Fix The Money Mess That’s Stressing You Out

6:58Dave Ramsey:Yeah, because we're not going to stay at 45 when we have a market income or market value of 100. Okay. So a couple of things backing up then. So number one, the two of you need to sit down together and work on the budget. You can do the details, but he needs to feel the weight of the responsibility of this with you and be carrying it emotionally. You're carrying it by yourself and it's crushing you. I can hear it in your voice. Okay. And you're still harboring a large amount of resentment, which is fair. You're still pissed off about him running$200 ,000 in the hole without bothering to tell anybody.

7:43Dave Ramsey:Okay. That's thing one though. You're not got, your only shot at your marriage getting through this is the two of you hooking arms, putting your, both of you putting your shoulders in the same end of the harness together and pulling this wagon together. Okay. Now you can do the details. You're the detail person and you definitely have to know what's going on because we can't count on him. Okay. So that's thing one thing too. Then once you're doing that, then I want you to go find where all this money's going because stop his 401k immediately. You don't go$2 ,700 in the hole while funding a 401k.

8:20Dave Ramsey:That's not logical. That's borrowing money to put it in a 401k. No, I'm not doing that. So stop his 401k in the morning or tonight or whatever. Stop yours. No saving money. No investing money.

8:32Rachel Cruze:And I'd be selling the cars at this point.

8:34Dave Ramsey:That's the next one. Sell the cars. These cars have got to go. They're crazy in this situation. But you've got to go find where all this money is going. Because when you add this up and look at the gross amount that you guys have been making and you're only getting$7 ,000 home, something's wrong. Or if you've got a huge tax refund, something's wrong. There's gaping holes in this.

8:56Rachel Cruze:Well, and I think a big part of his 160 is the bonus, which they use to pay off the credit card. So that's not in the paychecks either.

9:02Dave Ramsey:You've got to figure out where all this is going because it doesn't add up to$250 ,000. And that's what we've got to get to.

9:38Rachel Cruze:where you are could be costing you hundreds of dollars every year. Y 'all, the average savings account pays less than half a percent. So let's say, for example, you've got$20 ,000 saved. You might earn around$70 a year, but with a fair wins, high yield savings account earning 3 % APY or more, that same money could earn you over$600. And that's real money that you can use towards the baby steps. So don't let temporary comfort keep you stuck. Check out the smart bundle from Fairwinds Credit Union. You get a high yield savings account, a no fee checking account, and the Ramsey BeWeird debit card.

10:16Rachel Cruze:Go to fairwinds.org slash Ramsey to learn more and make the switch today. That's fairwinds.org slash Ramsey, insured by the NCUA.

10:33Dave Ramsey:Jay's in Oklahoma City. Hi, Jay. How are you? I'm doing well. I'm doing well. How are you all? Better than we deserve, sir. How can we help?

10:41Rachel Cruze:Yes, I'm just calling. I am 27 years old. I still currently live with my parents. I am$35 ,000 to$45 ,000 in debt. That's with credit cards, two vehicle loans, and personal loans. and I make roughly$3 ,200 to$3 ,500 a month. I work two jobs and I'm going to school. And I'm just, you know, very overwhelmed and I just feel like I'm financially behind in life.

11:14Dave Ramsey:Wow. So did you say you had two car debts?

11:19Rachel Cruze:Yes. It's a 2021 Hyundai Elantra and a 2018 Denali. um the elantra i have about 11 000 left on it uh the denali i have 21 000 left on it

11:36Dave Ramsey:are you married i am not why do you have two cars uh the 2021 hyundai elantra is mine

11:45Rachel Cruze:the 2018 Denali is my father's. He is disabled, so he is on a fixed income, and he had no vehicle. He had one, but that broke down on him, and we both needed reliable cars. So that, I believe, looking back on it, was too much of a burden to take on.

12:11Dave Ramsey:Yeah, you need to sell it. You can't afford the Denali. It's one of your problems. What's the nature of your father's disability, hon?

12:21Rachel Cruze:He has nerve damage, and he has severe arthritis in his hands.

12:29Dave Ramsey:So some days— You said you're living with your parents. Your mom is involved, too?

12:36Rachel Cruze:Yes. She is the only one working besides me. What does she make? And she makes about, she makes 20 an hour.

12:46Dave Ramsey:Okay. And your dad has disability income coming in, I assume.

12:50Rachel Cruze:Yes.

12:51Dave Ramsey:Was the, was, is this just SSI or was he military or?

12:58Rachel Cruze:It's SSI, but I guess something came up. They said that my mom makes too much money, so they're threatening to cut it off.

13:10Dave Ramsey:No, there's not a thing where the spouse makes too much money if someone's permanently disabled. Your mom can make$800 ,000 a year and your dad still gets his disability SSI. So somebody's confused somewhere on the messaging. Okay, so here's the deal. Your dad's income from disability and your mom's$20 an hour adds up together to determine what kind of car they pay cash for. And they manage their lives. They're like grownups and stuff. And the Denali's gone. you are way too broke to be supporting other people.

13:49Dave Ramsey:That's why you're stuck.

13:51Rachel Cruze:How does that hit you, Jay?

13:57It hits me, but I've seen it and I've looked at the numbers.

14:03Dave Ramsey:I've known it for a while, and it's like a realization. Yeah. I'm just the mean guy that said it all out loud.

14:12Rachel Cruze:Well, it just, you know, hurts because I want to help.

14:15Dave Ramsey:I want you to be able to help, but you're not helping, you're hurting. Because you've, quote, you guys have woven together a situation that is not good for any of you. And that can happen. You can do the wrong thing out of a good heart, right? And you've got a great heart. You're trying to help your dad. I appreciate you doing that. That's good. That's a good man, okay? Trying to help your mom. And you're living there. So you feel like you owe them because you do. That's okay. I get all of that. That's fine.

14:42Rachel Cruze:But basically all the debt you're feeling are these two cars. Yeah.

14:45Dave Ramsey:Yeah. I mean, that's basically all of it. If you didn't have the Denali payment, your life all of a sudden starts working again. Mm-hmm. Yeah. And so, yeah. And then we begin to work extra like a crazy man and clear up the credit card debt, clear up your little$11 ,000 car debt. and you'd be debt-free in, gosh, about a year. Because you don't have any overhead. You're not paying rent, right? No, no, I'm not. Yeah, I mean, and you're buying some food maybe and stuff for the house and maybe paying a light bill or something, but you don't have much overhead. So basically we're talking about$2 ,500 a month, which is$30 ,000 a year that you could be throwing in debt, and that means you're debt-free in a year.

15:33Dave Ramsey:Of course, we're getting rid of the Denali, too, but that's part of the equation. But, yeah, once that's gone and you do these things, and then mom and dad scratch together a little bit of money, and they go buy a$5 ,000,$6 ,000 car. And that's fine. There's nothing wrong with a$5 ,000,$6 ,000 car. You can get a lot of car for five or six grand. It's not pretty, but it's reliable. And you're not trying to win any sex appeal jobs anyway. They aren't at their age. They don't need to pick up a date. They're fine. So, I mean, that's it. And then you start working to get out on your own, and you can emotionally support them and coach them and be there for them and drop by dinner occasionally for them and that kind of stuff.

16:15Dave Ramsey:And then you start your own life, and that's going to be the best thing that ever happened to them and to you.

16:19Rachel Cruze:How will that conversation go with your parents, Jay? I think it will go very well. You do? Good. Yes. I have a great relationship with my parents, and my dad is always telling me that he wants me to win. He wants me to do better than he did. Okay, good. Yeah.

16:39Dave Ramsey:That's wonderful. That's a very supportive environment.

16:41Rachel Cruze:And how much is that payment a month? Which one? The Denali.

16:46Dave Ramsey:The Denali is$508. Yep. Wow, really? Okay. I would have guessed double. Okay. But just the same. So, yeah, I don't think it's good for them to have that burden, and I know it's not good for you. The car was, oh, you had a valid need, and you purchased about four times as much car as you should have or five times as much car as you should have to cover your dad's need. And then that's when it exposed all this other stuff because when you put stress on that budget, all the little stupid things are really exposed then. You can kind of get away with those and forget about them. until you put stress on it.

17:27You know, and I can see how, you know,

17:30Rachel Cruze:it's$21 ,000 Denali, you know, versus a brand new$90 ,000, right? So he's probably thinking in his head as he's doing it, oh, this is a good deal. Okay, it's not crazy. Like I can, and then, but here's the problem are these small, these purchases, small purchases that we make start, when we justify them, you put them in the whole picture of your math and a$500 car payment making, what was it,$3 ,500 a month. That's what he said, yeah.

17:55Dave Ramsey:Yeah. $40 ,000 a year for a$20 ,000 car.

17:58Rachel Cruze:Eating, eating away. Yep. With another$11 ,000 car.

18:01Dave Ramsey:And another$11 ,000 car. And credit card debt. Yeah. So that's what you got to do. So hang on, Jay. I'm going to send you a copy of the book, The Total Money Makeover, that shows you exactly how to do the baby steps that we talk about here. And we're also going to sign you up for every dollar for our budgeting app. And it'll hold your hand as you walk through this process. But beans and rice, rice and beans. And what will happen is, is you'll get a new level of energy when you have a clear path and you can map out, I'm going to knock that debt off, and then I'm going to knock that debt off, and then I'm going to knock that debt off, and then by this date, I'm going to be completely free, and then I'm going to save my good three to six months down payment.

18:36Dave Ramsey:And, you know, by somewhere in that timeline is when you decide you're going to move out on your own. And all of these things come together. You get out on your own, and you're debt-free, and you've got$10 ,000 in the bank, you're a different guy. It puts you in a whole different world.

18:53Rachel Cruze:And what's wild is all that can happen in 18 months.

18:57Dave Ramsey:Less.

18:58Rachel Cruze:Well, being debt-free and saving up$10 ,000. Yeah.

19:01Dave Ramsey:Yeah. Oh, yeah. You're right. You're right. Good point. Yeah. And only 18 months. And think about where you were 18 months ago, about right here. So nothing changes until something changes. So hang on. We're going to send you a copy of the Total Money Makeover and Get you moving here, my man. Get you moving. So, Rachel, I would say that in 30 years of doing this, that a high percentage, and I'll call it maybe even 90 % of the people that are struggling with money issues, they're either struggling with their spouse or they're struggling with some other family members with money. There's a relational component.

19:48Rachel Cruze:Nine out of ten.

19:50Dave Ramsey:There's a negative relational component to about nine out of ten people that are having money problems.

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21:45Dave Ramsey:Kevin is in Charlotte, North Carolina. Hi, Kevin. How are you?

21:50Rachel Cruze:Doing well. How are you?

21:51Dave Ramsey:Better than I deserve. What's up?

21:54Rachel Cruze:So my question is, I'm currently living with my girlfriend, and we want to start to look to buy our first house. We're currently renting. I make good money. She has a lot of money that she made throughout college, and her dad is also going to gift us$35 ,000 for a down payment. We just kind of feel like right now we're wasting money renting, and I know you're totally against doing this before marriage, but it just kind of feels like the smartest option right now.

22:24Dave Ramsey:How long have you been living together?

22:27Rachel Cruze:We've been living together for one year.

22:29Dave Ramsey:Why don't you get married?

