Panic Never Leads to Peace

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

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

11:07Dave Ramsey:Shea is with us in Canada. Hi, Shea. Welcome to the show. How can we help?

11:13Ken Coleman:Hi. Thanks for taking my call. Kind of a quick question, I hope. I can't use the premium version of EveryDollar because I'm waiting for you to drop it in Canada. But until then, I'm trying to manually use it.

11:27Dave Ramsey:Yeah, Canada. Canada's waiting for us to conform to crap we're not going to conform to. So it's not my fault. It's Canada's fault. But anyway.

11:35Ken Coleman:Oh, I believe it. I'm American, actually. I just live here. But so I have an emergency fund. I'm a single mom. And with my two kids, I try to keep a couple of sinking funds because, like, I have, like, an SOS fund, I call it. And it's about$1 ,000. And that's just for, like, a light emergency. and see, like, oh, my kid, you know, needs to go to the dentist or something, and it's going to cost me$600. So I have, like, that set aside. And then I have, like, a$500 thinking fund for, like, I call it kid crap. It's just kid stuff. Like, back to school, clothes, shoes. Both of these got used by the kids.

12:14Dave Ramsey:What happened? I'm confused.

12:17Ken Coleman:Well, they always need stuff. Yeah, why don't you just put that in a budget? I don't know, because I was trying to keep it separate. No, I'm just saying you need to put the kid crap in the budget.

12:27Dave Ramsey:That's part of operating your household.

12:29Ken Coleman:Okay, so not like a sinking fund.

12:31Dave Ramsey:You can have a sinking fund. You can have an emergency fund. But the kids should not be creating emergencies. You should have a predictable environment. They are so unpredictable. No, they're not. I raised three of them. They become very predictable when you start telling them, no, it's not in the budget because you didn't tell me about it.

12:50Ken Coleman:I know. But he loses a shoe, and then I'm short a shoe, and now I have to go pay$40 to get a pair of shoes. I feel like every week I'm getting slapped with something from them.

13:03Dave Ramsey:Kids' clothing has events like that, and that should be in your budget, hon.

13:08Ken Coleman:Okay.

13:08Dave Ramsey:That's not an emergency. A lost shoe is not an emergency.

13:12Ken Coleman:How do you budget for something that's so flexible like that?

13:16Dave Ramsey:you set aside an amount because throughout the year you're going to have a kid tear up a piece of clothing lose a piece of clothing lose a shoe that's part of having kids they forget stuff and leave it laying around and uh every weekend when the grandkids leave the lake house we have to load a bucket full of stuff they forgot to take home and i bring it back to the office and give it out to the different kids here so they kids just leave stuff i got i got crocs i got swimsuits i got sunglasses, I got all kinds of crap. And I'm bringing it all back every time. So they can leave it again the next weekend.

13:49Dave Ramsey:But I get you. But the point is, that's just part of the rhythm of life when you've got littles.

13:55Ken Coleman:Yeah. And that's where I'm feeling the pressure, because I feel like I'm living paycheck to paycheck. What do you make? About$6 ,000 take home.

14:07Dave Ramsey:A month?

14:08Ken Coleman:Yeah.

14:09Dave Ramsey:Okay. All right,$72 ,000 a year. All right. You ought to be able to live on that.

14:17Ken Coleman:Yeah, I live in an expensive city, so I have about$4 ,100 going out, and I'm trying to do the debt snowball. So then I feel like when I have to use money for the kids or a minor emergency, I never know how to put the money back.

14:34Dave Ramsey:So, again, one of the rules of your budget is your budget has to reflect reality, not what you wish reality is. And what you wish reality is is that the kid didn't tear up or lose pieces of clothing, but they do because they're kids. And so you're just going to have to say, all right, the kid's clothing budget includes some loss. Okay. And you're not budgeting enough for kid's clothes. And so you need to change your budget, and it reflects reality then. And also I'm going to come down on them if they're constantly losing stuff. I mean, if you're losing something expensive, like, you know, you lose a couple of, you know, one of two Air Jordans.

15:09Dave Ramsey:I mean, we're going to have a problem in this house. Okay, so.

15:12Ken Coleman:Yeah, we stop with it. There's no air georgia in this house.

15:15Dave Ramsey:I know, but I'm just saying, if they're doing something that's way irresponsible, they're being raised by a single mom, a warrior princess, and she's trying to get jobs done so they can conform and have a little bit more discipline and be a little bit more responsible, too. That's okay to call them out on that. But overall, it sounds like you're just not reflecting the reality of your life and your budget. So here's an example we used to do, Shay, that was similar, and we had to correct it. That's how I know it. I was driving a car that had a pretty consistent pattern of needing repairs, but I was in denial about it.

15:49Dave Ramsey:And so the repairs always landed in the emergency column, and they weren't really emergencies. They were really predictable. And so what I did finally after I admitted to myself that that's what was going on is if I'm going to drive a car that breaks down, I'm going to have to have more in the car repair line item in my budget so that I don't get bit by this.

16:12Ken Coleman:Yeah, I mean, we have three kids, and the boys were growing rapidly. And so we had to sit down and adjust our budget, and we looked at, okay, what do we think the entire year, all three kids, what do we think we're going to put out for clothing? And it's a very simple process. You just got to try it and get it right, get it wrong, and then, you know, divide it by 12. And to Dave's point, you're putting that away so that's no longer stress for you. It's really simplifying. And right now it feels complex because you haven't allowed for it. So then something pops up and now it's creating stress. So simplifying, as Dave told you, is also going to take away that emotion that you're feeling like, oh, I can't keep up with this.

16:52Ken Coleman:When in all reality, you can.

16:54Dave Ramsey:Yeah, it's very doable. Sarah's in Milwaukee. Hi, Sarah. How are you?

16:59Ken Coleman:Hi, I'm doing great. How are you? Better than I deserve.

17:02Dave Ramsey:What's up?

17:04Ken Coleman:So I have been listening to your show for the last few weeks and really trying to sit down and think about next steps. And my husband and I just got married in January. We bought our home about a year ago. And just trying to figure out everything financially. Right now I have$10 ,000 in savings. and kind of just going through all my debt and kind of just saying, okay, what should I tackle first? What about retirement? Like, there's just so many questions, but really just what to battle first.

17:41Dave Ramsey:Okay. All right. How much debt do you guys have?

17:48Ken Coleman:So right now,$15 ,000 in credit card debt. $11 ,000 I still owe on my car. He does not owe anything on his. I have$30 ,000 left in student loans. Our home, we put$50 ,000 down, so we don't have any PMI, so we owe$170 ,000 on our home.

18:12Dave Ramsey:What's your household income?

18:14Ken Coleman:It is$140 ,000 combined right now.

18:17Dave Ramsey:Phenomenal. Way to go. You guys got a great start. Like you said, you've got to clean up some debt. So, Sarah, what we've been teaching for a long time to great success is the simple concept of the fastest way to become wealthy is to quit giving your money to everyone else in the form of debt. Your most powerful wealth-building tool is your income. And when you give it all away to student loans, credit cards, and car payments, you don't have any money to become wealthy with or to be generous with. Pretty simple math thing, okay? If you give your money away, you don't have as much. It's that simple, right?

18:55Dave Ramsey:So we've got to get rid of that blocker that's blocking you from becoming wealthy. You make a good income. You have the opportunity to join hands literally and figuratively and financially with the person you just married. So the two of you can sit down tonight and say we are going to together set some goals and we're going to attack this debt so that we can become wealthy, so that we can live like no one else, so that later we can live and give like no one else, so we can have a great life, in other words, okay? So all of that, that's the underlying premise. And then what we figured out is that people need an order to attack these things.

19:33Dave Ramsey:And somewhere around 30 years ago, we started teaching people to work what we call the baby steps. You may have heard that already. The baby steps are the first thing you have is$1 ,000 in the bank. You've already got$10 ,000, okay? But$1 ,000 is all you need for right now. So we're going to take nine of that and apply it to baby step two. Baby step two is you list all of your debts, smallest to largest. You pay minimum payments, the normal payment on everything but the little one, and you attack the little one with everything you can squeeze out of your budget and with$9 ,000. So I'm going to take the first$9 ,000 of your smallest credit cards and pay them all off and cut them up tonight with your husband, and I'm going to have$1 ,000.

20:15Dave Ramsey:Then I'm going to beat the snot out of this debt in the next six months and get rid of it, all of it. And then when you don't have any payments, I'm going to build an emergency fund of three to six months of expenses. Take the$1 ,000 account, raise it back up to a good, solid savings account. Then, baby step four, start putting 15 % of your income away for retirement. If you do this, in seven to ten years, you will be debt-free, house and everything, and have close to a million-dollar net worth. I'll show you how to do it. I'm going to send you a total money makeover book as my gift.

20:53Ken Coleman:Okay, Rachel, the internet officially knows too much about all of us. So much, George. I mean, our names, our addresses, even our relatives' names. And what's crazy is even if you opt out, data broker websites can still get your info. Don't like that. And just a year ago, get this, the average person had about 300 pieces of personal data floating around online. Now it's over 600. It has doubled in a year. You guys, that is so concerning because that info then can be used in phishing scams, impersonation, and even harassment. So that's why George and I both use and love Delete Me. Yes, Delete Me scrubs your personal info from hundreds of these data broker sites, not just once, but all year long.

21:30Ken Coleman:And there's real privacy experts behind the scenes doing this, not bots. So this is digital hygiene we all need. We all need it. And then they will send you a detailed report showing exactly where they found your data and what they removed. And you can even request custom removals if you have something specific you want them to look out for. Exactly. And this is not being paranoid. This is staying protected. And so far, Delete Me has removed my info from 240 listings and saved me 94 hours of time it would have taken me to do it. I love it. And you guys, in a world where strangers can Google your grandma and get enough info to scam her in just two clicks, Delete Me gives you peace of mind.

22:06Ken Coleman:Yes. So go to joindeliteme.com slash Ramsey for 20 % off. And that discount brings their annual plans down to about nine bucks a month. So go check it out. joindeliteme.com slash Ramsey.

22:41Dave Ramsey:buying or selling your home is a big deal a lot of drama around real estate and as dr john deloney says when you're facing drama or a crisis facts are your friends so what are the facts in the real estate business not what is somebody on tic tac saying what are the actual facts not what your broke mother-in-law with an opinion said, what are the actual facts about real estate? Well, the facts are there's 1 ,082 ,520 homes on the market in the United States right now. That is the highest inventory of homes for sale available since 2019. However, demand is still exceeding the inventory, so that means prices have not gone down, nor will they unless inventory exceeded demand.

