Don't Be A Slave To The Lender

0:00Just sticking with your existing Medicare plan could be an expensive decision. Let Chapter review your options for free. Learn more at askchapter.org slash ramsi. Brought 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 ramsi network in the Fairwinds Credit Union studio, this is the Ramsey Show. I'm George Campbell joined by Dr. John Deloney. We're taking your calls at AAA8255225. Patrick is in Detroit. What's going on Patrick? Hello guys, thanks for taking my call. Sure. So in 2012, I bought my family's home for $80,000. It was at about 3% interest and worked on it, put in sweat equity.

1:04And about 10 years ago, I filed bankruptcy because I was buried in student loans. And I kind of got that in order. Of course, I couldn't get rid of the student loans, but got rid of other debt and structured things. Well, after COVID, I saw that I could sell the home I was living in, which I loved. And I'm sick about right now to pay off those loans. So I did, and I did pay off those loans. And I was debt-free. And I subsequently rented for four years. Rentals are pretty high in my area. I rented for about $2,400 a month for three to four years and wanted to get back into owning a house. So I bought a house last January for $230,000 with no money down, which I was sick about that too.

2:06I'm raising my son alone. He's going into a senior year. And I have more debt now than I've had before. I have a car loan. I have $230,000 in mortgage. I'm paying $6.25 on that mortgage. I make $100,000 a year. I'm 59 years old. And I'm looking at retirement. You know, I'm breathing down the barrel of retirement. And I have only about $150,000 in a 401k. I'll tell you guys, I'm not sleeping well. Yeah. Thanks for calling, man. Thanks for calling. Thanks. That was a hard call to make. And I'm proud of you for doing that, man. Cool. Yeah. And we'll give you a path. I don't like it out of this. We're going to give you a path here, but we're not going to beat you up. We're on the same team.

3:06Okay. But if we're going to do what we get, I agree on one thing. We're not going to beat past Patrick up for his mistakes. That's right. You've been, you got to crick in your neck from looking backwards. Of all the things you wish you could have done, things you should have done, regrets, shouldn't have sold that, shouldn't have taken on that debt. So can we agree that this is a new chapter for Patrick? 59 is going to look different. Yeah. Good. One of your homework assignments this weekend is going to be to write 2014 Patrick a letter and let that guy go. Set him free. Okay. Yeah. And then we're going to write 65 year old Patrick a letter about who you decided to become at age 59 so that he could have a different life. Okay. Yeah. All right. We're getting to the math here. So you're a 59 year old making a hundred grand. We're getting to the math. Yeah. Before we get into the math, I left something out. I do have $30,000 that is in my bank account right now. Great. Great. You're doing better than most of America.

4:08If it gives you any consolation, it's a low bar that you're doing better. So what is left on the car loan? 26. Man, sounds like you could be debt free today. Except for your mortgage. Well, and there's a $7,000 loan that I had to take out to get some repairs done on the house that had to be done. Okay. But that's all the debt. So you knock out the 7,000. Is that one loan? The 7,000 repairs? Yeah. Okay. So if you knock that out, you're down to 23,000. You still owe the 26 on the car. You can knock most of the car out and keep that $1,000 starter emergency fund. What's the car payment and what's the payment on that other loan? The other loan is about $175 a month. It's got like a 10 point. It's a $7,000 loan with 10.5% interest. It's about to be $0 a month, a 0% interest. Yeah. Congratulations. Yeah. So you freed up 175 today. What about the car loan?

5:09What's the payment? It's about $5,550, $5,75 or something like that. Okay. So $5,75, we're talking $750. Freed up. In the next couple of months, if you do this, so you just got about a $9,000 a year race of take-home pay. Got it? That leads me. Yeah. That I get it and I would love to do it. But I am scared to death that I'll lose my job or something like that will happen and I'll have nothing and I have my son with me. Gotcha. We got you. But here's what I know. If you lost your job, which every single one of us that can happen to us, right? You have your son with you. You're under the squat rack of fatherhood of life, of responsibility. And you know that would be a big kick in the gut. And you would owe nobody anything except for your mortgage. And then the very next day, you'd be at Home Depot, at Lowe's, at wherever else, applying for jobs.

6:09And you'd make enough money to pay your bills. And you would show your son. You'd give him a ring-side seat as to what a grown man with responsibilities does when he gets kicked in the gut. Right. You're projecting all the negative into future Patrick's life, but you're not projecting the reality into future Patrick's life, which is you're a good man, and you work your butt off. And you love your son and you love yourself. Right. Yeah. And so you're going to have 750 bucks on top of whatever else you have in margin. And you're going to rebuild that emergency fund right away. Are you taking home about six grand a month right now, seven grand a month? Yeah, I think so. I think that's about right. I'm in the other room, so he can't hear me. I wait for my budget, but yeah, it sounds good. It's I'm taking home now. Yeah, you think so. Okay. And then what are your monthly expenses? What does it take to just cover the bills? We're not living luxuriously, but we're just four walls, food, utility, shelter,

7:11transportation, insurance, debt payments. I think like five. Okay. So napkin math says you should have if you do it right. One to two grand left over every month. And that's without freeing up to 750. Right. You might want to up that a little bit maybe more than five. Well, let's get it down to 50 would be mine. I think the 750 I probably had about a margin of about eight eight hundred nine hundred. But if we sat down together, we did your budget. Do you think I could find that much room? If we went, you could probably cut that. We could do better here. There's two of you guys clean that up. Probably. Yeah, of course you could. If you're future dependent on it, your retirement dependent on it, could you do it? Well, yes. Good. Because it depends on this is part of the letter you're writing to 65 year old you. We stop spending on X, Y and Z so that so that my son wouldn't have to take care of me when I was 70. Right. Yeah. Yeah.

8:12You are way better off than you think you are. And George nailed it. You spend so much energy beating up past Patrick that you're not giving him any any chance to be successful in the present and forward moving forward. Like moving on. And by the way, sit down with your son. There is, I just looked it up. There's the community college guarantee, the promise there in in Michigan. You might sit down and say because of my situation, because of choices I've made, I can't afford for you to go to college. But luckily we live in a state where community college is free. And I'm going to keep saving, work on myself, get myself completely out of debt. And I might be able to help you if you transfer to a second year to a four year college. Moving on, if that's what he wants to do, there's so many options for you. But it starts with you believing I can make this work.

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10:17That's zander.com. Justin is up next and Dayton, Ohio. What's going on, Justin? Hey, how you guys doing? Doing well. Taking my call. Absolutely. What's going on? So, me and my wife are, we've been married for about three years. We've been pretty diligent about saving. We've got a fully funded emergency fund and close to about 40 grand. Save for a down payment. But she's wanting to quit soon. So I'm trying to change jobs to make enough that she can quit to stay at home with our baby. I'm just wondering if it's ever advisable to just get a 30-year mortgage in order to get into the market sooner and start building equity instead of just renting?

11:21Man, I feel your pain on this one because it houses a 2-B expensive. And you're like, the 15 years going to be $600 more for the payment and that's going to take this much more in a down payment to get there. So what is the house you're looking about? How much is it? I really don't know where the market is. So I mean, I would love to be under about a $200,000 house. Do those exist in your area? Even if we can, they exist. I think I'm willing to sacrifice on the quality of the house or what the house has more than my wife's. So she wants to stay home living one. I would make that sacrifice, brother. And have the dream home. Yeah, I mean, I think she's willing to compromise on some things, just, you know, the things that make a house more expensive she really wants. So you usually have a good... Here's what you're here's the trade you're looking to make. Okay, and this is just putting all the cards on the table. You have three different pressures on you right now.

12:22One, your wife wants to stay at home with baby. That's a great thing. Okay, number two, you all want to buy a house. You had a picture of what your life would be, your wife especially did of, we're going to be a small family, we're going to own a home. That's a great thing. Number three, houses are incredibly expensive and the interest rates on houses are really high right now, especially on a 30-year note. They're really high. And so you have three pressure points here. And where I see people get themselves into crazy trouble is when they don't recognize that we have to prioritize these things and each, prioritizing each one of those things is going to come with some sort of... I hate to use this word because it sounds so dramatic, but it's going to come with consequences. Like, I really want to stay on with baby and that means we're going to have to rent for two more years while we save up. We're going to, I'm going to stay in the workforce for one more year longer than I have to.

13:22I'm going to make one of those construction paper chains and hang it in my bedroom and my tear off one every day. But that's going to accelerate us being able to get into a house so fast, so that we have the rest of our lot, right? You know what I'm saying? Like, it's when people try to do everything all at the same time and then they start moving values around, they start moving their principles around, they find themselves just buying a brand new car because it seems easier. Just buying a kind of a lesser house than either of us want just to say we have a house. By the way, that feeling will last less than one week and you'll go, oh no, we need to fix the catch and do this in the bath. Oh, there's a leak in the roof and now you're stuck in a pretty ugly situation. So it's just recognizing we have three amazing choices, three great things that we all want in front of us. But we can't do all of them right now and so we have to make some choices on what we want more. Yeah, make sense. What are you making every year? Between the two of us right now we're about 75.

14:26She's the bigger half of that and I've been working for the same guy at some high school and it's just not grown into what I was expecting. So I'm moving jobs in the winter just to finish out the year with it. It's a landscape business. Okay. Because here's the thing. It's not the housing markets fall right now. It's an income problem. There's just a math equation here. If we go down to 35, 40 grand in income, we're not going to be able to eat. This is not like a rent versus mortgage thing. So either way, we've got to get the income up if this dream is going to come true. And I hope it does. I mean, you guys are young. How old are you two? I'm 22 and my wife's 23. Okay. Average, average homeowner is now about 40 years old getting to their first home. So even if it takes y'all four years, you're still so far ahead, man. And by the way, like for real, dude, like this is just two dads talking to another brand new dad. Do not buy a house until you've got secure employment. Yeah.

15:26Okay. Like the last thing on earth you need is to be making 40 grand or 30 grand at a job that may or may not this or that or could be, dude, don't do that to yourself, but don't do that to your wife, don't do that to your kid. Don't do that to the temperature in your home, man. And that means like cool, I'm going to look for a job that I need to make 75 grand. I might have to go get some new training. I might have to like, so it's just putting the cart before the horse and a lot of stuff, man. But dude, we like, I can't tell you George and I how big of a fan, George and I are of all the things y'all are trying to do. Right. Yeah, thank you. It's just slowing down and not letting your dream become a nightmare right underneath you because you want to do it all right this second. Yeah. And I will say I'm making like 35 right now and I have an interview next week for a job doing HBAC in which I'll start at about 40 and I've got friends at that business that are making north of 90 doing that. So like fantastic. I'm going to go and make it work so that I mean I want my wife to stay at home.

