Nobody Else Gets A Vote On Your Finances

The Ramsey Show. selling author and co-host of the Smart Money Happy Hour. He's my co-host today. Open phones at 888-825-5225. Gracie is with us in Indianapolis. Hi, Gracie. How are you? I'm doing good. Good. How can we help? Well, I'm a pre-veterinary student. I just graduated undergrad with no debt. I'm taking a gap year and will be starting veterinary school theoretically next fall. and that's, depending on where I end up going, will be around $200,000 in student debt. Could be a little more, could be a little less. So I just wanted to know the best way to prepare myself for that kind of thing. Well, first I'll tell you that your field of study I think is excellent as a career choice. I honestly would coach someone to be a veterinarian before I would be a medical doctor. I think you can make more money and you have less regulations and less morons telling you what to do every day so the medical profession has just gotten out of it, it's weird and so you guys we work with a lot of vets nationwide in our Entree Leadership Program and coach them on the business side of things, we don't know anything about the medicine side of things so I'm a fan I'll start with that but Gracie you've probably been listening for more than 10 minutes and you know we're not ever going to tell anybody to go $200,000 in debt for anything, right? Yes, sir. I mean, you knew Dave Ramsey and George Campbell were going to tell you that, right? Well, I kind of expected, but I'm not sure how to get around it with the cost of tuition. Yeah. How did you get through undergrad with no debt? I've been very blessed. My parents are missionaries, so they started me working at a very young age because I was homeschooled and flexibility through them. So I actually started college at 16. I went to a private university for my first two years, realized that the cost was not worth there, moved back home. I got paid to go to school for two years, and then I ended up taking a 50-year, just the way my classes fell. So I paid, I think, maybe $1,000. I'm sorry, back up. You're breaking up a little bit. How did you get paid to go to school? your phone's breaking up try again okay i'm gonna put you on hold and christian's gonna try to get your phone straightened up we'll come back to you all right christine is in boston massachusetts hi christine how are you hi good how are you better than i deserve what's up so i'm 74 years old i'm on social security and I want to retire. I had a home investment property that I sold a couple of months ago, and after the taxes, I cleared about $900,000. Wow, good for you. Way to go. Oh, thank you. Thank you. I have a home I'm living in now that has a mortgage. It's about $300,000, but it's got significant equity, probably at least $500,000 to $600,000 equity. So, you know, I do have that. That's my only debt is the home that I'm in now. So I just need to know what I don't know what to do. I keep looking, you know, reading, and I just don't know what to do with $90,000. Do you have other debt, I mean, other investments other than this $900,000? The only other investment I have is a SEP IRA, and it's only got about $90,000 in it. Okay. So what have you been living on? I've been working. I work. Okay. What do you do at 74? I'm a lawyer. Oh, good for you. Okay. How much longer do you intend to practice law? Well, probably, like, within the next year, I'd like to retire. Okay. And what does it take you a month to operate when you retire? I'm thinking probably about $7,000. Okay. All right. Well, you'll have Social Security coming in, obviously, at that point, if you haven't already signed up for it. I have the 3,000 coming in on that. Okay. So that's three of your seven. So, Christine, I try to build a base that is just very stable and very sustainable when I'm in these kinds of situations. I'm 65, getting ready to turn 66, so I'm not far behind you. And what we want people to be is debt-free with a nest egg, 100% debt-free with a nest egg when they hit retirement because that gives them stability. And so George and I will tell you to take $300 of your $900 and pay off your house. Which reduces your expenses per month, right? Yeah, that means you don't have to have as much as $7,000 now because now you don't have a house payment. Okay. All right. And then I'm going to sit down with a SmartVestor Pro and invest the other $600. If it were to make, let's say it made average market returns of 11% or 12%, and just for round numbers, if you pulled off 10%, which you probably wouldn't pull off that much, but if you did, that would be $60,000 a year, $5,000 a month. So you're okay. That covers the gap. Remember, you've got $3,000 in Social Security. You need $4,000 over that. So that would actually cover it if you just invested that $600,000. I'd invest that $600,000 carefully and well in good growth stock-type mutual funds and let it generate you about the other $3,000 or $4,000 a month that you need and leave the rest of it in there for growth. Don't take all the growth out. Did you say stock-type mutual funds? Is that what you said? Yeah, growth stock-type mutual funds. Okay. And what I want you to do is to learn about that so that you get very comfortable with it. Don't do it because I said do it or George said do it. Sit down with a smart investor pro. You can find them at RamseySolutions.com. And, George, they're going to have the heart of a teacher. Yeah, once you're actually understanding what's going on, you see that money sitting there, you're not going to be fearful and jump out, which is what happens to a lot of people who are DIYing at this stage. Either their money is not growing fast enough to keep up with inflation, or even worse, they pull it out of the market completely out of fear. You freak out by some news headline. And so what you do is you understand the investment. And so there are mutual funds that are more stable and have a steadier growth track record over the last 50 years than that house you sold. Neither one had a guarantee, but both things you would feel comfortable with a house because homes in that neighborhood are going to go up in value. And you probably owned it a lot of years. You made a million dollars on it. So you probably owned it a bunch of years. And you were probably never really nervous about, ooh, ooh, I'm going to lose all my money in real estate. No, you've got a single-family home that's going up in value. It's kind of boring almost. And that's what you want with mutual funds is something that's got that. When you look at the chart, it charts out in volatility and up and down, up and down, up and down, about like a house does. And you say, ah, I never thought about the risk I was taking when I bought a house. But when you say mutual funds or you say growth stocks, people who haven't done it before freak out. They go, oh, God, the stock market. I always heard you lose all your money in the stock market. It's weird. You don't hear that about real estate, but it's the exact same risk. And you're betting on the exact same thing, which is the track record. Well, in-house, they're tangible. You can see them. It makes you feel better about it. The mutual funds are this invisible boogie monster. Yeah, it's the mist in the wind. Yeah. Yeah. This math is hopeful for paying off that mortgage. reduce your expenses down to five. Now you need two to pull off of that investment account. This is going to be a fun retirement. Congrats. Yeah, you've done a really, really good job, Christine. Well done. We'll be right back. We trust Christian Brothers Automotive, the official auto repair partner of the Ramsey Show. They bring clarity to car repairs and maintenance. With their digital vehicle inspections, you can actually see what your technician sees, understand what needs attention now, and what can wait so you can make wise decisions without second-guessing. Listen, when you're counting on your car to get you where you need to be, you don't want uncertainty. You want confidence. and Christian Brothers stands behind their work with the nice difference warranty. Three years or 36,000 miles, whichever benefits you more. Go to cbac.com slash Ramsey to schedule your service and get 10% off your visit. That's cbac.com slash Ramsey. 10% off, up to a $250 value. See store for details. David is in Los Angeles. Hi, David. How are you? Feel better than I deserve, Dave. How about yourself? Just the same. How can we help? I have concerns about a potential money gift for a down payment from my father-in-law, and I feel that there are strings attached. Okay. How long have y'all been married? We've been married about three years. And how much is the gift? $200,000. And what are the strings? Well, it's for a house. And initially, I heard through secondary conversations that my father-in-law wanted to have only his name on the title. And my wife and I would be paying the mortgage. And he would put the home in a trust. That was the initial plan. Now the plan is to, after the purchase, work out adding his name to the title so he can, again, put this in a trust. I'll pass. Thank you for your offer. We love you. No. Absolutely not. I don't have concerns. I have warning flags and pyrotechnics going off. Is he using you guys as tenants to pay his mortgage on a new property? No, this guy's a control freak, and he wanted to be in the investment real estate business. That's not a gift. He wanted to partner with you. Yeah. Here's some more details to it. So my wife and I, we have one child from my previous relationship. We have a two-year-old son together, and we have another one coming by the end of this year. My wife is very eager to get into a place with more space for the family because we are in the condo that she owns. Don't be eager enough to be stupid. This is stupid. Don't do it. I'm dead serious you're going to regret this you know I hear you and I try to have talks with this family and a lot of the conversations happen without my presence well I'm not signing you guys don't get to do a deal without me I'm the daddy this is my kid my wife y'all got confused about boundaries here you enter and sit at my kitchen table You talk to me. This guy's dangerous, man. He doesn't mean to be probably. He's probably actually a fairly calm person, but he's manipulative as hell. Does your wife find this strange, too? No, it's her daddy. She's like, this is great. She grew up with this crap. She just needs a shiny house. So she's gone, hey, it's new to the house. Who cares? Daddy's going to get me a house. That's all she heard. Right? Basically. Yeah. I'm sorry, honey. The first thing I'm going to do if I'm in your shoes is that you guys need to get the wheels back on your marriage to where the two of you are planning your life, not her daddy's planning your life. I agree. And so I think that may be the – I'm going to start the conversation with my wife and say, all right, the first thing is we have to be in agreement about who we're going to be as a couple and how we're going to handle discussions about things that matter in our lives. And that isn't you go over and have these discussions with your dad and then you come back and tell me what I'm going to do. That's not going to work. I'm not going to do that. I'm not going to operate my marriage that way, and I'm not signing up for this deal. So we're just going to have to tell your dad no, and you and I probably need to sit down after three years and a new baby on the way and have a reset with a good marriage counselor. It doesn't mean our marriage is in trouble, but when you go to a marriage counselor, it's like going to a coach, teaching you how to do marriage. It's a teacher. You're hiring an outside personal trainer for your marriage, and you guys got a little work to do on that because her boundaries are screwed up. okay so let me back up and tell you how i got there because this is i'm being pretty in your face but um i'm scared for you that's why i'm doing that it's bothering appreciate it so um the first thing that bothers me more than anything else is these side discussions that don't involve you and then these things are decided and they have uh she wants something. She wants a new home, and she's seeing a way to get it. So what's going to end up happening is if we don't get back on the same page, you're going to be the evil person that kept her from getting a home while her daddy tried to help her. And this is a wedge that I do not want driven into your marriage. That's what's coming. I'm afraid we're there. Yeah, as soon as you say no. Yeah. And then the second thing that's bad is everything this guy's describing, they called it a gift, and this is no more a gift than flight of the moon. He wants to own some real estate that his kid lives in and his grandkid lives in so he can control the situation. That's not a gift. It's like if he had a rental house and you all moved into it. That's what he's proposing. You've got no control in this scenario. And no, your name is not going to be on the title of my home. Period. Even if he's the sweetest guy in the world, and he's not. And even if he promises, well, one day it'll be yours. I'm sorry. Go ahead, David. Yeah, I was just asking about the legalities because he's already written a letter that says this is a gift. Well, but it's not because of the way he's structuring it. I want my name on the