Are You Willing To Trade Your Comfort Today For Peace Tomorrow?

26:02So we have a total. We have three items of debt in our lives. That's it. No car payments, nothing. A mortgage of$222 ,000. um my husband's student loan is about$106 ,000 okay and then um we have a uh let me see this last one here sorry oh a business loan at about 115 ,000 so kind of roughly about 440 thousand dollars almost half a million dollars in debt is the business still alive it is still alive um it's our personal business so i and my husband's a physician um i know that kind of plays into it, that we started our own clinic. So we pay him a salary and then we take quarterly dividends. Well, I am at the mindset, I want my house paid off.

26:56I pay my kids private school with cash. Everything is cash. But these three things, and they are bothering me so much. But my husband wants to take these quarterly dividends after paying off the minimum balance of the loans and put them into our fidelity. So sometimes seven to$10 ,000 a month goes straight into fidelity. And I just don't, he just, once he thinks when you invest early, it just pays off later, but well, I get it. I get it. Well, he's right. And he's wrong. Yeah. Um, there's worse things you could do than invest your money, but Ken's going to explain why that's not the good. Yeah.

27:32I'll let you do that. You're the money guru, but I just am curious. What are you all paying him? See, and that's the thing. I pay him$200 ,000 because we just opened five years ago. So, you know, we work with our CPA. Sure. You know, it's probably going to have to start going up because the dividends have become greater this year. And I was going to ask you, could you give us maybe a six-month average of what the dividend, I mean, that's not a six-month because I know it's quarterly. Give me a year's worth of quarterly dividends. What's that average? We probably tax is about$450 ,000. Okay. So you're averaging on these dividends somewhere in the 7 to 10 range.

28:12Yeah. Whoa, we just lost you there. We got you? There you go. Is that right? So quarterly dividends somewhere between 7 to 10? Is that what I heard? Yes. And I aggressively pay off, I pay almost$7 ,000 a month for this business loan. So I only have a year and a half left. So you are paying on that. Just the minimums, right? I take that money in. Are you just paying the minimums on the debt? I'm paying the minimum on my husband's student loan because I think it's like a spite thing. And then it's only 2.6%. But what about the, okay. But how are you paying down the business loan is what she's asking.

28:48Yeah, what about the business? Is it just the minimum on that? The business loan is paid through the business before the dividend. So every month I pay almost$6 ,800 a month. Understood. But is that the minimum? Or are you paying above the minimum? I'm paying a little bit more. I am. And it's a 6.86%. You both have different ideas about what the priority is. It sounds like you'd rather take that money and pay off the mortgage. Did I understand that? Yes. Mortgage every... I mean, if you're looking at the... It's the mortgage 3.125. Understand. So you're talking about this. Here's a problem. And I don't know if I'm going to get through on this call, but it's something that's food for thought.

29:24He's thinking about the future. He's thinking, let me take this extra money and invest. Not a bad idea. There's, like I said, there's a lot worse things you could do with the money. You're thinking about the money saying, let me take this and put it on the mortgage. Again, not a horrible idea. You could do a lot worse, but let's, what I'm here to do is give you guys a sense of what the priority should be. So all good ideas, but they must be prioritized in order of importance. You feel me? So first off, you've got this debt. I don't care what the interest rate is, it's still climbing. Can we agree on that?

29:56A hundred percent. And as long as we're paying minimum payments, we're probably never going to pay this thing off. We're going to pay so much in interest. So why don't we prioritize paying off our debt? And I say this because when you pay off the debt, now you have what Dave Ramsey would call your biggest income, your biggest wealth building tool, which is your income working for you. And once you have that income back in your hands, yes, you can pay off your mortgage very, very quickly. Yes, you can invest for the future far more than you ever were before. So let's get that tool back in our hands.

30:25The first thing you need to do is look at these student loans. They're probably broken into smaller pieces. You need to pay minimum payments on everything, student loans, business loans, but then you need to put all of the extra margin on the smallest debt and let's knock it out. You guys can be done with these student loans and this business loan very, very quickly when you're grossing and netting$450 ,000 a year or whatever it says that you were doing. You can do this. Priority matters.

31:06I love entrepreneurs. Don't forget, guys, I started my company on a card table myself. So I know what it's like to have people counting on you, your team, your family, not to mention your customers. and when you're the one signing the paychecks, you can't afford to fly blind. But I'll be honest, early on, one thing that nearly sunk us was wasting time with spreadsheets that didn't add up because business units didn't talk to each other. I finally told my team, just fix it. And they did. We got NetSuite. That was years ago, and we've never looked back. See, NetSuite isn't just for tech giants. It's built for growing businesses like yours.

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32:38All right. Our question of the day is brought to you by our friends at Y-Refi. If your private student loans are in default, it can feel like the end of the road, but Y-Refi helps you find a way forward with a low fixed rate payment plan that fits your life. Go to why refi.com slash Ramsey. That's the letter Y R E F Y.com slash Ramsey. It may not be available in all states. Okie dokie. Today's question comes from Nikki in Nebraska. She says, my husband and I are in our early thirties. We bought a home next door to his parents about five years ago. His parents' home is paid off with 40 acres of land.

33:15My in-laws want us to sell our home and build them a small home on the property with the money we make from it. Okay. Then they would give us their house free and clear. We bought our home for$135 ,000 and remodeled it. We could sell it for$285 ,000. The hitch is that my husband doesn't want to sell our home. He wants to take out a loan of around$70 ,000 to build a house for them and hold onto our home as a rental. What is the best move for our future? It ain't that. First of all, I just throw all the papers up. Yeah. I just tell you where I'm at. I just checked out of that question halfway through.

34:00They made this so complex. It's so ridiculous. I've never even, the gymnastics that I had to do mentally to get through that tells you one thing. Well, it's a lot. I mean, The gist of it is, for some reason, they feel like in some form or fashion, they have to buy a house for their in-laws. Yeah, I had three words that came to mind. Leave and cleave. It was in my marriage vows. Yeah, or how about no? How about no? Yeah, that's why you say no. Leave and cleave. No. Bad idea. Horrible. My in-laws want us to sell our home and build them a small home on the property. Yeah, I want my kids to buy me a Lamborghini.

34:42Sure. What else are we going to say that's ridiculous? Will you buy my G-Wagon, Kim? Sure. Why not? Oh, I was expecting you to say no. Well, I'm being ridiculous. I'm being ridiculous. It's just like, what? Yeah, no. No on all fronts. Live in your house. By the way, those people ask that question because they think they're going to get a positive answer. So there's a lot of psychology behind that, which I can't dig into over an email question. But boy, oh boy, that's a bad move. There's not enough to it for us to get to the bottom of it, but the answer is no. I'm going to tee you up, okay? Yeah.

35:12Big tee right here, giant golf ball. You got the world's biggest driver. All right. I'm teeing you up. All right. Tell our larger audience, forget the details of this question, but the whole issue that's underneath this, which is family pressure, doing financial things with family that have zero boundaries. There's your shot. Hit it down the fairway. I mean, I don't think I'm going to say what you think I'm going to say, Ken. I don't presume to know what you're going to say. you had something set up. I'm going to say that. No, I'm just saying why we think this is a bad idea in general. Because this right here is what I think is a classic case of, it has a guilt that's associated with it, Ken, because we can feel guilt with money, whether it's something I didn't do, right?

35:53They expected me to do this and I wasn't able to do it, right? We can feel guilt about doing the right thing and the people don't understand why we're doing it. So we can even feel guilty doing the right thing. And so what I sense from this is there's some family guilt here. Well, if we don't build them the house, how are they going to have a house? They know the right thing to do. That's right. That's why they're running out all these options. And they're afraid that if they don't build their in-law home, they're going to have to be the one that lives with that. When really it's the in-laws that have to live with that for whatever reason that they can't buy their own home or build their own home.

36:28That's their problem. You want to do a family compound great but everybody pays for their own home everybody pays for their own home and you shouldn't have to carry that yeah it's craziness all right well done you hit it right down the middle 400 yard drive McKenna is up next in Salt Lake City McKenna how can we help today hi thank you for taking my call um so my question today is my husband's employer just opened health care enrollment and we're wondering if we should re-enroll this year due to his premiums doubling along with his out-of-pocket max and deductible doubling as well. Oh, my gosh.

37:04Here's another real-life case of the affordability crisis in America. This is just absolute real stuff right here. Insurance prices have really, really, really skyrocketed. And what does Congress, what do they do? What are both parties doing? Just whistling. Whistling Dixie. Just whistling around in D.C. like nothing's happening. Here we go, McKenna. So give us real numbers because it'll help us. And then I want the American people to hear this as well. So it's going to go from what to what? So it's currently$500 a month, which has been okay for us. It's been sustainable with our income, but it's going up to$900.

