Addressing Underpriced Real Estate Contracts

to you by the Every dollar app. Start budgeting for free today Normal is broken common sense is weird, so we're here to help you transform your life. From the Ramsy Network and the Fairwinds Credit Union Studio. This is the Ramsy showhow. I'm Dave Ramseay, your host, Rachel Cruise, Ramsay personality, number one best selling alor co host of the smart Money happy hour on Ramsay Networks, My daughter. She's my co host Erica is in South Bend, Indiana. Hi, Erica. Welcome to the Ramsay Sh Hi Davave. Hi Rachel. Hey, what's up Hey, so my question is I was just wondering what some steps were that you and Sharon took when you were young and working hard Um that your children did not resent you or your business onnce they were older Hm I did resent him. Don't justid.. that's a good question though. Are you, Erica, are you working a lot right now? you and your husband Yes, so I'm a stay at home mom and my husband is working a lot right now just trying to get us out of debt. we own to u two businesses and they're both in the food industry So there's a lot of a lot yeah, a lot of outd at time. Yeah. with that. How long have you guys been going at it at this pace? Has it been a while say three to four years So yeah, so you guys are you're in the thick of it, you're feeling it And you probably feel like a single mom A lot of the time. Yeah Yeah. So how much debad do you have left? How long How much longer is this journey going to be We business de we are at four hundred eighty six And then our personal house, we're at four hundred seventy thousand. That's all there is Okay, well both of those are baby step six Neither one of those require hours to be eighty hours a week If your eighty hour a week is to get your business up and running, that's a different equation What is it You're not working eighty hours a week to pal four hundred thousand dollars in debt No, it's not so much a money from a money standpoint for us as it's just U Finding good employees that can work U Yeah, like Welcome to business. husand Yeah Yeah in the food industry I was so gl when I first started nights and weekends. a lot of it's a hard, it's hard I was so dumb when I first started the business. I thought if you hired people, they would work But you have to hire people that are willing to work first and not just anybody. And that's the So welcome to running your business. So the deal here is he gets away from these hours When he learns to run the business instead of the business running him Mhm Meaning that he's got to get above cooking and get above production and get above waiting tables and get above general management and start to put some people in the seats that can actually do that I'll send you a copy of my latest best seller called Building a Business You loveo And he's at the treadmill stage, which is where everyone starts. You feel like you're on a treadmill, you feel like you're stuck run, run, run, run. But the way you get off the treadmill is hiring quality people that are delegatable. Maning they're humans that you can delegate to because you can train them because they have two brain cells and they have character and they have work ethic. And there's not that many of them. they're hard to find. But you can find them Okay And you must find them. othertherwise he will what he's doing right now is not sustainable You can't do that for ten years Yes. You run out of steam. Okaykay. That wasn't your question, but that's the answer. Now then back to the other thing is if we're solving for day that dad is not working eighty hours Then we just talk to the kids about that. We own our own business And for right now, until we get the people in and get them trained, I've got to be there And we had that period of time here when I was opening this business Yeah. How old are your kids Erica We have a two year old and another one on the way. Well, they're not repenting anything. You're exhaust. You're exhausted. You might be resenting something. They're not resenting anything. They just want their diaper changed Yeah, they're still young. Yeah This is this does not need to go onntil they're twelve. Not because of the kids, but because the business won't work Your husband will run out of steam. It's not sustainable. He's got to build the business out in such a way that by the time the time the kids are of age that they might actually resent it that he's already home. That does solve your problem. in general to answer your question is, we communicate that this is a price to be paid on a temporary basis to win. And for a two year old, Erica, I mean, I would say you're when he's home, he's home. likeike he needs to put his phone down He needs to play, engage with the two year old, you know? And and with you guys in your marriage, like I know during And it's not at the length that it is for you over years and years and years. But I know even for busy work seasons You're exhausted and your spouse almost gets your leftovers because you've just been giving all day. And so for you guys in your marriage, that's almost where I would put my focus and my energy first and foremost, because if you guys are connected If you guys are in sync and you guys are unified on the plan, thenen the household feels all of that, right? And so I think because mom and dad were such a great team and mom was Can I say bad I won't go for I don't know if we' alled to cuss on the air but she was she was an amazing mom. amazing mom and just took care of stuff. you know what I mean? in that in that season when we were little. And then as we got to be more middle school, I mean, dad, your job still required Long hours and travel I was going periodically book tours. Yeah, yeah, but there were periods of that. A book tour. But it would beone thirty days, not even home But That's communicated at that age, right? And we were older with all of that. But I think the presentness of Hving a solid marriage, the kids pick up on that. And and everyone pulling their weight, whatever that looks like. And then for the kids when you're just present in your home, and I'm guilty of this too coming home and cheheck in my phone and all of it right. So it's just like putting that away and being and him being present with your two year old is going to be big. And then you guys need to figure out a schedule. A some level that's doable when you have this next baby, baby number two. And so To feel supported in that, think I think is an important conversation Yeah They they're not If he's just turn on Daddy a few minutes a day at this age They're not going to be resentful. They're not going to have any memory of it By the time they get age that they age out, you the two of you need a plan You need to see a light at the end of the tunnel, but this business is maturing to the point that I'm going to have some some team members that I can delegate to that I don't have to fin it do everything And that's called training, hiring the right quality people, getting the right people on the bus, the wrong people off the bus, as Jim Collin says. And then it's not micromanaging to teach them to finish your sentences. That's called training I want this cooked this way. I want the customer spoken to in this way. I want eye contact and a smile. And when you finish, if you're work at Chick Fillet, it's my pleasure. And whatever it is, you train, train, train, train, train for the result you want. and the people that can't make the training, they don't get to stay U And so that's, you know, you as a leader learning to hire and learning to fire and start to build out your team with high quality individuals. And I've done that for forty years and I got a thousand of them in this building and I'm proud of every single one of them. I know that because if I wasn't proud of one of them, they wouldn't be in this building. It's all about practical ways to save time and mental energy, especially during the summer when life gets busy. Between vacations, camps, deliveries, travel plans, online shopping, and trying to keep everyone organized. my mental load can get pretty full. That's one of the reasons why I love Deletee. 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That's joinedeleiteme dot com slash Ramsey R Rachel, you haven't heard the story yet but the other day I had lunch with about twice a year I get with one of my high school buddies. There were three of us that ran around together did everything together in high school. And when I went off to college, I' glad they weren't.hones with cameras during those days. Thank God, there is no record of the things that we did. Yes, that's true. beyond belief. But anyway, one of the three passed away cancer last year and the other one and have a hamburger with at least twice a year. And he lives right here in the neighborhood, right here in the area and hang out with him. And the other day I was down there ha a hamurer with him and he said, I said, what are you been doing? He's single again and u I said, what you been doing? He goes, I just went on six cruises in the last little while. He goes, I'm addicted to cruising. You know what? you got to go on the Ramseay cruise. Is he coming? He signed up. Well, we're gonna go on the Ramsy cruise. L get there. So there we go, which I'm going to have to have him sign an NDA But we gave him a good deal on the room, but we're going to have him sign an NDA because we can't have any exposure on the Ramsy cruise. But if you don't know what this is, if you're debt free the live like no one else cruise is a high end very nice. This is not Walmart on the seas. This is the good cruise lines If you know what I mean, wink, wink. And this is the best of the best, the live like No one else crews. Hang out with all of us, all the Ramsay personalities will be there and other celebs of miscellaneous not to be mentioned yet. But we're going to do new sessions on there. Everybody's going to be speaking every night. We're the entertainment. we're doing all kinds of get togethers and hang out with you guys New sessions this year on buildilding wealth, live episodes of our shows. The world's largest debt free scream. We did it last time. We're going do it again. And last year we did it we did it, it'll be two years between the two cruises and we did it last March year ago March And this one will be next March. And It was It was really fun. It was great. It was a great week. and just I was a little bit worried about being trapped on a ship with three thousand Ramsay fans, right? That could be a long week for me. you know, that that could have gone sideways, but honestly, I had a blast. Yeah, it was great Shara and I we would just sit down and have dinner, we'd talk to people. was just had Best time, we really did. It was a lot of fun. So you can secure your cabin. they're not quite sold out, getting close with a six hundred dollar deposit and join us and my high school buddy. And we'll all be there and click the link in the show Redck for Mioch on a cruise. That's right.s what you need. You might be a rededneck if you're cruising with so and so and Dave, right? I'm not gonna to throw the guy on the bus, but now there we go So click the link in the show notes, go to Ramsys solutionsot com slash events, book your cabin. It will be next March. It will be sold out. You will be really foomoing. Now you do not come if you're in debt. This is only for baby step four and beyond We're not hypocrites. We tell you when you're in baby step one through, three, you're not going on vacation. This is a vacation. But if you've hit baby Step four and beyond and you can save up the money and you want to go on this night, this is Holland America. I mean this is a good line Caribbean C cruise It's going to be amazing. And But if you've saved up your money and you want to hang out with us for the week, it's an incredible week. You're going to learn a lot too because the sessions are incredible that we're teaching. So That was the funniest part is it really is a vacation. You could go all these islands. And so we have all these sessions booked out with things that you know we teach from stage and a couple things and I'm like, yeah, you know, the room might be like half full. I don't know. Most people I'm are O on the pool deck or at the island. I don't know you just assume people are vacation. Every session is packed. It's like faster to do devotionals in the mornings and you couldn't get in. Yeah. I mean, it was like everyone went to everything, which was so fun. It was a lot of fun All right, Samantha is in Toronto, Canada. Hi, Samantha, how are you Hi could thank you. How are you guys? Better than we deserve. What's up? So my husband has been doing his dream business board. Almost four years now And want to know because he hasn't really brought in any income from it. How long is it enough for me to support him in this over. you have a business that you ran for four years that doesn't make money. That's not a dream business. That's a nightmare. Yes, in my perspective it has't No in his perspective, I mean, it's a business. It's not a hobby. Wh's suppos Mike Mononey So what kind of business? is doing a couple of Tining is part of the gym ownership and they've just been putting Lots of efforts, even his partner has been doing some investments in it, but nothing yet. they have Pjections, but I'm tired of looking at projections of what could be. He's thinking of this business as our way out in the future, but it's hard to see in the future when right now for years we've been kind of struggling, right? For sure. Are you working, Samantha Yes. So for the past throughroughout the duration of our marriage, I've been a financial supporter and I was okay doing that But once we had our first son three years two and a half years ago still working. Yes. put in a completely different perspective and then have to go work back right away. And we've had many conversations of Why is the burden on me when and in his and then we come up with compromises But it still feels like and then we're having our second And now my worries that help we're