title, and I want it into a trust, and I want it transferred to my name after sale time. No. But the more your name is not going to be on anything. A gift is you give us $200,000 and we buy a house. That's a gift. That is not what he's proposing. So he is confused about the definition of the word. and I'm telling you man the fact that he went to your daughter and left you out of the discussion is bad chemistry that tells me that if you get in this deal it's going to be bad it's going to be really bad that's what this tells me it's not just a little bad the fact that he's doing this end run thing and man So the best advice we ever got as parents of grown children was that, especially with two daughters, the first two going out the door, Daniel was fairly low drama. He still is. Yeah. But Rachel and Denise, I mean, when they left home, Daniel was still home. We thought we were empty nesters. We didn't even know he was there because the drama dropped like 98% when the two girls left, right? So the best advice I ever got as a dad of a daughter, which is where this guy is, this father trying to give this money, is that when you walk her down the aisle, you're done. You've got to step back because you have been the man in her life, her whole life, and you've got to step back or her husband can never take the position of being the primary man in her life as long as she can run to daddy. And so, like, when Rachel got married, I told Winston, I said, this one's your problem. Oh, man. I literally said that to him, and his dad was sitting there, and his dad busted out laughing. That is incredible. This problem is now yours, my man. I'm going to be cheering for you. I'll throw food over the fence. I'll be cheering for you, but this one's your problem. That's quite the opposite of I'm going to stay involved, and I'm going to coach my daughter without my son-in-law's involvement on how I want to end up owning the house that they live in. ooh bad juju it's a lack of respect it's undermining the husband this triangulation and making him the bad guy hey babe i wanted to get you that home you wanted but you know your husband david he just wouldn't do it so i don't like any any it's like if you bought me a car but it's in your name and i have to make the payment and i go thanks dave that's crazy it's not you don't feel gifted i do not feel gifted at all i'm just driving dave's car while i'm paying his payment i don't love the good news is it'll be a real car yeah no batteries involved i gotta go to a gas station that's a whole thing no thank you you don't have to plug this one in george i want to like an easy bake oven situation i don't want to be out here trying to make my own see that's what happens when you violate boundaries you don't get to make choices anymore that's how it works see well forget i'm gonna get your nice christmas gift you lost your power No pun intended. Barbie Jeep for Christmas for you. You can charge it up. David, please, honey, sit down with a good marriage coach, and you guys work on how to deal with things in your marriage, and that coach can teach you how to gently set your father-in-law to the side, and he's not going to like it because he's not used to being told he's not important. The End Right now, AI is everywhere, but AI is only as good as the data behind it. The best AI is built on the best data. That's why I recommend NetSuite. NetSuite is the number one AI cloud ERP, and more than 43,000 businesses run on it, including us here at Ramsey Solutions. Their AI isn't bolted on. It's built in. And it connects everything that runs your business, accounting, inventory, customer data, all in one place. Because when your numbers are connected, AI actually works like it's supposed to. NetSuite's AI helps flag cash flow problems, spot inventory issues, close your books faster, and cut down on manual reporting. If your revenue is at least seven figures, go to netsuite.com slash Ramsey for a free product tour. That's netsuite.com slash Ramsey. If you're working the baby steps and you want the fastest, most efficient way to move from debt into wealth, get aligned with your spouse and get on every dollar. And EveryDollar will coach you. We will give you a personalized set of recommendations, coaching for your situation. You will be given the same answers to your questions you would get here on the air, and we will lead you exactly through the process. You can start EveryDollar for free in the App Store or Google Play. Be sure and check it out. EveryDollar. See, the good news about this material that we teach here and have taught here for almost 40 years now is it doesn't change. We don't change it. People call every day trying to get us to change it for them, but we don't change it. And so our answers are devastatingly predictable. And that's why it's easy to put it into an app, because the answer is devastatingly predictable. It's going to tell you, don't do that. That's stupid. Or do that. That's smart. and do that right now because it's really smart. And the app's going to walk you right through the process, every dollar. Download it on the App Store or Google Play. Janet is in Detroit. Hi, Janet. How are you? Oh, I'm well. How are you, Dave? Better than we deserve. What's up? Hi. So my husband started out a side hustle in addition to his regular job, and he did fairly well, and he bought himself an $80,000 commercial building for cash on a canal, and he loves it. and he's been working really hard fixing it up. But he ended up with $90,000 in business debt in the process, and he also would like to retire within five years. And I'm concerned we're not on the track for retirement and that the expenses of the building and the debt associated could prevent us from being able to retire when we would like to. And when you say that to him, what did he say? he said he'd be willing to try and rent the building out to help with the expenses however commercial there's many vacant commercial buildings in the area i don't know if his would be nice enough to rent out i don't know if we'd run into problems with people not paying rent but i have concerns i have concerns even with that solution i mean obviously that would help and he has some inventory from the business that he started that he was wishing would have sold by now, but it has not yet. And so I'm concerned, like, when will it sell? We're still paying all these expenses. Meanwhile, and even when the inventory sold, we'd have a little debt left and we would have property tax and utilities and many things associated with keeping up the building. So how long have y'all been married? We've been married, like, close to 35 years. So how often does he go off and buy a building and doesn't talk to you about it before he does it? well not usually whole buildings and this one he did mention but i was like well let's keep it all to cash but things kind of there was a lot of expenses associated and he felt his inventory would sell and so well let's let's keep it all to cash he didn't buy but he did buy the building yes yes and so i was okay that he was buying the buildings for cash but i'm more concerned with the fact we ended up with some debt associated so the debt was used to cover expenses for the building? Because he's working on it. It was in really bad shape and he's working on it like every night. Let me try this again. Honey, I'm okay with you buying the building for cash. And then he didn't. He bought a building and renovated it and went into debt. How often does that happen in 35 years? Smaller things. He got a pickup for $3,500 once, which we still are using. It's a great It's a great pickup. So there are a little bit of things like that. Yeah. Sounds like he's always got a scheme and a plan. So what do you want to do with the building? Well, personally, I just want to get a retirement savings under control, but I realize how much of himself he's invested into the building. What do you want to do with the building? Well, if it was just me in the marriage, I would sell the building. Okay. Then why would you suggest that the two of you keep it? He is hoping to use it. It's on a canal. He loves it. He's hoping to use it both for recreation for our family in retirement, and he'd like to try and run a business out of it in retirement. But you don't believe that's going to happen? I believe that he would try and run a business out of it in retirement. My only concern is that there's a lot of expenses with the commercial building. Property tax is high. Everything's high. And I feel like it would be hard in retirement to constantly be working to keep up with those expenses. But some people do it. So I'm trying to make sure, making this call, that it wouldn't be unreasonable. You're dealing with a bunch of unknowns, and your emotions are saying sell the building. He's dealing with absolutely zero business acumen. He sucks at this because all he's doing is dreaming. I hope someday that we'll use it for the family. Oh, bullcrap. Okay? This guy's not written anything down. He doesn't have good business pro forma. If he worked for me and he did this, I'd fire him for incompetence. And you're worrying about something you don't even understand because he's never written anything down. This is all jumbled up between some business and some dream and some family use of a building on canal. that none of this is, it's all mixed together. It's not, it's jumbled up. It's not a good plan. There's no plan. It's just vague. I like the building. I wanted to buy the building. Now I'm going to renovate the building. Oh, crap, I don't have the $90,000, so now I'm in debt. Oh, now I've got inventory I can't sell. And I don't know about the expenses, and you don't either. You've got this vague sense that there's going to be a bunch of insurance and taxes, which is probably true. But we need to actually look at real numbers. Okay? This is what the building costs to operate. Here's what we can rent it for. Here's the business that we can run out of it. And if there's any space left over, the family can enjoy it. Or you have the money to eat this, so it becomes a family recreational stop. It becomes a lake house for the summer, the building on the canal. But we've got it all jumbled up with we can't decide if we're a landlord or we're running a business or we've got a lake house. and it's all pushed together so that he can live this dream that's very fuzzy and in the fog. He needs to write all of this down in a business plan and submit it to you and the two of you need to look at this with wisdom and then based on that, if you can see how you actually make money and want to keep it, fine. But just his little heart's desire is not enough to make it work. I've had a lot of heart's desire at stuff I sucked at and it cost me money and it's called dreaming and it turns into a nightmare so you have to do a business plan a pro forma and go okay if we rent out this here's what the rental rates are oh wait everything on this whole canal is empty it's going to be very tough to rent so we're probably eating this oh we've got this inventory we bought that we financed but we can't sell it so we obviously chose the wrong inventory to purchase because we didn't have our business head together on that either. I've got some of that myself in the warehouse today over purchase of stuff that I wish we hadn't bought at Ramsey, but it's inventory, and, you know, it was a dumb butt thing. So you do some of that in business, but you've got to see your way to this. This is how we're going to turn this situation into money. And if we're not going to turn it into money, here's the amount of money we have to pay for it anyway and be okay. She's worried that this is taking the rug out from under their whole lives. Well, there's a sunk cost fallacy. She's going, well, he's invested a lot into it, and he really loves it, and it's going to cause you guys to not be able to retire. So you can't have the cake and eat it, too, here. I'm guessing they don't have millions of dollars, or he wouldn't be $90,000 in debt. I'm guessing. I just hope the building is worth $170,000. His $80,000 he put in plus the $90,000 renovations, I don't know that they can even sell it for that much. So I'm worried he overbuilt. Yeah, over-renovated. He got to the party too soon. Nobody's there yet. How many people are trying to buy $200,000 office buildings in that area? He bought it for $80,000. Yeah, exactly. This is going to be a tough conversation because it sounds like he's stubborn. So A, you need to get more involved and be involved in the decisions. Your life is involved because it affects you. and B, he needs to approach this with more of a business mind than the mind of a dreamer. Dreaming is good as long as you put work clothes on it and turn it into goals and numbers. Otherwise, dreaming is not what you want to marry your daughter. Oh, Daddy, he's a dreamer. Oh, God, they're going to live in my basement. I'm all about practical ways to save time and mental energy, especially during the summer when life gets busy. 