You Don’t Get Out of Debt by Accident—Choose Your Hard

28:09And if I go on a date, I want to do it up. I would have said me too, Colin, you lost me when you said you were going into debt to do it. You see what I'm saying? Yes. So that's the pullback right there. You, um, have you ever, are you a country music fan by any chance? A little bit. I dabble. Yeah. I don't know if you've ever heard of the song way down yonder on the Chattahoochee. Oh, way down yonder on the Chattahoochee. Never knew how much that muddy water meant to me. Thank you. There's a line in there that came up in my head. All right. Have you ever heard of the song, Colin? I haven't. I'm great.

28:41Doesn't matter. Here's the point. Okay. There's a lyric that came up in my mind from that great song that reminds me of you. Okay. And I don't say this in an ugly way. So forget the whole country music thing. But there's a line that says, never had a plan, just living for the minute. Never had a plan just living for the minute. I think that kind of defines you. I don't think there's some deep heaviness necessarily with you and money. I just think you're young and you want things in life. You want some finer things. You like the finer things. And I'll bet you that there's also a connection between your dad, what a good man he is, who tried to tell you about this.

29:21And I'll bet you, tell me if I'm right or wrong, that your dad's pretty darn frugal. True or false? Nowadays he is. After he made his mistakes and tried to get me to not make those mistakes. Yeah. So did he have a time in his life where he was buying lots of toys he couldn't afford? Oh, yes. Okay. So, hey. Oh, yes. So listen, here's another thing. That runs in you. So all of this is awareness. All I'm doing is kind of helping you get aware to where you go, okay, now I've got to change my list, and I think this is a fun exercise for you. If I were coaching in your house, this is what I do. I go, get out a legal pad, draw a line down the middle, and I want you to write half two on the left and want two on the right.

30:03Now, you have a very different half two list at 25 than I do at 51. I got three kids. You know, one's in college. I got two doodles. And so when my money comes in every month. I have a long half to list. Yes, that's right. But I get great satisfaction, the same satisfaction that you just mentioned to Jade, I get from providing and taking care of my responsibilities. But my half to list is where my priority is. And even now, and I make good money, all right? All right. But I still have a half to and a want to. And my want tos, Jade knows some of that list. There's some expensive toys out there that I want.

30:44But guess Guess what? They come in second. That's right. To the have tos. And I think for you to say, now, where do I want to be when I'm Ken's age? Unfortunately, I'm that old to where I can use that example. And that's 30 years from you, right? Where do you want to be? So now make your have to list with your money every month based on where you want to end up in life. You're spending all your time in the want to column, which is natural. So not beating up on you, but flip that mindset and watch the discipline come with it.

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32:55Alright, if you're wondering where all your money went in 2025, don't experience too much shame. A lot of people like you, that's pretty normal. And normal's broke. So this year can be different, right? So let's get a head start. Download Every Dollar. Builds a personalized plan for where you are with your money to help you get where you want to be with your money. And we have coaching and a personalized plan. It's like being on the air with us, except there's no time limits. Really going to help you beat debt and build wealth. And we have found that when people are answering just a few questions that they get prompted with, that you're going to find thousands of dollars in savings on average in just the first 15 minutes.

33:36And you get the same great budgeting feature. So the new EveryDollar is unbelievable. Start it for free right now on the App Store or Google Play. All right, let's go to Russell, who joins us in Colorado Springs. Russell, how can we help today? Hello, thank you. My wife and I just wanted to get some advice on whether we need to sell our home or take one of our refinancing quotes we've recently received. Okay, run us through the numbers. All right. We make about$9 ,000 monthly, but our current mortgage is$3 ,250. And then our utilities are usually$300. And then we also have a minivan that has$8 ,500 left that we've been putting$600 to every month.

34:24Okay. Minivan. And so tell me about the refi offers. Tell me about your current interest rate and what the refis are. Yep. So current interest rate is 6.25. And the best that I could get was actually a Churchill mortgage. It gave me 5.25 right now. And it would save us$320 a month. Okay. Which doesn't solve your problem per se. Yeah. You're about$1 ,000 off from where you want to be. You want to be about$2 ,250. Is there a light at the end of that tunnel? Because so far, the savings is not enough for me to be like, whoa, go do it. I'd be looking at some other things in your life that could shift to bring in a little bit more cash.

35:19Is there something there on the career front? We are active duty military, so we could move on base, which with utilities and rent would only cost$2 ,300. Okay, great. But then we'd have to sell the home, and that's what we're worried about. Well, let's walk through that for a minute. When will you be transferring anytime soon? Do you have a kind of a scheduled move, as a lot of military folks do? Yeah, in the next two years, there's a chance we can move. Well, there you go, Jade. That is good. How big of a chance that you'll move?

35:57We could stay here. We're in the space where we could stay, but we could also choose to move. It's not as big of a deal. Do you think you would choose to move or would you choose to stay? I think it depends on which house we are in. Ah, OK. So let's then go back. Before we tackle this house, go back and tell me about the other debt. You said there was a minivan. Did I hear that right? Yes. Tell me what else. Yep. And that's it. How much is it again? It is currently$8 ,500. Okay. $8 ,500. And there's no other debt besides that? No. And how much is that monthly payment? You probably already said it, but.

36:38It's only$240, but we've been paying$600. You've been paying$600. We wanted to pay it off, but I was worried about the government shutdown. That isn't going to happen now. Got it. so if you moved on base you'd save the thousand dollars and get everything right side up but if you lived in the base housing you would not want to stay there long term potentially yes yeah but I think that's the bigger worry for us is that we owe $4.62 on our house and our letter told us it'd probably be$4.50 yeah okay I think moving on base this is very black and white to me So I'm sitting there looking at if I were in your shoes, you guys get way too much house and your income is capped, right?

37:26There's no income fix on this because of your military role. And there is also a, let's call it 50-50 chance that you're going to move. If you did that, we always give advice to folks in the military. Don't become a long range landlord. For sure. So because of all of this. I'm just trying to, I want him to be right side up on that house a little bit because you said it. You owe$462 ,000 and it's worth$450 ,000? But he can't. There's no way to, unless you can find a way to solve that, I don't think that's solvable. But I'd rather take that hit and get into the, cut their expenses and get in the base housing.

38:00I just think this house was a bad idea. And I think I would go on base, reset, and get your financial house in order. You can always buy another house. But because you're in the military anyway. That's an option. I'm not saying it's. You can have a different piece of advice. I just don't know how you fix being upside down. Well, let's lay out time. So let's lay out both options. So can option number one is go ahead and sell the house, take the loss, move into base housing, save yourself$1 ,000 a month, and then you'll have freed up money to pay off the$8 ,500. Another option is can your wife work?

38:36Can your wife make$1 ,000 a month? She saves at home in homeschools. So yes. We don't really want her to. Yes. The answer to that is yes. Right. She can make$1 ,000 a month. The kids aren't in school 24 hours a day. Right. Right. That's option two. Option two is wife makes it a point to say, I'm going to try to make between$900 to$1 ,000 a month. Suddenly, there's no more squeeze on the income. You're right at the 25 % point, which is where you want to be. And then your only debt's$8 ,500. on the van. That's your only debt. And then suddenly you pay that off. You've got 600 bucks a month back in your pocket.

39:20The mortgage is in the rightful spot and you can ride that house out until it's time to move. And then when the option to move comes, if you want to move, you can, if you don't want to move, you can stay there. And hopefully by then, after those two years, you're back right side up on this house and the market has done you well. So that's option two. Neither of these are wrong nor right. They're just what you think is best. Would you agree with that, Ken? Or do you think, do you think my, do you think? I think if they're comfortable as a couple with her committing to make that kind of money, but that's not a lifestyle choice they've chosen.

39:54So now I look at that and I go, by the way, I 100 % agree that is a viable option. But I still think they have too much house. If she has to do that for you all to sneak underneath where you need to be, it's too much house. Well, yeah, it is. But at the same time. I'm getting thumbs up from the audience. That's all I'm saying. Thumbs up from the audience out there. No, only from that kid. No, from this lady right here. Oh, there's a guy right there that's frowning at me. Yeah, I think not because if it would be one thing. I don't know why you're frowning. I haven't given them a viable option here.

40:26It'd be one thing if they both worked and it was still. But they're really squeaking by. It's right there. That's my point. They're squeaking by because of the house. Yes. No, no, no. I'm saying squeaking by on the percentage. and I'm saying moving especially while upside down is a big deal so I would tend to air it towards option two that's just what I would do. I'll go with two to make you and the guy in the lobby happy but here's the deal stick to your gun. Here's why I'm saying this they're also in the military. Yeah they're going to move anyway if they were in this place long term I would have sided with the option one I just think because they're not there long term probably then I think you got to look at that but again if they decide to stay there they're going to lose on their upside down They don't have that cash.