23:32Dave Ramsey:That's the only time you see prices drop in any commodity, including housing. So these are basic facts. And the median home price today is$441 ,000 in America. It's gone up just a tiny bit every month this year, like$1 ,000 or something, nothing. So home prices are steady to trending barely up. Those are the facts. The facts are interest rates are exactly where they were 5.95 right now so under six percent for a 15-year fixed rate so all in all it's really good time to buy a piece of real estate or sell a piece of real estate if you're ready if you're out of debt you got your emergency fund you got a down payment all in all that's the facts you're okay and if you need to sell a house right now it's nothing to panic about there's people buying houses and you know it's happening so if you want to learn more about all this go to ramsey solutions dot com slash market or click the link in the show notes and we'll help you out that way ashley's in

24:29Ken Coleman:pittsburgh hey ashley what's up hi dave and ken thanks for taking my call sure my husband and i are both yeah my husband and i are both in our mid-30s and just had our first baby yeah i'm currently on maternity very exciting um i'm currently on maternity leave and trying to decide whether to go back to work or stay home with our baby. Financially, we can afford for me to stay home. We're debt-free, including our home, have an emergency fund, and we've been pretty disciplined about saving and investing. But we're torn because of a couple of other factors. The first is that we both work in tech and with how fast AI is moving, we're concerned that our jobs could change or even disappear in the future.

25:12Ken Coleman:So part of us feels like we should double down on income and savings now while we can. I'm also worried that if I step away now, it could be tough to reenter the workforce later on. If I decide to, once we're done having kids and they're older, I don't know that I'd be able to get back to the same level I'm at now. So my question is, since we can afford either path, how would you think through this decision? Well, first question I have is forget everything you just threw out in those two concern buckets. What does your heart want to do? What do you want to do? Let's start there. Ideal. Sure. I guess nothing could replace the time with our children or our future children.

25:53Ken Coleman:So, you know, my heart's leaning towards staying home with our babies. All right. So we start there. That's your ideal situation. Now, let's take the first bucket. You both work in tech. AI is what you're thinking about because everybody's wondering how is AI going to shake out? How is it going to affect tech jobs? Will it spin off new jobs? One of the things I would do because you're both in tech and you have knowledge of where tech is now. You probably have knowledge of where you think it's going, people that may be more advanced than you guys are. I would be talking, getting a lot of feedback, almost like a Halloween candy bucket, knocking on doors, getting a lot of candy.

26:31Ken Coleman:I'd get a lot of real, legitimate feedback, not headlines, not people that are driving clicks. And I would look at what does the future look like? Personally, I was on Fox Business probably three weeks ago, one of the topics they asked me about was what do I think about AI and it removing jobs? And that morning I had done some research and I went all the way back to the printing press in history. And I'll save you the entire study that I did in about 30 minutes. And I looked at what the media of the day and what the hand wringing and the pearl clutching of the day was around all these advances in technology from the printing press to where we stand today.

27:11Ken Coleman:And here's what's crazy, Ashley. It all sounded the exact same. The alarm was it's going to kill jobs. And throughout history, what we saw is there was some recession of jobs in the immediate, but it always spun off more jobs. And I think AI is going to do the same thing. And that's just me doing some historical homework and talking to people that are experts in the industry. And I think it's going to spin off a lot. But do your own homework on bucket one. Bucket two is, can I reenter, let's say, 18 years from now if I want to? And I've coached a lot of moms on this particular issue. And the answer is you can.

27:50Ken Coleman:Now, will you have to get some additional qualification if the puck has moved over 18 years and it's understandable that it might? Yes. But to be completely outdated, I'm not valuable. I have no skill. I have no experience. That's a bunch of garbage. And that's not true. So with staying kind of a finger on the pulse, maybe 14 years in and going, OK, I think four years from now, I feel good. I want to come back. You got enough time to upskill. And if you keep relationships, I think you'd be fine. That's my take on those two buckets. Yeah.

28:29Dave Ramsey:Take an eye out of it. If you went back just 10 years and you stepped out of the technology market and you tried to step back in today, you'd have to retool.

28:39Ken Coleman:Right.

28:41Dave Ramsey:What were we using 10 years ago? Cold fusion. Nobody uses cold fusion today. And so you would have been, if you were writing code, you might have been proficient in cold fusion, which is now a dinosaur. Nobody uses it. You know what I'm talking about, right? And so, and, you know, by the way, nobody's, very few people are housing servers in their offices anymore. Ten years ago, I had a room with an air conditioner in it full of servers. Today, I don't have one. Everything's in the cloud. And I've got a much bigger operation than I did ten years ago. So technology shifted in hardware, software, you know, the internet.

29:18Dave Ramsey:So anytime something comes along that is a disruptor and that has a high rate of change like technology does, like the Internet, the appearance of the Internet was supposed to put entire segments of the culture out of business. Instead, it created, to Ken's point, a lot of new jobs. There was no such thing as someone who built websites prior to the Internet. And while the Internet might have put out some kind of job, it created a whole bunch of people that built websites. And there was no such thing as email. And so, you know, did the postal carriers all go out of business? No, not because of email, you know, and there was no such thing as, and keep filling in the blank.

29:56Dave Ramsey:So 100 % chance the knowledge that you have today, whether you stay in the market or whether you go home, the knowledge you're using today is going to be irrelevant 10 years from now.

30:09Ken Coleman:Right, yeah.

30:09Dave Ramsey:So either way, you're going to either stay up with the market by staying in the market, or you're going to retool when you get ready to head back into the market. So given all of that, if I'm you and hearing what you said about wanting to be at home, I'm staying home. The only thing driving you to not stay home is fear about your career. And fear is not a good decision-making tool. And in this case, it's not accurate. Because you have to, you're going to have to stay up with change or retool to hit change no matter what. We live in the highest rate of change environment in the history of mankind.

30:47Dave Ramsey:the change rate in transportation in the last 50 years the change rate in communication in the last 50 years is more than the 500 years previous so that that's the environment that we all live in and so he who hates change is screwed that's what it amounts to you better embrace it and i hate it i'm like everybody else i don't they just put new i just got another computer and they put new stuff on my computer and I'm pissed off again trying to figure out how to run it you know and it takes me a little while to get through the frustration of the learning curve and then they'll give me another it'll be um download for apple version 87.46 or whatever the crap it is and now I gotta now my iphone doesn't work anymore the way it used to now I gotta figure out all that because they were trying to help me you're killing me but that's the world we all live in is this rate of change If I had sat down in 1975 in a car that I drive today, I wouldn't have known how to start it.

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33:59Dave Ramsey:Brandon's in Knoxville. Hi, Brandon. Welcome to the Ramsey Show. Hey, Dave. Good to talk to you. How are you doing? Better than I deserve. How can I help?

34:09Ken Coleman:I just had a pretty quick question. Me and my wife decided that we're going to sell our house and be moving back to our hometown in Florida. Our house is actually listed below the median price here in East Tennessee. And in almost three months, we've only had four showings. and I was just wondering if you thought that was normal.

34:39Dave Ramsey:No. Well, I mean, what's the price? The price of our house right now is$364.9. Okay. And what are the comparable sales in your area? I couldn't give a crap less what the median price in each Tennessee is because there's million-dollar houses and there's$100 ,000 houses and there's neighborhoods associated with both. What is your house appraised at? So our house was appraised at around$400 is what it was appraised at. By who?

35:10Ken Coleman:And then when our realtor did comps on it, she said that listing it at$399 was an accurate pricing, which, again, it's more than fair because we bought during 2020.

35:25Dave Ramsey:So it's more than fair. What do the pictures look like, the pictures they took and put on the Internet?

35:30Ken Coleman:We got a professional photographer. He did the whole new 360 camera walkthrough thing.

35:38Dave Ramsey:Did he expose the ugly? I mean, is the house ugly from the street?

35:41Ken Coleman:No. I mean, everything looks great. I've put a lot of work into it. I've redone just about anything you can imagine in it. Everything looks good. The landscaping looks good. We've only gotten four showings, and I'm just—

35:54Dave Ramsey:Are you in an outlying area?

35:58Ken Coleman:um i'm actually right by one of the major airports over here um pretty much near right next to the city of knoxville i mean we're in a great location it's right yes okay so you're not in knoxville you're in alcoa uh yeah they uh the girl asked and i think that's okay that's fine i'm just i

36:19Dave Ramsey:was born in maryland i was born in maryland so oh were you really wow okay so i actually know where you are um the um well that market's booming that market and that topside road all that stuff is booming and you know you've had a lot of good industry move in there um and and so there shouldn't and your price you are a um you know mid-range price and that thing should yeah you're not there's a problem have you asked the real estate agent why it's not being shown I'm sure you have.

36:50Ken Coleman:I've asked, and here's another question I had. Do you think a month and a half to do the first open house was way too long?

37:00Dave Ramsey:Open houses usually don't sell anybody but the seller. Okay. The number of times you sell a house at an open house is fairly low. I'm wondering if you're a real estate agent. How many houses did your real estate agent sell last year?

37:16Ken Coleman:I'm going to be completely honest with you. I don't know. family friend that I went with. What was her answer? You never answered Dave's question on what did she say? Why did she say it's not selling? Oh, I'm sorry. She just said to be patient. She said it's the market that's being slow. I ended up doing my own comps with actually a friend of mine that does real estate. Actually, two of them, and they both said they don't have any idea why in the world it wouldn't even get more than 10 showings by now.

37:53Dave Ramsey:So it's not, we don't think it's price. We don't think it's ugly. We don't think it's the location. We don't think it's the location. It's not far out. Should they be doing more online advertising or how should a realtor be doing that? Yeah, here's what I'm concerned about. The only other thing I can think of is when you said family friend, I went gulp because that's not how you select a real estate agent. You select a real estate agent by getting a high octane, high protein, high performer, because this is a huge asset and you're hiring a marketing consultant and they need to actually sell like, you know, 50 to 200 houses a year, or you shouldn't be using them to sell your house.

38:36Dave Ramsey:So I'm afraid this person might be selling three houses a year and there's no personal momentum around them, around their company around their name and so when another real estate agent that is high octane sees that sign versus a different sign they're they're not giving it due because the person that's got it listed i'm afraid you got a weak sister so to speak with a sign in the yard so um you might want to change just on that basis and not not because i don't think they're doing horrible but i just don't think they're doing it and you've obviously said that and you've got that concern so I think you just call them up and say, hey, listen, in the name of preserving our friendship, I'm becoming very frustrated, and I think we need to separate.

39:20Dave Ramsey:I know you tried. Thank you for that. But I need to try something else now, and otherwise I'm afraid I'm going to become extremely frustrated, and I don't want to damage our friendship. So we're going to try something else, and thank you for trying.

39:34Ken Coleman:Yeah, fair enough. I agree. And I messed up because this is the first house I've ever had to sell. so I've never had to do this before.

39:41Dave Ramsey:That's okay. A lot of people do this. But if I hired you, if you worked for me, and you were to select a consultant to assist with a$400 ,000 asset, and you selected a consultant who doesn't do it very much, I would fire you. You see what I'm doing? Because you hired somebody that's not got a proven track record in the marketplace. So go to Ramsey solutions.com and click on real estate. Find one of the Ramsey trusted real estate agents. There's several in your area. Interview two or three of them and interview them like you're hiring a marketing consultant that you're going to pay 20 grand to because you are.

