0:14

This is the Ramsey show

0:16

where America hangs out to

0:18

have a conversation about life,

0:20

specifically money, your

0:23

professional career and

0:25

your relationships. AAA 825-225-225

0:27

is the phone number,

0:30

825-225-225-225. Currently holding

0:32

his stock position and

0:34

sitting alongside me is George

0:36

Campbell. Welcome, pal. Can I

0:38

be honest, Kit? I haven't

0:40

even looked at my 401k.

0:42

I have no desire. Good

0:45

decision. Good decision. I'm riding

0:47

it out. I'm kidding it

0:49

out. I'm kid Coleman. We'll

0:51

be with you together. We

0:53

always have a lot of

0:55

fun together. George will take

0:57

the lead on your money

0:59

questions. I'll take the lead

1:01

on your income questions.

1:03

That's what we want you

1:06

to do. Don't look at your 401k.

1:08

Don't look at the headlines today.

1:10

Yeah, today's probably a good day to

1:12

just Playboard you know is having a

1:14

good day all of the news outlets

1:16

who are getting a lot of views

1:19

from you guys very excited Very excited

1:21

all of your clicks and eyeballs

1:23

going. Oh my gosh. It's all coming

1:25

down. It's all coming down. It's gonna

1:27

be okay. You're not cashing out your

1:29

retirement today. That's right leave

1:32

it alone. Just breathe go find a

1:34

hobby. Go find a hobby. and it's

1:36

on sale it's on sale it's a good

1:38

way of saying it's time you invest

1:40

those stocks are a lot cheaper and

1:43

i'm gonna bite my fingers until they

1:45

are completely gone to not go on

1:47

a rant today about what i think

1:50

about these tariffs but i will

1:52

let that alone for today i

1:54

think let's go to michael in Charleston

1:56

West Virginia michael how can

1:58

we help husband in 2008

2:00

and got a settlement because he

2:03

died on a work accident

2:05

and had a family friend who

2:07

was a trust officer at

2:09

a regional bank and offered

2:11

to help me walk through the

2:14

whole process and drew up

2:16

some trust for me and

2:18

my kids and two years ago

2:20

I found out that he

2:22

stole all the money. $8 million

2:24

in the accounts and there was

2:27

nothing. So I just recently

2:29

received a malpractice settlement for $531,000,

2:31

and it took me two

2:33

weeks to even put it

2:35

in the bank because I was

2:38

scared to let go of

2:40

the check. Sure. So I've

2:42

just got it in a money

2:44

market account right now at

2:46

$3.75 interest because I just... Needed

2:48

it somewhere safe, but I need

2:51

it to grow and I'm

2:53

just scared to do anything with

2:55

it now. Sure. Can we

2:57

just ask what happened? Did

2:59

you report this to the law?

3:02

Is there anything working on

3:04

this? We have, I have

3:06

some attorneys that are working on

3:08

it, but it looks like

3:10

he has spent all of the

3:12

money. I might possibly recover

3:14

a couple hundred thousand dollars

3:17

maybe. Wow. Is he in prison

3:19

now? Where is this guy?

3:21

he's in Florida right now

3:23

and we found out there's other

3:25

widows he's done it too.

3:27

Oh sure. Well I'm hoping that

3:30

he's gonna be arrested soon. Well

3:32

that's that's the hope. Okay.

3:34

In the meantime we've got to

3:37

help you with this 530-some

3:39

thousand dollars. Do you have

3:41

any debt right now? I moved

3:43

into a trailer when I

3:45

found out or into a

3:47

camper when I found out the

3:49

money was gone because I

3:51

panicked and... Didn't want to be

3:54

spending any more money. So I

3:56

owe about 12 on the

3:58

camper and I have a little

4:01

bit on a credit card

4:03

because I'd have come to

4:05

my backup while I was

4:07

figuring things out. Do you have

4:09

a job? No, I still medically am

4:11

not in a place that I can

4:13

really get a job, but I do

4:16

get workers' comp from my

4:18

husband's accident. Okay,

4:20

so what are your monthly

4:22

expenses, and then are you

4:25

able to cover those with your

4:27

medical? I just recently the guy

4:29

who took the money was giving

4:31

me a paycheck so I had

4:33

Obamacare and when he took the

4:35

paycheck now I'm on Medicaid and

4:37

then I just found out that

4:40

because of the settlement I'll

4:42

probably lose Medicaid so just little

4:44

things that are up in the air that

4:46

I'm not sure what to do but I

4:48

don't have a lot of expenses I

4:51

get about 2783 a month from

4:53

workers comp and I have about

4:55

$1,500 give or take. I pay

4:57

extra on the camper and medical

4:59

bills and things like that. Do

5:01

you have any family? Do you have

5:03

kids? I have two grown children

5:05

and I, actually my camper is

5:08

on my mother's property. Okay, and

5:10

where were you living before? I

5:12

had an apartment. I went straight

5:14

for my mom and dad's house

5:16

to my husband's house. I got

5:18

an apartment and decided I would live

5:21

in town and do that for

5:23

a few. So what would it cost

5:25

you to rent somewhere? Let's say

5:27

you got rid of the camper?

5:29

Everything I've looked at, the camper's

5:31

better than what I would spend

5:34

to rent. Well, better is, I want

5:36

to argue with that word. I

5:38

don't know that your quality of

5:40

life is amazing right now, living

5:42

in this camper on your mom's

5:45

property. I think you need to stand on your

5:47

own two feet and do some sort of work

5:49

that you can do because I don't know that

5:51

this is going to provide enough income for you

5:53

to cover for the rest of your life. When

5:56

does this workers comp end? I get it

5:58

until I'm 70. And how old are you now? 53.

6:00

Okay, so you got another 17 years

6:02

of this 2783, but that's not enough

6:05

to cover your bills and have a

6:07

life. No, that's why I need to

6:09

know what to do with the money.

6:11

Well, you're going to need to

6:14

invest the money. You don't need

6:16

a big portion of it right

6:18

now, other than paying off this

6:20

debt, which I would just suggest

6:22

selling this camper and getting rid

6:24

of it. Are you underwater on

6:26

the camper? No, I went

6:28

very minimal on one. So you owe

6:30

12K, what is the camper worth? It's

6:32

probably worth 20. Okay. So you could profit

6:35

off of that, and then what's the

6:37

credit card balance? It's like $5,500 right

6:39

now. Okay. I've got medical stuff on

6:41

it. So you could sell the camper,

6:43

use the profits to pay off the

6:45

credit cards, never touch debt again, build

6:48

up an emergency fund with some of

6:50

the settlement money and invest the rest.

6:53

Yes, that's what I would do.

6:55

My brother, my husband and I

6:57

did financial peace before he passed

6:59

away. So I've just been in

7:01

this situation now that it's, that

7:03

I have a little bit of credit

7:06

card debt made here because that's

7:08

what happened. Well, you're going to

7:10

start a new chapter now. And

7:12

it's been a long time and

7:14

I think you've been stuck in

7:17

the sort of fighter flight and then

7:19

all the grief of learning that this

7:21

money's gone. and i think we just

7:23

need to move forward and i hope

7:25

that you can get some resolution i

7:28

don't think you're gonna get all your

7:30

money back i do hope this guy

7:32

gets what he deserves but for now

7:34

you got to go find something you can

7:36

do and create a life for yourself

7:39

you're in survival mode i am very

7:41

much so so what would it take for

7:43

you to be able to do some

7:45

sort of work is a physical

7:47

therapy rehab therapy what what would it's

7:49

all surgical i just have a lot

7:52

of Internal issues now from all

7:54

the surgeries Could you do something

7:56

from home customer service?

7:58

You're talking to us And so I

8:00

feel like there's got to be something out

8:02

there you can do to create some

8:04

income. Probably I could do something from

8:07

home. I guess it's probably a little

8:09

lack of confidence too. I was going

8:11

to stay home since I was 24.

8:13

Well, you've got a good personality.

8:16

You've got good common sense. Your

8:18

brain's working fine. And you need to

8:20

be working for momentum sake. It's not about

8:22

a ton of money that you need, but

8:24

it's about momentum across the board. your shoulders

8:26

will go back a little bit more. Your

8:29

head gets a little higher as you begin

8:31

to see that I can take care of

8:33

myself. And the good news is if you

8:35

do what George told you to do, we

8:37

also want you to go see a SmartVester

8:39

Pro in your area or two or three

8:42

and have them explain how they're going to

8:44

help you invest that money. And then your

8:46

confidence begins to grow and you can still

8:48

climb back here. Thank you for calling. This

8:50

is the Ramsey show. Hey

8:53

listen up everyone is at risk

8:55

of identity theft. I don't care

8:58

if you're a hermit living off

9:00

the grid listening to the show

9:02

on a battery powered radio all

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of your data collected by every

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company you've ever done business with

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lives Online your bank your doctor's

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office retailers the apps on your

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phone the gas station where you

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have loyalty rewards they all store

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forty-five. Good to have you

9:54

here with us, so

9:56

are you staying

9:58

on track? with the baby

10:00

steps. You can take a quick quiz to

10:03

check your progress and receive a personalized plan.

10:05

just for you. Simply head to the show

10:07

notes, click on the link titled, Are you

10:09

on track with the baby steps and complete

10:12

the quiz? You'll get a result and that'll

10:14

help you get caught up with all of

10:16

our content because we want you to hit

10:18

the ground running no matter how fast that

10:21

is. Sometimes you just got a crawl before

10:23

you walk. Remember that. And we're here along

10:25

the way. Let's go to Detroit Michigan next

10:28

where Jill joins us. Jill, how can we

10:30

help today? Hi, oh

10:32

my gosh, I'm so nervous. Oh,

10:34

well, it's because George is on.

10:36

He's very intimidating, but I'm going

10:38

to be here for you. Yes.

10:41

So I am currently in Baby

10:43

Step 2. I have only 9,000

10:45

left to go. I've been working

10:47

like crazy seven days a week

10:49

and evenings and I'm exhausted. But

10:51

I'm trying to figure out once

10:53

I'm in Baby Step 4, how

10:55

to invest 15% because I don't

10:58

see the numbers working out. And

11:00

I'm wondering if I should pay

11:02

off my mortgage like it's Baby

11:04

Step 2 or if I need

11:06

to just do side gigs for

11:08

the next decade or so. Side

11:10

gigs for a decade, I'd rather

11:13

see you get your full-time income

11:15

up. But let's take it on

11:17

the numbers here to see what's

11:19

actually on for a budget echte

11:21

of me. Yeah. Okay, what is

11:23

your income? Yeah. Your gross income.

11:25

I make $57, 800. I'm a

11:28

teacher. So I also make about

11:30

$3,000. or 3,500 gross in the

11:32

summer. Right. So that's 60 grand?

11:34

Mm-hmm. Okay. And you're saying you

11:36

can't invest 15% once you're debt

11:38

free. You're not going to have

11:40

the margin to do it? I

11:43

mean, according to the numbers that

11:45

I, according to the math that

11:47

I did, my household expenses are

11:49

around 3,000. Okay. And I think...

