My Mom Wrecked My Rental & I Have To Evict Her

12:21Jade Warshaw:It's paid for? Her car that she gave you? Yeah, it's paid off.

12:26George Kamel:There's no payment or anything. So this is great news because it means you don't have to go buy a new car. and whatever we can get for this thing is what we get for it. Now, we need to pay off the loan. That's the problem. So we need to come up with a difference or scrape up the cash to get this thing fixed and then sell it.

12:40Jade Warshaw:You said you only had$1 ,000 liquid. What do you have non-liquid and what's the nature of it?

12:49George Kamel:In like my 401k. Okay.

12:52Jade Warshaw:Just making sure you didn't have stocks or like some coins sitting around. Okay. Yeah, I'm with George.

12:57George Kamel:We started doing that, but we're not at the point yet where it's like we can take out the money for liquid. You know what I mean?

13:06Jade Warshaw:Understood. We just started.

13:08George Kamel:So tell us about your work.

13:09Jade Warshaw:Are you working?

13:11George Kamel:I am working, yes.

13:12Jade Warshaw:Okay. What are you bringing in?

13:15George Kamel:I'm about 50, 55 ,000 a year. And do you have a spouse at home? Yes. Yes, I'm married. Are they working outside the home as well? Yes. Okay, what do they make? Around the same. Great. $100 ,000 income, great. We make six figures. So this is a solvable problem. Within the next month or two, we could probably scrape up enough to cover this if we live on nothing. So can you keep up with the payment for now? Yeah, yeah. Okay. I mean, that's what I've been trying to do. I mean, the carpet, it's like$322 a month. Okay. So you should easily handle that. On our screen, it says, should I do a voluntary repo?

13:58George Kamel:Is that what you were thinking about doing? So I called the dealership back, and I asked them, what should I do? And they said, your best bet is to do a voluntary repo with a credit. Oh, my goodness. Wow. I said, my credit just went up 50 points last week. And we've been really trying to do that, and I don't want to do that.

14:18Jade Warshaw:I'm so glad you didn't listen to them. That is called set you up for failure. So I'm so glad that you called us instead. Yeah, you're bringing home over six thousand bucks a month. You're handling the payment, but we want you to get out of this because obviously it's not running and we don't want you in any debt anyway. So I don't know if you have other debt to speak of that's sucking up more of your income. But I would put this kind of as a top priority. My guess is if you listed your debts model or just this is probably towards the bottom of the heap.

14:50George Kamel:um yes yeah this is actually the last this is my biggest bill oh this is your biggest bill okay great so you could knock all your debts out pretty quickly making 100 grand if you guys it sounds like you have not been on a budget it's kind of just been spending willy-nilly not really paying attention yeah okay that's 100 % accurate now are you and your wife ready to for some life change because we're about to be living differently for a little while yeah um i've been trying to do that was a lot of brain i don't know about that yeah i would i would have a real vision casting convo tonight where you say hey listen the way i've been leading us in money this is not an attack on her it's start with i statements the way i've been leading us when it comes to money has not been great and i own up to that and it's left us in a real pickle where we have this huge repair that we can't afford and we got all these payments around us.

15:47George Kamel:I'm ready to live differently. Are you on board to help us get out of this and stay out? See how that's not an alarming, attacking conversation? And then it becomes the byproduct is, hey, let's get on a budget and just see what our income is going to be this month, see what our expenses are, and see where we can do better to cut anything that isn't necessary for the next few months.

16:11Jade Warshaw:Yeah, and that's what this is going to look like. but it's going to start with the two of you and we'll make sure that you're set up to one. We'll give you EveryDollar. It's the best budgeting app out there, but it's more than that. It's really going to help you stick to the plan. I'm glad you called us because we're going to tell you the fastest and best way to get out of debt and build wealth and EveryDollar is going to do the same thing for you as well. So Kelly will pick up and get that to you, but the key is you guys have got to get on this. You guys have got to work it together. It's totally up to you to do this.

16:40Jade Warshaw:So, George, let's talk real quick about repo because I feel like, first off, I feel like we're getting more and more calls about that. I don't know if that's just a reflection of the high cost of living right now and people are falling behind on payments that they got when auto prices were super duper high. I'm not really sure what the correlation is there. I could speculate on that a little bit. But repossession, guys, is never the answer.

17:04George Kamel:When you hear the word repossessed, what do you think of, Jade?

17:06Jade Warshaw:It sounds like a demon. It's a possession.

17:09George Kamel:just tie them together when you hear that word and so here's the problem yeah whether it's involuntary or voluntary involuntary is they show up at your driveway and they take that bad boy

17:18Jade Warshaw:yeah but don't do voluntary a lot of people think there's a difference between the two well i'm just it's on me i'm voluntarily giving it up no it's still you're still going to have to go through

17:27George Kamel:the same negative process yeah it will destroy your credit it leaves you liable for the difference after auction so here's what they do yes they go sell it for like pennies on the dollar to get what they can, then they come after you for the difference. And so you're in no better of a spot than if you just continued keeping up with the payments and tried to sell it yourself. That is the goal to sell it on your own, to get way more so that you're at least less underwater.

17:50Jade Warshaw:That's right. And if there's, here's the thing, if you are underwater, maybe you have a vehicle that, like I said, you paid too much for, you're underwater on it. Guys, what we would suggest here always, some less debt is better than high debt, right? So let's pretend you had a vehicle that you spent$30 ,000 on and now it's only worth, I don't know, 15, half the amount, you're upside down. We're always going to tell you, go down to the credit union, see if you can get a loan for the difference. See if you can get that. I don't care. You can put it on a credit card for all I care. I just want that number down.

18:21I want you to be paying$15 ,000 of debt

18:24Jade Warshaw:instead of$30 ,000 of debt is my point. And then from there on, now we can actually work out of this. Now you have a lower monthly payment. So again, that's going to come and work for you on the debt snowball. You have more money to throw out your debts, smallest to largest. That's why we suggest that. But please, please, please never go down to the dealership and ask them what they think because they don't have your best interest at heart.

18:48George Kamel:Yeah. It's like making a deal with the devil and then going back to the devil for financial advice.

18:52Jade Warshaw:Yeah. And thinking he's on your side.

18:54George Kamel:Exactly. And so this is not a knock on every dealership in the country, but generally the dealership is the most expensive place to buy a car and get any repairs done.

19:02Jade Warshaw:Well, they're not your financial advisor. And at this point, we're talking about a financial decision. And that's really where the conversation changes. They want to sell you a vehicle. They're in the vehicle business.

19:12George Kamel:But you go back to the devil you know. Yeah. A lot of devil references here. A lot of demons. I apologize to the kids watching out there. Yeah.

19:18Jade Warshaw:What's wrong, George? Is something going on? I'm just so angry.

19:20George Kamel:People are getting hosed. I talked with a guy in the street last week, 28 % APR on his car loan. Lordy. Lordy. Because their credit's shot. And what do they do? They say, well, hey, we can work with you. What kind of payment are you looking for? If they say those words, run, you are about to fall for a borderline scam.

19:37Jade Warshaw:Yeah.

19:37George Kamel:And they'll extend the loan, hey, 72 months, 96 months, whatever you want. We can make it happen.

19:43Jade Warshaw:Guys, let me tell you, a cash car, that's where it's at. Can't be underwater on that. You can't be underwater. And I would rather drive a cash car that's 10 years old than have a payment that's going to keep me broke for the foreseeable future. I'm just saying.

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21:50Jade Warshaw:So one of the best things that you can do for your finances is to have a really good tax pro in your corner that you can trust. They'll help advise you on the best moves to make for your situation or for your small business, especially if you've had some big changes in your life in the past year. So go to RamseySolutions.com slash TaxPro to find CPAs and enrolled agents that have been vetted by the Ramsey team. You need this. All right, let's go to George, who's in Boise, Idaho. Hey, George, how you doing?

22:21George Kamel:Doing well, thank you.

22:22Jade Warshaw:Yeah, no problem. How can we help today?

22:24George Kamel:so i was uh i just started talking to uh my lender we my my wife and i bought our first home a little over a year ago and he was reaching out because interest rates have you know kind of gone down and we talked about possible refinance in the future and uh he did a soft credit pool and it was kind of running me through options and um i come to realize that my wife is in about 24 000 of credit card debt that I was naively unaware about. I knew she had some debt, but I didn't know it was that bad where there's four cards, three of them that are about 99 % almost maxed out. Wow. Well, you say naively.

23:08George Kamel:Why didn't she tell you? I'm not 100 % sure.

23:14Jade Warshaw:How long have you guys been married?

23:16George Kamel:And it's, it'll be 15 years this April. And how long has this debt been laying around? Some of it, you know, five years or so. And I just was not aware that it was that bad. I don't think it was that bad. But I think it's just one of these things where she just uses the card and doesn't really think of the repercussions. Again, I'm not 100 % sure. but I've been trying to... This is beyond like I'm casually using a card. If you've maxed out three credit cards without telling your spouse, this is straight up financial infidelity. There's no other way to say it.

23:54Jade Warshaw:Do you combine your money or are you guys doing the separate deal?

23:58George Kamel:We've been doing separate. This is obviously what I thought would work best. And we just, you know, I'm the majority income breadwinner and I cover mortgage. I cover card. I cover most of the bills. I let her do, you know, handle. yeah um ensuring or you know well i mean you got you you kind of have set yourself up because

24:18Jade Warshaw:unfortunately what happens in an environment where you don't have full transparency uh which is we don't have things combined therefore you have your world i have my world like you said maybe you do the insurance i do the mortgage right it does set up this idea that i can kind of do my own thing over here and as long in her mind it's probably as long as it doesn't affect you we're we're square and then that sets you up to have the same thing. So that's the danger, George, both of the Georges I'm talking to right now. That's the danger.

24:50George Kamel:When you silo your money like that.

24:51Jade Warshaw:Yeah, when you silo your money.

24:53George Kamel:Have you confronted her about where all this money was spent and why she did this without telling you? Yeah, I just, we recently bid it and, you know, and it was, like I said, so we had, you know, I guess she put my daughter's braces on one of them. She had some health issues a number of years ago where she had to get some stuff and she put it or, you know, for her to pay the medical expenses and she was using one of those to do that.

25:17Jade Warshaw:So she's not buying Louis bags, you know, she's not out here. No, no, no, no, no. Okay. Well, that's good.

25:23George Kamel:That's the good, the upside here. More noble purchases, I guess. I still want to see the credit card statements and fully understand what was going on here. I started going through them yesterday and then she even did some cash advances. I'm like, that's the last thing you ever want to do on credit cards because one of her monthly payments is like$242.

25:44Jade Warshaw:Have you guys had the conversation that we don't engage in debt? Has that been something that you guys have said to each other, that this is feeling not only that it's something that she kept from you, but it's also crossing a values line for you? Or have you never had that conversation?

26:02George Kamel:Well, it's something where she knows that I've been working on because I had terrible credit, you know, maybe six, seven years ago in the low 500s. I couldn't even get a$500 credit card from my bank. And now over the last years or a few years, I've learned how to play the credit game, learned how to what to do with it, not to buy things just because, you know, if I don't have the cash, I had to kind of learn a hard way. But that same bank that wouldn't give me a$500 credit card. Now I have a$46 ,000 credit card with them.