37:43And what's your income? Wow. Our monthly income is$5 ,000 a month combined. Yeah, you feel that. Yeah, for sure feel that. We just had a five-month-old. Well, we just had a baby. He's five months old. So I'm grateful for insurance, but I'm also just like we're filling the pressure with it already being at$500. How are we supposed to go up to$900? I'm really lucky. My boss is amazing. He doesn't offer health care because it's a small company, but he does give us$200 a month towards health care. So I'm just like, do I self-insure? I've called my pediatricians. I've called my primary doctors, and I'm just like, how much would it be if I didn't have insurance and got those numbers?

38:25Have you priced it out? Are you going to the market on your own, not through his work? So I've called the market a couple times in the last couple days and tried to get a contact with some brokers. But due to the government shutdown, unfortunately, it's hard to get quotes out. And so they've been struggling getting quotes out to me. I've talked to probably four or five people, and I've only gotten one quote, and it was$700. Yeah. I mean, we could set you up with folks here. I mean, Health Trust, you could go over there and see if they can find some better numbers for you just to see. so you can compare.

38:56And I think that's the takeaway from this call is you need to run a comparison and see, is it better for you guys to go out in the open market on yourself using your $200 rebate? Or is it better for you to go through his work? The truth is, as much as I hate to admit it, McKenna, insurance is going up. I mean, it's going up here at our work. Everybody is feeling it. It's just part of what's going on in that industry. But you can always shop the numbers. You can always see if there's something that's better for you out there. And if not, then it's tough. I'm not going to act like this is easy, but you're going to have to adjust to whatever the new number is, because I doubt you're going to find it for the exact same amount with the same coverage.

39:39It's likely going to go up somewhat. And you're going to have to find that in your budget, whether it's cutting back in another area or you guys starting to look for different jobs that pay a little bit more. that's the very emotional side of this is when an external thing happens and it affects our life internally and it's like well wait a minute i had nothing to do with this and now here i am holding the bag for it and i have to change my life and rearrange my money and rearrange how i was working that's emotional and i'm sorry that you're having to go through that yeah do you all have any debt we do we have about 47 000 in consumer debt uh run just give me a list here go smallest debt to the largest debt?

40:19So our smallest debt is a credit card with about$1 ,700 on it, and then the next debt is another credit card that we put medical bills on for my son's delivery due to some insurance mix-ups, and we had to pay more out-of-pocket than we thought. We saved at$10 ,000, ended up having to pay about$16 ,000. There's about$6 ,000 on that credit card, And then we have two auto loans. One, I think, has like$19 ,000 and one has$18 ,000. Okay. I think a lot of your relief is found in those vehicles. Yeah. And that's why it's getting rid of that debt. So first of all, when we hear you, we see you, and it sucks.

41:01And I'm not going to pull my hair out today and rant at DC. Maybe later, I'll let myself calm down. Keep your hair, Ken. It looks good. Thank you. I appreciate that. But what I would say is that what can we control? So other than voting, we can't control what D.C. does, what the health care companies do. There's things that are outside of our control. You understand that, yes? Mm-hmm. Yeah. But what you can control is, well, we're going to have an increase in health care, but we're going to do what we've got to do on that. We've got to take care of a baby. We've got to take care of our family.

41:36Now, there is some struggle ahead for you all, and it has nothing to do with the health care cost. Because I would tell you that you can absorb that health care increase if you didn't have all those car payments, you didn't have the credit card payments. So you guys are listening to us. You're watching us. You called. McKenna, you've got to double down here. We're going to work. We're going to sell everything. We're not going to see the inside of a restaurant. You know the whole Dave Ramsey rant. And you're going to pay that debt off. And you know what kind of a pay raise that's going to be when we take all that debt combined and we take the giant payment that's going to all that debt and put it back in your pocketbook.

42:13We're going to have the ability to pay the health care increase and thrive.

42:28statistics show that half of americans don't have enough life insurance or they don't have any at all i don't understand this john why don't people want to take care of their family they think they're going to die or something well i used to be one of those guys i didn't even think about it and one of my buddies said hey the only reason to not have life insurance is if you hate your wife and kids and i immediately went and got term life insurance that's a gut punch and oh You're telling me, and for decades, Dave, I've sat across people who've lost a spouse. They've lost somebody important to them.

42:59Me too. They don't know what to do next. Me too. I mean, you're going to have a crisis here. And, you know, you got two options while you're sitting and talking to a young widow. She's concerned about how she's going to invest all this money properly and not mess this up. Or she's concerned how she's going to eat tomorrow. That's exactly right. These are the two options. And take care of your dadgum family, man. Term life insurance can replace income, pay off debts, cover funeral expenses, so your family can actually have the opportunity to just be sad, to just miss you. That's exactly what it's supposed to be.

43:28It's saying I love you to your family. Term life insurance. Jeff Zander and the team at Zander Insurance makes it easy and affordable. I've used them personally for 25 years. They're the only people I trust. Go to Zander.com or call 800-356-4282.

43:59Welcome back to the Ramsey Show, coming to you from the Fairwinds Credit Union Studio. I'm Ken Coleman, joined by Jade Warshaw. I'm excited to have you with us, 888-825-5225. Kimberly is up next in Houston, Texas. Kimberly, how can we help today? Hey, y 'all. How are you? Good. What's going on? So we found an old 401k, and it has about$111 ,000 in it. I love that. You found it like it was over in the corner. We're doing some fall cleaning. Thanks to you, Ken. My husband left that job. He found the proximity principle, and he just found a new career. So the 401k just kind of got pushed on the back burner.

44:43Yeah, I love that. So thank you for that. Oh, happy to do it. He did it. and I didn't do anything. So that's fun. $111 ,000. Did I hear that right? Yes. Okay. So that's the good part. The bad part, we have a slew of credit card debt with three of the major cards having$57 ,000 and the total credit card debt is$80 ,500. Oh my. Yes, I know. So the question is, if we take it out of the 401k and we have to pay taxes and a 10 % penalty because he's under 59. Should we do that? No. No. This was money, whether you remember doing it or not, this was money that you guys specifically set aside for retirement.

45:27Therefore, it's wrapped up in retirement boundaries. And if you pull it out of those boundaries, you're going to be hit with fees. You're going to be hit with taxes. And you're unplugging an investment. So no, I would not do that. What I would do is roll that money to an IRA, a direct transfer rollover, meaning you're not pulling the money out. You're just rolling it over. Therefore, you're not paying the taxes on it. What you need to do with this debt is approach it the way that we would tell anybody to pay off their debt, Ken. And that's using your income via side hustles, via your real income and cut back in your budget.

46:03That's the way to attack debt, not to unplug your future investments. Tell us about your incomes. um together we we do ride at a hundred thousand dollars a year okay and you told me go ahead i'm just gonna say we don't really have any other debt our cars are paid off and we do have a house but that's our only other debt so i'm not picking on you but digging in here what led to eighty $30 ,000. That's not a shopping spree. It's not. So, I mean, some of it was just, we felt like have-tos. Like, we were attacked by Hurricane Harvey, which destroyed our house, and that had to be redone. And then I had cancer, so Andy Anderson doesn't really care.

46:51The deductible has to be paid. And then those are legit, in my opinion, but the other, it's just crap. Yeah, okay. Stuff we knew better. And the reason I ask that is, is because we asked this question a lot. You're calling us on what to do to pay it off, and I love that, but have the both of you had your I've had it moment where you go, okay, despite what has happened, we're not going to play armchair quarterback. We're not doing that again. Are we at that moment? Yes, God love him, and I think he is listening. He hasn't been quite on board with me, and I think he's there now. So So hence the, okay, let's either do the 401k or let's set it into the budget, but let's do something.

47:37Okay. So let's give us, I'm glad you guys are ready to do something. Let's make sure we're making the next right step, right? Because we don't want to do things out of desperation. We don't want to do things with the right intent, but the wrong methodology. Okay. So let's do it the right way. You guys are making what,$6 ,400 a month? Does that sound about right? $6 ,300? It does. Okay. Are you currently investing? still? So the company he's with now, they, I think they pull out a little bit. So they pull out, it's a match on his 401k. Okay. So let's pause that because you guys need all the money you can get to pay off this debt super duper fast.

48:22And I understand that saying that strikes fear in the heart of many because you're thinking, what? I need to stack up the money. But you were just willing to drain a 401k for this purpose. So surely we can go ahead and just pause the investing for now, keep the 111 plugged in. And what we're going to do is we're going to take all these credit cards and we're going to list them smallest to largest. And we're going to keep paying minimum payments like you have been, but all the extra money that you can get your hands on, we're going to throw it at the smallest debt. So when you guys do your budget, how much margin do you kind of have at the end of each month that you can do what you want with?

