You Can’t Win Without a Clear Goal

23:16But like, so this is something that Jade has used is what I've used, but it's something that simple. It doesn't cost hardly anything. And you can just so that your mom can walk up, your dad can walk up and get your stuff. And if you've got kids, you got pets, God help you, dude. Like, man, you got to have protection for your family. It's just a way of saying, I love you when you can't say it yourself anymore and go get a will. There's no reason to not have oil.

23:43Jade Warshaw:I agree. I'm so glad you said that because it's so true. I said it in the little read here, but it's true. That's the number one thing is people say, I don't have anything that's important. And if you just stop and think about the people who are important to you, that's the exercise. Think about the people who are important to you and how much you value little things, a cookbook, a piece of jewelry, that pair of shoes, like whatever it is, there are things that you value about other people, it's the little things. I can tell you, and I know you feel this, it's the little things that when you receive them, you're like, oh, I love it.

24:17Or maybe it's not stuff. Maybe it's not even a piece of jewelry. It is giving your folks, your older sister, your younger brother, let them go to your apartment and pack your things up as part of the healing process, right? And I know it sounds so morbid, but give them the grace that they don't have to go fight some faceless, nameless bureaucrat or some apartment owner or some rental house owner for an opportunity to grieve. Like, just get a will done. I don't care who you are. Get a will done, man. I agree.

24:48Jade Warshaw:All right. Yes. My son's not 16. I mean, he's 16. He's not 18. He has a long written out. Here's, you know what I mean? He gave it to me. And when he turns 18, that'll be one of the first things we do is I want you to take ownership of this. And, you know, we should have said this too. If you have children, you're tripping if you don't have a will. because that is just, if you don't have a will and you have children, the state will decide what happens with your children. My buddy John says the only reason to not have a will if you're married with kids is if you hate your spouse and kids. Man, I know that's right.

25:19That's the only reason to not have one.

25:20Jade Warshaw:Yeah, okay. So get a will. Get a pill. We've made you feel guilty. No, I'm not trying to make you feel guilty. I'm just saying like, there's just no, there's just no excuse. It's adulting, 100%. Yeah. All right, let's go to the phone lines where we have Madison in Denver, Colorado. Hey, Madison, how can we help? Hi, guys. Thank you so much for taking my call. I'm a longtime listener and big fan. Thanks for calling. What's up? So I am wondering if my husband and I are morally obligated to give his sister$5 ,000 to pay a retainer for a lawyer. Why would you be morally obligated to pay someone else's legal fees, Madison?

26:02So a little back story. She got into this relationship about two years ago, married the man despite all of our family's warnings, has a six-month-old baby with him, and he is emotionally and mentally abusive. And so she was kind of having conversations with us about wanting to leave him because of the abuse that was occurring. And, you know, in one of those heated family moments, you know, my husband said, you know, if you need money, like, we'll help you out. Like, we'll help you. We're not going to let you fall on your face. And so that was kind of the backstory of the conversation that was had.

26:37And then yesterday she came to my husband asking for$5 ,000 to pay the retainer. You know, I think initially, I think it's less about the money. We're in a good spot. We're in baby steps four or five and six. I think his family knows that we do pretty well financially. And we're kind of getting pressure from other family members about, you know, hey, you should give, you should give her the money. and I think initially I was on board for that. I didn't think that it would be$5 ,000 but also I thought that there was going to be behavior change associated with this and since she has left them I mean it's been pretty erratic spending.

27:18She got back into alcoholism a little bit and part of me just really feels in my soul that this is a bad choice.

27:26Jade Warshaw:Okay and I was going to say that and this is no gotcha by any means But when the way you laid out the question, let me know that you already didn't want to do it because no one frames up giving as a moral obligation if they already kind of know it's not a moral obligation. So when you said that, I was like, she doesn't want to give this money. She's got a good reason. I already knew that you were going to get to that. I think, you know, it's not a moral obligation for you to do this. The question is, do you want to do this? That's question one. Do you want to do this? Is this a need that you feel like you want to meet?

28:01Jade Warshaw:I think is the question that I'd ask. And there's part of this, Madison, that I wanna take them, even though they're the people that you would be helping or enabling deciding on how you wanna view this, I wanna take them out of the subject for a moment. John, tell me if I'm wrong here. When I look at, let me lay it out. When I look at this, I see people that you love and people that you love struggling, right? Right. And so, yeah, it's hard to watch people that you love struggling. So part of the question you have to ask yourself is, is it going to be harder for me to watch them struggle and go to sleep every night knowing, man, they're struggling.

28:43Jade Warshaw:Maybe I should have helped. Maybe I shouldn't help. Is that going to be more of a soul tax on you? Or is it going to be more of a soul tax to be like, I can help in some way. Let's decide what that helpful way is and put a boundary around it and be wise there. and then will I sleep better at night if I do that thing and then I'm not watching them struggle in the same way. That's kind of what I go through in my mind and I think that that could be a helpful way to think through it for you and kind of remove them and their drama from the situation for a moment. I'll add some complexity. Is that cool, Madison?

29:13Because I know this is already a simple enough issue in your home, right? To me, there's two separate issues going on here and I'd have to think through philosophy. I'd have to go down a rabbit hole and get all morose and like sit in my room with my light, like my dark lamps and think about this, like the word moral obligation. Okay. I tent my, my impulse here. So just take this as for what it is, my bias, my gut instinct here. This has nothing to do with her. And this has everything to do with, I think all of us have a moral obligation to help kids. Yeah. Okay. So my first impulse is forget this adult who's misbehaving, who we told her don't get with this guy.

29:57Cause that's clouding this whole issue. Right now you got a kid, your niece or nephew is in an abusive household and I'm coming guns a blazing for the kid. Right. And so I, I'd have to, I'd have to sit down and say, is that moral?

30:13Jade Warshaw:this uh who knows but that's separate from the money i would right i'd feel an obligation about getting involved there now the second thing that seems like it's clouding it is can i just i'm gonna be crass okay i'm just gonna say it and i might over overstate my case a little bit you don't like her right you don't like his dysfunctional family telling you what to do you don't like that suddenly you want to do something nice and now it's on you and your Her husband's the one who said, we'll help you and do whatever. So he laid it out. If this was me in my house, I would not write her one penny.

30:48I would maybe commit to paying the attorney fee directly.

30:51Jade Warshaw:Yes. So good, John. And I'm not going to borrow any money. She's not going to owe anything back. But I'm going to have some stipulations on the safety of this kid. And if I'm going to get involved that way.

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32:39Jade Warshaw:All right, let's get right back into it where we have Andy who's in Rochester, Minnesota. What's up, Andy? Oh, not too bad. How are you guys? Doing all right. How can we help today? I may have created a savings monster out of my husband. And he is just anxious that we aren't saving enough for retirement. And I feel like we are. And I feel like we're in a good spot where we can kind of pull back a little bit. Okay, let's do something that's very culturally out of step. Okay. For you and your husband, let's stop feeling for a second. And let's just look at math. Because investment's a math problem.

33:21It's a number. Yep. So when you say, I feel like we have enough, and he says, I feel like we don't have enough, you're always going to be at an impasse because you're expecting your bodies to solve a problem they weren't designed to solve. What's the math y 'all are dealing with right now? so we so over the last couple years we've paid off over 400 ,000 wow yeah so we just kept that i know it's been kind of wild is that including a mortgage no that does not include a mortgage

33:52Jade Warshaw:student loans a car girlfriend this is a very exclusive club that you're in way to go yeah so we just kept that intensity and just threw all the money we were at debt into investing because we're like we don't have kids we're you know free will in it so wow so what do you currently have in investing about one million dollars wow wow wow okay and you know now that we have two kids. You know, it would be great not to live off of like$3 ,200 a month and just have a little more to live off of. What's your combined take-home income? About$180 ,000. Okay. And how old are you guys? So I'm 32 and my husband is 42.

34:43Jade Warshaw:Oh my gosh. And he's concerned that you're not going to have enough money for retirement. How How much does he think that you need for retirement? Does he have a number in his mind or is it an ever-moving goalpost? It seems to be an ever-moving goalpost. He's like, I want to create generational wealth for our kids. I don't want our kids to ever worry about having to care for us. Well, if he keeps on this pace, he's not going to have to worry about that because they're not going to know him. And they're not going to feel an obligation to care for him. and if he has a goal he can honor you both by making it a clear goal i want to have 33 million dollars i want to have 25 million dollars i want to have 15 right he can say what he wants in in a in a complete way do you know what i mean versus it being i don't know when we'll get there but right we got to get there because it because he's chasing a feeling i want to say something and I want Jade to push back if I'm wrong, okay?

35:45Are you ready for this, Andy? Jade, I have a struggle, and this is a personal struggle, because I've made this mistake, I think is a mistake in my own house. When I'm married, we have goals for what we want our life to look like now and down the road. Right. I don't get to have my own investing goal that I drag my wife behind the back of my truck with, right? and vice versa. She can't have, I have a goal to spend this much money every month regardless of what's down the...

36:21Jade Warshaw:Yeah, you got to meet in the middle somewhere. There you go. At some point. So Andy, he has a goal for what he wants the future to look like, which is an imaginary goal, right? It's based on a gut feeling. And y 'all have to sit down and create where y 'all want to be, right? Because if he has a goal of generational wealth and you have a goal of relational wealth, You want your kids to have these wild, fun memories with the two of you. When they think of their dad and they're off at college, they want to smile real big and they can't wait to come home and hug his neck. Those things are going to be incompatible at some point.

