I Cosigned 2 Cars For My Mom And Now They're Repossessed

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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.

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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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guys the VIP package is officially sold out on the live like no one else crews but there's still

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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

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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