11:51

my net income, according to my

11:53

paycheck, is about $32.25. And then

11:55

the summer, I mean, divide that

11:58

by 12 and add that to

12:00

the income. So you're talking about

12:02

investing $750 a month. That's what

12:04

15% is of your gross income.

12:06

And so when you do your

12:08

every dollar budget and you list

12:10

out your take home pay, now

12:13

it's coming out before it hits

12:15

your bank account. You have a

12:17

403B through your employer? I do.

12:19

I'm not investing right now, but

12:21

I get a four percent match.

12:23

so okay so once you're there

12:25

you invest 15% whatever's left becomes

12:28

your take home pay that you're

12:30

gonna pay all of your bills

12:32

out of okay so it may

12:34

not be as much of an

12:36

issue as you think as long

12:38

as you can live off the

12:40

rest of that take home pay

12:43

i'm just like when i look

12:45

at my margin it's like four

12:47

hundred seventy five dollars man less

12:49

than missing something well that's on

12:51

the net side you're looking at

12:53

your budget with your take home

12:55

pay So it would

12:57

reduce your your gross income by 750

13:00

bucks if you were making 5,000 what's

13:02

going to actually end up in your

13:04

bank account is 4250 You track it

13:06

okay, so I think so right now

13:08

I have 6% being taken up for

13:11

my pension automatically Okay, so that's already

13:13

and I think you guys say to

13:15

cut that in half Yes, we would

13:17

count that as half of your 15%

13:19

So we would count it as 3

13:22

you would still need to invest another

13:24

12 Okay, and then

13:26

I wanted to do the 4% for

13:28

the match and then do the rest

13:30

in our Roth IRA And so that's why

13:32

I was doing net income. Does that

13:34

make sense? Yes But I'm thinking here,

13:36

what were your debt payments when you

13:38

started this process? What were your total debt

13:41

payments per month? Not much because so

13:43

I think only like a hundred bucks

13:45

per month because most of its due loans

13:47

and I have a zero-dollar payment for

13:49

a zero dollar payment right now Okay,

13:51

so what I would do is once

13:53

you're debt free, you're going to start doing

13:55

your budget I would ratchet it up

13:57

to 15% and then see what the

13:59

deficit is if there is one. I think

14:02

the numbers are going to work here.

14:04

I don't know what all the rest

14:06

of your expenses are and what you can

14:08

trim out of the budget, but there's

14:10

two ways to find this margin. Either

14:12

spend less or make more. So before

14:14

you go sign up for a side gig

14:16

for the next decade, I'd rather see

14:18

us work on spending less and reducing

14:20

our bills so that you have the margin

14:22

to do this. And by the way,

14:25

there's still other baby steps. You know,

14:27

like you said, you want to pay

14:29

off the mortgage really? Do you have children?

14:31

No. Okay, so we can skip

14:33

baby step five and we're going

14:35

to move on to six, which

14:37

is any extra income beyond the

14:39

15% we can start throwing at

14:41

the mortgage. But no, you don't

14:43

have to treat that like a

14:46

baby step two item. We move

14:48

from intensity to intentionality when we

14:50

move out of baby step three

14:52

into four. So that could be

14:54

a seven to ten year journey.

14:56

You don't need to do this

14:58

in three years. I think you

15:00

need to enjoy life. Or

15:02

do you enjoy doing it? I

15:05

just... Well, I do get bored

15:07

if I... I have taken somewhere

15:09

off before and it's just get

15:12

boring, but... I don't know. I

15:14

just didn't see the numbers working

15:17

out, like I thought, so... Well,

15:19

the every dollar budget will tell

15:21

you, but I want you to

15:24

just make sure you're looking at

15:26

the right numbers, gross versus net.

15:28

Because that'll be deducted from each

15:31

paycheck. The

15:33

Roth IRA doesn't come out of your

15:35

net though. Roth IRA you would invest

15:37

on your own. So that wouldn't come

15:39

directly out of your paycheck. That's not

15:41

through your employer. Do you have a

15:43

Roth 403B through your employer? No I

15:46

don't. They don't offer a Roth option.

15:48

Okay. So yeah, you do match Beats

15:50

Roth Beach traditional. So invest up to

15:52

the match, that's 4%. Move on to

15:54

your Roth options, which would be an

15:56

IRA outside of your IRA outside of

15:58

your employer. you would move back. But

16:00

it sounds like you will you will

16:02

hit that with your employer so you

16:05

won't need to move back to it.

16:07

Okay. You got this? Now do you

16:09

believe Jill? I don't know I guess.

16:11

I mean maybe when I get there

16:13

it'll be different but... I think so

16:15

and you'll make more money over time

16:17

right? Yeah true. I mean I'll move

16:19

up to 61 thousand that fall or

16:22

this fall. I want to see you

16:24

actually... I want you to look outside

16:26

the teaching world. I really would like

16:28

to see you try it. Just look

16:30

at it. Just see where you could

16:32

take your experience and skill set and

16:34

make a sizable chunk more. And then

16:36

I also think while you're looking at

16:38

that, you ought to be looking at

16:41

some good money earning opportunities in the

16:43

summer. Let's see if we could keep

16:45

that income going doing something else during

16:47

the summer. You've got to look. And

16:49

Jill, I can hear it in your

16:51

voice. You're one of those, you're the

16:53

true doubting Thomas. from the Bible. You

16:55

know, you got to see the scars.

16:58

And George laid it out for you,

17:00

so you're going to have to try

17:02

this stuff so you can see what

17:04

he's saying. Because even as he lays

17:06

it out, you're having a hard time

17:08

believing it's possible, but I've sat with

17:10

him long enough to know he's right.

17:12

But you're going to have to try

17:15

some of this stuff. So I'm really

17:17

going to push you in two other

17:19

areas. I really do want you to

17:21

see what you can make you can

17:23

make in the summer. Let's look, could

17:25

I transition from the traditional teaching world

17:27

into a different role? Because I've counseled

17:29

so many teachers, George, you know this,

17:31

on my old show, the Ken Coleman

17:34

show, where they didn't think they could

17:36

do anything but teach, but you can.

17:38

Those skill sets, you are an instructor

17:40

at heart, and you are an instructor

17:42

by trade. That's really, really valuable. So

17:44

if I were to just tell you

17:46

to kick the tires on looking at

17:48

corporate training, for instance, you know i

17:51

think you should be making somewhere between

17:53

seventy five to a hundred thousand dollars

17:55

well but you won't see it if

17:57

you don't look for it Well,

18:00

I will say I don't I do live

18:02

in a smaller town. I'm not in Detroit,

18:04

but I have I just do like Department

18:07

of Natural Resources summer gigs like that. That's

18:09

what I've been doing. I know, but that's

18:11

that's bottom of the barrel. You're worth more

18:13

than that. I'm trying to get you fired

18:16

up a little bit. You know, I'm trying

18:18

to be your cheerleader in the locker room

18:20

because if you head out on the field

18:22

acting like you are right now, you're going

18:25

to get beat by a hundred. You gotta

18:27

come out of that lockroom like you're gonna

18:29

destroy the other team and you need to

18:31

come out of this thing going I'm gonna

18:33

actually do what George told me to do

18:36

and that's just the beginning that I'm gonna

18:38

Absolutely win and if I got a move

18:40

I'm gonna move, but you need to happen

18:42

to life Jill I think too much of

18:45

life is happening to you I guess I

18:47

just don't know what to do in the

18:49

summer then because that's I know you don't

18:51

because you have a look for it you

18:54

have a look for it You gotta get

18:56

your head up. You gotta start looking. You

18:58

gotta start talking to everybody. Hey, I'm a

19:00

teacher. This is the skill set I've got,

19:03

George. I've done this for this many years.

19:05

I'm looking for this kind of work here.

19:07

And you gotta look for it. You cannot

19:09

find it if you don't look for it.

19:11

And looking for it means, I believe if

19:14

I look for it, that I'll see it.

19:16

Come on, Jill, let's go. Happen to life

19:18

a little bit. Rachel

19:24

do you ever get these sketchy text

19:26

messages that are like hey you need

19:28

to update your address and verify so

19:31

we can get you the package you

19:33

didn't order? Yes I have George sketchy

19:35

and never trust them and that's why

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we recommend delete me they help with

19:40

that yeah they do delete me actually

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goes in and removes your information from

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data broker websites and it is an

19:46

incredible service that everyone needs and there's

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a lot of shady companies out there

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data to bad guys and that means

19:55

your info like your email address your

19:58

kids names your name everything is just

20:00

out there for scammers and spammers to

20:02

find that's right and then once they

20:04

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20:07

send you a detailed report telling you

20:09

where they found your information when they

20:11

removed it how many hours they've saved

20:13

you I mean it is incredible so

20:16

detailed and it's beautiful I love these

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20:49

you guys. Hey, what's up guys? It's

20:52

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20:54

who knows student loan debt is a

20:56

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20:58

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21:01

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21:03

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21:05

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21:07

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21:10

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21:12

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21:14

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21:32

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21:34

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21:39

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21:41

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Laurel road.com/ring. Lorel Road is a brand

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of Key Bank National Association. All credit

22:06

products are subject to credit approval. Lisa

22:08

from Milwaukee is up next. Lisa how

22:10

can we help? Hi George and Ken,

22:13

thank you so much for taking my

22:15

call. You bet. My question a little

22:17

bit of a background. I started a

22:19

business in 2023 and it took a

22:22

little time to get it ramped up

22:24

so I didn't make that much in

22:26

2023. So the taxes that I paid

22:28

were relatively low. But in 2024 I

22:31

did much better and as I was

22:33

giving all my documents to my tax

22:35

repair I said oh my gosh I'm

22:37

sick I can just imagine how much

22:40

I'm going to have to pay in

22:42

taxes. Is there anything I can do

22:44

to reduce my tax bill? I'm in

22:46

real estate and I said, aside from

22:49

purchasing properties, I'm not in that, in

22:51

that mode yet. And he said that

22:53

I could, I have a Ross, a

22:55

self-directed Ross IRA, but that won't reduce

22:58

my tax bill. He said I could

23:00

open a traditional IRA, a step, a

23:02

simple IRA or self-directed 401K, but at

23:04

this point, my only option is a

23:07

traditional IRA for 2024 tax benefits. Is

23:09

it? beneficial for somebody self-employed to open

23:11

a traditional IRA for tax benefits? Well,

23:13

I mean, you're just switching it up.