36:54So we have to say, what is that going to look like in the present tense and in the future? You know what I'm saying?

37:00Jade Warshaw:Yeah. So let's put some numbers around this in a way that I think you can bring this to him and make sense and know that you've done your homework. Okay. So I hear what you're saying and I agree with you. I think at this point with the money that you've earned, with the debt you've paid off and the wealth that you've built. Yeah, I think that there might be some pulling off of the gas pedal that you can do. that being said let's pretend you did it the ramsey way and you only invested 15 i don't know it sounds like maybe you're investing more than 15 is that true yeah we're probably closer to 40 40 okay and that's that's that's outrageous so let me just let's bring this to your husband what's your husband's name andy's his name's andy too yeah we're andy squares oh your house is awesome.

37:50Jade Warshaw:Now, wait one second. Okay. Andes, you already have a million dollars in retirement. Let's pretend that you just continue to contribute 15%, right? So around$2 ,200 a month, maybe you did$3 ,000 a month. And you're only in your 30s, 30 and 32, I think I heard you say. So let's say at the age of retirement, let's say you let this grow until age 60, 62. Do you understand that that's$33 million? I know I have ran the numbers, but I feel like he needs to hear from someone other than me. Have you shown it to him on it? Have you shown him? I have. And then when you say, okay, here's the math. How much money do you think, based on your math, do we need to retire comfortably and build generational wealth?

38:38Jade Warshaw:Challenge him on that level based on your math, not your feelings. Show me the math that you believe the numbers that we need so that we can understand this on a numerical level, not just a feelings level. Because you disagree on feelings. You feel one way, he feels another way. But we can all agree on math because math doesn't lie, right? Yeah. So that's what I would do. And then I would kind of be a little strong on, I believe that$33 million is enough. That's pretty generational. I think that's pretty generational. And if you want to build it out further and say, you know, if at this age, this is assuming we don't make any more money, you can go more into the depths if you want to.

39:13But I also think there's something else here, Andy. it's tell me if I'm reading between the lines here okay and I'm happy to be wrong there's also a part of this you miss your husband yeah I mean it I mean he works so hard and we do have a lot of fun and you know his job allows us to travel the country but it's like those are work trips those are work trips well we actually

39:39Jade Warshaw:go with him his work pays for us to go with but he's working it's not a family vacation so what What I'm saying is at some point you need to sit down and say, I feel like an accessory to the life that you want to live. We get to go along on the trips and while you're working, me and the kids are, we're forming like parallel lives. You know what I'm saying? Yeah. And that's the conversation beneath the dollar amount. I miss you. I want to build something with you. I don't want to be along for the ride of whatever it is you're building and doing. Yeah. and by the way we're not we're talking 30 million dollars if that's not enough then i mean we'll give up today and none of this is hear me say it i none of this is shade on him i totally get it like he wants to work hard he's scared to death he's reading the every headline in the world saying that it's all coming down i get that he's just trying to go do what he can control which is i'm gonna make as much money as i can i totally get that impulse but the conversations, A, it's a math problem and y 'all are going to be more than fine barring some wild incident.

40:43And if there is some wild incident, you know what? We'll deal with that then. But beneath that is y 'all have two kids, y 'all have a different life now, and we have to rebuild our marriage the way we want to build it. And right now, it sounds like you're living the life that he's hell-bent on creating. And that's a lonely place to live. Even if you get to go on cool trips, but you don't get to do trips together. You get what I'm saying? yeah am i right or am i off no i i think you're right i think he's just so anxious because both of his parents have literally nothing and we support we're also supporting them in their retirement and it's you know he just doesn't ever want to put our kids in that position

41:28Jade Warshaw:it hasn't taken anything away from it sounds like being able to help them hasn't taken away from your ability to invest 40 % every month. Yeah. I think you guys really, I think there is a strong difference between what's happening in reality and what it feels like. And I think you guys need to spend a lot of time looking at, John, I feel like I'm taking your content here, but looking at the facts. Just look at facts, yeah. And the definition of anxiety is I'm going to go to the future and find potential problems and drag those problems into the present and try to solve them. You can't. You can't.

42:08You all have done such an amazing job. Keep saving, keep being generous, but also live and enjoy your lives.

42:14Jade Warshaw:And feel content for once. You can never feel content if you don't have a clear picture of what success looks like.

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43:45Jade Warshaw:All right, guys, welcome back to The Ramsey Show. We're here in the Fair Ones Credit Union studio continuing to take your calls. We've got Jessica on the line from Dallas, Tejas. What's up, Jessica? Jessica, you there? Hi, can you hear me? Yeah. Yeah. Hey, Jade and John. Thanks so much for taking my call. What's up? I need your help making a decision. My husband and I are very indecisive, and so we need you all to tell us what to do. Unfortunately. We're good at telling people what to do. Well, thank you. Unfortunately, my husband lost his job last week. Oh, no. And was laid off. Yeah. Thanks to the Ramsey plan, though, we're in good shape.

44:27Okay. But we do have an upcoming trip to Hawaii coming in October. um i'm just kind of stuck i feel i'm not sure if we should go or not um understand that what what let's take we'll get to the emotional part because that's big let's be be crass and just talk math so if y 'all have no debt and you have a million dollars in cash in the bank or that was that was dumb if you have a quarter million dollars in the bank and this trip is going to cost 10 grand that's one that's one thing if y 'all are newly debt-free and but you still have your mortgage and it's going to be pretty tight that's a different thing right so where are y 'all financially so we are debt-free except for our mortgage um and i will say the trip is paid for like our flights and hotels paid for so this is basically just our spending money and boarding our dogs.

45:31So I'm thinking around$3 ,000 for those two things. Okay. I work. So I bring home around$5 ,600 a month. Okay. And my husband is actually, he's being paid through August. And then in September, he's receiving a lump sum settlement of$40 ,000 for taxes.

45:56Jade Warshaw:Okay, so he's getting$40 ,000. What other emergency funds do you have? We have$21 ,000 in the designated emergency fund, and then we have about$25 ,000 in various other sinking funds for things that we would be able to access in the case of an emergency or you know if we're really in a bind the biggest part of this is your income the 5600 a month can your household run on 5600 I mean I know it might not have all the bells and whistles but can you guys live on that without having to touch other money uh I mean if we went back to how we lived in baby step two um well that's what I mean by not all the bells and whistles.

46:45Jade Warshaw:Yeah. You could pay the mortgage, pay the, you know, keep everything running. You may not be able to take as many vacations, may not do as much shopping or eating out, right? But everything can keep going on the 5 ,600. I mean, realistically, it's around 7 ,500. But if I needed to, I could walk that, we could walk that back even more. I think you should do that regardless with a job loss. Yes. And here's why. there's the math problem part but there's also the like you you you're in a big storm and so I would it's a thing you could control when things feel like they're out of control and so just the exercise of you and him sitting down saying okay our lives have changed drastically for this season let's control one thing we can control is how much we go out and one thing we And it helps you metabolize this loss.

47:40And it's a loss. Getting laid off out of nowhere is a loss, right?

47:43Jade Warshaw:And you can't control when the next job is going to hit. That's right. He's going to get a new job. We just don't know when. And going back to the trip, especially going back to that Hawaii trip, I appreciate that the flights and everything like that are paid for. And I don't think that the trip is going to change your life if you go or if you don't go. But if you choose to go, which I think is probably okay. I would, yeah. I don't think you're going to enjoy the trip if you haven't done the math that John and I are talking about. If you don't feel good knowing, hey, we can exist on the 5600. We did it before.

48:16Jade Warshaw:We'll do it again. This is how we'll do it. We've already looked at the plan. I think if you know all of that, then you'll be able to go and you'll actually be able to relax on the beach. Yeah. And I also don't – y 'all are in the grief stage here. I, it, it's like, if you lose somebody close to you, there's that sense when it happens, I'm never going to laugh again. Like the thought of doing something fun down the road seems absurd. The truth is y 'all set yourself up. You've already paid for 90 % of this trip. You're going to have a hundred thousand dollars cash between the 40 grand that you get paid and your emergency funds and sinking funds.

48:56Y 'all are going to be okay financially. but don't make a decision right this second in that smoke, in that haze of grief on something three or four or five months away from now sure what's his prospects look like for getting another job? I mean he started looking the day that it happened he does have an interview this week already he was laid off about five or six years ago, and it did take about seven months for him to find something. And so... Okay, what was that like for y 'all? It's kind of what I'm worried about. What was that like? Forget the money part of it. What was it like in your home with a guy who's been searching for seven months?

49:43Yeah, not fun. Okay, it's exactly right. I recommend to any of my buddies who get laid off to go get a something job. Yeah. Go do something and be hustling all the time to get interviews and all that kind of stuff. And a something job will let you go, right? I'm not talking about something that's going to cage you up from eight to five. I'm talking about just go get a job, something you have to get up, you have to shave, you have to shower, you have to get up and go move, say hi to people. And it just helps you walk a little taller. And when you have those interviews, you're a different version of yourself because you're productive, you're contributing to your house, you're doing a thing.

50:21You get what I'm saying? So even if you said, I need you to go make$2 ,000 a month and we're going to keep our life exactly the way it is right now.

