Being Completely Stupid Put Us In $148,000 Of Debt!

autumn is with us in Virginia hi autumn welcome to the Dave Ramsey show hi Bo hi what's up so we completely stupid you're going to speak directly into your phone I can't hear you I said we've been completely stupid and made a lot of really bad decisions can you hear me yes ma'am so I did the debt calculator on your website and it said it would take us 11 years to get out of debt following your plan and I kind of feel stuck do you have any advice to speed this up did that include your house no okay and how much debt do you have not including the house we have one hundred and forty eight thousand eight hundred dollars okay and what is that on twenty thousand on credit cards ten of that is in debt management 16.8 on auto and 102 in student loans who's the top album huh who's the doctor I only have 50 for solving student loans and I don't even have a degree oh you didn't you didn't complete what were you studying well I changed my major million times which is why I've gone to school like seven years how much was your husband's degree in he's a teacher and he had like 40-something Johnson okay which is your house payment a house painting is $600 okay and what's your household income right now fifty three thousand five hundred a year so he's working full-time and you're working part-time mmm no I'm not working I have a high needs 12 year olds that I do homeschool and I have a four month old yeah you got your hands full well the the debt snowball calculator that you used on our website assumes only that you pay nothing extra it only assumes that whatever you pay off goes to the next one when that one is paid off so if you have a $20 payment on your smallest debt you increase in the payment you increase debt number two's payment by $20 when that pays off you will pay more than that you should pay more than that and so you know so the 10 years is not accurate is my point so here's the way you do it you do kind of old-fashioned big number long division okay we've got a hundred and forty thousand dollars worth of debt okay ten years would be fourteen thousand a year that's not enough you need to pay more than fourteen thousand a year so if you took a hundred and forty and said we paid twenty a year out of 53 that'd be doable that'd be doable you'd be on beans and rice that's a seven year plan yeah okay if we sell the car it's a six year plan well I'm looking to selling my car but we're upside down it's worth seventh one of them is worth worth three point five but we owe eight and I got a loan also but it's at 65% APR not sure I should do that okay and the the other car is worth what about ten and it were you always right even we are right about even know you are wait you said you had 16,000 and car debt and you laid on each one yeah okay and so yeah that that one may be gone you may have to go because here's the thing every $20,000 you shed and a $20,000 year rate gives you a year of your life back and so right now we're at seven years at 20,000 a year you and I just making this up sitting here talking okay yeah and if we if we can get rid of $20,000 with a debt we would be at six years if we can increase our income by $10,000 and throw it all at the debt your husband taking on tutoring you working a side gig that you can work around with your childcare needs that you have that are real you know anything you know you stop work from home stuff you start selling stuff on eBay I don't care whatever you want to do but if we increase our income by ten thousand dollars a year now we put thirty thousand dollars a year on 140 now we're talking a little over three years that starts to smell a lot better than 10 doesn't it yeah so you're gonna be on beans and rice budget you're gonna increase your income and you're gonna consider selling some stuff real seriously and not rationalize and not go oh I have to have this because dot dot dot noop you don't have to have nothing you don't have to have nothing but food shelter clothing and basic transportation and so that's what you know cuz what is the goal here what are you willing to give up to hit your goal because it's not what people are willing to do that causes them to hit their goals it's what they're willing to give up to get their goal that causes them to hit their goals and there's always a price to be paid so you just got to look at that in the side I think if you'll bear down on this get on a real tight budget both of you increase your incomes not a ton but at least a little bit I think you're out of debt in three and a half to four years you might be out at three years because you're probably going to see your some things change around your house during this time so good question

Channel: The Dave Ramsey Show

Views: 123,214

Rating: 4.846962 out of 5

Keywords: the dave ramsey show, budget money debt cash, real estate, insurance, how to make money, dave ramsey, save, credit card, compound interest, buying house, buy, snowball, debt, credit card debt, debt free journey, how to pay off debt, how to get out of debt, money, student loans, debt payoff, how to budget, student loan, budgeting, budget

Id: 24-qJbTacCs

Length: 5min 56sec (356 seconds)

Published: Sun Aug 18 2019