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Get 20% off annual plans at joindeliteme.com slash Ramsey. That's joindeliteme.com slash Ramsey. Jacob is in Nashville. Hi, Jacob. How are you? I'm doing well. Honored to speak with you both. You too. What's up? Yeah, my specific question for you is about the rule that vehicles shouldn't make up more than 50% of your annual salary. Wife and I, we're 24 and 25. We were recently gifted a vehicle that's worth about three quarters of our annual income. And it's about half our net worth right now. So just wondering, you know, it's hard to not think about selling the car and investing that or saving for a down payment or, you know, something else. What do you guys make? uh we currently take home about 70 a year my wife's in grad school right now though and we're anticipating when she graduates that'll go up quite a bit what's she studying physical therapy cool when she graduate um august of next year so a year plus and passes her boards and then she'll make what 70 uh 70 or 80 right around there yeah okay And you make $70,000 or $80,000 now? That's your income? $70,000, yes, sir. Okay. And so this is a $50,000 car? It's about $55,000 when I'm looking at comps online. Where did it come from? My dad and stepmom gifted it to us. She got a new vehicle, and they just kind of passed it on to us. So it was a used car that they had, and they just gave it to you? For the price that we could sell our other car for. So for $8,500, we sold ours, and we were only checked, and they gave us this. Okay. Well, there's a good argument both ways. I mean, you did not put money in it. You put $8,500 in it. Okay. So if you put $55,000 in it, I'd tell you to sell it today and get your $55,000 back out and start your life smarter, okay? But you put $8,500 in it, and your income is getting ready to double in the next 12 months, which actually makes this thing almost fit. Well, it does fit, depending on what the other car is, yeah. So, you know, given the trajectory of your income and that you didn't put money in it, if you like the car, it's fine. It's also some wisdom, what you said. But, I mean, you're tempted to go. Of course, you – what happens with your parents if you sell it? Do they get pissed? Well, part of – I wouldn't say pissed. I think part of the reason, you know, the motivation for them giving us this is we had, you know, a 15-year-old car with 200,000 miles on it. And my dad never keeps a car past an oil change. He likes new vehicles. So, you know, I think part of the motivation was, hey, let's get my son in a good, reliable car and something they can keep a little while. So, you know, they were blessing you. And his version of blessing is a nice car. Yeah. But good, reliable, that could have been a $20,000 car and you could have used $35,000 as a down payment. Yes, that's correct. And that's kind of what we're thinking about. You know, we're able to cash flow in my wife's grad school. So student loans aren't a concern there. But, you know, what is the car? Or mine. It's a 2023 Toyota 4Runner. Okay. Yeah, would you buy a $20,000 4Runner if you sold it? You know, it's funny. The one we sold was a 2015 4Runner with 200,000 miles on it and same trim level and everything. Wow. So we could definitely find one. Yeah. You definitely like the Toyota product, doesn't it? It's a good car. We're happy with it. It's a good car. It'll last forever. And you guys are debt-free otherwise? You got savings in the bank? Yep, we're on baby step four, except we're not doing a 15% because we're cash-flow in grad school right now. Okay. As long as you and your wife, and for that matter your parents, are aware that from this point forward that you will not be owning vehicles using the same pattern as your dad, changing every time the oil's changed. because that will keep you broke. It will steal your wealth. As long as you say, I'm not going to intentionally go buy a car with cash or otherwise ever in my life. It's not my plan. This just is something that happened to me. It wasn't something I sat and dreamed about and did something stupid. Okay? It was more like, in other words, this is a one-time, good-time thing. You're never doing this kind of thing again because the next time it will probably be up to you to do it, right? and you would never do it again. If the two of you, and even for that matter, you explain this to your dad someday, I'm never doing this again. I took this only because it was a gift. So because it was a gift and didn't cost you anything, hardly, $8,500, and because your income is going to double in the next 14 or 15 months, I'd probably keep it. What do you think? Yeah, I mean, if your income was like $50,000 a year household, this is just too much car for your life, and you could be doing way better with it. But with your income, this is not a ridiculous car that you would never own. It's not a Lamborghini that you're paying crazy insurance on. Yeah, that's a good point. It's a reasonable vehicle. If they hand you a $250,000 Lambo, I'd be telling you to sell it. Sure. Just the maintenance repairs on it. But a Toyota, you're like, all right, that's going to last a long time. I'll cost you $55,000 to keep the Lambo running. Exactly. So I would take this as a nice one-time blessing. And it might take you longer than you wanted to to get that house now. Yeah, don't use this as a way to adjust the way you look at money and vehicles, though. This is an aberration. It's a one-time event, okay? As long as it doesn't shift the way you're thinking. In other words, you called me because it doesn't line up with what you believe, right? It doesn't line up with what we believe, and you wanted to ask about that because you somewhat believed it. If you weren't worried about it, you wouldn't have called. So as long as you stay on that side of the fence, I'm good. I just don't want this to go, well, you know, I did it that one time and it works. I'm going to keep doing this thing for them. No, no, no, no, no, no, no. You don't use this as the rationalization to go into the next deal. Well, the good news is if they sold it, next oil change dad's got, they're getting a different car. Hey, just keep doing this. You'll be wealthy in no time. We never buy tires. We just trade the car. I mean, you've got to be wealthy enough to absorb that kind of hip if you're just flying through cars like that. Man, it's just... And the problem is, I just love cars. I know. I'm just such a car geek. I knew you were going to be... They hit yourself. Here's the interesting thing. You know, when we talk to Baby Steps Millionaires and say, okay, what's your net worth? 1.7 million. What do you drive? Toyota. What's your wife drive? A 15-year-old piece of crap. Would you get your wife a good car? You know, that kind of thing, right? But we hear that every time. The wife drives an old piece of crap and the guy's got a Toyota. Why punish yourself? Or vice versa. Yeah. The Toyota always comes up, though. I think it is the most driven car by Baby Steps Millionaires. You know, a nice Toyota, a good one, but not some worn-out piece of crap. And then Honda was up there. Lexus is up there, too, with Millionaires. Yeah, we hear them. We don't hear Lambos. Man, Kelly is in Los Angeles. Hi, Kelly. What's up? Hi. Hi. Thank you for taking my call. Sure. How can we help? Okay. So I just inherited some savings bonds, Series I. They were both issued in 2003 and 2006. So I can pull them out if I want to and disperse them. Originally, yeah, just cash them out and pay off my debt. Yep. How much is it? $33,000 now. And how much is your debt? $25,000. And what do you owe the debt on? Credit cards. Okay. So let's pretend that you didn't have any debt. Would you go borrow money on a credit card to buy an iBond? No. Okay. I didn't know because I've been listening to you since February, so thank you. You have turned my brain around. But I've been listening, trying to see how you feel about those savings bonds. I'm not mad at them. My granny used to give them to us, and we would cash them in and put them in mutual funds for our kids' college. And she would say, how are those bonds doing? And I said, great. That's true. Technically true. Okay. Because, like, I would love to pay off the debt. Like, since I've started doing the baby steps, like, I'm just so excited. I'm so excited. And you're going to cut off the cards, right? That's the big part. You're chopping the cards up. What do you mean? You have to cut them up. They're done. They're long gone. Oh, good for you. Oh, you're rocking it, Kelly. I love you. They're done. They're so done. That's so cool. So where did the I-bonds come from? My parents. I inherited them. They passed away? Yeah. I had to go through probate and everything. It was miserable. I'm sorry. Yeah, so anyone out there that's listening, like, do a living trust or at least a will. Definitely have a will. You can go through a probate like a hot knife through butter if you just got a will. It's not a big deal. But if you have to go in there and the judge has to think about everything, it's not good. Don't let judges think. I bet they're smiling. They're slow. And you become debt-free, too. That's pretty cool. It's a nice legacy. Very good. Good for you, Kelly. Debt-free. Never use a credit card again the rest of your whole life. 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Sign up for your $1 per month trial at Shopify.com slash Ramsey. That's Shopify.com slash Ramsey. Shopify.com slash Ramsey. Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. Jessica's in Phoenix. Hi, Jessica. How are you? I'm doing well. How are you guys? Thanks for taking my call. Sure. What's up? Yeah, so my husband and I have been in our home about 14 years. We have a manufactured home on an acre and a quarter of land, and we've just came into the situation thinking that we would always build a home there one day. I ended up staying home with kids, and we haven't done that. It's been a blessing to us. However, we are trying to just plan ahead for what our next steps are as the home is definitely in need of maybe a second overhaul of repairs, but we're not sure we want to dump that kind of money into it with knowing that we're not going to see that return. One more detail about the home is that it is on its second location, which at 24 years old, we didn't realize how much of an issue that was for financing. So to list the home would be difficult to find a buyer. Of course, it just takes one, but it would be a private financing situation. So just a little unsure what to do there. Do we stay? Do we go? We have quite a bit of equity. There's so many things it can be when you describe it as a manufactured home. So is this sitting on a foundation? Yes, it is. It is above ground, but, yes, it is secured. and all of that. Yeah. So when I drive up to it, I think double wide. Yes, you would. Okay. All right. And so when the buyer drives up to it, they think double wide. And so it's gone down in value while the acre has gone up in value. That's correct. Yes. And we also would need probably a cash buyer, which would also bring our price down. What do you owe on all of this? We owe about $70,000. And what is the one acre worth? So in our surrounding area, the same acre and a quarter is anywhere between $250 and $350. Okay. All right. And have you had any suggestions on what you would list the property for? Yeah, we've heard some pretty low, like just list it for $350. But then we've also heard start at $500. I've heard a lot of stuff, but I'm asking what the actual value is. What I'm trying to figure out is it sounds to me like the trailer is probably not worth much. Right. And we have remodeled it. If you picked the trailer up and sold it, what would it go for? So this was maybe five years ago before I resigned. We were going to go trade it in or sell it to a private trailer park, and they were offering us about $40,000 then. Okay. So if you could get $20,000 for it and get $350,000 for the land and separate the two, you're probably going to end up more that way than trying to get someone to finance a trailer on a $300,000 piece of dirt. Right. And we have had homes on our streets similar in size, also manufactured homes, sell between $5,000 and $6,000 within that range. Similar age and condition? Similar age. Ours is smaller. How did they sell theirs? 