50:31Jade Warshaw:Yeah. Like there's a psychological benefit to him and his side of his own skin, inside of his own house, inside of his own marriage that's going to be way more important than that$2 ,000 he brings home. Right. Because then you know, hey, no matter what, I've still got this, what,$86 ,000 in the bank. I've still got savings. We're still keeping our normal lifestyle going. I'm just looking for a job. There's not, uh, yes, he's going to feel pressure, but there's not the same financial pressure riding on it every single day. And that, that does show up in interviews. And that does show up in how you, uh, you know, show up to these opportunities.

51:05Jade Warshaw:And let me tell you this. Y 'all have kids? We have one. Yeah. Okay. How old? 12. 12. Perfect. I have a vivid, vivid memory of an older man at my church who got laid off from his corporate exec job. The following week, he became the church's janitor. And he did that for a year. He was there on Wednesday nights until late. He was there on Saturdays cleaning up the building. I'm going to go do something. And then he got paid pittance. But in that year, he began to ask himself what's important, what's the math on this, what's the emotion, that just heartbreak of getting laid off. And he went and got a teaching certificate and became a teacher.

51:51And I remember seeing him at the fair to go get a teaching job. And he changed his whole life. But that, as a young person, that was instilled in me is, oh, that's what men do when you get laid off. You go do the next job, and then you might have a chance to change your career. So this is going to be a blessing for your 12-year-old to watch too.

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53:55Jade Warshaw:the truth is guys we wish we could get to every call and question here on the ramsey show but that's just not possible so if you do have a money question and want an answer for your situation go ahead and head on over to our website and use the ask ramsey tool ask ramsey is our free ai tool that's built and trained on proven Ramsey principles. So that means you'll get an answer the same way that we'd answer it right here on the show. So ask your question today at RamseySolutions.com or just click the link in the description if you're listening on podcast or YouTube. Alrighty then, Sarah's in New York, New York.

54:30Jade Warshaw:What's up, Sarah? Hi, thanks for so much. Thank you for taking my call. I have a job offer on the table that I have not accepted because they're the caveat for buying a car. So I currently make$85 ,000. When I started, we were in a commission base where we got just under$35 ,000 when we were hitting plan. The new position is a$140 ,000 base, and they're guaranteeing the salary for a year. So the first year is going to be$170 ,000. Both my cars are paid off, but neither of my cars qualify. They want a 2023 or newer. And they're giving$750 ,000 a month for the car. but I don't have enough to buy something that's not new.

55:15And I'm in Baby Step 2. Is it a – are they asking you to buy a new car because they've done some sort of matrix algorithm for reliability or is this vanity? It's a sales job. It's a sales job.

55:29Jade Warshaw:So I would need to put customers in my car. They are not offering a fleet car. So I would need to bring physicians with me places. Ah, okay. So they want you to be fancy. So my 2014 is not going to be cutting it. How long will they pay you$750 a month? That is the entire time you work there. Everybody gets that amount, whether your car is paid off or not. And it also covers maintenance and insurance and whatnot. So I did some math. I can get a payment for under$300 a month. So obviously it's low, but it's still taking out debt. Yeah. The risk is on you. Well, I have a very, I remember the heartbreaking conversation between a buddy who took an executive job that came with a car, that came with all this stuff.

56:18And when things got tight at the company, the first thing that went was car stipends. That is my worry. I mean, I have, I remember that conversation because I was like, oh, dude, you should probably not work there anymore. Or not because of just if they're going to tell you, here's what we're going to pay you, and suddenly they start taking off dollars and cents and then say, no, no, no, that was a perk. That's not a place I trust. So anyway.

56:42Jade Warshaw:So let's think through this for a second. So is it just you or your husband too? My husband as well, but we have two young kids, so he's mostly home. He's bringing in maybe 700 on the side. It's not a ton. both our kids are too young for preschool so we saved on daycare tell me about your current vehicles what do you have right now um 2014 chevy malibu 2017 hyundai sonata 2017 okay and two small cars nothing crazy uh-huh and are they paid off or you're still working to pay them off yeah fully paid off um neither of them are worth more than a couple grand they both have high mileage. Okay. So what I'd be looking for, what I'd be thinking about, um, when does this job start by the way, when do you have to, what's the timeline here?

57:33Jade Warshaw:I have, I have to accept by Friday. Um, yes, yes, yes. Let's, uh, or until October. So I do have a little bit of time and we do have a thinking fund for a card. It's about 3000 right now. Okay. I could potentially get something. I just don't know. Yeah. Here's what I'd be. Here's what I'd be noodling around with my husband to see if we want to do this. I'd be looking. You said it's got to be a 2023. Was there a mileage thing on it or just needed to be a 2023? No mileage requirements. Okay. They have like a mid like a small to midsize SUV. They want to be able to fit enough customers in the car.

58:10So it's like like they want like four seats minimum.

58:12Jade Warshaw:Four seats minimum. No two seat or no coupe. that you know yeah okay so i'd be scouring the interwebs for what that is and it can have high mileage and you can get it at a deal and over time if you wanted to and this is if you want to do this deal uh then at that point you're paying cash for something and they're paying you a stipend 750 a month you're not going into a car note i in no way would go into debt or a car note to do this because they are a i don't know who this company is but i guarantee you they have millions and millions and millions and millions of dollars. And for some strange reason, they're putting$30 ,000 of risk on you.

58:48Jade Warshaw:And that's just not okay with me. That bothers me because I'm like, you've got the money. Why are you putting the risk on little old me? Right? So I certainly would not go into debt over this, but if you're thinking, Hey, we can cashflow this. And for me to make$170 ,000 a year instead of 85 is a good deal. And everything else looks good. That would be my only caveat is let me go on auto trader or wherever I can find and let me find something from 2023 that fits the seating requirements. That's got a ton of miles on it that I can drive for a little while. That's not costing me an arm and a leg because they're out there.

59:24Jade Warshaw:And let me see price that out and see, okay, I've already got$3 ,000. Can I find anything for eight or 10? Or between now and October, between now and October. I'm even okay. If y 'all are on baby step two, if y 'all want to pause and stack cash. Yeah, I mean, we've pretty much paid off every, we have like 5 ,000 left on credit cards. Okay. We have a good chunk that we've been dropping. I'm okay if y 'all want to pause and just say, okay, from now, from August until October, can we put aside several grand a month? Can we get there? And I like, Jade's like, finding a nice used Toyota, used Lexus, like with real high miles on it, you can get a deal.

1:00:08Jade Warshaw:Yeah. I'm looking. I've seen a couple of things on here that might be possible. And have a plan that in one year that car rolls over to your husband who's driving the kids around, and you'll have saved up enough to buy yourself another nice car. Okay. I appreciate it. Thank you so much. Yeah, there's a really cool. Go on kbb.com, and you can find the 10 best-used SUVs under$10 ,000. And I think that's a really great place to start and just to get some answers on what you need. But I want to, Jade, what you said is super important. Somebody, some actuary in a back room made the case, you know what?

1:00:46Let's make them hold the note. Let's make them hold the depreciating asset. It's better for us to make them go buy their own tools and we'll just, we'll give them this much dollar amount because we don't want to deal with it. And anytime somebody says that, fine, they get to do that. But what they're saying is you deal with it.

1:01:04Jade Warshaw:and you got to look out for you because they're looking out for their best interest so you get to look out for your best interest and in this case certainly not taking on the debt my goodness gracious i do believe if you took october as the start date and two people you and your husband got in a room and just decided what must be true for us to come up with this dollar amount by here y 'all can figure that out yeah yeah whether that's we got to call aunt may to come over and watch the kids because i'm gonna up my work hours he's gonna work up his hours we're gonna just go bananas between now and October.

1:01:36We're going to go baby step two lightnings. I don't know. I'm just making something up, but like take debt off the table. Cause I think everybody on the planet would say that's a good deal. It's not that big of a deal. Plus I'm going to get a stipend. I'm not going to think about it, but man, I cannot get that experience out of my head.

1:01:53Jade Warshaw:No, I think, uh, I think what you're saying is right. And I do think that sometimes when folks are on baby step two, they get tunnel vision on being on baby step two and I can't do anything else, but pay off debt. But the truth is, if you're going through a job switch, that is a bit of a storm mode situation where we would say, hey, this is a major life changer. You're relocating, you're changing your job. That is a time that we would tell you to pause the baby steps anyway to get your life. You know what I'm saying? And so this makes sense. There are times, let me pull up another example. Obviously, when we talk about paying off debt, we're like, do the debt snowball method, right?

1:02:29Jade Warshaw:List them smallest to largest. But we also say, hey, if you can get out of your car and if you can sell your vehicle today, that might not be the smallest debt. But if you can sell it to get right side up. So there's times where you need to look at it more critically. More nuanced and creatively. And go, okay, what is it that I'm actually trying to do here? I'm trying to pay off debt. It is a good deal for her to take a job for$170 ,000 when she's currently making$85 ,000. Correct. So if that means we have to pause for a second in order to get the datgum job, that makes sense. So that's just, I don't know.

1:03:02Jade Warshaw:Sometimes I feel like we can get a little forced for the trees. What's that analogy? We start staring at the trees when it's the forest. Yeah, so there's nothing. You're not doing the wrong thing by pausing the baby steps temporarily so that you can get this car so that you can get the job. Get the job.

1:03:24Thank you.