41:08That's going to create more debt for them. Again, I'm sticking to getting out of debt. And you've got to choose your pain. Choose your heart. So there you go. Listen, I don't need to be right. No, I know. I gave him another option. I know. I want to know what he's going to choose. Well, a lot of it has to do with the wife. Yeah. I think in today's digital world where you can hop on the internet, you can sell anything, you can tutor. I mean, she's a teacher. Maybe she tutors some kids in the area. there's a lot you can do to make a thousand bucks pretty quickly i so am in agreement with yours as an option that she could make more than a thousand but you're right they might decide it's not a value for them yeah but you're right there's no question they can right side from an income if she's working you're saying it's all values i again you know me i come down to it's always a ramsey principle first but then we got to look at the practicality of the relationship so there are When in there are cases where there's multiple options to achieve the principle.

42:06So how will they pay off the upside down? Selling stuff. She's working, doing other things, but they're out of that house. That's another principle, though. But they're out of the house. That's true. That's true. So that's why I like both options. Yeah, they're both good. Call us back and tell us what you do. Yeah, either way, though, it's right. You've got to choose your heart because you're in a situation you shouldn't be in. So that's the moral of the story there. Hey, thanks for the call. I appreciate you all serving our country. You're a great American.

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44:13Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. I'm Ken Coleman, Jade Warshaw is alongside, and we've got a Michael who's joining us in Las Vegas. Michael, how can we help today? All right. So I was discussing with my wife some kind of some payments we're making and different things and kind of getting things planned out for the near future. And one of the clouds that's kind of hanging over us is the money that we owe her parents. And I a lot of it kind of came into the relationship from before I even met her. And so I was just kind of wondering how I should go about a conversation with my in-laws to try to kind of figure this out and I guess what's right for me to ask for and I guess just how to go about it all.

45:01So did she owe them money on her own before you got married? Yes. So roughly a decade ago, she started college and they pretty much just gave her a blank check and told her. I mean, I'm still kind of cloudy on the conversations that did happen and I've never been involved in any of them since. And so they basically wrote her a blank check and she and then took out some student loans in her name as well. And we're paying off the student loans. We should have that paid off by the end of the year. We're, you know, being really diligent with that. How much were they? The student loan is about$22 ,000.

45:39Okay. And how much was the blank check for? That's where, based on the ledger I've seen, it's about$46 ,000 to, I think it's about$46 ,000. Okay. And what did that money go towards? Just life? Yeah, it was living expenses, college. There were things on there like one of the most noticeable for me was Amazon fake plants for$29.95. Okay. And so just a lot of little knickknack stuff. I want to rewind to the start of your question here, because the way I heard it, you were asking us, how do I go about you? How do you go about talking to her parents about money they loaned her? I want to make sure I hear it right.

46:29Is that what I heard? Yes. Yes, that's correct. So you and your wife have talked about this, and you two or you nominated yourself as the spokesperson. Well, I want to know what's behind this. I'm going somewhere with this. Okay. We have just been making plans on getting those student loans paid off. And then after that, we're kind of making plans on what to do with that money and kind of made my wife uneasy because she wanted to really kind of tackle what she owes her parents. But then she also isn't, I mean, up to date on everything. And we've talked about it and she's agreed to have a conversation with her parents.

47:05And I think I'm kind of spearheading this. and I really just want to make sure. So the both of you are planning to sit down with the parents, and this wasn't clear to me either, so this is why the follow-up. What is the goal of you all sitting down with the parents? I'm wondering the same thing. Okay, good. I want to know, I guess, what they really expect. The money. Yeah, the money, if that's something that we're really supposed to pay them back for these$30 for plants even, you know, things like that. Wait a second. Is it not clear to you two right now that they expect her or you two because you're both together now?

47:43Is it not clear as to whether or not they expect you to pay it back? They have only told her, oh, just pay it back whenever you can kind of afford it. Okay, wait, I'm going to go. I got to go in on this. So if I go to the bank and I borrow, I don't know,$46 ,000 and I spend it on, I don't know, fake plants and some other doodads and just it adds up a little over time. I like that. If I go into the bank and say, you know what, I don't think I should pay you back because I spent this money on fake plants and whatnot. They're going to go, we don't care. You borrowed the money and we'd like it back.

48:20Right. So it's the same thing here. It doesn't matter what she spent it on. Clearly, you don't agree with the things that she spent it on. Clearly, you view it as somewhat wasteful, money that shouldn't have been borrowed. That lives over here in a separate conversation. I think it's really, really a wrong move This is why you called, so I'll just get this out of the way I think it's a bad idea for you and your wife to sit down And put that in their lap I think if I borrowed money from somebody, I gotta pay it back And I don't go down and go, now hey, how much of this do you really want back? That is so passive-aggressive, it's not good for the relationship And I will also tell you, he's a guy who's been married 28 years and I love my in-laws.

49:04Ain't no chance I'm getting involved in that conversation. That's between your wife and her parents. Yes, but Michael's conversation, the person he's really got beef with is his wife. I agree. That's the conversation. I agree. You've got to let her know, or maybe don't let her know, but you reconcile like, man, I'm struggling that I got brought in on this debt. It is for fake plans. It's just, ugh. Babe, I'm willing to pay it all back as your husband, but I've booked a tea time while you're talking to your parents. Let me know how it goes. I'm not getting involved in that. I'm really not. Other than to say, we owe this to your parents.

49:40Now, if you want to go try to read new terms, I just don't think that's a good move. Do you? No, I would not touch that with a team football. Oh, yikes. That's going to make Thanksgiving real tasty. I just, I think you two, now this would be my advice if you and your wife were in the room with us right now, I'd go, hey, don't do that. just own it and pay it back I think you're going to sleep better don't you? I think so too I think the heart like again I just said this happened before Michael was involved and he's like Cher if he could turn back time he never would have even done this and yet here it is like John would say not by his hand but in his lap he's just struggling with dealing with this and I feel for you Yeah, I do, too.

50:28It's tough. It's tough to take on debt from, you know, a spouse who's bringing it into the relationship when you don't agree with what the debt was used for. So, Michael, we I I'm only following up here because we've hit you with a lot and we're both on the same page here. Where do you think your wife is with this response that you called the show? We gave you that. Where do you think she sits with all this? I think she probably agrees with it. but I think I see the pain that this kind of causes her too so well let me reframe that the only pain your wife should feel around this is the pain of paying the money back because you got to sacrifice I don't think there needs to be I think you should come away with this going when I make this right I am in good standing as a daughter I have fulfilled my commitment to my parents there shouldn't be any pain in fact there ought to be an emotional joy to go, I did what was right.

51:26The only pain is the sacrifice we teach every day on this show anyway, which is continue to walk the baby steps out. I don't see any pain. Am I missing something? No, I think just that guilt that she has for, I mean, lack of financial education and stability. Well, we've all done dumb. Well, you've heard Dave say it a million times. We've all done dumb and stupid with money. No shame. And the best way to get rid of that guilt, Jade, give you the final word on that. You write a lot about money and emotions. I do. And matter of fact, I'm going to have Christian pick up and send you a copy of what no one tells you about money, because what I think will really help you guys, one of the ways to deal with guilt and shame is to set boundaries.

52:06And I think you both need to do that. You know, it's very easy for us to set boundaries for other people, but you both need to say, you know what, we know the information, we know what happened, it's done. We don't need to keep rehashing it. We don't need to keep bringing it up. We're paying it. And that's that on that. And set a boundary that says we don't talk we don't talk about this in that way anymore of this this thing you did this thing you did she doesn't get to do it you don't get to do it it's over we pay it we move on we're not going to keep bashing ourselves over the head with it

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54:23All right, next up is Karen in Detroit. Karen, how can we help? Hi. My daughter is getting married pretty soon. And about five years ago, her sister got married. And my husband and I offered them$20 ,000 to cover wedding expenses. And that worked out well. And we've done the same with this daughter. but she and her fiance are very frugal and they would like to just spend six or eight thousand on their wedding and have asked us if they could use the rest for other costs, you know, future house down payment or something like that. And it's great that they're frugal. We appreciate that. But we have some real concerns about not enough food, not enough seating, too small of their cutting corners so much that we feel it will be a regret.

55:27It'll be what? In the future. That they will regret it in the future. Okay. I got to jump right in here and let's lean in on this. So you and your husband feel this way. Have you brought up those concerns to them specifically? We have. And what was their response? We believe it is a waste of money to spend so much on one day. And our values are more that we just want to save money. And we're okay if it's a real minimalist day. But they do still want to have a full dinner and 150 people. Okay, so let's lean in on that one. Did you start walking through with them? How are you going to feed 150 people?

