Don’t Let Panic Derail Your Plan

7:08Dave Ramsey:Yeah. So there's two parts to the equation. We're going to send you that book and you guys are going to take the assessment. And I want you to develop a long term game plan for both of you. What are you going to be doing when this kid is 10 that makes a lot of money for your family and that you enjoy and that you're passionate about? and it's all three are congruent. Okay. The second part of the equation though is what are you going to be doing in the next nine months? You guys need to take six different jobs. All of you, you need to work like crazy people and pile up as much cash as you can pile up right now.

7:39Dave Ramsey:Get ready because you're getting ready to have a hiccup in your income nine months from now, right?

7:45Ken Coleman:Right.

7:46Dave Ramsey:And so you got to get ready. And the way you get ready is you build a storm cellar and you fill it with money and you go work, work, work, work, work, work, work, work, work, work, work, work, work, work, work, like crazy for a short period of time.

7:55Ken Coleman:If you have family in the area that can help watch the baby, you could spin off this woodworking that you do and work full time or close to full time. If you schedule, you know, your work around weekends, odd hours, because it's really project based. That's how you can make sure we don't miss any money once baby arrives. You got to start thinking like that.

8:17Dave Ramsey:Sounds like she's doing it for someone else by the hour. I agree.

8:20Ken Coleman:But my point is, can she now do that for herself? Herself. That's right.

8:22Dave Ramsey:and then set her own hours because these are project-based. So it got real. That's the summation of the call. It got real. And the short term, you've got to pile up some cash and get ready. Long term, it's now time to do big boy, big girl jobs, careers, not just I take a job that pays me some money so I can make it to the weekend.

9:01Dave Ramsey:I've been doing this show for over 30 years, and some of the saddest calls I've taken are from situations that are completely preventable.

9:12Ken Coleman:Yeah, and what's so hard is I feel like one of those, especially the ones that I'm like, oh, it's terrible. People that call in and their spouse has passed away suddenly, and they don't have life insurance. We actually took a question of a lady and she had three kids pregnant and husband didn't have life insurance. And I'm like, I can't even imagine. Or even if it was opposite, right? If a mom passed away, there's a dad with kids and trying to figure out how am I gonna afford childcare? How do I outsource some stuff that maybe she was doing? And it just takes the grief and the sadness of something like a sudden death to a whole new level.

9:47Ken Coleman:Like when you have to think through how am I gonna pay my bills? I'm going to eat next week.

9:52Dave Ramsey:Yeah, in the middle of all that grief.

9:53Ken Coleman:Like, it's just, it is, it's terrible. So life insurance is the one thing, especially as a mom with three little kids that I'm like, so big on for people to get because it's inexpensive. Xander is the place that Winston and I actually get all of our life insurance. And we keep re-upping it because I'm like, I just want it there. Like, there's something about that safety of knowing that you have money if something suddenly happens.

10:13Dave Ramsey:And it doesn't cost much because Xander shops among a gazillion different companies. It doesn't cost much. You just have to admit that someday you're not going to be here. You've got to say it out loud, and you've got to say, I'm going to say I love you to my family by taking care of them and taking the time to put this stuff in place. It costs us stinking pizza.

10:28Ken Coleman:It really is. So that is one thing to do to say I love you to your family.

10:32Dave Ramsey:So we've used Xander for all of our family's needs for insurance for many years, including, of course, term life insurance. To get a free quote, go to 800-356-4282. That's 800-356-4282, or go to Xander.com.

11:00Dave Ramsey:Brandi is with us in Georgia. Hi, Brandi. How are you?

11:05Ken Coleman:I'm good, Mr. Ramsey. How are you doing today?

11:07Dave Ramsey:Better than I deserve. What's up?

11:10Ken Coleman:Well, I've been married for 25 years and I don't work at the time. I'm taking care of my grandson, which my husband totally is on board with that. But I get no money unless I have to ask for it. And we are debt-free. We owe nothing. And I just feel like anything I say, he doesn't want to take my advice or anything. Like, I feel like we need to sell our house now because it's a bigger house, and we don't really need all the room. And we can sell this, and we have a really good life, I mean, I feel like. I don't know, I just fuck his daughter instead of his wife Oof

11:49Dave Ramsey:How can we help?

11:51Ken Coleman:Well, I just I don't know, I mean, what should I We ended up separating like two years ago and I found out actually what he was worth, what we was worth Like, I don't know anything If he was to pass away tomorrow, I wouldn't know what to do I don't know what's in his bank account I have no access to anything My name's not on his business My name's not on his debit card I can't use his debit card. And we've been married for 25 years. I'm like, you know, and it really aggravated me when we separated because my attorney, you know, gave me all this information on, you know, what he's got. And I was just like, I feel like I deserve that, you know, more.

12:28Ken Coleman:Where's the marriage now? We're together. I take care of my grandson. I can work. Like if I, you know, and I've even said, do you want me to work? He's like, no, I want you to take care of our grandson. You know, I think it's wonderful that we can do that. But it's like I don't get paid for taking care of my grandson, so I'm going to have to always ask him for money. Does he give you money when you ask? What's that transaction like? He does. Yeah, he does, but he only gives me money for what I need. Like if I'm going to get groceries, he'll give me like$200. I'm like,$200, I don't buy anything.

13:01Ken Coleman:You know, and my fear is I'm going to get up to the counter and not have enough money and have to put everything back. And I know he's got the money to give me. That's what's helped. So, you know, it makes me so aggravated at them. Well, what happened over a two-year, or you separated two years ago, what happened as a result of separating? Because it doesn't sound like anything has changed. It hadn't. And honestly, I feel like we got back together.

13:25Dave Ramsey:Why are you not still separated if nothing changed?

13:27Ken Coleman:Well, financially, it was so expensive, having to pay attorney fees, which he had to pay me$750 a week alimony during that time. but I had to get a place to live, so I didn't realize how expensive things was because we had no debt, so I went from not having no debt to having probably$3 ,500 a month that I had to pay for my rent. So you went back to jail because it was too expensive to be free. That's what I'm hearing. Yeah, I just love them so much. It's crazy. Do you?

14:00Dave Ramsey:So why did you call us? I'm so confused. What do you want us to do?

14:04Ken Coleman:Well, I just feel like, am I in the wrong for wanting, you know,

14:08Dave Ramsey:No, you're not in the wrong, but you're not doing anything about it.

14:11Ken Coleman:I know. That's why I called you to get to my husband.

14:13Dave Ramsey:Well, I can't do anything about it. You've got to do something about it.

14:15Ken Coleman:What can I do?

14:16Dave Ramsey:What should I do? Well, I think you've got to decide if you want to be married to someone that treats you this way. And you're going to have to sit down. My recommendation would be that the two of you sit down with a good marriage counselor and that Bubba hears for the first time in his 25 freaking years that he's mistreating his wife.

14:34Ken Coleman:And he feels like he says I don't manage. I don't care what he says.

14:38Dave Ramsey:You actually care what he says, but I don't. I know. So you need to not care what he says. You need to go see a marriage counselor because he sucks as a husband. He's a horrible husband.

14:52Ken Coleman:I agree because I had to go to the doctor yesterday.

14:54Dave Ramsey:Darling, you're just going to talk my arm off and do nothing. I can tell. I can tell exactly what's going to happen with you. Yeah, he's manipulating me. You've got to decide what you're going to do. Okay? And quit telling me stories about him. Are you going to actually get on the phone and call a marriage counselor and go sit down with one? You need to do that today. And if you don't do that, quit telling people stories about him. Shut up. Live with it. Okay? If you're not going to do nothing about it, shut up about it. But if you're going to do something, then we'll pray for you and back you.

15:26Dave Ramsey:And yes, you're correct, honey, that the situation's weird, and he's not a good husband. He's mistreating his wife. And the problem is he's probably not a bad guy. He's probably just doesn't even know how to do it. He probably doesn't know how to be a good husband. He thinks he's taking care of you. He may be that dumb. And so, you know, we're going to have to educate him and teach him that, you know, this is emotional financial abuse, dude. And so you need to involve your wife in the decisions. Let her have the dignity of being one of the two adults in the household. But that's a marriage counseling thing, honey.

16:04Dave Ramsey:I can't dictate that. I don't have a magic wand over here to tap him on his little head and say, that's it, dude. Now you're magically healed. I can't do that from here. But you're going to have to work on it. And I don't think you're going to. You just talk about it all the time.

16:17Ken Coleman:Yeah, you've married a control freak. And then you've let him get more and more control over 25 years. And then you've summoned up some guts, which I admire, two years ago. But then it ended up being a pump fake. You just pump faked or he called your bluff. he played to your greatest fears as my guest not knowing the details and you caved and you've convinced yourself that i love him so much and i don't think that's the case that's enabling that's

16:40Dave Ramsey:just bullcrap so i love him so much i'm willing to be abused yeah come on he's warped i don't think

16:45Ken Coleman:he's dumb i think he's warped because he's really unhealthy and i'm not attacking him and i'm not making excuses for him but you've got to shake him he needs to be shaken yeah if this guy was my

16:57Dave Ramsey:buddy i'd be boxing his ears man i'd be giving him a hard time that'd be fun that'd be an interesting conversation wouldn't it of course he wouldn't have been my buddy because he wouldn't because that's true that wouldn't have worked out that wouldn't have worked out either john is in nashville hey john how you doing you're doing all right yourself mr ramsey better than i deserve how can we help um well i'm having some issues i'm 20 years old um i have a one-year-old

17:25Ken Coleman:kid and a wife um and i'm in so like deep debt to the point where i think i'm gonna have to go bankrupt um what kind of debt have you got honey um i have 32 000 student debts for my wife she's currently in school um and then i have so you're running up you have 32 000 in student debt and you're continuing to run up student loan debt uh no so that's who's paying for her school I am. She's a stay-at-home mom. With what? We have a one-year-old. With me working.

18:01Dave Ramsey:Oh, okay. And what other debt do you have? Sure.

18:06Ken Coleman:And then I have two vehicle loans. And on my truck, I'm two months behind.

18:13Dave Ramsey:How much do you owe on your truck?

18:16Ken Coleman:I owe$11 ,700. Okay. And what do you What do you owe on the other car?

18:20Dave Ramsey:What do you owe on the other car?

18:22Ken Coleman:$10 ,000.

18:23Dave Ramsey:Okay, and what other debts do you have? Credit cards?

18:27Ken Coleman:I have$3 ,000 in personal loans and then about$1 ,000 in credit cards.

18:32Dave Ramsey:Okay, all right. And what do you make, sir?

18:36Ken Coleman:I make$3 ,500 a month.

18:39Dave Ramsey:Okay, all right. Okay. You're not bankrupt. You're 20 years old, you have a baby, and you're scared. And you've done some dumb things that have put you in a corner, but it's not bankrupted you, okay? You have cars that you can't afford, okay? You can't afford these cars, obviously. That's why you're behind on the truck. You do not have any organization to your money, no budget or anything else. And student loans are not bankruptable. And you can't bankrupt on the cars unless you pay the bill. And if you don't pay the bill, you give up the car in bankruptcy. So if you have no cars and you still got the student loans, you could be bankrupt.

19:22Dave Ramsey:But it really wouldn't do you much good. You could just sell the cars and still have the student loan and not be bankrupt.

19:29Ken Coleman:Gotcha.

19:30Dave Ramsey:What's the truck worth?

19:34Ken Coleman:Whenever they pulled it, I had the loan out for$12 ,750.

19:38Dave Ramsey:What's the truck worth?

19:41Ken Coleman:It's probably worth$9 ,000. Okay, good.

19:44Dave Ramsey:And who do you owe the money to? uh the bank local bank okay and what about the ten thousand dollar car what's it worth

19:55Ken Coleman:um it's we paid 16 for it um i gave you know 6 000 down good you need to sell that car this week

20:05Dave Ramsey:okay and your wife can't be in school you can't afford to pay for school right now when your truck payments are behind your wife's not going to school you don't do that okay you got to get organized here we're going to help you man i've been where you are and been scared with a little baby and didn't know what to do we're going to put a ramsey coach in your corner at my expense we're going to pay for it and we'll put you into financial peace university and you and your wife are going to do that you're going to have to sell everything and you're going to work like a maniac and you can turn this around and we can show you how you're You'll be okay, son.

