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Normal is broke and common sense is weird, so we're here to help you transform your life.
From the Ramsey Network in the Fairwinds Credit Union studio, this is the Ramsey Show.
I'm George Campbell joined by Ramsey Personality, Jade Warshawn.
We're taking your calls at AAA8255225.
Arlee is going to kick us off in New York City.
What's going on, Arlee?
Hello.
Did I get that right?
Is it Arlee?
Yes, it is.
It's Arlee.
What's happening?
So, when I was around like 20 to 21 years old, I had a pretty good credit score of like
800, and then my mom kind of guilt trip me into being a co-signer for one of her cars.
And then the following year, there was a second car that I was unknowingly signed into when
we refinanced the first car.
And I think about two years after that, both cars have been repossessed.
And the first car was, there's a judgment on that car and it's under my name.
Oh, boy.
And I guess, and there's also a personal loan that my mom kind of made me take out around
the same time.
What do you mean, made you?
Yeah, what's that sound like?
Are you against your will?
No.
Well, she guilt trip me into doing all of that.
Yeah, but you're a grown person at 21 years old.
Yes, of course.
Like, I understand that, but I guess like culturally speaking, it was always, you can't.
Like, I've done so much for you.
I need you to do this for me and you just went, okay, fine.
Exactly.
Exactly.
And it was like non-stop.
So essentially, after all of this, we're like 20 K and that just on my mom alone.
And I guess I'm trying to like figure out how to move on from one, getting these two
cars off of my name and like, you know, paying, I guess, paying it out because I just recently
got married and me and my husband haven't been able to join our account because of this
major issue.
Absolutely.
Absolutely.
And like, how old are you now?
I'm 26.
Okay.
Oh, okay.
So this has been a, a while back.
Yeah.
Okay.
But I think the repo just happened like about two years and what are they coming after
you for for that for for both repost, tell us the amount for both.
So the first car, well, the major car was 10,000.
Okay.
Is it that you owe?
Yes.
Okay.
What about the second one?
The second one is 8,000.
Okay.
So the good news is you're going to settle both of these.
You're not going to pay the full amount because it's been forever.
They'll be happy to get anything from you at this point.
Okay.
So that's what I'm talking about with your mom anymore?
We do, but unfortunately, I don't really trust anything she says.
Rightfully so.
So for the sole reason that January of last year of 2025, she actually like moved to another
state and we came to find out that she kind of owed a lot of people a lot of money.
And it came to run like a total like 50 close to 100 and just like personal loans like
under the table.
And this year, I kind of talked to her or last land of last year, I talked to her to
settle the personal loans.
Let's talk about, let's talk about you go imagine that she's not going to help you solve
any of this.
And your name's on the debt.
And so they don't care about where she is and if she's going to refine to her name,
you just need to act like this is dead.
I took on and I got to clean the mess up and it's a learning experience.
So I'd be looking to settle these for, you know, 50, 40 to 50% of the actual amount
owed.
That's what I'd start with.
And so that would be your goal to save up that cash because anytime you're going to
settle a debt, you've got to have the cash in hand, lump sum, yep, and you want to
get it all, all those stipulations in writing and you really want to laminate it and keep
it forever because you never want these things to come back and bite you in the butt.
How much is the personal loan?
Is that another two or three thousand?
Yeah, 2000.
Okay.
So 2000 on the personal loan, how much do you and your husband earn every month?
And we, every month would be about six, 7,000, okay.
And is he on board in the idea that we're going to clean up this mess or do you feel like
it's kind of on you to do it on your own?
I think personally, I don't want him to take on the burden.
Can I tell you this personally, I don't think you're going to be able to clean this mess
up on your own.
No, I know, but I think he does listen to the Ramsey show.
So I do know that he will be willing to settle this with me.
If the tables were turned, would you be willing to help him?
Of course.
Okay.
There you go.
So as long as you know that you're not asking more of someone than you would want asked
of yourself, then I think it's okay that you participate, that you receive that if
he's willing to do this with you, which I think he should, by the way.
The hardest part is going to be swallowing your pride and going, you know what?
I know I feel guilty in shame about this, but I'm going to bring him in because this
is marriage.
Yeah.
No, it actually helped me because when we first got married, we settled, I think, about
2000 of credit card loans that my mom also racked up, so, you know, okay, is any of this
been done fraudulently?
Um, she's not able to just like forge your signature.
It sounds like you were there.
You at least signed some documents on most of these loans.
So the, like I said, the first car was her car that she was driving and I was helping
her.
You co-signed.
So that one's legit.
I did the second car.
I did it co-signed.
She did.
I did co-signed.
I did co-signed.
Oh.
But what happened was when I went to the dealer, they told me it was a refinance.
When it came out, like I think six months down the line where we were getting like these
late payments, they were telling me, oh, it's the car that I took out from my cousin
and you are co-signed and I was like, I was never informed of this.
But by then, they told me it was too late to back out of it.
Okay.
Do you guys have any other debt outside of this 20K?
No.
A student loan debt.
How much?
How much?
I have about 16K and my husband has about nine K.
Okay.
Promise me.
Make me a promise that you have learned your lesson, not just in co-signing, but really
in borrowing money in general.
Look how much heartache and pain this is because this is literally, and don't get me wrong.
If I were to assign blame, which I'm not usually in the habit of doing, but most of this is
on your mother, okay?
Because she was, there is an imbalance of power there when you're 18, 21 years old and
a parent is saying, you need to do this, you need to do that.
You do feel the overwhelming need that either they're right or that you should be listening
to them, even if you shouldn't be.
So I hate that that happened, but this is such a learning opportunity for you.
No more debt, no more co-signing.
You pay this off.
Never again is really the line of the sand that you need to draw.
Have you frozen your credit with all three bureaus, Arley?
No, I haven't.
You need to do that yesterday.
And while you're at it, pull all three credit reports from the bureaus.
You can go to annualcrederreport.com, do it for free, never pay for this.
You need a full picture.
Because who knows what else is out there.
Before we can move forward and do this debt snowball and settle these debts, let's get
a real full picture of what's going on and freeze your credit.
So nobody, you or your mom can be opening up debt in your name ever again.
That's right.
Wishing you the best.
This is not a fun situation, but I'm very confident you guys can clean this up.
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Barbara is in New York City up next.
Barbara, welcome to the Ramsey Show.
Hi, thank you for taking my call.
Absolutely.
How can Jayden and I help today?
So my question is how can I convince my husband to combine our finances?
How long have you been married?
We're coming up on 12 years.
That's a long time to now start this conversation.
How long have you been trying to do this?
So several years now, so when we got married, I made significantly less and he actually
purchased the house a few months before he proposed.
So and I really feel like it's his house.
So that's the other part of the conversation trying to convince him to put my name on
a date and all the end of the mortgage.
So I feel like when I bring it up, I'd be so often and say, hey, you know, maybe we should
be doing this.
I mean, it worked hard to better myself.
So when we got married, I've made about 35,000 which isn't very much.
Why does it matter if you made a dollar or a hundred thousand dollars?
I'm shook by that.
I feel like this is like you're trying to prove that you're worthy of being next to his
name by you getting yourself together because he said a benchmark like, hey, once you hit
50 grand, then we'll talk.
I kind of feel like we have to be able in terms of how we, how much we earned because
right now, I don't know, if that's the pudding, we get it off on, he divided up the bills
based on the percentage of what we make, so based on how much I made, I covered the bills
according to that.
Okay.
And so on, you know, slowly, I've increased what I contribute, you know, how he repairs
and all that stuff.
Right.
Right.
So this is really, really, really unhealthy.
I'm sorry, but it is and I think you're right.
You guys got off, you got off on the wrong foot and it just set the tone for the next
12 years and it started to, you started to believe that, that you, yeah, you are your
percentage and you're worth whatever percentage you're contributing and vice versa.
And that is going to take a lot of time to tear down.
Honestly, it sounds like kind of in both of you, because I think you're starting to see,
yeah, I need to, we probably should do this, but it's also like you're fighting that
old mentality.
So when you bring it to him and you say, this is, I feel like this is destroying our
marriage and here's how, and it's making me feel less than, and I'm just scared that
this is going to drive us further and further apart.
What's his response?
I guess defensive, so, and are you saying it's on him or are you saying we both did this
thing?
I, you know, thinking back, I'm probably putting a little too much on him like you, because
it feels like everything belongs to him, the house belongs to him, but you also participated
in that.
So I think, approaching it, you know, approaching it in the way of, we set out, and this
is honestly probably exactly along the lines of what I would say if I were in your shoes.
12 years ago, we got married, we decided that this is how we were going to do finances
and I agreed to that.
It made sense to me, and I've participated in that for 12 years, and in the past couple
of years, I've really started seeing that it's not, it feels like it's driving us apart,
and you may not be aware of it on your end, but it's something I'm sensing, and I just
feel like it's, if we don't address it, it's going to get worse and worse.
And I would love for us to talk about ways that we can change the way we're viewing
money to where there's complete transparency, we're both equal, and we're both, you know,
a part of it, and maybe that will open him up to go, okay, she's, she's trying to, she's
trying to come towards me, she's not trying to say this at me and tell me that it's my
fault.
Right.
Yeah.
I think, yeah, probably without meaning to make it, it sounds like it's all on him.
Yeah.
Yeah.
That can go a long way.
Listen, even if it was on all on him, I think there's just, there's things that he is
not telling you, and I don't know if this is coming out of, you know, baggage he had
growing up with money, why he wants control, why he wants to protect himself, did he have
a previous marriage?
What do you think is behind this?
No.
Well, I honestly don't know entirely, I know his parents went to a bad marriage, and I
don't know if that's part of it, but it does feel like he's very guarded with his money
and he wants to protect it.
And he's, you know, he's got businesses and he buys cars, whatever, and how often he
wants.
And I don't have a saying it because it has money and he, you know, you have a roommate
that you signed a contract with essentially, and I'm sorry, that's not fun.
It's not healthy.
And I don't know if I'm not here to define someone as a narcissist, but it's giving
narcissists, it's giving emotional abuse and he's making you feel less than you own
nothing and you should be lucky you get to live in my house.
That's not good.
Right, kids?
No, we don't, we, I became nervous early on and just did not do and he went right along
with it.
So we agreed together that, but I guess we didn't agree, it was more like I was apprehensive
and he was like, whatever you want.
Okay.
Okay.
So no children to speak of.
So this is my guess is he would, he would never agree to go to counseling with you.
Would he?
No.
No, I've asked.
Can you go on your own or would you have to ask him for permission for allowance money
to go?
No.
I've been going, I go on my own and good.
I haven't brought the situation up though.
Why not?
I talk about everything else.
This would be the number one situation I would bring up.
Right.
This is the main thing in your life right now, and you're calling us for advice on this.
I don't know how to convince your husband because I don't know that he can be convinced
at this point because he has convinced himself that he is the king of the house and you
should be lucky to live in his castle.
