, when they call saying I need your blessing is because they feel like they're gonna do something stupid. That's still. yeah, Please save me. But this guy had walked right through it. I I'm with you.
I Still wouldn't just a car taste. Yeah, I would do it. I get a year old one or something like that, because it is a new manufacturer. But you know, I guess it's come with all the warranties and everything, but it's brand new. I see him driving all over the place.
They're great. They got a dealership about a mile and a half from my house. I'm downtown Franklin. Okay, so I see them. They look cool.
I'm telling you. It's a BA car, man. It'll ride.
It'll go. it's faster, zero to 60 in three seconds. It's just. it makes a Tesla. Look.
Yeah, what's the is it?
Is it a foreign manufacturer? I guess no, they're us. It's a u.s. Okay. All right.
Didn't even know. yeah, it's crazy. But man, it's expensive too. That's good. Hey, that's what he's earned.
This is why you are okay, That's right. You live like no one else. so later you can live like no one else, freaking making a half million dollars a year, Got a million dollar net worth, young guy. Yeah, but, and it saved up the cash to do it. No, and that's what he's making a big leap up, big jump from a front.
I feel bad for the poor Hyundai, for a hooptie. the ten-year-old Hyundai is gonna feel bad when the new shiny vehicle shows up, But they're gonna keep it. I like it.
Yeah, so what's the thing on the Hyundai's all getting stolen? have you seen the tick-tock thing, you know, Dave, I'm not on tick-tock, I'm not either. but I heard I don't have morning. You know, I heard it this morning in a different setting that it's hard to have, that. There's some kind of a.
This is true. a guy in the audience. Yeah, it is. It's hard to get insurance on them.
They're getting stolen because there's. somebody put out a hack on how to, how to get one started, how to break into it, And all these people are using that hack. Oh, They're stealing Hyundai's, okay, like crazy. Hmm. So you Hyundai people, be careful out there.
Wow, Wow, get the lojack. who knew, who knew? this is the Ramsey show.
Ken Coleman Ramsey personality is my co-host today. Hey folks, We want you to join us in Nashville for a brand new event that we just launched the ticket sales on. It's called the total money makeover weekend. It's gonna be May 10th and 11th. There's millions of you out there who have been listening for a while and are still sitting on the sidelines.
No more setting. it's time to do it, time to take action. in just one weekend, We're gonna give you a crash course on Everything we teach you about money and you're gonna hear brand new content in addition to that from the Ramsey personalities on budgeting, beating debt, Investing, careers and more. no matter what baby step you're on, this event will light a fire under your butt and you'll make Progress. all the Ramsey personalities, including Ken Coleman and my right, will be part of this weekend the total money makeover weekend.
It's gonna be live question answers all throughout the weekend, lots of opportunities for fun and pictures and everything else. It is a total immersion. So come join us. May 10 and 11. early bird tickets went on sale just a couple days ago at $99 and they are for a limited time.
We're gonna re. we're gonna up the prices as we go along, So if you want the best prices, you do it now. get your tickets right now at Ramsey solutions comm slash events. The event center only holds 2,500 folks. So you do need to get your tickets as soon as possible, please, for your sake, Cassandra is in Colorado Springs.
Hi, Cassandra. How are you?
Hi guys, I'm good. How are you guys better than we deserve? What's up? So I'm curious about doing a he lock to consolidate our debt, to pay it off quicker.
So we have about 55,000 that we are wanting to pay off. But what I was hoping to do was to do the he lock, So pull out the 55,000 and then do about a $400 payment a week. So it would be either an automatic withdrawal or we do. Well, automatic is easier. So if we do the automatic withdrawal And then I'm hoping it would be paid off in about three years.
Not at 18,000 a year. It won't be.
If.
The interest is 18. No.
6400 a week is 1600 a month. That's $19,000 a year times 3 is not 55.
I don't know. You might get, you might get there, but it's gonna be tough. Yeah, you'll get there, I guess, but uh, okay, so.
So what kind of debt is this?
But we've got about Just under 10,000 on a credit card and then the rest are auto loans, No student loans, and this is not including the house. So what's your household income?
Like after taxes. take home it's about 7,100 a month. Husband has two jobs and then I also work on Commission. So I get Bonuses and so whatever we get in those extra incomes goes straight to debt, but I'm wanting it to go faster.
Going faster will be about you guys, Sacrificing and cutting deeper. It won't be about interest interest rates. Not your problem when you have only a two-year or a three-year problem. Your problem is just straight cash flow, and you can increase that, of course, by increasing income or decreasing outgo, Sacrifice. the problem with it, with with moving this onto your home, is you've now put your home at risk for your misbehavior, and Your misbehavior was you bought things you couldn't afford to buy.
right and now Recognizing that and changing that behavior.
Yeah, maybe 88% of the people that do debt consolidation end up going further in debt, Not less debt, because they don't change the habits in the behavior. I personally would tell you to never do it. I would list these debts smallest to largest. I'd cut up the credit cards. I would sacrifice so deeply that people think you joined, joined a cult.
I'd sell so much stuff the kids think they're next. I'd go Crazy and get this done in about two years With your income and live on nothing. not going out to eat, not going on vacation, Not looking for an easy way out, attacking this with an absolute, freaking vengeance That's the formula that we have seen that has the most success.
Because here's the thing. debt is not the problem, debt is the symptom, and Interest rates, when you run the actual math, are not what's killing you here, especially when you pay those credit cards off really, really fast, because they're going to be the smaller of these debts, the cars are going to be the larger of the debts. and So when you list these things smallest, largest pay, minimum on everything But the little one attack the little one with a vengeance. Credit cards are going to be the first thing out the door. They're gonna be gone.
And so now your interest rates are not going to be substantially different from that point forward Between that and the haylock, and you put your home at risk to buy a car Or, in this case, to keep a car that you shouldn't have bought.
Yeah, The key that we have seen Cassandra in all these years. when Dave talks about you've heard him talk about it over and over and over again, Gazelle intensity, the word. there is urgency, and here's what happens when you take the route of the haylock, You remove all urgency. In fact, the way you laid it out to us was so relaxed, and we'll pay four hundred dollars a week and in three years We'll pay it off. and that's where the.
that's where things go right and Dave's right, and the data backs him up. So urgency is. we don't rely on the haylock. We don't rely on a steady monthly payment to get out of this. We get after it.
right now. We sell a car. if we've got some equity, we drive a Car that maybe we wouldn't choose to drive, you know, we work two and three extra jobs. we sacrifice. like they've talked about what's going on, there is urgency, and when you're your Urgency is driving behavior.
You're gonna see faster results, and that's why you should permit behavior change.
That's correct. You don't ever want to do that again. Yeah, you don't. you don't see that when you.
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