Get Up Off Your Butt and Live Your Life!
2024-07-09 01:59:25
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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. Open phones this hour at 888-825-5225.. Number one bestselling author Ken Coleman, Ramsey personality, and author of the latest bestseller, Find the Work You're Wired to Do. Ken is my co-host today. Fresh back from doing your Jim Cantore impression, he was in Barbados with his family, just in time for the hurricane to hit.
So exciting. So you're a hurricane survivor now.
I am. Very excited. Thankfully, it went south of us, about 100 miles south of us, and so we didn't have too much of an issue with it.
If you watch the news, it blew Barbados away.
I know. Well, it was terrifying to everybody else, but me, and I got in trouble in my own house.
Are you storm dad? Do you go out and stand and watch the storm outside? Are you storm dad?
I had the sliding doors open.
Sliding doors. Glass sliding doors.
Yeah, I had them open until about midnight as it approached, and they said it was going to hit the island at about, or it was going to come close to us. At this point, we felt pretty good. It was going to go south of us, but yeah, it was freaking the kids out. But I was enjoying the blustery winds at that point, and when we lost power at 2.30, everybody else was a little freaked out, and I did go outside for a bit. Because at that point, it was tropical storm winds, I wasn't in danger, and I am the guy who does stick his nose out there to see what's going on.
I'm a little curious, probably too curious.
I'll stand in the middle of the street watching for tornadoes. I'm storm dad. I'm like that too. My kids call me.
Yeah.
Very much. Consequently, I've got...
What does that say about us?
I don't know. We don't... I mean, you just called a hurricane blustery. Well... It's what you...
I just heard that. Well, it was a tropical storm. Please note, Ken Coleman thinks a hurricane's blustery.
No, it was in our neck of the woods. It went south of us. For the record, I grew up in Virginia, on the coast, so I've been through these scares my whole life, so that's why the pulse rate was pretty low. But I will tell you that anything 80 to 100 miles away, you're not in danger. Meaning the outer band of the storm, nobody cares.
This is by Jim Kidder. The outer bands, the right side of a hurricane, is always the most dangerous, so when you're about 80 to 100 miles out, there's really nothing to be scared about. And so I wasn't. I was watching it. I was paying attention.
But my wife pulled me aside at one point. By the way, Sharon, Ramsey and Stacey were texting. Sharon was checking in on us. Dave not worried about me at all.
I just emailed and said, are you alive?
I know. It was funny. I appreciated that. But Stacey pulled me aside and said, you need to be more sensitive to the kids' fears. They were irritated that I was so calm about it.
In other words, dismissive.
You should add to the drama.
That's not the dad's job. Thank you. It's not the dad's job. to add to the drama. Which I did.
Unless going outside and getting conked on the head with a palm tree, because you're standing outside in the middle of a hurricane.
Well, you'd be proud of me. I did call the property owner and I introduced a new concept to them. in Barbados. I said, do you board up the windows? Our master bedroom, we had rented a house and it had glass windows.
Everything else had wood shutters on it, so it was fine. And he said, we don't do that here. I said, well, listen, I'm not going to ask you to do it. But I think for the people who own this property, they'd probably appreciate it. And two hours later, Dave, plywood going up on the window.
So I introduced a, this is what we do in Virginia.
You made Home Depot Barbados some money. I did. All right.
So I did introduce that and I told the kids, we're fine. We've got the windows boarded up, so everybody can relax.
I love it. Ginger's in New York. Hi, Ginger. Welcome to the Ramsey Show.
Good afternoon. How are you?
Better than I deserve. What's up in your world?
I'm from, of course, New York and I have an opportunity, I can't afford my lifestyle here and I do have an opportunity, another job in another state down south. Being that I'm, you know, currently that I'm in a lot of debt at the moment, I just was trying to get, you know, a little understanding of what your viewpoint might be. Do I stay in my city that I'm comfortable with, or do I now relocate again to-?
You can't afford your lifestyle.
No.
How is that comfortable?
It's not.
I think you're professionally comfortable is what you're saying. Is that what I'm hearing? Yeah. Yeah. Let me ask this.
The job down south, does it forward you in your career, or is it a complete pivot?
It's something I did previously. It would be children's services. I've done children's services before, not saying I will want to do it again. I am in school for court reporting, so that's something I am gearing towards.
So do they have court reporters in the south?
They do, of course.
Okay. And so how much of a pay bump would there be if you go down south?
No. I don't know. New York.
How much more money would you be making if you take this new job in the south?
No, I wouldn't be making more. I'd probably be making maybe almost the same.
But the cost of living, how much have you factored in, cost of living being less?
Yes, I have factored, cost of living being less.
How much new margin, and I'm talking about real money in a budget, would that now present to you? if we take this job each month? You would now have this much more money because of cost of living reduction. What would that look like?
I think there'll be at least $400 to $500.
It's a no-brainer. It's a no-brainer for me. I'll tell you why. You're in school to be a court reporter. You can't afford to live where you are now.
You're not going to stay in the career that you're in in New York City. Let's go, reduce our expenses while we're getting qualified. Maybe even have to press pause for a little bit on the court reporting school. That's a possibility to press pause, because then we get our mess cleaned up from the debt standpoint, create more margin, and I can pivot into court reporting in the south. Or, if I want to come back to the northeast after I've got my mess cleaned up, then I can do that.
But I just think going south right now is a great option for you.
Yeah, you got, ginger. You called me up and said, Dave, I'm drowning, but the water's warm.
That's right. Right.
Yeah. No. You're gone. Okay. You've set out.