40:22Dave Ramsey:And so you ought to get, they ought to come in with a presentation about how awesome they are and how much volume they move and what the marketing plan is to move your property. and they ought to earn your business by their professionalism and their productivity. And that's how you would hire a good marketing consultant. That's how you hire a real estate agent. So 85 % of the real estate agents people are not in the business three years after they start. The average income earning of a real estate agent in America today is$36 ,000 because they go get their license and they sell one or two houses a year.

41:03Dave Ramsey:You do not want those people selling your house. I don't care if it's your Uncle Charlie. He's sweet Uncle Charlie. He sucks as a real estate agent. I don't care if it's Gilda down at the church. I'm sure Gilda's a sweet little church lady. Nice lady. But she sucks as a real estate agent. You don't hire Gilda. Don't hire Uncle Charlie. Don't hire Gilda. I agree. And people do this all the time. And sometimes the people that get their license and their brand new friends and their old friends and new licenses, They get pissed off if you don't use them. I've had a real estate license since I was 18.

41:37Dave Ramsey:I listed our house with one of our Ramsey trusted things, people many years ago. And one of our friends got mad at me. And I'm like, well, there's like three people in line in front of you. A, the guy who listed it. B, me with a license before we would get to you who doesn't sell any houses. So you just sit over there in your house and be pissed off. That's just dumb. Okay. So no, we're not doing that. But that's, Brandon, you did what everybody else does, and so I think you just go gently and kindly correct the situation. Interview like you were hiring a professional marketing consultant for a piece of real estate because that's what a real estate agent is.

42:18Dave Ramsey:And then you get someone that you can connect to and that is very convincing of their productivity and their proclivity, their competence, their high octane. They move property. and someone wants to sell up a house, then maybe they ought to have sold a house like 50 times last year or 100 times last year.

42:38Ken Coleman:You know what stuck out to me is the first answer to Brandon's question, legitimate question, was be patient. That tells me that the reason that she said to be patient is because she's a little too patient. I'm thinking of the lady that Stacey and I have used for a long time. She's one of the top producers in all of Tennessee, top two or three in this area, and she is not someone I would describe as patient. and there is a time and place for patients, but that should have not been the first bullet fired to his question. That's a warning sign, and that, to your point, is a wiring issue. It's a results issue.

43:12Dave Ramsey:Yeah.

43:13Ken Coleman:I listen for things like that.

43:14Dave Ramsey:It might not be the real estate agent here. It might not. We don't know. This could be a high-producing real estate agent. We don't have the numbers on this agent, but we do know he's unhappy with her, so let's change horses. Yeah. It's okay. Nothing wrong with that.

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44:35Dave Ramsey:live from the headquarters of Ramsey solutions. It's the Ramsey show where we help people build wealth, do work that they love and create actual amazing relationships. Ken Coleman Ramsey personality is my cohost today. Thank you for joining us, America. We're glad you're here. Open phones at 888-825-5225. Nicole is in Colorado. Hi, Nicole. How are you?

45:05Ken Coleman:I'm well. How are you doing today?

45:06Dave Ramsey:Better than I deserve. What's up? So I had a question about kind of like an in-between baby step thing.

45:14Ken Coleman:So, essentially, we have a couple larger lump sum amounts that should be coming into our possession within the next few months. And I wanted to know whether I should just throw all of it to the remaining student loan debt, which is the only debt we have, or if we should split it, putting some towards a potential down payment and then the rest towards the student loan, kind of building both things simultaneously.

45:45Dave Ramsey:So how long have you been working to get out of debt?

45:50Ken Coleman:Relatively recently. My student loans were in deferment with all the COVID stuff and everything like that. And then my husband, the union contract through his job finally reached an agreement. So he has a bunch of back pay coming in, and we have a sizable tax return that should be coming in. and so it will ultimately equal

46:16Dave Ramsey:So you just started a system and then I'm going to poke at you Are you ready to be poked?

46:21Ken Coleman:Oh yeah

46:22Dave Ramsey:And then your first thing is to cheat the system

46:27Ken Coleman:Via the home buying process

46:28Dave Ramsey:Yeah, you don't need to be buying a house until you're out of debt and so we need to put it all on the debt so we can get the debt cleared How much debt do you have?

46:37Ken Coleman:Less than$24 ,000 And how much does all this back pay and taxes amount to? It should reach about$25 ,000.

46:46Dave Ramsey:Oh, so you can pay everything off.

46:48Ken Coleman:The other issue is that we have two vehicles that are completely paid off, old buy outright sort of things, but they need some work, so there's no way I can actually put all of that into the debt. Why, are they not running? Well, they are functional.

47:04Dave Ramsey:Good, put it all on the debt. Quit screwing around with this. Get out of debt. It's the thing holding you back from everything. Now that you're out of debt, what's your household income?

47:17Ken Coleman:Let's see here. Our household income before or after taxes and insurance and such, afterwards would be take home of$53 ,000 roughly.

47:27Dave Ramsey:Okay, but you're dead insurance coming out of that and taxes. Too much in taxes coming out because you've got a tax refund.

47:34Ken Coleman:Oh, so before taxes and insurance, it's about$71 ,000.

47:39Dave Ramsey:Okay, all right. And so what repairs need to be done to the car and what do they cost?

47:45Ken Coleman:So I just called and got a quote the other day for the biggest thing, which is like the timing belt and water pump. And then I also have an O2 sensor, which is affecting acceleration. And so that should probably come out to be about$25 ,000 to$3 ,000. O2 sensor is not that.

48:01Dave Ramsey:The timing belt is.

48:03Ken Coleman:Yeah. The O2 sensor is almost nothing. Yeah, but the timing belt is the bigger of the two.

48:08Dave Ramsey:Yeah, run and get the O2 sensor fixed out of your budget, and then start saving in the next month. Go ahead and do the timing belt. You can do it in a month. Okay. And let's get them fixed and get them going, keep things running. Now you're out of debt, and then you need to build your emergency fund of three to six months of expenses, and then you need to save for a down payment.

48:28Ken Coleman:Okay.

48:28Dave Ramsey:And that's what we teach, and you already knew that.

48:32Ken Coleman:Yeah, I was trying to listen to as many as possible to kind of get an idea if anybody else asked my exact same question.

48:38Dave Ramsey:No, I mean, you knew the process, though, was that we get out of debt and have an emergency fund before we buy a house, didn't you?

48:46Ken Coleman:Yes.

48:46Dave Ramsey:Okay.

48:47Ken Coleman:Well, yeah.

48:48Dave Ramsey:Yeah, you knew that, and you've been listening long enough to know that part. And so let's just stick to that. And that's going to be your shortest distance to getting a home in a situation where the home is not creating stress and instead it's a blessing.

49:02Ken Coleman:Okay.

49:02Dave Ramsey:I want you to get a house. I don't want the house to get you, kiddo.

49:06Ken Coleman:Yeah. Well, particularly since we're not exactly on the higher range of income, so it's not exactly like we're affording a fancy, totally redone.

49:15Dave Ramsey:Make sure you don't have – how many years in a row have you got tax refund?

49:21Ken Coleman:This is probably the fourth.

49:23Dave Ramsey:And how much has been your tax refund?

49:25Ken Coleman:Let's see. Last year was about$11 ,000.

49:28Dave Ramsey:Okay. What that means is they're taking almost$1 ,000 a month too much out of your checks, and then they give it back to you a year later with no interest.

49:39Ken Coleman:Yeah, particularly since the W-2 has not been amended to account for the children we have had.

49:43Dave Ramsey:You need to amend the W-2 to account for$10 ,000. $800,$850 a month needs to come home more than is coming home now.

49:53Ken Coleman:Oh, that would be substantial.

49:54Dave Ramsey:That'll help your budget, see, and that'll pay for the timing belt and everything else. you don't need to have a savings account with the IRS. That's what a tax refund is.

50:02Ken Coleman:Yes.

50:03Dave Ramsey:Monthly, you make a deposit into the IRS, and at the end of the year, they give you a tax refund. Santa Claus does not live in Washington. That's your money. Didn't come from him. I know him well. He lives in the North Pole, not in D.C. Matter of fact, he's like most of us. He doesn't even like D.C. So, yeah, that's fun, kid. You're going to do great. Stick with the system. Let me send you a copy of the book, The Total Money Makeover. You and your husband both go through that, and both of you hold hands and get dialed in and really focused, maybe for the first time in your lives, on the details of this stuff, and then work those baby steps exactly.

50:38Dave Ramsey:And that'll get you a home that's a blessing faster than anything else. You know, Ken, I was on a guy's podcast a while back. He was very successful. And he surprised me when he said, you know, I've known him for a decade. and he goes, I've never done your stuff until about two years ago. And he goes, I finally started doing it, and I did it exactly in detail the way you teach. And he goes, the progress we've made is in a short period of time is enormous. And then he said something that kind of shocked me. He said, my problem was I refused to submit myself to a system. That's right. and I thought that's an interesting word choice because that's you know if you bring in a personal trainer and they have a six-pack and you got a keg you have to submit yourself to their advice and their eating pattern that they're suggesting their workout pattern that they're suggesting because they have a six-pack you got a keg so you need to know that they know something you don't know, and you don't need to tell them how to do this.

51:49Dave Ramsey:They know how to do it. Yeah.

51:52Ken Coleman:That's interesting. It is interesting. And the guts of this is focused discipline. That's the key. I also want to give Nicole your quick read, the momentum theorem, because I think that's fabulous. You know what I mean? To just really understand the power of that and then get into the baby steps. It's a quick read. Okay. You know, because what you're teaching here for her, she's been listening. But she really needs to understand what makes the baby steps so powerful is that it is exactly the illustration you use. It's like a trainer is going to come in and be very focused on nutrition plus exercise.

52:28Ken Coleman:We're going to work on it. But am I going to do it? That's the issue. You've got to submit to, as your friend said, submitting to the system.

52:34Dave Ramsey:Because none of us, I don't like that word. No. I don't want to submit to nothing. Well, it takes our illusion of power away. Yeah. I don't want to submit myself to what was that? No, no, thank you. I feel like I'm bowing down or something, you know? Yeah. It's a weird word. But what it means is I'm admitting that my plan is not working and I need to try yours. That's what I'm admitting when I do that. And I thought that was interesting. Yeah. And he said it made huge progress after that. Yeah.

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55:40Dave Ramsey:RamseySolutions.com slash webinar. Antonio is in Columbus, Ohio. Hi, Antonio. How are you? Hey, doing well. How are you? Better than I deserve. What's up? Awesome. Thanks for taking my call. I was curious.

55:54Ken Coleman:I have a small power washing business that I'm hoping to be able to do full-time next summer, and my wife and I are still in baby step two. We were not sure if we should put money away for a larger emergency fund to cover expenses for the business as well as home, since I'll be fully self-employed over the summer next year.

56:18Dave Ramsey:What do you make at your regular job now?

56:22Ken Coleman:At my regular job, we bring home around just over$8 ,000 a month.

56:28Dave Ramsey:You or you and her?

56:30Ken Coleman:My wife and I. What do you make?

