Live from the headquarters of Ramsey Solutions, it's the Ramsey show, where we help people do work that they love, build wealth and create actual amazing relationships. Doctor John Deloney. Ramsey personality number one bestselling author and host of the ever popular doctor John Deloney show is my co host today. Open phones at 888-25-5225 you jump in, we'll talk about your life and your money. Spencer is in Memphis to start this hour. Hey, Spencer, what's up?

Hey.

I am calling because I have gotten myself into quite a bit of debt over the past about five years, and it's come down to I'm debating if declaring bankruptcy would be one of my options. I want to avoid it at all cost, but I don't know what else to do at this point.

Pretty scary, dude. You married?

Not anymore.

How long you been split?

About three and a half years now.

Money play a part in that?

It did.

I'm sorry, how old are you?

I am 24.

Wow. So how much debt have you got?

It started about four years ago and I got 20. It's about $23,000 worth right now.

23,000 in debt on what?

I had two vehicles and then I got a $3,000 personal loan, two credit card, three credit cards. They were only like $500 a piece. And then I had a military star credit card as well that went into collections.

So how much of the 23,000 is the credit cards?

Maybe 1500 bucks. Maybe a thousand.

Okay. How much do you currently own two cars?

I do not. And that's the problem. I lost just about everything during the divorce, but I ended up keeping the credit or the debt for it.

So wait a minute, she's driving both of the cars?

No, it's kind of a long story. Long story short, whenever I went through the divorce, she took one of the vehicles and she had it for about two years. Refused to sign divorce papers. I couldn't file the car as stolen because she was my wife. She would never pay on it, so I ended up not paying for it at all. They couldn't repossess it because I didn't know where it was. And then. So that was one car.

Where is that car today?

It finally got repossessed, but now I still owe 9000.

Okay, so you have a repo of nine k. All right, where's the other car?

The other one? As I got it, I never turned in the title to it, to the bank, so I ended up, I believe it turned into a personal loan or a vehicle loan with no collateral. That one was for 6000.

Where is that car?

Technically I do have the A car to show for that. I have a 2008 Yukon and a.

So it didn't have a lien on it and you sold it and bought a Yukon.

Correct.

Okay. And what's your Yukon worth?

Maybe five grand. I get five grand for it.

Okay. And it doesn't have a lien on it?

No, it does not. I have the title.

Okay. And what do you make?

I make, I just got a new job making 58 a year.

Okay. All right. You're not bankrupt. You're scared and you're hurting.

Correct.

But you're mathematically not bankrupt. Hear me?

No, sir.

I've been doing this a long time. You just don't know what to do next. That's all.

Correct.

Okay. You're. You're hurting because all this stuff was out of your control. The divorce broke your heart and you've just kind of swept stuff under the rug and now you got a really lumpy rug.

Exactly.

Yeah. And this stuff has a high rate of resurrection. It comes back to life. Zombie money problems. They don't die. They just keep coming out of the grave. And they're uglier every time they come out until you shoot them. Okay. Now, so here's the thing. If you file chapter seven bankruptcy, you can clear every bit of this and you'll keep your Yukon under current law in the state of Tennessee and you live in Memphis. Okay. So that is possible. I would not recommend it though. You can settle repo debt for somewhere around $15 to $0.20 on the dollar. And a lot of your debt is repo debt. So if we're looking at $20,000.04 or five grand will clear that with some negotiation and some fight. Okay. But you got to call them up like the 9000. They'll probably take 1000, 1500 bucks, maybe 2000 and clear that on the ex wife's car that you never really figured out. Whatever, all that stuff. Right, right. Okay. So if you call those people, it's not nine grand, it's two grand. Cause that's about what you can satellite for. Cause they're just gonna be so happy somebody called because they can't find nobody in this story.

They're everybody. Even the freaking car disappeared in this story. Right. So. Yeah. And so if you don't pay anyone and file bankruptcy, you could do the same thing and just not pay anyone and not file. Then the only thing that could happen is they could come and sue you. Okay, but none of them have. Yeah, none of them have yet.

Yes. Not yet. Correct. I have a court hearing in July for. It's. I got a set of rims and tires after I got out of the military, and I honestly never paid on it.

Okay, so here's the thing. Can I be mean to you for just a second? In the middle of all your pain?

I need to hear it.

You got to quit buying crap that you don't have money for. Period. Period. And. Okay, like, I mean, rims and tires sounds like a 16 year old.

Absolutely.

Okay. But that's kind of what you are when you're coming out of the military for the first. Yeah, absolutely. So, yeah, I mean, so let's throw. Let's throw our shoulders back and start acting like we're 30 or 40 with our maturity level on our decisions, rather than a wounded 24 year old guy who's had the snot beat out of him. Okay?

Absolutely.

And I think you can do that and we'll help you. So what I'm going to do is I'm going to assign a Ramsey counselor to you for free. And they're going to walk you through, step by step, how to clear every one of these debts. It's going to take you about, yeah, maybe a year to clear them all and to negotiate. And you're going to have to be tough and you're going to have to quit buying crap. Okay. Can you do those two things if I help you?

Absolutely.

Okay. So what I'm saying is 23,000, we can probably get all that cleared for somewhere in the neighborhood of ten or twelve, and you make 50. You can do that in a year, but you're gonna scratch and argue with these people a little bit and get it done.

Absolutely.

Yeah. And so if you file bankruptcy when you could have cleared it for $12,000, that'd be just silly.

I would agree with that 100%. That's why I needed somebody to tell me.

All right, so you're a good man, Spencer. You just been hurting.

Does that give you, does that give you peace, Spencer? They give you some grit.

That helped a lot. It did. Because I felt like I was on the edge of the walk board for quite a while now.

She beat you up pretty good.

Yeah.

It wasn't nice.

Is there a little one involved, too?

Not, not with at the time. I do have one now, yes.

Okay. Oh, you're 24 right now?

Correct.

All right. When you get done with here, I want you to write 30 year old Spencer a letter about the man you are going to be when you're 30. No more kids unless you're married. No more borrowing money. No more buying stupid things so you can look cool to 18 year olds. I want you to write 30 year old Spencer a letter and I want you to live into that. Got it?

I can do that.

Cool, man. Hey, I was 28 when I filed bankruptcy. I'm 63 now and I'm a multimillionaire. You're going to be okay, son. Hold on. We'll pick up and get you dialed in. This is ThE Ramsey show, so here's a quick math refresher. There are only 24 hours in a day, so your business needs to streamline tasks that are time suckers and focus on activities that make money. So to reduce headaches as they scale, smart businesses use Netsuite by Oracle, the number one cloud financial system. Netsuite helps you improve efficiency by bringing all your major business processes into one platform. So join the more than 37,000 smart businesses like Ramsey solutions that have done the math and graduated to Netsuite. And right now, you can download Netsuite's KPI checklist absolutely free@netsuite.com. Ramsey. That's netsuite.com ramsey. Open phones at 888-25-5225 you jump in. We'll talk about your life and your money. Doctor John Deloney is my co host today. John, I love the suggestion, as we're going on the break with the young guy to write him his future self a letter, I kind of almost feel like we all ought to do that. Like there's just a, there's something about what do you want to be when you grow up?

You know kind of thing. Yeah, who do you want to be?

I just keep going back to that conversation that was such a before and after that I had with my wife when she asked, like, what do you want this house to feel like when you walk in from work? And I was like, well, I want it to feel warm and I want to feel, I want us to be laughing when I walk in, not both of us be so tense. And then that started a conversation. Well, then here's what's got to be different. And I just wonder, what do I want it to feel like when I'm 40? What I want to feel like when I'm 60? What I want my relationship with my kids to be like? And what do I have to do right now to live into that that's so different than, let's just get to the next day and the next day and the next day and you wake up and you're 100 miles from your original destination. I just love that idea of sitting down and being intentional. Where do I want to be, man?

Yeah, because you just don't.

Or more important, who do I want to be?

You don't accidentally become good things. No, you accidentally become bad things.

And life happens, and I get really mad and I start to spin and make a decision.

I don't ever.

You've never done this. But I find myself way over here, and it's just I like the idea of 55 year old John going, whoa.

Whoa, whoa, whoa, whoa, whoa.

Like, letting him.

Yeah.

Be a little bit of a guide for me, right?

Yep, absolutely. Open phones at triple 8825-5225 Aaron is in North Carolina. Hi, Aaron. How are you?

I'm doing great, Dave. Thank you, and John so much for taking my call.

Sure. What's up?

So my wife and I just bought a house, and I'm feeling a little buyer's remorse, and I just wanted to get y'all's take on our financial situation to see if there's some validity in what I'm feeling or if it's just, you know, I'm just in my head on it. I'll give you just a rough kind of breakdown of our financial.

Before you do that, tell me what the house payment is.

3700.

Okay. And what's your take home pay in the house?

180 a year. Roughly 9500 to 10,000 per month.

Uh, no, it's not. Something's wrong. I'm talking about take home after taxes. 180 is not 10,000. 10,120. You don't have $60,000 worth of taxes on 180. You don't?

Well, no. Okay, so are you taking that four hundred, one k and all that?

No, I'm not. Taxes only.

Oh. Oh, taxes only. I don't know the number.

Yeah, so it's probably. Okay, so how much are you putting into your 401k?

Currently I'm 10%. 10% and my wife is 10%.

Okay. All right, so that's 18,000. So that makes sense then. All right. Because your take home pay, not counting your 401k, would be more like 14. Okay. Something like that. And 401k, health insurance, whatever else the crap's coming out of there. Because something's coming out of there. But that's what it ought to, because 180 is 15 a month.

Okay.

So you'd be at 13. And 3700 is not out of line then. That's my point. I had to get to real take home pay for a soldier house. And now we don't have to sell your house. So that's good.

So my wife will enjoy that.

So you're the saver and she's the spender. You're the nerd, and she's the free spirit.

Yes.

And you feel like you can't, you feel like you caved and bought something you can't afford.

Well, we're good on the house. The only debt that we have in our names is a car. And my biggest stress right now is do I just, I have 85,000 in the bank. The car. I have 39 on my car.

Write a check and pay it off today.

Okay. I was going to go sell it and buy beater. I just didn't know if it was.

Smart to just, well, you could still sell it later and buy beter if you want to, but for today, let's get rid of the stress.

Okay? All right.

And you guys are not doing a written monthly budget called every dollar on the everydollar app, where both of you agree on every dollar before the month begins, where it's going and what its name is. And if you'll start doing that, you'll feel much more in control.

Okay?

It'll give you a lot of, it'll give you a lot of peace. It may cause some fights because it may expose what some people in the house are spending, and it's not you.

Yeah, you're correct. And we do, we did do the every dollar app, and we're able to save around 2200 a month. But for some reason, that just seemed low. And I got on Reddit, which I shouldn't have done. Everybody was like, oh, your house core. And I just started freaking out.

Listen, Reddit is not, Reddit is not a source of anything except trouble.

No, Reddit is for, if you're feeling exceptionally well and you're like, you know what I need in my life? Little depression, then you should read Reddit.

Other than that, if you get a medical diagnosis, if you go to Reddit, you're dead by morning.

