You Can’t Win With Money Until You Decide What Matters Most

7:10Dave Ramsey:Someone else bought a house.

7:15Dave Ramsey:hello number three rent to own is not owning it's renting okay i mean let's just use the words the way they're supposed to be used and and get it out from under dreamscape shoot me oh my god there's nothing good about this is such a dysfunctional mess the poor girl bless her heart oh man i can't even imagine the last thing i want to do with my kids is to put this many wedges in between me and them and because i gotta tell you where i was on saturday afternoon i was sitting on my daughter's back porch eating hamburgers that my son-in-law cooked and everybody was there all the kids all the grandkids all 16 of us were back there and we had no discussions like this.

8:03Dave Ramsey:Right. At all. That's true. None. None-ya. None-ya. I don't even get to choose where we're having dinner. I just have to go where I'm told. That's exactly true. So, I mean, it's not even close to me having control of that. Wow. Scary crap. Scary crap. People don't do scary crap with your kids and then expect them to be hanging around with you loving grandpa. it's not how it works.

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10:35jason's in las vegas hi jason how are you doing well sir how are you better than i deserve what's

10:42Dave Ramsey:up.

10:43Ken Coleman:Well, I'm having a little dilemma. I have some money saved, and I was thinking of potentially taking out an auto loan, although I just had a car last year that I was able to sell for positive equity, and I used that positive equity to buy a motorcycle. But now that I'm sure you're aware I'm in Las Vegas, the summer is right around the corner, if not here. It's starting to heat up. I I definitely need to get a car with air conditioning because riding around is kind of killing me and I'm sweating a lot. But I also don't want to fall into a trap where I'm stuck with a car payment because I'm not a huge fan of payments.

11:24Ken Coleman:I try to minimize them the best I can. How old are you, 22?

11:30Dave Ramsey:I'm 32. 32? Really? Yes, sir. Okay. Wow. All right. And what do you make of yours, sir?

11:40Ken Coleman:Uh, anywhere from 45 to 55 ,000.

11:44Dave Ramsey:What do you do?

11:46Ken Coleman:I'm in the hospitality industry.

11:48Dave Ramsey:Okay. In Vegas. No kidding. Okay. Um, all right. Well, um, you're obviously new to our stuff and to this show. Um, we teach people the shortest method to wealth is to get out of debt and stay out of debt because your most powerful wealth building tool is your income. If you take the average car payment of$700 a month and you invested that from age 32 to age 67, you'd have over$7 million. That's what the car payment costs you. And if you want to ensure that you stay at the middle class level or lower of wealth, keep a car payment your whole life. And that will make sure that you stay there. And so that's the framework that you walked into with this question.

12:41Dave Ramsey:and so what is the motorcycle worth?

12:45Ken Coleman:I would say anywhere from$4 ,000 to$5 ,000.

12:48Dave Ramsey:Okay, all right. And I'm assuming you have no money?

12:54Ken Coleman:Well, I have about$12 ,000 to$13 ,000 saved.

12:57Dave Ramsey:In what?

13:00Ken Coleman:Just bank account, and then I do have a small IRA, but I had to withdraw a lot of it during the COVID pandemic, so it's not as much as it was before, but I'm slowly trying to build it back up. Yeah, okay.

13:17Dave Ramsey:Well, I mean, you had your little run with the motorcycle, and it worked out for a while, and then the heat comes up in Vegas, and it's time to get an air conditioner. That's logical. Makes sense. You kind of knew that was coming. If you didn't see it coming, there's something wrong with you. It gets hot there in the summer. And so what I do if I were in your shoes giving you the outline I just gave you, the best way to build wealth is to avoid payments and you need an air conditioner, I would sell the motorcycle. I'd take$5 ,000 and my$12 ,000, and I'd buy a$10 ,000 car for cash and have no payments.

13:53Ken Coleman:That's a bad idea, actually.

13:55Dave Ramsey:Pretty good idea. That's why I have a show.

13:58Ken Coleman:Or my other idea was just thug it out with the motorcycle and then use what I would be making if I were to take out a car loan and just invest it in an index fund and then just let it grow.

14:13Dave Ramsey:I'm sorry, you mean borrow on a car so that you can invest?

14:18Ken Coleman:No, no, no. I'm saying like instead of getting the car like I originally thought about doing.

14:24Dave Ramsey:Oh, just stick it out and just be sweaty.

14:27Ken Coleman:just be sweaty and then just keep, you know, using the money like the$500 to$700 I would be making for that car payment. And just, you know.

14:34Dave Ramsey:Yeah, you're not going to have a car payment, though, because you're going to pay cash for a$10 ,000 car.

14:39Ken Coleman:Right. Yeah. Well, but then that would deplete a lot of my savings.

14:42Dave Ramsey:Deplete$5 ,000, you'll have$7 ,000 left, and you've got no payments. Remember, you called us. If no payments, you can actually build wealth. But the sweating, you have to decide,

14:53Ken Coleman:am I going to tough it out with a motorcycle, cycle or do I not want to sweat very much?

14:57Dave Ramsey:There's no$500 car payment in the equation here. None. No car payment at all in the equation. If you're asking us, I mean, that's what I would do if I was 32 and I lived in Las Vegas and I was single and I made$45 ,000 a year. I'm getting an air conditioner to start with.

15:15Ken Coleman:And then build the emergency fund next. Yeah. Right. And then I'm

15:20Dave Ramsey:going to start building some wealth and work more, make more, work more, make more.

15:25Ken Coleman:What's the path to six figures in hospitality? Or if it's not a path there and you don't want to be in hospitality, decide what is it that I want to do and start to get very intentional at 32. The good news is you've avoided a lot of crazy debt at this point. Bad news is you don't have a plan and we do have a plan. So welcome to the show and the baby steps, but all you got to do walk this out, you know?

15:49Dave Ramsey:What you're going to have trouble doing because you've done a lot of stuff in your life to date on a whim, on impulse, is you're going to have trouble avoiding impulse if you don't set this in stone right now and say, I am not going into debt and I'm going to go pay cash for a car. You're going to wander onto a car lot and some Porsche is going to wink at you and you're going to leave with an$800 car payment. That's what's going to happen. but she's going to flirt with you, and then you're done. So you've got to be careful. It's happened to me. You can tell. I can't walk by a nice car. I love a good car.

16:26Dave Ramsey:But, yeah, it'll kill you. It's the biggest thing that we all buy in America that goes down in value, and they go down in value like a rock. A new car loses 70 % of its value in the first four years. that's turning 30 000 bucks into you know just a few thousand dollars in a heartbeat and um i mean think about it how fast i mean they go down in value like a rock that's where chevy got that like a rock and so i mean it's just crazy y 'all and you just you got to be careful with these things they're cars are something you consume only when you have extra money around And, you know, a situation like that young man's in, he does not have extra money around.

17:12Dave Ramsey:And you're right, Ken, a whole series of intentionality moves on his part would make the next five years of his life completely different. No question. We can't wander from thing to thing impulsively. It doesn't work. AJ's in Gainesville, Florida. Hi, AJ. What's up?

17:31Ken Coleman:Hey, how's it going, guys?

17:32Dave Ramsey:Better than I deserve. How can we help?

17:35Ken Coleman:hey so um i'm in my late 20s um we me and my wife we bought a house uh we should close our first house in september um and we got our first baby on the way she's doing may yay yeah and so so we just finished baby step three working on baby step four now um and so i guess my question for you is um i've been working for about the last six months now I've been working two jobs. My wife works full-time also. We're trying to grind a little bit while we can. I work seven days a week, 60 hours a week.

18:09Dave Ramsey:What are you doing with all the money?

18:12Ken Coleman:Saving it currently. Are you out of debt? Yes, yes. We're on babysit three right now.

18:19Dave Ramsey:Oh, okay, good. Okay.

18:21Ken Coleman:Yeah. So my question is, we're trying to decide if when the baby comes, if I continue working both jobs so that my wife can stay at home or if it's more beneficial for our family for me to cut back the second job and then she goes back to work full-time as well and put the baby in daycare.

18:43Dave Ramsey:I don't think that's happening, dude. Do you? You see her sitting with a brand-new baby in her lap going back to work when she doesn't have to?

18:55Ken Coleman:No, not at all. I don't see that happening. That's why, yeah, our debate is.

19:02Dave Ramsey:But you bought a house you can't afford unless you work two jobs or she works one.

19:08Ken Coleman:No, no, no, sir, not at all. Okay, so why can't both of you quit?

19:12Dave Ramsey:I mean, you go down to one job. Can't live on your job?

19:17Ken Coleman:No, we need at least two incomes.

19:20Dave Ramsey:I know. Why? House payment, right? You don't have any debt. Right. So you bought a house you can't afford on your income.

19:32Ken Coleman:Right, yeah. We saw it as household income, so yeah. Yeah, so there's a third option.

19:38Dave Ramsey:You know, we can't live here, but I can work 40 hours, and you can stay home. And we have to live someplace else. That's another option. Hmm. You're making choices. You're working to buy a house, is what you're working for. Not to live, but to buy that house. Music Music Music Music

20:09Music Music Music Music Music Music

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21:50Dave Ramsey:The Live Like No One Else cruise is back. If you are on Baby Step 4 and beyond, meaning you're out of debt and you have your emergency fund in place and you want to come hang out with us and celebrate some of your financial milestones, we'd love to have you. We completely sold out the first cruise, and the second one is not quite sold out, but we're getting there. It's seven days. Super high-end cruise. Very nice. This is not Walmart on the seas. This is the good stuff. The Neptune suites have already sold out. We're going to be going in one year. in March of 27, one year from right now. And it's the only cruise where you can hang out with us.

22:26Dave Ramsey:All the Ramsey personalities will be there. And we're going to be doing sessions and teaching and laughing together and hanging out together. We have lots of our special friends from the celebrity world hanging out with us as well and doing music, all kinds of fun stuff. So lock in your spot with a$600 deposit before it's too late. We're going this time to the Western Caribbean, so Jamaica-mon. Yeah. RamseySolutions.com slash events. RamseySolutions.com slash events. Ashley is in Boston. Hey, Ashley, what's up?

22:58Ken Coleman:Hi, Dave. Hi, Ken. Thanks for taking my call today.

23:03Dave Ramsey:Sure, what's up?

23:06Ken Coleman:So, sorry if I get a little emotional, but we've been in storm and stork mode for a year and a half, and we just aren't really sure what to do next. Okay.

23:20Dave Ramsey:So that means you have a baby on the way.

23:26Ken Coleman:Well, he's here. Okay, good. When was he born? He was born in the beginning of October. Great.