And honestly, there seems like there's no bit, there, there hasn't been any consequence
for his action, for lack of a better word.
It's kind of like he gets to do whatever he wants and there's no, nothing comes back
on him as a reason to change.
No, I guess I felt like it was just a money issue.
No, it's not.
It's a respect issue.
It's a respect issue.
It's a respect issue.
He's not seeing you as a person, a full person who's contributing, invaluable, and all
the things that he should see you as.
Think about it.
This marriage, any relationship is built on two things, trust and respect.
And you don't have either of those from him, and I don't know that you ever did.
I don't know how this marriage started and how we got here, but you need a reset conversation
with him and use eye statements and make it about you and say, listen, I want better
for us.
I want unity in this marriage.
I didn't sign up to be a roommate here.
I want transparency, not because I don't trust you, but because I think I deserve a vote.
And for too long, I felt like I didn't.
What would he say to that?
Would he get defensive and shut down?
Yes.
I think that's very telling.
Barbara, what your next step should be?
How are you doing?
Let's talk about it the way you guys talk about it, which is your finances are separate.
How are you doing financially?
I'm doing much better.
I've worked hard to increase my own income.
And I have money set aside, and I listen to you guys, and I set up my savings in six months
and all that, and I invest in my 401K and all that.
But just talking about that, like just thinking about it, and just listening to you guys,
I do kind of just feel like a house sitter, you know?
Right, fully so.
I mean, for all intents and purposes, that's kind of the placement you guys have put you
in.
And it's totally fine that you are saying, this is not okay.
And I'm not going to do this anymore.
And if I were in your shoes, you know, I'm no counselor, that's for sure.
But if I were in your shoes, I'd be making some pretty strong statements about what I
am, and not going to do, and what I am, and not going to put up with, you know what I'm
saying?
I'm not sure you've seen Barbara's backbone, and I think he's about to see it.
For someone who's been offered counseling, for someone who's been offered the opportunity
to sit down and talk, for compromise, and they've turned away all of that, now I'm going
to tell you what I'm about to do, and what my terms are.
And that's what I would do.
I feel like, okay, enough is enough.
And here, you're about to see the smoke.
And Barbara, a great exercise for you is think about if this was your friend, and she
called you and said, hey, this is my situation.
What would you honestly tell that friend?
Maybe write down a journal tonight, as if you were writing a letter to that friend, and
then read it back to yourself and go, oh, this is for me.
These are the steps I need to go take, because I deserve that.
You deserve to live a life.
You don't deserve to be in a prison with this guy.
And so I don't know that we can change him, but I do know that you can make some changes
for yourself, and that might be the healthiest move for what's next.
I'm so sorry you're going through this.
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And guess what, Jade?
What's up?
Guess what I'm doing on Valentine's Day?
I don't want to know, George.
Getting my taxes done with my tax pro.
It's not what I expected.
We're going on a date after.
I'm mad at you for this.
All the restaurants are booked up, but my tax guy was free.
I said, all right.
Let's make it a date.
I need to text Whitney.
I know.
So she deserves better.
Don't worry.
We're going to get some chips and margaritas after.
All right.
There you go.
All right.
Lisa is in Hartford, Connecticut, up next.
What's going on, Lisa?
Hi.
How can we help today?
I am 58 years old.
I have $60,000 worth of state tax debt.
I have $60,000 worth of credit card debt.
I'm a single mom through college aged kids.
And I am trying to figure out if I should file for bankruptcy.
I have another $10,000 that I owe.
The IRS I came to a settlement with them.
So I guess it's about $70,000 worth of tax debt.
How did that happen?
Well, I am a single mom.
And when I got divorced, I didn't make smart decisions with my almony.
I tried to keep my kids like in the same, you know, like I didn't make any changes.
I wanted them to feel like the divorce.
OK.
So I lived way beyond my means.
I also went into recovery.
So I was, you know, kind of white knuckling, raising them.
And I did a lot of spending out of like parental guilt trying to like make up for time that
I'd lost.
OK.
OK.
OK.
OK.
Understood.
So what's the case now?
What are you doing for work?
What are you earning?
I have a great job.
I make about $105,000 as administrative assistant.
I have a site.
Like I also work for the same family at a farm in the weekends.
So I have a little potential to make extra income, but I'm drowning because I can't, you
know, like my, you know, I just just got the dollar's app to figure out what's going
wrong when I'm spending more than I can afford, you know, in rent and even the basic things.
How much is your rent?
It's $3,500.
Oh, girlfriend.
And you're bringing home like six or seven?
What's the take home pay?
My take home is $66,600 and then another $1,000 approximately when I do my other job.
OK.
OK.
OK.
So, yeah, this is the problem.
The rent is, have you looked into things that, I mean, you're in Hartford.
That's an expensive area.
Have you looked into other options?
I mean, what are you living in right now?
What is the nature of your house?
Is it too bedroom?
What is it?
Yeah.
I'm in a too bedroom apartment.
I like the town.
I raised my kids and I moved into a less expensive area, but it's still very expensive.
I'm currently looking like I was trying to keep, you know, one of my kids has graduated,
but one of my kids still comes home and I still have that need to like have a bedroom
room.
You can.
Hold on.
Yeah.
You got to stop that.
It's an air mattress in the living room.
Yeah, you got to stop this mess because that feeling of having to make everything all right
for them is what got you in $130,000 of debt.
So you got to stop today.
They're grown.
They love you.
You don't have to prove it.
It's inherent.
Because here's the truth.
You being a burden because they have to cover mom's expenses for the rest of her life
because she's broke is so much worse.
Come on, George.
And then sleeping on an air mattress because mom can't afford $3,500 in rent, which is
totally reasonable.
Yeah.
What's your commute right now?
And how far can we get you out of town to get this?
Yeah.
Right.
Right now is great.
Like I'm 10 minutes from my job, but this is the problem.
Yeah.
I can't get you out into the country where rent is $1,000 a month for a one bedroom.
Yeah.
Okay.
Right.
And I'm laughing, but I'm being serious.
You know, rent is going to keep you from freedom here.
So your first order of business while everybody else is going out for Valentine's Day, you're
going to be on the computer searching for a new place.
When's your lease up?
Yeah.
It's up in June.
Okay.
Perfect.
Yeah.
Yeah.
Perfect.
So find the spot.
It gives you time to tell your kids, hey, we're moving.
And that's wonderful.
Think about it.
You went down to 1,500 instead of 1,500.
That's two grand a month.
You could be throwing at your debt.
Yeah.
That's, that's, I've been looking for an apartment.
I have been looking.
I've downsized my look to one bedroom apartment and there's, I think you're right.
I think I've to expand my commute distance because I'm still hitting them with prices.
You have to.
It's a must.
Bankruptcy, I'll take a 20 minute commute, a 25 minute commute because that bankruptcy
will destroy your financial life at least for the next seven years, which puts you into
your mid 60s by the time you can even recover.
Now what about your car?
Do you have a car payment?
I have, I have, I own my car.
I'm making my son's car payment.
No, no.
Lisa.
I know.
What is your name?
It's not graduated.
I know.
He just graduated from college.
Is your name on it?
Yes.
Why?
Why?
Why?
Okay.
Well, this is fun.
Then you get to say, hey, son, I got to sell this car.
Yes.
Hope you enjoyed driving it.
Yes.
Tell him it was basically a rental.
Hope you enjoyed driving the rental.
Yes.
But, George has never been more right.
But you have to do it.
Right.
How much is the car worth?
I, it's 17,000 maybe.
And how much do you own it?
It's at least so.
The car, the car that he has is, oh, no.
That's even worse because you can't get out of this thing unless you have the lump sum
to do a full buyout.
Right.
When's the lease up?
He could take the payments over.
He could.
When's it up?
I have to look.
I'm not sure.
I think it's another year.
Is he working?
He just started a job.
He just started an internship.
So, yes.
Okay.
So, I would have that conversation.
I'd say, son, I made a mistake.
And I'm really sorry, I, because it's going to affect both of us.
I agreed to pay this lease.
I can't afford it.
I'm over here struggling.
This lease is good for one more year.
We either need to, you either need to take this on completely.
If you can't afford it, I'll pay whatever little bitty portion that you can't afford to
pay.
But this is going to, and put it in George's words, if I don't fix myself now, I will
end up being a burden to you later on in a greater way and I don't want that.
And hopefully he can understand that.
But yeah, the tables, the way we've been doing life with money and kids has to change
today.
And I'm glad that you called in because I think that you're starting to understand that.
But I can't stress that these are not going to be, they're easy to understand, not easy
to do.
Right.
You know?
Yeah.
So, here's the math on this.
If you say, you said you make about 7,500 a month, if you keep the side job, right?
Mm-hmm.
Yeah.
Are you doing any investing right now?
Yeah.
Well, a little bit to my phone, but I stopped that.
Good.
Let's pause all investing to clean this mess up so that we can actually retire one
day.
That's the goal.
Right.
And right now investing is not helping us get rid of the mess.
So, let's say you could, you know, you make 7,500 and you lived on 4,000.
That's fair.
Right.
If you move this, if you switch your renting situation, that frees up 3,500 bucks a month
to throw a debt, right?
With 130 grand in debt, you're done in about 37 months, three years.
Right.
And that's if you do no other changes.
If you can just cut your rent down and throw that amount of the debt we're done in three
years, I think you can do even better with this.
You're very talented.
You have a lot of high skilled, you know, you have a lot of high skills.
I would use that to your advantage, live on as little as you can for two years.
Let's say you're 60th birthday.
Let's celebrate you becoming debt free.
How cool would that be?
That would be amazing, really amazing.
It's possible.
I mean, you can crunch the numbers and go, all right, this is the margin I need.
I need $4,000 a month, come hell or high water to be throwing at this debt and then do
the debt snowball.
Knock out the smallest balance first for you.
The IRS debt goes to the top because they can really screw up your life in garnish
your wages.
I would attack that first, but once you're done with that, just debt snowball it, whatever
the smallest card balances, attack that first, minimum payments on the rest.
Okay.
You can do this.
Keep me in my minimum payments.
Yes.
Don't get behind on anything if you can help it.
Yeah.
I'm already a little bit behind on a lot of the payments.
Is anything in collections?
Credit card numbers?
No, not one credit card is actually, yes.
Okay.
So go ahead and settle that one.
Just try to get current on everything and then attack the IRS debt, then debt snowball
the rest.
That's your goal.
We're going to cover four walls, basic food, utilities, housing, transportation, insurance,
and then beyond that, we are living like broke college kids because right now your kids
are living more lavishly than you are.
That's pretty wild.
Like I think college kids should be broke.
That's the stage of life.
Not a 58 year old woman who's trying to provide for them.
So you've done more than enough.
You don't need to earn your kids love by going deeper and deeper into debt.
Right.
Okay.