1:04:11Jade Warshaw:Thank you. goals. Plus, early direct deposit and no monthly fees. And you get support from real people who want to help you win with money. You can even get the Ramsey Debt is Normal Be Weird debit card, which is linked to your free Fairwinds Spend Smart checking account to tell the world you think differently about money. So look, if you're working the baby steps, your bank should be helping you move toward financial freedom, not just park your cash. Go to fairwinds.org slash Ramsey to open your smart bundle and start making progress today. That's fairwinds.org slash Ramsey, insured by the NCUA.

1:04:59Jade Warshaw:Welcome back to The Ramsey Show. Let's go straight to Sharon, who's in Jacksonville, Florida. Hi, Sharon. You're on the line. Hi. Hi. I have a really interesting question. I am going through a divorce after a long time, 26 years, and I'll be walking away with having to pay the equity that's in our home of$375 ,000. Wow. And so I haven't been in, had any major debt in a long time. So I'm trying to figure out if I have a balance on the current mortgage at$90 ,000 and it has a 1.625 interest rate. Oh my gosh. What's it worth? It's worth$950. Oh, okay. But the new, so I was thinking about doing a cash out refi, but the new interest rates are 6.275.

1:05:56Jade Warshaw:Yeah. Yeah, that's the world you find yourself in. What is it about this house that you want to hang on to? I mean, I've been living in here for 15 years, and I don't think I would want to rent. Sure. Well, you wouldn't have to rent. Yeah, if you sold it for$900, you pay off your$90, and you're down to, I'm just going to do easy math, After you're down to$800, you paid the$375 ,000, and now you've got, after realtor fees, you've got$400 ,000 in cash to go do whatever you want. Right, but then if I go buy another house, then I'm going to have to buy it at these new market rates. Yes. Or you go write a check for the fanciest condo in the block, and you don't have yard maintenance or house maintenance or anything like that.

1:06:40Jade Warshaw:And I want to halt real quick before we go forward because I think that this is going to be really important to have this mindset going through this conversation. things are going to change. You're divorced now. That's a huge change. So having a changed interest rate is probably one of the smaller changes that you're going to experience, right? So I want you to approach the conversation knowing that there's a lot that's going to change. Interest rates is kind of par for the course on this. Does that make sense? Everything in your old life is over. And that's hard to metabolize, especially if you didn't ask for this divorce, if you didn't want it and it's been thrown on you, or if you did ask for it and you just wanted to keep your regular life just minus your marriage.

1:07:26Everything is different now. And I see a lot of folks want to hang on to their house because it's where they've lived forever. It's where the kids are. I want to try to keep a semblance of my old life while also dealing with this huge schism. And I guess what I wanted to tell you, Jay's trying to tell you, the life you had is over. And if part of your new life includes this house, great. We'll help you get there. But it is going to come at a significant cost. Things are going to be different. What is your take on income for a year?

1:07:58Jade Warshaw:Yeah, about$200 ,000. Excellent. After taxes, yeah. So you're doing great financially. Yeah, I can afford it. I haven't had debt in so long, well, major debt. The only debt I really have is$30 ,000 remaining on a vehicle loan. I know how y 'all love vehicle loans. But I have$30 ,000 left. I got$550 ,000 in TSP,$100 ,000 in the Roth IRA. um, 96 ,000 in an annuity and 50 ,000 cash. Wow. Great, great job. Yeah, you're doing great. I really think that, um, I think what John said is really true and take some, some moments to think about that. If you end up keeping this house, you do the cash out refi, you refinance at, you know, current rates, 15 year fixed rate.

1:08:47Jade Warshaw:Yeah. You're going to have a higher interest rate, but you're going to get to keep your house. So there's the trade-off, right? You're deciding this is worth doing that action, right? So you do that trade-off. Or your other option is, you know what? Yeah, fresh start sounds good. I'm gonna take my cash, my 375, my 400 ,000. Maybe I'll see if I can find something in cash that fits my needs. Maybe I will rent for a season, save up a little bit with it and then do something in cash. Or maybe I'll use it as a down payment on what I want, right? Those are the options. All of them are a trade-off in some form or fashion and your choice gets to truly be, which one do I want?

1:09:24Jade Warshaw:And I think that if you can frame it like I get to choose, that's kind of cool. It's not being forced on me. I think that's a good mindset to try to approach this. I've been married 24 years and I'm trying to put myself in your seat. I think the last thing I would want to do is walk back into that house. But that's just me. Everybody's different, but I would want a completely clean slate if this was happening this way. How long do you have before he needs to get the$375 ,000 payout? September 1st. So I did start the process of a cash out refi. Of course, I'm not necessarily bound to it, but it's just a lot of change.

1:10:11What basically would be a$450 ,000 mortgage at six and a quarter? Yeah, I know. That's the thing. And psychologically, just knowing that, you know, we're already down to 90 ,000. I know. And have the lowest interest rate ever. And now paying five times. I mean, that's a grief. That is something. Be sad about that.

1:10:31Jade Warshaw:100%. Yeah, Sharon, to grieve. Because that's tough to internalize. Just hearing you say it, that is something that you guys probably fought together to get to, to build that level of wealth. And then it feels like it's kind of ripped out from under you. I mean, hearing you say it makes me sad for you. But if a thing you found yourself wanting or heading towards, and this was a light at the end of the tunnel, was freedom, this financial freedom versus a$900 ,000 house, right? Then if you want to pursue freedom, then sell the house, take the$375 ,000 plus some cash you have in reserves and take out a$100 ,000 mortgage.

1:11:13Buy a$500 ,000 house and have it paid off in a year or two. Right. And it's going to be a different house and it's not going to be as big, but you can get a smaller house that's still got all the amenities on the inside for half a million dollars. And you're taking out a much smaller loan than four and a half. You know what I mean? You're 90 plus this 375 at a high interest rate. It just depends on what kind of life you want moving forward.

1:11:40Jade Warshaw:Yeah, Sharon, how old are you? 54. 54. Here's what I would do. We're talking a lot of concepts and ideas. What I would do tonight is I would go and I would look in my area and I'd say, okay, what's it cost for my needs as they are today? What do I need? What is it that I want? Write that down on paper. What do I want in a home? And then start looking and seeing what does that cost? And then it's now let's start putting some closer numbers to the math. OK, if I sell this, if I get what I want for the house after I give them the cash out, after closing, after fees, what realistically would I take home and put some real numbers around that and then think, OK, this annuity, I could probably take some of that money, take some of that ninety six thousand and add it to my down payment.

1:12:28Jade Warshaw:It's not a wonderful investment anyway, so it'd be better invested in a piece of real estate. And so you've got options here. I think if you put a little bit more due diligence to the actual numbers, I think you're going to come out with what John was saying, which is how to get to that same place of peace, financial peace, financial freedom that you had before. It's just going to look a little different. And while you're doing that math, ask yourself, like, look at a blank sheet of paper and ask yourself, what kind of life do I want to have now? Probably the most common conversation I have with folks who are going through divorce or just on the other side of divorce is parsing through, like I said earlier, like, I'm trying to hang on to the old life I had, drive the same cars, live in the same neighborhood.

1:13:18and there's something powerful about exhaling and just getting real, real sad, that life is over. And now I'm in the driver's seat of what comes next. What kind of life do I actually want to have? And that's when you ask yourself things about yard maintenance. And you may love mowing the lawn. You may love doing flowers. And so that's going to be cool. You may say, you know what? I've hated doing the lawn. And in this new life at 54, I'm basically control, alt, deleting. I don't want that. I want to do something else. And so, but it gives you space when you realize, oh, I'm trying to hang on to little shards of my old life and just saying, uh-uh.

1:13:54And in that process, if you say, here's the life I want to create now at 54 by myself, I got a killer income. I got lots of resources and margin. I've worked my butt off over the last 25 years to give myself this margin. And you say, no, I want this house. I love this house. I want my grandkids to come grow up in this house. then awesome that's going to come at a cost all like jade what you said is perfect all these decisions come with trades and instead of making the trades from a place of weakness make them from a place of this is the life i want to have and then i'm going to make trades in that direction

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1:16:11Jade Warshaw:All right, my friends, the truth is we want to hear from you guys. So go ahead and jump in the comments. If you watch the show on YouTube or on Spotify, jump in the comments and let us know what you're thinking about. What connected you to the show? What connected to you about today's show? Why can't I talk today, John? What connected with you about today's show? that's what I'm trying to say. I'm a good looking guy and it has that effect on people. What? Never mind. She's like ain't that good looking. What are you saying? No I know what you're talking about. Okay yeah get in the comments we want to hear but don't be mean.

1:16:46Jade Warshaw:I see what some of y 'all are writing in these comments. I'm not going to name any names but I know who the trolls are. Just letting you know. Okay let's go to Caleb who's in St. Louis, Missouri. What's up Caleb? Hey good morning or afternoon guys. It's a pleasure to be on the show. I'll get right to my point. I make$95 ,000 a year. I'm working 13, 14, 15, sometimes hours a day to try and get my family out of$60 ,000 of debt. That's credit cards and just poor management on my part. And my wife and I have, are about to expect our sixth child and we want to have seven total. Holy smokes. Wow. Yeah.

1:17:27Yeah. Backstory. Uh, 10 years ago, my, I was single and, uh, a guy who I knew from my church called me and said, Hey, I got this daughter. I think you guys would hit it off. And, uh, I want you guys to marry and have a bunch of kids. And 10 years later, here we are. So, uh, my question for you guys is I'm trying to knock out my debt so I can start building my, um, wealth. And my question is, can I, and my wife by the time we're, um, I'm retired. I'm 40. He's 32. Be millionaires, following your principles. I want to knock it out of the park like Albert Poulos hit one off of Brad Lidge. John will know I'm talking about that.