56:22We did. And what'd they say? And it's okay if we have minimalist food. Like what? Like pizza rolls? Like, what are we saying? Well, yeah. Do they have a real plan is what I'm – so I don't keep asking 100 questions. I'm getting at do they have an actual plan? And then the second question is if they do, you just don't like it. Is that true or false? They do have an actual plan. Okay. You're embarrassed by it. Well, we are. We're inviting a lot of people. We're not even sure they'll have chairs. can i just say and jade will not probably will not like this i just am thinking of past calls i am ultra conservative on wedding costs and i say this is a fabulous young couple and i say it's either a gift or it isn't and if the money is a gift when i give someone a gift all right let me just use sam as an example all right i know like i know sam loves uh shoes for If I buy Sam a pair of custom Jordans or something or other, and I give them to him, and Sam's going to be like, oh my gosh, thank you.

57:39And I go, hey, now listen, I don't actually want you to wear these outside the house. That's wild. That's too much. But my point is, yes, it's insane, but it's a true example. Yeah. If I give Sam a gift of shoes, I don't get to tell Sam how and where he wears his shoes. I'm giving him a gift. And I actually think you should honor this request and you need to get over it. And I would start bragging on them. I love the fact that their response to you was our values are this. I love that they actually have a plan. And you know what? As much as you joke about it, if they want to offer pizza bagels, step into it and tell all your friends, we want you to come honor our daughter and whatever, whatever, whatever.

58:23And son-in-law. And you know what? This is the most frugal couple. it's not your normal wedding but we're so stinking proud of them and they're going to take what they save on the wedding and they're going to put it to starting their life off and paying off debt and change the narrative because I'm going to tell you I'm preaching right now but if they feel what I think they've already felt from you and you don't change that tune there's going to be resentment around what could be the most special day of their life but it's they're special. So I'm, that's it. I'm out. That's all I got to say. I concur my friend.

58:56Wow. I 100 % agree because everybody has a picture of what a wedding should be. You gave them, you guys came up with that amount based on what you think a quote good wedding would cost is my guess. And so the hardest part is I think for the, for the, the parent and for the, the child is when you're not matching, matching up. And I think everybody's probably experienced it. Who's been married. The parent wants one thing, the bride or groom wants something else. And ultimately it's the bride or groom's wedding. Now I got a hot take. Remember this, Karen, 50 % of the wedding attendees don't even care about the wedding.

59:40It's dudes. Any dude that's going to that wedding is going because his wife wants him to be there. And we don't care if there's, they probably like the pizza rolls. You could hand out peanuts. Yeah. Guys don't care. Only people that really care about all that are women at the wedding. Guys have to have good food. What's that? Guys have to have good food, don't they? No. I mean, they'd be okay with pizza rolls and beer. Are you kidding me? This guy in the audience is shaking his head yes. No, I'm serious. Like the average guy, the average, I'm trying to, and I'm not trying to be funny. I'm actually being real.

1:00:14The average guy that you will invite to this wedding is only coming because of the social pressure to come. They would much rather send their wife and stay home and watch football. And so they're there because they have to be there. They don't want to dress up. I think most people fall into that camp. Let's be honest. Okay. See, I wasn't going to speak on behalf of women because I don't know. I assume women love the pageantry and all the things. If it's a best, you know, if it's our maid of honor or like a best friend or a sister. Okay. Yeah. A family member. but if it's just Linda from church or from work, it's like, ah, I gotta go.

1:00:48100%. I gotta get a gift. 100%. You know why? The meal makes me stay at this place I don't want to be at longer. The cake is the best part. If you have a good cake, you're fine. I don't even care. I go buy cake. If I want to buy cake, I can buy cake. People stay for the cake. I have made enough money in my life to buy cake whenever I want to. So if I want cake, I'm not staying at a wedding for cake. I'll just go to Kroger and go, hey, Stacey, I just want cake tonight. I'm just saying when you go to the wedding, the thing that you look forward to is not the ceremony. It's not that it's you're looking forward to the only thing that guys look forward to at a wedding is when they get in the car and go back.

1:01:23So the point here, Karen, I love this couple. They don't need to spend the money on it. And it's OK that they're doing something different. And it's OK that you don't understand it. It's OK that it's not the way you would spend the money. I think that that's just them expressing themselves within their values. and I like Ken's idea to just get with it and be like, this is going to be fun. It's going to be different. And I will throw out something else because I've been so, I know, I've been so whatever you can call me, plain spoken on this. If you guys want to do something for your closest of friends, then you all go rent yourself a country club room that you can afford and you do a special fancy something or other for those people.

1:02:01If you really want something that's super impressive, makes you feel good. But the bride and groom probably wouldn't like that because that's not how they get down. But Karen didn't call about them. She called about her. Right. We've established that. If the tables were turned and I'm just going to put me in Karen's spot. If I was getting money from my in-laws or my parents and they said, here's 20 ,000, we said, we're going to spend it like this. And then they came to me and said, well, then you need to come to our party over here. That's our country club folk. I'd be like, I don't want to do that.

1:02:33Karen, I'm just trying to be nice and spare your feelings. I get it. Trust me, I get it. I really do. I understand your position. But I was just trying with a little bit of levity to go, it's not as big a deal as you think. Yeah, it's really not. You know what I mean? No one's going to look down at you. Oh, I'm not worried about people looking down at us. You just don't want it to be. Well, you said you were embarrassed. That's why I chose that language. As my friend would say, she calls it budge. When something's like not up to standard, I guess like low budget, like budge. You don't want it to.

1:03:07Yeah. It's a new word. And it doesn't need to be glorious. Just enough food and enough basics. Yeah. Chairs. You're just trying to keep like basic etiquette. Like etiquette level is. Yeah. I got it. I got it. So you might read the room a little bit and ask questions instead of making statements. Maybe you say, oh, if you do that, will there be seating for everybody? or are you expecting, like, are these standing? Just ask questions and then maybe offer suggestions in the form of a question. I wonder if they had a way where you could have, like, you know, and just be very light. It's just like you're like the breeze, and you mention it and you move on.

1:03:53You don't harp on it. I just think get a nacho bar. Everybody loves that. Buffet style. Get after it.

1:04:05Thank you.

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1:05:41All right, question for you, folks. Are you staying on track with the baby steps? We'd love for you to take a quiz to check your progress. Now, this isn't to, you know, slap you on the hand, but it's a good reminder of where you are in the process, where your momentum is. And we humans, we need to track our progress. That's why Dave's baby steps have been so monumentally effective is because of the nature of the stages and staying with it. So if you take our quick quiz, you can check your progress and get a personalized plan to keep you on track or get you back on track. And it only takes just a few minutes.

1:06:16So head to RamseySolutions.com or click on the link in the show notes to complete the Get Started assessment. That's what it's called, the Get Started. If you're new to the show, this is also a great thing to do as well. Now, you're chuckling over there. We humans. We humans. That was funny? It was. Okay, good. I like that. I like the free laugh. That's great. Let's go to Jennifer in Asheville, North Carolina. Jennifer, how can we help? Hi. Well, thanks for letting me come on the show and ask this. So we just got our January insurance bill. And apparently this year, or last year, we made too much and we have lost our subsidy.

1:06:56So we are now going to be paying triple what we did the previous year. And it's going to come out to be about$29 ,000 a year. So we're not in any debt. We own our home. Everything's paid for. But that's still a lot of money to just check. We're all blessed. We're a very healthy family. So we go for our checkups and all that. And so we just, we talked about maybe like just putting$29 ,000 in an account for an emergency. But then there's always like, well, the what if, you know, something substantial happened and worrying about that. So we just kind of wanted to know, like, if there were other options out there because.

1:07:40Well, did you shop it or did it just lapse over and then this is what you were stuck with? Well, it lapsed over, but then we shopped within because we kind of wanted to stay with Blue Cross Blue Shield because I know our doctors accept that. And I'm afraid of going and getting like out of network. And whatnot. But even within like that was still the cheapest option for us, for our family of five. Yeah. Well, I will say when you are independently getting insurance, it's expensive. It is. That's just part of it. And that plus insurance right now in general is expensive. It's gone up substantially.

1:08:19so your options are to try to see what else is out there but if you've decided that blue cross blue shield is what i want because it's in our network and it has the doctors we want then there's part of that that you may have to own now let me find out uh can this fit in your budget like what does this mean for your budget that's the biggest question yeah i mean like i said we we own all our our homes and and our cars and everything um and we net about 234 between the two of us a year so yeah so you can afford it yes it's just it's i just it's just a pain in the butt we don't use it you know and i'm glad we don't use it i'm not saying i i hope we spend all that money and make it worth our while but it just i just it bothers me so bad that i feel like we're just flushing that money pretty much down the drain yeah well you're not it's it's both Right.

