“Was I Right To Break Off My Engagement Because of Bad Money Habits?”

26:32Because at every turn, there's a new thing we didn't think about, right? Yeah. When you sell the house upon sale, has it been said that you're splitting 50-50 the equity or has it been said that they get two-thirds? No, no. Like when we sell, I get my whatever, like my down payment that I put. And then, yeah, like whatever percentage I'm in right now, I'm going to get the percentage of the profit. Okay, so it's 50-50. And what is that percentage? Because you've got home appreciation, you've got the mortgage payments you've made, you've got the insurance and property taxes money you've paid in.

27:04So how are you calculating? It wouldn't be 50-50, though, the profit. It's like they would get, I guess, 80 % of the profit, and I would get 20 % kind of thing. Tell me the real number of when you put 50 % down on the down payment, how much was that? No, so I put$45 ,000 U.S. down. Okay, and what did your mom and dad put down? Yeah, so then now they – so over two years, I think I have roughly around$60 ,000, and they have the remaining. So I'm going to have$60 ,000 in this house equity. Okay, what if the house appreciates and doubles in the next seven years? What happens then? You still get the same percentage?

27:41So I think 60 – whatever, 60 percent – sorry,$60 ,000 of$340 ,000, that's how much the house is. Okay. Whatever that percentage is, that's how much percentage I would get for the profit. Okay, so about 18 percent is what you'd walk away with. If the house is worth half a million, then after all fees are paid, you should get 18%. I would have that in writing and have all of you sign it and come to Jesus meeting and say, this has been messy. I love you guys. I don't want this to be living in my head rent free. I feel like it's been a cluster. Can we just get on the same page with one contract that we all sign?

28:12That would help you. We're agreed. That's what we're agreed with. We're good to go. It's just, I find the house like living here with the bills and stuff. I was, I guess, not against, but I was just questioning it because I was like, well, what did me? Because if it's a five by three, then I have to pay, I get to pay lower of the bill. You know? Why don't you move? Why don't you move? Because I just moved. I just moved here. I know, but hear me out. You're so conflicted by this that you called in the show. You're bothered by the percentage that you have to pay. You're bothered by what you have to pay every month.

28:46You're bothered by the agreement as it stands because what George just said, hey, get it in writing that it's 18%. You're like, that's already agreed on. So you're just not happy with the deal as it is. So get out of it before it gets messier and messier and just say, you know what? We did this. I'm not sleeping well at night with this. It's causing something inside of me. I'm just going to move and get an apartment on my own and just be on my own. Fair enough. I mean, why not simplify your life? Yeah. Well, no, because I do think I have a sweet deal. and it works out perfectly because they want someone to watch the house.

29:17You don't think you have a sweet deal. You don't. You called in saying that there's a problem with the deal because you're having to pay part of the taxes and it should be three ways and da-da-da-da-da. What happens when? You called saying that. Yeah, but I guess the question, my question was like, I just wanted your advice. Like, am I, it's crazy for thinking that or is it definitely it's fair for me to pay? No, my advice, my advice is get out of this deal and go rent an apartment. How old are you? 30. Yeah. Get out from under your parents. You don't have to do this with them. Go get an apartment.

29:48Do I think it's crazy you feel this way? No. Do I think it's crazy you got into this situation in the first place? Absolutely. Yeah. Well, no. I give you more context, too. I want a work visa, right? So anything can happen. I have to go back to Canada, too. And I don't know. I think renting. For me, I'd rather buy something than to like. Because right now I'm not paying a mortgage. Really? Because buying is far more permanent than being a renter. Yeah, that adds a whole other layer of risk. If you can't work there anymore, but the house is still tied to you, and now you've got to force sell it, I mean, or still make the payments and you don't have the job, that's scary, isn't it?

30:20No, because we'll keep it as like a vacation home because we've come off into Florida, so it was okay either way. And who's going to pay for the vacation home now? You're going to go, well, they're there more than I am. They go four times. It's like a timeshare now. This is really what this has become. And you're living there mostly solo, you said, right? Yeah. So couldn't they make the argument, well, you're there 284 days out of the year. We're only there 100 days. I think we should split it that way. Could they come back at you with that? Exactly. They might get you to pay more versus less.

30:48This could very much backfire. They're holding most of the cards right now as a majority stakeholder in this venture you signed up for. So that's why Jade's saying, hey, I would cut clean and go, you have some great equity now. You could get out with 60 grand, use that as a down payment on your own place. You probably don't need all the space, right? Right. I don't think it's a bad plan to reset and go, all right, I'm going to let them buy me out. Do they have the money to buy you out without selling? Yeah. Yeah. I might offer that up as one angle to take. And if they're into it, I would cut ties and go, you know what?

31:23I shouldn't have bought family property across the world. That was a risky, weird move.

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33:04Today's question of the day is sponsored by Why Refi. If you're If you've tried everything to fix your defaulted private student loans and nothing's worked, Y-Refi can help. They build custom fixed rate plans based on what you can actually afford. Learn more at Y-Refi.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. Not available in all states. All right. Today's question of the day comes from Justin in Michigan. He says, I need help with my budget. I use the free version of EveryDollar but can't seem to make it through the month without borrowing from my emergency fund. And then I have to replace the funds when I get paid.

33:37My budget reads like I have extra money each month, so I pay that to my snowball. But should I skip a snowball payment for one month to get a buffer in my account to not have to do the borrow payback thing each month between paychecks? Okay, so a couple things are happening here, I think, George. Number one, I think that you don't have a baby step one in place, which is$1 ,000. And I think that might be the buffer that you need. Possibly. It depends on if this money is emergencies. He's borrowing from his$1 ,000 emergency fund. It sounds like that's what he's doing. Yeah. Is he short 300 bucks so he dips into the$1 ,000 starter to get by, then replaces it, and he just stays in this cycle.

34:17Yeah, which means then his budget's not accurate. Yeah. I would have a buffer in your checking account of, you know, 300 bucks, 500 bucks, depending on what your expenses are. I think that's wise because there's always going to be something unexpected. It was a little more than you thought, you know, your groceries and things like that. It's variable. And so life might happen. But I do think there are some other money leaks happening that aren't currently represented in your budget. So I think it's time for a little budget audit and go look at your bank statements. It's probably groceries, food, gas, something you're spending more on than you think.

34:46Yeah, if the math's not math and then your line items are off, you maybe underestimated. You said, hey, I'm going to spend$500 on groceries and you're consistently spending$6. Well, we need to switch some things around so that you're actually staying under the categories instead of going over. So I would figure out which ones are there. Maybe there's a line item you need to add that isn't currently there that represents that money that's kind of been leaking out, and that will help you get there. But I'm proud of you for even trying this and trying to be aware of where your money's going. Most people just accidentally go six grand into debt over the year, and this guy's trying to get out.

35:19So good on you, Justin. Also make sure, Justin, that you're tracking your transactions as they're taking place so that you can get ahead of this a little bit more. because if you're tracking them, you can kind of start to see what's happening and maybe make some adjustments as you're going. Yeah, and in the premium version of EveryDollar, there's an awesome paycheck planning feature which can show you visually when you'll run out of money based on when you have due dates for bills coming out. That's one of my favorites for people that are struggling with an issue like this. And there's a ton more advanced features we've been adding to make this way more than just our world-class budgeting app.

35:54The average person now finds thousands of dollars in margin in just the first 15 minutes with the new EveryDollar onboarding process. It's incredible. So start EveryDollar for free today. Get it in the App Store or Google Play. All right, Madison is in Sacramento, California, up next. What's going on, Madison? Hello. I'm honored to be able to get your advice. But, yes, I am 24 years old. My husband and I got married a year and a half ago, and we are on baby step number four. So we have worked to pay off my student loans and a car as well. Awesome. And we have about$20 ,000 saved and$25 ,000 invested.

36:35But I do have a dream to go back to school. But for me, it feels kind of like a step back in the debt savings plan. So I wanted to get your advice because we also want to buy a house. We're renting right now. So I wanted to get your advice on what you think the next steps would be and what you guys feel is a good idea when it comes to going back into debt for school, if I do have a stable career that I could grow in right now. Well, I would never go back into debt for school. I'm all for you considering furthering your education if you were paying cash for it. But you've come so, so far. Why would you consider debt again?

37:12What does it cost? So it would cost around$50 ,000. And I agree with you. I don't like the idea of going into debt for school, but for what I want to do, I would need a license. And so I would need to get my degree in that field. Right. But can we cash flow it? Can we cash flow it? Is this a two year deal? How many years of school is this? This would be more around three years. Three years. OK, so let's let's reverse engineer it and figure out, OK, what is it going to cost per semester? what will it take for us to make that happen? Because remember, there before you were taking all of your margin and throwing it at debt.

37:54What stops you from taking all of your margin and throwing it at tuition?