back in a situation where we were with our force And I'm still at work. I'm doing we made some compromises of li situations. We could keep our cost down. We were at my parents So we're not really paying . Okay, so here's what needs to happen, Right Hey needs to sit down with his partners and proper business acumen would dictate that we see a pattern growth in the revenue and in the profits to get us to where we can eat out of this thing in a short period of time. So we need to see some directional move in the numbers. that give us hope He needs to do that, not you. And he doesn't need to do it for you and he need to do it because it's good business Okay. The byproduct is it's good for you because you get some hope too. No, she's saying that they've been doing that. know, they've been doing projections, but projections that aren't hit Okay And so that's not if we have a business unit at Ramseay that sets projections and they don't hit them Then we assess, okay How much longer do we go with not hitting projections and then we close it if it doesn't hit projections. you know, if you if you don't have a reason to believe other than just, I hope I wish But in business, you need to see some things move. I need to see I need to see some trend lines in my sales I need to see some. Yeah My fear is that they've been they've been. cropping themselves up thinking all these things. might And they might, but I want to it's not been real. But here's the difference.. Here's the difference. You need to set a deadline. He need to set a deadline withith you, Samantha. And he needs to come back and say, all right, we're going to go until this date At this date, we're going to see some profit And we're going to see some trendlines towards that day between now and then. What's killing you guys is this sense that there's no end this. And you got a second baby on the way. Well that's Samtha does does he not have any I know, but he's the dude. Apart me's not I don't want to fend your husband, Samantha I'm like mulch lawns. like go do something to bring an income for your wife and your baby and your soon to be baby. L that's wild to me Yeah For four years not making anything. Does he have any of that in him? Like is he is he Mad about it and he's angry and he wants to change this and that or is he just like I love it. It's been great. I don't know. We'll see where it goes. We're hoping the next thing's going to hit. So the compromise that we had because he wants to work around his schedule, but the gym he has to be pretty flexible is that he went back to school and here in Canada, the majority of the grads like we only had to take a loan because with our income but back to school to do what And he went back to school just to getting some grants so that you can just sustain us just a little bit. That's not an income The boy needs a job Yeah. O he needs a job. He needs the Rachel's rightide. He needs to go make some money and They need to set a deadline by which this gym and this member this this dream is profitable. otherwise it's not it's not going to stay open I'm not And I would challenge them be like, hey, yeah, we have six months or whatever you guys decide. want to sixix months comes to mind. And I want to see two big changes in the business. Like what are two drastically different things you're gonna do to be If I own the gym, you're gonna have to do something that makes me want to keep it open six more months. O I'm gonna to fire all of you and we're gonna close the thing. I'm sorry, Samantha. I'm sorry. That's tough. That's He needs to do that. and it's being exasperated by the fact that you are carrying a child and you're living your parents and you're living with your parents. I mean, all of it.'s a lot And I you have the right This needs to be needs to end. Yes, to fill urgenies make. It needs an end date. It need end date if it's not profitable. Yeah now When I started, I had great ideas and I knew how to serve people, but I didn't have systems in place yet. At that time I saw books out of the trunk of my car. It was a lot harder to start a business back then. Shopify makes it easier. Shopify is the business platform powering millions of businesses and about ten percent of all e commerce in the United States. If you've got a product or even just an idea, Shopify makes it simple to get moving. You can build a storefront, write product descriptions, and even improve your product photos all in one place. You don't need ten different systems taped together. Shopify handles everything you need to make sales from payments to marketing and analytics. Plus that purple shop pay button is one of the best converting checkouts on the planet for fewer abandoned carts And if you get stuck, Shopify offers twenty for seven support. So if you've been sitting on the sidelines, it's time to turn those ideas into Sign up for your one dollar per month trial at shopify d. com slash Ramsey. at shopify dot com slash Ramsey. Shopify d. com slash Ramsey. Land of the Free, the home of the Brave the best representation of free enterpcess system in the history of mankind called America And already two times this hour, the side hustle and the small business has risen to the point that they give us a question or two. This showour. So a couple things to remember if you're starting a side business or you're started a business Got a side hustle that's growing into a business. Here's some book recommendations for you. You ready? Write these down The premier book in the last thirty years probably that most of us love and we love the man too is our friend Jim Collins wrote the book good to Great You need to read that book You need to pick up the book byy Michael Gerber. It's called the E Myth, entntrepreneurial myth, E dash myth And in that book, my friend Michael says that you will either learn to work on your business or you will forever work in your business, which you just own your job then But if you learn to work on it then you can take a vacation and it keeps running while you're not there That's the proper growth of business, and that applies to both of our calls this hour U Our latest book Build a business you love is wonderful in this regard. It'll help you with laying these things out and help you recognize the stages of business as you go along And my friend Dr. Henry Cloud, who wrote the book Boundaries, also wrote a fabulous book called Necessary Endings. Everyone should pick that book up Because how do you know when to end somethingomething, a relationship, a marriage a career, a job, a business, a business unit employment of a team member needs to end O I don't want to work for this toxic boss anymore needs to end. How do you know? Well there's actual steps that you should go through a decision making framework and Henry walks you through. One of the core thing thesis and that is, if you lose hope that it's going to get better. So a horrible example would be you're married to an alcoholic and fourth time through rehab. and now they fell off the wagon again. Well, I lose hope that that one's going to get better and this marriage has come to an end That's an example But if you think it's going to be it better, then you know, real reasons pattern indicators, not wishes, not words, but actual behaviors and things happening in the revenue, if it's business, whatever it is. G me a reason to have hope and then we'll continue Necessary endings by Henry Clod. That's the fourth book. So some good books to help you guys along. And those are where I get some of the thoughts where Ramsy personersalities, get some of the thoughts we throw at you on side hustles, businesses, small businesses, our entree leadership materials. We coach about ten thousand small businesses if you're interested in that. You can find all of that at Ramsyslutions dot com d All right, Jean's in Montgomery, Alabama. Hi Je. How are you How you doing today, Dave? Better than I deserve. What's up First of all, I just want to say thank you guys for all the work you guys have done. I've been just started following you guys about a month ago. And I've I got my thousand dollars saved. I'm on baby step two R. I've listed all of my debts. Back in twenty. Thank you guys, seriously. Back in twenty twenty four, I didn't I messed up my taxes And I'm ten ninety ninears'm a truck driver and that year, I just filed my taxes and I owe them. and it's a twenty one thousand dollars balance that I owe them But I just started a debt snowball and I listed all my debts from largest to smallest and I I'm struggling to attack this twenty one thousand dollars. and I've been doing all the other ones. I've paid off so far, I've paid off three credit cards so far. and I like this momentum. but listening to the show the other day, you told one of the other callers to attack the IRS first, but it's just I'm staring at that mountain. and I don't know if you guys could kind of give me some direction or Should I just continue going from smallest to largest Okay, how much is that total The total debt that I have left over right now is eighty thousand three hundred and fifty six dollars. And twenty one thousand of it is the IRS. And what's the rest of it The rest of it, forty one thousand dollars is the student loans ten thousand dollars is on my wife's car and then I got five thousand on my daughter's car And I think another one. And I got eight thousand left on one more credit card Okay. And so You're going to be to the pretty quick. How much how much have you paid off so far and in what period of time So I've been following you guys for the last three months and in the last three months, I've paid off thirty three thousand fifty six dollars. Good for you, Gene Three months. Yeah. Yeah, I'm a truck driver. I'm well, if are you going to be able to maintain that pace I hope in the name of Jesus, I really do say be honest with you. I am My wife is mad at me, I want to be honest with you because you're going so hard. Well, because I'm gone because I'm on the road.. I haven't been home in like two or three weeks. And she's on board with me on this vision and goal and she sees what I'm trying to do, but she does want me to come home. Yeah, I don't blame her. That makes sense. You have to p pace it out so you can make it, but that's a great start. So if you if you were to maintain that pace or even close to it You will be through The IS and the other smaller debts very, very quickly agreed Absolutely. So this is only a question this is only a question of of is it going to be twoo months or is it going be one month? O is it going to be three months or is it going to be one month? That's the only real question, right? We did ten thousand He did ten thousand. ten and eight and five and five two So it'd be four four to five months. Yeah. Yeah. O you can do it now Either one. So the only question is just, you know you know, that, so the trade off between the momentum that you're feeling, which is very positive, and I don't blame you for wanting to maintain that is that the stupid IRS has unlimited power. They can just decide to screw up your life. They don't have to go to court They can just start garnishing things, they can start keeping tax returns, and they will. They can take your money out of your bank account. They don't have to go to court. Everybody else has to sue you, win the lawsuit and then go to court So they've got unlimited power, which is scary as crud, because they're also not real smart most of the time Dumb and powerful is not a good mix And that's what you're dealing with most of the time, not always, but most of the time And I mean, I get audited by these people like it's a hobby It it may be too much work to do E Je, but also we always say if there is a larger amount owed, you could go down to your credit union and get a personal loan for twenty one thousand, pay off get rid of them.ay pay off the IRS and put the twenty one thousandll back in your debt snowballs that you pay off Yeah your daughter's car credit card. our wife's car, right? And then you deal with that personal loan of twenty one thousand dollars to the credit union versus the IRS. You could do that. The second reason we move them to the front of the line Um that they are, um The third reason you're not going to bankrupt anyway. The third reason we move them to the front of the line is that the interest rate and the penaltty is very, very, very high So all of those reasons cause us to interrupt the debt snowball. The only time, by the way that we interrupt the debt snowball move it to the front. But I don't care. It's not the end of the world. That's the reasons we move it If you want to if you understand those things and you want to leave it there or you want to go get that credit union loan and then you knock it out in four months instead of this month That's okay with me But you just you're taking some extra risk when you do that And u, you know, when I'm coaching people that are struggling and they got six, you know, they got chase master cards suing them. They got a city bank suing them and they got Lexas Motor credit suing them on a repo and they got the IRS I'll take all of those other three versus ARS every time and what they can do to you The other ones and what they will do to you. So I But I don't think any of them are suing you. I don't think that's where you are. You're under control. You're knocking this out. You got momentum. So I'm not scared for you now, but this comes from years of coaching people that were really, really were struggling in behind the eight ball. And I just always want to get the IRS out as fast as I can. But listen, Dude, you need to set a date. If they're not gone by seeptember one You got to move them back up You gott to move in fr So set yourself a deadline. I'm going to knock them out by this date or I'm going to move them to the front of the line one of the two and then knock them out and then go back to your death snowball. Yeah, and I appreciate your enthusiasm. I mean, that's incredible. ten thousand, thirty thousand in three months. Yeah, that's boom. Unbelievable. Maybe your wife and