20:53Dave Ramsey:Let's face it. Health insurance today is more complicated than ever. The system isn't built to help the average person understand. and it leaves too many families unprotected. That's why you need my friends at Health Trust Financial. They aren't just brokers. They're trusted health insurance advisors who have been helping families like yours for over 20 years. You don't have to navigate it alone. The experts at Health Trust Financial listen to your needs, work to understand your family situation and budget, then help you choose the health insurance plan that's right for you. That's why they're Ramsey Trusted and why we've worked with them for two decades.

21:38Dave Ramsey:Look, medical debt is the number one cause of bankruptcy in America today. One hospital visit can wipe out your savings and undo all your hard work. So health insurance isn't optional. It's part of your financial defense plan. Health Trust Financial knows their stuff, and they're the only health insurance provider I recommend. So get clear about health insurance plans and get the coverage that's right for you at HealthTrustFinancial.com.

22:34Dave Ramsey:buying or selling a home is a big deal and you want an expert in your corner not somebody who got their license three weeks ago and happens to be your aunt sally bad idea you need like a real real estate agent like somebody that knows what the flip they're doing hello the ramsey trusted program is the only way to find a high-octane, high-protein top agent that you can trust, that we trust, to make your home a blessing and not a burden. It's easy. You compare the agent profiles. You can interview them. You can choose the right one to work with among the Ramsey Trusted Bunch. To find a local Ramsey Trusted Real Estate Pro for free, go to RamseySolutions.com slash agent or click the link in the show notes.

23:17Dave Ramsey:Blake's with us in Asheville, North Carolina. Hi, Blake. How are you?

23:21Ken Coleman:I'm good, Mr. Ramsey. How are you?

23:23Dave Ramsey:Better than I deserve. What's up?

23:26Ken Coleman:So I'm starting a new job next week. I'm leaving my current job tomorrow. Wow, cool. Big deal. Big raise? Yeah, big deal. On paper, it's more money, which I'm excited about.

23:41Dave Ramsey:Why is it on paper and not real?

23:44Ken Coleman:Because it's not in my bank account yet.

23:47Dave Ramsey:Oh, because it hadn't happened yet. Okay.

23:49Ken Coleman:Yeah, I thought that was a congressman on Meet the Press for a second with that answer. On paper.

23:54Dave Ramsey:On paper. The promise is that we're going to get a raise. Okay, I got you.

23:58Ken Coleman:All right.

23:58Dave Ramsey:Yeah.

24:01Ken Coleman:About$1 ,900 more a month, guaranteed.

24:05Dave Ramsey:Okay, cool.

24:07Ken Coleman:Starting out$25 an hour. It's four days a week, 12-hour shifts, long shifts, but I get the whole weekend off, which is a blessing from what I'm currently doing. Okay. So I'm just kind of looking. I want to start investing money. I've not had any wiggle room in my financial situation to start investing. So I'm just kind of looking where and what I need to do to start investing. And by the time I'm 60, it's very comfortable.

24:34Dave Ramsey:Yeah, you'd have some money. Good for you. So do you have a 401k at the new place?

24:40Ken Coleman:I'll have to set one up after 90 days.

24:43Dave Ramsey:Okay. Do the Roth 401k.

24:48Ken Coleman:Roth, okay.

24:49Dave Ramsey:That means it's going to grow tax-free, but you're going to pay taxes on the money that you put into it now, which is whoop-dee-dupe-dee, no big deal. And they're going to match it probably, and if they do, they match it with non-Roth, which is okay. And pick good growth stock mutual funds. You can go back and listen to this later if you want to, but there's four types of mutual funds we invest in. I invest in, Ken invests in. It's what we teach. Growth, growth and income, aggressive growth, and international. Those are the four categories you're looking for. And you're looking for long track records, five years or more on those, preferably 10 years or more, but long track records.

25:34Dave Ramsey:And so if you've got two growth funds, you can look at them and go, okay, this one has a 10-year track record, and it is average 12%. and this one has an eight-year track record, and it is averaged 11%. Oh, I'm going with the other one. Okay, you know what I'm saying. That's how you're looking at it. It's not real hard. And they can show you every bit of that in the HR stuff with your 401K when the 90 days comes up. And we recommend you put 15 % of your income, not more, not less, into your 401K. Now, that is if you are debt-free and have your emergency fund in place of three to six months of expenses.

26:09Dave Ramsey:Is that true?

26:11Ken Coleman:That is not.

26:13Dave Ramsey:Okay, then we don't need to start investing yet. First investment is to get the debt paid off so that you've got the money to invest. Okay. How much debt have you got?

26:24Ken Coleman:I have$36 ,000 in student loans.

26:26Dave Ramsey:Okay, I'm going to attack that like my hair is on fire.

26:30Ken Coleman:Yeah, that's what I was thinking. I'm going to be in a good position next month, especially to start attacking that.

26:38Dave Ramsey:Yeah, I mean, you've got an extra$1 ,900, plus you can squeeze your budget down. So$3 ,000 times 12 is$36 ,000. You're done in one year.

26:48Ken Coleman:Thanks.

26:49Dave Ramsey:You got a$2 ,000 raise, and I'm pulling another$1 ,000 out of your party budget, and you're going to get out of debt in a year.

26:54Ken Coleman:And those weekends. So you got some time there.

26:56Dave Ramsey:Yeah, go make some money on the weekends. Let's do it even faster.

26:58Ken Coleman:Yeah, I do have a weekend kind of gig.

27:02Dave Ramsey:Cool. What do you make?

27:05Ken Coleman:It's just depending on what it is. I work in event production, so I got my degree. I agree in theater, focusing in lighting design. So I do like concerts and weddings, corporate events.

27:18Dave Ramsey:Okay.

27:18Ken Coleman:And just depending on the position, it depends on the hourly rate.

27:21Dave Ramsey:Yeah, I'd be working all the time for a short period of time. If they don't have one of those gigs going, I'd be doing something else. Okay? Lots of stuff going on in your area there in Nashville. Lots of things you can lay your hand to as a temporary thing. Because the faster you get out of debt, the faster you get to invest, the faster you're wealthy. Hello. Yeah. So that's the way we're looking at this thing. That's how we're going to go at it. Really good question, sir. Congratulations on moving on up. I like it. I like it. I like it.

27:48Ken Coleman:By the way, I just got to say this real quick because we continue to see this stuff on social media and in traditional media about – a poll came out from Gallup, just came out yesterday. The American people losing faith in capitalism. Is the American dream alive and well? And all this crap that gets put out there. And I just want to point out, here's a young man who is on the precipice of realizing the American dream. And he's calling in with a question like this. So I just want to contrast all the stuff you hear versus here's a real young man who's got it figured out and he's going to get debt free and he's going to be a multimillionaire because he's doing this early on.

28:25Ken Coleman:So this is a separate narrative than what you hear on TikTok and Facebook and all the things. This is a real deal here. So I applaud you, Blake, because you are – the numbers change when people do.

28:38Dave Ramsey:Guys, when you've been reading these things, you're being lied to. Yeah, that's right. The communist professors have put out the poll that capitalism is dead. And the communist professors are on payroll at the college that was financed with your freaking student loans. You need to keep in mind where this crap is coming from. Yeah. Okay? So capitalism is not dead. As a matter of fact, it is the best way in human history at this particular moment in time. You have, if you are right now in your 20s, you have the most opportunity to build wealth, the fastest of any time in any period, in any location, since man began walking the earth beside Eve.

29:26Dave Ramsey:Old Adam, remember him? Yeah. since then all the way to now this is the best moment in time where i in my 20s right now broke i could be a millionaire so freaking fast it would blind you there is so much opportunity but if you sit around and suck your communist thumb and swine about capitalism and wages and house prices while living in your mother's basement, typing on your$2 ,000 iPhone instead of working your little butt off, then you deserve what you get because you're signing up for victim mentality. We don't do victim around here. We do victor. Blake is a victor. That's exactly right. He's going to get it.

30:17Dave Ramsey:Poster child. That guy right there, man, he's a stud. Let me tell you, if he's single and you've got a daughter over in Asheville, Oh, you need to try to tell her to find him because that one's a keeper right there. That guy's going places, right? You don't want your daughter marrying a dreamer. They'll be in your basement. Or, you know, I'm going to be, I'm going to, what do you do? I'm an activist. I pick it against capitalism. Yeah, with that, God help me. Jeez, get away from my kid.

30:44Ken Coleman:Because you know the captains of industry are looking on the streets of Chicago and New York and L.A. for all those placards. Those poster boards are making a difference. It's just ridiculous.

30:54Dave Ramsey:You think I make a single decision at Ramsey based on those morons? Absolutely zero, okay? Just zero. So nobody does. People that are doing things don't have time to watch that garbage. That's right. So, yeah, I get aggravated. But sure, that's a good point, Ken, that truthfully, the digital age, you can just decide. And I'm in business. and a minute and a half later you have a website and shopify will set the stinking thing up and you start selling your little idea and then when it fails you can start another one next week i mean it's just the most wonderful time to be alive and make money and help people yeah it's

31:38Ken Coleman:an amazing moment in time blake just got a promotion and he has got a side hustle on the

31:43Dave Ramsey:weekend if he can do it you can do it but he's been destroyed by 36 000 worth of student loan debt. He's hopeless. He'll never make it. The system is rigged against poor Blake.

32:13Dave Ramsey:We've told you for years, debt is dumb, cash is king, and the borrower is slave to the lender. So when we find a bank that actually gets that, we shout it from the rooftops. That's why we've partnered with Fairwinds Credit Union. These guys aren't pushing credit cards or auto loans like your current bank is. Fairwinds is on your side. And now they've taken it to the next level. They worked with us to create a high-yield savings account that gives you a great rate without the junk. No bait and switch rates, no credit score games, just a simple, powerful way to help you build your emergency fund fast.

32:53Dave Ramsey:It's part of what Fairwinds calls the smart bundle. Made for Ramsey fans. You get high-yield savings, a no-fee checking account, and zero gimmicks. Just common-sense banking that works with the baby steps, not against them. And coming soon, they're launching a brand-new Ramsey debit card. It says debt is normal, be weird, right on the front of it. That's not just a card. That's a daily reminder that you do money differently. So check them out at fairwinds.org slash Ramsey. Fairwinds is federally insured by the NCUA.

33:50Dave Ramsey:James is in Oklahoma. Hi, James. How are you? Good. How are you? Better than I deserve. What's up?

33:58Ken Coleman:Hey, we recently came into an inheritance, and we were wondering what to do with the money. We have a small farm, and we still owe on it, and that's it. But we didn't know if we should invest or pay it off.

34:15Dave Ramsey:Okay. And how much of an inheritance did you receive, sir?

34:20Ken Coleman:$700 ,000, and there's roughly$330 ,000 left. That's coming in additionally.

34:28Dave Ramsey:So you're going to get a million total. And how much is owed on the farm?

34:35Ken Coleman:The total land is$336 ,000, but the house is separate and my student loans.

34:41Dave Ramsey:How much are your student loans? My debt,$46 ,000. Okay, so$400 ,000 clears everything out of a million? Roughly$600 ,000 will clear everything. I'm sorry, I got lost. You said you had$340 ,000 on the land and$40 ,000 in student loans. Is there a house loan, too? Yes, there's a house loan, too. Oh, separate. Okay. So you could be debt-free for$600 ,000 and still have$400 ,000 left over when the smoke clears?

35:09Ken Coleman:Yes.

35:10Dave Ramsey:Okay, cool. Why would you not do that?

35:15Ken Coleman:Well, we were talking, our financial advisor was wanting to invest the$600 ,000 now, and then so we just didn't know if we should invest. And he was saying not to pay off the house because of the percentage, and I just didn't really know what to do to get debt-free and then worry about investing. Yeah.

35:35Dave Ramsey:What's your household income?

35:38Ken Coleman:I'd love for$200 ,000. Okay.