1:09:11Let's just say both sides of it. It our insurance system is broken. Right. Health care system is broken. So it's way too expensive. There is that. And I agree with you on that. But then there's a part of it that insurance, it's insurance. So it's there when you need it. And the right. The hope is that really that you don't really ever need it for its full value. That's the whole point. Right. And that's just kind of an acceptance thing at that point is I kind of just have to accept that until I'm at the point of wealth, where I can self-insure, I need this. And here's what I had to do. And I know that this is a big mind thing, but you have to train your mind to say, it's a blessing that I can afford to have the insurance that I want and need versus I can't believe I have to pay this.

1:09:55I had to do that. It's like taxes. It's like, I can't believe I have to pay these taxes. But then you go, well, I'm so grateful I have the income, right? It's that whole push and pull. I'm not saying that it's easy, but it's a good mental flip. Ken, what you got? Health Trust Financial. I want to mention them. They are partners of The Ramsey Show, health insurance broker. So what I love about them is they're going to go out and search and try to find the best deal. So I will make sure you get connected to them. Christian will connect you, make sure that you get there. But Health Trust Financial is the organization.

1:10:30We believe in them. I think they are worth calling so that you can shop around and let's see if you can get a better deal. Don't just assume that you're stuck. But do you know that it is going to be expensive? And they would shop around with other companies. It wouldn't just be. Yes. That's right. Yeah, yeah. So you've got to be open to companies that aren't blue cross. Just tell them you're a Ramsey show listener. They're going to take really good care of you. Great, great organization. Yeah. So, and then look at your options. But I know that that's like, and again, I heard you. And that's why talking to them, you're going to get to walk through all of the, will we lose our doctors?

1:11:01Do we have to change it? I know how important that is. So they'll take good care of you. Okay. That's good to know. Yeah. Well, thank you for reinsuring me. We shouldn't just go out. Like I said, we talked about just opening an account and putting the money in that, but then that scares me. With five kids, that's a big risk. No, it's three kids. Oh, family of five. Yeah. But still. Jennifer just had an episode. Five? What? Yeah. Unless you know something I don't. Yeah. Oh, no, no. No, I don't know anything. No, we don't know anything. I just, and I'm not saying this to be scary. It's scary. I'm just saying I would not do what you were saying about opening an account and just putting money because, listen, if somebody runs into you on the street and everybody's in the car, there's medical bills.

1:11:47Do you see what I'm saying? And$10 ,000 or$20 ,000 in an account is not going to help you. It's not going to cover that.

1:11:58What did the signs used to say? Keep calm and pay your premium. Keep calm and pay your premium because you need it. Yeah. Thanks for the call. I just need somebody to top me down off of that wedge. You're going to be okay. But again, I mean, your first call is hang up and call our friends at Health Trust. So they will be a good resource for you. And remember, when you have situations like this, options, options, options. Find every option possible. And it just kind of helps you in this emotional process because it's tough stuff. And I'm so sorry about this. I mean, you guys represent so many Americans.

1:12:32And I'm just going to throw this out there. we the people need to start throwing these bums out at the election dates because this is something that congress can fix they can fix it and they got to fix it it's unbelievable it's real real real i mean health health care is not a luxury you know what i mean it should be just a basic kind of right that we all have and they got and those companies got plenty of money so uh needs to be fixed we need reform uh all right let's go to matt in washington dc matt how can we help Hi, thanks for taking my call. Sure. So my wife and I are working on Baby Steps 4, 5, and 6.

1:13:11We're currently contributing 15 % of our income to our Roth retirement, our 529s, and we're putting any extra income on our mortgage. The more I listen, the more I learn about mutual funds and it being a big topic on the show. So I was thinking of changing how we're paying off our mortgage and only making the minimum payment and open an investment account to deposit all of our extra income in to take advantage of the mutual fund growing at a higher rate of return. And when that mutual fund would hit our mortgage payoff value to take that to cash that out and do one lump sum payoff. I was just curious of your thoughts on utilizing an investment account like that as a tool to pay off a mortgage for that for baby step six.

1:13:53Listen, there are worse things you could do. That's for sure. And I want you to hear that. I'm going to give you the answer that I think is the best answer, but I want you to hear that what you're talking about is not a bad idea by any stretch of the imagination, especially if your horizon for doing this is beyond five years. It's not a bad idea. The only my only caveat for this is sometimes when money is sitting, other things come up, Ken, that might give us a reason to pull it out. So, for instance, instance, the idea of if you have the money in your hand every month to double the payment or whatever that amount is going ahead and putting it on your mortgage so that it's done.

1:14:38The action is finished is a good thing versus having a stack of money in a brokerage where I don't know, maybe a trip to Turks and Caicos comes up and it just sounds so, so good. And you're like, well, we do have the 12 ,000 sitting there. It's tempting is all I'm saying. Now, you do sound like the type of guy who would never be tempted to do anything, but I'm just saying. Yeah, we just want you to work the baby steps. The baby steps work and they avoid all of that temptation. So don't try to rework the plan. The plan works for so many people, but you're doing great. Appreciate the call. Good question.

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1:16:55The Ramsey Show question of the day is brought to you by Why Refi. You don't have to stay stuck in a defaulted private student loan forever because Why Refi helps borrowers take back control with affordable refinancing options that actually work. Learn more at yrefy.com slash Ramsey. That's Y-R-E-F-Y dot com slash Ramsey. Not available in all states. All righty. Today's question comes from Sarah in New Jersey. She says, my spouse thinks that line items in every dollar should be a sinking fund because if we don't use the money that month, it rolls over the next month for future use. Okay. This includes things such as utilities, insurance, food, and spending.

1:17:37I've tried to explain to him that some things can be a sinking fund, such as HVAC replacement, vacations, or savings for a vehicle, but normally monthly bills are not. Can you explain the difference for him? Yes. So that question was a little in the weeds if you're just listening, but let's kind of break it down. So when you have your budget, obviously the income's at the top, and then down at the bottom in every dollar, you put all your expenses in there. That's everything from groceries to grandma's birthday. Everything you could spend money on goes on in the budget. Now, there are certain things that are not just monthly expenses.

1:18:10There are things that have the ability to happen every once in a while, but be a larger part of your income. Something like car maintenance can, or something like if you know, yeah, your HVAC needs replacement. You can put those things on the budget and you can do something on the budget that's called a sinking fund. It simply means that every single month you're putting aside a little in order to have a pool of money there. So it's just like a little mini savings fund. So if I know my HVAC is going to cost me$3 ,000, every month I can put aside$200 on my budget, and it's going to accumulate that money in a little pool for me so that it's there when I need it after a certain number of months has passed.

1:18:50So it sounds like what her spouse wants to do is make a sinking fund for every single item on the budget, which is a horrible idea because sinking funds are for things that we cannot cash flow in a single month. That's the best way to explain it. I can, in a single month, I can pay the cable bill or people don't have cable anymore. I can pay the YouTube TV bill, right? I enjoy, I enjoy cable. Okay. That's good. Sports channels. DirecTV. You keep that. All right. In a single month, Ken can pay his DirecTV bill. I can pay my YouTube TV bill. We don't need to set aside a little each month to pay that.

1:19:27That's very confusing. It creates a lot of issues. So Sarah, you are correct. and husband who will remain unnamed. Yes, let's utilize the sinking funds for large ticket items or large ticket repairs or trips or whatever that we cannot fund in a single month or even really in two single months, right? That's what sinking funds are for. Yep, love that. All right, let's go to Al, who joins us in Washington, D.C. Al, how can we help? Hello, thanks for taking my call. So the reason I'm calling is I'm married. I'm 31 years old. My wife is 30. We're finally thinking about having our first baby this year, hopefully, for the bad that it happens.

1:20:11So with that, I'm always being kind of financially savvy. I've always maxed out my TSP, maxed out Roth, IRA. My wife is maxing the same thing. So we're in pretty good shape. I'm of the mindset of, since we're planning to have a kid, of maybe insuring myself with either term or whole life insurance, I'm more inclined towards whole life insurance so when I bring it up to my wife she believes that I may be jumping the gun a little bit and that's her mindset the way she explained it to me was we're going to be incurring to another expense the way I see it is more as an asset and protection for her and the baby in case something were to happen unfortunately to me so that's kind of where I'm at I'm able to cover all expenses of the house.

1:21:05She's currently a nurse. So everything that she earns, she uses it, and then she invests it into whatever she wants. So I'm able to cover all expenses. I just want to know more of what you guys, I guess, the mindset that you guys have on this. I'm trying to see if I could get insurance on myself, more so for protection and hopefully to leave something behind for my kids and grandkids one day. Well, I think that, Al, your sentiment is right on the fact that you're thinking ahead about your family and you're considering life insurance is exactly right. I think it is a sobering conversation to bring up that I want to have insurance in case, God forbid, something happens to me and your wife's carrying a baby or is going to be carrying a baby anyway.