The only thing that will kill you faster is Webmd. They'll kill you. They'll kill you within the hour.

So seriously, you're right. So, Daniel, Daniel, what you guys need to do is you need to get above this and think about your source of information. And we are making fun of Reddit, but it's not a good source. Okay? And cause the numbers you're giving me, nothing's out of control. I think what I'm hearing is a good guy who's a nerd who's very responsible, like me. I'm a nerd. And your wife has not let up on the spending. You all are not in agreement. You've been kind of, you know, swinging at this whole money thing instead of actually making it dance, getting it in line and making every dollar dance, and both of you being in agreement, paying off the cost. And then I think you're going to have a lot of peace. The numbers you're giving me are not stupid. If they were, you know I'd tell you.

Yes, sir.

Aaron, can I ask you a few other peripheral questions?

Yes, sir.

You got any friends?

Oh, yeah.

That you go hang out with once a week?

Yes.

What's the state of your health?

What's the state of my health?

Yeah. You exercise, you go for walks every day?

Oh, yeah? Yeah. Work out six days a week.

Okay.

Eat clean.

What's the state of your marriage?

Great. Really good. Really good. I think my biggest. I just want to be a good dad. I want to be a good husband. I want to lead my family to wealth. And I didn't come from that, so I just strive for that.

Okay. There it is. There it is. Yeah. You don't want to screw this up, so you're walking a tightrope. I get that.

Good man.

Good for you.

That's a good motivation. As long as it doesn't take it so far. You can't sleep at night.

That's right. I'm going to send you build a Reddit. Yeah, yeah, exactly. I'm going to send you building an un Anxious life. I want you and your wife to go through that book together.

Yeah. And then you guys jump on every dollar they app and get it going, too. And make sure, make sure you get this stuff dialed in because I think you're there. I think if you get 100% alignment with her using the budgeting process called every dollar that's going to. And you're probably 85 right now. Okay. If you get 100% control and command over the dollars and you're probably 90% on that. Okay. And you pay off the car, then you're gonna. And you start doing the Ramsey stuff the rest of the way and quit isshing it, then I think you're gonna find an immense flip from the. I think that little bit of lack of alignment and then this tremendous drive to be a good guy is where your disconnect is, your dissonance. Yeah. And.

Yeah. His body put a gps pin in money worries. And so it's just he's got a new big debt and he's got a kid and it's in his body sounding all the alarms, it's going back to those ratios. And you and I have talked about that offline. Those are just important things. I'm doing it right. We're safe. I'm doing good. I'm doubling up on my payments when I can, I'm taking overtime when I can. I'm getting this stuff done. And you slowly practice that.

Yeah, but when you do something that your inner voice, the Holy Spirit, is telling you not to do, and then don't be shocked that you're stressed.

Right, exactly.

So when you buy a house while you have a $39,000 car debt and you knew you shouldn't, don't be shocked that. That it's upsetting.

Right. Or one step further. If your parents were screaming at each other growing up over their house payment, even if you put 50% down and you buy a house, expect your body to feel a little tense, that's okay. I know that I have to outsource that. Cause when I get emotional, I get real emotional and I get real. I start making decisions fast, and I get a friend or two, or I get somebody that I trust to say, okay, I'm about to do something uncharacteristic. I'm about to sell my house we just bought. Is this wise? And then you can get some exhale in your life, and they'll go, no, I got your six. You're doing good. It's helpful. It's what this show is, right?

When you do things that are inconsistent with you, what you believe that people in John's world call that dissonance, there's a disconnect. Your actions are perpendicular to your belief. 100% time you get stress.

This show is sponsored by better help. Hey, it's doctor John Deloney, and one of the most common questions I get is how to get something off your chest, a deep secret you've never told anyone or maybe something that happened to you, something you've done that you're worried about, because bringing it to light will disrupt your life. Anything. I say this all the time. Secrets will kill you. But its hard to know where to start when it comes to talking about scary, dark things. Therapy can be a safe, effective place to get things off your chest, to learn how to say hard things out loud and figure out how to work through whatever is weighing you down. Ive personally been blessed to have a great therapist who helps me get those heavy things off my chest. If youre thinking of starting therapy, give better help a try. Its flexible because its online so you can suit it to fit your schedule, just fill out a short questionnaire. You get matched with a licensed therapist, and you can switch therapists at any time for no extra cost. Its time to get it off your chest with betterhelp.

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Doctor John Deloney Ramsey personality is my co host today. Well, John, it's finally happened. My 35 year stellar career has been reduced to selling t shirts.

Finally, we get some Ramsey. Cool gear, dude.

I thought. I thought I was an important author. And now I sell t shirts. So we have better than I deserve t shirts. Finally, we have food at home is the t shirt. That's a great t shirt.

I got that one.

That one says, better than I deserve. And some cool sweatshirts say debt free. I guess I should hold them up for you YouTube people. Yeah, because YouTube people need debt free. There it is right there. Okay, so model it, Dave. Model. Come on. Do your vanna white, Dave. Come on, buddy. And I'm drinking out of my own. Better than I deserve yeti. Because God knows I didn't have enough yetis, so I needed like. They breed like rabbits.

They are.

They breed everywhere. And then we got our version of the Stanley cup thing over here. Whatever that is, is that they live.

Like no one else.

Yeah, but it's the. What do they call. What are the women call that thing?

Stanley.

It is Stanley.

Yeah, that's the brand.

Stanley Cup. I was like a hockey for a minute, but, yeah, my brother in law.

Works on the railroad, and he's had a Stanley for 117 years. And his daughters were like, dad, we want Stanley. And he goes like this. And they all went, oh, he does.

He's got the real green one.

Dad's way.

The real ones.

Dad's got it going on.

Made by Aladdin, I think it was. Yeah. So anyway, you've been asking for the Ramsey merch shirts, tumblers, hats, better than I deserve. Hat. Yep. T shirts, yetis. Yep. You got them. We got food at home. I can't believe that one's popular. But you're wearing that one, you said, huh?

Yeah. I like that one. Cracks me up.

Yeah. Okay, so you've got a story the world needs to hear. You can kick off some conversations. I'm not crazy. I'm just getting out of debt. And, uh, it's kind of fun. And these, it's high quality. You know, the new soft kind of t shirts. Yeah. That all feel like pajamas now.

Yeah.

Everything's you know, those scratchy cotton t shirts are kind of gone. These softy ones are. Yeah, well, it's. Yeah, it's. It's. It's fun. I'm glad we're doing it.

Listening to you sell clothes is one of the funniest, most awkward moments of my professional.

I'm just saying. It was. I'm going, you know. Yeah. Ramsey solutions changed my life. I bought a hat from them. Oh, yeah. That just.

I will work so hard to get an underwear endorsement from somebody just so you have to pitch it.

Not a chance. It's amazing. Just so you have to pitch it. All right. Ramsaysolutions.com store. Check out all the new merch.

It's awesome.

It is actually high quality merch. I hope we're charging a lot for it, because it's just embarrassing that we're doing it. So anyway, fantastic.

Hey, for years, people have been showing up with their homemade. They make their own.

That's true. That's true. That's. Yeah. That's not on me, though. No, this is on me. Nah, this is good on my watch right here.

Well, it allows people to be a. We say it all the time. Like, we don't. We don't do big $400 million sponsorships.

Like a walking billboard for us.

They are, like, they don't have to say anything. If you get a little social awkwardness.

Just be drinking out of your. Better than I deserve. Yeti.

That's right.

Coffee.

Debt free. Because who at the mall doesn't want to know what your net worth is? It's important to just announce it.

I see. Put some sweet tea in the yeti and go for a walk. There we go. Yeah.

That's what's in your sweet tea.

For sure. Yeah. All right. Daniel's in Detroit. Hey, Daniel. What's up?

Hello. A lot of debt.

How can we help, sir?

Well, I'm gonna be having a baby soon. Like, two months.

Yay.

Yeah. I've been fighting every month trying to get myself back on track. I fell behind on bills a few months ago, and I haven't gotten anywhere with it. I'm just over $200,000 in debt, and I'm trying to figure out what my best options are to get back ahead.

What kind of debt is the $200,000? Bro?

I've got 163,000 in the house. I've got two cars and how much on car one? Credit card.

How much on car 119 thousand. How much on car 215 thousand. Okay.

That was co signed on that one.

I'm sorry.

That's right. Co signed on on the second one.

But for who?

Circumst? My wife.

Well, if you have a baby with somebody, you can buy a car with them too. It's okay. All right.

And so you'll made a human, you can share a checking account.

All right. And so the. All right, so that's 34. So you only got a little bit of mainly car debt and house debt. Right. What's the other debt?

I've got 6000 between credit cards and tools?

Yeah, tools. What do you do for a living?

Avionics tech.

Okay. And what's your household income, sir?

About? It's about 50,000 right now. For a while it went way down. I had to drain my savings account and everything. Why did it go down? The hours. I was lacking in hours at work. And then my wife, she ended up getting really sick for a little bit and was out of work. But she's finally back to work. But there's no savings account left to fall back on.

So between the two of you, both of you working, you make $50,000?

Yes.

Yeah.

She's back. She's only part time. Right. Right now.

Okay. Because I was under the impression avionics techs made more money than that.

Yeah, it may be higher. I'm just kind of giving you a rough estimate. Things are looking better and I'm working more hours. I'm bringing in.

You work on airplanes, dude, right?

Yeah. Yeah.

Okay. All right. What are you making an hour?

30 an hour.

Okay.

How many hours a week are you getting?

Um, I'm finally back to about 40 right now and I'm trying to push for 50 to 60.

Okay. You're making more than $50,000 a year. Okay. You're doing your math. You're doing your math wrong. Okay, yeah, maybe that's helpful, but, but between hours going down temporarily and her being sick and now a baby coming, the stress of all that, you're just, you're been out of control and all the money is in total chaos. Is that right?

Yeah, absolutely. Seems like I'm just getting my paycheck and it's completely gone and we still don't have bills paid.

What does she do for a living?

She's a hairstylist.

Okay. All right, cool. All right. Well, here's the thing that I know. I know that if the two of you sit down together tonight with the tv off after dinner, breathe and start writing down what you've got coming in right now and what you could have coming in in the future, you can see your way to getting these two straightened out. Whose car is the $19,000 car?

Mine.

Good. What are you. What is it worth?

I'm real upside down on that one. I was gonna sell it not too long ago, and I checked into it, and it's blue booking at about 8000 right now.

That'd be trade in. Yeah. Okay.

Trade in. They were saying five.

What'd you do, tear it up?

Did you roll a bunch of negative equity into it?

Nope, I did not.

What is it?

It's a Chevy Silverado 2012.

Chevy Silverado's. Do not get that far upside down without some. Can some other piece of circumstance involved. You've torn it up, there's extra miles. Or you rolled negative equity from the deal before into it?

No, I didn't have a car loan before.

Wait a minute, wait a minute, wait a minute, wait a minute. Wait a minute. Is this a high interest rate loan?

Yes.

