Stop Letting Others Call The Shots With Your Money

7:44Rachel Cruze:Not only just for the money's sake, but again, we're going deeper than that. It's for your marriage and for the health of your relationship.

7:49Dave Ramsey:I don't want to be your mother and walk around behind you and clean up your poop.

7:52Rachel Cruze:No, because what you want on the other end is complete freedom and honesty and vulnerability and be like, I'm dying for a new truck. Let's talk about it. Let's see if we can make the numbers work. And then you kind of get to this place and you're like, we can't right now, but let's map out a way that we can get there. Like two grown adults. And that's what you want at the end of the day of you guys having the same set of values, maybe wanting to use your money for different things, but you at least have a plan that you're both working towards. And so that would be the goal, Sam, for you guys. And it probably will take a third party.

8:21Rachel Cruze:I mean, honestly, a counselor to kind of start that that direction that road to healing and getting getting you guys in a new set of value systems, because this is this is a mess.

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10:25Dave Ramsey:Paul is in Richmond, Virginia. Hey, Paul, how are you? Doing good. How are you? Better than I deserve. What's up?

10:34Rachel Cruze:All right. Well, I have an issue with a solar company. I was scammed into making a long-term deal with them, and I was trying to find a way I can get out of it.

10:43Dave Ramsey:How were you scammed?

10:47Rachel Cruze:Well, the sales rep made promises to me that made me, well, I can say made me, but lured me to make the deal. He promised that I would not have an electric bill because the company that, am I allowed to say company names?

11:04Dave Ramsey:Let me hear the story. It doesn't matter.

11:07Rachel Cruze:Well, the company, he said the company was going to pay my electric bill in trade that I pay them for the solar. He showed it to me from his iPad that the company was going to pay it. And also that another thing that was that I could walk away after five years if it didn't work in my favor. So those things were kind of the biggest things that lured me to going on with the deal.

11:38Dave Ramsey:Were those things in writing?

11:42Rachel Cruze:He did not have anything in writing. He told me his contract that he had that for me to sign was on his iPad. So he showed that in writing on his iPad, just not in paper.

11:56Dave Ramsey:And you didn't get a copy of that? He said they don't give out paper copies.

12:03Rachel Cruze:Or an email? Did he email you the document, like a DocuSign? No, he did. He did? He did not. He did not. Okay.

12:17Dave Ramsey:I'm curious, why did that, at the time, why did that bullcrap line not concern you? I mean, he says, oh, you can't have a copy of the agreement you signed. That would concern me from the moment he said that, regardless of what it was.

12:35Rachel Cruze:I agree. I saw it on the iPad. He said this is a contract. So I read it myself and I was like, okay, cool. And how long ago was this, Paul? Has it been the five years or less than? No, it was last April. Okay.

12:52Dave Ramsey:And so the two things are, A, you could get out of it anytime up to five years if it didn't work, and B, that they would pay your electric bill, and they have done neither, I'm guessing.

13:06Rachel Cruze:I found out in July of last year that they have not done either. They didn't pay the electric bill, and that's when kind of everything started rolling.

13:18Dave Ramsey:Yeah, and so when you confronted them about that and said, I need a copy of the contract that the salesman told me this, what did they say?

13:27Rachel Cruze:They sent a copy of it. Obviously, it wasn't the same thing that the salesman sold me. And they just were like, we're not backing out of it.

13:37Dave Ramsey:We got you, and this is where we want to be. Are they still open?

13:46The company that the financing company is.

13:50Rachel Cruze:The company that installed it and that the salesman worked for is under bankruptcy. Okay.

14:02Dave Ramsey:There's a couple of those deals. You need to check federaltradecommission.gov, ftc.gov. There's a couple of those deals that they have shut the solar companies down or they've gone out of business and they are releasing people from the liability of the finance contract because of that. You need to see if this particular company is one of those. I don't remember the names of them, but there's two of them that are floating around out there. One of them was real big with the Obama administration. The whole thing turned out to be a scam, and they ended up dumping the whole thing. It was very embarrassing for the Obama administration.

14:38Dave Ramsey:So if it's one of those, then it may be that you just have to contact an attorney or contact the Federal Trade Commission, either one. But first thing I would do is go on FTC.gov if I were you and Doolopoken around about that particular name and see which of the solar companies are having the debt forgiven because they were scams. This sounds like it could be one of them. If it's not and it's, you know, and yours is not in that bucket, then I would contact an attorney. and we would subpoena the, we would find the salesman who doesn't work there anymore because they're now bankrupt, but I would find the salesman and put him on the stand and invalidate the contract.

15:24Dave Ramsey:Because he puts you into a contract on a fraudulent basis and I think you can be released from that. I'm not a lawyer, but probably going to cost you some money to do this.

15:38Dave Ramsey:but some attorney's fees probably to get this done. And you're going to have to push really, really hard on it. But it's probably worth it because it's probably a lot of money. But I don't have a magic button that you can push that's going to make this go away easy. I don't have that one. The closest thing would be if you're one of those companies that the FTC has shut down. And so FTC, FederalTradeCommission.gov, that's the one you want to check out. and then get on the phone with an attorney if you're not one of those. That's what you would do. Sorry, Paul. Yeah. Now, when I do something that leaves me vulnerable or hurts me financially, I always look in the mirror and go, just like Paul was, Paul owned his part of it, and say, okay, I did something stupid here that left me open.

16:31Dave Ramsey:And so when someone says, oh, we're going to do this, but I can't put it in writing, let me help you with that. That's code for they're not going to do it. If it's not in writing, it didn't happen. And if you don't have a copy of it in writing, it didn't happen. It's just missed. okay and so you know don't get so freaking ginned up by a salesperson or by your need to own a product like i'm going to get solar um to the point that you leave yourself vulnerable for that and i've done a lot of stupid stuff and every time i do something stupid and it costs me money and paul this is going to cost you money it's going to cost you attorney's fees probably before it's over.

17:19Dave Ramsey:Every time it costs me money, I call that stupid tax. And I have paid so much stupid tax in my 65 years on this earth. My goal with stupid tax is to never pay the same tax twice. If I'm going to do something stupid, it ought to be a new stupid thing, not one I did before. And so since I have a whole collection of stupid things that I don't do anymore, now people call me wise. And that's where wisdom comes from. It comes from all the stupid things you didn't do that you don't do anymore that you learn from. So at least go back and say, okay, as soon as that little butt said, you can't have a copy of it, it's only on my iPad, you should have tossed him on his head out the front door.

18:02Dave Ramsey:Get off my property scumburger, you know, instantly.

18:07Rachel Cruze:Have you ever been scammed? This was like a sophisticated scam with like a salesman and everything.

18:12Dave Ramsey:No, that wasn't a scam. It was just a lying salesman.

18:13Rachel Cruze:A lying salesman, Fair.

18:15Dave Ramsey:Salesman lied. Yeah, I've been lied to by salesman.

18:18Rachel Cruze:Have you been scammed? Have you fallen for a scam? No. That's good. Good for you. No.

18:27Dave Ramsey:Not that I can think of. I can't think of one.

18:30Rachel Cruze:Okay.

18:31Dave Ramsey:I probably have, but I just can't think of one.

18:34Rachel Cruze:You know who scammed me last year? Who? The USPS, So I Thought. Oh, the text. Do you remember they texted me?

18:41Dave Ramsey:Yeah, I got a text yesterday from them.

18:42Rachel Cruze:I get them all the time now and I say, I will not be giving you my information because I gave it to them. No way. Yes. I had to get it. You did? Yes. Because I was legitimately expecting a package and it said my package was lost. And so you have to like enter in all your debit card information to pay a fee.

19:00Dave Ramsey:I know.

19:02Rachel Cruze:I know. I was waiting on my package. Oh, Rachel. Winston was like, babe, did you check out? Did you look at the website? And I was like, I mean, I copy and pay. It was terrible. It was terrible. Anyways, I won't do that again.

19:13Dave Ramsey:Fair warning.

19:14Rachel Cruze:And I've saved a lot of people. I told this on Smart Money Happy Hour, George and I's podcast. And I've saved a lot of people. People will DM me and be like, I got the USPS text and I didn't do it.

19:23Dave Ramsey:Your mother got that exact thing two weeks ago and sent it to me and said, hey, take care of this. We need to get this back. Yeah, I know. And I went, no, I'm not going to take care of nothing. This is a scam.

19:32Rachel Cruze:So any calls, any texts, I learned my lesson. I don't trust them. I don't trust them.

19:38Dave Ramsey:USPS does not have your text number.

19:40Rachel Cruze:No. No. hint

19:43Dave Ramsey:neither does the IRS hint neither does a Nigerian prince

19:47Rachel Cruze:hint

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21:36Dave Ramsey:Kim is with us in Nashville. Hi, Kim. How are you?

21:41Rachel Cruze:I'm great. I've saved up, Dave,$1.6 million in investments. I plan to use it for my retirement. I've also been using it as my emergency fund. My question to you is, do I leave my six-month emergency fund in my investment account, or do I pull it out and put it in a bank, or do I put it under my mattress? In the sock drawer.

22:06Dave Ramsey:So it's more psychological than it is mathematical, okay? Okay. Mathematically, you would be fine to just leave it sitting there. and you've got so much money, you've done so good, congratulations, way to go, you're a multimillionaire. You've got enough money that if you need money, if you need$10 ,000 to, I don't know, bury a relative that died broke in Seattle, okay, and whatever, right? I'm making this up, right? But you could just reach over to the mutual fund and do a withdrawal, right? Wouldn't be a big deal. And so mathematically, that's okay. I personally would coach you, though, to set and label something as an emergency fund.

22:52Dave Ramsey:And that's psychological. And the reason is, I don't know if it needs to be six months, it could only be three. That's fine. And just put it in a high-yield savings account at Fairwinds Credit Union or something like that, okay? And just something simple. And the reason is then when an emergency hits, you don't stop and think, OK, is this a good time to pull money out of my mutual fund? Because it could hit the day that Trump bombs Iran and the market drops three percent that day.

23:25Rachel Cruze:And Kim's like, I'll just get a blanket and not fix my meter.

23:29Dave Ramsey:I think I'll just put it on a credit card and pay it off after the bombing is over. You know, this is the kind of crap that goes through our minds if we're only doing math. And it's almost always the way life works. You know what I mean? That the emergency happens at exactly the wrong time. That's part of why they call it an emergency. And so I like having that money sitting over there in a stupid, underperforming, high-yield savings account. Not doing nearly. They're not stupid. It's not doing nearly as good as my investments. That's what I mean by stupid. Okay? But its purpose is not to invest.

24:05Dave Ramsey:Its purpose is a buffer for me to keep my hands off my investments. Gotcha. So that's psychological, right? Yep. If 100 % of the time we all knew we would dip into the S &P index fund and pull the money out for the emergency, no matter what the market was doing, but we just don't. we always play these mental gymnastics with ourselves. And so I just, I have to trick myself into being smart. Yeah.