You got this Lisa.
We're cheering you on.
I'm going to give you every dollar premium version to connect your bank accounts.
Have all the transactions come through because you make great money.
It's time to put every dollar to work cleaning up this mess.
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Well, really a couple of things.
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Alrighty, today's question comes from Kyle in Florida.
He says, I'm going to be a new dad soon and want to do everything I can to set my son
up for success.
We plan on opening a Trump account for him and contribute $5,000 a year.
How can we avoid a mindset of entitlement in our son if this account has hundreds of
thousands of dollars in it when he turns 18?
I'd like to reinforce the idea that we did not set up this account to squander the money
away on ridiculous material purchases every 18-year-old dreams about.
What's the best way to set up boundaries on how this money can be used?
That's a great question.
It's a really great question and there's kind of two sides of it, George.
The first side I'm seeing is just raising a child in the way that he should go, right?
What you're teaching him about money in the next 18 years is really huge and then there's
the side of, is this really the best option for you?
Do you want to have control over that money or do you want him to receive this money at
18?
There's the strategy side of how is it smart for him to receive that money at 18?
Let's talk about both.
I'll start with the raising side.
I think whatever you show your kids, the most is what they're going to pick up on and
they're going to learn.
If you've created a lifestyle where we don't squander things in our home and we're very
thoughtful about our purchases and we don't buy things to impress other people, your
child is going to pick up on that.
A lot of that is due diligence on your part.
When it comes to the Trump accounts, if you want to participate, I suppose you can.
It's not what I do.
I do 529s for my kids and we also have a brokerage account that we know we're going to give
money to them out of when we're ready to help with things like down payments and things
like that.
That's how we do it.
What do you do, George?
I actually looked into this and I realized there's not a whole lot of advantages outside
of the $3,000 if your child is born in 25 through 28.
I had a kid in 2025.
I will happily take $1,000 from the government because I've given much more to them.
I'll take that $3,000 from my little guy and it'll grow.
I will not be contributing more than that because to your point, at 18, they get control
if it's a Trump account.
They don't need hundreds of thousands of dollars at age 18.
You hope they're going to go, I'm going to use this for a down payment or you don't,
but you don't know.
We don't know exactly how they're going to guard against you using it for other things.
They haven't been super clear about what you can use it for outside of education and
a down payment.
That's actually a major difference that I want to talk about.
If you look at things like Roth IRAs or custodial accounts or they're established.
What it is is what it is with these Trump accounts because it's tied to, it has the ability
to change over time.
It's not locked in in what it can change into and I think that's something worth noting,
but yeah, I'm the type of parent.
I want control.
I don't want you ending up with $100,000 or $500,000 at age 18.
I want to have the control.
For us at age 18, no 18-year-old, they're prefrontal court taxes in base yet.
Yes, I was.
What is?
These are the same kids taking out $250,000 for degrees that they don't need.
That's right.
Let's not give them that control.
So I do exactly what Jade says.
I got a $5.29 plan for education.
I'm funding that and then for other needs outside of education, I go with the taxable
brokerage account in my name that I can give that money when I believe they are ready
to handle it.
So if I want to cover the wedding, great, I can take that money out and I can pay for
the wedding.
If it's their first car, I have control over that of what car I choose to buy for them.
Yeah, that's right.
And same thing with the down payment.
If you want to give them a house, I want to be able to control that.
And so I think that's very wise to do and I'm not mad at the Trump accounts.
I just don't think it's all it's cracked up to be, but I love that it's starting the
conversation about investing for your kids at an earlier age.
It is.
And you have up to $18,000 per parent per child per year that you can give without
really any without having to fill out the gift tax form.
And so that's that's a great way to go as well.
And the exemption is now if you're married couple, it's like 30 million dollars.
Yeah, it's high for your gift, your state exemption.
So not something most people have to worry about hitting.
So great question, Kyle, if you want to do this, I would contribute to the taxable brokerage
account.
And if your child can get the three thousand bucks, I would absolutely take that and let
it ride.
Because even a thousand bucks from zero to 60, don't even tell them what exist.
I mean, they'll know it exists when they turn 18 and they're like, sweet free money.
Yeah.
Maybe that's for the first car.
That's right.
Perfect.
All right.
Let's go to Quentin in Lincoln, Nebraska.
What's going on?
Hey, guys, I appreciate y'all taking my call.
Sure.
Um, so just to keep us short, I have just found out that my girlfriend, um, who I've been
planning to propose to, is pregnant and we're expecting twins.
Woo.
So, yeah, you know, have a blessing.
Absolutely.
I, uh, but in concern about, I'm on, I'm on baby step two, uh, doing the death snowball.
Um, I'm, I'm financially concerned that, um, you know, with these two coming, uh, uh,
we're going to be in a bad spot.
If I continue to put everything into the death snowball, um, I'm wondering if maybe I should
put a little bit more into savings instead and what your guys are on that.
I mean, yes, I would probably pause all getting out of debt behavior because this is a storm
and a storm.
This is stormboat and sportboat.
Uh, what, what's the plan going forward?
Was this somebody that you were thinking could be the one or did this, was this really
just like, uh, oh, yeah, this was a very big surprise.
Um, it's, it's funny because for months, I've been planning, we're taking a trip
to Florida next week and I have a ring, um, so we're going to do, yeah, so I, you know,
I wanted to do marriage and everything before kids and, uh, come to find out.
So, well, the good news is this was someone that you were thinking about that you knew
you wanted to spend your life with.
It wasn't just like I was dating this girl and, uh, oh, and we knew she won one.
Okay.
So this is, so you're still going to propose next week?
Yes, that's the plan.
Good.
All right.
Okay, so that it just kind of expedites things.
If I was in your shoes, let's propose, let's hope she says, yes, I assume she will.
And then let's get married.
Let's do a courthouse wedding and then we'll do a big party to celebrate later.
Cause right now we're broke with a baby on the way.
The party can wait.
But I think it is wise.
If you were already planning on getting married, let's go ahead and speed that process up
because we, we've been doing some, some things backwards now.
As you said, you didn't want it to happen in this order, but here we are, right?
So let's move forward with a pile of savings.
And when baby and mom, babies and mom are home safe, then we can hit play on the
debt snowball.
And hopefully you don't have to touch that pile of money and you'll have a bunch
to throw at those debts.
What do you both do for work?
Um, I, uh, I'm a union plumber and she is, she works in a daycare right now,
but she will be staying home when we have the kids.
And that was kind of a second part of the question is, you know, what's her being
dead and her staying home marriage was obviously going to be an option.
And as you guys are saying it, do it sooner than later.
But then I'll be taking on her debts as well.
And so that's where you know, it's going to take like a decade to pay this off
if it's all on you.
Well, I mean, kind of feels like, you know, I make these some money and I, what do
you make and what's the total debts?
Um, I'm at 110 last year on my W2s and, um, uh, total debt combined.
It's about 26, 27.
Oh, right.
Okay.
We can do that.
You can knock that out fast within a year, mm-hmm.
Maybe even less, you know, with just your income.
Right.
And that's where, and that was, so I just downloaded the, uh, every dollar and it
looked like, you know, I was going to get one of the big ones off right before
a due date, um, but then, you know, that's where I'm, I'm now on like, I don't know
if I should.
Right, but no, no, no, but you're, knowing that you're stacking up that money and
knowing that the day these babies come home and they're safe and they're,
they're healthy.
Knowing that you can take that money and then knock out that, that, that debt is
fabulous.
So it's just peace of mind sitting there waiting for you.
Are your expenses pretty like that now?
I, I, I mean, Morgan's, you know, we're looking at 1400 and after that, you
know, cars are paid off.
Right.
Um, what about insurance from, uh, health insurance is all union.
So that comes out before my take home.
Okay.
And do you know what the out of pocket maxes or like what the deductible is?
Cause you're going to need that possibly.
I want to say it's a, it's a 5,000 deductible.
But if we add her on, I'm not, I'm not a hundred percent.
I haven't looked into that.
I check into that.
I always like to advise people to have that number saved up going in because
again, you never know what could happen.
And it could be very easy and certain situations to hit that deductible and
have to shell out that money or even worse, you know, out of pocket max for
here, but if your expenses are pretty low, you can throw four grand a
month into savings, seven months from now, you have all the money to pay off
the debt and as soon as they're home and healthy, throw it at the debt and
wear debt free, man, best of luck.
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Welcome back to the Ramsey show and the fair winds credit union studio.
I'm George Campbell joined by Jade Warsaw and we're taking your calls at
triple eight eight to five five to two five.
Jason is with us in Indianapolis.
What's going on, Jason?
Hey, thanks for taking my call.
So the most basic level of this question is for about a 10 year period,
my wife and I need to live in separate cities.
I'll be snowboarding and coming back seasonally.
She'll come out to where I want to be as she's able.
So the most basic, how do we pull this off?
Why is it necessary?
Tell us about what you're trying to accomplish.
Sure.
We're from the Indianapolis area.
We spent about three years in Arizona during the COVID years.
And when we moved back to Indianapolis for some elder care and family
responsibilities, but COVID has had a serious impact on my health.
All the specialists I've been treating with, not very effective.
The what has worked for me is the climate back in Arizona.
My conditions continue to worsen.
And so I need to be out there for relief.
My wife has a once in a lifetime career with a large Indianapolis
employer and has a pension that we're really going to need come retirement.
And the family reasons still exist for her.
Okay.
So is how much is, how much do you guys earn?
Combined, we make about 160.
And she might have some potential for bonus, but we don't really think about that.
What makes her job a once in a lifetime opportunity?
Because when, when you said that, I'm thinking that you're going to hit me with the fact
that she's making crazy money.
Well, she's making crazy money for the way we grew up.
But she works for a big farmer here as a phenomenal job with her position was eliminated.
They allowed her to come back as though she had no lost time and resume her pension,
where she left off.
Okay.
Finding employers in this area with a pension, not great.
We're beyond the part about where I think she should go with me and we should have one home.
That's a focus on the family discussion that we continue to have.
I want to say, family, are we talking kids like parents, her father in law, I'm sorry,
my father in law, her father has dementia and we're here to help her brother and his
wife with elder care.
And then there are children having babies.
And so we've got grandchildren too.
And you know, it's a difficult situation because the, the, the crux of this is my
health and it's not improving and you know, there's something to be said for I'm not living
and contributing positively to the family dynamic until I get better.
Where would the majority of the time be spent?
Would you be, or let me ask this in a better way, would you be living in Arizona basically
indefinitely and you're just making trips to Indianapolis to visit her where she's living in
Indianapolis, then making trips to visit you like it's to you're spending the majority of time
in your separate cities or is it kind of like we go over here, then we go over there.
Right. So my employer, I work remotely and have the flexibility to be back in Indiana during the
lowest my green season, which would typically be the summer. So you'd only be their summer.
Oh, boy, typically, you know, she would come out to see me when she can.