16:27That's like priority one and I think I just needed to hear something more concrete and that it is going to be worth it to save up and get and you know how our feet on thought are ground first. And the math isn't in your favor. The rates are significantly higher on a 30 year to 15 year. The amount of money you would pay over that 30 years, you wouldn't stay in the cells for 30 years anyway. But yeah, it's just this, it's just I didn't do to get it man. I get it, that desperation. I got to get my family house. I got to get in the house. I got it, this kid's got to have a get it man. I get it. It's just not there for you yet. And by the way, it's important that you and your wife have the conversation about she wants to stay home, she wants to own a home. And that means you're going to be working seven days a week. They're sacrificed on either right. And so she may come back and say, I actually want my husband too. What does this look like? What does the season of our life look like? We're one or both of us is grinding like this. So it's just asking yourself, what kind of life do we want? And then what's the path to get there?

17:28But I love your hustle man. You're a good man dude. When I was 23, I started this company just and I was 40 grand in debt. So the fact that you guys have an emergency fund, you have 40 grand save for the down payment at this age is so incredible. Yeah, you're so far ahead. You are not behind at all. And if you buy a house at 25, you will still be an incredible human being who is crushing it financially. There's no law that says if you don't have a house by 25, you're a terrible dad and husband. I'd rather you be 27, have rented for several years, save up a big chunk of a down payment and you'll go buy the house you actually want, not the one that you have to suffer through because like you were so desperate to be a homeowner. Both George and I rented for a long time as married men. I had roommates all the way up until I was married. Both of my kids and even then rented houses and they've worked out just fine. Yeah, so what is your rent right now? It's 1200 a month. Okay. Now if we go down to one inch running from that's still another.

18:31It's not important. It's not a bad situation but we're actually renting from her parents. So that's another thing that I'm it's not a bad situation at all but I'm definitely excited to not have that anymore. Sure. For have your in-laws be your landlord? Yeah, that's a fair wish. But if your in-laws are great and they're giving you a good deal, then come up with a plan for in one year we want to be out or in 18 months we want to be out. I don't have six months we want to be out and it is the dude George the biggest pain is moving from rental to rental before you buy a house. You feel like it's a waste of time energy and not a dosage it's the worst but man if it sets you up if it sets 28 year old you up 30 year old you up man it's a pain in the butt now but I promise you in your 30 you're going to be glad that you slowed down and did it with the right way. It's just like a sling shot. This is this is a sling shot you're pulling it back and you're like wait I'm going backwards I want to go forwards and I go hold on but hold on we're pulling it back we're pulling it back

19:31and when you release that thing with a strong down payment she gets to stay home you live on one income there's no stress dude you are going to skyrocket ahead of everyone that you know that's going oh I'm doing so good ahead of house five years ago where are they now? Might be selling that house because they did it before they were ready we don't want that to be human so do it the right way I'm going to send you a link to our free home buying course that I did so hang on the line we'll get you a link to that and for the rest you will put a link in the description to that course for first time home buyers completely free. Hey what's up guys it's Jade Warshot now I know a little something about saving money while my husband and I were paying off over four hundred and sixty thousand dollars in debt we went over every

20:33expense in our budget to find ways to cut back nothing got a free pass including our phones and you need to be doing the same thing and now with boost mobile one of the easiest places for you to save money is your phone bill their unlimited plan is just twenty five dollars a month forever with a price that nice why would you ever go back to your old carrier and with boost mobile there's no contracts no hidden fees and no surprises which makes this a no brainer when it comes to saving money best part you can keep your phone and your number when you switch so it's not like you're making some huge lifestyle change listen you need a phone but you don't need to be overpaying every month so whether you're paying off debt or building wealth or you just want to keep more of your money in your pocket this is a win go to boost mobile dot com slash Ramsey and make the switch today that's boost mobile dot com slash Ramsey twenty five dollars forever requires customers to remain active on boost mobile unlimited plan

21:44everyone needs insurance but it can be hard trying to find pros who aren't just looking to make a buck an agent who actually know their stuff well Ramsey trusted insurance pros are vetted and coached to make sure their market experts who have your best interests at heart so go to ramsey solutions dot com slash coverage to find the type of insurance you're looking for and connect with a ramsey trusted agent Lee isn't Seattle up next what's going on Lee are you there hello so yeah sorry about that I have a good question for you guys I have I make 120 grand a year but I'm sitting on about a hundred grand in consumer debt to break it down I've got 25,000 dollars on a single car loan on dash 45 grand in credit cards and 25 grand in student loans I've also got about five grand left on a couch I think that finance for my wife Cheryl oh wow we're dragging Cheryl now into this man she comes straight as Cheryl in the couch she's not even here brother

22:45exactly I agree in uh yeah do you get use of this couch too you might be sleeping on it after this call brother hope it's comfortable yeah I might be yeah it's it's definitely been a tough one for me I'm just I just think I'm I'm just spending yields here I feel terrible about all this Lee Lee what what what is 45,000 dollars in credit cards oh let's see uh I mean is that my debt it doesn't misunderstand what did you use that yeah what what did you yeah is this you trying to prop up a lifestyle that you simply can't afford is it exactly yeah I just let's see so I've got my car uh payment that I'm paying which the car payments expensive as well um now we're asking what's all about yeah yeah I'm I'm I'm trying to get to the root of um like how does somebody make an 120 grand a year

23:47and did your wife work uh yes she does how much does she make she makes uh about a little under than I make probably around 110 grand okay so you'll make a quarter million dollars together a little less that's not that a little less okay okay and what I'm trying to get to is how do you all owe a hundred thousand dollars and consumer debt half of which is credit card spending well that's the thing I don't know I mean I I tracked all these subscriptions that we have for like our TV services and everything and it seems like they're coming out automatically and um I believe this has nothing to do with Netflix yeah Netflix is not causing 50 grand in credit card that this is this is a guy who this is a couple who finances a couch yes this is our car payment this is we're trying to show you the math on this you probably you guys take home like 15 grand

24:47a month at least that's not enough for you you've went to credit cards on top of that because you couldn't afford your bills yes that's the problem is that close is that vacations that's what I'm trying to get to is there a spending addiction or house our house had to be remodeled and yes my wife does have a small I wouldn't say small spending addiction oh gosh let's see our house had to be remodeled we had a huge water leak uh about all of it when it to our house remodeling that's what I was trying to get to that that's it's different that our house exploded you put house repairs on the credit card versus I just have to get new clothes every week and my wife wants new furniture every other month that those are two different things for me just trying to help to get to the bottom of how we can help you best okay okay yes I understand okay is there one car payment and one that's paid off or do you guys just share one car we share one car the the car payment she bought a car she finances it we are about I'm trying to break down it we have

25:53our car payment the loan that we have for it was 25 grand um and now we every week or every time we need to pay the car payment we keep on setting it back because we aren't able to pay that so if it would just be better to sell the uh car or I don't know it's hard to explain but like I'm wondering if you can make the car payment why can't you make the car payment brother uh we have not enough money to pay it okay we've we've got bigger problems here than we can solve on a single call but you guys need to have a come to Jesus conversation tonight go look at your pay checks that showed up in that bank statement and then go find out where the heck all that money went do y'all share a check single checking account that both of your checks deposit into um no well actually she has her own I have my own it she will not stop spending it I'm in the other room right now I don't want her to hear anything well here here's the thing here I I respect that you want to you're a good husband who wants to protect his wife's honor I get that

26:57but brother yeah there's a I'm what George and I are trying to be trying to dig at and is becoming incredibly apparent to us is you have a huge situation on your hands yeah the the money as you know it as it's coming in as it's being spent there are tens of thousands of dollars unaccounted for and that happens and I don't want to put things out in the universe brother but that happens when somebody's struggling with addiction somebody's got having an affair somebody is just wildly out of control and so hear me say as serious as I can and as lovingly as I can you got a huge mess on your hands and the only way forward is for you and your wife to get in a room and y'all to put everything on the table and say we are about to lose our home in our car and we make $225,000 a year yes I definitely think I should have a talk with her and uh you know I've been struggling to figure out if she's been cheating on me because um she's been hanging out with one

28:02of her co-workers that she will not tell me anything about yes your gut is is I hate to tell you rather your gut is probably directionally right okay yeah and it's it's terrible because she's the one that telling me that I have the spending problem when she's she's out here buying couches and you know and I don't know how to do with any of it uh I need to put all this on the table like you said I like your idea you have a mirror nearby a mirror yeah yes I do I want you to take a look in that mirror and say it's not all my fault but it's my responsibility because so far nothing in this conversation has been Lee's fault at every turn okay she financed the car and she bought the couch and she has her own money I don't know what she's doing over there but man if she could just get her act together we'd be doing great I don't believe that's the case I think you both have some serious work to do on yourselves and on your marriage here's what here's what I would request at this meeting both of you pull your credit reports and you can do that for free

29:08what's the website George annual credit report dot com annual credit reports dot com you pull it for free and it will show you in real time who y'all owe money to and how much that's amazing I'll definitely have to check that out and what did you say it was called annual annual credit report dot com here's the next thing I when there's a whole bunch of credit cards because brother you don't know what she's opened in her name exactly and so I want to know as a married couple where are we spending our money and if there are certain credit cards she won't like you can't look at that you I'm never going to tell you that I'm not pulling my credit report you need to know that then you need to go sit with a marriage counselor or you need to go see somebody and you might end up sitting with an attorney because you got a big big mess on your hands okay exactly but George is right you have to own what you do next how you show up and treat her with kindness and dignity even though she's not giving you that back how you say here's exactly what I want us to do together give her a clear plan here's the numbers I want to see for us because y'all simply make way too

30:14much money to not to be in the situation you're in George and I talk to people all the time who have a lot of debt and who make a lot of money but dude you've got a hole in the bottom of your account somewhere that y'all just shedding money there's zero reason why y'all shouldn't be able to make your payments even own a hundred grand making as much money as y'all do unless you unless y'all live in a five million dollar house and your payment is seven thousand dollars a month is that true no it's about I would say our payment from the house is around five grand oh that's a lot but it's still a fraction of what you guys are taking home every month exactly and that's just one tiny piece you know that's a lot but it's not out of whack so yeah that's a tiny piece y'all you've got a big a big problem on your hand brother the only way is to go directly through it