you for three more months, I'm going to do this pace and then you're gonna dial it back a little bit because you guys got you got some You know, we ought to have his wife we ought to have his wife talk to the gym owner's wife. I her be like my husband's working. I wish my husband was gone working and making money. You would want someone like Ge. I wish he would leave and go make some money. My go. Ge well done Okay guys, let me ask you something. What would it take for you to switch your bank? Because if you're still earning next to nothing on your savings, you need to check out Fairwin's credit union. And I know what you're thinking, it might sound like a hassle. Moving your direct deposit, updating bills, getting a new debit card feels like a lot. But here's what most people don't realize, staying where you are could be costing you hundreds of dollars every year Sall, the average savings account pays less than half a percent. So let's say, for example, you got twenty thousand dollars saved. You might earn around seventy dollars a year, but with a fair wind high yield savings account earning three percent APY or more, that same money could earn you over six hundred dollars. And that's real money that you can use towards the baby steps Don't let temporary comfort keep you stuck Check out the smart bundle from Fairwinds Credit Union. You get a high yield savings account, a no fee checking account, and the Ramseay B weird deebit card. Go to fairwinds. org slash Ramseay to learn more and make the switch today. That's fairwinds. org slash Ramsey, inssured by the NCUA Stacy's in Indianapolis. Hi, Stacy, how are you? Hi Baby, how are you? Great. What's up Soabe My daughter is twenty nine. She's married She's a nurse, just works part time because I have a two and a half year old granddaughter. Her husband makes fifty seven dollars an hour I'm disabled, divorced, and I used to work in insurance. so I know you don't like this, but I bought whole life insurance I want to cash in her whole life policy that I've had for twenty nine years And just so you know, they each have their own life insurance policies outside of their work She feels entitled to have that cash value. She thinks it is hers. I disagree. I think the money's mine I could use the money. What do you think Well, you're the owner of the policy and you paid every dollar for the policy, correct Yes, I've been paying twenty six dollars a month for twenty nine years. And how much is the cash value when you cash it out? eight hundred dollars But God, you totally got screwed. Oh my god. Yeah And like I said, I worked with my career insurance before I had to go on disability years ago. Okay, so how many kids do you have that have these policies All right, so we're cashing them both in, right Roth. A the moment, ching the other went in because Long story short, my other daughter I'm just not sure her wife's taking her so I'm just K kind of holding on right now. I don't care. How old is your other daughter is four years older. so should I just go ahead and cash out my name? Yeah you better cash them both in. They both suck beyond belief. You've gotten screwed. Don't keep them And your it's not your obligation to take care of the one that has her act together or the one that doesn't have her act together. These are thirty one year old grown women And you paid for this policy. It is not their money Okay In neither case are you to take care of them. Well, than you. I just wanted to kind of have somebody else tell me that because that that's not only that's not only moral. That's also what the law says. They're not the owner of the asset. you are Okay. You own it That's why they call you the owner. Yeah I should What age did you open up the policy for your daughter? One year old. She was one. nine., And you did twenty six dollars a month. A month. Okay. I was just gonna say. So you should have if you just had that in an SMP just for in people for listening, it should be fifty eight thousand dollars is what you want If you put it in a real investment instead of a rip off whole life policy, instead of six thousand eight hundred dollars, you'd have sixty thousand dollars. And it says she would have put in eight thousand seven hundred thirty six dollars. So she put in more than what the investment. That's made of you. Yeah. had a negative rate of return This is why you don't buy a whole life life insurance and why you don't buy it on your kids for sure. So bad. So yeah, so bad. whole life sucks H Have we been unclear about that on this show? don That is a good question though that her daughter assumed it's hers because her name was attached to the accounts. You know, probably I put Stacy's gone, but probably what has happened? is that Stacy has told these kids their whole lives that she's invested this money for them. For sure And, oh, that's my p. you made an investment for me. Thank you And you got this money because I've set this money aside in my name. Yeah, It's in my name, but it's for you And that's probably what she said all along. Yeah. And so now they're going, Yeahah, but you told me, mom, it was mine. I know. yeah. that would make sense. That's probably could have been probably not title B. She probably just messaged it wrong. But you know, about Technically speaking, you own the money And by the way, you laid the whole thing out on how she makes money, herer husband makes fifty seven dollars and you're disabled and all that. None of that matters to the discussion. It's either her money or your money regardless of who is deserving or who's hurting or who is more healthy financially likeike the other daughter, I don't I'm not sure she's going to turn out yet. Well she's thirty four. I think we're pretty sure You know And so Second She's going have to have an encord or get this straightened out. She thirty four is young. I know, but you can have an encord, thirty four. and you need one apparently if your mom still don't know if you're going to make it. Yeah. So the victim language in it Exactly. doesn't matter. paints a look maybe the attitude that the daughter' ha to. I don't know, but yeah, just some thoughts Stacy, but yeah the Was your money you put it in under your nameam make all your money. But you know, You know, I might I might take back my answer if you promised her this money her whole life then probably you ought to just keep your promise and give it to morally, legally at your money Except that if you said, this is your money, this is your money, this is your money that, you know, if I had a mutual fund, I opened up for you and I said, this is your college fund We're going to use it for college and it's your money. It's your money. we're saving for your college, which I did, by the way, is a uniform Trfer to Minorsct I was in your name. And then you went to college. I ended up we ended up paying for college out of our pocket And then when y'all graduated, we gave you your ema to start your life off as an adult. And so But that wasn' in my name. It was my journey. Yep and But I had I had allocated that emotionally and relationally We didn't know it, though. I knew you had a college fund. I thought you were paying for college. So there was a little bit of a But I was using it for college. Yes. yeah. yeah, that's true. Yeah But so So how it's communicated is important to exed. D you make a promise? Yes. So you promise your kid this was their money In fact she did you gott to keep that promise. Yeah. that's the expectation. So she would be disappointed. So I would take my answer back if that's the case, St. But it's not yours. Yeah U and, you know, who who is Making money who's not is not relevant to the discussion Jocelyn's in Houston. Hi Jocen. How you I'm good, how are y'all? Better than we deserve. What's up So basically, I have two four hundred one Ks that like has two thousand six hundred dollars in them. I have about seven thousand dollars in credit card debt that I kind of just racked up and being financially irresponsible. But I want to know if I should take those out to just kind of But towards that debt, I'm on baby step one and like just trying to get my life together. I'm twenty six. I live rent free right now. What do you make? Yeah U aboutbout three thousand dollars a month pick up my hours and attack the credit card debt and leave this alone. and I'd roll it to a four hundred one K. It doesn't matter. It doesn't matter. I mean I'd roll it to an IRA, I'm sorry. It doesn't matter much mathematically because it's such a small amount percentage wise it's suicidal. Here's why Okay. You cash out the four hundred one Ks, you get a ten percent penalty plus your tax rate. Let's call you in the twenty percent tax bracket for the fun of it donon't think you are, but you might be. That means at ten percent plus a twenty percent taxes, that's thirty percent. That's like borrowing money at thirty percent interest to pay off your credit card So they're going to take almost half the money if you take it out instead of rolling it to an IRA. So I think as a matter of starting to make good wise financial decisions more than just the math. I would go ahead and roll it to an IRA and force myself to pay off the credit cards with hard work. Yeah. Keep it in there and don't touch it and let it grow and at retirement Maybe one hundred, two hundred K in there. I don't know what it'll grow to, but Um, That'll always be a little bit of a safety net too for retirement, which is great. Yeah, and you just add to it as you go along. I've had some IRAs that were So small at different times and I move them around, put them all together later, put them in a pile, and it has ended up turning into some serious money over time, but u The big thing here is I just want your brain to get used to not looking for shortcuts at high cost And this is a shortcut at a high cost, even though it's twenty six hundred, so you're probably gonna lose a thousand bucks of that in taxes and penalties. And so you're still going to get out with sixteen hundred and one thousand dollars does not change your life one way or the other. It's not the dumbest thing you've ever done by any stretch or will ever do Um, so it's really not that much money But if you add a zero to it, it starts to be ten thousand dollars two zeroes to it to be hundred thousand dollars Yeah, and what changes your life in this, Jocelyn is your income going up M making three thousand a month. I would look to see where can I get an extra thousand two thousand What does that look like from from an income perspective? because that's going to get you through the seven thousand dollars in debt so much faster and then your emergency fund and beyond so it's kind of your That's your ticket out, not the old four hundred one K. Hey, I want to talk to you for a second about love and not love like in Titanic or something. I mean responsible love. the kind of love that moves you to take care of the people closest to you And one of the most important ways to show that kind of love is by having term life insurance If you have anyone depending on you, a spouse, kids, anyone You need term life insurance Term life insurance gives your family real protection if the unthinkable happens so they can spend their time grieving and not worrying about how the bills are going to get paid. Xander is a broker who works for you, shopping the top companies to find the right coverage options for your needs and your budget In many cases, there are options available with no medical exam and instant approval My wife and I had term life insurance through Xander for years long before I worked at Ramsay because we trust them Getting term life insurance is a way of saying I love you when you could no longer say it yourself Go to Zander d.ot com recall one eight hundred three five six four two eight two to find the coverage that fits your family Welcome back to the Ramsy Sh in the Fair Winds credit Union studio. Rachel Cruz, Ramsay personality, my daughter is my friend Co host today. Louise is in Tampa, Florida. Hi, Louise. How are you I'm doing good. How are you guys? Better than we deserve. What's up So I had a question about games Me and my fiance. have a credit card and I am always making sure that if we use it, we paid off before a statement date he was telling me that why don't we let U Why don't we carry a balance to build credit And I I don't know That's how that works I kind of wanted to ask you guys Does that make sense How old are you guys twenty seven both of us. And when are you getting married we well we're saving money so I can't say a date just because where that's one of our stuff 'm sorry You have to have money to get married? Right Well, I mean, yeah, we can just go get it done and that's it like the wedding I would like You know? Yeah. Okay. We've been saving for a while now. Yeah. How much y'all have saved for the wedding So so far we have twenty And then we also have another twenty, that's our six months of living So what kind of wedding are you going to have Well I don't know everybody. Weddings are expensive a lot But I want to make sure that if I want something, I can have it. don' There's not that much money in the world. Yeah, I know. That much money doesn't exist. I want I want it. I can have it That's not a's that's a four year old. No, you don't get to do that. Youve set a budget on your wedding. you're a grown woman and you get married and you do it for twenty thousand and you start planning it this weekend. Okay, back to your question Um, So your fiance is correct that if you were to run a balance on your credit card and pay it on time, it will cause your credit score to increase becausecause your credit score based on's called it's by an organization called Fair Isaac and it's called your FICO score And it's based on how you interact with debt how much debt you have, the type of debt you have, and whether you pay your debt on time or not. New types of debt. New types of debt. that gives you if you have too much debt or too little debt, that gives you your credit score. So your credit score Technically speaking, if you