38:01Yeah, that's a good question. So I'm trying to figure that out. What do you make now? Together combined around$165 ,000 a year. That's an amazing income. Okay, and what do you personally make? I make$65 ,000. Okay. And you want to spend$50 ,000 on this program to get licensed to do what? To be a counselor. Okay. Are you in the field right now, but you're not a counselor because you need the master's? Correct. Okay. Have you looked at every single option at your disposal for what the most affordable route to go is? I have, yes. I've done a lot of research, but I also want to go to a school that has a certain accreditation so that I can be certified in multiple states.

38:50But I've also looked at working for a school where I could get it paid for, but I haven't gotten a job in that situation. That's a great idea. I just feel like there's cheaper alternatives that can get you to the stream faster and without debt. That's what I'm all about because the truth is never ask the counselor, hey, what school did you go to and what was the accreditation level? So I understand that you want certain licensing and all that, but I don't want you to over-index on the importance of the school that you go to. I want you to over-index on living a debt-free life so that you don't regret this later on.

39:23Because how much will you make as a counselor at that point? Will you go from$65 ,000 to$75 ,000? What's the upside here initially? So that depends. if I wanted to do a private practice which would take a little bit more time I could be making anywhere from$100 to$200 but I also in my career right now could probably grow into that as well but I also want to start a family so I don't know if it's worth it to go to school for that what happens if you go$50 ,000 into debt get pregnant, have the baby, buy a house and now you're like I want to stay home and now the math doesn't work you see what our fear is I'm looking at your whole life and not just this one piece.

40:03And so I would sit down and go, we can't do all this at once. We can't start the family, get the house, go to school. We got to figure out the priorities here. And if that's going to school, then we're going to put all the ammo towards that and cashflow it and get the job and increase the income. But if it's not going to increase the income initially, I don't know that it's worth it right now. I might wait to see, let's get the home. That's really the goal. Let's start a family. That's the goal. And when I'm 28, we can reassess and I can always go get that master's. yeah that's good advice but i think you've got the right heart for it i think you'd be a wonderful counselor just based on talking to you so oh thank you best of luck madison yeah this is so real sorry to cut madison but i just this is a real thing like this there's nothing childish or immature about this this is the stage of life where you could do a lot of things you want to do a lot of things and you can't do it all at once.

40:59Yeah. A few, yeah. A few people could do it all at once financially or even time, like bandwidth wise. It's a lot to buy a house and move in and have a baby and go back to school. Yeah. That's a lot. Got to pick. I would focus it. So if you've got the margin right now, you have a great income, 165 grand debt free. And they could cashflow it by the way. I mean, when you think about$8 ,000 per semester on their income, they can make that happen. I mean, they could probably right now throw five grand into a savings account after all expenses are paid and have 60 grand within 12 months. That's the math of it.

41:29So we're talking about, you know, even eight months from now, you could start the program and cashflow the rest of it. And so I would crunch the numbers in the budget and go, okay, this is what life would look like if we pursued this right now. Now we could put this toward a down payment instead. Here's what that would look like to get into a home sooner. But I think doing it all at once is where people get trapped because then you're stuck. You're stuck with the student loan payment. You're stuck with the mortgage payment. And now staying home, it's an emotional choice, but the financial piece just doesn't work.

41:56Well, the baby part in the mix is really the biggest unknown because nobody, no woman knows exactly how they're going to feel. Like you think, oh, I think I'm going to want to work. And then you end up not wanting to work. Or you think, oh, I want to be a stay-at-home mom. Then your stay-at-home mom, you're like, I got to get back to work. I need to be around grown adults and be able to use the bathroom. That would be nice. No, my wife, she dealt with that. She was here at Ramsey for nine years and she came back to work for months and it just, it weighed on her. She went, I got to, I got to be home, but we wanted to at least try.

42:26And financial peace gave us those options to go, Hey, we're debt free. You can do what you want. We don't have a mortgage payment. You want to stay home? Let's do it. So she's, she's thriving in the chaos right now. That puts this hour of the Ramsey show in the books.

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43:54Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. I'm George Campbell, joined by Ramsey personality Jade Warshaw, and we're taking your calls at 888-825-5225. Stephanie is in South Dakota up next. What's going on, Stephanie? Hi, thank you for taking my call. I've been married for about nine years And I've always had a job That I was able to adjust To my kids' schedule and my husband's schedule Recently I decided to go back To school to advance my career And my husband got injured So he hasn't been working for six months And I got a second job that more aligns With school and my new career So my husband's about to go back to work And he informed me that he's expecting Me to go back to my original Field and work around him, essentially.

44:42How do I have that conversation with him that I hope that his new job can kind of correspond with what I want to do in the future? Wow. That's interesting. Is his request income-based? Were you making more of the other job? No. He actually wants to quit his job and find a brand new field. For one, he says he's inspired by me. Okay. So you're both on your eat, pray, love journey here, trying to find your dream job, but we got to pay the bills as well. So where are we at financially? Financially, we are pretty much just keeping our head above water. I'm on baby step one. Sounds like not a great time to eat pray love.

45:22Would you agree with me? Yes. Okay. So how much debt do you guys have? I would say probably, well, I just started school, so I'm in my first semester. That one, with everything, I say about$25 ,000. All right. Is that total debt between the two of you? Yes. We're renters. We only have car payments and credit cards. Okay. And how much are you making currently? I think about 45. Is that with both jobs? Yes. Okay. And how much does the main job make? Close to 70. What happened to the 45? I'm confused now. I'm sorry. I make 45. He makes close to 70. Oh, he makes 70. From what he tells me. I thought he wasn't back at work yet.

46:09He just started getting workers' compensation, so it's kind of evening out. That's how I got to maybe step one. But what he wants to do is he wants to – he's on a manager level. He wants to step down from being a manager, which I don't know what exactly he wants to do, but it won't be nowhere near what he's making now. And that's his dream? I guess so. Or is the dream a different feel because the manager life stresses him out? So right now he's wanting to downshift, but long-term he wants something different. Yes. And he thinks that I need to support him and have an open schedule so he can find himself.

46:45But how can you? Because when George said, what does he want to do? You said, I don't even, I don't know what he wants to do. How can you support something if you don't know exactly what it is? So that's my thing. Yes. The closest thing I got was that he wants to go back to school and be a barber. Okay. Well, that's pretty clear. He wants to go back to school, be a barber. He wants to own his own shop? Yes. Okay. and has he put in any numbers or timeline or anything around that? Not really. It kind of scares me though because with my school, I know like the first five years is like you don't really see a profit.

47:20Well, you're probably renting a chair at first. You know, he's not just going to start a shop out of nowhere and be making bank. It's going to take time to build that up. And what's your dream? So right now you're in this career making 45. Is that the dream career that you're doing now? I'm staying in the healthcare field, but I'm making a little bit of a switch with the degree I'm going for in medical administration. I should be able to have more opportunities. What does that mean? Like right now I'm a CNA. So to move up, I will have to take some colonel license with the degree I can work as a scheduler.

47:52My dream is to be a nursing home administrator. Okay. Go ahead. Anywhere between that, I'll be making way more than I'm making as a CNA. How much is way more? Nursing home and training started at 90, I think about 90K. And what's the timeline on yours? About to get my degree three more years and then six months training and then I can go into the field. Okay, so your dream is a three-year and six-month journey. And how much does it cost?

48:26altogether i'm still after student loans i should have probably an extra 30 and um debt so you're saying you would have to go into debt to do this yes on top of your 25 you're saying you would add to the 25 in debt you'd add another 30 to finish the program yes does his require in his mind does his dream require debt he sees us no but uh barber school does cost uh i believe from my school 7 ,000 and up, depending where he goes. Okay. So his schools cost 7 ,000 and up. What is your school cost? Did you say 30 ,000? Yes. Okay. So here's what I'm thinking about. I'll be honest. I don't like the way he framed it.

49:05And I don't know if he's framed it like that or you framed it like that, but it kind of felt like his thing's more important than your thing. And yeah, that would rub me the wrong way too, if it really came out like that. But when I'm just sitting here looking at the numbers and the timeline and the risk on this, I'm going to tell you what I see and George hit me. I do feel like his is more risky because it is him building a business and going into hair industry. I feel like it's, it takes a lot of time to get that margin to start making money. However, so I'm going to say that his is more risky, but I'm going to say that his is cheaper and has a shorter timeline.

49:40And then for yours, I'm going to say it's more straight ahead. Like you get the certification, you get the job, you get the salary, right? It's pretty straight ahead. So on the actual landing of the job, there's less risk, but the problem is yours is very expensive and you can't go into debt for this and it's a longer timeline. So you guys have to decide, is it even possible in the state that you're in to be able to cashflow what you're trying to do? Because if you can, I might go your route. Well, as of right now um they put my student loans i don't have to pay into after i graduate however i'm still making payments on it so and i'm also doing three-fourths of a full-time so i'm i'm not i'm not hitting that they have uh it's a junior college so i'm not hitting that top tuition i'm trying to save money while i'm doing it but you still can't go into debt at your old job the job that he wants you to go back to what were you making on that job uh that one by itself about 30k i thought it was i thought that was the better job uh that one was better because just for time that's that yes the flexibility ah okay well here's the thing a starting barber probably gonna make 15 to 20 bucks an hour he's probably gonna make 35k a year instead of 70 and so this dream needs to make sense and for that to make sense you guys need to be in a much better place financially So leaving this whole situation with$55 ,000 in debt and cutting your income in half while you still have years of schooling to go before your income goes up is a recipe for disaster.

