"We're In $580k Of Debt At This Point"

0:00Brought to you by the EveryDollar app, start budgeting for free today. Normal is broke and common sense is weird, so we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studio, this is the Ramsey Show. I'm Rachel Cruz hosting this hour with my good friend and co-host of Smart Money Happy Hour, George Campbell. We'll be answering your calls, so give us a call, a AAA 825-225, and we'll be talking about your life and your money. First up, we have Jimmy in Los Angeles. Hi, Jimmy. Welcome to the show. Hey, Rachel. Hey, George. Big fan of y'alls. Thank you so much for what you do. I really appreciate everything that you guys do, and I've gained a lot of knowledge these past few weeks, learning more about what you guys do and how to kind of like financially

1:04plan my future, but I've kind of gotten myself into a sticky situation, and I'm just trying to see if I can maybe get some guidance on trying to find a way out. Sure. So what's going on? So late 2024, I retired from the military, served for 22 years, and earlier that year, I decided to open up kind of like a shop, and where we just do like detail services, paying protection film, raps, and things like that, and it actually cost me a lot of money throughout that year. I'm sure. How much? Well, we're at a point now where we're like $580,000 in debt at this point. Okay. That first year, we took like a $220,000 loss, admittedly, I think I hired too many people full time, kind of went in too fast and too hard on that, and it kind of really hurt

2:12me. I had to take like an SBA loan to kind of get caught up and use a bunch of credit cards. And then the year after we've admitted, so just last year, we knitted about 35% net loss. So we had another net loss, but it was a better net loss. And you're still throwing money at this thing. I'm still throwing money at this thing. I mean, it seems like your cat. It seems like we're kind of like making a way out of that. And what's the stop loss here, a million dollars in debt, and then we'll call it quits? I mean, at some point, you just got to go, this ain't it. I would rather pack it up now versus try to, it's like a gambler where they lost a bunch of money in Vegas and they go back to go, like, well, now I got to win even bigger to get out of this mess. Right. So I was afraid of, and through this process, I kind of been free labor. So I haven't been getting paid by my business.

3:12On top of that, how are you paying your bills through more debt? Do you have retirement to military? I do. Okay. What's that per month? My wife works to, I pull in about 55 100 take home per month from my military retirement. And then what she makes about, she makes about like take home 45 100-ish per month. Right. So 10 grand a month is what we're taking home and that's the hard truth is that's the number we need to actually pay down this over half a million dollars in debt. What does the trajectory look like for revenue? It's looking positive because last year, I said, even though we had a net loss, it was a smaller net loss. And I think this year will be in a positive, but I'm struggling because like, I've been working for free for two years and eventually I'm just a businessman.

4:15Well, and digging deeper in debt, I mean 35% lost, I mean, this is just a very expensive hobby at this point. This isn't a business. Even if it breaks even, this isn't worth it. No. Right. Yeah. Well, I'm afraid of. Yeah. Jimmy, when you, when you project out, what do you, with all these loans, how much is the, is it half a million now or how much debt in general, I'm just trying to, I'm trying to project out like what, by, I don't know, in the next like month or two, like how much total debt are you guys in? So I've written everything down. So as it stands right now, on the business side, we're at $780,000 in debt, I know I have a PhD in being a Bozo. How much of that's credit card, how much of that is small business loans? So 165,000 of that is credit and the rest is split up between SBA, working capital and

5:21a line of credit. Okay. Because I'm just thinking the credit cards, you know, if you get behind, those will be easier to settle than some of these loans directly SBA loan from the bank. What does your wife think about this? What does she think you should do? She's not very happy with it, but she's been very supportive and very understanding throughout the process. So an absolute blessing to me, definitely not an added stressor, she's been an anchor for me for sure. Yeah, I mean, a little bit, Jimmy, but a part of me also is like, you guys aren't living in reality. Like she should be kind of flipping out. Do you know what I mean? I mean, I understand that the anchor of feeling supportive, but you're feeling supported in doing something that's continually getting you guys deeper and deeper into a problem versus saying, stop, stop where we are and we're done because we can't just keep doing this. The guesswork for what you're possibly going to do this year, I mean, you know what

6:22you mean? It's like you can't predict it. And so you guys either have to say, we're going to try to stick this out for a year with no more debt, no more debt. And if that means we have to close up parts of the business in order to do that, okay, just see if we can get some revenue in here. But you guys can't just keep digging yourselves in a hole and expect just to come out the other side. Right. Right. Perfect. So I'm going to put that down and you guys, I mean, you either need to make a decision. If you were to stop this completely, do you guys have things that you can sell off in the business? Like is there any way that you could gain any of this money back if you were to close shop today from like a real estate perspective or like, you know what I mean? Equipment you have in the business. Yeah, I have about $50,000 with equipment, but I think that's tied up in the SBA loan. They would have to, you know, I'd have to get permission to sell that off, to pay that loan down. Yeah. And that's why I was like worst case, you know, I really want to avoid bankruptcy.

7:22It's definitely not my first choice. And I even thought about getting like a job, like so I can just get some sort of income and then using that job to pay down the debt. But since it's a business, I don't really want to like create murky waters with me paying off business debt with my own personal income, but it's all tied to you anyways, Jimmy. Go back to the papers. Look who signed it. It's you. Yeah, yeah. I mean, it's all they're all going to come for you. It's not like car detail or LLC, well, they owe the money, not Jimmy, right? It's guaranteed by you. And so that's the, yeah, that's the hard news is you have to now picture this like it's just consumer debt that you took on. And so you're going to begin the business of cleaning it up. And I hope that you can find a new job that can create a better income that will allow you to clean this up faster. But if you just even sell a 50 grand worth of equipment, that's 10% of your debt you just knocked out. And so you got to start making progress. I would not sink more money into this thing just to be 600,000 in debt, 650, and hope

8:24we have less of a net loss. Ugh, I'm heartbroken for you, man. Thank you for your service to 22 years. That's incredible. I hope you guys can climb out of this. Thank you. With interest rates finally dropping, now could be the window you've been waiting for to buy a home or refinance. But don't just rush and blind. Sit down with someone at Churchill Mortgage who will tell you the truth and walk you through a plan to position you better for long term success. Listen, markets go up and down. That's nothing new. But the fact remains, building equity through home ownership is still one of the best ways

9:27for Americans to create safety and security in their lives. That's why I've recommended Churchill for decades. Their team of trusted advisors helps you build a simple, clear plan to buy or refinance a home the smart way. So don't let the market or headlines or experts on the internet tell you when you're ready to buy or refinance a home. You can decide that with guidance from a team who actually cares about your future. Go to Churchill Mortgage.com today and start your plan. Hi, Caroline.

10:27Welcome to the show. Hi, thank you for taking my call. Absolutely. How can we help today? Well, I recently found out that my husband's been misusing his fund money to pay for communicating with the prison pen pal. Oh, sorry. Did you say a prison pen pal? Yes. Like, is that a lady in prison? Exactly. Did he know her before she was in prison? No. I guess it was like some ads that popped up, he said on the site. So he got in the cycle and he stopped, but I wonder how do I move on from this financial and emotional infidelity now and trust? Yeah. Well, did he come forward with it or did you catch him? Where is he at with this? Oh, I caught him because I found some suspicious numbers on our phone bill and he had been

11:30like broke all the time, like just waiting for, you know, couldn't wait for that next like fund money to come, but he had nothing to show for it. So I couldn't figure things out, but those, yeah, I guess it's a thing that people do. And he was kind of like trapped in it because I didn't know. So he couldn't tell me he couldn't, you know, do his phone number. I mean, he just, no, he wasn't trapped, he was willfully doing this on his own volition. Yeah. You're right. You're right. Yeah. Nobody like was forcing him to continue this weird prison pen pal. How long was the, how long was the relationship for? Um, I'm embarrassed to say I didn't figure it out for three years. Okay. It's the same woman. Is this a scam or is this a real thing because it feels like a scam? So it actually is a real thing that people are doing like, I guess the purpose of it is to get people to get out and communicate, you know, so who's making the money that

12:34does it hurt? Everybody's paying. Exactly. So then they're, they're, um, so they, they use the money to put on their records or to buy things in their commissary or who knows what else. Like, I'm not really sure, but it, it kind of like funds their money while they're in prison. Like commissary money? Yeah. That is wild. Okay. Yeah. Well, that, yes. Okay. So, I mean, from the financial standpoint, Caroline, are you guys, well, sorry. Okay. Let me just back up for a second. When you found out, when did you confront him about this? How long ago was it, um, it's been probably in the past, I would say, four months. Okay. Are you guys working on your marriage actively right now? Are you seeing someone or are you, you know, going to therapy? What are you guys doing? So I was, I was going to therapy and we also had the complication that, um, we had a

13:36tree fall on our house. So we were dealing with a hole in our marriage, a hole in our house. So even if we wanted to like get divorced, sell the house, we couldn't because we're, and we have this mass of hole, right? You know, right on, um, I was talking to somebody and counseling and he did, I, I just, I was ready to get the divorce and I just said, Hey, would you be interested in going like to church with me, you know, sometime? And it was only because of his reaction of like, how excited he, he was to like try to go to church and know that I was, maybe there was a way that I was willing to like, to reconcile. Is he doing work on his own individually, um, just like through the church and I know we're going to do a marriage retreat soon. He, like, I talked to him about counseling, he's willing, but he's just like, it's just go dark. It's just, and I told him like, I need this in order to, he said, it's just so dark.

14:38Is that what you said? I'm sorry. He said, what was his response when you said that he needs to go to counseling? Oh, it's like the out, he's like, it won't be good. It's just so dark. His story, like what, what's in his head, like all of that? Um, I think just maybe of like the whole truth coming out, like I maybe only know a portion of it. Okay. I wanted to know like what did this person go to prison for and my faith, how long were they in prison for, you know, if you guys are going to move forward, everything needs to come into the light. Yes. Yeah. Yeah. Yeah. Yeah. It's a full, it's a full disclosure situation that you guys need to sit down with a counselor to even move forward. There's no way you, you can move forward with half the truth with your marriage. And George and I are not marriage experts. If Dr. John's alone, we're here, I think he would completely agree with us on that. Um, so yeah, so this is a, this is a rebuilding because of how deeply cut the trust has been in the marriage, right? I mean, for, for three years and in any given period of time, right, um, when a spouse steps

15:39outside the marriage, like that is, that is painful and that is, yeah, it's something to really, really be working on for both of you and the individual work for both of you. Having to learn to trust yourself again for him to face some of his demons and to understand what work he needs to be doing. I mean, yeah, there's, there's a lot of repair that has to happen regardless of if the marriage survives. So I'm just saying individually to be too healthy people. That's what you guys need. And then moving forward out of that, if you get the whole truth and you still decide, yes, I want to be in this marriage, then yes, then there's all the repair work within the marriage. But from an emotional side, um, it's definitely going to take some individual work. And then I would say from the financial, I would definitely have, I would be separating finances. Does he work and do you work? Do you both bring in a paycheck? Yes. Okay. And did we all sharing an account at the time when this happened? Um, we were, but because we were working the baby steps, he was doing it with his fund money. So he just was going, but where was the, but the fund money is it, is the fund money in y'all's checking account?