Okay. 19,000 is not your payoff balance. 19,000 is the balance on the account. There's a difference. On a high interest subprime loan, they book it on top. Total of payments. 19,000 is your total of payments. If you take a check over there today and pay them off, it's more like 15,000. Okay. So you need to call them and ask them not what your account balance is, but what your payoff is today. So you're not nearly as upside down as you thought you were, so that I knew there's something wrong with that math. Okay. Now, so here's the. Here's the. Here's the prescription for this. The great news is you feel the pressure because you're a good dad. Gonna be a good dad of a baby coming, and that's gonna make you guys sit down and get control of this and not spend any money except food, lights and water, shelter, and get caught up. And oddly enough, sir, you make enough to do all of those. It's very possible.

And don't count that mortgage in your debt right this second. Let's worry about those bills and those debts, and we'll get that stuff squared away.

First thing I want to do is be current and in control.

There you go.

And you're not that yet. I saw some recent financial statistics, and there was some pretty troubling news. When families were asked how long it would be before they faced financial hardship if a spouse died, nearly one third said they'd be in trouble immediately. Another 44% said they'd be financially drained within six months. People. It does not have to be this way, term life insurance plans are just plain cheap, and companies have made it even easier by not requiring exams. In many cases, there really is no excuse to leave your family in this situation by not having life insurance. This is why I talk about Zander insurance every day. They're committed to protecting families with the only products that I recommend, and their team keeps the entire process simple and affordable. Go to zander.com for quick online pricing or call 803 564282. This has to be a priority if your family is in this situation. You need to get this done. Guys, thanks for joining us here on the Ramsey show. Doctor John Deloney Ramsey, personality, bestselling author, is my co host. Today open phones at triple 8825-5225 if you like this show, we can always use your help.

You are our only marketing plan, which is awesome, actually, because the best products in the world are spread by word of mouth. So click share on the. On the, you know, if you're listening on a podcast or watching on YouTube or whatever, click the share button and let people know. Or click the link. Cut the link out and send it to somebody in your email and tell them, start listening to this show. So you got to check this out. Got to check this out. Got to check these guys out. And subscribe. That's a big one. And follow. That's a big one. Click those buttons. And. And, of course, leaving five star reviews. All of those things actually change the algorithm in these different platforms and causes them to promote us. And. And they do it for free. Because you are telling them we're awesome. Because you're awesome. So thank you. Thank you for doing that. Lisa's in Portland, Oregon. Hi, Lisa. Welcome to the Ramsey show.

Thank you. My husband passed away unexpectedly a couple months ago and kind of in charge of all of our monies and stuff. And I'm going to get through this call without crying, so.

No, you're not. Because I'm not.

Yeah, you don't have to.

Um, so how old are you?

I'm 54. And we've been married for. Next month would be 36 years.

What happened to him? Huh?

He just went to sleep, I guess, and didn't wake up.

What was his name?

Troy.

Well, we can all be envious of that methodology, can't we?

Yeah.

Yeah.

Yeah.

That is one thing I'm at peace with.

Yeah.

He liked to be home, and here he was.

There it is. Just like that. Wow. I'm so sorry. So you got baby. You got any babies at home?

I got three grown children that are all married.

Good good. So it's you and. And you said you're up in the air on the money stuff then, right?

Yeah. Yeah. So he did set me up. I'll be okay, but I just don't know what to do with everything. And do I pay my house off with life insurance that I got.

How much life insurance did you get?

I have right now I have 500.

And what?

Yeah. Then I don't have, I think another hundred thousand, but. And then in monthly I think I added it up and I think I should be get at least 7000 a month.

Boy, I love your husband.

I know. So do I.

Troy did get what a great job. Troy well, played bad when we were young.

Yeah, we said no way. We got to turn it around.

So we did. Yeah.

Well, and he left you set with having no idea that he was going away at 50. That's pretty crazy. That's young. Yep.

Completely. I know.

Every day I live that looks younger. Oh, my gosh. The. Alright, so you only owe on your home. What do you owe on it?

I owe 240.

Okay. And do you work?

I do not work.

Okay, but you got $7,000 a month coming in.

Mm hmm.

For life. Where's that coming from?

That's gonna be for life.

What's that from?

Military. And then he was, um, he also from his. He was a police officer, so I have that retirement too.

This is amazing.

What a great guy. Oh, my gosh.

Yeah.

All right, so. Yeah. Wow. Okay, so let me play pretend I'm just. Look, you have any other debt?

I have two credit cards that are about $12,000.

Okay. All right.

And I own my cars, though, so nothing else.

If you didn't have a car payment and you didn't have any credit card debt, I mean, you didn't have a house payment and you didn't have any credit card debt. And I think you can make it on 7000 a month, don't you?

Mm hmm. Definitely.

Are you gonna get on a written budget so you don't screw this up?

Yes.

Okay. Because people can screw this up.

Oh, I know.

Okay. So that's what's scaring. Yeah, that's what scare you. I don't. This is all. Troy did such a good job and I don't want to mess it up. That's what's bothering you, am I right?

Yes, it's totally good.

Good. Okay. That's a good motivation. I don't want you to live in the terror of that because I want to give you the information. So you are doing it right. But if I had you on a detailed, written budget monthly, where you knew that you were easily living on $7,000, which you should easily do with no house payment.

Oh, yes.

Okay.

Yep.

You cut up the stupid credit cards and never borrow money for anything ever again. Say, I promise, Dave.

I promise on that one, Dave.

So we're not gonna have any debt. And we have a paid for house, and we got $350,000 to invest, and we have $7,000 a month coming in. Am I missing something?

No.

That's a pretty strong position, I think. I think you and Troy did a good job.

Here's the one. Lisa, I'm going to inject a question here to you. But, Dave, I want. I'm asking it to you, too, Lisa, is there a chance that in six months, when the smoke clears, you want to go live by some of your grandbabies?

No, I'm going to stay in the house. My three grandbabies close to me here, and I'm having a new one.

Great.

In Montana.

Okay. Awesome. Normally I tell somebody, don't do anything for six months. Don't pay off, and just sit. But this is where you want to be. This is where your family is, where the little ones are. This is your home, right?

Yeah, that's. I'll add to that question there, and I'll just go ahead and be real tacky. Okay. You said he died in his sleep. In the home.

Yes.

Okay. Are you gonna be okay living there, then?

Yes.

Okay.

He's here.

Okay.

Okay.

All right.

Have you gone through the clothes yet or anything?

Nope. It's staying forever.

Okay, so what? Here's. I'm gonna tell you, and you're not gonna believe me, but I'm just gonna tell you that's about 98% of the people like you have had the blessing. Honor to sit with the first couple of months out.

That's.

That's. And it's all good. And there's no rush.

Okay.

Okay.

Okay.

But in nine months.

Yeah.

Two years, four years, we'll see. Right. And that's not. You don't solve for that right now.

Yeah. The longer it goes, the weirder it is that you still got the clothes. Okay, but today is fine. Today's fine.

Today's great.

27 years from now, if those clothes are still hanging there, that's an issue. Okay. I'm just saying. But today. Today you're fine. Yeah. Just let it go. It's part of your grieving.

It's part of grieving.

And you're strong. Hey. And you did get through this without bawling. Good for you. And I almost did. I only had one little tear, but I cried. Applebee's commercials. So. Okay.

Okay. Can I ask you one more thing? And this is not money related. I grew up in the home of a police officer, too. Okay. There is an extra layer of. And I still feel it. My dad's in his seventies, and I'm in my mid forties, and there's still a level of. When I get around my dad, I just exhale because policemen walk around as though everything's gonna be okay.

Yes, exactly.

I want you to make sure you have somebody to call because you're gonna lean on a crutch that's not there anymore. He's in your heart, but he's not gonna be there in that restaurant. He's not. And, you know, he would always sit up against the back of the room, and now you're gonna. Right. So he's got all those little things that you always had the extra layer of. Everything's going to be okay. And your body's going to feel that that's gone because it is okay, because it's gone. And I want you to have somebody you can reach out to.

Yeah. Are you in a good church, Lisa?

Yes.

Good. Okay, here's what we're going to do. Here's what we're going to do. I've been doing this 35 years, and I've sat with people exactly where you are hundreds and hundreds of times. And you and I just went through the numbers, and everyone listened to us go through them. Your numbers are just fine. You're just fine. You were married to a wonderful man who did a wonderful job making sure you were going to be okay. And you are okay.

Mm hmm.

I would pay off my house. I'd pay off my house, and I'd get on a written budget, and I'd pay off those credit cards, and I would cut them up. And I'm going to put you into financial peace university so you learn how to handle money so you feel confident in this subject area going forward.

Okay?

And I'm gonna have you sit with a Ramsey coach that's been trained by us at my expense. You're gonna pay nothing for any of this. Okay?

Okay.

Okay. Because we're people of faith, and our book tells us to take care of orphans and widows, and we go by the book. Okay. All right.

Thank you.

Mm hmm.

All right, you hang on. We'll have. We'll have the team pick up in there and get you signed up for financial peace and get you with a coach. You're gonna be fine, honey. You're in really good shape.

This is my dream, Dave.

Yeah. Hey, guys, here's the deal.

This is it.

She just told you what it means when you put life insurance in place, have a will in place, and have your pensions lined up and so forth to make sure that your family's taken care of. It's how you say, I love you. Now, the rest of you that are listening to this, get your butt in gear and get over Zander insurance and make sure that you're Troy. Because all of you ought to be Troy. This is the Ramsey show, live from the headquarters of Ramsey Solutions. It's the Ramsey show, where we help people build wealth, do work that they love, and create actual amazing relationships. The phone number is triple 8825-5225 Doctor John Deloney Ramsey personality host of the Doctor John Deloney show and author of a couple of number one bestselling books, the latest, building a non anxious life. He's my co host, triple 8825-5225 Auburn, Alabama. Ashton is calling. Hi, Ashton. What's up?

Hey, how are y'all?

Better than we deserve. How are y'all?

We're good. I'm so happy y'all took my question, because we really need some help with this.

We'll give it a shot.

Okay. So, me and my husband were 25, and a year ago, we purchased a camper and a truck because the payments on that were gonna be cheaper than what our apartment was gonna be, which was gonna be almost $3,400. And now we're stuck with a camper and truck, and we're going through baby steps, and we're trying to figure out if it's worth keeping the pay down until it's out of the upside down or to sell and then pay on the upside down.

Do you still live in or.

No, we do not. My mom has a rental house that became available, so we live in the rental house now.

So the plan that it was cheaper was not executed. Well, this is not cheaper. If you didn't need. Now you just have a camper payment?

Yes, now we just have a camper payment, which we are renting it out currently as of, like, an Airbnb vacation, and it's paying for it. But we're worried when summer's over if it's not. I just don't want to have that. What if it doesn't get paid for? So we.

How much. How much do you owe on the camper?

115,000.

Good God.

Holy Jesus.

It's like an apartment on wheels. It has a washer and dryer, a king size bed. It's a massive fifth wheel.

What do you all make a year?

Last year together, we made, I think, 145,000. I'm a hairstylist, and he at the time was a firefighter paramedic.

And y'all are 20. Did you say 24?

Yeah, we were 24.