35:41Dave Ramsey:So if you had zero payments, you'd have lots of money to invest, wouldn't you?

35:48Ken Coleman:Yes, sir.

35:49Dave Ramsey:Yeah. I think you need a new financial advisor.

35:54Dave Ramsey:Yes, sir. Yeah. This one sucks. So, yeah. Honestly, I mean. We have cows, too, that help make the farm payment as well. That's good. That's good. The cows make money in your pocket if you don't have a payment, right? That's true. Okay. Yes. All right. Yeah. This idea that wealth is built from borrowed money is mythology when we actually look at the hard data. We studied 10 ,167 actual millionaires. The number of them that said the way I became a millionaire was my financial advisor told me to invest with him instead of paying off my farm was precisely zero. 10 ,167 millionaires disagree with your financial advisor.

36:49Yes, sir.

36:49Dave Ramsey:That's what I'm saying. Okay? And so if you take the freed up cash flow that you will have and you quit borrowing money the rest of your life and you're going to have approaching a$2 million net worth when this all happens and a$200 ,000 income, you're going to be worth$20,$30,$40 million, dude. when this is over. I mean, if you'll just stay out of debt and keep steadily investing and steadily being generous and paying cash for things from this point forward. And let me ask you, who passed away that left you this money? My dad. He was a big what? Fan of yours. Oh, okay. So regardless if he was a fan of mine, he's probably a fan of mine because he probably did the stuff I'm talking about long before he even heard of me.

37:43Dave Ramsey:And then he just found me and I agreed with him. Does that sound right? Yeah. In other words, it's not me. It was him. And I think if he's in heaven and you pay off your farm, I see him smiling. What do you think? No, yes, sir. I completely agree. He'll also be smiling when you fire this financial advisor.

38:04Ken Coleman:yeah and by the way by the way that's that's the issue this financial advisor you've trusted up into this point and he gave you this advice and yet something in you said i think i should call

38:15Dave Ramsey:dave today that doesn't ring with what dad taught me so i trust trust the guy dad's money i'm getting i'm gonna honor him with this legacy and this guy yeah this doesn't feel right so you can't be afraid to disappoint. The tuning fork of your heart.

38:33Ken Coleman:Yeah. So disappoint the financial advisor. That's what's going on here.

38:36Dave Ramsey:I'm happy to disappoint this person.

38:38Ken Coleman:I know you are, but a lot of our callers, we got to get them to the point where we realize, hey, you already answered this question before you called us.

38:45Dave Ramsey:Here's the other thing. Unless I miss my guess, this guy that I'm talking to on the phone right now is net worth before the inheritance was greater than the financial

38:54Ken Coleman:advisors guaranteed the dirt the cows everything all of it this is just just saying caroline's in colorado hi caroline how are you hi i'm good thanks good how can we help um i'm just i'm feeling a little discouraged um a year ago my husband and i were on baby step four we had two full-time jobs three additional income streams um but in the last 12 months my husband lost his job we're down to income streams um we had to deplete our emergency savings use some retirement funds and go into debt. Why? Well, I guess I can explain that. You didn't have to, but you did.

39:32Dave Ramsey:Why?

39:34Ken Coleman:We were trying to get out of debt by selling one of our properties. You got into debt, you said. Yes, because it took us longer to sell the property, and we had to put more into it to sell it than we were expecting to.

39:48Dave Ramsey:But why did you not just go get the job and replace the income?

39:53Ken Coleman:uh i'm sorry which job the one he lost oh he did he found another job um but he had to take a pay cut

40:03Dave Ramsey:okay there's a lot of half twos in this story all right and um okay how can i best help darling

40:10Ken Coleman:well so we we are net worth millionaires but we're struggling to get by month to month and we recently sold one of our rental properties um like i said to get us out of debt and we're just at a crossroads and unsure of what the next best move is. Okay.

40:26Dave Ramsey:If you have a net worth, so is your household expenses too high?

40:33Ken Coleman:Yes. Okay.

40:35Dave Ramsey:So what are we doing to cut those?

40:38Ken Coleman:I mean, I've cut back on everything. What's it take for you to live a year?

40:45Ken Coleman:Rough. Well, including the mortgages that we have, it's around$15 ,000 a month. Okay.

40:53Dave Ramsey:So you're net worth millionaires, but you've leveraged yourself into real estate and gone broke. You need to be selling every piece of real estate you have except your personal residence. You're not cash flowing on this. Your million dollar net worth is not paying you enough to justify the expenses that you have. Okay.

41:14Ken Coleman:Okay, so, but part of—

41:16Dave Ramsey:You've got debt associated with all this net worth, so the net worth is invalid.

41:21Ken Coleman:Okay, but my husband's income isn't enough for us to live off of, and we need additional—

41:28Dave Ramsey:It is if you don't need$15 ,000 a month to live. Most people don't. That's ridiculous.

41:37Ken Coleman:Are you catching what we're saying? What's the biggest chunk of the 15? Give us the real numbers. uh i mean the two mortgages obviously so what are those two mortgages um one is 4600 and one is 3400

41:49Dave Ramsey:right so sell them right well and that's that's what i'm saying is we did sell a property and we have yeah but i'm not talking about the property you already sold i'm talking about the one that's killing you right now. You have houses you can't afford. Okay.

42:09Ken Coleman:It's, um, I mean, it's worth 1.8 million and we have about$250 ,000. That's wonderful, but it's killing you. And then do what with the money?

42:20Dave Ramsey:Buy a paid for house that has no mortgages. okay you know you've got debt that's so high that it is invalidate that is creating personal consumption debt on real estate you have two houses neither one of one of which are rentals neither one of which are investment properties you are consuming eight thousand dollars nine thousand dollars a month in mortgage payments am i understanding you correctly um yes sir we i mean

42:50Ken Coleman:And we have a third rent.

42:52Dave Ramsey:I know, but those properties right there are creating the$15 ,000 a month nut you want to crack, correct? Yeah. And so you bought houses you can't afford, honey. That's what we're saying. And so get your dadgum outgo where it fits within your income. And that's called selling these extra houses. You've been living higher on the hog than you can afford. Or than you can afford now, anyway.

43:37Ken Coleman:This show is brought to you by BetterHelp. All right, as a society, we tend to overshare sometimes. We tell everybody everything. And as fun as it can be to talk to random people about all the stuff going on in our lives, when you need real help with relationships or clinical issues like stress or anxiety or depression, random people probably don't have the right answers. You often need guidance from a licensed therapist who follows a strict code of conduct and who's been trained to sit with hurting people. And that's why I recommend my friends at BetterHelp. BetterHelp is the largest online therapy provider in the world.

44:14Ken Coleman:That means that no matter what you're facing, chances are they've got somebody who specializes in exactly what you're struggling with. BetterHelp is totally online, and that makes it easy to fit therapy into your wild schedule. To get started, just answer a few simple questions, nothing weird, and they're going to connect you with the licensed therapist who fits your needs. Plus, if it's not the right fit, you can switch anytime for no extra cost. BetterHelp has been matching people with their therapist for over 10 years. And their 4.9 rating shows that BetterHelp is really good at matching people together.

44:49Ken Coleman:Find the right one with BetterHelp. Visit BetterHelp.com slash Ramsey to get 10 % off your first month. That's BetterHelp, H-E-L-P dot com slash Ramsey.

45:12Dave Ramsey:Welcome back to the Ramsey Show. Show in the Fairwinds Credit Union studio. I'm Dave Ramsey, your host, Ken Coleman. Ramsey, personality, number one bestselling author, is my co-host today. Chris is in Wyoming. Hi, Chris, how are you? Good, yourself? Better than I deserve. What's up?

45:30Ken Coleman:I just wanted to give you guys a call. I mean, kind of going through some struggles with debt, and I got fired from my job on Wednesday. Whoa. Oh, that sucks. What happened? They gave me an evaluation, and I guess I didn't score high enough. And I think they fired me because of my hearing issues, because I was born partially deaf. And so I think that's part of the reason why they fired me, because I didn't understand things.

46:04Dave Ramsey:Yeah, you're going to have to speak directly into your phone, sir. You got muffled on me there. But you had trouble understanding things? What was the job?

46:10Ken Coleman:Yeah, I was working at a casino. I was doing surveillance. And they just, I'm kind of looking at cameras, I'm answering phones, and I think I just wasn't understanding a lot of stuff that I was being told. And they didn't tell me they fired me because of my hearing issues, but I kind of think that's what it was. Well, and the reason I'm asking this follow-up is because this is going to inform maybe some advice we give you going forward. when they went through the evaluation, whether or not they told you that or not, did you agree that you weren't meeting their evaluation points? Yeah, I do, I do, I do.

46:48Dave Ramsey:Listen, you're not speaking directly into your phone again, honey. You don't have to do that. It's muffled.

46:53Ken Coleman:Yeah, so, yeah, I do agree that I was having a hard time understanding things that they were, the tasks that they were giving me.

47:02Dave Ramsey:Okay, okay. and um so you your biggest crisis is you're unemployed yeah um i'm unemployed and um my

47:14Ken Coleman:wife can't work because uh she's she got a she tore her butt she tore her femur back when she was in the military and she's using two canes and she hasn't worked for so long and um so it's just it's been hard to try to take care of her myself and our three kids and um are you aware of are you aware of what kind of work that you can do where the hearing is not going to be that big of an issue um for like 15 20 15 to 20 plus years i was doing like physical work like warehouse type work because it really didn't involve a whole lot of i mean i started to hear things but it wasn't as bad as, you know, having to like, I didn't have to like answer phones or any type of thing like that.

47:59Ken Coleman:And, um, so I've been trying to get back into that again. It's just, and with winter hours coming up, it's just kind of been more harder to get into that again.

48:09Dave Ramsey:How did you lose your hearing?

48:11Ken Coleman:Um, I was born with, I was born with, um, it was genetic. Okay.

48:17Dave Ramsey:Do you have hearing aids?

48:19Ken Coleman:Um, yeah, I do. I went through the Wyoming workforce. But they're not working? They're working. They've been a big help. But even after I got the hearing aids with the casino, I was still having a hard time. So I try to do everything the best I can, and I seem to still have a hard time hearing. Well, the casino is a very noisy place, and even with hearing aids, that can be a problem. I'm worried about your location. It seems when you said winter hours that you have limited opportunities due to where you are. Is that what I'm understanding? Yeah. I mean, I'm in here in Cheyenne, and usually when winter starts coming up, that's when a lot of places cut back hours because they're fully staffed, and it's harder to get into places.

49:15Ken Coleman:Sure. How much money do you need to make? What's the bottom line that would just take care of you guys, just your basic expenses? What do you need? My rent. I mean, it's my rent, my electric. I don't have to worry about, like, gas or anything. Give me a number. Do you got a number, a monthly number that you need to live? In all honesty, I mean, I honestly don't know. um can't really figure out her number um it's usually about like i think like 3 000 a month that's usually where all my bills are at um because i got two vehicles and then you know my kids taking care of the expenses for them too and the food and all that stuff and um you have

50:08Dave Ramsey:two car payments?

50:09Ken Coleman:Yeah, I have two car payments. I have my truck payment, which is$740, and then my car payment's$360.

50:19Dave Ramsey:I don't know what in the world planet you're on that you think you can afford a$700 truck payment.

50:25Ken Coleman:When I was working with Walmart, I got fired from them the same year in January.

50:31Dave Ramsey:Why did you get fired from Walmart?

50:34Ken Coleman:Because of my attendance, because of the wife's medical issues with her leg and then my mental health. I was leaving a lot and I was calling off a lot because of my mental health. And I ended up after I got fired, I ended up in the mental health.

50:49Dave Ramsey:What's the nature of your mental health problem?

50:54Ken Coleman:Well, when my daughter was born, she...

50:57Dave Ramsey:No, your mental health problem. What's the nature of your mental health problem?

51:03Ken Coleman:I'm depressed.

51:04Dave Ramsey:Okay. All right.

51:06Ken Coleman:and it all really started.

51:08Dave Ramsey:Is your wife on military disability?