16:41Um, we would take it out cash. Okay. Okay. Right now we're at the point that I'm like, in order for me to trust, yeah, your fund money is going to have to be tracked, it tracked 100%. Yes. Oh, I think that's totally fair. And I would also pull his credit report and then freeze his credit on top of that. So we want to pull the credit report to make sure there's no outstanding debts that maybe you don't know about and to get a clear picture of what's out there and then freeze his credit. So he can't open any new accounts and that's just one stopgap to make sure that there's no more financial infidelity outside of what's even in your checking account. Okay. But I would have transaction alerts set up so you get a text message every time as sent comes out of that bank account, you get a transaction alert, even if it's just his account right now, if you separate. Okay. Yeah, because there has to be some steps, some visible evidence for trust to be rebuilt in the situation, Caroline. So that's not you being over controlling or like being his mom, right? Some, some marriages can function so dysfunctionally with money where like one person just has

17:44all the control and has to give anything and the other one doesn't know any passwords all that. I'm not talking about that. This is, there was a, there was broken trust within the marriage. Money was involved in it as it usually is and because of that in order to rebuild trust, I have to know exactly where the money is going. I need every account just like his phone records. I need every account of your phone records. Like there has to be a level of, of knowledge for you to keep moving forward in this marriage when it comes to building trust. Okay. And I know, I'm, I'm really tempted. I know he didn't, you know, I know he didn't steal money from you guys and all of that, but because it was allocated to him, but I, I mean, there's almost a part of me until you know that the marriage is going to survive this. I almost would just have my own checking account, Caroline, and then, but he has to be showing you his transactions out of his. I'm just scared that, that something else is going to come up and you're going to find

18:46whether there's more on the, on the infidelity side with the relationship or even more financially uncovering some stuff. Because you caught him and he still is not telling you the whole truth and that's the scary part is we just don't know how much more damage there is. And so because of that, I would just be on the cautious defensive side right now to protect yourself. Okay. And then action plus time plus counseling plus God, that's going to be the only solution to rebuild this trust and restore this marriage. Okay. Yeah, I'm so sorry, Caroline, that is like, it's so heartbreaking, so heartbreaking. And what's wild are these calls, George, we get, we get pretty consistently, whether it's a marriage that, you know, one, one of the two have, you know, made poor choices, but even from the financial infidelity side of taking money and doing things that this felt didn't know about, it's becoming more and more common. So again, yeah, the best line of defense Caroline is you work on you, he needs to work on

19:48him and you guys moving forward with all the truth out, decide what are we going to do? Tax season is coming up fast, which means a lot of you are paying more attention to your money and maybe realizing the holiday damage. So if you're trying to clean up the budget and start the year strong, cutting your phone bill is an easy win. With boost mobile, keep the phone you love and pay just 25 bucks a month for unlimited data, talk and text forever. No contracts, no traps, just predictable savings that help you stay in control. Which now at boostmobile.com slash Ramsey, restrictions apply, see website for details.

20:56Are you sick and tired of working so hard but having nothing to show for it? Well, that's normal, but also normal's broke so you don't have to live that way or every dollar budgeting app helps you find extra money every single month and helps you build a personalized plan plan so that you can get out of debt and start building wealth. It just takes 15 minutes and you'll find thousands of dollars in hidden margin. You're going to feel like you got to raise. So don't be normal when it comes to your money, live like no one else so later you can live and give like no one else. Start every dollar for free in the app store or Google Play. All right, let's head to William in Athens, Georgia. Hi, William. Welcome to the show. How are you doing today? Hi. We're doing great. How can we help? OK. I am 63 year old. I'm retired. I am debt free. I'm home on home and then with my wife, she's got about 20 acres that we own, you know,

21:58we don't offer anything good for you guys. And I have, and I have a large sum of money I have never invested in anything all my life except my 10% to the lower. So I don't know what to do for this money I got is just sitting in a plain old savings account. OK, how much money is it, William? It's a little over 400,000. 400,000. OK. And is that what you're living off of month to month? Or do you guys have good retirement or social security? No, I have a pension that comes in every month, which covers pretty much all my expenses, which my wife, they'll work and, you know, she makes a good salary. So you guys are living off of what's coming in, you're not having to touch this 400,000. That's right. It's just been setting a year after year after year after year, which now my pension is going into my savings.

22:59And it's been doing that for like four years and I've never touched it. So that's why I just keep building and building and building. And I don't know what to do with it. Are you calling us because you're ready to invest now? It seems like there was maybe a fear or a hesitance to do that in the past. Well, you know, when you come up poor, you know, you just always feared about taking big risk. But I had talked to the bank about, you know, maybe, you know, doing a CD and then they talked about why you maybe you can do another way and put it in an annuity. You know, I wouldn't do that. That's just some more expensive product that gives them more commissions in their pocket. That's the truth. Right. Well, right. And that was kind of my concern because that ties it up for three years, you know. Well, there's a way you can invest as money and have it grow for you because the truth is there is more risk of it just sitting in a checking account than there is if it's

23:59invested wisely because right now inflation has been eating up that 400 grand for years now. Yeah. You're probably having to kept up with inflation with the savings account because what you're making on that is what less than 1% sometimes in some savings accounts. Yeah. Yeah. So it's not even keeping up with them. Technically, in value, that's gone down, yeah, it's gone down in a sense. So yeah. So investing, I understand William, yeah, it feels, it feels risky. And I think there's ways that you can invest that is risky. And then there's ways that are very wise and yeah, and the risk is just not there, right? So if you're talking about like single stocks, if you're talking about something like cryptocurrency or whatever, right? There's more definitely risky type ways that you can put this money, but also there's a lot that is actually very safe because you can look at the history of the fund and be able to somewhat predict, okay, if the U.S. economy continues to do well.

25:04And again, some years is down, some years is up, but it's not this like drastic change over time. And you can kind of, you know, you really can look at the pattern over time and say, okay, this one feels right. And if the U.S. economy all crashes and burns and you lose all the money, I think there's probably more problems that we're going to have than just thinking about right that money in the account. So William, the first thing I would do is talk to an investment professional because what they can do is educate you and guide you and you can do that at RamseySolutions.com, click on start investing on our website and that will connect you with someone who can help you manage this money wisely. Have you ever read the parable of the talents? In the Bible, the parable of the talents. It's a great read. I highly recommend it. Go check it out after this and I hope it encourages you to steward this money in a way that helps it to grow so that you can retire with dignity, leave a legacy and even create generational wealth.

26:04Because if you just leave this money in an average mutual fund or index fund, it would double in seven years. On your 70th birthday, there's 800 grand sitting there and you did diddly. You didn't touch the money, you just left it. And William, I'll say this too, you know, we talked to some, you know, we talked to a lady, this was a few months ago, she was in her 90s and she was just scared to death to invest her money. I mean, it would keep her up at night. And I'm like, you know what, you're 90 years old, solve for peace. If that's the rest of your life, you're fine. You know what I mean? But you're 63 William, you got a long life to live. You could easily be living another 30 years. So I would, yes, be very much considering investing and go talk to someone that has the heart of a teacher, one of our smart investor pros because genuinely, and I want you to feel comfortable with it, okay? But I do want you to learn something new for how this money can actually, like George said, double in size, continue to grow so that you can leave an even bigger legacy versus living in the sphere of the unknown. All right, let's go to, is it Esmeralda?

27:05Beautiful name. And Sakura Mino. Welcome to the show. Hi. Thank you so much for having me. You're so welcome. How can we help? So I am a first time mom. My daughter is going to be turning one on February 23rd and I am planning to go to Miami for her birthday celebration because all my family lives there and my husband. He doesn't have family over here in California. It's just us. So I figured why don't we go to Miami to celebrate since my family out there haven't really had time to spend with her. The only thing I'm kind of wondering now is, is it too much money? Is it even worth it? Where's how much money we're making and how much money we have to eat and would it be too late to cancel? Okay. How much is the trip going to be total? So for the flight, I'm looking, we already paid for the flight, but we did get refundable tickets. But that came out to a total of 637 and 92 cents.

28:09Okay. And where are you guys at financially? I have, I mean, we have $7,700 saved and right now in my checking account, in our checking account, we have $1,300. Okay. How much debt do you guys have? Right now it's only $200. It's from a team that will payment that my, that my phone at the time opened the account under my name and we don't talk anymore, but it's just that bill, $200. We took care of the credit card debt when my husband said it was in today's Ramsey Inn. Good. Yeah. So no car loan, no lease, no student loan. None of that. No. I didn't go to college. Neither did he and he paid his car off with cash. Good for you guys. How much do you guys make a year? A year? Let me see. Just ballpark. 40, $45,000.

29:0940, $45,000 a year. Okay. And is it, is he just working? Are you home? Yeah. I'm staying at home. Okay. I'm working. Okay. Um, as Marla, yeah, I mean, it doesn't bother, no, I mean, because that's all you guys have placed, you're basically doing flights, you're going to stay with family, right? You're not going to have hotel costs or anything. No, we're seeing this family. Yeah. What is the birthday consistent? Right now, we're paying, or like a car rental, and I was going to purchase any bounce house for her with a ball pit and car parking. So when we drive to the airport, we can meet the car park there because we don't have family out here that could drive us. Sure. Sure. Yeah. I mean, I wouldn't. Okay. So I would, I would put this in the umbrella, like we're going to go see family versus making it a first birthday kind of thing, because that almost is going to add more expenses from

30:12the emotional side. Most should easily climb to two grand out of just, well, let's just have fun. Let's get the bounce house. I would just say, we want to visit our family. So either you can do that now with these plane tickets, you've bought them already. And so go enjoy yourselves, stay on a strict budget, or just say, let's pause and maybe go this summer when we feel like we have more savings in the bank. This is Dave Ramsey. We all want to know that the money we give to charity is doing something that matters. And it's making a real change, giving someone lasting hope. And here's one way to make sure of that, give to pre-born. They're the real deal, proven, transparent, and changing lives every day. I trust pre-born and you can too. They're on the front lines of the battle for life, partnering with clinics to offer free

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32:21The Ramsey show question of the day is sponsored by Why Refi. If defaulted private student loans have taken over your life, why Refi can help you breed again with a low fixed rate plan that fits your budget? Visit yrefi.com slash Ramsey. That's the letter Y-R-E-F-Y.com slash Ramsey, not available in all states. Today's question comes from Kathy in Utah. I'm 70 years old and considering buying a house with a 15 year loan. If I pass away before the term of the loan is completed, what happens to the debt? I'm not married and don't have kids. Why shouldn't I borrow $500,000 knowing I may die before it's paid off? Well, that's the spirit, Kathy. I mean, one just integrity, I guess. That's a good start, character. But the point of your question, if I pass away before the term is completed, what happens to the debt? Well, your estate quote unquote would pay for it. Which is any assets that you own, the lender would go after those first to try to pay down

33:24the debt as much as they could. And then I guess they would just take on the debt and move on because that is the understanding that when you die, your debt does not necessarily die with you to a point it does, but they will yes, factor in all the assets you have. So if you did die with credit card debt, car law, all the things, then you technically have owed that money. So if you have any money to your name or any assets, yes, they are going to deplete those in order to pay the debt and then whatever's remaining will go to family of your estate. But again, you're not married. The bank owns the house. So they'll sell the house for what they can get for it, use that money to pay off the mortgage. That's what they would do. The bank just got a free house. So I think they might have got the better end of the deal. But yeah, but also Kathy, what if you, what if you keep living, you know, you're renting at 70. I don't know anything else about your financial situation.