22:32Rachel Cruze:so if it was up to me i would have got married last year um she is going to be competing in the 2028 olympics so we want to make sure that she's ready to go for that and she is how does marriage negatively affect competing in the olympics just the whole wedding and and planning for all that she just wants to stay focused on so the wedding affects it but not marriage yeah you're willing to buy a house which is a big deal but we're not willing to do a wedding

23:04Dave Ramsey:it's too stressful to do a wedding but it's not too stressful to buy a house

23:10Rachel Cruze:it's inconsistent the wedding's going to be a fun big party that we could uh all enjoy together you ever bought a house

23:19Dave Ramsey:no it ain't it ain't an easy process they're they're gonna do a yeah okay um so kevin you guys are gonna do what you're gonna do and um i'm not sure why you called us because you knew what exactly what we were going to tell you and um it is absolutely relationally, legally, financially stupid to buy a house with someone you're not married to. Her father willing to give her shacked up boyfriend$35 ,000 and have no protection on where that money's going to go is idiotic. That's just dumb. Okay. No way he should do that because here's what could happen, okay? Both your names are on the deeds, and you decide, I'm leaving because I don't like Olympians, and I'm going to go do something else with my life.

24:22Dave Ramsey:Now, she's got the whole thing, but he can't get his money or her money out of this thing because they can't even find you. These are the calls we get on the show. But that's never going to happen in your case. Yes, it is. Crazy people do crazy stuff all the time. It's how I, it's why we have a show and it's compelling radio. You know, it's compelling calls. So please don't do this. So what would I tell you to do if I were your friend and I am your friend, even though I'm fussing at you? Because I don't want you to do this for your own sake. I don't want you to be one of those callers that has a horrible situation and you have to call me back and try to unweave some barrel of fish hooks you got yourself into.

25:06Dave Ramsey:And so what I would do is I would call the preacher and I'd go get married Saturday. And I'd have a party after the Olympics.

25:18Dave Ramsey:And then you're legally and relationally and financially on the same page committed to. Then if you want to talk about buying a house and then if her dad wants to give you all a wedding gift of$35 ,000 to help you on a down payment, I'm in. Let's talk about whether you're out of debt. Let's talk about whether you have your emergency fund in place. But conceptually, then, I would go ahead. But if you're unwilling to commit to marriage, you should not be buying a home together. These are permanent decisions that are not easily undone. So, yeah, period. Period. and it's not and it's not the data tells us that your likelihood of having one-fourth of the net worth that you have that your friends that are married have when you're 35 35 year old men that are married have four times the net worth of 35 year old men that are shacked up that's the data and that's where this is going because if it if there's there's always an excuse there's always an excuse but we're gonna go ahead and buy a house now i think you're probably gonna buy the house i don't think you're gonna listen to dad gum thing i said but um but i wish you would really consider and i wish you'd play this back for her dad where i called him an idiot because this is just dumb he's he's just he's trying to do a nice thing for his daughter and he thinks you're a good guy and he's trying to be a good dude and he hasn't thought through the unintended consequences of this, which is this crap only works when everything goes right.

26:54Dave Ramsey:If anything goes wrong, she's screwed in this scenario. And you don't, she don't want to be in that. And you don't want to love, you want to love her better than that. So we're going to see the preacher Saturday. Saturday.

27:12Rachel Cruze:Saturday.

27:14Dave Ramsey:This Saturday.

27:15Rachel Cruze:That's your Southern uncle, Kevin. That's your Uncle Dave coming out.

27:18Dave Ramsey:Uncle Dave loving you because I don't want to talk to you when you're 30 and you've had this, all this struggle in your life because you've got things out of order. Yeah. And it screws up everything. And the number of people we call that we get in here in your situation, and you knew this before you called me. So you walked into the bear's den and said, Hey bear, will you eat? Yes, we will. So we love you so much. We're always going to tell you the truth and forcefully to try to get you to do it. So I want you to win, honey. And, man, obviously the girl's a great girl. I mean, I'm an Olympic champion.

27:53Dave Ramsey:Wow. I mean, you get to compete in the Olympics. You've got some serious stuff going on. That's neat. So this is a great find. You probably ought to, like, make sure this gets wrapped up before she slips away.

28:04Rachel Cruze:I was going to say, or she goes to the Olympics and sees an Olympic man. Not that you aren't, Kevin. But listen.

28:11Dave Ramsey:No, she said she's the one wanting to put it off. But she's tying it to the wedding. I know. And the stress of doing the wedding. Yeah. Yeah. But buying a home is stressful. Selecting a home is stressful, too.

28:19Rachel Cruze:But the quality of your life, the quality of your relationships, when you have commitment together, when you know it's going to happen anyways, and you start creating a life together, there starts to be balance, give and take. You know, all of it. It just there is. Like, there's so much data coming out that it is. There is an advantage to it, to being married. And you add the finances on top and doing something like purchasing a home together.

28:40Dave Ramsey:I mean, by the time you get to 50 years old, folks, the numbers are staggering. You ladies, you have 14 times less net worth when you're 50 years old if you've shacked up than a married friend of yours. 14 times less money. That's the reality. Men is five times less money at 50 years old. Married men long term live seven or eight years longer than unmarried men. Now, John Deloney and I were discussing that piece of research. He's convinced it's because our wives keep us from doing stupid things that kill us. Yes.

29:20Rachel Cruze:Yes.

29:21Dave Ramsey:Are you going to eat that?

29:22Rachel Cruze:We are the logical people. Are you going to eat that?

29:25Dave Ramsey:Are you going to wear that? David. David.

29:27Rachel Cruze:David.

29:28Dave Ramsey:Yeah. Passive aggressive questions coming from a Southern bill. There you go. Yeah. Yeah. I'm convinced this is real.

29:34Rachel Cruze:Well, and. Ladies live longer, too.

29:36Dave Ramsey:You have a 20 % higher possibility of surviving a cancer diagnosis if you're married.

29:41Rachel Cruze:And the stats on, what is it? Is it fulfillment or happiness within the marriage? Yes, happiness. Before living together, before marriage even. Yep. So the whole generation shift has been we live together first, and actually the data is coming out against that. On a happiness. Versus like playing house together, like we are married and we're not, because from the psychological perspective of the deep commitment that you have for protection. And that's Arthur Brooks, the happiness professor. All of that. I mean, yes, it's all wrapped in together. And again, it's not what the culture is doing. I know it's not the norm, but that's what's coming out.

30:15Dave Ramsey:Here's a good idea, too. More people live together now that aren't married than live together that aren't married in America. For the first time ever. That happened about 10 years ago, the shift is. So more people are shacking up. So I'm pissing a whole bunch of you off right now. But more people are shacking up than are married today. But here's the thing you've got to keep in mind, okay? Divorce rates at an all-time high. And if that's the case, then the splits that aren't divorced are at an all-time high. We know those things are there. So what you've got to figure out is what do most people do in a world where very few people are successful at any area of their lives?

30:56Dave Ramsey:And figure out what normal is and run from normal. Normal sucks. You don't want to be normal.

31:09Thank you.

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32:59Dave Ramsey:Guys, I wish we could get to every single call. Not every single call wishes it, but we wish we could get to every single call. And we can't because the lines are full right now and they pretty much stay that way. You can get in if you try, but if you can't, let me give you another idea. Go over to our website and use Ask Ramsey. Ask Ramsey is our free AI tool that's built and trained only. The only data in it is proven Ramsey principles. So three, four years worth of phone calls from this show, dumped into it. The books we've written, dumped into it. The articles are all over the Ramsey Solutions website, dumped into it.

33:39Dave Ramsey:So if you want a Ramsey answer to your question, that's the only thing that's in this. There's no other answers in it, which means the answers are all right.

33:47Rachel Cruze:And what's fun is you can build out a profile so it will remember you as you come back in your situation and everything. Like, it's amazing.

33:55Dave Ramsey:Yeah, I'm real proud of our tech team building this out. This is a good use of the AI technology. So you get an answer the same way you'd get right here on the show. You can ask your question. It will remember you and update you as you go down your journey, and it'll walk with you. It's pretty cool. It's called Ask Ramsey. It's completely free. Ask your question at RamseySolutions.com. Or if you're on a YouTube or you're podcasting, just click the link in the description. and it'll take you right there. Jennifer's in Daytona. Hi, Jennifer. How are you?

34:30Rachel Cruze:I would like to say it's better than I deserve. Cool. Very fun. But that's your line.

34:34Dave Ramsey:Right on brand. How can we help?

34:38Rachel Cruze:Okay. So long story short, I'm trying to figure out if we should refinance my private student loan. So me and my husband kind of discovered you and your whole program and baby steps and all that about a year and a half ago. and um so i'm a full-time teacher so i teach in high school um so it's 40 hours but 40 hours means 50 and and then um so i started working in a restaurant um and then i started a baking business like i could spend more time with my daughter and make an income and then from that my baking stuff um i started putting on um a wedding show which is making a lot more money which is great um but because i made all this income um more my husband works about 50 60 hours to, so probably more 60, because I made this more income.

35:27Rachel Cruze:Now my government student loans are going up about$700 a month. And I'm starting to have some weird health issues. So where, like, if there's any medication I want me to try, my insurance that I pay $1 ,200 a month for is denying the coverage of that medication. So I might have to start paying it. I just changed my entire diet to see if that helps versus paying for this medication, which is like$500 a month, they said. So I've changed my entire diet so that way I could save the money.

35:56Dave Ramsey:Okay. So wait a minute. How much student loan debt do you have?

36:00Rachel Cruze:So government student loans, I'm in the, and I know you're going to roll your eyes on this one, but I'm in that like a public service. What is the balance on your government student loans? So the government student loans is about$80 ,000.

36:13Dave Ramsey:Okay. And the balance on your private student loans?

36:15Rachel Cruze:About$17 ,000.

36:17Dave Ramsey:Okay. Good news. All right. Good. So$100 ,000 gets you out of student loan debt. How much other debt do you guys have, not counting your house?

36:25Rachel Cruze:We paid everything off. We paid everything off. So you're debt-free.

36:28Dave Ramsey:And what is your household income with all this activity? You guys are working like horses, man.

36:33Rachel Cruze:Oh, you have no idea. I'm so tired. And my kids kind of miss me, but I'm like, it'll be fine. We'll make it work. So it's probably around 130, give or take.

36:48Dave Ramsey:Okay. The first rule is we need to find out exactly what our income is, and we need to have a detailed plan of where every dollar of that income is going on the Every Dollar Budgeting app, okay?

36:59Rachel Cruze:Okay.

37:00Dave Ramsey:And that will make you feel like you got a raise. because part of this chaos that is your life right now is the finances are very disorganized and they're kind of floating around as separate numbers in your head instead of sitting in a line.

37:19Rachel Cruze:Yeah. And that adds stress. We don't have a set paycheck. My husband obviously depends on his hours too and the extra shifts I can pick up at a restaurant and things like that. I understand. So my salary is a big deal.

37:32Dave Ramsey:You've got all these wonderful things going on that are side hustles, but we still need a detailed game plan of exactly where every dollar comes in. As it comes in, sometimes it's going to be more, sometimes it's going to be less, but we need a detailed game plan, and you and him need to be agreed. I'm telling you, your stress level will go down. Your fatigue level will go down because you don't mind working if you can see the traction, if you can see the progression. Like if you look up and you go, we just paid off$20 ,000 in student loan debt, and our private student loans are gone. See, then I'm not as tired.

38:04Rachel Cruze:And you've been on this for a year and a half, Jennifer, you said. How much debt have you guys paid off so far? Almost$100 ,000. Oh, good.

38:11Dave Ramsey:So like in a year, in another year, you'll be debt free.

38:16Rachel Cruze:I'm kind of hoping. No, no, no, no, no.

38:18Dave Ramsey:That's a math thing. It's not a hope thing.

38:20Rachel Cruze:Yeah.

38:21Dave Ramsey:If you already paid off$100 ,000 in a year, you could pay off$100 ,000 in another year.

38:25Rachel Cruze:18 months, a year and a half.

38:26Dave Ramsey:Okay.

38:26Rachel Cruze:They make$130 ,000. They have$100 ,000. Yeah.

38:30Dave Ramsey:Yeah.

