Don’t Believe the Lies, Anyone Can Build Wealth

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 amazing relationships. I'm George Campbell, Ramsey personality, joined by best-selling author and all-around good person, Rachel Kruse. And we are here to take your calls, America, at 888-825-5225..

And George, I'm going to jump in as we start the show, because it's a very special day. It is George's birthday.

George, happy birthday. Thank you. The crowd goes wild in the lobby.

Happy birthday, George.

Thank you. And thank you for this gift, Rachel. You used to leave $100 bills on the desk. That's so kind of you.

It's all prop money, and everyone thinks it's real. It's all for you, George. I got that all for you. Hundreds of dollars.

The money may be fake, but the friendship is real. I appreciate that.

But seriously, happy birthday. Thank you. And on a Friday. That's a great birthday.

There's nowhere else. I'd rather be, other than at home on vacation. Okay, there's a lot of places I would rather be, but this is pretty good.

I know. Well, happy birthday.

Thank you. Well, I'm excited to take your calls. Make them good, people. Jennifer kicks us off in Washington, D.C. How's it going, Jennifer?

Great. How are you doing? Thank you so much for taking my call.

Sure. How can we help today?

So I have. I'm a single mom. I just got divorced, and I'm working two jobs. It's okay. It's actually a good thing.

Are you able to pay all of your bills, like your four walls, food, shelter, utilities, transportation, cover everything, and have some extra to throw at the credit cards?

Not really.

Okay.

I'm barely making it. Like I juggle, so I juggle. One month I might not be able to pay the electric bill in full, so I take a hit there and then next month I can, so.

What do you do for work, Jennifer?

I'm a department supervisor for Lowe's. I got my first job after marriage. It was a very abusive relationship.

So you're new to the workforce here, stepping out. I'm proud of you. That's great. What are you making?

Thank you. I bring home, I just started bringing home around $3,000 a month, and then I work a second job as well. I make gelato on the side because it's very close to my home. I can be quick to church. I can be quick to my children's school.

Yeah, how much more do you make with the side job?

I make between one to $300 a month.

A month, okay. And how many hours is that?

That one, I work generally. eight to,

Okay.

Jennifer, when you look at all of your expenses and you're looking at even just housing, how, are you in the same place you were where you guys were married? I'm just wondering if you're, from a percentage standpoint, if your mortgage or your rent is eating up a lot. I see you're in Washington, DC, and I just know that's a very, it's an expensive area. So I'm curious that part of your budget.

Yes, absolutely. This area is extremely high. I can't move currently right now because that would take a lot of orchestrating on my part to leave. I would, it would also create probably medical, legal bills because my ex just, I've entertained the idea, he will not have it,

no matter what. So you have to stay in the area due to the agreement?

So how much is, though, your, do you own a home or are you renting?

Renting.

Okay.

What's your rent every month?

$2,850.

Okay, he pays it. I was gonna say, I can see why things are tight here. All right, so he's, how long is he gonna pay that rent for, for the foreseeable future?

He has been threatening to not pay it this coming year.

Does he have the legal right to do that?

Yes, because I was kind of afraid, so I didn't fight him in court at all. I was moving with, even putting chairs up against my doors, just, I was really afraid.

Are you safe now?

Yeah. Yeah, I think it was mental more than anything. I'm feeling, now that I'm further away, I'm gaining strength, you know, and I'm not seeing him as such a threat, but we still keep a, you know.

So Jennifer.

It's still there. Yeah.

I feel, what I would tell you after listening to your story and how fresh all this is,

It's 38,000.

So my, what I want you, I want you to have a level of security in where you're at, and doing that is making sure your four walls are covered. So when you said we don't pay the, I'm not able to pay the electric bill some of the months, those months, Visa doesn't get paid. Like, taking care of your necessities, food, shelter, utilities, and transportation is vital, Jennifer. Like making sure that those things are covered, that your lights aren't going to be shut off. I mean, these are basic needs, and those things get paid before the credit card.

It's multiple. Yeah.

But it's the total of it. I would call each of them, and I would just tell them your situation, and say, here's what's happened in the last six months, three months, a year. I'm not going to have the money to pay for this, and so what kind of plan can you put me on? I want to pay you back, that's my goal, but this is not going to get paid right now. And I would do as much communication on the front end, because again, making sure that those necessities.

You might not be able to be, gazelle, intense, like you want to be. You might just be crawling for now, and that's okay.

And that's okay. And being with your kids, healing, all of that is okay, Jennifer, for a time. So give yourself the permission to breathe, right? I mean, you've gone through a horrific, horrific situation. And so, healing from that, don't feel like you have to take on the world and do everything.

Your actual life expenses.