When they loaned you $115,000 on a camper.

I depreciated.

Yeah. I don't know how that was possible, because we couldn't get a house. No one would loan us a house or get. Get us a mortgage for a house. With me being a hairstylist and my income fluctuating. Wasn't a fixed income.

I love you. You're the dumbest smart person I've talked to today.

I'm trembling to ask this question. Have you figured out what the actual value of the camper is today?

The actual value of the camper is 90,000.

And you owe one. One five.

Yes. 115.

So you're 25 in the hallway.

Yeah. But if you go to camping world and they want to, like, buy it back from you, it's. They offered me like, 63,000.

I'm sure they did. And camping world sold you this crap?

Yes, I did.

Okay. And now I know the news is going to get worse, but I have to just keep going. How much do we owe on the truck?

The truck is 50,000.

I'm laughing with you. Not at you, Ashton.

No, no, I'm laughing at myself, too, because.

And have you priced the truck's current value?

His trade in value when we talk to a dealership was 42,000, I believe.

Okay. So you can get close to what it's worth if you private sell it, or close to what you owe if you private sell it. Because trade in value doesn't work. Okay. Do you guys have any money, like, saved up? Like money?

Yeah, yeah, we went. We're in the baby steps. We have the emergency fund saved up, and now we're just the 1000 credit card.

You have $1,000. Okay.

Yes. And then we're just dumping all the extra money we have into credit cards to get them.

How much do you have in credit card debt?

Totally 7000.

Okay, good. All right.

And then my car.

And your car is what?

My car is 10,000.

Okay. Okay, good. All right. And I assume you've been so far paying everything on time, and so your credit's probably stellar.

Yeah. Our credit still good? Thankfully, it's still very good.

Okay. The longer you wait to sell the camper, every day that you wait, the spread between what you owe and its value gets wider. Agreed. The value is going down faster than the loan balance. Agreed?

Yes. Yes, sir.

So we don't want to delay. We want to sell the camper as soon as we possibly can sell it without giving it away to camper world or whatever they're called. I don't want to go over there again, but. But at 63,000. No, we're not doing that. But if we can get 90 for it or 89 or 92 or 85, the suckers gone. Okay. So get it up for sale today, and then you're gonna have to go to the credit union. Where's this loan? Is it camping world gave you the loan to?

Yes, it's through Alliant credit union, I believe it is.

Yeah, of course it is. That's who makes loans like this. They're probably not going to be any health, but contact them and ask them if you can sign a note for the difference unsecured. So you sell it for 90, you sell it for 9001. Hundred, 15. You're gonna have a $25,000 note with alliant if you did that. Otherwise, you got to go to your credit union or your local bank and get them to loan you $25,000 and.

Do it like a personal loan.

Yep. Yep. You know, all we're doing is reducing 115 to 25. That's a good move.

Yes.

Okay.

And it's not a $1000 payment like we're making now.

Exactly. And we're gonna sell this truck as soon as we can get close to what is owed on it. So put it on Craigslist and put it on other stuff. And. And because, you know, we can get a vehicle down closer to your vehicle that is doable. And, of course, we're going to clear those credit cards. So now if you're making 145 and you owe 25 and you owe ten on your truck and seven on credit cards and a little bit on some kind of car we get for him or truck we get from him, like 10,000, we can clean that pretty quick. You could be out of down a.

Thousand in two weeks.

Yeah. But you could be out of debt completely if you'd make those moves. Sell his truck in the camper by the end of summer if they're gone at a reasonable price. And that way the hole's not too big on either one of them that you got to pay back. But you could be debt free in 18 months.

That would be awesome.

But that's living on beans and rice. Rice and beans. No more pipe dreams.

Absolutely.

Because this was a pipe dream. Like drugs were in the pipe. Pipe dream.

Yeah. We smoked this pipe dream.

But it sounds crazy to do a $3,400 apartment, too.

Like, I know you traded 30. That compared to the truck and the camper. The $3,400 apartment is freaking lights out. Genius. Compared. Yeah.

Or think about it this way. Think about this way. Ashton at 34, it was about. You would have paid about 40 grand this year in rent in this apartment.

Yes.

You're hoping to sell this at a loss to where? To minimize your loss to $25 to $30,000 to pay off.

Yeah. So there it is. You paid it anyway.

You paid it anyway. You just didn't get to live in an awesome apartment.

Yeah. Instead you were on an apartment on wheels from camping world.

Dave, it's so great. I can feel you. Try not to laugh. Right next to me, I'm just $200,000.

Stay in Auburn, Alabama. Bless your heart. This is the Ramsey show. Thank you for joining us, America. We're glad you're here. Doctor John Deloney Ramsey personality, is my co host today. Today's question of the day comes from Tracy in Texas.

All right, Tracy asks, my husband and I have been married for over 20 years and we have six children together. He is a high functioning alcoholic and he's emotionally abusive. Last week, things escalated to the point where I had no choice but to call the police and have him arrested. I filed for divorce the next day. We make a combined $320,000 per year, but live paycheck to paycheck and have $0 in savings. Our only asset is the equity in our home. We cannot afford a divorce and he has promised to make me pay for his arrest. I feel like I will be forced to let him come home because I don't have any other financially realistic option. I earn six figures on my own, but I'm worried about how I'll feed my kids and keep their mortgage, mortgage current. I know I need the four walls first, but I'm overwhelmed and can't do this alone.

Okay, first thing, by definition, he's not high functioning, right?

Yeah, yeah, yeah.

He's not functioning. He might have been high functioning in the past, but not now.

Yeah.

And so, wow.

And good for you for having the courage to call on him, man. Um, yeah. If he got arrested and there's. There's some parts left out of here. Um.

Yeah, it was no longer emotional.

It was not emotional.

It wasn't just emotional abuse. If you get arrested, they don't arrest you for yelling.

Yeah, but good for you.

Good.

Um, so when you say, we can't afford a divorce, but I earn six figures. Dave, tell me if I'm wrong here, but it seems to be a lot of chaos and a lot of mess here. If you earn six figures, you can go get, um, a relatively nice apartment, and you can go. You can figure out the house stuff later. Yeah, but you can go get a place where you're safe.

Yeah. Go work, go rent a house and put the house up for sale. And tell your divorce attorney that they get paid when the house sells. And they'll be happy with that because there's plenty of equity there. And, I mean, if you have scratch together a few thousand dollars or something to put down a little bit of a retainer, that'll be fine. But here's a thing. I'm. This is. You can speak into this because more your area of expertise, dealing with trauma and dealing with these things. But we know. I know this before John came here, but now John has. Doctor John, with his PhD in counseling, has reaffirmed this. I know that there's a high correlation between money control, extreme levels of control by the man in the house, and domestic violence, using her as a punching bag. And part of the narrative that is used there is, you can't make it without me. I'll make your life miserable. You can't. You know, you can't survive. You can't survive. You can't survive. And after 20 years, she believes it.

Even though she can go to work and someone's gonna pay her six figures, but she can't do it at home. That's right.

She still thinks he has power.

Right?

I make you pay. To which John and I are almost chuckling to ourselves, because this is a guy who's so out of control, he's in jail. He ain't gonna make anybody pay. He's not exactly a threat. He's what's known as a bully that got punched in the nose. And most of them are absolute wusses. Once you punch a bully really hard, they just sit down and cry and moan. And that's what this guy is. He's. He's a coward.

Yeah.

And so because his only chance, his only chance of upping someone is his wife. This is a coward. And so he's not as big a threat, darling, as your psyche, which has been reconditioned over 20 years, tells you, agreed, 100%. So, I mean, I'm seeing domestic violence language in this.

Am I wrong all over this? Yeah. And sometimes it's even hard to write that down. It's hard. It's hard to write it down. So, yeah, you earn six figures. Go get yourself. And by the way, your life, your standard of living will change dramatically. You're gonna have to let that go. Go get a small house, the smallest houses you can afford, with six kids, and it's not gonna be fancy. It's gonna have for mica, countertops and all. Who cares? You're gonna have safety in your home for the first time in 20 years. And, yeah, tell your attorney that he. You get paid when the house sells, and he's gonna have a highfalutin attorney also.

No, he doesn't. He didn't have any money. Nobody's got any money.

Well, that's true. Yeah. He didn't have any cash either.

He's in exactly the same place she's in.

That's a good point.

I'm going to make you pay. Where are you getting the attorney's fees, buddy?

Yeah.

Yeah. So he's as broke as she is, so they got a lot of equity. That's it. And they got a good income. That's it. So what I'm gonna do is start. I'm gonna get out of the house and park in something cheap and get the house sold with a court order with the attorney as soon as possible. Like, I mean, fast. Like, blindingly fast. Not even as a part of the divorce settlement. Just the money's paid into the court until the divorce is settled, and then let the attorneys get paid out of that, and then just make sure that they don't keep it there for five years and they're the only ones getting the money. Okay, but, uh. But Bubba. Bubba has got no power here. Yeah, he's. He's at, you know, the only power, Tracy, that this guy has. He has no financial power. He has no emotional, spiritual, uh, physical power. The only power he has is between your ears. And as long if you quit, the day you quit letting him live their rent free is the day this whole thing turns over fast, because John and I aren't. We're not intimidated by him, and we can see real clearly exactly how this is going to go down.

And you're going to come out of this just fine, other than the healing that you're going to go through from the years of calling this a high functioning alcoholic, when in reality, he hadn't been high functioning, if he ever was, in a long, long time.

And I want to speak to this. If this happens to be Tracy or anybody else listening. I remember always getting a pat on the back of my annual review because I was in charge of a lot of revenue and expense accounts, multiple millions of dollars, and we always came in under budget. That was like a thing I was known for, always going to land underneath that. And my household finances were a mess. And I always felt a ton of shame that I could do it so well over here. But when I got here, I wasnt a person of discipline and any self control or anything like that. And so if this is you, Tracy, youre good at work, you make six figures, but at home, everything feels chaotic. You have to do the brave, scary, hard thing and ask for help. You gotta ask for help. That's what FPu's for. That's what every dollar is for. That's what our financial coach is here for. That's what your neighbor down the street is for. That's what your minister is for. You gotta ask for help and say, okay, I am great at work here, so much that they pay me six figures.

How do you make a checking account on your own? How do you, how do you do some of these basic things that you quote unquote, should know, but you know how to do it. Okay, let's go get the help we need to do.

Yeah. And talk to your boss at work. If you're making six figures, you may need a ten grand advance pay to get the new place, deposits and all, and to get a little bit for an attorney to get started but can't afford. I feel like I will be forced to let him come home. No.

Nope.

I thought I saw that in there. Let me go back to that. He wants you to feel that way. There's nothing in the law that says that. There's nothing. I mean, you need to get a restraining order and, you know, you need to make him pay for inflicting this on you and six kids. Yeah. And it's not a matter of vengeance. It's a matter of boundaries, safety and safety and no, come home, by the way. He could come home, but it might be in an empty house where? Cause you moved to a rental.

Right.

And the house he's living in is up for sale by court order. Yeah. And that's where I want this thing to go as fast as possible.

And what about the kids? And what about the kids? Let me tell you, the kid.

