If You Don't Choose Your Pain, It Will Choose You
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Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships.

Rachel Cruz, number one best-selling author and my daughter, host of the Rachel Cruz Show, co-host of the Smart Money Happy Hour and a bunch of other things as my co-host today. We're taking your questions about your life and your money. And you're back. I'm back. I know. There was a bet going on on social media if you would ever come back. Everyone was like, where is Dave? Proof you can't count on social media for anything. I know. Well, welcome back. America missed you. Glad you're here. Sharon and I have been...

down south for a month and a half and took a little time off. We've never done that in the entire working life, so I've never taken that much time off, but so I'm ready to be back. I'm getting stir crazy, proof I'll never retire because she would not let me, but yeah, we had fun though. We had a blast and it's good to be back in front of the microphone again and

We can put all the fears of the YouTube commenters to rest, I guess, or whoever it was that was commenting. You're still here. You're still here. I didn't know that there was a commenter, but you saw the- Yeah, a couple were like, I mean, he may never come back. We don't know where he is. And usually the first show with Dave Back, he's a little feisty. So read and everyone get ready. It's because I get afternoon coffee. That's what does that. So, yeah.

Open phones here. We'll talk to you about your life and your money. The phone call is free, and some say the advice is worth exactly what you pay for it. 888-825-5225. Let's start with Reed in Dallas. Hey, Reed, what's up in your life?

Hey, I'm doing good. How are y'all doing? Better than we deserve, brother. How can we help? Yeah, so I'm just trying to figure out if my wife and I are kind of living recklessly. We make, you know, good money, but we also spend, you know, a lot of the money that we have. We followed your plan. We paid off $100,000 in debt a couple years ago. Now our only debt is our house. But yeah, again, we just kind of, we spend most of what we make.

Why? Why do you feel like you're, why do you, you think you're out of control or you wouldn't ask the question? Well, I mean, we take multiple vacations a year. We go to, you know, Europe or Asia pretty much every year or somewhere in the Caribbean. I mean, we do, we still save about 20% of our income. Are you still doing generosity? Yes. Okay. So you're generous, you're investing, and you're enjoying your money. What's out of control?

I don't know. It just made me feel like we should be saving more. I mean, we make, you know, after taxes, after 401ks, you know, it's about $13,000 a month. I'm just, yeah, do we need to be saving more? I don't know. Because you're the saver and she's the spender. I buy stuff too. But of the two, you're the saver. Yes, sir. And savers never save enough and spenders never can spend enough.

That's just nature. I mean, I get it. I can tell you no matter how much we save, Sharon looks at me and goes, are we saving enough? Because she's the saver and I'm the spender. Okay. Is it just your tendency or do you really have actual data points that say I'm out of control? It's probably my tendency. Again, I mean, we both have. We max out our 401ks and save into our own investment accounts on top of that. And how old are you? I mean...

30. And how much is in your 401ks now? It's about $200,000. And when will your house be paid off? About 10 years. Okay. So you'll be a millionaire at 45 to 50? Not too bad. Okay. Now, do y'all read, you said you saved 20% of your income. What percentage of that goes into retirement investing and what percentage do you guys have saving just maybe short-term savings? It's kind of just some liquid cash on the side.

Liquid cash, we probably have about $80,000 right now. Including your emergency fund? Yeah. Yes. Okay, and how much do you owe on your home? $185,000. Okay. Well, of course, if you're following the baby steps that we teach, you would have only 15% going into retirement, and you would have only three to six months of expenses in liquid cash, and everything above those two numbers will be going on to the mortgage, so it would be paid off in five years instead of ten. Okay.

Okay. Because you're going to put about half or three quarters of this $80,000 on there. Boom. Now we've got $120,000 mortgage, and we're going to quit putting so dadgum much in the 401k, another 5% a year, which is another $5,000 or $10,000 going on the house, in addition to what you're already paying on the house. Yeah, you're done in five years. Now when the house is paid off and you're 35, it's starting to feel pretty good then.

I would think so. Yeah. Yeah. And I would say, too, for you guys at that point, you'll be 35 on baby step seven. And there may be other financial milestones you want to hit. Maybe you want to buy a second property in cash. Right. Or you like you maybe you want to do something else that may slow down your lifestyle in order to hit these other goals that you want to have. So that may be the case. But for where you guys are right now.