56:32Dave Ramsey:You're the ones going to quit.

56:35Ken Coleman:About$6 ,000.

56:37Dave Ramsey:So you're going to make$72 ,000 a year with pressure washing. Profit.

56:42Ken Coleman:Well, sorry. So I drive school buses during the school year. And so in the summertime, we find our own work. And that's kind of what I was hoping to do in the meantime, basically, over summer. So I wouldn't be full-time throughout the whole year. It's just in the summertime, that's when we're busiest power washing. Okay.

57:00Dave Ramsey:What were you doing in the summer?

57:02Ken Coleman:This summer I actually picked up a concrete truck driving job with my CDL, and that's paid well.

57:09Dave Ramsey:And what did you make?

57:12Ken Coleman:Sorry, that's when I'm bringing$6 ,000 from the concrete.

57:18Dave Ramsey:Okay, so for three months, so$18 ,000 you've got to make in pressure washing to offset the concrete truck job.

57:25Ken Coleman:Correct, yeah.

57:26Dave Ramsey:In the summertime only. Am I hearing all that? Yes, correct. Okay. And what do you make driving school bus?

57:34Ken Coleman:That fluctuates because we kind of can do as much overtime as we want, but it's probably closer to about$5 ,000 a month.

57:41Dave Ramsey:Okay. Nine months a year.

57:44Ken Coleman:Correct. Okay.

57:45Dave Ramsey:All right. Good. So Ken and I teach with small business ideas that you want to pull the boat close to the dock before you jump in. But this is not that big a deal because it's only for three months. so you don't really have to have a big emergency fund. You just need to get busy in the spring and line up a whole bunch of jobs. Listen, so when is the last day you drive in May?

58:13Ken Coleman:The last day would be, I think it's May 20th, something like that.

58:18Dave Ramsey:So the 1st of May, I want you to start calling on people and setting up jobs to begin on the 20th, and I want you to fill up the 10 days of May and all of June before May 20th. I want you to fully do your marketing and book up the first month of work solid. Okay. All right. And you already have the equipment, right?

58:44Ken Coleman:Correct, yeah. I have a paid-for trailer, all the equipment, yeah.

58:48Dave Ramsey:All right. And so I want you to book up. And so here's what happens. during the month that you are doing that work you go and get the other two months booked up if at any time you don't get something booked up you got to shut down and go do something else so if during the 20 days of may that we are driving a truck and booking up and at night knocking on people's doors and getting pressure washing jobs or whatever you're going to do to get the jobs if during that 20 days you can't get that month full you have to go drive concrete truck instead okay so you have to prove this business idea or not do it does that make sense

59:32Ken Coleman:yeah yeah that makes sense that would also be more peace as well because then i'm not stressed

59:36Dave Ramsey:if you don't need any emergency fund to do what i'm talking about correct yeah all you need is business yep and a plan and a plan b if business doesn't hit uh two questions how many hours are

59:49Ken Coleman:you working on average because you mentioned overtime how much are you working uh when driving the school bus nine months a year what's an average week hours wise uh my average oh man it was close to like 50 55 hours um when i was picking up all the overtime okay the reason i ask five days a week yeah the reason i ask that is i would also add to dave's advice i'd be doing pressure washing on the weekends sunday afternoons some saturday mornings if you've got time if you can handle that load. You may not be able to. Second question is, what is the difference in rate per hour if I'm pressure washing for myself versus driving the concrete truck?

1:00:28Ken Coleman:What's the difference in hourly pay? So the concrete truck is a 28 an hour right now. And there's potential for raises, of course, next year. But power washing, I try to, like whenever I go give a quote, I try to get somewhere around$100 an hour where I could take home like most of that. Yeah. Since I'm not putting any money into the business right now, it's all going to baby step two. Yeah. Okay. That's good. I just wanted to know.

1:00:57Dave Ramsey:So that means you're making almost 4X per hour. So that means you could work one-fourth the hours and make exactly the same money. If the pipeline is full. But you've got to get those hours booked. You've got to get slammed. And if you can get yourself slammed 10 hours a day doing pressure washing for three months, you're going to make a pile of money. Yep. So how have you been acquiring customers?

1:01:24Ken Coleman:Actually, so most of the customers I've been washing for the summer, I'll do it after I drive the trucks. So I'm working a lot more.

1:01:34Dave Ramsey:Good.

1:01:34Ken Coleman:I partnered with an HOA from someone who I know at church is the secretary for the HOA, and she heard I had the small business and offered to partner. And so that's all it's been is referrals within that neighborhood. It's a very large neighborhood, and I haven't had to do door knocking or anything. Thankfully, people are just reaching out to me. So what are you paying her? Oh, I didn't pay her.

1:01:58Dave Ramsey:Oh, so when you say partner, you didn't partner. She just was your source. She helped you.

1:02:04Ken Coleman:Yeah, correct. Sorry. Yeah, they like to have, like, local businesses that can come in.

1:02:09Dave Ramsey:Like, they have a landscaper, and then they ask me to come in. Good, good. Well, that's a great partner. I like that kind of partner.

1:02:15Ken Coleman:That was my first question. What's her take on this deal?

1:02:19Dave Ramsey:Okay, so, yeah, I think – so you've got a good source, and if you start working that HOA leads and even people you worked for last year and swing back around and say, hey, I'm going to gear up May 20. when can I put you on the schedule, they're going to line up, right?

1:02:35Ken Coleman:Correct, yeah.

1:02:36Dave Ramsey:Yeah. Because I've got a guy that hits my lake house, which is known for mildew. It's a lake house with pressure washing every spring, and he's got pretty much a set gig. All we have to agree on is the day he's going to do it. He's got a set customer. As long as he shows up, does the work, charges me about the same, he's been doing it for years for me, and a great guy. And so that's who you are. You're that guy. So you can create repeat business that swings back around annually. And, you know, hey, you know, Antonio's going to be ready to go here, baby. And we're going in.

1:03:08Ken Coleman:I love this. I didn't know the numbers on this. Antonio, I got to give you this. Take this or leave it. In my neighborhood, we saw an ad recently in whatever the neighborhood newsletter is about a young guy who is going around pressure washing garbage cans, which, you know, can get pretty nasty. I'd add that to the thing. You may be surprised. It might add a little 30 minutes to the deal. You're already there. People don't think about it. But when we saw it, I was like, Stace, we need this kid to come over because it's disgusting, these garbage cans.

1:03:41Dave Ramsey:And she's like, Ken, get out there and clean it up.

1:03:45Ken Coleman:No, she didn't. She knows better. I think she's given in after all these years. My intentions will be good, but I'll get distracted on the way to the trash can and come up with three other projects. is usually my problem. But yeah, you're right. He's just out there power washing these trash cans.

1:04:03Dave Ramsey:While you're there, add that as a, you know, for$25, we'll knock these out.

1:04:07Ken Coleman:Because you'd be surprised how people will go. Because no dude that I know wants to spray out his garbage can.

1:04:13Dave Ramsey:Hmm. Hmm. So, a little upcharge. Yeah. Well, I mean, he's in an HOA. He's in a neighborhood like yours. So, there you go. Those rich people, they do all kinds of stuff. Time is money, Dave.

1:04:25Ken Coleman:Somebody told me that once. Thank you.

1:05:15Dave Ramsey:Today's question of the day is brought to you by Y-Refi. If your private student loans are in default and you feel stuck, you're not out of options. Y-Refi specializes in helping borrowers like you find real solutions with low fixed rate refinancing. Go to YRefi.com slash Ramsey. That's the letter Y-Refi, R-E-F-Y dot com slash Ramsey. Not available in all states.

1:05:39Ken Coleman:Today's question comes from David in West Virginia. I've recently learned that a couple of my employees mooch personal money from soft-hearted co-workers and aren't paying back what they've borrowed in a reasonable amount of time, if ever. While it may just be a couple of hundred dollars of personal money, I'm afraid of negative culture developing in the workplace. Do I have a right to address the situation since it's between them personally and the business isn't really involved?

1:06:11Ken Coleman:do I have a right yeah I think you do in the sense of these are people that you're employing and it's now becoming an issue that is going it's not a gossip issue this is a fact at least you're outlining in a way where you know this is a fact and it's rising up to you And this affects the actual team dynamic. And I think talking to the people that are loaning the money is probably where I would start. I think anytime you've got a situation like this where you've got people just with bad behavior where they're loaning – I mean, they're borrowing basic small amount of money and not paying it back, that's just irresponsible.

1:06:53Ken Coleman:And to me, that's a sign that they shouldn't be working for you. So I would be addressing that issue, not so much getting into all these details. I would kind of end around it instead of sit down with these people like they're little kids. I may be wrong on that. You may have a different approach. But I would probably address the fact that there's a character problem here. And it's been made aware to me that it's a character problem. And I don't want people working for me that have character problems.

1:07:17Dave Ramsey:Yeah, yeah. You don't have a right. You have an obligation. Yeah. You are in charge of what happens there under your leadership, and crap is happening under your leadership. And if you don't do anything about it, you suck as a leader. So you've got to do something about it. Now then the question becomes, how heavy-handed are you? Yeah, that's what I'm struggling with. And what is it that you do? So if it's a couple hundred bucks, I'm probably starting with the two people loaning money. I'm going to give them both a total money makeover book, pay for them to go to Financial Peace University. and here's your$200 back and don't ever loan anybody money again as long as you work here.

1:07:55Dave Ramsey:If you do, I'm going to fire you. I like that approach. And just make them whole and then shut down the source. Then I'm going to the two or the couple of people, whoever it is, that borrowed the money and didn't pay it back and say, this is over. If you borrow money from someone here at the office or get money as a gift from someone here at the office again as long as you work here it will be your last day you're not doing this anymore for you to take money from someone that's hard working and then not give it back to them as promised is a character problem it's almost stealing you're pretty close and so no you're not going to do that while you work here i want an environment where people feel safe where people like each other they trust each other that's the culture that we're going to have and that can only occur if you are worthy of trust.

1:08:47Dave Ramsey:And so I have paid them the money back. You don't owe them. You are forgiven the debt. But if you ever borrow a dime or take a dime in charity from someone else that works here while you work here and I find out about it, it will be your last day. And I'd give them a zero tolerance. One strike, you're out from here on. So they get a warning. They're whole. The other guy's whole. Problem solved. It's over. And then I would make an I don't know how big an organization this is but i would just make an announcement that just says hey um uh guys sometimes people want to borrow money and stuff i've made a decision that's not okay here and if somebody comes to you to ask you to borrow money from them it's not okay here you don't need to loan people money that work here everybody here works too hard nobody here's rich okay so don't get in that business and you guys quit trading dollars back and forth you don't trade spit back and forth you don't trade dollars back and forth you work here this is what we're doing okay and you know just make a general announcement make a joke about it and move along and don't don't make a big thing like we've had this serious problem and i've addressed i wouldn't do all that i'll just make a general blanket quick statement 30 seconds hey just want to let everybody know i've got a policy on this and i'm not okay with this and don't do it anymore if you were doing it so uh we're done and but you've already addressed the other people directly individually and privately before you get there.

