When You Say "No" to Debt You Say "Yes" To Freedom!

ramsay show you can be intentional about your character you can have money and a career you are the hero in your story [Music] live from the headquarters of ramsey solutions broadcasting from the dollar cart rental studios it's the ramsey show where debt is dumb cash is king and the paid off home mortgage has taken the place of the bmw as the status symbol of choice i'm dave ramsey your host ken coleman ramsey personality and host of the ken coleman show is my co-host today as we answer your questions about your life and your money the ken coleman show is all about your career all about getting in a job and in a career field that you love doing work that matters that you're good at and where you can actually show up and be glad for the time you spend at work and the way to maximize it so you got career questions i need a job questions well ken is here to help with that and he's going to comment on everything we do here today as well so we're uh welcoming you in the phone number is triple eight eight two five five two two five so can this from forbes car shoppers on limited budgets can't get a break the average transaction price for a new vehicle is expected to rise to a record 38 255 dollars in may according to jd power sending many consumers looking for bargains on used car lots no such luck the combination of high demand and high wholesale prices dealers pay to acquire inventory has led to record high prices for used cars toby russell co-ceo at onlineusedvehiclemarketplaceshift.com told forbes the surge in used vehicle demand is causing bizarre bizarre behavior in the form of used car prices appreciating given the strong demand for consumers the tight supply situation it seems likely that used vehicle prices already at all time highs will continue to rise there's a silver lining for those looking to trade in their current vehicles vehicles demand such as pickup trucks crossovers suvs are bringing top dollar and uh the amount paid on a site right now is increasing 15 to 20 percent in some cases 30 percent over the last year for the same used car first time in history used cars have gone up in value well they haven't over a period of a year but that same exact vehicle all caused by the covet economic disruption yep uh people in factories not making cars that's right also i read about people not in factories making cars that's right well i also saw that be because travel was literally almost suspended that rental car companies are a big source of used cars as well because they'll order cars from manufacturers they'll rent them to folks like us and then after a certain point they'll sell them back and that becomes a part of the used car inventory as well so you have two things manufacturing as a whole also orders from uh carmel companies so it's really fascinating but i will tell you this i am in the market uh i can't even believe i'm saying this dave my oldest is going to be 16 in november so i'm already beginning to look just to see is there something right now that i could jump on and get it get a great deal put it in the garage and for him and so i've been looking a lot just a direct to consumer uh facebook marketplace is a great option there there's all kinds of auto trader and so outside the dealer i still see in fact i spent a good time this weekend a good amount of time looking there still are great deals if you're buying directly uh from someone else but to the dealers there's no question the prices are up i see that yeah and so the other thing that's happened was um i bought a used car last week and i bought it at market it didn't pay it was not up um took a little work though yeah and i actually looked at the new version of that car and uh there's such a shortage on it that dealers are charging 20 000 over sticker for that particular car and uh now it's an expensive car but they're adding a premium on it on a on a new car because they they gave me a quote on the new one and i'm like uh dude i buy it invoice and guys like not today you don't right and not right now you don't even sir across town the same brand is selling these for twenty thousand over sticker he said well i'll tell you a sticker and i went ah i think we're gonna go used so i bought a used car and so uh but it's uh uh man i mean it the this disruption and it's just like the new housing like the new housing market is screwed up and so it's screwing up the used housing market and then people go cray-cray and they get the chasing stuff and get the fever and it's like oh god oh god i'm not going to get what i want it's like a little kid on the cereal aisle having a hissy fit and then they over pay for stuff and so um yeah i used vehicles uh are there's a shortage and um definitely and there's a shortage for uh uh the new because there's a shortage on new because the factories were not dialed up and it's gonna take a little while for it to catch up so it's like it's gonna take a little while for lumber supply demand to catch up right now lumber's selling for more than gold it's unbelievable it's true and drywall i've talked to a builder friend of mine brought sheets of drywall yeah explode everything plywood the glue going into plywood there's a shortage on they're saying it's going to go up 4x before it comes back down but it'll come back down and these used cars will as well yeah so plenty but the good news is if you're out there and you like just decided i'm going to get out of debt and you're like i've got to get rid of this really stinking overpriced i bought too much car yeah you know i got a thirty thousand dollar car you know twenty eight thousand or oh thirty two thousand on it this is a great time it is it really is a great time to move down in car uh it's a great time to get rid of a car yeah that you that you're trapped in so that's the good news i'm curious to know what the trade-in value is how much it's gone up because traditionally that's way way lower than what you can get if you sell it yourself yeah you know the other parts of this article which i didn't read uh but the man mannheim is the largest wholesaler the auction houses that wholesale to the dealers and um they're seeing across the board about a 10 to a 15 bump wow and uh so that's that's and then of course that's of a used car going across the dealer auction dealer puts that back on his lot and um you know they're not in the business to lose money so they're gonna be marking it up that much so we're seeing this uh the the i i knew there were going to be shortages because of covid we talked about that at this time last year because these factories all just shut down and it took them forever to come back um and you knew there were going to be shortages but what i didn't for some reason i didn't i was dumb i should have been obvious i did not see the price increases as a result because it creates a shortage and drives prices up simple supply demand curve stuff and you know you get into that and uh but you're right the um the uh rental car companies hertz it owns dollar that sponsors the dollar car rental studio so we've had discussions with them i didn't realize until we were sponsoring them and we were actually talking to them at this time last year because no one's renting cars and so they're all screwed they're all going into bankruptcy they're all you know right on the teetering on the edge and what they did was they just sold off half of their inventory liquidated these used cars like crazy they dumped them on the market well now the market's gone the other way and now they can't get the new cars and so it's gone back the other way so they a lot of rental car companies have a shortage of inventory to rent to you oh we see that all the time it's not unusual very normal it really is interesting and hertz is the third largest car dealer in america massive yeah that's amazing well you know it's like you said dave it's like we had all this extra supply but we burned through it and now the factories are trying to catch back up so it's going to be this way for a while i created a new thing as you were talking either msrp now it's iiwii it is what it is you like that so don't buy a new car anyways we don't tell you to buy a new car unless you unless you've got it and then some but now it's the time to stay away yeah yeah just just here's the plan not right now yeah i don't need it that bad don't need it that bad this is the ramsay show [Music] stop paying your overpriced wireless provider and switch to puretalk they use the same network as the larger providers for much less for just 30 a month get unlimited talk text and six gigs of data with no contract the average family saves over seventy dollars a month by switching to pure top just go to puretalk.com and enter the promo code ramsey to save 50 off your first month pure talk simply smarter wireless ken coleman ramsey personality number one best-selling author of the book the proximity principle is my co-host today as we talk about your life and your money the phone number is triple eight eight two five five two two five joel is in dallas hi joel how are you dave i'm doing great sir uh good afternoon to you and ken i want to say thank you so much for what you guys do every day it's important to a lot of folks out here that are trying to better their lives and figure stuff out so thank you well thank you sir how can we help today so here's my question we're on baby step four and um we i've got a 401k question the company that i work for does a very generous uh match every year it's a profit sharing it's not actually a match and it can range between 10 and 15 of my total salary not sure what it's going to be every year it's not set in stone kind of fluctuates uh right now we are putting 15 into the 401k the traditional 401k every year good um and have been for the last three or four years so we're looking good but my question is this do i need to be according to the baby steps do i need to be putting that much in given what my company is also contributing and then second part is do i need to be looking at adding the 401k roth option in as well in addition to or separate well if you change your 401k will either be traditional or it will be roth and it's better for it to be roth and so i would change it to roth from this point forward now the matching portion that they give you cannot be roth it will be traditional by law okay uh the matching portion does not affect our baby step four baby step four is you put in 15 of your income if you get gravy on the biscuit extra gravy on the biscuit caught a match that's just that much more wealth you'll have but i don't depend on them at all the point of the baby steps is you are controlling your destiny and so you put in 15 if they match if you have a match you certainly take that match and so matches better than roth is better than traditional that's the order of attack the rock paper scissors so to speak and um so yeah switch it to a roth and you put in 15 which it sounds like you are and you just continue to do that uh can so the in the old days the um like when i first started this show 30 years ago uh still at that time a lot of companies had the traditional pension plans now 78 of companies have done away with pension plans they don't have them anymore and so it's pretty much a roth or a 401k or an ira you're gonna do your own thing and you're gonna do it through your company and uh the that's the bad news the good news is a lot of them match over 70 of the companies do match because they don't do the pensions anymore yeah why did they pull that was it did it come down to taxes for companies or is it too much to manage why the shift from i didn't know that number i wrote it down because that was that was really shocking to me that that that many companies aren't doing pension plans why would they do away with them well they're super expensive they're super regulated to manage their pain in the uh and because can you think about it i mean you have a team member that joins you at 40 at uh 60 they retire and you now manage this pension for them for the next 25 years yeah it's too much time and money and so it just becomes very cumbersome and with regulations on them they didn't perform they don't perform that well they're not allowed to invest the way that i would invest or the way i teach people to invest so they don't make it they don't make a good rate of return and so uh but it's bad for the individual because now you the only way you have money in your 401k is you have to put money in the 401k it's good for the individual though because the 401k is yours yep and the pension is not if the company goes broke it's an asset of theirs you could lose the you know the old story the mind the mind closed up papa lost his pension that's right you know and so because the the pension was not his it was an asset on the books of the mining company that went broke and so they lost it now that doesn't happen as much but with the regulations and the insurance and stuff we've got