I mean, it sounds like you do well. So I think that you need to, I would adjust those two numbers if I were you because I think it's going to get you to your overall goal faster. And I would institute a, for a little while, you don't have to do it forever, but for right now, at least once a quarter,

Go somewhere with your wife for three hours and don't do anything except look at the numbers and dream and say, okay, let's get aligned on what we're doing. Because I kind of think y'all put this on autopilot and it's disturbing you. It's not bothering her a bit.

That sounds right. I was just used to, you know, that kind of gazelle intensity. Yeah, yeah. Well, and you just worry about the numbers all the time, and that's okay. There's nothing wrong with that, as long as it doesn't start becoming anxiety-inducing. But paying attention is a good thing. But I think the two of you getting aligned and her hearing...

that you're concerned about this is a good thing for her to hear yeah and read and I would encourage you guys the house will be the next big goal but always have a financial goal even a baby step seven have something you're working towards like Winston and I one of our big goals was to build a house and we moved in in 2019 and there was probably a year I mean 2020 hit with COVID and everything but I mean maybe a year year and a half or we didn't have another big goal and you do look up and you think oh gosh like

Am I being wasteful? Yeah, it's just kind of that feeling. So I think there's a natural health to saying, hey, there's something else our money is going towards besides just the 15% and building wealth and all of that. But there's these other things that we're saving up for. And I just think that's a good rhythm to be in. It's just to kind of always have that thing out there that you're always thinking about and working towards as well. That makes you feel less like floundering. Yeah, and the goal can be a systematic change

increase in your generosity and go, you know, like, you know, I want to give away X.

By the time I'm 40, I want to, I want to, I want to build a wing on the freaking hospital. I don't know what, whatever it is you want to do. I don't care, but that can be your goal. It doesn't have to be something you're doing for your own net worth. It can just be that, but you got it. You really need to have, if you aim at nothing, you'll hit it every time. That's your point. Yes. Yeah. And you're exactly right. Well, it just feels like you don't have anything that you're like, you feel, you feel listless and shifting. Yeah. And that's a little bit about what reads feelings, feeling a little bit, uh, uh,

untethered. Yeah, exactly. So if we get an alignment and we discuss in high definition what our dreams are, we align our high definition dreams in our marriage and then we go, okay, I heard you, but I think we're okay. Okay, now that you heard me, I think I'm okay. You know, that kind of thing. And just get aligned on that and say, this is what we're doing. Then you can make decisions like that. That's a cool thing. This is The Ramsey Show.

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NMLS ID 1591. NMLS ConsumerAccess.org. Equal housing lender. 1749 Mallory Lane, Suite 100. Brentwood, Tennessee 37027. Thanks for joining us, America. I'm Dave Ramsey, your host. Rachel Cruz, Ramsey personality, number one bestselling author. My daughter is my co-host today. Michael is with us. Michael is in Davenport, Iowa. Hey, Michael. Welcome to the Ramsey Show. Hey. How you doing? Better than I deserve, man. What's up?

Good to hear. All right. So this basically is just a question on my life spending habits and my saving habits. I'm a hog farmer out here and right now I currently own three hog farms and I own one house. It's all paid for. I have zero debt to my name, 31 years old. And

And the big question is my wife, she wants to buy another house. The problem with the house that we have now, which I don't have a problem with it, I grew up in it, it's too close to our hog sheds. So the smell is a big problem. Well, so we rent a home and

that's about five miles from the farm to kind of just to please her, to get the smell. She doesn't like the smell. Well, the house that we rent, the landlord passed away about two months ago and he left in his will that we have rights to buy the house from his daughter. Well, his daughter doesn't want to rent. She wants to sell the house to us. I have saved up a lot of money and

and I do not want to buy a house. I would rather buy a hog shed. Now, I don't own the hogs. The company owns the hogs. They rent the buildings off of me and I take care of the pigs. I have saved up $431,000 right now is what I have and I would rather go another two years and buy another hog shed to put on the farm. And the hog sheds do two things.

The company pays the bill, pays the rent on the first of every month or never a day late, which is good. That's why I don't rent to people. Michael, how long have you been married? Four years. Okay. There's a buddy of mine that's a comedian and has a wonderful saying, happy wife, happy life. So far, we're there. No, you're not. No, you're not. You're a hog farmer that's gone hog wild. All you think about is hogs.