1:18:02Who are these people? Why you got to bring that up? Why have you to talk about that? Oh, because you're from St. Louis. I'm from St. Louis, man. Come on. I hope that felt good. Houston Astros. I remember that home run, and that ball hasn't landed yet. He hit that ball so far. Golly. It's okay to admit. Did you cry that day? Did that happen? All right, let's get to it. No, you can't be a millionaire. You've ruined it. Conversation over. I'm just kidding. I'm totally kidding.

1:18:28Jade Warshaw:Okay, so let's run it back a little bit. So just to make sure I heard you right, $95 ,000 a year is what you're making. Obviously, your wife is home with these beautiful babies, and you've got$60 ,000 in debt. Have you done the calculation? When are you going to be debt-free based on today's numbers? So I was debt-free. Uh-oh. First of this year. Oh, I'm sorry. Can you hear me, guys? Yep, first of this year. Yeah, the first year I was at 60K. I'm down now to$25 ,000 in debt. I'm hoping to knock it out by Christmas. Oh, you're already down to 25 ,000. Okay, so Christmas Day. Wow, Christmas Day, you're done.

1:19:01Jade Warshaw:I love that for you. And then how long do you think it'll take you to save up three to six months? How much is three to six months for you? Oh, no, Caleb. Get somewhere where we can hear you clearly. There you go. Now you're back. Okay, sorry, guys. I'm not moving. That's all right. Yeah, I would say it's probably going to take, after Christmas, probably about three to four months to get my six months of income saved. Okay, good. And so then from there on, I mean, you know how this goes. We start baby step four, which is you investing 15 % of your gross income. Do you guys have any money in retirement at this point?

1:19:38No.

1:19:39Jade Warshaw:No? What was it? No, we do not. Okay, so let's pretend that at, let's see, that would put you at 41? Yes. So let's pretend at age 41, you start investing, and you invest 15%. So around$1 ,100, I calculated$1 ,187 a month. And let's give that 20 years to grow. So if you were to do that with nothing currently saved, you'd have a million bucks in 20 years, if you have it invested well, the way that we teach. Okay. So that answers your question. But there's also part of this. We believe that a big part of building wealth also is in your personal residence. Are you guys buyers or renters or how do you live right now?

1:20:25We have paid off home.

1:20:27Jade Warshaw:You have a paid off home? Yes. How did that work out? Holy moly. My my my father-in-law, General C, gave us a house at our wedding. So he was like, wow, that's crazy. So you and your wife could sell that house today and all proceeds would go to you? That's correct, yes. How much is this house worth? We had it appraised. It's between$6.00 and$6.50. Okay. Yes. So that's the answer to your question, Caleb. You can be millionaires. If you keep doing what you're doing now, you're walking the baby steps. If you keep doing this and then you start investing the way you teach, the way we teach, you will have over a million dollars plus your personal residence.

1:21:10Jade Warshaw:It's going to be over a million dollars. And again, that's if nothing changes. That's at the bare minimum. The truth is you're going to go through life. You're going to earn more money at some point. Some of these kids are going to get out of the house. Maybe your wife will pick up some work. This is the worst possible scenario is you earn a million dollars at this income. So you know it's going to be above and beyond that. It's awesome. And because, Caleb, you started this fight, I'm going to finish it currently. The Astros are in first place and the Cardinals are in third place in their respective divisions.

1:21:40So just need to say that out loud.

1:21:41Jade Warshaw:Is this the baseball? This is baseball. Okay. I love it. Somebody knows what we're talking about. It's not me. Call me. Call me talking about that Brad Lidge home run. All right. Let's go to James in Atlanta, Georgia, which is, I do know this, home of the Atlanta Braves. All right. James, you're on the line. Help us out, buddy. Hey there. How are you guys? Doing good. How can we help? So my wife is going to be going to dental school in the summer of 2028. We start the application process in June of 2027. We're currently on a get out of debt journey. We started this year. I've been listening to you guys since heavily since March.

1:22:21We paid off about$18 ,000 of our$80 ,000 in debt.

1:22:25Jade Warshaw:What's that? And we want to know if we can go to dental school without taking out student loans. So the answer is maybe, but I want to frame your question up. Okay. I want to reframe it. The way you, the way you stated, this is, this is happening in this particular timeframe. And I want you to think about not, cause that's going to get you in trouble. Cause that's then it has to happen. So the cheapest public in-state tuition is manageable. and especially if you have a year or two year runway. But if you say we're going to dental school, she's going to dental school in this time, that's when people end up in for-profit schools.

1:23:07They end up in the most expensive private schools because that's all they got into or whatever. So it's first saying, if we can afford it, we're going to go in this timeframe. And that sets a fire underneath you. And yes, depending on what schools you go to, there are public schools. And I mean, they vacillate so greatly in cost. but I'd be looking for what's the most reasonably priced public school that we can get into, especially in-state. If you start going paying out-of-state tuition, man, they'll kill you on that. If you go to fancy private schools, that can get you underwater real quick.

1:23:42And if you start going into the for-profit schools, man, that can be a nightmare. So the only in-state school currently is in Augusta, Georgia, and it's$109 ,000 approximately for four years. And then in surrounding states, it ranges from$250 ,000 to$350 ,000. It's$109 ,000 for four years. It's$109 ,000 every year, or that's the total? $109 ,000 for the four years. The in-state tuition there is$27 ,000. But if you guys have, from the research I've done, it can be pretty hard to get into dental school. And most people apply to many and get accepted into few. And that's the challenge you're going to run up against.

1:24:24and y 'all just have to decide now what our principles are 25 grand 27 grand a year is

1:24:30Jade Warshaw:i think a great deal for dental school too but that means you're gonna have to live like freshman in college and you're gonna cash flow this thing and we're not gonna look at it as 109 000 over four years we're gonna look at it as 27 grand a year and what can we what can we cut what can we add you're gonna work other jobs y 'all gonna save up money between now and then Like all that's very, very doable. And I wouldn't blink twice about somebody spending 27K on dental school. That's great, man. But if you don't have it, you don't have it. And I do get your, but you described the exact trap. I've just sat with students in all sorts of medical helping professions over the years.

1:25:12They're so desperate to get in that they end up getting in a place that they just simply can't afford.

1:25:17Jade Warshaw:Yeah, that's a really good point. I think the two caveats here is I would make sure the debt is paid off first. Yes. Because that's the only way you're going to have the margin to be able to really save up the$2 ,200 or whatever it is every month to pay for this. And the other thing is, yeah, what is your job? What are you doing? Because while she's in school, she ain't working. So that means you're going to have to bring in enough money to float the boat and pay for tuition, which I think you can do. You just have to be very intentional.

1:26:03so

1:26:09Jade Warshaw:welcome back to the ramsey show here in the fair ones credit union studio continuing to take calls about your life and money, 888-825-5225 is the number to call if you want to get on the show in case you were ever wondering. We have Gabriel in Columbia, South Carolina on the line next. Hey, Gabriel. Hey, how are you guys? Doing good. How can we help? So a few months ago in April, my wife committed an act of financial infidelity against me. I knocked over a bag and spilled out a couple papers for credit cards and we had agreed no credit cards like three years earlier um and i you know asked her some questions and found out that she had taken one of those male credit card offers and taken out seven thousand dollars or used it for an amount of seven thousand dollars

1:27:10um i i'm we've moved past it no you haven't you're here yeah you you haven't you're still here in some sense we did in some sense we i haven't there you go you paid off the money but emotionally you haven't moved past what was it what did you spend it on so i'll give a little context quickly but we went through a period where we were all sick we have two kids a one-year-old three-year-old she's a stay-at-home mom and when the when we all get sick like that she just really feels a lack of family we have in the area and a lack of help and and she's she really wanted to like make money to afford to like pay for help so she signed up for this like get rich quick tiktok millionaire course where they say oh if you don't make fifteen thousand dollars by the end of the course, we'll refund you the whole cost of the course or something.

1:28:04And, you know, that was what she said to kind of justify it. Like, Oh, you know, I would, I would have been able to pay the money back no matter what. I of course thought it was a scam. I didn't trust it. So I just, as soon as I found out, I had her cancel it. But I was, I was also like, well, you know, obviously you can't do that. You can't go behind my back and do that. And it's not like I don't provide for you. I mean, we could have had a conversation about that and we, We talked about it, and she, I guess, didn't feel heard sometimes. So that's the stuff we've worked through more. We have better communication now.

1:28:38But for even more context, like when we first got married, I had no debt. And I found out a month before we got married, she had$10 ,000 in credit card debt. I just paid it off of my savings at the time. And she also had student loans, and we're almost done paying those off. But I do harbor resentment because, like, I just feel like she's brought so much of this negative financial weight into our marriage. And it was one thing when it's like, OK, first year of marriage, she agreed, no more credit cards. But then things got a little tough and she went behind my back and took these.

1:29:14Jade Warshaw:Why didn't why do you think she because it's trust on both sides, right? One is just a little like hers is more deceitful in that way. But why do you think, and I don't know if you've asked her this, but why didn't she trust you to tell her, you know, before you got married that she had$10 ,000 in debt? Why didn't she trust you to say, hey, I saw, you know, because I'm just thinking about conversations in marriage. And it's like, hey, I saw this thing on TikTok. I think we should try it. They guarantee$15 ,000, right? Why does she not trust to have those just kind of candid conversations? What do you think is going on there?