24:38Rachel Cruze:Well, and for me, there's just like an ease to having that high yield savings account. And we do, we have fair ones and it's on the app and we have that. And then we have a whole other, you know, high yield savings account that we have for other savings that we're doing, but just that, that emergency fund, it stayed there and we've, we'll beef it up still. Like once I, we still have that and there's just, there is,

24:59Dave Ramsey:The reality is you probably, honestly, Tristan, in your situation, Rachel's situation, my situation, you probably, when you have an emergency, you probably got it in checking. You're probably not even going to touch the emergency fund. But having it there, there's just this weird little thing. And three months is fine. You don't need six. Because you've got a bazillion months in good after-tax investments. And so you're fine. You're not going to have a problem. It's just a matter of remembering that personal finance is 80 % behavior, and I have to account for behaviors when I make these decisions.

25:38Dave Ramsey:So it's an excellent question, by the way. And, again, congratulations. I'm so proud of you. You've done so well. Millions of dollars. Wow. Very cool. All right. Bianca is in Tampa. Hey, Bianca, what's up?

25:54Rachel Cruze:Hi. Thank you so much for taking my call. Sure.

25:56Dave Ramsey:How can we help?

25:58Rachel Cruze:So my husband and I were so thankful we got introduced to Financial Peace University through our church. And I would say over the last year and a half, we paid off all of our debt. Wow. Credit cards, student loan, my husband's car payment. And I mean, we've been kind of working on this before, but we just really started focusing on it after we enrolled in Financial Peace University. And so we're at this point where we have our emergency fund set up. we're doing retirement, putting money away for our kids. But there's a caveat of I'm still leasing a car. And we didn't pay that off because we had this belief of like, it's not really mine anyways, because we've just been borrowing it, leasing it.

26:45Rachel Cruze:And it has$10 ,000 left on the lease for about a year and a half. And I'm wondering if I should just pay that off.

26:53Dave Ramsey:Yes.

26:54Rachel Cruze:Okay. Should I buy out the lease? Is there any benefit to buying out the lease when the car is done? Okay.

27:00Dave Ramsey:No, you're buying it out now.

27:02Rachel Cruze:Okay. So you think I should just pay it off? $10 ,000.

27:04Dave Ramsey:Wait a minute. Is$10 ,000 the remaining payments on the lease or the buyout?

27:08Rachel Cruze:That's the remaining payment for the lease. The buyout is$42 ,000.

27:13Dave Ramsey:Okay. Do you have$42 ,000?

27:18Rachel Cruze:Yes, but I... Do you like the car that much?

27:20Dave Ramsey:If you want the car, pay your car off. If you don't, then you need to sell your car.

27:26Rachel Cruze:And so I guess because I don't own it, it's a lease.

27:30Dave Ramsey:No, you own it. Okay. It's an alternative method of financing, and it's a horrible method of financing. You have a car payment. We need to get rid of your car payment.

27:40Rachel Cruze:Okay. Okay. So just pay off the remaining lease balance, which is$10 ,000.

27:44Dave Ramsey:No, you need to pay off$42 ,000 or you need to get rid of the car.

27:49Rachel Cruze:Okay. Okay.

27:51Dave Ramsey:One of the two. Okay. So what's your household income?

27:55Rachel Cruze:We're around$180 a year.

27:57Dave Ramsey:Okay. Well, you're doing really, really good, except you did some mental gymnastics on whether or not you actually own this car, trying to not deal with it.

28:04Rachel Cruze:It feels like you're renting it, though, is what the lease, like, psychologically makes you feel like it.

28:08Dave Ramsey:This is not Hertz. This is not Hertz. This is Lexus, okay? And so, yeah, pay it off or dump it. It's just like you have a car debt. Just pretend like you have a car payment and a car debt, because you do. You have a car payment, and you have a$42 ,000 payoff. and you have$42 ,000 in the account. Look at the car. Do I like the car$42 ,000 worth? If I don't, it's time to sell the car. If I do like the car, then pay it off and keep it. You can do that, make it$180 ,000. You're doing really good. Everything else that you told me is on point. Yeah, you just managed to do an avoidance technique here.

28:41Dave Ramsey:And I just sidestep that thing and just let it drive on by, no pun intended. Yeah, but no, it's still there. So, folks, here's the thing. And let's go deeper into her position, I guess, on this. Car leasing is now 78 % of the new cars that leave the lot.

29:09Dave Ramsey:And a car lease, when you back out the numbers on it, and a closed-end lease works like this. You have a series of payments. At the end of the payments, you then pay a lump sum to own the car. or you turn the car in. Okay? And you can put those numbers, that stream of payments and a lump sum, into a financial calculator as opposed to the actual MSRP, the sticker price, and back out what the cost is of what's called cost of capital in a lease. And that is your interest rate. On average, it's 14.2 % right now. So you borrowed money at 14 % to buy your car on payments. And the car company knows that.

29:54Dave Ramsey:That's why 78 % of them leave. The lot right now are leases. They make more money on leases than they do putting you on payments.

30:02Rachel Cruze:So there's more lease cars than just having a car loan.

30:05Dave Ramsey:Yep. Yep. And not included in the car debt that we're seeing increase. You know, we've noticed that we hit the trillion mark the other day with car debt. That's not even in the leases because leases are not technically, as she pointed out, considered debt. However, it's exactly what they are. It's a contract to pay payments. That's debt. And it's at a 14 % interest rate, cost of capital. Okay. And guess what? They don't disclose the interest rate. You know why? Federal Trade Commission disclosure regulations do not apply because it's not considered borrow money. So they're sidestepping everything and screwing you people.

30:52Dave Ramsey:Hello, Ford Motor Company. Hello, General Motors. Hello, Toyota. You're screwing people and you're getting away with it.

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32:39Dave Ramsey:Tristan is in Savannah. Hi, Tristan. How are you? Hey, brother. How are you doing? Better than I deserve. What's up? Hey, so my wife and I are getting married next month, and we're blessed to be in a good financial position. But my question to you is, if you're starting over, what principles would you follow to build a strong family and lasting wealth over the next few decades?

33:06Dave Ramsey:Wow. That's an eight-hour seminar. It's a really good question. There's a lot of layers to that. I agree.

33:14Rachel Cruze:And are you asking beyond money, Tristan?

33:16Dave Ramsey:Yeah, he's a strong family. Yeah, yeah, I agree. I agree.

33:21Rachel Cruze:It's beyond money. We're blessed to be in the position that we are financially, so money's not really an issue.

33:26Dave Ramsey:The way the Ramses would view this at my house is it would start with a foundation of faith. And so we would start with a spiritual foundation and say, all right, God is in charge, and now let's learn what he would say about these things. And that's where a lot of the things we teach here on the air have come from is from Scripture. I mean, we present them in a non-scripture, non-weird way, most of the time. But, you know, it comes down to, okay, how are we going to do this? So an example of that would be one of the things I learned when I started over was that I didn't ask my wife's opinion about anything.

34:16Dave Ramsey:I just went and did whatever I wanted to do. And she was okay with that because she was raising babies. and I was running a business. And so she didn't really want to go look at every piece of real estate I was buying. I was in the real estate business and I didn't ask her opinion. And so that's a huge mistake to not be constantly communicating about the items in our life. And so who can find a virtuous wife for her worth is far above rubies. The heart of her husband safely trusts her and he will have no lack of gain. and so once Sharon and I got aligned with I don't make big financial decisions she doesn't make big financial decisions and we're in agreement on a budget without the two of us knowing everything and being aligned on that and so um you know I had some uh 14 year old seadoos at the lake house and so I bought new seadoos the other day at the lake house to upgrade for the grandkids and everybody to ride on, but I didn't, you know, just call up the C-Doo dealership and go bring me some C-Dos.

35:20Dave Ramsey:I said, hey, Sharon, one of them's messed up. We're getting some work done on them. We talked through what the situation was. It looks like the stupid things are, you know, time to upgrade. And we got the money. Any issue with that? No, none whatsoever. But she did not walk down on the dock and go, aren't those new? That didn't happen that way. So we're in agreement. We're in alignment. That's a big deal. And that has saved me. Like we don't make large, uh, uh, uh, generosity plays philanthropy. We don't write large checks to ministries in support of them without the, without us both talking about it and praying about it.

35:59Dave Ramsey:So we make decisions together. That's principle number one, like, and that's a big deal. That saved me a lot of angst in my marriage and my relationship. And it's also saved me a lot of money because it kept me from doing some stupid stuff I would have done probably on my own without her speaking into it. And she might've done on her own without me speaking into it. So, um, I think that a spiritual foundation and out of that comes things like, I will have no lack of gain if I listen to my virtuous wife. And so out of that comes, um, you know, a godly man leaves an inheritance to his children's children.

36:34Dave Ramsey:And so I'm going to plan a, an estate that changes my family tree. And that includes the character of the people I'm leaving the money to. If they're a poor character and I leave them money, uh, it ruins their life because you become more of what you are when you get more money. And so, and we started talking about that to Rachel Cruz when she was three years old, to her brother and her sister when they were three years old. So, you know, you have to be a worthy steward. You know, and, you know, if you're faithful in the little things, you'll be given more to manage. This is a teaching for your children.

37:18Dave Ramsey:So I'm going to teach my children to give so that they don't think the whole world's about them. They're not going to be entitled little brats, right? It's not about you, you know, and so I'm going to teach them to be givers. I'm going to teach them to save, which is a sign that they have some discipline and they can delay pleasure, which is a sign of emotional maturity. I'm going to teach them to spend and enjoy their lives because our Heavenly Father, if we being evil, know how to give good gifts to our kids, how much more so the blessings come from him. And so all of these things come out of that whole mindset.

37:54Dave Ramsey:So, Rachel, you kind of sat and experienced that, I guess, on the other side, being raised in that environment. Imperfect, not perfect. Yeah. But it was very intentional.

38:04Rachel Cruze:Yeah, very much so. And I think, you know, money can easily become an over-safety net, if you will. Yep. And so you have to be careful of this balance. And that's why the generosity piece, I think, is really big. I feel like it does. It keeps you in check. When you write a literal big check to something, there's something that just happens in the character of who you are. So that generosity piece, I think, is huge. And that plays into the character of you. You know, generous people are usually pretty humble people. That definition of humility, I think it came from Rick Warren. But he said, humility is not thinking less of yourself, but it's thinking of yourself less.

38:45Rachel Cruze:This way of servanthood and looking at others, right, and what's going on in them. and it's not all about you. Because money can easily become the center point of your life because you have the ability to go do whatever you want because you have the money, right? And so it can easily become that your life is about you, that orbit. We put them back. Tristan, I was going to ask you, do you guys have kids? Is this your first marriage? We have our first marriage. We are both faith-based. How old are you guys?

39:18Dave Ramsey:I'm 29.

39:19Rachel Cruze:She is 25. Okay. Yeah, that's great. And I'll just say for Winston and I, I feel like one of the things we've learned, and we've been married 16 years, so there's a lot of people who've been married much longer than us that probably have more thoughts on the marriage piece. But I have found the healthier we are as individuals, the better our marriage is. Like when I find that Winston is like working on himself and he's doing work over here. And if I'm doing that, learning and growing over here, like there's something about that where I think for a little piece of me getting into this, I thought marriage is the missing link.

39:52Rachel Cruze:And that's what's going to like create this better person of who I am. And I think the more we've gotten into it, the more I'm like, wow, when Rachel takes care of herself, she's a better version of her. And same with Winston. And it's created a healthier marriage when that's been our perspective. And so there's something there's something great. that. And then the thing that you told us, you told me early on in marriage, which I loved was just serve each other. I think I was so worried about the roles and who's supposed to do what and what marriage formulas it's supposed to look like. And I remember you said, dad, just serve each other.