There's just a little fear, insecurity, and change is always difficult, but also sinking and drowning is difficult. We're going to choose our pain here, and we're going to choose pain that has a good upside, and it's not that painful. So yeah, I think you've identified correctly what you've got to do. You opened your first line. when I picked up the phone was, I can't afford my lifestyle.
And so that means something has to change, because you're not in Congress, so you can't print money, so we've got to have some other game plan.
And so Ken's exactly right. And hey, here's the other thing. Always remember, none of this has to be permanent. That's correct. You can go south, have an adventure, get your income way up, and decide you want to come back to New York.
There's nothing wrong with that idea, but coming back to New York with a victory parade, where you then can afford your lifestyle. And because you cleaned up the mess, got the income up, got the career shift done, and did all of that in a cheaper, cost-of-living area, and got your foundation. So it's not as if this is a decision that has to be a permanent decision.
You don't want to jump and move every three weeks. It's expensive emotionally and financially, but sometimes folks go, I'll never be back. Yeah, you can be back. You just decide to. This is the Ramsey Show.
This show is sponsored by BetterHelp. This is Deloney, and I'm always railing against social media, especially in the summer, because everyone uploads the highlight reels of their perfect bodies, and perfect vacations, and perfect kids. And I know they're not real, and I also know that I'm blessed beyond my wildest dreams, but I still find myself wishing my life was like other people's. And, based on the data, I know this is happening to you too. Comparison is wired into us, but comparison can also become the thief of joy.
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Ken Coleman Ramsey, personality, is my co-host today. Malachi's in Tucson, Arizona. Hey, Malachi, how are you?
Pretty good. How about yourself?
Better than I deserve. What's up?
Well, I have myself in kind of a financial hole that I'm finding harder to get out of than I expected.
I have debt that I'm trying to get rid of, but it just seems like it's not getting anywhere.
That's no fun. How much debt have you got, brother?
I have just about $260,000 in debt.
Okay, give me a little breakdown on that. What's the categories?
So $250,000 of that is my house and the other, I'd say about $10,000 is money that I owe family.
So you don't owe anything on a car or a credit card or a student loan?
I do owe $4,000 on my car.
Okay. Alright. And what else? Anything else?
No, other than that, that's it.
Okay. And so what's your income, sir?
My income is at $90,000 per year right now.
Okay. So why can you not pay these bills with $90,000??
Well, I've been eating away at the debt of my home. Just over six months, I've paid $110,000 of it.
That's far from being stuck, sir. That's actually incredible progress.
Yeah, it just doesn't quite feel that way. I have no money in the bank.
Well, you paid it all on debt.
Yeah.
Yeah. I mean, you're not going to have money in the bank until you clear the debt. So I would back up and knock the $4,000 car debt and the $10,000 family debt out next before I pay any extra on the house. And then I would put an emergency fund in place of three to six months of expenses. And so I'd put $15,000 in a high-yield savings account that's sitting there just for emergencies.
And so I just gave you $30,000 worth of an assignment. How quick can you knock $30,000 out?
Well, I would have to figure about six months, maybe less.
Yeah. That sounds right. Because you're living on nothing. You're game on. I mean, you've not got any lifestyle eating this up, or you wouldn't be making this kind of mathematical progress.
Yeah.
You're already pretty stinking, frugal, aren't you?
Very much, so, yeah.
I'm thinking.
Basically, top ramen every day.
There you go.
Yeah. I got a different word for you, Malachi. You don't have an elimination problem. You have an allocation problem. And our baby steps, the snowball, is where you start here.
And all of a sudden, this momentum is going to just be unbelievable for you. You've just been going about it the wrong way.
Get the family and the car off your back, an emergency fund in place of $15,000.
. That's $30,000 worth. Then you go back and start talking about the house again. And you don't have to be so intense on the house. You're going to wander out of that house.
You don't have to be quite so fired up about it. It's interesting, though, the way you opened the phone call with us. It sounded like you were on the verge of bankruptcy or something. Like. you were stuck.
And quite the opposite is true. You're making incredible progress. And you're living on nothing and applying all of your money towards your goals. So, you know, you're way ahead of the game. You're far from stuck, sir.
You're actually very successful.
Well, I mean, you know, I'm 23 years old. Just turned 23.. And I just felt, I guess, off. That I have no money in the bank.
Well, that's fair. Okay. But you understand, the progress you're making mathematically is pretty incredible.
I can see that, yes.
Okay. I want you to own that. Because that helps you continue. Because if you feel like you're doing something wrong, you lose your emotional momentum to fight on through. But get the family off your back.
Not like they're on your back. They may or may not be. And get the car off your back. It is definitely there. And have $15,000 in the bank.
I think that will put you in a different emotional spot. And then let's turn up the lifestyle a little bit. Like, have a life.
And slow down a little bit on paying off the house. I want you to pay it off in, you know, 4 or 5 years. 3 or 4 years. So, like, I don't know, you're 27 with a paid-for house in Tucson, Arizona. That would be a weird Gen Z thing to do.
Lovely.
You know, I want to point out to our audience. We have a lot of new people joining us all the time. And I'm glad, Dave, that you're here on this call. Because this is an example of why, so many years ago, you created the Baby Steps. To create not just financial momentum, but actually emotional momentum.
And so here's a guy who's got his act together. The studio audience is shocked. There's a 23-year-old. He's like, I feel like I'm stuck. Well, he's been putting all of his money on the biggest piece of his debt, which is the house.
And therefore, he has no emotional momentum. And that's why he presents this way. And that's the magic of what you created all these years ago.