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32:17to solace health solace health is extraordinary they pair patients with a personal advocate someone with an average of sixteen years of health care experience whose entire job is to fight for you so you get the care and honest answers you need and solace is covered by insurance they handle the paperwork battle claims denials from the insurance companies and make sure you're not getting lost in a system that was intentionally designed to be confusing so you and your loved ones can focus on getting well with solace you have someone who knows how to fight for you and who will go to solace health dot com slash ramsy or click the link in the description to see if you qualify it takes about two minutes that's so l ac e solace health dot com slash ramsy must be eighteen or older advocates do not provide medical or legal advice up next we've got michael in fortway in indiana michael welcome to the ramsy show

33:29hey thanks for taking the call absolutely i just want your opinion on something my my wife and i and our family were in baby step four five and six and um it's been just thank you for all the principles you guys teach us good us here it's such a blessing um and we um we just had our youngest kid go to kindergarten so that enabled my wife to go back to full-time teaching after being out for eleven years um amazing so thankful for her and just all she's sacrificing to do that um kind of our motivation as a family for her to go back was we're super close to paying off our age plus super um like forty uh forty two thousand i think now you had to we're almost at the finish line um that's a car loan for some people you got this exactly exactly so we're almost there

34:29and so um so i want you to take out you know taxes and giving them the fifteen percent we've on my income um you know it just it um it makes the shovel a little smaller to get it done you know and so we're wondering if we can get it paid off in like eleven months or a year what would you guys think of still doing the fifteen percent towards retirement from my income just like we've always done but holding off on it on hers till we get that house paid off and then after that just bump it all up about fifteen percent just to get it done i'm interested to know george and i may disagree on this but i want to be as honest as i can here okay i did that exact thing did you my wife and i circled up and said hey we're gonna pause this for one year and get this thing done forever and for our for for me who's got a psychosis about owing people money um it was the right thing but i man going on more than a year going more than

35:29eighteen months it's really entrust me from lived experience it's real hard to put that fifteen percent back right yeah to start pulling because man that feels like free money and the discipline it takes to go back to investing i i've lived it it's really hard right yeah what do you think what's the what's the principle george well i'm wondering what is your wife make a year as a teacher now so she she's bringing in 52 52 a year now and that one's got an automatic deduction doesn't it for a teacher retirement system of some sort so so they've got an automatic deduction it goes towards the Indiana teacher retirement but then they've got like a 401k on top of it and that's what we were considering you know we'll do the fifteen percent either now or you guys after we pay the health of how old are we on 42 she's 36 okay 36 so let me just do some math here i'll pull up our investment calculator because what i like to do is go okay what do all the sides look like of this equation so what you guys are saying we're going to give up is 650 a month for a year so $7800 right yeah so let's say that we just we had that 7800 and it was growing for us for

36:36the next 20 years now you're 62 she's still a young sprightly 56 right right right i'm going to give it 20 years to grow i'm going to say 10% average annual rate of return no monthly contribution just that pile of money growing for 20 years that's really what we're giving up that's the opportunity cost we're talking about in order to pay off the mortgage a little earlier so i'm going to calculate it's $57,000 yeah so that's the the actual numbers we want to compare not just well 650 a month we're just giving that up we're actually giving up close to 60 grand to make this happen a little bit sooner so what i would do is say all right let's say that she did invest 15% how much does that slow down the mortgage payment when would you guys pay off the house so so from what i'm seeing we'd uh without doing the 13th at the 11 or 12 months we're doing it it'd be like maybe 16 so it's not that much longer i know it's not a huge huge deal so we're talking four months apart and then here's my other thing and this is where my brain goes i go okay how do we make up the gap

37:41how do we put that much extra while she invests to still pay this off and under a year what am i willing to do yeah side hustles work harder cut expenses make other sacrifices to not derail our financial plan because you guys have worked so hard to get here into unplug investing for a year just as a muscle you're gonna atrophy a little bit yeah that's what i was saying it's it's hard to come back dude yeah no i get that i get that i get that 50% to 20 30 40% once you guys have that mortgage paid off is gonna feel easy oh yeah yeah it's just like you're just adding a little more yeah no i get that can she tutor over next you know next summer can you do commit to doing something else because that's really what we're talking about is a couple of grand less than ten grand difference here yeah we can look into that or so indication this year or something or you know yeah it's the yeah and that's probably a good way to look at it is if we want to accelerate this there's gonna be some pain do we want that pain

38:42to be 20 years from now and we're like we can have 60 thousand more dollars in retirement do we want that pain to be we're gonna skip a vacation and we're gonna go camping somewhere in Indiana instead of going on a big trip this year what pain are we willing to endure short term so that we never have a house pain because we want to accelerate that thing and you might lay and on it's four more months let's just stay the course and hopefully also we gave you a good like ringside seat to i'm an over emotional guy i know that right and so i'm a super nerd who's like what are the numbers exactly George is like well future me is gonna really be sad and so the it's just knowing man i wish i wish with all of my heart i had with george has which is the ability to feel uncomfortable and then always do the next right thing i've been practicing that for a long time i'm trying i'm coaching right he's he's trying and i'm hopefully he wishes he had a little more fun like i do 100 percent so i wish i had hobbies like john does yeah yeah he wishes he had joy and laughter in his life like i do so like all i have to say is i i couldn't sit here and say

39:47you can't do that because i did it that's exactly what me and my wife did and she knew she's married to a person whose quasi insane about owing people money like it's a lived it's like it melts me and so for her she's like oh i get my husband back in a year yes whatever we got to do um that's like john is the little devil on your shoulder and then i have Dave rams you on the other side going you move from intensity to intentionality and baby step four through six so that's what i'm here to and i was intentionally intense right did you get you're going to be 43 and 37 with a paid four house like that's insane so if it's four months beyond that we're still going to cheer you on and go that is incredible and the fact that you invested the whole time is even more incredible so that would be my my personal plan would be let's invest 15 percent of our full household income for now and see how we can still hit our goal of not going to sound less in a year and i almost can guarantee it now i can't say it for sure you guys will pay this house off in a year while investing and can i completely do an oh one eighty of what i've been saying

40:50yeah i want to throw a third option on the table what if you and your wife sat down and said we're not going to do it in 10 months we're not going to do it in 14 months we're actually going to do it in 16 months and we're going to take a little bit of money each month now that you're back in the workforce full time and we still have kids we're going to hire a house cleaner i want to take you to a nice meal once a week i'm going to take the kids out and let you just exhale because you're not your surrounded by kids all day and you come home to market like you all begin to build in what kind of life do we want to have because in the same way in your home like in my house i'm psychotic about a couple of things your wife may be feeling the weight of back full time but i also feel this pressure to keep my old identity and and and and you all ask yourselves what kind of home what do you want your home to feel like and i would say even being in part of like like like georgia say and being intentional is we're going to actually do something create we're going to slow it down a little bit and we're going to go to eat yeah we're going to give each other a room to breathe she deserves it she's uh she's amazing just uh the sacrifice she makes

41:56these first couple weeks of school so yeah and go up man the classroom is different than it was 10 years ago brother it's different and so um yeah give her the love and care and support she needs ask her every morning of your of your life how can i love you today and man um be all about supporting you sound like a really good husband so we've we've given you uh pretty much no answer right i gave you the right one john gave an alternative so i think we're both you know we're both some yeah george gave you the right answer and i gave you the two alternatives the way i did and the one i probably wish i would have done there are no sins being committed here but the plan works if you work it and so we say four five six are done simultaneously and 15% is forever in fact once you pay off the mortgage you just increase investing but even if you had it you're like hey we're good on retirement we still tell people to invest because there's more impact to be made for your family for your community for the things that you want to do it's a good problem if you had too much money retirement you can come back and yell at me later even if you paid off the mortgage four months later on way to go man thank you

43:14okay george we hear from so many people that are trying to live out to the ramsy plan right they're getting out of debt and everything but the hard thing is there's not many banks out there that actually support the way we teach you but a handle money yeah most banks they don't want you to win with money so they charge a bunch of nuisance fees there's all this fine print and worst of all they are pushing debt products at you non-stop yes but the good thing is is that fair winds isn't like most banks they're not like the other guys they are not pushing debt and they actually want you to win with the baby steps and so what's great too is they created the smart bundle for ramsy fans which includes a high yield savings accounts and no monthly fee checking which is huge because it's rare to have a checking account tied to a high yield savings account you can get all of that with fair winds and for the nerds out there you can have a ten different high yield savings accounts for different goals so you got your emergency fund the car upgrade fund the vacation fund the world is your oyster so beautiful and check out the debit card the new one the live like no one else debit card it's so beautiful we that's a conversation starter it's so good well and when you swipe or you tap

44:17you know every time you take it out of your wallet you're remembering that you are living like no one else and you're being intentional with your money i've been using fair winds for months and months now i love their features the app the customer service it is all so good and so aligned with the ramsy principles absolutely so y'all we both bank at fair winds and we love their commitment to ramsy values so check it out you can get that smart bundle we're going to drop a link in the description or you can go to fair winds dot org slash ramsy today that's right that's fair winds dot org slash ramsy insured by the ncu a welcome back to the ramsy show and the fair winds credit union studio i'm George camel here with john deloney taking your calls at triple eight eight two five five two two five tomas is in new york city up next what's going on tomas hey how you doing great how can john and i help um so i currently on house hacking um i i'm trying to move i don't like my current situation

45:21because i'm in a little income area um i feel like my two options right now is one move out to an apartment in rent but uh i would write out my current unit or two which i was leaning towards is um just buying another property in a better area but continuing with the house hack so tomas i'm an old old man what is house hacking john hasn't been on tiktok ever she doesn't know i would not know how to log into tiktok yeah well what is house hacking unit so i live in one unit and i went to my other two units and i get rent for the mortgage is that what the kids call these days house hacking yes all right all right that sounds miserable is pretty miserable i actually hit it so let me ask you this so i was an early adopter back in 2000 like nine ten into this thing called biohacking and i used to there was no continuous glucose monitor so i'd prick my finger every morning and i was always peeing on ketone strips and i was