I would come back here when I can. It doesn't preclude that I wouldn't
come out other times, but in terms of the biggest amount of time, it would be summer times.
And this would be for a 10 year period when she plans to fully retire and the way I'm wired,
I'll always have to work to keep my brain busy.
Let me tell you, let me tell you what I'm thinking right here and again, this is a decision you
guys are going to make, but the two things that pop up to me is 10 years is a very, very long time.
And a lot of times what I'm what I'm hearing here is several variables that are very important
in that you're trying to hang on to every single variable, but they're not all,
they're not all serving you in the in the in the right way. Okay, there's there's the aging kids.
I'm sorry, the aging parents, there's the green kids, there's the dream job, there's the health
issue, so there's all these things. I really truly think that you're going to have to force rank
the top two most important things and make the decisions around that. If everything is important,
your marriage goes down the drain. I just don't see how you can do this financially,
because I would never hang on to a job simply for a pension, number one, especially at the
detriment of you having to spend 10 years, like, you know, back and forth. Then there's a part of,
there's the elder care, but you said the, it sounded like you said the sister-in-law and her husband
there. Some other siblings involved. And so why wouldn't we use our flights? Why wouldn't we,
and this is just an option, I'm not saying I have to do this, why wouldn't we, everybody move to
AZ, or and she gets a job there in Arizona, and then you take flights back to visit the
green kids, or you take flights back to visit the aging parents, that feels more balanced
than the solution that we, that you're presenting. There may be more to it that I know nothing about,
but I think the number one priorities here have to be you staying alive and healthy, and you being
keeping your marriage in a state where it can be healthy. And I think that has to go, as painful
as that is, I think that has to go above the aging parents and the dementia and the grandkids.
Completely agree, that's been my preference all along. I'm up against some resistance and
some different interpretations of rank and responsibility, the forms of obedience, and so this is kind
of the desperation throwdown of we had this discussion multiple times, and I'm finally at a point
physically and mentally where I have to start making a decision about my health.
Understood, and so that's that's the rest of the dynamic.
Okay, so you're just saying, yeah, I got to live, I'm going to do this. Hopefully there's a way we
can work it out to where this works. Do you guys combine finances right now? Yes. Okay, so the
answer to your question, just to make sure we at least hit that, is how do you afford it?
You're going to find affordable housing in Arizona, and that might just mean renting for now.
I don't know that I'd go buy a house just for you. I would just rent affordably in the area,
and then do you guys have a mortgage in Indianapolis, currently? We do the other piece to this,
is it's a larger house than we needed. We did get a good deal because of some family connection,
so it's going to be a bigger asset at retirement, but we are taking in a rent or that will
help reduce the mortgage, and we've done that before sporadically. My intent was to start renting,
and then see later, if I would end up in the condo that we would ultimately retire in,
because renting for 10 years doesn't seem to be terribly wise. What happens at the end of 10 years?
Is that kind of the time where you think aging parents might not be part of the picture? What's
what denotes 10 years? 10 years is when we're both 55, she plans to stay with this employer
and retire at 65, and then we spend the rest of our life out there. So really it has been the
plan all along at retire. But it really is then now we're seeing where the real priority is.
It really is with the job, not the aging, and parents was dementia. Those are just other factors,
but those were things to sell. If you took the pension out of the picture, what would you do?
Because I think she can get a great job in farm. I'm making six figures, and you guys can build
your own wealth over a decade instead of hanging on to all of this just for a pension while your
marriage is down the drain. Yes. And so those are some real hard things to consider. I know your
health is paramount. You've got to take care of yourself, but I don't like the options that we have
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Sarah is in Boston, Massachusetts. What's going on, Sarah?
Hey, guys, thank you for taking my call. I really appreciate it.
What's going on? Well, my question is, is it unwise for me to move out of my mom's home while
paying off my debt? Oh, how old are you? Well, I'm 41. How long have you been living there?
I've been back home since November of 2024. Okay, what happened that got you back into her house?
My dad was sick and passed away so I wanted to go home and be able to be there for him while he
was alive and be able to help where I could. And then he had passed away in February 2025.
Oh, so sorry. Thank you. Did you move your whole life there? What like job and everything?
Kind of relocate? Yeah, pretty much everything Colorado. I had an apartment. I was at a full-time
job. I was at a part-time job as well. I was doing okay. This happened. I just really felt
led to come home. So I literally sold everything I could. What I could in my car and went back home
to Massachusetts. How much debt do you have? Actually, it's about 52,000. What kind is that? Break it
down for us? Yep. So I have student loan debt. It's around 33,000. I have a vehicle that I own.
Both little over $14,000. And then I have credit card debt around 4,000. Okay. Okay. And what do you make?
Currently, I make at my full-time, I make about 70,000. And then I have a part-time job.
Roughly I don't know what I make anyway there. It does change because it's part-time.
So I would say I can't hold about $40,500 in a month between jobs. 4,500? Yeah. Okay. So,
if you were, so it's been about a year since your loss? How's your mom doing?
She's doing okay. It's a different situation. They were divorced. They were
divorced for years. She was where I came home. I couldn't stay with my stepmom and my dad.
So I stayed with her. I see. I see. She's doing okay, but it is a different circumstance.
Okay. So, the purpose of you moving in with your mom was to be there for your dad.
It didn't seem like the purpose of that was to pay off debt because you had the same debt when
you were in Colorado with the apartment, yes? Yes. What caused you to not get ahead on the debt?
You just didn't have a mind to pay it off yet or you didn't have the margin?
Do you mean when I was in Colorado? I just didn't have the margin. I mean, I just paid
as best I could, but I just didn't have the margin. So, do you think that if you moved out and got
yourself in a nice, you know, a fine one-bedroom apartment somewhere around 1,000, you know,
$1,100 a month, you would have the margin to do that at that point? I don't think I have the
margin in this area. It's hard to even find a room. Are you in the city proper or you in a suburb?
I'm suburb. Okay. Do you work remotely or is it in person?
In person. Okay. So, I'm wondering, you know, how far of a commute could be handled to get
somewhere that's a little less expensive? Can you tell me the air? I'm from that area. I'm just
curious. What kind of area are we talking about where it's super expensive in the suburbs?
Because it can range. Metro West. Okay. Metro West area. I would look and see how what kind of
place could I get for just a one-bedroom on my own? And here's why. I think it's hard to not
stunt your growth in progress while living in mom's house. I would say 90% of the time someone
tells me they're living at home. They're usually not making the progress they should be based on how
little their expenses are. I'd rather you have an outside roommate than live with mom or dad.
Because I think you can get out of this debt in even renting your own place. You can be out of
this debt in two years if you got serious. About two grand a month, your debt's cleared. Yeah.
So, the question is how do we create that margin of two grand a month even if we were renting
somewhere? And if you're bringing home four or five grand a month, all right, now we know we need
to live on three grand max to make this a goal happen. Right. I think that's what I have been. I know
I don't see you guys. I have bank cell attends. I know I haven't. I know I'm just trying to kind of
manage life right now and still have fun, but they all get to. So, I think I know I can do better.
Like, I know I can go four fours. I just find that when I do that, it's like it's just
interesting things that are stressful, you know, but at the same time. It is. Yeah. I mean,
it is hard to the things that we're talking about. Again, they are simple to say, but when it comes
time to do them, they do. It takes a lot of mental energy to stick to a plan. It takes a lot of
mental fortitude to do the things that you say you're going to do on your budget. And it really does
become a full-time job, you know, to pay off your debt. It's like, all right, every day I'm thinking
about it. I wake up. I check my every dollar budget. I'm tracking my transactions. I'm having
to pack my lunch. You know, I'm having to make sure I take the food out, you know, of the freezer
for dinner. So, I'm not ordering takeout. It is a lot, but you kind of have to reframe in your brain
what's more stressful. Is it more stressful to be 41 years old and, you know, not really able to,
not feeling confident to do life on your own or is it more stressful to for how long was it, George,
two years, two years, two years, two year and a month, you'd clear this.
I'm ready to do it because here's the question mark. Can I ask you this? How much progress have you
made while living at mom's house rent-free with no expenses? Have you thrown all the extra at the debt?
No, I haven't thrown all the extra, but I have paid off debt. I have paid off several lines of credit.
I mean, I am doing it, but I have not, I have not played every, you know, ever. You got to,
you got to feel, you got to feel the boiling water. It's like a lobster. You got to feel the
boiling water. It's going to make you want to jump out of the pot. And that's not a knock on you.
I think if I asked most people, they would say the same thing. In fact, I talked to one couple
who went further into debt while living with their parents under the guise of, well, we moved in
so we could pay off debt faster. But instead, what happens is you get kind of comfortable.
You don't really feel the fire when you have a place to sleep and you're not even paying the rent.
And so you go, well, I need a little cushion. I deserve, I deserve to go out tonight.
I deserve to do door dash. Yeah. I think when you're on your own, it's going to,
you're going to feel it in a good way. Where do you go? These are my boys to pay now. And I'm a grown
woman. Yeah, I'm going to knock out the stand. I miss some, I miss things happening at home where
I definitely give pushing the button or I'm like, okay, I think you're on my side too. I didn't want
it too. And there's the social component too. Yeah. There's the social component of you being
able to live your life and meet someone and all those things that go along with this. So just
remember, money touches every area of your life. And for you to be really that full complete person,
you want to get those areas healthy and put them in a place where you can really grow to your fullest
potential. And living on your own at 41, it's just, it's got to be part of the deal. Yeah,
this is a choose your hard situation. Yeah. Either way, it's going to be hard, but I think the
independence that you'll feel actually will cause you to make more progress. Well, yeah. And then
there's the time limit to because if you say, well, it's just harder for me to get out of debt,
then you're going to be struggling indefinitely. But if you say, well, it may be hard to get out of debt,
but it's only for two-year period, then you get to shorten the length of the hard season. And that
to me is a no-brainer. Yeah, that's true. We got time for a quick social question which you
have to say. Yeah, which one? This is from Tracey and the Ramsey Baby Steps community. What are
your thoughts on credit cards that offer zero percent interest? If someone budgets, wouldn't these
be a helpful financial tool? Okay, so I'll be honest with you and George, this is where I stand
on this. I know plenty of people who will say, oh, yeah, I'll just take it and I'll pay it off
every month and they never will. They think one thing and another thing happens. The promo period
ends and now it's 29% APR all the way back to their start. Yeah, or you fall on hard times and what
you intended on doing just doesn't happen. There's so many variables that can keep somebody from
paying off a zero interest credit card. And then there's a whole thing of like, okay, maybe
maybe there's no interest, but it's still something that you owe if you allow it to accumulate
just a little bit. You lose your job. It's just another added stressor. So for me, it's kind of like
what's the problem with making an income and just spending the income? It's kind of like,
it's kind of an insult to yourself to go to your job and work hard every day and give your time
and your money and your effort. And then you look at your paycheck and you go, eh, that's not
enough. Yeah, toss it to the side. I'm just going to take this credit card instead. I like that.