That's right, that's right. Making sure that those are covered. And then, if there is extra, sure, absolutely. We're going to be throwing it at the smallest debt. But I think giving yourself room to breathe and to say, this has happened, it's going to take me a minute.

Yeah, and you mentioned church. I would make sure that your church community knows what's going on and have them wrap their arms around you. See if family can help out. It's okay. You're strong, but it's okay to ask for help too.

Real money.

We'll give you real money.

Okay, so George, question, 3,000 bucks.

Okay.

If you had to give 1,000, save 1,000, spend 1,000, where would it all go?

Oh, that's a great question. Okay, to give 1,000, I think it would, if I really just generosity to a nonprofit,

a church mission. Yeah, yeah, where would it be?

You know, I'm a big fan of Charity Water and the way they do business and their mission. So I'd probably do a one-time lump sum to Charity Water.

Okay, where would you save it or invest it?

I would invest it into Mia's 529.

Oh, what a dad, dad of the year.

You know, we got to set her up for success. I love it. Because we're doing fine now and we want to make sure she's set up well. And then spending $1,000..

Yeah, where would you spend 1,000 bucks?

Honestly, my dream would be just like a shopping spree at Costco. I would buy four things and $1,000 would be gone. It'd be dead. No one can tell me what to buy.

No, that's right, and you get to go, do whatever you want.

That's my dream.

Okay, that's good.

It's a sad dream, but it's mine.

That is a, yeah.

How about you, do you have that?

I wish your dreams were greater, George, but we're gonna take them. We're gonna take them for a day.

1,000 bucks, it's not gonna change your life to spend that much money. Yeah, fair, yeah.

I would give to,

Maybe it'll buy some of those in-the-water chairs. Those are cool.

I don't know, yeah, yeah, yeah, but that'll be down the road. So that, and then spending, I would do half clothes, half two great date nights out.

Oh, that's very, I think Winston would appreciate that.

Yeah, yeah, I'm such a giver.

I should have said 1,000.

3,000 bucks goes a long way. That's legit. It goes a long way. So if you want $3,000, how do you get it, George?

Well, all you have to do is go to ramsaysolutions.

Hi, George, Rachel. I'm wondering if you guys think homesteading is at all financially viable, and if that's something my wife and I should pursue.

You called just the right people.

We just did an episode on this, Caleb.

I know more about homesteading than I legally should.

Smart money, happy hour, other podcasts. We did a whole topic on homesteading. It's become a thing. So for those of you that don't know what homesteading is, because there's some people that don't know, I think the fullest degree of the definition is that you self-sustain your life on your property.

Living self-sufficiently.

Yep, and then you're able to sell things on your property to others. So whether it's food. Crops, cattle. Cattle, meats, yep, all of that. Milk, eggs.

Beans, greens, potatoes, tomatoes, you name it.

What we've learned, Caleb, is that obviously, it's a more expensive way at the beginning, right? Getting into it, to be able to get to this point.

I do have the numbers. I pulled it up from our smart money, happy hour outline here. Caleb, what is the nature of your question here? You're saying financially viable, as in. can I afford to do this?

Yeah, well, I would definitely be curious as to what the startup costs are, but even if you guys think it is actually, because sometimes it's hard to cut through the crap on the internet of rose-colored glasses for everything.

Oh, yeah.

Well, and depending on what corner of the internet, they'll either say homesteading is the only way to live or never homestead. And so I think it's a very personal choice. It's definitely a lifestyle that it's a hard one to commit to. I don't know that I've seen a lot of people go like, we've been homesteading for 40 years, but I think as people get tired of the chaos of this world in city limits, they go, what if we could do our own thing and have a more peaceful life? So I think, as I learned about it, I was like, this makes sense.

We do not. No, right now my wife and I are in an apartment, but we've both been saving prior to being married. And so we have money to, a little bit of money for a down payment on land. But I know that homeowners loans don't necessarily apply to land, right?

Yes. And so you're gonna need not only the land, but then somewhere to live. And that might mean you build, you get an RV, a tiny home. for now, you need somewhere to live even after that land down payment. And so that's where it gets expensive.

Well, right now I'm a full-time student.

How much does she make a year?

This is her first year doing it full-time. And right now she's taking home about right around 5,000 every month.

Awesome. And then, with your divinity degree, are you wanting to be a pastor? Do you wanna be a professor? What's the goal with that?

Yeah, either pastor or.

Welcome to the club, man.

The bar is high, Caleb. I think that's great.

You wanna be a brilliant theological writer.

George just wants to go to Costco to go shopping. So, like you're in a better mind space, Caleb.

I didn't know. being C.S. Lewis was an option, Rachel. Okay, I love this, Caleb.

That's what you get to spend your thousand on is being C.