38:30Rachel Cruze:So it'll be a year and a half. But, Jennifer, to the point that you can still budget with an inconsistent income, you guys just every month kind of guess and just say, okay, here's what we think we're going to make. And when the 15th hits and it's a little bit less, you just lower that income, which means you already have planned out which categories you're going to lower or what's going to be cut out of the budget for the remaining part of the month.

38:48Dave Ramsey:Well, we're not putting as much on the student loan is all it is.

38:52Rachel Cruze:Fair, fair, fair.

38:53Dave Ramsey:All you're going to be doing is putting everything on the student loan and how much you make up or down is going to be more on the student loan or less on the student loan that month. That's all it is. That's the only variable in this.

39:02Rachel Cruze:But it helps you stay within the margin of your food budget, your out-to-eat.

39:07Dave Ramsey:Yep.

39:08Rachel Cruze:I mean, all the extra stuff that just ends up kind of slipping away that can add up to a couple hundred bucks a month, which makes a dent in this debt over, you know what I mean, over a period of time. Okay. But it is that kind of strict budget. But you guys have been doing it.

39:20Dave Ramsey:I mean, you've done a great job. If you only have the student loans debt, debts left, and we're on an 18-month schedule to pay them off, you're paying way more than minimums anyway. So whoop-dee-doop-dee, it went up. Okay.

39:36Rachel Cruze:You said something, Jennifer, as you were saying the$80 ,000, and you're like, you're going to hate this, but you're on the –

39:42Dave Ramsey:She's on the income repayment.

39:45Rachel Cruze:Yeah, and they said like after 10 years, I'm on like year 7 of it. No, you're not. I wouldn't do that.

39:49Dave Ramsey:I would just get it paid off. Let's just get it paid off, yeah. because you can't count on them. They lie. It's the federal government. And like 1.7 % of the people that do the 10-year repayment plan so far have actually gotten forgiveness. It's nobody gets it because it's so screwed up and bureaucratic and messed up that I'm going to be the one. Yeah, no, you're not. Don't do it. Just get it paid off. You're working like crazy people. Because think about where you'll be two years from today when you don't have a payment in the world except your house. Wow.

40:24Rachel Cruze:That would be fun.

40:26Dave Ramsey:I'm telling you, all this other medical stuff you're facing will be affected by your stress level and your anxiety level and when there's all this chaos and lack of organization and when the weight of the$100 ,000 is not there anymore. All of that's going to affect. It does affect health. It does with everyone, by the way.

40:48Rachel Cruze:And well done, you guys, though.

40:50Dave Ramsey:Yeah, you're doing great.

40:52Rachel Cruze:You're killing it.

40:53Dave Ramsey:You're doing real good. And in our millionaire study, teachers are on the list of the five careers of Baby Steps Millionaires, Jennifer.

41:02Rachel Cruze:So you guys are in great professions. You have got a great head on your shoulder. Just dial in the budget, and I promise you'll be finding some more cash when you do that. Yeah. Wow.

41:12Dave Ramsey:That's powerful. And she's not lacking in energy. No. She can work.

41:17Rachel Cruze:She's got a lot of energy, Jennifer.

41:19Dave Ramsey:She's highly caffeinated, yeah.

41:20Rachel Cruze:Keep at it, Jennifer. We need that good spirit.

41:23Dave Ramsey:I like it. I like it. I like her. She's neat. So way to go, kiddo. Push on through and get this stuff out of your life. But the best way to do it, the most efficient use of money is a detailed plan. And one of the things, folks, if you think about it this way, if you worked for a company called You Incorporated and your job at You Incorporated was to manage money for You Incorporated and You Managed Money for You Incorporated the way You Managed Money for You now, would you fire you? and if the answer is yes then probably you ought to change something and don't be sitting around shocked that you're broke if you're doing a bad job handling the money and so you know like i've got 14 profit centers here at ramsey i just met with one of them a while ago for an hour and a half going over their detailed budget and the vice president of that area is showing me with smart vester we were looking at smart vester stuff or he's showing me exactly what we've got coming in exactly what we got going out we're going in over the details and you know we have But believe me, he has a stinking budget.

42:16Dave Ramsey:And believe me, it's organized. And believe me, he executes because it's his freaking job. Hello. And get to keep that job is how he does it. Hello. So he's really good at it.

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43:44Rachel Cruze:NMLSconsumerexcess.org, equal housing lender. 1749 Mallory Lane, Suite 100, Brentwood, Tennessee, 37027.

43:58Dave Ramsey:Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. Rachel Cruz, Ramsey personality. My daughter is my co-host today. Open phones at 888-825-5225. Emily is in Raleigh, North Carolina. Hi, Emily. How are you?

44:14Rachel Cruze:Hey, Dave. Hey, Rachel. I'm doing good. How are you guys?

44:17Dave Ramsey:Better than we deserve. What's up?

44:20Rachel Cruze:My question for you is, I've been with my boyfriend for four years now, and we're at a fork in the road where we had a conversation yesterday, and he gave me a list of things I need to work on to earn an engagement should I leave what I know the answer wait what how old are you I'm 31 he's 38 we've both been married yeah can I ask not to be like overly vulnerable Emily be like what's on the list two things I struggle with change and adversity

44:59Dave Ramsey:you struggle with change and you struggle with adversity with dealing with adversity and you have to fix both of those to earn his hand it's not something he wants to come home

45:13Rachel Cruze:to every day for the rest of his life what wow that do you feel like you have that attitude while y 'all are dating? Like, has there been conversations and he's like, you see the glass half empty. I need someone with the glass half full. Like, what have the conversations been before this list was created? It was a, I asked a question back. Has it, have you always felt this way? He said, no, it's just been this last year. And I asked him, well, we've gone through a lot of challenges and adversity this last year. It's probably been the most challenging year we've had.

45:55Dave Ramsey:So what kind of adversity did you face that you weren't good at?

46:00Rachel Cruze:According to him. I have changed my career and moved to, I've moved out of state three times in the last year to stay in this relationship, and I'm being asked to do it again, and I don't want to do it without a commitment.

46:15Dave Ramsey:And so the adversity is you've had all of these moves, and you're sick of it, and that That means, according to him, you're not good at adversity.

46:27Rachel Cruze:Yeah, and my response is if things can stabilize for more than one year, then I will be able to be content again.

46:36Dave Ramsey:Why does he move every year?

46:40Rachel Cruze:We're ambitious people, promotions. We decided to open a franchise, which is why we moved, and it didn't work out. So there's been some financial hardship along the way. That has caused more stress. So that's essentially what's been the most recent adversity we've gone through. And we're about to go through it again. So I'm a little nervous. I feel like I have to watch myself if I decide to move forward again.

47:10Dave Ramsey:Sharon and I moved out of a home that we had had for 15 years that we built, custom-made, beautiful home. and in 21 when people were paying more for properties than they should have someone paid us more for that than they should have and so we sold it and we were homeless and we went and bought a house and we moved um those were decisions we made together and um there was always stress associated with the move uh but i don't think either one of us would call that adversity That was we decided to change our location together, and together we changed our location. And whatever drama there was was outside of our house that was she and I facing that drama, not like I'm weak and I can't handle the change and you're strong and you can.

48:04Dave Ramsey:We didn't have that discussion because we both decided and did it together. So I'm a little bit confused coming from that point of view as to how moving is actually adversity.

48:15Rachel Cruze:Well, she said she followed him around. She had to move three different times to stay in the relationship. So he's asking her to move with him. And she's like, I don't want to move again.

48:24Dave Ramsey:I got that part, but I don't even think this – I think adversity is the wrong word.

48:28Rachel Cruze:I think that – okay, it could be the wrong word. But I think it's stressful. I think her following him and then having to, quote, unquote, put on a brave face and you can't even authentically be yourself when you are stressed.

48:39Dave Ramsey:Adversity is you have a having to move. You have a cancer diagnosis. Adversity is someone in your family has a sickness or an illness. Adversity is you got fired from a job that was not your decision. Well, their franchise failed. That's it. A failed business is an adversity. But moving cities to take a better job and choosing to do that with your boyfriend is not adversity. It is change. It's dramatic change.

49:09Rachel Cruze:And you could hate that, though.

49:10Dave Ramsey:Yeah, and I'm good with hating it. I'm just curious. It's a curious word choice for me.

49:15Rachel Cruze:On his part.

49:16Dave Ramsey:Yeah. Or on yours to adopt it, either one. But interesting. Interesting. Yeah. So I think this doesn't come down to your deficit and he's got it all together. I think it comes down to you're sick of following this guy around.

49:32Rachel Cruze:Yep. I don't get anything out of it a year ago. And he knows it.

49:37Dave Ramsey:He knows you're sick of it, and he wants you to not be sick of it. And you're sick of it.

49:43Rachel Cruze:Yeah, I feel like it's a too bad, so sad, oh well kind of response.

49:46Dave Ramsey:Yeah, yeah.

49:48Rachel Cruze:And it's just a fork in the road in my life. Yeah. So I listen to you guys every day. And that's heartbreaking, Emily. I'm sorry. You've been with them for four years, right? That's hard.

49:59Dave Ramsey:The truth is just listening to you. I mean, you're not an immature little girl. You're a grown woman that's got strong intellect and you're articulate. And so I think when he said this, you've already made up your mind. You just wanted to hear us say it too, that it's weird. So I'll say it's weird. That's a weird request. if you had a daughter and her 18 year old boyfriend said you have to do these three things to get married to me you would tell your daughter run i'd be like here's here's my list

50:31Rachel Cruze:for you yeah chad you need to change these things head out the door bubba chad yeah let's change your commitment issues chad yeah man yeah i've been following your butt around and all you got

50:43Dave Ramsey:for the return for that's criticism so yeah i think you already made your decision for you called us, but it's just, you hadn't, hadn't said it out loud. And now you did.

50:57Rachel Cruze:Yeah.

50:58Dave Ramsey:I'm sorry. It hurts.

50:59Rachel Cruze:I appreciate it. You know, it's just, uh, talking to like-minded people, getting their opinion on it. Yeah. Well, and here's the truth to Emily. You want a partner, you want a spouse in your life. If you choose to get married to him, that you can come home and be who you need to be at home. And again, you don't, I mean, and I get that like some people complain in marriage, like so-and-so complains all the time, but there's a level of authenticity of like, I need to just like unload right now. Like I'm so stressed and I need you to partner with me in that and hear that in me and empathize and ask questions, be curious, like do this life with me, not that I have to image manage in front of my spouse.

51:34Rachel Cruze:Do you know what I mean? Like that's, that's going to be an exhausting life.

51:36Dave Ramsey:Yeah. I have to do this to earn.

51:38Rachel Cruze:Yes.

51:39Dave Ramsey:This is a conditional love versus unconditional love.

51:41Rachel Cruze:Yeah. And we're getting your side of the story and I'll say more and more now we're, uh, we get dms from the person on the other side of the story you know what i mean and you and you hear so i

51:52Dave Ramsey:let me tell you you can dm if you want to dm but you did leave your girlfriend of four years who followed you in three different cities feeling this way even if even if you didn't say it that way you left her feeling like you said it that way so you still screwed up emily i'm sorry yeah sorry that's awful people do like change by the way when it's changed for the better they love it you ever bought a new car it's exciting and fun it's change

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54:05Dave Ramsey:If you're working the baby steps, the best and fastest way to do it is by using every dollar. It's more than just a budgeting app. It is the Ramsey plan built right in. You track your progress. You get personalized recommendations and coaching for your situation that will help you free up more money, work the plan faster, get out of debt faster, become wealthy faster. It's like having one of us walk with you every single day, showing you the next right step and holding you accountable. Start the every dollar process for free by downloading the app in the App Store or Google Play. Thomas is in Phoenix.

54:41Dave Ramsey:Hi, Thomas. How are you?

54:43Rachel Cruze:Hi, Dave. I'm doing well.