now but the union mismanaged the pension and frittered it away you know these are real stories that have happened to real people when it's a 401k the company goes broke it doesn't touch your 401k because it's not in their name it's in your name yeah you know accessing it with a broke company with the hr department closed down maybe a bit of a cumbersome thing but the money is still there it didn't leave and so you you are controlling your own destiny you're responsible for it and that's both a blessing and a curse that's right because look just like it is when everything that we're responsible for we have to actually step up and man up woman up and get her done miranda is with us in charleston west virginia hey miranda how are you great how are you doing better than i deserve how can we help so my husband and i were working on baby step two we're going to zell intense and we're trying to we're looking at our numbers trying to figure out how to get our payments to go down um we have a car it's a ford cmax of 2004 and kelley blue book has offered us 10 000 um we owe 21 000 on it and that loan right now has a 5.9 interest rate yeah so what is this car really worth is kelly blue look shooting you that low are you financing negative equity from the last deal into this one um no uh we owe 21 000 on it and they're offering us 10 000. i know what they're all i heard that part that's ridiculous so i'm guessing the car is worth 15 and they're trying to steal it from you probably um it's in pretty good condition it's 2004. it's a it's a hybrid did you finance negative equity were you in the hole when you wrote trade it in yes okay so some of this hole is from the other car okay so you need to do some more research and find out what the car is really worth because uh if a wholesaler kelly i didn't even know kelly blue will bought cars but if they do i'm sure they do and um if a host they're buying it at wholesale because they're going to resell it for a profit which means that you put it on the market we're just talking about that coming into the show you're going to put the thing on the market for full value so check kellybluebook.com not counting this and just look up of the value do an appraisal on the car you can go to edmunds.com as well i women's car guys and pull up and say private sale if i put the thing on facebook marketplace or neighborhood marketplace or whatever these things are that are out there and you know uh craigslist and people still do that and so on uh i don't know is craig dead he could be dead but um but anyway that that's uh um you know so along along those lines you you're gonna sell the thing trader i know trader.com you can use and i sell it direct like ken's out there looking for a car for his son he talked about that a minute ago and so yeah you're going to probably find that car's worth 13 15 something like that it's probably not worth 10. 10 sounds insanely yeah yeah i have to know the mileage on that but you can get a really good value on that very easily multiple sites and you could you could really hone in on the condition of the car and i think you get the most as you possibly can for that because right now as we said an opening segment people are your car is competing against the dealers who are selling used cars at a premium so if you sell it actually at market value you're going to be very competitive a lot more attractive than there's a shortage so yeah definitely definitely make sure you have your values right so miranda a good rule of thumb is this in a negotiation which selling a car is a negotiation buying a car negotiation he with the most information wins he with the most patience wins and he or she with the most options wins i don't need to sell i got lots of options i don't have to sell it i'm not desperate okay so you got walk away power you find out every detail about what every car like that at every site is selling for and you become a dad gum expert on the used car market around that particular car information he with the most information and then you just slow your butt down you don't get the fever people get emotionally like like they had people when they sell stuff they just they get emotionally like it's already gone in their minds and so now they have to give it away no no just just plan on keeping it a while and be a little hard to get along with when you're selling it you know come on now maximize this asset you need the money you're broke this is the ramsay show [Music] [Applause] [Music] so [Applause] [Music] we were drawn to christian healthcare ministries because we both had young families and we wanted to have more children and we had also just started a real estate company and needed to find health care coverage that would meet our needs we were attracted to chm because of its low monthly costs and the ability to negotiate medical costs down established in 1981 and accredited by the better business bureau chm is here to meet the needs of your growing family or small business check us out at chministries.org backslash budget we absolutely believe in it [Music] [Applause] [Music] ken coleman ramsey personality is my co-host today this is the ramsey show i'm dave ramsey mikel is with us in seattle hi michelle how are you i'm good how are you guys better than i deserve what's up well um i have a question that i i feel like is probably splitting here but i wanted to know what you would advise we currently have a 20-year fixed-rate mortgage and i'm wondering if we should finance down to a 15. not for that reason only if you get a better interest rate because if you take a 20 and you calculate what the 15 payment is and you just pay that much extra it'll pay off magically in 15. sure so you don't have to refinance to do that so what is the interest rate currently it's 375 and i talked to churchill and they said they could get it down to 275. okay what's your loan balance uh 235 okay so one percent saving is 2 350 bucks a year right mm-hmm and if it costs you five thousand dollars to refinance you get your money back in two years if it costs you seven thousand dollars refinance you get your money back in three years so you don't make any money until you get your money back okay so are you going to be in the house a while yeah for a long time we planned okay all right i probably would refinance it and while you're at it put it on a 15. but you don't need to re if let's say you had a two seven let's say you had a three percent 20-year mortgage i would tell you just sit on it and pay extra okay you don't need to go to the refinance cost to pay it off early you just pay extra and it'll pay off early but you refinance your refinance if you can save not sending them as much money as you used to do you know as you used to send them and so um you know there's gonna send them 2 350 less per year for the next many many years until you pay the thing off one percent savings per year yeah so i'm refinancing that if you're staying and while you're at it do it to a 15. charlie's in los angeles hi charlie welcome to the ramsey show hey dave thank you so much for taking my call really appreciate it what's up i am a small business owner out in california and it's been luckily a pretty rapidly growing company over the past six years and i'm dealing with an employee of mine who is my general manager i think has a bit of a spending addiction which is making me kind of wonder if i need to do all the ideas from a raise or if it's best just to let him go when that time comes um if i can give you a bit of a background on this gentleman he's in his mid-30s three kids works full-time for me 80 hours a week he's a great asset to the company and um he's in this management position for just over a year 80 hours a week um 40 hours a week my apologies oh i'm on the bike yeah sorry 40 hours a week okay um now the issue is that he left my company before when he was a warehouse packer he came back and he worked up to his management role but since then he has about a hundred and fifty thousand dollars i estimate conservatively in cars and like automotive toys um he kind of mentions and complains about money and stuff but not really in like a i'm expecting a raise type thing i try to give him raises organically without him asking toward good work what's he made he makes 45k a year okay and he just kind of casually in conversation asked me if he could start leaving earlier monday through friday to come in a bit on saturdays so that he could work a second job and just because he has left the company previously i just kind of wonder you know i'm not going to plan letting him go but if he does ultimately say that he wants to leave should i try to keep them around or focus on my younger staff who are who have their potential and don't have as much how many times how many team members do you have total right now we have 15. okay cool okay yeah the question i have for you charlie is forget the finance issues is this guy a great leader for you or at least a good leader with tremendous potential let's set aside just for a moment your concerns about his spending and him asking around about a raise is he a quality team member that you think uh if he's healthy you could develop him even further up so the thing about my small company is that it's all been a learning experience kind of for all of us he didn't really have any managerial experience but he's been doing a great job of learning but what i really value about him more than anything else is that he cares about my company treats it like it's his own and i feel like does genuinely want to see the company do well well i gotta tell you that right there to me is one of the greatest characteristics of somebody that they care deeply about your company and so he's he's unhealthy financially and i i would sit down with him and have a man-to-man but come at it not from a judgmental standpoint to say hey here's what's going on i don't have all the facts here's what i think i know help me fill in the blanks and here's why i'm bringing this up i care about you because you care about this company you've done a great job and you've learned and you've grown and you're mentioning some things here and there why do you need more money here's what a development plan might look like and here's how you'll keep getting raises and share a vision for him and see where he's at financially and see if you can help him and pour into him and and take care listen i'd get him financial peace i'd put him through it and coach him up if he's willing to do that show him how if he gets his spending habits under control how it will change his entire life you know i'd be willing to have that conversation if i were you because of what you just said about this guy i think he's worth investing in now i think you got to have a point where you get to where you say all right i've invested and i've coached and and and now it's up to him and if you feel like it's too big of a divide he's not going to get there and you feel like he can no longer be the employee that you need then you move on but i wouldn't try to anticipate him leaving i think that's managing leading out of fear versus being proactive so when we were doing entree leadership when we were doing ontario leadership a couple weeks ago out in dallas um pat lincione said there is no such thing as any kind of leadership except servant leadership and so if you're going to lead him then you need to care enough to serve him and how are you serving him uh you got to sit down and go dude forty five thousand dollar income hundred fifty thousand dollars in toys you're doing fouchy math here this doesn't work okay you can't this doesn't work you know you're not in congress you have to stop this for your sake you can't win doing this and i love you and so i'm just trying i'm just looking at you man-to-man friend a friend and going i'm gonna serve you well and so you know i've had and our leadership team have had conversations with people inside of our organization over the years uh almost on a weekly basis someone we sit down with and say listen i love you too much to just not tell you this you gotta you gotta know this is this right here is killing you this is hurting you and and so because here's the thing you're serving him then what you got to do is you got to go okay if he has a lack of judgment over there how long before that lack of judgment regardless of how much he cares enters into our organization if his critical thinking skills have got him this far in debt i mean he's going to start making stupid butt decisions at work too and so we got to get him off the stupid butt train and get him on the train where he can learn and that's just loving the guy well that's serving him um when i serve my children and they're growing up it means i teach them how to behave and function in society it doesn't mean the inmates run the asylum uh because i love my kids enough to serve i'm gonna serve you i'm gonna make sure you know how to drive a dadgum car before i give you the keys i'm going to make