Just become your own line of credit with money you actually have and that's zero percent interest
money all day long and my checking account and I don't have to pay it back. And you make more
intentional decisions when it's your money and you're using it now. So that would be my retort
to our friend Tracy.
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Well our team has been working hard behind the scenes to bring you guys a brand new tool.
It's called Ask Ramsey and it's our free AI tool that is built and trained on proven Ramsey
principles and today we're going to break down some of the most asked questions from the week.
And there was a lot of themes here Jade. Yeah people are asking of course we're in tax season
so they're asking a lot of questions about taxes and mortgages are always a hot topic and so
refinancing should I pay the mortgage off early all of that and then cars George. Cars seems to be
a very popular topic as well. A lot of drama and emotion around cars and here's the number one
question we've been seeing. How do I know when it's time to stop putting money toward repairs
and decide to sell it and buy something else? Very common riddle. So let's go over just some
basic things to consider here. One is how much is the car worth versus versus the repair cost.
If the car is worth three grand the repair cost is four grand. Well this is a bad idea. Yeah and
you know here we're always telling people to get a cash car a beater and so they're thinking okay
I'm doing a lot of repairs to this car you know is it too many repairs if I hit that point where I've
just in the shop more than I'm actually driving. Exactly. That's a problem probably time to replace it
and then are there repairs around crucial safety items or is it like this would be nice to have
or it's cosmetic or just it's an annoyance. Yeah. And then your personal budget matters too. Do you
have the money? Can you even afford a different car? You might not have a choice. So I thought it'll
be fun to actually pull up ask rams alive or folks in the booth have it running back there and
let's use a real life example because what's cool about ask rams is it'll personalize the advice
and ask you questions to dig in just like we went on the show. So let's try it out. Let's assume I
have this is a real car that I owned not too long ago a 2009 Honda Civic and it's worth about
$2,500 which hurts my heart and there's a transmission repair needed for about 1500 bucks. All right so
those are our numbers the cars worth 2,500 repair is 1500 so they're going to input that and it's
going to be asking them some follow-up questions. Here it is. What's the estimated repair cost?
It's $1,500 and it says how does it compare to your car's value? Well the value is currently
$2,500 so the goal here is ask rams you will kind of help us make a recommendation what we should do
next based on our situation and it does an incredible job our team has been walking us through this.
I am so impressed with how on brand it is it's the advice you would get right here on the show but
you don't have to call in and hope that you can get through the phone line. So this is something
you guys can jump on ramsysolutions.com and do for yourself right now. So here's what it says.
If it's $1,500 gets your car running reliably for another year or two and there aren't any other
big repairs coming fixing it is likely the best move. I couldn't have said it better myself.
Yes but you should experience the full potential by signing in. Yes because it can save your chats
which that's a good that's a good point if you sign in it can actually save your chats and
you can go back and reference it and continue the conversation. So here's my challenge to you
guys. I know you've got questions. So jump on to ramsysolutions.com. Try it out for yourself. Give
ask ramsys a test bin. It's right there on the homepage. Go to ramsysolutions.com you'll see a big
open kind of search bar there as you scroll and that is ask ramsys you'll see our faces next to it
or click the link in the description if you're listening on podcast or youtube to check it out again
ramsysolutions.com the tool is ask ramsys we are very excited to see how it helps so many people
that we can't get to the inboxes full for the ramsyshow people that we just simply don't have the
time to get to. So think about this it's like Google but a thousand times more powerful because it's
not giving you a bunch of random answers that you don't have to look through it. Exactly. So check
it out. It's great. Laurie is in Memphis Tennessee up next. What's going on Laurie?
Hey thanks for taking my call today. Sure. My husband and I have always been on the same page
financially. We've been very blessed and we are debt-free. We have 2.8 million invested.
We take out just a minimal each year to live on but we do have some fun you know we like to travel.
We've purchased a new car with cash different things like that but we have a little bit of hard
letting go and just leaving you know afraid of what might come around the corner. How long is that
going to last us? We've retired early at 55 on 58 here at 60 so we do have a way to go you know
with health care concerns and everything coming up. Sure. You guys can go another 35 plus years.
So it's wise to be thinking about that and you said you have 2.8 in your nest egg. How much are
you pulling off at every every year? Every year together we're pulling out 79,500.
Okay let me give you the numbers on that. That's 2.8% of your portfolio you're pulling out
every year. And if you talk to any financial advisor in America they would tell you that you
would never own out of money if you were taken out 4 or even 5%. You know with health care costs
the way they are today. Even with health care costs are entered down and it's just it's just
difficult for us to let go. Sure. Well what you can do is you can kind of estimate hey if we have
long-term care insurance here's here's how much we're going to pay for that versus paying it out
of pocket. Most people are not in a nursing home or private care for 10 years. They're two years.
Yeah. And so now you know all right it's going to be 100 grand a year for that so we should set
aside 200 to 400 grand to cover us for those things down the line. That's kind of the worst-case
scenario right? Yes. And so now you know hey if you you have 2.8 million if you just live off of
the growth and leave the principal you'll be just fine. Because I know what the stock market has
been doing I don't know what you're invested in I hope it's not just totally in bonds and cash
and you've actually got some equities in there. Do you know what you do with the financial advisor
and and we do make a good return I think we got 17% this past year. Yeah 17% so think about that
on 2.8 million that's enough for you guys to spend for like five years just off of that.
Yeah. And so I think part of it is looking at the math and the reality of it and then part of it
is flexing the muscle of gone man we work so hard to flex our savings muscle and it is looking good
and then this other muscle the spending muscle is atrophied in the meantime. And so it takes time
it takes time to let go. You wrote a check for that new car how much was it?
Well we want to trade in and we spent $47,000 cash. Did that shock you? Did that hurt your soul a little
bit to write that check? It did. And then next time you do it it's going to hurt a little less isn't it
because you're like oh I've been here before we're going to we're spending 50 this time and it's
kind of like all right our life didn't change we're not broke. We've always paid cash for cars
our home is paid for we put our daughter through college she's graduating with a four-year degree
and her master's degree this this May. Amazing. And she's going to be you know debt free from college
so we've done the right things it's just at this point we're still young to be retired and
you know we're just afraid of taking that next step and kind of let go a little bit. I mean even
to the point of you know we thought about putting on swimming pool for example and that's $70,000
we said we can do it without swimming pool. I think what George says is a really good exercise
when you feel fear about something you've got to decide is this something I can solve like usually
the ones that are kind of like vague and kind of ambiguous oh if I spend this money on the pool I'm
going to ruin everything well what's that mean like drill that down and try to make it a more
realistic fear so that you can actually solve for it what are you going to afraid what are you
afraid is going to happen are you and one of the things you mentioned is health care are you
afraid that a $70,000 pool is going to keep you from having health care in your later years well
then you just you have to ask your scope is that actually true and when you say no it's not because
I ran the math it's not true now now we're talking about true versus false it's not even you know
a thing of fear anymore is that even true can I give you something that's true if you made 17%
on 2.8 million that's $476,000 oh I know that's multiple swimming pools and that's not even touching
the principle and so again looking at the facts and going we're going to be okay the pool thing
comes into play because when you refill your house can you get the money back out so we're all about
resale you're not even thinking about reselling your house because you're thinking about putting in a pool
that's a question for your kids to have if this is where you want to stay long and the
resale value it's likely not going to tank it may not go up significantly enough to cover the
cost of the pool and the maintenance but you're not doing it for that you're doing it to enjoy
that's why you work so hard and retired early and busted your butts investing over the long
hole so that you can enjoy it so remember this part live like no one else so that you can live and
give like no one else and part of that is literally forcing yourself to enjoy the money in a budget
and so I would up your fund money Lori and up his fund money to an amount that kind of you're like
this is uncomfortable to spend this much on myself because you go I don't deserve this I'm not worth
it what if I run out of money and instead start going I deserve this and we're not going to run
out of money we set ourselves up for a life of abundance not scarcity and doing that budget and
forcing yourself to spend over time I think you'll get there in a good exercise go do the pool
and realize you're okay we're down to 2.7 three million now oh no yeah what are we gonna do
you got this
you
Gloria is in Albuquerque up next what's going on Gloria
hello thank you for taking my call so my question is we are on baby steps six
and my husband and I are both teachers our son is 28 he's been married for five years
this last year he has stopped working to do a full-time Christian recordings he's a musician
he's a Christian recording artist it is not paying him at the time he's trying to build up an album
he has about 47,000 monthly listeners and so yeah 47,000 is that like Spotify listeners yes
so you probably made four dollars this this month from Spotify that's exciting absolutely
love it he's also the music minister at church that does pay him about 500 monthly his wife is a
teacher also and so right now she is providing financially we're hoping that this ministry
helps him provide financially but we he's living they are living in our rental the rental
has not been making any profit they pretty much just pay the taxes maintenance
and so even though we're on baby steps six my husband and I are contemplating on just
gifting him the home or gifting them the home and that's my question
am I are we doing this wrong are we supposed yeah financially I feel like God is just providing
in every way possible we don't even feel um not getting that passive income we don't feel it
he's just we're blessed right now and so that's my question the rental is paid for in cash
you don't own anything on it the rental the other rent has been paid um we paid that off quite a
long time ago and in our home we owe about 86,000 we are set free um thank God but um we're not
done when will you be done with yours while I'm hoping in five years or sooner because we can
put we we can put about 2,000 extra a month and I will be graduating with my PhD in December
and so I feel everything is in place what's your home worth it's worth maybe about 300,000 our
neighbors have sold for about 500,000 what's the rental worth I'd say about 150 but it would
probably sell for less okay so why gift it to him why not just say you guys don't have to pay
the cost right now for a season because there's there's also tax implications you got to think about
because if you if they inherit the house a little of a step up in basis versus what you paid for
it now they're paying you know the capital gains if this house continues to appreciate so that's
one piece and the other part is I don't like artificially propping up their life because I want
them to have a sense of independence and be able to cover their bills on their own and I also know
he's pursuing a dream right now and he's he's on the way like he's doing great and I also know that
Jade and I are musicians and there was a time I was working full time and doing albums and playing
gigs at night and that's just the path of being a musician and being in that world and so I would
encourage him to figure out a way to cover his own family's bills while pursuing this dream if
that's possible I hear you that's kind of how I started this journey too is I hustled quite a lot
to start these steps and my husband and him were like no I don't want to do that and then when they
saw me like getting stuff paid they're like all right talk to me and then we all have done the day
around the baby steps and yes everything you're saying actually makes a lot of sense I guess being
emotionally invested you know he's our son and two the most important thing is that it's
a ministry that he's you know doing to try and bring others to Christ and that's where it gets
really tricky yeah I mean you can you can support you know if you want to support the ministry
in that regard that's fine to do that and say hey we want to gift you a thousand dollars a month
for the next year so that you're less worried about your bills and to support you as you pursue
this album who's who's paying for the album because that's not cheap