23:33Dave Ramsey:How's he doing?

23:34Ken Coleman:But he's having a lot of medical challenges.

23:42Ken Coleman:We both were almost lost during birth, so it's been a really difficult recovery. We're both still in the hospital pretty much every week.

23:51Dave Ramsey:Wow.

23:52Ken Coleman:From what? So there's a variety of things. For me, it's a lot of physical issues related to the birth and some complications. And for him, there's a variety of things, neurological, his feeding and his intestines and GI. On Friday, we had to go because he stopped breathing, and I found out that that's just part of his conditions.

24:28Dave Ramsey:So what do you guys, I mean, you've been through hell since October.

24:34Ken Coleman:Even the October before that, when I was laid off from my long-term job. Um, so it's, it's been a, yeah, it's been a while.

24:45Dave Ramsey:Yeah. So what does your husband make?

24:48Ken Coleman:Um, he has a full-time job and side hustles and his full-time job is sales. And so he makes at least 55 a year. Um, some months we're up to 8 ,000 from his income alone. and then side hustles, a lot of reselling, and we've delivered things and done things like that as well.

25:15Dave Ramsey:Okay. All right. And so since October, you've been down for the count for sure. I mean, you're just trying to heal and get baby healed and get back to some level of normal, right?

25:28Ken Coleman:Yeah.

25:29Dave Ramsey:Okay. Yeah. And what did you used to make back in the day?

25:34Ken Coleman:At my previous long-term job, I made$65 ,000 a year. And then the job that I started before I went on maternity leave, I was making, it was estimated to be about$40 ,000 a year.

25:54Dave Ramsey:Okay. And how much debt have you guys got?

25:59Ken Coleman:um well we currently have um i'm sorry is it okay if i break it down by like credit cards and stuff um and credit cards totals based on the credit report it's about 30 000 um i'm reaching out to request details um as a lot of them have been sold off to debt collectors we have a car that we owe$12 ,300 on. The online payoff amount shows$12 ,200. I think most of the interest was front-loaded, but it's worth about$6 ,000 to$8 ,000 private party sale due to damage and mileage. We have a home. Our debt on the home is just under$347 ,000.

26:53Dave Ramsey:What's the house worth?

26:57Ken Coleman:We had it listed, and the only interest that we had was for under$370 ,000, and they wanted us to cover.

27:12Dave Ramsey:What did the real estate agent think the house was worth?

27:17Ken Coleman:He thought it was worth$369 ,000. No. The older home was the...

27:24Dave Ramsey:No, the only interest you had was at$370.

27:30Ken Coleman:What did you have it listed at? $375.

27:34Dave Ramsey:Okay. All right. Okay. So you don't have much equity. Okay. All right. So what I'm always looking at when I'm in a situation like you're in is there are some things I can't control, and there are some things I can control. and I get anxiety mostly not from the things I can't control but the things I can and I'm not and so what I'm starting to look at is okay what can I what can I control in this situation what can you do you can't control the baby's health that's up to God and the doctors right you can't control your health exactly other than the things you have to follow the doctor's directions on in both cases, the baby and you, right?

28:16Dave Ramsey:But right now, you know, right now the things that are a given in this story, as I understand it, is we've got a sick child that's trying to heal and a sick mommy that's trying to heal. And that's okay. That's okay. It's not good. It's not fun. But that's not anything you can do about that. You can't wave a wand and, you know, fix that. Agreed?

28:39Ken Coleman:Yeah.

28:40Dave Ramsey:Yeah. So it's going to take a minute. give yourself a little grace and give yourself time to heal and so forth. Your husband sounds like he's an excellent man. I love this guy. What did he do? He went to work and made sure his family had money. Wow.

28:53Ken Coleman:He goes above and beyond. Yeah, he does. I like this guy a lot.

28:56Dave Ramsey:He's a good man. All right, cool.

29:00Ken Coleman:Oh, I'm sorry. I thought you were going to make another point. Well, listen, this is all you can't control is his effort, right? So he's going to keep working. Can he get better paying gigs? We're selling everything. We're going to try to whittle this thing down and get some momentum. Right now, with all the health stuff, it has exacerbated all of the financial stress. And Dave just did a great job of really laying this out. You've got to make that switch to the best of your ability, mentally and emotionally, to focus on what we can't control. So how can we begin to chip away? We're upside down in the car.

29:33Ken Coleman:We need the car. It's not out of control. It's not completely out of control. That's doable. So really, how do we begin to get some real momentum through additional income, doubling down on the budget, making sure that we are only doing what we have to do right now? And, you know, your husband, again, is doing the right thing and staying with it. I'd like to see his income get a little higher in that sales role. I'd like to see him approach six figures in a sales role. And so maybe, maybe that's what he's looking for. I know he's working like a crazy man right now, and we admire that. But if I was in his situation, I'd be going, how can I double my income in a sales function?

30:12Ken Coleman:That's what I would be trying to do.

30:14Dave Ramsey:Yeah, and talk to a Ramsey trusted real estate agent and have someone else come and look at this house and consider if that's going to work or not. I don't know if it's going to work or not. It doesn't sound like there's a lot of room there. But if the house payment's bothering you and you can get way down on house payment. So here's the thing. If you can retreat back to safety, give yourself room to heal, one thing's for sure. It'd be very unusual, and I've been doing this a long time, sitting in this thing. I can't think of a single case that I've worked with that 10 years later, you're in exactly the same spot with your health.

30:46Dave Ramsey:Yeah, that's true. I mean, you're not going to be in the same spot with your health 10 years from now. So this is a, as you said, a rough patch. It's not a destiny. It's not the prescription for your whole life. So you guys keep scratching and clawing, and then the sun will start to come out, and then there'll be a light at the end of the tunnel that's not a train finally. But in the meantime, you've been through a hard time. And, hey, we're with you. I'm with you. I think your emotions are real, and I would have them too. So keep pushing. Keep pushing. But also give yourself a little room to say, if we don't make any progress right now other than healing, that's probably okay for right now.

31:56Ken Coleman:We'll see you next time. Keep your number and pay just$25 a month forever on the unlimited plan. Because you've got better things to do with your money. So go to BoostMobile.com slash Ramsey to make the switch today. Based on average annual payment of AT &T, Verizon, and T-Mobile customers compared to 12 months on the Boost Mobile Unlimited plan as of January 2026. See website for full details.

32:31Dave Ramsey:Hannah is in Grand Rapids, Michigan. Hi, Hannah. How are you?

32:35Ken Coleman:Good. How are you?

32:36Dave Ramsey:Better than I deserve. What's up?

32:39Ken Coleman:Well, I'm renting an apartment to a former co-worker of mine. And originally it started out where I was trying to help her out, get her back on her feet. She was going through a breakup and she had two kids and they were going to be homeless. and now it's to the point where I'm wondering if I'm just enabling her poor financial choices.

32:59Dave Ramsey:How long has this been going on?

33:02Ken Coleman:Two years. She's been there almost two years. Okay.

33:06Dave Ramsey:Well, at what point was she supposed to get back on her feet?

33:10Ken Coleman:Well, that's a good question. Right now I'm charging her$750 a month in rent, and that's including all her utilities. The apartment should be about$1 ,200 a month in rent. she was doing all right and then she was in a car accident didn't have any insurance now she's got a bill a bill for that and then she got into another car with those $40 down deals and she's $20 ,000 in debt on a car that's only worth maybe$6 ,000 she's paying more on her car than she's paying me for rent so I don't see her getting out of the hole anytime soon

33:53Dave Ramsey:okay so instead of getting back on her feet she dug the hole deeper yeah pretty much by not having insurance and making a bad car decision yeah and i just recently found out well she she missed december rent she's caught up now but she missed that for she's buying christmas stuff for kids and i found out that she's paying 200 a month

34:15Ken Coleman:almost to rent couches for her apartment.

34:23Dave Ramsey:Okay.

34:24Ken Coleman:And she only makes about$3 ,000 a month, I think. Okay.

34:30Dave Ramsey:So how does this end? When does this end?

34:36Ken Coleman:I mean, either I raise the rent and then she gets behind and I have to evict her, or, I mean, that's really the only option I see. I could ask her to leave. I don't know how that would go.

34:50Dave Ramsey:I don't agree with you. I think if it just keeps deteriorating, you don't even have to raise the rent. She's not going to be able to pay it. It's true. She keeps making stupid decision after stupid decision on top of each other, and they're compounding, and she's going to bury herself. And then she's not going to be able to pay even your reasonable rent.

35:11hello hello yeah you agree yeah i agree you don't even have to raise the rent this thing's going to

35:17Ken Coleman:go down the toilet eventually anyway yeah so you know the question is are we just going to stand

35:23Dave Ramsey:by and watch that happen are we going to take proactive measures on the other side one way or

35:28Ken Coleman:the other so so i do i do have a lease with her that's up in next march yeah i mean i guess just I don't think she's going to make it a year. I don't. She works a seasonal job, and her hours will go down mid-summer.

35:43Dave Ramsey:What is her job?

35:44Ken Coleman:She won't be making as much. We both work in the greenhouse. Okay. So we, that's what I'm wondering. Is there an emotional attachment you have to this person that you probably have not or would not with other people that are leasing from you? Well, we used to work together, and we don't anymore. That ended about three months ago. I no longer work with her. And I also, I was living in, it's a triplex. I was living there as well. So as long as I was there and seeing her every day, that made it harder. And I no longer live there. So that's really helped me have more of an emotional break. Emotional break from having to see her and see her there, see her at work.

36:25Ken Coleman:And I'm really... You sounded emotional when you started talking to us. I could be wrong, but you sounded emotional. I'm just nervous. Okay. Well, you're doing great, by the way. You're doing great. Well, thanks. Yeah. Yeah. I'm with Dave on this one, but I would be planning. I would be planning on what are we going to do when she can't pay the rent anymore so that you're not stuck with this. Because this doesn't – there's just – you wouldn't do this for anybody else is the feeling I get.

36:51Dave Ramsey:I don't think that you can fix her life. Yeah. Because she's choosing not to. And you're not going to fix it. If you gave her free rent, she would screw it up.

37:06Ken Coleman:No, I think if I gave her free rent, she would go rent three more couches.

37:09Dave Ramsey:That's what I meant. She'd screw it up. Yeah. Yeah. Or a hot tub for the back porch or whatever. Yeah. And so. Yeah. Yeah. So I think we've got to, you know, you need to sit down and have a conversation with her human to human and say, all right, we started this so that I could help you. and here's what's happened since I started helping you you've gotten worse you rented couches you went around without car insurance and made a mess and then you bought a car that you absolutely can't afford that's killing you and so I'm thinking this is going to end poorly like you're going to not pay me rent and then I'm going to have to evict my friend who I was trying to help and this whole thing breaks my heart.