23:16

So with the Roth side, you're paying

23:18

taxes now and then never again. And

23:20

so what you're saying is, well, I'd

23:22

rather not pay the taxes now, but

23:25

one day when you go to withdraw

23:27

that money, you're going to pay taxes

23:29

on it. So there's no way to

23:31

really avoid the tax man. You're going

23:33

to do it on either side. And

23:36

if I'm in your shoes, if I'm

23:38

in your shoes. I don't like doing

23:40

anything for the tax benefit. I know

23:42

it stinks to pay taxes, but it's

23:45

just part of making an income in

23:47

America today. And so I would do

23:49

any other thing you can do to

23:51

reduce your taxable income through deductions and

23:54

credits, but I don't think it's worth

23:56

switching to the traditional side just to

23:58

save a little bit on taxes. Should

24:00

I have an additional? Uh, retirement account

24:03

besides the self-directed rock, I or A4,

24:05

because my expenses for my business, my

24:07

startup expenses, I had some more, but

24:09

now my expenses are very minimal, so

24:12

the amount of deductions that I have

24:14

are very small. So the only thing

24:16

that he said that could reduce is

24:18

either purchasing real estate, which again, isn't

24:21

my mode of operation. You're out of

24:23

options as far as tax advantage retirement

24:25

accounts. Okay. Do you have a health

24:27

insurance plan? I'm through

24:30

marketplace. I was diagnosed with cancer four

24:32

years ago, so my my health insurance

24:34

is astronomical. Is it a high deductible

24:36

plan or is it PPO? Do you

24:38

know what it is? I believe it's

24:41

HML, but based on my income, it's...

24:43

$600 a month essentially. I was asking

24:45

because if you have a high deductible

24:47

health care plan, you can do an

24:50

HSA, which is a health savings account,

24:52

and you can actually invest through there

24:54

with tax advantages, so it kind of

24:56

becomes a bonus retirement account in that

24:58

way, you know, outside of your Roth

25:01

IRA. Beyond that, beyond the HSA, a

25:03

Roth IRA, if you have no other

25:05

options that you can do, you could

25:07

always go to a taxable brokerage account.

25:10

Non-retirement and just dump money in there

25:12

into some S&P index funds. Okay,

25:15

and that would give me a tax

25:17

advantage then. It wouldn't give you a

25:19

tax advantage, but it's another way to

25:21

invest. If you're not hitting that 15%,

25:24

are you debt-free with an emergency fund

25:26

currently? So for two years when I

25:28

was healing cancer, I didn't work at

25:30

all. So I was living off of

25:33

credit cards. So in 2023, I paid

25:35

up about $10,000, and this past year,

25:37

I paid off the remaining $50,000 in

25:39

credit card. Wow. Well, I should feel

25:41

great, right, but because my income is

25:44

still unpredictable, it really took everything besides

25:46

I had enough money. I didn't know

25:48

how much I was going to pay

25:50

in taxes, but so where are you

25:53

at now? In terms of your debt

25:55

being debt. So no credit card. I

25:57

do I do have about $17,000. remaining

25:59

on a student loan, which I was

26:02

hoping to tackle this year. Okay, if I

26:04

was in your shoes, and again, you called our

26:06

show, this is the way we do it, I

26:08

would pause all investing, you know this, and knock

26:10

out the student loans, get an emergency fund because

26:12

right now you are skating on some thin ice.

26:14

All it takes is one more emergency and

26:16

you're back to using the credit cards.

26:19

It's going to move you backwards and you're

26:21

not going to be able to build wealth because

26:23

you're going to be dealing with all these ankle

26:25

biter things. And so getting rid of that debt,

26:27

getting the emergency fund in place, should be your

26:30

A1 before you get to investing. Okay. I thought

26:32

you would say that, but I wanted confirmation.

26:34

There you go. You got it. We are here

26:36

for you. Lisa. He's consistent. I'm telling you, the

26:38

clock and George Camel got the same consistency. I'm

26:40

taking. I'm taking to hit the mark. Gonna taken.

26:43

Gonna hit the mark. Gonna hit the mark. uh...

26:45

you know we are uh... up against

26:47

the uh... that favorite time of year

26:49

for most americans gotta get those taxes

26:51

in and uh... That sounds right there

26:54

in my hands. I've got some myths

26:56

about taxes. I want to run by

26:58

you, George. You ready? Myth number one.

27:01

A tax refund is free money. What

27:03

say you, George? That's a real gear

27:05

grinder for me again. Oh, okay. You

27:08

need a little... I don't understand. People

27:10

think, well, the government blessed me with

27:12

free money. That's not how it works.

27:15

You just overpaid your taxes throughout

27:17

the year and the government says,

27:19

hey, you overpaid, here, here's a,

27:21

get to as close as zero

27:23

as possible. You don't want to

27:25

owe too much, you don't want

27:27

to get refunded too much.

27:29

All right, myth number two. Higher

27:31

tax brackets are bad. Oh boy, this

27:34

one's hilarious. People go, well Ken,

27:36

I don't want to make, I

27:38

don't want to get a raise,

27:40

I'm going to owe more in

27:42

taxes. I'm going to get kicked

27:44

into another bracket. That's not how

27:46

it actually works. Only the income

27:48

within each bracket is taxed at

27:50

that. 22% on all of your money. That's right.

27:53

There's marginal and effective. So you got to

27:55

look at that earning more increases your income,

27:57

not the overall tax rate. All right. Myth

27:59

number three. Keep. Keeping debt for tax deductions

28:01

is beneficial. Oh boy. You're just trying to

28:03

rile me up, aren't you? It burns your

28:06

biscuits, doesn't it? Yeah, paying interest in order

28:08

to gain a tax deduction is very counterproductive.

28:10

Your tax advisor is suggesting you do this,

28:12

you should fire them. It is way better

28:15

to pay off your debt, save on the

28:17

interest payments, and free up that income, never

28:19

do anything just for the tax deduction. All

28:21

right. Myth number four, the team hates the

28:24

paper critical. They hate it so much. But

28:26

I think the audience loves it. America said

28:28

yes. They do. Pay by tax day or

28:30

don't pay at all. That's a funny one. So they

28:32

go, well, I can't pay what I owe, so

28:35

might as well just not file at all.

28:37

That's how you go to jail. That's not

28:39

a good plan. So the penalty for not

28:41

filing a return or filing late can be

28:43

up to 10 times as much for the

28:45

penalty for the penalty for not paying on

28:47

paying on time. file the return by the

28:49

regular deadline pay as much as you can

28:52

by the deadline and then set up

28:54

a payment plan with the IRS for

28:56

the rest that you owe but you got

28:58

a file by the deadline that's right unless

29:00

you look good in stripes or orange

29:02

hey that's not me okay I neither

29:05

one of us not flatter one of

29:07

us and finally myth number five you're

29:09

not smart enough to do your own

29:11

taxes now that one the jury's out on

29:13

that one well now I'm not So in this

29:15

situation, that would be reality, James. I would go

29:17

to jail accidentally because I'm just bad with details.

29:19

That's fair. Well, here's the good news. You're probably better

29:22

off filing your own taxes if you have a simple

29:24

tax situation. So if you're a normal W2 employee to

29:26

have a lot of life changes this year, then it's

29:28

fine. You can use Ramsey Smart Tax and file on

29:30

your own. But if you have a more complicated tax

29:32

situation, you own a business, you bought a home, you

29:34

bought a baby, you had a baby, you had a

29:36

baby, you had a Ken Coleman, you're Ken Coleman, you

29:38

want to consider connecting, you want to consider connecting with

29:41

a tax professional with a tax professional, with a tax

29:43

professional, with a tax professional, So, regardless of all

29:45

this, you got to file by April 15th.

29:47

The deadline is upon us. And if you're

29:49

ready to file online, be sure to check

29:51

out Ramsey Smart Tax. It's tax software that's

29:53

easy to navigate. It is foolproof. Even Ken

29:55

Coleman could do it. That is true. Go

29:57

to Ramsey solutions.com/Smart Tax or click the link.

29:59

the description if you're on YouTube or

30:02

podcast. All right so I'm glad

30:04

we went through that. Painless. It

30:06

is and so many people make

30:08

bad decisions around taxes. The one

30:10

that kills me is the idea

30:12

that I'm going to go spend

30:14

money in order to get a

30:16

little tax relief. Oh, you know,

30:18

we hear that one a lot.

30:20

That didn't make the myths. But

30:22

you know, the idea is, well,

30:24

I've got a business, we use

30:27

a lot of business owners. So

30:29

I'm going to go out and

30:31

spend a bunch of money in

30:33

order to deduct it as an

30:35

expense. Yeah, as opposed to saving

30:37

it or investing it. It's not

30:39

a dollar for dollar. Doesn't that

30:41

drive you crazy? Doesn't that drive

30:43

you crazy? Doesn't that drive you

30:45

crazy? Doesn't that drive you crazy?

30:47

Where does that come from? Where

30:49

does this notion come from? Well,

30:51

it gets a lot of clicks

30:53

on social media, and then people

30:55

go, well, it makes sense, and

30:57

then your tax pro is telling

31:00

you the same thing, because it's

31:02

what you want to hear. You

31:04

want to go spend money? Great,

31:06

just write it off. It's not

31:08

a dollar-for-dollar deduction, and it's unwise

31:10

to spend money that you don't

31:12

need to be spending. That's not

31:14

how a successful business is run.

31:16

Amazing. It's the last thing America

31:18

needs right now. Well, to be

31:20

fair, George, you're so even Kiel

31:22

that most of Americans can't tell

31:24

when you're raging versus when you're

31:26

relaxing. And I envy that, my

31:28

friend. You're as steady as they

31:30

come. Thank you. Steady Eddie, they

31:33

would have called you back in

31:35

the day. I'll take that before.

31:37

No. Sounds like it's from the

31:39

1950s. Sounds like it's from the

31:41

1950s. It's a fact when you

31:43

can hit a vending machine and

31:45

make some pop, just roll out.

31:47

Just roll out. Pop? Yeah, that's

31:49

what they call it. I'm going

31:51

to get you a can of

31:53

pop. Thank you. You spent years

31:55

trying to get everything just right

31:57

for your family. Now you need

31:59

an easy way to make sure

32:01

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32:03

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32:06

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32:08

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32:10

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32:14

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32:16

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32:18

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32:20

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32:22

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32:24

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32:26

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32:28

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32:31

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32:33

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32:39

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32:41

Ouchay joins us next in

32:44

Alexandria. Washington, it says here.

32:46

All right, I'm familiar with the

32:48

Virginia. I didn't know. All right,

32:50

Ouchay, how can we help? Hi,

32:53

so I was calling mostly

32:55

because I needed some kind

32:58

of coaching and advice. I've

33:00

just been in this country

33:02

since 2020, so I don't know

33:04

much about the credit. That being

33:06

said, I do have a credit

33:09

card debt of $2,000 and I

33:11

have my car loan that I'm still

33:13

paying and I'm currently in

33:15

school. So I have about, I

33:17

think, not I think, it's $8,000

33:19

on student loan. And right now, I

33:22

was working to see how I can

33:24

manage it, so it doesn't go out

33:26

of hand, because already it's quite a

33:29

lot. I can make payments on my

33:31

credit card. However, I came across National

33:33

Debt Relief, and after I heard,

33:36

you know, spoke with one of

33:38

their consultants, they said they can

33:40

negotiate that, and bring the doubts

33:42

with 50%. And obviously I'm going

33:44

to have to pay their fees. In

33:47

total, instead of paying $12, I'm going to

33:49

pay $8, $8,400 hundred. Now it all

33:51

sounds good, but I have no idea for

33:53

anyone to tell me how that affects me.

33:55

If I should just go ahead and pay

33:57

up the card myself or if I can work

33:59

with... on that. You've got George. I'm

34:01

so glad you called. You did not

34:03

sign anything with these people, did you?