sure you know how to behave and say yes ma'am and yes sir and thank you and gratitude and you know all you know that kind of a thing and so you're serving someone by loving them well yeah and by having hard difficult conversations with them yeah you got to sit down in this situation you say hey you're looking for a second job that means more work hours a week more time away from your family and this is all because you're not showing discipline over here and when you show them you're teaching you're guiding you're instructing shoot them straight i'll pay for you to go i'll pay for your ramsey plus membership and you go you know you you uh that's what you tell him and you go i'll walk with you and i'll coach you and because i think you've got huge rock star potential as a leader yeah because of your passion for this place and i really want to pour into you and lift you up yeah and you can set a model in place then on how you lead people for the rest of your life there really cool question charlie you got a good heart man this is the ramsay show [Music] [Music] ken coleman ramsey personality is my co-host today open phones at [Music] 825-5225 matt is with us in springfield missouri hey matt welcome to the show how can we help hey dave thanks for taking my call sure um so um long story short here my wife and i bought a house in 2012 uh at about 160 000 and we spent the last eight years paying off our house and we just did that last year in july and now my wife's wanting to move again and because her office got closed down during the uh kovid pandemic and she ended up working remotely from home now permanently and so i'm having trouble coming to terms with wanting to possibly take on another mortgage and so i'm kind of needing some advice on how i should handle this uh um okay so your current home is worth what we bought the home for 160 in 2012 and right now it's probably worth about 280. okay and what's wrong with the house you have now uh nothing wrong with it she just one she doesn't like the layout and two there's no office space for her we're in a home like she works from the kitchen table and we have you know kids and everything and uh it gets noisy and she can't you know do client calls and stuff like that because it's too distracting okay so why couldn't you buy a 280 000 home with a different layout and that had an office well we've been looking and uh we haven't found anything in our area uh of that price and uh with the layout because you haven't looked in that neighborhood you've been looking in those expensive neighborhoods you could say that yeah no i'm sure of it i mean you know yeah that's the logo you're looking at the wrong neighborhood if you want to stay out of debt right well i i do want to stay out of debt i don't well why are you looking in the neighborhood that has debt uh that's a good question but uh the the area has just shot up so high that you know well then yours should have been shot up i mean a 280 000 home in springfield missouri's no slouch dude that's a that's a decent house and you could have a differently configured home that included a different layout and config included that for that same money and just swap houses yeah but what we're doing is we're using all this other bs as an excuse to move up in-house that's really what it comes down to yeah yeah i guess you could say that yeah i mean i want a different kitchen that's got like 70 000 more worth of crap in it and i'm using this i'm working at the kitchen table whining as my excuse to go into that again so where in the process did you all lose or did she lose the vision of being debt free on your home is worth it uh well i think it's just been over the course of since she's had to work from home the constant interruptions with kids being in the area and her trying to handle phone calls and get work done and um go renter an office yeah we've we've talked about that but we we do pay for a private school as well for our children and we haven't been able to justify the cost of getting a rental office or her her business did have her set up to go to a rental office's office spaces and then they got rid of that option what kind of work is she doing she's a hr consultant so she's on the phone eighty percent of the day yeah she's handling she does a compensation mail analysis uh executive analysis who's watching the kids when they're not in school like how many kids are running around we have two kids and it'll usually be me watching them but i i do shift work so i'll one week i'm working nights the next week i'm working evenings so i have a crazy work schedule i work weekends yeah well let me just tell you something by yourself let me say something dave's absolutely right you too this is a relationship thing you guys got to sit down and and re re-establish the why why did we do all this for eight years what was the whole purpose of this and you know this is a pretty easy solve number one you're living in a hundred sixty thousand dollar area so today's point the two days yeah i know well i'm saying that's what they were yeah that's what they bought at yeah and then so there's a couple neighborhoods up so i think it's unsafe it's not like schools are awful so i think this big bad world you're in the other thing is is that you know she can work at the coffee shop or something just you know and make phone calls and step out or do whatever i just i just think this idea that we got to move somewhere for her to have a place to work besides the kitchen table i i just think that's a relationship thing where you guys have to re-establish the why behind this and then say okay we're willing to do this but we're not willing to go beyond the 280. and if we can't get happy with something for 280 cash then uh you have to come up with another solve until you save up enough to be able to do something you want i mean what's your household income 175 a year go rent an office yeah okay today okay and then if you want to trade houses trade houses but that off listen the tail's wagging the dog here you're making a bad financial decision for a temporary situation right yeah working at the kitchen table is not the way it's gonna be for the next decade right she's not gonna be the kitchen table for a decade and you don't you don't go buy a house uh because of something that happened with covid uh these are you know i i do not know when she'll be back at work or when they'll be funding the office but you make plenty of money and so for you know what four or five hundred bucks you can go rent a single office in one of these office suites and just you know she can plan herself down there and then she's got a work environment that's reasonable and then if you want to trade houses for a better layout that's fine you could guys can do whatever you want you got a lot of excuses for a guy that called in wanting help not to do this and i'm just telling you don't do it there's no chance no chance that i'm going into that in this situation none this is all a bunch of i want it and i'm a little bit uncomfortable and i'm sorry you're uncomfortable i'm sorry she's uncomfortable whoopi don't put yourself back into a mortgage over that you finally got yourself free man remember what it was like having that thing hanging around your neck don't go back into the noose don't stick your head back in there man don't put your foot in a bear trap again them things hurt man don't do it don't do it please please don't do it and and you know but you you you know is there a valid part of this that she's trying to do business in an unprofessional situation yeah go around an office and do it tomorrow that's what i would do in your situation i'm not going into debt for an office in your home over now is literally these uh closets that are offices it's like a new thing uh you look it up online i'm not kidding you where people are turning closets into miniature offices geez we can at least do that no i'm not going in the closet not a chance she makes 175 000. i agree i'm trying to give him a non-rent option i just you know there's another place besides the kitchen table but i agree with you you can go get an office yeah yeah but here here's the thing it's a vis where there is no vision the people perish if you work really hard to get out of debt because you believe that your life is so much better being debt-free you have so much higher probability of building wealth by being debt-free you would never go back but you quit believing that somewhere along the line and we're willing to trade that for the inconvenience of the current situation and i'm not willing to trade it no the the the difference is that when we went broke and lost everything i said never again and i meant it never again are these bozos gonna have their thumb on my neck never again is american express gonna call my house unless it's a wrong number never again there's not a chance i am not going back there's not anything you people can do to scare me enough there's nothing you can do to make me mad enough there's not anything you can do to make me greedy enough passionate enough to go into debt the borrower is slave to the lender and i am free and i am never going back it's easy for me to say and and i can't imagine you and stacy having that conversation to be any different no yeah it's look every time that you allow your emotions to drive you then then you lose sight of decisions that you have made many you know what i mean and your critical thinking skills critical thinking is gone and i feel this i feel this i feel this and in this situation you made a great recommendation they can upgrade and still be mortgage-free yeah it's easy it's not a bad it's not like not enough enough enough that puts this hour of the ramsey show in the books [Music] have a friend or family member that needs a daily dose of ramsey advice in their life let them know about the ramsey call of the day podcast it's a quick hit of advice about life and money in under 10 minutes check out the ramsey call of the day podcast wherever you listen to podcasts [Music] this is the ramsay show [Music] you can be intentional about your character you can have money and a career you are the hero in your story [Music] live from the headquarters of ramsey solutions broadcasting from the dollar car rental studios it's the ramsey show where debt is dumb cash is king and the paid off home mortgage has taken the place of the bmw as the status symbol of choice i'm dave ramsey your host ken coleman ramsey personality is my co-host today thank you for joining us open phones at triple eight eight two five five two two five that's triple eight eight two five five two two five anders in washington d.c hey andrew how are you good dave how are you better than i deserve what's up so uh we've been working the plan for three years um we paid off just under a hundred thousand dollars in debt and then the next two years spent uh saving up and obviously doing the emergency fund and we did the 3b we saved almost 200 000 we put down money on the house then we have our emergency fund in place great so we're looking to kind of do the four five and six perfect um now the 15 got that that's great we start investing in retirement and now the question i have is the 529 should i do that or a separate broker's account that's not a traditional 529 specifically with our income and then we don't know if our kids are or are not going to go to college okay well uh uh what is your household income so right now it's a little over 200 but kind of projected to go up okay well to start with no one knows that their kind of kids are going to go to college but we're for sure know that if they don't have the money it's going to be harder so a 529 grows tax-free i love keeping the government's hands off the growth it can be transferred to a sibling it can be transferred to a parent another family member it can be transferred if they don't use it if they got scholarships they can you can pull from a 529 the equivalent amount of the scholarship with no taxes tax-free growth and so yeah i'm doing a 529. i'm not going to over fund it if you have concerns i'm not going to put 200 000 in there but but i'm definitely going to put 40 or 50 60 grand in there and depend on the age of the kid and maybe even more but uh uh and let it grow you know a brokerage account infers that you're buying and selling stocks and you don't need to be doing that especially for your kids college so i don't want that much risk i just use good growth stock mutual funds and a tax-free growth in a 529 and and you choose the mutual funds and you choose to move them around that's the type of 529 you want we're very specific about that in our in financial peace university and in the total money makeover but yeah just you know you don't have to overdo it but uh don't under do it either and overthink it about whether your kid's going to college or not interesting so when we start the show 30 years ago the assumption was everybody wanted their kid to go to college and now they don't