1:10:08Dave Ramsey:But you have a responsibility. It's not just a right. Yeah. A responsibility for the people that work there. Okay, so let me give you another example, Ken. Everybody acts like somehow that you're not allowed to do stuff in business because it's business and you're supposed to just keep it all business. Right. Well, that's a bunch of horse crap. Okay. So I got 1 ,100 people here. I was standing in the lunch line while I go getting a taco with a young guy who just got married to another person in the building. He met his new wife here. So now I have two team members that are married that work here.

1:10:42Dave Ramsey:Okay. And he met her here. They just bought a house. Great little couple, sharp as a tack, all that. That's the good story. The other story is when someone starts dating here and it goes bad. And then they feel threatened or stalked or whatever. Well, that's their personal life. You shouldn't get involved in that. You dadgum right I'm getting involved in it. It's a 26-year-old, 25-year-old young lady that feels threatened inside our building. Absolutely I'm getting involved in it. That's not happening here under my watch. I'm the leader of this organization. Her dad expects me to make sure she's in a safe situation.

1:11:19Dave Ramsey:And I'm an old southern gentleman, and we take care of the ladies. That's how we do it. It's an old-school chivalry thing. And if you don't like that, get your butt out of here and don't let the door hit you as you go out. I couldn't care less. And so that's, you know, well, you don't have a right. No, I've got an obligation to her because I got to look her dad in the face if he stops by visits one of these days and say, your daughter's safe here. No doofuses are going to be around her. That's right. And so, yeah, it's not just a right. It's an obligation to create a safe, high-quality culture.

1:11:54Dave Ramsey:Well, you're getting involved in their personal lives. That's none of your business. You're dadgum right. It's my business. It happened on my watch, on my payroll, inside my building. That makes it my freaking business. So some of you guys that own businesses need to grow a freaking backbone and stand up and do the stuff you're supposed to do to protect your team and take good care of your team and actually be a freaking adult about it. And instead of like, I'm a wuss and everybody says I don't have a right. And it's not just a right. It's an obligation. It's called leadership. Yeah. So but I'm not going to that's the heavy handed part is running down your backbone, not at the employee.

1:12:35Dave Ramsey:That's correct. So I'm going to soft pedal this with the employees. But, you know, this thing of this is a liberal left wing garbage. I have the right to. Yeah. You know, let me just tell you about my rights. It's got my name on the side of the building. That's my right. Right. OK, that means everything happens in here is my right. That's correct. And if you don't like it, hit the door. I'm good with that. Yeah. You know, and that's how this thing works. And again, I don't talk to people that way directly, but that's the inner Dave going, yeah, I'm going to stand up, take care and love the people that are inside of here.

1:13:08Dave Ramsey:And this is a quality high class where you can meet your wife, get married, buy your first house, and I get to meet you downstairs when we're getting a taco. And I'm happy and proud that that's the environment that that young man's in.

1:13:20Ken Coleman:Yeah. And I love the example you give, Dave, because you do that. And I've seen you do that over 11 years. And what's funny is the people that would attack that, it's not funny, the irony is the people that would attack that are the ones that would scream, everyone needs rights and women's rights, all that. And actually, when you defend someone who works for you from being stalked, that is absolutely defending their right to come to work and be safe. Yeah. So the irony of the criticism of that of, oh, you've gotten involved in something personal. No, again, they are a professional. And to your point, you are responsible for a safe environment.

1:13:59Ken Coleman:And I think that's a great juxtaposition on how you laid that out.

1:14:01Dave Ramsey:But the political correctness crap has invaded people that own businesses and they don't, they're even, they're afraid to even operate their own business. That's correct. Because I'm not sure I have the right. By God, you not only got the right, you got the obligation, baby. Thank you.

1:15:08Dave Ramsey:Cara is in Indiana. Hi, Cara. How are you?

1:15:12Ken Coleman:Good. How are you?

1:15:13Dave Ramsey:Better than I deserve. What's up?

1:15:15Ken Coleman:Thanks for taking my call. I'm a recent college grad, and I paid out-of-state tuition for my degree. I kept my costs low and competed in three seasons of athletics, and I earned about$15 ,000 in my sports scholarships. And then I also did honors college. I negotiated for more aid and applied for additional scholarships, saving around$25 ,000 to$30 ,000. My parents set up 529 plans for me and each of my siblings, and they've always said the amounts were equal. They chose expensive private schools and one has already overspent and is in grad school and the other is on track to do the same. I now live at home with my parents and I'm working.

1:15:59Ken Coleman:While building a budget, I started to contribute to, I plan to start contribute to my 529 to grow it for either my future education or if I decide not to go back my child. I don't have any kids yet, but my future children. That's when this issue came up. There's still leftover money in my 529, possibly$30 ,000 or more, but my parents won't tell me the exact balance. They're supportive if I go back to school, but they said no when I asked about saving it for my future children's education if I don't end up going back. I even once offered to give some to my siblings possibly, and they still said no.

1:16:39Ken Coleman:And now they're considering using it for my dad's retirement. How old are you? I'm 22.

1:16:47Dave Ramsey:Okay. Oh, man, I'm so sorry.

1:16:50Ken Coleman:So I guess just the—

1:16:51Dave Ramsey:Well, number one, you've got to start looking for other housing, don't you?

1:16:56Ken Coleman:Yeah.

1:16:57Dave Ramsey:Yeah. I'm sorry. Thank you. Number two, your parents are in for a rude awakening. The 529 is not under their control. It's under yours. Do you have the account number?

1:17:10Ken Coleman:I don't, no. I don't have any information on it. And from what everything they've told me, I'm just the beneficiary to it.

1:17:16Dave Ramsey:No, that's not how it works. Okay. A 529 is in your name and they are the custodians until you're 21. So this is just your money, period. Okay. They have absolutely no legal control over this at all. and so i would sit down and um what what let's start let's back into this here here's what i want you to do i want you to go to ramsey solutions.com and click on smart investor pro okay and i want you to sit down with one of our smart investor pros in the investment world and let them assist you and see if you can find this account if you can find it just simply move it. Okay. Out of their control.

1:18:02Dave Ramsey:I mean, out of their hands where they can't find it. Okay. Because it's simply not their money. They funded it, but it's not their money. That's the danger of a 529 or not my account, either one. When you're 21, it is your money. Okay. And so that's, they committed that money to you. They don't have options here. So I think that's right. And I think you can just move it. But if they're going to steal$30 ,000 from you after you've put in all this effort to go to school with spending almost nothing, you should leave the home immediately. Are you employed?

1:18:46Ken Coleman:I am, yeah. I just started working, and I'm looking to just save up money by living here for a year. I know, but this is a toxic situation.

1:18:57Dave Ramsey:You can't compartmentalize this, kiddo. Your mother and father are trying to steal money from you. That's what you described to me.

1:19:08Ken Coleman:Yeah, and it's difficult because if I do decide to go back, then I don't want it to be an issue, but I'm also worried that if I don't, that it will be an issue.

1:19:18Dave Ramsey:I want you to find out immediately by meeting with a SmartVestor Pro if you can find this money. And if I'm correct that the 529 is in your name, then you just move it. If you can find it, you just move it. If I'm not correct, then you may just have walked away from$30 ,000, but I'm not sure you had it anyway. so your parents are um they're um well this is just it's just morally wrong that's the kindest way i can say it what they're proposing is morally wrong when they saved money for your college and there's a balance left in the account because of your effort and they want to take that and use it and they even propose if it even came out of their mouth that they would say I'm going to take your money and use it for my retirement.

1:20:07Dave Ramsey:I don't care if he put it in there or not. He put it in there for you. And then you have been more responsible than the other side. And in return, you get your money stolen. That's morally toxic and wrong. And that's me being very gentle. Because it's heartbreaking when you're 22 and you live there and you love them to discover that they're not trustworthy.

1:20:32Ken Coleman:Kara, you mentioned. I don't think I could look at them. Yeah. It's the same. Tara, you've mentioned a couple times, I might go back. What is in your mind about that? So I'm a nurse, and I'm looking to possibly go back for grad school, maybe a nurse anesthetist or a nurse practitioner.

1:20:51Dave Ramsey:Okay. Both of those would be great. Mm-hmm. Yeah. That's a good use of money there. $30 ,000 won't get either one of those, though.

1:20:59Ken Coleman:Yeah, but I figured it could help a little bit.

1:21:02Dave Ramsey:Yeah.

1:21:02Ken Coleman:The reason I ask is I'm just trying to catch you on the front end of this. Save that money up. You're making good money as a nurse. So hopefully you get control of those funds. And if you make that decision, hopefully what we want is to see you save that up, have a target.

1:21:17Dave Ramsey:Do not add anything to this 529 until you are in 100 % control of it. And even then I'm probably not going to add anything. I'm probably just going to save money to go to school with.

1:21:28Ken Coleman:Okay.

1:21:29Dave Ramsey:Yeah. I don't think you need to add anything to this in any scenario. But you need to figure out if you can get control of it. And then you need to, once you do, you need to have a different conversation with your parents. And I'm out of there within 30 days if I'm you. And it's the only possible way you can maintain some kind of relationship with these folks going forward. Because they are, you know, what they're doing is just really, really, really wrong. It's really toxic.

1:21:55Ken Coleman:and so yeah would you say there's a high rate of probability that if she were to pull off what you're advising her to do that they're going to be pretty upset about it oh i'd say they're going

1:22:04Dave Ramsey:to be so pissed they never speak to her again that's what i thought and i'm not sure that's

1:22:07Ken Coleman:a big loss it isn't but i wanted her to hear that i want you to hear that carrie because there's really this thing's going south one way or the other it's going to eat you alive or it's going make them upset you got to do what's right you may choose to walk away from this and just never

1:22:20Dave Ramsey:look back. That may be your choice. But if you can get control of your money, I would. And I think you can. I don't know if we can find it or not, but we got to get some clue as to where it is. But maybe a SmartVest Pro can help you with that. And they can advise you as to whether the advice I'm giving you is correct or not. I might not be correct. I'm sitting here spinning in my brain. I was real sure when I first said it. Now I'm starting to wonder if I'm right. But I think I'm right. So anyway. All right. Danielle's in South Carolina. Hi, Danielle. How are you? Oh, how are you?

1:22:54Ken Coleman:Hi, Dave. It's so good to speak to you.

1:22:56Dave Ramsey:You too. I'm real short on time. Can you go straight to it, please?

1:23:00Ken Coleman:Yes. How did this is a big question? I could ask something easy. How to save money at the grocery store? I mean, I'm working on getting married next year. I'm engaged.

1:23:15Dave Ramsey:Good.

1:23:15Ken Coleman:So just trying to figure out how to work through the finances.

1:23:21Dave Ramsey:Okay. Getting on the same page with your potential fiance?

1:23:25Ken Coleman:Yes. We'll use my fiance. Oh, you're not working on getting married.