26:31Jade Warshaw:And I don't I maybe owe$1 ,000 on it. Here's the problem. for some part. Here's the problem. Here's where the confusion is. Here's where the confusion is. There's a lot of confusion in this. And I hear what you're saying, and it now is crystal clear to me. So there's two or three issues here. Number one, like what we already said, the money is siloed. So because of that, there is just going to be a level of secrecy. So that's thing one. And you both have created that environment. Thing two is there isn't a clear stance on debt in your relationship. It sounds like it's, if it's, if it's this kind of debt, it's okay.

27:08George Kamel:If it helps our credit score, then maybe.

27:11Jade Warshaw:And so I think that's created. That's the second problem is there's just not a clear stance on what does that mean? And then the third thing is, yeah, there is a lack of communication. There is something there that she didn't feel like she could tell you. Even something like braces, Hey, I have to use this money for our children's braces. so there's a communication there or some sort of like lack of trust that I don't feel like I can come to you with this or I don't feel like I can share this so these are three main issues and I hearing the call George what I would suggest is if you can take a level of ownership in this too and then you can come to her and say you know what we've gotten off on the wrong track like both of us and I see my part in this and I I want to change what I'm doing today and I like I hope that you're here with me because we can't keep going like this.

28:04Jade Warshaw:I want you to know that I trust you. I want our finances to be together. And what I'm finding right now is I was focused on debt and I kind of was a hypocrite because I was saying my debt was okay, but yours wasn't. And I think honestly, going forward, we just need to say that debt has not been good for our relationship. And going forward, I don't want to engage on it. I don't know about you, but this is what I want to talk to you about. And that's how I would approach this.

28:31George Kamel:Yeah, no, I love that. And that's the conversation I had last night when I said, regardless, your debt is my debt. I have like$4 ,000 in debt. But I told her, and I'm thinking, oh, we just finally got a tax return for the first time in like two years because I'm making more money than I've made in the past. So having to adjust for things like that, I had to owe the last two years, but having extra money taken out and being on top of the finances where we got like$4 ,500, I'm like, okay, cool. Maybe we can use this to pay down our credit card debt, thinking ours is roughly around the same, not realizing ours was as much as it was.

29:11George Kamel:Yeah. So what's your total consumer debt now? It's about$30 ,000 between the both of us. Okay. How much do you have across checking and savings? liquid um like leftover or just currently right now currently um i have about twenty three hundred dollars right now in my debit that's after mortgage and bills are paid okay i would likely pause in this refinance because it's going to cost you two to five percent of the loan yeah and i don't know that you're going to break even anytime soon so this might be a down the line thing right now the focus is just attacking this debt with the debt snowball that's the easy advice Just tackle it as if it was y 'all's debt and smallest credit card goes first, minimum payments on the rest.

29:55George Kamel:The hard part is going to be resetting your marriage and financial life and her rebuilding trust. And the way to do that is a micro commitment every day to be a person who is trustworthy. And that's going to involve transparency and accountability and having a joint account. And we know the plan and freezing both of your credit. Freeze all the accounts so that nobody could open debt in your name, including you. Make it really hard. Add the friction there so that we're not tempted. And if you do all of those things and get on a budget, there's definitely hope here. We can get out of this pretty fast.

30:31George Kamel:Okay. Well, a question with the snowball is because, like I said, most of them, they're all around the same. They're all like$6 ,400,$6 ,300. 6 ,600 I'm looking at.

30:43Jade Warshaw:Yeah, so what I would do then is I would do them in order. If it's 6 ,400, you know, if the 6 ,300 one is the smallest one, do that one first and then do the 6 ,400 one and then do the 6 ,600 one. So when you do the debt snowball, everybody, what we're doing here is we're listing the debts smallest to largest by balance, not by monthly payment, not by interest rate. It truly is by balance. And when you do that, you get those small wins quickly. You feel that rush of dopamine. You feel like, hey, I did something and you want to go to the next one. And it really is proven to be the best method to pay off your debt quickly.

31:18Jade Warshaw:And that's what's going to work for George, too.

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32:57Jade Warshaw:All righty, back to the phone lines. George, are you ready?

33:01George Kamel:I hope so.

33:02Jade Warshaw:All right, We got Sarah, who's in Las Vegas, Nevada. What's up, Sarah? How can we help today?

33:07George Kamel:Hi there. Good afternoon. My question is pretty much on garnishment, but also, of course, your guys' awesome guidance. Hit us. My husband pretty much pays, like, all of our bills and everything. um recently his wages have started to be garnished for a car that we voluntarily let go a few years ago so now we are um you know i downloaded the every dollar app and i'm trying to do the budget and it's like in our face that now we're short on bills so i'm kind of scrambling looking for a job I have a side business, but, you know, I obviously need like stable income to bridge that gap. So I'm kind of scrambling, looking for work.

34:03George Kamel:And we just recently been married for a while, but we just kind of recently started joining our accounts because of this and working on the budget. I guess my question is, should we or can we do anything about the garnishment?

34:19Jade Warshaw:How much is the garnishment?

34:22George Kamel:I don't know the exact details yet. He's working on getting that information, but I think...

34:28Jade Warshaw:Oh, so you haven't seen it actually happen yet? It's just been ordered?

34:34George Kamel:No, no, no. His wages are being garnished already. I just don't have the physical paperwork. You don't have the numbers. Do you know the balance that's owed? No, I don't. Okay. I don't. Well, there's some homework there, because once we know that, we can develop a game plan to pay it off aggressively using future income. I'm guessing you guys have nothing in savings. We don't. He did, but he does not have any more, so neither of us do. What do you guys make? Well, he makes, so before the garnishment,$43 a year, and then after it would be like$31, so a month. It's basically$2 ,600 because they take it directly from his paycheck.

35:17Jade Warshaw:Yeah, it looks like they can take up to 25 % of your income on a garnishment. So this does have the ability to really mess with you guys.

35:29George Kamel:There's nothing you can do about it. I mean, the lender sued you and they got a judgment that you owe the money and this is next step because you're not paying.

35:36Jade Warshaw:Did you guys, did you ignore the, when you were served, like, did you ignore this or how did you get to this point?

35:43George Kamel:Yeah, I got ignored pretty much. Yeah.

35:45Jade Warshaw:Okay. Okay. So we're not doing that anymore going forward. What's the status on, I mean, obviously you guys are married, the money's separate. It's like, you kind of know what's going on, but you don't know the amount of it. How are you? I think my question for you is what's the plan to come together to solve this? Because going forward, what I'm seeing big picture is we've got to get on the same page. And when life hits, we can't ignore it because it just snowballs and makes it worse, which you're finding to be true right now.

36:18George Kamel:Absolutely. I mean, we're pretty much, honestly, I'm just, we're getting into taking the biblical approach of marriage and finances and everything. And, you know, joining our accounts and being one and that's moving forward. But we do have, unfortunately, a lot of fight. What other debt do you guys have? page. We have a lot of debt in collections, but right now it's kind of just our monthly bills, like the mortgage, the phone, and cars and everything. So is there anything you can sell in this picture where you could free up some payments and even walk away with some cash?

37:00Jade Warshaw:Yeah, because there's still a chance that they might settle this for you if you can get with the creditor and say, hey.

37:06George Kamel:If I give you this much lump sum, can you call it paid in full?

37:09Jade Warshaw:Yeah, that's not off the table.

37:12George Kamel:That's what I was thinking about. He's kind of like hell-bent. I'm sorry for the reference. He's kind of like, well, let's let me have equity. And I have no idea how that works. But he's like, well, just call the mortgage company and see about that. So he wants to take out a HELOC. I don't know what type, but I just called to Inquire. And they pretty much were like, well, you have to run your credit anyways. and we don't even have the credit. Good. I'm glad. We don't have the credit. Please do not use your house as a piggy bank and go into more debt thinking you solved the problem.

37:44Jade Warshaw:Yeah, debt doesn't solve for debt. The only way you can solve debt is to pay it off with actual earned money. So here's going forward. So how's the job search going for you? Well, it's going.

38:00George Kamel:I recently, I haven't worked for a few years at a nine-to-five. It's kind of my own business. I kind of let that go because we need money. But I've been applying to pretty much everything within the past few days.

38:14Jade Warshaw:Today, I want you to know any job will do for the time being.

38:18George Kamel:And you'll be a server at the nearest restaurant. Yes. We're not talking about a fancy salary job right now. We need any money in the door.

38:25Jade Warshaw:And then the first order of business is to try to stack up. You need to sit down with your husband tonight, find out what the full amount owed is, and then try to scrounge together as quickly as you can, 60 to 70 % of what that is, or even 50%. Start small and say, hey, go to the creditor directly and say, hey, I know we don't have the full 8 ,000, but we have 4 ,000 today. Take it or leave it. Because they're in a position at this point, they're not expecting to get much, this garnishment of wages, that they're going to get what they can, but I would at least try to settle it. There's no guarantee there, but I would try that.

39:04Jade Warshaw:And then from here on, yes, the solution is income. There's not going to be a magic wand here. If you guys pull out a HELOC or any other type of loan or personal loan, you are just kicking the can down the field and honestly making things worse for you in the future. So for you guys today, the name of the game is income and drawing a line in the sand and saying, no more. This behavior of you over here and me on this side, that cannot continue. This idea of not facing our financial issues head on cannot continue. And I love what you said earlier, Sarah, that you guys are kind of trying to get onto this approach with your life and your money.

39:44Jade Warshaw:So keep doing that. Matter of fact, I haven't offered this in a long time, George, but if you guys, I love Financial Peace University. I love every dollar, but I love something about like, I'm like getting deep in this. So if you want to get into that, I would suggest it local church. I love that for you guys. We're also going to give you every dollar if you like the digital approach, but I think you guys could really use some people around you that are doing this and doing it the right way. FPU, Financial Peace always has some OGs in there that can kind of guide you. They've been there. Yes. And that's what you guys need.

40:19Jade Warshaw:This is a complete overhaul for you. And I think it's something to be excited about, you know?

40:26George Kamel:And on top of that, Total Money Makeover. We're going to send you a copy of that. So in between classes, you're going to be reading this book together. And it's going to fire you guys up. And if that doesn't light a fire under you, I don't know what will. But that's the game plan. It's no new debt whatsoever. Freeze your credit so that you can't do something as dumb as taking on a HELOC. Then we're going to cut our expenses down to nothing. And every dollar will help you with that. Then we're going to try to increase our income as much as possible. and that gap, that beautiful gap is called margin.

40:54George Kamel:And you're going to use all of that to attack these debts, to save up a lump sum, to try to get these other debts out of collections because those debts are next. They're going to come suing you for those. So it's like whack-a-mole right now trying to clean up these debts.

41:06Jade Warshaw:But the good thing, what we're teaching you, Sarah, is it feels like you don't have control over the situation, but you can gain control over it very quickly. And that's going to start by knowing those numbers. Something truly happens when you sit down at night, George, and you do your budget for the first time. And even if it's in the red, for you to just list out, this is the money coming in and this is the money going out for a lot of people. It's the first time they've ever seen it.