34:24Do you have a million dollars in cash or are you broke? We have no idea. But buying a house, knowing that you could live another 20 or 30 years is a good bet. And so if you are in a financial spot to do it, I would do it. All right, let's head to Dorothy and Manchester, New Hampshire. Hi, Dorothy. Hi, how are you? Hi, we're doing great. How can we help today? I need to know if I should do an additional $20,000 on a HELOC to pay off my car, which is at 12% and I owe 23,000 and I have one credit card at about $1,800 at 18%. But my HELOC is currently, I have $20,000 out on it because I had to have a emergency furnace. And it's only 6%. Long story short, I went through a bad divorce, it was homeless, I'm sorry, lost everything.

35:35My ex told all of our joint bank account, left me with $3. And I worked for the government for 20 years and I had to retire, move out of town. The new job that I have is lower pay, but since 2019, I've been trying to rebuild. And like I said, I got a house, bought a condo before the housing market. I have $100,000 necklace, about it to $1.62, it's worth now over to $2,000. How much are you making now, Dorothy, with your job? $1.27 an hour. Okay. And what does that come out to, like per month, what are you bringing home? Only like $2,200, $4,200, yep, yep, that's great. And that's enough to cover all your bills and cover the minimum debt payments. What I have is my loan is $1,223. My HOA is $300.

36:37My car payment is $4.64, insurance is $250. My lights are $100, $100, TV internet, $128, my phone is $45. So what margins you have left after all of that? I've been making all my payments and I've been also making my $157 key lock. And I've been putting $30 a week toward my principal of my mortgage every week, because $30 is, you know, a couple of copies or whatever, and that's all that I have is just that credit card and my car payment. Okay. So what I would say, Dorothy, the secret of getting out of debt is not moving debt around and trying to get a better interest rate. The secret is you. So honestly, you kind of getting into this next year, which you've already made incredible progress. Like the story you told us at the beginning of the call of, you know, being homeless, I mean, like, man. You're still standing with shelters.

37:39Yes. You have made huge strides. So no, I would not take hours to work and back. Yeah. Yeah. That's a long time. So what I would say is the magic of getting out of debt if there is, quote unquote, it's you. So you deciding, hey, I'm going to cut where I can. I may even take on an extra job. You have the work ethic and I'm going to clean this debt up. When you move it around, interest rate wise, over the long term, oh, if you had this for 15, 16 years, then yeah, we could probably talk about it, but you can actually, you know, the short term life of this debt because you're going to pay it off so quickly, I wouldn't fool with it. I wouldn't fool moving it around. And I think it kind of gives this false sense of security of, oh gosh, it just feels better that all my debts in one place or that it's a better, you know, interest rate here and there. But again, that's not going to solve you getting out of debt. It's going to be you. It didn't change any of the behavior. We just moved it around and put it in a different junk closet. And the other thing is you're moving from unsecured debt to a secured debt.

38:40That home is collateral. So it puts you at even further risk. And so like Rachel said, the solution is you and that means we got to get on a written plan. We got to get on a budget. We're going to save up $1,000 starter emergency fund to stop those ankle-biter emergencies. You have that in place. Do you have any other savings? No. Okay. What is the car worth? You owe $23,000. It's brand new. It's a 2025. Wow. Well, that might be something you could sell for a penny. Yes. Could you sell it for almost what you got for it? Actually, I got a three-month interval. So yeah, I probably could. Because what I'm seeing is that clears your debt journey in half. Yeah, because see, then I could put everything of that car payment and, you know, so forth towards the emergency of the HELOC for my furnishing stuff, but I mean, you still need another car to drive. So you'll need to save up a little bit of money.

39:40The new job that I have, yeah, the new job that I have, I don't, I live two minutes away versus four hours because, like I said, I was driving from Vermont to Portland, Maine every single day, working my eight hours and going back to back home. Gosh, well, that's not a sustainable life. I'm so glad that it's close. So you seem to go without a car for a short season? I can actually go with, I don't even feel my car maybe once a month, maybe once in a half. I'm just curious what caused you to buy it? Because of the fact, just, I wanted to have a car where I pay this off and that would be it. Gotcha. Yeah. Well, let me tell you, an eight year old, 10 year old Honda Civic, that'll last you another 10 years while you save on the side and then you could have a red car.

40:43Yeah. I wouldn't put the pressure on your next car to be a forever car. I really wouldn't. I think that that causes this debt and this $500 payment a month, right? It's easy to justify when you go, well, I'm going to pay it off and I'll have it forever. That's how we make bad decisions, financial. And then when you're in the tactical side of your month and you're like, oh crap, look at all this money going and look at how much debt now I've accumulated. So yeah, I would try to get out of this car, Dorothy, for sure. And it's bumping up against, we have a rule that you should, your car should not be more than half of your annual take-home pay and yours is there or so. You got a $25,000 car making 50 grand. Yeah. It's tight. So if I were you, I would, yep, I'd get rid of it, go buy something new, use if you need it. But maybe for a season, like you said, if you really can go without it for a few months, save that car payment. You free up 500 bucks, throw another 1,000 on top of that, you'll be dead for 18 months. 100%. Yeah, yeah. There's some, there's some moves you can make your Dorothy to really change it. But I wouldn't move the debt around in the heat lock.

41:44I would make some big changes like what you're talking about. And I know you can because you have in your life and you're incredible. So we are cheering you on. You know, every year I hear the same excuses for why people don't get the life insurance they need to protect their families. So this year, let's clear the air and look at the facts. Being 10 to 12 times your income on a 15 or 20 year plan is in many cases just plain cheap. That amount of coverage lets your family keep the lights on and keep food on the table while they're grieving. Second, life insurance through your work is not enough, especially since these plans go away if you change jobs. You need to have your own policy so you're not without protection when your family really

42:46needs it. Third, stay at home parents need life insurance, especially those with young kids. People don't realize how quickly the call sat up without someone at home taking care of things. So no more excuses, folks. Get the protection your family needs. Go to zander.com or call 800-356-4282. They've been my choice for all my insurance for over 25 years and are the only people I trust. Welcome back to the Ramsey show in the Fairwinds Credit Union studio. I'm Rachel Cruz, hosting this hour with Best Selling Author and my co-host of Smart Money Half-Hour George Camel. Honored to be here. We are here to take your calls. It's a little different than Smart Money Half-Hour. Different vibe. We don't take calls on Smart Money so that the vibe is generally a little more positive

43:48and upbeat because people aren't going through crisis on the show. I know. That's why we're here, though, for this show to help you with your problems to celebrate the victories. So give us a call at triplate 825-5225. All right, to kick us off this hour in Salt Lake City, we have Phil. Hi Phil. Welcome to the show. Hi. Thanks for having me. Absolutely. How can we help today? Well, it's recently come to my attention that my oldest brother has been stealing money from my parents. Oh, cool. So it started off as borrowing gas money has turned into lying his way into a massive car loan in my mom's name, stealing credit cards without my parents' knowledge. And so my parents have more than $100,000 in debt now. And that's not even including their mortgage. They're both almost in their 70s. My mom's on disability. My dad has $40,000 in his 401k and they think that's a lot. And I'm just, I just don't see a way that he's ever going to be able to retire.

44:49And I understand that me and my life are not financially responsible for them, but I'm trying to walk through this with them, but I'm no expert. And every time I learn more about their financial situation, I see less and less of a solution other than bankruptcy. Right. And so what should I tell them to do? Yeah. So two different paths. I mean, if you're going to go like, full on, he has stolen, did he, um, did he forge signatures like for the car loan? How did that happen? So if, if, from what I could gather, it seems like he's lying to my mom on what she is signing and then gets her to sign something without her reading what it actually is. Well, crap. Because I was going to say. So they took this to court. They'd like, man, that's your signature, right? And she's like, yeah. But I just didn't read the document. Yeah. And that's her fault. I know. I mean, dude, I'm saying like, there's a level of responsibility that she did not take. I mean, it's really elder abuse is what this is. That's probably your best case. Exactly. It's fraud and elder abuse. Yeah. If they would, yeah, if they would take legal action, that's what it would be, um, but

45:51I'm scared for a court. I don't know. Yeah. I mean, first I would freeze their credit yesterday so that no more accounts can be open. I would also contact every lender on that credit report and say, hey, this was fraud. This is elder abuse. This guy took out all of these loans without the permission, you know, he basically coaxed them into it. And so then we go from there. I mean, do they still have contact with this brother? Do they know about this? They know about it. My mom just had a stroke last week. So this is all adding to it. Goodness. My God. This dude is like the scumburger of all scumburgers to this to his own parents. Yeah. Yeah. And we're trying to find him right now. He's been on crystal meth before. So I'm not sure if this is having that involved again. So we're trying to find him and figure that out because he has the truck. He has, there's also an RV that has $250,000 on it that I think is in his dad's name.

46:51It's a whole deal. So I just, and I'm worried that my parents aren't going to file any kind of charges. Yeah, they may not. Hard to. Yeah. Just one son. You know, I get that. Well, I think they need to understand if they don't pursue this, then they might just be on the hook with us for the rest of their life. Yeah. That's the scary part. And so. And it's a loan, and it's a loan fill, right? So the problem is, too, if, yeah. So if he stops paying and that truck gets repotent, all that's in your mom's name. I mean, it'll all be on her. They're going to come after her for it. Is he even making the payments? He's not made a single payment, though. So I mean, are there, have they repot this? I guess you don't even know. He does still, he does still have the truck. Not for long. I mean, yeah, I don't know how long he's going to have it for, but like I call the repot man myself. Yeah. And if you can find him, so he's disappeared. Well, he turned off all of his location services once he figured out that I knew you're

47:57on to him. Have you found the police report? I believe I told my mom that she needs to. I don't know that she has yet. I actually found his location this morning through his daughter. And so I'm trying to, I'm trying to figure out what I did to you, but yeah, okay. So the hard position you're in and correct me if I'm wrong. It sounds like you are doing all the proactive work in this situation. You're worrying about your parents. You're trying to find your brother. You're telling your parents what they should do. Like, you're kind of the one heading up all of this and none of this is your issue. I understand your parents and you love them. So like, I'm just saying from a top tier perspective, the hard place that's going to happen for you, Phil, is you're going to have a wonderful logical game plan because you're a smart, reasonable person and you're going to say, Mom and Dad, you need to do A, B, C, and D. Brother, they're coming after you for these charge and this and this and this is going to happen. You're going to have a plan laid out of what should be happening and in any common sense

49:00scenario. And the problem is if they choose not to move forward, that's their fault. So you know, that that's their decision. It's not yours and you can't make them do something or even convince them to change their mind. So I think it's going to be a discouraging situation for you, Phil, here in the next few months because I think you're going to realize my parents are probably naive because he's been on drugs and still are signing papers for him, right? I mean, I would be going through a, you know, going through like, oh my gosh, so detailed if that was me, but they need to be as angry as we are. And they're not. And they're just like, well, I guess it is what it is, like what is there in response right now? What's their attitude? Well, I mean, my mom feels horrible that she didn't see this coming sort of thing, but she doesn't really have the help to take this on. And my dad has not done anything financially in their entire marriage. He just doesn't know anything about it. He doesn't want to know anything about it. And I'm like, I know that I'm going to have to, you know, eventually most of the time

50:04they sign off their finances to their children to take care of them. But I'm like, they haven't done that for me yet. So I can't, I can't do anything of that. Right. Right. So your dad is just sitting there. Well, yeah. All this is being honest. I don't know that my dad even knows to the extent of how much debt he has. He just goes to work, makes the paycheck and comes home. That's all he ever does. Yeah. Yeah. My mom has always handled the finances. And now she's, she's learned about some of this stuff in the past and hasn't told my dad about it. And now it's blown up to play more than I thought it would ever be. Yeah. How much debt are they and personally besides all the stuff that your brother brought in? I would say not including their mortgage. They probably have anywhere from like 15 to 20,000 and not a car loan and various credit cards. Okay. And how much are they making a year? I don't know. Exactly. Yeah. My guess would be anywhere from like 60 to 70,000 because it's just my dad and my mom is

51:07on disability. Okay. Yeah. If you're going to be involved, you're going to have to get financial power of attorney to actually make any moves. And that might be wise based on how things have been going with your dad not being involved. Mom had the stroke. I think now's the time to have some really hard conversations about the future. Yeah. So I think Phil, I mean, because I feel that burden very in the sense of like, you see what's going on and they don't. So I almost would just have a meeting, sit them both down and tell them, hey, this is exactly what the situation is. I need to know numbers. So I want to be able to help you and let's make a game plan and then it would be up to them to be the ones executing it unless they want your help in doing so. But I mean, I would give a latch, you know, a last ditch effort to try to do what I can to help them see and know what's going on. But unless they give you the power to do something, they're going to have to be the ones that, you know, make those decisions and I don't know if they will. And that's hard. It's very, very hard.