51:16Do you agree? Yes. So we need to just delay the dream right now, clean up our financial mess, and try to avoid going into further debt. So if you can cash flow your whole schooling and pay off your debt, then we can focus on his dream. And we can cash flow$7 ,000 easily,$10 ,000, and get done with barber school. and then he can take a pay cut for a temporary time and you'll be okay because you're making 90 grand with no debt he has the freedom right okay but please the number one takeaway you cannot go into debt for this degree if you go into debt for this degree it is going to put such a strain on all of this and not you going like especially you going you're going first and adding that that's going to make it even harder for him to get to his dream.

52:02So please, do. You'll be dragging each other down if you do it this way. And that's our fear. We want to see you guys work jobs you enjoy. So much so, we're going to gift you Ken Coleman's Get Clear Assessment. I think both of you should take it and make sure that whatever field you end up in, there's no regrets. So hang on the line, Stephanie. We're going to make sure you get those resources from our friend Ken Coleman.

52:43This show is sponsored by BetterHelp. All right, this time of year can be tough, so I want you to make sure you check on your friends and your loved ones and even reconnect with people you haven't talked to in a while. I recently called one of my childhood friends, and we had an amazing catch-up conversation. We laughed hard and we talked about the struggles we've been having. It was fantastic. And just like it can take a little courage to send that message or grab coffee with someone you haven't seen in a while, reaching out for therapy can also feel hard, but it can be worth it. If you're thinking about therapy, I recommend BetterHelp.

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54:03Patricia is in Atlanta up next. Patricia, welcome to the show. Thank you for having me. Absolutely. What's going on? Well, I am an 82-year-old widow, and my husband was a mattress saver. Oh, wow. He saved money under the mattress. Okay. And I've got this hunk of money, and I don't think there's anything I can do with it. I'm afraid to try to do something with it. How much? It's over$100 ,000. Wow. How long was he saving that for? 25 years. Okay. Is that your only money, or is there other money? Is there any money in the bank? i have about 400 in cds and i i bought my house cash and it's about 425 now on a paid off car okay i got 1400 in social security which is income you know and is that all you're living on i'm sorry the 1400 do you live solely on the 1400 social security I do my best.

55:19Wow. That feels tight. What are your expenses every month? Oh, just the regular utilities and homeowner's insurance, car insurance, that type of thing. You know, just the regular day-to-day expenses that a person has. I don't eat much. Now, can I just clarify, when you said 400 in CDs,$400. Not$400 ,000? No,$400 ,000. Oh, wow. $400 ,000. Okay,$400 ,000. Is that essentially your nest egg just in case, breaking case of emergency? What are you using that for? I'm just afraid to spend it, that I'll run out of money before I'm not here any longer. So you want to deposit the$100 ,000 in cash. What's the question?

56:10The question is, I've asked other people, and they say, if you try to just take this big chunk of money and put it in the bank or buy something with it, the internal revenue is going to come and say, where in the world did you get this$100 ,000 in cash? I mean, I don't think they're going to take you into a room and interrogate you. The bank legally just has to file a report. Anything over$10 ,000, they just have to file a report saying that you deposited the money. They might ask you, you know, the source of the funds. You can say my husband, you know, saved cash in a safe for years. It's not illegal.

56:46I care more about the$400K in CDs than I do about the$100K in cash. I'd love to see you invest that$400K. That way if you want to draw a little off of it, you can, and you don't have to worry about it depleting. Well, the only thing with that is I don't know anything about stocks or anything or money market accounts or, you know, all those other stuff. What if you had someone who you could interview and then help you with that? Well, I probably would listen to them and see what they had to say for sure. Yeah, I think having a SmartVestor Pro would be good for you. And these are people that we vet and we make sure that, you know, they're good and that they can teach you and help you to feel good and understand, hey, this is what it is and you feel good about the investment.

57:36It's not them just taking the wheel and doing everything for you, but it's you making sure you have skin in the game, understanding it, approving what's taking place. And that way, yeah, I mean, living on$1 ,400 is slim pickings. So that way you can get a little money. You can live off more and they can run the numbers for you and show you, hey, this is a conservative take on what you could withdraw from this without it depleting in the next five or ten years. And so they can show you all the math. They're not going to put you in some risky single stock or crypto or something that you're not comfortable with.

58:05You stay in the driver's seat, but they're just educating you on what your options are, and then you make the choice. So that's what I would do. I would go deposit the 100 cash today, and I would make sure you have most of that money invested so that it can grow for you. Because that 100K, as you know, has been eaten away by inflation. What you could buy with 100K back in the day versus today, it's different. And so you need that money at least growing at the speed of inflation, ideally more, to beat it. And so that's what we're advocating for. okay that sounds interesting head down to the bank with your with your winnings i think they'll have a good laugh if you say well my husband was a mattress saver they go yep we've seen one of these today you know can you imagine that's right stuff in a suitcase with a hundred thousand and just heading down to the bank you just stuff your duffel bag and just head on down i gotta know what you know was this mattress lopsided with all this cash underneath I'm hoping it was in a safe or something.

59:04That's ideal. Even still, the fact that you got to get into your car and drive with$100 ,000 on your person is different. I might have an armored vehicle for that. I would get a pit bull to walk everywhere with me just to be sure. Good luck, Patricia. Be safe out there. Brittany is in Idaho up next. What's going on, Brittany? Hey, thank you for taking my call. I'm trying to figure out what to do with my car. I owe about$12 ,600 on it. It's valued at$5 ,000 to$6 ,000, according to Kelly Blue Book. It needs some repairs currently, about$2 ,500. And at this point, should I voluntarily surrender the car back to the lender or keep pushing through and pay it off and get it fixed?

59:51What do you make? I make about$4 ,200 a year. 42 ,000 you mean 42 ,000 okay you scared me I was like uh goodness gracious Brittany what's going on in your life you're making two dollars an hour out there okay yeah all right so this car you're underwater on it severely you don't have the money to do the repairs and I I've never suggested a voluntary repo because here's the problem they're going to sell it at auction and still come after you for the difference. So you're better off selling the car for what you can get for it and getting a personal loan from your credit union because it's not going to really release you from your situation here.

1:00:37Okay. So how much money do you have right now? Saved? I have about$3 ,500. I'm on baby step number two and the car is my last debt. Okay. So you have the money to do the repair, but it feels like, is this worth it? Is that your issue here? Yes. Well, there's two options. One is you do the repair, you eat the cost, and hopefully the car runs for the foreseeable future and you pay it off. That would be nice, right? That would solve the problem. How quickly could you pay off the remainder 12 grand if you did the repair and then started knocking out the 12 grand? I am permanently disabled, so I'm limited with my funds.

1:01:24Paying my monthly car payment is the only amount I can pay. So you can only make the payment and nothing more. You can't put extra on it, which means this is going to keep dragging out. You're going to continually be more and more underwater as the loan probably balloons. Correct. Tell us about the car. Is it prone to issues? Has it just been having issue after issue or is just this just popped up and you're like, dang it? no this is the first issue i had since i've owned it it's a timing belt that's going out i i've been told if i keep driving it if it breaks it'll affect the engine but i've been advised not to drive it even though i still drive it a little bit every now and then i don't drive a lot so it's been working for me but i'm worried that if i keep risking it i could push my legs Yeah.

1:02:20Have you gotten other repair quotes from other mechanics? I have. The$2 ,500 is the cheapest I've found. I've went to three different places. Now, if you did the$2 ,500 in repairs, could you sell it for more?

1:02:36With the repair with a fixed, it's going to be about$5 ,000 to$6 ,000. Okay. And so let's pretend let's so if you if you took twenty five hundred out of your saved money, paid this off at what rate or I'm sorry, took that money and repaired the car, the car is driving. At what rate would it take you with the income you have nothing extra to pay off the I mean, what's remaining on the loan as far as time?

1:03:07That's a good question. I'm not quite sure. I know I owe$12 ,600 left, and I pay about$400 a month. Have you tried going to your local credit union and seeing if they would give you a loan for the difference to at least get out from under this? I haven't. I don't have the best of credit. I had a lot of medical issues when I became permanently disabled and it messed up my credit. That's one angle you can try and then use your savings to get you a beater car to get by for now, but there's still bigger problems to solve here. And that's going to take getting the income up and getting rid of this debt.

1:03:43It's going to be a journey.

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1:05:21All right, George, I'm hearing something very crazy about your social media. Tell me more. I happened to pop on there and I saw you had a video with 14 million views. Yeah, it got out of control. That's wild. So we did a man on the street. I love getting in the streets, getting in people's business, asking them questions about finances. And we happened to be in Orlando recently and I said, let's go to Disney. So we went to Disney Springs and we asked people how much debt they had. and our team just clipped that on social media and it blew up with a lot of feelings. I'm sure. And so I wanted to get your feelings about it and react to it in real time if you're willing.