You know, the power of Baby Steps is you can go anywhere you want to go if you just keep walking. Right. It's just one step at a time. Right. And so...
He feels like he's in a hamster wheel right now because he's going at it the wrong order.
Yeah. And so knock out the little stuff. You know, start achieving some of the goals. So, hang on, Malachi. I'm going to send you a copy of the book, The Total Money Makeover.
About 10 million people have got it. So, it's working. And the Baby Steps are outlined in that. And it'll show you exactly what to do. And it'll change that.
Because Ken's right. What we figured out, Malachi, and for the rest of you, is that personal finance is 80% behavior.
It's only 20% head knowledge. The mathematics of wealth building you learn by the 6th grade. It's not rocket science. This is not med school. You don't have to have a master's degree in finance and statistics to become wealthy.
It's literally 6th grade math. So, math is not our problem. It's not bothering to pay attention to the guy in the mirror and his decisions. Malachi is paying attention to the guy in the mirror and is making great progress. We're just going to redirect his progress a little bit.
so he feels it. That's exactly right. And if you feel it, then that matters, because this is behavior. So, it's all about feedback loops. The psychologist would tell you.
So, you're not going to keep going to the gym and not quit eating and not stay away from donuts if you don't lose weight as a result. You're like, bring on the donuts and I'm not sweating. If I'm going to not lose weight or I'm going to gain weight, I might as well enjoy it. But if you go to the gym and you stay away from donuts, I'm talking to Dave, then you can drop some poundage. And then you go, oh, well, that behavior resulted in a result that I like.
So, I get a feedback. Positive feedback keeps me doing it. That's a feedback loop. And that's where all this comes from and where it goes to. So, very, very good stuff.
Devin is in Kansas City. Hi, Devin. Welcome to the Ramsey Show.
Hey, thank you guys for taking my call.
Sure, what's up?
Hey, so me and my wife are wanting to know if we're in a good financial spot to make her a stay-at-home mom.
Can you live on your income?
I believe so. It can be tighter than what we're used to.
Well, of course.
After budgeting it out and doing our every dollar budget.
What do you make?
After all, I make about $56,000 a year.
What does she make?
She makes about between $20,000 and $25,000.
How many kids have you got?
So, we've got one right now and one on the way, due in about November.
Okay. Well, daycare and some professional clothing is just about eating up her income.
Yeah, she works in a daycare, luckily.
Oh, well, then it's not. So, she gets $25,000 plus, she gets a deal on the baby daycare, right?
Yeah, and I think we would technically qualify for daycare assistance in Kansas. So, that would help out as well.
I don't even know what that is, but okay. We have daycare assistance. All right, good.
That's another government program.
It sounds like a joy to me, but I don't guess you need that if she's going to be at home.
Yeah, correct.
So, here's what you do, man. Not only run your budget, between now and the time she quits, live two or three months on your income without touching hers.
And apply all of her income or more to your baby steps and prove to yourself that you can live on your income. Just act like she doesn't have an income and run your household. Because if she quits, she ain't going to have an income. You better get used to that. This is the Ramsey Show.
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Ken Coleman, Ramsey Personality, is my co-host today. Thank you for joining us, America. The best way to make the most of your money is a plan. Tell your money what to do instead of wondering where it went.
Most people, the money comes in, the money goes out, only the names are changed to protect the innocent. We don't know where it went. That's most people. And then you scratch your head and wonder why you're broke. If you ran a company and your job was to manage money and you managed money, the way you managed money for you, you'd get fired.
for incompetence. Because if you work in a business, you're supposed to have a budget. And then you're supposed to stick to it and stuff. Hello?
That's kind of basic, y'all. I mean, it's really not hard. But it's hard because it's dealing with me and I gotta look at the teenager and go, now, and I gotta have a discussion with my spouse about spending. and, you know, we gotta quit eating out every freaking night of our lives and then wondering why we have no retirement because we're eating it. That's why.
Basic stuff like that comes up when you do a budget. Hello? That's why we came up with the idea that every dollar needs an assignment. Every dollar needs a name. Every dollar of your money, before the month begins, needs a mission beside it.
You need to send it out there to do stuff for you. You work too hard to be broke. And the only thing that fixes that is giving every dollar an assignment. That's why we named the world's best budgeting app EveryDollar. And that's why tens of millions, no exaggeration, tens of millions of people are using EveryDollar every month, the budgeting app, to run their budget with their spouse.
Download EveryDollar for free in the App Store or Google Play, or go to EveryDollar.
com and let's get started, boys and girls. It's time to do this. Open phones at 888-825-5225.. John's in New York. Hey, John, how are you?
Hi, Dave, how are you, sir?
Better than I deserve. What's up?
I'm good.
I'm 23 years old and I had around 57,000 liquid cash in the bank.
I got kind of screwed over by the car industry twice now. When I was 19, I bought a new Mustang very bad mistake.
And obviously I was upside down and then now I have a Cadillac. Obviously, I got it pre-owned. That loan is around at $35,000.. I just got it about 8-9 months ago. And then I have student loans of about $25,000..
They're not crazy high because I went to community college. I've been listening to you guys for a while. And I just wanted to.
What do you make? What's that?
Around $80,000.
What do you do?
I'm a bartender at my family's restaurant.
Very cool.
Thank you.
And so your question is what?
Should I? Because I've watched a couple of your videos if I should just take the $57,000 and dump it into all the debt and just clear it, but then I have nothing left in my account, or do I do thousands at a time and knock it down as quick as I can?
Okay.
Is your goal to be wealthy?
Yes.
Because you make a lot of money. You're doing really good. You must work really hard.