37:59Dave Ramsey:So you and I need to come to an agreement that says that you need to go live somewhere else because I'm not a blessing to you and I want to be a blessing to you. I want to be helpful to you and I can't be that while you're here.

38:15Ken Coleman:So maybe I should ask her to look for somewhere else before the situation gets worse?

38:20Dave Ramsey:Yeah, like now. I was talking about this conversation happens next week. Okay. Yeah, I want her to leave now. I want her to go rent something that she can afford that's cheaper.

38:32Ken Coleman:She can't get anywhere cheaper.

38:34Dave Ramsey:Yes, she can.

38:37Ken Coleman:I don't know where.

38:38Dave Ramsey:I don't either. I don't either, but it's not your job. Your job is to remove her. That's it.

38:45Ken Coleman:No, you're right.

38:47Dave Ramsey:Because this is not going to work out. You're not loving her by just doing nothing and letting this thing go down the drain. if you really do care about her help her move you know i'll give you a free rent i'll give you a free month's rent or i'll refund next month's rent if you're gone by the end of the month and that'll help you get started on your new thing and give her 750 after she moves out okay i can do that and then go rent the stinking thing for 1200 and the next time you get ready to help someone, you need to think about what help looks like and where this is taking us. Because giving her a place to live did not keep her from being homeless.

39:33Ken Coleman:Yeah.

39:34Dave Ramsey:Hello. You used that line in your head, and you used it on us, but I'm not buying it. She would have figured out something. She's always figured out something. and the the only way that i help someone in a situation like that is if i get down under the thing and i start going okay we're going to be on a budget we're going to work six jobs there's no rental couches there's no car payments we keep insurance in place and we're going to ride herd on doing smart stuff with your money and if you do smart stuff with your money after a little while you'll have some money it's pretty amazing it's kind of it kind of works like every time and when When you do dumb stuff with money, you have no money.

40:17Dave Ramsey:It works like every time.

40:18Ken Coleman:I was going to ask you, how do you recommend people, like in this situation, deal with the guilt? Because she's a good person. The caller is a really good person, obviously trying to help out a former coworker. You can't be—your job is not Jesus.

40:32Dave Ramsey:That's right. But how do you begin to separate that? Jesus already took the job. It's his job. That's right. You're not signed up for that, and you don't have the skills for it. Right. Your job is not to fix everyone. You can't fix other people. The only thing you can do is set up a situation where they can do something. You set up a situation where they could do something and they chose not to do it. That's right. I can't make the lady stop doing stupid stuff. So a question could be, did I do everything possible? It's why I end the call here. Right. When someone calls and I tell them what to do and then they argue with me and I tell them what to do and then they argue with me.

41:02Dave Ramsey:The third time they argue with me, 100 % of the time, you all will hear me end the call. I am not going to try to talk you into this stuff. I'll show you what to do. And if you insist on being a stupid butt human being, you're going to be broke. And I'm going to just watch it happen. And I go home with no guilt. I turn off the microphone, get in my car, drive home. I don't even remember you called because it's not my job to fix your life. My job to help you show you how you fix your life. You're the hero in the story. I'm not the hero. I'm just a guy on the sidelines showing you what to do. I'm Yoda teaching you how to swing this lightsaber.

41:41Dave Ramsey:If you choose not to get in a fight, I can't help you with it. No. You know, you've got to step into the force yourself. I can't do it for you. And she can't do it for her friend. Yeah. And just giving her a place to live and calling that, oh, she would have been homeless otherwise. No, she wouldn't. That's bull crap. She wouldn't either. She might have had a hard patch and then worked it out. But you've got to stop doing the stuff. You keep doing the same thing over and over again. You expect a different result. It's the definition of insanity. And I got no guilt about that. That's not being calloused.

42:12Dave Ramsey:It's just, it's not my job to be Jesus. He's got that job already taken.

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43:32Dave Ramsey:Welcome back to The Ramsey Show and the Fairwinds Credit. at Union Studio. Ken Coleman, Ramsey personality, number one bestselling author, is my co-host today. Open phones at 888-825-5225. Jerry is in Columbus, Ohio. Hi, Jerry. How are you?

43:50Ken Coleman:Hi, Dave. I had a question for you. I've been married for 11 months, and I found out during our joint filing with my wife that she has four years of back taxes with the IRS, totaling about$48 ,000, and I'm looking for your advice on how to handle that.

44:13Dave Ramsey:Wow. That's a bummer. So is she deceptive or incompetent, or both?

44:27Dave Ramsey:Without sounding derogatory, I'd probably choose the latter. Incompetent. Yes. Yeah. I mean, like, it didn't occur to her that this was a problem.

44:43Dave Ramsey:No, she thought it would fix itself. Yeah. Okay. And that's why she didn't bring it up. She wasn't actually hiding it. It just was not on her radar as important. Yes. Where you're, like, in freak-out mode, and so am I. Yes. Yeah, like, ah! You're kidding!

45:01Ken Coleman:Holy Jesus!

45:03Dave Ramsey:Oh, my God. The IRS of all people. Okay.

45:11Dave Ramsey:So the first thing I want to pull the thread on, what else don't I know that you don't think is important? Agreed. And I had asked her this question about two weeks ago when we were filing,

45:26Ken Coleman:and then she came clean with the rest of it, because I saw from 2024, the tax year, that there was stuff that had been penalized, and I asked her about that, and if there was anything else, she said no, and then yesterday she brought up these other things.

45:41Dave Ramsey:Well, I mean, like three years ago I got a car repoed, and I didn't bring that up, but they're going to come to me for$30 ,000 one of these days. Right. But I don't think it's a big deal, so I thought it would take care of itself, so I didn't bring it up. I mean, what else is out there that I didn't think is important, so I didn't bring it up? Agreed. I really want to dig into that. And somehow, okay, so her reaction is not, it was kind of like a shrug, like, this is just no big deal? Or am I missing something? She views it as a big deal.

46:22Ken Coleman:Thought she could take care of it herself.

46:26Dave Ramsey:Oh, okay. All right. So what did that involve? because what I'm trying to do is establish your relationship pattern going forward.

46:34Ken Coleman:I agree. So she brought it all to me, and now I know what's on the table. We looked at her credit report to identify anything else, like you said. So I have a view of everything that's happening now.

46:52Ken Coleman:I just need to know what's the best plan of action. Do I pay it all as a lump sum? Yes.

46:58Dave Ramsey:If you have it. You have it? Yes. Okay. Yeah, write a check. Because the penalties and the interest, you can't, they're ridiculous. And there's no discounting with the IRS. They're made whole 100 % of the time. So, yeah, just the faster you can clean it up, the better. But I really want to make sure relationally that there's nothing else out there writing. You didn't see anything on the credit bureau. And I want to make sure that we're aligned on this is the worst financial moment of our entire lives relationally. It never gets any worse than this. Everything is better from here forward. We really need to both be on that page.

47:43Dave Ramsey:because i mean i'm i'm scared that this could happen again if there's not a like a i don't want uh an an acknowledgement that how damaging this is to a relationship by her so if that's not the case then you guys may need to sit down for a tune-up going with a marriage counselor just to get things dialed get some tools in both your belts to get aligned on that this is like grown-up stuff and you can't freaking ignore it and me be okay with that i'm not going to be okay with that and so we have to be aligned on that we together are know everything and together we are aligned and on every decision going forward so that there's never i'm never going to be surprised again the rest of my life if i'm you i'm not okay with surprises of this type.

48:35Dave Ramsey:And so that... And I'm just... Go ahead.

48:38Ken Coleman:We have our first baby coming in two months, so it's kind of all falling on top of me right now.

48:44Dave Ramsey:Yeah. Well, and so we're negotiating with the lady in her third trimester, too. This is just really not profitable. Yeah. Wow. Okay. Well, at some point in this process, and it may not be anytime soon, given that last piece of information, if there weren't a baby on the way in any moment, I would be in the marriage counselor's office for a tune-up to make sure I was aligned. But I may wait until the baby's four months old. But you guys need to have a conversation that she clearly, without you shaming her or yelling at her or something like that, but this is just we're not going to function this way going forward.

49:28Dave Ramsey:Okay. And then I'd write a check and pay it off. Because if it comes back again after you write a check and pay it off and something else pops up or she goes and does something else and forgets to tell you because it's not important, but it is important. I can handle it myself or whatever the bullcrap narrative was on this thing. And it was bullcrap. Then, you know, we don't want a repeat of this. We want to heal this broken narrative. Does that make sense?

49:52Ken Coleman:Yeah, and one of the things I was going to lean into is if you guys aren't already doing combined finances, that needs to happen today. So that, again, as we work through the relational stuff here, the financial stuff is also completely – everything is on the table. This is a tough feeling to have, but I agree with Dave. I'd stroke the check today. You don't want to be dealing with the IRS on this. And listen, it's going to suck writing that check, but it's going to suck worse not to deal with it. and to try to string this response out with a baby on the way.

50:24Dave Ramsey:No, no. Don't do that. I'll take care of it immediately. Get on the phone with them, find out what it is, and clear that. But we have to make sure that there's no repeat. Oh, yeah. That's the big thing here. And transparency does that. And so if you got fully transparent and then you're looking over her income and her withholding and the two of you are doing your taxes together and then there is a shortfall, then it's now your fault because you got your fingers in there with it, okay? And to Ken's point, when you combined everything and then it still happens, then now it's on you. So that's the whole process.

50:57Dave Ramsey:That's where I would go. But the big thing is this. Financial problems are never the problem. They're always the symptom of something else going on. So you've got to go down to ground. What's the problem? What's causing this? And what's causing her to not deal with this? Family of origin, we were ashamed to talk about money. or every time we talked about money, Daddy yelled, so I don't want to talk about money because I'm afraid you'll yell or I don't know whatever the bullcrap is that's under there, but there's bullcrap under there, I promise you. This is crazy. And it's not$500, it's$50 ,000.

51:35Dave Ramsey:That's not an oops, okay? $500 is an oops. $50 ,000 is bothering me. yeah man what a setup though I mean with a baby coming in too much wow

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53:33Dave Ramsey:Beth is in Detroit. Hi, Beth. How are you?

53:37Ken Coleman:Hi, I'm all right. How are you?

53:39Dave Ramsey:Better than I deserve. What's up?