1:29:46Jade Warshaw:Because there's trust on both ends that's lacking. to be honest with you uh she didn't have a great relationship with her her mom and i think she grew up lying a lot or hiding things to it's like a survival mechanism and and we've kind of been working on that where i'm like you know i'm not your mom like you actually have to communicate clearly to me and tell me the truth about how you're feeling or or what you're thinking and what you want to do but you can't just tell me things are fine and they're not. But let me interrupt here. You're exactly right. And you have to be a partner who can hear her feelings and not say, well, that's not a big deal.

1:30:28Look what I did last time. Right. Cause that puts you in a position of, if you're not, I don't use this word flippantly. If you're not a safe place for her to unload and just sit down and say, here's what I'm feeling. Or you try to immediately go fix it instead of just sitting with her, then her nervous system is going to just go on automatic replay of her childhood. Now, I'm not saying anything she does right. Don't hear me say that. She shuts down. Do what? Yeah, she shuts down. That's right. If I get angry or something, and she just stops talking, or she'll just say whatever will make me happy, but I know it's not real.

1:31:04We'll get to the what do you do next, but I want you to hear what Jade said. Often these trust issues are because neither of you trust each other. And you learning to say things like, thank you for telling me that. And that's it. Even if you think the thing that she says is a big deal, isn't a big deal. Say, thanks for sharing that with me. Or here's a magic phrase. Tell me more about that. Instead of, I don't care about that. We're not doing that. Tell me more about that. What is it about a TikTok thing? Like, tell me about that. And then you can, after she tells you about it, you can laugh and say, that doesn't make any sense at all to me.

1:31:42I don't feel good about that. But that's different than that. That's stupid. We ain't doing that. You get what I'm saying? It's an ethos in your home that you're both welcome at the table. Right? So when it comes to rebuilding any sort of trust, the path forward is you have to give her a roadmap and say, here is how we can – like we're going to practice trust again. And I want to pull our credit report. So hopefully you've already done that. If you haven't seen this, you have done that? Yeah, we did. And we're on the baby steps together. I'm like a Dave Ramsey addict now. We're working through that.

1:32:21You know what? We hear this all the time. Some zealous husband dragging their wife through this, some program. And it might be that she feels about Dave Ramsey as you feel about a TikTok plan. Right? And it's sitting down and saying, here's the kind of world we want to create. and my child the challenge you're going to run into trying to re-establish trust is bro you are a scorekeeper and you've kept a record of every right and wrong in your marriage and you're bringing up stuff from before you got married and conversations address the elephant in the room which is i have a wife who doesn't always tell me the truth for whatever reason i have a wife who doesn't always tell me the truth and then she knew this was a big core value of ours of mine she agreed to it and she went behind my back and that shattered this trust or really probably didn't shatter it probably just brought to surface trust issues y 'all had you got to make a path for her because you're not going to feel a certain way and if if you try to say like or constant looking for i want to feel like i trust her man that's that that finish line is going to move every time say this week if and you get to make up the path and then she as a grown woman gets to decide if I want to walk that path.

1:33:31I want to see your phone. I want to see our joint checking account. I want us to have the every dollar app so we can both see every transaction. I want to freeze on both of our credit reports. So we have to, and the other person gets to keep the code. So if somebody wants to open up a credit card, then they have to go through each other. I want to close the Amazon account. You get to decide what that path is. And my hope is that you're not punitive with it, but this is a way that you are going to be able to exhale when you start to get nervous again. And she is going to say, I'm all in on this marriage.

1:34:01I had a lapse in judgment. I screwed up and I'm full tilt forward with you. Does that make sense? And then you've got to decide, brother. I'm not going to drag up. Every time we get in a fight, every time she does something, every time I get mad, I'm going to bring up stuff from five years ago, 10 years ago. Man, don't be that guy. Don't be that guy. Deal with the problem in front of you. And I think that from what it sounds like, the real issue in your home is you have a wife that you don't trust. And y 'all have to get to the root of that. Y 'all got to be able to tell each other the truth.

1:34:58Jade Warshaw:Hey, George Camel here. So you're thinking about buying or selling your home. It's exciting, but there's a lot to think about, and all those decisions can feel overwhelming. Well, here's the good news. You don't have to tackle the process alone. Ramsey's Real Estate Homebase is the place to find all of your free tools and resources for help to get prepared to buy or sell your home with confidence. You'll find calculators, start-to-finish guides, a podcast, and even an in-depth video course hosted by yours truly. What's not to love? So if you're ready to take the next steps toward your home goals, go to ramsaysolutions.com slash real estate.

1:35:30That's ramsaysolutions.com slash real estate.

1:35:44Jade Warshaw:So guys, if you're working the baby steps, just know the best and fastest way to do that is by using EveryDollar, my favorite budgeting app. And the truth is it's more than just a budgeting app. Right now it's a plan that's built right in. You hear us talk about the Ramsey plan all the time and EveryDollar is built on that Ramsey plan. So we're not just telling you how to budget. We have an opinion on how you should manage your finances and the best ways to build wealth and how to find margin. And EveryDollar is going to hip you to that game. Okay. You can track your progress. Plus you get personalized recommendations and coaching for your situation that will help you free up more money and work the plan faster than ever.

1:36:21Jade Warshaw:Trust me, it's like having one of us walking with you every day in your pocket, showing you the next right step and holding you accountable. Start every dollar for free today by downloading it in the App Store or on Google Play. All right. Kristen is in Columbus, Ohio. Hey, Kristen. Hi, thanks for taking my call, guys. For sure. How can we help? um so me and my fiance just started step two within the last month um we have a total of around 225 000 of consumer debt before a mortgage and i had actually just got a new car like a month before and then once i started the program i'm like that was a bad idea so my question is i have my vehicle yeah my vehicle i owe about 29 700 my fiance actually has a lease and he has a year left.

1:37:11And we also have his motorcycle that he owes about$13 ,500 on. And I think it's only worth about$9 ,500. So we have negative on all of them. We obviously have negative on mine since it's brand new. And his has about$7 ,000 or$8 ,000 in negative since it's a lease and we've only had it two years. So my question is, how would we go about selling them to get used ones with the negative and how would we go about that? I'm going to come out swinging here, but I'm going to tell you what I would tell my older sister if she was asking me the same question. I would tell you what I would tell my closest friends in the world, okay?

1:37:50And I only say this because I would not have a job if everyone's plans always worked out. So please don't refer to y 'all's debt and what we owe until you are legally married and you have a process, a legal process for unwinding it. the number of times I've heard dating couples or cohabitating couples or even engaged couples start paying each other's debts off and then they break up. And I know you're like, no, that would never be us. I'm just telling you over and over untangling that nightmare or people saying I paid off 20 grand of her, whatever. And then she broke up with me and there's no recourse for that.

1:38:36You get what I'm saying? And so what I would challenge you on is y 'all run this plan. Y 'all are engaged. Hopefully I got to get married soon, but y 'all run this program in parallel, dealing with your own, what you make, what your life costs, what you owe and handle it that way. And then the day he puts a ring on your finger and you won on his, now there's a legal, there's a way to legally separate this without it being a nightmare. It'll be a nightmare still, but you You get what I'm saying? Yeah, I get what you're saying, but we've had our finances combined for a while now. I know, but that's not great.

1:39:11That puts you in a very vulnerable position. Okay. So how much money do you make every year? Well, just me or combined with us combined? Just tell me about you first. Just me, about$55 ,000. $55 ,000. And if you had to take all of the debts that you have, what would they be? Oh, I just have to add them all up.

1:39:35Jade Warshaw:Well, we know his lease wouldn't be part of it and his motorcycle wouldn't be part of it. So you'd have the$29 ,000 car? We have an equity loan on our house together, too. A what? We have an equity loan on our house. Oh, boy. Whose name is the house in? It's in his, but I'm on the deed. But the mortgage is in his name? Yes. Okay, then it's his debt. You're in such a vulnerable position, Kristen. Um, oh man. Um, so let's, let's, let's keep it, let's keep it 100 right here. So the truth is all the debts really in his name, except for the$29 ,000, uh, car, which is yours. That's the truth. Those are the facts.

1:40:20I have some student loans and, um, a few credit cards. Okay. Tell me about your student loan.

1:40:26Jade Warshaw:Okay. Tell me your student loans, your credit card and your 401k loan amount. Um, my student loans, I have about 28 ,000. Okay. My 401k loan, I have about$3 ,300. Ooh, okay. Yeah, and then I have a couple small credit cards I still need to pay off. What are those? I'm about$300,$375 for one,$900 for another, and then$2 ,200 on another one. Okay, so let's, for the purpose of this exercise, because I mean, if we're sitting right now at coffee talking face-to-face, I'd tell you the exact same thing. You do not need to put a dime of your money towards this person's debt. You need to focus on paying off your debt because that is the financially fair thing to do.

1:41:14Jade Warshaw:And legally, it's the thing that serves you best in this situation. Okay. So you make$55 ,000 a year. Good on you. Let's list these debts from smallest to largest. That's what I do. I would start with the smallest one for$375 ,000. I'd make minimum payments on everything, but I'd throw all of your extra income towards that smallest debt. Doing that is called the debt snowball. That's how I paid off, you know,$460 ,000 with my husband. It definitely works. The problem that I see, the problem that I see you running into is you guys probably have some sort of split where, you know, I, you know, I don't know what it is.