34:06

Not yet. Please don't. Please run so

34:08

far away that they can't see you anymore.

34:10

They can't contact you, block their

34:12

numbers. These people are not here to

34:14

help you. Do you understand how these

34:16

work? So they tell you, hey, we'll reduce your

34:19

debt. One month, one easy monthly

34:21

payment. Your life's gonna be so

34:23

much better. Here's what actually happens

34:25

behind the scenes. They tell you to

34:28

stop paying on all your debts. Stop

34:30

paying your creditors, let your accounts go

34:32

to collections, which tanks your financial world. Then

34:34

instead of sending your payments to the debtors,

34:36

you send it to them, right? They put

34:38

it in an account and they hold it

34:40

for you and they wait months, sometimes years

34:43

to negotiate a lower lump sum and they

34:45

charge you for it. That's the fees you're

34:47

talking about. So you pay thousands of dollars

34:49

for someone else to attempt to fix your

34:51

financial mess while tanking your financial

34:53

world, right? Now the creditors, they don't have to

34:55

do any of this. They can still sue you

34:57

to court. They could take you to court. And

35:00

even if they do settle a debt

35:02

for less than you owe, the IRS

35:04

considers the forgiven amount as taxable income.

35:06

So you still have to pay taxes on

35:08

that difference. And so instead of doing

35:10

the shortcut, I believe in Uchay, in

35:12

your ability to pay off this debt on your

35:14

own without this shortcut that's going

35:17

to really harm you in the long run. So

35:19

here's what you do instead. Paws everything

35:21

you're doing in your financial world

35:23

and cover your four walls.

35:25

Can you cover your food,

35:28

utilities, utilities, transportation, transportation? Housing

35:30

with your current income? Well, yes. Yes,

35:32

I can. I definitely can because

35:34

I already use their every dollar to

35:36

come. The only part is I always feel

35:38

like I'm on the edge of not being able

35:40

to get other personal items or let's

35:42

say run out of something during the week.

35:44

I'm like, I don't know if I have

35:47

enough for next. So I was trying to

35:49

see how I can not live on that

35:51

edge. That's your four walls. So you need

35:53

enough to cover the basics. Nothing more and

35:55

then beyond that we need to make the minimum payments

35:57

on our debts. Can you do all of that right

35:59

now? I can definitely

36:01

work towards the minimum payments. Okay, and

36:04

then do you have anything left over

36:06

to throw at your smallest debt? No.

36:08

Beyond your basic bill. So what is

36:10

your income right now? I currently have

36:12

three thousand six hundred and ninety seven

36:14

after taxes every month. Okay, are you

36:16

doing any investing right now? I have

36:18

not started it, but I started putting

36:21

out about twenty one dollars to what

36:23

I can save with those. I just

36:25

have it in a savings account for

36:27

now just because I like said I'm

36:29

always leaving on the edge. So it's

36:31

like maybe I can just put whatever

36:33

small I can find. So how much

36:35

do you have? How much do you

36:37

have in savings? Do you have a

36:40

thousand dollars saved yet? No, I don't

36:42

have a town. Okay. So that is

36:44

your A1. You're going to cover your

36:46

four walls, nothing more, cover all of

36:48

your minimum payments, any extra dollars need

36:50

to go to a savings account until

36:52

you have a savings account until you

36:54

have a savings account until you have

36:57

a thousand. Okay. Then

36:59

once you have a thousand, you're

37:01

going to move on to the

37:03

debt snowball. That's baby step two.

37:05

List out your smallest debt, all

37:07

the way to the largest debt,

37:09

and just attack the little one

37:11

with a vengeance while you make

37:13

minimum payments on the rest. So

37:15

what is the smallest debt if

37:17

you listed them all out? The

37:19

smallest one would definitely be the

37:21

credit card. It's supposed to be

37:23

school loans, but they're not few

37:25

yet, and I'm still in school.

37:27

I have eight thousand. not contacted

37:30

them and how to pay it

37:32

back. Okay. So whatever I have

37:34

to pay right now is just

37:36

my credit card and it's one

37:38

credit card. Are you still using

37:40

that credit card? No, I have

37:42

not used it in the last

37:44

two months. Good. I've been working

37:46

with my own because I'm trying

37:48

to see what is possible and

37:50

that's where I met right now.

37:52

What is your relationship from the

37:54

amount of hours you're working to

37:56

schooling? Well, it's quite tight. I

37:58

work full-time and... I go to

38:00

school full-time, I go to school

38:02

online and then... working full-time because

38:05

I do not want to have

38:07

to do everything on credit. Sure.

38:09

What are you going to school

38:11

for? Well, bachelor's semester is in

38:13

psychology. I'm trying to be a

38:15

behavior analyst. Okay. How much more

38:17

do you have? Schooling-wise. One and

38:19

a half to two years, depending

38:21

if I don't have any gap.

38:24

I'm going to throw this out here

38:26

because I want to hear what George's

38:28

take is and I'm not actually recommending

38:31

this. I'm just wondering if we don't

38:33

think about pausing school for a season

38:35

to get through this. You're so tight

38:37

right now and the degree will still

38:40

be there and I just wonder if

38:42

it's not a good idea for you

38:44

to spend, let's say you spent half

38:47

the amount of time that you're in

38:49

school working an extra job, just for

38:51

a short season, to knock this debt

38:54

out. get an emergency fund in place

38:56

and then finish. It just feels like

38:58

you're trying to do a lot right

39:01

now and you don't have to do

39:03

the school. I know you want to

39:05

and I'm not in any way trying

39:07

to discourage that goal, but I think

39:10

that there's a season for everything and

39:12

it feels like trying to get out

39:14

of debt and get your life set

39:17

up financially and being school full-time is

39:19

not the best. play. George you just

39:21

yeah well you're making decent money right

39:24

now what are you doing full time?

39:26

Well I am a behavior therapist. So

39:28

you're doing all of this for like

39:31

a 10 grand raise what's the upside

39:33

at the end of this? It will

39:35

be about 20 grand raise well that's

39:37

the minimum 20 grand raise from what

39:40

I already am. I would pause right

39:42

now I'm even more bullish on this

39:44

idea. Yeah would they help you cash

39:47

flow this? Your employer

39:49

will they help? Well, no, the the mostly

39:51

did was put me in salary because typically

39:53

you get it hourly pay So when I

39:56

had reached out to them and I said

39:58

hey, this is what I'm doing Because

40:00

it was my supervisor, I suppose. Like

40:02

I said, I came here without

40:04

information. So when I thought about going

40:07

to school, they were like, oh, you

40:09

can go to school. I was like,

40:11

I don't have the money. And they're

40:13

like, oh, you don't have to pay

40:16

it right now. Usually you sign up

40:18

bus, but I mean, you do

40:20

this. So I was already in

40:22

this, and I started understanding the

40:24

system a little better. And I'm like,

40:26

OK, now I need to do this.

40:28

I know, I know, it's been really tough.

40:31

I've thought about pausing school, but

40:33

I keep feeling that pressure in

40:35

me, like, what are you getting?

40:37

You're not going to lose the

40:39

credits, right? Can you pick up

40:41

where you left off, six months, a

40:43

year from now? Okay. Yes, you

40:45

can. I feel like what I do.

40:48

It's because like, where I'm from,

40:50

my culture, I'm still in the school

40:52

and becoming something. There's the real reason.

40:54

But OJ, Ojay, you are, you are,

40:56

I'm not saying pause. The pressure you're

40:59

feeling from the finances is

41:01

way more than the pressure

41:03

you're going to feel from

41:05

back home or anything else. And

41:07

you're not quitting. I'm

41:09

not suggesting you quit. I'm

41:11

saying pause. Do they pay your bills?

41:13

No. Your family? That's putting

41:16

all the pressure on you? No. I don't

41:18

think they get a vote at this

41:20

point. They're not experiencing the stress that

41:22

you are trying to balance all this at

41:24

once. Imagine UJ if I can cast vision.

41:26

Imagine getting this debt paid off the way

41:28

George instructed you and you do this, you

41:30

press pause, and then you get set up

41:32

and you have a strong financial base, your

41:34

debt free, you got an emergency fund, and

41:36

now we start cash flowing our way through

41:39

school. Think about how much less stress you'll

41:41

have in your life as you finish.

41:43

That's the vision. You're actually gonna feel like

41:45

you got a raise because if you do it

41:47

this way that on the track You're on you're

41:49

gonna be throwing your entire raise at more debt.

41:51

Yeah, because you're gonna keep racking it up

41:53

Yeah, I George I'm bullish on this idea. I'm I'm

41:56

for pausing. Yeah. I like that plan and maybe if

41:58

the car I don't know how much the car as

42:00

far as worth, but you may

42:02

want to sell that to get

42:04

out of it and downsize for

42:06

now if you've got public transportation.

42:08

You're in the DC area, so

42:10

it may be possible. Yeah. Good

42:12

hour here on the Rams. You

42:14

show more coming up. As an

42:17

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Timothy Plan Services LLC. This is

43:19

the Ramsey show where America congregates

43:21

to have a conversation about money,

43:23

your work, and your relationships. AAA

43:25

8255-225 is the phone number. 825-225-225.

43:28

I'm Ken Coleman. I'm joined by

43:30

the Natalie Attired Shackett Man. George

43:32

Camel, ladies and gentlemen. Natalie. That's

43:34

a word you don't hear a

43:36

lot. I'm not sure it's a

43:38

word. I'm gonna have to check

43:40

that up. Check that out, rather.

43:42

I said check that up. Is

43:44

Natalie, it's Natty a tire, is

43:46

it? It means it's stylish or

43:48

tidy. You like that. Nothing describes

43:51

you better than stylish and tidy.

43:53

You are so happy right now,

43:55

look at the smile on your

43:57

face. Ken always teaches me a

43:59

new word on this show. I

44:01

hope you guys are learning. along

44:03

with me. I try. George is

44:05

going to lead out on coaching

44:07

you on what to do with

44:09

your money. I'm going to help

44:11

coach you on how to make

44:13

more of your, make more money

44:16

rather, so that you can win

44:18

and win big. Let's go to

44:20

Emily and Philadelphia. Emily how can

44:22

we help today? Hey guys, how's

44:24

it going? Well we're having a

44:26

blast. What's going on with you?

44:28

Well I called in a few

44:30

years ago and at that time

44:32

I was making about 30 grand

44:34

a year and it took me

44:36

a little bit, but since then.

44:39

I have taken David's advice and

44:41

got a more advanced license in

44:43

my field for these days. I

44:45

basically quadrupled my income. Oh, Emily,

44:47

wait a go! Emily, the studio

44:49

audience is clapping for you right

44:51

now. You can't see this, but

44:53

they're so excited for you. Oh,

44:55

that's awesome. Well, I really appreciate

44:57

it. It's been quite the journey,

44:59

but I'm glad I'm here now.

45:02

In addition to that, since then,

45:04

I've got married. And my husband

45:06

is a veteran. He's currently in

45:08

school for his undergraduate degree. So

45:10

of course, we get benefits that

45:12

basically just cover our housing. We

45:14

live in a pretty expensive area.