41:31George Kamel:Sarah mentioned that. She said, we did the budget and realized, oh my gosh, we're in the red every month. Yes. We can't keep doing this.

41:37Jade Warshaw:Yes. And then so having that level of control and then saying, okay, well, here's what we're going to do next. And they've got a plan, debt snowball. And that for me is the biggest piece. It's going to take time. It's going to take time to turn this around. But then to be able to say, OK, now I'm reading the Total Money Makeover. I'm going to my FPU class. All of those things combined is exactly what you need to stay motivated, light a fire under your butt, keep listening to the Ramsey show. That's the type of stuff that Sam and I did when we were paying off our debt. And you kind of have to just jump off the cliff wholeheartedly and really just submerge yourself in a new lifestyle.

42:13George Kamel:Just have faith that this process works because 10 million people have gone before me and have done it. Yes. not ish you got to go all in you got to do it go by the book and there's a reason it works

42:23Jade Warshaw:there's a reason it works i'm excited for you guys sarah this is the precipice of a brand new beginning and be sure to call us back and let us know how things are going or if you need any help whatsoever

42:49George Kamel:Dave, we got a lot of calls on this show where life happens. 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. 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. 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.

43:28George Kamel: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. 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.

44:00George Kamel: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. So don't wait. It's fast, it's easy, and it could make all the difference. Go to Zander.com or call 800-356-4282. Protect yourself, protect your income, protect your family.

44:37Jade Warshaw:Hey, welcome back to The Ramsey Show here in the Fairwinds Credit Union Studio. It's myself, Jade Warshaw, next to George Campbell. Continuing to take your calls, and we have Austin, who's in Tulsa, Oklahoma. Hey, Austin, how are you?

44:50George Kamel:Hey, guys, how are you? Can you hear me okay?

44:53Jade Warshaw:Absolutely. Fire away.

44:54George Kamel:Excellent. Wonderful. Thank you for taking my call. So I'll try to be brief here. We're a family of five with three kiddos, and we have just under$100 ,000 in debt, not including our mortgage. and while we can make minimum payments and are trying to tackle one of them, we just, we feel so defeated and our youngest has just been diagnosed with a lifelong medical condition and our oldest is on the spectrum and so a lot of our credit card debt went to helping get him resources that he needed. But we just, you know, you close our eyes, you wake up and we just have all this debt and so we're a little stuck.

45:29Jade Warshaw:Oh man, yeah, that's tough. That's tough to go through, especially with the medical challenges. How's your income in all of this?

45:36George Kamel:Yeah, household income is$164 ,000 a year. Good. That's a great income. You got a big pile, but you got a nice big shovel to help clean it up, which is nice. Can you tell me the breakdown of the debts? Sure. So it's a little bit like death by a thousand cuts. So we've got roughly$40 ,000 in credit card debt between two credit cards. And again, those were, some of it was poor financial decisions on our part, eating out, et cetera. But a lot of that was the medical stuff. I have$20 ,000 in student loans and we have two car payments. One of them is$28 ,000 and it's a relatively new car and the other is$8 ,000.

46:15George Kamel:So it's kind of close to being paid off.

46:17Jade Warshaw:Okay. Now you guys' income, is that just you or do both you and your wife work?

46:22George Kamel:We both work. So I bring home$80 ,000 and my wife brings home$84 ,000.

46:26Jade Warshaw:Okay, great. Okay, so what I'm looking at straight off the bat is maybe the first car that's worth$28 ,000. What's it worth?

46:37George Kamel:Yeah, that's what's tough. So we did the Kelly Blue Book value. And if we got like the perfect buyer, perfect money, it's probably at about$30 ,000 even. And so we'd make a little bit, but then we're like, well, what do we do for a decent safe car for her? Because she is from a different country, and so she's learned to drive as an adult. And so she's a little anxious that the car doesn't have a lot of those safety features to help her out.

47:00Jade Warshaw:Interesting. That might be solved with some driving lessons, but I think that you could find a – if you took the$2 ,000, do you have any cash saved? Do you have any money saved?

47:11George Kamel:We did, but we unfortunately depleted that. So it's kind of embarrassing to admit that, honestly. So we have to build that back up.

47:17Jade Warshaw:Don't be embarrassed. But what would be a goal coming away from this call is if you can sell that in pocket$2 ,000, obviously you're going to need to put$1 ,000 aside for baby step one, which is just that starter emergency fund. But then I'd very quickly be trying to scrounge together, I don't know,$7 ,000 or$8 ,000 and just get a car that is safe, that is reliable, that gets her from point A to point B. And honestly, driving lessons.

47:47George Kamel:Yeah. I mean, any modern car from the last decade is going to be safe to drive. It doesn't need every single bell and whistle of the lights on the mirror to let you know there's a car next to you and all that.

47:59Jade Warshaw:A lot of that's just paying attention, too.

48:02George Kamel:But you guys make – you bring home 10K a month or so? Yes. And that's – and she might actually get a pretty healthy race coming up, and I might too, actually. But we can bank on that. So this is like, and that's where the thing is, because we are, we are really tackling, I think we're doing it backwards, but, and I was going to ask you about our high interest credit card, but we're doing like the opposite of the snowball. Now that we realize what the snowball is, we may fix that, but we've been trying to throw money at the high interest credit card and we're throwing like almost two grand a month at that.

48:31George Kamel:And then minimum payments everywhere else.

48:32Jade Warshaw:Yeah. We're just, I'd swap this around. I'd swap this around. Your biggest, your biggest opportunity here is with that car payment, because if you can, how much are you paying a month for the$28 ,000 car?

48:43George Kamel:That we do it twice monthly, but it's altogether about$500 a month.

48:48Jade Warshaw:Yes. So if we said, hey,$2 ,000 from the sale, and instead of throwing$2 ,000 at this credit card every month, since it's not even the smallest debt, what if we pocketed that for two months in a row? Now we have$6 ,000. We can find a very reliable car. Surely there's someone in the community that you know. Ask around your church. Ask around at work. Surely somebody's selling something or knows somebody who is. and I like a used car like that because then I can get a more accurate picture of what the background of the vehicle is. So that would be my first move because if you can reclaim$500 a month plus to add that to now the margin of the 2 ,000 that you were already throwing at the debt, now you got$2 ,500 a month that you're pounding this debt with.

49:29George Kamel:And it knocks out over 25 % of your debt right there. So now you're down to 72 making 164. Now it's a solvable problem and you're not gonna be driving that car forever. So I don't want you to think, Like, you know, oh my gosh, this is a death mobile. I can't have her driving this. This might be six months to a year until we can upgrade if we get intense about this.

49:47Jade Warshaw:Yeah, and your current car is worth$8 ,000 and you guys have been driving that one just fine. So that would be a full argument for that choice to be made. Second thing is, I love that for you. Second thing is, I think you did say that you're getting right side up on doing the debt snowball the correct way, which again, by balance is what I would do. So what's the smallest balance that you have laying around? And you can include student loans in that too, by the way.

50:10George Kamel:Yeah. So I guess the other one would be that$8 ,000 MyCar, which we could probably take care of pretty quickly. So it's the$8 ,000. Then it would be the two credit cards. Our high interest one actually is at about$15 ,000. And we're planning on using MyLife's bonus to knock that down$3 ,000 or$4 ,000. But maybe we'll rethink that now with this. Then we have another credit card at$21 ,000. And MyStudentLoans at$20 ,000.

50:36Jade Warshaw:And the student loans is just one big chunk. It's not divided into smaller loans?

50:39George Kamel:It actually is divided in smaller loans. I don't know exactly what those breakdowns are right now, but they add up to just shy of$20 ,000.

50:47Jade Warshaw:Yeah, I'd look into that because, again, the whole method behind the madness of the debt snowball is small wins. So if you can, you know, say you look at that student loan, my guess is it's probably broken into$5 ,000 chunks. I don't know. I'm just going maybe by semester. But if you can feel that, oh, we knocked out$5 ,000 and you can see it as four pieces instead of one giant chunk, it does feel like it's almost the feeling of I don't know if you're like this, but I love making a list and being able to check things off my list. It just feels great. And it's the same way with debt. And so if you can look into that tonight and you might find, oh, this is broken into four or five smaller loans, that is going to do so much for your psyche while paying off this debt.

51:28George Kamel:So we talked about income. We talked about the debt. The last piece here is the expenses. And I can tell you guys have just been in survival mode, which means we're just going to eat out because ain't nobody got time to go get groceries and cook. We are stressed. We're exhausted. That's exactly right. Right. And so it's not because you're maniacal. You're just human beings. No, yes. And I will say since December, we've gotten really intentional about cooking at home, not eating out, doing all those things. And we've seen a pretty good difference. But, yeah, it's just the exhaustion after the end of the day.

51:58George Kamel:That's the temptation. That's where the spending happens. It's scrolling in bed at 11 p.m. and just adding to cart and going through the drive-thru. And so that's really going to be a great opportunity for you guys to create even more margin because you have a great income. We can all agree. You know, if you were 18-year-old Austin, you're going, you're going to make$10 ,000 a month take home one day. You'd be like, we are rich. That's right. And instead, you're looking around going, we don't have enough money to pay our bills. And so we've got to take some serious action because once we do clean this up, you guys are going to be in such great shape to build wealth for the rest of your life once we're done with this debt.

52:30George Kamel:And then you'll be able to keep up with the medical needs. That's an even better reason to become debt-free. When you've got those little kiddos as your why, there is nothing that will stop you.

52:39Jade Warshaw:And that's one part that we didn't really talk about. knowing what their medical needs are going forward. And you may need to have a fund that's there to the side. If you know, hey, we're spending, you know, a certain amount, a couple hundred dollars on this a month, or maybe even a couple of thousands of this over the course of a quarter. I would certainly have that money set aside, aside from your normal emergency fund, just knowing, hey, this is part of our budget at this point. It's something that we have to create a sinking fund around to make sure that money's there when we need it.

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54:54Jade Warshaw:All righty, then. Back to the phone lines we go, where we have Steve, who's in Chicago, Illinois. Steve, happy to have you on the phone lines, my man.

55:03George Kamel:Thank you for having me on.

55:05Jade Warshaw:You're welcome. How can we help?

55:09George Kamel:So me and my wife, we got married in 2024. She's originally from the Philippines, and she still has her family there. One in particular is her mom. And her mom, as of recently, has come on some financial problems that we want to help support her. And we're blessed. We're in a good spot. We can do that. The problem is that she lives with her son.

55:37Jade Warshaw:You're breaking up a little bit. You broke up on us, Steve. Can you hear me okay? Yeah, just repeat what you said again.

55:43George Kamel:So you said she lives with who? She lives with her son, so my wife's brother. Okay. And he's, I think, 42, 43 and hasn't had a job in many, many years. And the problem is he's basically sized off everything that she had for retirement. where the problem is we want to support her, but we don't want to enable him at the same time. So we're not really sure what to do with that situation. Well, at that point, you're just enabling his behavior. Exactly. So all you'd have to do, theoretically, you could talk to her and say,

56:18Jade Warshaw:hey, here's what we see, Mom, and this is your wife talking. We see that you could use some help and we'd like to help you. The only way we can do that is if you're separate from my brother, because what we've observed is not good for you. And we cannot give you money knowing that it could enable him. But my second question to follow up that is, how is it not enabling your mom or the mother-in-law? Is she unable to work? Like, tell us more about that part.