51:11Ken Coleman:No, she's been trying to fight with the VA for several years. Are you on any kind of disability? No, I'm not. I try to get on Social Security, and they denied me because I finally got the job at the casino,

51:30Dave Ramsey:and they denied me because I was making too much. That would be true. That would be obvious, yeah. Okay, so what we've got to do is we've got to figure out a career where you can make some basic income, and, son, you've got to sell your truck, a$780 truck. And this picture that you have painted for the last few minutes is insanity. It's nuts. So you've got to get rid of the$780 payment, and you guys could go down to one car for that matter. Your wife doesn't work. She's on two canes. I don't think she needs to be driving a lot. So you got in and then you're going to have to pick up work doing a lot of other stuff until you can land something that's stable.

52:12Dave Ramsey:Any good suggestions, Ken?

52:15Ken Coleman:Well, the reason I went that direction of what have you done or what kind of work is because you're going to have to get back into that space. And what I heard was a lot of limitations. But right now you can't accept limitations. I understand depression is real. That's a real thing. I get it. But you're going to have to fight through that because you are the person that this entire household is relying on. So, yeah, manufacturing, warehouse work. I'm showing up and I'm going to go back to Walmart and I'm going to say, hey, here's what happened to me. I'm going to power through it. I mean, anything and everything right now, two and three jobs.

52:52Ken Coleman:You have got to get enough money that may be seen. Not maybe. I'd see a therapist. I'd scrape enough money together where you get some help. because a professional can help you with some tools to power through the depression. And this is desperation time.

53:08Dave Ramsey:Yeah. I'm sorry you're facing all this. So sorry. I'm 100 % sure we've got to get your income up, and I'm 100 % sure you need to sell your truck. And when you do those two things, you create a sustainable situation mathematically, and that gives you the opportunity to work through the emotional struggles that you got. so keep it up dude keep pushing keep fighting you can do it

54:01Dave Ramsey:What does the future hold for business? Ask nine experts and you'll get 10 different answers. Economic growth or a recession? Business taxes will go up or down? AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 42 ,000 businesses have future-proofed themselves with NetSuite by Oracle. The number one AI cloud enterprise resource planning system. Ramsey Solutions uses NetSuite, and you should too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities.

54:42Dave Ramsey:With one unified business management suite, there's one source of truth for the visibility and control you need to make quick decisions. NetSuite's real-time insights and forecasting help you see into the future with actionable data. And when you're closing the books in days, not weeks, you spend less time looking backward and more time focusing on what's next. And speaking of what's next, download the CFO's Guide to AI and Machine Learning at netsuite.com slash ramsey. It's free at netsuite.com slash ramsey.

55:37Dave Ramsey:The Ramsey Show question of the day is brought to you by Why Refi? You may think no one can help with your defaulted private student loans, but Why Refi is different. They work with borrowers in tough spots without judgment. Check them out at yrefi.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. Not in all states.

55:59Ken Coleman:Today's question comes from Carlos in Texas, and he gives us some context from a Newsweek article that I'll read first. And then his question, the federal government will accept Venmo payments from citizens who want to help pay off the national debt. The Treasury has begun accepting Venmo transactions as contributions toward the national debt, which currently stands at$36 trillion. I made it through that, James, without laughing. But now Carlos's question based on this excerpt. What is your opinion on the new option of being able to voluntarily Venmo the U.S. government to help pay down the national debt?

56:42Ken Coleman:Well, my opinion comes from one of my favorite movies where Anthony Hopkins plays this old man who's had a stroke. And now I said it's one of my favorite movies. What is that movie where Brad Pitt's in it and he's the old and they're coming for his land? Somebody bail me out, James. What is that movie? Legends of the Fall. Legends of the Fall. And they come over and his son comes up to old Anthony Hopkins who suffered a stroke and he has a chalkboard around his neck. That's how he communicates with his family. And they say, Dad, they're offering us land. The government's offering us money for our land.

57:15Ken Coleman:And he says, his mouth is all crooked. He leans in. He says, screw them. Screw them. That's my answer. That's my answer. Are you kidding me? The government came up with this idea that we're going to Venmo my money when they already taxed me too much, Dave? My blood pressure is unhealthy.

57:35Dave Ramsey:It's not good for you. Take the ball away from me. This is bad for you, Ken. I can tell. Now, it's just not, you know, your mental health now, Ken.

57:43Ken Coleman:Dave, I need to take the rest of the show off. My mental health is too fragile right now. I've not heard this. Have you heard of this?

57:51Dave Ramsey:Yeah, yeah. I think it's wonderful because there's always some idiot out there who says that, you know, everyone should pay their fair share. And I would be willing to pay more. Someone always says that when they're talking about tax the rich, right? Oh, sure. And so I always wanted them. You know, we had that argument many years ago here in the state of Tennessee. We ran a governor out of office that tried to bring in a state income tax, and he was confused, and the people here didn't want that. So glorious. Anyway, anyway. So, yeah, but there were all these Libby's that were saying, you know, like, oh, well, I would pay more.

58:31Dave Ramsey:And we're like, well, you can. Just send them a check, you doofus. Right. And so if you want to pay more because you just think that this is the whole thing, such a great operation, then yeah, sign up for Venmo, baby. Have at it. But the rest of us who have something akin to common sense would be like, screw it. Right. That's the dumbest idea I've ever heard in my life. You've got to be kidding. Here's the thing. Forty-nine percent of Americans pay zero federal income tax. Thank you. Did you know that? 51 % of us carry the whole thing.

59:13Ken Coleman:That's not helping my blood pressure, Dave.

59:15Dave Ramsey:They pay zero federal income tax. So please don't talk to me about fair share ever again. Yeah. Okay? I'll help you with this. So everybody ought to be paying something. Yeah. I don't care if you make$5 and you pay a nickel. I don't care. You ought to be paying a little something. Everybody pays a little something. And so we can start arguing about flat tax now, and that would be fair. If I pay 10 % of my income and you pay 10 % of your income, and I make a lot more, so I pay a lot more. That's fair. The way it is now is not fair, but it's not equitable. But anyway, so yeah, if you want to pay some more into the government, I think if you're the type of person that believes this is a good idea, I think you should do it.

1:00:03Ken Coleman:You know what? that's actually true if you're that stupid then you shouldn't have any money anyway so go ahead and send it to the same organization that ran up the debt to 36 trillion and steaming towards 40 trillion it's the most it's just nonsensical so sure yeah you should yeah you

1:00:22Dave Ramsey:should do that you know they just did that to just just for you and me is that a fake question is that just to see if 100 real but i knew it would be gold with y 'all too i feel like i need

1:00:32Ken Coleman:a whole bottle of pepsi dac just chewing on him after that question yikes rochelle is in texas hi rochelle how are you hey it's uh not rochelle she chickened out i'm her husband okay so what's the uh what's the what's the chicken husband's name what's your name uh the chicken husband's name's charles hi charles how are you man i'm good and thank you for taking our call i've been listen to you guys for a long time.

1:00:59Dave Ramsey:Thank you. How can we help, sir?

1:01:02Ken Coleman:So I'm active duty military, and my wife and I, we're going to be getting transferred out to Hawaii for our next unit. We're kind of at an impasse right now. We're finished with baby step five, and we're considering buying a house. But as it sits right now, with the math that we've done, it seems like buying a house in Hawaii is going to tie up so much of our liquidity. It just seems like it'll do better invested in good growth stock mutual funds. We're hoping to get your opinion on that.

1:01:33Dave Ramsey:Thank you for your service. Yeah. We appreciate you. And the way we coach the military, and we coach a lot of folks in the military over the last 30 years, is there are some times, and when you make a move for two years, that you will buy a house, but most of the time you shouldn't. most of the time you should rent. And here's the math and the reason. Most markets, most real estate markets, on average, do not increase enough during the two-year period of time that you're there to be able to sell it and make money. You will lose money on the transaction. And most real estate markets move slowly.

1:02:17Dave Ramsey:Now, you're moving into Oahu, I assume. yep that's correct yeah and so uh you know the wahoo market has a lot of military saturation a ton of it and so there's always a good amount of military type housing for sale which means it's harder to sell it when you get ready to move now if you've got the money to play in a non-military neighborhood so to speak that maybe you could the thing if it goes up in value fast enough and you can sell it quick enough those are the two variables you can make money then it's okay to buy but probably in oahu you're probably going to be better off renting uh the transpose that with we were working doing some stuff with seal team and uh they're in the san diego market right san diego real estate generally is going up very quickly and generally sells very quickly and it's not saturated with military and so that's a market you can virginia beach is another one the market you could move into and out of and make money but if you're going to be stationed in the middle of a kansas cornfield and it's all military around you because the only thing in the entire area is military you're always going to have a bunch of military people that moved off and their houses are for sale or for rent and it screws up the market and makes it hard to sell and so you can end up with 273 days on the market nine months to get out of the stupid thing and you're going to lose your butt so i i think you're going to when you investigate Oahu, you're going to figure out that you're going to lose money if you buy for two years.

1:03:53Ken Coleman:I got it. And also, an additional worry that we have is our next unit will almost guaranteed be Kodiak, Alaska, and my pay is going to drop pretty significantly off that Oahu pay. So with the house not being paid off, which again, we calculated out, I don't think we'll be able to pay it off in time if it's an$800 ,000 house, for example.

1:04:15Dave Ramsey:Yep.

1:04:16Ken Coleman:uh when we when we go to kodiak we wouldn't be able to make that work the pay would just be

1:04:22Dave Ramsey:too exactly and again kodiak is going to be a lot of military in that market right right real strong military consideration and so um it's um yeah so thank you for your service and but what i'm going to be doing is piling up money and when you are stationed in an area that is a vibrant real estate market that is not saturated with the military, you can make money, then it's okay to buy. Otherwise, I would rent and pile up money for when I retire from the military, and then I'm going to go buy. When I hit my 20-year or whatever it is, you decide to walk on it. Again, thank you for your service.

1:05:18Thank you.

1:05:42Dave Ramsey:If you're tired of living paycheck to paycheck and you can't get ahead, join one of our free every dollar trainings. Jade Warshaw, Rachel Cruz, George Camel, our Ramsey personalities, are doing trainings every week this month. They're all hosted by one of the Ramsey personalities, and we're going to show you how to stick to a budget, find thousands of dollars of margin using every dollar so you can get out of debt. When you do a budget, you feel like you've got a raise. That's what it amounts to, and we're going to show you how that works exactly. And you can ask questions during the live Q &A.

1:06:12Dave Ramsey:Sign up for free at RamseySolutions.com slash webinar. Brittany is in Huntsville. Hi, Brittany. How are you?

1:06:18Ken Coleman:I'm good. How are you?

1:06:19Dave Ramsey:Better than I deserve. How can I help?

1:06:22Ken Coleman:My husband and I just started Financial Peace University and downloaded every dollar, and we are struggling with whether or not we should do the snowball out of order. So right now, other than mortgage, our only bets are about$22 ,000 on my vehicle that I drive, and about$31 ,000 on my student loans, which are broken up into seven different loan groups. So the loans would technically be the smaller debts that we should snowball first. But I am pregnant and due in six months. My current car won't safely fit two car seats for our toddler and new baby. So I feel like I should focus on the car first and was just wondering what you all think on that.

1:07:07Dave Ramsey:So you owe how much on the car? $32 ,000? and it won't hold car seats?

1:07:13Ken Coleman:$22 ,000. Oh,$22 ,000. It was a RAV. Yeah,$22 ,000. Okay. The$31 ,000 is alone. What's it worth? It's worth about$22 ,000 with trade-in value. Kelly Blue Book said we could get$24 ,000 or$25 ,000.

1:07:25Dave Ramsey:What's your household income?

1:07:28Ken Coleman:About$150 ,000. I'm currently a stay-at-home mom, so that's on my husband. Okay.

1:07:35Dave Ramsey:And what does your husband drive?