And I love that. I think you're a business guy and you're great at what you do and you got it dialed in and it don't bother you and lick. Your wife ain't going to stay there, brother. She done told you that. You need to listen to her. I need to be looking at buying this house. You need to write a check.

And the house is only $45,000. It's a wonderful... Shut up. It's only $45,000? You can make her happy for $45,000 and you're buying a $400,000 hog shed? Michael. This woman doesn't ask for much. And absolutely. And to be honest with you, she's the one that shows up when the help doesn't. Yeah. Well, I mean, she did marry you. Yeah. Knowing that she was going to live next to a hog shed. Yeah.

So, I mean, you must be a prize. You'll have kids, Michael. She's coming in there. She's awesome, man. Look at you. Wow. Dude, buy the house. I do have twins. That is three. And our oldest daughter is six. Oh, yeah. Is she home with them all day?

Yes. Yeah. Yes. She works part-time. You're a great farmer and a great businessman. You know your numbers inside and out. You take care of all the details. I can hear it. I've worked with entrepreneurs for 30 years. I can hear everything about your business acumen. I think you're very, very good at what you do. You suck at taking care of your wife.

you need to buy her a house you need to buy her a house i know and michael i'll say this i feel like you're getting beat up on this call there was a lot of eyes i saved up this and i did this and i did this and i did that and you guys are a team and part of a team is there's an a and a b it's not just an a and bring her in she has as much weight and as much value to the conversation and what how she wants to live her life as much as you and it

I'm poking fun at you, but I'm having fun with you. But in all truth, she's not asking for much, and you can easily provide what she's asking for. She's not asking to buy a $4 million house. Correct. She's not asking you to sell off your hog farm. Correct. And she's not even asking you to slow down, because the $45,000 is not even going to slow down. You're not going to build that shed within $45,000 estimate anyway, probably.

No, a new shed now is the dirt work and everything is about $930,000. Yeah, so we've got a little while to go. Anyway, so buying this house is not going to throw your goals off is my point. You're on your business goals.

And, um, and what I have figured out in doing this for this marriage thing for 43 years and doing this business thing here at Ramsey for 35 of those is that the best thing I can do is have no drama at home. Cause I got enough of it at work. Gotcha. And it makes me more valuable when I'm at work. Yes. Yes. Amen. I know. I'm convinced one of the reasons that Ramsey is successful as it is, is that your mother is no drama. Yeah. Yeah.

and doesn't ask for much. And neither does Michael's wife. She doesn't ask for much. Right. And she would feel valued in what she brings to the table too. Right. And there's that, and there's that extension to say, yes, like listen to her, Michael. We were looking at an investment thing a week ago and walk through it all. And, and she's like,

I don't care. And then I said, I know you don't care, but we're going to walk through it because I want to see if your eyes roll. Yeah.

I want to see what you really do care, but you're not going to say it. So I want to see if you shift in your seat. I want to watch your body language while you're looking at this. Because I can tell what she's thinking. Sure. We've been married long enough. And there's a vow. Who can find a virtuous wife for her worth is far above rubies. The heart of her husband safely trusts her and he will have love.

no lack of gain. Proverbs 31. It is a financial principle. If you'd like to have no lack of gain, listen to a virtuous wife. Not a Cinderella, not a princess, but a virtuous wife. And everybody, as you said, has a vote. And then we make good decisions together. That's right. And now you are one. And everyone from California should move to Iowa and buy a $45,000 house. That's...

That's unbelievable. That's so fun. Go. Go, Michael. Enjoy it. You guys will make it a home. It's going to be great. I'm excited for you guys. I love it. That's fabulous. Good for you. Good for you. And what a great business guy. He really is. Yes. Wonderful. And you're 31. You're going to do great. You're going to do great. Olivia is in San Diego. Hi, Olivia. How are you? Hi, Mr. Ramsey. I'm good. Thank you. How are you? Better than we deserve. What's up? I am just calling. So we are on Baby Step 3. We just got out of debt.

We're in Southern California, and just to condense my question, I'm essentially wondering, should we move someplace less expensive but leave our family, leave our church, leave everything? You know, we have two kids, in order to build wealth. What do you guys make?

So my husband made $70,000 last year. I work on his days off. I'm an independent agent, so my taxes are like 13%. He pays when I go back. What do you make? I made $30,000 last year. Okay, so you have a $100,000 income in San Diego. Mm-hmm. Okay. Where are you guys living now?