52:14I love entrepreneurs, don't forget guys, I started my company on a car table myself. So I know what it's like to have people counting on you, your team, your family, not to mention your customers. And when you're the one signing the paycheck, you can't afford to fly blind. But I'll be honest, early on, one thing that nearly sunk us was wasting time with spreadsheets that didn't add up because business units didn't talk to each other. I finally told my team, just fix it. And they did. We got NetSuite. That was years ago and we've never looked back. See NetSuite isn't just for tech giants, it's built for growing businesses like yours. Over 43,000 businesses already run on NetSuite, including a lot that started just like you. And now with built-in AI, NetSuite is helping them even more. It's one system connected to every part of your business for real time insights. That guesswork, NetSuite AI flags, inventory issues, cash flow risks, even supplier delays

53:17before they become problems. So you can trust the data, stop wasting time, and make the right decisions faster. Take a free product tour today at NetSuite.com slash Ramsey. That's NetSuite.com slash Ramsey. All right, let's head today in Charlotte, North Carolina. Hi Dave, welcome to the show. Hi, thanks for taking my poll. Yes, absolutely. How can we help today? So my wife and I are planning on to retiring between three and five years. And I just feel with our total portfolio that we're a whole heavy, we always have planned

54:19on downsizing once we retired. But I'm wondering if you think we should do that now and then invest that extra money. Okay, yeah, how much, how much is the house worth? 650. Okay. And how much mortgage you have left on it? It's paid off. It's paid off. Okay. And how much do you guys have in retirement? Well, it's 650 right now. 650. Okay. And how old were you guys being five years? I will be 67, she'll be 65. Okay. What's your game plan currently to retire? Because the house obviously is not going to produce income in retirement. It's great to have it paid off. But I'm proud of you guys for doing that. But what's your current game plan, regardless of what happens with the house? Where we're going to get our funds from? Yeah. Well, from the 50, which will grow, plus I have a small pension and then our social security. Okay.

55:19So between pension, social security, and then on top of that, you'll dip whatever else you need. You can dip into that retirement nest egg. Great. Okay. So you're saying, do you have too much tied up in the house? Are you guys wanting to downsize anyways? Yeah. We always plan on downsizing and then maybe we could clear 600 on this. And I know I can find something for 400. So that gives us 200,000 to throw in there. That would give me some cushion. And so I would be doing that if you're going, hey, I don't know that we can make it for the rest of our life with this nest egg, plus the pension and social security. I think it would be wise to sell, use any profits to invest, to then create a little mini nest egg on its own. Do it now versus wait until we retire. I mean, you can wait. You'll, you know, either way, the house is appreciating, right? As time goes on, your nest egg is appreciating. And so it's okay to wait. This is not, I wouldn't say this is on fire.

56:19But the sooner you do it, the more less variables you'll have. You'll kind of have more on paper to know when you can retire. Sure. Okay. Great. That makes sense. Yeah. Dave, how much will you guys be getting in a month with your pension and social security? At that point, that's four, 52, 62, about 7,000. Okay. And how much do you guys need to live off of per month? We figured 84, so that would be about that. Okay. Yeah. Well, that's great. Yeah. I was going to say, because, you know, when you do, when you do just the quick math, let's say you added 200,000 to that, that would be $850,000, and you just think every seven years it doubles if you don't touch it, which you guys will be retiring in five years. So it's a little less than that. But I mean, you'll have upwards over a million, for sure, by the time you guys hit retirement age. And that in a paid off house. So if you're, if you're taking out, you know, your 18 grand a year to float the difference, you're talking 1% of your nest egg.

57:21And so it's going to grow in perpetuity, you know, the balance will continue to grow. Yeah. You guys will be good. I'm not concerned about that at all, with your current plan. Right. And if you love the house, you could probably stay in and still make this work. There just might be a few sacrifices down the line, but I think you guys will figure that out. The pension and social security. That's awesome. For sure. Absolutely. Thanks, Dave, for the call, and well done. Well done. I mean, yeah, right there, baby steps, millionaires, you know, they did it. You can retire. Awesome. With a paid four house and some money in the bank. So great. All right. Let's head to Isabelle and Spokane, Washington. Hi, Isabelle. Hi, guys. Hello. How can we help today? My question for you guys is that I'm on baby step number two. And I have about $1,900 in credit card debt and I'm K on my car loan and I'm wondering if I should take all of my investment in stocks, which total to be about $6,800 and pay

58:22off my credit card, knowing that I don't have any retirement at this moment. Are is the, what are the stocks are they in? Are they in like a 401k or your Roth or just single stocks out there at the 6,800? Just single stocks that total up to 6,800. Okay. Yes, I would. I would cash those out because how old are you? I'm 25. Okay. Yeah. You have plenty of time for retirement and the $6,800 is going to be better spent value wise by getting you out of a hole financially and helping pay off this debt. And then you'll be building up an emergency fund. And then Isabelle, you'll start investing 15% of your income, which I think you're going to be able to do here in the next, you know, 18 months, two years. Yeah. What's left on the car loan? Just under 9,000. Okay. So you got 16,000. I make 60,000, roughly 63,000 a year. Amazing. Yeah. So after you cash it out, you'll have to pay some taxes on some of it. But, you know, let's say you, you know, could pay it off and you're around 10 grand.

59:26You know, you could make it a goal to pay it, pay off that 10 grand and go leave five months. Yeah. You know, four months. Get aggressive. Get aggressive. Get an extra job. Pay it off. Then build up an emergency fund. If you're, are you single? I am. Okay, yeah. So I would just do a three month emergency fund, whatever your expenses are, just multiply it by three and just say, yep, that's my emergency fund. And then when you start investing, if you start investing by the time you're 27, 28, it's going to be, it's going to be unbelievable. Let's say, let's say pretend that, yeah, George is getting his calculator for us. So let's just say you stayed at 60, $63,000 a year is about what you want to your income will grow over time. Right. That's an amazing income right now. That's going to be, um, what is it, $6,000, $9,400, $787 per month, that's what you would be investing. Let's say by, by Christmas, if you can get through this plan, get rid of all the debt, get the emergency fund, then you can begin investing.

1:00:27You have zero in retirement, right? Correct. Okay. Get ready for this. Let's go. Should we go 26 to 60? When do you turn 26? Um, in August. Perfect. Okay. So 26 to 66, you would have $5 million, and that's based on a 10% return, which is what we've seen in the stock market for the last several decades. Okay. Yep. So you'll have $5 million. That's the power. Five million bucks is about, you'll, you'll be granted. And if you want to retire 62, you'll have $3.3 million. Okay. And that's if your income doesn't go up. That's if you never get a raise, you're holding it. That's crazy. Like that's so wild. And then you're going to, you know, maybe meet someone. You're going to double the income. You know what I mean? You just keep it going. This life goes. Get a house. Get the house paid off. Invested more. So you're going to be a multi-millionaire if you stop playing the game of a broken financial system, which is I got to get a credit card to get a credit score. Whoops. I carried a credit card balance. Well, I guess I need a nice car. I have a big girl job now.

1:01:28I got a payment to go along with that. If you can just put blinders on and not care what anyone else thinks about your financial plan, you will be unbelievably wealthy. Awesome. Well, thank you guys. Well done. Yeah. That's always, it's always an encouraging call when you get someone in their early 20s and you're like, look, you still have so much time. You are so much time. I mean, seriously, like it is, it is wild. And not that, you know, those of you in your, you know, 60s and 70s, like start now, right? If you've not started. Like there, there's always the point to start. But especially young people out there in your 20s, man, the, the idea of compound interest is insane. Like the amount of money that actually went to principal, does it say that George? Well, it shows you how much she contributed. So yeah. We'll go with our example. 26 to 66. So a 40 year period of you investing, that's 787 a month. In that, she would contribute 377,000. That's so much of her own dollars went in there and the growth was 4.6 million on top of that. So that's what's crazy.

1:02:28So the earlier you start, I mean, honestly, it's, it is wild, but it does it over 90% of that nest egg was her just investing and leaving it alone. Yes. But it's the consistency month after month, regardless, we are doing this. We're not letting up. It is just a rhythm of life now when you get to that point. It's just part of it. You don't stop. And then in that, you know, you don't get caught up. I don't think in all the, the lifestyle creep and all the thing. You know what I mean? Like there's so many things I can take you off this plan that look shiny and fun and exciting. And you can still have a great life while doing this. But it's just having the maturity to say, you know what, I'm going to put some things in place to assure that when I am in my 60s, I'm taking care of. And by me, not by the government or waiting on something else that, that you do it. And you have the power. Ever not there, you have the power to do it.