they have money saved up they like before he got married I made sure he had a fully
funded emergency fund and yeah okay so they're not struggling and everything they didn't do this
out of a place a place of desperation they're still doing fine even with teacher salary in his
600 bucks a month from minister at church they're doing okay they don't actually need your money
I just see I don't see those things because I'm it yes I need it and that's why I called
because I'm like I need to see someone who's not emotionally is it involved is it just you or
is it your husband too well tell us my husband I think he's our son and he he is 100% on board
with this or does he have any qualms no he has no qualms we just feel I don't know I just
were trying to stay faithful to God and and I feel like he's just telling us to listen I'm not
I'm not going to tell you tell me God told me to do something I'm not going to be the one to tell
you know I'm going to get struck by lightning getting in between that right but if you want to know
just practical or logistic thoughts I I'm with George in the way that I think they're at a
critical point of deciding what they're going to do and having the having the motivation to work
for it for most of us the motivation is I got to take care of my family I got to make do you know
what I'm saying I have to hit certain standards in order to live and survive and provide a life
and that creates great motivation and when that's kind of taken out from under you in the form of
a gift it can actually end up taking away right it's like you can feel like you didn't really earn it
in a sense yeah we we've talked about can this move hurt him is it is it removing
um part of his contribution because they're so young they're so young they're just getting started
they're 26 you said 28 to be married five years okay oh 28 here's what I was to do as a parent I
would not cover his bills I would help fund the dream I think that helps you separate this in your
mind I'm not helping prop him artificially I'm just going hey I believe in this mission I believe
in this music I'm going to help pay for the publicity for the album or I'm going to pay for the
recording studio time for the album and you could start as a great blessing and you could still have
the goal like knowing in your heart you are going to gift him this this home and you know initially
or I'm sorry eventually but just not yet I just feel like if you're asking my opinion it feels
very early in his growth and in his career to do that okay and and our journey to financially
I just you know we're trying to see should we skip this step because we are not in step seven
and that's where like the rule I mean we ties but we don't give like we want to
um so hopefully we will get there what do you mean by should we skip this step well because we're
on baby steps six uh-huh and then when we really give that's what comes at baby steps seven when
you just yeah when you're just like ready to okay where am I gonna and that's the other part of this
that's the other part of this is you still have a mortgage that you need to pay off and I'm not
suggesting that you need to sell this house and pay off or merge anything like that but I am saying
that you to get yourself in the proper position to really be able to be that outrageously generous
is going to make you feel even better about the gift I think when the time does come okay good very
good um advice I had not thought of a lot of angles that you all brought up so that yeah there's
some big implications it's a big financial decision and so I would just start small and you can always
ramp it up later and so if you want to let them not pay for living in the rental right now that's
a nice thing to do yes if you want to give money towards you know whatever pieces are left for him
to fund the dream that he wants to do that's also wonderful but I wouldn't just give to him a house
right now there's a lot of dignity is there there's just a lot of dignity and going out and being
able to provide for yourself and hit those milestones that I think we all want to hit now I'm sure
there's a lot of people listening right now going you're stopping him you know you're stopping
from getting a house like your plot yeah and but it's true you know there's something to be said for
that um well the thing is he doesn't need a house right now he needs a successful music career
yeah so anything you can do to actually help that part I would aim aim my my financial guns
there yeah versus just helping cover the bills because that's not really where they're struggling
what he needs right now is get the word out you know let's get more listeners let's get maybe it's
I don't know if it's a record deal a songwriting publishing deal there's a lot of other moving
pieces this and I wish him the best 47,000 listeners is about 47,000 more than I have so keep it up my man
welcome back to the Ramsey show in the fair winds credit union studio I'm George Campbell joined
by bestselling author Jade Borshaw and we're taking your calls at AAA 825 5225 Elijah's in Boston
up next what's going on Elijah hello how you doing we're doing great what's your question today
so uh my fiance and I we currently have uh 130,000 dollars saved up um we have an additional
hundred into like stalking stuff but we really just want to leave that and we're looking to use
the 130 to buy a house first initially we got pretty approved for like 350 we put in an off
on the house had an inspection done and found out all these things are wrong with it so we backed
out of the deal and um we're like well maybe weeks just build a house we have no experience doing
that though and um it's the wintertime where we live we're actually living in a camper right now
uh we did that we sold our house bought a camper this way we can downsize and save some money
so you had a house previously that you owned yeah this was about five years ago that we sold it and
you know we kind of downsize we we wanted to just kind of you know have less fat um we
really didn't need that much space anymore but now we're finding ourselves in a position where
do we buy or do it do we build um what's your budget for the house um
with the where's our budget to so we were looking to spend if we build 130,000 it's pretty much
our budget not in the land we figured we'd finance the land and just you know pay everything
outside of park okay well all in then how much do you plan to spend so 130,000 on the on the actual
home how much would you spend on the land so we for example we found a piece of property in the area
where we live it's 40,000 we put down 25% that's 10 but you know we still got to do a septic or well
you know all these utilities and and it's so is the goal to live like off you know off property off
the land somewhere not in a society is that your goal well not not like off grid that that would be
great but it's just we're in our area it's really not an option um you know most of the land that we
find is like we have to be on utilities to some degree in this area is this you know I'm excuse me
I'm our goal is just to be debt-free we have all this money more like why do we need to go be in debt
right now well it almost sounds like you had one bad experience and it's kind of turned you off
to the whole thing and now you're kind of gone not to say that building house is an extreme but it's
kind of like you went to the extreme of well if this didn't work out we just have to go build our
own thing and start from scratch um right if you if you want to build a house and start from scratch
I think that's great uh but if you just had a bad experience and maybe you just need to spend a
little bit more time with another realtor or you know looking at some different properties I why not
just do that so I think you guys have to decide what it is that you actually want yeah what do you
want well I guess what did it yeah that's the thing is that we just don't want debt like in our
area the houses are just selling for like well above uh you know what we're willing to pay you know
$400,000 in these houses are still like fix their uppers you know and it just it just doesn't
justify putting ourselves in debt right I see how much do you guys make uh so we make
together over like about a hundred and twenty thousand a year great are those remote jobs or
you have to be there in office well I'm a school bus driver and uh and she's a nurse so we have
to be in office okay because I'm just thinking you don't want to be 45 minutes out somewhere yes
with septic and trying to do all that first of all it's going to be a full-time job if you're
going to build from scratch and deal with all these contractors and so I would start for now
to avoid the headache of what you guys can afford in your area and even if you had a small mortgage
that was very reasonable as far as your take home pay is concerned that's okay that's not a sin to
have a mortgage and you can knock it out fast and get aggressive with it and if you're going hey I
cannot find anything for $130,000 welcome to 2026 in America especially in Boston, Massachusetts
which is where I'm from so I can tell you it's not cheap over there and if you guys look there
you're going to have to decide do we want to rent and for a while until we can have more money
so that this is less of a burden or we can pay cash or do we just want to go we're going to put
as much down as we can sell the stocks put 200 grand down and get a 50 or a hundred thousand dollar
mortgage how long did it take to save the 130 well honestly it took us about a year or so in
a lot of it had to do with when we sold the house yeah how much of it came from that well honestly we
have in total 230 but I don't know what we what we have in the in stocks like what we gain I mean
you know like what it's valued at but so you have 230 hold on let's sort through this money yeah
how much is in stocks a hundred of it is in stocks and then we put 130 away for like it's called
our house fund okay so you have if you were to sell off the stocks somewhere around 230 total
okay yeah I'm asking yeah is there any money anywhere else we should know about okay does that
um go ahead no no no nothing else okay so you would definitely want to have some sort of an
emergency fund set aside so some of that money needs to be set aside you keep it liquid keep it
in a high yield savings account but I'm with George I think that if you can I hate debt too I do
but I think with this real estate market there is something to be said for getting in when you can
get in and when you can actually afford to do so and I think that if you guys can find something
that's no more than 25% of your take home when it's all set and done on a 15 year fixed rate
I would do that in two seconds yeah and that's exactly what I did Elijah we on our first town
home my wife and I we put down 40% because we're crazy people and then we paid it off in 26 months
because again we're crazy people that's what that's what I suggested I'm like well what if we just
put down more money at least then we'll have you know our mortgage won't be so high you'll have
less debt and and then we can work on paying it off faster and even if we have a decided set
that we have more equity in the house exactly and so that's what I would do put down as much as
possible which lowers your mortgage and your payment which allows you to have more margin to throw
at the mortgage to knock it out fast because here's the other thing you got to think about if it
takes you five more years to save up and pay cash well guess what happened to the housing market
in the next five years it went up yeah the moving the goal post keeps moving and so do it when
you're financially ready when you can get that payment to 25% or less of your take home pay on a 15
year fixed and you find a house that you guys go this is great yeah I mean if you if you sold off
those stocks let's say you kept 30,000 aside for three to six month expenses and let's say you
found something that was worth 350,000 you put 200 down that's great 15 year fixed rate mortgage
you're right in the parameter that you need to be yeah what you're going to get for 350,000
dollars may not be what you're picturing in your mind but you got to start somewhere and you got
to get in where you fit in yeah and in two years from now that houses paid off and now it's worth
400,000 exactly now you can roll all of that into another house and do the same thing or even pay
cash with the money you can save your time I really hope that there's a way that I can get this call
and play it for my fiance because I've been trying to say this and she's like very skeptical
understandably so but she actually introduced me to you guys oh right listen she will listen to Jade
Warsaw yeah I'll tell you that much and you're lucky for you everything we say is on the internet
forever so you can tune in on YouTube and catch this call and we can have our team send you a link
as well so that you don't miss it like that yeah get into that if you haven't already go to ramsey
solutions.com and look at the mortgage calculator and that's all I used to figure that out for you
can use it to and you can calculate it at an interest rate 15 year fixed rate and that's how I did
it so I wanted on the website you can reach out to a real estate pro in your area and this is a
crew that we have vetted real estate pros that do it the ramsey way who aren't going to let you
buy a house that you can't afford who want you to become debt free as fast as possible and so man
I think you just need some tools you need some tools some math some reset expectations and maybe
let go of the baggage of the past of how we feel about home ownership either way it's going to be hard
but I love your dream of becoming debt free as soon as possible
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and get the preferred package before it's gone gonna be a good time david is in new york up next
david welcome to the show hey guys thanks for taking my call love the show thank you so my wife
yeah appreciate it my wife and i are in baby steps six and about a year and a half ago i was laid
off from like a tech executive leadership role that i had i was making really good money where
we were applying through paying off the mortgage and saving for retirement and then for the following
year i just really hunkered down and was applying as a full-time job and i i applied to fifteen
hundred jobs and i stopped counting but about six that six months ago i i uh took some some various