54:45Dave Ramsey:Good. How can we help?

54:47Rachel Cruze:So I have just finished baby step two, and I'm 52 years old. And so I'm doing steps three and four right now. And I just wanted some guidance on whether I should do, focus more on investing or paying down my mortgage once I get three accomplished.

55:09Dave Ramsey:Okay.

55:09Rachel Cruze:And I got numbers.

55:10Dave Ramsey:All right, cool. We teach to do Baby Steps 1 through 3, which is$1 ,000 saved, then out of debt, everything but the house, and then 3 is a fully funded emergency fund with great focused intensity. One of those things at a time until it's accomplished. So you should not be doing anything on 4 until 3 is done. And you probably can do that in just a month or two or maybe 10 minutes. I don't know. But call Baby Step 3 completed. then we change from scorched earth intensity like running for your life intensity to intentional and we relax just a little bit okay and this is when you could upgrade a car or do some other you know go on a trip or something like that but until then till you get past baby step three you don't need to be eating out you don't need to be buying cars you don't be doing nothing Okay.

56:01Dave Ramsey:So once you're there, then baby steps four, five, and six we do simultaneously, which is kind of what you're trying to do right now on three and four. And that's 15 % of your household income going into retirement. And if you have kids' college to deal with, that's baby step five. And then any other money beyond 15 % of your income being saved would go on the house mortgage. And so we're running baby steps four and six simultaneously. But it's very simple. You put 15 % away, and every other dollar you can find that you don't need to use to have a good life, you can throw at the debt. And what typically happens is people are paying off their homes using that system in between 7 and 10 years.

56:50Dave Ramsey:So let's look at your numbers. What's your household income?

56:56Rachel Cruze:So I'm a Fed, and I make$55 ,471 a year, and I have a VA compensation, which is$21 ,701 a year.

57:07Dave Ramsey:Okay, so you have$76 ,000 income. Thank you for your service.

57:13Dave Ramsey:And you owe what on your home?

57:19Rachel Cruze:$191 ,000.

57:21Dave Ramsey:And you said you're 55 years old? 52 years old that's right okay all right so cool so what we would prescribe is you get your emergency fund finished and then you're putting 15 of your income away it's about ten thousand dollars a year about 800 bucks a month and um if you're working for the fed you could you can you could you could put it um in the thrift savings plan the tsp or and or you could use uh just a roth ira and good mutual funds and that'll take care of a bunch of you put 8 000 in that And that's what I would do.

57:53Rachel Cruze:Yeah, TSP has a Roth now.

57:55Dave Ramsey:Yeah, but they also don't have as good options as the open market does for mutual funds. The best option in the TSP by far is the C-Plan. It's the only thing that even mimics the market, and it's about like an S &P 500. So it's a good investment. It's not a bad investment. And so if you need to do some in the TSP, what I would do is put$8 ,000 into a Roth, getting with a SmartVestor Pro, and put$2 ,000 into the TSP. And then beyond that, if I can find any money in the budget, I'm going to start throwing it at the house. Do you have any money right now, Thomas, saved in retirement?

58:32Rachel Cruze:I've got, oh, for retirement, I got 26 in the TSP,$26 ,000. $26 ,000, okay. The caveat is there's an investment package that is being handled, and it was my dad's. And he made my stepmom the beneficiary. She doesn't touch it. She doesn't need it. And she's like, this is yours when I die.

58:57Dave Ramsey:That's good news. And I have no idea how much it is.

58:58Rachel Cruze:You don't know how much it is?

59:00Dave Ramsey:I don't feel comfortable asking. I would plan like that doesn't exist. Yeah.

59:05Rachel Cruze:So if you did the numbers, I just typed in the calculator real quick, Thomas, with your$26 ,000 that you have, and you put$800 away, between now and$67 ,000, you'll have$565 ,000.

59:16Dave Ramsey:And you've got your military retirement at$21 ,000.

59:19Rachel Cruze:Yep. Yeah, yeah. I came up with the same numbers when I used your calculator, which doesn't include the Fed contribution. Right. So good. And whatever's going to happen. Oh, wait a minute.

59:31Dave Ramsey:Fed's contributing to your TSP? 5%. Is that a match? Yeah. Okay. Well, you put 5 % in the match then for sure, and the other 10 % you could put in a Roth IRA. So match in the C plan, TSP Roth, and then Roth and a good growth stock mutual funds. And with your SmartVestor Pro that you can contact at RamseySolutions.com. And, yeah, you're going to have half a million to a million dollars, you know, by the time you need some money. And you're doing really good. I'm glad.

1:00:03Rachel Cruze:Well done, Thomas. Well done.

1:00:04Dave Ramsey:And you've got$21 ,000 a year coming in as long as you're alive. Military retirement, which is excellent. So very cool. And the house will get paid for using this system. But, no, I would not put more or less in retirement. I would work that exact plan. That exact plan.

1:00:23Rachel Cruze:And then bump it up once the house is paid off, throw in more at investments, and you can have more there at retirement. So well done, Thomas. Which is so encouraging to do all of this in your early 50s. Like he's jumping on the plan now, you know, on baby step three, starting retirement. I mean, it can be done.

1:00:40Dave Ramsey:Yeah.

1:00:40Rachel Cruze:It's great.

1:00:41Dave Ramsey:Ever since we started doing this, we've had people in their 50s and 60s and 70s ask, you know, is it too late? Well, not if you're breathing. You still got a shot, you know? So, you know, just keep sucking wind and working on it, right? It's not too late. That's the idea. So you can do a lot of stuff in a few years, but is it easier if you start earlier? Yeah. For you 21-year-olds,$100 a month and you're a millionaire in no time, man. I mean, just shut up. Hello. That's way different than saving$800 a month to end up with a half million.

1:01:16Rachel Cruze:That's right.

1:01:16Dave Ramsey:You know, so, yeah, get that compound interest, the eighth wonder of the world, according to Einstein, working in your favor, right? And it is, if you run compound interest numbers, it will blow your freaking mind how powerful that is. All right, Ted is with us in Nashville. Hi, Ted. How are you?

1:01:34Rachel Cruze:Howdy. I'm well. How are you guys doing?

1:01:35Dave Ramsey:Better than we deserve. What's up?

1:01:38Rachel Cruze:Wonderful. My wife's 31. I'm 36. We're on four, five, and six. um we owe about 328 000 on a house that's worth about 550 000 we have about 300 000 saved currently for retirement way to go i'm about i'm about six years away from being eligible from uh collecting my pension and retiring from the military i'm in the blended retirement system ah and i was doing i was reading some of the literature recently and i hadn't realized that i have an option to take a reduced pension at either a 25 % reduction or 50 % reduction in exchange for the lump sum. Do it. And I got on Ask Ramsey last night. Yeah, and Ask Ramsey, I was very helpful.

1:02:21Rachel Cruze:I ran a couple of models, and it all looks like a good idea. I mostly wanted help deciding if I'm missing something, figuring out what exactly I want to do with the lump sum.

1:02:30Dave Ramsey:No, you roll the lump sum into an IRA, so there's no taxes on it that way. And you leave it alone, and you let the lump sum grow because the lump sum will grow and feed you more than the pension would have fed you because the mutual funds are growing at a greater rate than the pension is.

1:02:46Rachel Cruze:Yeah, it's not even close.

1:02:48Dave Ramsey:Yeah, and when you die, the pension dies with you and lump sums don't die with you. So you end up with a half million or a million dollars as a result of this over in your inheritance versus when you die, your pension just goes poof.

1:03:02Rachel Cruze:Yeah, the model that I ran, I'd be giving up$480 ,000 of future pension payments. And if I invested that all would grow to about 3.2 over the same time period.

1:03:12Dave Ramsey:You did it correctly. That's why we tell you to do it. That's exactly it. No, you didn't miss a thing. That's how smart it is. It's not just a little bit smart. It's like way smart.

1:03:34Thank you.

1:03:59Rachel Cruze:Dave, we got a lot of calls on this show where life happens.

1:04:02Dave Ramsey:One day someone's healthy, they're working, providing for their family, and then a curveball hits. You know, we hear it all the time. A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes.

1:04:15Rachel Cruze:Yeah, and that's why you've always said that having term life insurance from Xander is essential because it protects your family if the worst happens.

1:04:22Dave Ramsey:Yeah, that's right. You need 10 to 12 times your income in coverage. No gimmicks, no whole life junk, just straightforward term life protection. But there's another piece that people often overlook, and that's long-term disability insurance.

1:04:38Rachel Cruze:Yeah, it's important to understand the difference between them. Life insurance steps in when you die. Disability insurance steps in while you're alive but can't work. So it replaces a large part of your income so the bills still get paid while you get back on your feet.

1:04:52Dave Ramsey:Now, if your employer gives you free disability insurance, great, take it. If it's discounted there at a better price, take it. But if not, Xander can help you find the right plan. Whether you're single or married, it's not optional. If you're going to be out of work for a while, then you need to make sure the money's still showing up. And that's why Xander is our go-to. They make it super simple to get the right coverage at the best price, no pressure, no upselling. I've trusted Jeff Xander and Xander Insurance for over 25 years, and so has my family.

1:05:23Rachel Cruze:So don't wait. It's fast, it's easy, and it could make all the difference.

1:05:26Dave Ramsey:Go to Zander.com or call 800-356-4282. Protect yourself, protect your income, protect your family.

1:05:54Dave Ramsey:Ethan is in Atlanta. Hi, Ethan. How are you? Good. How are you? Better than I deserve. How can I help?

1:06:01Rachel Cruze:Hey, so I'm going over my mom's finances with her. She's 55 years old, has only$19 ,000 in retirement, and a ton of consumer credit debt, and a HELOC loan. And I built her a spreadsheet just to get everything out in front of her so that she could see what her finances look like. and I was trying to teach her the debt snowball method. She's got about$200 that she could start throwing at consumer credit debt, but I was wondering if there's a quicker way that we could get her, I say we, my little brother and I, we're trying to get her positioned better financially before she kind of hits that retirement age.

1:06:46Dave Ramsey:That's very neat. And she's accepting your coaching. That's interesting. Yeah. Well, hesitantly, but yes. I heard it. Nice, Ethan. How old are you?

1:07:00Rachel Cruze:I'm 27. My little brother's 24, and we're just trying to be right by our mom and take care of it. I'm a mechanical engineer. I work on elevators.

1:07:08Dave Ramsey:Ah, okay. So you're a detail guy. Yes, I love spreadsheets. Yeah, you love spreadsheets. Yeah, I can tell. And you're a good son. You're really helping her. That's awesome. And I appreciate that you're guiding her on that. What is her income?

1:07:25Rachel Cruze:So she makes$20 an hour. So after taxes, her take-home is roughly, she nets$2 ,500, but her monthly gross is$3 ,400. So about$41 ,000 a year.

1:07:40Dave Ramsey:What does she do for a living? She's a custodian at Alden County. And where's your dad? Alden County.

1:07:48Rachel Cruze:My dad's kind of out of the picture. He's off doing his own thing.

1:07:53Dave Ramsey:They're divorced? Just doesn't really contribute. They are separated, yes. They're divorced. Are they separated or are they divorced? They're divorced. Okay. All right. Because that'll matter in her future. How long have they been split up?

1:08:10Rachel Cruze:I think they're coming up on like 11 years being divorced.

1:08:14Dave Ramsey:Okay. Good. All right.

1:08:17Rachel Cruze:So how much credit card debt is there? So minus the HELOC loan, about$16 ,000. Okay. And is she using credit cards to get by monthly that$3 ,400 isn't covering her expenses, or is it just kind of flip its spending that's caused it? So it's kind of a messy situation. She right now is living off of just her paycheck. I made sure that she, like when I talked to her, she's just using her debit card to pay off all of her debts. So she's not using her credit cards at all. I was in Palm Beach a while back where Mar-a-Lago is, among others.