1:23:29Dave Ramsey:You're scheduled to get married. That's right. So, all right. Yeah. I think the way you work through with anyone is lots and lots and lots of communication about the subject. The biggest thing with money is people don't talk about it until they're mad. And so let's talk about it before we're mad. I want to talk to you about saving. I want to talk to you about debt. I want to talk to you about a budget. I want to talk to you about combining our finances. And I want us to be aligned on that before we get to the altar because we're not going to get to the altar unless we get aligned on that because it's the number one cause of divorce in North America today.

1:23:59Dave Ramsey:And I want us to be aligned on that. And so let's talk about it. And let's talk about it. And let's talk about it. I hate debt. How do you feel? I love saving. How do you feel? I love generosity. How do you feel? I want to be on a written plan that you and I are in agreement to. I want us to combine everything and live our lives together like we actually love each other. If we're going to share a bed, we're going to share a checking account. And so what is the deal here? And let's start talking that stuff through. And lots and lots and lots and lots and lots of communication on all that. And I'll tell you what, I'll give you a framework to discuss it with.

1:24:28Dave Ramsey:It's called the Total Money Makeover. I'll send you my copy of it for free as your engagement gift.

1:24:43We'll be right back.

1:25:11Dave Ramsey:Pros who know their stuff, listen to your needs, and have your back from the first call all the way to closing day. To find a Ramsey-trusted agent near you, visit RamseySolutions.com slash agent. RamseySolutions.com slash agent.

1:25:39Dave Ramsey:Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Ken Coleman, Ramsey personality, number one best-selling author and host of the new Ramsey hit on Ramsey Networks called Front Row Seat, where he does long-form interviews with famous and accomplished people where you can learn the principles from them. You will love this show. He's my co-host today. The phone number is 888-825-5225. Gary is in Michigan. Hey, Gary, what's up? Oh, not too much, Dave. Ken, how are you guys today?

1:26:25Dave Ramsey:better than I deserve. What's up?

1:26:29Ken Coleman:Well, I'm trying to get the gumption to cancel a whole life policy. I've been listening to you guys for about 15 months, and I know I need to do it. I just need to push. Long story short, I can give you a little context. My dad was very financially successful, died about three years ago. And I had an annuity or he had an annuity, which is how he left me some money. And there was a whole life policy that this guy who had the annuity, my dad had taken it out on me and there was some cash value there. And he said, well, let's like, you know, set fire to the thing and essentially build a legacy, if that makes sense, build on your dad's financial legacy.

1:27:16Ken Coleman:Unfortunately, I did that before I found you guys, and so I'm just trying to deal with the emotions that come with that, if that makes sense. What are the emotions? Does that make sense? It does, but name these emotions.

1:27:35Ken Coleman:Well, I don't make a ton of money. I work for a nonprofit Christian ministry, and so there's let's just say that my dad like he was he was very successful at what he did ran his own business for a long time um and so he kind of pitched it in a way it made me think oh i'm i can take care of my kids the way my dad took care of me i can take care of myself yeah but then you

1:28:03Dave Ramsey:discovered that that was not true what is the emotion i'm trying to help you are you pissed at him yeah are you afraid you're not going to live up to your dad's expectations and legacy what is the emotion um i think it's i'm not even i wouldn't say i'm mad at the insurance agent um though i mean yeah it's fear mostly fear of what um fear of failing i think um Okay, hold on a minute. That doesn't square. Let me stop. You figured out that if you leave the money in this, you're going to fail. Yeah. Okay. And so if you pull the money out of it, is your only option to not fail?

1:28:52Ken Coleman:It feels that way, yeah. I'm afraid of screwing it up a second time. Like I've already screwed up by getting this policy and was duped into it, and now I fear that I'm not smart enough to do the right thing the second time. Does that make sense?

1:29:06Dave Ramsey:Yeah, that makes sense. You lost confidence in yourself. Yeah. So here's the antidote to that. We're not going to trust the agent, and we're not going to trust Dave and Ken and just do what anybody says anymore. Instead, you need to learn and understand and make an intellectual decision as to what the right thing is after gathering the facts. And then based on that, see, before you went with the agent who used a power play off of your father's memory instead of facts to make a sale.

1:29:47Ken Coleman:Yeah.

1:29:48Dave Ramsey:Okay. And I've given you facts. You've obviously looked at how bad a product Whole Life Life Insurance is. and you've decided I want to invest my money somewhere else. You've got to become confident in those facts for yourself, not because I said, but because they're facts. Yes. And when you're confident in those facts, then this becomes what's known as a no-brainer.

1:30:13Ken Coleman:Yes, I understand. But that's the emotion.

1:30:17Dave Ramsey:The emotion is I'm not confident yet. I don't know if I understand this. I don't know if I'm missing something. So here's another thing. You know, continue to gather information. Go sit down with a SmartVestor Pro. Have them walk through with you how bad this product sucks and then what you could do with it if it was in a good mutual fund. And then you will cash this crap out and tell this crook to go on his way.

1:30:45Ken Coleman:Okay. That's helpful to hear.

1:30:48Dave Ramsey:I mean, if somebody's stolen money from you and you discover that, You're not fearful. You're like, I'm going to get the money back. That's not fear. That's just I made, yeah. You did make a mistake. That's okay. Everybody makes mistakes. By the way, I bought a whole life policy when I was 22. Okay?

1:31:06Ken Coleman:Oh, really?

1:31:07Dave Ramsey:Yeah. And that's one of the ways I learned about this. I got screwed by a college friend of my wife's who came calling right after college and this sweet little married couple and sold me the same bill of goods that they sell everybody. And I was, I got a finance degree. and I was so stupid I bought it. So, you know, I'm no different than you, dude. But then when I looked at the facts, I went, okay, now I understand. I screwed up and I'm going to fix my mistake and I'm never going to do business with, you know, that type of a thing again. Instead, I'm going to put money in real investments and I have for the next 42 years.

1:31:45Dave Ramsey:And it's worked out good for me. So I learned from my mistakes, but I wasn't paralyzed by them. And that's all I want you to do.

1:31:54Ken Coleman:Yes. Yeah, I appreciate that a great deal. I realized it when I've heard this, and I've seen the math, and I've thought, what could I do with that if I just put it in my cash value and my Roth?

1:32:07Dave Ramsey:Oh, God, you just make so much more money. Exactly, yes. It's just so much. It's a bazillion-dollar difference.

1:32:16Ken Coleman:yes uh because i've seen the returns on those and i'm like wait a second yeah uh i've been duped

1:32:22Dave Ramsey:you have been duped you got duped for sure yeah and then i'm not having a discussion with a doofus life insurance agent no is a complete sentence yes it is you know you are cashing this out i'm not talking to you about it we're closing the account and you could just call the home office, give them the account number, and send them a letter to close the thing out. You don't even have to talk to doofus. But if doofus calls you, you don't have to have a conversation with him. You're not required. It's not federal law to discuss stuff with people who stole money from you.

1:32:56Ken Coleman:Yeah, and I think there's... No, it's not. I think you have a fear of confrontation, if I had to bet. Oh, I absolutely do. And I'm reading Dr. John's book, and this is part of choosing reality and choosing freedom. Yeah, that's right.

1:33:11Dave Ramsey:This is going to be a great exercise for you.

1:33:13Ken Coleman:It actually is. And you said you started off a call saying I needed gumption. I'm going to give you a tried and true formula. And Dave laid it out beautifully. Clarity, which is Dave telling you to go sit with SmartVestor Pro and look at the historical data, not someone's opinion, not a sales pitch from a whole life salesperson, but historical data of the stock market. This is not debatable. That's clarity. Now watch, Clarity leads to confidence, which Dave mentioned, and then confidence leads to courage. That's the formula. Clarity gives me confidence and confidence gives me courage to step into confrontation, to step into a future that I want to make and not worry about what everybody else thinks.

1:33:57Dave Ramsey:Now, my need to make that whole life agent happy is precisely negative two.

1:34:03Ken Coleman:Thousand.

1:34:28Dave Ramsey:I was sick and tired of being sick and tired. Bankrupt with a toddler and a brand new baby at home. Scared doesn't even begin to cover it. But I got mad enough to change. I started using God's and Grandma's ways of handling money. That journey became the total money makeover, a plan everyday people can use to take control of their money. Millions have changed their lives following the plan in this book and found hope. Start your makeover today at RamseySolutions.com slash store.

1:35:21Dave Ramsey:Michael is with us in Minneapolis. Hey, Michael, welcome to the show. Thank you. Thank you.

1:35:27Ken Coleman:So to keep it brief and straightforward, I am 22. I currently came into a career job of making$25 an hour, and I come from a poverty lifestyle of bouncing around from homelessness, shelter, stuff like that. I've got a recent opportunity to live out here with my older sister and took advantage of it. They got me a career job, but now I'm in the situation of I'm making more money than what I'm used to and what I know what to do with, which is roughly around$4 ,000 a month. And to me, that's a lot of money coming from the lifestyle that I live, but I also cannot learn to apparently budget my impulse control or my want to need.

1:36:08Ken Coleman:And not to mention the around, I'd probably say like a thousand and something dollars in debt for just my medical bills alone. And I'm here seeking place on how to learn to budget and what I should do to maintain it.

1:36:24Dave Ramsey:I'm so proud of you, Michael. Well done. I'm so proud of you. Well done. Man, that's amazing. You've made huge strides. Look Look at how far you've come. I mean,$4 ,000 a month is never a problem you had before. Now it's a problem. I love this. Isn't that great? Yeah, it is. I really appreciate that. I mean, that's great. I'm proud of you. That's amazing. Good for you. All right. So all we got to do now is make this money behave. And the problem with my money and the problem with Michael's money is the guy in the mirror. You've already identified that. You said it very clearly. If I can get the guy in my mirror to behave, I can be skinny and rich.

1:37:10Dave Ramsey:But he eats too many donuts and spends all his money. You follow me? Yeah, that's correct. That's it, man. So, I mean, that's everybody. And you're very wise and very self-aware to say, I've got to control. The ownership of your words are fabulous. I've got to control my impulses. and I have to make this money behave instead of I don't want to blow this opportunity. This is the first time I've started winning and I don't want to lose. That is amazing self-awareness. You are in a really good spot, sir. So the way you do this is with a plan, okay? And the plan is I'm going to write down before the month begins.

1:37:53Dave Ramsey:In this case, I'm going to put it into an app called EveryDollar that I'm going to sign you up for and I'm going to pay for it. No cost to you. Okay? My gift. I want to be part of your story because your story is awesome. So in the app, you're going to give every dollar a name before the month begins. You are going to tell your money what to do before you get your money. And then you're going to follow that plan like your freaking life depends on it because it does. this is how you don't screw up and you put some money in there for fun you got no overhead you're living with your sister it's not costing you anything what's your over you got a thousand dollar bill for medical that's it right you got to buy some gas for your car you got a car

1:38:44Ken Coleman:i do i've recently bought a car for three thousand but i also as an agreement what happens is i pay thirteen hundred dollars a month in rent and what my brother-in-law does he puts it in a separate bank account that I don't have any control over.