The only way the kids are gonna be okay to when you are.

That's right. That's right. Having a dragon living inside your house is infinitely less safe than them having to move in the middle of a school year or in the summertime or whatever.

The dragon does not get to come home, correct. Yeah. Nope. Sorry. Sorry. Dragon. We discovered you're a dragon. Who knew? Now you can't live there.

What a mess.

Yeah. It's like, you know. Huh? We thought you were a pet dragon. Well, it turns out you're a dragon.

It's. It's amazing. Dave, you said it. It's, it's. You can be so in control over here and somebody just beat you down for 20 years for so long. You just believe, you believe that story. The story becomes a story you tell yourself. And it's really hard to change that narrative. Yeah, it's tough.

So, Tracy, to use John's phrase, you're worth, you are worth not being a punching bag. You are worth standing alone and creating a new life that's full of peace and you got to go do it. It's going to be hard, but it's going to be a lot easier than dealing with the dragon. This is the Ramsey show. Doctor John Deloney, Ramsey personality, is my co host today. Open phones at 888-255-6225 well, Ramsey events are in full swing around here. We had a great event here last weekend with the total money makeover weekend. It was one of the most fun events I've had in a long, long time. I thoroughly loved it. It was old school tmmo stuff, man. And it was. It was a blast. Our upcoming money and marriage event with Rachel Cruz and doctor John Deloney sitting beside me just sold out. And it's in October, so it's done. Next week. We have our brand and that means you got FOMo. So get ready. Next week we got a brand new virtual event. And the good news is there is no seating limitations when you're doing things virtually. So ultimate number of living, unlimited number of living rooms out there to watch this in Dave Ramsey's investing essentials.

On two nights, I will be doing this. Not the same thing each night is individual. The second night, I'll give you a hint, is mainly real estate. And I'm going to open up my personal playbook of how I personally invest and the processes I use, the principles I use, the actual things I put money in and the people that I run around with, many of which have $100 million net worth or greater. What are they really doing? Not what your broke tick tock influencer living in his mother's basement is doing, but we're going to actually show you, like, real people, real rich people, and what they really do. And it's not flip this house. I'll just go ahead and give you a hint ahead of time. So. Yeah, so anyway, it's gonna be fun, and it's actually sold like crazy. Like, bazillion of you have already bought tickets. Thank you. Two night virtual event, May 2122, which makes it next week. It's 199 bucks. Get your tickets to that ramsaysolutions.com events. And the cruise is almost sold out for next March. The Ramsey cruise. There's gonna. It's March 22 through 29th next year. It's all the Ramsey personalities plus a bunch of celebrities gonna be on there with us.

And so it's gonna be a lot of fun. It's the live like no one else. So if you're baby step four or beyond and you want to come, we'd love to have you. We don't want you spending money on a cruise when you're getting out of debt and building your emergency fund. That's wrong. So don't do that. That's why it's called the live like no one else cruise. So that later you can live and give like it's the later part. Live and give like no one else cruise. So it's gonna be a lot of fun. And there's a handful of. Handful of suites left, but are not suites rooms. I think the suites are all gone, but the. I think it's, like, 80% sold out right now. And it's only been up for, like, four weeks.

And I heard that you're. You've challenged the boat to a cannonball competition in the big pool. I'm excited about that. Joe Levitt told me that you're gonna be leading the way. It's gonna be awesome.

Really?

Yeah. He said you have a big onesie swimsuit that you're instead not.

So the speedo rumor went away. That's good. Yeah, that's good. Okay. That got next.

They took a company vote.

No. Not doing any of the above, but your big ones above. It's gonna be awesome. I don't know where these people are hanging out together and what they're ingesting while they're having these discussions. But not doing it. Gummy bear breath. Not doing it. Just saying. Not happening.

Not those kind of gummies.

All right. Erica is in Kansas City. Hi, Erica. What's up?

Hi. I was wondering, where does a big home renovation project fit into baby steps? Would it be like baby step three b?

Could be. It could be. 456, probably. 456, something like that. How large a project you want to do?

Yeah, we have a house that is. It's kind of like a two and a half bedroom house. And we need more bedrooms for our kids as they are getting bigger.

Okay. Why don't you sell it and buy one?

Well, we have land and land prices have almost quadrupled here.

So you like the land? You like the piece of ground you're on?

Yes.

And how many acres have you got?

30.

Oh, that's nice. Very cool. Okay, and what's the square footage of the two and a half?

It is 1800 square feet.

How old is it?

Over 100.

Okay. Is there any historical value or family value to that particular house?

No, none at all.

Push it down.

Push it down.

Yeah. Be a lot easier. I've done, I've done probably, I don't know, 500 renovations. Renovating something that's 100 years old is my idea of. Hell. They don't build them like they used to. Thank God we built so much better house. Nowadays. The pipes are bad, the wiring's bad, the roof is bad. The lumber that was put in there was rough sawn. It's twisted like a turkey's toe and. Oh, God, no, it just. It's all. But when you get done with this, you're just going to have a hundred year old house that's been patched up again. That's how you end up with two and a half bedrooms. We call them country built houses. People just keep adding crap to it and it just looks like a. Looks like a labyrinth to get through it and just keep adding another room out there. And add another room out there. And so I would consider that now. So you'd build a 3000. What's your household income?

110,000.

Good. Okay. So you could just get a construction loan, move into an apartment for a year or move into a rental or get an old $5,000 trailer and put on the property while you bill and live. Live in that crappy thing and while you build the house, whichever. I don't care. And then build a house. That's what I would do. You do whatever you want. But if you're going to spend almost, you're going to spend about the same amount of money, a lot more trouble, and end up with a substandard product if you renovate. So. But go ahead and renovate if that's. If that's the game, if y'all want to do that. You're talking about spending a couple of hundred grand, though, aren't you?

This particular project, we are thinking under 75,000.

What are you doing?

There is an attic space, and it would be convert, making it livable.

Can somebody look at the structure?

Doesn't fall into the basement. We don't have a basement. We have spoken with an engineer and it'll hold it with some reinforcements. Yes.

Here we go.

Okay. All right. I rest my case. But the. The defense rests. But the. So, yeah, yeah, if that's what you guys want to do. But I would do that it. To answer your original question. Four, five to six.

So would you pay off the mortgage before you did something like that?

No, I'm fine. It's 456. I mean, if you. If you come up, you make us. You make $75,000 in cash renovation. You want to buy something that's $75,000 in cash. You want to do that before you pay off your mortgage. That's a four, five, six. Baby step four is 15% of your income into retirement. Five is kids college. Sixes would pay off the house early. You're going to reduce how fast you pay off the house in order to come up with 75,000 cash in order to do this renovation. I personally think the whole financial transaction would also be easier if you took out a construction loan to build a house where that one was and made that your new mortgage on a 15 year fixed. And when you move into it, you've got a solid product, and that's the direction I would go. And it's just then all of that sitting at baby step six, you're just going to pay off the house. So the renovation is rolled into the mortgage the way I'm talking about, because it becomes a new house. And I think you'll end up with. Yeah, I. You're probably gonna end up with more.

More of a mortgage than you're going your way. Well, I know you will. I know you will, because I'm pushing down your house. So. But. But you're. But you're gonna be like $100,000. Glad you did. So I think you need to watch more HGTV.

Dave, you don't have the vision. All she needs is $150,000 in engineering.

Have you really? You know, I never watched that, but I was actually in a waiting room the other day, and they had that thing on and I was trapped and I couldn't get away from it. The people that are doing that stuff are the most unusual humans. Have you noticed? It looks like something out of a zoo. It looks like a Star Trek bar, a Star wars bar. There's gonna do a house renovation. I mean, there's like, like, no, there's. There's no, like, regular rednecks going in there and just renovating.

That would be. No, Chip and Joanna did that.

Well, Chip and Joanna, pretty normal. Yeah, I think that's your move, dude. Renovations, from what I've heard. But. But the rest, I mean, the redneck.

Renovations, you'd be a billionaire. Yeah, I think we're onto some, Dave.

Except that I don't want to do it every time. That'd be hilarious, Dave, just how are we going to fix this bedroom, Dave? Push it over.

Knock it over.

This is the Ramsey show.

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So the guys in the booth have already launched the redneck renovations show during the break.

Hey, here's what it is. It's a call in show where people all over the country call George and Kamal and Ken Coleman and ask them plumbing and electrical and renovation questions.

Two of the most inept people that could possibly ever answer those questions on the plane. That's not. There's nothing redneck about that. That's just in app.

That'd be so fun.

It would be incompetent, but it wouldn't be redneck. That's not funny. This is going nowhere. Matt's and Matt and Dana in Omaha, Nebraska. Hey, guys. How are you?

Not too bad, Dave. Thanks for taking our call.

Sure. How can we help?

Well, so I've been. I'm a farmer out here and got in kind of hooked up with you because I was sick and tired of my terrible financial decisions for years and years and years and years. And my wife and I have downloaded the everydollar app, and I think I'm going to purchase the premium tomorrow. And one of the questions that I have is my 17 year old daughter, Dana, who's on the phone with me now. We were talking about just college, and we don't have a college savings at all for her. She's a junior, just finished her junior year today, and she's like, I got to build credit. And I instantly was like, nope. You need to get in touch with Dave. Ramsey. So as my wife and I begin this journey of, we don't have a horrendous amount of debt, the biggest thing that we need to do is control our money. So where, I know where it's going. So that's, that's the journey we are on. And I don't want my daughter to make the same mistakes that I did.

Okay. Well, that would be every parent that's a good parent anyway. And so when a 17 year old, and she's on the phone, what's her name?

Dana.

Dana. Okay. So when Dana says, I want to build my credit, two years ago, you would have thought, oh, that's probably a good idea.

Probably.

Yeah. And now you're, like, going, oh, God, Dave Ramsey. Exactly. That is exactly what I'm doing. Well, and here's the thing. So, Dana, Dana, what happened is this. The Bible says, be not conformed to this world. Don't be like everyone else. Because if you look at the statistics of average in America today, what you find is the average divorce is caused by money fights and money problems and money stresses. If you look at the statistics, 70% of people are living paycheck to paycheck. If you look at the statistics, people who chase the credit and debt game spend their lives earning money for other people and giving it to them in the form of debt payments. And. I'm sorry, that's.

That's her dad right there.

Yeah. And, and so that was everybody. I mean, it's normal. So that's why we say, don't be normal. Don't, don't be conformed to this world. If what this world is doing isn't working, why would you want to be one of them? You want to be weird? If. If normal is losing, we want to be successful. We want to win, then we don't want to be normal. If the group of friends you're running around with are going nowhere, then guess what? You're going to go nowhere because you're hanging out with them, embracing the same set of habits, patterns, and behaviors that they embraced. Reading the same books, which are useless, reading this, watching the same useless movies and Netflix garbage. And so, you know, if that, if that's what you want to be, if you want to be normal, yes, go build your credit score. But normal is broken and normal stressed. And so I think you don't want to be normal. I think you've been lied to by a normal culture that told you you have to have a credit score in order to become prosperous and successful. And the truth is, the actual data tells us that it's the opposite of that.