yeah and increasingly becoming the case but also point out here that these 529 plans that money can be used for non-traditional college education as well so trade schools that's anything from tech schools i mean you can use that and and so you're seeing more and more opportunities for people to get qualified to do the work they want to do so it's not like you're you're being unwise but you can use it for their private school when they're one k through 12. you can that's exactly right so it's still the best option yeah and keeping the government's hands off the taxes and not screwing around with the money with single stock trades acting like you and your buddy eating a biscuit at cracker barrel have a clue what's going on don't do it don't do it man and just get in there in some mutual funds those guys are on the mutual fund they're coming coming to work in a car longer than your house they know what's going on so it's it's not perfect but uh that's where all of my kids college money was so i'm not being hypocritical uh and so yeah i'm doing a 529. you can use private school while they're uh k-12 you can do any kind of post-secondary education there's all kinds of stuff you can use it for legally and it keeps the government's hands off of it and so you know if you put twenty thousand dollars in there and it grows to eighty or a hundred that's eighty thousand dollars with no taxes on it i like that i like that a lot better than screwing around with it in a brokerage account that's right and a lot of options tons of options uh gustavo is with us in tucson i mispronounced that how do you pronounce your name sir i did say it you nailed it well i didn't mess it up hillbilly spanish is just a hard thing dude i'm just saying so what's up man uh well i kind of had like a weird question that i'm on baby step i'm finishing up baby step three next month just to give you a heads up of where i'm at and um i want to get a toy i had one when i was in debt but i want to make sure it's kind of weird because my vehicles aren't worth too much and the toy that i'm looking into which is the rzr razor run they run about 15 000 news and that's more than my vehicles combined but i'm we're kind of happy with our vehicle so that's where my question is kind of is it weird that my toy would be more expensive than my vehicles even though we would be in a position to buy it cash yes all right i mean it's which it's weird you know it's weird that's why you're asking right you already knew it's weird but it's cool they're neat they're neat vehicles man you talk about that the um is it the can-am make that who makes that the razer does uh polaris polaris makes it yeah that's right yeah yeah i've got some friends down at cabo that have have them and they all ride up the beach at cabo those those things are very cool they look they look neat too man and they will haul butt they they're fun yes so uh yeah and you're you're in tucson so you're doing like desert desert action with the thing huh right yeah i mean i could make it all the way to phoenix i'm sure yeah i bet you could yeah it's they're they're very cool it's a cool vehicle i i kind of want i kind of want one myself but um anyway the yeah uh your cars are uh your your daily driver transportation your family depends on those your income is dependent upon those um and so yeah the uh uh you know a a snowmobile a sea doo a boat uh a razor should not be worth more than your cars uh it's just kind of a common sense thing it's not really a financial thing uh so right all it says is that you're probably not quite there yet that would be my opinion and of course you made the mistake of asking so i'll give you my opinion but the um yeah that's i i mean you've got you got a toy in your house i do but it was a gift to you on that it was and as you know i'm cash flowing the renovation of it yeah he has a classic car yeah got a 72 convertible karma gea uh found an old guy uh in the hood that loves working on him and so he's gonna help me put the carpet kit in and just do a little bit at a time because we have kids in school and and other things and and so you just have to go at the speed of cash like you said when we built this place and so i got the exterior done still a little bit more to do and it still looks pretty sweet it looks sweet but yeah you have to kind of what's the ratio on that i mean understand what he's saying he's like well i got baby step three now he needs to get the baby step four actually put that in the budget then he needs to begin to save for something like that yeah and you you know i i and i don't know that i have a rule and i'm just kind of sitting here thinking on the fly but right really you're if you're if your boat is eighty thousand dollars and your cars are ten thousand dollars that just seems to seem right you know and so if your razor's fifteen thousand and your cars are five thousand that seems backwards yeah you know and it but those razors are very cool they're very yeah i think he may have talked you into buying wise i don't need one right i don't know why but i'm probably just because it has a motor and it goes because it's fast it goes wood and wooden there you go man so i've probably got a loud muffler i can make a redneck muffler on it oh sure you redneck anything up you know that there you go [Music] what makes our show unique is that we genuinely care about our listeners we're intentional about choosing the best advertisers to recommend blinds.com is no exception they offer high quality window treatments at unbelievable prices and they make it simple to shop blinds shades and interior shutters with easy online ordering free shipping and a guaranteed perfect fit go to blinds.com and take advantage of this week's special savings [Music] [Music] ken coleman ramsey personality is my co-host today open phones a triple eight eight two five five two two five if you're tired of feeling stuck with your money like you'll never get out of debt or save enough it doesn't have to be that way you can get a ramsey plus membership that includes the ever dollar budgeting app the world's best budgeting app it includes financial peace university where you can go through the class learn step by step how to get out of debt like millions literally of people have done when you budget you get intentional with your money you get a clear path you start working it you're gonna make progress you're gonna make it fast you can start budgeting you can start making these steps free starting today with a free trial of ramsey plus text trial to 33 789 text trial two three three seven eight nine ld is with us in indianapolis hi l.d welcome to the ramsey show i did listen to you for a long time uh my wife and i are getting ready to have a first baby hey when's he coming anytime you know all right good for you yeah yeah pretty excited uh we got some pretty told goals for the future and so we'd like to we're trying to grow our income as much as possible trying to decide if now would be a good time for her to maybe advance her career and become a dental hygienist she's an assistant right now but it put about 10 to 12 dollars an hour on her pay caveat to that would be we one of our goals is for her to be able to stay at home and be a bigger part of our business within the next 10 12 years or so and so just trying to decide if it's if it's justifiable i guess interesting so what would she do in the business if she stayed home with the baby and babies potentially and worked in the business what would she be doing uh uh full-time i'm a farmer and uh so you know she she's uh she's also a pretty good bookkeeper and things like that and so okay uh my mom take my mom takes care of a lot of that right now but you know in the future okay so so she saves you money by doing the bookkeeping that you're paying someone else to do or she's replacing mom she would probably be you know doing a lot of what my mom does okay so you have to weigh all right she wants to be home uh sounds like that's what both of you want versus she now continues to work and there's the cost of the schooling the cost of getting qualified to become that dental hygienist and you're looking at ten to twelve 12 an hour so you start weighing opportunity cost with the emotional costs and i think that if it's stacey and i we're going to sit down together in the old-fashioned grandpa and grandma conversation the pros and cons of both of those so which way does her heart lead the most which if things were just has she wanted them forget about the money equation and making more money and all the benefits that come with that what does her heart want to do oh she she definitely wants to be able to stay at home at some point all right so why are you back and forth on this where were you at the start of this phone call uh like i said we're we just we've got some some things we'd like to accomplish and her her incomes it helps helps with getting there what does she make she makes about 30 right now okay so that this would put her at about 40. uh hygienists are in our area are in that 50s yeah 50s 50s okay i mean okay and so um what does hygienist school cost uh well we live in the middle of nowhere and so it's about thirty thousand but it'd be a pretty good a lot of travel time involved with that too with a new baby two and a half years right it takes two and a half years yeah so we have time and money here right right yeah this is more than just working for uh working uh with the baby at home this is uh two and a half years of training in it and by by the way during that time she's not working right it'd be pretty tough it'd be pretty tough on her yeah yeah yeah so it's costing you 30 a year in income and it's costing you 30 000 over two and a half years and she's traveling and gone so that after two and a half years she works for six years making twenty thousand dollars more i mean you're gonna she's gonna make money on this transaction but it doesn't sound like it's worth it yeah yeah that's been our back and forth yeah it sounds like by the time i mean if she was going to do it for the rest of her life and make an extra 20 000 a year and loved it and it was the long-term goal that might then the equation starts to work mathematically yeah but right now you're not going to get enough of her increased income before she's willing or before she's able to come home i think you start figuring out what she could do from home to create an income while she's helping you with the farm stuff and they're with the babies i think maybe we look at shifting that i bet you she could come up with a side gig like a christy wright business boutique idea um i mean if it's just selling stuff on ebay i don't care what it is yeah and then it may be streamlining operations on the farm remember we're saving money that's more money in our pockets certainly to a farmer you know the thing that point out here uh is ld is that her heart is not in it if i heard on there that her heart she wanted to be a dental hygienist what she's always wanted to do she loves it loves it loves it but she also wants to be a mom for a season then i think this is an investment and a sacrifice that you figure out how to do but i'm going to tell you with that kind of schedule the schooling you're losing your income as it is that's going to create all types of sacrifices and a squeeze and and when you don't have the drive the juice for something i'm going to tell you it makes it really really difficult and it can put you behind emotionally not just financially daniel's in columbia south carolina hi daniel welcome to the ramsay show hello dave thanks for taking my call sure what's up all right so um i'm in baby step six um i'm 27 and my wife is 25. um basically my mom reached out to me um asking for help um she had a lease a and if you want to pay it off on basically it ended up um the lease ends up this month um and she asked me to to borrow uh for me to to 2k and basically um she asked me not to tell my wife and obviously you know we are we have jones account and also um what's your question yeah what what's your advice in my situation i don't do anything that i can't tell my wife anything ever if i'm in a meeting and they say all the discussion in this meeting has to stay in this room you can't tell your wife i get up and leave the meeting there are no things on this planet that i can't tell sharon that is against the law at ramsey world it will get your throat cut by your wife while you're asleep dude you can't be hiding crap from your wife hello is that right yeah yes i'm sorry i mean your mom is out of control where's your dad are they divorced yeah no they're they are together they have separate accounts and actually my dad let him lend her uh 10k to pay off he lent his own wife money yes that's strange okay so uh mom i can't do anything that i love you but i can't do anything that i can't tell my wife and don't ever suggest that again because it's not gonna it's not a profitable conversation for us to have okay mom can't do that and