45:16

So all of his income basically

45:18

goes to helping pay for the

45:20

mortgage, which makes me the sole

45:22

earner for all of the other

45:24

things, especially since he's planning to

45:27

go to law school once he

45:29

finishes his undergrad. We're in a

45:31

place now where we're really eager

45:33

to have our first child within

45:35

the next year or two, which

45:37

brings me to the issue. So

45:39

the issue is that we currently

45:41

have about 120,000 in non-mortage debt,

45:43

and I'm really torn between two

45:45

things here. I don't know whether

45:47

to just keep plugging away at

45:50

the baby steps and pay down

45:52

my hour debt. That's death that

45:54

I brought into their relationship. pay

45:56

down our debt really aggressively or

45:58

to start saving up for parental

46:00

leave since I'm partly self-employed and

46:02

partly employed by a company that

46:04

doesn't have a parental leave policy

46:06

in place. So I just want

46:08

to make sure that I can

46:10

take time off without worrying too

46:13

much about our finances, but I

46:15

also want to be smart about

46:17

the debt. So we've just been

46:19

talking about this a lot lately,

46:21

and I'm hoping you guys can

46:23

help steer the direction here. Yeah.

46:25

What do you make? I

46:28

make about 120 a year. Awesome.

46:30

And what is the total take-home

46:33

pay you guys are bringing in

46:35

every month? It's right around 10,000.

46:37

Okay. And what are your bills

46:40

every month? So I have about

46:42

a thousand in personal loans, about

46:45

5,700 in credit card debt, 14,000

46:47

left on the car, and then

46:49

just... just under 100,000 in student

46:52

loans. And then our mortgage is

46:54

about 2,400 a month. So those

46:57

are the big things. How much

46:59

money would you need to have

47:01

set aside or want to have

47:04

set aside to offset the parental

47:06

leave expenses? I think I would

47:09

feel super comfortable if we had

47:11

20,000 set aside. That's what would

47:13

make me feel really good to

47:16

know that every bill that needs

47:18

that needs to be paid is

47:21

getting paid We've got a little

47:23

bit extra for things that might

47:25

pop up Okay, you know any

47:28

unexpected medical bills. I do thankfully

47:30

have health insurance, but good You

47:33

know, babies are expensive. So just

47:35

how much is left over right

47:37

now? Once you cover all of

47:40

your basic bills minimum payments on

47:42

the debts, how much extra is

47:45

there? It winds up not feeling

47:47

like a ton I want to

47:49

say like a ballpark of maybe

47:52

a thousand a month? You're telling

47:54

me you guys are spending nine

47:57

thousand dollars a month? I

48:00

think so and I think part of the,

48:02

well, maybe not problem, but part of what

48:04

we've been doing is paying down on previous

48:07

personal loans that were really high. So we've

48:09

been paying on those really aggressively. If we

48:11

were to just stop paying all the extra

48:13

on the debt, that would be significantly less

48:16

going out every month. I mean, I think

48:18

we'd probably have. four or five thousand left

48:20

over. Okay, that's good news. So here, if

48:22

I'm in your shoes, here's what I would

48:25

do. Once you're actually pregnant, it's fine to

48:27

go into stork mode and just stack up

48:29

cash. And two grand a month for the

48:31

nine months of pregnancy, you'll have 18 grand

48:34

sitting in that one account. Okay. And so

48:36

that'll get you by for those months. Yeah,

48:38

that's just the basic math. What I wouldn't

48:40

do is go, well, we don't know, so

48:43

let's just start saving now and not paying

48:45

on our debts and just make minimum payments.

48:47

I would continue the debt snowball until we

48:49

go, all right, game on, nine months until

48:51

baby, then I would pause and stack up

48:54

cash. Once you and baby are home safe,

48:56

you're done with leave, you've got the money

48:58

left over, start chunking out at the debt

49:00

at the debt and push play on the

49:03

debt and push play on the debt snowball

49:05

on the debt snowball on the debt snowball.

49:08

Okay. Yeah, and real quick question. What

49:10

is your hubs getting his degree in?

49:12

He's studying sociology right now, although the

49:14

plan, a dentist for him to go

49:16

to law school and then probably commission

49:18

is not there back into the military.

49:20

Yeah, as a part of this plan,

49:23

I always like to throw something out

49:25

for people to think about. I'm not

49:27

suggesting that he do this or that

49:29

you all do this, but I would

49:31

sit down and talk about it. I

49:33

would entertain what a gap could look

49:35

like between his undergrad and law school.

49:37

There is this drive in America. I

49:39

don't see it anywhere else. It is

49:41

such an American cultural pressure to, I

49:44

gotta knock it all out. as fast

49:46

as I can, I'm going to slog

49:48

through it, I'm going to come out

49:50

on the other side with all these

49:52

degrees, and then you're saying he may

49:54

actually go into the military. It didn't

49:56

sound like he needs a lot to

49:58

agree to do that. It does. And

50:00

so especially with that little wrinkle you

50:03

threw at me, why not go work for

50:05

a year or two? And again,

50:07

kind of bring in some more

50:09

income and let's fast forward our

50:11

financial progress and law school is

50:13

always going to be there. The other

50:15

thing that I would recommend is that

50:17

he work really hard on getting a

50:20

strong LSAT score because we know for a

50:22

fact, I've proven this over and over again,

50:24

you can do some research to check me

50:26

on this because I'm right. but there are

50:29

a lot of smaller lesser known law schools

50:31

that will give your husband a full ride

50:33

uh... if he gets a very high ill

50:35

set score so these are things to be

50:38

thinking about as opposed to just going to

50:40

the motions of what we're gonna grid our

50:42

teeth and stay on one income and especially

50:44

if babies there now i would just have

50:46

a conversation about that that's all i'm

50:48

suggesting Yeah, I think that's really fair

50:51

and I appreciate all of the advice

50:53

and your time. Thank you so much.

50:55

Yeah, you bet. Appreciate the call. And look

50:57

at the basic napkin math on this too,

50:59

Emily. Five grand a month thrown at this

51:01

debt, you're done in two years. Yeah. It's

51:03

120 grand. It's a lot. But you

51:06

just told me you could free up

51:08

four to five grand if you guys

51:10

got intentional, got on a budget. And

51:12

so that's my goal for you guys

51:15

is two years. Now this is aside

51:17

from if you get pregnant. Even easier

51:19

by the way George if his income

51:21

goes up. Boom. Now it's like 18

51:24

months. And that's why I'm presenting the

51:26

idea of a pause between graduate

51:28

school. Especially when you're in debt.

51:31

Get out of debt George is

51:33

my play. Well, George and I

51:35

will continue to talk that philosophy.

51:38

And, you know, very socratic. So,

51:40

I like that. It's very good. All

51:42

right, Dave, you have some

51:44

strong opinions. Possibly,

51:46

yeah. I think so. Okay, because you

51:49

really prefer credit unions over

51:51

big banks. So why is

51:53

that? Well, credit unions, for

51:56

one thing, are non-profit, which

51:58

means that the... members, the

52:00

customers own the credit union. So any

52:03

profits that the credit union makes goes

52:05

back into customer pricing. So you get

52:07

better interest rate on savings, cheaper checking,

52:09

and so on, that kind of thing.

52:12

But what's more important than that though

52:14

is the fact that the customer is

52:16

the owner changes the spirit on the

52:19

credit union. So I find very few

52:21

credit unions that aren't very customer-centric. Yes,

52:23

well, and I think we have found

52:25

one that is incredible and that's fair

52:28

wins. They are an incredible credit union

52:30

that is really out with the heart

52:32

to help the customer. You know, that's

52:34

why we're partnering with them. because they've

52:37

got a scope to be able to

52:39

handle the Ramsey audience and they're the

52:41

right kind of people with the right

52:43

kind of values. And they've done a

52:46

really, really good job with customer service

52:48

and the deals that they're offering, the

52:50

Ramsey tribe is incredible. Yeah, absolutely. And

52:53

you're right, their customer service is unbelievable.

52:55

Winston and I just signed up and

52:57

we got an account. Yeah. And I'm

52:59

not kidding. It took less than five

53:02

minutes. It was so user-friendly, like the

53:04

step-by-step approach was unbelievable. And then the

53:06

next day, my phone rings and it

53:08

says fair winds on my phone. So

53:11

I answered it and talked to someone

53:13

there and they said, yeah, they give

53:15

calls to every new customer. And so

53:18

again, they just really care about your

53:20

experience. And I so, so appreciate that.

53:22

So again, you guys, I know it

53:24

could be a pain to switch banks

53:27

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53:29

fair wins. Again, they make it so

53:31

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fairwinds.org/Ramsey to learn more. That's FAI. rwinds.org/Ramsey.

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It may not be available in all

54:48

states. Today's question comes from ERISA in

54:51

Oregon. My husband and I are working

54:53

hard to pay off our debt. We

54:55

set our budget each month and try

54:57

to stay with it. Our problem is

55:00

that we have way too many auto

55:02

withdrawals coming out of our accounts. I

55:04

started a calendar to track our finances,

55:07

but that doesn't seem to help. What

55:09

advice do you have regarding budgeting for

55:11

scheduled? Withdrawals. Oh my goodness. I don't

55:13

know that I've ever seen a question

55:16

more teed up for you. I think

55:18

Ken fell asleep while I was my

55:20

second reference of withdrawals. He was like,

55:22

I'm losing it. Okay, this is actually

55:25

a good question. It's a really good

55:27

question. It's very tactical, but I think

55:29

this will help a lot of people

55:32

out there who are also struggling with

55:34

this. So when you have auto withdrawals,

55:36

they're on auto pay, the electric bill

55:38

is going to come out on the

55:41

17. you're setting your budget. I don't

55:43

know what budgeting method you're using. You

55:45

didn't mention that. I personally use the

55:47

every dollar budgeting app. You can jump

55:50

on there and use that for free,

55:52

get it in the app store. And

55:54

what I love about this is that

55:57

you can set the due dates with

55:59

each item in the budget, each transaction,

56:01

and you can have reminders in there.