And so that's, you know, where we are. Then the second part of the equation is, how am I going to go to college? Because mom and dad hadn't saved for college. And you're lucky because the guy sitting beside me has a PhD in higher education and has served in several different universities, in the leadership team in the administration of several universities around the nation, and actually knows exactly what the college scene looks like. And before I pitch to him, I will tell you that you don't have to go into debt to go to college. You do have to select a college you can afford. And there is no difference between the data. Again, what we're trying. Why are we going to college? We're going to college to become more successful and to have a better quality life with the knowledge that we get. It's not actually the degree that matters. It's the knowledge. And so we want to go get knowledge. And the truth is, is that you can pay $100,000 a year for the knowledge, or you can pay $12,000 a year for the knowledge. And the tr. And the knowledge is basically the same.

So you can get a degree in marketing for $100,000 a year at, you know, most expensive universities in the nation, or you can go to a state university and pay $12,000 a year and get a degree in marketing. And it's basically the same information. And there's no data that says where you went to school. Cause you'd be successful. There is data that says when you have more knowledge, you have a higher probability of being successful. Knowledge that's useful in the marketplace, like a marketing degree or whatever, that kind of thing. So I would tell you that if you select a. An inexpensive school, you're going to get a great education and you're going to work while you're in school, and that's going to give you a great education. I did. John did. Most people do. And then you can come out with no student loan debt, and probably your mom and dad, since they're getting their crap together, are going to be able to help a little. John, what would you say?

Well, I would say, Dana. So what do you think about all that?

Yeah. Okay. So my plan was to attend, like, a community college and not a university.

Great.

Brilliant.

Because it's just, I've been told a lot, the university is just not worth it. And so.

Well, that's not true. It is sometimes, but not always, depends on what you want to do and when you want to do it and how you want to do it and all that, but if you've decided you can. You can meet your short term and long term goals right now, starting at community college. Amazing. Go for it.

That's the best. That's the best deal on the market.

Great.

For the first couple of years, right?

Yeah.

I think we just lost them.

Oh, we just lost them. Well, so, Dave, while we're here, here's the thing. Mike Rowe, the three of us have talked about it. It's. There's a both. And to this, there is a. No one needs to go to college. It's so stupid. Well, that's not true.

That's not true.

I do not want to go to a doctor that didn't go to college. I don't want to eat engineer building my house didn't go to college. And does everyone have to go? No, they don't. Or does everyone have to go to every. Does everyone have to go to Harvard? No. God, no. So, some of the most amazing people I know started in community college, and I had law student graduates started in.

Okay, Dana, we're back with you, I.

Think, in community college. All right.

There we go.

There you go.

Somehow, the call drops. Sorry about that. All right, Dana, we're back with you. So, you're talking about two years in community college and then maybe move off to university to finish it. Sounds like. What are you talking about? Studying?

No, I'll do probably four years at a community college and not move on.

To a university and a degree in what?

I'm going into nursing.

Okay, beautiful. That's great. Wonderful. Wonderful. And then you got to go. Then you got to go to nursing school, right?

Yes.

Okay. And you got to pass your boards. But nursing is probably one of the best career choices you can do out there, because there's. Ever since I'm old and ever since I've been doing this, like, 40 years, there's been a shortage of nurses. There's always a shortage. And so you can kind of pick and choose where you work, and they'll pay you a lot, and you can always get as much overtime as you want.

Yeah.

And when your dad gets some weird itch from working on the farm, he's going to call you, and you can help him. Right?

He gets a rash.

That's already happening. It's already happening.

Ew.

Oh, Matt, come on. But, Dana, listen. Everyone in your world is telling you the only thing that matters is the car you drive is your FICO score. Is all this. It's nonsense, man. It's just nonsense. And I know it's hard when you're 17 to have three knuckleheaded old men telling you to do something else. But if you, like, you're at this weird crossroads and you can go, you can take a left or you can take a right, and one of these paths is going to be like, just like Dave said, everybody else. And if you look around, everybody's broken. Or you can go right and you can take another. You can go the other direction.

Matt, can y'all chip in and help her pay for community college?

I'm hoping.

Okay, well, she's only a junior. I mean, you're just now started getting your stuff straightened out. I think you can't. I think you're going to be there because you said you didn't have a lot of debt. You're just chaotic. Right?

Correct.

Okay. So, yeah, I think I'm. I'm making that as a part of the thing. Now. I will tell you, Dana, that if you're my kid, I'm not going to help you. I'm not gonna pay for part of your school if you turn around over here and doing something stupid like going into debt or something. Okay? So I'm not gonna assist you in harming yourself if I'm your dad. But. But if he can be a part of the solution, since you're being very wise about where you're going to school, I think he should. If he can be, I think it'd be fantastic. That's perfect. Hey, good call, guys. Thanks for letting us preach at your 17 year old. This is the Ramsey show. Live from the headquarters of Ramsey solutions, it's the Ramsey show where we help people build wealth, do work that they love, and create actual amazing relationships. Doctor John Deloney, Ramsey personality number one, best selling author, host of the Doctor John Deloney show, is my co host today. Open phones at triple 8825-5225 Kim is in Atlanta. Hi, Kim. Welcome to the Ramsey show.

Hey, Dave and John. Thank you so much for taking my call. I watch you guys all the time and I love you guys.

Well, thank you.

I have a morgue question for you. I'm 63 and I want to pay off my mortgage like you always talk about, but I have a. Have investments. But do I take that out and cash it in, some of it to pay off the mortgage or do I just continue to try to pay over.

What's your mortgage balance?

It's $100,000.

Okay. And how much in your non retirement investments?

127.

Okay. And you have an emergency fund instead.

Of that, I've got like, 10,000.

Okay. And how much in your. Four hundred.

One k. Five hundred plus.

Okay.

I wish it was more, but it's not. And I'm 63.

Are you still working?

Yes.

What do you earn?

About 97 a year.

Good for you. What's your, what's your career plan on? How long you gonna work?

I want to retire instantly. Well, I have a. I also have a booth in an antique mall.

Okay. But I mean, how long do you plan on making 93 and adding to the 500?

A couple years, I guess.

Okay. 65. You're thinking 65? Okay.

Yeah. They don't downsize me out.

Okay. So if you have an emergency fund proper, and which you do, and you take 100,000 out of your non 401k money, you should have virtually no taxes on it. There may be some capital gains, depending on how that's structured. Okay. And you pay off your home mortgage, that leaves you basically with 500 grand. Agreed?

Mm hmm.

Okay. At 63, if you add nothing to that and it's invested in good mutual funds averaging 10%, it'll be worth a million when you're 70.

It's ultra conservative right now, so I guess I need to rethink it because I was scared, you know, I was like, well, everybody's losing money, so I'm.

Who's everybody?

I've made a killing this past year.

Did you?

In a regular, regular mutual fund? Nothing.

You need to get with a good, smart vest or pro and have this adequately invested. I don't want you taking a bunch of risks.

Get off the news.

But you get off the news and quit and don't listen to everybody. They're a bad financial planning firm. Yeah, let's do that. And so, again, if you don't add anything to it and you're going to add two years more of 401K contributions to it, is what we're planning is today. Right. But not counting that two years that you're going to add to it, which is going to be another 50,000 or so, give or take, then what you could easily do if you don't have a house payment. Right. So load that 401k up for the next two years, and then count on it doubling about every seven years. The lump sum if it's invested in good mutual funds averaging 10% plus. Okay, so again, a half a million at 63 becomes a million at 70. At 77 is 2 million, and that's if you're not cashing it out to live on, and I don't think you will be. So I think you're in good shape, because I think you'll probably create enough antique mall income to eat on and be leaving this alone and letting it grow. And so. And the house is worth, what, about 350?

Okay. So you're about an eyelash away from already having a million dollar net worth. Way to go.

Thank you.

Well done.

Yeah. Thank you for your advice. I was wondering, you know, should I just continue to try to, you know, pay on the principal, or should I take the money out and just go ahead and go for it?

Go for it. And then the thing that I think that'll do is it'll probably do two things. One is I want. Number one is I want you to start investing that old house payment immediately so you got more investments to offset. We're not trying to increase your monthly cash flow. We're trying to, you know, use the money that would have been going to a bank. Let's put it into your account. Now, the second thing is, and this will be weird, but you can. You can look back and write it down and look back five years from now, see if it really happened. I think that if they try to right size or downsize you, you'll make a completely different decision or have a different discussion in the negotiation with them. If your house is paid off than if it's not true, it puts a little swagger in there to where you go. You're gonna. You're gonna lay me off, and I'm 63. You better get ready to write some checks, boys and girls. I mean, and you can. You can toy with them a little bit. Right? But if you kind of got a house payment hovering in the background, you're not.

You're a little bit more mild, a little bit meeker.

Do you have a. Is it gut feel, or is there some sort of matrix? Cause I think about my mom, who's in her seventies, if she was to call with that same question. There's a balance between, I want you to have the least amount of risk exposure, which so don't have a house payment, versus you're gonna have to pay bills ongoing. So how much money? Right.

See, I'm saying, if she had a hundred thousand to her name, I wouldn't do it.

Okay. So you wouldn't wipe yourself out?

Not at 66, not at 63.

Is a quarter million okay, is it 500,000?

I just. I want some kind of a substantial nest egg, depending on her situation.

So 4% draw, the. Like. Now you make up a number.

4% draw. But. But the. I'm just saying, is there, based on the standard of living that this person is living in? What's their nest egg look like after we pay off the house?

Okay.

Okay. Now, if they're. If they're used to making $40,000 a year and the mortgage is 40,000, you know, that's a. That's a different standard of living than she's living.

Correct.

Okay. She's in a half million dollar house or half a million dollars in savings, $350,000 house, and she's making $100,000. I'm basing all of those things in there, and I'm saying, all right, what's a person like that need in a nest egg to be pretty comfortable after we pay off the house? Well, she's gonna have a half million left, so she's fine. If she had 400, she'd be fine. She had 300, she'd probably be fine. But if it gets down in there and she's at 200, there's all that's left. I'm kind of on the bubble at that point with her. Now, if you're making $40,000 and you're paying off $40,000 house, you got 200 left. That's a lot. So that's the ratio kind of thing I'm looking at is the way I'm pulling that through. But, um. And I always feel it's.

It's. It's under appreciated on either side. Um, yeah. I want to tell a 70 year old dude, if you don't have a house payment, don't have house payment, like, because no one can take it from you.

Right. You do. You do want. You want to get there, and then.

The other side of it is don't. Yeah. Don't melt everything, because if you melt.

Everything, you're one of those people that's house poor. Right. And you're digging up the bushes to eat.

There you go.

You got nothing to eat, but you got to pay for house. Right. We don't want to get you there.

Or you're completely a hundred percent leveraged with Social Security, which. That's wobbly.

Right?

That's real.