1:08:59Dave Ramsey:And about three doors down from Mar-a-Lago is a property that is probably a couple hundred million dollars in value. And the lady that lives there was Mary Kay of Mary Kay Cosmetics. She built that house. You've heard of her, I'm sure. Yeah. Okay. She got divorced at 55 years old and started from nothing and decided, I don't want to be broke anymore. So she started her whole life, her encore, her whole career, everything started at your mom's age.

1:09:34Rachel Cruze:And so I want that for your mom.

1:09:40Dave Ramsey:I don't know if I want her to be in a$200 million house next to Mar-a-Lago, but anyway, but I want a second chapter beyond the 11-year-ago divorce, beyond being a custodian, because she didn't sign up for the trip she's on, and I want her to sign up for a new trip. So I'm going to ask her, as her 65-year-old older brother, what she's going to do in her encore career. What's the next chapter of your life look like, honey? What do you want to be when you grow up? Because now at 55, you get a second chance. You've got 40 years, 30 years of income potential. And I don't want you, there's nothing shameful about being a custodian making$20.

1:10:28Dave Ramsey:But part of her problem is she's a custodian making$20. and the life that she's settled in on, she'll still be doing that 25 years from now if she doesn't have some kind of a wake-up call. You follow me? Yes. And that's a bigger concern than a little bit of credit card debt.

1:10:47Rachel Cruze:I agree.

1:10:48Dave Ramsey:So I'm going to put a bunch of inspirational literature around her. Make sure she has friends that are inspiring her. Charlie Tremendous Jones said five years from today you'll be the same person you are today except for the books you read and the people you meet. So I want her to meet some new people because you become who you hang around with. I want her to read some new books. I want her to get her nose back in her Bible and her tail end back in church. And I want her to get fired up and wired up about who she's going to be in this next chapter. And I want her making$45 an hour, 48 months from today.

1:11:24Dave Ramsey:This is the kind of way I want to think about this for her. I want her to have a better life than she's got lined out right now. Then, obviously, the byproduct of that is it solves your problem that you're facing. Because part of what you're facing is you're taking very little income and trying to squeeze a lot out of it. That's what your spreadsheet told you, right? Yes. Yeah. So part of what you got is a huge income problem. But the reason you have an income problem is you've got a perception problem. and the dreams died on the first go-round and we need a new set of dreams. So that's, yeah, I want Mary Kay story for her.

1:12:08Rachel Cruze:I want that too. I was wondering what your thoughts on this were. If she only has about$19 ,000 in retirement due to the way the company that she's worked for has structured it, it's really messed up. what if she were to take that$19 ,000 out of the 401k and obviously has to pay taxes on it and just knocks out all of her consumer debt and then she's left with only the$34 ,000 having to pay off that HELOC and then that would make her cash flow about$1 ,300 a month. Yeah.

1:12:45Dave Ramsey:If we don't do the other thing I was talking about, it won't matter. Right. Because she's going to struggle. to make ends meet at 20 bucks an hour. That's below the poverty level. She's going to struggle. Okay. Yeah. And it's going to get harder and harder and harder as she ages because it's hard to be a custodian when you're 70. So, yeah, your feet hurt. Hello, your back hurts. Hello.

1:13:14Rachel Cruze:Yeah, and I wonder, even Ken's book, we could give her a copy of that because there's a great –

1:13:20Dave Ramsey:Finding the work you're wired to do.

1:13:21Rachel Cruze:Yeah, because there's a great assessment in the back just to start jogging her memory of what she enjoys, right? You find what you're good at, her natural bent. That may have been squashed for years. I mean, who knows, right? But just to get some ideas. Yeah, the divorce definitely did a number of things. Oh, sure. Yes. It steals your dreams. I want to encourage her with this because when I showed her the spreadsheet, it deflated every kind of belief she had because she wasn't snowballing. She was paying extra.

1:13:46Dave Ramsey:Yeah. So I know I would not cash out their retirement because I don't want her to have to pay the 10 % penalty plus her taxes on the retirement. I would stop adding anything to retirement, and I would lean in and pick up extra jobs and start taking classes and do whatever we want to do for this next chapter. And then begin clearing the debt that way. But if we waived a wand and she had no debt, including her HELOC, and she's at$20 an hour at 55 years old, and she has no hope of that changing much except for a little bit of a cost of living raise every so often, and it goes from$20 to$20.45 or whatever, right?

1:14:24Dave Ramsey:That's not – we're not prescribing a prosperous future with no debt. and so there you know your spreadsheet's not going to get fixed until you put more on the top of it um but but yeah keep working on it and keep encouraging her but if i were in her shoes i would spend 80 to 90 percent of my energy dreaming again and setting up my next career and 10 percent of my energy trying to manage the mess that i'm sitting in and i'm gonna work my way out of this manure and and go on to the next thing the best revenge is success. So hang on, we'll send you a copy of Ken's book.

1:15:54Dave Ramsey:Tess is in Detroit. Hi, Tess. How are you?

1:15:57Rachel Cruze:Hi, I'm well. Well, thanks for taking my call.

1:16:00Dave Ramsey:Sure. What's up?

1:16:01Rachel Cruze:Well, my husband and I have been mulling around the idea of buying a new car. And we finally decided on one we might like. And separately, we looked it up. We're like, hey, this is pretty good. It'll fit us. And then I said, well, let's go buy it because we have cash. We can just buy it. And he said, oh, you know, they have 0 % financing. Why wouldn't we do that? And I thought, you know, I listen to the show all the time, but I don't really know. So I would say you don't do it because you don't want any debt at all. Correct. Why wouldn't you use their money? Yeah.

1:16:38Dave Ramsey:Well, hypothetically, that would cause you to have more money or build some wealth because you did that. That would be the hypothetical. In other words, I'm paying no interest and my investments are paying me. But the truth is what ends up happening is it's not going to be a problem for you. You've got plenty of money, I can tell.

1:16:58Rachel Cruze:Yeah, it would not be a problem. But you would lose money by doing that. No, you don't.

1:17:04Dave Ramsey:Here's why. Two reasons. Number one, what car is it? What's the car?

1:17:09Rachel Cruze:Well, I don't know if you like it, but we did. No, what car is it? It's a Hyundai Santa Fe that we rented when we were in California. We wouldn't have ever looked at that car, but it was a rental, and we're like, wow, this was really nice.

1:17:22Dave Ramsey:It was a rental.

1:17:23Rachel Cruze:They rented one and liked it, and now they want to buy it.

1:17:26Dave Ramsey:Oh, I see. I see.

1:17:27Rachel Cruze:Oh, it was a rental that made us decide this car. I understand. I understand.

1:17:31Dave Ramsey:Yeah, that's happened to me. Okay. Yeah. And I've also decided on some cars I would never buy after I rented them. That's right. But the Jeep Wagoneer. And the, anyway, the, yeah, whew, bad car. Um, the, uh, uh, I haven't looked at Hyundai's program, but every program I have ever looked at, the only way they give you 0 % is if you pay MSRP, you pay full price, you pay sticker. So 0 % is not really 0%. So I bought a, uh, a new, uh, Raptor Bronco the other day. Okay. Okay. It's a cute car. and I bought that car.

1:18:18Rachel Cruze:That's the adjective you use for your car. I have a cute car.

1:18:21Dave Ramsey:It is. It's cute. It's a cute. I mean, compared to my big truck, it's a cute little car. But it's brand new and I called the dealer that I work with on Ford stuff when I'm buying it. Great people. And I just buy it for a few dollars over invoice.

1:18:36Rachel Cruze:But do they do that for everybody?

1:18:38Dave Ramsey:They do that for everybody because they get manufacturer rebates and kickbacks and 14 different things and they make plenty of money on the car at invoice. So$500 over invoice,$1 ,000 over invoice, that kind of thing is fairly typical on a car like you're talking about, like I'm talking about, okay? And that's a lot less than MSRP, a lot less than it's on the sticker. So 0 % is not 0%. That's problem number one. Problem number two is I have met – we did detailed research with 10 ,000 millionaires and the number of millionaires that we interviewed that told us that they became millionaires because they use 0 % financing and you kept their money working for them was precisely zero.

1:19:17Dave Ramsey:None of them do. Millionaires just don't do this. Okay?

1:19:22Rachel Cruze:Right. I agree. I don't want a stinking car payment. New bottle.

1:19:29Dave Ramsey:Even if it's a 0%, I don't want a stinking car payment. And it's that simple. So, yeah, you win the argument. And it's an interesting discussion, but that's the two reasons. One is you're paying too much for the car, and so it's not really 0 % because you really ended up, you know, in a sense, borrowing the money at an interest rate. So and then the other thing is that real people that have real money don't do this crap. And you've got real money, and that's why you stopped and said, I don't think so, honey.

1:20:00Rachel Cruze:Yeah, and the problem is when you don't have real money and you still go into this, if you miss a payment or something goes off, sometimes they backtrack all the interest and it's an absolute disaster.

1:20:08Dave Ramsey:You can really get the terms that you have to abide by to continue to get zero percent and to get zero percent in the first place are pretty horrendous. So basically, very few people, by the time they get through all that at the dealership, end up with zero percent. And so it's a bit of a bait and switch to get you in the door and get you. Oh, we'll get you in the finance office and then we'll get your real loan. You know, and that happens a lot because you've got to have all kinds. Well, that's it. Don't do it. Michelle's in Sacramento. Hi, Michelle.

1:20:43Rachel Cruze:Hi. How are you?

1:20:44Dave Ramsey:Better than I deserve. What's up?

1:20:47Rachel Cruze:Oh, good. Okay. I just had a quick question about shared bank accounts. So my husband and I have been married for, we're going on eight years, and we have a shared bank account, and then we have a separate one through a failed business attempt, but it was a personal account. and he wants to keep that open and have my paycheck go directly to that because, okay, and so it's kind of, now I've got to think about it. We just barely got to baby step three and we are completely out of debt and we have our first month's expenses for emergency funds in there saved up and we're moving, trying to get that moved up.

1:21:36Rachel Cruze:But I just don't feel comfortable keeping that other bank account open. It felt like, you know, just separate and not together.

1:21:42Dave Ramsey:Okay, I'm confused. We are working on the baby steps, which indicates that both of you have some exposure to Ramsey, and yet he now has decided he has a better plan, and that's that we don't do anything. We separate everything and act like we're roommates.

1:22:00Rachel Cruze:Yeah, kind of. But he's still giving me access to the family account and the groceries and all of that. Well, that's nice of him. And it's not like he's very, very... Why does he want to do it, Michelle? I don't understand his why. Keep it open and put your income in that. For what, though? Oh, so he has an ex-wife, and he's nervous if something happens there. He wants to make sure that we have separate that doesn't affect the family account. Okay.

1:22:31Dave Ramsey:How can his ex-wife get into the family account? She can't.

1:22:35Rachel Cruze:I'm not sure.

1:22:36Dave Ramsey:No, she can't. Even in California, they don't allow that.

1:22:41Rachel Cruze:That's fair. Yeah. So it's just kind of a, I don't know if it's him trying to be like, he's trying to think that it's like a safety thing or a backup safety thing or whatnot. But he and I have sat down and had a conversation about it. I said, I'm not comfortable with this.

1:23:00Dave Ramsey:Yeah, like I'm not doing it.

1:23:02Rachel Cruze:Yeah. We've already been through eight years. There's nothing to be insecure about. You know mine. I know yours. And we've already gotten out of everything.

1:23:10Dave Ramsey:If you're worried about me, we've got a different issue, and it's not a separate account. If you're worried about her, you have a different issue, and it's your lack of knowledge of how the legal system works. She's gone. She's called the ex for a reason. She's a used to be.