1:21:57She's in a sensitive state and that can be tough and, you know, to kind of reconcile in your brain. So I would just form it to her like this. I would say, listen, there's going to be people in my life that are dependent on my income. and if something god forbid happened to my income how would you guys live how would you it would just give me a lot of peace if i knew that if something happened to me you would have plenty of money you would have you know and you can talk about what that amount is i would say 10 times your income that you would have this million dollars or whatever it is setting there in case something happens that just gives me peace of mind it's a way that i can love you guys really well and it's not very expensive right if you can have that conversation with you with her i think that she'll understand where you're coming from.

1:22:44But let's talk about the type of insurance, because I think I heard you say that you want whole life. And that's correct. My mindset is more so. So I have a couple of rental properties. I have been invested into the market and all that stuff. My mindset is for protection. And then also, how can we also make it a solid foundation for everything else? Well, Al, I'm going to let Jade walk you through this, but let's be very, very clear. Your whole life is actually not insurance. Okay? It's not. No, no, no. I want Jade to explain it, but you really understand because you call this what we teach. You need term life insurance at 10 times your income.

1:23:25That is what's going to protect your family. That's what's going to take care of your wife and kiddo if something happens to you. So I don't know if somebody's selling you on this, but it's not insurance. It's a horrible financial product. That's our position. You want term life, Xander insurance. You want to call them up and have them walk you through how unbelievably affordable, by the way, term life is. But I'll let Jade take the thing on the why here. But we have never, ever, ever, nor will we ever recommend whole life. In fact, if you want to get Dave Ramsey really hacked off, you call and you ask him about whole life.

1:24:02You know, it's a bad, bad product. I'm not going to get mad at you, Al, but I heard you say, because I think you have the right underlying thought, I heard you say you want protection. And so let's talk about the best way to get that. So with a whole life policy, let's pretend you're paying, I don't know, let's make round numbers, and these are going to be low. Let's pretend you're paying$100 a month for a whole life. Well, part of that money is going to go to your premium. And then part of that money is going to go in another fund that's a cash value. OK. And part of that money is being invested at a very low rate of return.

1:24:41And the other part is going towards your death benefit that if you die, this is the money that your family gets. Well, why split that payment when you can pay, get term life insurance and just pay for the policy? and then whatever money is left, you can invest on your own because you're into investing at a higher rate of return. So all we're saying is why give somebody money that they're gonna invest poorly for you when you could invest it at a higher rate of return for yourself? That's part one. But part two of this, Al, is if you die, they don't get the cash value. All that cash value that is accumulating at a very, very slow rate of return, if you pass away and that money's sitting there it's not going to go to your family the insurance company is going to keep it and the only way that you could get access to that is if you cashed out the policy if you got to it early and at that point you're going to have to pay a bunch of fees so it's not it's not a fair product for you it's almost like having to choose one or the other and so for that reason I'd say hey just spend half the amount on term life and invest the rest on your own.

1:25:52Does that make sense? It makes sense. I understand your positions on term life insurance. I was, I guess, with the mindset of seeing it as double, two perspectives on things. So one being protection and then also... No, protection is not... Mine gives you protection too, so there's no upper hand on the protections. So you got to have another argument because there's no upper hand on whole life for protections. So unless you have a better argument, I'm just telling you the facts. Yeah, I mean, Jade's right. And the real argument is, is the stock market's averaged 12, 11, 12 % over the lifetime of the stock market versus 4.5 % at most on whole life.

1:26:31You might as well park it in the HYSA at that point.

1:26:53welcome back to the ramsey show in the fairwinds credit union studio i'm ken coleman jade warshaw is alongside we're excited that you're with us 888-825-5225 is the phone number to jump in let's stay in our neighborhood here nashville tennessee zach is joining us now zach how can we help Hey, Ken. Hey, Jayden. Thank you for taking my call. Sure. What's going on? Hey, so my wife and I, I'll try to be brief. We're 32 years old. We have$177 ,000 in debt. We make about$174 ,000 combined, about$35 ,000,$40 ,000. That's overtime for me. But we have a tax return and a company bonus coming up that's around a$14 ,000 lump sum.

1:27:38We're trying to see if we should take that money and pay down to get rid of our auto loans that we have and get into something cheaper. Or if we should just use our car loans as a line item and take that money and start doing our debt snowball. And also, neither of us are investing at the moment. Likely, yes, but I want to hear more. So break down the$177 ,000. Tell us what's the cars and tell us what's everything else. Sure. So we've got the vehicles between myself and my wife,$44 ,000. Mine's$21 ,000. Hers is$22 ,000, roughly. $81 ,000 in student loans. We both are almost finished with our – she finished her bachelor's degree last year, and I'm finishing mine this spring.

1:28:23And then$52 ,000 in consumer debt, like credit cards, line of credit, personal loans, et cetera. Okay. Okay. And the personal loans, when you break them down, what's the smallest one? We have some as small as$3 ,500, and then we have others. I'd say the highest is around$10 ,000. Okay. So between$3 ,500. Okay. Good to know. What are the payments on these cars? So the payment on my truck is$379, and then her Honda Pilot is$457. Okay. And what did they originate at? I'm trying to see if they were ever too expensive for you. What did they originate at? So, I mean, mine was$23 ,500. I think I could sell mine.

1:29:12They're both used vehicles. I could sell mine for probably what it's worth. She's got about$4 ,000 in negative equity in hers. Okay. If you wanted to sell them to go faster, you 100 % could. How much is the bonus and the refund? The tax return is about$12 ,000, and then$2 ,000 is a company bonus. And I just updated my W-4 to change my tax withholding because obviously that tax refund is a little too much. You could do that. I'm not going to say you have to. They were never like crazy outside of your range. Maybe you do one and keep the other. That's totally up to you. $14 ,000, though, could knock out lots of these smaller loans.

1:30:02And I think that would give you probably free up a similar amount of money and give you a bigger boost. Because there's something about when you've got like 20, a list of 20 debts, and it goes from like 20 to, I don't know, 12. That feels great. So how many of these personal loans do you think you could knock out with the$14 ,000? Yeah, I know several of the credit cards and some of the smaller personal loans. I think we can take probably five of those off the table, get us some quick wins, and have a little bit of margin there to start tackling the next one. I just want to make sure you guys would maybe start the way versus, because these aren't like crazy high payments that we're paying, and I commute to Nashville for work.

1:30:47I actually live in Cookville, but I commute for work. So having a reliable vehicle is helpful. That's good, yeah. If you guys said, hey, get a beater with a heater, you know, then we would do that. We just was curious kind of what you guys thought. Yeah. A lot of times is if you can pay off the car in two years or less and it be as part of your snowball, you could keep it as long as it was never too big of a chunk of your income to begin with as far as it being an item that's going down in value. At$174 ,000 of income to have two$20 ,000,$23 ,000 cars, it's not a bad thing. It's just that you went into debt for them.

1:31:20I would do it. Ken would. I probably, I would too, if I were in your shoes, but I'm not saying you have to. Yeah, we're not telling you have to, but I would tell you that I am of a mindset that I want to knock this stuff out and I want to do it as fast as I can. And I'm willing to suffer short term so that I can win long term. What were, I'm just curious, which way were you leaning prior to calling? it's been a 50 50 split um we've talked about getting debt free for a while we're long-time listeners um what do you mean by 50 50 what do you mean i i think me and my wife have had discussions saying hey let's just sell them both and and you know use some of this 14 000 to you know move both these vehicles and get in something cheaper let's buckle down let's do it and then the other half of me says you know i commute quite a bit you know an hour each way to national airport based on my job.

1:32:14And so it's like, you know, if I'm trying to make that commute in a vehicle... I get that. So you know what I would do? Get rid of one. Keep one. And I'm with Jade. I was exactly what I was thinking. Keep the most... Hers has the negative equity. Okay. So would you pay the$4 ,000 and maybe keep my truck for reliability purposes? No, I'd flip it. I'd flip it because you don't want to be spending money that you don't need to right now. If you end up paying off the car, the negative equity is not going to matter. This isn't going to be a fun conversation, probably not a popular proposal. But again, I'm going to tell you exactly.

1:32:46I wish Stacey were here. She'd say this is exactly what Kim would say. I would say, all right, we're not going to sell the one with the negative equity. We're going to sell yours, and you're going to take what is her car because you're the one driving a long way every day, and she's going to drive something that's not quite as awesome. Yeah, and you're both taking one for the team, just in a different way. That's exactly what I would propose. Now, I don't know how your wife's going to feel about it, but I'm calling balls and strikes right now. Ken, you and I are on the same page. Hands in the center.

1:33:15And by the way, and to validate, I'm talking about it. This one has done it. She and Sam, when they got their story going, they went down to one car. So I believe in what I'm going to call shocking the body. I learned this term from a friend of mine, you know, in college. It was like when you start a new workout plan, you got to shock the body, right? And you just go in on a completely new routine. And what he was talking about is you get the muscles, all of them just like, what is happening? And you start to get real returns. And I believe in that. I believe in it. In most cases, I almost always am a little bit more aggressive because I believe in shocking your system to go, holy cow, we have burned the ships.