46:24keeping like these detailed excel spreadsheets and then one day i was like i'm biohacking myself into a life that i hate living yeah right and so then i quit biohacking you know i mean but um that so yeah i don't know George George knows more about this tiktok sensation what caused you to get into this house hacking situation i'm assuming you're a guy in your 20s how old are you um 27 okay what caused me to get into it i mean i just want to become financially stable i'm gonna diverge but like did someone tell you about this did you see a video and it sounded alluring and you started looking for multi-family homes i think i was on youtube a few years back um year i didn't like how expensive rent was and you know i'm always very fed better to buy them to rent so trigger a hack and buy okay what i want you to understand is that a lot of times the things that seem really cool on the internet are often going to destroy your life now you're not quite there yet but you're getting a little bit of that taste in your mouth of the reality of

47:28this was not what was sold to me when i bought the course or whatever and so i want you to realize that it's okay to opt out and you know what i'm gonna go rent for a while and just sort of reset i can sell this multi-family because i don't really want to be a landlord by default just because i thought house hacking was going to be the move and both George and i have both rented both married i've rented both my kids have lived in rented homes at certain times and we kept plugging away and our life is changed now you know what i'm saying like the fact that you're thinking about future you and you're trying these things tells me you've got what it takes to become financially secure you're not scared of doing hard stuff you're not scared of putting yourself in uncomfortable situations you're not scared of like like doing the next right hard thing so man all you need is a clear path it's actually gonna get you where you want to go and not get a bunch of clicks on some social media site right yeah so what are you

48:32making right now what's your income and what is the income you're actually netting from this multi-family if any my income like gross is 300 what do you do what's all for engineering a major 300,000 yeah you know who doesn't need to house hack guys who make 300,000 dollars a soft one dude you can pay your own mortgage like a grown adult you don't need people doing it for you that live next door that also knock on your door in the toilet breaks that throw parties I'm trying to let you know put myself in the best position Thomas you're in it do you have any debt right now um like 4000 students okay you can pay that off today you have that money in savings yeah I can today how much will you have left in savings after that a good amount like uh all 90 ten amazing so think about this today you will be consumer debt free with 90 thousand dollars in the bank what is owed on the

49:37mortgage on this multi-family I just bought it um like 18 months ago um I've almost not all of it it's like 650 six 50 is what is owed and it's about worth 650 seven uh I bought it like 690 right now I've got to get between 750 okay so you could probably walk away after fees with a little bit of pocket change if you sold it okay because right now they're just paying the mortgage like basically you're you're staying there with rent free yeah what's the cash flow like because you have a big old mortgage on 100 yeah I mean I'm like negative 100 after rent is collected so you owe 100 like like after I get one my rent I have to put like a hundred dollars of your own money okay so you basically have a very low rent right now but you have to do work as a landlord and deal with all the risk and liability and all that fun stuff yeah and somebody else regularly

50:39flushing your toilets yeah right so what is your actual dream if I could erase this whole house hacking thing we restarted today what does Thomas really want do you want to live in a single family home in a decent neighborhood and start a family of what what's on the other end of this yeah a nice single family home uh a nice neighborhood so by that set yourself up for the life you actually want what what's your what what was growing up um like what was money like growing up for you uh money wasn't um I wasn't going to find the next like yeah money wasn't there it wasn't I wasn't broke one broke you know money wasn't was it a source of tension yeah I mean we didn't my mother did a job so we didn't feel it I was telling you I'm not saying this as a character in anything any shade on anybody I'm just trying to get to a like because we're we're George and I are sitting you're 25 years old you make 300 grand yeah when you're 27 you'll

51:42have banked $900,000 after taxes you know what I'm saying like bro you're doing really really well now you're in the uncomfortable adult seat of slowed steady to imagine you go rent for a year even if it costs you I don't know two or three grand I don't know what it's going to cost in your area for a place that you like and you just live fairly frugally live unless you make should be easy on 300 grand with no debt you bank 150 grand on top of your 90 now you got some serious money you got 240,000 to put down on a house that you actually want you think I should like just buy this nice single family home that might never hit buy the home that you want because you don't need somebody to pay your mortgage that's not the issue yeah if you if you buy the house you want and you start building the life you want and a few years from now you want to get into real estate that's awesome man you'll be able to do that with cash buy the place yeah and then put two different

52:48families on either side of each other give them a great deal on rent to support them and man everybody wins you have a girlfriend right now yeah okay what does she want for your future together oh yeah nice family home she wants that duplex life I think you know what to do man and you're in a great position to do it but it all it takes is putting this house on the market and going well try that wasn't for me wasn't for me that's why you should get into radio because your voice is way better than smooth godly I would love to have a voice like that this show is sponsored by better help a lot of you are just trying to keep it together all the time

53:49you show up to work you pay the bills mostly on time you smile at all the right times but no one sees you when you're exhausted no one sees you snap at your spouse or sit awake at 2 a.m. running through everything you wish you'd done and said differently during the day just because you're functioning doesn't mean you're okay talking to someone else is a great way to process what's happening in your life and get to the root of what you're experiencing that's where better help comes in better help matches you with one of their 30,000 licensed therapists someone you can be real with and finally put down some of the weight you've been carrying they can help you get perspective and see other sides of your situations and help you move forward with a plan for getting well better help therapists all follow a strict code of ethics and if the first therapist isn't the right fit you can switch for no extra cost asking for help isn't weakness it's wisdom and strength if you're exhausted from always having to hold it all together trust a better help therapist to help you carry the load go to betterhelp.com slash ramsy for 10% off your

54:50first month that's better help h-e-l-p dot com slash ramsy James is in rolle north kira line up next James welcome to the show we're doing great how can we help today awesome hey let me just start by saying I'm a little bit relieved and a little bit disappointed that I'm not talking about days today because I knew Dave was going to look my tail we can do it we'll dive a little for you man we take a tail with my Dave too so we know look John I listen to you all the time bro I'm a pastor and I sit with a lot of hurting people and man I've cleaned a lot of even I don't want to say tactics the technique there's how to

55:54how to sit with people for me so I appreciate you bro you got it man thanks for calling how can we help him yeah so my wife and I've been married 14 years my wife is amazing we have six kiddos 10 down to one I am a pastor of a of a growing church and I also run a small business and and kind of in a spot we've allowed ourselves to get kind of back into a spot where we're in a got a good bit of debt and we have an income issue but at the same time I also have just a a time issue so anyway we're trying to get started back on the baby step and get out of debt and so it's just in looking for maybe a little bit of help with us as we're trying to get started and but what kind of debt is this and how much yes we got about 70,000 consumer debt is about 30k and a personal one uh two grand we owe to the local county we're paying on tactics for our land

56:59um we have about five grand over two different credit cards and then 16,000 in a truck a bolt last year when I was starting the business and now also a 8,000 for a enclosed trailer a bolt as well for the business what's a small business yeah so I do a light remodel and any man that kind of stuff what did you what did you report last year how much did you make about 60 yeah about 65 and it was about half a year I was doing it full time the other half the year one really not even other half in in November I actually stepped a really about 10 month to the year I was in a full time in November I stepped in as a lead pastor at church and so I cut back to about two or three days a week with the business I'm honestly not not sure right now if it's worth it what what is your salary as a minister 60,000 okay so you were making 125

58:07are you making a grand a month doing this now with a side business yeah yeah it depends honestly for me and Mike July June July was maybe a grand um August will be about seven grand because you're yeah on the months that are bad you're bleeding money from this thing just trying to make payments on the truck and trailer and was the 30k person alone for the business no that was uh we moved about two years ago and purchased a piece of land and put the land on it and just where we live we sold our house and just lifestyle we moved out of the city moved out into the country to raise the kids that way and okay yeah so we ended up we thought we could cash flow it off the cell of another house and it just uh once we got in it we couldn't so we ended up getting a personal under finished drilling the whale and that kind of stuff does your wife want out of this debt are you guys ready to go back to debt freedom like how far in oh yeah we're locked

59:12in we're together we're locked in but like I posted my truck yesterday wow well here's the other I don't know here's the other side of it is you you all sit I mean you can't get through this without sacrifice nor really sacrifice right right it seems to me and it pushed back on me man and George she told me if I'm wrong you happen to have a key in your back pocket which is I can go turn a key and I will collapse at the end of one calendar year but I can make another $65,000 on top of being a pastor here and get my family cleared out of this mess potentially this is I think this is where I'm struggling I've got the church in the last year has has doubled um the Lord's doing it's the core work and it's doubled and you know in the last nine months up then five funeral and walk with folks after they're become widows because the spouse

1:00:13committed suicide and the church the church is demanding more time from you now so you don't have time for the business which is producing the income that you need to pay off the debt is that we're getting that and I have six right and I have six kids so so here this is my kids are my first ministry this is one of my wrestling with all of that well this is one of my like top of the top five hard conversations I have to have this is one of the the hardest okay this is up there in the top five you you want to be a pastor you might even use the language you were called to be a pastor and by all accounts like all what I would call an a hate hey using these but by earthly metrics you're pretty good at it you're creating a world that people want to be a part of you're you're not creating it you're help facilitating a world right you're good at it and you and your wife dug a $70,000 whole yeah and so at some point you're going to either have to pause this dream and this calling because to clean up decisions that past you has made or you're

1:01:19going to have to look at your wife and say I've got six kids and this is my priority and I'm going to show give them a ringside seat I'm going to show them what it's like to clean up a mess you've made and like I say you will be spent you will be a wrong out rag at the end of a year or you get with your church leaders and say here's the here's the situation I've found myself in right but like I hate that you're in this position but that you've got a math problem in front of you get what I'm saying yeah yeah for sure and and one million percent like we put ourselves in this position though I mean we're there oh I hear you I hear you I know that you've taken full responsibility so no that's why we're not going to beat up on you because and Dave wouldn't either because you're not a guy who's not seeing it for what it is you know what you did you know the way out and you're going how do we do this and we're giving you the roadmap it's just not a fun one to say hey man you got six kids and you're going to miss out on some things over the next year as you clean this up but the other side of this is you do nothing you go into deeper debt now you got kids who are

1:02:22two through eleven and you got a bigger pile of debt and so kicking the can down the road is also not going to solve it so the best way to get out of this debt is just go through it and go all right if I can make 70 grand doing this side business plus our income we can knock out this dead in 12 months yeah and I mean there is a there's more work works definitely not the issue I mean I can it sure you can draw much more work out there or you and your wife say hey this is a two-year project and I'm going to make 30 grand a year and every penny in the side business is going to go to towards our debt every penny which means we got to learn to live off our my 60 thousand dollar ministry income yeah well and and something we did last year which I'm or this year which I'm with the right decision but just kind of added a complication is during covid because of I've been in ministry for a while but what's kind of the associate pastor but during covid we got food stamps which yeah of course I would never want to be on or even tell anybody I was on but