jobs that i could find in my network here but my income is going down from like two fifty plus bonus
down to like fifty k and my wife works but what i'm trying to decide now is be like keep looking for
tech jobs in this greater new york city area which hasn't really connected yet where do we take
the equity out of our our home here and move to a lower cost area that we've already been talking
about doing uh like north carolina or the greater land area where there is a tech economy and
the hard part there is the grandkids so that's the high part of wrestling with the other grandkids
new york city uh yeah i have uh three of my four adult children live in the area and they are all
now married and have little ones oh that's fun oh that's taking the job out of it yeah take the
job and then come out of it what would you guys do stay in new york city or move we would move
and we've already had two of our adult children say that they would follow us because they can't
afford to live for either so but you know so it's like hey we could all use some lower cost of living
you'll just be the first to go okay well have you applied to jobs out there do you have any connections
out there i have i mean i don't apply up and down the east coast with some of those tech areas i
i think what happens though is they don't take you seriously if if it's a hybrid job and you don't
live in the area it's really hard to break through um so i wonder if i position myself there if they
would take me more seriously as a candidate it would be easier if you're local exactly yeah and i
had a lot of interviews it seems like the whole remote tech thing has gone now to hybrid things
yeah that's the idea and people are going up i want you in office at least some of the time if
not the whole time and so that's that's i think going to be their foreseeable future i would try
out some of Ken's tools and resources before you make any decisions because he's got a great book
called the proximity principle and it'll help you figure out how to not just be another digital
you know resume application and a stack because applying for 1500 jobs you can pretty much do with
the click of a button and so you and everyone else and a i is now applying and bots are applying for
jobs and so you've got to stand down the crowd you've got to know somebody you need to have some
kind of connection referral and even here at Ramsey the ones against that to the top of the pile
are the referrals from team members are going hey my buddy he's sharp he's applying for the job
can you guys take a look at it and straight to the top of the stack what would it mean what would
it mean for your wife's job if you guys were to move yeah she has a job thankfully her company is
national and she can do her same job anywhere okay good is that she has the health insurance
right now so that's good news great what she earned she's making about 50k okay so you guys
are making it work in New York City right now on 100k yeah we it's it's tell you we have about
two hundred dollars to rub together at the end of the month but as long as we don't have a major
expense here's the part that scares me though is our emergency fund went down from 50k to five
carry yeah that you're it's precarious for you yeah so you're you're partially sort of artificially
funding this from the emergency fund yeah I mean most months we keep we were trying water if there's
a big expense it does get back into which is scary obviously yeah this is becoming more and more of
a it would be nice to we have to do this yeah I think so too I agree you're on the cusp of
going out and saying they have every weekend if you didn't do tech what would you do I mean I've
looked I know I have transferable skills so I could I could lead like a client services organization
I'm helping my friend right now with like you know revops and building out his construction
business I haven't yeah have you applied for like adjacent type roles I have a five versions
of my resume and I've I've been applying to a variety of them but I tell you the best interviews
that I get are the ones that are like you know executive recruiters that reach out to me that tends
to go further I sure finalist more time so I can count yeah I might be worth kind of using a head
hunter to help you get in the door if you have that level of experience and people are looking for
top talent so there's a lot of things you can do and I just don't want you kind of spin in your
wheels while running out of money in the meantime and so that might mean finding extra jobs right
now just to float you to not dip into that emergency fund until you guys decide to move or you get
a different job and it might be on her too I think she needs to find a better paying job if you
guys are going to stay in New York City yeah I know it's tough here it's very expensive
actually we have a ton of equity in the house so we're gonna if we get if anyone we do
make out really well but I imagine being able to buy something in cash in you know North Carolina
and make the move and make more money than you're making you're gonna feel like a bajillion
fabulous woo well I'm wishing the best man that's a tough job market it's it's not on you it
it just really is tough out there and it's gonna take getting a little more creative and a little
more personal to get that gig Tori is in Dayton, Ohio up next Tori welcome to the show
hi thank you for taking our call we have a 30-year mortgage and are wanting to pay additional
on the principle so we can afford the 15-year if we drop our investing from 15% to company match
for only two years in addition to what else we can squeeze from our budget we could get the
principle low enough to afford the 15-year would that be wise or debt free except the mortgage make
175K annually and already have 350K in retirement cool cool cool so you're saying you want to
lower investing in order to afford the 15-year payment as far as if you refinanced?
yes yeah and just lowering the retirement so it gives us an extra grand a month to put towards
the principle on top of everything else we're gonna be throwing at the principle
I why do you feel the need to refinance why why not just throw any and all extra money at the
principle when it comes time to to do so so we are doing that I think just sometimes when we look
like on your own um calculator and things it's just like so much interest we're paying and so we
would like to get to the 15-year but the first thing you pay the less interest you'll pay
technically afford it with the principle that we still owe yeah the principle still applies though
as I mean principle PLE that if you put extra on the 30-year you're you're gonna save interest as well
right and so I wouldn't do it I mean I'm a big fan of the 15-year mortgage but there's there's
a time a place to refinance and that is your debt free except the house you're investing 15%
and can keep it there right you can comfortably afford the 15-year payment and you got to think
about the break-even point it's gonna cost you two to five percent of your loan to refinance
so if it costs you eight grand and it saves you four hundred a month well you got to stay there
20 months just to break even and so that's the part that that worries me I don't know that you're
gonna see significant savings instantly to the point where this is a no-brainer now if you had
an eight percent mortgage and you can go down to a three percent that might well the numbers might
make sense but if you're gonna go down one percent and it's gonna take five years to break even
just so you can feel better about it I wouldn't do it I would just pay aggressively on that 30
and pretend like it's a 15 okay okay that makes sense thank you absolutely you can crunch the
numbers on our mortgage payoff calculator yeah just use your 30-year and say if we put two grand extra
a month we would save a hundred thousand dollars in interest and pay it off in the next seven years
and so just you can still be aggressive about the goal and maybe there is a time in place you
refinance and it makes sense but I don't know based on what you told me of having to lower investing
to make this happen that's the part that I was like eh that doesn't feel right if you go back in
time we probably realize you shouldn't have bought this house with this level of mortgage right but
here we are it's okay you guys are doing great you're crushing it you got money in retirement you
make great money I would just aggressively attack it knock it out and a great reminder if you
guys want to check that calculator out it's completely free ramsysolutions.com it's our mortgage
payoff calculator it will light a fire under you to see that amortization schedule indeed and how
much you're giving your lender as a gift for them giving you this loan it's generally in the
six-figure range what you're going to see is what you gave them on top of the loan that hurts your
soul hey guys what's up it's Jade and I'm pumped for the new year and I hope you are too but the
problem is most people start the new year with a lot of promises and no real plan you know how it is
I'm gonna save money or I'm gonna get my financial act together but without a plan you just
wing it and hope it works out listen don't play yourself I want you to win and our every dollar
app is the game changer you need in 15 minutes every dollar helps you build a plan based on where
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in the lobby of ramsey solutions on the debt free stage we have Brian and Tara with us welcome guys
hey where you guys from we are from Clarksville Tennessee right down the road wonderful well
thanks for being with us to celebrate congratulations how much debt did you guys pay off thank you
we paid off $411,000 500 it's a lot of dollars it is how long did that take it took eight years
and seven months wow awesome and what was the range of income during that time uh 70,000 up to
250,000 now wow what what was the uh raised due to was that just you guys working harder someone
got a job got promoted yeah promotions I mean we took on some side jobs uh started a couple small
companies as well throughout the way so incredible okay what do you guys do for a living I'm the
chief operating officer for a rating mixed concrete company okay and I'm a teacher slash stay at
home mom awesome that's a fun slash yeah okay and what kind of debt was the 411 so um it was
student loans uh two cars lots of credit cards um and then our mortgage wow we did okay did you
even stop to breathe or did you just go right through two three into four five six so we had a
little bit of a law after we paid off all the consumer debt um and then we just jumped right back
in wow that's exciting and uh I got to ask what was the mortgage comparatively to the consumer debt
so the mortgage was about 298,000 wow okay the consumer debt was 113 so what was the spark that
the flame to start all of this eight years back I'd say family uh per sister was following the
plan with her husband and they kind of talked to us about financial peace and uh we started
along the way yeah when we got married she gave us the CDs the total money makeover and we
listened to those together um skeptically yeah I was gonna ask how do you get someone on this
on that on the Ramsey plan because you must have taken it as a diss when she's like hey you need
you need this yeah listen to these CDs you guys are broke yeah well um she gave them to us and we
listened and we were kind of like uh we like it good ideas um so we kind of started paying off
a little bit of extra debt here and there but we did like the davish for about a year um it wasn't
until we took a job in Texas and we started making us a naturally uh larger amount of money um
and then we looked at our bank account one day and we were like hold on a second we're still living
paycheck to paycheck where is this race going um and we looked at all of our budget items and
kind of figured out where where all the money was going and we were like whoa we're spending that
much money going out to eat that is crazy so we got on the every dollar budget and we started to
just cut everything out that we didn't need to have and that's when we really started going
gazelle against all the debt wow you're sort of like we need to be doing better this is insane like
we were making so much more money and did lifestyle creep hit you where you were just kind of
spent everything extra that you were making yeah for sure I mean we were we were going out to eat a
lot of mean you never realized how much money you're spending the restaurants do you actually look
at it and so yeah it definitely hit us and we made more money but we spent it as well so how long
did it take to do the first portion so the first portion of this is like 111,000 that's like the
the consumer debt how long did that part take so that took us 22 months okay fast and so then
you decided you know what that feels really good we're gonna start working on the house and it
sounds like you really were just intentional about it not nearly as intense maybe as the other
debt or was it just as intense it was definitely more intentional I think we made a lot of sacrifices
and took on some extra jobs like he said we opened two businesses and that brought in a lot of
income on the weekends and yeah that's really curious what was your like life hack to paying off
this mortgage early because people in UC tick talks about how to do it and I go just pay extra on
the principle so were you guys paying an exact amount of an intentional goal or was it hey depending
on how much we have extra this month we're gonna just chunk it at the mortgage we just chunked it
the mortgage every month I mean whatever we didn't spend on the budget we we put towards the
mortgage what was like the lowest amount you put on the mortgage in a month and what's the highest
you remember so we we get a yearly bonus oh nice so we pretty much threw everything extra during
the year and then when we got the bonuses we would throw it at it that's incredible I think one of
the largest was $80,000 that's got a feel that's juicy yeah that's nice that is incredible well
you guys have worked your tails off have you done anything to celebrate yes just one just one
just one so far so what do you tell people the key to getting out of debt is house and everything
I think you just got to start chipping away I mean you look at the number and it seems like a really
big number you seem like you'll never get there but I think every little bit counts and you just