1:23:23Rachel Cruze:I mean, they've settled everything. She was a starter wife. You guys have been married for eight years. So, so interesting. Yeah. Yeah. And there's only left of like maybe two or three. But, and that's the thing is like we're on the same page with everything else, but it's just for some reason. And he wants it to go to like, you know, this is where we pull to go for. Well, I mean, when you say, no, I'm not going to do that. And I'm not okay with that.

1:23:47Dave Ramsey:What's going to happen?

1:23:51Rachel Cruze:I don't know. I don't think it's anything. I don't know. Because to me, it makes sense to keep everything in the same spot. You're right. Is he wanting to have a separate account in general to put all of you guys together? And he's just saying, hey, I'm going to save your income over here so when we go on trips or need to buy a car, we pull out of that account? Is that what you were saying? Yeah, that's – Okay, so I would have a – Okay, so what I would do, Michelle, is I would go get our smart bundle at Fairwinds Credit Union. This is what Winston and I did. you have a checking account in there and then you can have up to 10 high yield savings accounts so we have our emergency fund in one and then you can open up another one and yeah and if you guys look at the budget and say hey we're gonna do the budget and we're gonna save some amount of money this amount of money and maybe it comes out to your paycheck and that's what y 'all agree let's put my paycheck in this high yield savings and we're that's gonna be our big bucket of savings throughout the next couple of years and we need to pull from it for yes that's what Winston and I do Do we have a high?

1:24:52Dave Ramsey:I know, but you already were putting 15 % of your income away before that. And you were already, you had a house mortgage before that. Oh, in the baby steps, yeah. She's a baby step three.

1:25:02Rachel Cruze:Okay.

1:25:03Dave Ramsey:So you should not be saving money in addition to 15 % of your income.

1:25:07Rachel Cruze:Okay, that's fair.

1:25:08Dave Ramsey:Except for miscellaneous living expenses.

1:25:10Rachel Cruze:But I am saying a different account that you guys put the amount of money maybe that's your paycheck to be saving in general later on in the baby steps, that's fine to have another account to do that.

1:25:20Dave Ramsey:But both your names are on it. And the amount that's going into it happens to be some amount. That's right. But it doesn't need to be, we need to hide your check over here in a failed business checking account. Yuck.

1:25:31Rachel Cruze:No, I'm trying to paint another picture for you, Michelle.

1:25:52Dave Ramsey:Welcome back to the Ramsey Show in the Fairwinds Credit Union studio. I'm Dave Ramsey, Rachel Cruz. Ramsey personality, my daughter, is my co-host today. Open phones at 888-825-5225. Stephen is in Tulsa. Hi, Stephen. How are you? Hey, guys. Thank you for taking my call. Sure. What's up?

1:26:16Rachel Cruze:So my brothers and I, we're working on a plan. We're trying to figure out the best and most efficient way to buy my parents out of our family business so they can retire.

1:26:26Dave Ramsey:Cool. Okay. So what is the business net profit?

1:26:32Rachel Cruze:Net a year is right around a million. Gross is – last year gross was about$8 million.

1:26:39Dave Ramsey:Okay. And what are they wanting to be paid?

1:26:44Rachel Cruze:They haven't settled on a number.

1:26:45Dave Ramsey:The company was evaluated at around$14 million. No, it's not. I wouldn't. Not even close. A million-dollar profit company is not worth$14 million on any planet.

1:26:59Rachel Cruze:So with 600 acres of land?

1:27:02Dave Ramsey:Well, you might have a piece of real estate that's worth some money, but the company itself is generating a million dollars. And you would be crazy to pay$14 million for that. So what is the land worth? Sure.

1:27:15Rachel Cruze:Yeah, the land itself is the bulk of that I'd say that's at least 9 million, 9-10 million

1:27:22Dave Ramsey:Okay, that'd be about right If it's 10 million So a company that's netting A million is probably worth about 4 And the land Is worth 9, so you have two transactions Is my point You have a real estate transaction You have a real estate transaction and the purchase of the actual business Because you can pick the business What kind of business is this, farming?

1:27:44Rachel Cruze:Yeah, it's farming. It's a specialty crop.

1:27:46Dave Ramsey:Okay. I was going to say you can pick it up and go do it somewhere else. That's not possible. Okay.

1:27:53Rachel Cruze:Do your parents own the land outright, Stephen? No, that's another thing. Several of the acreage, they do own outright, but the majority of it has a loan on it.

1:28:06Dave Ramsey:How much debt is against the$10 million in real estate?

1:28:11Rachel Cruze:it's right around 2 million so they have a good amount of equity but yeah and amount of debt for a small company yeah

1:28:24Dave Ramsey:and uh yeah yeah yeah okay all right um i'm trying to think how to structure this all right let's go back to the but the easiest one okay the easiest one is the business itself not counting the land. Okay. If you were to give them$4 million for the property or not for the property, value the property of 10 million and we're going to give them 4 million, then the way I would do that is I would tell you and your brothers to take a bare minimum wage for the work that you do, whatever your, what is your position with the company?

1:29:02Rachel Cruze:Operations manager. And what do you get paid for being operations manager? um we need to get paid around 100 000 okay so if you and you can live on that

1:29:12Dave Ramsey:yes okay so i would tell you to continue to take a hundred thousand each as your um salaries which nets the company one million dollars am i correct yes okay and i would give them the one million dollars for four years you get a hundred percent of profits or 90 % of profits for four years until we get to$4 million. If we have a better year and we have a great crop, we might get there in three years. We might get there in three and a half, but you're going to get out of there. You get a percentage of profits, the lion's share, the biggest portion of the profits, 90 % or so, until you get to$4 million, mom and dad.

1:29:53Dave Ramsey:That's how you buy them out of the business. Then we've got a$10 million real estate transaction to do It's a separate transaction. That's much more complicated. Because you take payments on$10 million out of your million-dollar profits, and you don't have any profit anymore. Yeah. So this business is not viable. It's not a profitable business. If someone came in and borrowed to buy the land and the business and borrowed$14 million, they would lose money. Right. And so the business cannot afford to pay market value for the land and make a profit. Right. So what are they going to do? They're going to will it to you?

1:30:36Dave Ramsey:Are they going to take$4 million as their retirement and then give you boys the dirt when they die? And you guys work to pay that$2 million off? That's what I would recommend. But I don't know if your parents are that generous or can see their way to do that.

1:30:52Rachel Cruze:I believe that that's the play, honestly. They don't have, you know, they've been running this business for a while, so they don't have any hard-liener retirement. The business is their retirement, so I would see that as a pretty good. If they've got$4 million in a mutual fund four years from now

1:31:07Dave Ramsey:and they live off of that and they give you guys the land, as a part of their estate planning, they could do it pre-death, unified estate tax gifts and that kind of thing. There's all kinds of ways you can do it. And we can even do an LLC and do partial interest and devalue those interests. There's all kinds of stuff an estate planner can teach you to do to get that land transferred to y 'all. And then you guys, after you get your parents paid off, go get that mortgage paid off quick. And you're sitting there with all this debt free. And this is a stinking cash cow now. You're killing it. It's wonderful.

1:31:39Rachel Cruze:Awesome. Thank you for your help.

1:31:42Dave Ramsey:Yeah, that's what I would do. But if they want to be paid$14 million, I don't think you can do it. I think you'll go broke.

1:31:49Rachel Cruze:He can't, but could they go out and get?

1:31:51Dave Ramsey:They couldn't get, no one would give them that. Would do that.

1:31:53Rachel Cruze:Yeah, is what you were saying. What you'd have to do is sell the land and sell the business.

1:31:58Dave Ramsey:But you can't sell the business separate from the land because it is a specialty crop on that land. So they are inextricably tied together. Where like, you know, Ramsey could operate in any building. We happen to own the building, but that's a separate thing than Ramsey. Sure. so um you could pick this up and put it in another office building somewhere right and uh then so the real estate doesn't destroy the business or vice versa um but where it's tied together with a specialty crop in particular sorry i don't know maybe they're growing what avocados or something it was a california right so i don't know i didn't ask him what the crop was but and you know it's it's probably some kind kind of something that has been done there for almost generational on that piece of dirt.

1:32:43Dave Ramsey:So those trees or those plants are mature to produce the crop that they're producing, and you couldn't just go do that somewhere else, probably. I'm not an agricultural expert, but that's common sense, I guess. Wow, interesting. Very interesting. Yeah. Yeah, so one of the things we've worked with a lot in our entree leadership materials is succession planning. And we've done a bunch of it here at Ramsey. I mean, you're looking at part of it right now. Rachel is one of the Ramsey personalities, the ability to carry on a brand after I'm not here for whatever reason. And so you've got to have a plan to carry on the brand.

1:33:25Dave Ramsey:You've got to have a plan to carry on the leadership. You've got to have a plan to carry on the ownership. and Rachel and our brother Daniel and I just did a panel at the Entree Leadership Summit in Disney two weeks ago for 3 ,000 business owners and we're talking about family business.

1:33:40Rachel Cruze:Yeah and I think what's hard in family business depending on how it's structured is that for a lot of people they grow a business and that's their retirement and so when you hand it off purchasing the business is usually the name of the game in family business and so making sure you sit down and you do it well with an attorney, right? You said the estate attorney, but lots of communication on the front end too, that everyone understands what's happening. It's really, really important.

1:34:06Dave Ramsey:All the spouses and everyone understands.

1:34:36Dave Ramsey:If you're a business owner who's serious about growth, you've got to be at Entree Leadership Summit 2027. Summit is our world-class leadership conference where you will learn from the people who have influenced the way we lead at Ramsey. You'll also connect with like-minded business owners who are facing the same challenges as you. To get your tickets for May 2027, go to entreleadership.com slash summit.

1:35:21Dave Ramsey:Thanks for joining us, America. We're so glad you're here. If you're buying or selling a home, it's a big deal. You need to get someone in your corner that really knows their stuff. Now, somebody got a license three weeks ago and you knew them in high school. No, that's not what we're doing. We're getting a pro that sells 100 houses a year, something like that. Get somebody that's high octane, high protein. Ramsey Trusted only has high octane, high protein real estate agents in our program. The Ramsey Trusted program is the only way to find a top agent that we have interviewed. We have done the due diligence on them.

1:35:53Dave Ramsey:It's a free service. Find a local pro, a Ramsey trusted real estate pro for free at RamseySolutions.com slash agent. Jake's in Columbus, Ohio. Hi, Jake. How are you?

1:36:07Rachel Cruze:Fantastic. How are you doing?

1:36:08Dave Ramsey:Better than I deserve. What's up?

1:36:10Rachel Cruze:All right. So about a couple of years ago, I decided to purchase a home with my mother and with the agreement that she'd only be there for like two to three years. And it to essentially transfer into my name. So recently we've been having more arguments because she likes to run the household her way. I like to do it my way. And she pulled from her 401k to pay for the down payment for the house. So she only has about 8 ,000 in retirement. So my question is, I'm trying to figure out how we can get out of this with both of us not being scathed.

1:36:49Dave Ramsey:Well, I mean, how much did she put into the house?

1:36:52Rachel Cruze:I believe a down payment was about$10 ,000. Okay.

1:36:56Dave Ramsey:And so what do you owe on the house now?

1:37:00Rachel Cruze:$239 ,000 the last time that I checked.

1:37:02Dave Ramsey:And what's it worth today?

1:37:04Rachel Cruze:The last thing I saw, it was$259 ,000 to$260 ,000. Okay.

1:37:09Dave Ramsey:So if you sold the house and she got her$10 ,000 back or whatever she put down back, and then you split any other profits, what would be wrong with that?

1:37:21Rachel Cruze:Yeah, that's fair. I guess it's mostly just I'm concerned because she's 57 and only has about$8 ,000 in retirement, and I want to help her the best way that I can.