53:41Ken Coleman:I'm calling to see if what your advice would be on selling our family home. We've got four kids in order to pay off a large amount of debt.

53:52Dave Ramsey:Okay. And so how much is a large amount of debt?

53:58Ken Coleman:So we owe$145 ,000 to the IRS,$145 ,000. And then we have$100 ,000 on our home equity line of credit. and then about almost$50 ,000 on medical expenses and car payments.

54:16Dave Ramsey:And what's your home worth?

54:20Ken Coleman:Our mortgage is for$470 ,000, and we have an offer currently that we just got for$755 ,000. So it would allow us basically to clear the deck and restart, but our hesitation is with just our kids.

54:37Dave Ramsey:Where did all this debt come from?

54:41Ken Coleman:so um my husband was the primary breadwinner i was home with our kids and he got into day trading um and i am guilty of burying my head in the sand and not getting involved in our finances so he he made quite a bit lost it just as quick and then turned to credit cards um and then didn't pay taxes on the capital gains he made with the trading before losing it all

55:15Dave Ramsey:Okay. There's not capital gains on day trading. There's ordinary income on day trading. And there's also a loss you can take if you've lost money against that.

55:27Ken Coleman:Okay. Do you really think you have the whole story?

55:33Ken Coleman:So I'm not entirely financially literate. This is something that I'm trying to get more involved in just in the last couple of years. taxes in particular. When did all this happen? This happened about, well, I think it was happening for quite some time, but again, I kind of was bearing my head in the sand, and he just came to me three years ago. We had a major health crisis, and he said, you know, I got to come clean. We owe quite a bit of money. I cleared out our 401k. I cleared out all of our savings.

56:05Dave Ramsey:Okay, so you've been limping along with us together for three years, with you having knowledge of it.

56:12Ken Coleman:Yes, sir. Yeah, we've been married for almost 20 years, but three years I've had knowledge of it. And what does he make a year? He makes$180 as a base, but he's in sales, but it's been a tumultuous and very dry couple.

56:28Dave Ramsey:And he's not day trading anymore?

56:32Ken Coleman:Correct.

56:32Dave Ramsey:Okay. All right.

56:38Dave Ramsey:okay so your your question was interesting you said um we would do this except for the kids i think you have to do it for the kids you have to get your life back for the kids your kids your kid the definition of your kids having a good life is not where they live. It's who their parents are and how they act.

57:01Ken Coleman:Yeah.

57:03Dave Ramsey:You live in a house that's way nicer than you grew up in. So do I. So does Ken. And we didn't die from that. And it didn't malform our character from that.

57:22Ken Coleman:Yeah.

57:23Dave Ramsey:So sell it and clean up the dadgum mess. If the problem has gone away, no more day trading and no more deceiving. And you guys are working together on this. Then he takes his 180 ,000 and hopefully more 250 ,000. And you guys work to rebuild your lives and buy another house someday. But in the meantime, I'm going to be free, baby. Set me free. And I think the stress level in the air of your home will go down, and the children will benefit from that far more than they were having that particular set of bricks and mortar.

57:57Ken Coleman:Okay, that's a good word. Yeah. Yeah, I'm just going to add, just do your own research tonight on how stress affects your physical health. It's not just the mental and emotional. We forget what it does to the body. So I would just add, if I had the chance to fix this, and I love the fact that he came forward three years ago, and if you guys are on the same page now, I absolutely agree with Dave. This is a reset, a reset with the idea, though, that we never do this again.

58:27Dave Ramsey:Yeah, I mean, he has to say, I lost our house. That's right. Day trading, I lost our home. That's how big a deal this is, okay? By the way, I lost everything and went bankrupt because of my choices, not my wife's. All right. When I when we went bankrupt 30 plus years ago. All right. So that's, you know, and I get to own that the rest of my life. But I also never did the things again that put me there again, ever again, again, again, never again. You see, I mean, you say, you know, I lost everything. I lost my home. We did not lose our home, but the only reason was there was no equity in it. and so so it survived the bankruptcy but uh and it wasn't that nice a house anyway but the uh anyway yeah we we just said you know we lost everything we get the opportunity to start again fresh and clean and uh in your case that's the sale of a house in our case it was a bankruptcy and we're never going back here again and we never went back there and we from that point forward we never i never bought anything that sharon and i don't both agree to investments or otherwise And so, yeah.

59:40Dave Ramsey:So I think it's fair to say, just to outline for everybody, just to let you guys know out there, this is not a unique situation. Here's the numbers. And this is the most bizarre number I have almost ever heard in the investing world. If you day trade for 36 months continuous, 97 % of you lose money. that's how stupid that is. I mean, if you said 97 % of the time you walk across the street, you get hit by a car, you would not walk across that street. Under any circumstances, you wouldn't be the one guy that says, Frogger, I got this. You wouldn't be that guy. You'd be going, no, those are not odds I want to play.

1:00:28Dave Ramsey:And there is something about the arrogance and pridefulness that says, I've got the stock market figured out. if you hear someone say that laugh at them they are funny people they're statistically stupid human beings 97 of you that day trade 36 months consecutively lose money now you need to hear that because some of you get a little fishing story where you hit a lick and you go oh i made some money and it's just like gambling in vegas now i'm going to go back to the table and the only part I'm going to remember is the time I won. I'm going to forget about the 16 times I lost. And when you add it all up, you lost.

1:01:11Dave Ramsey:That's how they build those nice hotels in Vegas. So true. And the same thing is true at day trading. You lost. Poor guy. Poor gal. What a horrible thing they're going through. But some of you people, man, you're sitting out there with Dave Ramsey doesn't understand. Listen, I understand. What I understand is why, what I don't understand is why you don't understand. 96 What other number do you have this 97 % of anything ever? That's not statistically significant. That's like a fact. You're going to lose money. Oh, my God. And it has the same trap that gambling does. Oh, it's the exact same trap because it's got a feedback loop.

1:01:50Dave Ramsey:It's the same thing as DraftKings. Same crap. Same exact thing. That's why sports betting has gone through the roof. It's a feedback loop, a scarcity feedback loop. And, you know, our friend Michael that wrote Comfort Crouch, his second book, Easter, his second book, talks about that a lot. And he went into great depth study on that, about the dopamine hits and how you just keep cycling back into this thing. You cycle back into this thing and it's, it's just pushing the same button. But it always has at its core this ridiculous arrogance that I can beat the house. It's just, it's arrogant beyond, pride comes right before you have to sell your house because you lost everything.

1:02:38Dave Ramsey:Wow. Pride comes right before the fall. Wow.

1:03:24Ken Coleman:Dave, we got a lot of calls on this show where life happens. One day someone's healthy, they're working, providing for their family, and then a curveball hits.

1:03:32Dave Ramsey:You know, we hear it all the time. A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes.

1:03:40Ken Coleman:Yeah, and that's why you've always said that having term life insurance from Xander is essential because it protects your family if the worst happens.

1:03:47Dave Ramsey:Yeah, that's right. You need 10 to 12 times your income in coverage. No gimmicks, no whole life junk, just straightforward term life protection. But there's another piece that people often overlook, and that's long-term disability insurance.

1:04:03Ken Coleman:Yeah, it's important to understand the difference between them. Life insurance steps in when you die. Disability insurance steps in while you're alive but can't work. So it replaces a large part of your income so the bills still get paid while you get back on your feet.

1:04:17Dave Ramsey:Now, if your employer gives you free disability insurance, great, take it. If it's discounted there at a better price, take it. But if not, Xander can help you find the right plan. Whether you're single or married, it's not optional. If you're going to be out of work for a while, then you need to make sure the money's still showing up.

1:04:35Ken Coleman:And that's why Xander is our go-to. They make it super simple to get the right coverage at the best price, no pressure, no upselling.

1:04:42Dave Ramsey:I've trusted Jeff Xander and Xander Insurance for over 25 years, and so has my family. So don't wait.

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1:04:56Dave Ramsey:Protect yourself, protect your income, protect your family.

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1:05:52Dave Ramsey:So don't live normal when you can live like no one else. Start every dollar for free in the App Store or Google Play. Zach is with us in Colorado Springs. Hi, Zach. How are you?

1:06:04Ken Coleman:I'm doing pretty good. How about yourself?

1:06:06Dave Ramsey:Better than I deserve. What's up?

1:06:09Ken Coleman:I can give context after the question because I follow you guys, and this is going to sound like I don't, but I'm wondering if there's a trick to increasing some credit problems so that I can get a house within 18 months, or if my credit score will go bye-bye in that amount of time.

1:06:28Dave Ramsey:Everything that we've seen, they do not publish this, but everything that we've seen in 6 to 12 months of the time you have zero activity on any account, your credit score will disappear. Okay.

1:06:43Ken Coleman:Are there any ways to guarantee that it does that?

1:06:48Dave Ramsey:No.

1:06:48Ken Coleman:My main credit issue is collection debts. Those will be knocked out within a couple of months, and I want to make sure nothing appears again after that. Yeah.

1:06:58Dave Ramsey:Well, if you have settled them, if they're not outstanding, there should be no more activity on the account once it's settled. Right?

1:07:13Ken Coleman:I believe so. I've had a couple pop-up that I didn't know were even in collections.

1:07:19Dave Ramsey:Well, that's why you can't make a guarantee. I mean, if you have something pop up, then the whole clock starts over, dude. So, I mean, you can't, you know. But if you've got stuff that's in collections or been in collections and you're having to settle it, the last thing you need to do is go into debt to build your credit score to buy a house. So you need to freaking do this in the right order, dude. I mean, listen to what you're actually saying here. It's kind of crazy. So, no, you need to clear the debts, get to zero, and zero activity. And if it takes longer than six months or longer than 12 months because something else pops up, well, that's something else popping up would have screwed up your other plan too, by the way.

1:08:03Dave Ramsey:If you're sitting there and the credit score is going up, up, up because you have a bunch of healthy accounts that you're paying on time merely to drive your credit score up and you have a collection drop in the middle of that, It goes down, down, down. And so anything you have pop up that unexpectedly is going to affect either strategy negatively. So, no, I would clear everything and count on 6 to 12 months after date of last activity. You should see a credit score disappear, become undeterminable, and you can go to Churchill Mortgage and get the same mortgage that someone with an 850 score can get.

1:08:40Dave Ramsey:Same exact mortgage. But they do manual underwriting in order to make that happen.