1:03:27we were and so man with as many kids as we have we were getting 900 books a month and we we killed that this year we're like we're done I started the business now I'm we no longer eligible and we're doing yeah we're gonna turn anything in we're walking on up and up and we're gonna sacrifice that we've also got like a ten thousand dollar pay cut in some stamps this year from as you're covering the right now but bro yeah but it and it was worth it my wife and I talk about it all the time like praise god we are not well now you're in control yeah and can I have permission to Jesus to you James okay here it is Proverbs 227 you know about a thousand more verses than I do the borrower is slave to the lender and you knew that but now it's a stark reminder that that lender owns your time that you could have been spending with your kids so it's not the side jobs fault it's not the church's fault it is man I'm so mad at the decisions I made and the lenders I have to pay and I'm gonna get out once and for all and never go back in which means

1:04:27cutting up the cards selling the trucks selling the trailer and working your tail off to climb out of this thing for true freedom we're rooting for you as your business grows everything becomes more complex there was a time when Ramsey solutions had too many disconnected systems and not enough visibility across the business we wasted too much time chasing information instead of making decisions that's why we got net suite net suite brings your financials inventory CRM and more together in one place more than 44,000 businesses run on net suite

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1:06:33and normal is broke sadly you don't have to live that way our every dollar budgeting app helps you find extra money every month and build you a personalized plan to beat debt and build wealth and in just 15 minutes you'll find thousands in hidden margin and you'll feel like you got a race so don't live normal live like no one else start every dollar for free in the app store or google play Sarah is in DC up next Sarah welcome to the show hey thanks for having me nice absolutely how can John and I help um so I have a timeline question for you all today um so I am fairly newly engaged and Mike Yonsey and I are you know sitting down for numbers and we're keeping things up for it for now but plan on planning and combining which is kind of planning for all of that um and we are currently in more rental apartment um and want to know about saving for a wedding and a down payment for a house with kind of a few little asterisks to uh the the grand scheme of things so I we one of the like

1:07:41major sacrifices that we've made to try to pay off um all of our debt is staying in um um uh fairly small and all apartment that's not super conducive to raising children in um my fiancee is in the police department so we actually live in a not so great area that I wouldn't feel comfortable bringing a you know small child into the home um but in return for his presence as a police officer and some of the people on the side for them um we don't pay much so obviously that is um a huge blessing um and had allowed us to pay down our debt but I don't want to have children um I'm about to be 31 and so we would like to start on children certainly after getting married um once the wedding yeah that's so we haven't said a date yet um part of doing that is setting out our financial goals because we like if I'm saving up for the

1:08:42wedding is sort of part of this timeline question okay and how much debt do you guys have left separately so he is almost done he has about three thousand left in student loan that's it um paid off the credit card paid off the car awesome um so he's set he'll have that done in like a month or two right um I have eleven thousand in my car loan and then I have two hundred and fourteen left in my student loans which sounds scary but I started it over a hundred or over three hundred thousand total so it made a lot of progress are you a physician I am an overnight emergency veterinarian okay kind of the second caveat to that is the longevity of my job yeah um you know I I love what I do and I wish I could do it for forever but my body tells me that I cannot do overnight for forever especially an emergency yeah and I'm worried about

1:09:42probably needing to take a pay cut when we start having kids um I could work as a regular veterinarian and probably still make a hundred and sixty to a hundred and eighty in this area but it would it would be a substantial pay cut obviously so so I'll let George speak I have some ideas but we'll wait so the overall question we're asking is when do we make the move where do we go should we rent should we buy so I would love to buy that's the preference but yes if you have thoughts on that would be great um my question is when you stop aggressively paying down the debt which I mean I'm putting like close to eight thousand dollars every month into my student loans right now so when do I divert from baby step two to try to you know do the things that are needed for the next steps of our life without putting it up too much on hold next steps being wedding down payment all that yeah okay well I'll give you the

1:10:47simplest answer which is you are not going to stop being aggressive on the debt but you should pause and save up for the wedding and do something reasonable now is it just on you two to cover all things wedding or is family helping um it's probably just on us okay then I'm going to do the smallest tweeting make it it just called an intimate wedding it's cozy you don't need a hundred fifty people there because you're you're basically paying for them to party at a hundred bucks ahead yeah we're talking about that we're we're planning on doing something small and reasonable okay and the reason I'm not like you got to get married tomorrow it's just that once you guys are married you're gonna have a superpower which is combining your finances and your goal and your vision which is going to move everything faster because if you had all of his income now he's debt free throwing at your debt well now we can make some progress fast it's not going to take you as long you're going to get done in less than half the time and so that's where what the focus should be which means we are renting for the foreseeable future until we are completely consumer debt free we have an emergency fund we have a solid down payment because what happens for people

1:11:50in your shoes you guys make great money you have the baby and all of a sudden you want to cut back and you can't because you have a huge pile of debt you have a huge mortgage you have nothing in savings and now you're frustrated yeah you're scared and so I'd much rather do this with peace and just rent for a while with your incredible incomes even if it's for three or four years that's okay I guess does that I'm nervous and very hesitant to put off our family planning and children oh I'm not saying that have a listen I'm telling you to have a baby and when it that time comes you guys should move and go rent somewhere even if it costs you money or every single apartment or condo I've ever rented had some police presence is there a possibility that there's nicer apartments nicer places somewhere within a 30 or 45 minute radius and we're all both work that that would be a possibility so probably not like I mean yes we could move and like rent

1:12:51somewhere different like that definitely obviously things but not in the same setup where we would not pay rent or a subsidized rent they so they do exist as a program like through the department okay but the way we got this one and it was essentially like handed down to us from so what would rent cost if you didn't have any subsidies if you just had to pay for rent some are reasonable a nicer place what would it cost probably like 2500 to 3 grand we live in a pretty terrible housing area the housing market's awful okay and if you guys are married at that point you guys are bringing home my guess is maybe 12 to 15 grand so our take home combined is on about 16,000 a month amazing so think about that 2500 out of 16 that's not the thing that's gonna hold you back from paying off debt and you have a higher quality of life which means when

1:13:54you come back from a long day at work you can rest your head somewhere and feel good about it and sleep better yeah yeah I know this it feels like I'm climbing a mountain or sleeping under it currently well and can I can I can I say some hard things because I love you and I want you and your husband have an amazing life and have 50 kids and have the everything you want is that cool yeah of course it would be really advantageous to you and it's a it's a it's a psychological exercise as much as it's a spiritual exercise right down all of the things not need all the things you want and what you're gonna find is you want a whole bunch of things and everything you've said so far you wanted you want a nice house you want a safe place for your kid you want to have kids right away you want to get married all those things are amazing they're all awesome I support each one of those a million percent but you also wanted to take out 300 grand to go to school

1:14:56yeah and so that particular want that you gave into is now holding you back from all these new things that you want and so let's sever ties with that old want is fast as humanly possible so we can get to the life that we want now but trying trying to cram the things that you want now into uh already existing mess will make everything less peaceful enjoyable life giving and what ends up happening is we want to blame everybody else you looking in the mirror and saying I I thought I had to nobody told me different whatever I took out three hundred thousand dollars so I'm going to live like a maniac getting the stuff paid off I'm going to get married and have a really small wedding because I don't want to spend 20 grand on that I want to spend 20 grand on two more months of paying off my student loans well of a different party in two or three years but we are going to attack this thing so we can get into the life that we actually want

1:15:59so hey guys it's Rachel Cruz if you're working the baby steps every major expense deserves a second look and health care is one of the biggest expenses in most families budgets and that is why I recommend that you check out Christian health care ministries CHM isn't insurance it's a health cost sharing ministry that means members help pay one another's medical bills and they've been serving Christian since 1981 CHM programs start at just a hundred and fifteen dollars a month and here's why that matters if you are paying more than you need to for health care that money could be going toward paying off debt building your emergency fund or reaching your next financial goal and your monthly cost isn't based on your medical history or where you live y'all a lot of families fine CHM

1:17:03gives them more room in the budget that's why so many members say they're better with CHM and right now new members can receive a 50% credit towards their first month of membership go to CHministries.org slash budget and use promo code Ramsey that's CHministries.org slash budget and promo code Ramsey today's question of the day is brought to you by YRIFI if you fall in behind on your private student loans you don't need more shame you need a plan YRIFI helps borrowers explore refinancing options with a low fixed rate and payments based on what you can afford go to YRIFI.com slash Ramsey may not be available in all states today's question comes from Antonio in Florida Antonio writes my wife and I have been on separate pages regarding credit cards she uses them to

1:18:06play the points in miles game but I'd like to get rid of them she's recently started realizing how much work it is to manage all the things that come with the credit cards and also wants to get rid of them but is worried about destroying her credit score is that something we should be concerned about no thanks for the question and Tony that was fun oh see here's the thing I don't think our answer is going to be satisfactory because it needs to be a lived experience us just telling her you're gonna be fine probably won't be enough and I wrote about this extensively in my book breaking free from broke a whole chapter on credit cards a whole chapter about what I call the perfect spender the points for Deemer the people who are like I'm playing the game perfectly why would I stop and now not only that but why would I stop when it could then hurt me to stop because of my credit score so what you need to remind her is that a credit score allows you to get more debt at good terms so what else are you trying to go into debt towards and how does a credit card actually help you move forward financially and once you realize that it is a game that it is

1:19:11a maze and at the end you're like where's the cheese like oh no there's no cheese they expired you just keep there's another maze now you just keep doing this until you die and so I'm glad that you're realizing that this is a game and that she's realizing hopefully that this is a game and it's just this was fun but you're saying she wants to get rid of them so here's the thing you just get rid of them your credit score might take a temporary dip and then you move on with your life and you pay cash for things using your own money and that is where you get so much freedom that you can't I can't explain to someone how good it feels to not use someone else's money um well let me let me because I was going to say um Antonio your wife's right it will destroy her credit score it'll go to zero it'll implode it I would say it doesn't matter but you're saying it just a little dip yeah I mean if you immediately like you pay it all off you close the account you'll see a dip in the credit score now the question is it's not going to be like that forever six to 12 months after you have no accounts open it becomes indeterminable so if I want to check