1:38:57Dave Ramsey:So when I move out, he gives me everything that I put into it back so I can go get my I love your brother-in-law and sister. They're amazing. They are giving you a shot, man. Okay, so we got$4 ,000 minus$1 ,300. So I got$2 ,700 I got to do something with, right? I got to put gas in the car, right? So there's an item in the budget. I need to buy some food. There's an item in the budget. I need to pay off the$1 ,000 in debt. There's an item in the budget. I need to have some fun. Hello. Is that okay? I am. Yep. So. Where are you blowing your money now?

1:39:38Ken Coleman:More than anything, I'm going to be completely honest.

1:39:41Dave Ramsey:It's more than likely the fact of my enjoyment. So. Okay. What are you doing to enjoy it? What are you doing? What are you spending on?

1:39:49Ken Coleman:I bought a PC payment, and I bought a straight PC. It was$1 ,200, but instead of just paying it 12 out of our pocket, I'm building my credit and putting it towards a credit card for a monthly payment.

1:40:01Dave Ramsey:And that costs me$100 a month. Oh, you bought a PC, a personal computer? Yep, a gaming computer that I've always wanted. Okay, so the enjoyment is your gaming. And that's where my impulse comes in. Your gaming. Correct. Okay, all right. So when you were in the poverty situation homeless before, did you have any kind of an addiction problem? I did not. Good, good. Okay. So beware of gaming because it's a bottomless pit of time. Well, the good news is about that with my work, with my career,

1:40:35Ken Coleman:I work seven days straight on rotating shifts. So every week I work a different shift, and I work seven days straight and get two days off. I don't have too much time to really game and get addicted.

1:40:45Dave Ramsey:No one gets rich building their credit. So the first thing we're going to do is just pay that loan off too. I don't care if you build your credit. I don't want your credit built. I want you to pay cash and stack cash. I appreciate that. So I want to see how big a pile of cash we can stack while we have some fun. And some fun includes other human beings, not just gaming. Correct. Okay. So like go out on a date or go out with the guys and have a beer or whatever that, have a coffee, I don't care, whatever it is. Plug into a good local church. There's some really good ones in the Minneapolis area.

1:41:24Dave Ramsey:And start to build your spiritual life, your social life, and your financial life simultaneously and create a rhythm. Be careful who you choose to run around with because you're going to become them. Yes, sir. So do you want to hang around disciplined people, people who are in control of their faculties or people who are drinking all weekend? Or are we going to hang around with drug heads? Are we going to hang around with – because you're going to become who you hang around with. So choose that very carefully. And you have got just such a framework to go win. So we're going to put you into Financial Peace University.

1:42:02Dave Ramsey:I'm going to send you a copy of the Total Money Makeover book. I'm going to put you in every dollar premium so that you can do all these things. But if you'll lay out that budget and then stick to it, $1 ,300 to sister, brother-in-law, okay? Gas is this much. Food is this much. Fun is this much. I need to pay the PC off. I need to pay the medical bill off. I need to stack some cash and stack some cash and stack some cash. I need some money to go out with my friends. and you line item every one of the$4 ,000 where it's going to go before you get it in your hand. And then when you get it in your hand, in a sense, emotionally, it's already spent because you already spent it in this app.

1:42:44Dave Ramsey:You've just got to execute. That would help out a lot. I appreciate it. Yeah, so you're happening to your money instead of your money happening to you. Okay, the people that become wealthy are the people that are proactive. active, they make the money behave rather than wondering where it went. And I know people that make$100 ,000,$200 ,000 a year don't know where their money went. They're just as broke as you. The difference is they're not even as self-aware as you are.

1:43:13Ken Coleman:Michael, is your sister or brother-in-law, are they disciplined and wise with money in your opinion? Yes. So they currently were in a very similar situation and own a very nice house. Okay. Well, the reason I'm asking that is they broke the poverty cycle. Yeah. And so don't everything that Dave's giving you from advice to every dollar is great. But don't do this alone. And so absent of a wife, a spouse on this, have your sister work with you on it. Your brother-in-law, he's been very helpful to you in the first 90 days of work in this budget. Just get some accountability and somebody with a set of eyes on this and follow our baby steps, follow the plan.

1:43:55Ken Coleman:and you're going to be fine. Second thing I would challenge you on, I'm not anti-gaming at all. However, if you look at the data and you look at successful people, I'm going to challenge you to read at least half amount of time that you would normally spend gaming. Start reading books of people that inspire you, people you want to learn about. If you do that, I think you're going to see tremendous growth. So read, buy books, less games. Split it in half and see what happens.

1:44:23Dave Ramsey:Ooh, good one. read biographies of successful people. That's right. And I just bought a new one on Mark Twain yesterday.

1:44:31Ken Coleman:I'm reading it as well. Cherno?

1:44:32Dave Ramsey:Yeah. Yeah, I'm almost done with it. Fabulous. A guy I was with at dinner last night said I had to have it. It's fabulous. Almost done. I ordered it last night. Wow. All right. There you go. See? Read about famous people.

1:45:03Ken Coleman:What's up, guys? George Camel here. If you've been thinking about making a real difference in your community, this is your moment. People are drowning in money stress right now, and you can be the one who helps them by leading a Financial Peace University class. It's totally free for you, and we hook you up with all the tools and support you need. So if you're ready to help people ditch debt, save money, and actually sleep at night, go to fpu.com slash lead to learn more. That's fpu.com slash lead.

1:45:50Dave Ramsey:Did you know that two-thirds of Americans die without a will? You're inviting the court, the lawyers, and the public into your most personal part of your life, and they're going to be in control of what happens to your kids. Billionaire industrialist Howard Hughes, known as one of the richest men in the world, died April 1976 without a will. After Hughes' death, over 600 people came forward claiming to have an interest in his fortune. In the end, a judge decided the$2.5 billion would be split between 22 of Hughes' legal cousins in 1983.

1:46:28Dave Ramsey:Years later. Don't let the government decide what happens to your estate. We want to challenge you to create your will in August. In less than five minutes, you can find out if an online will works for you at RamseySolutions.com slash will quiz or click the link in the show notes. And if you want to find out an online will fits your situation, you can get 25 % off when you use the promo code WILLMONTH. That's one word. WILLMONTH. This is the month to do it. and at checkout during the month of August. Very cool. Randy is in Portland, Oregon. Hey, Randy, how are you? I'm really good, Dave. How are you?

1:47:09Dave Ramsey:Better than I deserve. What's up? You have no idea how much I wanted to hear that from you.

1:47:14Ken Coleman:Look, I've been a fan of yours for many years, and I really appreciate what you guys do. Thank you. Yeah, thank you. Thank you. My wife and I want to buy a toy, and specifically a conversion van. And we want to get your opinion about how to go about it. I can give you some details on my financial situation, or you can just start asking questions, whatever you prefer.

1:47:38Dave Ramsey:Okay, so how much is in your nest egg? We have a net worth of about$2.3 million.

1:47:45Ken Coleman:1.6 of that's in retirement, 401Ks and Roths, and the rest is in real estate, which is our house, and we own some land.

1:47:53Dave Ramsey:Okay, good. Way to go, man. How much of this did you inherit? Oh, none. How old are you? I'm 56, and my wife stopped aging at around 40. You are a smart man. Okay, and what's your household income?

1:48:10Ken Coleman:So we have a combined income of about$175 a year.

1:48:15Dave Ramsey:How much non-retirement money do you have? How much non-retirement money? You mean my house and real estate? No, I mean like cash sitting around or an investment that's not in a retirement account.

1:48:27Ken Coleman:Uh, cash sitting around, we only probably have, well, we have about 60 K in savings, but that includes a part of our emergency fund. So.

1:48:36Dave Ramsey:And how much do you have like a brokerage account or anything like that, or just a side, some mutual funds that are not in your retirement?

1:48:45Ken Coleman:Uh, I, I do, but it's not that much. It's probably 20 ,000.

1:48:49Dave Ramsey:Okay. And how much is the conversion van?

1:48:53Ken Coleman:Well, that's the kicker. It's going to be about$110 ,000 to$120 ,000. But the caveat to that is you don't have to spend all of that at once. You can buy the van, you know, like a stripped-out van, and then have it converted. But the two of those put together, you're looking at right around$120 ,000. Yeah. Okay. And what do we want it for or need it for? We really want to get on the road and travel around in conversion van. And we've been looking at that lifestyle a lot, and we really want to do it. Yeah, we want to do it sooner rather than later. What's your plan to do it now? Well, that was a couple questions I had for you.

1:49:32Ken Coleman:I was thinking about, and I think I know the answer to this, but I'm going to ask it anyway. Would it be unwise to stop retirement savings for about a year, a year and a half max, in order to build up cash for the purchase? Would that do it?

1:49:46Dave Ramsey:You're not putting$110 in retirement in a year. No, it would not do that.

1:49:51Ken Coleman:But I think between that and some savings money we had, we could at least buy the van portion of it and then start saving up for the conversion part of it as well. I'd love to do it all at once, but I really don't see it being financially. How old is your wife? For real? She's 60, so she can't. Does she have money in a 401k? She does not, but she has it in her Roth. How much is in her Roth? She's got about$80K in her Roth.

1:50:21Dave Ramsey:Okay. Because she can cash that out with no penalty and no taxes.

1:50:25Ken Coleman:Yep. That was one of my questions as well. Would that be smart?

1:50:29Dave Ramsey:I don't know if that would be smart to do it. That's why I wanted to do it. I'd rather not. I'd rather not because that's going to grow tax-free for the rest of her life, and you can't put it back.

1:50:37Ken Coleman:If you had the van today, are you working remotely? Would you just start doing this now and continue to work? No. No, I wouldn't. No.

1:50:47Dave Ramsey:So what's the timeline then if you have to work? Why would you buy it? Why don't you just buy it all at once when you're ready to go? That's what I'm asking.

1:50:56Ken Coleman:Well, we'd rather. We really want to start traveling now. We really don't want to wait.

1:51:01Dave Ramsey:And, you know, it's a toy for us. Oh, definitely. Okay, so number one, you can afford it. Okay? Yeah. You just don't have the cash. Yeah. Correct. It's not out of line for your net worth. It's not a shocking purchase. It's not ridiculous. Anything like that. You just don't have enough liquid non-retirement to get to it. Okay? That's correct. So you're 56. Are you going to use this after 59 and a half? Absolutely. Can you wait until then?

1:51:31Ken Coleman:I could. Yes, I could. We could, yes.

1:51:35Dave Ramsey:Okay.

1:51:37Ken Coleman:But, you know. Okay, I'll tell you what I would do.

1:51:40Dave Ramsey:Here's what I would do, okay? You make$175 ,000 a year. I'm going to spend some money on travel and enjoy the travel that I would have done with this van without the van by renting some ones or some RV rental program or whatever it is until a 59 1⁄2, and then I'm going to take enough out of your retirement and pay cash for it.