I do. I work six days a week.
And some serious hours too. Good for you. Thank you. You're in a pretty sweet spot for 23 years old. overall.
You've done some stupid stuff. A couple of things that come out of the conversation. One, you did not get screwed by the car industry. You got screwed by you. Because you walked onto the car lot and you bought a car you couldn't afford because you were acting like a child.
Is that fair? You're not a victim, dude. You caused this. Both times. I don't know why a guy making $80,000 that's 23 years old working his butt off needs with a $35,000 Cadillac.
I don't know why you have to have that. You might rather have the cash than that.
Right.
So one option is to sell a car and buy a $10,000 car for cash. And then you don't have to give up all your cash. You just give up the Cadillac.
That's the main thing I want to avoid. I don't want to just deplete all my savings that I worked for.
Then the Cadillac's on the block.
If you want to keep the Cadillac, you need to pay it off.
Right.
Your money's already gone. Paying it off, you just admitted.
Yeah.
You've already spent the money. You just hadn't admitted it yet by paying off the debt. Of course. You can choose, because, basically, if you sold the car for $35,000,
and you took $10,000 and you broke even and got out of it, cleared it, right? Will it bring $35,000??
No, I think it'll bring $24,000, because I was upside down from the other one.
Oh, you rolled negative into it.
Yeah, I was around $9,000 negative.
So you're going to spend $10,000 of your money, even if you sell it. And you're going to spend another $10,000 of your money to buy a car and you're going to spend some money to pay off the student loan debt.
Right.
You said $25,000 in student loans?
Yes, sir.
Okay, so you're $60,000 and you got $57,000, so you don't have enough to pay off everything.
Yeah.
Quite, but I mean you're making money and you're used to stacking cash. The premise is this. If we could get you where you had no payments student loan and the car payments gone through whatever mechanism, either paying it off or selling the car you choose.
If we can get you where you don't have any payments but most of your money is gone without any payments making ADK, you could stack that cash up real quick again. It won't take long. Just a few months. I mean you probably save $5,000-$6,000 a month, can't you, if you don't have any payments?
Yeah.
Are you living at home?
I am, yeah. Me and my mom and dad live above the restaurant.
So you got almost no overhead. I thought that. That's how the $57,000 got there.
I got some quick numbers here. I want to run with you here. I think you're still walking away with Dave's plan with $11,000 in cash, because if you owe $11,000, so you're going to pull $11,000 out because you're upside down. You're going to spend $10,000 on another car, so that's $21,000.. $57,000 minus $21,000 is $36,000..
We owe $25,000 in student loan. that leaves you with $11,000.
and you're debt free. No payments and a paid $4,000-$10,000 car.
You live at home with a pretty secure job.
You're stacking cash like a boss, man.
Right.
In 10 months, you'd have $60,000 on top of the $11,000.
. You'd have $71,000 in 10 months.
I also have $10,000 in an IRA that I'm maxing out every month as well.
I would stop that until we get this mess cleaned up. If you're going to clean up the mess in one fell swoop, you don't have to stop it. You can stack cash. You're going to follow me. Especially if you don't have a car payment.
It's $35,000.
I'm going to use up all my money for a hot second.
because a month later you're going to have $10,000 more. A month later, you're going to have $8,000 more. A month later, you're going to have... You follow me?
You're not going to be out of cash, but just for a few days.
You still have $11,000.
He's $57,000 down to $11,000, and that's causing emotional distress.
Heartburn.
The point is, it's a temporary situation and it's the best path for you to become wealthy, because your most powerful wealth building tool is your income, and you don't give it all to car companies and student loan companies. You get to keep it, and that causes wealth building. That's what I'm going to tell you to do. I would be debt free, either by selling the Cadillac or not.
immediately.
Even if it caused my heart to burn. because, keep in mind, your heart's not going to burn for very long because, with no payments and serious motivation called a little bit of fear, you're going to stack that cash real fast and you'll be right back where you are by Christmas and you'll be a whole 23 years old. Wow. You've got lots of time to be smart. now.
This is the Ramsey Show.
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com Ken Coleman, Ramsey Personality, is my co-host today. Open phones at 888-825-5225. 888-825-5225. Guys, we could use your help if you will click, subscribe or follow on YouTube or Spotify or podcasting, or whatever Apple, wherever you are. if you subscribe to us, follow us, it changes the numbers dramatically on how those platforms push our show forward and new people discover us because you subscribed or followed, because you left a five star review, because you shared the show.
Some of these platforms have a share button where you can just share, send it to your buddy and say hey, give these guys a listen, or cut the link out and send it in an email. or, if you're listening on talk radio, just say hey, I listened to this station, you ought to try these guys out. Just like you tell your friend about a good movie or a good book, same thing or a good Netflix thing. you need to binge watch. I'll give you one of those.
have you seen the Steve Martin?
documentary? No, but I'm a big Steve Martin.
fan. Apple TV. Okay. Two sections, the old days when he becomes famous, and his current days. Yeah.
And it is it's lights out. I'm in because I'm a big fan of his. Well, I mean you the behind the scenes stuff. he pulls out of his journals when he was about to fail and he almost quit, and it's then he has breakthroughs. it's pretty cool.
Yeah. See, there I just shared with you guys, I gave him a free plug and you're welcome, Steve, and he needed our help, I'm sure. I'm sure. But it's good. It's a great documentary and he's, of course, doing his sister, his parents were, it was a wild family situation, man and his sister's on there talking about it.
It's pretty cool.
Did he cover any of his bluegrass music?