1:07:36Ken Coleman:he has a lease deal through his job he's an engineer for Toyota so he's what does he drive a Tundra truck okay what year is your RAV4 2021 I think okay so who told you that the RAV4 cannot accommodate two car seats safely? So I guess I told me that because our current car seat and our infant car seat for my toddler that we had, we just upgraded his. Neither of those will fit behind the driver's side without touching the seat, and there's supposed to be a one - to two-inch gap. Well, the manufacturer says that you can actually, on the 2019 and later models, you can put three car seats in there.

1:08:28Ken Coleman:So I'm not trying to counterpoint you, but you've created this narrative that's completely false.

1:08:35Dave Ramsey:Yeah. Anyway, I'm fine with selling the RAV. Why don't you just sell it and buy a$10 ,000 car? Okay. That's a van. Buy a$10 ,000 minivan. Okay. And that reduces your debt from$22 ,000 to$10 ,000.

1:08:52Ken Coleman:well we so the thing is is like we just started doing ramsey solutions financial planning so we have ten thousand dollars like we could oh great great go buy a ten thousand dollar car and sell

1:09:06Dave Ramsey:the rav and you got rid of twenty two thousand dollars worth of debt yay okay okay perfect a ten thousand dollar minivan though not a thirty thousand dollar yeah that's what i thought we were

1:09:17Ken Coleman:leaning towards no no no the so we were just looking at it because we were trying to figure out we thought we were upside down on the car it turns out we aren't which is good that's awesome

1:09:26Dave Ramsey:yeah just get out of it and then then you've all you got to do is fight through the student loans and you're driving a ten thousand dollar car and you make 150 and you got a baby this is awesome yeah okay yeah but just fight through the student loans then and uh but but you always use these things as a reason to go backwards the reason we were all ken and i were both dancing over here on the other side of the microphone is 90 % of the time that somebody calls with your question, Brittany, they want to move up in car. That's what I thought. Exactly what I thought.

1:09:52Ken Coleman:I just want a bigger vehicle. I don't know. I don't blame you. That little rav is a tiny little, it's a tiny little wishes.

1:09:59Dave Ramsey:It was a Jeep car. Yeah. And so, you know, it's, yeah. And I don't blame you. I mean, that's kind of weird. Thinking about babies in the back of it's weird in my mind. So I don't mind. Yeah. But, but move down in car and take your 10 grand and let's accelerate this whole process. Okay.

1:10:15Ken Coleman:Okay.

1:10:16Dave Ramsey:You get to accomplish both goals in a positive way. Okay. That's what I would do.

1:10:22Ken Coleman:Yeah. Very cool. And I'm glad you gave perspective because that's what I thought we were being set up for. I did too.

1:10:27Dave Ramsey:I did too.

1:10:27Ken Coleman:It's like, wait a second.

1:10:28Dave Ramsey:That's what most people do. And we have to be careful about – because everybody calls us, not most people.

1:10:34Ken Coleman:Hey, listen. Full confession. My mom held me in her arms. That's how old I am.

1:10:38Dave Ramsey:I know. Yeah. So I don't do well with the – Well, it's –

1:10:42Ken Coleman:The car seats are too big. What is happening?

1:10:45Dave Ramsey:But the RAV is a tiny little.

1:10:47Ken Coleman:I get it.

1:10:48Dave Ramsey:I get it. It's a tiny little. I get it. I was wrong. It's a Jeep that needs you to add water to. I mean, it's too small. A Chia car? It's a Chia car. Okay.

1:10:58Ken Coleman:I like that. I like that.

1:10:59Dave Ramsey:Grant is in Montana. Hey, Grant, what's up?

1:11:03Ken Coleman:Hey, how are you? Great, man. How can we help? Thank you for taking my call. Sure. So I'm looking for some help or some guidance on whether the balance, whether taking care of my father is a priority or building a life with my girlfriend slash soon to be wife. I started my life over at 25. I got sober, built a career for myself. And about two years ago, I had to move in with my father. He's disabled, not able to take care of his home and property. How old is he? 68.

1:11:43Dave Ramsey:And what is the nature of his disability?

1:11:45Ken Coleman:He's confined to a wheelchair. He has some spine issues that surgery helped. How long has he been that long? About five years now. And you've been with him for five years? No, I've been with him for two years. two years ago, the HOA sent him a letter. I had been mowing the lawn and taking the trash out and doing what I could, but I lived about a half hour away. And so we just made the decision.

1:12:19Dave Ramsey:Are you planning to live with him for the next 10 years?

1:12:24Ken Coleman:That was my plan. I was single at the time that I made this decision. And then, yeah. Girl came along.

1:12:33Dave Ramsey:So now you're not planning to live there for 10 years. So we have to have a plan for dad and a plan for your life. They don't have to. It doesn't have to be either or it should be both. But the plan for dad might not be that you live there. It might be that we figure out some other way that he gets cared for.

1:12:52Ken Coleman:Sure. So what we've done is in preparation for that plan or whatnot, He spent a lot of his retirement. He retired pretty early. He retired when I was about 15. I'm 34 now. So he spent a lot of his retirement. Sort of the big thing he has left is the house. But we took the house and put it in a trust, of which I'm the beneficiary now in preparation for him being moved on to Medicaid at some point.

1:13:27Dave Ramsey:You understand Medicaid is welfare? Yes. And you understand that welfare nursing home is a different level of care?

1:13:35Ken Coleman:Yes, I do.

1:13:36Dave Ramsey:Okay.

1:13:37Ken Coleman:Yeah, we're not excited about that.

1:13:38Dave Ramsey:So you're planning to put him in a Medicaid nursing home so you can keep the house?

1:13:42Ken Coleman:That was not my plan. That was what he wanted to do in case he had to go on Medicaid because they have like a five-year look-back period.

1:13:53Dave Ramsey:They sure do. They sure do. Yeah. Yeah. And the trust doesn't help at all. I can undo the trust on the five-year look back, so it's got to be five years. Has it been five years? Yeah.

1:14:04Ken Coleman:No, we just put the house into the trust last year.

1:14:07Dave Ramsey:So you've got four years that you're going to continue this if you're going to continue this. Probably not going to work. I think you're selling the house so that your dad can use his money to care for him so that you can – and he gets a sustainable situation. He can't live in this house without help, and he doesn't have the money for the help, and you're not the help anymore.

1:14:32Ken Coleman:Well, that's where I struggle. I don't.

1:14:37Dave Ramsey:I don't. No dad that is a good man wants his kid to have no life when he's sitting on a house that the money from the house will take care of him. You're supposed to go on and have a life, young man. And you can take care of your dad. You can set up a situation where your dad is cared for with the equity from this house, moving into a one-level house, a situation where he's got care with the money that's the equity because he's blown his retirement. And then you go on and have a life in the process. These things are not incongruent.

1:15:42Dave Ramsey:EJ's in Philadelphia. Hi, EJ. How are you?

1:15:45Ken Coleman:I'm great. How are you?

1:15:47Dave Ramsey:Better than I deserve. What's up?

1:15:50Ken Coleman:so um my fiance and i are getting married in about a month and um we're about to receive twenty thousand dollars um as a gift not for the wedding but because we're getting married and we wanted to know yeah yeah it really is um and we wanted to know what would be the best direction to or the best place for us to put that money um so just for some context uh we just finished school, um, her last December and me, uh, over this past summer. And we just started working full time. And, uh, the only debt that we have is, um,$18 ,000 in student loan. Um, and so we're trying to figure out if we should, um, save that money and snowball our debt or, or move into a better place or whatever.

1:16:47Ken Coleman:And I just wanted to know what you think would be a good direction for us to go in with that money.

1:16:54Dave Ramsey:Yeah. The problem with this is it's when you get a gift like this in a situation like this, it's$20 ,000 and it feels emotionally like it's$200 ,000.

1:17:05Ken Coleman:Right.

1:17:06Dave Ramsey:I mean, it's just exciting and wonderful and what a wonderful, generous gift. And then if you want to do something that's non-sexy but smart with it, it's hard because it's emotional. And so, you know, the answer to what we would teach you at Ramsey to do with any money that you get from any source is to work the baby steps. Why? Because that's the shortest path to wealth and put you in a position to do anything else you want to do, which is generosity, change your family tree, buy a house, all those kinds of things. And so we're always going to do that. But with a gift like this, it's very hard because this has got such sizzle on it that it's different than, you know, Dave, I got$20 ,000 in a mutual fund.

1:17:59Dave Ramsey:What do I do with it? That's different than I got a wedding gift and I'm newly married and newly graduated. It just has, that's got a lot of sizzle on it. You see what I'm saying?

1:18:10Ken Coleman:Yeah.

1:18:11Dave Ramsey:So it makes it very hard for you to do what I'm going to tell you to do, which is just pay off your student loan, man.

1:18:18Ken Coleman:Yeah. Yeah. No. Yeah. I'm thinking, yeah. It's hard to say, yay, yeah.

1:18:28Dave Ramsey:Yay. Hey, let's get that money. Yay! Yeah, I got it. I'm trying to set you up, man. But, I mean, I understand the feels on this. But, yeah, because the faster you get out of debt, the faster you have control of your most powerful wealth-building tool, which is not the$20 ,000 but is your income.

1:18:48Ken Coleman:Yeah, yeah.

1:18:49Dave Ramsey:So what's your income going to be now, the two of you?

1:18:53Ken Coleman:So I work two jobs, and I make around$90 ,000 a year, and my fiancée makes around$55 ,000. And those are your post-graduates jobs, right? Yeah. She's in her field that she studied. I went to school for ministry, and I worked that part-time. Okay. And I do HVAC and plumbing full-time, which I did not go to school for.

1:19:18Dave Ramsey:But that's not unusual. 80 % of pastors are bivocational in America today.

1:19:23Ken Coleman:Right. All right.

1:19:27Dave Ramsey:So you've got$140 ,000 household income. Yes. And you're how old? I just turned 22. Oh, see, that's awesome, man. You're killing it. Yeah. And now you've got no debt because of this wonderful gift. It's just emotionally hard to do that, but it's the smart thing to do. It is what I would do, and it's what I'm going to tell you to do. And if you were my son who was 22, I would tell you to do this. And I'm going to tell you to do this because I love you. But I'm also admitting simultaneously that it absolutely has no sizzle. And it's a sizzle gift with a wah, wah, wah suggestion. But the faster you get out of debt, the faster you can build wealth, the faster you'll be able to have a nice family, the faster you'll be able to do all these things.

1:20:11Dave Ramsey:And it's just I'm going to get you there as fast as I can every time. And I'm a thousand percent consistent on this. Kenneth is in Georgia. Hi, Kenneth. How are you? Hey, doing great.

1:20:21Ken Coleman:Thanks so much for having me today. Sure. What's up? I just discovered the Ramsey plan this past summer, and it's really quick with me. I've been enjoying it so far. We are on baby step two. But my wife and I are thinking about having a second child, and I just wanted to make sure that financially this is something we can afford. It's not going to crush us. I'm in a little bit more of a house than I really should be. we're having a mortgage payment of about$4 ,100 a month whereas we take home about$12 ,000 I do have a side gig that brings in about$2 ,000 to$4 ,000 extra a month so that does help a lot

1:20:54Dave Ramsey:that makes that number work as long as you do that until your other income goes up you're going to keep the side gig because otherwise you can't afford the house, you're right but that's not too bad why would you not be able to afford a baby? I don't understand

1:21:06Ken Coleman:we've just been having repair bill after repair bill with this house It needs a new roof. It's got foundation issues. We had to replace the entire HVAC. We've got to set up a new drainage unit. And I don't know, maybe I'm feeling a little overwhelmed. Maybe this is an emotional thing, but I'm just worried, can I afford this? Am I going to sink myself? Yeah.

1:21:24Dave Ramsey:Well, I mean, if you've got to trade a money pit for a baby, I'd trade for the baby. Well, that's a pretty easy call, yeah. Yeah, that's an easy decision. So sell the money pit and go get you something else. if you don't think the repairs are done. Sometimes these things go in waves, though, right? I mean, maybe you just finished your last wave of repairs and you won't have any for a while. That would be nice. I don't know. If that's the case, it's emotional. Yeah. If it's not, you're observing a logical pattern and you're wise to be concerned. Okay. So you've got to decide which one of those it is.