If only.

Yeah, so, Caleb, here's the deal. Here's my take. Can I just cut through it all?

Please cut through it, Rachel.

Because I do think, because I see it on Instagram all the time. And half the time I'm like, should we just sell everything and move? Like, I mean, right? Like, I think we all get to that place. But what you're watching, if they're really doing it, is like really hard work.

And you gotta know what you're doing. You're gonna have a steep learning curve.

Oh my gosh. I'm like, there's just a lot that goes into it. And like anything on social media, including money, stuff, including investing, all of it, it's just like, oh yeah.

It's not a big deal. It looks a lot sexier and easier than it is.

Yeah, we just do that. Where I'm, like, go get some city chickens and like four box gardens and like start there.

You know what I mean?

And if you're enjoying that, then-.

Head to the Amish part of town, go on a camping trip and see if that fills your cup.

Make another step, but start small. And I think some people are like, we wanna just go all in. And from a financial standpoint, it's just expensive to do that. So if you baby step your way in and you still enjoy it, then that could be a lifestyle. But then you could get four years into it and be like, oh my gosh, we have kids, we have this.

Yeah, especially if your careers are tattoo artists and church pastor. That's a tough one to live out in the middle of nowhere and do. So a lot to think about. Don't wanna dissuade you, but I would say it's a not now, right now. Thanks for the call.

Hey, George, happy birthday.

Thank you so much, sir. How are you doing?

Doing well. Just figuring out how to get out of this mess that I made.

Tell us about it.

All right, so in total, I have about 53,000 in debt and about 38 of that is in a HELOC. I got 10 or 9,000 on a new roof, 4,000 on a credit card and about 1,500 in medical debt. I just finished up Baby Step One and I'm looking to tackle all of this. But I guess my concern is that with my HELOC, it was a 100% loan to value. So the interest rate is a lot higher.

Is that variable? Because generally these are variable.

Well, actually, I'm not sure. I actually think it might be a variable.

Because HELOCs are generally variable. The home equity loan is generally gonna have a fixed rate. And so that's something to watch out for as well with these awful traps. Yeah. It can go up from.

Yeah. So I guess, like, does the Baby Steps still apply? with how much I have in the HELOC? Does it make sense for me to attack that one first so that I can get rid of the most amount of interest payment per month? Or, I guess, like, what would you do in this situation?

Well, when it comes to the debt snowball, it's never been about interest. It's about knocking out debts fast, motivation, progress, momentum, and actually getting to the finish line. So, when it comes to HELOCs, our one parameter when it comes to the debt snowball is if the HELOC is greater than half of your annual income, we can push it to Baby Step six when we're paying off the mortgage. And if it's less than half our annual income, it can fall into that debt snowball wherever it would fall. So what is your income?

I think after taxes, it's about 65,000 a year. Yeah, I'm an engineer.

Okay. And so before taxes, I assume it's like 80 something.

It's actually about 70, I think it's 73.

Yeah. So you're right on the cusp there. I think this could go either way because of its high interest. I think you can just put it in the debt snowball and attack it aggressively, but you're gonna need to up the income. Do you have a spouse that's working outside the home?

No, she stays at home with our four kids.

Okay.

Yeah, I mean, you could look, Clark, into refinancing. Do you have a good rate on your mortgage? I'm assuming, interest rate.

Yeah, I have a 3%. Yeah.

I was gonna say, looking at that, possibly refinancing, and just rolling this into that. Yeah, just for the interest.

I mean, even a personal loan, would probably have better rates than you've got on this HELOC, but I don't know if you're gonna be able to pull that off.

What about, so I'm close to the 80% value loan to,

I'm not sure what they'll be able to do for you. I mean, if they can negotiate and go, hey, I need a lower rate, this thing's killing me, I wanna pay it off, but this interest is making it really hard. I don't know what they're gonna say, depending on the company and, you know.

Yeah, and where you got it. Yeah, you could definitely ask Clark those questions.

They're not gonna raise it because you asked.

Right, right.

Okay.

But no, I would still stick, though, with the methodology of just paying off. You'd pay off the medical debt, the 1500, first, and I would just, I mean, I would go down the line, honestly, still with that, even though this is a huge loan with a really high interest rates. I think getting those other things out of the way is gonna help free up some of the income of those minimum payments that you would have been paying, once the smaller debts are paid off, to keep aggressively tacking it. But again, I mean, I would run some numbers and just say, okay, for, you know, again, I don't want you to lose the great interest rate, because how much do you owe on your house?

Just about 300.