1:41:51Jade Warshaw:I'm guessing you pay part of the mortgage, which makes sense because you live there. But is there something else aside from housing expenses that you're giving him money for? No, we just combine everything. We just combine our incomes go in the same bank and we just pay the bills. How much does he make? We make a total of 135, about 80. Okay, he makes about 80. So the tough part is I want to help you as best as I can, but you called a show that really has a clear point of view on this. And our clear point of view is what John stated before. I'm not going to say it again. but that's the truth. And so I can't give you advice based off something I wouldn't do myself.

1:42:32Jade Warshaw:I would be a, I would not be a congruent human human being if I did that. So I have to tell you what I would do, which is I'd separate my money and I'd say, we're not married. Our relationship isn't committed. Therefore our money doesn't have to be committed and it's no shade, but I have to protect myself to a certain degree. And I do it like that. Yeah. So how, how would I go about with my vehicle then? like with getting out of it and getting something cheaper. Yeah, so what did you say it was worth? Did I go the route of getting a personal loan? No, what did you say? Mike, I have an offer for like$2 ,500, so that puts me at$3 ,700 and negative.

1:43:09Jade Warshaw:Okay, yeah, I would do that. I would go down, if you can get a, I don't know, do you have any cash saved? No, just the emergency fund. How quickly could you get$3 ,700? How quickly could you save it? I'd say a couple months. the offer might be gone. If you wanted to, you could go. Yeah. What you could do, you could go to the credit union or you could get a loan for the difference and then you're going to need something to drive. Right. So maybe I'd get a loan for the 37 plus maybe another 5 ,000. So 8 ,700. You're nicer. I was going to say 2 ,500. Yeah. Look for the, I mean, you're looking for a beater is the point that John is making.

1:43:48Jade Warshaw:This is just something to get you from point A to B. It's temporary. Okay. So don't get hung up on the fact that you're driving a$3 ,000 car. It's just temporary. And then now you freed up your car note, right? So how much is your car note? About 513. So you freed up the 513. Of course, you're going to have to pay a little bit for the loan that you got from the credit union or for whatever. But mostly you freed up most of that cash and that's going to go towards your debt snowball, paying off these credit cards as quickly as possible. Then next you'll move on to the 401k loan. Then next you'll move on to the student loans and do those smallest to largest as well.

1:44:22Jade Warshaw:But the key is smallest to largest and you're going to work extra hours. You know, if you can pick up overtime in some way, if you can do a side hustle. Yeah, I have been. Perfect. Awesome. Most people do this in 18 months, right? That's the goal. 18 months or less. And they do that by getting very uncomfortable, doing things they've never done before, working jobs they've never worked before, selling things that they thought they loved. Right. All of these things are part of it. He's going to sell that motorcycle and take out a loan for the difference for that$4 ,000. Yeah, absolutely. And I would encourage him to do that.

1:44:57Jade Warshaw:I would start working this plan and let him see all of the progress that you're making and him go, oh, that looks good. I want to do that, too. And you have the ability to influence this person. You can't change a person, but you can influence them with your behavior. And I think you have a really good opportunity to do that.

1:45:37Jade Warshaw:Hey guys, George Camel here. You ever feel like you make good money and still have nothing to show for it? You run into Target for one thing and somehow walk out$87 later with toothpaste and emotional support candles? Just me? Okay. Well, that's the problem. Most people don't pay attention to how they spend their money, so it does whatever it wants. And that's why we created EveryDollar. It's a budgeting app that helps you create a simple plan for your money. EveryDollar's simple, it's clear, and it helps track where your money's actually going. Plus, you get daily lessons, to-dos, and reminders along the way.

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1:46:27Jade Warshaw:all righty it's time for our ramsey show question of the day brought to you by why refi listen when private student loan payments start getting away from you you can feel like you're paying for decisions you made years ago but why refi helps borrowers explore low fixed rate refinancing options and payments designed around your current situation Just visit whyrefi.com slash Ramsey, and remember, it may not be available in all states. Today's question comes from Maria in Oklahoma. Maria writes, my spouse and I are debt-free and have a fully funded emergency fund. We're saving for a down payment on our first home.

1:47:04We tithe to our local church, but the church often presents causes where they ask members to help meet the needs of others. It feels selfish not to participate in these requests when our family needs are easily met, and our savings goal could be pushed out a few weeks or months to help make a true difference in someone else's life. How do we balance wanting to help and feeling guilty when we choose not to participate?

1:47:27Jade Warshaw:Ooh, well, I mean, John, let me just say guilt and generosity, guilt and giving cannot go hand in hand. Let me, let me phrase it like that. You're supposed to give out of a cheerful heart and I don't think you can be cheerful and guilty at the same time. Let me say this in a gross way. If you feel guilty and so you give, you're actually using the person who needs your help to make you feel better. And that makes you the parasite in that exchange, right? Because it's like, I need this for me. I need to be okay. So I've got it. Yes, you're exactly right. That's a good word. And then, I mean, yeah, you can go with the scripture, like you should be not giving under compulsion and the Lord loves a cheerful giver and all that kind of stuff.

1:48:07Jade Warshaw:But the bigger part is how you feel about it. And you giving is not, I've heard Dave say this, and I'll try to say it in my own words, whether or not you gave to that one thing is not moving the needle on how God feels about you. You know what I'm saying? And I think that that's the biggest part of this because the guilt is, oh, I should, there's this expectation. I should have done this. And if I don't do this, then maybe it's that. And it's just like, hey, what if you just set aside an amount that you and your spouse agree on and say above and beyond our tithe, we have this line item on our budget and we spend it when those needs arise.

1:48:47Jade Warshaw:And if there's not a need this month, we spend it on outrageous tipping. And if it's not tipping this month, then we buy backpacks for back to school. And this is just a line item of extra giving that we plan for on our budget. We know that it's just enough that we can afford it, but it also gives us a little bit of tinge, right? Like you feel it a little bit. And this is what God has laid on our heart to do. And we feel great doing that. I think that that's the way giving is supposed to feel. It shouldn't feel like, oh, pastor says something from across the stage. Okay, like it shouldn't feel like that.

1:49:23Jade Warshaw:And then if I don't do it because this was the month we were supposed to, I don't know, take that vacation. Now I feel guilty the whole time I'm on the vacation. I just don't think that that's the intention of, I personally don't feel like that's the way it's supposed to feel. I feel like you should go, I'm happy to help. And I planned to do so. And I do think that there's some spontaneity sometimes where it's like, you know what? I wasn't planning on doing this, but it's like, this just hit, like, let's do it. I think those times come too, but guilt is not the ticket. This is a deeper conversation, probably for another time.

1:49:56But if you're tithing every month to your local church and every week they're circling back up and be like, hey, we don't have enough here.

1:50:05Jade Warshaw:Yeah. Get involved in the budget process. Do we need new instruments for everybody? Do we need new, I don't know, whatever? That could be easier said than done. But like if it comes down to a trust issue with how's my tithe being stewarded. Well, then that's another question. Then have a bigger conversation. And I'd rather see a church with fewer fog lights or whatever and more like we're going to – I want the church to create a fund that is constantly building because we have these recurring needs of our members. I love that. Let's have that so it comes up every time. But by the way, every one of us feels – has feelings.

1:50:44We feel guilty.

1:50:45Jade Warshaw:Sure. Yes. And then as adults, this is what emotional maturity is. I have this feeling and then I'm gonna go do the next right thing. And if the next right thing is me and my husband agreed on, here's our vision for our life. And by the way, an anchored family who's got an extra bedroom, I've had, I've had college students living with us all summer. Like you can do a lot of good with that too. Right. And so let's make this commitment. I have this feeling. I feel sad. I feel guilty, whatever. Now I'm gonna go do the next right thing. Right. So don't be trapped in this. I feel this way. So I have to just mindlessly respond and react, act, have an anchored set of values and have a plan that you and your husband agree on and then move forward.

1:51:24Jade Warshaw:Yep. I like that. Hopefully we helped on that one. All right. Next, we've got Holden who's in Orlando, Florida. What's up, Holden? How can we help? Hey, guys. Thank you for taking my call. So I am 27 years old, saved up about$40 ,000, just got married about two months ago combined, we make about 120 to 130. Looking into buying a multifamily home, I've been kind of set on that from a mentor kind of mentoring me in that kind of having the fear of like, do I do this if the numbers make sense and just kind of deciding what I can afford or do I kind of buy a cheap home and kind of save and continue to save and go from there.

1:52:06Jade Warshaw:Can I ask you a question? yes would you do what the mentor says even if you can't afford it just because he said to do it no okay that's all i need to know now i know we can help you all right so we you've got 40 000 saved you're newlywed and you guys combined income is 20 000 no debt have you guys bought a home for yourself yet no our combined is about 120 to 130 000 um we are living with my parents is currently rent-free. They are Christians. We are Christians. They were very welcoming. Like, you guys can come stay here for as long as you need to get on your feet, save, whatever. Obviously, there is tensions with being newly married, living in the same home as your parents.

1:52:54I bet there is. Just kind of needing space. So I'm trying to tread lightly on that and not wait too long, but not also make a bad financial decision with a home. What are you waiting for?