1:08:46Ken Coleman:I just want to point this out because we take this call all the time. You need to be aware that everybody you know is probably going to disagree with what Dave just said because they're uninformed. They think that you almost heard Dave wrong is my guess because this is such a cultural thing. So I'm only bringing this up to say, call Xander and talk to them. You mean Churchill. Excuse me, Churchill. Thank you. call Churchill Mortgage and walk through it so that you actually have real data. Because most people that you do life with will think that either A, we're crazy, or B, that you heard us wrong.

1:09:22Ken Coleman:That's how systemic this credit score belief is. So I just want to point that out, that when you get off this call, you might be on the high of, okay, I know what to do. And then you tell anybody, they're going to look at you like you got horns growing out your head.

1:09:36Dave Ramsey:Tyler's in Atlanta. Hi, Tyler. How are you?

1:09:39Ken Coleman:I'm doing good. How are you doing, Dave?

1:09:41Dave Ramsey:Better than I deserve. How can I help?

1:09:43Ken Coleman:Yeah, so right now I currently travel for work. I'm a fiber optic splicer, and I make about$130 ,000 a year. And my wife, we have one little boy, and we have a little girl on the way. And I was wanting to try to move back home, and my pay will probably be getting cut in half almost. and she's a stay-at-home mom. And I was just going to see what y 'all thought on that. What's the driving reason that you are even considering taking a half pay cut to move back home? Being home. Being home with the kids. I know, but I want a little bit more on that. I know. What's the driving reason that would make you consider that?

1:10:27Ken Coleman:Well, I'm gone for five days a week, and then once a month I have to work the weekend shift. and I just want to be home with them more, be more present, and that's it. Okay, so it's not trying to be near family to make up for the travel. It's I just don't want to be on the road. Yeah, pretty much. I just want to be with them more. Is that your only option to take a 50 % cut? Probably not 50%. It might go from like 130 to like 70 or 80 probably. Doing what? I'm a fiber optics plopter. So you do the same thing? Yes, sir, yeah.

1:11:06Dave Ramsey:And where did you get that number, 70 or 80?

1:11:11Ken Coleman:Well, I've just been looking at my jobs in the area I live in, and that's about the median for that.

1:11:20Dave Ramsey:Published jobs or friends telling you about stuff?

1:11:24Ken Coleman:Published jobs, yes, sir. Okay, so that's the median. So what does a path look like for growth? Forget this move for just a second. If you stay in your industry, what is possible for you to get to over time if you look in the next three to five to seven, ten years? I mean, it's growing pretty good. If I move my way up, say I go to supervisor or something like that, I could probably reach back over$100 ,000 a year while at home. Okay. What's beyond supervisor? Probably like regional and stuff or like director. Okay. What's that make?

1:12:02Ken Coleman:I'd probably say well over 120. Okay.

1:12:06Dave Ramsey:Is that something you want? Why are you not eligible for that now?

1:12:10Ken Coleman:Well, I'm 22 right now, and I've been doing this almost four years, which I don't know if I am or not. I haven't really looked at that yet. But I'm just guessing I'm probably just too new to it, and I don't really have any supervisor experience. Can I give you some older brother advice? Actually, I'm old enough to be your dad, sadly. I just realized that. So here's what I think. I think you're allowing the real raw emotion of being away from the family, how bad your heart's hurting. And that's because you're a good dude. You're a good dude and a good dad. And I totally get it. But I think you're allowing that raw emotion to get in the way of a long-term plan.

1:12:50Ken Coleman:And at 22 with another one on the way, I would be thinking about the next five to seven years as clearly as I could. Understanding I can't control the future, but I can look forward and I can go, how do I want to take care of my wife and these two little ones five to seven years from now? And if it were me, I would let this sit a little bit, get some more wisdom besides Dave and I, some older guys in your life. Say, hey, I'm dealing with this real emotion. Because I think until you have a plan for what the next three, five, seven years could look like in your industry, I would not leave this job.

1:13:27Ken Coleman:and I would let my heart hurt a little bit more because the babies are little. One baby at home, another one at home. They don't even know. You'd be present when you're home. I would not make this move right now unless I could clearly tie it to a better move long-term. When I came to Ramsey, I actually went backwards a little bit for about a year and a half. But I knew coming here was the best long-term play. but it was a part of the long term and let me also point out i was able to do it we made some

1:14:03Dave Ramsey:changes financially to where we weren't scraping yeah let me add one other thing okay do not just because you saw some job listings at one price don't accept that as your destiny right so you You know, I don't think that you have to make less coming off the road. I think you can make almost what you're making now, but you're probably going to poke around a little bit more to find that one because you are in a wonderful trade right now, and the trades are very short on help. And I think you're probably in a stronger position than you feel like you are. You do not have to take a pay cut necessarily to come home.

1:14:44Dave Ramsey:It's not mandatory.

1:14:54We'll be right back. Thank you.

1:15:25Dave Ramsey:has kicked you off track. Well, here's how you reset. YReFi works with borrowers and other lenders that other lenders won't. They'll help you refinance defaulted private student loans with a low fixed rate so you can get back on the plan and move forward. Visit YReFi.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. Might not be in all states.

1:15:48Ken Coleman:Today's question comes from Adrian in Romania. I've been wrestling with whether certain ways of making money are morally right from a Christian perspective. I understand working for a salary, creating a useful product or service, or renting housing at a fair price, but I feel conflicted about things like stocks and bank deposits because they seem more indirect and harder to evaluate ethically. For example, when you buy and later sell stock for a profit, it can feel like you're benefiting without really creating value. And with banks, you do not always know how your money is being used. Am I overthinking this, or are some forms of investing more consistent with Christian convictions than others?

1:16:29Ken Coleman:Yeah, I do think you're overthinking it, but I don't take a shot at you there. I think, you know, you've got a great heart. I think you've got to use God-given common sense and also that still small voice of discernment. And I think that when it comes to just your general investing in banks, you don't need to feel guilty about making money on your deposits or making money on your money market or making money on your investment strategy, certainly what we teach here at Ramsey. So I think while you're overthinking it, I appreciate where your heart is. And I think you just have to back off to, wait a second, am I in any way making money through some type of Ponzi scheme, right?

1:17:07Ken Coleman:Now that is dishonesty. That is lying. And making money off of evil actions would be your meter. And so outside of that, I think you're overthinking it.

1:17:18Dave Ramsey:Am I bringing harm to someone? Yeah, that's the other thing. Right. And so when you deposit money in a bank and they pay you interest, you're not bringing harm to someone. You can't control what the bank does. It's the same thing as if you go and buy groceries at a grocery store. They now have your money. If they go and do something evil with it, you bought groceries. You didn't do anything. They did. And so same thing with a bank. If you put a deposit in a bank and they do something evil with it. Now, if a bank is known for screwing people and you put your money in there, well, yeah, you're kind of participating then.

1:17:54Dave Ramsey:But just, you know, if a grocery store is known for screwing people and you do business with them, you're participating too. Same thing, right? And so, you know, the trick is we try not to do business with people that have evil intent in any way because they're going to do that. And that is consistent. Now, and here's another interesting one that comes up also in this thing. It's stocks. you know, buying stock. Now, I don't want to, I've heard people say from a Christian perspective that I don't want to buy stock in X company because X company might be doing something wrong. Well, if you buy stock from that company, unless it's an initial public offering or unless it's treasury stock being sold, both of which are very unusual, but if you simply call your broker up and say, I want to buy stock in Home Depot.

1:18:47Dave Ramsey:Home Depot doesn't get the money. You're not buying the stock from Home Depot. You're buying it from Ken who's selling his Home Depot stock. It's an individual to an individual. It's like my, it's like my buddy has a Chevy pickup up for sale and you go buy the Chevy pickup. Chevy doesn't get any of the money. okay that it but you know but if so if chevy if chevrolet is screwing somebody somewhere or messing somebody over you buying that chevy pickup from another individual is not in any way funding the evil practices now you are driving around a brand that you don't agree with okay but aside from that there you know it's a used car the in the new car dealer does not get any The new car manufacturer does not gain.

1:19:38Dave Ramsey:This is a used share of stock. They don't get any benefit from it at all. Now, if the stock goes up in value and that benefit, because that company is doing evil things and screwing people, then you have benefited. But the actual purchase of the stock is from another individual. And so there's nothing there. And that's the thing. So you have to be real careful about jot and tittle here. the details in other words you have to be careful about uh how far down in the weeds am i going to try to do this and so you know it's um there's almost no way that you can have any transactions in the marketplace that at some point you can't lead it back to something that you don't like somewhere somehow yeah but you're what where you have to decide is okay how much what control do I have and is my intent to profit off of this.

1:20:38Dave Ramsey:So for instance, I would never buy or do business with or put money in any way anywhere near a payday lender. They're charging 800 % and they're screwing poor people. Okay. So I'm not, I don't want to own one of those secretly on the side that none of you know about, but God would know about it. Right. And so as a Christian, I'd be screwing poor people. And so I'm not going to have anything to do with a payday lender in any stretch, any way. And, but, you know, just because the grocery store, they don't get a pass either because, you know, they sell whatever that I don't agree with in there, you know?

1:21:19Dave Ramsey:And, you know, you could say, well, there's some kind of toxic, you know, it's just you can never get to the end of this if you spend all your time on this. You drive yourself crazy. So I spend a reasonable amount of time saying this is God's money am I doing something that makes him blush? If it does, then I don't do it. But I'm also not going to spend my entire life trying to live in a cave, click lint, and avoid doing business out here in a positive way, helping people in the process, and not enjoying the whole process. So there you go. Interesting. All right, Jamie is in Memphis. Hi, Jamie.

1:21:56Dave Ramsey:How are you? I'm doing well. How about you, Dave? Better than I deserve. What's up?

1:22:00Ken Coleman:So my question is, how do you enjoy financial peace when the majority of your net worth is money that you receive through inheritance and wasn't through your own hard work?

1:22:17Dave Ramsey:Do you have children? No, I'm single. Okay. Will you have children someday?

1:22:25Ken Coleman:Most likely not, no sir.

1:22:26Dave Ramsey:Okay, all right. Well, I want good things for my kids. Most people do. And so someone wanted good things for Jamie, and they blessed you with an inheritance. Was it your parents, your grandparents, or what? Grandparents. Grandparents? Okay. Didn't they deeply love you? They did. Okay. And so they wanted to do nice things for their grandkid who they love. I don't know why you couldn't enjoy that. You didn't do anything wrong except have grandparents that loved you. Right? Yeah. So I wouldn't be wasteful. I would be trying to multiply the money and do good things with it to make grandpa proud. so he's watching from heaven and say yeah i want him smiling i want to live out the legacy that he built and do good things do positive things with the wealth and and part of that is enjoy it part of it's multiply it invest it well yeah i would just add i don't there's a lot going on we don't

1:23:39Ken Coleman:have time to dig in uh i i think a practical answer is how do you start to enjoy money that you didn't earn is a little bit at a time. I think it's like being afraid of riding a bike. If I could take you way back there, you wanted to ride a bike. Little you was like, I think riding a bike would be amazing. I see older kids doing it, but I'm also equally terrified to try to learn to ride the bike. And I think there's something going on with you and money. So training wheels. So I do think training wheels. I think just go give. Here's what I would do. I would give some today or tomorrow. Not a huge amount, but just something that makes you uncomfortable enough.