analyze it's how the algorithm works is your I love debt score And the higher your credit score, the more you love debt So if your if your goal as a married couple is to get in debt and stay in debt Deply the rest of your life, the credit score will serve you well But if your goal is to build wealth then you would avoid this at all costs because you don't want to play kissy face with the bank to build a score This shows how much you've been playing kissy face with the bank Instead, I want money I want to build a net worth. I want to become wealthy And the credit score is not an indicator of your financial health or wealth It's simply mathematically speaking an indicator of how much you've been playing kissy face with the bank That's how it's determined And so what he's saying is, hey, let's owe the bank more money. and pay it off a little at a time. so that we can make other banks happy Wrong Bad plan You follow my logic? No, yes, of course. That was what I was telling him It's like if you just want to be more in debt then what's the point of doing all your steps, let's say? Exactly. You wouldn't do any of our steps if you're going. If you want to stay in debt, you need to go do a different plan. Our plan won't work. And Louise this is this is an important subject for you guys to get aligned on When it comes to your marriage, money fights and money problems are one of the always in the top three reasons for divorce And so This is it's a this is a big tension point. It may not feel huge. I mean, it's it's big enough for you to call to be like, Hey, this doesn't feel right. But if your value system is different with money Not that you guys have to be the same person, but that you're moving in the same direction financially because you're a team And you're like, this is how we're running our household If or when we have kids, like I mean, it It continues on and when you start in such a different place It's a it's a red flag for me. I would I would want to be in the same place and you may decide, Louise getting off this call. You could totally decide like, I'm okay with debt, right? Like we're not trying to push you, right? But you need to be on the same page. clelearly a life of peace and building wealth is avoiding debt. and that is what we do believe. And then your credit score means my credit score has been zero for thirty five years. Rachel has undetermined. Yes. Never had a credit score. Inner life But then you have to pay cash for cars. You know what I mean? Like like you're saving up for vacations. L you are choosing a life without debt. But you also are choosing a life of living below your means of delayed gratification, but of a lot of peace and control and autonomy over your money. Which gives you a large pile of money, by the way. L because you're not giving it all to some stupid bank. Y. So there we go. That's where wealth comes from. Yeah. The other thing I'm gonna throw in and you didn't ask about this But for God' sake, cut up that credit card and close the account tonight. if you're not gonna to get married. The two of you don't need to be on a credit card together. Yeah, keep suuper dangerous for you. suuper dangerous for him The credit card ballot runs runs way up and one of you runs off. the other one stuck holding the stupid thing. and now you're going to get sued And or you end up paying a balance for for the one that left Yeah. And I know no one ever leaves. Bull crap. you're not married Okay, They leave all the time Get off that car. Do not be doing stuff financially and legally with somebody you're not married to. Danger, danger, danger, danger, danger, my daughter. Don't do that Please And especially since there's not A dream And a date set, right? It's kind of this endless feeling of the abysqu of like, we're going to figure it out. And and then when you live in that,'s which people do for years and years. You know, we talk to people, they have engagements for four years. They live in that, they start playing house, you start commingling finances, you get down the road. It just it starts It starts to be a problem. so I would keep everything separate At which point Intill you guys get married? And if he is the one like You guys set a date. Painb get off the ladder. If he is the one And that could be in December. it's not like you have to do it tomorrow, but put a date on the calendar that you guys work towards just for some Certainty in the relationship, but if if you have the money to get married, set the date now, get married You're not this's not good for y'all. It's not good. We don't care. We make no money when you get married It doesn't help us at all. We're not in the wedding business. Too bad. I wish I need to get in the wedding business. I need to do something to make As often as I tell people to get married these days I need to It's your I' say a priest. You w to be a priest. It's a What is it What is it when you You want me to officiate the wedding? Ordain. I'm gonna start I'm gonna start doing weddings, days weddings. Yes. That way I can make some money off all this adice. Aies can get hurt. Then I can have a conflict of interest. Then she can get the fiance and they can call in the next hour And we'll get theet you know what I mean? You can keep it rolling. Well, we'll fly up here and extend the de at free stage with your little bouet, where there we go. go, come person. You're getting ready to hit the road this summer. You want to feel confident. your car is ready to go. When you don't fully understand what's going on under the hood, it's easier to either ignore something important or spend money you didn't need to. Be let's be honest You're not a mechanic And you shouldn't have to be. That's why we trust Christian Brothers Automotive, the official auto repair partner of their Ramseay show. They bring clarity to car repairs and maintenance. With their digital vehicle inspections, you can actually see what your technician sees, understand what needs attention now and what can wait So you can make wise decisions without second guessing. Listen, when you're counting on your car to get you where you need to be, you don't want uncertainty. You want confidence. and Christian Brothers stands behind their work with a nice difference warranty, three years or thirty six thousand miles, whichever benefits you more. Go to cbac dot com slash Ramsey to schedule your service and get ten percent off your visit. That's cbac dot com slash Ramsey ten percent off up to two hundred fiftyllars value, store for detail. Jeff is in Birmingham. Hey, Jeff, what's up? Hey, Dave, how are you? Thank you for taking my call. Sure, how can we help U I'm saying u Its not about a crisis I' never intended Due to some illness and due to some other things, I went into a government sponsored forbearance program with the largest servicer in the country. And that was in twenty twenty three. Since then, I've gone back and forth several times trying to get back on to where I just pay my payment and you know, I've been told numerous different things and, you know, I was told, hey you can do backke end payment. And so I pid, you know, trial payments. And then they send me the paperwork, the papwork's not right I send it back. And the longer the short is is I've gotten down now to where the last trial payment I paid I pid on the last day of November screenshotted the email they sent you know, confirming the payment And then they came back and said that I failed the trial payment plan because of theetainment being late I filed a respa and a notice of err Contacted FHA. I've been through a lot of different steps to get them to acknowledge that the payment actually was made on time because I wanted to get off of this, you know, cycle that's been going on almost three years now. And so I have a document in front of me that says, if I don't pay them forty three thousand dollars, they're going to foreclose in my house, which I have over fifty percent equity in And I was looking for some kind of suuggestion. I've done everything I can do up until this point So forty three thousand dollars is the amount you're inrears right now Crect Net of everything. And that number is probably correct, but what you're saying is is that you had a a forbearance plan, which is a plan to pay payments greater than the normal payment to catch up And apparently that's gone sideways several times to get forty three thousand dollars behind. What's your normal monthly payment supposed to be twve hundred dollars So you're at least forty thirty eight months off. in only three years How's that possible? Well, it takes them instead of the thirty days that they No, no, I mean, just think about it fromom twenty three to twenty six is only thirty six months That's as if you haven't paid a payment the whole time So that's the other thing. They're holding, I think six or eight payments in scrow somewhere that they don't even account for through my trial payments But then, you know, there's there's three, you know, they did three appraisals. I mean, they just rack up fees like it's, you know, going out of style Yeah, and they're charing you are they charging a huge late fees as well Yeah. And have they tacked on have they tacked on legal costs in in that forty three as well It doesn't list it as a line item, but I can't even get them to give me a line item. I can't get to forty three thousand. That's what my problem is you and me both. and when I start doing the math and every time I ask them about it You know, I don't know. The loan that they sent me after they told me they would just put the back payments in the rears of my cur of the mortgage I had. which I was never laid on U thenen they sent me a loan for forty years that was going to raise my payment fifteen dollars. Yeah So that would be that would probably be correct, actually Yeah Well it would be. And so I called him and I said, this is not what we ever discussed. And the person I talked to you had no idea, Are you A you talking to FHA or to the loan servicer I've talked to both. No, I mean, who when you made that phone call, who was it two So when I talked to FHA, they said, well, you can, you know, if you filed an appeal and a notice of error with you know, with the mortgage servicer, let them answer and then they can work that through. but basically the loan servicer is the one that decides whether they the payment was late I just, you know, and I explained to the FHA person, I said, I don't understand how you can send me an email that I have a screenshot and it's in my inbox. in the correct month that it was due and tell me that my payment is late. Yeah. Okay. All right, so the net net net is is that you probably have in reality Six payments or seven payments or some amount laying in escrow So seven eight thousand dollars And you have forty three thousand dollars owed in arrears So somewhere around thirty six thousand dollars would get you caught up. Obviously you don't have that And and obviously we're dealing with bureaucrats at the FHA and incompetence the u at the servicer. Who's the servicer fraid of mortgage. Yeah. okay. All right Yeah, incompetence at the service with then that would be normal because they're massive. And and they massively don't give a p. What a name to. freedom. Yeah. That's what they're giving opppposite freedom. I also have a two point seven percent interest rate. so every time they try to do anything, they're like, well, you knowre thing they'll go off a lot. So what what is your income So I think that's the other thing. and the reason I went on forbearance originally was from long COVID. And then I had I almost I had to go into the hospital and I almost died And it took me a little while to heal Well They told me well, you can't pay payments while you're run on forbearance because it'll kick it into, you know, it'll kick it automatically into foreclosure. So Every time I've tried to get back into kicking you know into paying for my mortgage It's a seven months, eight month process. Yeah to give me some kind of answer. and if it's not perfect, it goes right back into the loop. Yeah. What are you m? What do you make Well, so currently I don't have a job, but I have I mean, I do contract work, I do other things, but prior to getting sick, my income was two hundred thirty What will you be making in the coming? Months Eough to pay a twelve hundred dollars payment ten to fifteen thousand a month I'm good And then I have you know, I have money that I mean, I have I have assets. I've just had them tied up from, you know, a divorce that was five years ago. So what assets do you have? What assets do you have So I mean, I have an account it has four hundred thousand dollars in it But I can't touch it until my ex signs the paperwork, which It's the last thing and she just kind of keeps dragging her feet on. Wait a minute, what is the four hundred thousand It is a it's it's it was a investment account we had, you know, when we were married Okay But it's f. So let me h let me let me put it to you this way I can't make freedom mortgage be competent or the FHA not be bureaucratic idiots And you can't either And so the best thing you can do is write them a forty three thousand dollars check You owe them anyway. an option that. You oe Yeahah, you do. Yeah you do. You make ten thousand dollars a month I don't currently make ten thousandax. You said you're going to in the coming months. I asked you. Yes. correct. Yes, No I will. Okay. Then go make forty three thousand dollars. They're not going to foreclose in twenty minutes It'll take them six months to a year to get around to it. Have you notice that they that they're slow Yeah. the one thing that concerned me is they sent me a letter saying that if you don't make it by x date, then we're going to what's the And that's what Tmorr Okay, thenen they're going to start foreclosure Okay Yeah. And in Alabama that takes at least a month, but I don't think but it probably takes six months because they're probably going to sit on their thumbs because it's what they do. They're thumb sits Really? I mean, you probably have time to cashflow this. In the meantime, call your going to the judge and saying, I'm going smack my ex into next week. Wh. I'm going to have the judge smack her into next week and get her to sign the Dad gum paper Holding up for four hundred grand. I'm getting ready to lose the house because of it So Th those are variables you can control. You're asking for some way to make your stupid butt mortgage company and your inept FHA behave. They can't The things you can control, you need to go control and get forty three thousand dollars out of that four hundred thousand dollars account or go get forty three thousand dollars out of some work you do in the next ninety days before the actual foreclosure date occurs and pay this thing current. That's what I would do if I were in your shoes. If you don't do one of those two things, you need to put your house on the market right now and sell it for you los it But you need to go get some moneyoney and get stupid freedom out of your life That's what this comes down to, because you have tried for three freaking years to negotiate with morons And it doesn't work Hey guys, healthcare is one of the biggest stress points in your budget. It's confusing and most of the time, it feels completely out of your control But there is a better way to handle it Christian healthcare mininistries isn't health insurance. It's a health cost sharing ministry where Christians share each other's medical bills And it's not a new idea. TH ChM has been around since nineteen eighty one. It's predictable and proven, and they've shared over thirteen billion dollars in medical bills for their members Plus, you get more flexibility. There are no network restrictions and you don't have to wait for open enrollments Let's talk about how CHM helps your budget because programs start at just one hundred and fifteen dollars a month And many families save hundreds of dollars a month compared to traditional options. 