56:49George Kamel:Because this sounds like a forever problem that you're going to have to manage if you start giving her money forever. Yep. So she's retired. She had a good nest egg. They actually sold some land and filthings and stuff where she had a decent amount of money. And we've had that conversation with her of like, hey, she actually had a condo in a different area. But she refuses to leave the brother behind because she's worried about him and his life and stuff. But it's hard to explain it to her to where we want to support her. But at the same time, you know, we see the enabling that's happening. You may not be able to.

57:27George Kamel:Yeah, and that's where we're at.

57:30Jade Warshaw:You know, having stipulations or having something that you need to see in order to know that money is going to be spent responsibly, that's not mean or wrong or unfair. It's just honestly being a financially responsible adult. and if you've observed that she has not been responsible with her money and that there is a person who's taking advantage of her but she refuses to leave that situation where she's being taken advantage of there's not a whole lot that you can do other than other than say hey this offer is here if ever you want it but these are the terms of it and you know we love you but we can't let you know billy bob who's 43 continue to take your money and therefore take our money and um take it or leave it how much are you giving her right now um right now we've given

58:26George Kamel:her a thousand dollars but um no that's no right now it's been one time okay um she she actually um reasonably though she's in dire straits and she reached out to some of her sisters for money and then her sisters, my wife's aunts, reach out to us to let us know because she didn't want us to know about it. Because of shame or what? I think so. I think that's the biggest thing because she knows that her son is a problem. But everyone's healthy. Is everybody healthy? Yes, everybody's healthy. And how old is she? I think she's 70. Okay.

59:03Jade Warshaw:So, yeah, going out and getting a job is not going to be the easiest thing here.

59:07George Kamel:I think if you wanted to give and you knew the exact needs, you can try to give directly to those needs. So if it was, I don't know, covering her taxes and insurance for the year or covering groceries, you can make sure she gets a gift card that's in her control so that he's not just getting access to a bank account. Absolutely. So there's things you can do to try to separate this. But again, it's up to her to not enable him at that point and somehow turn this into him getting this money anyways. But if you can give directly to the need and that way he can't get access, that's probably the best way to do an ongoing gift.

59:41George Kamel:And it's also okay to say, hey, we can do a one-time gift of$5 ,000. We can't give you any more money. And if you squander it, if he takes it, that's all we can do.

59:51Jade Warshaw:Is he getting money from somewhere? Is somebody else providing for him that he's able to kind of do the other things he needs to do? He's just living there?

1:00:02George Kamel:yeah so i mean he got access to her money for a long time um he actually sold some family land he lived off of that for a while he's always going one to another thing after another is he an addict of some sort no nothing like that where is he blowing all this money we don't know that's the part that scares me i just want to make sure that your mom is in a safe environment as well, or your mother-in-law. And that might be a conversation between your wife and her to figure out, you know, what really is going on underneath the surface? How can we really help to give directly to the needs if we're going to continue giving at all?

1:00:39George Kamel:Because right now I would pause until you have more information because right now you might be throwing money into the abyss.

1:00:45Jade Warshaw:I would agree with that. And probably the most important thing out of this entire conversation is whatever you guys decide, you both have to feel good about it, you and your wife. It has to be something that you feel like, yes, this is money well spent and that she feels like it's money well spent because all of this is sheer generosity. And so for that reason, it's not something that must be done that is really yours to solve. But out of the goodness of your hearts, if you're doing this, that's a great thing. I just would not want it to cause any resentment between you two who are married. So that's good advice.

1:01:18George Kamel:That is a tough one.

1:01:19Jade Warshaw:All right. Thank you for the call. Let's go to Jack, who's in Kansas City, Missouri. Hey, Jack, how can we help? Hi, how are you guys? Good. What's up?

1:01:27George Kamel:So I am looking to figure out what I should do with a decently large sum of money. I don't have any debt. I basically have$200 ,000 of like liquid cash that I've saved. And then I just had a judgment in court that is awarding me about$530 ,000. Wow. Like I said, yeah. I mean, I've paid, I've always been really, I mean, I've been longtime followers of the show. So like I've always been very careful. I don't have any credit cards. I paid my student loans off. Like I don't have anything that's outstanding. And you'll be sitting on three quarters of a million dollars? Yeah, pretty much. Wow. How old are you?

1:02:12George Kamel:I'm 28. Single? Yes. Are you renting? I am currently, I'm currently renting with my brother, um, the past couple of years. So that's where I'm at with that. Cool.

1:02:23Jade Warshaw:Is there any like health or anything going forward that you need to know about?

1:02:29George Kamel:Um, no, I mean, I'm, I'm a pretty healthy guy. The one thing that I did do, um, just at the end of last year was, cause I wanted to get a good start on it. I did open like a Roth IRA and contributed like 7 ,000 just to the, for the past year, just to get a good start. Yeah, great. But still, I have all this that I feel like I could do something with. Yeah, I would split it across a few areas. Number one is giving. I think that's a wise thing to do with any amount of money that you get. And the other one would be saving and investing. And so that could be, hey, I'm going to max out another Roth IRA for the year, and I'm going to put a chunk of this into an investment account, like a brokerage account, non-retirement, just to have it grow with compound interest or compound growth.

1:03:09George Kamel:And then the final thing is you may want to buy a house with cash or upgrade your car with cash to a reasonable car and enjoy some of that money because locking in a house in cash at your age is one of the best wealth-building moves you could make. Yeah. So find something reasonable. I've been sort of thinking about that because, yeah, I bought my car with cash. I ordered a brand-new car, and I loved driving that away knowing that it was mine. Awesome. And then I thought about the house thing. I didn't know if that would be like a really wise move to go for that. Yeah, don't go crazy. But, you know, I don't know what houses are in your area.

1:03:45George Kamel:But if there's a single family home that's, I don't know,$400 ,000, I mean, you'd still have plenty left over to invest and give and enjoy. And so I would do all three things with it. I would spend, save, invest, and give. And if you do all of those things, you won't feel like you have a flat tire. But I love prioritizing a home. I mean, home ownership at 28, you'll be a unicorn, especially with a paid for house. So that's the key. Try to do everything with cash for the rest of your life. You've already been doing that. That's going to be the best way to steward this money wisely.

1:04:14Jade Warshaw:I love that idea. And just because you can afford a$600 ,000 house doesn't mean you need that. Just get what you need for your life in this moment. You can always upgrade later.

1:04:42Thank you.

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1:06:04Jade Warshaw:Hey, you know what? The truth is we wish that we could get to every call and every question here on the show, but that's just not possible. So if you have a money question and you want an answer for your specific situation, head over to our website and please use Ask Ramsey. Ask Ramsey is our free AI tool that's built and trained on proven Ramsey principles. You'll get an answer the same way we'd answer it right here on the show. Ask your question today at RamseySolutions.com or click the link in the description if you're listening on podcast or YouTube. All right, Manny is in Orlando, Florida.

1:06:40Jade Warshaw:Hi, Manny.

1:06:42George Kamel:Hi, thank you for taking my call.

1:06:44Jade Warshaw:You're welcome. How can we help today?

1:06:47George Kamel:So my mother is 65 years old. Her house is paid off. She collects social security and she kind of a house hack. She's got two studio apartments in her house, which she rents out and that's what she uses for income. However, she has very low retirement savings, about$50 ,000. So my idea was to outright buy her house so she can retire in the house and have some money to enjoy her retirement. And so that was kind of my question, whether this would be a good thing. and my concern is that she would remain, continue to rent out the couple studio apartments within her house and whether, you know, that would be advisable thing to do.

1:07:49Jade Warshaw:So you'd buy the house, so she has the cash spending money. She'd continue to live in it and you're just kind of, would bide your time until the day comes where the property would roll, would be empty and roll back to you? Correct. How much is the house worth?

1:08:06George Kamel:I mean, on realtor.com, it's about$400 ,000.

1:08:11Jade Warshaw:Okay. Before I ask you if you have the ability to do this financially, how much is her social security and how much does she pull in from the rent?

1:08:22George Kamel:So she pulls in about$2 ,000 a month for the rent, so$1 ,000 per studio. And her social security is about$1 ,000 a month. Okay. And she's able to cover all of her bills? She is. Okay, so why do we need even more if she's doing fine? Well, just because she only has$50 ,000. No 401k, just$50 ,000 in a savings account.

1:08:49Jade Warshaw:What's she going to use the extra money on if she's living life? Increase her lifestyle?

1:08:55George Kamel:Exactly, to be able to enjoy retirement and be able to travel. That's what she does. She just likes to travel. Understood. I feel like at this point you feel responsible for her lack of retirement. Well, it's a way for me to, you know, get back to her. And not necessarily responsible, but I have a couple of rental properties. And so I'm just in a position where I can... How much money do you have? In some way, I've got about 300 cash. Okay, so you couldn't afford it in full right now anyways. Well, I could, but my idea would be to— Take on a mortgage? No, if it's worth$400, my proposal would be to do it like a$300 and be responsible for taxes, insurance, and all that.

1:09:54George Kamel:That feels messy. So you want her to give you a 25 % discount? Well, you know, we haven't really discussed numbers. And honestly, I could pull the$400 if need be.

1:10:09Jade Warshaw:But that's all your money. I mean, is that all? I mean, when George asked you how much cash do you have, and you said$300, is that all your money, all your cash that you have?

1:10:20George Kamel:No, no. No, it's just the liquid cash that I have. Give us a full snapshot.

1:10:26Jade Warshaw:Give us a full snapshot. Tell us how much debt you have. Tell us about your, give us a bigger piece of this so we can understand. How many properties do you have? How much cash do you have? What's in your retirement? Yeah.

1:10:37George Kamel:So, you know, my home is paid off. And then I have two rental properties that are also paid off.

1:10:43Jade Warshaw:Okay.

1:10:44George Kamel:And then liquid cash in the bank is$300. Okay. And then I've got a couple liquid accounts that are$200 ,000. Okay. All in all, liquid cash and a couple accounts that are pretty liquid is$500 ,000. Wouldn't it be cheaper just to, if you want to bless her, cover the taxes and insurance on that house instead of you buying it? That was my, well, I mean, paying taxes and that wouldn't really help her or afford her to be able to travel how she wants to. But she can't afford it is my fear. And right now it's sort of you're artificially propping up her life. Who knows how long? She could live another 30 years, right?

1:11:32George Kamel:She's in good health.

1:11:33Jade Warshaw:Or if the renters don't want to live there anymore, right?

1:11:37George Kamel:Well, if she blows through that money. And then what? That's another concern I have, yeah. And so these are all real. She might be resentful. I would rather you give her$10 ,000 a year to go travel. That would be a cheaper option with less mess than you buying this house, but she gets the rental money and it's kind of in your name, but she's still living there. And then what if you need to sell it one day for whatever reason? Now you go to evict your elderly mother. I just think it's just too messy to get involved at this stage. Yeah, I just personally wouldn't do it.