So we're in Carlebad, California, but we're looking to go to Arizona. The way you asked the question, the way you formed your sentence, you don't want to leave? No. Okay. Because you made it sound like we're only doing this for money. The only reason we're going to Arizona is for money.

Yes, that's the only reason. But right now, I am working so hard to try to keep my daughter in private school, Christian school. Yeah, you don't have a sustainable situation where you are, right? No, but we have support. I'm sorry, I wasn't thinking I was going to cry. That's okay. We have help right now with our family. Yeah. Well, it's heartbreaking to move away from the grandparents, but you're either going to change careers to be able to sustain the situation...

Or you're going to make some different choices like not private school to sustain the situation. Something's got to give. What you figured out is the math isn't working, and that's very wise. Now, what's going to give? Private school, career change, or a move? Really, one of these three things, and all three of them are painful. Choose your pain because it'll choose you if you don't.

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Rachel Cruz, Ramsey Personality, is my co-host today in the lobby of Ramsey Solutions. You can stop by and hang out with us anytime you want if you're in the Nashville area. We do this show on the glass, and so you can watch it happen. And that's from 1 to 4 Central Time. The cookies are homemade and they're free. The coffee's free.

And, hey, we love having you. We come around, we come out to commercial break, get books signed and take pictures, all kinds of things. Also in that lobby is what we call the debt-free stage. And Christy and Steve are on it, which can only mean one thing. Hey, guys, how are you? Doing great, Dave. How are you? Better than we deserve. Where do y'all live?

Wilder, Kentucky, right outside of Cincinnati. Oh, yeah. Just across the line. Okay. Well, welcome to Nashville. And how much debt have you guys paid off? $351,840. Wow. And how long did this take? Nine years and eight months. Nice. Nine years and eight months. Good for you. And your range of income during that decade? We started at $36,000. Mm-hmm.

And we are now at $287,000. Well, there's a nice move. Okay. And so what do you guys do for a living? I'm a sales manager. And I'm a chiropractor. And I own my own business. Okay. So you got the business, you got the practice working and the sales manager's working and you're kicking it. Yep. Way to go, you two. So I'm guessing with this length of time and this amount that in Northern Kentucky, Southern Ohio, you might have paid off your house. No. No. Oh.

Oh, wait a minute. I left out the chiropractor part. It's your fault. Okay. Yes, sir. Yeah, the chiropractor debt of $200 was of that, right? Yeah, we had a small, I had a car. We had about $7,000 left on that.

and about $1,500 in credit card debt. But we paid it off every, you know, at the time we were paying off every month. So we paid that off and the rest was student loans. Yeah, over $300,000. Yeah. Well, that's where it ended up after all that time and interest. Sure, sure, sure. Yeah, yeah, yeah. But yeah, there was undergrad in there, quite a bit of interest there. And then, yeah, chiropractic school. And his master's. Oh, yeah. And my master's degree. So the nine years and eight months,

I'm guessing that that's when you came out of school. Pretty much. And just started the practice, and you guys were just newly married and get things going, I'm betting. Okay. But I'm also guessing that at some point in those nine years, the intensity suddenly turned on.

Was it from day one? Pretty much. So we had just bought a house. He had just started his practice and we had no money. And I was working part time and also helping him in his office. And we realized we had an income problem. And so my cousin told me about Dave Ramsey and I checked the book out. He checked it out. We made a budget and we wanted to start a family, but we had no money. So we had to

We put every dollar we had together and got started and I got a full-time job and just went up from there. Yeah. And every time the practice went, we threw it at the debt. Every time they got a sales commission, threw it at the debt. Every dollar. I changed careers actually through COVID. I was laid off and then stayed home with the kids for a little bit. Wow. Yep.

So you had two during the time. How old are they now? They are seven and six. Seven and six. Okay. We're in the middle of all this. For all the young families listening, you guys started it before kids, during kids. You're raising little ones during it all. What would be the hardest thing, would you say, about the journey? Well, with the kids, it wasn't a really easy process. So they were both born. Both of them required...

uh, emergency procedures. Um, the older one needed surgery three weeks after he was born. Oh my gosh. And then medical stuff on top of this. Oh yeah. Oh yeah. The second one was, um, it was very emotional. Um, Chrissy, uh, abrupted, which means she started bleeding. The placenta pulls away. Yeah. Um, and he had to be, um,

Delivered it 34 weeks. Spent three weeks in the NICU. Wow. Came home for two weeks, then got a RSV and almost died again. Luckily, he knew CPR. Honestly. Yeah.