40:24Rachel Cruze:And there's something beautiful in that each of you has a voice, each of your opinions matter. And so there's not that there, that hierarchy really wasn't, I didn't see that as much with you and mom. It was a very equal level playing field. Yeah. By the time you were old

40:41Dave Ramsey:enough to see it, that was there because of what I just described. Exactly. Yeah. Before you were born.

40:46Rachel Cruze:I think that's big. I think that is for each of you to feel like you are heard and respected is big.

40:53Dave Ramsey:Yeah. Submit yourselves one to another, says in Ephesians. Okay. That's serving each other. You know, and so I'm going to put your needs ahead of mine. I'm going to put the needs of the family unit ahead of my own little selfish desire for a new pair of shoes or purse or a gun or a car or a fill-in-the-blank thing. And there's nothing wrong with any of those things. By the way, Ramsey's have all those things. Sharon this week, Dave this week, you know, every one of those things. But those are not ahead of the good of the family unit's goals. It's not ahead of, they're not going to interrupt my generosity because I bought too many guns.

41:34Dave Ramsey:Right, right. They're not going to interrupt my generosity because I bought some C-Douges.

41:37Rachel Cruze:Yeah, and another myth that I think we can kind of get into as well is that if I just have enough money, there's a level that problems, for the most part, kind of go away because I can just fix them. Do you know what I mean?

41:48Dave Ramsey:No, the more crap you own, the more repairmen you have to know.

41:51Rachel Cruze:Well, that, but also, like, you're still human and people. And you know what I mean? Like, it's still, life is still going to happen. And so it's not this over safety net like I was saying earlier. And there's something that I think, I don't know, we can kind of creep into. And then you're like, oh, gosh, but it's not like I'm not immune to life. It's almost we're worshiping.

42:08Dave Ramsey:We're getting our, we see God is, you don't say God is my provider. You say my mutual fund is.

42:14Rachel Cruze:Yeah, right. Yeah.

42:15Dave Ramsey:And that's a dangerous spiritual ground. Yeah. Yeah, I agree with you completely.

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43:50Dave Ramsey:welcome back to the ramsey show in the fair winds credit union studio kim is in baltimore hi kim how

43:57Rachel Cruze:are you well i've been better um so i'm sort of in a crisis situation at the moment and i really I need some advice. I'm a 53-year-old stay-at-home mom. I've been married 23 years. About three years into our marriage, my husband asked me to quit my career to help open a business. So I did so. I worked in the business with him for about two years. And then we got pregnant, started a family, had kids. So I've been staying at home with the kids for the past 17 years. Since then, he's controlled everything. He doesn't let me have access to any kind of account. I know nothing. He doesn't let me have access to anything.

44:36Rachel Cruze:I get an allowance on the credit card once a month. Once that allowance cuts off, it's done for the month, and I have to wait for the next month to have money again. That allowance is supposed to cover my gas, everything for the kids, food, stuff like that. It's not a very generous amount. How long has that been going on? Oh, that's been going on the better part of the 17 years, pretty much.

45:00Dave Ramsey:Why have you tolerated it for 17 years?

45:04Rachel Cruze:Because I'm an idiot. I was scared. I've been scared.

45:09Dave Ramsey:What are you scared of? Him?

45:12Rachel Cruze:Yeah. I'm scared of him. Yeah. And I'm scared. Like, any time I go up against him, he punishes me by, like, taking stuff away or making my life even harder. And anyway, I have no access to anything. And he gets a text message, even with the credit card. How long has he been hitting you? He doesn't hit me. It's all verbal. He doesn't hit me at all. It's just verbal and financial. Where is your family? They're all gone. I don't have anybody. And he has parents locally that will stop at nothing to help him.

45:53Dave Ramsey:Wait a minute. I don't care about him anymore. So your mom and dad are gone?

46:01Rachel Cruze:Yes. They've been gone for 20 years.

46:03Dave Ramsey:Your siblings are gone?

46:05Rachel Cruze:My sister, yes. She committed suicide. I have one sister, but she's basically not anyone that could give me any support. She's an alcoholic and not in a good place. Do you have kids, Kim?

46:17Dave Ramsey:Yeah, I do.

46:18Rachel Cruze:I have two kids, twins, boys. How old are they? They're 17. But this gets worse. So anyway, I recently found out he's having an affair. Shocking. He's secretly behind my back. Yeah, right. Secretly behind my back. He's in the process of opening a second location of our business with her. So she has somewhere to work. He doesn't know that I know any of this information yet. He recently went to the bank to get a new business loan to open the shop. I don't know how that's going to play into debt. Is he opening this shop and making it look like he has more debt and wanting to divorce me? I did see that he had reached out about looking to get a divorce with an attorney.

47:04Rachel Cruze:His father is his accountant, and him and his father hide everything. Basically, they make it look like the business is a loss every year. but every single thing that he buys right down to his ED medication goes on a business card. So he's paying for everything with business expenses, but then claiming that he doesn't make anything. And like I said, his dad and him hide all of this. So right now I'm in the house with him. He doesn't know that I know that he's having the affair or starting a new business. I don't know what to do. I don't have any funds to get an attorney. In fact, he's laughed at me before in the past when I brought up divorce, and he laughed in my face and told me that I don't have access to money, and that I could never fight him because I can't afford an attorney.

47:51Rachel Cruze:And he's right. So I don't know what to do right now. I have so many legal questions to ask.

47:58Dave Ramsey:Yeah. Let's first establish that he's full of crap, okay? You have access to all kinds of money once your attorney shuts him down and takes half of what is in the accounts. And in Maryland, they'll do that fairly quickly. And so, you know, if you get half of everything that's in his accounts, you've got plenty of money for an attorney to fight him for years. And so he's bluffing or he's an idiot and doesn't know what he's talking about or both. But he's just got you. He's got you buffaloed is what we would call it. It got you cowed, and you believe that he is stronger and smarter than he is, and he's not.

48:41Dave Ramsey:He's not that bright. He's not that smart, and he doesn't have the law on his side. So, yeah, you do need an attorney, and you do need to leave as soon as you possibly can, and you do need to load the kids up and take them with you. But we've just got to figure out where you're going to go. Are you going to go to a domestic violence shelter? Are you going to call your church, talk to your pastor? and then you get on the phone once you get out of there and find some legal counsel that will take on this guy. Because legal counsel can get paid. They just got to get paid out of those accounts that he has control of, and it's very possible, very easy.

49:18Dave Ramsey:You can't give them a$10 ,000 deposit up front because you don't have$10 ,000, okay? But you can explain to them what's going on here, and some good divorce attorney would kind of think this is going to be fun.

49:32Rachel Cruze:Right. They're going to mop the floor with him. I know there's a good local attorney I've called. I have an appointment with her, but it's her first available appointment. It's not until August 18th.

49:45Dave Ramsey:Well, call her up and tell her you have a toxic, abusive situation, and you need to get an appointment sooner.

49:56Rachel Cruze:I've told them that. That's the first they have. I've tried a couple times. They did put me on a waiting list.

50:01Dave Ramsey:Well, then call another attorney. And call another attorney. Okay. You have to be done letting other people set the agenda in your life. An attorney that can't see me until August might not be my attorney. A guy who won't give me any money might not be my husband. A guy who has an affair, probably not going to be my husband. The accountant who's his father and is committing fraud to avoid taxes might go to jail. Right. I mean, by the way, tax fraud is criminal. Right. So what you were describing there not only doesn't survive an audit, but if the IRS proves it's intentional, then all players might go to jail, the accountant's father and the moron husband.

50:49Dave Ramsey:And so, you know, maybe a call to the IRS and say, hey, you've got some players over here y 'all ought to check out.

50:57Rachel Cruze:Am I correct in my thought that he's not legally allowed to be putting all this stuff on business expense? That's what I'm talking about. Everything.

51:06Dave Ramsey:That's what I'm talking about.

51:07Rachel Cruze:I mean, that's not legal, right?

51:09Dave Ramsey:No, it's not. Okay. And at a minimum, it doesn't survive an audit. And at a maximum, it could be criminal.

51:17Rachel Cruze:And depending if they're hiding income and revenue from the company so they don't pay taxes.

51:21Dave Ramsey:Yeah, that's criminal. Right. There's tax avoidance and then there's tax fraud. There's two different things, okay? So anyway, but that's not the issue here. You know, that just is one more notch in the belt that says this is a bad guy. It doesn't really affect you because you're not going to be there anymore. Right, right. So, yeah, are you involved in a church at all?

51:49Rachel Cruze:I am not.

51:50Dave Ramsey:Okay. All right, hang on. I'm going to have Christian pick up, and we're going to hook you up with one of our financial coaches in the area and get you plugged in with a good church and get you plugged in with some good attorneys and see if we can't get you out of there pretty quick because this is done. Terrible. I'm so sorry, Kim. It's a horrible situation. What you've described is not something anyone should stay in.

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53:55Dave Ramsey:John is in Minneapolis. Hi, John. How are you?

53:58Rachel Cruze:I'm doing good. How about yourself?

54:00Dave Ramsey:Better than I deserve. What's up?

54:02Rachel Cruze:Well, I wanted to kind of pick your brain on my situation. So I am debating filing bankruptcy, getting a secured credit card to potentially buy my first house in two years. Right around COVID, I got myself into about 12 grand worth of debt, and I could pay$1 ,500, file Chapter 7, and start saving now. It is relevant to say that I got a better job since then. I now make anywhere between$10 ,000 and$25 ,000 a month.

54:38Dave Ramsey:You make$10 ,000 to$25 ,000 a month, and you're worried about$12 ,000 in debt? Yeah. You realize how lame that sounds? I know.

54:51Rachel Cruze:Yeah, but I'm also taxed at a heavier rate.

54:55Dave Ramsey:Whoopee! You make$25 ,000 a month. You could have lived on 12 and paid off 12 in one month.

55:07Rachel Cruze:So you don't think it's worth it to save the money? Oh, I think it's asinine.

55:13Dave Ramsey:You make so much money. Go pay your bill, dude. It's up and down, Dave. Well, between 10 and 25, cry me a river.

55:23Rachel Cruze:$120 ,000? To 250. John, you got$12 ,000 of debt. That's it.

55:29Dave Ramsey:You didn't call me with$1.2 million in debt. Right.

55:33Rachel Cruze:I guess it does sound silly.

55:37Dave Ramsey:Yeah. Okay, so let me back up three steps, okay? This money, this income is very new, isn't it?

55:45Rachel Cruze:Yes.

55:46Dave Ramsey:Yeah, and that's why you haven't done the calculation I just did. Okay, so if you make$10 ,000 a month, that's$120 ,000 a year. If you make$25 ,000 a month, that's$300 ,000 a year. So you're making$100.5 to$300 somewhere in there in the coming months. But your brain has not caught up with that math yet because you've never made that before. And you certainly hadn't made it lately.

56:11Rachel Cruze:Right. And, well, I'm also, my girlfriend has good credit, and I'm trying to get mine back on track, but I have to take care of the debt first. Well, the bankruptcy won't help that, John.