1:24:16Ken Coleman:And it's not a crazy amount, but just give it to somebody and watch someone's reaction to you taking that money and doing something good with it. And then down the line, a day or two later, buy something again, reasonable, something that you would like to buy. Maybe it's even a hundred dollar purchase. Who cares? But I think a little bit at a time to begin to experience something positive with money. because my belief is you've not experienced much positive around money at all in your life.

1:25:15Dave Ramsey:welcome back to the Ramsey show in the fair winds credit union studio Ken Coleman Ramsey personality is my co-host today Mary is in Washington DC hi Mary how are you

1:25:28Ken Coleman:hi Dave fine thank you so much for taking my call sure what's up I'm retired with$8 ,500 monthly pension,$4 ,600 in expenses. I owe$376 ,000 on my mortgage and have$249 ,000 in my 401k and$40 ,000 liquid. Should I use my surplus to pay off my home early or keep investing? Hmm.

1:25:58Dave Ramsey:Interesting. So how much is owed on the house?

1:26:03Ken Coleman:376.

1:26:05Dave Ramsey:376. Okay.

1:26:07Ken Coleman:Yes, sir.

1:26:08Dave Ramsey:All right. And so, and you're how old?

1:26:14Ken Coleman:56.

1:26:15Dave Ramsey:56, yeah. So I do want your home paid off, okay, going into retirement. And so I don't want you to carry a mortgage. I mean, you're early retired at 56, but I'm saying going into your 60s and 70s, I want the house paid off. So we need to get there. But if we did even 10 years, that's 66 years old. That's$30 ,000 a year. That's$2 ,500 a month. You could do that and still invest. Okay. Or you could back off of that. Or you could back off the investing and be done in six years or five years. If you put$5 ,000 a month, it would be gone in five years.

1:26:57Ken Coleman:That's true. Okay. Is that what you would recommend?

1:27:02Dave Ramsey:Um, I don't like doing nothing on investing, so I would do something there. Um, but I, I'm going to put the heavier part of the excess money on the house while still doing something. So if I had 5 ,000 to play with as an example, which it sounds like you don't, sounds like you've got four to play with, right? Right, right. Okay. What about three in one? What would that do for us? That's$36 ,000 a year. It gets you out in about seven, eight years, something like that. Yeah. If you put$1 ,000 in investing, that's only$12 ,000 a year. And you put$3 ,000 on the house, you'll be done. I think I'm doing this in my head, but I'm pretty close.

1:27:48Dave Ramsey:I think it'll be between seven and eight years you'll be out. And here's the thing. Is your$250 ,000 that's in the 401K invested in good growth stock mutual funds earning market rates of return?

1:28:03Ken Coleman:um i think so i retired from the government so i have the g fund okay so it's tsp it's not 401k tsp i'm sorry it's tsp okay i would move it all into the c plan

1:28:19Dave Ramsey:not the g okay it's it's been it's been earning about what the s &p does and so it's been earning around 11, 12 % a year average, if you're earning 10%, which the G is not, but the C would be, if you're earning 10 % a year, your lump sum, your$250 that's in there, will double every seven years. You're 56, so that means that$250 will be a million dollars at$70, if you don't add anything to it, if you don't add anything to it, and if it's in the C plan. Now, if you're retired, you can roll that TSP into an IRA with a good SmartVestor Pro and pick mutual funds that will outperform the C. If you're stuck in the TSP, you know, like if you still work there, then I would be in the C plan.

1:29:15Dave Ramsey:Maybe a little bit in the I, a little bit in the S, but mainly the C if you're working there. But you're not there anymore. You can roll that. You could go on Ramsey solutions.com, click smart investor pro roll that two 50 and sit down with them and say, Hey, if I had a thousand dollars to this and it's invested in the four types of mutual funds that Ramsey talks about growth, growth and income, aggressive growth and international, which is what my personal portfolio is. and so is Ken's, okay, and we pick good mutual funds that have a better track record than the market, better than S &P averages, then, yeah, then your$250 will be a million dollars, and your $1 ,000 a month will be another chunk as well at$70 ,000, and you'd have the house paid off at$4 ,000 or$3 ,000 a month in, I think, seven and a half, you know, eight years, we'll call it, and so, But that puts you at like 65 with a paid for house and on your way to a million dollars in nest egg.

1:30:12Dave Ramsey:Meanwhile, as soon as a house gets paid off, you know, your investments will already be on track. You've got some freed up money at that point.

1:30:19Ken Coleman:Yeah. And the only thing I would add, and we didn't get into this with you, so I'm not sure if you're single, if you're married or not. But the$4 ,600, I'd be looking, where can we cut there? That feels like that's a little bit high. But I love that you've got the$8 ,500 monthly pension. That's nice. It is nice. Another thing I would also throw out there, I'm not saying you have to do this, but I would think about it. Being young like you are, got a lot of experience. How can I take some of that government skill, go to the private sector for three years, 24 months, and make some good money and fast forward the entire timeline that Dave just laid out?

1:30:54Ken Coleman:Oh, yeah. You drop a couple hundred grand on this formula, all of a sudden everything shifts quick. Because of her age, I would think about it.

1:31:01Dave Ramsey:You know, between now and 60, you could pay off the house with income only. Correct. Extra income only. Correct. Make 300 grand between 960, that'd be like$120 ,000 a year or whatever. I mean, I bet you could. It's possible. I would look at it as an option. You don't have to do it as a slave drive thing. No. Take something that kind of makes you smile. You're happy to go to work. That's right. And go make a little bit of money. And it makes me real happy because I'm paying off my house super fast. And then I can really be serious about investing. That's a really good idea. I didn't think about that.

1:31:32Dave Ramsey:because at 56, you've got a lot of gas left in the tank, a lot of things you can do. That's very cool. Okay, so the TSP has the Thrift Savings Plan for federal government employees, has several options. The G is like a guaranteed, and it's one of the lowest paying of the options. The C is a common stock, and it mirrors the S &P. The S is small company and is like an aggressive growth. The I is international, and so that's like an international growth stock mutual fund, same kind of thing. The S and the I have underperformed, though, their indexes in the marketplace, so they're not as strong. The C is by far the strongest thing, not even a close second in the TSP program.

1:32:25Dave Ramsey:And so what we've always recommended is somewhere around 80 % for those of you working there, or more in the C plan. And if you want a little bit of spice in the gumbo, you could go 80-10-10, 80 % C, 10 % S, 10 % I, and that's starting to approximate the four types of mutual funds. We talk about growth, growth and income, aggressive growth, and international in your TSP, and you'll get a good rate of return there. But I would have zero in the F or in the G, either one. and they also have new life phase plans. I wouldn't be in any of those at all. Not at all. Don't let the government plan your investing.

1:33:06Dave Ramsey:That would be a bad idea. Sorry if you work for the government, but you should know that. That's true. Yeah, no, you want to plan your investing, and you want to look at the track records of these particular indexes that these are modeled after, and they're pretty simple to look at. They've got lots of good information on their website on it. But if you're in the TSP plan, that's what we recommend, folks. And I would recommend any time you leave a company or the government that you roll to an IRA because a self-managed IRA through your broker in good mutual funds is going to outperform the limited options you had back at the old place.

1:34:21Ken Coleman:We'll see you next time. for technology, sales, marketing, writing, copy editing, and creative roles. Check out all our job postings at RamseySolutions.com slash careers. That's RamseySolutions.com slash careers.

1:35:02Dave Ramsey:Brandon is in Fort Worth. Hey, Brandon, how are you?

1:35:06Ken Coleman:Oh, it's another beautiful day in paradise for me, guys. How are you, gentlemen?

1:35:09Dave Ramsey:Just the same. How can we help, sir?

1:35:12Ken Coleman:Good. Glad to hear it. Well, my question revolves around a bit of a moral conundrum for me. I'm wondering whether or not I should give back a prorated amount of money that was a lump sum given to me by a pretty new employer based on the fact that I have pretty much nailed down a new job and whether or not I should give any of that back.

1:35:39Dave Ramsey:So that's what's going on. So you got paid a signing bonus to come with them.

1:35:44Ken Coleman:Less structured than that. But basically what happened is we, during the negotiations for this new job, we agreed on a salary amount. We walked away. The next day they called me and said that for internal company politic reasons, they didn't want to put that amount of salary on paper. So what they were going to do is put me on paper for a lower salary. And a third party, tangentially related to the business, would give me a lump sum roughly equivalent to 33 % of my annual income just up front. And those two things combined amounted to the amount that we agreed on for an annual salary.

1:36:22Dave Ramsey:How long were you there?

1:36:24Ken Coleman:I have only been working here for four months. There is not a shred of paperwork that has been wedded with ink that would legally require me to give this money back. Did you handshake and say you would? Yes, I did. Well, I didn't say I would, but I did handshake and say I would work for them, and I'm having some mixed feelings about leaving so soon. Why are you leaving so soon? Because I have – it was somewhat unexpected, but a job hiring window opened for a job that is kind of the Cadillac job in the industry in which I work. within three to five years, I would roughly triple my current income.

1:37:05Ken Coleman:And it's just too much of an improvement to my family's quality of life to say no. Sure. And you've already accepted the new role. Essentially, yes. What does essentially mean? Yes. Yes, pending a training date is what that means. So I don't know how long I'll be working at the current job.

1:37:27Dave Ramsey:How much was the lump sum? Wow.

1:37:29Ken Coleman:It was$50 ,000.

1:37:31Dave Ramsey:And what did you do with it?

1:37:34Ken Coleman:Well, we still have roughly half. My family and I are still in baby step two, so we used about half of it to clean up two car loans that we had. So now we're at debt rates except for our mortgage. But we did chew through a decent chunk of it, but I have about half, and about$12 ,500 of that is obviously earmarked for taxes. so how okay it was a part of your salary it was such a convoluted way of doing it but the bottom line is that was a part of your salary they just chose to pay you a different way they prepaid it so how much of the 50 000 uh over the course of 12 months how much would that represent it was for over how many months i've been working for the company for four months i'm sorry but was that for a year to make up the difference for one year yes yes oh okay okay that's what i'm trying to figure

1:38:25Dave Ramsey:$4 ,000 a month. Okay. $4 ,200 a month. Okay. All right. And so, and you've been there four months, so that's 16 of it. Yes. And you've got to pay taxes on this. Yes.