Wow. Oh, y'all, you've been through it all. Yeah. So we had our deductible three years in a row of $6,000 in there as well. Yes. So there was another 18 grand right in there. And I had two under two and my 90-year-old grandma lived with us for three years. We were taking care of her at that time up until COVID happened. Okay. Yeah, we were. So y'all have had a whole journey through this nine years. It was a bit. A decade of life. Yeah. We're so excited to be here now. Yeah. So it was paying off debt.

Would you say it's like, oh yeah, that was like, oh, we'll throw that in too. Right? Like, I mean, it almost becomes that like, yeah. After experiencing this with like with your kids, it's like, we can do this. If we can do that, we can do this. Yeah. Yeah. It was, it's, it's been a heck of a journey and it's been great with these kids and we're so happy to share it with them. Sure. So great. Now that the dad is a hundred percent gone, how's that feel? Amazing. Yeah.

The light at the end of the tunnel felt so far away for so long, and so it's really exciting. It was. It was. Yeah. We're renovating our house now and all cash flowing that, and excited to be able to do things with our kids and change our family tree, and we're so excited. Yeah. I mean, nine freaking years. Yep. From $37,000 to $287,000. Yep. I mean, that's a quarter of a million dollar swing and two babies. Yeah.

Oh yeah. Yeah. And some NICU thrown in. Yeah. Oh my goodness. Yeah. Wow. Wow. Amazing. Amazing. What do you tell people the key to getting out of debt is? Cause you stuck with it. I mean, you persevered. Oh yeah. The, I think the biggest key was the budget. Um, even at, you know, our $36,000 initial starting salary, we were finding, you know, $500 a month and putting that towards our debt and started that, that ball moving. And, um,

You know, we were avid listeners of the podcast, you know, even when we couldn't see the light at the end of the tunnel, that podcast, you know, we heard other people doing it and it really helped us out a lot to, to hear about those, you know, those stories and how people are, are, are making it and it can be done. Yeah. Yeah. When we were about halfway down, we drove by and did a family selfie in front of Ramsey solutions out here. So little things like that was like, all right, come on, let's keep going. We can do this. We can do this.

I'm so glad that you took inspiration from all these other debt-free screams and now you get to be one. Exactly. That's pretty cool because there's somebody out there with a baby in a NICU that doesn't know if they're going to make it and you're just telling them they can by your presence. Oh, yeah. Oh, yeah. Just keep going. Well done. Congratulations, you guys. Proud of y'all. Thank you. Who was cheering you on saying go, go, go, go, go?

Honestly, we were very private about it. We kept it, you know, pretty close to the chest. Until now. Our family knew, but pretty much kept it close to the chest. So we didn't have a whole lot of...

I guess that really... Or naysayers for that matter because it was just none of your business. Everyone knew what we were doing, but yeah. Good for y'all. Way to go. Very cool. Congratulations. So proud of y'all. What's the first big thing you do now? Get the house paid off, I guess. But other than that... Yeah, get this house renovated and we're going to start traveling. I really want to share the world with our boys. It's something that I...

wasn't able to do as a kid we didn't grow up with a lot of money my family had a hard time with money all as i was growing up so i'd really like to let them experience the world amen that's a great legacy good for you well done all right what's the young men's ages and uh let's introduce them their names and ages bring them up

This is Ashby and this is Austin. Ashby is seven and Austin is six. All right. Have they been practicing their debt-free scream? Oh, yeah. We almost got kicked out of the hotel this morning. Oh, wow. Okay. That's good. Well, the hotel needs to know about this. That's good. Yeah, that's very good. Hey, we've got the Baby Steps Millionaires book for you, Total Money Makeover book, and the Financial Peace membership. That's the live and give box for you as our gift package.

Thank you. For saying thanks for coming down. We're so proud of y'all. Way to go. Thank you. All right. Christy and Steve Ashby and Austin from Kentucky, just south of Ohio there. $352,000 paid off in nine years and eight months, making $36,000 to $287,000. Impressive. Count it down. Let's hear a debt-free scream. All right. Ready, boys? Here we go.

Three, two, one. We're dead free! Yeah! Wow. Wow. They are cool. That is very cool. Good for you guys. You're inspiring. It's a lot of life in there. A decade. Wow, that's impressive. And now, I'm going to show my sons the world. I love it.