56:22Dave Ramsey:Bankruptcy puts you out of the house business for two to three years. And by the way, they're not going to let you file Chapter 7. There's a means test when you go to file a Chapter 7, which wipes all the credit card debt out. And the means test says, looking at your income, do you have the ability to pay this back? And the judge is going to go, uh-huh. And they're going to throw you into a Chapter 13 for five years. So your plan's not going to work, even if I would go along with it. And I'm not going to go along with it because it's not good for you. So what would be much better? so you were making nothing before hardly.

56:59Dave Ramsey:I mean, you must have had a low income before, did you?

57:03Rachel Cruze:Like six to eight grand a month. Yeah, it wasn't that much.

57:07Dave Ramsey:Well, that's more than I was thinking.

57:09Rachel Cruze:Not bad, John. What's your lifestyle like? I don't understand.

57:13Dave Ramsey:What are you doing with all this money?

57:14Rachel Cruze:If you don't have a house, how much is your rent? My rent is only$900. And I had a repossession of a vehicle, And I've since cleared off a lot of my debt, but I still have this chunk hanging. And I went down, I bought two used cheap cars that we got in on trade at the dealership, so I had good deals on. And so I haven't planned on, that's what I kind of do, is just plan on keep paying cash for vehicles. But my girlfriend, I want to upgrade her vehicle, and I'm also helping her wipe out her credit card debt. John, you're talking about filing for bankruptcy and upgrading your girlfriend's vehicle in one sentence.

57:58Rachel Cruze:No, no. I think your priorities are all over the place. Do you feel that? Do you feel chaotic?

58:03Dave Ramsey:Do you sell cars for a living?

58:06Rachel Cruze:I'm a finance manager at a Ford dealership.

58:08Dave Ramsey:Okay. I thought so. Okay. All right. So let's slow down a little bit. All right. Girlfriend has started to become, in this conversation, high maintenance. She wants a car. She wants a house.

58:21Rachel Cruze:She doesn't want a car, but she gets nothing until you get your grown-up life straightened out, honey.

58:29Dave Ramsey:You've got to get your grown-up life straightened out, and you don't be buying cars for people you aren't married to and buying houses for people you're not married to. And you certainly don't do that to make them happy because they're not worth being married to if that's what makes them happy. So warning, warning, warning, okay? Okay, so now, so we're going to set her aside and let her have her little life while we date her. And we're going to look at John. Now, John makes six to eight to 10 to$25 ,000 a month. So I want John to sit down and say, do the math. You know how to do math. You're a finance manager, for God's sakes.

59:12Dave Ramsey:Sit down and do the math and say, okay, where is my$10 ,000 going? Where is my$12 ,000 going? Where is my$8 ,000 going? And then make it behave. I want you to buy food, shelter, clothes. You have$900 rent. Very good. Okay? Pay the cars off. Any car that is in your name needs to get paid off or sold, and you need to clear these debts. Now, then, as you know, you're sitting in the chair looking at credit reports every day. Credit reports age out. Anything that is not a bankruptcy stays on seven years, but approximately three to four years out, an old repo, an old defaulted credit card that has now been paid off and made good, an old repo that has been cleared up and made good, the deficit has been negotiated out, all of that that's three or four years old hardly counts against you anymore.

1:00:07Dave Ramsey:It might bump your credit score, but you can go get a house. But you need to put these things all paid off, all cleared, so you can get the credit report clock ticking. Because when they tick off seven years, they will all disappear. Chapter 7 bankruptcy is 10 years, though, my friend. It stays on there 10 years. And when you have them fill out an application in your office to get a Ford Motor Credit loan, it doesn't say if you file bankruptcy, it doesn't show up on your credit report. it says have you ever filed bankruptcy that and if you say and if you say no and you have that's fraud so the answer is you've for the rest of your life you have to say i filed bankruptcy while i was making fifteen thousand dollars a month and i had twelve thousand dollars worth the debt that would be stupid you don't want to do that i'm at a loss for words that doesn't

1:01:11Rachel Cruze:happen ever i'm just confused i just don't i just can't get in his brain i'm not sure i don't understand his logic no uh maybe she she wants a nice car she wants a nice house and he wants to impress but that has nothing to do with him filing bankruptcy i mean like i just don't he

1:01:29Dave Ramsey:I think it's the shortest way to get there.

1:01:30Rachel Cruze:Of all of it, though, I don't. It just, yeah, it just makes no sense. So, yeah, John, I would make it a goal. Live on$4 ,000 a month. It's plenty with your rent, lights, cell phone insurance, and throw$6 ,000 this month at the debt, and the next month the same. You're completely debt-free. Get an emergency fund. And I would work on John. There's a lot of, you said she wants a new car. It's like, no, no, she doesn't want to. I want it. There's a lot of ego in all of this. I would do some work on John if I were you, John. I would. I'd get to the bottom of what some of this that you're grasping at.

1:02:09Rachel Cruze:You're grasping at a reality that's not there. And it's so interesting to hear you talk about it because I don't know. I don't get it. I'm at a loss. I am at a loss. Yeah. And I think our audience is too. everyone just we all just kept looking at each other like no i don't get it i don't know i don't know well it's and because bankruptcy is the most extreme i think that's it too bankruptcy is the most extreme i think if he called and was like i don't know i'm thinking about doing debt collections and letting it go you know letting it go to be bad debt and be sold and try to negotiate it like even that i'm like okay that's not a smart thing but bankruptcy i'm like that's just the most one one of the most extreme things that you can do to yourself financially.

1:02:55Dave Ramsey:But somebody on TikTok told him that in two years he can get a house if he has no debt starting today. And the best way to get rid of the debt is bankruptcy. And all of that, of course, was TikTok law, which isn't real law and isn't how bankruptcy really works. There's a means test.

1:03:14Rachel Cruze:You were very empathetic with John.

1:03:17Dave Ramsey:When you go in, I'm not. You were the. I'm just trying to help. You were. I'm just trying to make sure he hears me. That's all. John, we are for you. That's not empathy. We are for you.

1:03:26Rachel Cruze:We want you to win. Yeah, I don't want that to be shameful. We're just confused by it.

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1:05:08Dave Ramsey:buying or selling a home is a high stakes event you need a pro in your corner if you you went somebody that didn't get their license three weeks ago and knows your mother from Bridge Club. That's not how you pick your realtor. You get a real estate agent that does a lot of real estate deals. They know what the flip they're doing. They're high octane, high protein. That's how you get to be a Ramsey trusted, vetted real estate agent. If you want to connect with one for free, click the link in the show notes or head on over to RamseySolutions.com slash agent. The Ramsey Show Question of the Day is brought to you by YRefi.

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1:06:05Rachel Cruze:Today's question comes from Max in Ohio. I am a 70-year-old retiree. my wife and I prepared well for retirement and have no debt, including our home. I would like to lease a car for three years and then give it back and repeat the process every three years. At our age, I don't want to worry about paying for car maintenance. Considering that we can easily afford this, is it okay for us to lease rather than buy a car?

1:06:30Dave Ramsey:Leasing a car does not get rid of maintenance. You're still responsible for the maintenance. You're thinking because you're driving a newer car, you're not going to have any need. Oh, he said paying for maintenance.

1:06:42Rachel Cruze:I wonder if the warranty is not included in a lease. If the warranty for...

1:06:46Dave Ramsey:Well, the warranty would be on the new car, whether you bought it in cash or whether you leased it. And the quality of the car, not needing as much maintenance, might be what he's referring to. I want to drive a nice car so I don't have to worry about...

1:06:56Rachel Cruze:Well, he just said not worrying about paying for car maintenance. Yeah. Paying for it, which makes it sound like it.

1:06:59Dave Ramsey:Well, you do pay for car maintenance, but you don't have to pay for it if there's not much. Like a brand new car, you don't have a lot of maintenance on it.

1:07:06Rachel Cruze:Yeah, that's true. So that's what I'm thinking he's thinking about.

1:07:09Dave Ramsey:I want to drive a nice car that doesn't require a lot of maintenance. If that's what you're saying, it's ridiculous to do it the way you're talking about. You should just buy the car and go buy a brand new car. It sounds like you're a multimillionaire. If you're a multimillionaire and you want to go buy a$100 ,000 car, go buy a car. Just write a check. And then three years later, if you feel like that car is getting old, then write another check. Get you another one. And you're going to take a loss on that car. But you're going to take a bigger loss if you lease it because 100 % of the loss in value is built into the lease.

1:07:43Dave Ramsey:So whatever you would lose by buying a new car and trading it every three years.

1:07:49Rachel Cruze:You're paying for it in the lease.

1:07:50Dave Ramsey:You're going to lose more than that by leasing because the lease covers at least that plus a profit, plus a cost of capital.

1:07:57Rachel Cruze:And the interest, yeah.

1:07:58Dave Ramsey:So your theory breaks down. and if you think that leased cars have less maintenance than cars that are paid for that are the same exact car they don't and there is no lease maintenance program now you could rent one at hertz and hertz will keep it but that would be like super expensive right if you want to go over at hertz or dollar rent a car and rent you a car the whole time they'll they'll maintain their car but you're going to pay through the nose for that obviously and that's not what you're talking about so i'm thinking that what he's talking about is that a nicer car doesn't require as much

1:08:32Rachel Cruze:maintenance and if i get a new car every three years i'm like and i don't have to worry about

1:08:36Dave Ramsey:and that and if you can afford to do that and you want to do that i don't have a problem with that at all it's just you're losing a lot of money um in the first three years is when a car loses its most value because cars lose 70 of their value in the first five years and so a hundred thousand car becomes a$30 ,000 car in five years. That's burning cash. But if you got a lot of money, you can afford to do that. Okay. I just bought a brand new Ford Bronco Raptor package. Okay. But I can afford for the thing to be worth nothing in a few years. I can afford for that. It's not going to affect my life.

1:09:14Dave Ramsey:I've got enough margin. And if that's you, you got enough margin and you want to do this, I'm fine with that. You know, that's, that's why you've worked, but don't, Don't lease it. Don't lease it. No, no. Horrible. Horrible. Horrible. Horrible. Did I mention it's horrible? Rachel is in Huntsville. Hey, Rachel, what's up?

1:09:32Rachel Cruze:Hey, Dave. Okay, so I am newly married, and we are in the process of lending a family of five and getting a mortgage, taking care of a rental property, getting it set up to be rented. And still on Baby Step 2. So right now, my question is what to do. Wait a minute. Rental property.

1:09:58Dave Ramsey:One of you that had the house that's going to become a rental property used to be your house?

1:10:04Rachel Cruze:Yes.

1:10:04Dave Ramsey:Why don't you just sell it? So he, that could be a possibility. Yeah, it is a possibility. Clear up all your debt.

1:10:14Rachel Cruze:So it's a tiny home, and it probably wouldn't clear up all the debt. it might bring$130 ,000. And so the house that we're in now, it was a fully remodel. So I have to refinance it because I have a HELOC on it, a personal loan, and the original $60 ,000 mortgage.

1:10:37Dave Ramsey:Yeah, but how much other debt do you all have other than what you just mentioned?

1:10:44Rachel Cruze:I have it all out. So like$9 ,000 in credit cards,$7 ,000 in student loans, an$18 ,000 car.