1:33:56We are in on this deal. Fight or fight. Yeah. So I agree with Jade. I think she's right. I don't want you to hear me saying you have to do that. I'm just giving you an alternative it all depends on how on board your wife is with this because you have to be you have to do this in a way that you're both going to be fully committed and it doesn't sound like it but every once in a while it's like if you go too extreme too quickly the other spouse is too shocked and wants to bail out it's a great point I agree with Kim then I think she'll like this plan because it's the best of both worlds. You're still safe on the road.

1:34:38You still have one that's a hoopty. You still clear out$457 of payments. You still, you know, you're not eating up the whole$14 ,000 on getting two new cars. You're only, you know, eating up maybe four or five of it. And you're still knocking out, I don't know, four of these smaller debts. So it's really good momentum boost. Massive momentum. I love that, Coach Jade. I feel like you just got off the clipboard. You were drawing up a play in the timeout. Strong side. I love that. You know, I'm going to tell you something. Momentum, I don't care what area of your life you need momentum. When you start to experience it, when you haven't had it, man, it is nice.

1:35:16Yes, it is. It can really set you free. Hey, love the call. You guys are going to do it. We're rooting for you.

1:35:41You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage. To protect your biggest assets, I recommend using Ramsey Trusted Pros. Whether you're looking for car, home, or any other type of insurance, Ramsey trusted providers have been coached and vetted to serve you like we would. Find what you need at RamseySolutions.com slash insurance.

1:36:27One of the best things you can do for your finances is to have a really good tax pro in your corner that you can trust. They're going to help advise you on best moves to make for your situation, for your small business, especially if you've had some big life changes. So go to RamseySolutions.com slash tax pro. That's RamseySolutions.com slash tax pro to find CPAs and enrolled agents that have been vetted by the Ramsey team. Jessie is up next in North Carolina. Jessie, how can we help? Hi, thanks for taking my call. I am a single mother to a 10-month-old baby, and I have$25 ,000 in debt and a low income.

1:37:02So I wanted to know how I can get ahead and plan for the future. Specifically, my goal is to be debt-free and eventually save for a home for my daughter and I. Great. Tell us what your low income is. I make$26.67, so$2 ,667 after taxes per month. What do you do? I work from home for an insurance company. Doing what? I do customer service with providers. Okay. And do you need to work from home just because of the little one? I would prefer to, yeah. Do you have family or friends that, if you had to, I'm not making you commit to this, but I just want to know, is it possible that other people could watch your child?

1:37:51It is possible, but not consistently. Is the$25 ,000 of debt, is that a one-time thing that's done and over, or is the debt accumulating because you're using a credit card to fill a gap? I don't use credit cards, but it is accumulating because of interest. It does consist of student loans, some credit card, and then medical bills and personal debt. Okay. So even with you paying the minimum, obviously it's been accumulating over time, is what you're saying? Yes. Okay. Do you have any control over your budget or do you feel like you're paycheck to paycheck and not knowing where your money's coming and going?

1:38:36I've been using the EveryDollar app every month. And so that's been helping me to see where everything is going, but I kind of just feel stuck right now. Are you at 40 hours a week or is it below? I'm at 40 hours a week guaranteed. And I've also been working an extra 10 hours per week, with the exception of holidays, to work some overtime. Does that bump you up from the number that you gave us? Or did that include your overtime? So with overtime, I can make an extra $100 to$200 per paycheck. So that doesn't include overtime. Okay. So we could say$200 to$400 if you're getting overtime in addition.

1:39:23Yes. Ken can speak to the career side of this because I wonder if there's just, and I believe there is, if there's another type of job you can do from home with your skill set that can just pay a little bit more. What's your hourly rate or are you on salary? I am hourly. I make$21 per hour. Yeah, and the reason I went that line of direction of questions right out of the gate is the answer to your question is, and Jade will walk you through, where can we cut, make sure you really got your budget in line. But you're going to need to make some more money. You just are going to. It's going to make you that you're getting out of debt.

1:40:02Now, here's the great news, and Jade will give you more insight on this, but the$25 ,000 doesn't freak me out for you. However, we do need to get more income. And especially if you're going to want to save up money for a down payment on a home. So I'd like to see you getting in that$30,$35 an hour. So can we take and hear the questions you're going to ask? And I'm going to give you some resources at the end of the call because I want to get Jade involved here real quick. And let's see what we can squeeze out of our current income. But you need to adopt the mindset that you can make more money and you should make more money.

1:40:35And so now it's a question of how do you take the current experience you have in customer service and can you jump up the ladder a little bit? For instance, one thing I think you ought to be thinking about is contacting a company like Belay, who's been a partner of the show for a while and involved with other events. I know their owners and they're one of the best agencies in the country for virtual executive assistance. Yes. And so the very nature of the job is working from home and virtual. But when you're working for an executive, you're going to make more than$21 an hour. So if you have that kind of administrative skill set and some experience there, that's the type of thing that you've got to open up your mind to.

1:41:16And that would change your life dramatically if I sat you down with Jade and said, hey, great news, Jade. She just went from$21 an hour to$35 an hour. Changes everything. I mean,$500 would change your world right now because there's part of this. I agree with Ken. Got to get the income up. I'm guessing your budget is pretty slim as it is. Am I wrong or? Most definitely correct. You've cut it down as far as you can go. So there's really, there's two plays here. You can do what Ken said, which is really, really actively seek to find other jobs that pay more. And in the meantime, do your best to do as much overtime as you can, because if you can keep your minimum payment at just the right amount, right, if you can kind of figure out what that amount is where it's not aggressively paying the debt down, but it's also not allowing it to creep up anymore, you're kind of just keeping it at bay and staying above water.

1:42:14there's that's good right we don't want the interest to accumulate but i think if you can do that while looking for a higher paying job that's your only choice at this point because you know income is the magical elixir to you know to fix this problem now if you find yourself in a position let's just can you love doing this and it's so true if you find yourself in a position where you have either found a job or the job you're making you're able to you know make a little bit more and you're at that point where the 25 ,000 isn't really accumulating, maybe it's slowly, slowly going down. There is part of this where you've got a baby and you're in a season of life and sometimes there's seasonalities that limit you and there's just a part of that that you accept and go, well, right now this is where I'm at.

1:43:00Maybe when this baby goes, you know, four years from now, your life looks totally different. They're going to kindergarten and life is totally, totally different. So both of those are things to kind of look at and accept and understand what are your values during the season? Obviously, it's to stay home, to what extent, and what does it look like for you financially? Is this a season of treading water and not going any deeper in debt? Or is this a season of trying to pay off debt? And you get to decide that. You're looking at a four or five year horizon before this kid goes to school. So that's a lot of time.

1:43:32So you get to decide is this first year that I'm just focusing on the baby. And then when he turns one, that's where I'm going to try to kick it into high gear. Do you see what I'm saying? Yeah. You've got that to play out. How, how connected of a person are you? And what I mean by connected, I'm not talking about celebrities or any of that nonsense. And I'm Mr. I'm Mrs. Network. I'm saying, are you pretty connected to friends and family group in your area where you live or are you kind of just a real small circle? I am connected to two local churches. Right. Yeah. So you know what, Jesse, I don't know how aggressive you're being right now, but I think now's the time.

1:44:13I would never bet against you because you're a single mom. I think the single toughest person on the planet is a single mom. I've always had mad respect for you. And I think you've got to really believe in yourself and go, no, wait a second, I've got a Good job. I mean, you got a good job. Yes. Okay. And you found that somehow. So what must you do to find a better version of what you're doing now? And I'm going to put a number out there that might seem like a stretch to you, but I want Jay to react to it instantly, just so you, because we've not scripted this, right? If she could make an additional two grand a month, how quickly does she get out of debt and then get through baby step three and 3B?

1:44:51Well, with the extra money, that's one year. An extra$2 ,000 a month, that's$24 ,000 in the year. Jessie, are you picking up what she's laying down? Yeah, I can see that. That would be amazing. So now here's the fun exercise. And I love what Jade said to you. I don't want you to get off this call and be stressed because you're doing something so important right now, which is raising a human being. And you're managing to kind of get through. But if you could figure out how I can make an additional$2 ,000 a month, it is life-changing, yes or no? Yes. Yeah. Now, listen, this is where the connections and the network of people come in.

1:45:29You go, hey, I've been listening to the Ramsey Show. I called them. I got a plan, but I need help with the plan. Right. I know how to budget. I'm going to get better at budgeting. But I need better professional opportunities. And the right people want to help somebody like you. But this becomes your number one job outside of your regular job is to find better, better work. Now, here's what I want to do to help you. OK, I'm going to give you some information. I'm going to give you my Find the Work, Your Wire to Do book that has the Get Clear assessment in it. Take it. Let AI spit out some great opportunities for you.