1,400 square feet. So the manufacturing can be financed conventionally an FHA. However, ours has been, we did not know at the time, but it's on its second location, which takes away the option of conventional and FHA financing. Okay. So you've lost that ability. So you can't really compare your situation to the $600,000 situation. You've got more of a $400,000 situation. True, yeah. Okay. So you're experiencing what people that buy mobile homes experience, that they go down in value dramatically. And it has. And you basically have consumed the living quarters while the land went up. Right. And we did close at 105 when we bought it. So, you know, we're not. No, listen, I don't want you to believe that narrative because you still got screwed. You closed at 105, but the land is the only thing that's saving this and making it feel okay. If you closed at 105 and the trailer was worth 10, then you would really be experiencing what has happened. Right. So, no, the manufacturing housing was not a good investment. If you had bought a home for $105,000 or $150,000, you'd be sitting at $700,000 right now. So, no, it's still not a good idea. We don't want to repeat this, nor do we want to endorse this, but we're still here. So I think I would get in touch with one of our Ramsey-trusted real estate agents to see if they know some financing in the Phoenix area for this that can get the value up. Otherwise, I'm going to separate the two, dump the trailer, and sell the land. I think it's going to be tough to find that buyer in that sweet spot who wants it. I was not aware of what she was saying, that FHA would not. Second location. The moving the trailer wants makes it not work anymore. Is it just too much risk for the owner? No, I don't know. I don't understand. I did not know that. I knew FHA would finance them in some cases if you put them on a permanent foundation. That's why I was asking about that. Yeah. And the piece of ground goes with it. Obviously, they don't finance them in a trailer park. But, yeah. The good news is the land will sell. Yeah, the good news is the land is going to be your financial salvation in this. But the dirt would have went up in value with or without a trailer on it. Yeah, if you just bought the dirt, it would have gone from, you know, probably whatever you paid. But you probably didn't pay anything for it. Sounds like you got a great deal on the dirt. But, yeah, that's the thing. But you need to keep those things very separate in your mind as you do the analysis and tell yourself the story of what has happened. And it sounds like you need to separate them in order to sell it. But get in touch with one of the Ramsey trusted real estate agents. Call a couple of them and ask them if they know anything about mobile homes or manufactured housing in your area and so on. So, guys, there's a real spectrum of things when you say manufactured housing. If someone's saying that to you, let me walk you through that. There's a trailer, single wide, double wide, with a couple of axles, and they roll it down with a wide load sticker across the back down the highway, and they set it on a piece of dirt, and you put it in a septic tank, or you hook it to sewer, and you build a concrete foundation under it, and you're living in a trailer. That's going to go down in value faster than a car that you sleep in, because that's what it is, a car you sleep in. It's a horrible investment. Well, it's all we can afford. It's a horrible investment. You'd have been better off renting and saving your money to buy something that goes up in value. Don't buy those. Okay? And my buddy that owns a manufacturing company, one of those, gets mad at me. He's like, don't tell people that. And I'm like, hey, when they quit going down, I'll quit telling them. Okay? They go down. Then there's manufactured housing that looks like a trailer, but it's not quite. It's like big sections, and they bring it in, bolt it all together, and it's modular and that kind of thing. It's a step up. And it still is going to go down in value. The reason I asked her the question is, from a real estate agent's perspective, and I've been a real estate agent since 1978, when you walk up in the front yard and you look at it, if you think trailer, or if you think a builder built this, that's the two different things. If you think a builder built it when you look at it, you're probably going up in value. The last end of the spectrum on manufactured housing is, there's actual factories that build wall sections. They put them on an 18-wheeler. They deliver the wall sections, the floor sections, the pre-engineered trusses, the tree-engineered floor systems with the heat and air built into it, the whole thing. And they put it all together. And when you're done, it's basically a stick-built house, and it has nothing to do with the trailer world. Those are perfectly fine. Let me tell you what I get asked all the time. When should I get term life insurance? How much do I need? Is it affordable? Those are the right questions to be asking. So let's take a quick review. The fact is, term life isn't a baby step. So if anyone is dependent on your income, you need to have 10 to 12 times your income in life insurance now. And most people are surprised by how affordable term life really is, even if you're not in perfect health. Look, I understand the hesitation since most insurance companies make it more of a hassle than it needs to be. Not at Xander Insurance. They're not an insurance company. They're a broker that works for you. That means they'll shop and compare the top term life companies to find the most competitive options on the coverage for your family. For almost 30 years, I've recommended Xander for straight answers, competitive rates, and coverage that actually protects your family. Call 800-356-4282 or go to Xander.com for a quick and easy quote. That's Xander.com. Stacey's in Chicago. Hi, Stacey. How are you? Hey, I'm good. How are you doing? Better than we deserve. What's up in your world? Hey, so we have a situation where we've got our oldest daughter heading to college. She's going to be a college freshman this year. And we have done a pretty good job saving for retirement, but we have done a horrible job saving for our kids' college education. and we just kind of thought we had more time than we did and now we're being smacked in the face with it. So we really don't have anything saved for her for college. So with her coming up right now and we have two more coming up after her, I'm just wondering what the best way to approach this is. I just was listening to some of your previous calls on people who are tens of hundreds of thousands of dollars in student loan debt and I'm really just trying to approach this in the smartest way that we can. Good for you. Good for you. For her? What's your household income? Or just a little over $200,000. Good. Okay, I'm going to ask you a real practical question, and it is a leading question. I'll warn you ahead of time. Okay? Okay. Why is she going to college? What does she want from college? She is going to be majoring in mechanical engineering. She has a lot of motivation, a lot of drive, a lot of ambition. Excellent. Excellent. When we did the study of the largest study of millionaires ever done, we studied 10,167 of them. The number one career of people that become millionaires is engineer. Wow. Well, my husband's an engineer, too. Okay. And you guys have experienced that because you have a wonderful household income. Yeah. All right. And it's just him. I don't work out of it. I applaud the career choice. Okay. Now, the next thing is this. No one except her sorority sisters care where she graduated from college. Absolutely. No mechanical engineer has, well, no, less than one half of 1% of engineering jobs are awarded based on where the engineer went to school. Absolutely. I agree with that. Okay. So what we want to do is we want to get the engineering degree by spending the least money possible. Yes. Okay. So there's a series of leading questions because we're taking you somewhere, Georgia, and I do this all the time. So what that means is we may go to community college for the first two years and just get the basics out of the way because there's no engineering in the first two years anyway. Well, so the really great thing is our high school actually offers a lot of dual enrollment credits. Great. So she's going into college with a lot of credit already. Oh, so she can blow off a lot of her freshman year. Yes. Good. Well, yeah. She just leapfrogged some of that. Good, good. So is she already heading into college? Is she already chosen? She is, yes. She's going to Iowa State University. So there's a state school. It's not our state. But she's paying out-of-state tuition? Yes. Why? That's where she chose to go. She doesn't get to choose. She doesn't have any money. Well, that's true. If I'm paying for dinner, I'm going to choose where we go to eat. And I'm not going to endorse paying something because we drove across the state line. There's no value in having driven across the state line added to the quality of her education. Did she tell you why she wanted to go to that school? Well, there's lots of reasons. It's a very good engineering school. A lot of friends are going there. She felt comfortable there. She didn't get into our state school. They have a very competitive engineering program, and she did not get in there. So we were kind of forced to look out. Okay. So as we have studied the student loan debacle over the years, I actually did a major award-winning documentary on it called Borrowed Future. We find the number one cause of student loan debt is college choice. That's why we're coming down hard on this. Okay. In other words. I don't think we're in an excessive amount. Okay. So what is the tuition out of state for Iowa State? Per year, we're looking at about $30,000. Okay. because average tuition in America right now is $12,000 for in-state. Oh, my gosh. Okay. So we need to do some research, and we need to do some thinking, because otherwise this kid's going to end up at $150,000 in student loan debt. Right. Because her friends went there. Because her friends went there. And nobody gives a crap where her friends went. They won't even be her friends in a decade. They may not be friends in a year. Yeah. Yeah, college choice, college choice, college choice, college choice, and then do as much free stuff as you can do. She's done a good job as a high schooler taking some dual stuff where she got a lot of credits. That's great. She can jump through a lot of her freshman year. That'll save you a lot on cost. But if I'm paying for it, we're going to go to the least possible expensive place to get you this degree. And really, your little feelings don't enter into it with me. I'm sorry. And I'd have her working part-time. You can tell your therapist about your feelings. I'm paying for this. I love this stat, Dave. Studies show students who work 15 to 20 hours a week while taking classes have a higher GPA than those who don't. That's what the research shows. So if you're scared your kid's going to flunk out of class because they have a part-time job, the opposite is. They're working, and they just don't have time to play beer pong. They're more focused. They actually learn discipline and schedules. So I'd have her working, applying for scholarships. I know several people who got a degree in fraternity and one that got a degree in sorority. Do you have time for that? Meaning they never graduated. They were laying under a keg of beer. And so, you know, this is, we all know these people. I mean, people that had a bright promise. And I don't think that's going to happen to Stacy's daughter. No, not for a mechanical engineering. No, this kid, this kid's actually a smart kid. But we need to add to her smart wisdom. And wisdom is we go where mom and dad can pay for it. They make $200,000. You're going to be working. You're going to get scholarships and college choice. And that's the formula when you're broke for your kid to go to school. And then if you can and you want, cash flow is what's left. Especially what that means is I don't think you're going to do it because of the way the sentences were formed in this conversation. But if I could talk you guys into doing something, I would disappoint her. and withdraw from Iowa State at $30,000 a year. And I would find a school you can afford because you can't afford $30,000 plus room and board. So we're at $60,000, $50,000 or $60,000 now out of your $200,000. Oh, and you've got two more coming on. What are we going to do with that? So we've got to have a plan here, and the plan is college choice, college choice, college choice, which includes two years of community college and get the basics out of the way for free or close to free. And also add to it scholarships, scholarships, scholarships, scholarships. Buy Christina Ellis' book, How I Got $500,000 to Go to College and Free Scholarships. Yeah, she did it. And she's out there talking about it right now. And, of course, also work while you're in school. You put those things together, people can go to school with no student loan debt. And if you come out with a degree in mechanical engineering with no student loan debt, you're going to own the world in about four years. It's pretty crazy the advantage that this disappointment could give this kid. Otherwise, she's going to spend the first four years after she gets out of school paying because she went to school where her friends went. and that's going to stunt her adult growth where she wants to buy a house and have a family and do all these things and she's going to feel trapped because she's got $150,000 to pay off. Exactly. So that's tough. It's a good reminder, though, that parents are not obligated. I'm all about disappointing people for their own good. It's like what I do for a living. So we're going to love you and I want the 10-year-old, 10-year-from-now version of you to think that we were mean to you because we love you. We disappointed you because we love you. and because we want good things for you. And I really don't care about your childish little emotions. You know, I'm just oblivious to it. I'm old and grouchy. And so I just want you to win. I just want you to win. I want this kid, man, the number one career of millionaires. And she's good at it. And she's smart. And she's the oldest child. And she's going to set the pattern for the next two. and you've got the decisions you all make right now in the middle of all this and all the emotions that you all are all going to go through are going to be worth every bit of the arguments and the fights and the tears and the problems and it's just a hot fair. Well fair is where the tilt and the cotton candy is There not a fair Sorry If you're waiting for the perfect interest rate before you buy a home or refinance, that moment may never come. That's why people should talk to Churchill Mortgage, because rates move every day. And when rates drop, buyers flood the market, which means more competition and higher home prices. 