Just like that. This is The Ramsey Show. Rachel Cruz, Ramsey Personality, is my co-host today. Danny is in Miami. Hi, Danny. Welcome to The Ramsey Show. Thank you so much for having me. Very excited. Well, good to talk to you, sir. How can we help?

So, uh, this is kind of nerve wracking cause I, I'm not really good at talking about, you know, finances and stuff like that. But the main point of, uh, the reason for my call is because me and my fiance who were getting married in July in Montana, but, uh, she inherited a house from her grandparents after they passed away. And, uh,

Where right now it's been a rental property for a couple decades, right? Where somebody in the front of the house has been renting and then somebody in the efficiency in the back has been renting out, right? It brings in, well, right now we're renovating it, the back end of it. But we know that once we get it fixed up, total should bring about maybe $4,000 a month in rental. Her perspective is that she wants to move in into that house. The house is paid off.

Where is the house? It's in Miami at Coral Gables. Oh, okay. But you're getting married in Montana. That's what threw me. Okay. Yeah, yeah. Okay.

Uh, so she wants to move into the house, which is paid off, right? Just to maintain it would be about $1,500 a month. Uh, aside from the 4,000, if we kept it rented, my standpoint, or at least my perspective is that if there is a scenario where we can, and I know you're all about, you know, cash, cash, cash, right? Um, if finding a home using the benefit of my first home buyers, right. To, uh,

Find a new house and then use the rental property monthly money to pay off its mortgage of a new house. Because my perspective is I really want to maintain a rental property instead of just moving into the house that's paid off. Okay. How old are you, Danny? I'm 28. Good for you. And she's 27. Good for you. Well, I share your love of real estate investing. I believe in real estate investing. I own a whole bunch of real estate. I love it.

And not everybody should own real estate. You have to deal with these things called tenants. And so sometimes you shouldn't own real estate, but I, it is not a problem for me. I do conflict well, so, um, I can handle it. And so, um, I I'm with you on owning investment real estate. Uh, Rachel's husband does real estate for a living, runs our family real estate and has his own company as well. Uh, and so, uh,

You know, we both of us love real estate. And so we share that with you. We do also know that the shortest distance between where you are and wealth is to become and stay debt free house and everything. That's why we're cash, cash, cash, cash, cash all the time, because it's the best thing for you. It doesn't affect me. If you go buy a house on debt, it affects you.

So it doesn't, once we get off the call, my life's going on and you're going to be dealing with a debt, not me. So, but, but, but I love you and I want you to win. I want you to go out there and be big time wealthy. And the shortest distance is not borrowing money on a residence and keeping a paid for inherited rental. So if you're going to follow that advice, then you've got two choices actually.

One is do what your fiance thinks is okay. Move into one of the properties, move into one side, rent the other. It's paid for. You have zero debt and you're a young married couple with no debt. That's a very nice place to be in a very unusually wonderful place to be. You have your entire freaking income to invest and pile up some money and buy your first rental otherwise with cash. And that's what I did after I went broke years ago in the real estate business by borrowing too much money.

So that's one option. The other option is probably emotionally painful, but also mathematically is just as valid, and that's sell the inherited property, use that cash, and buy your first home for cash. Now, I don't think that's going to be real appealing to your fiancé because this was her granny's place, and it's been in the family even though it's been a rental for years. She's got some emotional attachment to it. So suggesting that might not be a winner for you.

Probably not. Yeah. It's a good house. I mean, it's in an area that's very... Her grandparents bought the house for, I believe, like $100,000. It was years ago. And now it's about worth $750,000. Yeah, and for $750,000, you can buy a pretty decent home in that area.

If you pay cash for it and sell that house and pay cash. Mathematically, that's fine. But she just got this. You're just getting married. There's a lot of just starting things here. So I would not do your suggestion and I would not do her suggestion long term, but I would do it initially. And the way I would set it up with her is say, listen, I don't think long term we want to live in this house.

next to renters but but i also and that's why yeah even though it's granny's house and even though it's inherited and all that but there's nothing that there's nothing uh nostalgic about a piece of real estate in most cases so what i would say we do is we live in this house for a year or two years and then we sell it and use the money to buy a house

But for right now, we're newly married and this inheritance is fresh for you. And I want to be sensitive to that. So let's give it a little time. But I don't think we want to 10 years from now be living in this house. And I think she'll agree to that because she probably doesn't either. She's just looking at, oh, I can live here for nothing. And I just got this.