49:00Not a whole lot. We have a daughter in college as well, so there's not a lot left over. But I don't think, honestly, we're as disciplined as we could be. Understood. I like that honesty. Are you double income? I didn't pay attention. I'm sorry. I thought I heard his income. You are or you're not? We own a small business and then he works for a home builder. And the total was$100 ,000 a year? Right around there yes ma 'am and the reason i asked that question is is there are there opportunities for either one of you to make some more money for a season um i have side hustles because ours is ours is our business is clothing related and so i have all of that um outside online possibilities and then he is a salary and bonus base so yes so what do you do uh a side um or in addition to i should say to the hundred thousand what are you doing with the side hustles what does that bring in oh my goodness i don't have okay a number i can tell you that's okay but it's also not enough that you even it's on your and i i my point here i'm making is if it were a decent chunk that number would be readily available in your brain and i think that's the challenge i'm making or if you're or if your budget if you're really well on your budget fair but it's not a whole lot of money and it's not very consistent.

50:22And so we need to change that as my point, because we got a big hole. What Ken is saying, and I want to double down on this for anybody listening, is when you have a debt problem like this, there's two ways you can tackle it. What Ken is saying, which is money, right? This doesn't happen. It's not a magic trick. You got to put some money into the budget. And the other thing is, yeah, you can cut expenses, but sometimes when you've got a kid in college or you've got daycare or private school or these other things, they are starting to eat at that margins. So there's really only so much that you can cut from the budget.

50:51So yeah, the other part, which is going out and generating more and more income, that can be such a huge part of this. And I think that's going to be the case for you guys as to Kimberly. That's the way this works. There's not, I wish there was an easy button to push, Kim. I do too. I do too. But we have got to get more income. And this is specifically to your case. So let me make another suggestion. And I'm only making this as a suggestion. With these side hustles, in this season where we're trying to make as much as we can to pay off this debt quickly, or as quick as possible, shall we say, you're going to have to weigh your time.

51:32Yes. The amount of time, Jade, that she is putting into these hustles. I could see you doing your coaching. You've done some cool videos where you sit with somebody. I know you. You would be like, all right, how much time a week? And this is the question, Kimberly, that you've got to weigh through. You don't have to answer it specifically because our time is short. But your homework assignment is, how much time am I putting in these side hustles? That's right. Any money-making venture, and how much money am I bringing in? Because I might need to pause all of that and go get myself a job at XYZ to bring an additional three, four, five grand a month for a season to make a big dent in$80 ,000.

52:14plus of credit card debt. When you're in debt, now's not the time to get jobs that you like because you just like it, right? Now's the time to get the high paying job, the high paying side hustle. It doesn't matter if you like it or not. It's a short term sacrifice.

52:47This show is sponsored by BetterHelp. This time of year can be tough. So make sure you check in on your friends, check in on your loved ones, and reconnect with people you haven't talked to in a while. I recently called one of my childhood friends. We had a great conversation. It was awesome. The conversation was hard, but we also laughed a little bit too. It can take a little courage to just send that message or go grab coffee or even get in the car and drive across the country to reach out with a friend. And reaching out for a therapist can also feel hard, but often it's worth it. And if you're thinking about therapy, I recommend calling my friends at BetterHelp.

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54:20All right. So I want to talk about something that's happened recently in the news because we're the largest money show in the world. And I don't want to have our heads in the sand. And so let's just talk about some reality. So saw some data recently jade that 70 percent of millennials Are have a favorable view of socialism Now I make that statement a lot of you get real nervous There's a lot of emotions right now and that's okay because we're going to be adults And we're going to step into something that needs to be talked about And that is the affordability crisis in america Now I start with that data jade because you hear that and you go what?

55:07and some of you may go, oh, these whatever, whatever, whatever insults that you might come up with, you're outraged by that. I understand that emotion. They're outraged by the affordability crisis? No, outraged that 70 % of millennials view socialism favorably. Okay. All right? So then we have a big election, and Mom Donnie becomes, he's an avowed socialist. He becomes the mayor of New York. That creates a lot of emotions. You're going to see a lot of headlines, that guy's name and what he stands for is going to be in the news a lot. So I'm addressing this not from a political standpoint, but from a financial economic standpoint.

55:44Okay. So whatever your emotions and feels are, here's what I want to point out. The reason that 70 % of millennials, and I don't know the numbers on Gen Z, but I'm raising three, but why would a large chunk of Americans view socialism with some favorability? I'm going to tell you why. There's three major financial reasons why. Number one, student debt. We talk about student debt on this show all the time. It's gotten bigger and bigger and more expensive. It is a full-blown crisis. If you've ever listened to me, I've talked about it. I think the federal government should not be in the banking business.

56:22And that's what they're in when they are financing student loans. That's right. And the colleges, Jade, and the universities get the money immediately. they get it immediately so when a kid signs up fafsa and all that junk they get the loan boom guess who gets paid university cash that's right and then these students become young adults become young professionals become middle-aged professionals and then they're calling us and they're calling us under the unbearable burden it feels like now it's bearable we teach them how to get out of it but let's talk about the problem so student loans it's a crisis it's a hook and the federal government is on the back of people with student loans.

57:00Not only is the student loan thing a problem, but the affordability of tuition, Jade, is a problem. The universities keep ratcheting up the cost of tuition. Well, of course they are, because that's money in the bank. They're getting paid immediately. Yeah. Number two, affordable housing. Real estate. I was hoping it was on your list. It's the biggest of the three, but affordable housing. I'm seeing reports that sometime in the next six months or so, we will see the average age of a first-time home buyer, I can't even believe I'm saying this, Jay, be 40 years of age or older. But we know, I mean - And we deal with that every day.

57:33You and I did the math on it the other day. If you're making$100 ,000 and you pick a house for, I don't know,$375 ,000, and we can run the math on that, but you're going to be putting 60 % down for that to be 25 % of your take-home pay. That's exactly right. You can do it, but it's going to take you a long time. Take a long, long time. I'm glad you mentioned that. So add that into the emotion. It's emotional. You've written a book about emotion and money. What no one tells you about money. Well, I'm going to get real and marry politics and economics for a second. The third factor, the skyrocketing cost of health care and the spotty coverage.

58:11We take those calls every day. Now, if you're still with me, and I don't care if you're a conservative or a liberal, I'm not making a political statement. I'm talking about the reality of the affordability crisis in America, and I've given you the big three. It's expensive. Now, let me play this out. And I'm not justifying anybody's views on socialism, but I am a realist and I'm a co-host of the largest money show in the world. And we help people dig out of these problems. Now, you take those three things. Let me review very quickly. Student debt, unaffordable housing, skyrocketing health care with spotty coverage.

58:52You take all three of those things and you put them together. And millennials, younger millennials for sure, Jade, and Gen Z, they have never experienced positive capital. What I mean by that is the true usage of the word money. they feel like they have been and they are behind the eight ball for anyone if not all three of these combined understood so therefore the system of capitalism as they know it doesn't work very well they have to listen to us old heads to try to tell them so me dave i'll say it i'm all pro capitalism but i am being realistic today as a 51 year old gen xer who has thrived because of capitalism.

59:37My experience with capitalism is very different than theirs. And so I'm just simply pointing out for a moment, because this could tear our country apart, and I'm going to make a case today to bring it together. Ken, go for it. Okay. So there's the setup. I don't think that they're evil. I don't think they're idiots. I don't think they should be ridiculed and made fun of and marginalized. I think they need to be stood up for. And so I'm going to make a suggestion that those of us who have won because of capitalism and experienced the fruit of it, the burden now becomes on us as we the people, if we believe what we say we believe, that we now have to collectively put pressure on all politicians, local, state, federal, both sides of the aisle, and say, maybe we the people should vote these lunatics and these idiots out if they don't work on policy by creating policy or changing policy to make things affordable.

1:00:42Period. Now, I can say that as a host of The Ramsey Show because I am not at the mercy of someone with an opinion because I have an experience. I've A, benefited from capitalism, and B, I've coached thousands upon thousands upon on thousands of people and we will take more calls today of people that are dealing with this affordability crisis in America. And we, the people have one option to start to collectively say, let's take on these three issues. And so as a, as a guy who gets this unbelievable privilege from a money perspective and you don't come at me because A, I will not read the comments and James Charles will tell you.

1:01:22What can you come at, Ken? I feel like that's the most reasonable thing that I've heard in a long time. Both parties are on the hook for this. Don't come at me. Both parties are on the hook. Yeah. And we the people are on the hook to say, wait a second. Let's take these three issues alone. Affordable housing, the student loans and the tuition crisis and health care costs. And let's do something about it. And we've got to make our voices heard. I'm not talking about violence, but I am talking about the one thing that these politicians care most about is their preservation, Jade. They just want to keep getting reelected.

1:01:57They just want to get voted in. So at some point, this is coming to a head. And I don't want our audience to get sucked into what the Mom Donnie election means and what millennials flirting or liking socialism means. Don't get fearful. Get active. Because I can tell you this, if anything unites the American people, it would be those three issues. Yeah, we can all agree that it's outlandish. That's a big tent. Yeah. That's a big tent. I think we could all say, how many in this giant audience think that housing affordability should be lower? Yes, everybody. Everybody's raising their hands. How many in this audience think that healthcare should be more affordable and better coverage?