You owe 300, okay. No, I wouldn't do that. Okay, so yeah, it would just be you guys just tackling it. I mean, slowly but surely you're gonna be paying it off, but I think upping your income, Clark, is gonna be really big for this season. And I would map out too, I think what's helpful during this process is to say, okay, what if I made an extra 1500 a month or 2000 a month or, you know, like some number that would require some sacrifice, you're gonna feel it, but how much faster would we get out of this, right?

Yeah, the magic word is margin here. So you can only define that two ways, is making more and spending less. And I would try to do both aggressively to see what kind of margin you can create.

All righty.

But man, this is a, what'd you use the HELOC for? Curious.

So I got frustrated with all the student loan crap and I was like, I don't want to deal with that. And I was debating about buying an investment property. I was just trying to do all the things all at once. And then I was like, I'll just wrap it all up and pay it off in that way, so.

So you paid off your student loans by moving it to a higher interest debt.

Yeah, probably one of the dumbest decisions I've made.

And so, hey, we've all done with zeros on the end. It's only really stupid if you do it twice. And so you've learned your lesson here. It's a stupid tax.

Clark, we'll do this again.

Yeah, and unfortunately you realize that moving debt around doesn't actually solve it. And sometimes it makes it worse. Like in this case, it's one of the reasons I hate HELOCs with a burning, undying passion. And they're marketed as these wonderful tools to set you up for freedom and help you do all these things. And it's just not true.

Okay.

Yeah, that's what we do around here, Rachel. We just, I feel like a doctor who just gave me the diagnosis and I'm like- I know.

I'm like, bye, Clark.

Have a good weekend. You got gout. Have a good weekend. Best of luck with that. I know.

And it sucks too, because so much of personal finance, it's so personal. And so much of it, it's for the most part, it's us choosing it, right? Like when there are bad money decisions or choices, it's because we made them. And so I think part of it is swallowing that pill of like, well, crap, I did this to myself. Like I did this, you know?

It's rarely been like, well, I got a $2,000 raise over those two years. That's right. They increased it double. Yeah.

I mean, like some people, or they find even a whole other job for it. So anyways, it's just, it's still doable. So don't lose hope, Clark. I mean, we see it, but it does, it takes some work. But map it out.

The year is gonna pass either way. So where do you wanna be a year from now?

That's right, exactly.

But in that moment, you're like, oh my gosh, a year of sacrifice. It feels like yesterday, it was 2014..

I know, it's just like yesterday. Last year you felt 20, you felt 34, George, and today, you're 35..

You ever just wake up with a back issue and a crick in your neck just from sleeping?

I know, I hear you're 40, as it gets worse. I don't know, neither of us know, but we hear that.

Looking out to a 40-year-old right now. Well, that is how it goes.

Do you hope Randall calls this hour?

If Randall calls, I will lose my mind. If you all know about Randall calling the show last week.

Randall's a birthday appearance. I don't know, we'll see.

Only time will tell.

Vivian may have a inside, inside, but we'll see.

One of the reasons to stick around on the Ramsey Show. We'll be right back.

Yes, he asks, I am getting a 15-year mortgage and want to pay it off as quickly as possible. What's the best way to do that? Should I make an extra payment of as much as I can afford once a month, or is it better to pay a lump sum once a year? Ooh, first of all, Greg,

I love that you went with a 15-year mortgage, a very difficult choice in today's mortgage environment, but it's the right choice because you're gonna save so much on interest. You generally get a lower rate than a 30-year. You're paying it off, in worst case, 15 years, which is beautiful. And he wants to pay it off quickly, which we found, Rachel, in our millionaire study, the average millionaire paid off their home in 10.2 years. The average baby stepper following the Ramsey plan pays off their house in seven years.

Seven years, I know.

So it's incredible. And the way they do it, if you're asking here, should I make an extra payment as much as I can afford once a year? There's all these TikTok strategies that are stupid out there. And the simplest way is, when you have the money, pay it toward the principal. And for us, when we did this, it was every single month.

Extra, yeah.

And if we could even up that goal every month, it was even better. So it might be right now, extra 500 bucks is what we can do. It might go up to, we're gonna double the mortgage payment every month. for the year. You might even get the triple, depending on what your mortgage is.

Yes.

So it doesn't have to be gazelle intense, but I like having an actual payoff date goal. And if we do that, we need to pay this much off. Very similar to baby step two.

Yeah. Well, it's almost like pay yourself a car payment, right? Like an $800 car payment, what you would have paid if you were still living in debt. And just, I think, having even that, some type of picture, yes, in it. But yeah, it going to the principal and doing it.

If you're like, I'm gonna save this up over the year.

And then you think, oh, well, the beach kind of sounds nice. What if we just took a little bit of that that we would have put toward the mortgage and used it, or we need to upgrade this, or we want to do that, you know, and there's a bunch of cash there. It's a forced savings plan. It's a forced savings plan. It's a great way of putting it.