if you need uh two thousand dollars you need to talk to your husband my dad and you guys need to work on your finances and get them get them combined and get them straightened out but i i think your mom i think your mom is trying to hide all of this from everybody and still trying to find a way to snake her way through this and it's time that the cards are played faze up on the table mom is getting ready to be exposed and needs to be you know needs to be so she needs to talk to your dad and she and your dad have got a lot of work to do but you don't need to get involved in this son you just lovingly say no i don't hide things from my wife and i really think you need to talk to dad about this he's got the money and you guys have the money and you all need to fix this so sorry can't do it love you mom love you mom no chance [Music] [Music] [Music] ken coleman ramsey personality is my co-host today on the phones in minneapolis is going to be kristin who says on my screen kristen you're debt free congratulations thank you hi guys hey how much have you paid off 61 091 and love it how long did this take 48 months good for you and your range of income during that time okay i went back and checked and it was 32 000 to 51 000 and now back down to about 40. wow so what do you do for a living i'm an accountant and recently a ramsey master financial coach ah okay so starting to get some extra income that way yeah very good good for you so what kind of debt was the 61 000 so a lot of it was medical just kind of stuff that surgeries children being born and then just like once we would accumulate it it would just hang around and payments payments payments there was some personal loans and a big family loan that we had to do repairs on our home okay wow good for you so how much was the big family lounge that was was like 22 000. that was the big one of the whole bunch that was the big guy hiding in the closet yeah gotcha okay so what happened four years ago that put you on this journey so my marriage was coming to an end and that's when we separated our money and i had always wanted to be debt free and become an edm so that was like pedal to the metal so fresh start after the divorce yep and um you already knew about our stuff but you were just now able to do it because of the the disagreement in the household before yeah it was like uh you know putting on a lot of throttle and the car is in neutral now now i actually got some traction okay good for you all right so you're going to be an everyday millionaire that's your future i love that yeah and what do you tell people when you're coaching them now that the key to getting out of debt is because you paid off 61 000 in four years making 32. yeah for me there was three three things and i would say the reason which is my voice the plan obviously and then just the determination so we just saw a picture of the four boys right yep on youtube there good looking family yeah thanks that's fun you got a lot of why there yeah wow for sure so i i want to ask you when you decide as you're coming out of this divorce so that's a painful thing and you decide all right i'm going to restart reboot do it the way that i always wanted to do it you've got those boys as your why every day looking at them uh what what fired you up the most in this process was it the first one the first the debt that you paid off on the debt snowball was it just the boys what was the real driver for you once you got into the process where you begin to experience some momentum i think i had a lot of little loans so getting started and getting those paid off there was a lot of immediate you know payoff for those and i just knew what i wanted to give them i didn't i didn't want a house full of stress and i wanted to give them a good future not like just giving them money but showing them what to do and they they hold me accountable i got a debit card mail to me and i open it up and they're like mom is that a credit card [Laughter] they're always watching me that's great that's so fun very cool so they know the rules then they know what you have to do oh yeah yeah very very fun cool so um how long had you been familiar with our stuff before your marriage ended uh quite a while um i think my folks introduced me to your radio show and back in like 2010 and then um i coordinated an fpu starting in 2011 and then i did another one before my last son was born so i've done a couple of those and i was just kind of hooked because i'm a natural saver and so once kind of the shackles were off and we found a better church that i wanted to be at and i started tithing again and i think dave you had said like a month ago when you talked about god throwing open the window of heaven he sure did in my case because it's like once you know we were pushing the bike down the hill everything just kept piling on i swear i have food show up in my freezer that wasn't there i had a expedition that i think two of the pictures are like a time lapse that i got when my son was seven months old the oldest one and he's 12 now and i've still got it it's just about 300 000 miles on it but stuff just kept being a benefit there was just kind of blessings from everywhere wow can i ask you what did you do to take go from 32 to 51k what happened um i my regular job was not 40 hours so i had a base of that and then i did a lot of side accounting work and then just try to get and i got a couple more clients and stuff like that and then i worked for my mom who's a cpa and i did tax work at night and just kind of everywhere i could pull from yeah that's great very good you're a hustler yeah you're getting her done girl proud of you very very well done good job who are your biggest cheerleaders other than your boys um i would say my parents because they've been down that road and they've been debt free for a while i have a lot of friends i don't have a lot of naysayer friends i got a lot of friends who are debt free or are on their way and then yeah these these kids i can't say enough about them because they never complained they knew what the plan was they volunteered i don't need a treat we can save it so i'm just really proud of what they have learned and how they keep me accountable very cool very cool powerful kristen what are the boys names so aiden is 12. gavin is nine mason is seven and morgan is four so we're going to try to coordinate it they're coming in here they're going to do the screen all right they've earned it no question about it very cool what a great family project we're proud of you great job we've got a copy of the legacy journey which is the next uh chapter in your story as you said you're going to be an edm an everyday millionaire you are on your way kiddo and uh and of course another copy of the total money makeover which you'll be able to give to someone and pay it forward and get somebody else's journey started with that best-selling book so good stuff all right kristen and the gang 61 000 paid off in 48 months making 32 000 extra side hustles up to 51 part of that time count it down let's hear a debt free scream all right ready boy three two one i love that sound yes that is the sound of a family tree being changed right there you heard it yes those boys lived that with her yeah what a legacy single mom uh leading modeling the way i i just you know i'm always blown away by the stories of everybody we get to hear their debt-free journey but certainly uh you know anthony o'neal and i got to host a show last week or a single mom uh making thirty two thousand dollars same thing same thing and i i have a special place in my heart for those ladies yeah step up and do that we all do it's hard enough to parent certainly by yourself and then and then go through that debt-free journey i want to point out something dave that i thought was so heartwarming you asked her who were her biggest cheerleaders and she said beyond her parents were friends she said they weren't naysayers they had been on the journey themselves and i just want to point that out that when you decide to live like no one else you better hang out with people that are that are on board and will support you you become who you hang around with birds of a feather you read what they read that's true you talk like they talk you um you know you attend church like they attend church you treat your spouse like they treat their spouse i mean this is this is you become who you hang around with so choose carefully my friends choose carefully this is the ramsay show [Music] [Music] carol is with us in sacramento hi carol welcome to the ramsey show hi dave how are you better than i deserve how can ken and i help okay i have a question i'm actually a ranty coach and also an everyday millionaire we have three homes that are paid for and we are also a co-owner with one of our children due to due to a divorce um our question is this if we sell one of the rental homes we could net about 560 000 which is almost enough to pay off the kids homes and surprise them we don't quite have enough we're about 60 k short of paying off both of the homes should we do that or should we keep the house or should we sell it and put the money in mutual funds i'm confused you said kids homes two homes we have yes two homes and to adult children okay and we're we're co-owners on one of the homes okay but you would pay it off and surrender that ownership yes okay because you're only a co-owner because you had to bail them out in a divorce yes and then my our other kid has his own home and um okay so you sell the rental and it brings 560 000 but you need 620 000 to do this exactly and you don't have the other cash we kind of do i just don't know if it's smart to pull that out of it because we would we have other funds it's not a retirement fund i just don't know if it's smart to do right now um we're getting eaten alive and capital gains are paying about 200 000 in capital gains so what is your net worth probably about 3 million okay i would do it but i would only do it if you pull out enough out of your other investments in order to actually do it if you don't actually pay off the mortgages it kind of defeats the purpose doesn't it yeah kind of because from what i understand in california you can only gift so much money per year so we may not be able to do the whole thing all in one uh you i don't know california law but in this in the u the federal taxes there you have a gift tax limitation that this is well in excess of but you can use some of your federal estate tax exemption called a unified estate tax credit and you just have to do it you have to unified as state tax credit and you're using some of your federal exemption up so when you die you would have used some of it up already but you're nowhere near the limits anyway it's like 20 million so you're fine that's what you would do to get rid of the federal gift tax i do not know california tax law at all so you'd want to you want to consult a tax professional to figure that out i suspect that that unified estate tax credit would also apply in california i i bet you it's aligned with the federal guidelines this is my guess i'll be shocked if it's not um but california does some weird butt stuff to tax our people so i don't know um but anyway yeah so uh your net worth now becomes two and a half and they have paid for houses the only other question i've got is would they commit to never borrowing money again for anything yes yeah i wouldn't make it a big deal but i probably would have like a little one-page letter in both of them and their spouses sign it if we pay off your home you never borrow money again and so our family tree is completely changed never borrow money again for anything for any reason yeah ever and by the way you shouldn't have to if you don't have a house payment you'll be able to save up and buy anything you want to buy yeah yeah that's and just you know we we bring in a nice income off of the rent we don't have to have it so that's kind of my dilemma too i'm just like sorry how old are you guys we're in our 60s yeah i would do it yes really yeah okay and pull the other 60k out of yes i would not do it unless you're going to pay them off i mean there's no point in paying it down that doesn't do anything you still have student mortgage so but get rid of the the debt and have them both sign a little one-page letter um just type it up and just talk about legacy and how you want to change your family tree and everybody participates i think that's a fair trade and then after that you just don't bring it up and you can't go managing their finances anymore this is their life you don't get to interfere this is a gift but it's pr the gift is predicated on the fact that we're changing our family tree and that is a fair level of control in return for the gift yeah let me ask you on that are you saying in the letter that they are committing the they're just asking the kids to commit to that they're not going to be checking up on them that's what you're getting at correct there's no strings attached