got to work your way towards it yeah and sticking with the budget also if we hadn't got on the
the budget we would have never been able to do it so figuring out how much you're spending and
cutting that down as much as you can I love it and you had some cheerleaders long way of course
family giving you the CD saying listen to this anyone else that was a part of the journey that
was pretty much it my sister they actually paid off all of theirs about two years ago so we came
and celebrated with them that's all so that's all so that little extra fire under you like all right
we're next yeah buckle up wow that's great so how do you explain the feeling to someone of being
completely debt free yeah it's hard to explain I don't even know like it just feels like freedom
you almost wonder what to do with your money the next month it's an odd feeling yeah that's
a good problem to have yeah what did you do with it the next month still save it yeah we still
save it we're we're hoping to invest in some real estate here pretty soon I love that maybe a
little bit going towards the kids one day I see some off to the side yeah get an ANC you want to
bring them up yeah okay let's get their names and ages as they come up on stage with you
was that a big why for you guys having the kiddos along the way because are any of them like
they weren't even born yet when you start the journey yeah this is Elliott she is five Cooper
is two and then we have a eight month old walking around somewhere with an aunt that's fun yeah
actually none of them were born when we started wow so a lot of life happened along the way
you got state intentional it may have slowed down in seasons here and there but you guys had your
Ryan the prize yes oh beautiful all right let's get quick buddy I'm sorry I'm sorry okay let's get
to it here it is we've got Brian and Tara from Clarksville Tennessee $411,000 paid off in eight years
and seven months making seven year 250 house and everything paid off count it down let's hear a
debt-free scream I'm gonna count the time as a cry for joy that's I'm saying an actual debt-free
scream oh my goodness we're screaming for all kinds of things he's probably screaming for some
I don't know milk right now he's hungry oh my goodness that's exciting that is exciting whatever
I love seeing a family mortgage oh especially when they have so much time on their side oh gosh
they're not even closer to retirement be bajillionaires like think about it how much wealth they can
build just investing that mortgage payment every month that's right you know it's too grand from
40 to 65 with compound growth you're like well that's an extra couple million right there yeah
these are people who understood that if you just decide the time is gonna pass anyway and you can
just build little by little and you look up and you're exactly where you want it to be but it takes
time yeah and he's so right you see that big mortgage balance and you're like well we can't
pay it off early it's $300,000 what's the point we'll just make the minimum payments we're gonna move
eventually anyways who cares that's just so passive that's normal in America and instead you want
you know what we're gonna knock out a little bit and a little bit and soon it's gonna be 250
and next thing I know it's 200 yes and now it's 150 yes now we're under 100,000 or like we can see
the finish line and it's so funny because people are afraid of the sacrifice but I look at them and
I'm like they're intact they live their lives they're closed they're closed don't have holes in it
like they look like they eat just fine you know I feel like they're here and they're fine and so
everybody who's afraid of the struggle or afraid of the timeline man just embrace it it's gonna
happen yeah and you'll look up and you could be just like them we have villainized sacrifice in
today's world you know George you said it and I got to go on that because it's so true and I
think the world you know the way the world is it it is set us up to not embrace the things that
take boredom patients sacrifice you know our brains they just want everything right now yeah and
that's not the way money works everything we teach requires boredom patients and sacrifice yes
if you can learn to be a crock bought in a world full of microwaves you're gonna build so much
wealth and be the weirdest person on the planet and people will go must be nice well they must
have got lucky must have had an inheritance they went yeah they worked their butts off to get
some luck maybe you should too
hey guys Dave Ramsey here every day on this show we help people work through real money problems
and figure out what to do next now you can get that same kind of help anytime with ask Ramsey
ask your money question and get answers built on Ramsey principles we use on the show whether you're
making a decision or just want something explained ask Ramsey is here to help it's fast simple and
free to use go to Ramsey Solutions.com and try ask Ramsey today that's Ramsey Solutions.com
our scripture of the day Joshua one nine have I not commanded you be strong and courageous do not
be afraid do not be discouraged for the Lord your God will be with you wherever you go amen
and ran said the question isn't who is going to let me it's who was going to stop me
ooh then fight with you guys say it with your chest. Jay just bowed up a little bit
all right Dwayne is in Jacksonville Florida up next what's going on Dwayne?
hi thank you sure how can we help?
all right so i'm wondering how much to spend on a replacement for my wife's car so it's right here
and now as a SUV we need a little more room next year three kids carpool so we're looking to trade
up for a minivan so this one I could probably get five six maybe seven thousand and i'm looking
for probably a good quality minivan that'll last a while basically so trying to figure out
how much to spend cool what do you guys make of your about 55 after taxes all right and what other
vehicles do you have? so i have a used acura and i just sold my Nissan for that okay so you get to
use acura plus this SUV right now what is the used acura worth? 17 and a half okay and you guys
have any debt? no just for the house awesome that's good how much do you have saved for the car so
far that's outside of your emergency fund so i basically have like eighty five or so a thousand
investments i'll fair amount of that as i decide for upcoming construction on a house but i'm
feeling like we could push that off a little and take a little more of that for our if that makes sense
what kind of investments is it is it just in a brokerage account?
most of the conservative in what's called with their investing probably i forget the name
it's just but it's just a normal taxable brokerage account it's not anything for retirement right
and there is a rough highway in there too okay but a lot of but you wouldn't touch that to use
for any of these goals construction or the car definitely not okay how much do you want to spend on
this thing? i'm thinking around 15 but i'm wondering if i might make sense to go a little
better and get something that'll be a bit more admirable for a longer time without spending too much
maintenance okay well i'll give you the parameters number one you've done it the right way so far
you're debt-free you've got an emergency fund you're gonna pay cash for this thing and the other
parameter is that you don't want anything with wheels and motors to add up to more than half your
annual income so take your gross household income what does that add up to is it closer to 70 75?
well my parents are actually really nice and still help out with me it's already willing me
so i don't really have to feel too much pressure to earn more quickly i have more of a long-term plan
with with earning more with the job trajectory that i've taken okay so what's your current household
income though you said 55 is the take home what's the gross? 68 okay so if we take you know your 68
right and where you divide that by two that means the max for all the cars in your life is 34
you own an Acura that's worth 17 so let's take that out that leaves you with 17 to spend on the car
that would be kind of my top limit for the car is that 17 grand i'll be very comfortable with that
if you guys have the cash and you want to buy a $17,000 used minivan i think you can get a great one
and if you focus on you know reliable makes and models in years do your research and go all right
we're gonna get a i don't know i'm making this up a 2016 Toyota sienna yes i'm like that
that you know so just kind of start to figure out what's in the range figure out when the biggest
repairs happen and what they are and how much they'll cost and then you'll kind of go into it
knowing what you're getting into get a pre pre purchase inspection on whatever car you get
so that you don't have to wonder if it's going to have issues later on down the road and i would
think you're going to be in great shape congratulations i can't believe i got to give someone good news
today jay yeah i love that so there we go let's get to victoria before we wrap your new work new
jersey what's going on victoria hi thank you so much for having me sure um so essentially me and my
husband are looking to start a family but we're failing kind of like it's not going to be possible
at the time soon with like the financial situation um not that our financial situation is bad we just
would preferably like maybe a state home mother so going to one income feels tight
right okay yeah tell us the situation you guys have any debt
we do we have a mortgage and a car loan the car loan is about 25,000 and the mortgage is about
500 thousand okay and then what do you both bring home every month my husband brings in about
165,000 for the year so about 12,000 gross for them are 8,000 sorry gross for the month uh-huh
and i'm bringing in 90,000 the year that was just a little bit over 4,000 net for the month
got it so the question is would you be able to just live off the 8,000 and maintain the lifestyle
that you have right um i'm leaning towards you know because we're essentially staving all of my
income so without my income we would have no saving um we do have a good amount saved and we do
have a lot of equity in the house so we're not opposed to you know relocating but the northeast
is just so expensive we're not relocating well and you can do it for us what's the mortgage payment
every month uh with taxes we're looking at about 5,000 a month oh there's your issue there's your
issue right there my friend now you said he takes home 8,000 that feels too low if he makes 165 gross
um well after you know 401k contribution benefits he's walking away with 8 okay is he investing 15
percent right now do you know the amount he's only investing about half like 8 percent
that it just doesn't track i know taxes in New Jersey can't be that high because he's walking
away with less than 100,000 out of 165 yeah somehow we still owe taxes every
similar year as well um so i really don't you know i see the paycheck that comes into our
grant account and it's pretty much 4,000 even you guys got to take a look at that tonight and
and just say hey let's let's see where this money is going because to George is exactly right i'd
be looking at that and saying is are we investing in an hsa are we investing in like how many
different places are we putting invested investments how much are we paying for health insurance out of
this is there any anything else coming out of this that we don't realize um is the withholding
right on all of those things i'd i'd take a steeper look at magnifying glass to that yeah what's the
car payment okay um the car payment is about 500 a month okay well i think there's going to be
sacrifices made here either way if you definitely like you i'm going to be a state home mom then
it's going to look like downsizing um not doing anything fancy and selling this car
okay do you guys have enough in savings to just pay off the car today uh we do we have about
a hundred and twenty thousand in cash and saving great what are you saving that for um we don't
know so i still have the money like what can we be investing in can we get into real estate
should we just throw everything into the stock market like how can we start making some
passes income on this to kind of make the situation better here's what you do this next house you
buy and downsize you'll use that money to then lower your mortgage payment towards two grand a
month and you get to be a state home mom right so i would not go like you have 19 goals right now
if i want to be a real estate guru and be a state home mom and i want to invest in the stock market
i would focus on the one thing that you said you want to do just stay at home so i would pay off
the car today if you love the car it's not too much of your income but we got to free up that
five hundred bucks a month so we can breathe when you become a state of mom and so it's sort of
pre-planning for this new life and then live on his income for a month see how it feels put your
income completely aside and go what would life be like if we had to live just on this and when
you relocate it's going to make it a whole lot easier to go from five grand to twenty five hundred
even right so that's the thing to solve for is how do we get our mortgage rent to be closer to
two grand out of this eight so that we have enough to still live our life to still invest to
still go on trips to still save for a kids college to still knock out the mortgage early and that's
going to mean a different lifestyle than you guys are leading right now but i think it's a worthy
and noble goal and i would definitely do it if i was in your shoes we definitely want to
awesome well once you sell the house you get some equity use whatever's left you know that
seventy five or a hundred k put it down on that next one and you get that mortgage down to like
two hundred grand instead of five hundred grand excellent now we're cooking now we can actually
have a reasonable payment and you can stay at home forever and not be stretched then it's a great
goal to have and it's a great reason to do the baby steps it's always found in the mortgage the
answers always lie in the mortgage and i'll get you that'll get you wow well that puts this
hour of the show in the books remember there's ultimately only one way to financial piece and that's
to walk daily with the Prince of Peace Christ Jesus
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