1:22:02Dave Ramsey:Do you think it's over?

1:22:05Ken Coleman:I think that these are one-time repairs. I think that I'm hiring you to be a little bit.

1:22:07Dave Ramsey:Well, there are each of the ones you named are, but, I mean, is the pattern over, or are we in a money pit? That's what I'm worried about. How old's the house? It's about 25 years old, and we've been in it for about a year. So you've been through the other mechanicals, the water heater, the dishwashers, all that's new? We have replaced the dishwasher. We have not replaced the water heater yet. 25-year water heater is done, bud.

1:22:35Ken Coleman:Yeah, it's going to need it real soon.

1:22:37Dave Ramsey:Yeah. So you got some things like that that are aging out that are what we call functional obsolescence in the real estate business. So they're functionally obsolete. And so, you know, that's the age of the house. And that doesn't mean it's a money pit. It just means it's an old house. And so, you know, one of our houses is 13 years old, and I'm putting a roof on it this week. And I just put a heat and air system in it. So it's the same thing. I just both of them went at the same time. And so, you know, that's just it just kind of goes with the calendar is what I'm saying. And so if you think you're facing that, then you may want to buy a newer property that's a little different and a little less expensive maybe.

1:23:20Dave Ramsey:And that is your family plan planning.

1:23:24Ken Coleman:Yeah, I would have wanted to know, is there an emotional attachment for you and the wife? Doesn't sound like you're too emotionally attached to it, but she. But I agree. I would take my losses early. I'd talk to a great real estate pro and do some homework on this house. What needs to be done? Is what's done already enough to move the house? I think you need to know all the information that you're dealing with because you're clearly frustrated.

1:23:47Dave Ramsey:Yeah.

1:23:48Ken Coleman:And I just learned a new phrase. I've got to figure out how to use it this week. Functional obsolescence. I've got to tell you, that's impressive. I don't know that I could get it out. I've got to practice that one in front of the mirror. It's the obsolescence. That's a tough word.

1:23:59Dave Ramsey:But that's a new one for me. I feel like if I drop that in the right room. Comes out of my real estate training back in the day. Way back in the day.

1:24:08Ken Coleman:I thought you were going to say it comes out of somewhere else. I didn't know where you were going.

1:24:11Dave Ramsey:It does that too.

1:24:15Ken Coleman:Functional obsolescence. Did I get that right?

1:24:17Dave Ramsey:All right. Well, I mean, you know with vehicles, it's planned obsolescence, right? You've heard that.

1:24:21Ken Coleman:Now you're showing off.

1:24:22Dave Ramsey:You've heard that. I haven't heard either. The whole auto industry plans for the car to deteriorate in a certain number of years.

1:24:28Ken Coleman:I feel smarter because I now know about functional obsolescence and planned obsolescence. Not a book that's coming to you anytime soon, but I do like that I know that.

1:24:37Dave Ramsey:Not a title that would sell.

1:24:41Ken Coleman:Yeah, not a good idea.

1:24:43Dave Ramsey:We're going to probably back right off of that on the Ramsey personality title list.

1:24:46Ken Coleman:Yeah, it's not going to make the cut.

1:24:48Dave Ramsey:Yeah, but the deal is stuff wears out. Hello. There it is. That's all it means. I like that. It's just a John Deloney word that means stuff wears out. That's all it is. It's a good Scrabble word. Oh, yeah. You can spell it.

1:24:59Ken Coleman:I couldn't.

1:25:00Dave Ramsey:I'd have to look it up. I think that's illegal in Scrabble. What do I know?

1:25:28Dave Ramsey:We've all done dumb things with money. I've done them with zeros on the end. One of the biggest mistakes I see people make with money is not having a plan for it. You've got to have a plan. You've got to be intentional and you need to get a budget. You have to tell your money where to go so you're not wondering where it went. Our budgeting app, EveryDollar, helps you do just that. It's the easiest and fastest way to make a monthly plan for every dollar you've got coming in and going out. Now's the best time to get started before the ridiculous holiday spending season gets here and sucks you in because you didn't have a plan.

1:26:00Dave Ramsey:Don't let that happen. You're done making that mistake. Go download every dollar for free in the App Store or Google Play today.

1:26:25Dave Ramsey:Welcome back to the Ramsey Show in the Fairwinds Credit Union studio. Ken Coleman, Ramsey personality. Number one best-selling author is my co-host today. He's also host of the Front Row Seat Show on Ramsey Network, which is exploding. If you've not watched this long-form interview show, there's a little bit of everybody been on there already. You don't want to miss it. Be sure and check it out. Benjamin is with us in Seattle. Hi, Benjamin. How are you?

1:26:52Ken Coleman:Hey, Dave. How we doing?

1:26:54Dave Ramsey:Better than I deserve. How can I help?

1:26:57Ken Coleman:Love to hear it. I got a question about rolling over my current 401k into a Roth IRA, even though I'm still employed with the 401k.

1:27:10Dave Ramsey:Don't think you can do it. Okay. You can roll it into a Roth 401k inside your company. Does your company have a Roth 401k option? Yes, it does. Okay, you can move it there, but I don't think you can move a 401k while you're still employed. Gotcha. Of any kind, traditional Roth, anything. So how much is in it? Not much. It's around$30 ,000. Okay, so you're going to create about$7 ,000 in taxes, okay?

1:27:39Ken Coleman:Okay. When you do that, because you're going to take a non-taxed item and make it taxable that year.

1:27:45Dave Ramsey:Do you have an extra$7 ,000 laying around to pay the taxes? the 401k is a Roth 401k oh I'm sorry oh you just wanted to roll it out to an individual from the Roth 401k I thought you were in a traditional 401k I'm sorry Roth 401k into a Roth IRA gotcha okay can't do it while you still work there I don't think gotcha don't need to unless you get wow you just got crummy options or what

1:28:17Ken Coleman:yeah crummy options um it's a two percent match and so just not getting a lot there uh my Roth IRA has probably 40 grand in it so I was just thinking if I had more a bigger number in one account, more growth versus, you know, two accounts.

1:28:39Dave Ramsey:No. Let's pretend that one, that the current individual is returning 10 % and your company was returning 10%. It's the exact same thing as if you put them together and they return 10%. Gotcha. A bigger number does not make you more money unless the percentage is different. The percent of return is different. You follow me? I do. Okay. And besides that, I don't think you can move it until you leave the company anyway. So I think you're there. And the 2 % matches 100 % on 2%. That's pretty good. You got 2 % before you got started. So, yeah, just be careful and pick out good options. Make sure you're fully funding the individual one.

1:29:21Dave Ramsey:And there we go. That's one of those math things that there's a couple of those that float around in the culture, Ken, that are interesting. And I don't know, I don't know, a lot of people think that if I put all my accounts together in one big lump sum and I make the exact same interest rate, then I'm going to make more money. You'll make more actual dollars, but you don't make more than the total would have been anyway.

1:29:52Ken Coleman:Correct. Because the sum hasn't changed. It's just now consolidated versus.

1:29:56Dave Ramsey:The total principal that is earning has not changed. That's right. and being in one pile, being in six piles doesn't matter. Right. Assuming the piles are paying exactly the same for purposes of this math brittle. Yeah. The other one is funny is I don't want to pay off my mortgage because I've already paid all the interest.

1:30:13Ken Coleman:Correct.

1:30:13Dave Ramsey:And that's not true. You don't prepay interest at all on an amortization mortgage. A standard mortgage is calculated like simple interest. And we can walk you through that for the fun of it. You take your annual percentage rate, say 6%, divide it by 12, which will be your monthly percentage rate. So that would be a half a percent per month. And so you're paying a half a percent on that month's outstanding balance. When you look at your amortization schedule and you say, what number of dollars of my monthly payment is going towards interest this month, you're going to find it to be, if you have a 6 % mortgage, exactly half percent of whatever is outstanding right now.

1:30:54Dave Ramsey:Ta-da. And that's called a simple interest calculation. But the amortization schedule, because it starts out with the largest possible balance, so more is going to interest on the first payment than ever will again. And every time you pay a payment, more goes to principal, less goes to interest. More goes to principal, less goes to interest every time you pay a payment. And because you pay so much interest on the front end like that, it makes people think they're prepaying interest, and they're not.

1:31:22Ken Coleman:That's right.

1:31:23Dave Ramsey:You're only paying exactly what you owe. So there's no disadvantage at any time to pay off a mortgage. No disadvantage, mathematically. You only paid what was appropriate. And so if you prepay, if you send them an extra$10 ,000, it slides you forward in the amortization schedule. So figure out what your principal balance is,$290 ,000 a day. move over in the amortization schedule 280 000 and that's what your next payment will look like not your next payment because now you have ten thousand dollars less that that half a percent this month is being multiplied on 280 versus 290 in my example okay and so a bunch of math gibberish there but all of that to say it's there's this interesting mythology that runs around then people make bad decisions on that i guess the other one that uh that those don't aggravate me just I'm a math nerd but the one that aggravates me is where people just go ahead and transfer their house prior to death I'm gonna just deed this to my kid it's a$200 ,000 house and I'm just gonna give it to him and I'm 60 years old and then I'm gonna live in it well honey there's just so much that you don't understand about what you just screwed up number one when you give someone an asset that's$200 ,000, you just inherit, you just got gift tax.

1:32:52Dave Ramsey:And when you get audited, they're going to tax you at 55 % of that gift. The gift tax is horrendous. So you can't just decide, I'm just going to give somebody money. You have to go through a few little tax moves in order to do that. You can do it, but you have to file some forms and do it on the unified estate tax credit. There's a way to do it. But you also just lost what's called stepped up basis on that so here me help you with this mom and dad bought the house in 19-0 whatever right and so they have almost they paid almost nothing for it and so when you get the house as a gift your basis for calculating capital gains is what their basis was which is nothing and so when you sell the house you're going to pay capital gains on the entire amount because you geniuses deeded it to you before they died.

1:33:44Dave Ramsey:If instead you got it upon death, you get what's called stepped-up basis, and that means that when you sell a house within six months of the death of the person that owned the house or a stock, either one, it's presumed that you sold it for market value, and your basis This is market value. Zero taxes. So capital gains tax on$200 ,000 is$30 ,000. So a nice little$200 ,000 home, you just made a$30 ,000 error. Try doing it on a million-dollar house. Yeah, you just made a$150 ,000 error, not to mention gift tax if you did it wrong. just because I'm just going to do this to my kid because I think I don't want the government.

1:34:35Dave Ramsey:And you just screwed up the whole stinking thing because you didn't know what you were doing and you didn't get some good advice.

1:35:09Dave Ramsey:You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage. To protect your biggest assets, I recommend using Ramsey Trusted Pros. Whether you're looking for car, home, or any other type of insurance, Ramsey Trusted Providers have been coached and vetted to serve you like we would. Find what you need at RamseySolutions.com slash insurance.

1:35:43insurance.

1:35:59Dave Ramsey:Everybody needs insurance, but it can be hard trying to find the pro who isn't just looking to make a buck. Agents who know their stuff, they're hard to find. And with a Ramsey Trusted Insurance Pro, you'll never have to deal with sleazy business or slimy salespeople. A lot of sleazy, slimy stuff out there. Because we interview these guys, we vet them, we coach them to make sure they're market experts who have your best interest at heart. Go to RamseySolutions.com slash coverage to find the type of insurance you're looking for. Connect with a Ramsey Trusted agent or click the link in the show notes.

1:36:34Dave Ramsey:Stephanie's in Orlando. Hi, Stephanie. How are you?

1:36:37Ken Coleman:Hi, I'm good. How are you guys doing?

1:36:39Dave Ramsey:Better than I deserve. How can we help?

1:36:42Ken Coleman:Good. Well, I'm recently engaged, and I'm trying to figure out if I should buy a house before we get married or wait until after.

1:36:54Dave Ramsey:Absolutely not. Please don't.

1:36:57Ken Coleman:I'm going to beg you not to. Not to wait?

1:37:01Dave Ramsey:No, no. Don't buy a house until you're married.