So, you know, I would suggest you spend a year to two years in that house as a marriage investment. Yeah. Yeah. And then sell it and move up. But no, I would not borrow money to buy another house with your first time homebuyer.

Not while you've got a place to live for free. Your fiance has a point. But also probably, unless it's her idea, would not sell it today. I don't mind. The only thing that bothers me about selling it today is the emotions of it. I think selling it today would be a fine idea. Nothing wrong with it at all. Yeah, but she probably wouldn't go for it. Yeah. Probably going to feel weird to her. And the family might go, oh, well, she married that guy and the first thing he did was sell off the house. Well, that's because he's got sense. But, you know.

Yeah, it's a good thing to sell it off, actually. I'd be rid of it and go buy a house. But I don't know that that's going to work relationally in a brand new marriage situation that hadn't even occurred yet. Yeah. So it doesn't occur till July. But I'm trying to think about all the angles on this. But Danny, yeah, you're thinking like most people think that get in trouble with real estate. And that is that the tenants are going to pay the bill. Tenants sometimes pay the rent.

sometimes there's tenants. And when there's tenants, sometimes they pay the rent. There's a lot of sometimes in there. In those other times, you pay the freaking payment. And so that's how that works. Well, and there's no payment on this one. If there's no payment, but I'm saying. But using it to buy another house. If you're using it to cover your other house, then yeah, you get to pay your house payment, dude. Yeah. So, you know, this, you can tell a brand new landlord when they think they're always going to get their rent. That's a brand new landlord. That's somebody who's never done it.

Because it doesn't because you don't hello and there's all kinds of stuff happens. I mean sometimes it's sad things now Winston was managing one of our properties and We gave this these people four months free rent because the guy was diagnosed with a terminal cancer Yeah, he was gonna die in four months last thing I'm gonna do is evict this woman in the middle of her losing her husband and

And but I can afford to be that generous if I want to be because I don't have any payments. Right. Right. But and that was just a sad thing.

And then she needed to move on anyway after he passed away. So, you know, it wasn't a long-term situation, but you can afford to do that. But for people like Danny. You don't always get your rent. That's my point. Yes. But for people like Danny, because the real estate game, it's always been there, but I feel like it continues just to bubble up. Social media has made it popular to be stupid again. Well, it has risen of like, hey, here's another way to invest your money and how to grow wealth.

And how to become wealthy. Leverage. Yeah, that's how most people, if they get into the game, that's where they have to start out, right? Is leverage. So how do you encourage people to say, okay, this is how you start. It is cash, but

but do you is there a formula where it's like okay you know uh you pay off your primary home or in everything become 100 debt free on your personal residence and then save up with no payments of any kind you can save up money real fast and you'll probably get a condo or so like you'll start small your first property buy your first little thing and as you build it up but i think some people it's it feels defeating of like i'll never be able to get into the real estate game

I was with a guy's podcast this morning. We were recording it, one of these big YouTube guys, and wonderful guy. And he was quoting Charlie Munger. He said, you know, one of the things that hold, Charlie Munger says three things hold people back. Liquor, ladies, and leverage. Oh my gosh. That'll set you back. This is The Ramsey Show. From the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth.

do work that they love, and create actual amazing relationships. Rachel Cruz, Ramsey personality, number one best-selling author. My daughter is my co-host today. Open phones at 888-825-5225. That's 888-825-5225. Paul's with us in Cincinnati to start this hour. Hi, Paul. How are you? Hey, Dave. Doing better than I deserve. How are you? Just the same, sir. What's up?

Okay, so about five years ago, my aunt convinced my 92-year-old grandmother to change her will so that only she would inherit the property that my grandma owns on a lakefront in Florida when she passes. My grandma's 97 now, and her health is not very good.

I was wondering if it would be wise to try to acquire the property by means of a property tax lien after my aunt inherits it and she inevitably fails to pay the taxes on it. Okay. So your aunt did talk to her grandmother into doing something where the rest of the family got cut out. Is that what you're angry about? Am I getting this right? That's right. Okay. Well, I don't know Florida law, but that's probably not going to work.