1:12:07Jade Warshaw:She doesn't need the money.

1:12:09George Kamel:And if she wants to travel, she might need to go make some, you know, do a part-time job in order to come up with the money.

1:12:14Jade Warshaw:Or if she wanted to downsize and sell this home and buy a smaller apartment or, Or, you know, there's options here that I think she has that she may not want to do, nor really need to do at this point. But I have a feeling that you stepping in and trying to do this is just going to lead to more problems down the line. And for that reason, I agree with George. I'd rather spot her some cash as a gift, maybe here or there for a trip if you want to do that. But she's got options here. She's sitting on a nice piece of property that she's paid for over the course of years. so unless somebody did that for her that lets me know she's got some wherewithal on being able to

1:12:53George Kamel:handle her money right yeah yeah those those were those were my hesitations as well as would you be it does sound pretty messy would you inherit the property solely i have three i have three sisters and uh kind of talking to them about this idea they were um at first they were not so happy with it because they were going to get a piece of that upon inheritance and now they don't they'll get a piece of whatever's left of mom's pile of money which will likely be gone if she's traveling the world for the next you know several decades and the truth is here i mean

1:13:32Jade Warshaw:the hard part with this is we all have a picture of what we want for our loved ones all of us do and sometimes that's just not the reality and there may be i mean i this sounds harsh, but it's just, it's just, I'm just being a realist right here. She may not get to travel as much as she wants to. Her life, her life and her lifestyle does not afford that to her. And all of us face that every single day. I, there's things I would love to do right now, but I can't afford to do it. So I will either have to change something about my financial situation. I'll either have to wait. I'll either have to save up.

1:14:08Jade Warshaw:I'll either have to, right. And so there's part of that that rather than make something very messy because we want to have a picture so badly there's part of it of just saying well this is the reality of life for everyone to some extent and it's maybe not here for me to try to clean up and make perfect. Yeah.

1:14:30George Kamel:What if there was a compromise? Does she want to travel solo or is she like experiences with other people or family? Both ways. Whenever we take a cruise, we bring her along. But she does also like to travel solo to South America and Central America kind of thing. That's cool. I'm wondering if there's a compromise here. I'm wondering if you go, hey, Mom, once a year, I'd love to take a fun trip with you. You get to decide where we go. Here's the budget. So now she gets to live that dream without you being intermingled with the finances and Mom's a tenant now. I like that plan better because I can tell you're a noble guy.

1:15:05George Kamel:You're a great son. You want to bless your mom. You want her to have a great life. But I don't think artificially funding it by buying her house when she could sell it for more is the move. I just think there's going to be too much dysfunction in the family if you make this happen.

1:15:18Jade Warshaw:I agree with that. As long as you put really strong and clear boundaries and very clear expectations, if you do decide to do these trips, you've got to be so clear with that. Otherwise, next thing you know, it's like, but I want to go to the Bahamas. because I wasn't part of the deal, mom.

1:16:05Jade Warshaw:The Ramsey Show question of the day is brought to you by Y-Refi. When your private student loans are in default, your progress stalls out. Y-Refi helps you restart the refinancing defaulted private student loans into a low fixed rate payment that fits your budget so you can stop spinning your wheels. Visit Y-Refi.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. Remember, it may not be available in all states.

1:16:32George Kamel:Today's question comes from Shelby in Indiana. I have two children under five years old who are beginning to get invited to birthday parties for kids in their playgroups and daycare. This can get pretty expensive depending on how many parties are scheduled, and it's hard for me to justify spending a lot of money for children we're not especially close to. Do you recommend capping it out at a certain amount to spend per birthday, or should I look at this as an opportunity to be an example of having a giving heart to my kids? well let me know much more information i want here yeah uh number one i don't know her financial picture now if she's in baby step two drowning in debt it looks like a lot of hey wish we could make it or a real simple gift that the kids make it can be it doesn't have to be a 15 gift because the truth is under five years old they're about as excited about a cardboard box as they are about

1:17:23Jade Warshaw:thing in the box yeah i mean i those little matchbox cars oh i love you know or even the ones from the movie cars but those are like two two dollars like they're not six dollars like they're not expensive yeah i would i would if you're in debt if you're in baby step two i would for sure cap the amount of birthday parties that we're going to and i would cap the amount that we're spending and it's just like you said something small a five dollar gift i think that you could do that and that way your five-year-old is not feeling like you know i missed isabella's

1:17:55George Kamel:birthday party yes and i will say these birthdays have gotten out of hand they have it used to be simple like i remember it was just like come over we're gonna get a few pizzas now it's like you got to get like a white bounce house it's gonna be like a progressive dinner it's out of control i'm going to one jade for my two-year-old daughter got a kid in her little daycare and there's a full

1:18:16Jade Warshaw:on pettings it with exotic animals you want to know where i come from i come from the roller rink george that's what i'm talking about the sticky carpet questionable individuals bad pizza like 10 bucks for unlimited skating okay take me back to that but yeah this business don't get caught up

1:18:32George Kamel:is what we're saying i would cap it um just out of principle i don't think kids need expensive birthdays i think they need stable parents so unless this is a kid that they're really close to and maybe the kid chips in if they want to go to all these birthdays we're all right you're going to do these chores get a little commission yes and you can use your own money to buy whatever toy you deem fit i love that they'll feel the pain they'll go you know what uh maybe i don't need

1:18:55Jade Warshaw:to get that 20 toy can i tell you something else i've adopted what's that now hopefully this doesn't get this is gonna go viral all right here's what you do however whatever age they are that's the money that you put in the card oh and it's cute so it's cutesy if they're three years old you put three crisp dollar bills in the card if they're four years old. And that way it's like, it's thoughtful because you're thinking about, I know how old you are. I went to the bank and I got four crisp bills. That's effort. So there's effort there. And it's very like, if you're an auntie or an uncle or whatever, it's just a very cool way to send it in the mail.

1:19:34Jade Warshaw:Or if it's a buddy's birthday and it's kind of like, this is, this is what their family does. Like this is what the Warshaws do or this is what you're I love that idea because it's thoughtful but it's not breaking the bank they're three years old they don't need well my favorite part is it doesn't add to the

1:19:48George Kamel:clutter it doesn't add how many toys these kids have yeah and then on the way home they'll stop

1:19:52Jade Warshaw:and they'll get a fun drink or they'll get a yeah you know stop through the drive you know what I

1:19:56George Kamel:really like that plan and kids love money it's like magic to them they do they think it's a million dollars if you get a kid five dollar bill oh you gotta do when you do the magic trick when

1:20:05Jade Warshaw:you pull the quarter out from your ear. Yes.

1:20:07George Kamel:Listen, dropping like flies. I like that. I would go for creativity. I would set a cap on a budget because that is teaching your kids a whole lot more. Absolutely. We don't just unlimited do whatever we want, no matter the cost. We make a plan and we stick to it.

1:20:19Jade Warshaw:Like that. All right. Let's go to Savannah who is in Milwaukee, Wisconsin. Savannah, you are on the line, my friend. Hi, Jade and George. How are you doing today? Excellent.

1:20:29George Kamel:How can we help? Thank you. All right. I'll make this really quick. So I have a son who was in high school and he has a vehicle that I purchased for him and he is responsible for some of the car expenses. And here's where my question comes in. He was in a car accident that was pretty hefty. The repairs was about$3 ,000. He did borrow$450 from me and did repay me back after about two months. And here's where my question comes in because I'm really struggling with this every day. As soon as he handed me the money and it got to my hands, I felt so guilty. My first thought was this$450 meant more to him than me.

1:21:09George Kamel:And I'm really struggling with this feeling. Did I handle this correctly?

1:21:14Jade Warshaw:I understand why you did what you did. Like, I understand your heart behind it. It sounded like you wanted him to have some skin in the game and to have some responsibility in what took place. The part where I think you may have gone wrong is you caused him to engage in his first like debt. Like I owe my mom. And now what you guys experienced is kind of like the borrower slave to the lender.

1:21:39George Kamel:It changes the relationship.

1:21:41Jade Warshaw:That's exactly what I felt. That's exactly what I felt.

1:21:44George Kamel:And I thought it was a great lesson. Life costs money and you got to be prepared. And it's not always, you're not always going to get bailed out. It's not the first time he's going to have a$450 bill. And so it's a good learning lesson. and you can even have the conversation, hey, the way I approach this, I wish I would have done things differently. I wish I didn't say you owe me this money, but we had to do what we had to do. And what I do want you to take away from this is emergencies are going to happen and it's very wise to be prepared to have the savings in the bank. And maybe you put this money in a college fund for him and it becomes a gift and you surprise him.

1:22:21Jade Warshaw:Now, didn't you say it was 3 ,000 in repairs?

1:22:25George Kamel:It was. So you covered the difference? No, he did. Oh. I gave him some money for Christmas time toward it, I think about$300. But no, my hardworking son paid for it. Way to go. So he was just short a few hundred bucks, and you said, hey, I'll cover that. You can pay me back. Correct. Uh-huh.

1:22:47Jade Warshaw:Yeah, maybe.

1:22:50George Kamel:And he didn't ask for the money? He did. No, he did. He said, hey, I'm sure. He said, I don't have enough.

1:22:57Jade Warshaw:Got it. And you can think about this. What I might do, because I tend to think that some of these lessons stick. When a parent makes what they feel to be a mistake and they go back to their children and make it right, that really sticks. And I think it's something that is so good for parents to do for our own hearts, but also for our kids to learn that it's okay to make mistakes. I might go back to him and I might say, you know what? I didn't practice something that I believe in, which is I don't borrow money and I don't engage in debt. And I'm sorry that I put you in that situation. The best time to give people money is if it's a gift.

1:23:37Jade Warshaw:And so if I was going to give you this$450, it should have been a gift. And that's on me. And I might give him the money back.

1:23:44George Kamel:Okay.

1:23:45Jade Warshaw:And he'll always remember that. Yeah. And he'll remember that as a lesson. We don't borrow money. We give money.

1:23:54George Kamel:Yeah, that's exactly what I thought after the whole thing happened. But I wanted to see another perspective of it. You know, should I return it back? Yeah. Where I was thinking.

1:24:04Jade Warshaw:You're a great parent. Like the fact that you're even mulling over this is I mean, it's pure gold. Like whatever whatever you decide to do, like you'll be a winner.

1:24:13George Kamel:But a quote unquote bad mom is not even having this conversation. Exactly. I release you of the mom guilt officially, Savannah, as if you needed that from me. Right. No, you're incredible. You're doing a great job raising this young man. And I think this is maturity building. I think so, too. Character building. It's not punishment. You're not doing anything cruel. No. Things happen. A kid's going to wreck a car.

1:24:34Jade Warshaw:Yeah. And by the way, don't you feel any guilt over it, you know? I think just being a parent is making mistakes daily. Like, that's the way I feel about it.

1:24:45George Kamel:You know when you grow up and you're like, oh, my parents were just figuring it out.

1:24:48Jade Warshaw:Bro, I feel, yes. Because now I'm in that stage. Absolutely.

1:24:51George Kamel:And they look at you like you have all the answers. And you're like, I don't know, I Googled it. Yeah. Oh, yeah. At least we have Google now. I don't know what our parents did.