So I like the strategy. And again, just like baby step two, you got to find ways to have more margin. So if you're only able to throw a hundred bucks, we got to figure out how to make more by spending less or getting a side job, increasing our core income, all of that. But man, it feels good. Once you see that principle, go down, look at everyone listening out there, go look at your amortization schedule.

in interest alone,

just by not giving it to the bank and paying this down sooner. And once you start to flip-flop the principle versus interest, you start to see it shift where you're now paying more in principle than interest. You feel like you can do anything. So good luck, Greg. Call us when you're debt-free.

Hey guys, thanks for taking my call.

Absolutely. How can we help?

So yeah, my husband and I are starting a side hustle to like pay off debt and grow wealth and stuff. And we kind of, we're not sure what to do with the SUV. We have, it's the last debt we've got besides our home. And right now we're paying $2,000 a month on it.

What do you mean the future?

Well, we make really good money right now. And we don't want to jeopardize that with the side hustle, but we also want to do the side hustle to make more money. And, and, you know, and that's, we, you know, going to real estate, you know, buying and selling properties and things like that.

So what are the kind of boundaries with the side hustle? What would cause you, what would cause it to affect your jobs?

I just don't think they would appreciate, you know, just, I feel like they might worry about it, taking away from, you know, our job and stuff like that, which we wouldn't do, you know,

are you at work present for the amount of time required? Are you getting your work done? Is there a non-compete that you signed?

Right. We would, yeah, there would be no issue with that, you know, or anything like that.

And have you spoken to your leaders at work about this and saying, hey, we're trying to get out of debt. Here's what we're doing.

I know. Now we thought it would be best to keep it on the down low.

What are you doing?

What are you doing? What do you do for work Autumn? And what's the side hustle?

It's a food service administration. And the side hustle would be a real estate broker.

Those feel very drastically different.

Have you done, have you done the side hustle? Have you guys been doing real estate?

Not yet.

Oh, so it's just a dream.

We've done all the classes. Okay. Well, we've done all the classes and everything like that.

Did you get your license? Did you get your license?

Right, yeah.

Okay.

You do have your license.

And do you have your, do you have your broker's license? And what are you planning on doing with it?

Selling real estate.

Just as a independent agent within your own brokerage?

With a firm.

Okay. Well, number one, real estate is, it is hard to do part-time as like a side hustle because of the amount of time it takes, the random schedule and hours. The good news is you can try to schedule around your, you know, is this like an eight to five type job you have right now?

Right, yeah.

Okay. I mean, I think, as long as it's not affecting your actual work and productivity, there's nothing wrong with this.

You're saying you're making great money. You said that earlier. Is that through your main job? Obviously.

Right. Right. Yes. Okay.

But you don't want to do that long-term. You don't enjoy this work.

Partly. It would be great to be able to do both. You know, because, you know, once upon a time we talked about buying a second property where we like to vacation, and, you know, financing and whatnot, and decided not to do that, you know, after listening to you guys. But, so we'd like to pay off our mortgage and then, you know, purchase other real estate and whatnot, either to flip or, you know, to rent.

You're excited about the idea of working in the real estate world. Yeah. What's left on the SUV?

38,000.

38,000?

About 29,000.

Oh, you said you had enough to pay off the car today.

Well, yeah, in one account we have that. And then another one, we've got about 18,000.. So, I mean, we could pull from a couple different accounts.

Well, I'm going to encourage you, regardless of the side hustles, I would pay off the car today. You guys don't have, you know, super unstable jobs. where you're about to lose your jobs tomorrow. I would go ahead and pay off the car today, quit paying interest, free up the car payment. That's going to put you in a much better position and allow you to not have to work the side hustle.

Yeah, how much do you guys make a year, Autumn?

It's about, it's a potential about 295 gross.

Potential, is that what you?

165, that's what's a potential bonus and whatnot.

Well, here's the key. Making 165. with no car payment, you're going to be able to save up that savings really quickly, because that would put you in baby step three, where you save up three to six months of expenses. So, I wouldn't go through all this hassle of trying to sell a house, to pay down the car faster. You have the money, just be done with it and move on with your life.

It's like 700, but we're putting 2,000 on it.

So, if you put 2,000 instead, you free up the car payment and put that money instead toward a savings account, you're going to be back there in no time.

Sure, sure.

And you can probably do even better. I think if you guys are really on a tighter budget and I feel like there's probably some money leaks happening right now, you could get rid of that. You could get that savings really fast.

Yeah, and I would suggest to pay it off, so you don't feel like the side hustle has to be to pay off debt. That kind of frees you up there. And then, if you guys want to transition into a real estate career later on, you can start taking those baby steps to do that. But I wouldn't let the motivation of the SUV be the driver of getting into real estate either.