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Well, we wish we could get to every call and every question here on the show, but there's only so many phone lines and so many minutes on the air. If you've got a question, head over to our website. Use Ask Ramsey. Ask Ramsey is our free AI tool that's built and trained only on Ramsey content. So there's no TikTok or Reddit bullcrap in there. You're not going to get any advice except what you would get here. It's three years of this show dumped in there. All the books we've written are dumped in there, and the thousands of articles that we have written that align with what we teach are dumped in there. And consequently, the thing answers the questions. It's almost as smart aleck as I am. And so that's the way AI works, if you didn't know. It can only regurgitate the data set that it has. That's the only ability AI has. And so if you limit the data set, you limit the answers it gives. And these are only Ramsey answers. So you're safe. You don't have to worry about all the other stuff. Ask your question today at RamseySolutions.com or click the link in the description if you're listening on podcast or YouTube. Ask Ramsey. Grand Rapids, Michigan. Christopher is calling. Hi, Christopher. What's up in your world? Not much. I just appreciate you taking my call. So my question today is I'm starting a brand new career, trying to rebuild my life pretty much from the bottom down up. I just discovered your show and your information and started going through some of your books. But I'm in a significant amount of debt and a very low income at this point starting a brand new career. I want to dig myself out of debt with a very limited income. Okay. Why, if you have a new career, did you choose one that has a limited income? So I went into truck driving, and I got my CDL, and when I was looking into the careers in my area, I was looking at bringing home $65,000 a year, but with my weekly pay and child support coming out, I'm bringing home significantly less than what I expected. You're single? I am single, yes. Why don't you drive over the road and make three times that? That's what I do right now is I'm an over-the-road truck driver. Well, you're not making $65, then. No, no. I'm at like $39 right now. No, you make more driving over the road, not less. Yeah, so I'm an over-the-road truck driver just like first month into truck driving. Yeah. And I get raises every three months. How much are they paying you a month? So right now, like, I bring home after child support is taken out. I make about $300 to $500 a week. How much child support is coming out? $883 a month. I just got that lowered from $1,200 a month. Okay. You need to go shopping on your career because you're not being paid enough to drive over the road. Over the road, you should be making a lot more than you make. Yeah, and, like, that's kind of like what I'm seeing right now. Yeah, like, that's the lowest over-the-road price I've heard, and I don't know when. Yeah, and, like, I went with Omega Carrier because I didn't have the experience necessary to get the, like, local jobs that are paying like 65 to 85 to 100k a year. I'm sorry. I'm having trouble communicating with you. Over the road makes more than local. Most over the road truck drivers we talk to make north of 100. Yeah. And you're making like 30. Yeah. Why? Even entry level, you should be making more than that. Not entry level. I mean, this just doesn't even add up. How old are you? I'm 36. Okay. All right. And how much debt do you have, honey? Uh, 75 K on what? Um, so, um, I owe my mom $20,000. I have $25,000 in student loans. I have a car that's way too expensive. It was a horrible decision at 34,000 and then $8,000 in credit card debt. Great. So when you, when will the car be sold? Um, I'm looking into how to sell it right now because I can't afford the car. Obviously, the car was a horrible decision. Yes. How far underwater are you? What's it worth? It's worth $22,000 to $25,000. Who said? Just looking it up on Kelly Blue Book. For private sale or trade-in? Private sale is like $22,000. And then trade-in is $22,000. And then private sale is $25,000. That's not right. According to. Okay. All right. So you're $9,000 in the hole. Who do you owe this $34,000 to that you got screwed by? Ally Financial. Oh, God. So you're paying 15%, 16%, huh? Yeah. It was a really bad situation. I really regret it. I wish I would have started listening to you much sooner in life. What's the car? It's a 2023 GMC Terrain Denali. Yeah, dealer. They completely set you up and knocked you down, man. Oh, God. All right. So what do you owe your mom $20,000 for? Because when I was working at a nursing home, and then, like, I'll be honest, I have some mental health issues like bipolar, PTSD, and something like that, and I was starting a new career at a new nursing home, and I got behind on my child support, and I was in enforcement. So she helped me out with that, and then I got caught up with my child support. And I'm currently with my child support. You didn't pay for like two years. No, it was more like six months. I thought it was $800 a month. It was $1,200 a month. Okay, well, six months times 12 is not $20,000. And I think I had like 1,200. Did you serve in the military? Law enforcement. Law enforcement. And that's what your PTSD is from? Yes. Are you on any kind of a disability from that? No. I've been really just working on trying to like really just get on my feet by working. Okay. All right. Here's what I'm going to do. You've got a lot going on, honey. and I'm going to hook you up with one of our Ramsey coaches that we have trained as a gift. We're not going to charge you a dime for it, all right? Okay. And what I need you to do is I need you to get this car sold as soon as you possibly can. You're going to have to find the $9,000 to cover the hole you're in because Allied has completely screwed you, honey. And you've got to get rid of this. The faster you get rid of this, the lower your pain is going to be. So let's get rid of it really, really fast. And then the second thing I want you to do is I really want you to study over-the-road truck driving out there that go online and start seeing what people are paying for it. Because I think you're being dramatically underpaid there. Unless there's something I'm missing in this equation. So I need you to get your income up and get rid of that car and then develop a game plan on each one of these elements that we're talking about. And you'll be able to walk that through. But I need somebody to hold your hand and do that more than we can do on a phone call, okay? And cut up those credit cards if you still got them. Yeah, for sure. Because that's just going to allow you to go further into debt, which is going to make the difference. When you're on the road and, you know, you get something matching up just right, and you go in and you buy whatever you want to buy to feel better that day on a credit card, it's not a good idea either. So you've got to clean those up. George is exactly right. So you hang on, and Christian will pick up. We'll hook you up with one of our coaches as a gift, because it sounds like somebody needs to hold your hand a little bit and help you get straightened around on a couple of these things. but the two big things you've got to do you've got to get rid of this car three things you've got to cut up the credit cards you've got to get rid of the car and we've got to get your income up and the first place i'm going to look is i don't understand why you're so dramatically underpaid for what the typical over-the-road driver is making right now so i want you to understand what's going on there i there's something that i'm missing in this puzzle piece here in this phone call but it's out there somewhere i'll be a new man if you can get rid of that car and get your income up, you're going to be able to breathe. Now we can knock out the rest of this debt in a reasonable amount of time and get our life back. And in the process, as you're with your therapist working on PTSD and bipolar, work on decision-making frameworks with them, how they help put new pathways in your brain in place to help you make quality decisions because you've been bumping around between some bad ones lately. Hey guys, healthcare is one of the biggest stress points in your budget. It's confusing, and most of the time it feels completely out of your control. But there is a better way to handle it. Christian Healthcare Ministries isn't health insurance. It's a health cost-sharing ministry where Christians share each other's medical bills. And it's not a new idea. THM has been around since 1981. It's predictable and proven, and they've shared over $13 billion in medical bills for their members. Plus, you get more flexibility. There are no network restrictions, and you don't have to wait for open enrollment. Now, let's talk about how CHM helps your budget, because programs start at just $115 a month, and many families save hundreds of dollars a month compared to traditional options. So if you are tired of feeling stuck, check out Christian Healthcare Ministries. Right now, CHM is offering new members a 50% credit towards their first month of membership. Go to chministries.org slash budget and use promo code RAMSEY. That's chministries.org slash budget and use promo code RAMSEY. The Ramsey Show Question of the Day is brought to you by YReFi. YREFI, missed private student loan payments, put you in default, and they can keep your budget stuck in neutral. YREFI helps borrowers explore low fixed rate refinancing and payments based on what you can afford, so you can start moving forward. Visit YREFI.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. Might not be in all states. Today's question comes from Stella in Kentucky. I entered a sweepstakes for a cruise to Paris and the French countryside, and to my surprise, I was the winner. The only cost to us is airfare and hotel stays before or after the cruise. My husband and I didn't have a honeymoon, and this feels like a once-in-a-lifetime opportunity. The holdup is we're in baby step two and don't have any extra savings for travel. Friends have suggested getting a credit card just for this trip, but we both feel uncomfortable with that. Part of me knows that I should just take the win as a cool thing that happened, but not financially smart to partake in, but the free-spirited side of me is devastated thinking about losing this opportunity. What should we do? I don't love being a dream killer, but I'm about to kill the dream, Stella. I would not go on this cruise because it ain't free if it costs you $10,000 in airfare and hotel stays while you guys are in debt. That's one man's take. Yeah. So the great news is France will still be there. I hope so. and you can go later. They're not going to move it. It's still going to be there. There will still be cruises. And better ones than this one. This one sounds like a setup. Ben is in Nashville. Hi, Ben. How are you? Hey, Dave. I'm doing well, and I'm really excited to talk to you. You're the man. You too, sir. How can we help? Well, I'm 28 years old. I just got engaged. Yay! When are you getting married? Well, that's kind of the big question, right? We really want to get married, and I'd love to do it as soon as possible. Good. But I don't know if I should get debt-free first. No. Or drop in the right foot. No. We never tell people to get out of debt before they get married, ever. Or have babies. Right. Even if the wedding could cost, even on our budget wedding, we're kind of looking at maybe $10,000 or $15,000. Yeah. So what? That's reasonable. You're not getting help paying for it? You got to pay for it? I got to pay for it, and that's what's making me a little nervous. Okay. What do you make? So this year I'm in sales, and I'm going to be making – I'm on track to make about $100,000. Cool. What's she make? She makes just about like $30,000 right now. She's serving. She's a waitress. And how old are you now? I'm 28. She's $25,000. Okay. And how much debt do you have? Well, it's consumer debt. So I've got about $18,000 on the automobile loan, and then I've got about $7,500 in credit card debt, which I am fixing to pay off actually next week. I've got my bonus check coming in, $7,500 in debt, and the bonus check will be around $9,000. Awesomeness. Very cool. And then you've got a car payment left, and what debt does she have? Her debt's a lot smaller than mine. I mean, she just owes a little bit more on her car. So hers is about, I think, like $1,500 that she owes on her car. And we wanted to tackle this credit card debt first and then take care of her car loan and then start chipping away at the principal and mine. Okay. Okay. Well, what I would do if I woke up in your shoes is I would pay off the credit card debt and her car debt with your bonus check. I don't usually have you pay somebody's debt that you're not married to, but it's $1,500. It's not the end of the world, so we're