1:06:00Because there's some trigger words in here that I think you'll have some thoughts on. I'll be honest. Is it weird to you that I saw like the little icon on social and I saw the views, but I didn't actually watch the video? It's hurtful, but understandable. You're a busy woman. You don't have time to watch all my content. Okay, I'll watch it. I'll watch it. Okay, let's watch it along with America. See what they have to say. Are you guys in any kind of debt right now? Mine's pretty minimal. I think a credit card and a vehicle, probably about 60. And that's minimal to you? No, it's a lot. What's left on the car loan?

1:06:3153. What are you driving? A 24 Toyota Tundra. How about you? How much debt do you have? Probably 75 ,000. Credit cards and then a car loan as well. What's your car loan? Student loans, yeah. Like 60. 60? What are you driving? I was terrible. You rolled over negative equity, didn't you? Yes, I did. Yes. Yes. Honda Pilot,$25 ,000. What's your car payment? $1 ,200. How much your car payment? $9.82. I mean, you're just giving away the income every month at this point, right? Yeah. How much student loans we have left? I probably have$100 ,000 in student loans. Okay, add it all up in your head. I think we're doing this for the first time.

1:07:07How much debt do you have total, total, total? I'm going to say at least$180 ,000. Can you tell me, did you guys pay cash for the trip? For half of it. The other half is on what? A Disney card. It's the Disney credit card. What do you get for putting it on the Disney card versus any old other card? It has six months special financing, so there's no interest for like six months. Okay, so is your plan to pay it off in six months? That is the plan, yes. That is the plan, if we can do that, for sure, yeah. That doesn't instill confidence. You're like, if we, I, because otherwise it's going to like crank up to what, 29 % APR or something crazy?

1:07:40Right, yeah, absolutely. Do you guys have any debt right now? Yes. How much? My student loans, they're about$100 ,000. What was your degree? Business, administration. How much total do you have in debt? Probably around$128 ,000, I'd say total. Do you ever feel like I'll just die with the debt? Is there a game plan to be like, I'm going to pay this off in three years? Or it's just kind of like, I'll make my payments. It's going to be probably in about 15 years, I'm assuming. I'll get it paid off. I don't know. How old are you now? I'm 22. Man. Oh, man. Oh, man. Okay, so much to unpack. And that was just a minute 49.

1:08:13The video is 15 minutes. If you want to watch the whole thing on my YouTube channel, George Camel, we'll put a link in the show notes. More juicy stuff where that came from, including a guy who was, let's say, under the influence when he took out a car loan. Wow. Oh, wow. You would. Wow. Yeah. The interest wasn't the only thing that was sky high that day. Listen, I'd rather be able to blame it on that than me being in my right mind going into$60 ,000 of debt and a$1 ,200 payment on a Honda Pilot, George, of all things. so there's a few things I want to point out that were said so number one uh the justification language well it's minimal well it's zero percent well we were for it we had to right there's all the justification language that we hear on the show I hear it in the streets and I don't know if it's people you know there's some shame and guilt around it understandably so you make yourself feel better by saying well it's only 20 grand right right you know those words bother me because I want them to feel the weight of it.

1:09:09And I think you're deflecting when you say, well, it's minimal. It's only it's zero percent. Well, you make it seem like your back was against the wall and you had no other choice. And I'm like, here's my thing. If you were going to go into debt, did it have to be 60 ,000? There's plenty of great 30 ,000 dollar cars out there. I'm just saying that is true. And then the other part that shocked me was I'm like, I'm the first guy making you do the math on what you actually owe. So I ruined a lot of Disney dreams that day. Yeah. The comment section. I didn't realize this, but they're like, these people are out here trying to have a good time and George is ruining their day.

1:09:41The guy in the poncho, when you told him that his interest was going to crank up to 26 percent, did you see his eyes? Like the look in his eyes. There was a sadness. I don't know if it's because just a grown man in a poncho at Disney is just a sad sight anyways. Yeah. But the fact that he was like, yeah, I mean, I hope we can pay it out. Like he did a thousand yard stare. Yeah. Into another life he's dreaming of. You brought him into, you know. Hello, darkness, my old friend. it was a lot going on there and it was also frightening to see how much crippling debt people are in and they're just adding to the pile with a little disney trip and i asked people how much their disney trip cost jade i did not know all right call me ignorant i didn't know it was a lot it's a thousand dollars a day per person to breathe yes in disney yes and this is not a knock against disney it's a wonderful experience magical i love disney but the idea that you're going to go another six grand into debt or put it on the Disney credit card because they've convinced you this is the smart way to pay, it boggles my mind because they're going to add that to the payment when they get home on top of their$1 ,200 car payment.

1:10:44They got a Disney credit card payment to make. How can you even enjoy it in the moment knowing that? I'm like, I can't be the one ruining your enjoyment. Your decisions have already ruined the enjoyment. It's like eating a meal knowing you're going to get food poisoning. Oh, that's a great analogy. How can you enjoy it? knowing what what is the future holds there's gonna be held to pay on the other side of this but i'm gonna enjoy this queso right now oh lord why'd it have to be queso sorry i don't want to throw queso under the bus goodness gracious so i encourage everybody to uh to watch that video and if nothing else i know why people watch to make themselves feel better about their financial situation yes that's like you know entry tier ramsay that's why you watch the show yeah you Second, I hope you go, you know what?

1:11:29This makes me want to fix my situation. I hope so. And then third, you actually do this stuff and you want to send it to people to see this is why the Ramsey plan is so important. You know? Wow. Well done, George. This is why I go into the streets. You know, in the rain with the umbrella. I really sacrificed for the content that day. But it paid off. So thank you to everyone who's watched it, shared it. And just know my heart is not to shame people. my heart is to bring some awareness some you know some people are problem unaware they don't know how bad their debt is they don't know it's a problem they just think it's normal to have payments so the more we can shed a light on debt and say this is not normal and if it is normal we need to run the other direction that is the hope that we we have for making content like this good job george i think you did just that okay let's go to isaiah in detroit up next what's going on, Isaiah?

1:12:24How's it going? I was just here. Let me tell you guys a little bit about my situation. So I'm 18 years old. I just graduated last year. And during the school year, I started a mobile car detailing business. I've been in about eight months. And so far, I've been doing it part-time, like with school and work. And I made about$3 ,000 from the business. And now that I've graduated high school and entered college, I realized that I want to learn more about business through actually doing it. So I decided that I wanted to move to South Carolina with a family member who runs a different business that doesn't really have to do with car detailing, but they are the closest mentor I would have.

1:13:05And I wanted to go down there and move in with them. And they said I could stay there for a few months while I get up and running in the area. I currently have about$25 ,000 saved and my budget for the move is$8 ,000 to get a car and the equipment and everything I need. My family thinks that it's super risky. Why? I've completely lost my mind. So you're doing this with cash. You have no debt. There's an established business that's going to pay you when you arrive? And so I would have to, I'm set. There's no job, right? They're not paying you to work in their business. They'll just mentor you, but you can get a job.

1:13:45Yeah. And you're willing to get any old job while trying to get your own business off the ground? yeah 100 i actually really like this i think that school will be there it's not going anywhere where college like what were you going to college for anyway i was going to college for business management yeah i mean that degree is going to be there i love on the job training like i love the idea that somebody would mentor you who's starting a business are they successful this person or is this their first go round two yeah they are they are pretty successful they rent out beach supplies. And they've been doing that for a good couple of years and have made a lot of money.

1:14:26Yeah, I like the idea. Man, 18 single. I think this is one of the least risky things you could do. And I would advise you to do it because worst case, you come back home. The key is don't go into debt for anything, not for equipment, not for a degree. Cash flow every next move and then follow that path that it takes you as you cash flow this amazing business. I think it's a great business idea. Car detailing, big money to be made, especially if you can serve people well and you don't need a business degree to do it.

1:15:23You don't have to wait for Black Friday to get Black Friday deals. The sale is on now, and that includes$12 best-selling hardcovers, $12 questions for humans decks,$6.99 audiobooks and e-books, $15 assessments, and so much more. Go to ramsaysolutions.com slash store, or if you're watching on YouTube or podcasts, click the link in the description. Jessica is in San Antonio up next. What's going on, Jessica? Hi, thank you for taking my call. Sure. So my significant other and I are planning to get married, and he currently pays child support and alimony from his previous marriage. I know once we're married, the money and debt becomes ours, but I'm not sure how to handle those payments, like specifically the alimony.

1:16:06So my question is, should that come out of our joint budget? Should that stay his individual responsibility? Yeah. What's the parameter? How much and for how long? uh 300 000 until paid off wow that's a lot of money um there's part of this where you know i'm always going to be for combining finances and taking on whatever the other person has in the form of debt and everything else and in many ways this kind of is that right because you're getting into this uh situation together i'm thinking through this and yeah i think i would it would be ours the child's work otherwise i feel like there would be separation there here's how i'm viewing it and you can tell me what you think jessica i'm almost viewing it as a deduction before his take-home pay so like you pay for health care out of your paycheck your 401k so if you just sort of took that out and then had his new take-home pay, which is the lower amount post-alimony, that becomes our money.