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Otherwise you're too worried about your own dad gum comfort to go win If you're sick and tired of being sick and tired and having nothing to show for it, we've got a way out. The every dollar budgeting app will not only help you get on a budget, but it's build you a personalized Ramsy plan It helps you find extra money every month. You have a coach in your corner. It's like having Rachel me in your ear and Jade and George and even Daloney. In just fifteen minutes, you'll find thousands in hidden margin. And you're going to feel like you got to raise Don't be normal. getet sick and tired of being sick and tired. Live like no one else. St start every dollar for free in the App store or Google Play. Evan is with us in Tulsa, Hi, Evan. What's up Hi, how are you guys? Better than we deserve. How can we help My husband's extended family likes to meet for their birthdays for dinner and cards are exchanged with money at each gathering. and we're a bunch of grown adults and I feel like it's just a little unnecessary. And I just want to know how I can be the bad guy to get kind of put a stop to it. Oh, I wouldn't do that Oh I wouldn't do that at all. Well, how much I would have him do it, but I wouldn't do it Well, he always makes me a bad guy though, you know? that's the problem be the wicked witch of the West. It's his family. He's got to deal with them, not you. You know, I might already be that with the family. No I just. So why do we want listen at this point why do you get invited to the party That's a great question. I wish they'd been un. How you give money, That's why. Yeah You bought your way in How much is it? I'm just curious Um usually and okay, I would also say my husband's a very generous man. likeike he's not one he'll like, it's fine, it's fine, whatever And so usually we put like sixty eighty bucks in each card. Good card Thank you. That's weir my gosh. He up Okay, how many o, I just I'm trying to picture. how many people are at the table Like how many brothers and sisters, spouses, parents? He's an the only child. and I think so they view their family like cousins, aunts as like Oh, it's not even like family siblings. No. Oh, no, no, no, no. how many people are at this dinner? Uncle, grandpa, so usually it's One, two, three, four, five, six Seven. Not including us. Okay, notot counting grandkids. There's eight of us. Rachel Winston, Daniel. No there's no grandkids. So there's no, notot counting grandkids. So there's eight of us. I can see all eight of us sitting in a table And the chances of us giving each other money is precisely zero It's dreason of getting a birthday partor if you're lucky to get a text. You're lucky to get a text. Yeah Yeah. But so it's been a tradition forever and never, but these are all thirty, forty year old, fifty year old people. fifty Yeah and sixty and seventy Yes. And it's the birthday tomorrow. That's' calling right now. Too late. you're in on that one. You can't fix that one. Well, on that one. Yeahah, but like how do I bring up like you don't? I don't mind getting together. You don't. your husband has to.. And if he won't, it's not gonna to happen But he just doesn't want to upset his mommy No it's not even his mom. I think his mom would be completely fine with us doing it. but just people who go with the flow, they don't want to cause any risk. Yeah. Exactly. So I wouldn't cause a risk. I wouldn't cause a stink. I would not make it about them. I would not make it. His job though is to fix his family, not yours. Really? That's bad Mojo. You do not want to get in that relationally. But he should sit down and say, hey guys We're working on some financial goals and we'll be happy to pay our part of the dinner and come to dinner with everybody and celebrate. And we'll send you a nice text and buy you a nice card, butre we're not going to give grown adults any cash anymore because we're working on some other stuff. We love y'all though Hope it works out for you And he just needs to raise his hand and say that. I did do that inappropriately. Actually, I had my wife's participation and she may have actually done it. She should have done it. Her family. they all there's ninety million of them and they all gave each other Christmas gifts And she's got like five brothers and sisters, or's thirteen grandkids There's people everywhere all over this house. And we go down there and you buy all these adults that you see twice a year and I love them. They're good people. Yeah you buy them all the time or some socks and it's just or whatever. try to guess what University of Tennessee paraphernalia they need this year or whatever it is, right? And we finally, when we went broke I told Sharon, I said the little kids under twelve get a gift, everybody else gets a nod. or we'll draw names. And And so she said, Oh, that's a good idea. We'll draw names. And I said, Okay. And I don't remember whether she brought it up at Thanksgiving or I did, but she raised her hand and she said, Hey guys, we're broke. We're drawing names this year because we can't do everybody's gifts. and we'll buy the kids under twelve, the baby little little baby gifts or whatever. because it's Christmas And we drew names. So it's a similar discussion And by the way, that went real well. Everybody else went, Ohh yeah, we kind of thought the same thing, but we wouldn't want to be the first one to bring it up. Yeah. and if anything, Evan, and I know you're not major fans of the family, but if he wanted to give some like thoughtoughtful gifts or something, you know what I mean? Like you can do something for twenty bucks of like, hey I saw this, you know Uncle, you know, Uncle Rick and I thought of you, and that's his birthday gift versus giving a check of seventy five dollars. For twenty three hundred twentyies or something, four twentyies something. Yeah okay. Yeah. but I I say this Evan. you're correct. This is absurd. But if if it ends it almost wouldn't be a hill though that I would just push and push and push and push because it happens six times a year and It may be a thing you just, if you don't want to address it You gott to just live with it and it's a roll of the eyes kind of thing, but he should, but because it is kind of I don't disagree. it's weird. it's just A bunch of sixty year olds giving each other eighty bucks That's just weird. Okay, But yeah, But if you want to do it, it's okay. I just not I think it's weird, but Yeah, And I just raiseed my hand and go, we have some other goals. We're not doing it, but your husband has to do it Otherwise, you're just gonna come off a stinky stinky heaven You't want to be stinky heven. Yeah, No. You always let when you have a conflict with the other side, you let the other side handle the other side. That's, you know, because otherwise you end up being a stinky one and it's just it's not a plan planlan Linda is in Knoxville. Hi, Linda. how are you Goodood. Thank you for taking my call, Dave and Rachel.. My question is about five twenty nine accounts that has been growing since my daughter, who's about six years out of getting her masters did not have to use much of it and it has been growing and growing. She's single with no children. Why did we not use much of it? She got a wonderful scholarship. We can pull that much out without any conion. The value of that scholarship can be withdrawn with no taxes rep payment. Is too late? six years ago. You might have to go back You might have to file an amended return And well, you wouldn't have to file unless you got audited, but you know, you might have to go back and do that. But talkalk to your tax advisor about how to do it, but you can pull the amount, the value, market value of the scholarship out at any time with no taxes or penalties This was worth the call. Wow. Okay. Well, since you didn't pay nothing for it, it definitely was worth it.. Well no I have high values. And your high school curriculum has a lot to do with why all three of my children are very financially stable for. Wow, honored as well. So was what was her scholarship worth, do you think What was a tuition worse? Oh senor semester, so one hundred thousand How much is in the five twenty nine U three hundred and thirty. Awesome. We can get a bunch of it out. And then would you take the rest out and pay taxes on it? Yeah pay a ten percent penalty plus taxes on the growth on everything else O you can move it to a sibling or a child. Yeah She's She is the one who's earning the least out of her siblings and so they're fine and she is really wanting to look at getting the house. And that's kind of what makes my heart hurt is there's money sitting down Yeah for ob. You're gonna to get, you know, you're going to get one hundred thousand out for the house. Ey. If you pull the other two hundred out, you're going to get a ten percent penalty on the growth only. I don't know how much y'all put in and on and taxes well If you're planning a summer trip, you're probably spending a lot of time getting everything ready because responsible people prepare for things that matter. And travel as a way of reminding us life can change fast That's why I recommend mama bear legal forms. 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I moved out into an apartment He moved into he's in the house now and we can't get rid of it because he will not get out of the house He's been there for like two and a half, almost three years I don't know how he tells me he can't pay the rent and ex taxes and everything and then move to somewhere else and pay that too. So I'm kind of confused and how do I get him out of the house to clean up the house Okay, so it's it's not selling because it's junky Well, that outside the yard is pretty messy and stuff But I just and they do show it. One lady did offer her two hundred fifty, but she's a flipper She wanted to buy it cheap and flip it, you know, and wasn't work? Wn't give us Probably about three hundred sixty. Okay All right Fty three years, Anne Yeah. I should have left a lot sooner, but I didn't. It's one of those things What is your income? I have every month is twenty two ninety seven How you? Seventy one. Okay Cool. How much do you guys owe on the house About one hundred fifty two thousand. What does he make Well, he's retired from the from I won't tell you where, but he's retired and he I get forty percent of his pension. He gets sixty percent Your twenty two hundred is forty percent No, my It's like sixteen fifty four as might forty percent. Where's the restust coming from So security So I barely get buy. I have about one hundred and twenty left for gas and food You know. Yeah. And I've got six thousand eight hundred in credit cards, which I So he doesn't really have he's correct in that he doesn't have the money to pay rent and the house payment, right? Right, right. And neither do you Right We're kind of stuck. I don't know what to do H. And the plan and the divorce that he was going to sell the house and you guys were going to split the equity Yeah, or else he was going to buy me out, but he can't refinance. Yeah. He says he can't I don't know, but he I don't think he can. I don't think he has the income. If that's his only income. Yeah, it is. No And u Well, I mean, so if you got your wish and he moved out then your house going to foreclosed on, isn't it No, that I'd lower the price enough before somebody would buy it. but like I like it cleaned out so I could, you know paint a few things and make it look a little nicer. It doesn't look real good right now Yeah So it's on the it's on the market at three hundred sixty. ight now it's three hundred fifty. threeree hundred fifty. Okay. Yeah, he started at four hundred and forty, which is crazy. Well I mean, Um Yeah The problem is you light a fuse that's six months to a year long before the house gets foreclosed on when he moves out Mhm And so you go over there paint it, you clean up the yard. and if it doesn't sell, every single month, you're going to be dropping the price because you're going to have to get rid of it You're going you may wish you took the two hundred fifty Yeah, I'm kind of thinking that I should have. Well, I'm