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1:05:58what this could do. Vanderbilt research found that a 10% cap would save Americans a hundred billion dollars a year in interest. I mean, think about that. The nation is 1.2 trillion dollars in credit card debt. That's wild. So 10% means the credit card companies will only make 120 million dollars off consumers this year from the interest alone. That's not swipe fees. That's not annual fees. So let's do the math. You've got a $5,000 balance. You'd pay about 42 dollars a month in interest at 10%. But at 24%, which is close to the average, $100 a month. So that really would help a lot of Americans who are struggling with this credit card debt. Yeah, but the reality is. But the reality is he can't do that. You can't just truth it into existence. Nor should he. This is when presidents decide in free market economies to start doing things like this and forcing free markets to do things. You get Venezuela. You get Cuba. So everybody just needs to understand this all sounds good until you look at the constitutionality of it. Is it

1:07:03a free market policy? That's first point. But I tell you what came to mind when I first saw this. As you guys know, I play a lot of pickleball. Play for three hours tonight. Thankfully, my knees are in good shape. But the knee analogy came to mind when I heard this. If someone has a torn meniscus, you can get away with not having surgery and you might put a knee brace on. And the knee brace is somewhat helpful. So George, you just laid out beautifully how 10% at a cap would be very helpful. I don't want to gloss over people that are hurting right now. I don't want to be insensitive. Yeah. So it's like a knee brace. Yeah. But here's the thing. The meniscus isn't going to heal. The knee brace just helps a little bit. It doesn't solve the problem. And this doesn't solve the problem, which is Americans have a taste for debt. And it's not going to solve the problems. The debt snowball solves the problem. The baby steps solve the problem. Lowering your interest rate doesn't solve the problem. How many times will we get a call

1:08:04like should I move my debt around? And we so for that reason, this feels like politics to me. And he has every right to tweet or truth or whatever he wants to do. It's I think it's posturing. And I did this when Biden was president. I don't care who the party is. I'm going to call strikes. I'm going to call balls. And this isn't going to solve the credit debt problem. Yeah. It's just not a good reminder. This is for one year. So this cat would exist for one year. So then what? It's not law. It's not he's not even executive order. He can't do that. It would have to be Congress rewriting federal law. There have to be a bill in place. Everyone has to agree. Which I'm for that. If Congress does it. And we're talking about banks, which make billions and billions of dollars, they're going to find a way to get their money. Well, what they'll do is raise annual fee. They'll fee you to death. Yes. And they'll make their money elsewhere. Banks are not like, oh, you're right. You know what? That would help people. 10%. We didn't even think we didn't think about that. Thank you, Trump. It's so right, Rachel. You know, they have so much money. They're the best lobbyists in the world. Do you think that legislation is going to pass? No. And of course, here's the best part. JP Morgan's

1:09:09CFO. Of course. This is going to hurt people. Guys, we can't do this. This is going to hurt people who need credit the most. Because what this means is tighter lending. These credit card companies aren't going to lend to the subprime borrowers. And so he's saying it's going to actually hurt everyone. Oh, you two are going to love this one. You're going to love this one. I saw this on Twitter. Yeah. By the way, refuse to call it out. Thank you. Somebody came out. The day that this was this came out. I saw this. They were like, well, what people don't realize is if they lower that interest rate, how where do you think all the points come from? It comes to which is right, by the way, yes, the point system and the airline miles, all of it who aren't paying their debt off in every month. They're paying 22% and that's where the miles and the whole. What's going to happen? They're going to slash rewards that devalue your points. Guys, the banks are smarter than you. There's no free lunch. Have you ever heard that phrase? Yes. Yes. There's no free lunch. Yeah. Only way to make this better is to pay off the debt. Like we preach. It's to get rid of it. It's so true. Here's a fun fact. Credit card rates are protected under federal law. It's called

1:10:09National Bank Act. It's locked in by a Supreme Court ruling from 1978. And what this does, the ruling, this is crazy. It lets banks charge whatever rate is allowed in the state. They're based in. So guess where credit card companies go? Delaware and South Dakota, where there are no rate caps. So they can just go. It's like a loophole where they go. We can charge 36%. So Delaware and South Dakota are the only two states in the country where there are no caps. No rate caps. And that's where all the credit cards override that without Congress will be writing federal law. And so there's no bill right now, which means it just. And the reason that passed in the 70s was what to give the free market and the banks to be able to to have a free market economy. Do you know what you mean? I do know what you mean. The reason I'm pausing is I don't want to misspeak. Yeah, yeah. Because I'd have to see. We'll have to look at the history. I always assume Ken honestly has any answer to any history. He's like, he's a legislation. Well, I can theory, I can say that this is where lobbying comes in. And the banks convinced Congress. And you know,

1:11:12I mean, that's why we call here's another dumb question. If there if that is just platforming, if Trump really cannot do that by law to go in and what causes him to come into the headlines and to to throw it out there just to stir the pot. The same thing when he says and Winks Winks and says he might run for a third term. Yeah. Says whatever he wants to say. Well, I know, but I'm just showing. And so that's why I have it. But I'm just saying is it is it was there something else stirring that is like, yeah, yeah, yeah, the midterm going to be kind of midterms. I mean, okay, let me tell you this. The number one buzzword in politics in America today. You guys know what it is? Tell us can affordability. Oh, yeah, both sides of the aisle. It is going to be the issue in the midterms. And and so presidents do this. I don't begrudging for it, but that's why I did it. By the way, it's probably three in the morning. He probably just had a filet-o-fish sandwich, you know, brought to me by secret service. The guy never sleeps. Yeah, you don't even know. And so he just gets on truth and he's like, oh, this is a good idea. Yeah, let's stir some things up. Let's see what happens. What should be anyway? This sounds

1:12:15good. Yeah. And, you know, and I will say from my seat, the banks do screw people, but also we have chosen as a country as a consumer base to get into this amount of debt, right? Nobody. That's right. Nobody torches you and forces you to sign for the car loan or the credit card or whatever, right? We as adults, if you're over 18, have chosen to put your signature on something. That's true. I don't begrudge the banks. You know why? The banks are just like the guy in the key asking them all, where I'm walking by with my wife and he's like, hey, hey, hey, hey, try this. You have every right to just pass by. And I can ignore him or I can stop and get sucked into it. And then the whole let the whole spiel sell me on whatever. Now can't start with face lotion all of a sudden. All right. There you go. I want to see this. I'm with you. A new keychain. But like you, I'm validating your point. Yeah. Banks aren't bad. Banks are in the business of making money. Yeah, but they do pry on people. They know, they know the tactics. I agree. But I'm saying we. Let's get some personal responsibility. Right. Right. Which is, yeah, what I was saying. By the way, Trump threw out the 50-year mortgage,

1:13:16too. So then he's just throwing stuff out here just to see what's. What was the math on that one that you did? It was like a million dollars in interest or something. But was it crazy? Yeah, wait, you essentially never pay it off. The principle doesn't go down until you're 41 years into the mortgage. Yeah. That's when you, that's when more is going to principal in interest. 41 years into a 50-year mortgage. Yeah, it's crazy. Wild. So yeah, folks, I would say don't get your financial advice from presidents and or the banks. Take away. I would I would pay my credit cards off today and cut them up versus waiting and hoping that maybe the rates will go down. And so I'll hang on the banks. They don't care about your financial piece. No. And that's fine. The politicians. They're not going to solve your debt problem. And the system is designed to keep you dependent on lenders and on lawmakers. So the best part is you don't have to be dependent. You can break free from the system and just say, ah, I'm going to use my own money. What's in your wallet, George? A debit card? I thought you were going to say cash. And cash. I don't want to fit. Uh, Ken, thanks for jumping in the last minutes. So you guys are the best. Thanks.

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1:16:52to find a Ramsey trusted real estate pro for free. Go to Ramsey Solutions dot com slash agent or click the link in the description if you're watching on YouTube. We're listening on podcast. Little share Ramsey snuck out there. Hey, I'll be right. She'll help. Oh, you know, you can take the accent out of the girl. I just can't take. Well, they're the girl. Whatever they say. Yeah, whatever that that saying is all right. Let's head to. Is it Ali? Would you go Ali or Ali? In New York, New York? Yes. Hi, Ali. Welcome to the show. Thank you. Thank you for taking my call. Absolutely. How can we help today? I just had a simple question. I run a company here in New York and I have a lot of independent contractors. They work with me. They have their own vehicles. So I have right now only one driver that drives my car, which lowers my expenses. But the question I wanted to ask is if it's okay

1:17:54for me to buy another vehicle and hire another driver, which is going to obviously add another car payment and insurance and the drivers pay on my payroll. So that's the question I want to ask is should I keep using the independent contractors or buy another vehicle and hire my own driver? Yeah. Well, if you're going to go through the avenue of debt, oh, yeah, I would say, yeah, no. I would say you're not financially ready to do that because from a financial perspective, even with small business, we always say move at the speed of cash. If you have the cash in order to do it, if you have enough revenue, profits coming in that you know, okay, yes, I have the ability to pay someone full time, save up for a car. Like all of this is going to be streamlines. Then, yes, I would. Until then, I would not. But I think that could be a great, you know, next milestone for you. Because I do know, you know, the car service, you know, world in New York. I know it's there's a lot of need out there. Right. There's a lot of people that use car services. So I do think

1:18:55that your ability to make money is there. And I just wonder if you make it more of a goal than like an urgent implementing something quickly. Yeah, I mean, because I was doing the math, it's going to add at least, you know, 10 grand on my, you know, monthly, including the, you know, drivers pay and the car payment and the insurance. So $10,000 monthly is going to add. That's the expense for you. For one adding here, because the vehicles we use is the Cadillac S-Glaed S-Ruby, we buy a lot of high-end business executives and we did about 1.1 million last year. And is that top line gross? Yeah, that was the top. Okay. What do you take home from the business? Approximately three, 15 to 400. Oh, amazing. Okay, Ollie, hit me straight. Could you save up and buy one of these in cash? May buy one used? Get a deal. And then it's pure cash flow.

1:19:59Yeah, I mean, the one thing I think the only option I'm going to have to go to as you're just said, maybe you have to save money to buy the car because if I buy a used vehicle, what's going to happen is they won't give us the warranty, which is 150,000 mile warranty. We normally get done. We get a new vehicle. So because we run these cars for a long time, we put a lot of mileage on it. So if I buy a used one, it's not going to have that warranty. Sure, but you could self-insure at this point with the business. I mean, you can create your own warranty fund and put 500 bucks a month into a pot and go, all right, we're going to cover maintenance and repairs with this money instead of paying the fees for the warranty. Because what you're doing is you're destroying these vehicles by using them for business, which means you're likely underwater on that car pretty quickly. You owe 60 grand. The car is now worth 40 because you already have 100,000 miles on it, whatever it is. And so it's actually putting you at more risk by buying those

1:21:00cars with a loan. And so I would encourage you get a deal by one used. They're still nice cars. Yeah. Even a five year old escalator. I'm not going to go, well, it's not a 2025. So I'm not going to ride in this vehicle. You know, it's about the service you provide. It's clean. It smells good, right? I mean, it's all that. And so if you run this, do you have any debt tied to the business right now? Yeah, right now, the only debt I have is the rich, you know, we have brand new two brand new vehicles. It's close to 130, 130,000. Okay. How quickly could you pay that off? I can pay that off. I would say within six or eight months. Cool. Amazing. Think about that though. If you got rid of all the debt and then you began to cash flow any future vehicles, run the numbers on that. And not only will I think you're going to go, oh my gosh, this is amazing. Yes, it's going to take a little bit of delayed gratification right now and sacrifice. But the long term is you survive in this business 10 years from now because everyone else is over leveraged underwater on their car loans. And you're going to sweet.