1:17:14I think that helps me frame it up differently. Mentally. I like that. To where it is coming from his income, but there's still this pool that's our money, but we're just not going to see that money because it's not your money. It has an allocation legally of where it needs to go right now. And it's not forever. And so this will change and it'll feel like you get a raise, I guess, when that day comes, when that 300 grand is paid off. But either way, it's going to affect your world because it's$300 ,000. That would have been part of you all's budget. That's not part of you all's budget. Is it a set monthly amount?

1:17:44No, not set. Is it variable because his income is variable or how does that, what's the agreement there? Yeah, variable income, quarterly bonuses. Yes, so he just pays it when he can. And I know we recently moved in together and I do allot him a specific amount to help cover the mortgage, even though we're not married. And I know he did raise his alimony at the same time. So I know he's trying to get that paid off as soon as he can. So when will you guys be married? No set date yet because I am trying to logistically figure this out. Okay. Okay. So this is kind of what's holding you back then?

1:18:27Well, yes. I could see that. I could see that. Yeah. What will you guys be making once you're married? And then what will your debt load be outside of this alimony? So I don't know his exact take home. I know what he brings in after taxes and stuff. But I would probably say, oh gosh, almost$400,$350 to$400, I believe. That's awesome. A year. And any debt to speak of? outside of the mortgage and the alimony? So his mortgage, full loan, car loan. And then unfortunately, I've been through the baby steps, but I had to buy a car. So just a small amount for me, but I'm actively going back around. So his mortgage is the plan that, what's the plan with the mortgage?

1:19:17Will you guys move into that house? Will he sell it and you guys move somewhere else? Because I'm almost wondering if he can take when that day comes if he can sell off an asset in order to get this done. Yes, I know he mentions that. That is his plan. I currently did move in with him, and our plan is to sell the house he's currently in that we live in, finish paying what he owes to her, and then us purchase a new home together. Well, that feels like a solution there. Yeah, I was kind of looking at it like if this was just a giant consumer debt, we'd go, all right, we'll just tackle it with whatever your income is because the sooner that's gone, the sooner you free up that money.

1:19:57So I think that's a good plan. And I think it will unify you guys as a couple as well to just go, all right, this isn't how we either of us pictured it, but we have a 300 ,000 debt we need to pay off on top of our car loan and credit cards. And I hope it gives you some onus to get rid of your own debts faster. Because the sooner you're on the other side of all of this, the more wealth you're going to build together and the more options you're going to have. Yes. Okay. Yeah, that makes sense. Thank you. Yeah, absolutely. That's a tough question. It is. It's a lot intertwined in there. I kind of feel like they did complicate it a little bit by her already moving into there.

1:20:33Paying towards the mortgage, which is more complication. So I don't love that part. It's only going to add insult to injury. Because she could have sat back in her own apartment and said, hey, you've got this$300 ,000 debt. Why don't you sell off something and clean it up? But now since they're both in that house, yeah, anyway. Thanks for the question. Mary-Kate is in Phoenix up next. What's going on, Mary-Kate? Hey, how's it going, guys? Thanks for taking my call. Absolutely. What's your question? So this is an interesting one. I just started listening to the show a couple weeks ago, so I literally just started going through my debt, starting to pay off my debt.

1:21:12I paid off my car, which was the first kind of lowest debt that I had. I had gotten to a car accident last night and totaled my car. Oh, my goodness. So, yeah, that was a bit of a surprise. Oh, totally fine. Yeah, thankfully wasn't the at-fault driver, but, you know, bummed that I just paid off my car and then I just got totaled. So curious to hear what you guys think about this. I kind of know where I'm guessing I know where you're going to lean, but don't have the money to pay for a car out, you know, outright right now. So I was potentially thinking of taking on debt to buy a car and then wait for the payoff for my insurance company, which is probably going to be between$30 ,000 to$40 ,000, and then just chuck that at the debt.

1:21:56Make sure I don't finance a car for more than that amount. Well, how long until they write you a$35 ,000 check? Yeah, that's what I don't know. And will they provide a rental car in the meantime? That's my question. Yeah, I think they will. I can also pay for that out of pocket and then get reimbursed for that. It's probably going to take about a week until I could get a rental car, but I kind of need one right now. Why would it take a week to get the rental car? From what I understand, I've never been in an accident before, so this is all very new to me, but from what I understand, the insurance company needs to wait for liability to be confirmed from the police report and things of that nature.

1:22:38Well, could you rent one on your own dollar for that week or whatever and then switch to theirs? That's probably what I would do. I would not go into debt on a car and, you know, be at the mercy of the insurance on a car payment that's got interest that's accruing and everything like that. Sure. Okay. So you've already filed the claim that night? Yep. Okay. Has the adjuster inspected? Yes, I did last night. They're inspecting it today or tomorrow. So they towed it to like the car body shop and they should be expecting it today or tomorrow. Okay. Because I'm thinking most people will get that insurance check in about seven days.

1:23:18So I don't think it's going to be a super long time. I would just get whatever rental you can right now. And I would also check with them before you do any of this. Say, hey, I need a car right now. What are my best options? And make sure that you know exactly what their amount is. They'll reimburse, how soon, all of that. Get all the facts. but I would not go jump into, you know, go to the dealership and say, hey, I need a brand new car. That's what most people do when they total their car. They go, woohoo, I won the lottery. Time to go get a$50 ,000 car loan. They spend more than the payout.

1:23:46And they say, well, I had to. I had to get a new car. Totaled mine. What are you going to do? And that's how we have, you know, a middle class America that's broke. So I hope that's not you. You've done so well that I'm like, why go backwards into debt even for a moment when you can avoid all of it? Okay. Okay, so wait to have that payout in hand before I do anything, basically. Yes. And, you know, get yourself as nice of a rental you can with the reimbursement they'll give you. I'm sorry that happened. Thank you. And quick question on the payout. That's not like a taxable event or anything as long as I use it for the purchase of a new vehicle.

1:24:23Is that right? Yes, because you weren't, like, making money here. This was not a money-making scheme where you sold the car for more than it's worth. You know, insurance is valuing that car at what it was valued when you wrecked it. So nothing to worry about there. So if I get a$40 ,000 payout and I go buy a car for$20 ,000. You can do that. And if you have debt, I love that plan for you. Because if you had sold that car for$40 ,000 and used$20 ,000 of it to buy a car, that's your American right. And I would honestly do that if I were you. If you've got other financial goals, other debts to pay off, it's only going to make your life simpler.

1:24:56and a 20 ,000 car will get you real far these days.

1:25:25Welcome back to the Ramsey Show in the Fairwinds Credit Union studio. I'm George Campbell, joined by bestselling author Jade Warshaw. Open phones at 888-825-5225. Claude is in Orlando, Florida up next. What's going on, Claude? Hey, how y 'all doing? Great. How can we help today? Okay, just long story short, I haven't paid my RS in several years. Basically, I got out of high school, 07, 08, kind of fell into a good job working for foreclosure companies and started buying up foreclosures and kind of amassed about 26, 7 doors rental. But it's all paid for. But I'm at the point I just bought a house through private financing.

1:26:17But I would like to hear permanent financing. but I haven't done my federal taxes in several years. And they're going to want to see tax returns for you to get that financing? Yes, sir. And this is the only reason you've decided, I guess you should probably deal with that. Why haven't you filed? I'm just kind of ignorant, I guess. No, you're not. Ignorant people don't own 27 rentals. Thank you. You're very successful. So what has caused you to just ignore the taxes completely? Because you filed taxes up until what year? I think the last time was 16. I did it. Okay, so we're coming up on 10 years.

1:26:57And nobody's knocked down your door yet. You haven't got anything in the mail? No, sir. I don't really, on paper, I guess, show making a bunch. Most of that income's in cash. And you've spent it? Do you have the money to pay all these back taxes, penalties, fees? I don't have any idea what it would be. Well, how much have you made in the last 10 years? I mean, anywhere from$10 ,000 a month to$15 ,000 a month, just depending on me. I got a lot of irons in the fire. So you're talking about making$150 ,000 to$200 ,000 every year for the last decade? Yeah. I mean, it's slowly escalated year to year.

1:27:40All right. I'm going to call it half a million, just ballpark numbers. How would you come up with half a million dollars to pay the IRS? That's a good question. I mean, I figured up the other day before I came on here, I got about conservatively$4 million in real estate. So it sounds like if I were in your shoes, here's what I would do personally. Number one, I would get with an enrolled agent or CPA yesterday and start tracking down exactly what I need to do to get current, get on a payment plan, and get this mess cleaned up. And then whatever that bill total is, if it's$500 ,000, I'm not even going to get on a payment plan.

1:28:20I'm going to liquidate enough properties that I knock this out. I mean, should I be even reporting the cash? You should report every dime you make. Give to Caesars what is Caesars. So I know you want to avoid that. I don't know if you're going to take my advice, but I don't want the next phone call from Claude to be from a jail cell. Yeah. That'd be ugly. Yeah. You got to do this with integrity, my guy. The last people you want on your back is the IRS. They can destroy your life. I know. That's right. And so I would not ignore this any longer. It's been almost a decade.