1:24:57Jade Warshaw:They just followed their instincts. And I actually think that that might be a little bit better. Because I feel actually bad saying, yeah, I Googled what to do. I overrode my instincts and instead I Googled it. AI is now raising our kids. That's a frightening thought. Oh, boy, oh, boy. But the point is, I think that as parents, when we make a mistake, it's OK to go back and correct it specifically when it comes to money, because then they understand this is trial and error for everybody. And if you make an error, you can always go back and make it right again. And I tend to think that those lessons stick the most when you're a kid and as an adult.

1:25:33George Kamel:Yeah. You don't always rescue them because that creates dependence. And so instead you give them some responsibility, that's going to build some strength. So don't remove the consequences. Your job is to raise a capable adult. Not a child who doesn't know any better.

1:26:06Jade Warshaw:Well, welcome back to The Ramsey Show here in the Fair Ones Credit Union studio. Let's go back to the phone lines, George, shall we? I'm in. All right, Greg is in Texas. Greg, you are on the line, my friend.

1:26:18George Kamel:Thank you all for having me.

1:26:19Jade Warshaw:You bet. How can we help today? Well, I am recently engaged, and we are extremely excited about that.

1:26:31George Kamel:We have, I've listened to y 'all for years, and I've talked with her about budget. I've talked with her about our finances. We've gone back and forth. and we agree on just about everything. However, there's one thing where I'm having a bit of a moral quandary. We both own our own homes and the plan is to sell my house and move in to hers. Okay. Which I'm comfortable doing. She wants to do some repairs but ultimately she doesn't want me on the deed to her house. Like ever? of this current home. She has witnessed her mom go through several divorces and struggle with home ownership. So worst case scenario, she wants to make sure that she has this paid for home.

1:27:25She doesn't, she has a mortgage on it currently, but she agrees with me to get out of debt and

1:27:31George Kamel:kind of snowball through everything and work the baby steps. And that's fantastic, but she doesn't want me on the deed. So she trusts you, but only to a point. Pretty much. Okay. And there is a mortgage you're saying, but she's wanting to pay it off. Well, she wants us to move forward and pay it off. Now I have a unique opportunity. I'm about to, the business that I work for is about, is possibly going to sell. And my proceeds from that will be about a half a million dollars in cash. Amazing.

1:28:03Jade Warshaw:That's awesome. So thank you.

1:28:06George Kamel:and it's a boon for me. I've never had that kind of cash before. Yeah. And my question is, do we just work the baby steps and I act like that money is set aside and it's investments and other things or do I try to attack the debt and get out of debt as soon as possible?

1:28:25Jade Warshaw:I mean, there's two things here. I'm of the mind, yes, if you guys are married, your finances should be together. If you have the extra money to do things like pay off mortgages, I'm all for that. But before we even get to that, I do want to go back to your wife because on the bigger scale, you being on the deed, we can make the argument of, hey, you're married after a certain point. If anything happens, the house is going to pass to you anyway, blah, blah, blah. But what we're really seeing is it is a trust issue and it is due to something that she experienced, which is completely valid. And I want to say that to her and really anyone listening, of course, our past and our past relationships and what we saw growing up, all of that informs how we view money.

1:29:10Jade Warshaw:And so, yeah, when you get experts like George or I giving you a simple piece of advice, everybody's going to filter that differently through what they've experienced. And some people are going to go, yeah, that makes sense. No problem. And other people are going to go, whoa, absolutely not. I can't. And so what she needs to understand is it's very easy for a good excuse or a good reason even to become a bad excuse. If she allows that to persist and doesn't get the help that she needs to process through that, it's going to keep her from having the marriage that she ultimately wants. Before we get off the show, I'm going to give you a copy of my book, What No One Tells You About Money, because I think that's really going to help her process those emotions around what's going on so that you guys can have the best possible financial picture and best possible marriage in this whole thing.

1:29:56Jade Warshaw:So that's thing one. Do you think she'd read the book if you gave it to her? I do. Okay. Do you think it's something that she wants to work through?

1:30:09George Kamel:I think through our continued conversations She might be waning on it I'm not sure Well you don't seem like a gold digger Greg You're about to acquire a half million on top of whatever else you currently have

1:30:20Jade Warshaw:And you want to put it towards her house Which is awesome

1:30:23George Kamel:So is she not going to get a dime of anything you're bringing into the marriage? Because that's what it's turning into No I believe in joint finances My parents they operated that way their entire lives. But you would agree it's unfair that you bring all this into the marriage, you help pay down the mortgage in the future once you're married, and you have no claim to the house on paper. That's what I'm saying. Am I being a butt? No. If you ask her, hey, if you were in my situation, how would you feel about all this?

1:30:54Jade Warshaw:You're not being a butt at all, but I do think this is an opportunity for you to understand her a little bit more, and I think you both have opportunities here. What George is saying is absolutely right. It's not fair. Like you're in a situation where you're thinking, hey, like, hello. But again, back to the first point, you saw parents who managed money just fine, right? So of course that informs the way you view this. You're like, yeah, what's the big deal? Understanding her who is going to be your wife, that is going to set you free in so many areas if you approach this from that. Not I'm gonna do whatever you say because what you're saying is broken, but I do wanna understand where that's coming from.

1:31:32Jade Warshaw:and I want to be an active participant in us working through that and getting to a point where it's as healthy as it possibly can be. Right. And I think if you approach it that way, she's going to put like her eyes are going to turn into hearts and she's going to love you for that.

1:31:47George Kamel:If you really dig into this, because she is operating out of fear. The most loving thing you can do is get to the root of that and build the trust with her that her fear is valid, but the outcome is not something that is a possibility. Because I'm guessing there was a very specific reason her mom got divorced or multiple. I don't know the story, right? And do you know the reasons behind it? Have you asked her about that? Yes, we've talked about it. And was it financial? Was it infidelity? What was at the core of those? Several different. Two of those already, yes. I would say infidelity and financial.

1:32:22George Kamel:Okay. And so the sooner we can be aligned with our money values and our principles and we say, hey, this is how we're going to operate as a family. You guys are already light years beyond probably where her mom was. Yeah. Right. Relationally, financially. And so that's, I think some good premarital counseling is necessary before you guys move forward on this. I don't know that this is like going to be an ultimatum or deal breaker for you, but I think the spirit of this puts a little pause in my book.

1:32:49Jade Warshaw:Yeah, absolutely. This is something you guys are, have the, look, it really is an opportunity for you guys to work through this and how great that this is popping up now before you're even married versus on down the line when you're all set in your ways. So I think if you both can look at it that way, I think that is a winning combination there. So thank you for that call.

1:33:10George Kamel:That's a tough one.

1:33:11Jade Warshaw:It is a tough one, George. And that is the truth. These conversations, obviously, we make no bones about it here that money should be a joint effort if you are married. It should be combined. And what we mean by that is there's one checking account, both checks goes in there, and there's no side accounts that is like, well, I put the money for the mortgage in here and I keep my money. No, both checks go in and both people are aware of the monies. Both people are on the budget. If there are assets, both people are on those assets. And it's very easy to say that from a healthy perspective, but anybody who's been burned hears that and goes, oh, H, no.

1:33:54Jade Warshaw:Don't listen to them. Yeah. Don't listen to them. Protect yourself. And that, like, human nature is to protect yourself.

1:34:00George Kamel:But I mean, part of marriage is letting go. Yes. You're risking something in order to be married in this financial merger.

1:34:06Jade Warshaw:That's right.

1:34:06George Kamel:So think about it like mergers and acquisitions, right? Except you are acquiring everything she's got and she's acquiring everything you got. So romantic, George. And it can't work without that. If you're like, well, I want to keep my toys over here, but I want to play with your toys over there. That's not marriage. Doesn't work. That's just fancy roommates. And if you're splitting the bill with your spouse, you don't have a spouse. You have a roommate with benefits. Ooh. I'm calling it like I see it. Got him.

1:35:10George Kamel:We'll see you next time. marketing, writing, copy editing, and creative roles. Check out all our job postings at RamseySolutions.com slash careers. That's RamseySolutions.com slash careers.

1:35:36Jade Warshaw:All right, back to the phone lines. We go where Melanie is in Minneapolis, Minnesota. Melanie, you are on the line.

1:35:43George Kamel:Hello, thank you so much for taking my call. I have a question that would be in the category of radical generosity. And my question is twofold. I want to give a very generous gift to my sister-in-law and her husband and their two best friends. And my question is twofold. First, I need to make sure that my husband is on board. He says it is excessive. And second, if I can't get him on board, how do I get this gift to them without making it weird in our relationship?

1:36:13Jade Warshaw:What's the gift? And what's it for?

1:36:16George Kamel:We want to send the four of them to Hawaii, or I do anyway. Why? Well, they have experienced some health issues, both somebody and each of the couples. My sister-in-law is on the other side of cancer, and the husband of the other couple has had his own health issues, and he's working his way out of that. My in-laws, they planned on doing this trip together when they were counting on an inheritance that they were going to get, and that fell through, so they no longer are going to be getting that money. We have the means to send the four of them, And I would like to pay for the resorts, the excursions and all, and maybe say you guys get yourself there with the flights and we'll take care of everything else.

1:37:05Jade Warshaw:I love that. How wealthy are you?

1:37:08George Kamel:Well, I mean, we're fine. So we've retired and I have a pension that is covering all of our needs and we have 2.1 in different types of savings and we have our house paid for and we're taking our own trips that we're kind of living what we wanted to do in our own retirement. And we would really like to.

1:37:31Jade Warshaw:What will it cost to do all this for your friends and family?

1:37:35George Kamel:I think$25 ,000 would cover it, and I have$27 ,000 coming in July for our early retirement bonus that will be coming in. Nice. So this feels like found money. Yes. Yeah. And I just feel like it's one of those where Dave says if you could put it in the middle of the table and burn it, you wouldn't even notice it. I feel like it's that category. Yeah, this isn't even like a percent of your net worth. No. It's like a percent of a percent of your net worth. Right. I just love your heart on it, too. And is it just, is your husband, like, blindsided by this? Like, is this a big surprise that you're like, hey, what if we drop$25 ,000 to send all of these people?

1:38:15George Kamel:Like, you're not even going on the trip. So he's like, I want to go to Hawaii. Well, we're going in September. Okay, good. It's not like we don't ever do anything. We went to Greece, and so we had some really great trips planned for ourselves. He does kind of give me a hard time because he's like, oh, my gosh, you'd give away the house if he didn't put bumpers on the. Well, there's usually one person who has a little more of that generosity muscle and one person who's a little more like saver. What else could we do with the money? And that's totally normal. I don't think he's a bad guy. Have you gotten to the root of what he's feeling about this?

1:38:50George Kamel:I do think that he's concerned with maybe what would happen. How do you say we would like to gift this to you? And could that be a problem? I don't want to make it weird because we are very close. yeah and i don't think it's weird knowing the context it's not like you're saying hey you guys are so broke we just want to send you on a trip it's hey you guys have had a lot of life hit you and you know my husband and i we were trying to brainstorm things we could do and we just thought the most fun thing to do would be to send you guys on a trip and we'll cover blah blah blah you guys cover the travel yeah you know that's what we decided and it's more of just like it's up to them if they want to block the blessing but it's not you guys making it weird and i also love

1:39:33Jade Warshaw:that you're sending them. It's not like we're going with you. And then the whole time it's kind of like, all right.