1:22:02I got six escalators paid for and cash. Yeah. And what's crazy, Ollie is George and I, we were in New York City March of 2020. Literally the day they were shutting down Broadway all of it because we were there for a media thing right when COVID hit. So my thing is too, you know, whether it's, you know, it's something like that. I mean, who knows what could happen where everything just stops, right? Business for you guys in 2020 through 21 probably just ended, right? I mean, it just was done. And so there's still a level of, yeah, a level of risk that you carry when you carry debt. And especially since yours is so dependent upon, you know, other people and even, you know, I don't know if it's just execs that you guys, you know, do this car service for or other people. But there's something to be said that if for some reason business just stops when you don't have debt, you have a lot of peace, a lot of peace. Thanks for the call. Ollie, I hope that helps. All right. Let's head to Ethan in Columbia, South Carolina. Hi, Ethan. Welcome to the show. Hi guys, how's it going? We're doing well. How can we help today? Well, it's kind of a compound question, but I'll keep it brief. My fiance and I are going to

1:23:07get married in June. Yeah, congratulations. Thank you. Thank you. It's been a long time coming about a two year engagement. Oh, good. Yeah. So we have our human paid for, we have our wedding paid for just a couple of expenses here and there. But we're wondering, should we rent first? Should we buy first? We have an opportunity to live with family, but I'll explain more of that in a bit. Okay. Yeah. My, my kind of go-to answer usually, Ethan, is if you guys are not, if neither of you are homeowners right now, is that right? Correct. Okay. So yeah, starting off like that, I would definitely just rent rent for a year, get settled, get an apartment, like just kind of just, you know, have that save some money. And then when you look up and say, okay, we do have enough to put a down payment, you know, which is 5% for first time home buyers is what we recommend on a 15 year fixed rate. And mortgage, you know, it may take you longer than a year to save, depending on where you guys are financially, you know, what you guys can put away. So I would not buy a home until you have that until you're financially ready. So in the meantime, I would be renting.

1:24:12But even if you were financially ready, there is still part of me, George, and I'm like, you know, still wise. Yeah, just rent for a year. I'm curious, Ethan. I see the word debt on my screen. How much debt do you guys have? We have, I did the math while I was on hold, it's right at $89,000. Oh, I didn't fix it. That is student loans. For me, 30 is student loans for her and then 23,000 on a vehicle I used. Okay. What's what's going to be your household income once you guys are married? For a month or total total per year. Total per year. I currently bring home around 70 or 70. She's about to graduate from nursing schools. So it's kind of hard to guess. But that's a probably around 60 to 70. Okay. We all make it a good income. Yep. So that you have a great goal while you're renting, which is clean up the mess. Yes. And aggressively pay off your consumer debt, which means we're not going to do any investing. We're not going to live the like crazy newlywed life and go get a bunch of stuff and go on all these crazy trips. No, we're living on $40,000 a year.

1:25:16Tell yourself that and then throw that throw that hundred at this debt and get it paid off. You know, I mean, you guys could clean this up in one year, Ethan, which is so amazing. And then beyond that, you know, building up an emergency funds and then saving up for that down payment, which again, you guys have a great income. So you're going to be able to do that. Don't get tempted because everyone goes, well, you're married now. You need a house. You need a house. Go buy a house. They don't pay your bills. They don't know your stress levels and it's going to add anxiety and stress to a newlywed's life if you do it before you're ready. Well, come back to the Ramsey show in the fair winds credit union studio. I am Rachel Cruz,

1:26:20hosting this hour with my good friend, bestling author, George Camel. And we co-host another podcast, Ramsey Network show called Smart Money Happy Hour, so make sure to check it out. All right, give us a call at AAA8255225 and we're here to answer your money questions and any questions about life, you know, sometimes money definitely is integrated into our relationships, in our jobs and careers and all the things. So we are here for you. All right, let's go to the phones and we're going to go to Chicago, starting us off and Brook is on the line. Hi, Brook. Hi, thank you so much for taking my call. Absolutely. How can we help today? So my husband and I found ourselves in sort of a unique situation last year. He had just graduated from dental school and we moved to a small town in South Carolina where he worked as an associate dentist at a practice that essentially was committing insurance fraud, drilling on things that didn't need to be done. So after about a month or two there, we reassessed our

1:27:24options and realized the best that was to move back to Chicago where I'm from to live with my parents while we finished out our lease, our town home there. So the original goal when moving here was to try to pay off as much as our student loans as possible. I'm a physical therapist, he's a dentist. We both combined have about 600,000 student loans. Wow. Over the past year. Wow. Oh my gosh. Okay. Okay. So over the past year we were able to pay off. I think moving here, I think I had approximately 140,000 in student loans. We were able to kind of light that out. So now it's been a year living here. We've been with my parents. He still has his 420,000 in student loans. And so I guess the next step, like I'm just calling in and get some wisdom on, you know, we've stayed. We're still in a good relationship with my parents, but should we continue to live with them, saving up for potentially a down payment on a home? Should we be looking more into

1:28:28renting for the time being for you guys? How much are you guys making a year? So his, he's a percentage of production. So his is approximately, I would say probably 140,000. 140,000 since he's an associate dentist. Yeah. Okay. And what about you? And I make approximately 90. Okay. And do you think, oh, sorry. Well, yeah. So you guys living with your parents, you basically, if you lived on nothing, then you should be able to pay off this in two years. Correct. Okay. With his, I mean, for his, for his loans. Well, yeah, you guys are, yeah, I mean, at 250, if you guys, if you lived on 50,000 a year, which is plenty because you don't have rent or you're not paying utilities and stuff, I'm assuming you got $200,000. Do you still have debt on top of his 420? So it's next month, we will have paid off my loan. Okay. So yours is done. So the 420 is left. Yeah.

1:29:28So if you guys had two years where you put $200,000 a year, that's 400,000. And then, you know, you're working a side gig or whatever. You guys are making 20,000 extra out between in those two years. You guys could have paid off. Yeah. I would be busting it. I would make it my goal to get out of there as soon as possible. I'll say it that way. Don't let this be a hammock where you go, well, we're comfortable. It's going to vacation. Let's get a nice car. We have no expenses. This is great. No. No. You see where I'm going with this? Because that's the real situations we hear from when people go, I'm living with this really happened. They were living with parents to pay off their $10,000 in debt. I asked them how much debt do you have now? $40,000 in debt. They went into debt while living with family because they got comfortable. And Mike, I guess we're trying to move out. I guess as soon as possible. So we're looking maybe in the next few months here to try to move out. And what is rent cost in your area? It's about $3,000 a month. Okay. So you'll be $40,000. It will slow you down by 36 grand a year, essentially.

1:30:31I would. And he accumulates about $2,500 to $3,000 a month in interest on as long as. Oh my God. That's your rent right there. That's worth knowing. Yeah. Yeah. I would be busting it to make $300,000 this year and throw every penny at the debt. And maybe you guys get on a game plan with with your family and go, Hey, here's our timeline. Here's what we're doing. Keep us accountable. Yeah. And there's a part of me broke too that I, you know, for the good of just you guys in general, I do think there's a gift in living with them right now while you're paying it off. But I think having an end date that kind of makes you uncomfortable and forces you guys out. So I mean, this sounds crazy. But what if you what if you did November of this year, right? And you got pretty much a good calendar year. And you're throwing so much at the debt. But then you're saying, you know what? A year from now, we're going to be living in our own place. We're going to finish paying off the set. It may take us an extra couple of months because we're living on our own. But there's something about that growing up and being out on your own is a married couple that I don't know. I think it's good. There's something about having an end date for me

1:31:35would be really helpful. So it's not this ongoing idea that you're living there. And I would, and again, I think I would and I would shorten the timeline in a sense just to get you guys out, right? You're both adults. You both are smart people. You're a physical therapist. He's a dentist right? Like you are capable of adults. And you'll be able to pay this off. And there's something about two capable adults not living at home. That's good for you guys. But for a season, I think it's okay right now. I just have an end date. Does that make sense? Yeah. So if we set the end date, let's say, of November, do you think it's important to because what we've been doing for the past years and not like putting all our money towards my due loans, we knocked them out. That's great. But now we have like nothing to do for it other than like no debt on my part. Is it smart to kind of be saving money on the side as well? Just so that way, if by November, we're looking to buy a home. I need to put the idea of buying a home on hard pause right now. We have a huge mountain in front of us. You guys will be home owners and you will retire multi-millionaires. But right now,

1:32:38for the next probably two or three or four years, you have a mortgage right now. Creating a foundation. Two hundred and twenty thousand dollars. The amount of interest you pay is more than most people's mortgage. Yeah. So let's focus on knocking out all debt. Yes, all focused on this. Then you get an emergency fund of six months. Then we begin saving up the down payment. And so you might crunch the numbers and go, okay, in Chicago, we're at a seven hundred thousand dollar home. We might need to downgrade to a town home that's six hundred thousand in the suburbs, whatever. You guys can figure out the plan. But do not let this home get in the way of this financial foundation that you're building. Yeah. How old are you guys broke? Twenty seven. Twenty seven. Okay. Yeah. So I mean, if you guys are debt free by 30, you do some saving and you guys are, you know, home owners by 32. That's a great plan. So and you have plenty of time. You guys have time and you make an incredible income. Like you're going to be able to make some big strides. And that's if all of your income stays the same for the next five years, which it's not. It's going to go up over time. So it's

1:33:39going to fast forward your plan. I think you're going to get to all these things faster. But you have to do it in the right order, which is the baby steps. So you want a thousand dollar emergency fund. Go ahead and get out of all your consumer debt, build up that emergency fund, and then be saving up for that down payment. Have you guys, have you guys read the total money makeover? My husband has. He's having me reading it right now. Oh, well, there he goes. I'm going to give you a copy, but you don't. You know, I'll give. Let me give you George's. George is fun. Breaking free. A bro. There's more jokes in there. I think you'll. Yeah. Yeah. It's a great one. And read the student loans chapter. It'll light a fire. Yeah. And it just kind of solidifies broke like just the way our generation does money. It kind of just like pokes a hole in all these, you know, industries to show you that you don't have to be normal. You don't have to normal. So I want it to solidify where you guys are. I don't want you going backwards in your progress. Continue to move forward. You have a great income. You guys are smart. But get rid of this $420,000 loan in two years. Do it. Make a crazy goal. Do it.

1:35:02When you're tired of feeling stuck with money, there's just one solution to get different results. You have to do something different. No one accidentally wins with money. You have to have a game plan. And that begins with our get started assessment. Go to ramsysolutions.com. Slice start. Answer some questions. And we'll show you what steps to take next. Don't stay stuck. Take control of your money starting today. Go with ramsysolutions.com. Slice start. Next we have Samantha in Phoenix, Arizona. Hi, Samantha. Welcome to the show. I think you're taking the time to speak with me. Yes, absolutely. How can we help? So, um, I think I are on maybe step seven and we're trying to figure out what to do next.

1:36:08So we are right of that. We've got three thousand seedings. We're contributing to our 401k in a lot of our way. And so we're just and we on a home. That's amazing. What's your house worth? Um, when we bought it, we bought it for 150 and right now it's worth about 400. Oh my gosh. Yeah, we pay it off. How old are you guys? 28 and 29. Oh my gosh, Samantha. Who raised you? This is crazy. I grew up listening to Dave Ramsey on the car right home. Financial piece, baby. And you guys were like, all right, let's just live this out. So you guys got married. You were dead free or close to it. You were able to get a house faster and pay it off. What do you guys make a year? Between the two of us, we make about 200 before taxes. Okay. Good for you guys. You said you had how much in savings? 30,000. 30,000. Okay. Awesome. And you're asking what's next?

1:37:10Yeah. I also have a secondary question that might plan to this. I have a house I inherited as well on top of this. And so we're debating selling it and investing it in another house to kind of be like our current house and invest in a nicer house to live in versus sell it, sit on the money, put it into stocks or something. We're not really sure what to do with it at this point. Yeah. When do you guys want to upgrade houses? Do you know? We're looking to do it sooner than later. We are putting that home on the market because it's not making us anything and we're unable to rent it comfortably due to the location and manage it well. Okay. So we want to have a rental in the same city that we're in so we can manage it. What do you think you would net from that? Probably 400,000 as well. Wow. That's incredible. So you would take that 400,000 and get a different house in cash and then you would keep your current one rented. Yes. Is that feasible? Yeah. You can get the house you want for that 400.