1:10:52Dave Ramsey:Okay. And then on the house, you've got a first mortgage. It's how much?

1:10:57Rachel Cruze:$170 ,000.

1:10:59Dave Ramsey:And the HELOC is how much?

1:11:00Rachel Cruze:The first mortgage is$60 ,000.

1:11:02Dave Ramsey:I'm sorry,$60 ,000. And the HELOC is how much?

1:11:07Rachel Cruze:$88 ,000.

1:11:08Dave Ramsey:$88 ,000. And a$15 ,000 personal loan.

1:11:11Rachel Cruze:So$170 ,000 total is what our new mortgage is going to be. Yeah, it was just I needed extra that didn't have it in the heel.

1:11:20Dave Ramsey:$75,$150, so$200 ,000. What's the house worth?

1:11:27Rachel Cruze:$235 ,000.

1:11:28Dave Ramsey:Ooh, okay. You maxed this thing out, didn't you? And the tiny house that's worth$130 ,000, what's owed on it? Nothing. Oh, perfect. Sell it. Clear up. 9-7-18-15 and then refinance the 60 and the 88 on a 15-year fixed. Okay.

1:11:50Rachel Cruze:I mean, my husband is really wanting the rental income and already has some wins.

1:11:56Dave Ramsey:That's stupid. We're going to borrow on your home, your$235 ,000 house, to buy a tiny house for rental income. Gross. No. Yeah. And it's effectively what we're talking about.

1:12:12Rachel Cruze:My original question was, you know, like right now with the mortgage, was I going to do a 15 or a 30? And I wanted, you know, my husband's like 15. You're going to do a 15 because you're going to get rid of all this stinking debt. Yeah.

1:12:24Dave Ramsey:When you only got 60 and 88. When you only got 60 and 88 and that's your only debts and you refinance those on a 15-year fixed right now, you're talking about five and a half or so. Which is pretty wild, Rachel.

1:12:36Rachel Cruze:Yeah.

1:12:36Dave Ramsey:Five and three quarters. You're going to be in great shape. You're going to have no payments anywhere. You paid off your car, your student loan, your credit card, your$15 ,000, and, whew, we're free. We don't trade a tiny house rental.

1:12:49Rachel Cruze:Even though the potting home may only bring$130 ,000.

1:12:51Dave Ramsey:I know, but you owe nothing on it, right?

1:12:55Rachel Cruze:Right.

1:12:56Dave Ramsey:Okay, so$130 ,000 in my hand will pay off$15 ,000,$9 ,000,$8 ,000.

1:13:03Rachel Cruze:$9 ,000,$7 ,000,$8 ,000.

1:13:04Dave Ramsey:You can even pay off a bunch of the HELOC. Pay down the HELOC. So don't even do a refi of a mortgage. I think you could pay off the HELOC and everything else and only have your first mortgage.

1:13:18Rachel Cruze:Yeah, with$60 ,000.

1:13:20Dave Ramsey:What's the interest rate on the$60 ,000?

1:13:23Rachel Cruze:$7 ,500.

1:13:24Dave Ramsey:A little rough, yeah.

1:13:25Rachel Cruze:The ones that I'm looking at right now to do the refi of the house HELOC and personal loan, the 15-year is$6.625 and$1 ,700 a month.

1:13:36Dave Ramsey:Yeah, yeah. I wouldn't do that. I'd sell the tiny house and be debt free with$60 ,000 owed on my home.

1:13:42Rachel Cruze:And then the thing is, Rachel.

1:13:43Dave Ramsey:And be 100 % free. Get on a budget with your new husband. The two of you throw your incomes in together and let's go get rich.

1:13:48Rachel Cruze:Yes. And then if you guys want to buy a tiny home and rent it out in a few years, you can do that. No, you don't. Well, if they want to, some people. You don't want to. Dave doesn't want to. Rachel may want to. You, Rachel, you may want to. Yeah. But if y 'all do, just do it with cash. Like this is your ticket out.

1:14:04Dave Ramsey:A tiny home has a tiny market. Nobody wants it.

1:14:08Rachel Cruze:Yep.

1:14:08Dave Ramsey:That's why it's just a fad. Yeah, no, no, no. If you get$130 ,000 for that thing and clean up all of this, this is definitely what you want to do. And then you ask yourself, would I take a loan out on my home that has a$60 ,000 mortgage to buy a tiny home to rent? The answer would always be no. And effectively, if you don't sell it and do all this, it's the same thing.

1:14:51Dave Ramsey:Let me tell you something I see happen way too often. People fall behind on their bills and they wait. They hope it will work itself out. It won't. That's why I recommend Guardian Litigation Group. Here's the deal. If you've missed payments, collectors are calling, or if you're getting letters threatening legal action, that's not something to ignore. That's the moment to deal with it. Because when you do nothing, it escalates. They can take you to court. And if you don't respond, they can win by default. And that gets expensive fast. Guardian litigation isn't a call center. They're an actual law firm.

1:15:25Dave Ramsey:From day one, you're assigned an attorney to represent you. So if things do escalate, you're not scrambling and you're not hit with surprise legal fees. Guardian litigation only gets paid when the debt is negotiated and you accept the settlement offer. This isn't about shortcuts. It's about dealing with the problem before it gets worse. Go to guardianlit.com slash Ramsey today. That's guardianlit.com slash Ramsey today. Attorney advertising. Results may vary and no specific outcome is guaranteed.

1:16:16All right, here's a technique that will help you.

1:16:20Dave Ramsey:It's helped me a lot. Make decisions like our last caller is facing. And it's one of the reasons you will hear me be so incredulous and so quick and harsh to judge on something. Because it's the technique I'm using. I'll just share it with you. Inside baseball. Okay, here we go. It's called a sunk cost analysis. A sunk cost analysis is simply this. You don't make decisions based on how you got here. You make decisions. That's a sunk cost. You make decisions based on where we're going. So five years from today, what do you want your life to look like? not five years ago, all these things happened.

1:17:09Dave Ramsey:You don't do your analysis based on all the trauma or the bad decisions or what you thought was a good decision, but now that you're married, it's not a good decision anymore because you wouldn't do that if you were married and all that kind of stuff. So all that matters now is we're getting married and we're moving forward together. She's got some kids. She has a house. I have a tiny house. Okay. That's all that matters. How we got here or what my little dream was prior to this doesn't matter anymore. The second and the way you can determine the bit. OK, what's going to put me in the best shape five years from today is to reverse engineer where you are.

1:17:51Dave Ramsey:OK, and you ask yourself the question, if I instead of that item, if I had that pile of money in the middle of my kitchen table. Would I buy that item? You can do that with anything. You can look up like, you know, there's an old joke that says there's two great days of owning a boat. The day you buy it and the day you sell it. Right? Which means that usually by the time people get rid of a boat, they're sick of their boat. Now, I'm a boat person. I've got a couple of boats and I'm not sick of them at all. They're excellent boats. They're Mastercrafts. World's best ski boat. There's an advertisement for you.

1:18:26Dave Ramsey:And, you know, so, but I'm not sick of them. And so, but I do know what they're worth. and if I look down on the dock at that boat and I say that boat, that's not true. I won't use real numbers, but let's just say that boat's worth$40 ,000. Okay. And if I had$40 ,000 in the middle of the table, kitchen table, and I didn't own that boat, would I go buy that boat today? If the answer is no way, then sell the boat. Because you'd rather have the$40 ,000 than the boat. That's the reverse engineering of it. So if you look up at her situation and you say, I can rent out my tiny$130 ,000 tiny house for$500 a month.

1:19:13Dave Ramsey:Meanwhile, I can pay payments on$9 ,000 worth of credit card debt,$7 ,000 worth of student loans,$18 ,000 worth of car,$15 ,000 worth of personal loan, and$88 ,000 worth of HELOC. Those payments are going to be a lot more than the rent that that tiny house will bring in. and that tiny house being sold will clear up all of those payments. So the way you would reverse engineer that and say, if I didn't own this tiny house and the only way I could buy it would be to borrow 88 on a HELOC, 15 on a personal loan, 9 on a credit card, 7 on a student loan, and 18 on my car to go buy this tiny house, would I go buy this tiny house by doing it that way?

1:19:55Dave Ramsey:And the answer is, hell no. Not even close. you wouldn't even think about doing that you know not even close you know no way would you trade a 500 rental income for getting rid of all those payments ever no way doesn't make sense and so that's why it's instantaneous for me to give that answer but all i did was i just reverse engineered it is if you didn't own it and you had 130 000 sitting in the middle of the kitchen table, and you could either pay off all of this debt with it, or you could go buy a tiny house, no one in their right mind would go buy the tiny house. It's a ludicrous mathematical equation.

1:20:41Dave Ramsey:Not even close. And it doesn't matter how we got here, that's where we are. So you reverse engineer it and you ask yourself, would I do that? No, I would not do that. It'd be asinine to do that. I'm not doing that. and so that's why we can answer her with such force so quickly and you can do that for yourself anytime you say okay i've got money in a stock my grandpa gave me a stock well i don't care i don't care who i don't care where you got it you have exxon stock and you have four hundred thousand dollars in exxon stock i don't know anything about exxon i've not looked at it lately i don't know what the stock is i'm not making a judgment about exxon one way or the other.

1:21:22Dave Ramsey:But you just ask yourself, if I had$400 ,000 in the middle of the kitchen table, would I go buy Exxon stock? Probably not. Because you were not well diversified, but you just got it from your grandpa. And it's not like it's his family Bible. It's stock. It's not got an emotion tied to it. And so if you wouldn't go buy it again with that same amount of money, then don't keep it. And if you do that, if you practice that exercise, you can make decisions on whether to buy an investment, whether to keep an investment, whether to buy an item, whether to keep an item instantaneously. It's the same part of your brain that says, I'm going to throw all this stuff away because I'd rather have a clean closet.

1:22:10Dave Ramsey:It's the exact same part of your brain that you're using. It's the clutter out. It's a declutter. It's a cleansing process. And you say, Would I do it again if I hadn't already done it? No. Then undo it and sell the car. Sell the boat. Sell the Exxon stock. Sell the tiny house. Whatever it is. But if you go, oh, no, I think in the next five years the best possible investment on the planet is a tiny house bringing$500 in rent on a$130 ,000 investment, which, by the way, sucks as an ROI. But if you really believe that's the best thing, then you should keep it. But you can't possibly believe that.

1:22:50Dave Ramsey:Okay. All right. Katie is with us in Portland, Oregon. Hey, Katie, what's up?

1:22:56Rachel Cruze:Hi. Thank you guys so much for taking my call. Sure.

1:22:59Dave Ramsey:How can we help?

1:23:00Rachel Cruze:So, okay. My husband and I, this week, just combined our finances. This week? Yes, this week. It's brand new.

1:23:10Dave Ramsey:Okay. How long have you all been married?

1:23:12Rachel Cruze:We've been married for three years.

1:23:14Dave Ramsey:How many?

1:23:15Rachel Cruze:Three.

1:23:16Dave Ramsey:Three years. Okay, good. Okay.

1:23:18Rachel Cruze:Yes. We've been together for eight and a half years. And that entire time, it was made very, very clear that we were never going to be combining finances. The reason for that being, he had a previous marriage and through a bunch of different things, ended up having to go bankrupt and had a lot of trauma where finances are concerned. And so I never expected to be combining finances with him, even though it was something I really wanted. But because of our debt and just our situation, he did come to me and finally said, hey, okay, I guess this is something we can try because it was something I was pushing for.