Pay it off. That puts this hour of the Ramsey Show in the books. Thanks to my co-host, Rachel Cruz, all the folks in the booth keeping the show afloat, and you, America. Thanks for listening in. We'll be back before you know it.

Big question mark, but it is fun.

And our recent episode was all about how birthdays and parties and gifts have gotten out of control in today's world. That's right. So it's a fun one.

Are you setting me up for a birthday?

I'm not doing anything.

Happy birthday to George, though.

Thank you.

Because it is his birthday today. George, happy birthday.

I thought it was apropos, after Smart Money Happy Hour released yesterday, the birthday. We're on the show. There's so much. So much happening. The stars have aligned.

So much is happening, so great.

Give us a call, 888-825-5225, and we will give you our best advice. And remember, it's free. So take it all with a grain of salt. Olivia kicks us off in LA. What is happening, Olivia?

Hi, thank you so much for taking my call, or my question. And my question is, to give a little backstory, my husband and I, we got married very young, with little knowledge, or actually no knowledge, of how to handle finances. And we've kind of stumbled through life, through marriage, through children, through buying our house. And although we've always wanted to tackle it, it's kind of complicated, because when we do discuss it, we get into arguments of, well, you bought this, and you did this. So I've kind of had a hard time communicating with him.

Mm, yeah, it's difficult. And a lot of couples find themselves, Olivia, in your exact situation, because it is a touchy subject. And especially, you just said, we got married young, and we're just kind of getting through these big parts of life. And what we find, Olivia, very often, is that it's not usually a money problem. More than likely, there's a marriage issue going on.

Right, I would agree with that. And I've also suggested that we seek marriage counseling. And he's kind of just like, well, he doesn't say, yeah, let's do it. He's just like, huh, and then changes the subject. So, at this point, I'm like, well, if marriage counseling's not important, or you're not recognizing that we need it, how are we gonna move forward?

Yeah, yeah, and I think that's where a lot of people find the fork in the road of just this idea of, oh my gosh, is this kind of the reality of where we're at in our relationship and in our marriage? And when one spouse is wanting to work on it, and do it well, and the other spouse seems to just be apathetic to it, it's very hurtful, right? It's very hurtful. It feels like a level of rejection. You're probably asking yourself, am I not worth putting the work in and actually having effort towards this?

Have you shared that with him, like what Rachel just said? The kind of the gravity and depth of this, of how you feel about it?

Not in those exact words, but I have had conversations where I feel that I could get more input and I just don't see the effort. And it turns into, well, you're always unpleasable. You know, anything I do doesn't satisfy you. And I've come to think that maybe I have extremely high expectations.

No, it's his immaturity.

It's that, but also-.

He doesn't wanna change.

The way you're confronting him, though, Olivia, it is pointing fingers. I want more input from you, and you, you know, to him. And I want you to stop saying what you want from him. And I want to start talking out of Olivia. What is Olivia feeling and what does Olivia want?

Especially when they've had a pattern of doing things a certain way. That's right. It becomes even harder to change. How long have you guys been married, Olivia?

It's gonna be 20 years in January.

Oh, my goodness. And you know what my therapist calls it? Cause we go, I mean, Winston and I, we do marriage counseling. We do individual therapy. We do, I mean, like.

We're back here again. You're so self-aware. You can see it happening.

And you can pause and use new tools that you've learned, because we're all trying to, you know, in some ways manage our way through life, right? And so there's things that you've learned to protect yourself. I mean, I mean, there's a lot there. There's a lot there, Olivia.

The way you grew up, the way, you know, the mistakes you've made.

And then, once you guys start those healthy patterns on your marriage, then suddenly, when you're like, babe, the money is stressing me out. He's able to be like, okay, I hear you, because you're using a different way of, you know, different language, different tone, different approaching, all different ways of life. But again, Olivia, just like so many people, I really, I would encourage you guys, it's a marriage thing at this point. But to give you a quick, you know, you call it into a money show. So, and I'm not a therapist.

Yeah, when he hears your input matters, it's a different conversation.

That's right, yep. Instead of, you know, pushing the blame. And hopefully that's a good jumpstart on the money conversation. But again, I think the marriage piece, it's big. I mean, working on that.

Getting a spouse on board is one of the hardest things you'll do in a marriage, but it is worth the work. And that might mean, hey, we're going to listen to Smart Money, Happy Hour. This is a fun podcast. Then, hey, what if we took financial peace university? That may then lead into counseling down the line, as he sort of warms up to this idea and realizes he's not the villain here.

I'm sorry, we have like warm cookies. And Melissa just gave me one at the break. That's so great.