1:39:38George Kamel:This awkward force, like, thank you so much for everything.

1:39:41Jade Warshaw:Now are the couples going together or it's like the in-laws are going on the trip and then your two best friends are going on a separate trip? Or is it like a group of them going together? It's their two best friends. So it's our in-laws and their best friends. Okay. So the four are together. Is he worried that it feels excessive because that's clearly a lot of people, a long distance, a lot of money? Like, is he afraid it's going to reveal something about you all's net worth?

1:40:04George Kamel:Or that it's going to feel like a flex? I think so. And, you know, we've kind of grew up in a generation where nobody talks about money. And, you know, you don't... Okay. If there's income inequality, you know, I don't want that to be... Yeah. I hear that. Something that will come between us. I hear that. Well, the other question I had is, are they even going to be able to cover the other expenses? Are they in a good financial spot? I think so. you know I they you know they they don't seem to be hurting for money but they definitely live furtively at the same time you know but but they you know we've done things together and it's not like they're complaining about money they've been generous to their sons before on different occasions so they're not like drowning in debt tight how would you do it I don't know Is it writing a check or is it like practically how would you do this?

1:40:57George Kamel:I hadn't thought that far because I hadn't gotten to the whether or not we should do it or could do it yet. Open to ideas.

1:41:06Jade Warshaw:Yeah. Let me first say this. I love the idea of being generous. I love that you've seen that they've gone through a struggle and they could probably use a break. I love that so much.

1:41:15George Kamel:This is the live like no one else part of live like no one else so later you can live and give like no one else. You guys are doing that last part, which is highly encouraged, and it's the most fun you can have with money. And so there's multiple ways to do it. I think that's less exciting and more just like, all right, we're going to give them the debit card number when they go to book. It's not like it's rocket science to pay for the trip.

1:41:37Jade Warshaw:Yeah, but it's like it feels different to be like, here's your check for$15 ,000 versus kind of what George said.

1:41:44George Kamel:Yeah, I would try to do it directly to the trip. Otherwise, it's like, well, we can get a lot of groceries with this money now. Right. Maybe the trip will get delayed. I do have a friend that's a travel agent that is planning our trips. Oh, nice. She could plan it and I could just pay her.

1:41:58Jade Warshaw:I love that. And I think that that also gives them the ability to choose when it's a good time for them. So if you said something like, I don't know, you sit them down and you say, hey, we really want to do this for you. We love you guys so much. You deserve a break. I asked my travel agent if she would plan this for you guys. It's a total gift. So whenever you're ready, you know. Get in touch. Yes. but please like do this do not you know and make sure i i love that because then you're dealing

1:42:24George Kamel:with a travel agent yeah yeah it's less awkward because you don't feel like you're directly involved in this you're just sort of the the you know fairy angel yeah and and maybe you let them

1:42:34Jade Warshaw:know you know here's here's what we're giving you know feel free to get what you want but like my husband and i we want to put like x amount of dollars towards this and that way you've kind of said it but it's not uh in a weird way yeah and if they decline it and go hey you know we're

1:42:49George Kamel:actually not going to be able to take a trip this year for whatever next reason that's okay you still offered it you were still generous and you didn't just like write a check that sat there and you

1:42:56Jade Warshaw:have to rip it up now now on your husband's part okay that that's the one that's going to be tough and i'll tell you you know my husband and i are to george's point there's always one person that's like give it all and the other person's like hold up like chill out for a second like let's talk um so maybe ask him say hey if this feels too elaborate what what what do you think and maybe you guys can meet in the middle. Maybe it's somewhere in between all of this that feels more right for both of you. And just be open to that as well. Okay. Okay.

1:43:30George Kamel:That sounds great.

1:43:31Jade Warshaw:I really appreciate your help. Yeah, no problem. You're an awesome person. Yeah, thank you for the call.

1:43:34George Kamel:I do think the ratios help me emotionally because I'm probably more like her husband where like the sticker shock, I just go, that just feels crazy.

1:43:41Jade Warshaw:That's like Sam Warshaw.

1:43:42George Kamel:Yeah. And then you go, well, it's 0.02 % of our total net worth, and we're going to make that much in compound growth this month. Yes. Oh, and also, it's a bonus that she's getting from her early retirement.

1:43:54Jade Warshaw:Yeah, it's found money in many ways.

1:43:56George Kamel:Yeah, that's girl math right there.

1:43:58Jade Warshaw:So, okay, I don't know what you and Whitney do, but whenever there's a moment where we're thinking about giving an amount, this is my strategy. I always say to Sam, I'm like, okay, be praying about what this amount is.

1:44:10George Kamel:Oh, that's good.

1:44:11Jade Warshaw:That's the first thing.

1:44:12George Kamel:Be praying. Be praying about it. There's some spiritual conviction right there.

1:44:15Jade Warshaw:It's just like, hey, I want to know that we both allowed, you know, the Lord. Well, then it's like, hey, it's up to God. It's up to God. Whatever he puts on my heart. Then what I do, then what we do is we count to three and we say our number at the same time. I love that. And it is always.

1:44:30George Kamel:You're hired.

1:44:32Jade Warshaw:It is always hilarious. And then he'll go, I knew you were going to say that. And I'm like, then why didn't you say the same number as me?

1:44:38George Kamel:He likes to be contrarian.

1:44:40Jade Warshaw:Yeah. So let's do it, George. on this trip, the$25 ,000 that she wants to spend on the count of three, I'll tell you what I think she should spend and you tell me what you think she should spend. All right, you ready? Yep. One, two, three. $25 ,000. Boom.

1:44:58George Kamel:God told me.

1:44:59Jade Warshaw:God told me too.

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1:46:18Jade Warshaw:Richard is in Nashville, Tennessee. Richard, how can we help today?

1:46:23George Kamel:Hey, question for you. I'm considering building an apartment on my property for my daughter and son-in-law to live in until they can purchase a home. They'll pay rent while they're living there. and my two options I think that are good for me is a HELOC or I can do an auto loan on a vehicle that's paid off probably looking at about 50 ,000 on the HELOC and can probably get about 40 on the car I do have the cash on hand but I think a loan would probably be a better idea I'm just just curious if there's any pros or cons one way or the other well there's all cons okay all of them why would it be a good idea to do the title loan or the heloc well because if i used cash on hand i'd not have any cash on hand anymore and i've got a ton of equity in my home and um i i owe nothing uh any the only thing i owe on is my home as far as you know in debt with anything um i don't know maybe it's not a good idea that's what i'm curious Well, if it's a true title loan, I mean, it's like a payday lender.

1:47:33George Kamel:It's like 25 % to 300 % interest. You could lose the car. I mean, the repayment terms are terrible. And you have to pay back in 30 days. Unless you're talking about taking a loan out against your car that's paid for? Well, this is through the bank, and it's basically a reverse. Your car is collateral, though. Yeah, the car is collateral. I'd rather lose a car than a house, though. Why lose any?

1:47:57Jade Warshaw:What's so urgent about this? Why can't they just get a normal apartment? Why do you have to build an apartment for them to live in? Tell us more.

1:48:05George Kamel:Yeah, well, both of them work ministry, and they're coming out of that. And so they're not financially set to do that. The apartment would be an asset to my current situation. I had considered doing it before because about two years ago, my father became ill. All of a sudden had to come live with us. We just bought an RV and let him live in the RV for a time. And so it just kind of put on the radar, maybe we should have something like that available. But what's the long-term plan for them? It feels like we're just sort of temporarily subsidizing their lifestyle because they're not making good incomes.

1:48:53George Kamel:yeah so if they're going to be in ministry long term they got to figure out how to put food on the table and cover rent no i agree with you on that and so i'm just wondering if i could help

1:49:02Jade Warshaw:with that i mean well here's the thing i just don't think you can afford it i i'm always uh the last call the lady wanted to be like wildly generous so we love generosity here um hear me say that but if you have to put your home up and your vehicle up for collateral and you're still paying off a mortgage yourself, you simply can't afford to do so. You're, you know, cutting off your nose to spite your face at that point. It's putting you in a horrible situation and it's putting them in a bad situation because if this goes south in any way, you are going, you have a lot on the line that you can lose.

1:49:40Sure.

1:49:41George Kamel:Yeah. There's just too much risk here. If you want to bless them with like a one-time gift, you can do that. You can write them a check and maybe that covers a certain, you know, number of months of rent for them. But again, I would try to help them actually become independent long-term because otherwise now they need you. Now they're codependent instead of independent. And ministry is tough because you don't make a lot of money. It's why we call it ministry. But they need to figure out a way, either it's bivocational, which is a lot of people in ministry, it's what they do. They have another job that actually pays the bills and they do ministry with their free time.

1:50:16George Kamel:And so I think helping them craft a plan is so much more helpful than anything you could do financially for them at this point. Okay. Well, that's helpful insight. It certainly gives me a perspective to mull over and think about. And that was my objective and calling to find out, you know, am I missing something? Is there a red flag that I'm just not seen. So I appreciate your input with all that. Absolutely. You're trying to do it just a nice, good thing in a bad way. And then you're trying to justify it by saying, well, I'm also building an asset for me on the side. And so I think that's sort of clouding the judgment here because you're looking at it as an investment.

1:50:59George Kamel:But if you have to go into debt for it and put your car or home at risk, which is what's happening with either of these loans, it's a bad idea. And if it hurts to part with that much cash because you'll be cash poor, then it's also a bad idea. So I think it's a good gut check to say, if I paid cash for this, would it give me some pause and anxiety? And then the truth is, we just can't afford it right now. Not that you never can do something super generous.

1:51:22Jade Warshaw:Yeah, it's something to aspire to possibly.

1:51:24George Kamel:Yeah.

1:51:25Jade Warshaw:You know, and I think that's, hopefully you'll think long and hard about that. But please hear George and I say, we would not do this. And by the way, if you don't do this, it doesn't make you a bad person. It doesn't make you a person who doesn't support ministry. it just makes you a person who is a financially responsible adult. Okay, let's go to Sam, who's in Maryland. Hey, Sam, how can we help today?

1:51:49Jade Warshaw:Hi, thanks for taking my call. Can you hear me? Yeah, we can. What's up? So I'm a 25-year-old.

1:51:55George Kamel:I'm hoping to get married this year to my boyfriend. He's also 25. So I'm a two-year post-grad. I'm working full-time, and he's a full-time pharmacy student. So the question is that if we were to get married this fall or winter, essentially we would be financially independent. He's fortunate enough right now where his parents pay his pharmacy school tuition. Nice. If we chose to get married, that financial support would end because we'd be independent adults at that point. And that would be four semesters of tuition at around$17 ,000 per semester. Okay. So the question is, do we delay potentially getting married until after he graduates, or do we take the risk and take out student loans of a significant amount and get married sooner than later?