1:23:59Dave Ramsey:That was hard for him.

1:24:03Rachel Cruze:It was incredibly hard for him, and it happened immediately after a big moment of conflict. And so I just think there was a lot of trust. A lot of humility.

1:24:12Dave Ramsey:Good for him.

1:24:14Rachel Cruze:He's a great man. I had been sending him videos of your guys' for a little while, so that may have helped. But, yeah, so my question really just boils down to we've been sitting down trying to figure out how to restructure, how to combine, how to do this smoothly. Oh, it's messy.

1:24:32Dave Ramsey:isn't it?

1:24:33Rachel Cruze:It is.

1:24:34Dave Ramsey:It's a very, and it brings up all the emotions every time you look at a number.

1:24:39Rachel Cruze:And every time I look at him, he looks like he's going to puke and I feel so bad.

1:24:42Dave Ramsey:Just give him a hug. Um, I hug him and remind him that you think he's a great man. Let me just tell you, this is a hard thing you're doing. Okay. But it's worth it. If it is, if it is strenuous and it's causing your stomach to come up in your throat, both of you, that means you're good human beings. You're facing awkwardness to get a better future.

1:25:10Rachel Cruze:Well, we were gifted at Financial Peace University by our neighbors who have become our very best friends. And they are the biggest fans of you guys, and they believe so much in your process. Let me tell you what.

1:25:25Dave Ramsey:I'm big fans of you and your husband. Hey. And I think the way you've approached this conversation and his humility and what he's doing, but that is not going to mean it's going to be easy. I only promise you that it will get easier. When we combined our finances, I almost puked every night because I was used to being in complete control, and I no longer was. I was now accountable.

1:26:09Dave Ramsey:Welcome back to the Ramsey Show in the Fairwinds Credit Union studio. Andrew is with us in Philadelphia. Hi, Andrew. How are you?

1:26:19Rachel Cruze:Hey, Dave.

1:26:19Dave Ramsey:Hey, Rachel.

1:26:20Rachel Cruze:It's good to talk to you guys today.

1:26:21Dave Ramsey:You too. How can we help?

1:26:23Rachel Cruze:So I would like to pick your brain on this question I'm having with myself. and that is to should I leave my current stable job to pursue going back to school for like a more fulfilling job. Okay.

1:26:42Dave Ramsey:What would you be going to school for?

1:26:45Rachel Cruze:So I would like to go back to school to become a marriage and family therapist. Okay.

1:26:53Dave Ramsey:So do you have your undergrad already done? Yes. So you'd have to finish your master's so that you can get licensed and do your practicums.

1:27:02Rachel Cruze:How long is that? Is that a two-year?

1:27:04Dave Ramsey:Two-year. Yeah, it's usually a two-year program. And it costs what?

1:27:10Rachel Cruze:It costs$34 ,000. And then I do have, I did a little bit of research kind of on it. So I'm a veteran, and I have 100 % disability. and then I looked into the, they have a vet center scholarship program, which will pay for 100 % of the tuition. I think they give you like a$1 ,300 a month living expense.

1:27:34Dave Ramsey:Yeah.

1:27:34Rachel Cruze:The only catch to it all is that I would have to, you know, basically have to win the VA for six years to go wherever they need me.

1:27:43Dave Ramsey:Oh, no, I'm not doing that. No? No. Okay. No, because the VA is going to pay you half a marketplace. A marriage and family therapist can make$100 to$100.5. You're not going to make that with a VA. You're not going to make$60 with a VA.

1:27:57Rachel Cruze:Okay.

1:27:58Dave Ramsey:So it's not worth that. $34 ,000 out of pocket, I'd rather do. So do you have any money saved?

1:28:04Rachel Cruze:So I'm on baby step two right now. I got about, I would say, probably like$13 ,000 left to go. Like$1 ,800 on a credit card and$11 ,000 in my original student loans. Okay.

1:28:16Dave Ramsey:So by marriage and family therapist, you mean you would be like opening a practice, charging people an hourly rate to sit down and help them with their issues?

1:28:25Rachel Cruze:That would be the end goal if I did that scholarship program. Oh, I would not do the scholarship program.

1:28:31Dave Ramsey:I've already established that.

1:28:32Rachel Cruze:What are you doing now, Andrew?

1:28:33Dave Ramsey:The six-year trade's not worth it.

1:28:35Rachel Cruze:What are you doing now, and what are you making? Right now I'm a utility locator for a construction company. I'm making about$35 ,000 to$45 ,000 a year. Okay. Okay.

1:28:47Dave Ramsey:But the military has a program that you don't have to go to work for the military. That's just part of your GI Bill. And they'll pay you a stipend plus a bunch of your tuition with no requirement to go to work for the VA.

1:29:04Rachel Cruze:So I've used my GI Bill. You already have used it?

1:29:07Dave Ramsey:Yeah, I've used the full$36 million. Oh, okay. Yeah. What was that used on? That was for my undergrad. Your undergrad. Okay, cool. So you've been pursuing this for a while. Okay.

1:29:23Rachel Cruze:Yeah, it's kind of been a big thing for me since I got out of the military myself.

1:29:27Dave Ramsey:And how much do you receive in disability income?

1:29:31Rachel Cruze:It's about$3 ,900 a month.

1:29:33Dave Ramsey:So call that$4 ,000 a month, plus you make$30 ,000, right? Yes. Okay, so we're talking about an$80 ,000 income.

1:29:43Rachel Cruze:Yeah, I would say about that.

1:29:45Dave Ramsey:Okay. All right. And you sound like the words you're using, you're single.

1:29:51Rachel Cruze:I have a girlfriend.

1:29:52Dave Ramsey:I am divorced, though, and I have two kids. But, I mean, you don't have two incomes and all that, so you've got a girlfriend. No. All right.

1:30:00Rachel Cruze:I'm wondering, Andrew, if you can do some of this while you work full-time and do night classes. I've known one or two people that have done that. And seeing if you can work your way through, it may take you a little bit longer. but to keep the income going so you could somewhat cash flow it. It may not be next year because we'd want you out of debt with an emergency fund before you jumped into all this. That's kind of what was my thought originally because I've been listening to you guys for a while and I know not to take out more loans or anything like that. For sure. Okay. If I want to do this, I've got to cash flow it.

1:30:34Rachel Cruze:I kind of ran the numbers roughly and it's like, okay, I don't really make enough right now to do that essentially. so I have to get all my debt paid off

1:30:43Dave Ramsey:let me back up two steps number one the answer to your question is yes you need to go do this then the only question remaining after we make that statement is how do we do that in the wisest possible way I would rule out giving up six years of my income being in half and trade that for$34 ,000 plus living expenses no thank you I don't think that's a good trade so I'm going to rule that one out if I'm you so that means i have a thirty four thousand dollar barrier and i make eighty thousand if i can find a way to run an adult program an adult master's program and they're out there i don't know what's available in the philly area but they're out there if you could even an online thing and knock out half of your two one of your two years um and you know during that time finish up being debt free have your emergency fund then start saving towards the thirty four thousand and cash flow while working and making 80 that sounds ideal to me um then the second part the third possibility is um some some big move because your your 3 ,900 goes with you wherever you are so the bulk of your income is going to follow you no matter what because that's the disability income so if you could go make 30 uh working weekends building decks and move to a city where you could have an inexpensive master's program and finish this thing up for 34k in two years that's 17 a year you could do that okay what's the nature of your disability uh it's

1:32:18Rachel Cruze:mostly um so you know mental health stuff and then um i have my knee got all jacked up in the

1:32:24Dave Ramsey:military okay so maybe building decks is a bad example okay with a jacked up knee right but i I mean, but, you know, that's why I asked. But anyway, I don't care what you do. I mean, even if you're working the psych ward as an orderly or something to get some practical proximity to what you're going to be doing, but you're making 30 in there and you're working, you know, 312s or something like that, and then you've got the rest of the time off to go to school. So, I mean, just build your life out to where you go do this. I think you do need to go do it. That's the answer to your question. I just want you to do it in a way that three years from now you're sitting in a private practice, and you're going to make your first$100, and then you're going to move towards$150, because a high-quality private practitioner ought to be making$100 to$100.5.

1:33:21Yeah.

1:33:22Rachel Cruze:I feel like it takes a while to get established when you go to the private practice. Yeah, well, it will.

1:33:27Dave Ramsey:But that's the most lucrative route, and it's the route by which you control what clientele you serve the most. If you're working for an institution of some kind, like, say, the VA, they're going to control who your client is. You're not. And that may take a lot of the fun out of this idea, the reward out of this, the psychological reward out of this idea.

1:33:56Rachel Cruze:and see who you want to see.

1:33:58Dave Ramsey:Yeah, I'm like working with people that I don't want to be working with, a group or whatever.

1:34:03Rachel Cruze:And for six years, it's a long time.

1:34:05Dave Ramsey:That's not, you don't want to sign up for that one. No, no, no, please don't do that one. But I do think you've thought this most of the way through. We've just got to get you there debt-free, cash flow in it, and finish up your baby step two and get you there without selling your soul to the company store.

1:34:36Thank you.

1:34:56Dave Ramsey:Hey guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now, you can get that same kind of help anytime with Ask Ramsey. Ask your money question and get answers built on Ramsey principles we use on the show. Whether you're making a decision or just want something explained, Ask Ramsey is here to help. It's fast, simple, and free to use. Go to RamseySolutions.com and try Ask Ramsey today. That's RamseySolutions.com.

1:35:55Dave Ramsey:Investing can be really confusing. Three years ago, for the first time, we did an unusual investing virtual event called Investing Essentials. And it was me and George Campbell, and I basically used, I opened up my personal playbook. How do I do real estate investing? And I showed exactly how the returns work, the details, the nerd it out, right? And how do I do mutual fund investing? And I nerd it out. and how do I view wealth spiritually and nerd it out and all these different things. And we went through my playbook, and then George and I also talked about buckets of investing that we don't do and why.

1:36:38Dave Ramsey:So we went into the details of what's broken about some of these theories that are floating around out there. And we're going to do it again. This is only the third time we've ever done this. And we're going to add a little bit of new material to it, reducing taxes, navigating wills, and building legacy. I'm going to add some stuff in on those things. Tickets start at$199. It's two nights. It's September 1st and 2nd. Investing Essentials virtual event. George Camel, Dave Ramsey. Me doing my playbook with George. My personal stuff. You want to know how Dave Ramsey does real estate? That's what I'm going to do.

1:37:14Dave Ramsey:That's simple. All right. Get yours today at RamseySolutions.com slash events or click the link in the show notes and we'll get you set up. Elizabeth is in Huntsville. Hi, Elizabeth. How are you?

1:37:25Rachel Cruze:Hi, Dave and Rachel. How are you guys?

1:37:27Dave Ramsey:Better than we deserve. What's up?

1:37:30Rachel Cruze:My husband and I are a young married couple. We've always planned for me to be a stay-at-home mom when we have children. Since I won't have my own income for those years during raising our children, how will we make sure to invest adequately for our retirement? Well, Elizabeth, I mean, funding 15 % of your income into retirement is our baby step four, and that's after you're out of debt with a fully funded emergency fund. and if you start young, you guys should be okay. How much are you guys making right now? My husband makes$105 ,000 a year pre-tax, and I'm making$20 ,000 a year pre-tax. Okay.