1:28:57What are you going to do next? I guess I need to go to a CPA. That's right. And you're going to need to get with the IRS and figure out exactly what you owe. And they can help with that. But do not avoid – I know you deal with a lot of cash. I would get things on the books. I would have everything, every I dotted, every T crossed. Okay. And that might mean you need to hire someone to do the books. If you don't like doing it, you don't want to do it, I would hire someone who can do it. The good news is you have the assets to clean this up very quickly. Yeah. How much debt do you have otherwise?

1:29:35I mean, I borrowed$165 ,000 on that house from that private investor, but I mean, I've been offered$275 ,000 for it like it is. But besides that, I don't owe a dime. All the 26 properties are free and clear. Yeah. So could you sell one or two of those to knock out this IRS debt, worst case? I mean, I've been letting a few go, but the property taxes and other unforeseen things are beating me up. It just doesn't make sense. Why are you so tight on cash? I mean, just... If you're all paid for, they should be cash flowing beautifully. Are you just spending every single dime you get? No, not – well, okay, so I bought all these houses kind of cheap several years ago over the last several years, and then I was just shoving people in them, doing the minimum.

1:30:28And so now I'm kind of paying the popper on that. So when they're coming open, I'm spending a fair amount of money. On repairs and maintenance and all that because you neglected to do it. That's right. Man, that's part of the business. You know what? If this is too much for you to handle, I would liquidate a bunch of properties and just keep what you can actually manage and manage well. Well, I mean, it's my main income. Yeah, but if you liquidated the properties, you'd have something called money. And right now, it sounds like you're tight on cash flow for some reason because you're just bleeding out.

1:31:00With 27 properties to manage, it's more expensive. Yeah, I mean, if I got a few thousand bucks left over at the end of the month, I'm doing good. I mean, I'm not— I'm just confused. For a guy who doesn't pay taxes and makes$15 ,000 a month, you shouldn't be this broke. Well, I'm at about$10 ,000 right now. I mean, if I got everything full, I'm at$15 ,000. Out of 27 properties, you're only making$10 ,000 a month? Yeah, what kind of properties are these? Well, it's definitely low-income stuff. I mean, I bought some of these things in 2009 is about when I started buying them. I bought these things for$5 ,000.

1:31:38So you're making like a few hundred bucks off each one.

1:31:44A few hundred. I mean, the bottom of the rent in my area is like 600 bucks. 600 to... Okay, I'm just saying you have 27 properties and you make 10 grand off of those. That's 370 each on average. Yeah, and I've got like five empty right now. You've got some vacancies too. What would it look like if you sold a couple of these low-income properties and got some nicer properties where you can garner a higher rent and still pay for them fully in cash? And then instead of having 26, maybe you have 10, right? Or maybe you have eight. They're higher quality. Higher quality tenants pay more. That's kind of what I've been doing.

1:32:23I just sold one last week for$55 ,000 that I bought for 10. But I paid$40 ,000 in property taxes last week. What about the capital gains on those? That's what I'm, I don't know. Oh my goodness. So on top of your income, you could have a huge capital gains bill from all these investment properties that appreciated since 2009 when you bought them for, you know, pennies on the dollar. But I've never depreciated any of them either. Wow. I think you need help. I think you need somebody to help you with the financial, like the books on this and help you to understand what it is that you're doing. yeah well i also had a secretary that uh was embezzling money too oh no goodness gracious wow i think i think the word for you in the new year if because i'm already talking about the new year is simplification yes you need to simplify your life you got a lot going on yeah but right now you've just been ignoring it and it's just compounded and compounded and so now it feels so overwhelming.

1:33:26So I would jump on a Ramsey solutions.com, get in touch with a tax pro today, and they're going to have their hands full with you. You might be their full-time client for the next few months as they uncover and turn over every stone that you have left to rot. So goodness gracious, Claude, I'm sorry you're dealing with this, but man, neglecting the problem is not going to make it go away, especially when it's the IRS. Good luck.

1:33:55Thank you.

1:34:25using Ramsey Trusted Pros. Whether you're looking for car, home, or any other type of insurance, Ramsey Trusted Providers have been coached and vetted to serve you like we would. Find what you need at RamseySolutions.com slash insurance.

1:34:58It's that time of year. In a few weeks, we're going to be doing a special giving edition of The Ramsey Show, and we want to hear stories from you about how you have given generously this season. Maybe you've tipped a waiter or a waitress$100 or bought Thanksgiving dinner for a family who couldn't afford one. Maybe you've blessed someone in need by giving them a car, doing something outrageous. Maybe you've been on the receiving end, and you had your life changed or affected by someone who gave generously to you. We want to hear those stories. Dave Ramsey and I will be doing that giving show, and it's going to be a lot of fun.

1:35:28So go to RamseySolutions.com slash ask, A-S-K, and put giving in the subject line. We do this every year at Christmastime. It's one of our most popular shows, very heartwarming, coming up December 18th. So start sending in your stories of giving today, and let's celebrate living like no one else so you can give like no one else. Sydney is in Columbus, Ohio, up next. What's happening, Sydney? Hi, guys. My husband and I are trying to figure out how to financially approach our home. We were given lead orders by our state health department. We're mandated to hire a lead abatement specialist to do some actually relatively minor work around our home.

1:36:17And the bill is going to be about$30 ,000. Oof. Wow. Yeah. We have five young kids, seven and under. We definitely don't have$30 ,000 laying around. And the state's giving us a year to come up with the money, get it done, or whenever they deem necessary, they can force us to leave our home that we own. so we we could get a home equity loan that's a kind of hefty payment but I'm not sure we really have any other options what do you guys earn my husband pre-tax was 58 ,000 last year and are you working outside the home No, I stay at home with the kids. How many kids and how old are they? We have five kids, seven, five, three, two, and six months old.

1:37:24Oh, my goodness. Now, are you needing to do a full abatement? Have you checked on that? I mean, we have the orders that the state gave us. There's, you know, a whole list of things that, you know, they give you what you need to fix. and the control options to fix it, that sort of thing. Okay. And have you got multiple quotes? Yes, they're all between$29 ,000 and$33 ,000. So I kind of run this backwards. I mean, if you said$30 ,000, that's right in the middle of the road. So I'm thinking, okay, I have a year to do that. I have 12 months to do this. That's about$2 ,500 a month. What can we do to bring that money in so that we can have this process started in time?

1:38:07so as it as it sits after you guys is built after your bills are paid how much margin do you have to go towards your debt or whatever whatever your financial goals are right now uh maybe a couple hundred dollars a month like a couple hundred like two or a couple hundred like five uh maybe two okay it's not a whole lot what does your husband do for work uh he's a mechanic for a neighboring county for the highway engineering department. And if you, what's your house worth if you were to sell it? We have up to, well, close to$200 ,000 in equity. And that's with the mold? Getting someone to buy it.

1:38:51Yeah. Is that with the lead? What is, what would it be worth with this lead issue going on? I mean, it's actually about$30 ,000 less. Okay. But But the problem is getting someone that would be willing to buy it because the lead orders aren't with our name. They're with the address. So whoever would buy it would have to be in the same position that we are. Right. But you would hire a contractor and do the work. Right. But that would be an incentive that you would have in the sale. Like that would come from you. That's what I would think. You'd lower the cost by that amount knowing they're going to have to deal with it.

1:39:28Uh-huh. That's why we said less$30 ,000 in the equity. Well, we did talk to a realtor.

1:39:37And when we bought the house in 2021, we got a 4 % interest rate. And given the equity that we have, it's not likely that we're going to find anything even remotely affordable with how interest rates are now. Understood. But there's also, you would have, here's, I want to reset where we're at. the problem is you need$30 ,000 and there's going to be limited options to get it. And I'm taking debt off the table. Since you called in, I have to take debt off the table. I don't want you to go into debt. I don't want to make this worse on you. So that means that we have to consider the options. And I'm not saying that that's the option you have to choose, but the options we have in front of us right now are what can we do that's going to find us 23 extra dollars per month?

1:40:25Is it something that you pick up in the night? Is it something that your husband does on the side? Is there overtime? That's one option. Another option is, okay, we could sell this house and then take the money, park it in a high yield, maybe rent for a while or move into something smaller while we save up to buy something again. this is a bad break no matter how you slice it that i mean i have to say that this is emotional we're talking about your home we're talking about your family there's no side of this that is good or convenient or like it all sucks right so i'm just trying to give you options that won't put you later in a suckier position because that's what'll happen if we add debt to this when was the house built?

1:41:161895. You're serious? Yes. Oh my goodness. It's an old farmhouse. Okay, I just did it on a quick search. Have you heard of the Ohio Let Abatement Tax Credit Program? Yeah, our county didn't apply. That's a large part of our frustration is that all the grants that are available for let abatement are county by county. and our county just actually today confirmed um they didn't apply because they didn't think it was worth it and now we're just out of luck and now it's too late wow yeah and they won't apply later either we've we've gone that route too we've contacted lawyers we've contacted realtors we've contacted state health department local health department county commissioner's office Wow.