1:46:01Hang on the line. Good things are coming for you, Jesse. Thank you for calling.

1:46:23where you do it. So guess what? Ramsey Solutions is hiring. If you're ready to join an amazing team that's all about changing lives and spreading hope, we want to see your application. Right now, we're hiring for technology, sales, marketing, writing, copy editing, and creative roles. Check out all our job postings at RamseySolutions.com slash careers. That's RamseySolutions.com slash careers.

1:47:01On the debt-free stage in the lobby here at Ramsey Solutions are Colin and Megan. Welcome. Hello. I guess you guys are here to do a debt-free screen. That's why they have you on that stage. Am I right? Yes, sir. Nothing gets by me. I am on top of the details today. I see that. Yes, sir. Where are you guys from? Destin, Florida. Oh, that's a nice place to be from. Any chance I can hop a ride back? Absolutely. Okay, that'd be great. I'll just tell Stacey and the kids, I'll be back in a couple days. It's going to be great. Going to see some friends. I'm kidding. Don't worry about that. Nothing to be alarmed about.

1:47:33All right, give us the numbers. How much debt did you pay off? $215 ,514.72. Wow, we don't want to miss that. Okay, and how long did that take? 23 very long months. 23 long months. Wow, that's fast. What did that consist of? What's the debt? All student loans. All student loans? Just you? Just me. Wow. And that's it. You didn't have any other debt but student loans. No, sir. What was that for? Pharmacy school. A private pharmacy school. Wow. So please tell me, that means you got some income coming in. Yes, ma 'am. What was the income during this? Starting at around$164 ,000 and then ending at$254 ,000.

1:48:15Whoa. Help the math. Help me with the math. What in the world? That was a lot of overtime. Like in the month of June, I maybe had six or seven days off in totality. Like we just, we both went after it. What were you living off? I want to know your monthly budget that just went towards you guys, that did not go towards the test. It was very little of ourselves. I would drive home for lunch every day. You'd just eat ramen noodles almost every day of the week from work. Oh my word. Now, is it the healthier ramen noodles or is it the stuff I ate in college? The stuff you ate. The orange packet. Merchant.

1:48:50The orange packet. I'll tell you what. There would be several days I would warm up ramen noodles and drive 30 minutes to her work and give her ramen noodles for lunch. Rice and beans was cold ramen for us. You are a good man. Oh, my heart. It's true. My heart hurts. If Mrs. Coleman would let me eat those, I would eat those. Listen, they're delicious. They are. They're terrible, but they're delicious. I'm telling you. Wow. So you took one for the team. For 23 months, you ate chicken ramen. Well, did you at least vary the flavor a little bit? Did you get the beef? A little bit. Yeah, a shawm. All the time.

1:49:20Okay, good, good, good. By the way, what do those, because I think this is good information for a lot of people. What do those go for now? Because back in my day in college, I'm dating myself. You could get 10 of those for a buck. Yeah. What's the cost of these? I don't remember now. Yeah. I don't know. We shop at Aldi, like completely. So that's kind of a hard gauge. You don't even know how much they cost. No. Wow. So tell me, now I'm entrenched now. Tell me a day. Tell me what you eat in a day. Ramen. That was the one. It would be ramen. Every now and then a week, we'd mix it up, do peanut butter sandwiches.

1:49:50But that was it. No jelly. No jelly. Well, he's weird. He doesn't eat jelly on his peanut butter and jelly. I wasn't going to say that. But since you said it, I do think it's weird. It saves money, too, though. What's breakfast? Just like a bowl of oatmeal. Just oats. Who's breakfast? I don't know her. What? Wow. This is extreme. This is gazelle. Yeah. This is gazelle intensity. Okay. Wow. So we're having fun with this. But you guys really, really busted it here. Okay. take us into that what were some of the emotions that you dealt with during this extreme gazelle intensity flavored by ramen um i would say like frustration given so much money over that like she basically worked for free because you know her whole paycheck was just going towards the loans yeah so it's just that frustration of like hey all this money is really belongs to somebody else time we, you know, pushed that frustration.

1:50:41Yeah. Oh yeah. And for me, it was really fear. Like I, I was always afraid that I wasn't going to accomplish or we weren't going to accomplish what we set out to do. Like I don't, we didn't have to do it in 23 months. We wanted to, my goal was always to pay it off before he retired from the military. And so like that fear and that pressure I actually put on both of us of what if we don't actually do that? You know, if we did it in five years, that's great. I mean, any amount of time less than 10 or the rest of our lives is better. So what, take us back 23 months ago. What was the catalytic? Oh, I'm seeing giggles.

1:51:13I like where this might be going. What happened 23 months ago that decided that you guys came together and said, we're going to do this. So towards the end of our pharmacy school, she was stressed about paying off student loans and I'm the free spirit. So I'm like, we can pay a thousand dollars for our lives and get this out of our way eventually. Um, and then one day being the free spirit, I impulsively put us in the negatives by buying a pair of headphones. And I was like, there's got to be a better way. And then while I was just wrapping up farming school, I read Total Money Makeover at Barnes & Noble.

1:51:42And then I was like, hey, we can do this. And then it kind of started. Did you say you read it at Barnes & Noble? You didn't buy it. You just went there to read it. Listen, I thought the same thing. The dude just admitted, didn't buy Dave's book, just went in there and treated it like it was a library. Life hacks, life hacks. By the way, raise your hand if you've done that before. I've done it. I've done it. I've done it. I've got to admit it. I love your honesty, my man. Confession's good for the soul. Sorry, Dave. Okay, so you're reading the book, all right, and you're getting this in your system here.

1:52:15You're going, okay. And you're the free spirit, and you come home one night and tell her, hey, babe, I've been reading this book. Is that how this went down? Pretty much, yeah. I mean, I was petrified because going negative is not great. So that fear got you all in? Oh, 100%. I mean, I've always been like a penny pincher and I've always, you know, oh God, where's my next meal coming from kind of person. So like when he came to me with this, yes, absolutely. Say less. Wow. Wow. Okay. So I have a question. I saw the flash the photo up and there was a whole wall and on the wall said our why what was under that?

1:52:50What's there? Oh, I like that. Oh, look at it. So right before we started doing the journey of like paying this off, I bought these thermometers on Amazon. And so we broke down how many loans we had and you'll see one of them is 62 50. And so every time we would pay off a loan, we would color it in. And so each, um, loan or like benchmark, cause some of them are some pretty hefty loans. We would have a benchmark. So like, I'm going to be honest, 75 % of it was food motivated. So, okay, we paid off this much. Now let's go get some food. Yes. Yes. I've been saying that that's what I've been saying.

1:53:21Milestones. I'm sorry. I'm very excited. I feel like I should get out of the way. There's a lot, a lot of connection so very good give us an example what would you go get chipotle 100 oh so you reward yourself you reward yourself non-ramean meal yeah yeah it's it's not enough to throw you off track it's just enough to keep you going i like it what about dessert did you ever get any dessert can please no it's just the benchmark i apologize i apologize i have just instead of spending 12 cents they get to spend a dollar and 12 cents all right uh after all that ramen, I would need some sugar. That's all I'm saying.

1:53:55Okay. So what would you all say to people that are listening and watching is the key to working the baby steps and getting out of debt? What's the key? I would say communication. Uh, we've been married almost 15 years now. So it's kind of like building a budget for the first time and actually try to work through that. Um, it can be difficult and kind of showing yourself grace too in the beginning. Like, Hey, we're learning a new way of life. Um, so trying to show yourself that grace. I would say like the whole process has just been very therapeutic as a couple, actually, like learning I mean I've known him since I was 19 but like really learning like how he spends how he saves it's just just do it I mean it really is hard and yes it matters how much you make but it really doesn't it's determination it's perseverance like say you want to do it write it down and do it boom I would say it flies by too like before you know it you're out of it so you know we started this like$215 ,000 like this don't take forever and as soon as we got on the other I was like, that actually flew by like nothing.

1:54:51And it feels so free now. Have you, I think people really want to know this. Have you had ramen since you paid it all off? Yes. I knew it. I knew it. I'm like, this guy just likes ramen. Oh, that is so fantastic. Okay. So how old are you two? I'll be 37 this year. And I'll be 35 in July. So now how has this changed your perspective about your future now being debt free? Oh, it feels amazing. I haven't, I, again, being free, being like, do what you want, go where you want and not have like, just the freedom of like, hey, I can move, you know, a different career if I want to. I can, you know, whatever it may be, just we have that freedom in life to just, you know, move forward.