1:02:38That's everybody in this audience. How many people think that the rising tuition in America is out of control and the student loan thing is a crisis and we should get out of the student loan business? How many think that maybe these universities should raise their own freaking dollars or Or use what's already in those giant downloads and pay for bright young students to get educated. Every hand in the audience goes up. I'm not running for anything. I'm just pointing out that what could break our great nation is this affordability issue. And it's solvable. And I will say to our large audience, Republican, Democrat, independent, libertarian, conservative, liberal, we probably should unite on these issues and say, let's make our public servants do better on policy, Jade, to make these things better.

1:03:25And I bet you we'd have a far greater union, a far less stressed country, a far less pissed off electorate. I just I'm throwing it out there. Ladies and gentlemen, Ken freaking Coleman on the topic. Way to go, Ken.

1:03:53We'll be right back.

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1:05:39All right, this is fun. We're going to go to a video call from Breanne. I hope I'm saying that right in Portland, Oregon. Breanne, hi, how are you? Hi, guys. Thanks for having me on. Oh, we're thrilled to have you on. You look fabulous, by the way. So fun. Love the video call. What's going on? How can we help today? I have a spending addiction that I just can't seem to get over. I've been trying to follow the baby steps, but it's really hard for me. So I'm just kind of looking for your advice on that. Tell us a little bit more. What is this? What can you or what do you feel comfortable telling us about this particular addiction?

1:06:14Is it just across the board spending or is it one or two categories or one thing? What is it? Yeah, so it's fast food because I have such a busy schedule that I don't plan for making dinner. So I spend money on fast food. I spend a lot of money on my daughter. I spend money on other people. And then like at the bottom of the list is splurging on my own stuff. Okay. And give us an idea. Have you been tracking how much you're spending in all these categories on a monthly basis? Yeah, I use every dollar. So it's probably about$1 ,000 to$1 ,200 a month. Wow. And what's your total income for a month?

1:06:55It's about, oh, for a month, it's probably$4 ,800. Oh, so ma 'am, you don't have the margin to be splurging like this. Right, no. I mean, that's like if you do have a$2 ,000 a month, that's half your income. Yeah. Do you have debt as well? I do. I have a total of probably$90 ,000 in debt. Whoa. Okay. You know, we're going to break this down. Give us the list, smallest to largest. Yeah, my medical debt is a little over$4 ,000, credit cards$9 ,100, and then personal loans$51 ,600, and my student loans are$20 ,000. Who are these personal loans to? so before i found you guys i had a debt consolidation loan okay and then we got pipes on our house back when i was with my ex um and we're still paying that off and then a car so if i shoot straight with you i mean i'm wondering if i already heard it um when you were talking about your ex what do you think's behind this because there's always something behind it what's trauma definitely trauma um and i'm trying to work through that But I'm trying to figure out how to stop this overspending while I'm working on my trauma history.

1:08:15Are you, when you say working on the trauma history, are you seeing a professional? I am, yeah. Great. And you feel like you're making progress? I think so, yeah. And I've started a couple groups with some others who've been through the same thing. Okay. So, I'm thinking through this. I'm trying to be thoughtful here. If it were a spousal situation and the two were together and one of them had an addiction, I would say this person doesn't need access to the money. I'd say the other spouse who is able to take care of the money, who can be trusted to take care of the money needs to help. So I'm almost wondering if there's someone in your life who can be that person for you to say, hey, let me walk alongside you to make sure because with$4 ,800 and with a daughter and with$90 ,000 of debt, we cannot keep spending$2 ,000.

1:09:03Is there someone that you can trust to kind of walk with you and kind of not take you out of it completely, but for them to be more in charge of having that accountability with you? Yeah, I have a close friend who's actually offered to do that for me. It's just releasing that control of it. That's hard. But here's what we have to ask ourselves. What if we don't? What if you keep doing this over and over? Where will you, you know, a year from now, you're going to look up and say, okay, am I going to be the same? Am I going to be worse off or I'm going to be better? And right now, if you continue down this path, you're going to be worse off.

1:09:44Yeah. So something has to shake. Yeah. Okay. So first of all, can I say something? You're amazingly brave to call in on a video call and go, hey, I have a spinning addiction. So I want to tell you something because I think you need to hear it. You're way tougher than a lot of people. So I want you to harness that. Now, I'm a big fan of therapy. I am no therapist, nor have I played one on TV, nor am I going to try to be one. But I would love to know, what has your therapist said to you and that you're comfortable sharing as it relates to tools or some type of process that they're probably giving you?

1:10:22When you get to an emotional place, and let's say we're driving home, and you know you've got an old pot roast in the fridge, but you really want to pull over to your favorite place and get a combo, tastes good, feels good, all the things. What has been shared, if any, from your therapist on tools or how we're processing? Because I'm going somewhere with the answer. What can you share? So I'm in EMDR therapy and she has, we recently worked on this where you kind of go and play from the beginning of the scenario. Like I'm driving home and then play through the scenario. What would happen if I were to go drive to this fast food place and get a burger and then drive home and then there's that meat in the fridge that's almost ready to expire?

1:11:10So kind of walking through it and then reshaping it in your head what it would look like if you were to just drive home and use the food you have. And has that been helpful? I haven't really used it yet because it was just this last week. Okay, great. So when was the last time, and so you're being real with this, when was the last time that you spent in one of those categories that you led the call off with that was the addictive stuff? When was the last time? Probably last week. Okay, good. Okay. So the reason I went to this is I love what you said, Jade. I think in this situation, you have got to get to a place where while you're getting the help and the therapy and you're dealing with the trauma, you've got to find something to replace that band-aid spend and you've got to find something that goes i've got to look at something else and instead of something that makes me feel good i would start thinking about something that makes me feel really bad attached to said spending right so if i'm tempted to buy something for my daughter because i show her love and by the way i've been guilty of this and you're smiling.

1:12:18It makes you feel good. See, you feel bad about yourself a lot, don't you? I do, yeah. So when you buy something for your daughter, it makes you feel really good and the endorphins release and there's dopamine and you're like, okay, I feel really crappy. Let me go buy something for my daughter. What I think you're going to have to start doing is, is like, I feel crappy. How do I process these emotions? What are the tools my therapist has giving me, that's first. Second, if it were me, Jade, I would go to, if I buy something for my daughter that I cannot afford to make myself feel good because she shows me love and happiness, I am further penalizing her and me and putting me further in a hole.

1:13:02And that's what I mean by going to the negative consequence of the addictive spending. I think you've got to spend more time there to go, oh, the pain of that is far greater than the pain I'm feeling because what somebody did to you and said to you. What are your thoughts on that? I mean, I think that's all valid. I go to the practicality of it. I go to James Clear and I think about systems and putting those systems in place so you can actually win. That's why I mentioned what I mentioned earlier. If I were in your shoes, I think it would take an incredible amount of willpower, but I think I would go tonight and I would set up everything on automation.

1:13:35And I would say, when I get paid on these days, my bills get paid automatically. And do you want to know what I would do? I think that I would cut up my cards for a while. Oh, yeah. Yep. Do you have them close by? Because here's the thing. If you need money, you can walk into a bank, you can withdraw it. That requires a lot more work. It requires a lot more thought. But in that time, that also gives you the time that if you're feeling that way, you can call your buddy up and say, hey, remember I told you about this thing? I need you right now because I'm about to go in here and make a withdrawal slip so that I can go buy myself a burger so I can go buy my daughter something.

1:14:10And so now we put another level of friction in between you and doing the thing that you know you shouldn't be doing. And I'm no therapist. I can't even pretend to be one, but that's just something on the practical level that could help you today. All right. Speaking of practical, are your credit cards close by? No, I don't know. They're across the room. Okay. If we were to give you an opportunity, say to walk across the room and get those cards and bring them back on camera? Would you cut them up right now?

1:14:46Maybe. Wait a second. You called. You called us. And you said, I need help with addictive spending. I think Jade makes a good point. I think we cut them up now. You give yourself a certain amount of money for groceries, let your buddy hold it. You in or not? We're not going to force it. You in or not? You want freedom? So my debit cards to my bank account? Not your debit. your credit card. You want to cut them up? Oh, I already cut out the credit cards. She cut them up. I would have let the debit ones go too.

1:15:41All right. That was real, real. Yes. You know, like when you talk to somebody like Brianne who's dealing with a spending addiction, owns it, that she's had some past trauma, a single mama. I mean, that's as real as it gets. And that's tough stuff. And, you know, you were sharing with me, you know, you were sharing with her. I think for her, for anybody that's in those shoes, I thought you had a really great, here's what I would do step by step. And I wanted you to share that because I think it's really good. I mean, you did with her, but I'd love for you to really recap that. Well, it's definitely probably the most extreme piece of advice I've given, but she seemed like she was in an extreme situation.