1:52:48George Kamel:Is there an option C? Because A and B suck right now. We can both agree on that. I would not take out student loans. I would not delay marriage until this is all sorted out because of his beneficiaries here. What I'm confused about is why the parents are saying, hey, the day you're married, no more. You're on your own, even though it's not like he has a job all of a sudden. Yeah, he doesn't. So both of us come from non-American families, and I think traditionally with both of our cultures, it's understood that you're essentially independent once you're married. So I don't think his parents are budging on that department.

1:53:26George Kamel:And I think they also, both of our parents are for the match. I think his parents would prefer waiting a little bit longer. Yeah, do they like you? Is this part of, like, is this to spite you? From what I've been told, I'm well liked and accepted. I don't think that's your concern there. Well, because here's the funny thing. If I'm him, I'm like, sweet, I guess I'll just never get married, because then my parents will fund my life forever. Do you also see how insane that is? Yeah, no, yeah, I get that. And what about as a wedding gift, they go, hey, as a wedding gift, we're going to cover the rest of his school, but you guys are on your own for the wedding.

1:54:04George Kamel:Would that be a compromise that they might be willing to go for? I'm not sure. I mean, I think maybe you'll have to talk to them a little bit more. But, again, in his culture, I'll just throw that under the bus. I think traditionally it would be my family paying for the wedding for the most part. and then we're also not thinking of something anything significant um i guess like we could ask about if there's a gift i'm not sure well what are you making i make sixty four thousand dollars a year okay so the question is on the other side how do we figure out how to cash flow the 17k a year if that's what it's going to take well it's it's a semester yeah exactly so we got 68K we got to cover if we're on our own over how many years?

1:54:54George Kamel:So he has two more full years, so four semesters total if we're beginning this fall. Yeah, so you're not going to be able to cash flow that making 64. Exactly. And so that – we run into a problem here, which means he needs to do this slower. You could delay getting married. I wouldn't delay getting married just for this purpose. But it sounds like he hasn't even proposed yet. And then there's still the engagement period. So there still could be another year, year and a half or two years.

1:55:21Jade Warshaw:That's the question I had is if the man hasn't even proposed, then maybe, you know, that buys you some time right there.

1:55:27George Kamel:Maybe we plan the wedding when he graduates, the wedding happens. Yeah, I like that. Best of both worlds.

1:55:32Jade Warshaw:Best of both worlds.

1:55:44Thank you.

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1:56:52Jade Warshaw:All right, our Ramsey Show scripture and quote of the day. Colossians 3.23 says, and whatever you do, do it heartily as unto the Lord and not to men. Merrick Twain said, 20 years from now, you will be more disappointed by the things that you didn't do than by the ones that you did do. I like that.

1:57:12George Kamel:Avoid regret.

1:57:13Jade Warshaw:Seize the day. Carpe diem. All right. Kate is in, Katie is in Huntsville, Alabama. Katie, you are on the line, my friend. Hi. Hi. Hi. I'm so pumped. So nervous, but so pumped. Love it. It's a good combo. Yes. We can't wait to hear what you have to say.

1:57:33George Kamel:Oh, man. There's so much, but we'll wrap it up. So currently right now, my husband and I are babysat number two. And we have about$12 ,000 in consumer debt that I am about to send a$6 ,000 payment on. So about to cut that in half. Yes. And I do. Yes, I'm so pumped. And then I'm expecting to have the remaining balance done by April. And I've been working like 25 hours extra every week trying to like pump out the overtime. And my husband, you know, unfortunately, overtime is not available for his job, but we are in full gazelle mode. Love it. Just running and feeling the passion. um however i am 41 and he's 45 and we have twin almost 15 year olds that are looking to get their permit um i have a car loan that is 40 000 and i'm currently 13 000 upside down on it what happened

1:58:43Jade Warshaw:you said you had 12k i'm confused sorry i forgot about the car that's a big one to forget about How can you forget about the car in Baby Step 2? I can't forget about the car. I can't forget about the car is the whole reason I'm calling. Okay. So$40 ,000 loan.

1:59:00George Kamel:$40 ,000 loan. And you're saying it's worth$27 ,000? Yeah. Yikes. Yeah, maybe$33 ,000 if I'm lucky. I might be able to get$33 ,000 for it. But in the end, I'm upside down,$13 ,000 on it, roughly. What's your household income? um my husband makes 93 and i make 54 great income yeah it's not terrible i mean we used to make better money but we moved and total god thing and this is where we're supposed to be so we're just trying to keep our eyes on that and and stay focused yeah it's like double the average household income so you guys are crushing it by you know america standards but when you're in crippling dead it doesn't feel like that so what's the main question so my main question is i got kiddos that i'm gonna need to get cars for uh is it because i i know dave says if you can pay the car off within two years then it's potentially a fault for keeping right so um do i keep the car or do I forgo the car because I got my kids potential driving coming up.

2:00:13George Kamel:And then I have one more wrench to throw in there. I'm currently living on folding tables in my kitchen because we bought a home that needed repairs and it ended up being a disaster. So I've been in a year in this house with no kitchen.

2:00:33Jade Warshaw:Oh boy.

2:00:33George Kamel:So on top of everything else, I'm surviving and it's fine. When you say folding tables.

2:00:41Jade Warshaw:I have no cabinets. I have no kitchen counters. You have a sink? I have a utility sink in my laundry room. Oh, girlfriend. I know. You're making salad in the bathtub. There's a porta potty in our back that we all use.

2:00:56George Kamel:It's a good time.

2:00:57Jade Warshaw:Okay, there's a lot. We did redo all of the plumbing.

2:01:00George Kamel:We did do all of the electrical because our inspection came back horrific. And actually, no, the inspection came back fine. So once we started going through things, everything had to be replaced. Everything was a fire hazard. Our plumbing was about to go.

2:01:14Jade Warshaw:Oh, boy. Okay.

2:01:15George Kamel:Is this going to be like$50 ,000 to get this thing up and running? No. So we've got most of it up and running. So we dug into our nest egg, which is half the reason we're in our current situation. Wait, you like robbed your retirement accounts? No, no, no, no.

2:01:32Jade Warshaw:Just the equity from our house that we sold in another state. Okay. Oh, okay. A secondary house. Yeah, we sold.

2:01:41George Kamel:We used to live in Colorado. We sold everything. This is like days of our lives.

2:01:48Jade Warshaw:It just keeps unfolding.

2:01:49George Kamel:The bad decisions keep going with you wherever you go.

2:01:52Jade Warshaw:You had a house in Colorado. You sold that. You had a sum of money and you've been pulling from that. yes how much was it and how much do you have left oh i don't have any left you know like i were down

2:02:04George Kamel:to our a thousand dollar emergency fund and we're slowly getting how much was it originally that

2:02:11Jade Warshaw:credit card oh i think it was like 50 okay so here's where we're here's where we're at so the forty thousand dollar card you just told me now you can't keep it um because of all the priorities Yes. And as it relates, and I'll just give you a couple of thoughts, even aside from the kitchen malfunctioning, I'm thinking, OK, 40 ,000 in this car. Surely you have another vehicle that's worth something. And then you've got these kids. We don't want more than half of your income in vehicles going down in value. So you're likely going to have to lower this because you've got about 60. You've got about 70 ,000 that you can spend on vehicles.

2:02:50Jade Warshaw:Right. So all four of you having vehicles, somebody's going to have to shift down.

2:02:55George Kamel:And it doesn't mean you should have 70 ,000 in vehicles. That's just the upper, upper, tip-top limit if you really want it. And right now—

2:03:01Jade Warshaw:And my husband's car is paid off.

2:03:03George Kamel:But what was it worth? We got his car paid off. It's a 2020 Chevy Silverado. That sounds expensive. It was. Exactly. We got it in COVID, but we got it during COVID. Besides the point. That's besides the point. But it's paid off.

2:03:19Jade Warshaw:But the point is we're going to go down to the credit union. We're getting some sort of loan to get out of this$13 ,000. And then because you owe 40 now. So if you take a loan for 13, 13 is less than 40. That's a better deal for you.

2:03:31George Kamel:Plus we need some cash to get you a car to get from A to B right now. Yeah.

2:03:34Jade Warshaw:So maybe try to get the loan for 18 and you spend 5 ,000 on a clunker. That's what I would do.

2:03:39George Kamel:And then give that to one of those kids that are driving because they're inevitably going to make it even more of a clunker.

2:03:44Jade Warshaw:Indeed.

2:03:45George Kamel:And then you can upgrade with cash once you guys have it. So that's up to you how you want to prioritize. Hey, we got to get a car for Junior. We need to get some cabinets in this kitchen. We got to clean up the other$6 ,000 of debt that you have left.

2:03:59Jade Warshaw:And if Junior has to wait a while for a car, by the way, he or she will be strong. It's okay. I shared my parents' cars for a long time.

2:04:07George Kamel:Yes, yes, absolutely.

2:04:09Jade Warshaw:Well, it's two of them. They're twins. That's okay. They can ride together. Get them a tandem bicycle.

2:04:14George Kamel:You know, that'll look cool going down the road as twins. Oh, gosh.

2:04:17Jade Warshaw:Yeah. Either way, if they have to wait for a while while mom and dad get their life squared away, that is fine. They will survive that. Absolutely. Now, the kitchen. Let's talk about finding the money. So how much? Did you say$50 ,000? How much is it going to cost to just get this in working order?

2:04:37George Kamel:Oh, the kitchen? We've already done almost everything except countertops and cabinets. That's like the expensive part. I know, but we've priced, and we're looking at about$7 ,500. Oh, that's not bad. No, I'm not a bougie girl, okay?

2:04:57Jade Warshaw:Sounds bougie, but I'm not. Okay, good. I'm not looking to make it crazy. Okay. Well, if you get rid of this car and you knock out the other$6 ,000,

2:05:08George Kamel:you can cash flow that$7 ,500 pretty quick and cash flow a couple of cheap cars as well. So this is all very doable. We just need to start putting things in order. and I think this getting rid of this car is going to give you such relief. And later on, you can get you a nice$30 ,000 car with cash. But right now it's sinking you guys.

2:05:26Jade Warshaw:Yeah. I mean, put it to you like this. By the end of summer, you'll be driving, your kids will be driving, and you'll have your – if you go hard in the paint, you'll have your kitchen done. And I think that's a great feeling. The one thing I will kind of throw out there because it's hard. Selling a vehicle, it is hard on the ego. okay because everybody knows something's up yeah you were driving and you go from the nicest car

2:05:53George Kamel:you've ever driven to the worst car you've ever driven overnight absolutely that's brutal because

2:05:58Jade Warshaw:people are like well hey what happened you know they're at chili's wondering what happened to bob and susan they solved their escalade my butt's cold but the good news is it doesn't matter what other people think you guys are far beyond that at this point if you're if you're gazelle intense That is one lesson that you have learned.

2:06:14George Kamel:If you've got real friends who have seen your kitchen, they won't care about your beater car. I'll tell you that much.

2:06:18Jade Warshaw:That's right. But for anybody who's doing this journey, just be prepared to not care what other people think is what we're telling you.

2:06:24George Kamel:It's a superpower.

2:06:25Jade Warshaw:All right. All right. Well, guys, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

2:06:42Thank you.