1:20:13my credit score right now it would just say ain't nothing here bud we don't got any records of you right I'm off the grid basically that's like me looking up like what is my score on like a dating website I'm not on that's it so it's the only major thing people get worried about that is legitimate is well how am I going to get a house and there's something called manual underwriting we've talked about it a lot on the show and it's like the old times before you know the the late 90s when credit scores were all the rage you just went into the bank or the lender and said hey here's my income I don't have any debt here's my down payment here's my rent you know payments that were on time my utility bills have been on time and you can get a mortgage without having a credit score and again this not theory I've done it and so I've done it too and before every human became commoditized and reduced to three digits a number right that some computer spit out and said this is this is your risk profile to us as a big entity yeah man mandrel underwriting they actually look at you and your actual situation and in Tonyo that I'll tell you the two things that we're convicting to me about credit scores um thing number one is it has zero nada no bearing on your financial position

1:21:22meaning I could give you I don't have this but if I found it and I gave you five a million dollars it would affect your credit score in zero ways and so we we've suddenly over time this extrinsic metric called a credit score we've allowed it to infiltrate not only are borrowing and lending world but are self worth as some sort of proxy for how are we doing financially I hear so many of my friends and even family members say well I want to keep my credit score because it's this and they never say here's how much money I have in the bank or here's my net worth even financial net worth they just want to keep this credit score up it's not a proxy for how well you're doing financially at all it's simply a proxy for how much of you barred in the past and how good did you manage that relationship that's it the second thing is and and this is me getting all high in mighty um and George you know I've talked about this um just privately I mean I was big on having a

1:22:25credit card using it for the free points I travel a lot and I didn't want to pay for flights and I would pay it off every month and I lived like that for a long time I remember the aha moment when I got a bunch of points for a huge purchase that I got reimbursed for that I thought wait a minute they're not my friend they're not just hooking me up they're not a charity who's paying for these flights and as I dug into that that's when I said I'm out of this game because the people who pay for that that flight are the folks who are struggling to pay their bills every month who are paying over overdraft fees that's what's funding my free hotel rooms and flights and I don't want to get a free flight on the back of somebody who's struggling like that so I'm out I'm out if I want to go somewhere I'm gonna pay for it and if the if the airline I use or the hotel I use they have their own point system like if you use my airline system air in my airline will give you free flights over time great that's between me and them but somebody who's struggling isn't funding my good

1:23:25times I don't I don't want any part of that kind of gross system I got the numbers for you here John this is in the book and in this chapter on credit scores and credit cards lower income card holders paid 4.14 billion in fees just that year those with higher incomes raked in 1.26 billion in rewards that's pretty wild so lower income people are paying 4 billion in fees and the rich do get richer because they're raking in those rewards the credit card company is not blessing you they're just simply redistributing that money right from in so in my head there's a single mom who just husband just or whoever the guy just walked out and she's got to get groceries and she puts them on there and that same month her hours get cut and they charge her $35 $75 late fee that's what just bought my flight I'm not a no way dude right no I don't want I don't want to be a part of a system like that so I'm just gonna opt out man oh I'm riled up now Antonio cut him up you know how to move on your life Bella's in Sacramento up next what's going on Bella how can we help hi guys I am so excited to talk to you guys I've listened

1:24:28you guys are like celebrities in our house well we don't get celebrity somewhere we're not celebrities in our own house or on the internet so thank you so much so yeah I never thought I would be calling about my dad um some of that who's always been very meticulous with money like check blood but he's old school so he does you know have a credit card with points he has multiple credit cards and now we're in the position of having to make decisions for him because he's starting to suffer from dementia and so yeah he's had this serious card for I don't know how many years racked up like six figures of reward points and I guess recently city bank bought out sears and so when they began sending him statements he didn't see his reward points that held so much value to him now he's suffering from dementia so he doesn't understand now that it's not money it's reward points and so he's thinking city banks go like $120,000 from him

1:25:33yeah I'm like that you can't even have that much on a credit card but I like how much does he owe his card so now he owes about four thousand I tried to talk to them he stopped paying it because he thought they were stealing his money oh no I tried to talk to them and tell them hey we're trying to figure out a way to help resolve this he doesn't have an income any longer they're just not moving and so now they just served him with a thumb and twercourt which doesn't have a court you know and it's I don't know if they're threatening him but I just don't know as a daughter like what options I have to help him out of the situation I've never been here before so I'm guessing you don't have financial power attorney yeah not yet we're all in the we're all in the process like now that we're starting to really obviously see that our dad who we've looked at you know up to like suffering from dementia we're like oh wow we need to start getting things in place yeah get financial power attorney as soon as possible okay okay and you can try to settle with them

1:26:36explaining the situation and I don't know how much the courts care about his health the credit card companies just want their money he's just he's just an account number to them and so you're gonna have to fight this and explain what's going on you could settle you could just let it go and they try to sue him and the debt stays on and whatever at that point or you can go to court with with your father who's got dementia and say here's who they're beating up on judge I don't know what that would get you or if you look and say hey we he actually owes you three thousand bucks you and your brothers are gonna come up with that money and help get clear that debt because he did take that money from them we're gonna clear we're gonna close this account that might be the path forward and I would contact our friends at guardian litigation you can go to guardianlit.com slash they help with exact situations like this good luck Bella. As a frugal guy I am always looking for entertainment that is worth what I pay for it and that's not always easy but angels newest movie definitely passes the test it's called runner and it might be

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1:28:37welcome back to the Ramsey show in the fair winds credit union studio I'm George Kamel here with John Deloney taking your calls at triple eight eight two five five two two five Dan is in Minneapolis up next Dan welcome to the show thanks for having me absolutely what's going on with you oh struggling a little bit here talking through it um so currently um I have a newborn baby 10 months old um my wife just found out she's losing her job oh man and I just started a new business whoo perfect storm yes was there severance with her job what happened um so she actually is an online telehealth nurse um and they had a meeting one day with 200 employees on the zoom call

1:29:38uh they CEO of the company hopped on and said hey if you're on the zoom call you're all going to be losing your job and if you have any questions take it up with HR and hung up the phone call wow what a coward I hate that for her then after that I guess they had an employee group chat or whatever everybody was on their talking in three minutes after the call they they shut down the group chat yeah yeah I'll talk to each other and what do you do for work um so I actually I just started a concrete um and asphalt paving business is that full time or do you have a different job while you have the side business happening running yep I do have my full time job as well um that I do like heavy equipment operating all right I'm gonna I'm gonna cross my fingers here please tell me as you started this new business you didn't go also leverage a big truck and a dump truck also and a front loader as well no luckily um you know I just started listening to you guys a

1:30:39little bit of background um about me I grew up on an Native American reservation as a kid my first memories my dad was abusing my mom um grew up learning everything from my mom after they got divorced and then when I joined the military she was ended up actually stealing money from me while growing up so then I kind of ran off did my life lived lavishly enjoyed our time and stuff like that well after her and I got married my wife and I should say got married I found you guys on YouTube started watching the smart money happy hour um and the John Deloany show yes became big fans you guys so then when I started my company this summer I told my wife I said I'm just gonna cash flow the business awesome as of right now my business has no debt but we still have consumer and personal debt dude that I know that's a tough season you're in and that's but you didn't make it worse so I'm proud of you for that man like that's like I have my fingers crossed because almost everybody in your situation does the opposite so well done for literally just this

1:31:43moment right yes just this one awesome dude awesome so how much are you bringing in from your full time job in this side business right now every month so my my full time job um every month well I make about a hundred thousand dollars what I actually um holding on taxes last year that was before the new job and I'm just kind of getting the balls rolling getting some jobs coming in and for September here it's looking like the concrete side job is going to be bringing in probably about 12 to 20 thousand dollars profit that's fantastic how how are like reliable is that can you consistently make a certain amount of a month doing this um in Minnesota pretty much just a summertime so I have maybe some jobs in October and then after it freezes up I'm pretty much on standby until next spring so we got two more months to really hustle yes okay and they tell us you got 10 month old right yes okay what um I guess nothing is good about what happened with to your wife the the the

1:32:46complete lack of humanity her employer showed um the way that was done all of that cutting off her like human connection with her colleagues like all of that was disgusting and gross at every level right um yeah and and that's good there's gonna be a season of grief for that your wife and you are gonna be right to be like skeptical of trusting businesses and in boss all that's right and I'm trying to look for some light here your wife has right now what I would say is one of the hottest credentials which is a nursing degree right yep and so what does it look like for y'all to sit down and say how much debt do we have we didn't want to put we we uh uh uh she had a work from home job which was awesome um so your picture is gonna change but for one year if we put our daughter and we get some childcare could your wife go work full time and get all these debts paid off so that y'all can then go about living on your hundred grand plus whatever else you bring in yeah that's a possibility um I've been working hard ever we got married in

1:33:522024 and starting in 2020 for her and I combined together we had two hundred and thirteen thousand dollars of debt that's no home that was just a camper we lived on the road while she was a traveler my pickup truck toys and her student loans um over the last two years uh we've been buckling down trying to pay it off and we're at one forty three one hundred and forty three thousand dollars in debt right now okay what's left i'm selling go ahead what's left on that is the um we have three credit cards a car or two cars technically and then my truck and camper okay did we still need the truck and camper at this point or using the truck for the business no you guys might like this I actually just shook hands with the guy and i'm selling the truck and camper tonight when i get off the phone here oh boy how many the lead man yeah so i mean i'll be about ten thousand upside down on it but we can attack that pretty quickly

1:34:55I feel like so that will leave us after that sale i think we'll be about sixty seven thousand left in debt dude that's great what a car's worth yeah you're awesome man could you continue this with the car like just do the snowball of selling all the things with wheels and motors in your life yeah so with that deal actually um i got a work truck for my company i'm actually going from a forty thousand dollar truck down to a twenty five hundred dollar truck with rust on it but it's like i'll make more money that it should be i had a boy damn um and then my wife's car we traded her she had a twenty twenty four car we just traded in for a twenty eighteen to make it more affordable um so she can get around as well okay so look brother like if you go down to sixty thousand dollars in debt that's literally her work that's take home for her if she goes all in for one year plus child care yep and if y'all make if if if she doesn't want to do that you don't want that that little baby right is is it's ten months old for god's sakes um doesn't know what day it is right like doing it if y'all if y'all shake hands on one year of hell one year of it not looking like