but it kind of is well it's a it's a promise yeah i like that it's just a promise i promise in return for having my mortgage paid off to never borrow money again yeah i think that's fair that's a family oath so to speak but it's not a it's not a legal commitment and no you're not gonna check up on them once a year and look at their balance sheets and no you're not doing any of that it's just like you know if they go and buy a house and put it on a mortgage in the future you would just look at them and say you broke your promise you know that's it that's all it is and then you just go well that's sad you broke your promise because you shouldn't have had to yeah if you're because the kids are going to be millionaires pretty quick oh yeah no question about it they'll be there very very quickly depending if they're if they are you know learning from their parents model uh to not borrow and to be generous and to be investors they'll get there very very quickly open phones at triple eight eight two five five two two five matthews in phoenix hi matthew how are you doing well dave yourself better than i deserve how can we help uh i have a question about refinancing we owe about a 131 on the house with about seven years left of payments after refinancing about eight years ago and my wife is going to be losing uh going on to full disability probably within the next six months to a year and unable to work which will be cutting our income in half to have money for medical expenses would it be smart to refinance to lower the house payment to cover medical expenses in the future what do you make uh currently uh 45 from my work and then with the veteran disability i collect another 24 000 so about 65 a year nine yeah and the house payment's about 15.50 okay um what does she make uh currently about 60 to 70 so after she's what is the nature what is the nature of her disability it's a terminal illness that's slowly debilitating her where she has chronic fatigue and unable to stay awake or work oh my how old is she uh mid-40s and i'm in my mid-30s wow i'm sorry man uh that's a battle we've been going through but still staying strong and trying to follow your way as best as possible to prepare for the upcoming future of her health issues seven years is so fast you're going to be done i hate to have you walk away from that but i would not trade quality of life if we've got a terminal diagnosis for anything so um yeah i probably would con i probably would consider just because i don't only want you to have the wiggle room to make sure you got medical bills and stuff covered i think you can cover the house payment i think you could cut it out and make it but it might mean that you don't get to do some things with her that you need to do while she can exactly so it was the out of being debt-free because we only owe 131 on the house and you're almost there in seven years oh i hate to have you lose that but yeah if you put that on a 15 it will relax that payment considerable and uh you can circle back later and maybe still make it in seven years or eight years or something you never know exactly where this journey is going to take you but um yeah i mean you you need to concentrate on her okay just wanted to hear from you because i know always snowball forward and we've been doing really good the last seven years after taking your course i would love to see you finish it up but not if it means that you lose some experiences with the time you have with her that's not a that's not a good trade i i wouldn't but either way is okay but i just wow heartbreaking i'm sorry this is the ramsay show [Music] hey guys this is james senior producer for the ramsay show did you know over 18 million people listen to the ramsay show every week and a lot of those people listen on one of our 600 plus radio stations across the country to find a station near you head to thermsyshow.com [Music] this is the ramsay show [Music] you can be intentional about your character you can have money and a career you are the hero in your story [Music] live from the headquarters of ramsey solutions broadcasting from the dollar car rental studios it's the ramsey show where debt is dumb cash is king and the paid off home mortgage has taken the place of the bmw as the status symbol of choice i'm dave ramsey your host ken coleman ramsey personality is my co-host today he is the host of the ken coleman show which is where you learn all about your career all about jobs all about how to get them out about how to find the work you love and so if you have questions about career and work he's here to help and we're here to help you in general so jump in at triple eight eight two five five two two five that's triple eight eight two five five two two five canal is with us canal is in columbus ohio hi canal what's up hi how you doing better than i deserve how can we help i had a quick question about self-banking with whole term life insurance and whether it's worth it if you accrue a cash balance and borrow against that and pay interest to yourself or if you should stay away from that and keep using a bank yeah um it's an absolute scam it's a whole life policy it's not a turn it's not a term policy it's a whole life life insurance policy basically whole life life insurance is where you pay 20 times more for the same amount of insurance and so the extra 95 dollars out of the hundred dollars goes into a savings account and um that you earn very little on after you finally start to build it up and then one of the ways they're pitching it now is the self-banking concept where you use your own money which by the way when you have a checking account you are using your own money i don't know why they think that's magical okay perfect i guess i won't use that no i i wouldn't use it i would stay completely away from the company that is offering it and any other offerings that they have because it is a really really bad product and it is a scummy way to sell whole life life insurance which is a scummy product to start with but no one sells that stuff anymore except people no one believes in it or talks about it positively except people that are in that business and this whole thing of you can borrow your own money why would i want to borrow my it doesn't even make any sense dave but this is the power of marketing i mean the message here is really look into stuff i love that people can call and get advice on this but really dig into stuff and and and does it make sense and if it doesn't make sense why doesn't it make sense but they put some wonderful marketing copy on this yeah so make money from yourself give you another one it just keeps yeah isn't that great and you pay and you pay them interest right to borrow money from to borrow your money that you saved up in your savings you're moving money from your checking account to put it over there to them to not even get a good return on it to get it back it's just it's mind-numbing it's like moving a pile of rocks from one side of the yard to the other back and forth back and forth back and forth but and so here's the other one uh whole life life insurance you can uh you can use it cash value insurance grows tax-free well no it doesn't that's a lie but here's how they propose that you do this you overpay for your insurance by 20 times for all of your life your whole life that's where it comes from they take your money your whole life and finally you have some money in there let's just say you've got fifty thousand dollars in there now if the 50 000 is in excess of what you paid in and you take it out that is taxable because there's a game right yes but not if you borrow it and so you put money into this investment now you can borrow your money that you put in there back out and pay them interest but it's tax-free yeah well no kidding doofus when you go to the bank and borrow 50 000 they don't charge you taxes on it it's a debt yeah of course it's not taxable debt is not taxable but it's not a tax-free growth on an investment like a roth ira or roth 401k right it's not even on the same planet yeah it's the same kind of stuff that he's dealing with there and it's this whole idea of but but boy i mean you talk about i mean they're they're almost as scummy as the timeshare people yeah they're almost that scummy yeah they're almost as scummy as the payday lenders they're right up there that's straight up manipulation what you just laid out for us as clear as you could lay it out that's manipulating people lying yeah we could call it live dave ramsey is giving bad advice because with whole life you could get tax-free growth no you can't yeah no you can borrow your own money and pay them interest right and borrowed money is always tax-free because it's borrowed right it's not an actual investment so yeah that's how that works but but i'm the crook and i'm the one that doesn't know what he's talking about according to that industry now if you want some people pissed off at you that's a good group of people to have pissed off at you the time share people are pissed off at me yeah the car fleecing people are pissed off at me the payday lenders hate my guts and the whole life people oh my god you would think i would have you taken on the rent to own furniture people yet you know they just don't do much anymore right okay i'm just trying to think of anybody else while we're we should just go ahead and get a full list of the scum people you don't get christmas cards from yeah yeah well i mean rent to own is actually you know i have they are taking on in a couple of our books and a couple of our courses over here yeah but i don't really hear from them much yeah it's not a popular model yeah the nothing down same as cash furniture people they're not happy with me no best buy screwing people with that stuff for decades yeah it's ain't the best buy people yeah you know it's not hard to figure out yeah the product protection plan people they don't like either yeah yeah all the extras why is it that everybody makes you the bad guy because you're trying to save people money well i'm just trying to save people that's the point yeah you're hurting the big corporate scams and so that's why they come at you yeah like everybody didn't already know payday lenders were a screw job like like all of america knows time everybody knows a time share is like the worst thing on the planet yeah and like they're shocked that dave ramsey said it out loud the time shares are scummy yeah oh my god of course we said it out loud they were scummy long before i back when i had a hair they were scary yeah well when you offer all these free things just for a meeting which by the way i did it one time you didn't i did you went in the tiger cage yeah because the package was so nice and they see the tiger for an hour and you get a free pass to the zoo for a year so stacey tiger hasn't eaten in four days but come in the cage and pet the tiger for an hour oh here's the deal i didn't pay attention to my wife this is a great story yeah she's like you're gonna have to sit there and listen i'm like trust me i won't i'm the guy that goes through this there's no chance well i went in just mr stonewall not gonna do it like you're the only one's ever done that i know and then sat there and just got worn out i tried to be rude i tried to get kicked out i'll give the guy credit he made me sit there for 90 minutes but i'll tell you what i got all the stuff too so that was it it was the last time i was in it it was not worth it it's our first year of marriage buy your own hotel room yes buy your own hotel room it ain't worth it no don't pet the tiger in the tiger cage yeah it's good he will eat your butt yeah you'll come out of there with a 26 thousand dollar time share that's worth a dollar yeah you can't sell it for a dollar on ebay you can't get out of it no you is stuck baby you've been petting a tiger don't go in the tiger cage no wonder he hadn't eaten in three days there's nothing as greedy as a timeshare salesman oh my god this is the ramsey show [Music] hey folks i got a great option to help you pay for your education the army national guard the army national guard believes you are the next greatest generation because you have proven that even in adversity that you have what it takes to succeed that's why they offer benefits like tuition assistance career training and a paycheck to help you avoid debt no matter what your goals are the army national guard can help you get there visit nationalguard.com to find out more [Music] [Applause] [Music] if you're a business owner or leader listen up financial wellness benefits are no longer quote unquote optional for your employee benefits package yeah financial wellness is a thing the research team here at ramsey solutions recently put out a report that found that half of all employers say their employees are stressed about money yet only 18 percent feel responsible for their employees financial well-being well that doesn't make sense your employees bring their money stress through the front door