1:38:09Rachel Cruze:Well, just for fun, how old are you? I'm 20. You're 20, okay. I am. And do you guys have anything in savings right now? Yes, we have$15 ,000 in savings, which is four months of emergency fund for us. Okay. Anything invested? We have invested about$30 ,000 in a Roth IRA on my husband's job, and he's giving 10 % per paycheck. Okay. Okay. Well, just, yeah, I mean, if you guys from 20 right now to let's say 59, which is retirement age, and you contributed$1 ,100 a month, which will get you to about that 15%. And that's if your income never went up, Elizabeth, okay, just on his, like if he never got another raise, and you guys just did that, you'd have$10.6 million at retirement, just from that 15%.

1:39:12Rachel Cruze:Wow. So I think you guys will be great.

1:39:15Dave Ramsey:You're going to have to stay out of debt and keep your emergency fund in place and stay on a budget so that you put$15 ,000 out of$100 ,000 away every year, okay, which is more like$1 ,200 a month. But$1 ,100 is what Rachel ran the number on, and that's fine.

1:39:30Rachel Cruze:I'm so sorry. I missed my$100. No, that's okay.

1:39:32Dave Ramsey:That's okay. But, I mean, you can go to RamseySolutions.com and look at the retirement calculator, and that's what Rachel was using. That's what I just did, yeah. That's how she ran those numbers.

1:39:42Rachel Cruze:We are currently out of debt. We have our house mortgage, but that is all of our debt currently.

1:39:47Dave Ramsey:So you continue to work to pay out, get the house paid off early, while putting 15 % away, while paying cash for everything else you do. And if you do that and he never gets a raise, you're going to have millions and millions of dollars. That's the point. And, of course, if you work for 35 years and you never get a raise, by definition you're a loser. And your husband's not a loser. So the chance you work 35 years and never get a raise is zero, right?

1:40:14Rachel Cruze:He'll be doubling his income. I mean, you guys will look up in your 30s, and you guys will be great. You'll be great. He's probably at the lowest round of his career field. Yeah. Totally. Yes. Yeah, you guys will be completely fine, Elizabeth.

1:40:27Dave Ramsey:If you do it. Yeah, my point is that the calculation is conservative. Okay, so you're going to be fine. but you have to do the budget and live on what you make. If you run up a bunch of stinking car payments and go on cruises, you can't afford and buy couches, you can't afford and spend$40 ,000 redoing the nursery on a credit card. Cause you had a baby and, and like run around being a normal American and then whine cause you're broke. Then you're not going to have any of that money because you're not going to have the money to put money aside for retirement, but you're not going to do any of that.

1:41:07Rachel Cruze:no okay we have three old cars that we love and well i mean you can even upgrade your cars just

1:41:13Dave Ramsey:pay cash for them that's the whole thing there we go well done elizabeth and the beauty honestly

1:41:20Rachel Cruze:for you guys starting at 20 those calculations look different if you're in your 40s and 50s

1:41:25Dave Ramsey:wow that's pretty amazing all right crystal is in boston hi crystal how are you

1:41:31Rachel Cruze:hi Dave and Rachel I'm great how are you better than we deserve how can we help yeah so I am single I have enough saved up for a home but I'm wondering if I should wait and see if I need a partner and get married before buying a home no no you're not incomplete

1:41:56Dave Ramsey:you're awesome you're awesome you're not incomplete well thank you no buy a house now now the thing we would all put immediately after the comma right the after the exclamation point um would be you may change houses after you have someone come into your life

1:42:17Rachel Cruze:okay right and that's what i'm concerned about okay sell it it's a house in two years that's

1:42:23Dave Ramsey:Okay. If you buy a house and you get married and you decide we don't want to live in that area, sell the house.

1:42:31Rachel Cruze:Okay. Are you dating anyone right now, Crystal? No, I just recently signed up for a dating matchmaker. Okay. That's great. Well, I was going to say, I mean, if you had a serious relationship and you guys were talking about marriage and all of that, I probably would pause and just make sure it's the city you want to be in with this person, you know, if they're in the picture. But if they're not in the picture, no, I would keep running your race, girl. You're doing an amazing job.

1:42:57Dave Ramsey:Yeah, way to go.

1:42:58Rachel Cruze:Yes.

1:42:59Dave Ramsey:Excellent.

1:42:59Rachel Cruze:There's more, yeah, there's studies coming out showing that there's more women homeowners than men right now. So you will be part of a wonderful pool. In their 20s, yeah.

1:43:10Dave Ramsey:That's exactly right. And it's going to make you pickier on who you date, too. You're not going to want to date somebody that's going to mess this plan up because you're working a good plan.

1:43:20Rachel Cruze:Yeah, I'm in my 40s. I'm divorced, no kids. Okay. So I'm willing to...

1:43:25Dave Ramsey:I always joke with the guys and say, but be ready to know that after you buy this house, once you find her, she's going to tell you it was the wrong house. But that might not be the case with you. You might find somebody that just loves this house, you know.

1:43:38Rachel Cruze:Men usually have good taste in houses. I would say that, I think.

1:43:41Dave Ramsey:Yeah, I'm just saying.

1:43:43Rachel Cruze:No, Crystal. Yep. Keep moving forward with your financial plan.

1:43:46Dave Ramsey:Do not wait on some guy to come along to make it okay. No, no, no, no, no, no. You go be you, girl. And then the guy will show up when he's supposed to.

1:43:55Rachel Cruze:Yep.

1:43:55Dave Ramsey:In this equation.

1:43:56Rachel Cruze:Yeah. And to your point, Crystal, she threw out like, yeah, but if it's not within two years, you know, all this. Listen, if the right person shows up, marriage and a life with someone and he comes in 12 months and you guys choose to move cities, that's okay. Take the hit on the house. You're going to be fine financially. Right. I mean, like, don't let that be the thing that scares you into not doing it with what may happen. Because if that even happens, that's a great life. That's fine.

1:44:23Dave Ramsey:And to your point earlier, if someone else is listening and you're in a relationship that's getting progressively serious and that two-year thing is real. Yes. Then maybe you do pause then. Yes, absolutely. But she's asking with no one on the hook. You know, no fish on the line right now. And so, yeah, let her be. You're amazing, Crystal. Way to go.

1:44:48Rachel Cruze:Well done.

1:44:49Dave Ramsey:Congratulations. Thank you.

1:45:36Rachel Cruze:Hey guys, Rachel Cruz here, and I love summer. There is more fun on the calendar, more time with your people, and way more chances to make memories. But you know what else there's more of? Spending. Oh, between the extra groceries and gas and camp fees and family trips, it all starts to add up so fast. And before you know it, money stress starts to steal the fun out of everything. And that is why I love the EveryDollar Budget app because it helps you plan your money, track your spending, and find more margin in your budget so that you can put extra cash towards the goals that matter most. Enjoy your summer without the money stress.

1:46:16Rachel Cruze:Download the EveryDollar app in the App Store or Google Play and start for free today.

1:46:37Dave Ramsey:If you're working the baby steps, the best and fastest way to do it is EveryDollar, our budgeting app that helps you work the Ramsey plan. It holds your hand and answers the questions the same as you'd hear on the air. And we're going to walk you right through the baby steps, the fastest way to get out of debt and into wealth. You track your progress. You get personalized recommendations. You get coaching for your situation. It's like having one of us walking with you every day, showing you the next right step and holding you accountable. Start every dollar for free by downloading it in the App Store and Google Play.

1:47:12Dave Ramsey:Brandon is in, whoa, what in the world? So what did I do? Did I do that? All right, let me try again. Brandon, are you with me? I'm with you, Dave. Cool. How can we help?

1:47:24Rachel Cruze:So a little bit of a quick back story. I grew up in a divorced household. I had a relationship with my father at a young age. Wasn't a good one. In my adult age, I decided to not have a relationship with him, especially after I started to have children. due to the way that he lived his life. He lives his life for money, but in a bad way. He is okay with doing things the wrong way, maybe messing some people over in order to get there, alongside just women and just a whole plethora of issues. I got it.

1:48:12Dave Ramsey:So you had to draw a boundary, and now where are we? Sure.

1:48:16Rachel Cruze:All right. So now I have been told that, and I want to clarify, I do not want this money at all, but I have been told that he is putting his will for my two young children, one who's younger than one and one that is seven, to receive all of his inheritance.

1:48:36Dave Ramsey:Cool. How much is it? I don't know because I don't trust anything he says. Well, what do you think it is? He says that it will be millions. What do you think it is?

1:48:53Dave Ramsey:One or two, maybe. Okay. All right. So it's a lot of money. All right. Good. Yes, I would imagine that it is a lot of money regardless. Okay.

1:49:02Rachel Cruze:My concern is a young child who has never met their grandfather getting a large sum of money from them. How can I help guide them and who knows what age they will be when this happens?

1:49:21Dave Ramsey:Right. How old is your dad?

1:49:24Rachel Cruze:He's only 55 now, I believe.

1:49:27Dave Ramsey:So their kids will probably be grown.

1:49:30Rachel Cruze:Correct. Correct.

1:49:32Dave Ramsey:Unless he's in poor health now, you know, they'll probably be adults before they get this money.

1:49:39Rachel Cruze:Right.

1:49:39Dave Ramsey:Okay.

1:49:40Rachel Cruze:Right. And a lot can happen between now and then, too. Right, right. I guess my question mainly is, is how do I, or do I, mention to, I mean, obviously not now, they're way too young, but at what point would I bring this up to them and have this conversation with them, and what would that conversation look like? Well, the problem is that there's a high probability this guy's a high roller,

1:50:12Dave Ramsey:and he might have nothing. Right. He could lose everything. And so we don't want to overplay. That's an actual possibility, okay? So I don't want to overplay this. I certainly would not do it before teenage years And I would not do it And I would gauge it based on if we have any rumors about his health In other words, let's say you heard that he's gotten a stage 4 cancer diagnosis Then, yeah, we're going to have a different discussion Than if we've heard that he's doing great Right? Right Because it's more imminent and we don't know what it is I will tell you this wealth does not ruin children.

1:50:59Dave Ramsey:It exposes the fact that your children were already ruined. So you raise men of character, young boys into men of character. You said they're boys, right? Right, correct. Yeah, you raise them into be men of character, men who know how to work, men who are generous, men who are honest, men who work a system and a plan. and then if they receive this money, it won't harm them. It will just accelerate them. Right. But if they receive the message that they don't have to work and they're going to sit around and be a trust fund baby because someday when their grandpa dies, they're going to be rich and they consequently become worthless, then the money has harmed them.

1:51:44Dave Ramsey:But the money didn't actually harm them. It just exposed the fact that you didn't teach them how to work. Right. Okay. So you go build the men out of these boys that you were going to do anyway, and the further they are into that manhood, the more ready they are to receive and handle the wealth.

1:52:03Rachel Cruze:Right. Okay. And when those conversations happen, if they are recent, right, if you do hear of a health scare, you know, and they're in their early 20s, be honest with them. You're like, hey, he's not doing good, and he said he's going to leave you some money. I have no idea what that means.