1:37:03Ken Coleman:Don't buy a house. No, of course. I don't want to buy a house with him, but he has some debt. So I'm trying to figure out, should we get Mary to help him pay the debt off and then we buy a house? Yes. Or should I go ahead and buy the house on my own first? Do you think Dave's being clear enough?

1:37:23Dave Ramsey:Sometimes he's fuzzy. Let me stop that, Stephanie. I'm sorry. That's not fair. I need to tell you why. Okay. Here's the thing. You're getting ready to join your lives. The best way for you guys to become wealthy is for you to join your lives, combine everything, assets, liabilities, incomes. And we together are aligned on our steps and what the future looks like and the steps to get there. Okay? And when you do that, it's a major plus for your relationship because when you can agree on your spending, You're agreeing on your fears, your dreams, your life. Money's not important, but where it goes speaks loudly who you are and what you dream about.

1:38:15Dave Ramsey:And when the two of you combine, and in the old marriage vows it used to say, richer for poorer, sickness in health, unto thee all my worldly goods I pledge. and it creates a unity in a joined approach. What ends up happening, and we see it in the actual factual data 10 years later after you're married, is you have what we end up calling in the financial world the marriage advantage to where a 35-year-old married couple has a net worth that is far beyond a couple of single people that are 35.

1:38:54Ken Coleman:Right. So even if that means delaying some things.

1:38:58Dave Ramsey:No, it's just not delaying them much, but it just we're putting them in an order that might not be comfortable. Right. So we're going to pay off the debt. We're going to build an emergency fund. Then we're going to get a big down payment and buy a nice home on a 15-year fix where the payment's no more than a fourth of your take-home pay. You're going to start putting 15 % of your income away towards retirement after that, and you're going to become very, very wealthy in about a decade.

1:39:21Ken Coleman:Yep, exactly, because I'm there now on my own, but seeing that my plan is to join us.

1:39:27Dave Ramsey:So how much do you have in savings that's not retirement?

1:39:32Ken Coleman:About$50 ,000 right now.

1:39:34Dave Ramsey:And how much debt does he have?

1:39:36Ken Coleman:He has about$31 ,000.

1:39:39Dave Ramsey:Perfect. When you get back from the honeymoon, pay it off.

1:39:44Ken Coleman:That's kind of what my thought was, because I still want to save some more money for a down payment, because even$50 ,000. Not enough.

1:39:50Dave Ramsey:It's just okay. Pay off the debt, and then you've got a combined household income of what when you come back from the honeymoon?

1:39:57Ken Coleman:Maybe around$90 ,000,$95 ,000 maybe.

1:40:01Dave Ramsey:Good. And so you're what, 25, 26?

1:40:03Ken Coleman:Oh, I am 37. 37. Okay.

1:40:06Dave Ramsey:All right. What do you all do for a living?

1:40:08Ken Coleman:I'm a production planner in manufacturing.

1:40:13Dave Ramsey:What's he do?

1:40:15Ken Coleman:He's in shipping, receiving for manufacturing as well. Okay. Cool.

1:40:19Dave Ramsey:Cool. All right, perfect. So you are a planner. That's why you're lining up on all this immediately. Exactly. The way your mind works.

1:40:27Ken Coleman:All the numbers written down. That's the way your mind works. I've been listening to you guys for five years now.

1:40:31Dave Ramsey:Okay, well, you know the baby steps then, and I'm just walking you through them as a combined couple. We're going to take your 50, pay off his 30. That leaves 20. Now we've got a$90 ,000 household income. The 20 is probably your emergency fund. So we start from scratch, real quick, build our down payment. Then we buy a home. Meanwhile, or shortly after buying a home, one of the two, we start baby step 3B or 4, 15 % of your income going into retirement. You've heard all this before, hadn't you?

1:40:57Ken Coleman:Oh, yeah. Plenty of times. Actually, I didn't include my emergency fund in that. Oh. I have a three-month.

1:41:03Dave Ramsey:Okay. Then you've got a 20-head start, not a 50-head start towards your down payment. Exactly. Okay. If your emergency fund's big enough for our emergency fund, that is.

1:41:13Ken Coleman:Not yet, I don't think, with what I think a new mortgage will be.

1:41:16Dave Ramsey:Okay. Well, then, yeah, we'll get there. But, I mean, you know exactly what to do. It's just a matter of when, what, and why. But, no, don't look for a hack. Just go straight through it. Exactly. It's the fastest way. It's just not popular. It's not cool. Your friends are going to go, what? Who gives a crap what you think? You don't have any money, and you're not living in my house. So, I mean, what? You know, these are not real friends. Real friends go, yes, you're so smart. You're wise beyond your years. Go do the smart stuff. Yeah, that's very cool. Congratulations. Hey, I'm going to send you a copy of the Total Money Makeover, the baby steps.

1:41:57Dave Ramsey:You already know them, but I'm going to send it to you anyway as a wedding gift. Very cool. That's fun.

1:42:01Ken Coleman:Yeah, I like how wary she is, you know, not jumping in emotionally, very solid. And I'd love to know what she has in retirement. We didn't get to that, but I think that they're going to be in great shape. The other thing I would say, we didn't get to this, but for people that are listening watching this. In a situation like this, and I'm sure she's done this, you want to make sure that this person is on board with you before you get married on the finances. It's not something you want to come in. And in this case, I'm not saying this is happening here, but you want to be careful not to come in.

1:42:34Ken Coleman:We combine finances. I'm going to pay all this debt off and they go, woohoo, and then they go get more debt. Super important that you've got this stuff figured out pre-marriage.

1:42:43Dave Ramsey:Amen. Loretta's in Texas. Hi, Loretta. How are you?

1:42:47Ken Coleman:I'm just fine. How are you doing today?

1:42:49Dave Ramsey:Better than I deserve. How can I help?

1:42:52Ken Coleman:Well, I am 64 years old, and I'm so ready to retire, but I'm just worried about my finances. Okay. I have$8 ,000 in an emergency fund. I have$12 ,000 in 401K. I have$15 ,000 in savings. My home is paid off. My vehicle is paid off. And I have no other debt. Okay.

1:43:21Dave Ramsey:And what will you live on if you retire?

1:43:27Ken Coleman:Social Security. Well, I mean, I can't just retire. I'm probably going to work the rest of my life. But the job that I have now, I am a truck driver. I do super loads. And so, you know, it's physically demanding. It's a lot of work, but, you know, at some point, you know, I want to be home.

1:43:48Dave Ramsey:What do you make?

1:43:51Ken Coleman:$110 ,000 a year.

1:43:52Dave Ramsey:Okay. Why have you not saved any?

1:43:55Ken Coleman:Well, I mean, because I paid off debt.

1:43:58Dave Ramsey:Okay, so your debt's gone now.

1:44:00Ken Coleman:My debt is gone now. So how much longer do you want to work and pile up some cash?

1:44:04Dave Ramsey:I mean, why don't you try living on nothing and let's put$100 ,000 away in the next two years? $50 ,000 a year. 50 a year well you don't have any payments you're on the road

1:44:14Ken Coleman:I can actually put even probably put even more than that good because it's just me good

1:44:25Dave Ramsey:well let's not retire on social insecurity

1:44:30Ken Coleman:okay so hang in there another couple of years how much can you put away out of 110

1:44:36Dave Ramsey:if you go whole hog. You just go all in, girl.

1:44:41Ken Coleman:75. Okay, that's

1:44:43Dave Ramsey:150 in two years, right?

1:44:46Ken Coleman:Yeah.

1:44:46Dave Ramsey:Alright, now that makes you 66 years old and if you then will set your budget up with no debt to live on your Social Security, if you invest that with a Smart Investor Pro and some good mutual funds, it will double every seven years. So at 73, you'll have$300 ,000 if you don't touch it and live on the Social Security. Now you're building a nest egg. Okay. And that's where I want you to go. This idea of$12 ,000 and I'm ready to retire. Uh-uh. Uh-uh. I don't want to live on Social Security. It's not enough. I've been working too hard all these years. You have for sure, kiddo.

1:45:44Ken Coleman:Hey, what's up? Dr. John Deloney here. The new dates have dropped for the Money in Marriage Getaway over Valentine's Day weekend in 2026. This is your chance to hit pause on everything in your life and reconnect with your spouse over a long weekend in Nashville, Tennessee. Me and my friend Rachel Cruz will be digging into topics like sex, money, communication, and more. This weekend is happening on February 12th through the 14th, and early bird prices start at$749 per couple, but the prices will be going up soon. Get your tickets today at RamseySolutions.com slash events.

1:46:37Dave Ramsey:Jake's in Minnesota. Hi, Jake. How are you? Hey there. Thanks for taking the call. Sure. What's up?

1:46:44Ken Coleman:I was just calling to ask me and my wife are trying to figure out if we should work on paying down our current mortgage, which we secured at 2.75%, or if we should be working on saving up our savings to get into a bigger home down the road. Pay off your mortgage.

1:47:06Dave Ramsey:As fast as you can. Okay, just go at it. Yeah, just go at it. Now, I mean, you need to be working what we call the baby steps. Have you heard us talk about those? Yep, I'm familiar. Okay. And so are you out of debt everything but the home? That's right. And you have your emergency fund of three to six months of expenses. Yes. And you're putting 15 % of your income into retirement plans.

1:47:37Ken Coleman:That is something that we've backed down a little bit on recently. My wife and I, we don't have great matching from our employers. It doesn't matter. It doesn't matter.

1:47:46Dave Ramsey:You need to be putting 15 % of your income away for retirement. And good growth stock mutual funds, that's going to build wealth for you. And then beyond that, with any money we can find in the budget that we want to throw at the house, let's just start paying the house off systematically. and those are the things that the people that become millionaires the fastest do. They steadily invest in their 401ks and they pay off their homes. Data after data after data. We've got 10 ,000 of them we interviewed. We know.

1:48:21Ken Coleman:Okay. Yeah, I think we're pretty close to the point where we're almost ready to take the jump on the new home, which is what we've been trying to lay out.

1:48:30Dave Ramsey:Well, then it doesn't matter. It doesn't matter. You're just going to sell this house, and the equity is going to come out of it anyway.

1:48:37Ken Coleman:Fair. I think we're just trying to make sure that if the right house comes along, that we have enough liquid, that we don't have to make a contingent offer. Would that ever make a difference?

1:48:46Dave Ramsey:No, you have to make a contingent offer because you have to sell the house. You can't take on two mortgages.

1:48:53Ken Coleman:I think there might be a little room for us to own both for a few months, but, yeah, correct. You don't want to turn yourself into a motivated seller.

1:49:02Dave Ramsey:Thing doesn't sell for six months and you're paying payments on it. You're going to give the stupid thing away. You don't want to do that.

1:49:11No.

1:49:12Ken Coleman:Good point. We are.

1:49:13Dave Ramsey:Calm down. Go take a cold shower. You're getting house fever. Yeah. You've been out looking at the weekends at the open houses, haven't you? Yeah. Yeah. We've been working on it. You've been working on it. It's working on you, too, dude.

1:49:34Ken Coleman:We're expecting in March, and we've just been kind of looking at our current home situation and trying to figure out how we can make that next step happen. Yeah.

1:49:43Dave Ramsey:Yeah, it's okay to calm down and go after the baby. As a husband and grandpa, I won't recommend you plan a move during a pregnancy. you're not going to be a popular dude 10 years later she'll still bring that up to you that time that you moved me while i was nine months pregnant yeah she'll remember that for

1:50:06Ken Coleman:the rest of her life she won't forget and i gotta speak on behalf of all babies they have no idea how big the house is uh a lot of this is just very natural baby advocate yeah i am i am it's first time i've taken that for babies i'm here to speak on behalf of the children people you know No, Dave, I really, no, I just hear this a lot from young couples. And by the way, it's very normal and I'm not in any way judging it. But we start to think, well, this is what the nest should look like. And this is what the nest should feel like. And in all reality can get you in real trouble. And the scenario that Dave gave you, we get that call a lot where people, they thought it was going to work out and then life has got a different idea.