Oh yeah. It's quite the.
if the casual fan doesn't know it, he's a wonderful banjo player. World.
class. Like incredible. I've been on the Grand Ole Opry with it. It's crazy. Elyse is with us in Sacramento.
Hi Elyse, how are you?
Hi, thank you so much for having me. I've been listening to the show for almost 10 years now, so it's an honor. so thank you for all you do.
Brad. Well, we're honored to have you. How can we?
help? I have a career question. So my question is a little background. Essentially, I am in a niche area of nursing and I've made a couple changes in my career the last two years because I essentially was burnt out in what I was doing and I was ready for a change, and so I've made that change and now I'm almost looking into whether I should go back to that other career or, essentially, reassurance that I'm good where I'm at.
Okay, what's making you question this move?
I think it's because I have multiple passions in the niche nursing areas that I'm in, and so I have the unique opportunity to be able to also what we call float back and go back and forth. but my question, my questioning to myself, is
wasn't fun.
I didn't like it. Why would I float back to something I don't like?
I think it delved into. I enjoyed what I did, but the stress eventually got to me.
Right, so the question becomes, though. so let's stay right there for a quick second. The question is was that circumstantial, or is that a part of the actual gig? and it doesn't matter what hospital system I'm in, what state? it's the nature of the role?
or was it circumstantial to the environment? That's the real question.
The nature of the role. The stress.
It's the nature of the role. Because I work in multiple hospitals.
Alright, so here's the deal. So then you have to say are there things that I have control over that I can do? that I didn't do in the past. that would allow me to manage the stress? In other words, you know it really well.
so are there physical things you could do differently this time? Are there boundary issues when you're not at work? That's my question. Is there anything that you could do the second time around that would alleviate the stress?
Possibly. I don't know that I necessarily have any control over it, because at the hospital, right, things happen and that's the nature.
of the job. Okay, so that's my point. So that's our answer. If you can't control some of the stressors and there's not something that you can do that would allow you to be in the role and thus manage the stress, then I think that's your answer. It just doesn't make any sense for you to go back to it.
Just because you.
can. Yeah.
It has a detrimental effect on you.
physically, mentally, emotionally. I'm burned out. I was overstressed, and now I'm going to walk back and do the exact same thing again. That's what you're saying. That's not logical.
That's my exact worry that kept coming back, and I think I'm looking into.
. I'm an overthinker. so I'm looking into oh, I missed that role, I missed a lot of aspects of it, but I'm very happy where I'm at now and I make the same amount of money, and so I think to myself... You're done.
You're not going back. Work happier, smarter,
less stress, save money. You're having.
selective memory about the good parts of the old job that you left because you hated it.
Yeah, there's something.
You let it go. There's something deeper here and I would.
just say you have to dig a little bit deeper into this over-analytical side of your brain. Boy, you're talking to an overthinker. so let me just say I get that, but there's something deeper there that makes you keep wondering, am I missing out? Am I missing out? And I think you...
I'll take a stab at it and I think maybe a session with a counselor might help or a really good friend. I think that you don't trust your own judgment and I think there's something deeper there, but I think that's the source of this. and again, when I get into this kind of loop myself in my own life, I'm being very vulnerable and transparent to say, when I overthink, it's because I've got to go back inside and go, what do I not trust in my own judgment? What's behind it? I think that's probably the source of it, just to try to help you out here, because all the common sense and all the factors here lead to don't go back, which is why Dave and I are saying stop thinking, stay where you are.
Gary is with us. Gary is in Greensboro, North Carolina. Hi Gary, how are you?
I'm doing well. Quick question, when you get out of debt, how do you rewire your thinking or change your thinking so you're not afraid that you might go back into debt?
That's a great question.
What I did when I went broke was I did an autopsy on my stupidity.
I'm like, okay, that was stupid and that was stupid, and I was stupid when I did that and that was stupid. and so I try. not... I do a lot of stupid stuff, but I try never to do the same stupid thing over.
That's one less stupid thing I know not to do. And so if I do stupid things now, it's new stupid things. Right? You know what I'm saying? And that's kind of how I looked at the debt thing.
I looked at it and went, that didn't work. Why would I go back to something that didn't work? It did not bring me joy, you know. It does not bring me joy. Thank you,
Marie. I guess I was thinking, you worry about having a major housing expense that you can't... that you're not quite fully funded.
Well, that's called savings.
Right. But what do you do in the meantime before your savings gets to that level? That's kind of where we're at. We're out of debt. We're working on...
That's a different kind of a.
. Okay, so that's fear of an outside variable coming at you, not you relapsing into stupid. Okay. That's a different fear, right? Okay, so I misunderstood you.
I'm sorry. I thought you were talking... So you're saying, I don't have enough money to put heat and air in. If my heat and air goes out, what am I going to do? Exactly.
Okay. So how much money have you got saved?
Right now, we've got about $6,000 to $7,000 in savings account.
Alright. And what's your household income?
About $54,000.
. Okay. So,
you'd have to have a $10,000 expense before anything really bad, before you were back to actually facing the decision about debt. Because if you had a $3,000 expense, you'd just do it, right? Correct. If you had a $5,000 expense, you'd just do it. It would hurt, but you'd just do it.
Right.
Yeah. What would you say to your kids if they came home one day and said, Dad, I'm worried about what's going to happen on this sports team that I just signed up for two, three games in? What would you say to them?
Work hard and do your best.
Don't worry about it.
Today has enough worry of its own. Don't worry about tomorrow.
Dale Carnegie did a whole segment on worry and he said the statisticians tell us that 80% of what we worry about never occurs.
Yeah. That's fascinating.