1:16:18And I said, I would automate my bills, you know, whatever her bills are, rent, car, insurance, so that they come out of the account automatically when she knows she's paid. And I would get with a friend, an accountability friend and say, hey, I don't go to the bank to withdraw money unless you're with me. And I can go to withdraw money for groceries and I can withdraw money for gas. And then you go with me to the grocery store and you go with me to the gas station. And that is that's just a practical thing, because we said that can because if it's a spousal situation, we can give the money to the other spouse to handle and we can lock ourself out of it.

1:16:52She has to find a way in a system to lock herself out to keep her safe until she can work through the trauma with her counselors. so. And by the way, I mean, the all new EveryDollar app, and it's really no longer, it's not an app. I mean, it is such a, I sat with the team the other day and you are going to get what you get on this show, 20X. In other words, it's a digital coach. Yeah, it is. And you answer the questions, you dive into it. It's going to send you specific content. You get an actual free 10-minute coaching call with one of our actual coaches. If you're in the shoes of Brianne or anybody that's going, hey, I need to get control of my money, I'm telling you every dollar is the play.

1:17:37The average person, by the way, is finding thousands of dollars in margin in the just first 15 minutes. By the way, if you take 15 minutes and answer questions honestly, what you get in return is a digital coach walking alongside of you. It is so fantastic. Start every dollar for free today by getting it in the App Store or Google Play. Josh is up in Tampa, Florida. Josh, how can we help today? Hey, thank you guys so much for taking my call. I really appreciate it. Yeah, you bet. What's happening in your world? So me and my wife, we rent currently, and we're contemplating whether we should buy a home or not.

1:18:16But we do have some debt that we've been knocking out. We've been following the baby steps and have every dollar. We've been really attacking it since about February. But total debt we have between everything is$73 ,000. And so we bring home together, bring home about$8 ,600 per month. And after bills and everything is paid for, we're doing pretty good. We have about$1 ,500 a month left over, which is what we've been doing attacking the credit card debt we have and we've already paid five off since February so we just really just um you know got our our savings and everything um good to go through baby step one so really my question is should we just keep attacking the debt our rent is relatively cheap what is it um 850 850 so what's the rest of this money going on minimums because 8600 is a lot of money it's just you and your wife right there's no kids yet no we have a four-year-old and then we have a baby on the way actually oh congrats so give me like 850 is super cheap where where's the rest of this 8600 going towards because usually the big ones are rent daycare insurance um so where where where is yours is it car payments yeah so we so My wife's car, we owe about$9 ,000 on.

1:19:39Okay. My truck, we just got over the summer because we knew we were, my car was small, so we knew we had to get something bigger. Now. And what's the payment on that? I know. $7 ,000. Okay. There's some of it. What do you owe on it? $42 ,000. Listen, my guy, you already know what I'm going to say. I do. Drum roll. You got to sell the truck, my guy. You got to let it go. I think you better cut it loose. Let it go. You got to cut it loose. And I'm serious, by the way. I was making jokes. But listen,$710. I applaud you for putting$1 ,500 of margin on. But when I hear$8 ,600, I'm thinking it's going to be a lot bigger of a shovel than that.

1:20:24So the$710. I don't know if you've looked, but what could you get for that truck, Kelly Blue Book, private sale?

1:20:35I haven't looked. I would guess around$38 ,000. $38 ,000? Okay. So if I'm you, would you rather have$4 ,000 of debt or$42 ,000 of debt? Right. True. So I think that's the play. Now, you've got a little bit of time. You're not pressed for time. I don't think you need to go get a loan for it. I think you can save up the difference because I think you do have more margin than you think. We're going to give you every dollar if you don't already have it. Do you have it? Yeah, we do have every dollar. We do have every dollar. Okay. Go through that budget and crunch those numbers because I think you have more margin than$1 ,500.

1:21:12Because I want you to save up$4 ,000 really fast to clear this. Can I jump in on this one? Yes, Ken. She's right. But I wonder if you could earn$4 ,000. You're a young guy. Yeah. You got some skills. Yeah. I've been doing DoorDash on the side just randomly. No. We don't do DoorDash randomly. Sorry. I was all fired up and then you stepped into that one. You've got limited time, correct? Correct. And we need, have you ever heard the old phrase, time is money? Right. So we don't, and listen, I'm not knocking DoorDash, but in your situation, I believe you can make a whole lot more money than you're making for the time you're exchanging.

1:21:53Do you agree with that? Sure, yeah. All right, what skill sets do you have? Let's get real. What skill sets do you have, experience do you have in the workforce?

1:22:05Well, so I'm a Navy veteran. And then so my job in the military, I actually do. I'm a minister. So we that's that's what I do. And then my wife is a banker. okay um and then you got any trade skills you got any you know uh you know where you can sling a hammer or do anything like that uh renovation work if you can't can you work in a manufacturing situation and work the crazy shifts and make really good money now or slinging boxes around you get my point absolutely in other words what can you do in your area that'll make you the max amount of money to get back into where Jade's talking about. I want you saving.

1:22:47She's right. But what if we could also, what if Jade, we could save for and make for back to you? I love that because now you're going to have the cash to buy something that's older, much less expensive, way more miles, right? But it's just a bandaid until you can get the rest of this debt paid off. Then you can move up in car. Now here, let me tell you what's going to happen. You're going to get off this call. And what we have said to you is really going to sink in. And you're going to say, hold on, they told me to sell my truck. I just got this truck. Wait a minute. They're telling me to work extra hours.

1:23:20I have a pregnant wife. And you're going to question whether or not the first thing you called in, which is you want to be out of debt. You're going to question of if the methodology is worth the result. That's what you're going to question. That's what your emotions are going to cause you to do when you go home. then you're going to tell your wife about it and she's going to add hers to the mix and you're going to have to sift through all that. And what I'm asking you to remember is what I want you to sort through what you want now, which is you want to keep your car and you want to be home. But I want you to compare that with what you want most.

1:23:56So you need to think about that tonight. What do you want most? Is it the way the house feels when you bring the newborn baby home? Is it how it's going to feel to be able to sit down with your wife and the debt not come up in the conversation and cause another fight, right? These are the things that you need to think through because what we're asking you to do is not any small little thing. Right. Fair enough. But you're also talking to people who have done the things that we're, we're not, Ken and I are not going to tell you to do anything we haven't done ourselves. facts. I'm curious, Josh, have you felt some frustration recently about this whole money thing?

1:24:34So at the beginning of the year, yes. Once we found you guys and started doing, you know, the baby steps and every dollar and then, you know, we cut out a lot of, I mean, we found that, you know,$1 ,500 a month that's over, basically. I'm going to tell you something. When you get off the call, like she said, you're going to feel a range of emotions. Can I give him, I know it's before it comes out. Do it. Let's give him a copy of What No One Tells You About Money. It's the emotional playbook here. It's so needed for you, my friend, because she's right. What we told you to do is not fun. So hang on the line.

1:25:07We're going to give you a copy. It's not even out yet. We're going to give it to you because you need this book. So Jade's new book, What No One Tells You About Money, available at RamseySolutions.com slash store. Go pre-order it now.

1:25:44We'll be right back.

1:25:54slash agent, ramseysolutions.com, slash agent.

1:26:11Welcome back to The Ramsey Show, coming to you from the Fairwinds Credit Union studio. Alongside Jade Warshaw, I'm Ken Coleman. So excited to have you with us. The phone number to jump in so we can help out is 888-825-5225. 888-825-5225. Alan is up in Dallas, Texas. Alan, how can we help today? Yeah, thanks for taking my call. Sure. My girlfriend and I are in our 60s. We are financially independent, and we're discussing marriage. And this would be the second marriage for both of us. And I've heard numerous times on your program, there is no his or hers in marriage, which is just ours. Yes. Our situation, I think, may be have extenuating circumstances, and I am needing help processing those variables before she and I sit down and discuss it.

1:27:03Okay. Well, so let's start with these extenuating circumstances. I doubt we're going to change our opinion, but hey, give us a shot. What are these extenuating things where you go, I don't know, Ken, we may be the one case where we keep everything separate? Sure. Well, okay, we each have a trust, and those trusts are set up for our estates, our children, our grandchildren. Okay. And we would have a prenup to protect them. Sure. In the event one of us passes. We're both Christians. We're a faith-based marriage. We volunteer. We work for our church. Sure. So the prenup's not because we might get divorced.

1:27:41It's what happens when one of us passes. Sure. Okay. We each own our homes outright, and we'll keep both of them, but we'll live in hers. And if she passed before I did, I would be able to stay in that house as long as I wish, but then it would go to her children. Okay. Okay. So what I think about is home improvements, let's say. well if we do home improvements it's it's her house i benefit because i live there but in my opinion that's something that she would pay for and if we bought one of us bought a new vehicle well whomever wanted that vehicle would be the one to pay for it um so you keep it separate yes keeping those separate well if you keep that separate you are keep let's be honest like i i do think if you keep things like buying cars separate if you keep things like doing home renovation separate i mean your money is separate i i don't mind the fact of you guys protecting the trust through a prenup it's almost like the stuff that was in the past i'm okay with it being protected and having that protection around it but the things that are you you're doing going forward i'm okay with that being together because if you buy a new car, is that in the trust?