1:36:01you thought it was gonna look you are free forever yeah you'll do the business because you want to not because you have to your wife could stay home if she wants to or she can keep her it's keep working full time as a nurse because she loves it and y'all y'all y'all get on with it man but you're talking one year of sacrifice one when you're left dude and y'all free like you feel great you're free and can i i got to tell you dan i got to tell you you grew up in black hole hell right yeah and you as a man have turned and faced that hell and your kids i'm getting goose bumps your grandkids are not gonna know what that's like because you turned and stared it down it's an absolute honor to talk to men and your wife is involved in this men women who are saying this trauma ends with me and from now on my family's gonna be free

1:37:26hey George camel here so you're thinking about buying or selling your home it's exciting but there's a lot to think about and all those decisions can feel overwhelming well here's the good news you don't have to tackle the process alone ramsie's real estate home base is the place to find all of your free tools and resources for help to get prepared to buy or sell your home with confidence you'll find calculators start to finish guides a podcast and even an in-depth video course hosted by yours truly what's not to love so if you're ready to take the next steps toward your home goals go to ramsie solutions dot com slash real estate that's ramsie solutions dot com slash real estate welcome back to the ramsie show i'm George here with dr john taking your questions at

1:38:31triple eight eight two five five two two five ron is in Denver up next ron welcome to the show hello dr john deloni and George how are you doing today we're good ron how are you man i'm doing great thank you so much just want to give you a shout out dr john because without your advice and wisdom i would have never moved my wife because she is out of my league so thank you wow john gave you the confidence well i'm yeah i'm so far out of my league dude that welcome to the club it's awesome thank you thank you so much for your time you bet you just get straight straight straight into my question so she wanted to do a little debate between my wife and i see who see uh i guess which way we should go so i'm 30 she's 32 and we have a condo that we're about to sell should be netting around 160 to 170 our only debt is about 34,000 on a 401k loan and

1:39:31everything else is paid and then we have on our home as well we bought it last year we have a 321 buy down rate to buy down and it turns back to up to 6% in about two years and so what she's we can comfortably afford the payment today but my wife worries about what happens if we lose our job her family lost their home a wall back due to debt so it is a real fear for her and i totally understand that and so what i want to do with it is build a basement but she wants to recast the home so we're just a little uh yeah so just to make sure i'm on the same page you'll have a home and you have a condo and you're selling the condo correct yep okay and you're gonna net 160 and you're gonna immediately pay off this 401k loan so you'll have about 125 left right yes okay and so how much is your mortgage on your current home uh right now with the with the buy down it's about 3500 with

1:40:35and it's gonna go up a percent every year so that payment will increase correct so at the very end that 6% it should be around 4500 how much do you owe on on your current home uh five around 580 and then it's worth around 750 okay and what's your household income did i miss that yeah so right now our base salary is around 330 and then with bonuses we're around four four fifty-ish depending on performances incredible income okay so what's the what's the ultimate goal here like when you guys sit down what like a year from now where do you guys want to be what does your life look like we've left a year from now uh i think it definitely have the 401k taking down have some peace i guess uh but you know i i feel i feel like we could have peace in the basement and turn off the 401k loads so paying off the 401k loan costs you what out of your net

1:41:35profits 37 yeah okay so you get your 170 out of the condo you pay down 37 you still got a nice pile left what is the basement gonna cost around 50 to 60 okay you pay that now you still got money left then what and then she wants because she the thing is that she's really scared about you know just in case we never know what's gonna happen with our jobs and i i don't feel as though we don't there's there's some good job security and what we do you'll have six months of expenses saved right we do yeah we have about 40,000 so why don't you get on you all make 400 grand a year why don't you get on a two-year plan and i don't know how y'all are gonna do this it's gonna be tough but you'll just live on two hundred thousand dollars a year and take the other 200 grand and pay your house off in 24 months and give your wife freedom and peace mm like i do like that you're you're 24 months away from this not this being a nothing burger the recast makes you feel better but it didn't really do anything it's gonna lower the payment

1:42:39but it does nothing for the balance mm okay so recast you're gonna take a lump sum throw it at the mortgage and then you can recast it and it'll just re-amortize so okay and by the way if you did that today your recast would be at today's rates which are gonna be the penalty point of the rate you have in three or three to five years or whatever it is mm okay i guess i never thought about that but what if we just said screw all of that thinking and you look at your wife and say i want to take 200 thousand dollars a year and pay our house off in two years after we put a basement in it we take the other 60 grand we put it towards the mortgage directly bring it down and then we're gonna pay the sucker off and they were getting no one can ever take our house from us mm that is that i mean yeah it sounds great i think it's uh you know it sounds very easy no brain uh it's just you know two years from out here's a deal brother here's what your wife is saying i have the lived experience of not being

1:43:46safe and i want to feel safe and the way she's trying to achieve safety is moving money around which is completely understandable if you look at her and say i'll show you safety i'm gonna be disciplined and safe and i'm gonna propose a plan that i want you to speak into and together you and me right or die will get this thing paid off in 24 months which means i'm gonna not do all of my crazy whatever is and i'm not gonna spend on this and blah blah blah i'm all in because i want you to walk into our home that nobody else has a stake to and just laugh because it's ours that's what she's truly saying to you i've been unsafe before i've lost my house and i never want that feeling again and she's just getting on youtube or going to a local place and they're telling her well you could do this and she's you've got a wife who is who's who's in deep water and she's saying well somebody reached down and grabbed me what she wants is stability and a plan and a guy who says i'm all in on helping you feel safe in this home through action not through feeling you

1:44:49got what i'm saying i do and thank you for that advice that's why i very to her thanks for advice again i was gonna let her the two two listens to this as well so do you guys do a monthly budget together where you sit down and she has full awareness of what's going on with finances correct yes we do it a little more than we lie to we do it once a week oh wow she knows her for you it's usually for me okay stop you're bearing her hmm you're bearing her your love for numbers is gasoline on her anxiety fire around numbers hmm i never thought about that you get what i'm saying you all make a plan every month and stick to it okay and then if you want to play with spreadsheets in the middle of the night like i do like i know George does oh my god then do that my favorite guy in Somnia spreadsheet in Somnia so you've got the plan and this is more it's more emotional than reality because you get your income is so high even if one of you lost your jobs you're gonna be okay you have no debt and emergency fund the chances of both

1:45:54of you going without work for years is that's paranoia at that point right so you can decide um do you want to give your wife a gift of putting a hundred and thirty grand down on your principal of your mortgage and bringing it down really low and put off getting your basement for three years or two and a half years or do you want to say hey this baby's baseman's gonna cost 60 grand the other 60 is going to go directly to the principal and here's a two year plan to pay off this mortgage we're going to do this together you also don't have that conversation because that's more George that's the that's the actual issue here is there's no real clear plan about what we're doing and why we're doing it yeah it's just that every week she gets dragged to the table to relook at numbers and what about this and what if this happens which for her is just oh it's it's more of it her body's like I told you we're not safe I told you this could happen I told you I told you I told you and she's lived it man and that's a very man that's a real experience so good for you Ron for caring about her and for asking question in my house my wife has full you know transparency into the finances

1:46:58she has the accounts on her phone but I just become like a human version of that and everyone's in a while she just goes how much we haven't savings I got here so much and she goes okay that's it it's just that's what you want your finances to be well it was funny in my house it's the opposite occasionally I'll be like I'll tell my wife hey we have this much in savings and she'll be like have you not been sleeping again and I'll be like yeah no I haven't so it's it's me trying to make myself feel better by acting like I'm a tough great husband communicating she's like I know we're good you can't save your way out of psychosis John listen I don't want to be the one to trust me be your armchair therapist I know that's what my real therapist said yeah

1:48:12Dave Ramsey here for more than 30 years I've been talking to folks on the air and I can tell you that most people are broke not because they don't make enough money but because they don't have a plan you need to give every dollar you earn a job because when you do that something changes you stop guessing you stop worrying you stop stressing our every dollar budgeting app will show you how to find extra cash pay off debt and finally start winning with money but most people won't do it they'll keep living paycheck to paycheck keep hoping things will change without making a change it's time to say enough is enough it's time to take control of your money it's time to start your every dollar budget for free today go download it in the app store or google play bye

1:49:12buying or selling your home is high stakes because one bad deal could cost you tens of thousands of dollars you don't want to overpay for your next house or sell your current home for less than its worth and that's why Ramsey trusted connects you with vetted real estate agents who have the experience to guide you step by step to make smart decisions not expensive mistakes you can find a local Ramsey trusted agent for free at ramsey solutions dot com slash agent or click the link in the description if you're on youtuber podcast heath is in Columbus ohio up next heath what's going on hey guys appreciate take my call absolutely what's your question today ace so I've got a situation with my in laws they are in their mid 70s and during covid my father-in-law gambled away all their savings and so how much was it yeah so they you know I don't know exactly they had worked their whole lives and my mother-in-law where she got some inheritance from her parents when they passed away their parents were very well off so I'm assuming he was several hundreds

1:50:14thousands of dollars but you know I don't know for certain how much it was and they've been working full-time you know for the last couple years but they're getting older and you know my life and I are trying to figure out like what's the future and what's our role going to be in all this I've got five small kids at home and we're person at the seams in our place so unless we move or add on to our house like them staying with us is not an option and but you know their other kids are not really involved so it's it's gonna fall on us the burden is gonna fall on us are the other sibling they're strange when you say they're not involved uh yeah yes and now it's it's kind of complicated but they're really not not in the picture um as far as or in a in a place to take care of them in any way okay so your wife is the closest you know child they have that's actually still communicating with them what what is your wife want to do um I don't know it's it's tough I mean we're probably about four hours away from them so it's not like we can get over there once

1:51:19a week to go help them out with stuff but um you know I think if if my in-laws would be open to it I'm sure my wife would want them to move closer to us or in with us I don't know if that would be something acceptable for my in-laws that pretty stubborn but do they have a mortgage? um uh they do not what's their house worth uh I mean they're in the middle of nowhere it's probably if they could get a hundred grand for it that'd be that would be uh that would be a lot of so I I think the I mean you got two big challenges in front of you one will they even accept your help yeah right and maybe they won't now maybe they'll be forced to in five years like who knows but I think that's a that is a thing that's really hard to metabolize when we want to help people that we love and they are either too prideful or too scared or their ego is too big or any number of

1:52:19reasons but they won't accept our support and love as we as we can give it right and so that's number one number two is you and your wife have to just be flat out honest about what we can and can't do like and and like because what happens a lot of times especially in big emotional situations like this um is we just spend all of our energy on what we can't do or what we should do versus what we and y'all need to have a honest come to Jesus conversation about here's what we we could do even if they would allow it could we have could we come up with a thousand bucks to subsidize a one bedroom apartment in our neighborhood that's all we can do that's all we have and we're not going to give the money to you we're going to give it directly to the um place can we support groceries like you you know what I'm saying yeah I do and that's that's kind of you know part of the reason that it's it's difficult for us is that uh you know I do I do very well in my job and I've got a pretty significant amount of savings and so you know if we were to