1:52:19Dave Ramsey:Yeah.

1:52:19Rachel Cruze:But let's walk, we'll walk through it together and kind of figure out what's a good plan.

1:52:23Dave Ramsey:Here's what a wise young man does if he receives a million dollars.

1:52:27Rachel Cruze:But also, Brandon, the character of your dad, honestly, some people, they don't last in wealth. So he may have that now, today. And he may lose it. Yeah, who knows? Right. Right. I guess partial of my concern was, you know, once upon a time, it was going to supposedly be left to me. And I said, me and my wife had spoke and said that we didn't want the money that we would just donate it. And that was just a personal thing to us because...

1:52:58Dave Ramsey:Where it came from. I know that... I'm sorry. If the money... I know, because it was dirty money. Yeah. Right, exactly. Yeah.

1:53:08Rachel Cruze:Should I allow that to play into my children or just allow them to have the money?

1:53:14Dave Ramsey:No, I appreciate you all not wanting that because you've got a lot of emotion tied up in this relationship with your dad. But money is not dirty. Bricks are not dirty. You can use a take a brick and throw it through a window and be a vandal or you can take a brick and build a hospital for children. The brick doesn't care. And who made the brick? A cocaine addict made the brick or a person of high moral character made the brick. It's still just a stinking brick. And, you know, so the money itself is technically not dirty.

1:53:51Rachel Cruze:But everything wrapped in it and the story of it feels gross to you, which is understandable.

1:53:56Dave Ramsey:You would feel icky every time you looked around it. But for your boys just to get a million bucks and to be able to do something with that and go change the family tree for your grandkids in a healthy way, because they're good young men. They have a spiritual walk. They're quality people that serve and love the community. They love their family. They do conflict well. You know, you've grown some men, right? You do that, this just becomes a blessing. And in the weirdest sort of way from the weirdest possible source, but it does become a blessing. And so...

1:54:31Rachel Cruze:Yeah, they don't have the strings attached to it like you do.

1:54:34Dave Ramsey:Yeah. So, folks, I'll pan back from Brandon a little bit. He was not asking this, but there's around this is the idea. And I get this when I'm working with wealthy people a lot. How, you know, I've worked all my life to build some wealth. How do I not let it ruin my children? We get that question all the time, don't we? And especially in a panel discussion somewhere where we're doing some generosity thing with multimillionaires. How do I not let this ruin my children? And our answer always is money does not ruin your children. It just exposed the fact that you did. so raise good kids, raise children in such a way that they become excellent adults.

1:55:16Dave Ramsey:And the money is not going to do, the money exposes who you are. It exposes who they are. That's all it does. Money magnifies the good parts of your life and character and the bad parts of your life and character and that of your children.

1:55:31Rachel Cruze:Yeah. And the warnings, like even when you look at through scripture, lots of warnings around wealth that you can't ignore, but that can ruin you, the person that made the money and or your children too, right? So there's the natural warnings of it.

1:55:44Dave Ramsey:You did not do something to your kids. It's not actually wrong by becoming wealthy. And you did not do something spiritually wrong by leaving it in your family. As a matter of fact, there's lots of biblical indicators that that's what you should do. David didn't build the temple. Solomon did with David's money.

1:56:07Thank you.

1:56:26Dave Ramsey:You should not feel uncertain about investing, and you don't have to. That's why we created Investing Essentials, a two-night virtual event where George Camel and I walk you through my playbook for investing and wealth planning. We'll simplify everything from 401ks and mutual funds to passing on wealth so you can invest with confidence. Tickets start at$199. Get yours today at RamseySolutions.com slash events, or click the link in the show notes. Okay.

1:57:20Dave Ramsey:Our scripture of the day, 2 Corinthians 4.18. So we fix our eyes not on what is seen, but what is unseen, since what is seen is temporary, but what is unseen is eternal. Milton Friedman said nothing is so permanent as a temporary government program. Okay, Ashlyn is in Knoxville. Hey, Ashlyn, what's up?

1:57:46Rachel Cruze:I'm good. How are you doing?

1:57:48Dave Ramsey:Better than I deserve. How can we help?

1:57:51Rachel Cruze:So my question is should I focus entirely on paying off my debt first or try to increase my income first and how to do so. What are you doing now for work? So right now I am an hourly and commission-based hairstylist in Alcoa, Tennessee. I probably make about$900 a month, and I know my debt is a little bit higher than that. Not bad, but definitely higher than I would like it to be. How many hours are you working? um with my company i'm not allowed to go over 40 so it's usually anywhere from 36 to 38 hours a week a week and you're making 900 a month yes you're not getting paid well no no i'm not but it's the only salon that contacted me and actually was able to hire me in the time period that i needed.

1:58:45Rachel Cruze:Okay, well, I would be looking for work that paid.

1:58:48Dave Ramsey:Yeah. You're living on$10 ,000 a year.

1:58:51Rachel Cruze:You can make more to an Uber.

1:58:53Dave Ramsey:You can make more working half the time you work at Target.

1:58:59Rachel Cruze:Yeah, I've been looking for other salons, but unfortunately, living in Knoxville, it's so competitive.

1:59:04Dave Ramsey:No, it's not. There are not salons paying people$900 a month. No one stays in that situation. That's$10 ,000 a year. You can't exist on that. so I'm telling you they don't have people standing around working 40 hours for 900 bucks now if you're working 10 hours for 900 bucks maybe but you're not you're not standing around there the whole time 40 hours a week making 900 bucks nobody's doing that in Knoxville Knoxville's not that not that depressed and neither is Alcoa Tennessee or Maryville Tennessee

1:59:39Rachel Cruze:see it's one of the franchise locations of a smart style so it's similar to great clips yeah so get out of there yeah i would go go find a nice salon there's yeah they're there for sure in knoxville even if you're working as a you know front desk and you're booking appointments for the first little bit just get your foot in the door if that's what you want to do um more long term you're you're not making enough to exist you need a job today okay today are you living at home are you at home i am okay i'm living with my parents so no rent no okay i do pay for groceries for our family a lot how much debt do you have yeah um my debt is currently at one thousand one hundred and four dollars most of that is from my credit card another is from gym collections that's Making me pay it monthly so I can pay it off.

2:00:32Rachel Cruze:I'm 21.

2:00:33Dave Ramsey:Okay, good. All right. So what you need to do is to set a goal and say at Target, right there in Maryville, they'll pay you$20 an hour. Okay?

2:00:47Rachel Cruze:Okay.

2:00:47Dave Ramsey:Just working in there as a clerk. All right? And so hair is obviously your, you know, hairstylist is obviously your goal, right? Right. So now if I know I can make$20 an hour at Target, then I need to find a place where I can do my craft and make in excess of$20 an hour. And start pursuing both. And so you can work weekends and nights at Target or whatever. I don't care. Making some place making 20 bucks. OK. Up in West Knoxville somewhere. Right at a retail establishment. There's people around there paying that right now in Knoxville, Tennessee today. day okay okay and then also if you can work 20 hours a week on your hairstylist and get started get a chair somewhere to get up start to build your clientele it takes a while to do that if that's what you're doing but the problem is they're paying you nothing and your own commission and the only money only money you're making are walk-ins that aren't your clients because the type of organization you're in that it's just it's just a uh it's a retail walk-in it's not you know a few people in there have clients that are repeats but most of them are just walk-in and whoever's cutting whoever's whatever chair is open they jump in the chair

2:02:11Rachel Cruze:yeah the other stylist that works with me is making a lot more than that she's the only other a stylist there. So I definitely need to be trying to find a salon. It's just been difficult recently because every time that I apply somewhere, I either don't hear back at all after going in person, calling, applying online, bringing in a physical application, or they answer and they say they're not looking for anybody at that moment.

2:02:34Dave Ramsey:Okay.

2:02:35Rachel Cruze:So I've just been trying to find any other jobs in the area that will work either around my schedule or that the salon will work around the schedule for.

2:02:42Dave Ramsey:yeah but honestly if you lost the job you got right now you didn't lose much you work 10 15 20 hours a week and being more than that someplace else and while you figure out this salon thing and get your foot in the door somewhere i don't know who that is or where that is but um i'm going to send you a book called the proximity principle written by ken coleman that talks about what rachel was saying get your foot in the door get even if you're just the receptionist and you get in booking appointments. Then you get started and you get in the organization, you get around people that are doing what you want to do.

2:03:15Dave Ramsey:And that's where jobs come from. It's not just from applications and follow up. Okay. So this is harder than they told you at the school where you went to learn to be a hairstylist and you paid them. They told you this was going to be easy and they lied. This is not easy. Tony is in Jacksonville, Florida. Hi, Tony. How are you?

2:03:47Dave Ramsey:I'm good, Dave. How are you? Better than I deserve. What's up?

2:03:52Rachel Cruze:Man, I hear you say that all the time. Man, I can't believe I told y 'all. Look, I was in the Army for 19 years, and I'm 100 % disabled now. and I've got a lot of debt and I really don't know where to start. I did just land a job. I was out of the Army for like a year with dead-end jobs between here and there making$10 an hour and whatnot. But I got a job at Mars. We make all the combos that go out in the world and I actually got a lead position out there

2:04:30Dave Ramsey:and I'm going to be making around$95 ,000 a year. Wow, good for you. I appreciate that.

2:04:37Rachel Cruze:With that being said, you know, I thought it was a good time. Obviously, me and my wife, we're not going to pull our credit reports when we don't have money to put anything towards our debts. So, of course, when I accepted the job, we went on, we pulled our credit reports, and we, you know, I made an Excel spreadsheet on how much debt we have and kind of like a payment plan. And the only thing that sucks about this job is that it's an hour and a half away, and we don't have the upfront money to relocate at the time. But my main question is, I hear y 'all talk about a lot of resources, every dollar in this book and that book, and really, I don't own a house.

2:05:18Rachel Cruze:You know, I got a car note.

2:05:20Dave Ramsey:Good.

2:05:21Rachel Cruze:And I got notes. I mean, debts. How much debt have you got? How much debt have you got? uh it's around 55 ,000 on what um well my truck i still owe 21 ,000 on it we have a camper i bought a couple years ago that had i owe 11 on you and then the rest is like credit cards okay all right

2:05:45Dave Ramsey:well i personally would sell the camper might sell the truck and as soon as you can scrape the money together to move and get out of that lease and move up closer to work i would that's going to save you a bunch of money. And then I would get on the every dollar budget and start working these baby steps, list your debts smallest to largest and attack them in that order. We'll give you a copy of the book, The Total Money Makeover and give you the premium version of every dollar and get you started. Okay.

2:06:09Rachel Cruze:Yeah. Tony, instead of that Excel sheet, do the every dollar budget, plug in those numbers that you found out and you'll start to see pretty quickly. Okay. Here's what's going out to everything. And then the motivation starts of if we sell the truck, How much does that free up per payment, right, per month?

2:06:24Dave Ramsey:Sell the camper.

2:06:25Rachel Cruze:Sell the camper. What are we paying on that every month? That frees it up. You start selling some stuff and get this moving. And with your income, you guys are going to do fantastic.

2:06:34Dave Ramsey:And you've got the disability coming in from the military. Thank you for your service. That puts us out of the Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

2:06:53Thank you.