Well, I mean, it's just not enough. You can have to buy out po to eat. And so, um, yeah, we don't get there either. But that's. She's done a really good job. She's in really good. Oh, yeah, Kim's done. Good job, Kim, so well done. Solute. This is how you do it, boys and girls. So here's the thing. That's the stuff you want to aim at, because when you're 60 and she's 63, I'm 63. If your home is paid for, your largest line item in your budget is taken care of for the rest of your life. The expense is limited to almost to taxes and insurance for the rest of your life versus if you're a renter, it goes up every year for the rest of your life. Or if you got a house payment, you got a house payment every year for the rest of your life. So that's where we want to get away from. Is this rest of your life stuff? That's not good. This is the Ramsey show. Listen up. Trying to reach your money goals without a rock solid budget is like trying to climb Mount Everest in ice skates.

It isn't going to work. That's why we built the everydollar app to help you win with money. It's the simplest, most straightforward way to track your spending and give every dollar a job. That way, you can stop letting your money push you around and start reaching those money goals. Download every dollar for free on the App Store or Google Play. Doctor John Deloney Ramsey personality is my co host today. Thanks for joining us. Listen, no one wins at anything by accident. Winning is a series of incremental, intentional acts if you want to get your body in good physical condition, it's a series of incremental acts, and none of them involve a Big Mac, right? I mean, we know what we know that we know, right? If you want to have a good marriage, it involves flowers. There's a series of incremental positive acts. It involves other things a lot more important than flowers, but it even involves flowers. My wife, who detests flowers. Money being spent on flowers because it's a complete waste, still smiles every time she gets the complete waste delivered to her front door. Okay, shut up about it. But there we go.

So there we go. I mean, there's a series of. Money's no different if you're going to win with money. We know that the people that win with money are the people that tell the money what to do instead of wondering where it went. They have what's known as a plan. They don't accidentally win. That's why the lottery is such false hope and why it makes me so angry. Not from a moral standpoint, but when I know that 80 something percent of the tickets on the lottery are bought from poor, end of town zip codes, that's people that have been sold false hope by their government. And in Tennessee, that money's used to send rich people's kids to college, which I think is just a wonderful wealth transfer from poor people to rich people. Take money from poor people and send rich people's kids to college and call it the lotto and everybody's happy. That's what we did in Tennessee. It's gross what they did in Georgia. So it's how bass ackwards the whole idea is. So. But winning with money is a series of incremental acts that are intentional with the money. And that's a budget.

You got to write it down. You got to tell your money what to do. You got to give every dollar an assignment and then make it freaking behave. Get a whip and a chair and crack the whip. You are a money tamer. Like a lion tamer, if you remember the old cartoons, right? We're going to make them. Make them get up on the little podium, the whole thing. Make PETA mad. We're going to do every bit of that, right? And so make the animal behave. Make the money behave. You are a money tamer. That's your budget. Give every dollar name. That's why we named the world's best budgeting app when we started building it several years ago. Everydollar. Now, everydollar also is incrementally better. It gets incrementally better every month. And we're adding features to it. We're adding things to it that make it better and better and better and better and better. It is the world's best budgeting app. Tens of millions of people manage their money on this. And if you want to download every dollar for free in the App Store, you can. And then you should actually use it after you download it.

Downloading it doesn't count. It doesn't work by osmosis. You got to open it up, put your stuff in it, sit down with your spouse and make it behave. Use the App Store, use the Google Play, or go to everydollar.com and get started for free. This is the Ramsey show. Kendall is in Charlotte, North Carolina. Hi, Kendall. Welcome to the show. How can we help?

Hey, thank you so much for having me. So my husband wants to go back to Pa school, which is going to be like $100,000. So I'm kind of just trying to figure out, like, I've just finished saving up our emergency fund and was kind of, like, getting ready to start paying down some of the debt that we have. And I'm just trying to figure out, like, how to best prepare for these student loans we're going to have to take out, like, you know, do I just keep trying to save as much as I can. I don't. He's also going to have to leave his job in order to go back to school. So we'll go down to one income. So just trying to figure out how to prepare for that.

Well, you're, you're kind of new to this Ramsey stuff, and he obviously doesn't even care about this Ramsay stuff. So let's, let's back up about 53 steps for a second here. What's your, what's your household income today?

110,000.

And what does he do today?

He's an athletic trainer. Sports medicine.

For what?

Athletic trainer for sports medicine.

Okay. All right. And what does he make?

50,000.

Okay. And so you make 50 and some change, right?

Yeah, I make about 60. I make a little bit more.

What do you do?

I'm also an athletic trainer.

That was a great flex. I mean, I make 60. I make a little bit more. Well, well done.

Yeah. An athletic trainer that flexes. There we go. So that's perfect. And so how much debt have we got?

So we have, we owe 255,000 on the house. I have 20 in student loans, and then we owe 5000 on our cars.

That's it?

Yeah.

Okay. All right. So here's what I would tell you. And the thing is this, the way I answer questions is what's going to put you guys in the best possible position in every part of your life ten years from now and 20 years from now, not ten months from now.

Right.

Okay. I really don't give a crap about ten months from now. If you're completely uncomfortable and you hate me ten months from now, that's perfect.

Okay.

But if that makes you completely the best place you've ever been in your life ten years from now. In other words, it's much like training. You're going to have some discomfort in order to build some muscle. Agreed. The tearing and the lactic acid and so forth. Am I on to something there?

Yeah.

Yeah. My metaphor is working is all I'm saying. And so the, so what I would say is being a pa is an excellent career choice. Completely endorse his dream. There's not a chance in the heavens that I would go into debt to do it. No way. Oh, I'm not kidding. It's not a laughing matter. I really wouldn't.

Yeah.

The best life you could have is for him to become a pair and figure out a way, if you'll listen for a minute, that we don't go into debt to do it. The first step is to pay off the debt that you have. The second step is to build an emergency fund. And then the third step is while he's looking for scholarships and while he's applying for grants and while he's talking to his employer, who might need a PA, he's talking to some hospitals in the area who would hire him immediately as a PA. Might even put him on now as an on staff sports trainer, and they might have a scholarship program for employees. Who knows? There's lots of ways to get people to pay for your education and, and, or save some of it after you don't have $25,000 in debt. That delays him starting PA school, but it doesn't delay at a decade. It delays it two years or a year, depending on how many scholarships he can find and grants he can find. But the chances I'm going to tell you to sign up for $100,000 worth of hell called student loan debt is zero.

Right?

That's zero. I love you too much to want you to do that. I don't want that for you. That's living a dream in such a way that you turn it into a nightmare.

So. So you're saying try to save up as much as possible prior to him going and then try and see and try and see where we can get the grants and some employment help.

Yep. And or future employment. Who's going to hire him in the future? Listen, there's such a shortage right now. People want pas, and Pa is such a solid degree field that you can get some help. It's there, believe me. We work in this stuff every day. And, and, oh, by the way, where you become a pa, which school he goes to does not matter.

Right.

The percentage of people that walk into your office when a pa and ask you where you went to school before you touch my body is zero. It's zero. How many people ask where you went to school before you did sports medicine, before you stretched them? Zero. None. They don't care about your dad gum, little fancy school title? All they care about is, do you know your stuff, right?

Yeah.

I'm old. I've been to doctors my whole life. Never asked one where they went to school. John, can you. What's the range on Pa schools? John's got a PhD in higher ed. I mean, you don't have to spend a hundred grand.

Do you conceivably know you can? There's a million different schools. Does he already have one in mind?

Yeah. So we're trying to do a local one. You know, we don't we don't want to relocate. So there's like three or four he can apply to.

Okay.

And they kind of range from like 80 to 110,000.

There you go. So you've already knocked off $20,000, which in y'all's life is a year of your life of saving money. Right? So find the 81. And like Dave said, go beat the streets. Maybe he goes and goes to a community college and gets a nursing certificate first, and then they'll help pay for the transition from nursing school to Pa school. There's all different other avenues you can take to get here. But Dave's right.

Once you decide you're not going to borrow money and do it the stupid way, all of a sudden some of the smart ways start sticking out in front of you.

It's amazing.

Yeah. Scratch around and do this right, kiddo. This is the Ramsey show. It's the last call for our two night virtual event, Dave Ramsey's investing essentials. It's set for May 21 and 22, and you do not want to miss this. I'll unpack my personal playbook on investing and real estate and show you how you can feel confident in your investments, too. Tickets are 199. Snag a vip ticket and you get two sessions with a Ramsey preferred coach. You can join from anywhere. Go to ramsaysolutions.com events and get your ticket today. Doctor John Deloney, Ramsey personality, is our co host today. Thank you for joining us, America. We're so glad you're here. We invite you to drop by and see us here at Ramsey. We are about 12 miles south of Nashville in a little town called Franklin, which is absolutely fabulous. And lots of people come by the Ramsey solutions headquarters. There's a big lobby where you can have some homemade cookies and coffee at our expense. We love treating you. We like having you come in here and it smells like Mama's kitchen, not corporate America. And we want you to go through and see the stuff and hang out.

And we do the show on the glass from one to four every day, central time, Monday through Friday. And you're welcome to drop in. Doctor John does his show on the glass in the mornings a couple times a week. Coleman, a couple times a week. Smart money. Happy hours not done on the glass because they're out of control and we don't know what they're going to do next. But also in this lobby, we built a little thing right here on the glass is that we call it the debt free stage, which is where you stand to tell us your debt free story and do your debt free scream. On that stage is John and Sarah. Hey, John. How are you guys doing?

Better than we deserve.

Cool. Where do you all live?

We live up by Green Bay, Wisconsin.

Oh, very fun. Well, welcome to Nashville. And how much debt have you all paid?

We paid off just about 102,000.

And how long did that take, all told? About six years. Yep.

Six years and two months.

Six years. All right. And your range of income during that six years?

We started out right around 45,000 with a little freelance. We got up to about 140 and kind of settled back down at 125.

Gotcha. Okay, cool. What do y'all do for a living?

I am a brand and communications team lead at an IT services company, and.

I do prep at a coffee shop.

Excellent. Very cool. What kind of debt was the 102,000?

It was a credit card, a couple of loans from family, and our mortgage.

You paid off your house? You did?

Yeah.

Looking at a couple of weirdos.

Yep.

Way to go, you two. So proud of you. Very, very well done. So good job, man. Good job. So what started this whole Ramsey walk six years ago?

Well, I had been. I had been familiar with Dave Ramsey, like, 15 years ago.

We actually saw the book in a bookstore, and we're like, we should do that, but we don't know if we have enough money to pay for the book.

We didn't feel like we could afford the book. Yeah. So we kind of had a general sense of what Dave Ramsey was all about and paying off debt and those things, but weren't really on board at that point and kind of were normal. We were living, paying all of our bills on credit cards, and then thought we were being responsible by paying the credit card off every month. Of course, that is easier said than done. And inevitably, you get to the end of the month, and I was always concerned about, do we have enough money in the account to pay off the card? And towards the end of the year, often, there wasn't enough. So we'd find ourselves carrying a balance and hope for a big tax refund to cover the difference and wipe the slate clean. So this was really caused a lot of anxiety. You know, it was never. I never felt comfortable, never felt like we were getting ahead.

Cause you weren't.

We weren't.

We weren't.