1:52:02Ken Coleman:Okay. That sounds good. Yeah, I was trying to get options on what to do, and I really never thought of that portion of it, is the waiting part.

1:52:14Dave Ramsey:Here's an interesting thing, too. Sometimes when people are getting ready to buy a vacation house, a beach house, a lake house, or whatever, I ask them to rent one for a week or a month and see if you're really going to use it. Right. And so if you go rent this RV, you may learn. It will inform the design of the one you finally purchased. You'll find things about the RV that you hate or the entire experience that you hate and you thought you were going to love. I see. Yeah. Okay. I never really looked at it that way. Yeah. And I have known people to rent a beach house and say, I never want to go back.

1:52:52Dave Ramsey:And they didn't never buy, you know, and I've known people to do that with ski houses in the mountains and lake houses as well. So because it's, it's, you know, that per use, you can rent this cheaper throughout the rest of your life than own it.

1:53:08Ken Coleman:Correct. That would be correct. Yes.

1:53:10Dave Ramsey:Yeah. And So I'm okay with you just renting it for a while and then deciding the design based on your learnings.

1:53:18Ken Coleman:That's where I was going with that line of question. Until you can go all in. In other words, he has to work and he can't work remote. So he can't go all in. In other words, enough to justify this purchase at this point. So that's where I was headed. He's got the itch right now. He's got the itch. Trying to scratch the itch. But I love the idea of renting and let's go and travel while we can. But he's limited in how he can travel anyway with a full-time job. what's interesting is i mean you could i mean cheaper than we're talking about you can charter

1:53:43Dave Ramsey:a freaking jet cheaper than we're talking about that's true you know and so depending on where you're going but um you can do a lot of stuff here so i'm not suggesting that but i am just saying it's interesting to me what you can get into and you know what you can purchase a jet for versus charter a jet you know that informs you you know that's right and over a three-year

1:54:03Ken Coleman:period he can save a lot more plus the roth you know what i mean so it gives him a runway

1:54:08Dave Ramsey:Leave her Roth alone. That's right. Yeah, let's leave that thing alone and let it grow. And then if we're going to do it out of retirement, let's take it out of his because he's probably got some traditional.

1:54:17Ken Coleman:You know what I'd love to see? I'd love to see you and Sharon do a van trip. Conversion van. Dave and Sharon driving over the continental U.S. Why? You don't like me?

1:54:29Dave Ramsey:No, I just think just seeing you two in a conversion van for some reason just made me laugh. I know because you know I would be in hell. I know both of you too well. Sharon and I will be like, no.

1:54:40Ken Coleman:No chance you make it through three states.

1:54:41Dave Ramsey:No chance. No chance. When I go through Arkansas and it starts going, blum, blum, blum, blum, blum, blum, blum, blum, I'll be done.

1:54:48Ken Coleman:Oh, gosh. I don't know why that popped in my twisted head. Your head is twisted.

1:54:53Dave Ramsey:It is. It's going to get twisted right off your neck if you keep it up. I know. I hope I'm back.

1:54:56Ken Coleman:I hope I make it to the next segment.

1:55:14Thank you.

1:55:47Dave Ramsey:Our scripture of the day is Exodus 15, 13. If you're unfailing, in your unfailing love, you will lead the people you have redeemed. In your strength, you will guide them to your holy dwelling. Zig Ziglar said, lack of direction, not lack of time, is the problem. We all have 24-hour days. George is in New Jersey. Hi, George. How are you? Good. How are you? Better than I deserve. What's up?

1:56:13Ken Coleman:So my family owns a business. It's a hotel. I've been working for them for five years now out of college. I have a degree in entrepreneurship. And recently I had a talk with my mom, who's a business owner, about a raise. I make a little over$60 ,000 right now. in New Jersey houses cost a lot, especially in the county we're in. And she essentially told me she can't give me the raise to be where I can afford a house, which is understandable. But my next question to her was, what is the timeframe for me to inherit the business? Because it was always spoken of. And I don't believe I'm at that point right now, maybe in five to six years I can see myself doing that.

1:57:01Ken Coleman:I'm 28 years old. And essentially she said basically not until she passes away. She's 66, so that could be 20 to 30 years, 25 years. So in other words, I don't know if I want to stay and put my heart into it or if I should leave and find another job where I can make more than what I'm making.

1:57:25Dave Ramsey:I think you should leave.

1:57:30Dave Ramsey:Okay. This is not good for you.

1:57:37Dave Ramsey:You have the ability to make$100 ,000 a year. You're being underpaid. If you're underpaid by$40 ,000 a year for the next 20 years, the hotel's not free.

1:57:49Dave Ramsey:Definitely. Your mom's not got a situation that has enough to feed both families. They're not making enough to feed both families, so they're going to have to run it another way. She could pay somebody else$60 to do the job, probably.

1:58:05Ken Coleman:Yes, and also this is, she has two preschools, so those were her main source of income, which it paid for, like, my family's finances and everything, and then it was my dad's business, the hotel, and then she took over, so this was kind of, like, their extra money, essentially.

1:58:21Dave Ramsey:Yeah. Well, but she doesn't want to share it right now, and it's hers. That's her option. But she told you the game, and it's a fair response. She's the owner. She gets to decide that. But it also doesn't work for you. So I'm not mad at your mom, and I don't want you to be mad at her. I don't think she did anything wrong. But she's not incentivizing you to stay.

1:58:48Ken Coleman:Why were you puzzled when Dave said what he said? Because I was under the impression, the way you worded the question, that that was the way you were leaning. is that you should leave. Is that true or false?

1:59:01Ken Coleman:It's true in a sense. But from a kid, like essentially my mom gives me the responsibility of doing owner stuff. Like if a pipe breaks, I'm there, which I'm currently managing the business. So if it breaks at like 2 in the morning, I'm there. We had bricks fall from the side of the building, I'm there. I'm in charge of getting quotes, and she has me deal with the DEP when they come and stuff like that. And when I question her...

1:59:28Dave Ramsey:No, you're just a manager. That's what a manager does.

1:59:30Ken Coleman:Yeah. So your response is curious to me. So you know that there's no future, and what Dave said is spot on, and that's the way you were leaning. And when I challenged you on it, you just kind of went a little misdirection. So what is the real emotion of cutting ties with this? Because there's something there you need to identify, and I think you know what it is. What is it? um my grandfather came from greece and built a business and i don't want to like give up the family legacy i kind of feel obligated to stay all right let me ask a question if you were to move on and go do your own thing are you not still or do you forfeit the inheritance uh no i don't she said i can always come back to it later on in life Then I'm with Dave 100%.

2:00:17Ken Coleman:There's no risk here. I'll come back when she dies and I own it. And you keep your grandfather's legacy alive. I love your answer, but there's nothing in this conversation or in the terms that make this a risk. So I'm with Dave 100%. Go do your thing, man. Go build something. Go learn how to do something and fly, man. Stretch and grow. And then, A, mom may change her mind. We don't know. And B, if it is 30 years from now, the legacy continues and you've gone out and prepared yourself to really grow this thing or do something special with it.

2:00:52Dave Ramsey:Yeah. Okay. One of the things I've told my kids in writing in the trust and in the estate documents is do not keep something around just because the old man started it. I don't want my kids chained to a legacy of stuff. I want them chained to a legacy of principles. And the principles are we run a business that serves people and serves the family simultaneously. But please don't keep something around because the old man, I don't want my kids saying what you just said about your grandpa. I don't think your grandpa wanted you to say that. I don't think he wants you to work for less than you could earn in order to keep open something that he started 50 years ago.

2:01:40Dave Ramsey:That was not his reason for starting it. His reason for starting it was to create prosperity for the family, but not to chain his grandkids to something where they were being underpaid. That was not his intent. I'd be shocked if he said that. Wouldn't you?

2:01:59Ken Coleman:Very.

2:01:59Dave Ramsey:Very. Yeah. Yeah. So I think you've already, I think your mom has said her piece and you say, mom, I'm going to go ahead and give you some notice so you can start looking for a new manager. Cause I'm going to start looking for something where I can afford a house. And, um, and I'll, I, you're my mom. I love you. I'll always be there. I'll try to help you any way I can, but I can't do this anymore. It's not working for me and it doesn't work for you for, to have a different arrangement. And I understand that. And so I'm accepting your decision, and I'm going to – based on that, you know, in about 30 days I'll be gone.

2:02:36Ken Coleman:Okay.

2:02:37Dave Ramsey:And then I want you to put your heart and soul into it while you're still there. Be the best version of George, the best version you've ever been as a manager. And in the meantime, go get something where you're making$100K, right?

2:02:50Ken Coleman:Definitely.

2:02:51Dave Ramsey:Yeah. And I think you can, don't you?

2:02:54Ken Coleman:Definitely. I mean, this gave me a lot of experience of managing a business and employees and inventory and finances and everything.

2:03:02Dave Ramsey:So I'm not sure she can replace you for 60.

2:03:07Ken Coleman:She can't. She doesn't even know how to check somebody in.

2:03:10Dave Ramsey:But I mean, if she hired somebody to do all that, I'm not sure she could hire that position. Yeah. That's on call for pipes busting, bricks falling and checking people in 24-7 for 60 grand in New Jersey. I'm not sure she can. She might. but I'm not sure she can. So maybe this is her wake-up call. Is the business, the hotel profitable?

2:03:32Ken Coleman:Yes.

2:03:33Dave Ramsey:So what's she putting in her pocket? You're seeing the books, right?

2:03:38Ken Coleman:She really doesn't put too much in her pocket from it.

2:03:43Dave Ramsey:So it's not that profitable.

2:03:45Ken Coleman:Well, she's mostly taking the money and reinvesting it into the place and redoing hallways. Yeah, so it's not that profitable.

2:03:52Dave Ramsey:Yeah. By the time she does renovations that are required to keep the thing running, it's not really making a profit.

2:04:01Dave Ramsey:So it might not be a good business to own.

2:04:07Dave Ramsey:Right? I mean, if she has to pay somebody$100 ,000 instead of$60 ,000, she's going to be losing money.

2:04:16Dave Ramsey:So I'm not sure she's got a great business there. I'm not sure you want this thing at the end of the day. So maybe you want something else. Maybe we sell it and we get something else or something.

2:04:25Ken Coleman:Yeah, the clear thing I'm walking away with, George, is you don't want to be there based on the circumstances. You don't need to be there based on this desire to maybe honor your grandfather's legacy.

2:04:36Dave Ramsey:So move on and let's see how the chips fall. Yeah, I think it's going to be fine. But again, let's give her plenty of notice. Pour yourself into it during the notice. Give her plenty of time to redo this. But she doesn't make enough on the hotel to pay you$100. Probably not. That's what she's saying. I mean, I think that's probably right. He saw the books. They're putting everything back into carpet. That's right. Things run down. It's getting tired. It's got to have some Reno. And that makes sense. That's logical. Wow. Harsh. That puts us our The Ramsey Show in the books. We'll be back with you before you know it.

2:05:10Dave Ramsey:In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

2:05:24Thank you.