The number of personal emergencies that a guy making $54,000 has that's over $6,000 is virtually zero. Virtually zero. So, yeah, your statistical probability of that happening is almost none. You're worrying about something that's not going to happen. Keep piling up cash, my man.
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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. Ken Coleman, Ramsey, personality, number one, best-selling author, host of the Ken Coleman Show, is my co-host today. Open phones at 888-825-5225.. Marcus is in Boston.
Hey, Marcus, how are you?
Hey, Dave, appreciate you taking my call.
Sure, what's up?
Hey, so I'm gonna make a long story as short as I can. So, I have... I owned my own insurance practice and financial practice a couple years ago.
And basically, it was costing more money than what I was making. And I pumped all my savings and I even cleared out some Roths to keep it afloat. Well, I eventually got out of that and.
didn't realize the negative ledger that I had, the negative account that I had, would go into collections. Well, I started paying, then they started calling me on a bi-weekly basis, and then it became, you know, six, seven times a week. And I was making consistent payments of $30 to $50 a month. But they stopped calling me and I just want to, you know, I don't want to just think this thing has gone away and that, you know, should I be worried about them drawing up a lawsuit against me?
What is the debt for?
So, I actually did the exact opposite of what you believe in regarding. I sold whole life insurance, variable whole life, and annuities.
Oh, so this is commission chargebacks.
Yeah, exactly. When you get paid, you're not really getting.
I know. And so these are commission chargebacks. So, the company that you used to sell insurance for is going to sue you?
No, so, not yet.
I'm just trying to.
. Well, but I'm saying, how much do you owe them in commission chargebacks?
$1,500.
. So, it's really not...
$1,500?
Yeah. What do you make now?
Right now, I make around. I'm on page for $75, but I'm also at another job.
And you're also at another job in addition to the $75?
No, no. So, I work a more than full-time job, and I'm on page to make $75,000.. But I got in such a hole with my practice that
Oh, no, but $1,500 solves this problem.
Right, yeah.
And you make $75?
Yeah, I'm on page for that, yeah.
Well, what's on page mean? You either make it, or you're going to make it, or not. Is it commission again, right?
No, no, no. I'm in a totally different field now. I'm in logistics. I do have a stable income, but it does vary on how much I on whether how much...
Okay, so what did you make last month, honey?
So, I pulled in $6,500.
Okay, what will you make this month?
I'm on page for around, let's say, $62,000.
Okay. Why can't you just write them a check?
I have.
. You know, I have another range of debts that are, frankly, far more...
that have far more urgency than these people. I mean, and from a liquidity... Like I said, I got in such a hole. I got three behind on my mortgage.
How much other debt have you got?
Let's say about $7,000.
Are you current on your home?
I am.
What's the $7,000 owed to?
Other credit cards, and then a couple medical bills.
Okay, so why are they more urgent than these people who are getting ready to sue you? Because this life insurance company is going to sue you, dude.
I don't care if they got quiet or not. They're going to get their charge back. I've never seen a life insurance company that didn't get a chargeback commission back out of somebody's hide. They're coming for this. Medical bills might get around to it in two or three years.
Credit cards in three or four years. But these boys are coming. I don't care whether they're quiet or not.
Right.
So $8,500 cleans up your entire mess. And there's a lot more than $8,500 stress in your voice.
I think it's because you got the crap knocked out of you.
Oh, I did.
Some of your confidence. This $8,500 $7,000 of credit cards and medical bills, plus $1,500 of commission chargebacks, feels like $85,000 in your emotions.
Yeah, exactly. Here's the thing. I'm making good money, subjective. I'm making pretty good money. You are.
And I am current. But from a liquidity standpoint, I have other investments that are illiquid. I'm not going to incur those fees. What I have readily available right now is $2,000..
Other investments that are illiquid. Like what?
I got a couple mutual funds, a couple Roths.
You have mutual funds that are not in a retirement plan?
Well, so I have.
I have.
Do you have any non-retirement investments?
So they're all retirement investments right now. I just opened up a new Roth. I actually drained my old one. And, like I said, if I have an emergency fund right now, if my car broke down or something, I have $2,000 available liquid. I know you're going to tell me to pay this off $1,500..
I just did, yeah.
But what happens is as soon as you get rid of the money that you have, something worse happens. We want that emergency fund.
Dude, you are running so scared, you're not even thinking clear.
$8,500 makes your whole stomach unwind and it's in your throat. $8,000, lousy dollars. It's not $85,000.. And you make $75,000.. You need to sit down and do a written budget tonight.
Are you married?
No.
You need to sit down and do a written budget. Detail out exactly where every dollar of your money is going to go this month. List your debts. Smallest debt to largest debt. And begin to pay them off as soon as possible.
Take $1,000 of the $2,000 and apply to that. Liquidate all non-retirement investments. I don't want to hear illiquid investments. There's no such thing. Sell the stupid bitcoin.
Sell the stupid whole life policy. Get out of it. Get your money out. You need the money. Because, honey, if you didn't have this $8,500 worth of debt, you'd have so much peace in your life and you could put the rest of this crap in your rear view mirror.
Yeah, I would get busy too. You can make money. It sounds like you're a single guy. You've got some time. I would be freelancing in the logistics space.
If I have to go drive, deliver, do landscaping just to get yourself some breathing room, because you can knock this out really quickly. You just start calculating how many hours would I need to work at X amount of dollars to make an additional $8,500.. Just start playing with this and start to see possibilities.
You make $6,500 a month, you're a single guy. You put $2,000 a month on this, you're done in three months.
I think the budget probably takes care of this.