just saying if you like this fuse You're creating a pro T tick. Yeah tick When he moves out. Now the clock starts ticking. the sand start going through the hourglass, the pressure' on You follow me And I just I want to be careful what you sign up for that you know what you're signing, what trip you're taking here Um What would I do Obviously he is not going to help by cleaning up the artery. I would have already For his own sake, he should have done that because he would get more money in his pocket he's disabled too. because he had six back surgeries and I don't know what he can lift or sure he's not he's not doing anything. Okay. And for good reason now, we're not going to accuse him of And you can't afford to hire people to do it. We don't have the money to. No, you don't. No So you have children? and growown childildren. Yeah, where are they O'es here in my town, but they both have back problems. Oes in Roseberurg ones in here Falem All right, And so obviously they're not able to help and they were probably affected by the divorce in terms of their motivation to help One is ye Yeah, definitely What's he paying in mortgage payments every month U Ab what I'm paying. I'm paying eleven twenty two and he's paying probably about teen twelve or thirteen over thirteen. I'm just wondering rent wise if there's anything cheaper. I don't know if him moving out and you going over there seventy one with a paint brrush and a trash can is going to make this deal work enough that I'm thrilled with the bomb that we set a fuse lit on. know that much. Yeah, I mean, I don't know. I don't know the house. I don't know the deal. So who's do you know the realtor? Do you trust the real estate agent I do. Well, we bought the house from the same guy. Okay And what does the real estate agents say you should do He says this Ie keep waiting for the right people to come by, which I don't agree with because We can't keep waiting I was going to pay all my credit cards off when this house sold Now I' so that credit card bills how much creditard debt do you have? six thousand eight hundred Yeah, that's not bothering me much We'll get there. That's not a panic. You're eating, everything's okay I don't it's not ideal, but none of this is ideal. Yeah And no retirement accounts or anything. It's just the pension. I just wondering if there's any other. There's no money, any money Well, not that I know of. I don't he's He's not the truthfulest person in the world, but I don't know what he's got, really But I doubt if he has much more. So sad and I'm sorry. Uh So what I would do would be to try to Work with your ex to allow some access and begin to get some things cleaned up. that you would do if he moved out while leaving him there and dropping the price And if that doesn't work, then You're going to have to ask a judge to have him move if he doesn't voluntarily want to move. because he's going to stop because I did call him one day. I was going to talk to him about the house He hung up on me. He wouldn't even talk to me Okay, well, then you're left with a judge, I guess Yeah So I'min either we sell the price either we drop the price or and or you move out And if he won't do that voluntarily, the judge will have to tell him to do that because he's inv I assume there's a divorce decree saying the house has to be sold And the house is not actively being marketed. It's not in marketable condition. And so you can force that, But and be aware, you may be playing some cards here The lights a fuse on this bomb that you lose the house I mean, it's possible If the real estate market slowed down for some reason, there's a jump in interest rates and nobody wants to buy anything, even the flippers are out of the market. and that price drops on down Um Yeah, you may be wishing you'd taken the two hundred fifty. I'm kind of wishing you'd taken the two hundred fifty right now But I don't think he wanted to take it either. Yeah Well, if it's at three hundred fifty, some I mean, and there's probably other flippers in the area for I mean hopefully you can get it. But but the thing is is if you don't get somebody to make a transition transaction quickly, that real estate that can go months and that's the That's the part that scares me where I'm like, I don't feel like you have financial margin go that long. Don's going have to use this move with Um any of the forty three years worth of emotions If there's any Didn't detect it? But if there's any anger or I'm revenge, I'm hitting back, or I'm trying to make this guy finally behave one time. Yeah No.omet something like that. You need to make this move because it's the right. too much one hundred thousand. one hundred thousand dollars of equity to pay off credit card debt and live. Exactly. Lve a little more comfortably Welcome to the Ramsay showow in the Fair Winds Credit Union studio. I'm Dave Ramsey, your host, Rachel Cruz, Ramsy personality. My daughter is my co host today. Brock is in Manhattan, Kansas. Hey, Brock, what's up? Hey guys, how you guys doing? Better than we deserve, how can we help? U so I got married a few months ago and a few weeks ago we found out my wife is also pregnant. Yay Yeah, I know, we're very, very excited. And we have a little bit of a debt problem. So she had a car payment that she paid off all on her own and then after we got married, I helped pay off the credit card, which wasn't too much. It was about There's about two thousand But she also has about one hundred seventy seven thousand dollars in student loan debt And I was wondering how we should attack that. Is she a doctor or a lawyer I wish I could say either one, but she is either she is a at home daycare or she's a Freelance nany basically A freelance? What was her degree in Nanny She actually ever finished college? I know Oh no. She got a degree in what She didn't finish. wasas it a private school? Priv It was it was a D one state school. Oh, so out of state, probably Yeah And it she Yeah. This is a bad situation Oh man. Bad's probably not the word. Dumb might be the word. U Wow What How close did she come to finishing us She had a little bit leftess. It wasn't a ton, but it was enough where it was like we can't afford to keep going The degree was in what? What was she studying? aelor's She was she was she started out in a education. She want to be a teacher And then she decided that she changed her mind and wanted to be she was doing business marketing, what I'm doing now. Thankfully the arrmy pays for mine. so we' o What do you make I make about fifty four thousand a year and she makes about thirty six. Okay And then I also have about I do have some savings, thankfully. I have about thirty five thousand four hundred and seventy dollars. in a mutual fund that just basically mimics the S andP And then also have just under thirty thousand in a money market. Okay. Okay, and you have how much out on her car still? none. That's all paid off. And the credit cards paid off as well. So the only debt left is one hundred seventy five thousand Yes, sir How are you guys I'm twenty and she's twenty three And you graduated from college as well U I am about sixty five percent through mine. I'm doing it online while I'm in the arrmy. You're in the army Yes, sir I thought you were in marketing Uh no, that that's what I'm getting my degree in Oh And is your school being paid for? Yes, answer... So so' fifty four thousand is your army service, your military service. Yes, sir, Yes, sir. And she makes thirty six thousand as a nanny Okay, and you have seventy thousand you have thirty and thirty five thousand sixty five thousand laying around All right. So ye, what I would do is u I would continue to stack cash until the baby comes And when the baby comes and everyone's healthy, Um I have bad news. Y wife is not going to be a stay at home mom She's going to be working. She has one hundred seventy five thousand dollars worth of debt she signed up for. And so she's going to be working for a while So we need to get used to that idea And because when you have your first baby, particularly It's a tremendous draw to want to be home with a child unless someone has a tremendous professional draw into the marketplace. And so you guys need the eighty five thousand. So let's pretend that you stack another ten thousand dollars worth of cash That's seventy five thousand dollars And when the baby comes home and is healthy From the hospital and Mommy's healthy and Mommy goes back to work, we write a check for seventy five thousand dollars I'm putting on this student loan And you have one thousand dollars in your account and you attack one hundred thousand with a vengeance and you guys work extra. You do everything you can, you sell everything in sight. When are you going to re up with the military I wasn't planning on it, but when you when will you leave the military I have two and a half years left. Okay, with a degree. With a degree, I will leave with a degree. Yeah. Okay. And then I will also make more as I as I standay. I would hope your income will go up ubstantially'll be it's going to be a three or four year. Yeah, you're going to be a while to get through this hundred thousand that' still remaining after the baby comes Yes, sir. But you guys are going to get used to working a lot Both of you to clean up this m. And it's a good thing that she is And what she does because she can be watching her baby along with anotherother baby or two.ing assuming the people that she's nannying for are good with that. yeah. Yep. That's right So There's probably there's some flexibility in it because if not, she's going to be paying for childca And it's going to be eaten into that. you know what I mean? Like you're Its it's not going to be thatu side and face palm because I feel so bad for this baby and this young married couple. That was terrible. That their' that they have been screwed. by student loans and by the whole Wh that Congress has put out by continuing to issue student loans Congress has screwed Americans with a student lo this generation. It's millennials and gen Z's. Yeahah. They're just they're screwed And you're sitting there and who loans somebody one hundred seventy five thousand dollars to get an almost degree. An eighteen year old Only the U.S Congress would do that. Only there's only one organization that's that screwed up And it's the U.S. Congress And they, Oh, there's a student loan crisis. It's awful. We should forgive the student loans, Biden said. Well, yeah, but you keep making them a bunch of Bozos. So why do we need to forgive them if you're going to keep making them You keep making these loans over and over and over. and some poor young girl goes across the state line and goes to another state to get a degree and oh wait, she didn't. Did you know that fifty four percent of the people that start four year degrees finish them That by definition means half don'k. And you get where she is. And she married a young man serving his country. Thank you, sir for serving your country And now they've got a beautiful baby on the way. What an awesome start to life, But they got this cloud hanging over their head full of knives the Congress set up and And we Americans have allowed this because we keep electing the morons that keep this stuff on the books They're called Cgressmen and Congress womomen They're morons Because they keep doing this over and over and over and over again. And then they talk about it like a politician It's awful. this. Well, you caused it. You can't talk about it being awful and you sit there and cause it And moms and dads, you ought to have your butt kicked up around your neck and wear it like a collar if you let your kid do this You really should I mean, what kind of parent says, Oh, honey, go live your dream. Go get a degree in left handed puppetry and go one hundred thousand one hundred seventy five thousand dollars in debt. Y parents ought to be smacked in the next week for your lack of backbone to stand up to your own teenager No, you're not doing that. That's stupid. That's a parental answer Welcome to a Ramsay Family meeting Hey guys, Dave Ramsey here. Every day on the show we help people work through real money problems and figure out what to do next. Now, you can get that same kind of help anyime with ask Ramsey. Ask your money question and get answers built on Ramsy principles we use on the show. Whether you're making a decision or just want something explained, ask Ramsey is here to help It's fast, simple, and free to use. Go to Ramsysolutions d. com and try ask Ramsay today. That's Ramsysolutions d. com If you're private student, loans are in default, when you've fallen so far behind the loan is considered unpaid, That's what default means Why Refine might be able to help. They help borrowers in tough situations explore Low fixed rate refinancing options that fit your budget Go to Yrefi d. com slash Ramsey. That's the letter Y R E F Y. Dot com sllice Ramsay might not be in all states. Today's question comes from Sam in North Dakota. My wife and I are twenty nine with no debt and are currently saving for our kids college. When the rainy day comes and you have to dig into your three to six months emergency fund, you pause investing and saving for college to focus on replenishing your emergency fund. Um, I would say depends on how much you have to dip into it. Hopefully you don't have to go through all the paperwork to pause all that especially retirement, having to go into HR and pausing it to refill it. But if it's a significant amount, yes, you probably would But in a perfect world, you would just cash flow some extra money and get it filled back up in the next month or two. Um Aain I agree It would depend. It kind of feels like this is a hypothetical. Yes becausecause in a if you have a situation where let's say you got fifteen thousand dollars in your emergency fund And you take twelve out You're probably going to stop everything for a little bit and rebuild that. And you wouldn't even ask the question. But most of the time, what has happened in reality with people we're coaching and in Dave Sharan's