56:03

And so one thing you can do

56:06

is with the premium version, there's a

56:08

paycheck planning tool where you can see

56:10

exactly when you're going to run out

56:12

of money based on when those bills

56:15

are coming out. And then the process

56:17

would be. Call the utility company, get

56:19

online, and you can change the payment

56:22

date within a certain window and to

56:24

say, hey, I need this to come

56:26

out on the 16th instead of the

56:28

14th, so that it can come after

56:31

the next paycheck and not before. And

56:33

that will help you over time, and

56:35

it sounds like you guys are also,

56:37

you're running it real tight right now,

56:40

I would keep a buffer of a

56:42

hundred bucks, two hundred bucks, three hundred

56:44

bucks in your checking account. so that

56:46

you're not running up to zero and

56:49

overdrafting. That's what you want to avoid

56:51

here. So doing all of that will

56:53

help and over time it's going to

56:56

get easier as you understand when these

56:58

bills are coming out. But doing that

57:00

every dollar budget is really going to

57:02

help you understand. Paycheck one hits here,

57:05

here's all the bills that come after

57:07

it. Here's all the bills that come

57:09

after it. And over time you'll get

57:11

it dialed in and you'll start making

57:14

that progress. But speaking of every dollar

57:16

we have multiple free trainings these are

57:18

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57:21

this month you can live excuse me

57:23

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57:25

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57:27

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57:30

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57:32

talking through the every dollar budget app

57:34

over 160,000 people have signed up already

57:36

join it. It's free. Go to every

57:39

dollar.com/webinar. Macon Georgia is where Alan is

57:41

waiting for us. Alan how can we

57:43

help today? Hi I just had a

57:46

question for you guys needed to know

57:48

if my plan I know nothing about

57:50

really you guys is just I'm an

57:52

idiot for how much of it is

57:55

I'm an idiot to try to get

57:57

everything straightened out financially. Well don't beat

57:59

yourself up too much. You don't know

58:01

us and yet you decided to call

58:04

us. So somebody close to you

58:06

said, Allen, call these guys. Am

58:08

I getting this right? Yes, you guys

58:10

have been referenced to me before

58:12

by a co-worker over a year

58:15

ago. I wrote it off as

58:17

nothing and then was like, oh

58:19

boy. Maybe there's something to it.

58:21

That tells us actually how desperate

58:24

you are. Fine. A year later.

58:26

I'm desperate. I'm going to call

58:28

these clowns and see if they're

58:30

going to help me. We'll do

58:33

our best. We will do our best.

58:35

Give us a little bit more

58:37

detail here on the real

58:39

problem. All right. So me

58:41

and my wife are pregnant.

58:43

Well, I'm not. She is.

58:45

Thanks for clarifying that. Pretty

58:47

soon. Pretty soon. I talked to

58:49

try to file bankruptcy that cost

58:51

over two grand so I didn't

58:53

do it. They estimated me at

58:55

about 12,000 in debt and that's

58:58

including her car. I don't have

59:00

one. You try to file bankruptcy

59:02

over 12 grand? Yeah. Now I

59:04

told you I don't know what I'm doing,

59:06

how much of an idiot I am.

59:08

I don't know. No, let's stop. I'll

59:10

tell you this. Bankruptcy is not your

59:13

answer. You guys are the solution to

59:15

this problem. And so we're going to

59:17

get you out of it. You're

59:19

working full-time? Yes, my hours

59:21

vary and so does my paycheck.

59:24

It's highly inconsistent. What

59:26

kind of work are you

59:29

doing? Geotechnical field technician.

59:31

That sounds really fancy. What

59:34

does that mean? Um,

59:36

summed up construction needs testing done

59:38

before they can build or any

59:40

of that. I run a bunch

59:42

of tests. Um, but that's not

59:45

a consistent 40 hour a week

59:47

gig. Sometimes it can be just

59:49

below 40 hours. I'll make less than

59:51

400 or 500 bucks. Sometimes I'm working

59:54

almost 60 hours. Still make less than

59:56

$800. I'm so confused. What is your

59:58

is it an hour? rate? Who's setting

1:00:01

this? It's 15 an hour. Okay I

1:00:03

think you need to be making more

1:00:05

money doing something. Better job, better job.

1:00:07

So let's just check out. My mom

1:00:10

told me today that he was looking

1:00:12

to give me a raise soon but

1:00:14

has no idea how much or how

1:00:17

little it'll be. Does that not like

1:00:19

that just makes my head hurt listening

1:00:21

to that entire sentence? Right, but I'd

1:00:23

come back to them because we'd moved

1:00:26

back up to Georgia from Florida because

1:00:28

that was a bust at every avenue

1:00:30

and they were the only place I

1:00:33

could find to go back to work

1:00:35

for. I did get my real estate

1:00:37

license in Florida and I got the

1:00:39

paperwork printed out to transfer it up

1:00:42

here. So my plan is to try

1:00:44

to get... What time I have not

1:00:46

working? Because I could work through the

1:00:49

weekend at a moment's notice. You get

1:00:51

told at the end of the day

1:00:53

whether you got to be at work.

1:00:56

Hey, Alan, Alan, Alan, Alan. You're making

1:00:58

too many excuses as to why you're

1:01:00

stuck. This whole... I'm where my plan

1:01:02

comes in is... I want to get

1:01:05

into the real estate and find a

1:01:07

secondary gig, put all my time into

1:01:09

it. That is a luxury. You need

1:01:12

money now. Yeah. Not I hope to

1:01:14

make a commission seven months from now

1:01:16

to sell my first house. Yeah. I'd

1:01:18

be working 60 hours a week doing

1:01:21

retail and you'll make more. Yeah. That's

1:01:23

absolutely right. You can get, you can

1:01:25

be making $20 an hour stock and

1:01:28

shelf somewhere at this point. You've got

1:01:30

to get really intentional. This whole, I'm

1:01:32

an idiot act. It's a function of

1:01:35

I can be very straight with you.

1:01:37

You're making a lot of excuses. And

1:01:39

George is right. You presented us with

1:01:41

$12,000, which in the grand scheme of

1:01:44

things, my friend, is not a lot

1:01:46

of money to pay off if you

1:01:48

have intentionality. In other words, a much

1:01:51

better paying job, and then you do

1:01:53

what George tells you to do to

1:01:55

pay it off. The debt mathematically is

1:01:57

not your issue here. Absolutely. I understand.

1:02:00

I just started getting real with these

1:02:02

things like a wake. up this week

1:02:04

so I knew I had nothing together.

1:02:07

All right well listen to George here

1:02:09

I think here's how we pay his

1:02:11

what happened. You got a baby on

1:02:14

the way and it was a reality

1:02:16

check and you went oh my goodness

1:02:18

I got to be like an adult

1:02:20

all of a sudden right yes and

1:02:23

your wife is feeling the stress too.

1:02:25

Is she currently working? She doesn't care

1:02:27

about money. She does when she doesn't

1:02:30

have it and she can't feed her

1:02:32

baby? She's got to start caring. Walking

1:02:34

through how he gets out of this.

1:02:36

Listen, Allen paid attention like you've never

1:02:39

paid attention to anything else in your

1:02:41

life. You need income ASAP. The debt,

1:02:43

I'm guessing the minimum payment is a

1:02:46

few hundred bucks? Yes, sir. Okay, and

1:02:48

you owe 12 grand, and it's a

1:02:50

car? It's a couple of things. A

1:02:53

credit card, her car, a lawyer from

1:02:55

a previous divorce, that's only two grand

1:02:57

didn't even use them. And what's the

1:02:59

car worth and what do you owe

1:03:02

on it? I believe she said the

1:03:04

car's worth like 20 something 30 and

1:03:06

she it should be paid off next

1:03:09

year. No, what do you owe on

1:03:11

the car? I think like seven. You

1:03:13

need to sell that car today. It's

1:03:15

worth 30 grand and you owe seven?

1:03:18

I think that's what she said last

1:03:20

time I asked her about it. So

1:03:22

you can make 23 grand from this

1:03:25

sale, use that to pay off the

1:03:27

rest of your debts and still have

1:03:29

money left over to buy another car

1:03:32

used in cash. You hear that? You

1:03:34

just solve the problem right there, Alan.

1:03:36

And then the next step is, let's

1:03:38

get our income up and start stacking

1:03:41

up cash that we have some when

1:03:43

the babies here. You guys are going

1:03:45

to be debt free with an emergency

1:03:48

fund by the time this time this.

1:03:50

And then you will be on the

1:03:52

Ramsey train on the path to building

1:03:54

wealth. And Alan, let's change the label.

1:03:57

You're not an idiot. You're a good

1:03:59

man. You're a husband. You're a father.

1:04:01

You're a hustler. Take a label, own

1:04:04

it, and go happen to this situation.

1:04:06

George just gave you the game plan.

1:04:08

I'd be listening to that car in

1:04:11

the next five minutes. I hate to

1:04:13

admit this, but I don't always eat

1:04:15

right. I know. I need to eat

1:04:17

more fruits and veggies, but sometimes I

1:04:20

just have to pound some chips because

1:04:22

they taste so good. That's why I

1:04:24

love my field of greens. It helps

1:04:27

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1:04:29

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1:04:33

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1:04:36

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1:04:38

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1:04:40

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1:04:43

is the great part of it I

1:04:45

thought it might taste like grass but

1:04:47

it tastes great and only field of

1:04:50

greens makes this promise your doctor will

1:04:52

notice your improved health or your money

1:04:54

back so Go to Field of greens.com/Ramsey

1:04:56

for 20% off your first order. That's

1:04:59

Field of greens.com/Ramsey to save 20% on

1:05:01

your first order. Let's play a game.

1:05:03

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1:05:06

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1:05:08

can't actually see any of you, but

1:05:10

I can feel it in my bones

1:05:12

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1:05:15

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1:05:17

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1:05:38

solutions.com/Smart Tax. In the lobby of our

1:05:40

Ramsey Solutions headquarters here, just across the

1:05:42

studio here, through the glass, on the

1:05:45

debt-free stages, Rachel, welcome Rachel. Hi, thanks

1:05:47

for having me. You bet where you're

1:05:49

from? I'm from Dallas, Texas. All right,

1:05:51

and you're here to do your debt-free

1:05:54

scream, I'm told? So exciting, okay, give

1:05:56

us the data here, how much debt

1:05:58

did you pay off? $65,000. Okay and

1:06:01

how long? It took 14 months.

1:06:03

All right way to go and what

1:06:05

was your range of income

1:06:07

during that time? It started at

1:06:09

about 105 up to 115,000. What

1:06:11

do you do for a living?

1:06:13

I'm a director of revenue for

1:06:16

a hospitality management

1:06:18

company. Oh nice and was the

1:06:21

bump due to side work or just

1:06:23

a raise at your job? It was

1:06:25

mostly from starting a side

1:06:27

hustle at a gym. No, you

1:06:29

started a gym? Oh, no, no. Oh, okay.

1:06:31

I'm sorry. I work at a gym. Okay,

1:06:33

I was gonna say, that's quite the

1:06:35

side. That's impressive. I was about ready

1:06:38

to be blown away. On a way

1:06:40

I started a gym. Yeah, fun stuff.

1:06:42

All right, so take us back to

1:06:44

14 months ago when you started this

1:06:47

journey. What led to this? I had

1:06:49

been... With my boyfriend for a

1:06:51

while, seriously dating, and we

1:06:53

started to have deeper conversations

1:06:55

about what we wanted our

1:06:57

future to look like, and

1:06:59

I just started to realize

1:07:01

that the path I was going down

1:07:03

was going one way, and the path

1:07:05

I said I wanted to go down

1:07:08

was another way, and something needed to

1:07:10

bridge that together. decided to

1:07:12

get serious about paying off debt.

1:07:14

It was a good time, no

1:07:16

spouse, no kids, just a good

1:07:18

time to hustle and lay a

1:07:20

good financial foundation. Now how did you

1:07:23

hear about what we're doing here? uh...