done, okay? Right, and I love her, man. I'm excited to marry her. I still wouldn't pay her debt. If it was $15,000, the answer would still be no. Okay, so. Okay, right. And then I would just pay your car payment, and both of you get on as tight a budget as you can get on, and stack cash for the wedding, and set your wedding budget at $10,000. And when you've got $10,000, make it work. And you should do that by, like, September. Okay. Yeah. Do you think that just, like, setting aside, like, bonus checks and stuff? I think you make $100,000 a year. Shut up. Quit going to reference. Right, yeah. What are your expenses as a single 28-year-old guy? Well, rent right now is about $1,600. She's making $30. Is she living with her mom and dad? No, she does live with me, which I know is against the Ramsey rules. But stack cash. Each of you stack cash as high as you can stack it as fast as you can. With $130 coming into the two of you, you should come up with $10,000 very quickly and have a budget wedding, and it's going to be awesome. Yeah, I mean, what do you recommend? Because, you know, I think with the car... Wait a minute. I'm going to change my mind. I'm going to change my mind. I'm sorry. I got new information, and I didn't process it fast enough. That they're already living together? Yeah. Get married this weekend? That's the one. I knew it. Dave loves a little courthouse wedding on a weekend. And then I want you to have a celebration that costs $10,000 in September. Okay. But, you know, that's actually what we talked about. Wait a minute. What are you saying, Ben? Well, that's something that we've talked about. And I've got to say she looked really upset when I kind of said maybe we could elope. I think she just has that dream of walking down the aisle with her family. She moved in with you. Yeah. This is not exactly a white dress we're walking down the aisle in. Okay? Right. We gave up the little Barbie and Ken wedding a while back when we decided to shack up. Y'all do what you want to do. But there's no way. I'm getting married this weekend. If you're going to get married, you're going to do this, and I think you are. That's what I would do if I woke up in your shoes. Because you're playing house, and the longer you play house, the more trouble you're going to get in. And you're going to get yourself in all kinds of messes. And anecdotally, I found that people that are living together before they're married, it takes them so long to actually end up getting married. They can't seem to get off the ladder. They just keep painting. Just an eight-year engagement. Just get off the ladder. God. Yeah, it's just, yeah. When are we getting married? I don't know, someday. We're not going to have the perfect wedding. Meanwhile, we're just acting like we're married. Yeah. No, I'm sorry, Ben. I have very little patience for that. I'm sorry her little girl dreams disappeared. But she gave them up a while back. She signed up for a different trip than the one she had when she was eight years old in her head. So, yeah, I, you know, now we're down to making adult decisions with adult money and adult situations. So that's what I would do. You guys do what you want to do, but I think you can have your celebration with $10,000 and not have your car paid off. And no, we don't make people get out of debt before they get married. We want them to be in agreement that we're not going into debt going forward and in agreement on how we're going to handle our money after we're married before you get married. But, you know, we've had people call up and the girl says, well, he says he won't marry me till I pay off the debt. And I'm like, yeah, he gets you a different boyfriend. I would not marry him. Yeah. And so, you know, you get to give me a task. That's not how this works, buddy. So, you know, that's not Ben's situation. But we get those all the time. So we don't do that. And the other one is the babies. You know, babies don't cost as much as everybody talks about. They do cost money. And you do need to be responsible. And if you're broken on welfare, you don't need to have 16 of them, okay? But deciding to have a baby and you've got a $27,000 student loan, have the baby, for goodness sakes. You can get out of the student loan debt. Don't wait around on babies. Have babies. Babies are the best things you can do. And do that after you're married, by the way. Hello. There's a success sequence that we talk about here on the show all the time. It causes you to win financially as well as in a whole bunch of other areas of your life, relationally and everything else. So, Ben, the bad news is we're not going to be real popular with your fiancé. The good news is we did tell you to get married now, so maybe she'll like us a little bit anyway. And we didn't tell you to wait to get out of debt to get married. And we didn't even tell you to sell your car. That was very nice of you, Dave. I was waiting for it. I thought George was going to jump in. I actually was kind of like, if you really love her, sell the car. If you really want to be debt-free so badly before you get married, go ahead and sell this car. But we're also saying you don't have to be debt-free. You just have to be in agreement on it. And then as soon as September's done and the celebration is done of the wedding that actually happened back in July, then we lean in on the car and we pay for it very, very quickly. And that's the plan. He's in Nashville, so you get married this weekend. Come by next week. I'll give you a wedding gift. How about that? Sure. Come by the studio. What are you going to do? Give him a copy of your book? Yeah, I'll give him all your stuff. Whatever he wants out there. All my stuff. Yeah, it's on your tab. We'll give him some of yours, too. Fine. All right. All right. Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. I'm Dave Ramsey, your host, George Camel. Ramsey, personality is my co-host today. Jessica is in Raleigh, North Carolina. Hi, Jessica. How are you? I'm doing well, and you? Better than I deserve. What's up? So I am a single mom of three, ages 13, 11, and 8. I have my children 100% of the time. and their dad passed away last year. So I started receiving like Social Security funds for them, death funds for them from their dad's Social Security. And so I changed jobs and careers last year as well. So I doubled my income, making around $40,000, $45,000 a year to bringing home close to $90,000 a year. How old are you? I'm 38. What happened to him? And I was divorced and single for the last six years. I've recently started dating the last two years. But I've always been responsible by financing. How did he pass away? Unexpected. I did not know he was using drugs and ended up giving him a heart attack and he died in his sleep. How are the kiddos doing? Did they have much connection with him? They did, but they didn't. They saw him every other weekend, but towards the last few months of their visits over there, we live like 15 minutes apart, they were kind of getting a little bit separated from there. They just saw activity there. They just knew it wasn't right. Wow, you guys have been through it. Yeah, I've been the bigger part and the most responsible out of our relationship. We were married for almost 10 years. Sure. He walked out from an affair, and he stopped paying child support roughly in 21. So how much do you receive in Social Security benefits? That's what I'd like to get to. So I receive close to $4,000 a month in Social Security benefits for them. And I don't know exactly what I should do with this money. It should be in your budget. That's who I was thinking. Between my home, because of my income that I make myself, and then theirs, I almost look at it as like child support in a way that I didn't receive to the time they were there. It's exactly what it is. It's replacing his income, and his income was being used for child support, and Social Security replaced his income. That's what it's supposed to do. It's not supposed to go into trust for the children and their future. Meanwhile, they starve to death. So it costs more than $4,000 a month to raise three kids, including food, electricity, shelter, gasoline to take them to school, clothing, and so on. And so it's going to take that and more to raise them. Agreed? Agreed. Yes, sir. Yeah. So it's your money to use for your children, and you're a good mom, and you're going to use it for your kids. That's really helpful. I sat down with my FPU leader last summer to help budget this out when I started receiving this stuff, and I've just kind of been letting that money pile up and use it here and there. and I've got about almost $30,000 sitting there. So I was like, do I use this to pay off my debt? Because I have now, as of today, paid $56,000 in debt since last summer, and I've got $125,000 left. Wow, $125,000 on what? I'm so ready. I only have $30,000 in student loans left. I actually tried to start a food truck business about a year and a half, two years ago, and I ran it for about a year running three other jobs, trying to just make ends meet for me and my kids, and I couldn't keep running myself ragged until I got this position last year with a friend. I'm sorry, $30,000 in student loans, $125,000 in debt, so what is the other $95,000? I got a HELOC loan for the business that I tried to do. That's at $40,000 right now, and then I purchased an SUV last fall. Because of having three older children, a small car was just kind of getting a little bit too tight fit for me. And how much do you owe on the SUV? Fifty-three. Okay. You can't afford that SUV, honey. Okay. You don't make enough to pay that. Okay. You make $44,000 a year. You don't need a $55,000. No, no, no, no, no, no. I switched from making $44,000 a year that I bring home close to $90,000 now. Oh, okay. I'm bringing home at least $8,000 a month now. Okay, plus the Social Security. Plus the Social Security, yes, sir. Well, let's recoup. I mean, if you want to keep that car and fight your way through it, you can. I personally would sell it and move down. I think it's too much car. It's not way too much anymore now that we changed the numbers, but it's too much. And I don't want you to ever emotionally justify going into debt again. Right. Yeah, I don't want to. My goal is to get out of debt and stay out of debt. No, you took FPU and then you went and bought a $53,000 SUV. You're not getting out of that one alive, okay? I'm coming after you. Understood. No more. No more. You've got to stop it, okay? Because it's going to kill yourself. This is not good. You've got to stop it. Think about it this way, Jessica. If you did sell that car, and let's say you downgrade it to a $20,000 SUV, it gives you $33,000 in profit if the car is actually worth $53,000, right? No, she owes. You owe $53,000, so you sell it and get a car. $253,000. How much is it worth? I think on the market right now, they all run right around $60,000. Okay. So you've got $7,000 in profit, plus you have $30,000 in savings. So now you can get you a nice SUV still and have money left over. You freed up the car payment, which is how much? It's right at $983,000, so $1,000. It's got a raise right there. Yeah. And now you can actually knock out this student loan debt and the E-lock. I would do that. I'd be in a $20,000 SUV that was paid for within two weeks. I really would do that. But overall, back to your original answer is it takes the Social Security is there for the good of the children, and it's not the good of the children's future. It's the good of the children. And so as long as you are spending the equivalent of your child support or the equivalent of your Social Security payments from your ex-husband's death on your children, then you are morally and ethically just fine. And I would just put the $4,000 in your budget, and I would get out of debt as fast as I can and don't make any more of these emotional purchases that you emotionally justify with debt. And walking through the baby steps, there's a time and place to invest for those kids, especially for their education, and that's in baby step five. So baby step one, $1,000, you have that. Baby step two, let's knock out all this consumer debt. Baby step three, let's stack up that emergency fund to three to six months of expenses. Baby step four, we begin investing 15%. So if you're investing now, let's pause that until you clean this mess up. Then we can start using this money to put away for college in a 529 plan, and that will really set them up. That's some of the best way you can use this money because now you're really prepping for the future if you can clean this debt up. I am very proud of you with the way you went and got more income to make sure your kids are taken care of. You're a warrior princess. You tell people, Dave, just go double your income, and people go, you can't do that. She did it as a single mom of three. She said, I've got to have more money to do this, and she went and got it. So good for you. Good for you. And you've stacked the cash. You haven't blown it. So you've got $30K laying there. That gives you some options. If you don't do what George said to do on the SUV, at least throw the $30K at the debt, and let's get it cleaned up. Let's get this debt paid off. Okay? But I would do what George said to do. I think he's exactly right. Thank you, Jessica. Thank you. Hey guys, George Camel here. You ever