house and Rachel Winston's house is you know, you have a little bit of an emergency or some kind hit and you cash flow the emergency without even touching the emergency fund a lot of times. if not your emergency fund takes a little hit, a three or four thousand, five thousand dollars hit or something like that. and you just cash flow the replenishing like you were saying. Yeah. But if it takes a major hit, most people don't even ask they kind of know, I got to get that rebuilt. Yeah like if you lose a job For instance, I mean, everything kind of goes on pause until we the income back, you know, So that would that would just happen naturally. Exactly. S., you get the four hundred one K certainly would have been stopped. But but yeah, you stop your five hundred twenty nine, you stop the other spouses four hundred one K, that kind of stuff. You stop all investing while we, you know, get straightened around U But again, that You're diminishing your expenses or your money going out. R in order to not have to touch the emergency vine in that case Elizabeth Elizabeth is with us that is in Salt Lake City. Hi, Elizabeth. How are you Hi good, how are you doing? Better than I deserve. What's up So I fear that my husband and I have gotten ourselves into a bad situation. We just moved. into a new house before selling our old house. And then we also have some rental properties that are not currently rented. So We are basically drowning in mortgage debt and the house that we're in now We've been in for about a month and we're almost considering listing this house too and just seeing which one sells first just to get one sold. And so I just wanted to see, I guess what you would do in our situation. So the other two are on the market So one is not on the market. We're trying to get it rented. It's a dupl. it's a house with a b. Oh, no, no, no, no, not sell it Okay, so're bro don need a Okay. Um We just don't know that we could sell it We could make probably one thousand a month on it. We just don't I guess we haveven enlisted it, but we don't know that we could sell it to make enough money. But I mean I want you to sell it anyway. It's not it's not an asset. It's a liability because it's not renting for enough to screw with If you think you've got twelve thousand dollars gross cash flow, you know what that means? That means annually, you're probably losing money when you incorporate vacancy and repairs and legal fees for evictions and so on. Yeah, you're not making money. Okay That duplex has zero fun in it So list that and then just keep our other one. I get them both listed. get them both listed aggressively so I don't sell my new house. Okay. The house that we moved out of, we have had it listed for four months and we've had almost no interest. Drop the prige We've dropped it twenty five thousand. Drop it again. go. Okay, just keep dropping it until Yeah. And when you lose your butt on this Learn your lesson Yeah You should never have done this deal. Yeah. You turned yourself into a motivated seller. Yeah time And I hope you don't have sell your house. You may have sell your house though How much How much shor are you guys a month, Elizabeth A Well I don't really know. My husband does constr he has a construction company. so he Some months makeakes no money, some months will make fifty yearrand But we have we have about one hundred thousand dollars in our savings and we are feeling like for the next few months, if we keep all these properties, we're going to be taking out of our and then we have some credit card debt too. Yeah, how much credit card debt thirty thousand. Okay. Yeah, My hope is is that you can get these two properties sold really fast without having to dip into the hundred too much. and then you can write a check when that's done and get rid of the credit card debt. And you guys need to you guys need to quit living hand to mouth. construction business is I grew up in the real estate and construction business. And too many people in our world think we can out earn our bad decisions and chaos And I tried for a long time and I couldn't do it and I don't think you guys can either The problem with dropping the price on the house we moved out of is that right now, if we sold it at the price it's that now, we would make about one hundred seventy five thousand His dad loaned us the down payment for this house, which was one hundred fifty thousand. So the deal was that he would loan us that until we sold the house. And then we would use that money to pay him back So would it be worth it then to just keep dropping the price? I mean you' maning to write his data check out of your hundred thousand. Yeah Okay Okay You've become a that it's that or sell the house you're in. I mean, I don't care But you called me and said you're drowning. I'm trying to keep you from drowning. Yeah And you have to get very precise, very clear and sharpen your machete to keep from drowning and quit trying to hold on to all these different things with I'm going to hold ono this and the problem with this and I got to hold And it makes a thousand dollars and it's a stupid duplex in my daddy in law. And you know, you just you're gonna to have to go, something's going to give here. We better decide what it is or it's going to decide for us Yes. I think one of the bigger problems is my husband really wants to we have a few other rental properties that don't, I mean, make maybe a few hundred a month, but he wants to have eventually A bunch of rental properties You're gonna to go broke. You can't Yeahah, you're gonna to go bro. You guys are going to lose everything Elizabeth I wish I could just wave a wand and just create peace in your life. You guys are just running and running and running and it's not worth the stress He has he has wed off on this idea that if you buy real estate, it'll make you rich. Real estate will cause you to go bankrupt. If you're highly leveraged in it and you have no money I know I did it. I'm an expert on that. I have a PhD in that And so pop, you know just. You guys have what's the thirty thousand credit card deb? Was that just to keep somethingomet else Is that lifestyle or was that a specific that's my husband his for his business, he will like run up his credit card for a job that he's doing and then when he gets paid Yeah you're living y'all are all living backwards If you guys if you guys don't get your business organized and you don't sell off all this rental property and you're probably not going to. You're going to go bro You're going to lose everything. It's going to come crashing down around your head. I've done this for thirty years. You have all the symptoms of somebody who's going to be bankrupt in thirty six months. You're not going to make it If you don't get your freaking business act together and get your business acumen going where you actually know what you're making and quit running a dad gum construction company of this size out of your hip pocket with a credit card, That's just completely primitive. You're going have to add to your sophistication level to stay open and you're going to have to quit borrowing money up your eyeballs on all these real estate deals and acting like there's no tomorrow. You have to go to dad bought to do that you bought bought properties are cash flowing one hundred bucks. Tanslation, they're losing money every year. You're losing money on all of that And then you bought a house without having the other one sold and you're handcuffed to your father in law. I mean, you guys have done like a whole laundry list of everything that's going to cause people to go broke. And if you guys don't rush and undo that laundry list, you're going to go broke Yes, I hope I'm scaring you. I hope I'm terrifying you enough that you go in and put for sale signs on everything. And you hire a freaking accountant and get somebody under to straighten this construction company up and make sure it's actually making a profit, I'm not even sure it is. We may just be swapping dollars the way we do things over there You guys gotta stop us, Elizabeth, you're scaring me to death Hey guys, George Camll here. You ever feel like you make good money and still have nothing to show for it? You run into Target for one thing and somehow walk out eighty seven dollars later with toothpaste and emotional support candles? Just me, okay Well, that's the problem. Most people don't pay attention to how they spend their money, so it does whatever it wants. And that's why we created every dollar. It's a budgeting app that helps you create a simple plan for your money. Every dollar is simple, it's clear and it helps track where your money's actually going Plus, you get daily lessons, to do's, and reminders along the way It's like having a money coach in your pocket. Your money's been freelancing long enough. It's time to give every dollar a full time job Go download every dollar for free on the App Store or Google Play Adam is in Green Bay. Hey, Adam, welcome to the Ramsay Show. Hey, Dave, thanks for taking a call. Sure, what's up Well, I thought maybe I could get Dave Ramssey to tell me it's okay to buy a new vehicle. Nope That's the short answer, hna. Are you you do you have a net worth of a million dollars or greater? U notot exactly. Well, it's either yes or no. There's a not exactly. I mean, it's a math thing. It's a no. Okay. All right no. All right. thenen if you're buying a new car, you're losing too much in value. I mean, it's very simple. You can do whatever you want to do De, but that's I don't find millionaires that ask this question. People that become millionaires don't ask this question. They don't say, how close to the edge of being dumb can I get and still become wealthy. They don't ask it that way. They go, I want to stay way away from the edge. I'm going to drive an old used car and build up money because cars go down in value like a rock. That's where Chevy gets that All right, but what's your what's your what's the car? Yeah, well, I want to hear the numbers Yeah, well we kind of have our heart set on a Toyota Sienna. We're in Wisconsin, so all whll drive is nice This one cont tol, which would be really handy for us G've got a couple small kids who want to be able to have a little bit of extra room for holdting people around. so That's the one we kind of settled on. And the trouble is I would be very happy. My wife and I have talked about it it'd be very happy to buy a use model for a few years old or maybe even a little bit older that has reasonable miles for a big drop downown in cost But the problem is with this one Th you look at ones that are two or three years old and they're still going for virtually the same price as the new one. You got to get to one hundred thousand miles or better and you know, six, seven eight years old before you really see The priceices coming down In our case We'd be buying cash, you know, so we're not financing it. And even with paying the cash, we still have our emergency funds stocked. What's your household invo Uh, about one hundred eighty And this is what? an eighty thousand dollars car fifty five fifty five. And brand new they're going for what? Close to that Yeah, well, that would be that would be a brand new price. You know, tax setiddle and all that would probably be a little bit more budget fifty seven, fifty eight somewhere that b part And what other c do you guys have Yeah, well, my wife just got into a car accident, so we're kind of under the gun. And I have a Tesla Model Y that's also paid off Okay. And worse what Uh, probablyrob about thirty I'm just trying to twenty twenty four Toyota Sienna. I'll sell you for forty three thousand dollars because I can buy it right now for forty two. U anyywhere near me? I don't care if it's near you or not. for ten thousand dollars, you can figure it out Yeah, yeah I just looked it up online. It took me about half a second while I was talking to you Okay Um, In other words, your whole price scenario is absolute BS You've completely convinced yourself that the new one is the same prrize. It's not Here's another one for forty five and another one for forty five twenty twenty fours? Oh, twenty twenty fours. I should have Yeah, I'm sorry. I should have specified I think if you filter out the if you're only looking at the Ald wheel drive and with a toll, the ability to tow, I think that's going to change a little bit. So what are you towing We have a pop up camper in a trailer Mhm Okay And what's your other car? Tla U a testla onel line. Oh, yeah, you said that. I'm sorry, I missed that while I was looking up the Toyota. Okay Um, And u, All right, you can do whatever you want. but the thing that The overarching Decision making paradigm is what you have to fight against Um, and Number one thing that you violated is I mean, I haven't looked up. honestly just typed in twenty four Toyos Sant Just to see what they're doing. And they're all in the forty five, forty one, forty two, forty three. There's like seven of them on the first page. cameame up thirty seconds later and I haven't even I haven't even searched yet Okay. Yeah. So I don't know about the towing part of the all wheel drive part. And she totaled her car her car is wh It was a Nissan roogue and we were kind of we were already the funny thing is we were leaving the dealership from talking about getting the new vehicle once she got re ended.'s So So problem number one is and we all do this. so I'm not going to pick on you too harshly. I'm not going to mess with you because you're asking the question in a proper tone and I appreciate that. and thank you. I'll be nice. But so when I do the thing that you're doing U it's just I'm rationalizing and I'm trying to figure out a way to get what I want And you can probably afford it and it's not going to bankrupt you Okay So you do whatever you want to do, but I'm not going to tell you to do it because Um, you know, because you can buy this car ten thousand dollars cheaper than new one hundred percent chance you can. And you just hadn't found it yet. you haven't looked yet. You just had to be the urgency to