And we didn't have a budget. And I tried several times to figure out the whole budgeting thing on my own, but it was just a little too much for me to figure out on my own. So, fast forward to about 2017. We had been living this way. And I kind of just got to the point where I felt like I'm tired of feeling anxious and unsure all the time. Decided to look back into the budgeting thing and ended up doing a bunch of Google searching and finding the Dave Ramsey show again. So I started binging the show and listening to other people's debt free screams. And you happened to have the ten dollar sale going on.

Now he can afford the book.

Now I could afford the book, so I love it. I bought the total money makeover. I read it, told Sarah, I think we really need to do this for my sanity at least, but I think for our future as well.

I said, fine, I'll read the book. And then I read the book and I said, I guess we can try it. Let's go.

Yeah.

So she wasn't fully on board at first, but we got going and we tried the budget. And by the way, what you say about it taking three months to get the budget right is absolutely true. It was a total disaster. Second month was pretty good. Third month was pretty good, and it's. The rest is history.

There we go. So what's your home worth?

Well, according to Zillow, which I don't know if that's entirely accurate, but probably close to 250.

Way to go, you guys.

Yeah.

Wow. That's got to feel great. Was it worth the struggle?

Oh, totally. I would do it 10,000 more times. I mean, I shouldn't have to at this point, right?

Yeah. Amen. Amen.

Yeah. Absolutely worth it.

Way to go, y'all. Way to go. Excellent. Excellent.

So what was the. What was the biggest struggle you all had as a couple? Like, both of you are showing some hesitancy. Was it because, you know, Sarah kept spending or, John, you always had a scam and an idea. Spreadsheet. What was it?

I think it was just, we didn't have the tools. We found the FBI app, and it was life changing. And it was like, okay, it goes to both of our phones. Everything's joint. We just, you know, we're all in. It's. There's no excuses to not do it at that point.

So that was really the big unlock for me, the everydollar app, to be honest, because I had tried doing budgets before with spreadsheets, and I'm just not a spreadsheet guy. And the everydollar app made it so simple, and it laid it all out for us. And that, combined with reading the total money makeover, finally, I felt like this finally is a plan that I can follow. I have steps that I can follow. I can be intentional and proactive, which is the total opposite of being reactive and anxious all the time. That was the big thing.

That was a sentence. Yeah, it was like a thesis statement. I like it. Very good. Very good. Excellent. Excellent. Good job, you guys. All right, both of you. What do you tell people when they say, how'd you pay off your house? What's the secret to getting out of debt?

Just put your head down. Keep on doing it. Just every single month, do the budget with the every dollar app. And just every single month, just like, okay, it's going to pay off in the end. And it totally does. And it's awesome. It's just crazy cool.

Yeah. I think for me, the key was the budget, and really closely related to that is being on the same page and again, having the everydollar app and being able to go through that budget every month together, make a plan for our money. I had been the one handling the finances kind of on my own previously, so this was a huge change to be able to both be looking at the same numbers and understand what we're making and what's going out and then be able to dream about it and dream together about, like, what can we do now that we actually know what our money is doing? So really making the budget and being on the same page with your spouse and talking about it and having the same dream, what's it like?

I'm looking at your kids over here, and my two kids look to be about the same age as your kids. Talk about what it feels like. As the world's getting chaotic, as schools are getting wonky, as, thank God, we're entering into another political season. Right? What's it like knowing they can't. They're gonna be all right? Like, they can't. They can't take your house. Right? When all is said and done, they're gonna be all right.

It's very reassuring. And we're very, very religious people as well, so it's like, God's got this. We got this. We're gonna be fine.

Yeah. I think it's really hard to put into words the amount of peace that that brings, knowing that we don't owe a dime to anybody for anything. And, yeah, it's just. It's just an amazing feeling.

Very cool. All right, bring them up. Let's hear their names and ages and introduce them. I want to hear this. So they've been through all this, too, no doubt. They got parents that are heroes, that's for sure.

Our oldest is Jonah. He's 14. We have Silas, who's our youngest, who is ten. And we have Ella, who is our middle. And 13.

All right, very cool. Very cool. Well, welcome, you guys. Beautiful family. Proud of you. Heroes. Well done. Very well done. John and Sarah. Jonah, Ella and Silas from Green Bay, Wisconsin. Area 102,000 paid off house and everything. Six years they did it, making 45 to 125. Count it down. Let's hear a debt free scream.

Ready? Three, two, one.

We're debt free. Yeah. Love it. Way to go, you guys. That's how it's done, boys and girls. That's how it's done. This is the Ramsey show. Our scripture of the day is John 1415. If you love me, keep my commandments. Elon Musk said, when something is important enough, you do it, even if the odds are not in your favor. John's in Seattle. Hey, John. Welcome to the Ramsey show.

Hey, good. Good afternoon. Lovely to be here.

Good to have you, sir. How can we help you guys for.

Probably the last five, six years and, yeah, it's taken a lot for me to come forward and reach out to you guys. I used to be a. Well, I had a major spending addiction, and I had gone through counseling to recover from that during my marriage and had just recently divorced and unfortunately, relapsed in those spending habits. And today I'm renting an apartment, which is quite expensive in this area, as you can imagine. And I'm sitting on top of $65,000 in debt. Three of those are lines of credit that are in a bad status that have not been paid for probably 70 days past due. And two of them are in good standing, which one is direct with my current credit union and the other is for my vehicle right now.

And what do you make?

I have. I make about 74 grand a year. And I drive for rideshare programs in the area. And I have no savings. I had had to. Before my divorce, I had had to cash out my four hundred one k and eat through our emergency savings that was developed.

How long has it been since you've seen your counselor about your spending addiction?

It's been probably almost two, two years now.

Why haven't you gone back?

So I. Because I didn't. Right now, I understand that the tools and the guidance that I was given, I understand that I need to pivot and turn around, which I have.

Hold on, hold on. Stop. You got tools and guidance. That's cool.

Yes.

But, you know, the cornerstone of every addiction recovery program is sitting kneecap to kneecap of another person and saying, do you still me. Do you see me? And you still love me. And you skip that part. That's the shame part. That's the part you got to do. You can have all the tools in the world, man. You can google how to lose weight. You got to sit with somebody. It's hard. You can google all these other things. You're avoiding that hard part. How come did this divorce beat you up?

The divorce definitely was unexpected. But I guess the reason why I didn't think that I needed to go back to the counselor is because I understood that I needed to pivot immediately when the credit lines had stopped receiving payment. That's when I. That's why I decided to completely stop touching any of those things, start paying. I got myself into this employment and consistent income and decided, okay, now I need to get myself caught up, make sure that I have a stable home, and start to see how I will take care of all of this debt, which, again, I have not touched at all since.

Okay, so let me recap just a second, and then I'll make sure I. Then we. Make sure we try to answer your question. Okay. Okay. So you had a spending addiction, you went to see a counselor, and after the divorce you relapsed. When was the divorce?

I'm sorry? When is the divorce?

Yes, sir.

It had started. It had started last year and concluded.

Okay, so since the divorce and since the relapse on the spending, you've not seen a counselor?

No, sir.

Okay. That's what I was trying to get to. Okay, so, John, there's two possibilities here. And Doctor John, the data that I have seen is old, and I don't know how accurate it is today, but we have a culture that talks about every misbehavior as an addiction. And every misbehavior is not an addiction. Sometimes it's simple immaturity, lack of self control. Those are not addictions. It's not addictive behavior. That's just other things that the general public struggles with. The last data I saw had about 2% of the public with an actual spending addiction. This akin to an OCD type behavior. Does that sound right?

I don't. I hear it very, very rarely.

Yeah, it's very unusual.

It's not in the diagnosis.

And so the. I mean, that's just, there's a twelve step program called debtors anonymous that you can plug into that has to do with debt. And it usually is full of people that have just did not have the ability to control spending for whatever reason. And so they were labeling an addiction rightly or wrongly, I don't know. But that's what I had read.

The definition of addiction, if you ask me, is it's a behavior that I cannot compulsively stop that. That I continue to do despite its nefarious consequences. And that's what this guy's doing here.

Yeah. Okay. All right. So, and if that's the case, then if you're dealing with something that is at that level and it's not simply. Stop it, you're being stupid, okay? Because addiction. Stop it. You're being stupid. Doesn't work. Okay? Addictions, you have to, they're shame based and you have to meet with somebody and get a coach, get a counselor and walk your way through it. And so that's why John's recommending that. And the fact that you've not done that is at the core. So if we're going to put you in the bucket, if you're going to put you in the bucket, or we are, this says you are an actual person who's struggling with an actual behavior type based addiction, then you need to see a counselor. You're not going to self diagnose your way out of this.

No matter how much I'm going to be honest. The language he's using is very addict language. Now I've got it figured out. I seem to solve this. I need to move this over here and I need to take care of this. Every person I've ever met who struggles with any sort of addiction always has a plan, and they just need to work the plan. It's all good and it never works.

Yeah, right. So you've got to get some help, dude. If that's you, if it's simply John's being a baby and John needs to straighten up and so forth, that's different. That is different than an addiction. And I can't tell, and we can't diagnose you on the phone, but you're using the language to John, doctor John's point of an addict. So I would tell you that to sit down with that. Now, I did promise you that I would actually answer your question too, rather than just sit here and diagnose you. But the. So how can we best help you today, John, do you think?

Well, I completely understand. I'm very open to what you guys are saying. I take full responsibility for every one of my decisions here. No doubt.

How can I best help you today?

Yeah, we're up against the clock.

What I'm looking for in parallel to that, in parallel to the help that I need to do to the addiction is that I wanted to know from you guys on your advice on how I may best tackle my debt. I had spoken to my credit union about either taking a personal loan or.

The you can't borrow your way out of it. Your first step is to get your income, your versus your monthly budget needs high. Your income higher than your basic budget needs so that you can get current. Once you're current, then I'm going to list the debts smallest to largest and I'm going to pay minimum payments, staying current on the, on the larger ones while I'm attacking the very smallest debt with a vengeance. And then of course, you've got to remove any type of debt product from within arm's reach of you. Okay. An alcoholic can't have a bourbon collection. Okay? So you've got a, you can't have a credit card collection. You can't have a access to all these things. You can't do this. So, you know, you've got to separate yourself from the access to credit lines, access to credit cards and so forth. Make it hard to get them, get current, then increase your income. And all you're going to be doing for a little while is work, which is actually cool because you, if you're working all the time, you haven't got time to spend. You're too tired and you're working all the time.

You're busy, you don't have time to do it. Some of the worst spending I do to this day is if I'm bored. And so that, that's a, it's a devil's playground. So, yeah, that's what I would do is anything you can do that's legal and moral to increase your income and then start chunking on there like a wild man. And if we can help you further, brother, you call us anytime. We're on your team. We love you. We want you to win. And I'm sorry you've been through everything you have. Appreciate you joining us. That puts this hour of the Ramsey 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. Hey, folks. Dave here. You want to hear even more life changing content from Ramsey? Download the Ramsey Network app so you can catch all your favorite shows all in one place. Like the Ramsey show, smart money, happy hour, and the doctor John Deloney show. You'll get real talk about life, relationships, money, and your career.

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