Sit down and do a budget. Lay out how you're going to do it. $2,000 a month, four months, you're done. That's it. Then you build up your savings.
A good three to six months of expenses.
And you figured out that.
Folks, 85% of the people that start in the whole life business as life insurance salesmen are gone in one year.
That's what that is. This is the Ramsey Show.
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Ken Coleman, Ramsey Personality is our co-host today. Thank you for joining us. Open phones at 888-825-5225.. Today's question comes from Jonathan in Massachusetts.
Jonathan says, Without getting too deep in the weeds about my background, I've always had what I would consider a menial job on a help desk and I don't see that changing in the future. My concern is about the example I'm setting up for my five-year-old son. What can I do to ensure he succeeds at his chosen career when the time comes, and how do I encourage him so that he actually does something meaningful with his professional life? I will keep his mind open to trade school possibilities and won't dismiss anything. He simply has to do better than I have.
Wow.
Man, I wish I could give you a hug, Jonathan. I would say to those who feel like Jonathan feels,
you can change your future. You can change your future professionally. To the specific question, this is kind of a parenting question on how do we set our kids up so that they can do something meaningful in their professional life. I think it's a very simple formula that I teach, and it's in a simple sentence. If they use what they do best to do something they enjoy, to produce a result that they care about, they're going to be very, very fulfilled.
That is the recipe to meaningful work.
That's in the book, Paycheck to Purpose.
That's right. Paycheck to Purpose, we unveil seven stages that will get you there, a clear path to get you there, but that's the formula. How do we do this with our kids? Early on, mom and dad, pay attention. Pay attention to the things that have come easy to them.
I mean from the time they were toddlers, all the way up through high school. What are the things that just have naturally come easy for them? Maybe their siblings struggle, but it comes easy for them. Help them see that. Help them, pay attention to the compliments they get.
Where are they getting compliments in their life? This is just basic awareness that you, as parents, instinctively are going to be able to see, but you help your kids see this. What this does. early on, before we ever start thinking about college and a major and a professional life, we start to pay attention to what they're good at. There's a high correlation, Dave, between the things that we're good at and the things that we actually enjoy doing.
You don't generally enjoy something you suck at. That's right. With the exception of golf.
That was what I was going to say, and that's because of the company and the surroundings.
We start there. Let's not overthink this. As they're younger and they're beginning to age into high school and there's pressure to choose a college and then a major and a career path, hopefully, as parents, we've given them this foundation that early on they're paying attention to. This is what I'm good at, and this is what I enjoy. As they begin to experience more of life, let them test some things.
Here's one thing I don't think parents do enough of in America. I think it's when we get a kid who, let's say, says I like working on machines. I'm good at fixing stuff. One of the things I would do is I would allow them to spend time with people in different walks of life that are in some ways fixing something, solving a problem mechanically or maybe with their minds, and begin to let these kids shadow and see the real thing. I think you'll see your kids' eyes light up.
We've made this thing too complex, because what we do is we put pressure on these kids to choose a name, brand school and get a degree. that seems to make a lot of sense, according to Kiplinger's and U.S. News and World Report, and we push kids into a career that they end up in their early 30s, regretting that they did and they can't use a degree. That's the answer. Now, we actually have a student assessment.
It's called the Get Clear Career Assessment. You can get it at RamseySolutions.com and it's actually made for students. We took the adult version, which has been a wild success, and we simplified it. Not a five-year-old, but as I'm talking to parents in general, this is a wonderful tool. If you've got a high schooler, get this assessment.
The results will allow you and them to get on the same page and begin to talk practically through the advice I just gave. I'm really proud of the tool because it actually works.
It does. It's an incredible tool. What you're referring to is what the old Proverbs says in the Bible. in King James versions. I like the King James version on this.
It says, train up a child in the way he is bent. The other versions say, train up a child in the way he should go. When he's old, he'll not depart from it. Bent, meaning what is his natural bent? What is his giftings?
Find that and then accentuate that. By the way, a kid that likes to work on things doesn't necessarily mean that he or she is a mechanic. They could be a mechanical engineer. If you see things spatially, you could be an engineer. By the way, engineers are the number one career category of millionaires.
Correct. Highest probability of being a millionaire among our study. anyway. It's very interesting. I've got to circle back though, Jonathan, and tell you.
raising kids, more is caught than taught.
If he doesn't see his dad going for it and stepping up and stepping out, instead settles back in that easy chair at the menial desk job and I'm just stuck. What are you, freaking, Eeyore? Get up, man. Get up. Throw your shoulders back.
Suck it up. Step out. I don't care how old you are. Some really great careers start in people's 50s, 60s, and 70s. Colonel Sanders never fried chicken publicly until he was 72..
Wow.
Leonardo da Vinci painted the Sistine Chapel laying on his back. It's the ceiling, by the way, boys and girls. At 78 years old. It ain't over as long as you're sucking wind.
Stand up. Throw your shoulders back. Suck it up and go. do something, buddy. Your five-year-old needs to see you do that.
That's right. That's what he needs to see you do. I'm stuck. It's always going to be this way. Oh, crap, man.
Get up. That's silly. Don't do that. Don't do that with your life. If your life is too precious for you to do this, Ken wants to give you a hug.
I'm kicking you in the butt.
That feels about right.
I'm going to be Coach Ramsey right here, man. It's halftime. Get your butt up. You're behind. You need to catch up.
Get it. Get out there, man. That's what your son needs to see. He needs to see his dad do that. Even if his dad falls flat on his face, at least he's running.