1:38:43Hmm.

1:38:44Dave Ramsey:But they didn't, there was no, like if we move someone from another state and we hire them, and we pay X number of dollars, call it$10 ,000 in moving expenses, our employment agreement requires they repay that if they leave within 90 days.

1:39:01Ken Coleman:Correct. And that is pretty standard in the industry. However, I signed nothing to that effect whatsoever.

1:39:09Dave Ramsey:And there was no discussion of if you leave, you've got to pay this back.

1:39:15Ken Coleman:Not particularly.

1:39:16Dave Ramsey:No, it's just you feel funny about taking the money and then not being there the whole 12 months. What was going to happen at the end of 12 months, by the way?

1:39:25Ken Coleman:Well, so one thing we did discuss was that this third party would help make up the difference.

1:39:32Dave Ramsey:Every year?

1:39:34Ken Coleman:No, not every year. So one thing that we did discuss was that they have to basically allow me to do outside work to make up that difference. So basically I had about 12 months to establish relationships. not to go to my new position.

1:39:53Dave Ramsey:No, I'm talking about if you had stayed there 12 months after 12 months, your pay goes down$50 ,000.

1:40:00Ken Coleman:Yeah, that's correct. From that primary employer. Wacky that you took the deal. Yeah, it's kind of a crazy deal. I have had a decent amount of success with side work making up that difference.

1:40:13Dave Ramsey:Yeah, but that's irrelevant to this. This is like, you know, we don't want to tell the other people that work here, so we're not going to put it on paper. This just got this got a bad smell over the whole thing.

1:40:24Ken Coleman:Yeah, it's pretty it's pretty weird. I make no bones about that.

1:40:29Dave Ramsey:Not on you, but on them. It's just strange. And a third party has to come to the table. This is very strange.

1:40:36Ken Coleman:The third party was like a relative. Yeah.

1:40:39Dave Ramsey:Yeah. Now, I – okay, the best way to answer a business ethics question is what would you want someone to do if the roles were reversed? Treat other people like you want to be treated. And so just switch roles and try to put yourself in their shoes and say, all right, I hired this guy. I gave him 50 grand. He worked here four months, and he took off for a better job. How would you want to be treated? I would probably – if I switched and tried to look at it through their weird lens, but they have a weird lens. but I'm trying to sit over there in their shoes. I think they're going to have not a moral expectation.

1:41:17Dave Ramsey:I don't think you breached any ethics. I don't think you did anything wrong legally. If you kept the money, they learned a lesson on how not to structure deals because this was a stupid way to do this thing, especially with nothing inked on it. But I, how would you want to be treated if the roles were reversed? And that, that's the kind of person you want to be regardless of the kind of people that they are. And so, yeah, I'm going to, I'm probably, if I'm switching roles, I'm probably going to write them a check for something. And then you just decide maybe it's the 25 and you got to cover the taxes or whatever.

1:41:54Dave Ramsey:I don't know. You got, you know, you got a tax problem out of this too, this mixed in there, but I'm probably going to go, okay, I worked here four months and I got to pay taxes on all this. And there's, here's what's left out of that. And so here's what I'm going to do. And I'm not obligated to do anything, but I'm going to do this just as a, because it's the kind of person I am. I'm probably going to do something.

1:42:14Ken Coleman:Yeah. That's why I was asking that question of how is that built in so that we could come up with a number. So we've done four months service out of the 50. And that's where I was going.

1:42:23Dave Ramsey:That's 16 of the, you know, 17 ,000 of the 50s. So that's 33 left. He's got 25 in the account, but he's been taxed on 50. That's the other issue. So he's not netted out. And I don't want to pay them back my tax money. Yeah, that's right. And I owe taxes. And I'm not

1:42:40Ken Coleman:going to do it in a lump sum. I'm going to offer... So here's an idea.

1:42:43Dave Ramsey:What if you said 50 minus tax, or 4 ,200 a month minus taxes and did it that way? That feels... So what I'm trying to get to is a good formula that makes a net of taxes yeah the taxes they lost yeah because they essentially

1:42:57Ken Coleman:prepaid him is that correct that's how we're looking at that prepay on work to be done what

1:43:02Dave Ramsey:they did and you only did four months so i would feel that way too yeah i and and i don't think again i'm i wouldn't throw darts at you whatever you do because i think they're squirrely and and i think this whole thing's got a smell on it that's weird yeah and so um you know they get They get what's coming to them on that. But if I answer an ethics question, honestly, I have to get a tender heart and I have to step on the other side of the desk and I have to say, how would I want to be treated if I was sitting over there? And how would I expect to be treated? And, you know, that's the thing. So we had a guy working for us when the Internet first started, and cold fusion was the language.

1:43:45Dave Ramsey:and I spent$5 ,000 on a coal fusion class and another$4 ,000 to send him to class in Oklahoma City. And it was in the early days. That was a lot of money for us in the early days. He came home and, of course, everything's blowing up. You know, brand new internet, right? And a guy offered him$50 ,000 more a year three weeks after he got home from class to go to work over there, more than I could pay or would pay. And he said, I got to come in and tell you about this, but I can't take it because you just invested all this in me. It's why I got the job offer. And I said, yeah, you got to take it.

1:44:18Dave Ramsey:So I let him loose with nothing. And I didn't ask for anything back. But that was, you know, again, how do I want to be treated? Yeah, he handled it up front. Yeah.

1:44:39Dave Ramsey:All right, let's cut to the chase. it's easy to get discouraged about crazy house prices and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey Trusted Agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back from the first call to closing day. Find a Ramsey Trusted Agent near you at RamseySolutions.com slash agent. That's RamseySolutions.com slash agent.

1:45:24Dave Ramsey:One of the best things that you can do for your finances is have a great tax pro in your corner. They'll help advise you on the best moves to make for your situation, for your small business, or if you've had some big life changes in the past year. If you want to know who we trust, who's Ramsey trusted, go to RamseySolutions.com slash tax pro to find CPAs and enrolled agents that have been vetted by the Ramsey team. John is with us over in San Antonio. John, I see on my screen you're a baby steps millionaire. Way to go, dude. Oh, I got to give credit to you, Dave, for putting me on the pass. Well, you walked it, man.

1:46:03Dave Ramsey:I ran it or something. So what's your net worth? oh right around 1.7 million i think i just wrote a check for my house last month way to go that's fun congratulations okay so break the 1.7 down for me how much of it's your house um probably between a little bit over 400k i would think okay so you've got a 400 000 house

1:46:26Ken Coleman:okay what's the other 1.3 million uh about 1.2 is probably in 401k in retirement accounts that

1:46:33Dave Ramsey:kind of thing. I've started up a couple of those. And then a hundred and miscellaneous. Yeah.

1:46:40Ken Coleman:You know, emergency fund, six months, you know, and I keep that in cash and usually just buy like T-bills that, you know, mature within a month.

1:46:49Dave Ramsey:Yeah. How old are you? I'm 55. 55. And how much of the 1.7 million did you inherit? Zero. Okay. I inherited my parents' knowledge and love. Love it. That's good news. I love it. My mom's still alive, too. Very cool. And your worst year of income since you've been working and your best year of income since you've been working?

1:47:11Ken Coleman:Worst year? Probably 50. Best. Just a little over 200.

1:47:18Dave Ramsey:Okay. What do you do for a living? I'm a project director in medical research. Okay. Alright. Four-year degree? Yes. In what? That was in geography and child psychology. Got it. Cool. And your GPA when you were going to school? Oh, I was worried you were going to ask me that.

1:47:39Ken Coleman:I'm going to say it was close to three, but not quite over.

1:47:42Dave Ramsey:Okay. That's what mine was. Mine was a 2.97, and I'm still pissed about that three 100s. Yeah, there you go. Good for you, man. All right. So you didn't inherit anything. You start at zero. At age 55, you got$1.7 million, including a paid-for house. Very cool. So when you're out there running around today and you see these news reports that the American dream is dead, that it can't be done today, do you think this can be done today?

1:48:10Ken Coleman:Absolutely. And not only can it be done, it can be done easily. It's all mental. My dad immigrated over from Germany when he was in his 20s and accomplished the American dream. My parents instilled me that it is absolutely possible. take some sweat, and just keep your head on straight. I didn't grow up until I was 32. I just wasn't thinking clearly, and then I was. And I applied the principles they instilled in me and your baby steps that gave me the path, and it's absolutely possible. If I can do it, anybody can do it. So if you've got a 24-year-old version of you listening,

1:48:49Dave Ramsey:what would you tell them the key is to being a millionaire? 1.7 million by the time they're 55. What's the key?

1:48:55Ken Coleman:Grow up. Grow up and just get over the mental hurdle. Once you get over the mental aspect and live within your means, anybody can do it.

1:49:04Dave Ramsey:By mental aspect, you mean believe it can happen, or what do you mean?

1:49:08Ken Coleman:I mean, you know, it's not hard. You live within your means. You have all the tools there. And don't get tied up in the math. Don't get down into the minutiae. Just live within your means, build your budget, follow your baby steps, and it's done. and just don't worry about the little stuff. Keep your eyes on the big picture and you will take what you've learned. There's so much you can read out there, but again, a lot of it gets down into the breast, you know, I mean, not the breast tax, into the minutia. If you just focus on the prize and just don't buy the things that you just want, just go with what you need, and then the day will come where you're going to be giving more and your soul is going to be much more full and you're going to be happy.

1:49:59Ken Coleman:Let's talk about that. You're not going to be worried about the next bill that comes along. So I love it. You're talking about delayed gratification, right? This idea of mentally get over wanting all the stuff, keeping up with the Joneses. I think it's a great word. I want to ask you this because you're a young man, 55. You've got a$1.7 million net worth. How has paying off that house a month ago come into grips with what you're telling us today of where you're at now at only 55. What does the future look like and feel like to you? You know, it gives me options. I mean, technically, could I retire now?

1:50:35Ken Coleman:Sure. But I don't want to. But I have options now. I mean, when people call in and yell to the top of their lungs, they have freedom. It's no lie. It's no joke. It is that. You are given freedom to have much more control over your own life and what you can and can't do. And I saw it in my daughter's eyes when she looked at me and when I told her I wrote a check and just paid off the house. The proud feeling she had for me, which is in the way my mom looked at me. And, you know, they look at you like you're a winner. And you feel like you're a winner. And there's just the, you know, the world's my oyster now.