1:29:08No, that's, that's you guys living your current life together. And so you guys together get to decide who, you know, what will happen to this if either of us passes, that sort of thing. And, you know, with the houses, I might be inclined for you guys to do something where you don't keep both of those homes and you buy something together and start your life together. Because the more you keep things separate and try to keep your previous life alive to a certain extent, it's going to be very messy for you. What's the benefit of keeping both of your old homes versus selling them, taking the money together and buying something you really like together, and then willing it that it's split equally amongst your heirs?

1:29:52She really loves her home. Like she loves her home. And I am not overly attached to mine. I would actually keep mine my home is near my kids and so I would keep it as an overflow house I might stay there some we might stay there some when I have other kids come in from out of town it would just it would be kind of just for my family's use yeah I slightly different I don't mind Jade's suggestion but I'm not I'm I wasn't going to make any changes on the house thing I'm with you Jade 100 % I think the trusts are what they are. I think the houses, again, it's a sticking point because your wife to be, we're going to assume that you guys get married or your girlfriend, that house she's got in the will, it's going to the kids.

1:30:44They've got separate kids. I get that. But I would say to answer your question, I do think your finances need to be combined. I agree with Jade. I just, I don't really care about the houses, the house situation and the trust. I'd say it's kind of excluded, but I agree with Jade 100%, and I don't think we change our tune. Unless you have some sort of trust issue with her in combining finances, which you shouldn't get married anyway. He's wondering about making upgrades to her house. I know. I'm getting there. I think I'm with you. I agreed with you that whether it's her house from the past or not, if they're living there, it's not the renovation for the new bathroom comes out of her account.

1:31:24No, it's our account. I think you guys should combine checking and savings accounts. You are married. You're doing life together. The trust and the house is being, staying where they are. Totally fine with that. But if he puts money into that house, but it's all aired to her kids, what does that mean for him? Is, is that's the right? Am I, am I wrong? That's where he's hung up, but I'm saying I agree with you. But, but that's the part it's, that's going to be very hard to navigate. Cause then you're going to have to every year do some sort of thing to the trust where you're saying, uh, you know, here's the value of the house but this much is going over to you know his side of the family i'm telling you and that and that wouldn't happen and that wouldn't happen why i would think so here's here's devil's advocate okay i'm living in this house for free right she's not going to charge me to live there you're married to her and that hold on let me stop because that is the crux of all of this as long as this persists that will be the the the language and you've got to be able to move past that.

1:32:25And the only way to move past that is to say, okay, what was in the past is in the past. And sometimes when we enter into a relationship, there are sacrifices that we make for that person. That's just part of it. When Sam and I got married, I moved from where I was living and I moved in with him. I changed my name. I sacrificed certain things about my life. He sacrificed certain things about his for us to come together. And I think it's the same thing for you guys, it's just harder because you're 60 and you're in your life and you're in your ways. And there's things that you've grown accustomed to.

1:32:57And I'm not, I get it. But if you truly want to make this simpler for yourselves and get the language of we, you've got to let go of what was mine. That's all I'm saying. I agree. Listen, and by the way, you do what you want to do. You called us. So keep in mind when you call us and you push back on something that we believe, We're going to push back again. And again, we're all friends. That's right. You're very wise. You guys are in great financial situation. I just think you're overthinking this. And if I was in my 60s and I was in your situation and I had found another love and this was my opportunity, I would not be calling me asking the questions that you're asking.

1:33:39I'd be like, babe, let's live it up. Let's go. You know? I don't know. I'd be like, well, what's going to happen when I put$50 ,000 into this renovation? I'd be wondering too. Yeah, but you're like contradicting yourself. No, because it's his house. If you're like, babe, I'm ready to go, but we move into your house and all my money spent renovating your house, that's going to go to your heirs. How much money are you going to spend on this woman in a year just because you love her? How much? $100 ,000. Yeah, get over the freaking kitchen renovations, man. Listen, I'm looking across the glass and Will Rudder is right on with me.

1:34:16He knows what's up. But you're marrying her. the house and exactly if she wants a kitchen it's called happy wife happy life then i might be like let's go buy a house where we both love the kitchen together you're spending more of his money i'm fine with that too you know what i'm saying i get where you're at but i mean the way he's asking it i'm just like we're worrying about stuff that quite frankly in your 60s getting married a second time you shouldn't be worried about

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1:36:03All right, Jade, I'm gonna tell you something you already know, but everybody needs insurance. See, you knew that. I did know. Yes. But it can be a little bit sticky. It's not fun, let's be honest, most of the time, trying to find out who's looking to make a buck versus an agent who knows their stuff and they got your best interest in mind. But that's why you need a Ramsey trusted insurance probe because you never have to deal with all the sleazy, gross stuff because Ramsey has vetted these fine folks and they care about what they're doing. They care about you. They have the heart of a teacher.

1:36:35They have your best interest in mind. So go to RamseySolutions.com slash coverage to find the type of insurance you're looking for because keep in mind, you're trying to win with money. Some of you aren't covered enough, and so if something bad were to happen, it could really knock you off the path. Or some of you are overinsured, and you could use a little bit of money back in that every dollar budget to get ahead. So go to RamseySolutions.com slash coverage. Stephen is up in Montgomery, Alabama. Alabama, rather. Stephen, how can we help? Yeah, so mine is kind of a two-part question, I guess.

1:37:10I, me and my wife, we are looking to purchase land and build a house, but I want to be debt-free before doing so. I'm self-employed, and so I'm trying to figure out, out of my savings that I currently have, how much of that can I put toward my debt to not drop my savings too low since I am self-employed. and so just trying to figure that out and also trying to figure out how do I figure up when it is time to buy the land and build the house what I can afford with what I make if that makes sense because you know trying to get out of the debt as big as possible helps me get to that point. Do you have so when you talk about your savings as a self-employed person do you have money set aside in your business as retained earnings and then you have a personal savings set aside or how is it?

1:38:00How's it arranged? Yeah. So there's a little bit. Yeah. So there's a little bit in the business and then I have a separate set aside and like my personal account, basically. Okay. I would keep what's in the business in the business. I wouldn't pull that out. How much is it? Just curious. And so in the personal combined is 60. So in the personal 50 and then the, in the personal 50 and then 10 in the, in the business. Okay. Yeah. What kind of business is it um so it's um new roofing okay yeah i'm gonna go ahead and keep that 10 000 there i think i'm not sure how your business runs but my guess is it's there for a reason um and you want to keep being able to run i guess is yeah yeah so i own i own the business so there's obviously in in that business there's a lot more money than what's in i should have specified that basically that pays my corporation so my corporation is on top but in the actual business because i own it with a partner there's a lot more money in that so that business pays my corporation if that makes sense got you um i would keep that separate for now okay because it seems like it's going to be cleaner for you but you've got fifty thousand dollars saved that's your money let's talk about that um the way the baby steps work which is the framework that we're always going to teach people how to handle their money through, is the first thing you need to do after setting aside$1 ,000 just as a basic barrier between you and life, the next thing we do is we take all the money we can find and we throw it at our debt.

1:39:35That includes savings, income, selling things, selling off stocks, crypto, that sort of thing. Basically, everything's at stake except your retirement for the most part, right, Ken? And of course, you don't have to sell your house, but you see what I'm saying? So for you, yeah, I would keep a thousand dollars aside and I would take 49 and I would throw it at whatever debt you have. How much debt do you have? We just had a baby. So I don't know what that amount is. Without that, we're looking at 50, 55. It's for two vehicles and some back tax stuff from when I was a teenager, basically. Tell us about those vehicles.

1:40:12What do you owe on each? so i owe 15 on one 30 on the other what are they worth um truck that's i owe 15 on and it's basically my work vehicle is probably worth 20 and the suv um is worth basically what what i want it okay so i would be looking to get out of that suv today instantly and then i would take maybe$8 ,000 of your money that you have saved and buy something in cash. I agree. And let me play the math on the back end of that advice. She's right. What is that SUV payment right now? Monthly. $5 ,000,$5 ,000, somewhere around there. Okay, so if you do the math, like Jade told you, so she's giving you an$8 ,000 car is not going to be exciting, but it is going to be functional.

1:41:05And it helps get you going on this. And now not only that, you've got it. You freed up another$500 a month to throw at debt. That's why that's a beautiful recommendation. And you're not going to have to now drill down on your savings as much as you thought, because now you can reach over. You can pay off the$15 ,000 car. And then what's that leave you with? Another$15 ,000 somewhere. What else did you have? Two cars? Yeah. So there's the two cars, which is$13 ,000,$15 ,000. And then there is$9 ,000 in back taxes. Okay. Okay, and then you can reach over and you can pay off the back taxes. Correct, yeah.