1:07:25

started with my parents giving me a

1:07:27

p u okay right after i left

1:07:29

college with six figures of debt oh

1:07:31

boy wow good luck to you yes

1:07:33

i got i got to ask i don't

1:07:35

want to i don't want to belabor it

1:07:38

or stay here too long but when you

1:07:40

had this conversation with the boyfriend and you

1:07:42

said i realized i was going down one

1:07:44

path i wanted to go another Did he

1:07:46

come along for the journey or was he

1:07:49

out? Oh yeah, no, he was so

1:07:51

excited and definitely on board. You

1:07:53

know, obviously our finances are not

1:07:55

combined, but we hustled together. So

1:07:57

he's still around. Oh yes, very

1:07:59

much. You left us on a cliffhanger

1:08:01

there. Yeah, so he was supportive. Yes,

1:08:04

he is. Shout out to Ryan. Shout

1:08:06

out to Ryan. Your good boyfriend sounds

1:08:08

like to me. Yeah. So was he

1:08:10

on the debt-free journey too? Or did

1:08:12

he not have debt? Yeah, he's still

1:08:15

on the ride. You beat him to

1:08:17

it. So that's good. Yeah. So what

1:08:19

kind of debt was the 65? Oh,

1:08:21

it was the all-American variety pack. I

1:08:24

had student loans, multiple credit loans, multiple

1:08:26

credit cards, Wow, good for you. Little

1:08:28

potpourri of debt there. So what did

1:08:30

it look like intensity wise for you

1:08:33

when you jumped it all in to

1:08:35

knock this debt out? What were you

1:08:37

doing? What cuts that you made? Give

1:08:39

us a sense of what the journey

1:08:41

was like. I think the biggest piece

1:08:44

was writing a budget. for the first

1:08:46

time in my adult life. So that

1:08:48

was a huge game changer and then

1:08:50

really learned to track where my spending

1:08:53

was going and cut out all of

1:08:55

the non-essentials. And I think another big

1:08:57

piece for me was initially doing the

1:08:59

numbers and finding an end date. that

1:09:02

I could focus on. You know, like

1:09:04

if I can just stay intense for

1:09:06

14 months and that really kind of

1:09:08

helped just to see where the finish

1:09:10

line was. I love that. So it

1:09:13

wasn't just a never-ending journey, there was

1:09:15

a destination and you know where it

1:09:17

was. And so if it's like you're

1:09:19

going on a road trip, you know

1:09:22

the ETA. And that's what that did

1:09:24

for you, having that goal set and

1:09:26

going for it. And did you stay

1:09:28

on track the whole time? Did you

1:09:31

exceed your goal? I met my goal.

1:09:33

It was to pay it off by

1:09:35

December 31st of 2024 and I hit

1:09:37

it. Boom. I got a feeling that

1:09:39

that's not abnormal for you. Are you

1:09:42

one of those people that sets a

1:09:44

goal and goes and gets it? You're

1:09:46

like a super achiever? I love that.

1:09:48

Where does that come from, do you

1:09:51

think? Oh, I'd say both my parents,

1:09:53

I would say. My mom's the analytical

1:09:55

one and my dad was the creative

1:09:57

mind, but both of them goal-driven. Yeah,

1:10:00

and I've got to point out for

1:10:02

our audience, the viewing audience can see

1:10:04

this on YouTube if we can lock

1:10:06

in, but Rachel, you've got some customized

1:10:08

genes, which I'll be honest, normally I'm

1:10:11

a little bit worried about, but I

1:10:13

think you nailed those. Walk us through

1:10:15

what's happening there. Thank you. These are,

1:10:17

in case I forget why I'm here.

1:10:20

Yeah, a dead free pants. Uh-huh. And

1:10:22

how did you go about doing, is

1:10:24

that hand-stitched, is embroidered? Yep, I just

1:10:26

went to Goodwill, bought some jeans, and

1:10:29

then I cut up and sewed another

1:10:31

pair on top of these. No way!

1:10:33

Did it yourself? Yeah. Did you self-teach

1:10:35

or were you already taught in the

1:10:37

art of sewing? I was taught by

1:10:40

my mother when I was growing up.

1:10:42

Way to go, Mom. I think this

1:10:44

could be your next side hustle. Maybe.

1:10:46

It's making personal finance themed clothing. How

1:10:49

much did the jeans cost at goodwill?

1:10:51

Eight bucks. Eight dollars, George. That's your

1:10:53

kind of jeans right there. That is

1:10:55

thrifty. Wow, I love this so much.

1:10:58

So what's next for you now? You're

1:11:00

deaf-free, you're still young, you got time

1:11:02

on your side? Yeah, I'm just enjoying

1:11:04

life. Obviously coming here was a... Exciting

1:11:06

opportunity and have a few trips planned

1:11:09

later this year and really just continue

1:11:11

to save for the future. And we

1:11:13

think Ryan's going to finish his race

1:11:15

soon, yes? What is he expected to

1:11:18

be debt-free, do we know? Sometime this

1:11:20

year. Oh boy. Do we think he's

1:11:22

going to pop the question? What are

1:11:24

we talking about? We'll see. You don't

1:11:27

know? It's not that serious yet? He's

1:11:29

actually not there. Sorry, right. George, look

1:11:31

what you did. I'm sorry. All right.

1:11:33

So one of the questions we'd love

1:11:35

to ask those who step on that

1:11:38

stage, who have finished this journey, is

1:11:40

what was the key for your particular

1:11:42

journey to get debt free? What would

1:11:44

you say that is? I think the

1:11:47

budget just played such a big role

1:11:49

assigning every dollar a place so that

1:11:51

it didn't just disappear. And then, for

1:11:53

me, a little bit more person. I

1:11:56

would say, just not feeling the need,

1:11:58

I'm a people-pleaser, and so it was

1:12:00

very difficult to feel like I was

1:12:02

letting people down by saying I couldn't

1:12:04

do certain things or attend certain, you

1:12:07

know, important moments in other people's lives,

1:12:09

and that was tough, but. The weddings,

1:12:11

the birthday parties, the girls' trips, it

1:12:13

had to be, hey, I'm on a

1:12:16

journey, you guys know, I'm going to

1:12:18

become debt-free. Yeah. And now they're going

1:12:20

to be asking you questions going, going,

1:12:22

hey. Tell me more about that plan

1:12:25

you did because we make like the

1:12:27

same money and I got all this

1:12:29

debt And if it worked for you

1:12:31

could have worked for me. Have you

1:12:33

been encouraging friends now? Yeah, that's been

1:12:36

a really cool piece to this as

1:12:38

well as seeing others that I've inspired

1:12:40

to start this journey as well And

1:12:42

yeah, now I get to cheer them

1:12:45

on speaking of being cheered on we

1:12:47

see mom over there Besides mom who

1:12:49

else were some big cheerleaders for you

1:12:51

on this journey? My family, I have

1:12:54

some siblings back home in San Antonio

1:12:56

and people from work, obviously my boyfriend

1:12:58

Ryan. That's awesome, so fun. We got

1:13:00

a little gift for you, a parting

1:13:03

gift, two every dollar premium subscriptions, good

1:13:05

for a year. You can use those,

1:13:07

you can pass them along to one

1:13:09

of the friends you're encouraging, and that's

1:13:11

our parting gift for you joining us

1:13:14

here in Nashville. Amazing, thank you. And

1:13:16

I think you've modeled this. I want

1:13:18

to remind people as they're listening to

1:13:20

your story. It's so much easier to

1:13:23

say no on the debt free journey.

1:13:25

No to all the friends, no to

1:13:27

all the invitations when you've already said

1:13:29

yes to getting out of debt and

1:13:32

yes to this process. You make that

1:13:34

decision first, the no's become a lot

1:13:36

easier. I'm just saying that for all

1:13:38

recovering people pleasers like myself. I mean,

1:13:40

that's so key. Love your story, Rachel.

1:13:43

And it can be done. What would

1:13:45

you say to young people who think

1:13:47

maybe it's not possible to pay off

1:13:49

$65, and 14 months? It absolutely can't

1:13:52

be done if you stay intentional and

1:13:54

really just fight for the life you

1:13:56

deserve and can be easy. to see

1:13:58

you know social media or society trying

1:14:01

to serve you up what you think

1:14:03

is a good life but just knowing

1:14:05

what you want and staying true to

1:14:07

that. Well you did, you knew what

1:14:09

you wanted and you stayed true to

1:14:12

it. We're so proud of you. Thanks

1:14:14

for sharing your story. All right, the

1:14:16

moment has come Rachel. You've worked so

1:14:18

hard for this. Rachel from the Dallas,

1:14:21

Texas area, she paid off $65,000 in

1:14:23

14 months making, $105,000 all the way

1:14:25

up to $115. You know what to

1:14:27

do. Take it away. It's time for

1:14:30

your debt-free screen. Three, two, one, I'm

1:14:32

debt free! She is, she did it

1:14:34

folks. I love it. She is debt

1:14:36

free. And normally have Mel Gibson screaming

1:14:38

from, so we need you to do

1:14:41

your best. Freedom! Very good, George. That's

1:14:43

as good as against. All you need

1:14:45

is some blue face. There it is.

1:14:47

There we go. Who did it better?

1:14:50

Who did it better? I don't know.

1:14:52

I think you did it better, George.

1:14:54

I might trade in my skinny jeans

1:14:56

for some of those right there. I

1:14:59

want to see a good will and

1:15:01

get yourself prepared jeans for less than

1:15:03

10 bucks. How about that? That's what

1:15:05

I want. That's your homework assignment this

1:15:07

weekend, George. I'll leave the embroidery to

1:15:10

Rachel. What a choice. Good choice. Are

1:15:13

you sick and tired

1:15:15

of being sick and

1:15:17

tired? You can take

1:15:19

control of your money

1:15:22

and your relationships. And

1:15:24

it starts with just

1:15:26

one night. Join me

1:15:28

and Dr. John Deloni,

1:15:30

live in a city

1:15:33

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1:15:35

Money and Relationships tour.

1:15:37

We're covering the real

1:15:39

life stuff that matters.

1:15:41

So you can break

1:15:44

the cycles that have

1:15:46

left you stuck. It's

1:15:48

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1:15:50

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1:15:59

today. joining us here in

1:16:01

Nashville. Doug, how can we help? Hey

1:16:03

guys, thanks for taking my call.

1:16:05

I've got a question. I'm 100%

1:16:08

stumped on what to do. I'm

1:16:10

currently in about $7,500 a month

1:16:12

worth of mortgage debt. It's two

1:16:14

more mortgages. The first one's about

1:16:16

$3,000. The second one's $4,500. I

1:16:19

live in the one is my

1:16:21

primary residence. The other one I'm holding

1:16:23

on to. It's renting out, but it's

1:16:25

losing money every month. So I don't

1:16:28

know whether I hold the property and

1:16:30

wait for it to appreciate and just

1:16:32

whether the loss or and take the

1:16:34

tax deduction from it every year from

1:16:36

the interest or do I look to

1:16:38

sell the property and I won't recover

1:16:40

what I put into it so I'm not

1:16:42

going to be recovering my closing costs

1:16:45

or any of my down payment. I

1:16:47

basically break even if I sell it.