1:55:28And it's like a level of stability that I never had growing up, something that I've craved my entire life. And like, we, we got that. Good for you. We have stability. Peace. Are you still in the military, sir? Yes, sir. What branch? Army. Well, thank you for serving our country. You're a great American. Thank you. Absolutely. Well, there it is, another young couple. Isn't it fun just to see like a complete future? You guys are going to be millionaires. You're going to have all that stability, and you earned it. All right, you guys ready? Yes, sir. Okay, here we go. We got Colin and Megan from Destin, Florida.

1:55:58They paid off$215 ,000 in some, some, some, some, some, in 23 months, making$164 ,000 to$254 ,000. Colin, Megan, you inspire us all. Count us down. Let's hear your debt-free scream. Three, two, one. We're death free! Yes! Yes, you are. But not ramen free. Big distinction. Never that. So fun, isn't it? Excellent. Major intensity. Well done, well done, well done. They put a beautiful picture on what gazelle intensity looks like. Folks, it's worth it. You heard it from them.

1:56:42you

1:56:50Hey guys, what's up? It's Jade and I'm pumped for the new year and I hope you are too. But the problem is most people start the new year with a lot of promises and no real plan. You know how it is. I'm going to save money or I'm going to get my financial act together. But without a plan, you just wing it and hope it works out. Listen, don't play yourself. I want you to win. And our EveryDollar app is the game changer you need. In 15 minutes, EveryDollar helps you build a plan based on where you're at with money right now. And every day, the app coaches you with ways to find extra money so you can beat debt and build wealth faster.

1:57:28It's like having me in your pocket, helping you stay on track all year long. So don't just wish your money works out. You can be the one to actually make it happen this year. Download the EveryDollarBudget app and get started right now for free.

1:57:56our scripture of the day Romans 13 verse 7 give to everyone what you owe them if you owe taxes pay taxes if revenue then revenue if respect then respect if honor then honor and our quote of the day as we celebrate Dr. Martin Luther King is from Dr. Martin Luther King the time is always right to do what is right that's good Simple but profound. Yes. The man had a way with words. He did. I love it. All right, let's go to Mike in California. Mike, how can we help? I've been on the Dave Ramsey program for a while, me and the wife. We got all of our bills paid off. We're able to buy a couple of cars, cash.

1:58:42We're at the point of wanting to pay our house off. But I was married prior and I got put in a modification because I was going to let the house go. So there's a$50 ,000 balloon payment at the end of the loan. And we're about 10 and a half years left. And that's just on the loan. And then I have a$50 ,000 balloon payment. Can you refinance out of that? Well, the problem is I got a 2 % interest. Nobody's going to touch that. I'm saying you can't refinance that loan. You can't call up Churchill and say, hey, I need to refinance this thing. Yeah, but it's going to make the payment go up. And right now I only have 10 years, 10 and a half years left besides the balloon.

1:59:35I don't know if I should just start hitting the balloon payment. you know every month we start because i can start paying on it it's interest-free the balloon payment there's no interest on it should i start trying to hit that thing or i mean i thought about refining the loan which i would love to because my ex-wife's name is on the loan an even better reason yeah i know she's not on the deed though that's my new wife is all we've already she's sign the house over to me and all that, but the loan, you know, is, is the issue. If I, if I can understand this and I, you got me when you hit, when you mentioned balloon, my mind zoomed out.

2:00:17So there might be more details that you want to fill me in on later. But from what I hear is an old house that I had with an ex-wife that I'm living in now with my new wife that has a balloon payment. That's going to be due a$50 ,000. And even though it has a fine interest rate of 2.5 or 2 % I don't remember what you said, 2 % now 2 % yeah for me this is not good in my mind I go, if I'm your new wife I don't want to live in your ex-wife's house and I certainly don't want to live in it with a balloon payment at the end that we're going to be due for in the next however long, that's where my brain sits why would you not, and it's got your ex-wife's name on it, so why would you not either sell this house.

2:01:07I would sell it now that I see that your ex-wife is even on it because it's not fair for her to be attached to that either. Do you want to know why? Why? Because my new wife loves the house. Oh boy. She doesn't But your ex-wife is on it. I know. And that's not fair to her. I know it ain't. I agree with you 100%. So you've got it. At that point, it doesn't matter. at that point it doesn't matter if you love the house there's plenty of houses out there she can love but your financial life is going to be tied to your ex-wife for life if you keep this home for life that's not fair to her if she tries to no no once the house is paid if we pay it off in 10 years she'll be gone 10 years is a long time my guy that's a long time to be tied in yeah but if we if we do if we leave now and try to buy another house our payment our payment's only $1 ,400 a month.

2:02:02I know that. I understand that. So if I, if I do this, our payment's going to go over double, if not higher, and then I'm going to have, yeah, I'm going to have to get a second job in order to pay for it. No, that's not true. So here's, here's what's true. I'm going to, I'm going to lay out what's true and then we'll talk about it. We could talk. The truth is you're divorced from her. That's true. The truth. Oh yeah, that's a truth. That's a truth. And you're remarried. That's true. Other thing that's true is your finances should not be connected to your ex-wife for any longer than necessary. Fair enough?

2:02:37Yeah. What's also true is there's a $50 ,000 balloon payment here. Yeah. Okay. These are all truths, what we'll call in the con category. The only pro is your wife likes the house and there's a 2 % mortgage. That's really the only pro. So there's part of this that you have to accept because of the divorce. And I'm not saying it's wrong or right. I'm just saying because of the divorce, your housing situation is going to change. And I think you just have to accept that you can't keep it as it was because a major thing has been upended. And so there's change there. And to say, hey, well, we can pay it off in 10 years and to have that link to her for 10 years is unfair.

2:03:25It's to everybody. Do you see what I'm saying? Because if something happens, if anything happens that changes in your life, that causes you to not be able to afford this house, that causes that balloon to be an issue, it's going to affect her majorly. Well, it's also going to affect you, Mike. Like you're talking about getting another job, all these things. And the only thing, by the way, I'm just letting Jade roll here. This is fantastic. But I agree with her. by the way. I agree with her. So I'm going to take what Jade said, and I want to put this back to you and go, after hearing everything Jade said, which, by the way, I heard you categorically go, I agree, I agree, I agree.

2:04:04If I'm hearing you, and I'm hearing Jade, and I am, the only reason you're considering this is because your current wife likes this house. Yeah. And it's in our budget as far as being able to afford... Well, but she already knocked that one down. Live the way we want to live. Well, but no, you can live in other places. No, no, no, no. She knocked that down. You can live in other places. The idea that this is the only place where you can live within affordability is a myth. And it's not affordability. You have a$50 ,000 balloon. Yeah, it's not affordable. Yeah. And it requires you to get another job just to afford it.

2:04:40So you've created, it's like after all that, you're still stuck in this thing. This thing, and I guess what I'm trying to help you see as a friend, Mike, is I think this is because you would rather be miserable than be uncomfortable. No, no, you didn't let me finish. You'd rather be miserable instead of be uncomfortable and telling your wife, we're getting out of this. We're changing our life. You don't want to have to tell her that. Tell me if I'm wrong. No, honestly, no, you're wrong. Okay. Because we, here's what our plan, what we wanted. We wanted to sell this house and meet us, retire up by Cambria, up in northern Cal.

2:05:22You know where Cambria is? Sure. I don't know if you. Up north. So we, yeah, up north. So we, because we love it up there. That's, she loves it. But, you know, her daughter's here with the grandbaby. Her son lives here. So those things are in factor. My two kids are out of state. I got four grandchildren with them. So did your wife change her mind completely on the move up north? No. The reason why we decided maybe not is because of family and stuff, you know, like being close. How far? Because we left the grandbaby. I totally get that. Never going to dismiss that. But how far away are we talking about?

2:06:02It's probably five and a half, six hour drive. And that still has no bearing on whether or not, because it's like, okay. Well, I'm trying to get it in the mix to go. That's why you should sell this house because they already had another plan. I mean, but even if you've decided that's no longer the plan, if it is or it isn't. I know. I'm trying to make this hard decision easier. I'm with Jade on this. You know what? She's the one that got me in on the Dave Ramsey thing because I was the opposite. Okay. When it came to bills, I wanted to, if we didn't have it, let's go get it. I want to enjoy life.

2:06:34But when I met this woman here, she turned me around. in my mind. Tell her you called us today and we said no to the balloon payment. I just think you're on a tightrope without a net. You're just walking this thing and you're hoping you get to the other side. It's a 10-year journey with a$50 ,000 barricade in the middle. And an extra job for you. And an ex-wife yapping about having this debt around her neck. I don't hear from her ever. Yet. No, I mean, I haven't for years. We've been married for 10, going on 10 years now. You can do what you want to do, Mike. We have spoken. And you said your wife introduced you to us, and now you called us.

2:07:20You do what you want to do, brother. But enjoy that second job, man. Enjoy that and that stress. Well, I hate to do that to him, but that's the facts. That's the facts. That's how we see it. Hey, folks, remember this. There's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. See you next time.