1:53:05Jade Warshaw:Like what's the purpose? I'm looking at two people who have awesome incomes. They've got money saved. Why in the heck are you living with your parents? I think it's just because it's free. The numbers make sense and like investing in the right property. I think that's really. Okay. Here's what I want to challenge you on. I think that you're trading one really important thing for something that's not nearly as important. You're sitting here telling me I got a newlywed wife. my wife's hot and I'm living in my parents house and I can't be a newlywed the way I want to be because I'm trading it for investment property that is far out in the future so imagine your new kitchen table I want you to set a seat for your wife I want you to set a seat for your mom and dad and I also want you to set a seat for this uh investor this mentor of yours yeah and all those other voices are speaking into this marriage that you've created with your wife.

1:54:02Yeah. I don't like people thinking of their first home as an investment property. Okay. One of the, one of the most, man, I was that guy and I was this, I'm going to move to this house and move that. And I remember one of the wisest financial minds I've ever known said, Hey, Deloney, get your wife a home, get your wife a home. And that for whatever it clicked, It's like, oh, this isn't an investment vehicle. This is a home.

1:54:29Jade Warshaw:It's our life. It's our life. And by the way, get your wife a home could be you renting a home, you renting an apartment. You guys, you've started your life together. And now this would be a totally, if you had called me and said, man, we've got$120 ,000 in debt and I only make$40 ,000. And my parents said we could live there for a few months for free. That feels a little different. I'm not going to lie. But you've got money and you've got income and now you've got a brand new wife. Go into an apartment and have your space and start out your marriage in a place where you guys can have your privacy.

1:55:01Jade Warshaw:You can have your conversations. There's room for you to argue. There's room for you to have all of the things that are part of a new marriage and enjoy that. Do you know what I'm saying? And all of that is you guys building that together. And you're so, so young that you have the time to build that together. You don't have to sacrifice. If you don't have to sacrifice to this level, man, don't do it. What do you think, what is your mentor told you're going to gain from buying a multifamily property? I think it's just like the long term, like wealth that you can build with it. And I've always had like that kind of entrepreneurial mindset.

1:55:40And I felt that this was a way that I can get into that. And I just didn't want to, you know, make a mistake on just going and buying some home. it won't be a mistake it won't be a mistake and become a relational entrepreneur build something amazing with your wife y 'all co-create something awesome y 'all get to build the marriage you want dude go build that one

1:56:17you

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1:57:08Jade Warshaw:All right, your Ramsey Show scripture and quote of the day, Romans 12, 12. Rejoice in hope. Be patient in tribulation. Be constant in prayer. Albert Einstein said, It's not that I'm so smart. It's just that I stay with problems longer. All right. I dig it. He's also pretty smart. Yeah. Let's just quote that. He's Einstein. Yeah. All right. Caleb is in Colorado Springs, Colorado. Hey, Caleb. How can we help? Hey, guys. Hey, thanks for taking my call today. You bet. What's up? So, okay. My wife and I have been married about four years. I'm 25. She's about to turn 23 here in a couple days. Anyway, we've been farming for about five years.

1:57:55I'm actually fifth generation on our family farm here. Currently living in, we're like the third family to live in this home that's been our third generation in this family. Got it. Um, so we are kind of stuck with a, uh, hard place, a hard decision to make. Um, we made the decision this year, uh, within the last couple of weeks, actually, we're going to, um, liquidate and sell our farm. Um, that's not our family farm, but it's my wife and I's farm. Um, we've, we've been at it for about five years and decided that this just isn't working. the overwhelming debt load of farming is just absolutely atrocious.

1:58:44Not something that I would really, I don't know. I'm much more interested in helping out my dad and family. His health's not been good the last year or two. And so much more interested in helping him out as I can. And so anyway, we're faced with a decision. At the end of this sale here in a few months, we're working on kind of closing things up. We're going to be left with, after we pay off all of our debt, we're going to be left with about a net 360 before taxes. But as you guys probably know, we're going to be stuck with a pretty substantial tax bill. That's probably looking at about 260 right now.

1:59:30Why is that capital gains tax? Yes, sir. Yeah. Capital gains as well as depreciation on assets. So, you know, we've got center pivots and tractors and all that stuff that'll all be all of that depreciation. We made the mistake of fully depreciating out at the very beginning, you know, just in case. And so, you know, got to pay that back. So the decision really, and this is the most basic part of the question, is I could either pay the$260 ,000 up front and walk away with$100 ,000 just free and clear cash basically for my wife and I to completely restart our lives. We just had a little boy about a year and a half ago, but to restart our completely from ground zero.

2:00:18Or the tax accountant said that we could reinvest$180 into assets that would, in my mind, be productive and my living. And then that cuts that tax bill back down to about half,$180 taxes,$180 investment. and then I guess I would have something to show for it, I guess, quote unquote. You have$100 ,000 to show for it, but you would have$0 to go start your new life with. Yeah. Well, yeah,$100 ,000 that would be, I guess the tax accountant said it would be free and clear. Do you get what I'm saying? You would have$180 ,000 tied up in potential assets, right? I mean, and you would hope you're gambling, right?

2:01:09Like you hope that pays off. But you would have$0 in cash to go start this new life with. You still find yourself, you and your wife and your baby, still find yourselves that we're taking a new path. Yep. Yeah, exactly. And, you know, if we went the$100 ,000 route, we're probably not looking at sticking around. We're probably going to move out of state to somewhere with a little bit more reasonable living costs and things like that just to stretch the dollar as well as if we're going to start over, we're basically going to say we're going to clean slate this thing completely. And if not, if we reinvest, the decision would be find some equipment that would make a living here at home on this fifth-generation farm that we're blessed and downright privileged to live in, to be honest with you.

2:02:04Yeah, but then you're tangled up in family business now. Yeah, I think that— I learned that one about two years ago. And it hasn't rained in Colorado Springs in, what, 10 years now? I mean yeah tell me about that that's for sure yeah it's a tough it's tough if you told me hey I'm gonna go for something five years ago and it it doesn't work as you thought it was gonna work and you are able to exit and someone writes you a hundred thousand dollar check yeah I don't know I'm sure your tax accountant has got it all figured out but I'm just saying from a guy who's got two kids and a wife and I'm desperately always seeking to solve for peace right

2:02:44Jade Warshaw:that's that's for me what do you think i think that you need to solve the the problem of what you're going to do next without thinking of it through that lens because otherwise it could the tail could wag the dog and you could end up doing something that maybe is not doesn't make sense in order to reinvest this money and i haven't heard you say here's what we did this farm it didn't work here's what round two is from a career standpoint is this you going to another location and farming that land? Is this you, like, what is it, what's it look like when you move away from this and make this sale?

2:03:21Jade Warshaw:What is, what's your life after that? So that would definitely pose an option, I guess. If we went somewhere else, we do, so we do own this house free and clear. It's worth about$430 ,000 at least appraisal price. It's free and clear with or without the farm. So you'll take that money. know. Yeah. And so we'll be able to take that forward as well as the hundred. Um, I don't know what the taxes would be on that house sale. Um, cause we bought it a couple of years ago. I think you have half a million dollars. Yeah. You've, you'll be fine. You'll be able to take that and load it into the next house.

2:04:00Jade Warshaw:So the question is, what are you doing for work is what I'm saying? What do you vision your envision yourself doing? And that right there is the, the million dollar question right there. Cause I've been self-employed. We went straight. Both of us went from high school into a state leadership position and then met each other and got married. So neither of us went to school. Neither of us did anything like that. Just went into my wife as a homemaker. She has a job on the side that brings home, oh, about$500 a month. But do you see my point, Caleb, is if you say, yeah, I'm going to reinvest this money into new equipment, new equipment to do what?

2:04:38Jade Warshaw:You haven't even decided what you're doing yet. So I think that that would go on the family farm and he's going to hope cousin Willie's greasing the axles when he's supposed to like, dude, I wouldn't be involved with that. If you said I want to go work full time on this family farm and they're going to pay me a hundred grand a year. And I made that number up. They're going to pay me and I want to be a farmer still, but I'm going to farm their land. Yeah, maybe. Well, I'll tell you, that is the dream. Of course, that is the dream. And that's why we started out that way. But quite frankly, the family farm can't afford.

2:05:07they can barely afford to pay the person that's well that's what I was going to say what's the difference between this farm and the farm it doesn't work brother I mean your tax accountant sounds like I mean they're probably I know they're a hundred times smarter than I am and they're probably trying to give you here's a path you can take to not do this in the short term I'd rather see you let me ask you one last question about this then because I kind of agree with you and that's kind of been my hunch is the hundred thousand it's safer but not only safer it's more peaceful Um, let me ask you this.

2:05:39So a year and a half ago, two years ago, I guess, right before my son was born, um, I had made a poor decision to go into business with some other family, um, that ended up going under and really, um, destroyed relationships. Also carried forward a bunch of debt we carried forward. I mean, it was really a painful thing. Anyway, in that, in the aftermath, I was, we were forced to make the decision to sell all but three of the cows that my wife brought into our marriage. She worked literally since middle school. Caleb, here's the thing.

2:06:19Jade Warshaw:I'm up against the clock and I've got to let you know, you said, you already said with your own mouth the solution to this problem. You said the peaceful route would be to take the$100 ,000. Let the cows ride, dude. John has said, solve for peace. Solve for peace. The peaceful route is to take the$100 ,000 and you said it out of your own mouth, which is that's how you feel when you think about it. That's what you need to do. All right, guys, thanks for hanging out with us. remember there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.