That's the kind of service you get around here. And it's a friendly reminder to come visit us. We love, I'm looking at a lot of beautiful, friendly faces from around the country, sometimes around the world. And the show is free to come watch on the glass. if that's your, if that's, you know, really gets you excited.

Nashville is a destination city anyways. It's such a fun city if you visit Nashville. And we have so many people that come for like a long weekend and we're one of the stops.

Or you stop by because you're traveling. South or North, and Nashville is a great pit stop. So come see us. You'll get free coffee and free cookies.

Which I'm indulging in right now.

She didn't pay for that. And you're not gonna pay either. We won't allow it. So let's get to the phones. Adrienne is up next in Asheville, North Carolina.

Hi, thanks for taking my call. Sure.

No, Adrienne.

No, what did you do twice?

Well, I was in debt. My husband and I claimed bankruptcy in the end of 2020..

Yeah, I'd probably sell your house regardless, because being a long distance landlord's really difficult. But Adrienne, tell me what caused you to go back into debt?

Well, we decided to move up here. when I finished nursing school. My husband said, you know, we could use a fresh start. You can literally get a job anywhere once you're a nurse. Let's move.

I'm sorry.

And not knowing anybody in the area, like I, just kind of coped by spending money on like everything and anything. You know, $200 pair of shoes, $100 lunch out, like you name it.

But your life's not working out wonderfully.

No, you're right.

How much debt are you in?

So in total, including the mortgage down there, about 225 to 230,000.

What's not the mortgage? What's just your consumer debt?

So the mortgage is about 67, so about 160.

And is 160 mostly credit cards or what's in that?

No, so about 97 of it is student loans.

Okay, okay.

I think about 200 is what we could probably get for it.

Okay.

You could walk away with a little over a hundred.

Yeah, yeah.

I mean, so, Adrienne, I mean, I, yeah, I would do that regardless of where you were financially. I think it's gonna be really wise for you to do it because of where you are financially, but also recognizing that, you know, so much of personal finance, it's behavior, right? And it's us that is, you know, we talked about this in an earlier segment. We make the choices on what's going on with our money. And so, understanding, Adrienne, that things within you, recognizing those things and healing and putting better money habits in place, better boundaries for yourself.

Is your spouse on board with this plan?

My spouse kind of leaves things up to me.

Oh.

Your spouse what?

They kind of leave things up to you? Like, so if you said, hey, I'm gonna sell the house, I'd be like, okay, whatever you wanna do.

Yeah, basically, I know that's crazy.

How much, do they have any debt?

I mean, that debt's like ours combined.

Okay, I want them to care more than just going, eh, whatever you wanna do. I want some buy-in here. And so I think you need to lay out everything together, all the debts, all of the income, create the budget and go, hey, here's where we're at. Here's a state of the union for our house. And part of the plan is selling this house.

I would say about 160,000.

Okay, I was almost spot on, that's amazing. I just had a feeling. And both of you are working full-time.

Yeah.

So think about that. You clear all of your student loan debt, sell this property, you're making 160, how quickly could you pay off another 60?? Freeing up all those payments. It's gonna happen like that.

Okay.

Sorry, I can't hear you, Adrienne. Speak directly into your phone.

Oh, I'm sorry. Can you hear me?

Yes.

Okay, we also have a daughter who is graduating. In a couple of weeks and is wanting to go to college in the fall.

Okay, have you talked to her about a plan to do that without debt?

Not really.

Okay, well.

I'm not sure how to approach a plan for that.

Well, step one, you can go watch Borrowed Future for free on our YouTube channel. And that will be a great conversation starter. We'll lay out all the facts. We'll lay out all the stories, the inspiring ones, the heartbreaking ones. And I guarantee she'll have questions at the end of that and say, oh gosh, mom, I don't want that to be me.

And Adrienne, I think it's a very honest conversation too of what debt has done in your life. It's created stress. It's created a wedge, possibly within your marriage. I mean, this is like, it's not produced good fruit in your life, right? It has been harmful.

Welcome back to the Ramsey Show. I'm George Campbell, joined by Rachel Cruz. Open phones at 888-825-5225.. Well, Rachel, we got a lot of questions about investing. The social media world, young people, all they want to hear is about how to build wealth.

Great conversation to have.

But there's so much noise out there. It can be overwhelming. You can get sort of paralyzed, a paralysis analysis. And a lot of people end up doing it, doing nothing, because they're scared of doing something, but doing it incorrectly. And so I want to set them free today with some teaching on this, on kind of the primer for building wealth.

Investing, yep.

Make sure you knock those first three out. Otherwise, it's gonna be much harder to invest. You're gonna add a lot of risk and stress into your life. But once you're there.