1:51:19Ken Coleman:what do I want to do I mean I enjoy my job I love doing what I do and I get paid well for it but now I can pretty much do whatever I want I love it I have a lot of just a lot of I'm trying to look before the world just so much I could see in our future and the way my kids are growing up getting on the same bandwagon and you know there's just so much

1:51:47Dave Ramsey:I can do now so much potential Amen. Amen.

1:51:50Ken Coleman:What do you drive?

1:51:52Dave Ramsey:I drive a F-150, a 2011 F-150. A 2011 F-150. What's your wife drive?

1:52:01Ken Coleman:She has a Kia Sportage. Uh-huh.

1:52:06Dave Ramsey:How old? And it's about two years old. Okay. Good. Good. Okay. So, folks, if you want to know what somebody that's worth$1.7 million drives, that's what they drive? Yeah. that that's an actual thing that's not a it's not a video it's not an mtv reality show um it's not a you know it's not divorced housewives of the moon or whatever um that's my favorite fake show title of all time and uh i was trying to think of some bizarre place but they're all taken i guess but um anyway yeah way to go john proud of you man you're living the american dream doing it right Starting from nothing, he's sitting there.

1:52:45Dave Ramsey:So let me help you guys with this. He's 55 years old. He's making$200 ,000 a year, and he's continuing to invest. If he doesn't do that, this net worth will roughly double every seven years because it's invested in 401K and good mutual funds the way we teach, and it's invested in real estate. And so that means at 62, 3.4, if he does nothing else, and that means at 69, 7 million if he does nothing else. And that means at 76, 14 million if he does nothing else, the average death age of a male. And so this guy passes away at 80 years old with a 25 or$30 million net worth. That's what this says. That's where he's going to be just with what he's done so far and he will be adding to it as he goes along and will have given away hundreds of thousands of dollars.

1:53:44Dave Ramsey:He talked about generosity along the way and changed his family tree completely permanently. And his mother, he says dad immigrated from Germany, right? He didn't say his mom. So I was going to say, he says mom's proud though. And very, very cool stuff. Very cool stuff.

1:54:05So

1:54:05Dave Ramsey:you have to quit buying crap you can't afford with money you don't have to impress people you don't really like. You need to quit playing a game for everyone else and start playing the game for you. Start playing the game for your family. When you play that game, it's a different game. When you take the blinders and put them on and say, I don't care what anybody else thinks, All I care is where we end up, and that's where John is. Very cool stuff, guys. Very few wealthy people are concerned about what other people think. That's how they became wealthy.

1:55:14Dave 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.

1:56:07Dave Ramsey:Our scripture of the day, Luke 9, 23. Then he said to them all, whoever wants to be my disciple must deny themselves and take up their cross daily and follow me. James Clear from Atomic Habits says, when you can't win by being better, you can win by being different. Ooh, there's a better idea. I like that one a lot. Don't be normal in a world where normal sucks. There you go. I like that. Michael in Dallas, what's up? How's it going, sir? Better than I deserve. How can I help?

1:56:40Ken Coleman:Hey, I owe$63 ,000 on an RV that's worth about$18 ,000 to$20 ,000.

1:56:48Dave Ramsey:How did that happen?

1:56:51Ken Coleman:Well, I'm 25, and when I was about 23, I made a dumb decision. and bought an RV and lived in it for about six months. And now I've bought a house and I have nothing to do with that RV.

1:57:07Dave Ramsey:No, I'm saying the RV actually, you bought it for how much? So when I bought it, it was$68 ,000.

1:57:17Ken Coleman:How long ago? Three years ago.

1:57:21Dave Ramsey:So in three years, it lost$52 ,000 in value.

1:57:26Ken Coleman:Yes, sir.

1:57:29Dave Ramsey:Okay, based on what calculation, what they offered you for it at the dealer, or what the actual market value is if you try to sell it to an individual?

1:57:40Ken Coleman:I've done both. I've looked at selling it on Facebook, those type of things, and nobody's willing to give over$20 ,000 in the RV dealership. The two that I've taken it to have only offered me about between$18 ,000 and$19 ,000.

1:57:58Dave Ramsey:Well, if they're willing to give you$19 ,000 for it, they're able to sell it for$27 ,000 somewhere.

1:58:05Ken Coleman:Yes, sir.

1:58:06Dave Ramsey:They're not going to give you$19 ,000 for it when nobody is giving more than$20 ,000 for that. So your first Facebook thing, that part of the test failed. But we know what wholesale is because two dealers have offered you basically the same thing.

1:58:21Ken Coleman:Yes, sir.

1:58:22Dave Ramsey:And you owe how much?

1:58:24Ken Coleman:I owe$63 ,000. There's a little bit of complications on to why I owe that much, you know, only a$5 ,000 difference. They just added some more onto my loan. We had some complications with insurance. I didn't realize I didn't have insurance for about a month, and they decided to throw on an extra$5 ,000 onto my loan.

1:58:49Dave Ramsey:For forced place insurance. Yes, sir. Have they taken that back off now that you've got a policy in place?

1:58:56Ken Coleman:Yes, sir. It's not off. I'm still going to have to pay that$5 ,000 is what they told me no matter what. For a month? Yes, sir. I don't know what calculations or how they came up with that number, but yes. What do you make a year? My wife and I, we make about$130 ,000.

1:59:19Dave Ramsey:How much money do you have in savings?

1:59:22Ken Coleman:Not very much. We're at the very bottom of the debt snowball right now. And you bought a house? Yes, sir. While you're broke? Yes, sir. We're not doing too good right now.

1:59:42Okay.

1:59:44Dave Ramsey:I don't know how to get you out of this, Michael. I mean, you'd have to borrow the$43 ,000 and just have an unsecured loan of$43 ,000. Who holds the loan on this? Alliant Credit Union. And what's the interest rate? 10%. Okay.

2:00:08Ken Coleman:time. The bad part is I'm not only paying the monthly payment, which is$722. I've also got a$100 storage fee and then$115 for insurance every month. So I'm paying about approximately $950 a month for something that I'm not using at all.

2:00:29Dave Ramsey:Yeah.

2:00:34Yeah.

2:00:40Dave Ramsey:I truly do. I'm stumped. I don't know how you get out of this other than you just pay it down or sell it. And if you have any credit left at all and you can borrow the difference or work with the credit union to sign a note for the difference, at least the bleeding would stop because you'd have no insurance and no storage fee and sell the thing for 20 grand and sign a note for 43 and um you know maybe negotiate some of that away because they got their they don't have any collateral i mean their collateral is gone and so and it's going it's going away really really fast um wow this is these numbers are just horrendous i mean there's most most things that have wheels and motors go down in value but apparently rvs are the worst of everything out

2:01:29Ken Coleman:there it was already five years old when i bought it um so it was just uh it was just all around bad so that means there's a hundred grand when it was new approximately eight years later it's worth 20

2:01:44Dave Ramsey:talk about burning money that's like lighting hundred dollar bills on fire and just standing there holding them till your hands get hot wow um yeah the only thing i know to do, I think I would stop the bleeding by selling it and signing a note for the difference if you can talk the credit union into doing that. And the way you do that is just say, hey, look, guys, I'm getting ready to hand you the keys to this thing back. Y 'all can have it. You can have your little$5 ,000 insurance charge. Force place insurance is valid, but I'm not paying it. And you guys can just sue me. Or I'll sign a note for the difference and work my way through it because I'm the idiot signed up for this trip and I'll get to take get with you, but you're going to have to help me by letting me get rid of it.

2:02:26Dave Ramsey:And whatever it brings, we'll put that on the note and I'll sign a note for the difference. And that gets rid of the insurance bill and that gets rid of the storage bill and everything else. But also you've got to start thinking more clearly on your next moves on things. Cause you went and bought a house in the middle of this and that really puts you at further risk. It's added to this mess and you bought a house by the way where you can't park your rv yeah that's right you know that you already

2:02:58Ken Coleman:owned before you bought the house it's a lot of work in your future the good news is you're young uh and you guys need to be working multiple jobs and get after this thing a long time to clean up

2:03:10Dave Ramsey:forty three thousand dollar it's like forty three thousand dollars in credit card debt how fast can you do it making 130 you can do it in a year um and you know pay it off in a year and be done with it. And then you just get to look back and go, yep, the dumbest thing I ever did in my life was that RV thing. And the good news is I don't have to do that dumb thing again. I'll have to find something new to do dumb.

2:03:32Ken Coleman:We've talked about this many, many times. Do you have a hint as to why they drop in values because they're bringing out new models all the time? What would

2:03:39Dave Ramsey:cause that? I don't think the market is large enough. I think the resale market is very limited. Aha. The number of people buying a, in this case, eight-year-old RV. That's what it is. You're right. Would be very low.

2:03:51Ken Coleman:There's no demand.

2:03:51Dave Ramsey:There's no demand. And so it's not, you know, it'd be like a 20-year-old ski boat. You know what I mean? It's really difficult to move that product. Now, I'm not talking about an expensive ski boat like a Mastercraft. I'm talking about just a, you know, a stern drive, baby. You know, your old Bryants or something like that. That thing just deteriorates and nobody wants it. they'll just spend a little bit more and go get a new one and so that's i think that's what's going on here but i good lord all of you listening that were thinking about ever buying an rv you should have just went i don't think so that's right it's just one i mean i've bought almost everything else with wheels and motors at one time or another and have done some really really dumb deals on those processes but the one i've never bought i never bought a never bought a camper never bought an rv Somehow I managed to avoid that one mistake.

2:04:43Dave Ramsey:I just can't see you hauling down 65 in a giant RV. You don't see me. People driving by going, I think that's Dave Ramsey. Driving that Winnebago. You're waving at people as they drive by. Chevy chasing it. I don't know. I'm not a snob. I just never had that one. And I never bought a trailer. I never bought a mobile home either. That's another one. Same concept on the mobile home as well. Most people are buying something new, so therefore low demand. And they just go down in value like a rock. They're just horrible. Horrible. You can't get out of them. You get stuck in them. And poor Michael's just stuck, stuck, stuck.

2:05:18Dave Ramsey:Man. Well, you are wise to be asking questions about it and to be gathering information and try to make the best decision you can. And then just roll up your sleeves and live on nothing. No eating out. No vacations until we get the RV paid off. That's an irony. No vacations until we get the RV paid off. That puts this hour 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.