1:16:49

I bought it at the height of

1:16:51

the market. You are the violinist on

1:16:53

a Titanic man. You're going, hey, we're

1:16:55

going to play until the ship goes

1:16:57

down. Get off the ship, man. Get

1:16:59

off your bleeding money. You're just breaking

1:17:02

blood pressure issues, Doug. Just setting that

1:17:04

up, George is having a reaction over

1:17:06

here. I know, I know. But I look at

1:17:08

it and I say, hey, you know, I'm

1:17:10

saving a little bit maybe from the tattoo.

1:17:12

You're drowning. It's called a sunk cost fallacy.

1:17:15

It's fallacy. I put money into this, I

1:17:17

was hoping it was going to work, take what

1:17:19

you can get out of it, and call it

1:17:21

a stupid tax and move on with your life.

1:17:23

You took on a lot of risk and it

1:17:26

didn't pan out. And that's okay, we've all done

1:17:28

stupid stuff, I'm not here to beat you up,

1:17:30

but I'm telling you man, now is the time to

1:17:32

get out. So do my calculations matter on this?

1:17:34

Because I've basically looked at if I hold

1:17:37

on to this property at a three and

1:17:39

a three and a half percent appreciation over

1:17:41

the next three years. I can pull my

1:17:43

money out. I can get what I put

1:17:45

back into it. You're going to be calling

1:17:47

us back saying I'm doing even worse now.

1:17:49

I thought it was going to work out.

1:17:51

None of the calculations make sense. This is

1:17:53

a third grade math problem. You are bleeding

1:17:56

money every single month. Get out while you

1:17:58

can. It's only going to get worse. I don't...

1:18:00

anything to hang on to a stupid

1:18:02

interest rate and it's only going to

1:18:04

harm you in the long run to

1:18:06

stay in this thing. Okay. I know

1:18:09

you'll be sad to lose your interest

1:18:11

rate but at least you won't be

1:18:13

bleeding money out because you're losing money

1:18:15

even if it was breaking even it

1:18:18

would still be a bad idea but

1:18:20

you're losing money on this thing every

1:18:22

single month what's your income right now?

1:18:24

Income right now I make a decent

1:18:26

income I bring home about 220 net.

1:18:29

Amazing. And so this is not money

1:18:31

you even need, even if it was

1:18:33

working out. It's still not worth a

1:18:35

spread. Well, and I think, yeah, the

1:18:37

thing is, I think with my higher

1:18:40

income, I feel like, hey, it's not

1:18:42

that big of a bleed every month,

1:18:44

and if I can make up this

1:18:46

money in the long run and then

1:18:49

sell it and get some of that,

1:18:51

you know, that cash back that I

1:18:53

put into it, but as Dave Ramsey

1:18:55

would say, you can outear your stupidity

1:18:57

for a long time. and so I

1:19:00

get that you don't feel it as

1:19:02

much in your budget because you're going

1:19:04

well I got margin but you're not

1:19:06

running a charity here if you want

1:19:09

to run a charity go start a

1:19:11

charity but you got into the real

1:19:13

estate business to make money and it's

1:19:15

not worth hanging on to the appreciation

1:19:17

it's not worth hanging on to it

1:19:20

for the interest rate I would just

1:19:22

get out and next time you buy

1:19:24

real estate do it in cash and

1:19:26

do some due diligence to make sure

1:19:29

that it will ROI for you. Well,

1:19:31

I have so I have the mortgage

1:19:33

of the course I have a vehicle

1:19:35

and Other than that. No, I actually

1:19:37

use a debt snowball paid off all

1:19:40

my credit cards paid off all my

1:19:42

medical debt paid off all my student

1:19:44

loans I paid off about $80,000 worth

1:19:46

of debt right? What's left on the

1:19:49

car we knew so? The car has

1:19:51

the truck is 35,000 left on it.

1:19:53

Okay, how quickly can you pay that

1:19:55

off once you get rid of this

1:19:57

house? Well, if I look at it,

1:20:00

you know, I'm so I'm currently contributing

1:20:02

and this goes into another question I'm

1:20:04

contributing to my savings plan through work.

1:20:06

You know, they match up to a

1:20:08

certain percentage. I'm putting away into a

1:20:11

high interest, high yield savings account every

1:20:13

month. I could take that money, stop

1:20:15

it, I could have it paid off

1:20:17

in a year. Because as it currently

1:20:20

sits, I'm about 3,000 a month cash

1:20:22

positive. Can I be honest? For a

1:20:24

guy who makes $2.20? My monthly... Making

1:20:26

$15 grand a month, aren't you? Right

1:20:28

now, about 10. What's that? Are you

1:20:31

making like 15 grand a month? Take

1:20:33

home? Yeah, about 16, 16 five a

1:20:35

month, roughly. I mean, basic math says

1:20:37

you can get rid of this thing

1:20:40

in a few months. 35 grand, throw

1:20:42

seven, eight grand at this thing, get

1:20:44

your expenses low, I think you've been

1:20:46

living high on the hog for a

1:20:48

long time now. Yeah,

1:20:51

I mean the income is I have

1:20:53

been but the income hasn't always been

1:20:55

there so I'm making up for all

1:20:57

the pain and suffering It's lifestyle great.

1:20:59

I finally yeah, I guarantee I kind

1:21:01

of realized it I finally realized it

1:21:03

You could be making 300 a year

1:21:05

from I finally kind of realized it

1:21:07

you could be making 300 a year

1:21:10

from now and you'd be making 300

1:21:12

a year from now and you'd still

1:21:14

have debt hanging around to any level

1:21:16

of debt and you can get rid

1:21:18

of this card free free free up

1:21:20

the payment get back to you have

1:21:22

an emergency fund in place so i

1:21:24

i do i have i have my

1:21:26

retirement you know investments of course i've

1:21:28

got about twenty five thousand in cash

1:21:30

amazing so you could be that for

1:21:32

even faster okay you could liquidate most

1:21:34

of that uh... savings throw at the

1:21:36

car that the truck and be done

1:21:38

in let's say two months sixty days

1:21:40

this truck is gone between your savings

1:21:42

and your cash flow and selling this

1:21:44

other property you're gonna be in a

1:21:47

really good place four or five months

1:21:49

from now if you follow this plan.

1:21:51

Okay. And then you can save up

1:21:53

and buy real estate real quick making

1:21:55

220 with no payments in the world

1:21:57

other than mortgage, which is reasonable considering

1:21:59

your income. So is it a 3,000

1:22:01

mortgage on your primary? No, the primary

1:22:03

is the 4,500. So, you know, yeah,

1:22:05

and just of course, given the market,

1:22:07

I mean, you know how it is

1:22:09

here, so it's difficult. That's a hefty

1:22:11

mortgage for sure, but it's doable if

1:22:13

you continue this trajectory. So, okay. You

1:22:15

got this dog. Well, I appreciate that.

1:22:17

There you go. I hope he follows

1:22:19

your advice. I think Doug's on the

1:22:22

fence. I really do. I think he's

1:22:24

trying to make it all work. And

1:22:26

I got riled up because he's too

1:22:28

successful to stay in this mess and

1:22:30

quagmire doing 17 things at once. No

1:22:32

question. It makes really good money. Yeah.

1:22:34

No need to play this out the

1:22:36

way it played out. But again, this

1:22:38

is what happens when we do calculator

1:22:40

psychology. Mmm, you know what I mean?

1:22:42

We start going, well, if I wait

1:22:44

three years, if I hold on to

1:22:46

it, then I get, you know, and

1:22:48

you start trying to calculate a thought.

1:22:50

Yeah. To try to bail yourself out

1:22:52

as opposed to actually bailing yourself out.

1:22:54

Yeah. Like you can't, you know this,

1:22:57

George. You write about this in your

1:22:59

book, breaking free from broke. But people

1:23:01

get into messes because they're trying to

1:23:03

shortcut wealth. And then they stay in

1:23:05

mess as longer because they're trying to

1:23:07

shortcut their way out of it. It

1:23:09

feels like we got too many shortcuts

1:23:11

and this was a, as I was

1:23:13

just sitting here listening, he's trying to

1:23:15

shortcut everything. Am I right? Yeah, I

1:23:17

was getting, I was getting riled up

1:23:19

and Ken, thank you for just peeling

1:23:21

back some layers. Somebody had to be

1:23:23

the voice of reason over here. Speaking

1:23:25

of, I got a clip I want

1:23:27

you to react to real quick before

1:23:29

this hour is up. I think you're

1:23:32

gonna have a really good take a

1:23:34

really good take on a really good

1:23:36

take on this. Can we're gonna have

1:23:38

a really good take on this. Can

1:23:40

we play a really good take on

1:23:42

this. Can we play it, James. Can

1:23:44

we play it, James? Here we go,

1:23:46

let's go, bus. Oh no. This is

1:23:48

me and Jade at 80s night on

1:23:50

the Ramsey cruise. This is a core

1:23:52

memory for me now. I did not

1:23:54

know this is... So now Jade and

1:23:56

I are both attempting to warm up.

1:23:58

You'll notice she's warmer than I am.

1:24:00

I look very stiff and uncomfortable on

1:24:02

us. It's kind of a weekend at

1:24:04

Bernie's vibe. You get... It almost looks

1:24:06

like a cadaver that's being moved. I

1:24:09

want you all to listen in. You

1:24:11

hear that cackling woman? That's my wife.

1:24:13

She thinks this is funny. Audience of

1:24:15

one. Now this is all ad lib.

1:24:17

Watch this move. There goes the fish

1:24:19

hook. There I am. Oh my goodness.

1:24:21

Jade has caught the tuna. Watch the

1:24:23

Slap! Oh man! If you weren't watching

1:24:25

that on YouTube or whatever, you gotta

1:24:27

get that on video, you can't just

1:24:29

listen, so I hope that convinces people

1:24:31

to tune in. And I gotta say,

1:24:33

Ken, you have some moves. And that's

1:24:35

generous. I was gonna say, that's one

1:24:37

way to describe them. There's no moves

1:24:39

at all. I didn't want to encourage

1:24:41

it, but I just thought this is

1:24:44

too good. Well, I feel like I

1:24:46

should get some context of this. I

1:24:48

did not set out. James for that

1:24:50

to have to win a dance battle.

1:24:52

No, no, I was a tagging along

1:24:54

with Jade Warsaw and my wife Stacey

1:24:56

They were Thelman Louise and I'm just

1:24:58

you know hanging loud. And all of

1:25:00

a sudden Michael Rettish, our dear friend,

1:25:02

he's on the mic, he goes, all

1:25:04

right, we've got two Ramsey personalities here,

1:25:06

let's get Ken Coleman Jade Warchild on

1:25:08

the dance floor for a dance off,

1:25:10

at which point I was already defeated.

1:25:12

Jade's got, Jade Warchild on the dance

1:25:14

floor for a danceoff, at which point

1:25:16

I was already defeated. Jade's got more

1:25:19

soul in her pinky finger than I

1:25:21

do. I was able to clap and

1:25:23

that won the crowd over. That's too

1:25:25

hot for TV. We can't even air

1:25:27

that. It's too much. It's too much

1:25:29

for the young men to see. Put

1:25:31

the women and children to bed.