1:41:43What do you think about that? So even with, so I don't mind that at all. My worry was being self-employed if we're going to get slow or something happens. Well, you'll still have, you'll still have, you will only have to pull$24 ,000 actually plus the eight. I forgot about that. So you'll only be pulling$32 ,000 from the$55 ,000 that you have saved. Okay. That's enough. Oh, I'm sorry. Is that right? I'm sorry. I had it written down backwards. So you'll pull 32 from the 50 that you have saved. So that leaves you with a little bit. Yeah. What do you pay yourself a month?

1:42:23That's a long story. But it's right now about 10. All right. I say about 10. 10 to 15 is what I get per month. But see that urgency to get that back up because that's what you're worried about. something were to happen you're going i gotta get paid yeah but you have bigger problems right so it's like what happens when somebody gets advice like this they go well let me think of the absolute worst case scenario and that's why i don't want to pay off my debt but here's the deal if the worst case scenario happens number one you got a bigger problem than than the fact that you paid off the debt you've got a problem with your business but but what's nice is if something were to happen you can scrap buy a whole lot better longer if you don't have all this debt yeah So I just want to make sure you see the entire picture here.

1:43:09Well, you're sitting in a better situation. Yeah, no, that makes sense. If you did what I told you to do today and tomorrow, and then Monday came and the worst happens, you would have$18 ,000 of emergency fund. You would have$10 ,000 reserved and you're part of the corporation. You would have no debt. That's pretty awesome. Yeah, no, that makes absolute sense. So you wouldn't have to worry about making truck payments and car payments. You wouldn't have to worry about the IRS breathing down your neck to get that money. I can't believe how nonchalant you are about your back taxes from when you were a teenager.

1:43:46I got to tell you, I heard that. And man, I broke out. I need a Benadryl on the break. It was way higher. Huh? It was way higher. I don't care. It was way higher. I don't care. It's still around. That sucker's got mold on it. It's been around so long. So the question America wants to know is, are you going to do it? Which part of it will you do and which part of it won't you do? You can be honest. Tell us. Yeah, we won't get it. So the one that worries, I say worry, it doesn't worry me, is we have to find a vehicle that we have four kids. Listen, not a problem at all. Don't give me the four kids won't fit in a standard SUV because they will.

1:44:28And hear me when I say. Not that. I'm talking about reliable. That kind of worries me. Same deal. But still, hear me when I say, if you had called in and you didn't have$50 ,000 saved, I might be more of a stickler about this. But you've got a little bit of money saved. If you want to spend$10 ,000, it's not the end of the world. The point is you're buying it in cash. Do you see what I'm saying? I just bought my kid a couple years ago a$12 ,000 SUV. And that thing's running like a top. And you could put four kids in there. In fact, I've seen him with five teenage boys in there. So I do this all the time on the show.

1:44:59cracks James up, our fearless leader. I get online. I use that with minivans, so minivans work too. Yeah, there you go. You get what you need. But my point is, the point here is to get rid of the debt and to buy vehicles from here on forward in cash. That's the point. And you get to decide how much of this you're going to keep as your emergency fund. And then you can quickly stack it up to three to six months of expenses. And you're going to be sitting pretty if you do that. Speaking of sitting pretty, I was laughing listening to him because when I was a kid, we would be on long road trips and I would take a nap in the back windshield.

1:45:32That's how our parents did not care about seatbelts. I literally would lay in the back. You know what I'm talking about. Oh, yeah. No big deal. Just back in there. Nice warm place to take a nap.

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1:46:44All right, in the lobby here at Ramsey Solutions on the debt-free stage, I see two fantastic-looking people over there. We've got Thomas and Amy on the debt-free stage. I guess you're here to do a debt-free scream, is that right? We are. Yes, we are. All right. Where are you all from? Washington Courthouse, Ohio, just about an hour south of Columbus. An hour south of Columbus. Yes. Okay, fantastic. All right, well, give us the numbers. How much debt did you pay off?

1:47:13$138 ,661. Wow. How long did that take? Five years. Five years. Okay, and what's your range of income during that time? We started out at$101 ,000, and we ended last year at$143 ,000. I think we're going to beat that this year. Oh, good. What do you guys do for a living? I'm a regional coordinator for an international Christian ministry, a fantastic one, Samaritan's Purse. Oh, sure, sure, sure. I've traveled with—I've gone on trips with them in my past life before Ramsey, the work I did. So I love the organization. Awesome. Yeah. And you? I'm a correctional officer. Okay. You have that look and vibe.

1:47:54Until you smiled, I was a little nervous talking to you. I'm not going to lie to you. Did you get that vibe from him? I don't know. I feel like it was more than meets the eye. I love it. Okay. Now, what do you attribute the growth in income over that time? Well, we've done a little bit of everything. We gave plasma for a while until we got a little concerned about our health. And I worked a second job. I would go in and work from 4 o 'clock to 7 o 'clock and then go change clothes and go to my real job. Wow. Tom DoorDash for a while and lots and lots of overtime. That's what he's doing right now.

1:48:31So we're looking at some people who know what it means to be gazelle and tense. Yes. Fantastic. Well, what kind of debt was the$138 ,000? A lot of everything. Yeah. We had a couple of car loans. we had credit cards, a parent plus loan, some medical bills, and just a menagerie. Wow. So what was the point that you, it is, what was the point that you looked at it and said, something needs to change here? Well, actually 10 or 11 years ago, one of my co-workers in one of my previous lives had given me one of Dave's books to read. And I read it and thought, this is really great and gave the book back to her and went on about my life, which wasn't very effective.

1:49:17So, um, and then I joined Samaritan's Purse and one of the fantastic benefits that they offer is Smart Dollar. And so I joined Smart Dollar and started utilizing everything, watched lots of videos and still we were kind of ish, but then 2020 happened. And while Tom was considered essential. I thankfully was blessed not to lose my job. We worked our tails off, but we did it remotely at home for a few months. But it made me realize that something had to change, like, because it could have been very easy that we were one of those people that lost their jobs. So we kind of got started there. And that's when Tom really got on board.

1:50:02um yeah i was ish yeah he was happy he was happy for me to be the nerd and and let me do all of the things that i love all the financial guru all the details so well not a guru or we wouldn't have been 138 000 worth of dollars well it's interesting you say this because i i love that you mentioned smart dollar smart dollar obviously is is everything we teach our program for organizations and it goes through as a benefit to hr and all that so when you start to experience that and you come home from work and you start telling them, Hey, there's this plan. I think it's going to work. You're pretty fired up.

1:50:38I'm guessing. Is that correct? Oh yeah. And then Tom, I mean, you, you had to be going, what? So what was the hardest part for you, uh, to, to, to get on board with? Um, I just, I didn't really pay attention. I just was like thinking it didn't really start meaning anything to me until I started getting closer to retirement. For me, it was about our kids. They played sports, and we was all involved in that growing up. I just thought that was just what it was. You lived with it, and you did the best you can with it. But then the more we went on to it, she was talking in my ear and getting me to watch some of the things on the videos and stuff like that.

1:51:24I've memorized the videos, but he was forced to watch them. And about two years ago, you know, I started getting able to work a little bit more overtime. So then I started putting in the time and really getting involved. Yeah, that's awesome. I love that. So what would you tell somebody who's kind of on the fence, who says, I've read the book, but I put it back on the shelf. Or I have the benefit available to me, but I don't need that today. Well, the program works, but you have to work the program for it to work. So reading the book and doing nothing with it. Communication. Yeah, it doesn't work.

1:51:58So just being intentional and doing what you need to, taking the next step, doing the next thing. My problem is that I'm too detail-oriented, and I wanted all the things to happen. I could see the end, but I wanted to pull it this way and make it go quicker. So just knowing that there is timing and God's timing, you'll get it done. You just need to be intentional about what you're doing. But yeah, definitely communication and making sure that you guys are walking in the same direction. Cause if you're fighting your partner, it's never going to work. That's right. You gotta, you gotta fight the thing.

1:52:35That's really the enemy. What kind of support system did you guys have? Each other and our two sons, our two sons, actually, we, we had one in a senior in high school in 2020 and a senior in college in 2020. We didn't think that through when we had children, eight years of college. But we were committed to cash flow as much of that as we could. And they are both on plan. So we talk to them about it all the time. And they're working their own plans right now. I love that. And their kids' grandparents, they took care of them whenever we were working or stuff like that. They helped out sometimes whenever you need that little extra.

1:53:20Of course. You can't make the ends meet. Sometimes they help out there. Yeah. I love that. The hardest part for each of you. Tell me. I want people to hear the real, real. What was the hardest part of this journey for each of you? That it took five years. Five years is a long time. I wanted it done. Especially for you, checking all the boxes. Yeah. I'm a little obsessive about it. I check my every dollar every day, multiple times a day. I knew when I hit that send button on paying a debt, I wanted it to hit my bank so I could pull it over into the right category. And that was hard for me is the patience part of it.