1:38:14In your area. Our dream house would probably be a little more so we'd have a mortgage about 200 and then we'd pay that off in about a year to two years. It's our goal. Okay. Yeah. Well, I think that's, yeah. So you ask what's next. I think that would be the next step, right? So probably for the next two to three years when it comes from everything from selling the houses, closing, finding the new and all that. So I would say you guys have like a house goal here for the next three years of buying something and if you take a small mortgage, paying it off quickly, all of it. So that would be, you'll be back in baby steps six for a bit and then back to seven and then you reassess your goals and that's really when the world's you're oyster and you guys get to dream. Do we want to get another home? Do you want to get into real estate? Do we want to give more? Go on these trips. It just sort of scales up everything. It scales up your spending, it scales up your giving and it scales up your investing. Yeah. So to George's point too, you know, doing all of those things is going to be really important. Samantha, you know, when you guys are in baby steps seven and you're going to be settled there

1:39:16for a while once you have this new home and it's paid off is to up your giving and find some things that you guys are excited about. And I think, you know, this is one area that Winston and I really kind of had on autopilot for a few years and probably because we were having babies and all of that. I don't know. We are so we are giving and doing, you know, mathematically what we're supposed to. But it just kind of didn't get as exciting. And so we've switched up even how we give. And it's it is so fun. Like it is brought the joy back for me in the last like year or two of like, oh my gosh. So get creative and you're giving. Find things that you really are passionate about. Do some fun stuff with that money. I mean, genuinely, that is it is some of the most the most fun you can have with money. And we say it all the time, but it really is true. And then be saving, continuing to invest. And and even maybe, you know, have some big saving schools for things that maybe you want. And then enjoy some of it. And so doing the giving, saving, spending, formula, all three things need to be happening. And yeah. And that's what's kind of crazy is like,

1:40:17there's not a lot of people say this when they finish the baby steps. They're like, they want like baby step eight. Okay. What do I keep doing? You know, so I'm like, you tell me I don't get to decide your life for you. Yeah. Yeah. We've done some travel. We've done some things. So we could have more saved. But I mean, we've been kind of enjoying life a little. And you guys have kids. I did. No, we don't. Okay. We want to do their place before we do that. Okay. Cool. Well, here's all. No, go now, Samantha. Yeah. Don't wait for the big house. What I want to tell you is that babies are small. It's okay for your dreams to change. You may go, you know what? I want to stay home and you guys have the flexibility to do that without it being, you know, adding any financial stress to your life. And so I would, I would sit down to a dream date with your husband this weekend and go, Hey, let's both put a goal for each category on paper of what we want to do next year. Here's my giving goal. Here's my investing saving goal. Here's my spending thing I want to do. Rachel's vote is half babies earlier. And we're having kids next year. It's going to be awesome. You never regret it. We do. One of us is going to be a stay at home

1:41:20with the kids. So we want to be comfortable with that. Like when it comes. Yeah. I think you guys are great, right? I mean, you have no debt. You're choosing the house thing. I'll say that. If the, if the getting into this new house, that's the caveat is does that put a damper on your plan for one of you to stay home? I don't want you to like, well, once that house is paid off, then maybe we'll start thinking about having kids. I would put the kids as the priority before upgrading the home. The child will survive in this home that you have now. That's true. Okay. And then if we were to, say, sell like this house in the next month, and then we, we decided not to buy a home. Would you guys let that money sit in a high yield interest account? Or would you invest or how much of that would you say? I would know high yield because you're talking about like a one or two year goal, right? This money's not going to sit there for more than one or two years. And that's where I go. Hey, the market, it's been great the last few years. Who knows what 2026 or 27 is going to bring if it's negative 20% and now you're on the cusp of

1:42:21trying to buy this home? And so the high yield savings account just gives you some stability. It'll grow at, you know, three and a half percent right now. But that's, that's kind of more guaranteed than the market, which is going to fluctuate more drastically. So if I had a one or two year goal, I'm going to park it in high yield savings. And if you want a great option, you can check out Fairwinds, you can go to fairwinds.org slash Ramsey. They have an awesome smart bundle for you. I'm next. We have James and Ohio. Hi, James. Hi, guys. And you've taken my call. Absolutely. How can we help? So my wife and I just last year purchased our first home. And it's a little bit of a fixer upper. I'm well within what we can afford. But I did jump to gun a little bit and looking back in hindsight, I kind of regret it. Just because we still have a little bit of debt, just a little under 20,000 total. Okay. 12,000 of that is on my wife's car. Okay. 5,000 in a student one of hers.

1:43:21Okay. And just under two grain of credit card debt. Okay. How much do you guys make a year? Last year, I grossed about 80 and she heard about 20. Okay. Perfect. All right. Well, why don't you all just, you know, pay this off in five months. That's the goal, ultimately. But essentially, my question was, is I'm driving a car that I bought for 5,000 dollars cash. And we still owe about 12 on hers. And I know it's well under 50% of my our income, you know, wheels and motors. But what I wanted to do was sell the car and get another, you know, cheap car just to pay that debt off because I'm so tired of making that payment. And she disagrees with she thinks we should just keep it and pay it off. What's the car worth? Probably about one or two less than I owe on. And on how much do you have in savings? So I paused on the baby's test because my house is in desperate need of a roof. So I have 10,000

1:44:27in savings earmarks for that. Now I think that my dad and I, because I'm going to do it myself, can probably do it for about six. Right. I don't know what's what we're going to uncover when we rip the shingles off, you know, open Pandora's box. Wow. Yeah. I don't. I'm not looking to sell her car right now. Right. I think you guys will pay it off. If you can pay it off in five months, it's not worth selling because now you got to turn around and use savings to buy a 5,000 dollar car, $3,000 dollar car, which could lead to more issues. So you're going to upgrade sooner anyways. So no, yeah, I think it's, I think it's doable. It's not that desperate. Yeah. And I think you guys need to tighten this up, James. I mean, you guys have kind of, I understand that the whole house situation is kind of puts you guys in a, in a different position, but I mean, get back on track and you guys can, can get all this cleaned up really fast, really, really fast. Just be on the same team with it, but no, we would probably not sell her wife's car. Hey, good folks, Dr. John Delone here. Don't you think life is too short to hate Mondays?

1:45:40Listen, you're worth loving the work you do and where you do it. So guess what? Ramsay 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 ramsysolutions.com slash careers. That's ramsysolutions.com slash careers. If you ever hear a money question and you want some guidance like you would on the show, um, then we have a spot for you. So I mean, I feel like this show George is sometimes hard to get on the line. It's always all the lines are usually always booked up. So if you're like, man, I really wanted to ask this question. Well, we've got a free tool for you. Here's your chance.

1:46:41Yes, if you go on our website, you can ask your money question and get an answer to your situation. 24 seven. It's pretty crazy. So, um, AI, love it, hate it. Well, we're using it for our advantage. So we actually our ramsys team went in and like did all their magic and the ramsys, I is here. It's built on the ramsys principles custom built. So it stays in the guard room. It's not random financial advice. It really is through ramsysolutions and what we teach. So you can ask your question at ramsysolutions.com or if you're watching on YouTube or podcasts, you can click the link in the description. So you guys check that out. I dare you all to go test it out right now and see how close it is to what we would say in the show. That'll be a fun experiment. It's great. Yeah, we're trying to help as many people as possible. Not, you know, if you can't get on the show or slide into our DMs with your question and we don't get back to you. Whatever the thing is, like you have the ability to ask a question about your money and we want to help you do that. All right, let's go to Kurt and Calgary in Canada. Hey, Kurt. How fun.

1:47:44Hello. Hello. Welcome to the show. We love to bring on people who have absolutely killed it when it comes to money just to hear their story and honestly, to kind of set up the idea like this can happen. Like you can actually start with nothing. Yes, and build a positive net worth and one over a million dollars. So Kurt, thank you again for coming on and what is your net worth? Just north of two million Canadian. Wow. And how old are you? I just turned 45, not too long ago. Well, that's wild. Are you married? I am. Fantastic. Okay. Tell us the mix of this two million. Break it down for us. Oh, goodness. Probably a quarter of it is retirement. 10% is my kids college fund. I've got about a quarter of it in corporate assets for the businesses that my wife and I run and

1:48:49some cash on hand. You know, probably a third of it needs my house, our house. Yeah, just a lot of places. I love it. And you guys have been following this plan for how long now? So you'll have to forgive me. I didn't know Ramsey and the baby steps existed until maybe four or five years ago. You were smart before you found it. It's great. That's impressive. Smart and stupid. I won't lie. You know, we took on a what I would call a sole crushing amount of debt, but we worked our way most of the way through it and we always have left to the mortgage. Wow. What's your household income? Just right around 200,000. Okay. What was your best year and worst year of income during this journey? Well, the worst year would have been when we first got married. I was still a university student and my wife made $33,000. But once I graduated during household income, sort of started around 70 or 80,000. We kind of averaged around 110. Most of the time it told me only in the last few years

1:49:56has it really moved upward. That's awesome. And did you guys inherit any of this two million? You know, my wife's mother gave her part of her, when my wife's grandmother passed away, my mother gave us $5,000 to go on a trip. So safe to say it did not mathematically cause you to become millionaires. Because that's a big myth we hear all the time. Well, you got inherit money to be a millionaire. Must be nice. That's not a story. And what are your careers? So my wife is a bookkeeper and I'm an engineer. Oh, yes. Which? That's about a right up the alley of our study, about millionaires. Number one career choice. Yep. In the millionaire study, over 10,000 of them was engineer. What do you attribute that to, Kurt? Is that, you know, you're a process driven guy and you just went, okay, I'll just follow the process. I attribute it to my wife as any sane man should. No, we, it was always, you know, we, we live within our means and apart from a few decisions

1:51:08along the way, you don't buy something if you can't pay for it. Okay. So y'all've always been very averse to debt, you would say. Well, yes, and oh, my, my mentor retired earlier than planned and he sold the business to myself and Mike, one of my, and my business, current business partner. And we weren't quite ready to purchase that outright. And so we had to finance the purchase of the company. That's right. That part, but consumer debt when it comes to clothes and vacation, cars, cars, cars, we, we finance one. And I, and it just, I hated it. Yeah. Yeah. After two years, two years, I just couldn't stomach it anymore. And so we, we got rid of that as soon as we could. Wow. What are you guys driving today as real life millionaires? Give me a year make model. My car is a 2013 Volvo C30 just a little hatchback with over a hundred thousand miles on it.