At least you get your hands scratched when you fall, hit the pavement. You get your nose bloodied when you fall and hit the pavement. Shut up. Get up and do it again, man.
Live your life. This is a life. This email screams of quiet desperation. Yeah, it's true. Come on, man.
Your kid needs to see that. More is caught than taught. They're not going to excel if they've never seen any adults excel. If all the adults in their life settle, please expect them to settle. Please expect them to do that.
If the adults in their life esteem academics, expect them to esteem academics. If the adults in their life fill in the blank, expect them to fill in that blank. Whatever it is, okay? Hello. That's what these kiddos are.
Some of them will revolt directly against it, but at least they've got something to bounce off of. So get it. Get it. Get it done. I had a friend as a real estate agent, a friend of my dad's.
I used to do deals with him. He worked all the time. He just passed away. He worked all the time. He had two kids.
One of them said, I'm going to be a teacher. I'm never getting real estate business. My dad worked all the time. You know what the other one does? Real estate.
Real estate business. That's right. At least you've got something to bounce off of, man.
That's true. I think that's absolutely right. By the way, he, in all reality, he's a very affordable tech certification program, away from potentially doubling his salary.
Wow, God.
Because he's got a background in tech.
You say that?
So he's not stuck. He's got a support desk, a help desk.
Yeah, but that doesn't mean it's tech, does it?
I'm assuming help desk means tech, but.
. Oh, I don't know.
If it's tech, it's even worse. Yeah, you're right.
I've never heard that phrase used for anything else, but I could be wrong.
That's because you always need help with tech.
It's funny. I actually did email our tech team today.
We have one guy. His full-time job is to fix the tech I break.
I'm in the same category.
All the phones and computers that I walk near, they all just blow up.
So, yeah. We got our own little help desk thing going here. I don't know what kind of help desk you're on, man, but go, do something. Don't settle. Get back to your life, man.
Go have fun.
Open phones at 888-825-5225.
. You jump in. I'm Dave Ramsey, your host.
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Ken Coleman, Ramsey Personality, is my co-host. Thank you for joining us, America. Open phones at 888-825-5225.. Sarah is in Minneapolis. Hi, Sarah.
How are you?
I'm good. I'm so excited to talk to you guys, and I'm a little bit scared. But thank you for taking my call.
It's okay. We've never lost a patient. You'll be okay.
I will get to the explanation as quickly as I can, and then get to my question, if that's okay. Sure. My husband is in commercial construction. He's a field superintendent, and it's a family-owned company. His grandpa started it, and now his dad and two uncles own it, along with one other non-family CFO.
We moved to Minnesota about six years ago so that my husband could work for the company and eventually take over ownership with his two brothers. My husband and his two brothers are the only family members that are interested in being owners, but the current owners also would like to bring in a number of non-family owners as well. The succession plan has been extremely difficult to plan for. The owners have been not willing to communicate details, so we don't know how to plan for things, and two of them are set to retire at the end of this year, with the other two that are going to be hanging around for another 10 to 15 more years. With all of that, there's just been some character information that has come out about the owners, and my husband has just been questioning whether or not he actually wants to take part in the ownership anymore.
We just started dreaming about moving back to South Dakota, where we met, and him starting his own handyman business out there, and I train horses seasonally as well. Right now, my husband brings home about $90,000 a year, and I'm about $25,000 between May and September, so monthly our consistent income is about $7,200.. We have two kids that I homeschool. Our mortgage is about $3,000 a month. We have no car loans.
We do.
owe $450 on our farm. We've got a.
rapid city.
It's a large enough market that he can build an actual handyman business and probably make more than he's making now.
That's the hope.
No, it's not. It's not a hope. He can do it. I don't know if he will or not, but we're working with handymen that are making $250..
Awesome.
It's a huge business, because nobody knows which end of a screwdriver is anymore. Our culture is
tool illiterate, and so anything that breaks, they've got to call somebody.
Ken Coleman.
Yeah, that's.
true. He can do anything.
Seriously, if he will show up on time and do what he said he was going to do, he can charge whatever he wants, and he'll have a line around the block.
Okay. Why don't?
we go do this?
Yeah, what's keeping you from saying this is a no-brainer?
Because, well, one,
we owe about $415 on our house, and on top of that,
we bought a screwdriver because
he's so handy. Right now, the house is worth $750..
So why can't you sell it?
Because by the time we would clear our debt, we would have about $150,000 left over, and then to buy a farm.
. Why do you have to buy?
a farm?
Because that's my job. I train horses, and that's kind of... You have a farm now? Yes.
How many acres do you have now in Minneapolis?
Minneapolis, we only have 10.
It's the only place to train horses is your personal farm?
Yeah. I mean, South Dakota is like one thing that gots land.
I don't know. Oh, yeah.
It's very expensive, though, and so that's our hang-up is we don't know.
if we can.
. Cedar Rapids is expensive?
No, South Dakota. I'm sorry. Rapid City.
Rapid City is expensive? Same, same, same, same voice tone. No, it's not.
Okay. Rapid City, South Dakota, is not expensive. I'm sorry. You're not trying to buy 10 acres in New York. You're not.
It's freaking South Dakota.
The houses that we would need, the cheapest that we're finding with a house on 10 acres of land is going for about $500,000, and I don't know if we can.
. So don't.
buy 10 acres of land. Go lease 10 acres of land. Do your little horse business.
until you get the horse business big enough that it justifies a $500,000 investment, which is probably never. Yeah.
I'm with Dave here, Sarah. Let me throw an idea at you. Why don't you sell and move up there, maybe rent for a couple of years, get your feet on the ground, as in...
Get his handyman business going.
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