feel like you make good money and still have nothing to show for it You run into Target for one thing and somehow walk out later with toothpaste and emotional support candles Just me Okay Well that the problem Most people don pay attention to how they spend their money so it does whatever it wants And that why we created EveryDollar It's a budgeting app that helps you create a simple plan for your money. EveryDollar is simple, it's clear, and it helps track where your money's actually going. Plus, you get daily lessons, to-dos, and reminders along the way. It's like having a money coach in your pocket. Your money's been freelancing long enough, it's time to give EveryDollar a full-time job. Go download EveryDollar for free on the App Store or Google Play. Buying or selling a home is a big deal, so you want a professional in your corner. A professional is someone who sells a lot of real estate, not someone who sold two houses last year. So if your Aunt Gertie sold two houses and she has her license, she does not get to be your real estate agent. She's your Aunt Gertie. No thank you. You need to get a pro, somebody that sells a bunch of houses, like 30, 50, or 150, 200 houses a year. If you want one that has that kind of chops, high octane, high protein, you want a Ramsey trusted agent that we have vetted. And if you want to know who we've vetted, you can find out for free at RamseySolutions.com slash agent or click the link in the description or YouTube. All right, here we go. Chris is in Minneapolis. Hi, Chris. How are you? Better than I deserve, sir. How are you guys? Just the same, sir. How can we help? Well, first off, I want to thank you guys. um ramsey has uh changed the future of my myself and my family awesome um thank you and we are yes yeah um my wife and i and our three kids um we're on baby steps four five and six right now and uh my sister referred um some financial advisors to us um i've been we've been using every dollar for a few years. We've been following the, uh, um, the roadmap on the every dollar app. And I was just kind of curious to see how it measured up to what the financial advisors were, um, would come up with. And surprisingly they were within about a hundred, a hundred dollars of each other. Um, yeah. Um, for, for our retirement. Um, anyway, so they were talking about something that they, they would recommend moving around. and one of the things they brought up was whole life insurance policies. We already have term life, and I know whole life is a bad word in the Ramsey world. When I asked them what their reasoning was, they glued themselves to the savings account with it. The scenario that they painted for us is we reach our retirement age and we're in an economic depression at that time, and to have an extra savings account that we could draw our monthly expenses from instead of touching our retirement account. So their premise is that the life insurance company will be open and prospering, but the stock market will have disappeared. That's dumb butt. Yeah, yeah. You understand the life insurance company holds the savings, right? And if a life insurance company goes kaput, you get zippy. So their set of assumptions is absolutely as asinine as their product. Okay. You knew you were going to call her and get this, right? You didn't give them a dime of your money, right? Tell me you didn't do this. No, no, no, no, no. Okay. No, no, no. But my actual question is, is there something similar? Or should we be planning some kind of a savings account on the side for, like, if that were to happen, you know, something that's tax exempt, something that's just to drop from? Or is it just not? Let me tell you, whole life is not tax exempt. Whole life is only tax exempt if it works. If the product works properly, you lose money. And that makes it tax exempt because it doesn't grow as much as it should. Your basis in a whole life policy for tax purposes is what you put into it. A lot of people don't even get out of it what they put into it, and there's no taxes. But if you get out of it more than you put into it, you pay taxes on whole life. So they lied to you. Okay. Please get away from these people. That's right. Now, back to your original question. How do we prepare for the Great Depression that could be coming? We don't. I don't have an atomic bomb financial plan. What happens if the Russians drop an atomic bomb on us? I don't have a financial plan for that. There's not a financial instrument that will survive that. Because everything, in the event of the Great Depression, as many life insurance companies closed as other companies closed during the Great Depression, as many banks closed as anything else during the Great Depression. The FDIC was formed as a governmental body to insure the savings that's in a bank, the Federal Deposit Insurance Corporation. It's a quasi-government agency, and it's there to protect up to, I think it's $200,000, $250,000 per depositor, now per bank. But even that could collapse. It's an insurance group run by the government. Hypothetically, it could collapse. Social Security could collapse. All of these things are math things that somebody's got to put the money up. Contrary to what the socialist believes, the money has to come from somewhere. It doesn't just magically freaking appear. So I do not have a plan for my wealth in the event that the American economy collapses. Because I don't have a plan if it collapses. I buy bullets and water if it collapses. And by the way, I have bullets and I'll just need to get your water, I guess. But, you know, that's the thing. So, you know, you fall into that situation, but you can't plan for that. And when someone starts selling you a product based on the collapse of the economy, you should look at what happens to their business in the event of the economy collapsing. That's how dumb butt this whole thing is. You should buy whole life because life insurance companies will be just fine if the economy. Oh, crap. Every business will go down except them somehow. They'll be the only one standing. Pacific Life, the whale will make it. You're killing me here. You're killing me. That's so dumb. It's fear-mongering to make their commission is what's happening. So the chances of that, I mean, I'm looking at the stock market. Please do not take any more advice from your sister. What's the worst we've had, David? negative 38% during the 2008 crisis. That's in the last 50 years. That's been the worst. And the market was... Almost 100. It was up 23% the next year. Yeah. So the chances of this being a real issue for a young guy like this who's investing for the long term is zero. Get out of debt. It's not zero, but it's... Have an emergency fund. If you can't bet on the American economy, there's not a lot of other bets. There's not a lot of other things. I mean, you know, if you don't think real estate's going to go up in the next 50 years, Where were you in the last 50 years? You know, what did you miss out on? How did you miss that? You know, of course it's going to go up. And if you don't think the stock market is going to go up, just look at what it's done. Look at what it's done. And the stock market actually is companies that you buy from every day. It's Home Depot and McDonald's and Coca-Cola and Dell and Apple. And you buy their stuff every day. You give them your money, and that makes their company more valuable. And their stock goes up. It's called the American economy. It's how it works. And so that's what we're doing. Oh, God. I'm just angry. I'm not angry. I don't get angry. I'm not angry with Chris, but those people just lie. I don't know how it's still legal that they position themselves as financial advisors when they're really just insurance salespeople. It's crazy. They're whole life agents. They're not financial advisors. For anyone listening, if they're going, hey, whole life is a great product. If your financial advisor says that, you need to run. Please, how quickly can I get out of the building? that's wild it's just like you go into the car lot and they go hey we got these payments for you it's only 24 interest how quick do you run off the lot you're getting screwed how fast do you run out of there like your hair's on fire you get out of the building you mean when something when a company an organization is trying to screw you the last thing you do is you take okay so that That portion of what they said might not be right, but we can trust the other portion of what they said. Well, that's illogical. They are now untrusted. Once I have established that you are as a crook, you is a crook. And so you is a crook, is a crook, is a crook. We are done with you. That's it. We don't do crook. And the reason they push it is very simple. They make the most money by pushing whole life on you. They're going to make close to nothing giving you a term life policy. When Xander sells you a term life insurance policy for a million dollars, they make about 5% of what these whole life guys do selling you a $400,000 policy. I mean, the premiums, the commissions on these things are just astronomical. Hundreds and hundreds of dollars a month that disappear. They're just over there licking their chops and your poor sister, Chris, she got screwed. And then she sent you over there. Sounds like she needs to cancel a whole life policy. Make you like a goat. Oh my God. You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage. To protect your biggest assets, I recommend using Ramsey Trusted Pros. Whether you're looking for car, home, or any other type of insurance, Ramsey trusted providers have been coached and vetted to serve you like we would. Find what you need at RamseySolutions.com slash insurance. Brett is in Santa Fe, New Mexico. Hi, Brett. How are you? Oh, what an honor it is to speak with you, Mr. Ramsey and Mr. Campbell. This is unreal. We're honored to speak with you. How can we help? I have to thank you first. I've been a stay-at-home homeschooling mom to three kiddos, and when I left the workforce to be home with my babies, oh, it was beautiful, but part of me really missed adding to our family financially. So listening to your show and reading your books really gave me a financial purpose, even though I wasn't making that money anymore. And I purposely steward it and manage it well, and I'm just so grateful for the gift that you've given us. Thank you. After eight years of doing that, we're officially weird. We paid off our house, and we're almost babysat millionaires. Way to go. And you did it all while homeschooling the kids by you. Look at you. Well done. The hard work of my husband, absolutely. You did some hard work too, sounds like. Good. Good for you all. Well done. Well, my question today has to do with receiving a monetary gift. My parents are absolutely amazing people, and they've worked ridiculously hard their whole lives, and they've built an incredible life for themselves. They've since retired a couple of years ago, and they're traveling the world, and they're spending their time with family, living their best lives because they've earned it. But they want to give my husband and I a sizable amount of money, and I sure would like your advice about what mindset we should have about this. It's kind of overwhelming, but they're certainly undeserving of such a gift. And while I appreciate their generosity, I'm not sure how to receive such a gift, or even if we should. So what do you think or what advice could you give? What does your husband make? He makes about $170,000. Way to go. And you guys are how old? Almost 40. We're 39. Okay. And how much is the gift? It's about many feet out of my chair. $200,000. Okay. All right. And I assume they're getting tax advice and will use the Unified Estate Tax Credit so that this is not subject to gift tax. Make sure of that. Yeah, absolutely. You've mentioned that before. Very wise. Because otherwise they will get hammered on gift tax. But I'm guessing they've got a large estate and they're wanting to move some of it out while they're alive and they use up some of their exemption. And that's probably not a bad thing at all. I don't mind that at all. So you're millionaires already. You make $170,000. You're in your 40s. You're mature. You're not some trust fund baby that's going to be irresponsible. This just adds progress to what you were already doing, which was good stewardship and mature. So what would you do with the $200,000? Well, we would possibly move up in-house. We've been faking to do that anyway, and we, of course, don't want to do that with that. What's your house worth? A little bit more. We just paid it off. It's worth about $400,000. Cool. So you moved to $600,000. Make it $170,000. I like that. That's a good move. Okay. So is it something that would be a wise thing to accept? Of course, there's no strings attached. I know that's always a question that you asked. Yeah, that was the next question. But as long as there's no strings attached, yeah. They're not forcing you to do something specific with it, right? No. Mom and Dad have millions, and they want to drop a couple hundred on you. while they're alive and watch you enjoy a better house. I like it. Okay. There's nothing toxic in anything you described. Nothing weird, nothing strange. If you call me up and you were immature and you were overspending, then this gift is probably not going to change you to the