with them because they come to work with it every day it's hurting your business with turnover missed work lost productivity delayed retirements you got to fix this team to get our team's report on what's happening in the workplace with financial wellness and learn what the employees are actually facing you can add financial wellness to your benefits package and will help your business text wellness to 33789 wellness to 33789 our question of the day comes from blinds.com they have a 100 satisfaction guarantee that means even if you mismeasure you pick the wrong color they'll remake your blinds for free you get free samples free shipping and with the new promos they run every month you'll save even more use the promo code ramsey to get the best possible deal today's question comes from jennifer in texas she writes in i'm 48 and i've been in an industry for 20 years that i'm not passionate about i've done well but i'm burned out and feel trapped i would love to go into nursing am i crazy to quit my job to go into a career where i'll make less than one-third of the income if i stick it out for two to three years we could pay off our house and i could just quit completely but i'm not ready to retire is the financial and emotional roi from nursing school worth going back to school or should i stick it out well let's first address the fact that you can work full-time while in nursing school is it very very difficult yes but you can do it you can certainly work part-time in healthcare even where you can get some experience and more importantly connections for nursing when you get out of school so i when you know the reality that you can still work that you can cash flow your way through nursing school here's what you can realize you might be able to pay off the house in two to three years while you're cash flowing your way through nursing school and if it's really about love i would love to go into nursing so if you really love the idea of caring for people in that nursing profession you can make really good money be very very fulfilled for another 10 you know years 10 12 years based on your age so is it worth it you have to answer that but i would say it's worth it if you can cash flow your way through and not go into debt because you've worked so hard to get to a point where you're going to pay off the house so sticking it out for two or three years in a job you can't stand i don't think you need to do that i would make preparations to part-time nursery school or if you can go full time and make some other sacrifices i think you go for it i completely agree completely agree and if the you know her last question is the financial and emotional roi from nursing home school worth going back to school yes without question you'll love your work and you'll make good money yes and you can pay off the house yeah yeah and uh i don't think you have to stay in the job i agree for two to three years and i love the part-time idea so absolutely so yeah the thing is this you know but make sure that you love nursing not you love the idea of it and i and not you love um the money you could make that's correct so here's how you know that for those of you who are looking at this question in a different field or maybe even nursing how do you do that so what she does is she gets around other nurses this is phone calls zooms coffees lunches and by the way there's tons of different types of nursing uh er labor delivery checking people in at surgery there's a lot of different nursing positions and by talking to you know as many nurses as you can in all those different positions here's what happens i get head knowledge they tell me what it's like day in day out what it's like to move into that position how you advance you learn everything and then what happens is your brain processes that information dave your heart eventually goes ding ding ding or and that's why it's so important to really know what it is then your heart will confirm and now you're ready to go don't just assume you're going to love it joe's in louisville kentucky hi joe welcome to the ramsey show hey dave thanks for taking my call sure what's up well my fiance and i she's not a u.s citizen but she's lived here for about eight years we plan to go back to europe or move back to europe for a year to two years while we do the application process for her permanent residency and i'm curious if you think i should sell my house or not uh yeah yeah i would it's a great time to sell a house okay and then if i do sell my house what should i do with that extra money i think i would have somewhere between eighty and a hundred thousand dollars you don't have any debt we would we have no debt uh which are our finances are completely separated now sure um but we're um but we have no debt neither one of us other than the mortgage and um her family has a place for us to stay for the time we're there so we would be living rent free we both work remotely okay so your incomes won't change correct that's cool what do you all make i make about a hundred thousand i'm self-employed to engineering and she is in marketing and makes around 50. excellent cool when are you getting married um well that's that's a a big question we haven't planned all that it'll probably be sometime in 2022 okay all right um yeah i i i i think i would as far as where you park it if you're going to park it for one year probably just a money market account you're not going to make any money but you're not going to lose any money if you're going to park it for two years or more you may want to consider putting part of that into some mutual funds something like a uh an index fund an s p 500 fund or something like that i do some of that but now i understand that that money goes up and down and you could lose a few thousand or you could make a few thousand doing that um sure you know you're not gonna lose 80 000 doing that but you might lose uh eight you know uh or something like that so that you gotta if you want to play that a little bit you could that's a medium risk way to take a chance of you know instead of making eight dollars you might make eight thousand dollars but you're not gonna you're not gonna get rich on any of this well it's just sitting there as you're just parking it until you're married and come back home and so forth so uh obviously this citizenship thing changes when you're married right yes and the process is delayed due to covid there's a big waiting list so that's she hasn't seen her family in quite a while so that's why we're choosing to do that in europe we could do that here but we kind of have to stay put can't be in and out of the border while that process has taken place oh really that's interesting as far as we know yeah okay i don't i don't know how it works honestly i'm completely ignorant of that i just know that when you're you marry an american citizen it changes the process uh substantially uh and so you know i i would guess that the sooner the marriage happened the sooner the citizenship would happen in other words but i think i would want to know about that uh i heard that advice and i'm just sitting there going what would i do in that situation and because of the medium risk factor i'd probably park it in the money market but i because that me going i i know that it's going to sit there it's not going to gain much at all but i know it's there we're going to keep making money keep adding to that so then when we come back yeah but i mean but there is a benefit i mean the money you could make i guess to me it felt like too risky for me yeah for the bulk of the time i've been on the air i would have just said money market right for that reason just don't worry about it yeah and because uh but you know in the last decade or so i've parked a lot of money short-term mm-hmm yeah you know and a time or two it's been down i pulled out because i was going to go buy some real estate with it it was down and i had lost a little bit my timer most the time though it was up and i made a lot yeah uh during the time it sat there uh and so what i started realizing was the risk wasn't that heavy it's not that big it's not huge i mean eight thousand dollars isn't gonna change his life that's to make 150 000 between them yeah you know so if you want to play with it that's fine but if it's emotionally going to keep you up at night then certainly do the money market yeah this is the ramsey show [Music] foreign [Music] in the lobby of ramsey solutions on the debt free stage jc is with us hey jc how are you i'm great how are you dave better than i deserve welcome good to have you and where do you live indianapolis indiana wow welcome to nashville and all the way down here to do a debt-free scream that is right love it how much have you paid off i have paid off nineteen thousand dollars oh wait 19 188 dollars good how long did this take um it took 14 months wow and your range of income during that time i started out at about 24 and bumped it up to a little over 36 000. good for you what do you do for a living monday through thursday i am a dental assistant and then i have been a dog groomer for the last seven years so i do that on the weekends that's your side hustle then okay very cool what kind of debt was the 19 000 it was a endless cycle of credit cards and then my student loan and my car how much did you owe on the student loan in the car 3 500 on the student loan and my car was 9 000. okay all right and that i paid to my parents ah that was a debt to my parents so it's good to get rid of that too yeah that was a big deal yeah i hear you i hear you so what happened 14 months ago lit you on fire girl you got after it yeah um well i was working for a um grooming salon and they had unexpectedly just closed the shop like so they told us they were done and they were filing bankruptcy and we were out of a job whoa so i was like man i have a lot of debt like start of the year i had a lot of debt i had lost my job and so i uh just decided to that it was time to figure something else out i didn't really want to work for anyone else in that like grooming so i started up my own thing that was but you were already working the dental yeah at that time okay so you had that job all along but that that side job ended yeah and that woke you up yeah cause i i really wasn't making too much money at the dentist job like i can make a bunch of money just grooming so that was where i really made a lot of my money okay all right wow good for you well congratulations and how did you get connected to us my parents have listened to you guys for a while and i they mentioned some things um about you and uh they've always said you know i'm really not been one to be super responsible with money more of a free spirit um so i wanted to kind of prove to them that i could really stick to something and and you know get it done and especially when it came to my finances so they knew that i had been in credit card debt for a long time and i just it would come the start of the year my tax return would come and it'd all go to my credit card debt so i was done doing that so what did you do you started listening to youtube or watching youtube podcasts on spotify broadcast every day to and from work every day okay got real serious about it and that gave you everything you needed to do this it sure did yeah so you didn't have the books or anything from your paper no but i did end up going to the bookstore and i found one of your older books the total money makeover and i started reading that um and then i decided to sign up for the fpu class oh okay and i was like man 100 should i spend that like it could go to my debt i'm like ramsay said just do it so i did the fpu class and it was definitely worth it it was a little difficult because it was online during covid yeah so i did the best i could with my three-year-old running around so but but it was still fine and worth it i mean i stuck to it good for you i'm proud of you i bet your mom and dad are they sure are they really are they were cheering you along yeah it was it was a big deal for christmas instead of getting a bunch of presents i saved up two thousand dollars and gave it to them to put towards my car wow and uh that meant a lot to them they really were not expecting it at all and so to see them you know hear them talking about how proud of me they were and you know just the hug from my dad and the pat on my back and you know it just it got me fired up to finish paying off the rest so that's cool yeah wow very cool you jumped from 24 000 to 36 and i'm guessing here is that some overtime but also a lot of dog grooming all dog a lot of weekends yes without the little man i mean i miss him a lot the hardest part was being away from him that much i mean it was monday through thursday full time at the dentist job and then thursday night into sunday i was grooming like every single weekend what kept you going he did that's beautiful right there my three-year-old that's beautiful yep and i have the greatest accountability partner which is the doctor i work for tony um every day and he knew how much this meant to me um every day he'd come in and we would be talking about the weekend how many dogs you have to groom this weekend how busy you going to be how much money you're going to make and it just was like you got to stick to it you know a lot of my time went to that and now i can say it's worth it now you're free yeah how's it feel i can breathe that's that's how it feels i can breathe finally how old are you 26. 