1:52:09My wife, she gets the new car. It's, it's, we bought her a new car just a couple of years ago, as it should be. A tree found on our last one, but oh my goodness. Yeah, it was just unfortunate timing. But no, she has a 2023 Volkswagen Tiguan. Nice. Very great. And paid for in cash. Paid for no nothing. That's amazing. So she's got a three year old car. You've got a 12 year old car. And that's, we found in the millionaire study, the average millionaire drives a four year old car with 41,000 miles on it. And the top brands were Toyota and Honda. Yeah, which is pretty wild. So you guys are square in the middle of that. And you guys have four year degrees, both of you or more? Both of us. Yeah. Okay. Well, you got super smart. What were your GPAs? Do you remember? I'll just say I finished my, my finished my, my degree with the GPA of around 3.7. My wife was higher. She's a smart cookie. This is impressive. I know. That is impressive. That's amazing. Well, Kurt, what would you say to someone that's listening? Maybe it's a

1:53:13newlywed couple. When I'm still in school, maybe they're starting off just like you and your wife did, you know, how would you say, what are the principles that you would tell people? This is what you have to do if you want to start building real wealth. Live on less than you are less than you make. If you make it do, use it up, do without those were the guiding principles that we live by. Wait, say it again. Use it up. What'd you say? Use it up. Yeah. So if you've got something, use it. Don't wait. Don't wait. Don't wait. Don't be wasteful. Do without, meaning that if it's not absolutely necessary, don't do it. And yeah, you use it up. Do without and make it do. So repair, repair as needed and make what you have last. Take care of what you have so that you don't have to keep going and buying new things. Yes. That's old school. That's definitely like a grandma grandpa principle right there. You know, coming out of like a great depression, like we're not going to get new stuff. That's crazy. This works just fine. We'll fix it up. Well, I love it because you can

1:54:13get in the habit of something just kind of is off a little bit. Yeah, we'll just get a new one and we'll just get a new one. One Amazon. It'll be here in two hours. Yeah. And you end up, you do. You end up spending so much to do in that. Okay. So Kurt, would you say now where you guys are? Do you are you enjoying your money? Do you feel like you guys are having fun? Not yet because we still have a mortgage. And so that, you know, the fun is coming when that's done and gone. But, you know, right now we're still we're still working a process. And but for me, it's the it's the piece that comes from, you know, it's like we've got six months of an emergency fund so that if, you know, because we're both we're both self-employed if our income is variable. It's like, you know what? That's okay. We've got we've got comfort and peace. Yes, absolutely. Yeah, that that padding is very real between you and life. I mean, there is something that does give a lot of, all you can sleep at night, the stress is down because if something happens, we're going to be okay. We have this this money set aside. So how much longer to the house is paid off?

1:55:15Uh, five years. Okay, yeah. The goal the goal is debt free by 50. The right page of 50. And by then you'll probably be worth closer to three million. Maybe if things get closer to 3.5. If things keep things keep trending the way they are, yeah, maybe yeah, I could see that happening. Well done, Kurt. Thanks for the inspiration. Yeah, you guys are awesome. Thanks for calling in. Always your stories. Yeah, definitely kind of give a boost to people out there to see real life people doing real life stuff. So thanks. How many times have you started January saying this is the year I'm finally going to get my money under control, but then months go by and you still feel broke. You work too hard to keep

1:56:21living like that. Look, there's only one way to move the needle on your finances this year. You've got to have a plan. So start by downloading every dollar. Every dollar is way more than our world class budgeting app in 15 minutes will build you a personalized plan to free up extra margin in your budget and use it to beat debt and build wealth. You'll find thousands of dollars on average just the first day and you'll get new steps and new lessons every day that help you stay on track and create unstoppable momentum. Don't waste one more day feeling broken stress. Get your plan in just 15 minutes by downloading every dollar for free today. Our scripture of the day is from first Timothy six five through seven. This is one of my

1:57:26favorites George, but godliness with contentment is great game. Before we have brought nothing into the world and we can take nothing out of it. Bob Bob Marley said spend life with who it makes you happy not who you want to have to impress. Oh, it's pretty good. But yeah, the godliness with contentment is great game. That is that's big. You brought nothing into the world. You can't I saw someone I couldn't I couldn't quite live with this philosophy because it's a little bit too yellow for me, but it was like on Instagram was a meme and it was this woman she was like at the beach like had a drink or something that she was like, you know, you know, you know when basically like in the graveyard, you're not going to you don't care if you're the tannis or the the have the best skin, skinniest, biggest bank account. Like she listed all these things that we worry about. She's like, go enjoy your life. Like eat the pizza, you know, take the trip, do the thing. And I thought, you know, it's a little bit of that. And you are very experienced is over things person. Yes, which is wise. The data bears this out. So it's one of the best ways to spend

1:58:29money is on experiences with people you love. Yes, we've heard that Arthur Brooks talks about that a lot. And there is something to that Rachel's using that to justify every next trip. She's like Winston. It's science. We have to go. We have to go. This is where we should spend our money. I'm telling you, it's what everyone remembers. It's the fun big meal. It's the whole, you know, my house, we had all the personalities in their spouse. We had great best time. You got her so generous. We have a great dinner. I don't know all of it. There's there's something about yeah, you could about a purse, but instead you said, you know what? Let's have a great meal with friends. And I can't take the purse with me until the next life. But I'll take the memories. Could be in your Costco casket in there with you. Well, good seconder do. It's not going to do good for anyone. So I love it. Yeah, godliness with content. My great gain. You didn't bring anything to the world. You can't take anything out. All right, let's go to the phones and we're going to go to Hunter in Fresno, California. Hi Hunter. Hi. Hello, hello, welcome to the show. How can we help today? So my wife and I, we are a little bit of, uh, we just got married about a year

1:59:32ago. We we started off really good financially. We're making a little over a hundred thousand. We kind of had it racked up some debt. We bought a new truck. So now we have about $50,000 on that. And then we also got a camper. How much is that? 20,000, 20,000 is what we still want to. Okay. What other down the up? So other than that, the only other day is we just bought a house about a month ago. Um, and so now we, and is that $2,800 payment on to our monthly payments? And what's your monthly take home pay? Monthly take home pay, kind of ranges, pay ranges anywhere from, uh, it can be anywhere from 5,000 to roughly about, uh, I would say about

2:00:39nine, 10,000. Whoa. Okay. Well, that would be more than a hundred thousand if you're, if you're fairly consistently getting, you know, eight, nine grand a month take home. Well, yeah. I mean, uh, this past two months, we've only been taking around about 5,000, uh, but a couple months prior, we were, how are you guys, how are you guys surviving? Yeah, your mortgages over half your take home pay in many months. You got a camper loan or a picnic in the truck. So the truck payment is 1,300. Oh my gosh. And what's the camper payment? 5,000. So you got 2,300 going to toys that are going down and value every day. Yep. So okay, but my thing is if you make 5,000 a month, that's $5,100 just in payments. How are you guys making your light bill and food? Like do you guys have savings? We do. We have, uh, we have roughly about, so we have roughly about 20,000 in our savings account.

2:01:42Okay. And you're just going to be draining that a little bit at a time to live off of. Right. Well, so that's right now. The reason that fluctuates is I'm currently in school. And so with my construction business, you know, there's sometimes, you know, I'll get a job and I can work around school and I do great. And then there's other times that, you know, school gets caught up and I don't have as much time to work. Yeah, I'm about a camper. Yeah, it feels like a bad time to buy a $50,000 truck and a camper. And a camper that you probably don't have time to use. Hunter, do you just feel great? Like do you feel like what did we do? I, yeah. What is your wife think about all this? Let's make it. Yeah. Is she like, hey, we got to get out of this situation or is she like, it's fine. He's got it under control. Both. I guess she, uh, so she, I mean, you could tell if she gets, um, nervous or frustrated

2:02:42every now and then from it. Uh, but she's also, uh, she realizes that we're not, I guess we're not, we're not at the end of the road yet. We can still come out of this. And so she's a little bit more comfortable with that. Okay. Um, so yeah, we're, we're definitely, we're, I mean, you're like, I'm trying to, probably nine to 10 months away of having nothing though. You don't even mean like, I think not, I, y'all don't, it doesn't feel this, or I don't feel an urgency necessarily. And so that 20,000 is going to go really quick because the months you do make the 5,000, you're already $100 underwater, right? So you take that 100 and then you got to, you know, you guys are probably going out to eat your stress with school. So you're, you know, you're doing this. And I mean, you guys probably are not on a very strict budget, are you? Um, right now we, we actually past couple of months, we have gone on to a strict budget. Um, we don't really eat out maybe once every couple of months. Oh, I'm sure we have nothing.

2:03:45Really? If I look to your back account statement overnight, over two months, over 60 days, you don't eat out, except for once out of 60 days. Yes, ma'am. Yes, ma'am. All right, I'm going to take your word for it, Hunter. Okay. I'm like, you're a honest man. I will tell you what I would do if I was in your shoes. I just feel like a Starbucks run is probably in there somewhere. Maybe for her at least. She needs, you know, you guys need some vices right now. This is crazy. Okay. Okay. Let's make a plan. Make a plan for Hunter. Luckily, Chick-fil-A is like 30 minutes away from you. Okay. That works. Okay. Fine. That's fine. That's fine. That's fine. So I'm Hunter. I'm a newlywed. I've been married a year. I have a cool, great income. What are you going to do, George? I am selling the truck and camper tomorrow. Like I'm taking pictures tonight. I'm listing it tomorrow. And your construction ego just plummets from there. And any amount you're under water on, you're going to use that $20,000 in savings to cover it and get yourself a beater car. Oh, okay. It's working now. And then what's freed up, George? How much money you got? You just got a $2300 a month raise, my man. So those $5,000 months turned in to $72,000 for it. Now we can breathe. Oh, my gosh, George. What a plan.

2:04:49All right. This is great. This is a solvable problem. Then what are we going to do? Then we need an emergency fund because you likely will deplete that $20k to cover the underwater difference. Yeah. Plus getting you a beater car. And so now our job is to really build some financial stability once we don't have debt to get three to six months of expenses. Has that sound, Hunter? Yeah. Make your sound a lot easier than what it is. I feel like you're not willing to sell this truck or the camper. Tell me why. The camper, I'm actually the camper. I would get rid of it in a heartbeat. But my life about selling it. What was that? Yeah. I said, and they can be tough to sell. Well, they're tough to sell. And it actually came from her parents. And so she's a little bit more stuff to it than I am. Don't have don't have like attachments to campers. We got to get attachments to healthy financial foundations. That's what we're looking for here. Or Hunter, you guys can, here's the deal. You know, you called the show. I feel like we're giving a little tough love. But the truth is you can stay in this cycle. You guys can stay with campers and trucks and

2:05:52payments. You can live in a truck and a camper, which will be your future. No, but this is, no, but like this is normal, Hunter. This is normal. And you guys can go on for years and years and years. And then what's going to happen is you're going to have a baby. Something's going to happen. One of you is going to want to stay home. You guys are going to be in your early 30s. The roof is going to be leaking. And you have no money. And you look back and think, what have we been doing? We've been working our butts off for seven years. And we can't even do what we want with our life. Why? Because in our early 20s, we just, you know, our mid 20s, we didn't make decisions. These are hard decisions. It's hard for the ego. The ego hates it. But I'm telling you that you guys can stay normal. But you called the show. And the show is far from normal. We are all about getting out of debt, making deep, deep sacrifices, Hunter. In order for you guys to get ahead in the future, you guys can get a great truck and a camper. But when you can afford it, you can't afford it. You can't, you don't have the money for this stuff. And then you rush into a house and all of it. So say it out loud, own it, and go, hey, babe, I'm sorry. I screwed up. Yep. All right. What a great show. You guys,

2:06:54thanks to everyone in the booth. Thank you, George. And remember, there's ultimately one way to financial peace. And that's to walk daily with the Prince of Peace, Christ Jesus.