positive. You already have proven yourself to be good stewards and handlers of money, so this just adds to your progress. And so this is what parents hope for is children like you all. Well, that's also hard to take in, but we're very grateful. Yeah. Blessed indeed. Yeah, go get them. I'm proud of you. Such a rare call. Healthy people on all sides, no dysfunction, doing well financially. If you guys all start doing that, we'll probably be out of business. Man, that was the easiest call we've taken today. It's not very entertaining. Oh, man. The ratings will go down on our Jerry Springer podcast. There's negative amounts of drama with that call. Too peaceful. Way to go. Good job, Britt. Good job, Britt's parents. Good job, Britt's husband. Everyone involved. A plus. Madison is in Huntsville. How are you? I'm doing great. How are y'all? Better than we deserve. What's up? The question is, my husband and I have a business. We started in 2017. and our personal life, we're ready for baby step number four. However, there's still a very large debt on a piece of equipment in our business. And so my question is, where should I be really putting my money? Because that's a 6% interest on a very high dollar piece of equipment. How much do you owe on this piece of equipment? It started at $750,000. Now it's at $330,000. okay what is it it's a crane it's a grapple saw crane truck so we have a tree service and that's what he does for a living now and what is he making on the business um usually we i mean as self-employed i'm paying ourselves but we usually no i mean the profit that you pay taxes on what's your taxable profit on the business oh profit on the business um about half of our gross. So our gross is a million. So we profit about half of that. Way to go. $500,000. And where does that $500,000 go? You pay taxes and then where does the rest of it go? Pay taxes and the rest of it goes in the account. And then when we need to upgrade equipment, well, the business checking account. Oh, I see. Okay. Yeah. So where is it? If that's been happening for a couple of years, why have you not just paid off the grain? Well, Well, we've only grossed that much the past two years. Oh, okay. Yes, yes. So, yeah, you shoveled a bunch of it home and took care of home debt. We took care of home debt. Yeah, so what I want you to do now is shovel the minimal amount home to live on and get this crane paid off. Okay, all right. Right now I'm doing the monthly payment, which is $6,400, and I'm doing $6,500. I want you to put $300,000 on it and pay it off. Okay. I don't want to hear about monthly payments. I want to pay it off now. You're making a half a million dollars a year profit, taxable income, minus taxes, minus living expenses. You should pay that crane off this year. Okay. In a year. Okay. And then you're going to make money like you've never seen before. You're going to make money like you've never seen before. Okay. And then start babysit four in investing for us because we are not, and I just feel so behind. You're okay. You're making a half million dollars a year. You're going to be okay. Okay. I'm just worried about us and the kids and their retirement. I think you're going to be okay. You're making a half million dollars a year. But, listen, the crane is a destabilizer to the business, and so it's a destabilizer to the family as well. Okay. Yeah. So the sooner we get that stinking thing paid off, and then in your business P&L, once it's paid off, I want you to be setting aside a percentage of your net profits every month for retained earnings, and that's business savings. Retained earnings are used, in your all's case, for two or three things. One, it's used for next equipment purchases in cash only. Never finance again. Ever. Hear me? I do. Never do this again. Okay, you pay cash. You make enough money to pay cash for your upgrades and replacement equipment from the rest of your life. Okay? And just allocate 20% of your profits or whatever you want to set aside. Some percentage automatically goes aside for emergencies and for equipment replacement. And that's what your retained earnings are going to be used for because that's the lifeblood of your business, and it's going to keep it moving. And then take everything else home and get your home paid off and get your 15% going into retirement, and you're going to be multimillionaires in a matter of a decade if you follow all that. But you're going to stay right on top of it. You've done a good job managing the cash, I can tell, based on the numbers you gave me. Yeah, you're on a great track. And I want to send them your book, Dave, Build a Business You Love. If you don't mind. I don't mind. Can I do that? All right. That's my gift to you on behalf of Dave. I want to see this business flourish. I want to see it scale and grow completely debt-free. And it's what we teach in Entree Leadership. and it's inspiring to see the business owners do it. People go, you can't run a business with cash. And Dave goes, hold my beer. He did it. He still does it. It's pretty impressive. Good way to run a business. We'll be right back. Anytime with Ask Ramsey. Ask your money question and get answers built on Ramsey principles we use on the show. Whether you're making a decision or just want something explained, Ask Ramsey is here to help. It's fast, simple, and free to use. Go to RamseySolutions.com and try Ask Ramsey today. That's RamseySolutions.com. Our scripture of the day, Luke 12, 15, and he went on to say to them, Watch out and guard yourselves from every kind of greed, because your true life is not made up of the things you own, no matter how rich you may be. Ronald Reagan said, The government's first duty is to protect the people, not run their lives. oh so refreshing when where did where did he go come back Ronald come back Ronald Mark is in Atlanta hey Mark what's up Dave what's good all things man how can we help hey so little situation um I'm 26 years old um married and uh my parents live in Arizona They're in their 60s. Recently, my parents got scammed out of a lot of money, a couple hundred thousand dollars of their savings lost. Wow. No way to get it back. What was the scam? It involved them putting a lot. Go ahead. What was the scam? My dad is a business owner. The scam he was looking on, indeed, for side hustles, and it was some sort of side hustle where you put X amount of money in, and they, quote, unquote, he saw a return on investment of he put $1,000 in in his account, or so it looked there was $2,000 there after he put $1,000 in. So he ended up putting a lot in, And the only reason we found it out was because he called me and said, hey, this is my goal. I need a little bit more. Would you be willing to help out? And it just went down this rabbit hole of us finding out what was going on and how deep they really were. So he had never made a withdrawal. Correct. He only made deposits. He was all just coming in and not coming out. He saw a number on a report, but he never made a withdrawal. Yep, exactly. That's a Ponzi scheme, old-fashioned. That's like Madoff, yeah. Wow. Yeah. And so FBI is involved, I assume. FBI is involved, local, yeah. But the money's gone. Yeah, the money's gone. Money's gone. And what does your dad and mom make for a living? How much do they make a year? They've made about $120,000 a year. That has slowed down. They are not in the best health. And so I would expect closer to $100,000 or less this year. Wow. How can we help? So here's the question. There might be a couple questions along with it. But my wife and I, we've been extremely blessed. We make about $55,000 a month. We have a home in Arizona that we owe $180,000 on. We've been paying it off quickly. We don't have any other debt. And we have offered to let my parents stay at that home in Arizona. We're going to be paying it off in the next few months. and they can stay there rent-free, and we're not worried about it. It's a home that we bought, and then the company moved us out to Atlanta. And so what's your question? The question is, my parents are currently living in a home that they own. They owe about $421,000 on it. It's worth about $731,000. Should they sell their home and pay off the about $131,000 of debt that they have and stay at our place rent-free? Or should they stay at our place rent-free, rent out the home that they own, and chip away at debt? They should sell their home and move into yours. And you're going to keep the home in your name, but you're going to allow them to live there the rest of their lives debt-free and no payments, no rent-free for the rest of their lives. They're 60 years old, so for 25 years you're going to be okay with this. Yep. and your wife's going to be okay with this. Yeah, we've talked about it, and of all the solutions that we could come up with, this sounded like the best option. It's conditional. It's conditional for me. My gift is conditional. I want you guys to continue to work, and I want you to pay $2,000 a month into a good mutual fund to build your nest egg instead of paying rent. and if you're not going to do that you can't move in okay I don't need the money I want you to do it for you but you need to pay money for where you're living and I just want you to pay it into an account for your nest egg and you sit down with a smart investor pro and have them help pick out some good mutual funds and set up an account and I'm going to help you but with my gift I'm going to require something that you do something that's good for you not for me for sure. And are you going to cover all of their bills? Utilities, taxes, insurance, maintenance, lifestyle, groceries? No. They can stay at the house. They will cover the bills. They'll cover the electric, the water, everything that comes at the house they will be covering. They'll cover the insurance and the taxes? Insurance and taxes, good question. I'm saying this to make sure that you're very clear with them. Who's got what is important. and if they're going to be paying the taxes and insurance and you're the owner, you need to get verification once a year that that bill is paid. Got it. Because otherwise you're going to get foreclosed on for back property taxes one day, five years from now and not see it coming. It could happen. Yeah, I understand. Lots of things in this story happen that we never thought would happen. For sure. What do you do for a living? I sell I'm a door-to-door salesman I sell window replacements and you're making $600,000 yes very well done sir proud of you it's amazing you're really taking care of your parents fabulously, congratulations I'm happy for you, I'm happy for them but I would put that condition on there and that they do something for themselves and they can make $100,000 and they're in their 60s just keep working You got scammed. Keep working. Put the money back. $2,000 a month. How fast would they have the $300,000 back? I mean, $24,000 a year? For three years or $75,000, they'll probably be pretty close then. Probably three or four years they'll have their money back. And it'll double every seven years. So that's not bad. It'll create a little bit of a nest egg because there's going to be a day where they can't work if they're in poor health, and you've got to be ready for that. What happens then? A free house doesn't cause you to be able to eat. Yeah. So you need to be ready to. Yeah, they're on poor health now, he said. But, wow, Mark, that's scary. It's a scary lesson for everybody out there to learn on the scamming that goes on. Adam is in Knoxville. Hi, Adam. What's up? How you doing, brother? Better than I deserve. How can we help? I've got a question for you. So as I'm growing in my life, and I've got three small children, And I'm wondering whether to invest in your memories today with the money I have. Invest in it today, or do I invest in me and my wife's future? When you were a kid, what's the fanciest vacation you went on? I went to Motor Beach in North Carolina. Do you see a therapist for the child abuse that you received? No. So your parents didn't spend a lot of money on experiences. Myrtle Beach ain't way up there. No, it's not way up there. And you turned out okay, and you're not mad at your dad. I never knew my dad. Well, you're not mad at whoever took you to Myrtle Beach. Okay. No. You turned out okay. So I do want you to spend some experiences, but let's not live in the land of this is what makes children into wonderful adults because daddy took them to Disney World and spent $500 million every summer. That's bull crap. At the expense of his retirement. Now he's broke in retirement, and we have to pay his bills. What turns children into wonderful adults is a good dad that loves them and is there for them, a good mom that loves them and is there for them. And, yes, we do do some things with experiences with the money, but we also save for our future so you don't have to take care of me when I'm old. You should be taking care of your own kids. instead of me. And so you got to do both. That's called being a grown-up. But don't get over on that camp where experiences are more important to where we're going to be irresponsible about our future. Nah. My experiences were a tent at a lake. That's what I remember. That's why I remember it fondly. And now you're glamping. And now I don't do that anymore. That puts us out 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.