1:37:33Dave Ramsey:Yeah, but keeping the house doesn't affect that positively.

1:37:37Rachel Cruze:Yeah.

1:37:38Dave Ramsey:She's got to get on her own and start putting money away for retirement. That's what fixes that. the house is not causing her to have retirement or be broke. Yeah. What does she make? I think, I'm not sure what she makes now.

1:37:54Rachel Cruze:She made about$40 last year. What is your dad? My dad passed away when I was 16. It was like 11 years ago.

1:38:04Dave Ramsey:Wow, I'm sorry.

1:38:06Rachel Cruze:It's all right.

1:38:07Dave Ramsey:And so she has struggled ever since.

1:38:12Rachel Cruze:Yes and no. She, for a time period, had a really well-paying job, but the amount of hours she worked, she said kind of just burn her out. But that's where most of her retirement money came from in the first place, was just from that job. How often is she working? What's her work schedule look like right now? So she works. She has two different jobs, but they're both like part-time. Just one, she's an accountant for a restaurant, and the other one, she's kind of like a personal assistant.

1:38:42Dave Ramsey:The problem is, is your mom is a widow with a broken heart, and she needs to dream again. Because she's not got any income, and she's 55 years old. She's still very young. Yeah. And she desperately needs to say, what am I going to do with my life the next 20 years? I need a career where I'm working towards making$100 ,000 a year and not working two part-time jobs and living with my son.

1:39:13Rachel Cruze:She's emotionally just getting by. Well, she said she doesn't want a career.

1:39:18Dave Ramsey:She needs a career. She needs something to put her hand to to give her meaning and give her something to drive for. She's too young to sit on her butt. and she can't afford it. So consequently, her career has been deteriorating rather than going up. Right. And so this is what she needs. So it will be good for you guys. It'll be good for her because it will force her to face all of this for y 'all to separate this out. This house does need to be sold. If you give her, you're 27, 28, right? Yes. If you give her all the money from the house and just go live your life, you're okay yeah so give her all the money and tell her to put it in help her put it in some good investments and help her to you pay for a class and go take a class at the community college and start to what do you want to be no mom do you want to be a nurse now do you want to what is it you want to do with your life you're gonna have to do something and so it's time to sign up and dream but the the plan that you guys had before dad died is over now we need a new different plan We need a new plan.

1:40:27Dave Ramsey:And it's heartbreaking, but it is her reality. And she's perfectly capable. Her biggest problem is she's just still living with the heartbreak. Am I wrong?

1:40:41Rachel Cruze:Yeah. They divorced when I was a baby, so it wasn't. Okay.

1:40:47Dave Ramsey:But she's never really done anything since then, then.

1:40:51Rachel Cruze:Right. Well, she had, like I said, like that, I think she was only there for like six years, six or seven years. The one job that she had, I was saying, she actually had a good income from. But yeah, after that, she hasn't really had anything that was like. What are you doing, Jake? What's your job? I work as a utility locator. I locate power lines. Okay. Okay. Yeah, I think it's good for both of you to sell this house. You both need separate financial lives instead of trying to mingle it together. And, you know, and I think for both of you to encourage each other in this new endeavor for her and you encourage her.

1:41:30Rachel Cruze:But there's only so much you can do, Jake. You're not going to be able to change her. You can't make her go do something. But you can speak and be encouraging in your conversations with her and what you see in her and what she's good at, what she loves. I mean, all of it. But I would for sure sell this house.

1:41:50Dave Ramsey:Now, prospering for someone, this is the second call we've taken today on a 55-year-old lady, right? Prospering for someone is not merely making more money. You're prospering when your spiritual life is full. Your relational life is full.

1:42:09Rachel Cruze:You're taking care of your body.

1:42:10Dave Ramsey:Your meaning, your physical life is full. Yes, all of it, yeah. That is prospering. But these things are holistic in that they are tied together. And so when you allow one area of your life to completely deteriorate, 100 % of the time, some of the other areas are also deteriorating. And so you get out of shape. You know, you've given up on God. So you walked away from your spiritual life.

1:42:37Rachel Cruze:You isolate yourself from friends.

1:42:38Dave Ramsey:You pull away from relationships. All of these things are. And what we find is that people that are successful work the opposite side of that. And they're very intentional about building friendships. They're very intentional about their physical health. They're very intentional about their spiritual walk. They're very intentional about their career and their money income. And they do all tie together. If you have only one of those working in the wheel of life, as Zig Ziglar used to call it, these different areas, you only have goals in one area of your life, or two areas of your life. The other side of the wheel is flat and you have, anytime you have a flat tire, you have friction.

1:43:16Dave Ramsey:Yep. And it's a problem. And so.

1:43:18Rachel Cruze:You know, we were just having a, we did a podcast with a guy yesterday. Yeah. You did one interview and I did another and he was talking about how he interviews very high, successful people, billionaires, people that have sold companies, you know what I mean? Just insane. And he said, and you can sit with them and you feel almost like this energy from some. Some are still anxious and discontent and nothing is satisfying them. And he said, all these buckets of their life, you can tell there are absent. Some of them, they're not taking care of themselves physically. They don't have good relationships.

1:43:46Dave Ramsey:And other ones, you get this holistically fit.

1:43:48Rachel Cruze:And he said, and you feel a peace. There's something about this, this well-roundedness. And again, there's certain seasons of life. You're going to be working on your marriage more. Certain seasons of your life, you're going to be working on your career more. I mean, you know, it goes through seasons, but overall, the overall scope of your life having, he would call these buckets. He said, all of them full. And there's a leveling to that and a beauty, a grounding that you really do feel. And it's those people that live a peaceful life. Yeah, absolutely.

1:44:19Dave Ramsey:That's how it works. So, Jake, that's what we want for your mom. And that's her advice. Five years from today, you'll be the same person you are today, except for the books you read, the people you meet, the goals you set, the decisions you do towards those goals. That's Charlie Tremendous Jones, and he was exactly right.

1:45:06Dave Ramsey:All right, let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey Trusted Agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back from the first call to closing day. Find a Ramsey trusted agent near you at RamseySolutions.com slash agent. That's RamseySolutions.com slash agent.

1:45:54Dave Ramsey:Ramsey Show Question of the Day is brought to you by Why Refi? out-of-control private student loans can make it feel like you're stuck financially. But Y-Refi helps borrowers explore refinancing with low fixed rates and payments that make sense for their budget. Visit yrefi.com slash Ramsey. That's Y, the letter Y, R-E-F-Y.com slash Ramsey might not be in all states.

1:46:20Rachel Cruze:Today's question comes from Sarah in Illinois. My boyfriend and I have been together for three years and he recently took a job four hours away. I own my condo and still pay about $1 ,500 a month in the mortgage, even though I'm at his place 60 % of the time. He's asked me to pay for a bigger apartment since we both work from home and need more space when I'm there. While I still have my own bills, I understand the larger place benefits both of us. Should I help pay for the new apartment. No, Sarah, I would not. That's his apartment and you have yours. And if he wants a bigger one, that's great.

1:46:59Rachel Cruze:But.

1:46:59Dave Ramsey:And if he wants his girlfriend to live there, maybe she should be his wife. Oh, that changes the equation.

1:47:09Rachel Cruze:Yeah, no, I wouldn't be mingling bills. I wouldn't be trying to pay a rent because here's the thing. If you guys break up and then he's stuck with that rent that he can't afford, what's he going to do? So it's way better when you are dating to keep your finances separate. You pay your stuff. He pays his. And if he wants a bigger apartment so that you all can work there together and all the things.

1:47:30Dave Ramsey:He wants you to live in that city and you sell your condo and we get a place there. Oh, that would be a great idea after we're married. This is what's putting the problem on it. Yeah, put a ring on it. That's the problem. because it sets you up for a, you know, you're getting a bad end of this deal all the way around. It's killer for you.

1:47:55Dave Ramsey:So, this used to be, you know, when I started this show, Rachel, the biggest thing that came up was credit card debt. Cut up your credit cards. And now I still say that. And then the next thing was we laughed and called it the, instead of the Dave Ramsey show, in the old days we called it the sell the car show. because like the answer to every question was sell the car sell the car now the answer to

1:48:15Rachel Cruze:every question is get married it's so true the amount of relational mess that happens the entanglement of dating people today when you are dating you're not married keep it separate when you are married combine it it's just that easy so confusing it yeah it's it's because the data

1:48:37Dave Ramsey:is in it's in i mean the research is in there's stacks and stacks of paper that says you're screwed that's what it says every bit of the data says you are messed up because again i covered this in another hour but the a lady in her 30s has a net worth if she's not married and she's living with someone and or does not married a net worth that is about one tenth of her married friends.

1:49:06Rachel Cruze:And the guy is what, five times, has a fifth of his net worth.

1:49:11Dave Ramsey:And the guy has about 25 % of the net worth he should have, yeah. And so there's a thing we used to call in the literature the marriage advantage. And it's still there, but it's even more pronounced now in the financial realm, but it's pronounced in other realms as well. Like for instance, physical health. A man that is married lives seven years longer than a man that's not on average. That's just a statistic. Okay. I mean, you could, you could argue why we can have lots of fun with that. Women help men.

1:49:46Rachel Cruze:That's why.

1:49:47Dave Ramsey:That's why. Help them be better people. Are you going to eat that? Yeah. I mean, it's that, that's, that's real. And so

1:49:56Dave Ramsey:the...

1:49:57Rachel Cruze:Now don't get married to someone who's a loser too. So, but don't be dating those people as well. Like we're not saying just because you're...

1:50:05Dave Ramsey:I don't think that's her problem. No, but just in general,

1:50:07Rachel Cruze:we're just like making generalities. So remember, be smart about it. If you enter into a lifelong covenant, make sure it's someone worth doing that. But people you're dating long term should be worth that. So...

1:50:18Dave Ramsey:Yeah. But here's what's interesting on this one. For Sarah's sake, look at this. Okay. He takes a job and leaves. Now follow me. Oh, now pay for it. Now pay for it. now pay for following me yeah i mean yeah what a prince yeah there we go

1:50:42Dave Ramsey:it's it's all right there on the paper i'm just saying david is in phoenix hey david how are you

1:50:48Rachel Cruze:hi dave hi rachel good um it's a pleasure to speak with the both of you i've uh i've heard that uh i've heard dave talk before about the if dave dies meeting and it got and you're really thinking about my own family. And I feel like I need to have a similar conversation with my parents soon as they get older. Just to give some context, I'm 23 years old. I have three siblings. My parents are 72 and 68 years old. My oldest sister is in her early 50s. And I also have a brother and sister in their 20s who both have Asperger's syndrome. And they still live with my parents. My parents are both retired.

1:51:21Rachel Cruze:And to my understanding, they have a net worth of around$2 million. I'd like to have a family conversation sometime this year so everyone can get on the same page, especially my parents and my oldest sister, about the expectations for responsibilities and how the assets would be handled when they eventually pass away. Because as of right now, we're both kind of in the dark. So I want to know what are the most important questions that I should be asking and what are some of the key topics discussed in the Ramsey family meetings that would be most important for any family to cover. It's a great question.

1:51:55You have to lay a foundation with your family first before you have that other part of the conversation. And the first part of the foundation is, Mom and Dad, I am not wanting to have this conversation because I want any of your money.

1:52:11Dave Ramsey:I don't need any of your money. I am concerned about my two brothers. Is it a brother and a sister that have Asperger's?

1:52:18Rachel Cruze:Yeah, it's a brother and a sister.

1:52:19Dave Ramsey:I'm concerned about my brother and sister and how they're going to be cared for and what your wishes are. And if I don't know your wishes in detail, it will be hard for me to honor your memory. And I'm deeply concerned that I can do the right thing and that my older sister and I are in agreement on how we're going to do exactly what you want us to do when you pass away. Okay? And they need to hear that that's a foundational thing. You are not coming at this like, I want some of the money. Oh, no, we're not going to talk about it because we're giving it to the two that are disabled, you know. Yeah.