replace And the, you know and you know you're moving up for God's skes from a rogue which is a completely different vehicle It's in a different class The SiNna's a bazillion times a better car than the road I'm really glad she's gots a minivan. I mean and you know, we love a minivan. Yeah, it's a great It's a great car. Maybe there's another class, a minivan that's the same they'll give you the same stuff, you know, the Honda Odyssey or something, right? What's the one you got That that what you the Odyssey? Yeah And so that's the qu It's the quQeen jewel. Is it is it more? It's probably more. I don't know. Probably similar. I got no idea. but It's a good car though. and I don't know about towing it. I don't know about all wheel drive. And both those things are okay. But the second thing is this You've got to adopt everyveryone, including you, Adam and including me the mindset of saying Okay, the rich get richer and the poor get poorer because the rich people keep doing rich people's stuff and poor people keep doing poor people' stuff. And middle class people keep taking out car payments on new cars that they can't really afford to pull a pop up camper He said he's pay He's notaking payments. but that's what middle class people do And you're going to lose ten thousand dollars when you drive it across the when you go across the curb and it goes blom blp, That was the sound of ten thousand dollars That's what that sounded like. Boom, Boom. That's exactly what it sounded like And so you've got to get out of that mindset that that's okay until you have enough money to waste that much money Now I waste that much money. I buy new cars But I've got several hundred million dollars in net worth And so I can afford the blop blump sound. It's not that big a deal Building, I'mitting in six hundred million So you know, you just that it's okay. but I want you to get there. I want you to be where you have millions of dollars whatever. you just threw out like insane numbers. Okay. No trouble of us just talking The point is point is The point is you build wealth by not buying things that go down the value's your largest situationch with your inc you have a unique situation. I do, but I care by doing this stuff. Yes. and also you make a great income. I mean, like yes, but for the but for people that we talk to that are that are doing this that are babys su millionaires. peopleople we talk to are different They're not different. We're not better than them. Not that we're better. What You just said you are sitting in a six hundred million dollars building Okay, we're normalizing life. everyveryone. The average person who makes four thousand. A millionaire. Can I do this doesn't.. the one hundred percent, but they don't have to sit in a six hundred million dollar billing do that. The average income in America is sixty four thousand dollars The baby Ss millionaires that we talk to do very simple things. They live on less than they make. They invest into their Roth IRAs and their four hundred one Ks They don't send tw thousandve hundred dollars car payments to car companies. they pay themselves. And they don't buy new cars. All of that. Yes. They don't buy new cars. So all that to say yes, you do not have. That's how they became millionaires. It is. That is how they became. the same point S serious. I'm dead serious. Okay, the average person isn't going to go and build a six hundred million North. That' not the point. And you said, the point is I said I or whatever. I don't want to be a hypocrite and say don't buy new cars when I do withithout explording why? I can afford to A million dollars, anybody Yes, if you' that worth a million dollars, can afford it. I can afford it. very. I want you to be able to afford it. We're doing this. I want you to be able to afford it. one hundred percent. And so ye, Adam, we were harder on each other than we were you. That's great You should not feel uncertain about investing and you don't have to. That's why we created investing Esentials, a two night virtual event where George Campo and I walk you through my playbook for investing and wealth planning. We'll simplify everything from four hundred one Ks and mutual funds passing on wealth So you can invest with confidence. Tickets start at one hundred and ninety nine dollars. Get yours today at Ramsysolutions dot com slash events or click the link in the show notes Script for the day Isaiah forty three, eighteen and nineteen, forget the former things. Do not dwell in the past See, I'm doing a new thing. Now it springs up Do you not perceive it I'm making away in the wilderness and streams in the wasteland Albert Einstein said a person who never made a mistake never tried anything new I like the Henry Ford quote too he says, Th of us who make mistakes have those who never make mistakes work for us Buying or selling your home is a high stakes proposition because one bad deal could really screw up everything. That's why Ramseay Trusted connects you with vetted real estate agents who are trusted by Ramsey because they're high octane, high protein. To find one for free, a Ramsey trrusted agent, that is, go to Ramseyolutions. com slash agent or click the link in the description. if you're listening on YouTube or podcast. Okay, there's some backstory and history that's worth going into to make sure that we settle that last little interchange exchange. Number one Um bottom line is is that wealthy people that we have studied ten thousand millionaires in our research do not buy new cars Even after they get their first one to five million dollars they're driving, the typical is out he was looking at a Toyota is honestly a two year old Toyota When I'm interviewing millionaires, I ask them all the time what they're driving and they drive a ten or eitheravy or they drive a crap old car and I tell them to upgrade their car because they're still being too big a tight one. They've gone too far But that's the millionaires. People who want to drive new cars typically land and stay in the middle class most of the time with high car payments. That's what our data says. So we're not going to tell you to buy a new car until you have a million dollars and you can afford the lastos. Z in Let's talk about me saying I've got sitting in a six hundred million dollar building or whatever, and Rachel not liking that because it's not relatable. And other people don't understand and they just blow me off because they don't want to listen to that. So the history is this I've got several brand new cars that I bought and I don't want to be a hypocrite. The first time On their Dave Ramsey show, it was called back in those days because it was I honor my elders things Be it was me. No, I'm not that's not the point. So back in the day when the dinosaurs roamed the Earth I was driving a What was that? I can't remember this number on the thing. The little Mercedes Bue. It was a blue littleittle blue Mercedes coop and it had two hundred thirty thousand miles on it. I bought it for seven thousand dollars It overheated on the way to a live event in Chattanooga. I was driving from Nashville to Chattanooga. The vice president of live events was in the car with me. We're on the side of the road and I'm pouring water over the water heater the radiator trying to get to cool off and get water back and to get to the live event And the car is worth probably at that point, three thousand dollars. I'd driven it in the ground. And he's like, this is ridiculous. you're a millionaire. You need to buy a good car And I said, I can't buy and I can't drive a good car and be on the radio telling people to drive junky cars so they can get out of debt And he goes, Yeahah, you can, you need to be the proof that it works on the other side., absolutely. And I like noone else later to live. Great I was so worried that Twitter was going to attack me. That was before Twitter. It was. It was. I was so worried that that people were going to hate me. The family I was inconsistent and I was a hypocrite and I bought a two year old jaguar, which was a very nice car at the time and upgraded considerably from like three thousand dollars to twenty thousand dollars in those days or whatever it was. And but I went through this great angst that it was okay for me to buy something nice when I had the freaking money. Yeah. so yeah, And so I had to over instead, I'm going to be the poster child that goes, you can go do this if you go do this. Yeah. And so That's why I still don't want to come on the air and say, I buy a new car. I bought several new cars and I can afford to lose that. So you're justifying saying here's what I have so that I can afford it. But I wasn't talking down. No, no No. I don't think you were talking down at all. I was just saying, you don't have to justify. Majority of people that listen, they know, they know Well, no, some of them don't. And you'll read it in the comments later after this argument, but actually will be because you read the comments and I don't, but everyvery now and then I will. James is in Chicago. Hey, James, how are you? Hey guys, I'm good. how are you? Better than we deserve for sure. What's up? So my mother in law's got a house that recently went under contract to sell for three hundred and thirty five. And then so a couple of weeks later in appraised for three hundred and sixty They haven't closed on the house and they won't for another two or three weeks. Is there any recourse for to close that gap at all Okay, somebody missed it The real estate agent I believe so. and you, I hear all your commercials about the trusted real estate agents and I think that was certainly the case. My man was one of our agents No, no, no, no. Oh no, I'm saying. I wasn't a great do. you think the agent screwed up in the original pricing and convinced your mother in law to sell her house too cheap I believe so. Do you think the appraisal is actually accurate Yes, I do because the houses I was surprised when she said we should list at three hundred and thirty five And then she went and sold it before it even listed. It was just kind of a, you know, friend of a friend situation. Not bad or by Jer. So it's thirty five thousand dollars underpriced or about ten percent. And there's already somebody C of contracts' supposed to close any minute You're you're Yeah Well, I'm Um The first thing that pops into my head, James, and I'm just going to off the cuff is Well, she sold her house too cheap as sad. ' she's given her word, she signed a contract And I don't want her to get sued for specific performance under this contract. Um, And then the second thing that pops into my head is I want to kick the incompetent real estate agents but Um Um, ethically I can't tell her to break that contract I wish she had done a better job and listen to you. I wish she'd done a better job at selecting her agent I bet I'm going to hear that this lady is in needs this money bad, doesn't she somethingomething like that Yeah Hsh It would help if she had it. we could put it that way. Well, it always would help. ye Um, Is there anything else going on in the deal? Is the contract contingent upon a whatever, whatever, whatever, like a like the sale a home inspection. Has the home inspection report come back? The home inspection came back clear. there's nothing pending there. The only thing I can think of is if their loan falls through last minute. I mean, there's sorry, I'm trying to think three weeks until closing. Yeah So I don't know if their loan is approved. I have no idea. but If there's if that falls through, we can relist And then, you know, we solve that problem Exactly, exactly. You know, and then and get a new real estate agent. Yeah Certainly. Yeah, I mean, unless there's something sideways in the contract deal that she can use to ethically get out. Like I knew a guy who had his house on the market U and the Radon inspection came back and found Radon and they wanted to spend five hundred dollars. to fix the radon. And he said, no contracts over and Clint canceled the whole thing because he wanted out the deal and he used that to get out of the deal. But he had a legal ethical out because he refused to fix the radon. and he had the right to do that in the contract. So Um You know, that's the kind of thing like if they came back with something in the home inspection, you say, well, I'm not going to do that. You can do that. That's part of the home inspection process. And then they would go, well, you know, okay, we'll take it anyway. No, we're not going to fix it. and we're not based on this home inspection, we're not selling the house. You could just, I mean, there'd be a way to walk out of it then legally and ethically, but I don't think there is here Um, you know, I'm not an attorney in Illinois. you might ask one to be sure. Just to see. I know. but I would compompetent real estate agents are important. I know. and I would feel bad for that family on the other end who's in contract for something then you kind of go back on your word. Yeah Just from like a I mean, it's worth it. or it's worth the I'm saying like the new price is what the house is worth. I get it. We think it is Yeah That still feels strong off. you gave your word. You sold the house. Yeah. And people walk away from contracts like they walk away from everything in this society today too much. You should honor your word And so I hate it. I don't like it. I've signed up for things I wished I didn't sign up for, but And also too, it's a, you know, the To sell a house today is harder than it was a few years ago. So she may have even, even if it was at three hundred sixty had to negotiate down some anyways, right? So you may not have gotten the full sixty anyways. you would never know Sorry So you should get a high octane high protein Ramsay trusted real estate agent or you shouldn't get one at all This is what you get. You make a mistake. it's a thirty thousand dollars mistake. It's huge That puts us hour of the Ramsay showhow in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace and that's to walk daily on the with the prince of peace, Christ Jesus.