Well, and even those who are investing now and still have consumer debt, when you're paying off debt, we would even say to pause investing too. So truly, those first three steps are just like one at a time. You're doing nothing else but those. But then you get to baby step four and you get to start investing.

You start building for the future instead of paying for the past. Yep, that's right. So this is where it gets exciting.

Yeah, so the first thing to really think through is what are your goals? What are you wanting to invest for? Are you investing for retirement, knowing I'm not gonna see this till I'm 60 years old and I'm putting money away because I wanna retire at 60 and be able to cash everything out and be great or not cash everything out, but live off those investments. Is it that you wanna maybe open up an index fund or a mutual fund and put some money in month to month because you're looking out in the future and you're like, yeah, we'll probably be putting a down payment on a house, maybe in four to five years. I don't know, but I wanna be able to get to that money without penalty, so I'm doing that.

And that why will keep you focused and eye on the prize instead of sort of getting a little starry eyed or pulling your money out when you go, oh no, this is for this purpose.

Yeah, because, just so you'll know, we define investing as five years or later, right? Or longer, that's investing. for us. Savings is more short term. You're saving for something in the next month, two, three, four years.

That's because there's less risk for you to lose money in the short term versus long term. We know you're going to make it if you do it the right way. So the next step, once you've decided on your investing goals, you gotta figure out how much you're going to invest. And your goals will determine this, but we recommend, at Baby Step 4, putting away 15% of your gross household income into tax advantaged retirement accounts. So, simply put, this would be, I've got a Roth 401k at work.

Yes, and then also understand your investing vehicles. So you were just saying that, George. So when you're thinking about retirement, you guys do some research and figure out, okay, at my workplace, do they offer a 401k or a 403b? These are great investing vehicles to be in. Or is there even a Roth option within it?

And anyone can do that with earned income. So that's a good clarifying point. You're like, my employer doesn't have an IRA. That's outside of your employer. So 401k, 403b, those are employer retirement plans.

I think $7,000 this year in 2024 that you can put in. So they limit it. But again, that's another one. And so, you guys, you can sit down with somebody, a Smart Investor, Pro or someone to open up, especially something like a Roth or mutual funds or other things. But you can also go to Vanguard and say, okay, looking into options.

You need to buy funds with it.

That's right. There's an extra step there. So just remember that.

It's just like a shell. You have a shell, but now you need to put some stuff in there to allow it to grow. So that's where it comes into choosing different types of investments. We've all heard of stocks and bonds. Our favorite of these is mutual funds or even index funds.

And we may be beating a dead horse, as they would say, George. I've never done that. But again, we're getting very simple here with this, just so, but we want you guys to know this. Yeah, George does. He loves horses.

Alive or dead, I wouldn't touch one.

Oh, my gosh.

Yes. And so the next step would be picking an investment strategy. And we've mentioned that good growth stock mutual funds, that's the way to go to invest for long-term, consistent growth. You're spreading that out among a lot of different companies. And even then we recommend four different types of funds.

That's right. And then next, that'll be opening the account, kind of what we were saying earlier. So you're gonna go and talk to your employer at work, and then you're gonna do, remember this formula, Roth, no, wait, match. Hold on. Oh no, I just messed it up.

Roth. Nope, match. Start with the match.

Thank you. My gosh, match beats. Roth beats traditional.

We got there.

Oh Lord, have mercy.

Five words.

On my soul. Match beats Roth beats traditional. So remember that formula, because that's gonna help guide you to say, okay, what should I do first? So again, go up to your match in your 401k.

If there is one.

If there is one. And so say it's 4%. Well, you have 15% you got to invest in. So you're gonna put that. So.

11%.

If you max that out. Yes, good Lord.

It's okay. The cookie is messing with her.

I mean, I get an Americano, I get a chocolate chip cookie and I go downhill. That's right, 11% left, go to your Roth. And if you max it out and you have more percentages left, go back to your 401k. But the beautiful thing would be a Roth 401k.

That's what we have at Ramsey. And so for a long time, that's what I was doing. It's just Roth 401k, all 15%. We've got good mutual fund options. That's the key.

Yeah, because in our world today, I mean, there's some stuff. I mean, Vanguard's a great example that you can do on your own, right? I mean, very much so. But even if you do that, you guys, having somebody in your corner, and this is what Winston and I do, we meet every January with ours to look at everything. They're looking at your entire financial life.

Get that third party in there. So if you wanna learn more, we've got a great article that we'll put in the show notes in the description that explains it all. It's called How to Start Investing, and it's on the Ramsey Solution site. So go to the show notes, click the link in the description, and it's all free. We just wanna help you guys build wealth with peace and confidence.