1:52:53Dave Ramsey:And so, you know, they'll get their back up. You know, you'll get a resistance there, a defensiveness that we don't even need to start with. So let's just lay that down. Say the only reason for this is for me to have the information to be able to honor your wishes and execute and ensure that what you've wished in the well, even if I'm not the executor.

1:53:13Rachel Cruze:And to make sure that brother and sister have the documents in place that they're going to be taken care of. I want to make sure that things are laid out from a legal perspective.

1:53:23Dave Ramsey:Once I know what you want, then I'm going to help you get what you want. Now, then do we have a proper will, which in this case would include probably special needs trusts to take care of the two special needs people, right? Okay. And then how's that money going to be invested and what do you want done with that property and what do you want done with that investment account? and how do you want it handled and who do you want us to contact. And who's the executor?

1:53:47Rachel Cruze:Is it sister that's going to be doing all the details?

1:53:50Dave Ramsey:Is my older sister the executor? That's fine. If you don't want me to do anything with it, I won't do anything with it. All of that's okay. I just want to know that for your all's peace of mind that we're all on the same page. Okay. And then what we're going to do, once we're all on the same page, The Ramsey thing is we just sit down, and part of the meeting is we go through the real estate that we own, and we look at it, and we go, okay, here's what the will says about this real estate, what portions of it are in a trust and which portions of it are in LLCs, and what portions have already been moved into the children's trust because we've done some stuff there from an estate planning standpoint tax-wise.

1:54:32Dave Ramsey:Here's the life insurance that's in place, and here's the beneficiaries on it and where it will go. In my case, there's not any. Um, and, um, you know, what do you want to have happen with the home place? What do you want to have happen with this or that? And it can go all the way down to my wife's 97 year old dad said, told the kids about eight, eight or 10 years ago, his kids, uh, to walk through the house and put a sticker on the back of something if they wanted it. And so the house has got all these sticky notes in the back of the pictures in the backs of the figurines and stuff. Yeah.

1:55:04Rachel Cruze:No, I will say it's funny. He asks, the meeting is not called if Dave dies. It's when Dave dies. Dave will not live forever. If Dave dies this year. As long as we want. It's if Dave dies this year. Okay, that's it.

1:55:15Dave Ramsey:It's the Monty Python meeting.

1:55:16Rachel Cruze:I'm feeling much better. We want him to live forever. It's just a flesh wound. But it's not going to happen. But we love him.

1:56:04Dave Ramsey:We'll be right back. And it's the simplest way to make a plan for your money before the month begins. So no more wondering where your money's going. You're telling it where to go. Download Every Dollar in the App Store or Google Play and start for free today.

1:56:40Dave Ramsey:Our scripture of the day, John 14, 27. Peace I leave with you. My peace I give to you. I do not give to you as the world gives. Do not let your hearts be troubled and do not be afraid. Babe Ruth said, never let the fear of striking out keep you from playing the game. Brianna is with us in Sioux Falls, South Dakota. Hi, Brianna. How are you?

1:57:04Rachel Cruze:I'm good. How are you?

1:57:05Dave Ramsey:Better than I deserve. What's up?

1:57:08Rachel Cruze:I'm wondering if I should get a work from home job. I am a mom of three under two, and we're going under every time we get paid. Oh, my goodness. You have twins? No, I just had a baby. He's three months. I'm just about three months old. Oh, wow. Okay. So how much is the new job work from home is going to pay? I don't know. I'd have to see and find one, I guess. But I did look into it, and I'd have to make at least$3 ,000 a month for it to be worth it, because right now we are on, like, SNAP and WIC and Medicaid. So I'd have to be able to make enough to cover all of that.

1:57:50Dave Ramsey:What does your husband make?

1:57:53Rachel Cruze:He makes roughly$43 ,000 after taxes. Okay. And we're about$34 ,000 in debt.

1:58:01Dave Ramsey:What does he do? too.

1:58:04Rachel Cruze:He is a bricklayer. He works for the union.

1:58:08Dave Ramsey:So with$43 ,000 income, you qualify for every part of welfare. I didn't know that.

1:58:15Rachel Cruze:Yes. Through the winter is when we qualify. We're just getting out of the winter because we went through about two or three months where the max amount of money that we made was maybe$800 for that whole month. So we qualified for all of that. Rick and Medicaid, But in the summer when he's working, you don't qualify? Yes. Yeah.

1:58:38Dave Ramsey:Okay. That makes more sense. Now I'm tracking with you. All right.

1:58:42Rachel Cruze:Yeah.

1:58:43Dave Ramsey:So he makes a lot more in the summer, like a bazillion times more. So how long has he been doing that?

1:58:51Rachel Cruze:He's been with the same company for about five years now, six years maybe.

1:58:57Dave Ramsey:All right. He just started working. Yeah, my first piece of advice for you all would be to pan back from this and say, we're a young couple with three children, and we're going to have to make some overall decisions about his career that allow us to feed our children without the government doing it.

1:59:23Dave Ramsey:So what is he going to do in the winter when he's not laying brick, in other words?

1:59:30Rachel Cruze:We've gotten by by God's grace at this point.

1:59:33Dave Ramsey:No, you got by by Snap.

1:59:36Rachel Cruze:Because he wasn't working in the winter.

1:59:39Dave Ramsey:So he needs to be working in the winter. That's my point.

1:59:44Rachel Cruze:Is he not doing anything in the winter? Yep. He'll do side jobs. Yeah. But he didn't have anything this week. Winter. Yeah, he needs to be making$1 ,000 a month somewhere. I mean,$1 ,000 a week, you know what I mean? In the winter. Waiting tables.

1:59:58Dave Ramsey:And what are we going to be doing when we're 44? Because this plan's not real good. Yep. It's leaving your family very vulnerable. Are you stressed? And I don't know how you're going to work at home with three kids under two and get any work done.

2:00:17Rachel Cruze:Yeah. Did you have a career before? Uh, yes, I actually, that's why we have, we have about 12 ,000 in student loans because I was a medical assistant. Okay. But you're saying with daycare for three to three under two, that's the most priciest age to put them in daycare. It's what you're saying. It's not making sense from a.

2:00:39Dave Ramsey:Yeah. You can't go into the workplace. I understand that. I don't have a problem with that assessment, but I really want you guys to visit this instead of just going and saying our plan. plan that we didn't have a plan was, uh, him, he's a bricklayer and he doesn't work much in the winter and, uh, we keep having babies. This is not a plan. It's, it's, it's put you guys in, it's painted you into a corner and your life is not fun. And so I want, I want good things for you guys. And it's going to involve him, um, making some changes in views on his income. Uh, what's he going to be doing in the next five years that doubles his income or in the next 10 years, that doubles his income, and that sustains his family through the winter.

2:01:22Dave Ramsey:He needs to be asking himself that. You two, as a couple, need to be asking yourselves that. And then that starts the whole conversation. So part of your debt is a student loan debt. What's the rest of it?

2:01:36Rachel Cruze:$17 is in a truck loan, and then we have$4 ,000 in a personal that got us through one winter, and then roughly about$15 in medical. Some of that's in collections, and then we owe family about$1 ,000.

2:01:50Dave Ramsey:Okay. I'm going to be mean. Are you ready?

2:01:56Rachel Cruze:I am. I'm going to say you're going to sell the truck.

2:01:59Dave Ramsey:No, I'm going to say it worse than that, okay? You do not get to own a$17 ,000 truck when you're taking welfare to pay for your kids' food.

2:02:09Rachel Cruze:I agree.

2:02:10Dave Ramsey:That is not okay.

2:02:12Rachel Cruze:My husband made that decision about three years ago. this truck has eaten us alive since we got it. And this truck's got to go. The motor blue, everything.

2:02:20Dave Ramsey:It's got to go.

2:02:21Rachel Cruze:Yeah. The only, so I'm going to, I guess, and then if this is going to be the thing, I've been telling him that we have to get rid of it as well. Yeah. But if we only get about 10 grand for it, we're still going to have to pay that seven outright when we sell the truck, and we don't have any savings at all whatsoever.

2:02:39Dave Ramsey:You'll be borrowing it from the place that has the truck loan to cover the difference, and I bet you can get more than that for it if you sell it private sale. but he's been looking up trade-in and looking up what Carvana will give him for it, and that's nothing compared to what he can actually get for it. A good working truck will bring a lot of money in Sioux Falls, South Dakota. Okay? And so he can get a lot more than 10 for it, and you probably are in the hole some. I'm not arguing that point. You're going to have to borrow a little money to cover that hole, but I'd a lot rather you be$4 ,000 or$5 ,000 in debt than$17 ,000.

2:03:13Dave Ramsey:and again i'm addressing head on the decision making paradigm that you guys are using to run your life and what you're doing you know i'm gonna do this over here and i'm gonna do this over here i'm gonna do this over here but when you tie those three things together they're not logical anymore and it's it's creating um pain for you guys and i don't want that for you i want

2:03:34Rachel Cruze:you to win well and you want to make sure your money habits and decisions kind of what you're saying, regardless of what happens, are steady. Meaning that before they had kids, she was working as a medical assistant. He's a bricklayer. Seasonally, I'm sure they were fine. His seasonal work and her, they could just make it. And then you pull her out of the workforce with three babies and suddenly your paradigm has to shift, to your point. You can't have that. Yeah. You cannot continue to do what you've been doing. And I'm talking to him. Yeah. What you did three years ago, meaning your truck, your choices on restaurants.

2:04:09Rachel Cruze:I mean, like all of it, it all changes because your life has changed.

2:04:12Dave Ramsey:And your choices on side jobs in the winter. Yep. And, uh, and, or an overall career change over the next five years that causes your family to be able to stabilize and sustain. Yeah.

2:04:21Rachel Cruze:That gets you to 70. I mean, the manual side of the trades is wonderful. It's amazing. And so there's a lot of opportunity for that.

2:04:29Dave Ramsey:A lot better than 40 grand a year.

2:04:30Rachel Cruze:Yep.

2:04:31Dave Ramsey:Yeah. And so, um, but yeah, don't get stuck in what I'm doing is okay when what I'm doing is not okay. That's the thing. And I'm not hollering at you. I'm not hollering at him for that matter. But when he was by himself and wasn't married and he was laying brick and he had a little downtime in the winter, he'd work it out. But now he's got responsibilities. And...

2:04:55Rachel Cruze:And Brianna, I don't even know how you're coherent. Making a sentence of the three-month-old and Two babies. You have a lot on your plates. And honestly, if you were just a full-time mom taking care of the household and making sure those babies are alive at the end of the day, that's a full-time job. So I understand the money needs to happen. And I hope that, yeah, there's a good situation that you can bring in some. But I mean, honestly, call me old school, but I'm leaning on him.

2:05:22Dave Ramsey:Dude, get to work. I am too. Get to work.

2:05:25Rachel Cruze:I got three babies at home that I'm taking care of.

2:05:27Dave Ramsey:That's no joke. And it's not that he's not working hard now, but it's get to work in a way that it brings in the money to take care of your family and get your truck sold, dude.

2:05:39Rachel Cruze:Yeah, but when you bring$800 home a month.

2:05:41Dave Ramsey:I know. Get your truck sold. Then you get to work. Yeah. You got to get some stuff going here and get you a$5 ,000 truck. That's the thing.

2:05:49Rachel Cruze:Call us back, Brianna, if you guys need anything. Hang on. We're cheering for you.

2:05:52Dave Ramsey:We'll send you a copy of the Total Money Makeover and get you on every dollar and try to help you if we can. that puts us our of 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