1:42:03Senator's office, state rep's office. So you've done your homework on that end. Trying to get some form of assistance. Yeah. Is there a world where... The counties around us want to help us, but they're not allowed to give us any grant dollars. Yeah. Is there a world where you could work at night or your husband could take on a side job or do some extra mechanic work on the side to come up with this money? I mean, that's pretty hit or miss. My husband's on call 24-7 for the county. so he has to if he got a second job it would have to be under the understanding that he has to leave when the county calls him so it's kind of tough and we live pretty rurally as well and what do you guys have in checking and savings right now?

1:42:49We have a little less than$300 or$3 ,000 in savings that was supposed to insulate our basement for the winter because it's pretty cold and is it safe to live in this house let's say you do stay for the year while you come up with the money it's safe to live there yes is there any way that you can file for some sort of extension or anything like that i'm sure you've checked into that yeah the extensions it's every 90 days up to a year so essentially our first deadline comes january 1st but they'll give us the extensions up through September. After that, we're really at the mercy of them. They can decide to make us leave whenever they want.

1:43:33And ultimately, if we can't afford the work, they can bulldoze our house that we own. That is so insane. Wow. I'm sorry. This is terrible. This is like just rocking a hard place, a thousand percent. If I were you, I would look into what it would be to actually sell. I don't think, you know, interest rates are now around five and a half percent. And so if you have four to five and a half, I don't know that it'll be a huge jump and it might get you out of the situation. That's one option to look at if you can't increase the income. Because the problem is whatever the thing is, a$10 ,000 emergency, a$30 ,000, you guys are so tight right now.

1:44:08And for the foreseeable future, there's no end in sight. So this is just a hard way to live as you are finding out that home ownership is not cheap. And so I would try to find any alternative living situation and or move out if you can't come up with this money the next year. I don't know that begging and pleading with the state is going to get you very far at this point. So sorry you guys are dealing with this.

1:44:48It's one of the best times of the year, but it's also the time of year when people let their money get totally out of control. Everywhere you look, it's just buy, buy, buy. So you start swiping the credit card and suddenly it's January and you got a mess on your hands. Don't let that happen. Tell your money where to go instead of wondering where it went with our budgeting app, EveryDollar. EveryDollar not only helps you stay on budget and in control of your spending this holiday season, It also helps you find extra margin in your budget, thousands of dollars of it, and every day will coach you to build better money habits and attack your goals faster than ever.

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1:45:55Welcome back to The Ramsey Show. Big news from our friend Jade Warshaw. Her new book, What No One Tells You About Money, is on pre-order right now. For$24.99, you get over$100 in free bonus items, including the enhanced audiobook, read by Jade herself, early access to the e-book, and instant access to an exclusive video, your financial checkup with Jade. Plus, she's doing a book club with a live Q &A. That's correct. Who doesn't love a book club? It's for three weeks. You can get access to all of that when you pre-order today, RamseySolutions.com slash store. Click the link in the description if you're on YouTube or podcast.

1:46:28Very exciting. All right. Tim is in Houston up next. What's going on, Tim? Hi, guys. Just kind of a real quick question. So we've got a destination wedding coming up in about six months. and best price is about$2 ,500 to go there, hotel, rent a car, pet sitting, food, and that sort of thing.

1:47:00However, right now, it's not like we're totally broke, which we're not, But the problem is that I really don't think that this is a good thing for us to do at that time. And I know that the people that invited their lifelong friends, loved them to death, I know that they would be devastated. Tell us more about your financial situation and why you think it's not a good time to spend this money. Okay. It kind of goes back about, oh, I guess about six years ago. I'd been involved in aviation for a number of years, and I saw a new technology pop up. I took it to my company vice president, and I said, hey, look, I'll get my commercial drone license.

1:47:53We'll do this, that, and the other. And I ended up spending probably out of my own pocket because I wanted to also do this as a profession, about$100 ,000. And I went into debt about$40 ,000 on unsecured loans. And then the shutdown hit us. And I was out of work. I had to do engineering consulting on the side.

1:48:22Fortunately, God saw my dilemma and said, look, I'm going to put you here as an engineering manager. And my wife, who came alongside, she said, we're going to buckle down. I'm going to get home to Ramsey's consulting group. And so we brought a consultant on. And about six months ago, we paid off all of our vehicles. We have two vehicles. That's gone. All of our credit card debt has been wiped out. Great. We owe about a little under$90 ,000 on our home. It's probably worth$450 ,000. Okay. And have you saved up any money yet? That's the big thing. so me personally I've had some health things hit me I had an accident I had three surgeries prostate cancer I'm sorry I was almost blind in one eye and couldn't see out of the other one so I had that cataract surgery have you managed to stay debt free through all of that well my wife really likes to travel So she's also booked some vacations, and we would get ahead and then back.

1:49:47So where are you now? How much debt do you currently have, and what do you guys currently make? So this is going to sound crazy. Hit me. I bring home a little over$11 ,000 a month, which is a pretty good chunk of change. Yeah, but tell us how much debt you have. Well, right now, we just paid off our last vacation. We've had some things here. Tim, Tim, one word answer. How much debt do you have outside the mortgage? $90 ,000 on our home. That's it? That's it? No consumer debt? No consumer debt. Okay. You were making it seem like, Tim, that you guys bought a theme park and you did all sorts of things.

1:50:34Can we agree we're not going to go into any more consumer debt for any reason? Well, let me just say that we just took on a$13 ,000 repair to our house. But I thought you said the only debt was$90 ,000. What do you mean took on? So, yes, we did take that on. As a HELOC? It's going to be about$800 a month out of our pocket. Tim, you just told us you had no debt. Well, I'm sitting here looking at my notes. So$13 ,000. You have$13 ,000 in debt and you have nothing in savings. No cars, no nothing. That's it. Okay. And no money saved. And very little saved. Now we do have... How much saved? Retirements.

1:51:20We do have retirement out there that we can't touch. Yeah. How much cash? That's about$100 ,000. Okay. We're trying to answer your question about this destination wedding. So you have$13 ,000 left in consumer debt. You have nothing in savings? We've got about$5 ,000. $5 ,000 in savings. So you could use$4 ,000 of that to attack the$13 ,000, bringing it down to$9 ,000. Then how quickly making$11 ,000? Your wife isn't bringing in income right now? There's some things going on. She's been doing consulting work, and it's not a lot. So let's pretend it's your$11 ,000. How much do you guys need to cover all the bills?

1:52:02Per month. Right now, I mean, I think we're in pretty good shape. I told my wife, no more vacations. Yeah. Well, the thing is, you guys aren't making a budget. This money is slipping through your fingers, and you will go into debt willy-nilly on a whim, because life is just happening to you. And so this is the part we need to get ahead of. Because truthfully, there is a world where you can knock out the rest of your 9K in debt if you do it our way. You can build up an emergency fund and you could probably go in this wedding, go to the wedding. But I don't think you guys have it in you to follow a plan at this point unless you get on the same page and have a come to Jesus meeting tonight and go, we make$11 ,000.

1:52:41Why are we going to debt for anything? I know. That's what I said. It's crazy sounding. And it is. But it's you guys. It's you guys choosing. And there's some behavior that has to start happening in order for you guys to right this ship. And that choice is yours. You know the plan. You know what the steps are. You've done it before. There's something there that's a blocker for both of you going forward with this. Could you scrape together$4 ,500 a month, Tim? $4 ,500 a month out of your income to throw at the debt? Oh, we'll get this repair. We'll get it knocked out pretty quick. I'm asking you, can you do$4 ,500 a month?

1:53:25um i don't know why we couldn't you tell me because so far we haven't been able to take 4 500 it's because you haven't seen it on a budget it's because you haven't seen it on a budget if in two months you would knock out this debt if you take 4 000 from your savings throw it at the debt you have nine left 4 500 a month you're done in two months and then 4 500 a month after that you'll have an emergency fund within three or four months and then one more paycheck and you can fund this whole destination wedding. So I think the problem could be solved. I don't think you guys should go in the destination wedding.

1:53:56I think your life is too chaotic right now, and I think your friends would understand after 19 surgeries and a lot going on, you take them out to a really nice dinner when they're back. Say, hey, we want to treat you to a real fancy dinner. We're unable to make it for reasons, health reasons, financial reasons, whatever. And where is the destination? Just curious. It's in Colorado. Okay. Yeah, I think they'll be strong. Well, you know, I know that there's a lot more to that whole scenario than my wife's daughter's, the bridesmaid. Listen, here's the thing. You could go out, and I don't know that you can with what you've been through, but maybe your wife could go out.