26 years old and you've never been debt-free as an adult have you no no it was almost like having a credit card was a competition how much did you get approved for you know my credit limit's 4 000. what's yours that was like my 21 year old mindset yeah yeah so got you in trouble wow yeah you have to feel uh one lady said accomplished i mean this was a not just a 19 000 debt paid off you changed i did i've changed so much through this whole experience i mean i really thank you so much for this i i don't know how to say it but it's just it's been so eye-opening like i can raise him without having to worry you know all my monies go into my debt and not to what i could be doing more for him you know i've got his savings fund for his college started i've got my retirement fund going thanks to thanks to tony you know he he's really helped me out too he's it's awesome coached you alone oh yeah that is just so cool well well done well done jc and your young man's name and age you want to get him in the shot for the debt free scream his name is cyprus and he is three you want to come up here come up with mom while we do your debt-free scream she's worked her tail end off she's a hero she's changed her whole life man i'm so proud of you so powerful so well done good stuff all right it's jc and cyprus from indianapolis man nineteen thousand dollars paid off in 14 months making 24 to 36. uh we are looking at some people who have changed their lives i'm so proud of you got a copy of the uh legacy journey for you that's the next chapter for you to become wealthy now unbelievably and you are on your way i'm so proud of you and a copy of the total money makeover so you can give it away to somebody awesome so we'll give you one of each you ready all right jc and cypress count it down let's hear a debt-free scream three two one i'm debt free [Music] [Applause] oh man that nineteen thousand dollars when you're making 24 to 36. it's getting with it that's that's more than some doc calling in here paying off 190 grand yeah i mean that's incredible yeah what she pulled off there was absolutely incredible yeah and she is i mean the and the difference in weight on her after that the actual math the the freedom in her math now is just it's just amazing she is in really really good shape and you can see what you guys can't see in the radio you can hear hints of it in her voice but what you can see is on her face yeah her countenance yeah you can see the sense of uh uh she's a young warrior yeah another single mom behind the eight ball and yet she said enough and she did it that's getting with it folks 19 000 14 months with a heavy heart upped her eyeballs and dog fur she did it she did it well that's exactly how that is yeah there's a great place to go when you're broke no work that's right i love it this is the ramsay show [Music] [Music] our scripture today ii corinthians 9 8 and god is able to bless you abundantly so then all things at all times having all that you need you will abound in every good work winston churchill said the pessimist sees difficulty in every opportunity the optimist sees opportunity in every difficulty my fico score is zero i don't have a fico score it's undeterminable that's what they call it sounds kind of evil but yeah i'm undeterminable so how do i survive how do i make it i pay for things and if i don't pay for them i don't buy them now i know that's weird but it's a it's a it's a freeing concept keeps you out of debt you can teach your children to be counter cultural in a culture that has lost its mind and we've just dropped prices up to 80 on our best-selling kids products so you can have fun and have an educational summer the adventure pack is a family favorite that includes the new story time collection financial piece junior the smart saver bank and more to make learning about money actually fun the best part is you can add an extra kit for each sibling or if you've got a teen the teen entrepreneur toolbox by anthony o'neill is the perfect safe and flexible way for them to create their own summer job teach kids the right way to handle money while they're young that way they won't live in their bait your basement when they're 30. save up to 80 percent off by shopping the kids and teens sale online at ramseysolutions.com store ramsey solutions dot com slash store tina is with us in phoenix hi tina welcome to the ramsay show hi dave hi ken how are you guys doing great how can we help yes so i talked to ken last week and i wanted to thank you ken for your advice well that's awesome what would you do so i i was not getting a recommendation from my boss and your advice was to flood the potential employers in box with references that could speak of my character and so with it being a long weekend i did that today and after a couple of years came through they said they would like to speak with me and it as long as everything goes through tomorrow i'm going to meet with the teachers and that goes smoothly then i will have a job and they said they were very understanding of that sometimes relationships just don't match and but they're willing to give me a chance oh i remember this so tina i want to tell dave what happened so tina had great references from previous teaching positions but had a personality conflict with the principal at the school that she just left she was worried that because they wanted to hire this new school wanted to hire but that one uh leader wouldn't give her a recommendation and so i told her well do you have a lot of other relationships in the school system that can vouch for how great you are and that this was kind of an outline circumstances so she went and did it and uh looks like she's gonna get that opportunity so good for you teen a way to not quit you did that you're the one that went out there and believed that you had a reputation uh worth uh sharing and uh that's really awesome very cool tina yeah i thank you guys for the advice i really appreciate it so i just wanted to say thanks it worked yeah thank you you did it you went out and fought for it fight for things folks yeah but you know what you told her she could and exactly what to do and she just executed she went and did it yeah and you know sometimes we tell people what to do and they go home and don't do it you know that's right like too often um and then they call us two years later i should have done it but then then other times that's that's why we come down here it's people like her that's exactly right you say go do this and you'll start winning and she goes does that and then she starts winning that's pretty cool it's fun got the job got the job the ken coleman job technique there it is i love it that is absolutely fabulous amy is in sacramento hi amy welcome to the ramsey show hi thank you so much for having me on sure what's up um all right so i started a business last year while i was laid off um and then i got called back to work right as i was about to start looking for clients i'm really eager to quit at least by april of 2022 and focus on my business full-time it's a bookkeeping business if i didn't mention that and um we already have six months worth of an emergency fund saved up we plan on having an additional twelve thousand dollars by next april the thing is my husband has a job where he gets laid off quite often he's in a labor union um so we would only be able to last about five and a half months on that extra 12k if my husband were to get laid off otherwise how long how often is he laid off for five and a half months i mean he was like in the last two years he was laid off once for six months um other than that i would say usually like maybe three four months on average man this job sucks yeah i'd be getting out of the union it does suck but we're waiting until he gets his journeyman card because then you can quit and you can take that anywhere you can work for the city or something like that yeah we're in it for the long game unfortunately yeah okay so how long before he gets the tournament card um so i think it'll be probably another like three or four years wow you're tolerating a lot of crap for that you know so every time he gets laid off he doesn't get hours um but anyways so if he gets laid off we could last on on that extra 12 000 for about five and a half months um otherwise we'd have to dig into the six-month emergency fund or i'd have to get a job again um what do you think about that am i crazy for wanting to quit when i'm gonna what is i mean you're assuming your business makes nothing i mean i don't i just don't want to estimate that i mean is your business not made any money all right i mean right now i have two monthly clients i'm netting aside from like cleanup work that's one-time projects um i'm only netting like 300 a month obviously you don't have a business yet you got a glorified hobby right well the reason why i want to quit and go full time is because i'm still like learning the business and i want to focus my attention a hundred percent no wrong way you got to flip that you got to keep doing these side side jobs like this let's get that up to 900 a month and then let's get it to 1500 a month and let's see how many hours we can actually give to it and really really hustle and grow your credibility based on your experience but you don't go all in until you get experience 100 a month yeah you get experience then you build it up okay so what if i were to take a part-time with a full-time job no your part-time job is learning this side hustle and growing this side hustle that's correct no this listen you cannot justify giving up your whole career and giving up everything and walking into something that's 300 freaking dollars a month you have got to prove this i mean not right now i know it's right now so prove me wrong go make some dadgum money you do whatever you want to do kiddo but i'm telling you that's dumb don't do that yeah okay yeah let's incrementally let's get let's go from two clients to three or four clients or let's let's drop the two clients replace them with with more work from clients that'll give you more work we want to get your billable as a bookkeeper this is all about your billable time what you have is a theory right now yeah you need to move it from theory to business yeah a business is something that makes money ongoing that is substantial that you can live on you need to grow a business and as the business gets up close to what you're making now then you quit your full time but you will have proven your ability to make money doing this you have to do that and you've got this dream in your head that if you just go full time it's all going to work out honey it's not how it works because you haven't figured out how to run this dadgum business yet you haven't figured out how to make money with it and you got to go make some money that's the whole goal here everybody's willing to do what it takes very few are willing to wait as long as it takes and that's where you are the tension for you right now is you don't want to wait because you really love this bookkeeping and you get this day job you want to get rid of here's the problem you're not ready your day job's going to fund the dream job go build the side business yep build it get the dock get the boat closer to the dock don't be jumping in the water thinking you're hitting the boat the boat's way out there still yeah you need to get it up closer so you can land in the boat when you jump please please do that that puts this hour of the ramsay show in the books we'll be back with you before you know it in the meantime remember there's ultimately only one way to financial peace and that's to walk daily with the prince of peace christ jesus [Music] hey it's kelly associate producer for the ramsay show this episode is over but if you heard about an event product or service and didn't have a chance to write it down don't worry we list everything you've heard about during this episode in the podcast show notes section or head to thermzyshow.com thanks for listening [Music] you

Channel: The Ramsey Show - Full Episodes

Views: 36,718

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Keywords: dave ramsay live, dave ramsey, dave ramsey channel, dave ramsey live, dave ramsey live show, dave ramsey live stream, dave ramsey podcast, dave ramsey radio show, dave ramsey show, dave ramsey show full show, dave ramsey show live, ramsey, ramsey solutions, the dave ramsey show, the dave ramsey show live

Id: kMRmOZUUz4c

Length: 121min 45sec (7305 seconds)

Published: Tue Jun 01 2021