1:54:00But I think that was a lesson that God was giving me. Tom, for you, the hardest part? Just getting involved. Just actually understanding that I needed to get rid of the debt. So once I retire, once we retire, we can do the things that we plan to do with our children. And now the grandchild, our little grandchild, he's amazing. You want to spend time with him and be able to do the things that you want to do. Yeah. And that was what I was going to ask. How old are you guys? I'm 55. Okay. 54. 55, 54. And so now on the other side of this, where are your heads and hearts about the future, knowing that you've made it through this and reset your financial future?

1:54:42Well, Tom's looking forward to retirement, obviously. I can retire in March next year. The state of Ohio says he can retire in March. He can't retire in March. Yes. Amy said no. Amy's made that perfectly clear. No, I plan to be with Samaritan's Purse for as long as God willing. So it'll be a few years for me. but we are looking at, we did our three-month emergency fund because we want to pay off our house and then we'll backfill that other three months. But we're not slowing down to not taking our foot off the gas. You guys are an inspiration to a lot of people. It's possible. So here we go. Thomas and Amy from Columbus, Ohio area, actually Washington Courthouse to be specific.

1:55:29They paid off$138 ,661 in five years, making$101 ,000 to$143 ,000. Congratulations. You guys take it away. Let's hear your debt-free scream. Ready? Three, two, one. We're debt-free! Oh, there it is. There it was. I think we got the real Thomas finally. Thomas had it all very kept, buttoned up. That was the corrections officer voice. Yeah, it was like, this is what happens if you do something stupid around Thomas. Yeah. Don't give him a nightstick. Oh. No siree. Uh-uh. Hey, that is so awesome, folks. He can be done. They did it. We're cheering all of you on as well. Keep it up.

1:56:50Our scripture of the day comes from Isaiah 5811. The Lord will guide you always. He will satisfy your needs in a sun-scorched land and will strengthen your frame. You will be well, excuse me, you will be like a well-watered garden, like a spring whose waters never fail. And our quote of the day from L. David Marquette, leadership is a choice, not a position. I got to tell you, I got a little distracted. Can I confess something? I got distracted too. Was it the scripture? It was. Were you talking about moisture? No, it was about the, and will strengthen your frame. And you know where this comes from?

1:57:26My wife and daughter, Josie, you know them well. Yes, I do. They love Dancing with the Stars. Okay. And I have to deal with that. Yeah, you do. I don't watch it, but I frequent the kitchen, live in your mirror. You've been in our home. And they're always talking about the judge, the one judge who I don't want to insult anybody, but I can't stand one of the judges. and he's always carrying on about their frame. And so here I am trying to do my job and read the scripture and it says, and I will strengthen your frame. And I want to confess to everybody, I got this judge from Dancing with the Stars carrying on about your frame.

1:58:04That's funny. I was opposite. I'm reading the part, toss it over here, where he says, you'll be a well-watered garden, a spring whose waters... And I'm thinking about the conversation we had about how you're laughing at me because I always make Sam put lotion on him to be moisturized. I wasn't going to bring this up. This is a whole separate subject. Kelly and James, we had dinner with Jade and Sam recently. And it was a 45-minute section of our dinner where Jade and Sam walk through their pre-bedtime lotion routine. And poor Sam has no choice in all of this. I just want him to be a well-watered garden.

1:58:45he is and she straight up said i'm gonna look great when i'm old he has to as well and the routine that sam has to go through is nothing short of punishment he has a skincare routine his that you gave him and forced upon him and you want to know what when he's 80 and goes like this the skin is not going to flake off ken he's not going to make it that far will you be able to say that no no and i don't want to the the amount of life he is not living that he spends on lotion I don't know if it's worth a trade-off. But he looks good. Come on, he's sexy. Okay, that's what I thought. He's a handsome man.

1:59:21Sharon in Buffalo. Sharon, how can we help? Good afternoon, Jane and Ken. Thank you for taking my call. Sure. So my husband and I have been married 12 years. Early on in the marriage, we were debt-free. But then he took on credit card debt. So our finances were separate. They've been separate for quite some time. Oh, no. Three days ago, I found out that he had been keeping a secret for three years. Uh-oh. That he co-signed on an auto loan with a co-worker that I have never met to this day. Oh, my goodness. And that co-worker, who doesn't even work with him anymore, is struggling with addiction.

2:00:08Oh, no. So they are not making their payments. And he finally told me, my husband there, a tail between his legs. But, you know, it's very, well, had you talked to me, I would have told you not to do it. Sure. And here we are. So right now, I've never seen this vehicle. My understanding is that it's probably trashed and it probably smells like cigarette smoke. So I have no interest in taking it over. How long ago was it? That the loan was taken? Yeah. Three years ago. Oh, gosh. Do we have any idea on the numbers? In other words, what's owed on it versus what it's worth? Well, one day my husband tells me$20 ,000.

2:00:55The next day he says$21 ,000. Really and truly, how much is this? I don't know. They think that if it were to go to auction, I have no experiences with repo. I don't know how any of that works, that they think they would get$5 ,000 for it at auction. So it's in bad shape. Now, did you say that you've already separated finances? Yeah. Okay. But we both own a home, and we would love to try to recombine. he has made an effort because the issues that made us split our finances in the first place that almost split us it was like okay let's split our finances and I continue to try to live my life that free but every time I try to get ahead I feel like I'm I love him dearly but he's a bit too much of a nice guy making the wrong decisions who's who's facilitating the conversation with you guys that's helping you see okay here's here's what caused the split here's what must be true for you guys to come back together here like who is there a counselor helping you with this there needs to be i think so too yeah i think so too because what i'm hearing um on your end is a woman who's almost done that's what i'm hearing i've been there before but i i know that i love him very very much uh but he's he he it's just like again and again and again and again right yeah and there's that part of me that feels stupid because it's like okay as much as this hurts he's probably gonna do it again yeah you need you need somebody to get in between that because this has been a wild ride for you.

2:02:49And I mean, I'm not a marriage counselor. I can't help you with that. I can look at these numbers, but I don't think it's going to solve the problem here today. He is, I'm assuming, fully aware of how this makes you feel and what this does to your relationship, correct? Yeah, yeah. So do you think he's in a situation, and again, I want to be very careful the word I use here, But is this a character issue only or is this he's got some type of trauma? He's got some type of addiction or something in his world to where he needs some extra help. It's not just him deciding to act like an adult. I'm just curious your take.

2:03:32I think it's a bit character. I think it's relevant to something tragic that happened on the job with this worker that many years ago. Yeah. Um, even still though, it, regardless of that, it, it is a pattern. Um, sometimes I describe it like if we were, you know, to go to a store and he held the door open for somebody, I might be the third person he let in, but then he's also going to stand there and continue to hold the door open for 80 people. And I'm going to be standing there like, okay, honey, can we go? So is it an overage of like, he's just trying to help everybody too much? Is that what he's spending this money on?

2:04:10Yeah. A crazy generosity. So he's a unhealthy pleaser. Yeah. Got it. Got it. Okay. That's insightful. But not for you, weirdly enough. Interesting. Yeah. And you know what? I hate to say it this way, but there is a silver lining there. He just needs to figure out the person he actually needs to please a little bit more is you. Oh, thank you. Yeah. And not in an unhealthy way because he's not healthy. but prioritizing you and what you think and what you want. Is he willing to do therapy? Yeah. So, well, especially the financial piece of it, because I'm not going to lie. I did propose this to AI and said, what do I do?

2:04:53You don't talk to freaking artificial intelligence. AI can't be your therapist. So are you in a church? Are you in some type of community where you can talk to people and go, I need three or four really great, legitimate recommendations on a therapist? um i maybe no you're not so you need to you need to figure out who you know that has some credibility uh that you trust their judgment that they've been to a therapist we're gonna have to dig a little bit and uncover let's just let's go to the website the web and find a local therapist but i think he's got to commit to this you have to say to him never again if you want to be in this marriage.

2:05:34We have to get this solved. We have to heal together. We both got our junk. Some of us did it to the other or whatever. There's no scorekeeping here. We got to get healthy. And if we can get healthy, there's a great chance that the money stuff on his end gets healthy. Yeah. So regarding the situation, I mean, the best thing that you're going to be able to do here is he needs to get his hands on the records to find out what is owed on this vehicle. and you guys need to start stacking up some cash so that when the time comes, whether it goes to auction or not, there is going to be a deficit for you to pay and you're going to be on the hook for it.

2:06:08And that's unfortunate, but it's the way it is. Thank you for the call, but you've got to fight for this. This is a fight for your marriage. Then the finances. Remember, there's ultimately only one way to financial peace and that's to walk daily with the Prince of Peace, Christ Jesus.

2:06:29Thank you.