1:54:37You've got six months before this thing happens. You could door dash and say, I'm going to door dash until I earn the$2 ,500 to take this trip. Then we'll go. It'll be debt free. It won't be part of our usual income. Sure, you could do that. If these are family friends, you know, I get it. I'm not going to try to make you miss out on a huge moment if these are really special people in your lives. I'm not going to say that. But you have to go out and get the money. And I don't know that you guys will do that. That's my only caveat here. If you do this, somebody needs to go out and earn it. So the key is if you guys can get completely debt free with an emergency fund and save up for that destination wedding before it happens, then you have the green light to go on my part.

1:55:17but at this point the way you've been talking around things with lack of clarity lack of a game plan for you and your wife it just tells me this is going to take longer until we figure this out so i hope you guys can get on it i hope you can make it to the wedding you have the income to do it

1:55:46Hey friends, our Black Friday sale is live. So if you're already feeling the pressure of holiday shopping, just take a deep breath. You'll find great gifts for everyone on your list. And with prices as low as$6.99, you won't wreck your budget. Pick up best-selling books like The Total Money Makeover or Baby Steps Millionaires for just$12. Skip the shopping chaos, friends, but don't wait. These deals won't last. Visit RamseySolutions.com slash store.

1:56:27Our scripture of the day, Matthew 7, 2. In the same way you judge others, you will be judged. And with the measure you use, it will be measured to you. Mark Twain said, good judgment comes from experience, and a lot of that comes from bad judgment. That'll preach. That's great. That'll preach. The bad judgment leads to the experience, which hopefully, if you learn from it, leads to good judgment. Yeah, yeah. That's wisdom. You got to learn from it. All right. David is in Tampa up next. What's going on, David? Hey, George. Hey, Jade. Thanks for everything y 'all do. Absolutely. What's your question?

1:57:02So just a little background. I've been a longtime listener. Followed general principles, but I've been very Dave-ish recently. So just trying to dive in and make some moves just after revaluating some goals. So I'm currently in school. I work full-time as well, so I've just been cash flowing school. I currently pay$1 ,000 a month towards the program. And then at the end, I could just pay off the balance in full. so I've just been stacking cash instead of working to pay off debt. I also have debt that I'll talk about in a second, but I have about$35 ,000 in savings, and then the rest of the schooling program is about$30 ,000.

1:57:43Also, I'm in$200 ,000 of student loan debt, so I'm just trying to kickstart my journey right here and wanted to see if you all recommend I just pay off the rest of my school balance and then that frees up my$1 ,000 a month to just contribute to paying my student loan, or should I divvy it up, pay some of my school, and pay some of the student loan? Wow. What are you going to school for? Nurse practitioner. Okay. So the$200 ,000 was your undergrad? $200 ,000. I'm also a chiropractor, actually, so undergrad plus chiropractic school. Wow. Okay. Is that a combination? What are you going to be doing at the end of this?

1:58:22yeah so i'm looking to just uh expand my scope of practice as a chiropractor i currently can't prescribe medication or do injections um so i'm just looking to be able to provide more services for my patients so okay my game plan and what are you making per month per month about eight thousand okay so you can stack cash pretty fast my goal would be to avoid going into any more debt and if that means pausing the student loan debt while i cash flow this the rest of school i would do that. It sounds like you're already doing that though, right? Yeah, I've got, I could pay off my schooling program today.

1:58:58So I want to see if y 'all recommend that or should I pay some of that towards this? You're already, you're already cash flowing like the current year. And then you've got, did you say, I didn't hear if you said it was 30K for the rest or 20K? 30K for the rest of the program. Okay. About 35. Yeah. So you keep 5 ,000 saved and then you could, I mean, essentially, you could drop that down to$1 ,000 on the$200 ,000, and with your$8 ,000 a month, how much of that would you be putting on the$200 ,000 chiropractor deal? About$4 ,000 a month. Listen, get into it. I love that. That's about$50 ,000 a year.

1:59:39So worst case, you're done in four years. Now, hopefully your income is going to drastically go up, right? Right. That's the plan. And what is that going to take? Thank you. What do you mean? I'm sorry. How do you get to$10 ,000,$12 ,000,$15 ,000 a month income from where you're at right now? Well, I could open up my own practice. That's definitely a long-term goal. I just want to approach that correctly without going into any debt. Yeah, that sounds super expensive. Usually when people say that, it's like, well, I took on a million dollars of debt to start my own practice. Right. What's the other way to do it?

2:00:14No, that's not on the radar at all. I mean, just continue working where I'm at. maybe work more hours with additional responsibilities as a nurse practitioner role as well. So are you going to get paid more once you're done with the NP program? I'm confused why that's helping you right now as you're working for someone else. Well, the nurse practitioner program is more long-term for when I'm on my own, but the current practice I work at is multidisciplinary. So they have nurse practitioners that provide other services as well, so I can get an increase in salary where I'm at. That's what I was aiming at.

2:00:49Can we get an instant pay increase when you're done with this program? Right, because we'll be able to provide more services. Yeah. The goal would be to knock it out even faster than four years. And if you stay focused, keep living like you are now, keep living on lesson you make, you'll get there. But I like the plan of, you know, when is that$30 ,000 due that's left for school? Is that a per semester payment you need to make? Oh, no. That's not due until January 2027. Okay, great. Because I'm like, if it's not due yet, I would wait until it is due. Okay. Okay, so you recommend I just hold on to that for now?

2:01:20You keep it in a high-yield savings account, and then when the payment comes due, you'll know you have the money. As long as you won't go spend it elsewhere. But you recommend I don't just pay it all off today? Well, I mean, when you say it's due, is it just the payment is due? It's not a debt currently. No, it's not debt. It's just a payment plan. And at the end of the program, then you just pay off the rest in full. So I'm just paying$1 ,000 a month. Is there any, can you garner any incentive to pay it early? If you said, hey, I'm going to pay this all cash up front, would they give you 5 % or 10 % off, for example?

2:01:54I'd ask. I've not asked that, but I can definitely ask that. Worth looking into. I'm looking for any way to make this cheaper and make this go faster, but you're on the right track, man. You're doing a lot of things right. I'm proud of you. Usually you get these calls from, you know, the chiropractors and the NPs. I mean, he's got a lot of debt, but he's making the right moves to get rid of this fast. And I think he'll get there quickly. Joe is in L.A. up next. What's going on, Joe? Hi. Thanks for taking my call. I got a question. I have currently, me and my wife, we work, we both have two incomes.

2:02:29I have about$100 ,000 in high-yield savings account right now. And my question is, should I use that towards, I have a high mortgage. It's$4 ,500 a month, 7 % interest rate. should I use that to pay down my mortgage and maybe get a better interest rate or should I keep that in the high-yield savings account? What do you guys recommend? Well, I have two questions before we decide. First off, I want to know how much you bring in every month with all those four incomes combined. You said you and your wife both have two jobs. It's one and one, one job and one job. Oh, I thought you said you and your wife both had two.

2:03:11Okay, well, what's the income total? 10 grand for both of us. Okay, that's why you're hurting. That's half your take-home pay. Do you have any other debts? Yeah, we do have 15 grand in debt, but we're not getting hit with any interest or anything. That's kind of a 0 % interest rate. It's a consumer debt, but it's on credit cards for 18 months financing credit cards. And what are the payments? It's still a payment. payment yeah it's still very uh payments are about 500 a month yeah man this the the mortgage and these credit cards are eating your lunch yeah you got a can of bear spray right now and there's a bear coming at you i'd use the spray in the can and that's your 100k so i would pay off your 15 000 today that leaves you with 85 uh then you have the mortgage that's all that's left right yeah the mortgage which is 518 518 000 yeah so paying it down isn't just gonna lower the payment You're going to have to refinance or recast it in order to get a different payment.

2:04:13Are you talking about refinancing? I'm talking about refinancing because currently when we got the property, it was 7%. Now it's like at a 6.2. I'm hoping we could get like at a 5 later on. So I was kind of waiting to see if the interest rates go down. I've been watching them for the past couple of years. Yeah, you do the break even on that because the refinance is going to cost you. And so you find out how quickly you'll actually recoup that money and how quickly you can get this manageable. But I like the plan of taking$15 ,000, paying off the debt, and leave enough for your emergency fund. But anything above that, chunk it at the mortgage and refinance.

2:04:52And it's going to lower your payment to make it more manageable. I'd love for you to get this payment closer to$3 ,000. Yeah. Because right now, half of your take-home pay is going just toward this mortgage. is there a world where you guys increase your income um yeah actually my wife's working on her pe did her pe um professional engineering uh license how long will that what's the timeline uh hopefully the next couple months oh she's studying she's studying right now so she's just got to take the state test okay awesome yeah and then me i'm trying to go back to school so i can get my degree too.

2:05:31So we're trying, we're trying to increase our income. But as far as, yeah, the rate, so I should just wait until... I would contact our friends at Churchill Mortgage. Yeah, contact our friends at Churchill. They can run the numbers with you and show you, hey, does this make sense right now or not? But I think if you paid down the loan by another 50 grand and refinance, I think you could see the numbers start to make sense. So give them a call and see what they have to say. But I would knock out this debt today at least and use anything above the emergency fund to start tackling that mortgage. That puts this hour of the Ramsey Show in the books.

2:06:05Remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.