1:50:45Ken Coleman:And then you're stuck as opposed to being patient here and the baby's going to be fine. You don't need the perfect nursery and all the things. It just doesn't matter. You're going to be so exhausted, you don't even want to think about all this. So I think Dave's right. Patience, patience, patience.

1:51:01Dave Ramsey:Yeah, and definitely contingency. Absolutely. That or sell the house and move into an apartment while you're looking. So you don't have – you ain't going to do that for sure. Two moves, that'll get you in real hot water. That's gross. Yeah, it could happen, but yeah. Yeah, no, because here's the thing. Honestly, you start talking about 279 on one side of the fence like this is a bargain. Right. Okay. Like you got, I got this cheap interest rate. Dude, after the 11th month and the house hasn't sold, that cheap interest rate is going to look like it's 27%, not 2.7. And you're going to be going, oh, God, this is killing me.

1:51:37Dave Ramsey:We got to get this house moved. You're going to be calling a realtor every day. You're going to be dropping the price, dropping the price, dropping the price. Then somebody's going to come in and lowball you, and you're going to take it. do not get yourself in that position. And so it's easy. Do a contingency deal or don't do it. And so I had one guy, he said, well, God told me to do it. And I said, no, he didn't. Yeah, he did. No, he didn't. I'm positive God did not tell you to do that. He said, how do you know? I said, because the Bible says the blessings of the Lord have no sorrow added to them.

1:52:10Dave Ramsey:And there's sorrow added to your mess you created here. And then you're trying to blame it on God. and God's up there laughing going, you're just one of my stupid children. And he's got a bunch of stupid children because I've been one of them.

1:52:23Ken Coleman:Me too. But that's not fair, Dave. You used God's word to debate God's voice. That's not fair. You were not playing fair. That's such a pro move, by the way. That's a good one. That's a flex. That's a flex.

1:52:36Dave Ramsey:All right. Alan's in Georgia. Hey, Alan, what's up?

1:52:41Ken Coleman:Hey, how you doing today?

1:52:42Dave Ramsey:Better than I deserve. How can I help?

1:52:45Ken Coleman:Yes, sir. So I've inherited some land from whenever my mom passed away. And she's kind of been sitting there not making any money. And I think it's probably time to sell.

1:53:00Dave Ramsey:How much? What's it going to bring?

1:53:04Ken Coleman:Conservative 350 to 500.

1:53:07Dave Ramsey:Wow. Nice inheritance.

1:53:10Ken Coleman:It's about 64 acres.

1:53:12Dave Ramsey:Thanks, Mom. Wow. Wow. So what are you going to do with$400 ,000,$500 ,000?

1:53:18Ken Coleman:Well, I kind of wanted to get into real estate. I've been doing some research on beach condos and kind of looking at the return on investment is hovering from 8 % to 10%. And kind of wanted your opinion on it. Where do you live in Georgia? I'm in Boston, Albany, but it's in Leesburg, the land.

1:53:47Dave Ramsey:Well, the reason I asked is resort real estate, mountains, beaches, lakes, is the most volatile type of real estate. It's the first thing that goes up when times are good and the first thing that goes down when times are bad, and that includes the rental income on it. so if you have some kind of a problem and the economy slows down, you're going to be the first one to take it on the chin. The value goes down, and the rentals are hard to keep booked, so I don't recommend resort real estate as an investment. If you want to buy a toy for your family to go stay in at the beach, that's a different discussion.

1:54:32Dave Ramsey:You pay cash for toys, but that's not what you said. So instead, I would buy a boring rental property that's steady, and it's probably close to you, or two or three. I'd rather you buy two or three$200 ,000,$150 ,000 houses in your area there, and they'll go up more steadily than those beach condos will. They won't go up as much during good times, but they won't go down as much during bad times. and you create this tortoise versus the hare type of investment portfolio.

1:55:07Ken Coleman:I've got a question for you on this. 8 % was his goal. He stated it on the call. Why wouldn't you say, just put that in our investment, our four buckets that we talk about. Why not invest it in the market? Why even take on the headache of real estate?

1:55:25Dave Ramsey:Well, 8 % is his cash on cash. Got it. that's how much he makes in his pocket versus what he invested. That doesn't count how much it goes up in value every year. Fair. And it doesn't count that he can also shelter a portion of it by doing depreciation. So those three numbers added together on an 8 % are going to sound more like 17%.

1:55:45Ken Coleman:Okay, got it.

1:55:46Dave Ramsey:And then it makes it worthwhile. I look for 8 to 10 on a residential if I'm buying it. On commercial, I look for 10 to 12. Cash on cash. But I fully expect to return about 20 on a 12, including it's called an internal rate of return, which includes the increase in value and the write off of the depreciation schedule. All right.

1:56:23Thank you. Thank you.

1:56:53Dave Ramsey:sailor. Drunken sailors spend their own money. Congress spends ours. Fact. Fact, Art. You can tell Art used to hang out with Ronald Reagan a lot. That's a great line right there. That's fabulous. All right, here we go with Gerard in Texas. Hey, Gerard, how are you? I'm better than I deserve. Dave, how are you all? The same, sir. How can we help?

1:57:16Ken Coleman:So my wife and I are on baby step two. We should be done with about$40 ,000 worth of debt by the end of the year, and we're going to be moving on to four, five, and six. I already kind of have plans for retirement and early payoff of the house, but I'm confused a little bit on the college saving side of things.

1:57:35Dave Ramsey:Cool. How old are your babies? Four and seven. Awesomeness. Okay. What are you confused about?

1:57:42Ken Coleman:So I looked at the Dave Ramsey calculator on how to save for college and what we would be putting aside just based on what we think living expenses are and tuition will be. That number seemed high around like$1 ,100 a month or something like that. I didn't know if that was normal to set that much aside in a 529 or if there's a happy medium.

1:58:05Dave Ramsey:I would not do that. Okay.

1:58:06Ken Coleman:What would y 'all recommend as far as how to tackle the tuition versus living costs?

1:58:13Dave Ramsey:Yeah, honestly, I need to go look at that calculator, it sounds like.

1:58:20Dave Ramsey:So tuition has averaged 7 % to 8 % per year inflation rate for the last 40 years or so. And so regular inflation is 2 % to 4 % average. I mean, one year Biden, we had 9.7. But, I mean, the normal inflation rate is 2 to 7 or 2 to 4. And then with this, so that's what it's going up. So you got to, you know, University of Texas is probably$14 ,000 right now in state tuition. And so if you wanted to say, okay, four years of that is$60 ,000, right? Correct. Okay. And then add 8 % a year for a decade. and that's that's where that that's going to be your tuition cost right um and so that that's what you would do and then yeah we use a 529 because if you put in you know a couple grand or something a year not a month but a year um you're gonna have about 90 or 100 you probably have about 140 000 bucks in there something like that if you started with the babies and so you'll have somewhere around$100 ,000,$150 ,000 in there.

1:59:31Dave Ramsey:And a lot of that is growth. And if it's in a 529 in a mutual fund, a mutual fund in a 529, it's going to grow tax-free for tuition. And so if you have$100 ,000 worth of growth, see, if you put it, okay, let's say you put in$2 ,000 a year for 10 years, that's$20 ,000 you put in. If there's$120 ,000 in there, there's$100 ,000 in growth. You got me? No taxes on that$100 is important because that's a$20 ,000 tax bill,$30 ,000 tax bill that you're avoiding by putting the mutual fund in a 529 for purposes of the kid. That makes sense. Yeah. So, yeah, I mean, a couple grand a year is going to take you a long, long way towards doing this.

2:00:14Dave Ramsey:And the other thing that we would not have said 10 years ago that we will say today is I think higher education is going to look dramatically different 15 years from now. Wouldn't you, Ken?

2:00:25Ken Coleman:I've been pretty bold on that. And I believe you're going to see a decentralization. You're going to see specialties like obviously medicine, law look very similar to how we see them today. But as far as the traditional four years and you got to take a bunch of undergrad stuff and you got the prerequisites before you get to the major, I think that's going to splinter. I think the onset of AI, I think that we are actually at a, I think, a fever pitch on what the American people are willing to put up with.

2:00:57Dave Ramsey:And I think when you see on the ripoff of meaning, willing to pay for it, give you real numbers.

2:01:02Ken Coleman:So, you know where I'm coming from, Gerard Gallup came out with information this year in a poll. 46 % of American parents said they would prefer that their kids go into trades and not into college. Our good friend Mike Rowe, I call him the Oprah Winfrey of the trades. He's been banging this drum for a long time. Oh, God, don't do that. You only would take that as an insult. But I do think Dave's right. I don't think you're going to see the exorbitant costs. I don't think – now, you've got to plan for it. Yeah. But I don't think you're going to see that. I think we've kind of jumped the shark.

2:01:35Dave Ramsey:Well, the student loan debacle has highlighted that some of the higher ed stuff is out of control. Yeah. And so I do know that people are going to be more cognizant of what they pay and what they get for what they pay. That's right. For sure. And I think that's going to create a downward pressure on that inflation number that I gave you of 7 to 8 percent. So I don't think they're going to maintain that.

2:02:02Ken Coleman:I think you're going to see, Dave, a little quick prediction. I think I've been studying this. I think you're going to see private sector competition for traditional education. I think people are going to come along and go, wait a second. We can provide training for what corporate America really wants for a whole lot less money and make a ton of money doing it. And you're going to see these outsized tuitions go away because they can't compete with the private sector. Google's doing their own training program, a six-month program. I think we're going to see more and more big-time companies are going to outsource their own education training to private education companies.

2:02:37Ken Coleman:Watch for that. I think that's going to happen.

2:02:39Dave Ramsey:All of that to say that if you have put a couple grand a year for a four-year-old and a six-year-old, you're going to have$100 ,000 plus in there when you get there each. And that's going to give you a real head start into whatever you want to do. whether it's a trade a certification program or an actual four-year degree um and um which i'm not we're not against four-year degrees we're just against getting a degree and for four years in left-handed puppetry and from a school where you pay 150 000 bucks a year to go um so they can brainwash your child into being a communist and so that i'm against that i think that's a problem And so as a parent or a grandparent, I'm not writing that freaking check anymore.

2:03:26Dave Ramsey:And I'm not by myself. So that's what we're seeing. So I think you're doing your individual planning, but you're doing it in the context of what is happening culturally right now on this subject. That's why we wanted to comment on it. So it's very good. And, Ken, I think it's worth highlighting a couple things here while we're at it. You've been working with self-improvement in the self-improvement space, and the new show, Front Row Seat, is helping people learn leadership skills and highlighting stories of great men and great women and what they did to get there. And, you know, what we discover every time we do that, if you read biographies of great people who are successful in any function, whether business, ministry, sports, whatever, you find that they were the secret sauce, not where they went to school.

2:04:20Dave Ramsey:That's exactly right. And so the number of times that people become successful due to the particular school that they went to is precisely zero.

2:04:34Dave Ramsey:And yet we go, well, if he went to Harvard, bullcrap. Nobody cares out here is the problem. It's all theory. There's no data to back it up. 78 % of the Fortune 500 companies have a CEO that went to a state school. Yep. and that's eight out of ten shut up had a 2.5 they didn't go to wharton they didn't go to princeton they didn't go to you know muckety-muck school they went to a state freaking school penn state michigan state that's right university of tennessee that's where they went to school they didn't go to vanderbilt they didn't the 78 of the ceos of the fortune 500 companies not straight there's data for you yeah okay so where you go to school doesn't matter it's a big deal it's right and it costs out the butt yeah and there's places and we're beginning

2:05:24Ken Coleman:to see the american people and this isn't just parents anymore the young people are going they're reading the stories they're paying attention they're older brothers and sisters they're going there's not a value exchange here no i can't spend 250 000 to become a social worker

2:05:39Dave Ramsey:for the state of tennessee with a master's degree and make 38 000 a year that's dumb butt that's right. The ROI is not there anymore. It just doesn't work. So you guys got to think about stuff like that. And Gerard, you're very wise to stay on top of the whole idea and be watching and monitoring all of this as you go. That puts us our The Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

2:06:18Thank you.