1:53:24add an addition on to our house or something we could do that but you know I struggle with well okay I mean I've got again I've got a bunch of small kids like I want to think about their future sure I want to plan to be able to not put my kids in the situation that they're putting us in that's exactly right that should be your priority and and so you know but but at the same time like okay yeah we could I could write a check tomorrow and we could put it you know uh an in-laws we'd addition on our house and so that's just where you know I'm struggling with the right thing to do and if and if we I don't think if we told them hey we want this is our plan we want you to come live with us they probably would not accept it but knowing what's probably going to happen in the future is that they're not going to be able to work at some point in the future right if we had a place for them then I think it would just be a natural choice for them to come home with it. I can't throw a wheel. Yeah I can do it. Well that's where y'all say they wouldn't have any other option. Well so that's where I mean you kind of giving us a very clear path for you and your wife which is

1:54:28y'all let them know when and if y'all need support um we're ready to sit down and have that conversation and that that conversation ends right there because no probably respond with well we're fine you don't need to worry about it great cool and then you and your wife have to live in the reality that probably at some point you will be responsible for some sort of care. Yeah and and so we'll start putting a little money aside over here we might start looking at a different house down the down the road we might look at one bedroom apartments in the neighborhood um and by the way a picture for your kids it's easy for me to wrap my head around the only legacy I can leave to my kids is money there also is a huge legacy towards I watched my parents care and love well their aging parents right like that's also part of legacy it's also part of care and so all that is a tricky balance right and none of that comes in any sort of thing that y'all wanted or

1:55:31asked for right for sure how much are they letting you into their own finances oh very little I mean when they ironically Dr. Long I called a couple years ago when everything kind of hit the fan when they lost everything and you and Dave gave me some some great advice but um and so you know we're back now because you know if they had if they were to tell me they had $10,000 in their bank account I think that would probably be a surprise to me sure you know they're still gambling they're I don't think it's gambling anymore um but I mean they're working between the two of them they're each working at least 40 hours a week if not more and they're almost 75 each are they taking so security uh oh they're not my father-in-law held a cash paying job his entire life so probably did not report most of his income so um they're they're if they're taking social security it's minimal okay so y'all you and your wife have to have the conversation of what does taking care of

1:56:36mean yeah is that gonna be $3,000 in a nursing home is that gonna be like what are we are we gonna help them sell everything so they can get on Medicaid like what is that gonna look like for us and you'll have you as as her writer die you as her husband are gonna say like you're gonna have to work to not have that calculator running in your head of well if we had taken that money and invested it we could have given this to our kids right because if y'all agree on a number like do your best to say I was a part of this decision I'm a I'm a guy who's not gonna let two elderly people just like get stuck in the system especially if I'm being successful like I'm gonna grieve that and then I'm gonna go on and take care folks in the amount and to the degree that me and my wife agreed and then I'm gonna go on about my life and go from there and it could be I'm not I'm probably pying the sky here it could be that could it could it be that they would be fun to have around your kids or is that a no go you know I think they I think they would be but I just you know

1:57:44outside of something drags to happening I can't say at least my father law wanted to leave you know it's a town he grew all he was born sure when that power but he made choices he may not have a choice to stay right a lot of poor choices yeah but he may not he may not ultimately because of his past choices he may not get a say in whether he stays or not yeah that's true which which stinks hey let me tell you this brother your anger's right you're right to be mad at him for how he handled his finances for how he did whatever it is he did that anger won't serve you loving your wife well and y'all coming up with a plan together moving forward for here's a reality that we have in front of us none of us wanted this none of us planned this but this is what it is and we are people who take care of our family so here's what that's gonna mean for us here's what we can or cannot do

1:58:50you spend hours researching before making a major purchase like a home or car but it's also a good idea to put in the work searching for the right insurance coverage to protect your biggest assets I recommend using Ramsey trusted pros whether you're looking for car home or any other type of insurance Ramsey trusted providers have been coached and vetted to serve you like we would find what you need at ramsey solutions dot com slash insurance

1:59:50welcome back to the ramsey show our scripture of the day collotions four five be wise in the way you act toward outsiders make the most of every opportunity my angelo said I've learned that even when I have pains I don't have to be one yeah George I'm still learning listen to the great Maya I gotta take that advice all right Sean is in to moin up next what's going on Sean yeah I'm just taking my call just trying to get down to the bottom of how my wife and I can stop living paycheck to paycheck I'm glad you're here that's a big milestone just a want to do that it's tough I mean we get bills paid but I mean at the end of the week it's well we're sacrificing you know something that we not necessarily need but you know there's there's not a lot left at the end of the week how old are you guys I'm 32 and she's 30 how long you've been married not even a year will be a year in November congrats okay so what got you to this point um back story I married my

2:01:00wife she has three kids and we are soon to have one of our own um and when I was a kid going through high school my parents had told me that my grandparents had kind of set up a fund that grew and grew and grew um to give all the grandkids a certain a lot of money for college and that always kind of stuck with me that you know I'd like to do it to my kids someday you know um in the last year or two we've been getting their stuff paid but it's you know I want to be able to do something like that for my kids someday so your stated goal is I want to create generational wealth and therefore I need to have some eventually and dad has hold me back from that so how much debt do you guys have collectively um some is mine that was pre-existing I bought a parcel of land before we got married so now it's early and as well now so that's kind of hanging over our head we have a hundred and

2:02:02sixty five thousand on our house um seventy six thousand in car notes and roughly four thousand in credit card could you sell that parcel of land today um that would be there's a comes a buyback clause I bought it for my father so in seven years better would go back to my father but would he give you the money back for it um I think you was happy to sell it to me I think you was happy to see the whole world to farm um and that was kind of his way of starting that you know again in a very discounted rate um if you sold it back to him how much of a check would he write you 800 thousand I mean there's your generational wealth right there brother yeah it's a family piece

2:03:05that I've been wanting for years um and that that was kind of the push um I traveled for work for many years I did that for nine years um and to be with my now stepkids and a kid to be on the way I left that and joined another job um which paid significantly less but more time with family so what do you guys make now as a household one thirty okay well uh there's some clear writing on the wall here the cars have to go this is crazy to have 80 grand in cars making one thirty do you agree yeah what are they worth it um probably 25,000 on mine um I would say probably 40 to 45 on hers okay so you're probably six grand underwater yeah so you scraped together six grand over the next month or two you can get rid of both of these cars and buy some cheap ones maybe save up for a few more months yeah I mean what are the payments on these things um the payment on mine

2:04:13so and that's that kind of leads me to the next thing um the land that I bought um at a very discontent rate um fell into a pretty good hole and had to use a line of credit against that still well below what it's worth um but that note is hanging over ahead as well okay okay but listen you you've talked yourself into a corner brother and I'm saying this man as a guy who obsessively I check land prices every day of my life okay and I'm not even a generational guy okay so trust me like I love the impulse in the idea but if if Dave came here and brought me one of his cars that he's collected and said I'm gonna give you this for 25% of its value that's an incredible deal but if I don't have that money it's not a good deal for me unless I'm planning on buying it and flipping it yeah you know like here's what you have you have

2:05:16two competing legacy dreams one I want my kids to have peace in their spirits when they leave our home that they'll have some money in an account that they can go take on the world and you have another legacy which is I'm going to come hell or high water put my family into financial ruin for this vision but I will keep this this land I will farm it regardless of what's going on in the world because that's who we are and you have to pick which vision you and your wife want to live into she's very she's very stuck on her ways um as far as um having really nice things um I didn't I grew up very fortunate um not wealthy by any means um very weird farmers you know we have make do with what we have sure um so that's been kind of a change and I'm being humbled by it as well maybe putting things off to not favor them or not you know spend the money that we don't have

2:06:18sure um well asha there's there's two pasts ago it sounds like you're not going to sell either the vehicles you're not willing to sell the land so the only other option is you guys work your tails off 80 hours a week for the next six years to try to get this thing paid off that's it or we can shortcut that by getting rid of these things that are going down in value these vehicles that are crushing us who are we trying to look good for because so far you said you want to build generation of wealth you're creating generational debt so far at every turn you are taking on more and more debt to try to fund this lifestyle to look like you've made it or sitting down through dad and saying dad I want more than anything in the world to keep this farm but I can't afford it I simply cannot like in this new world that I chose which is three young kids a fourth on the way a new life with a new a new partner I walked into this eyes wide open and this I can't make this work anymore I can't keep living two lives one as a farmer as a generational farmer landowner having to take out lines of credit to keep farm running and also be a responsible adult with these

2:07:23four kids I've got living this other life with my spouse that's a tough pickle to find yourself in man but the longer you avoid dealing with reality the old saying is conflict deferred is conflict amplified this problem doesn't go away it just gets bigger and bigger and bigger and bigger as the sooner you and your wife can align on who we want to be and what is that vision going to cost us and how quickly can we get through that that's the path to freedom man and none of this is easy all hurts man all it hurts I can't imagine George going to my dad and saying you gave me this incredible gift and I can't afford it that would that would break my spirit I think and it probably break his spirit and it's the right thing to do for my new responsibilities my three kids plus the one on the way plus my wife that would be the right thing to do or sitting down my wife and saying we we make a good salary and we have this almost a million dollar piece of land we cannot afford these two cars we're going to sell them and we're going to drive bitter cars because money in the account money in our future is more important than comfort today right I mean I don't know

2:08:28another path forward it sounds like you you want to want to get out of the cycle of living paycheck to paycheck because if you want to you've got a path right in front of you man it's not going to be a pleasant one but you got a path it's just going to take a complete reorientation of how you'll do life together right the hardest part for me is knowing like you said you said don't have a talk with my dad but the hardest part for me is you know it's a sign that's getting out of money to anybody my fear is that by selling that back to him that is going to put him in financial ruins and that that's that's something that's just been over my head for I mean you can't carry his burdens also this is hot potato right my hope is that he kept that he hundred thousand dollars that you gave him man hard choices in front of you Sean make the right ones that puts the sour of the Ramsey show in the books remember there's ultimately only one way to financial

2:09:29and that's to walk daily with the Prince of Peace Christ Jesus