Um, and sometimes you hear these guys and you may have seen this, that may have been what prompted your idea. These guys in the real estate, get rich quick world. Uh, and they say, go buy tax liens and you can just, you know, you buy people's back tax position and then you become the owner of the property and it's just easy. You can just do it all. Listen, I've done it like six times when I, when I used to do real estate for a living and I was doing foreclosures for a living, never ended up with a single property.

because most states, including the one I'm in, have a right of redemption that is one year or two years. So let me give you an example. If Florida has that, and I don't know Florida law, okay, but let's pretend Florida has a two-year right of redemption, which is pretty standard. Then you buy the property for the back taxes, okay?

The property sold because she didn't pay her taxes, and you buy it for back taxes, and you buy this million-dollar property for $100,000, okay? I'm making this up, but you follow my example so far? Yes, sir. Then the former owner of the property has two years to give you $100,000 to buy the property back. That's the right of redemption. Okay.

And you can do nothing with it during that two years, because if you do, you're going, let's say you're going into a hundred thousand dollars worth of renovation, then they can redeem it for what you paid for it only. And you'll lose your renovation money. Right. Right.

Uh, if you take out a mortgage to do this and you pay payments on the amount, the a hundred thousand dollars you borrow to buy the tax lien out and you pay payments on that, you don't get any of the payments back. All you can get back from the other owner when they buy it back from you is what you paid at the auction. So, and I'm okay with that. No, listen, here's what's going to happen, right? If she loses it and she knows she can come back and get it for a hundred grand, it's worth a million.

She's going to go get somebody to buy it. And so she'll come back, give you $100,000, buy back and resell it the instant she does that for $500,000. The other guy gets a deal. She puts $400,000 in her pocket and walk away. Unless she's an absolute lunatic, she's not going to walk away from a huge equity in a property tax state that has rights of redemption.

So it's just you do say that's crazy in every family, right? Yeah, this is this is a different kind of lunacy. I'm talking about this is like you're anyway. So did she say she convinced your grandmother is your grandmother not all mentally like did she do it from a almost an illegal standpoint of her not being your grandmother not sound of mind. She was deemed not sound of mind about two months after the will was changed.

Well, I would dispute the will then. I think you're better off to dispute the will on that basis. Okay. Because she didn't suddenly lose her mental faculties within a 60-day period of time. Right. So if you've got a doctor's opinion 60 days after the will was changed, that will is probably not valid. I'm not a lawyer, but I'm right. I believe you. Okay. So I would spend my money on that angle.

And really what I would do, uh, truthfully is I would just sit down with your aunt and say, what you did was wrong. And you know, it was wrong because granny was not of sound mind. And this will is not going to stand, uh,

So instead of us fighting about this in court, why don't you do the right thing and let's redraft all of this and come to an agreement that the family is going to have even disbursement of this instead of you stealing this from your siblings. Because I'm not going to allow you to steal it from my mom and dad. I'm going to sue you. So we need to work this out without the lawyers because the lawyers are going to get it all if we use them. I would just sit down and confront them. And it's not worth a lawyer for it.

The property's not valuable? The land itself is worth about $50,000 to $70,000, and the house is worth what a scrapyard would pay for the aluminum. Okay. So why do you care? It's where we spent every Christmas when I was growing up. It's where I learned how to fish with my grandpa, who's been gone for about 20 years now. And I'd like to keep it as a holiday home for my family and maybe even live there when my wife and I are up there in years.

I'm sorry that your aunt is a twerp and is messing with the family's memories, and I'm sorry that it breaks the little boy that lives inside of his heart. I'm going to tell you, having been in these situations myself many times in the last 63 years, just let it go. Forget it. Just forget it and move on. It ain't worth it. Go get you some memories with your babies. Go get you some memories with your buddies.

and the couples that you all love and spend time with them and build a new set somewhere else. That's what your grandpa did originally, and he didn't do all this for you all to fight. Just let it go. That's what I would do. It's hard for me to do that. Which is hard because it's not justice. It's not justice. It's hard for me to do that because I'm a hillbilly, and I'd rather fight you than not. But it's not working. Yeah, yeah. Just turn it loose. If it was a million five or something, we can argue about it, but I don't.

for for fifty thousand dollars right right he's right he's gonna spend all his money on lawyer and the other thing man it's gonna these people are living rent free in your head for the next three years while you're in court dealing with this you're getting you have tenants that took up residence between your ears you know yes because it becomes all consuming and it's all you can think about and it's not worth it's not worth 50 grand just let it go i know you were hurt and i know she's wrong and rachel's right it's just it's not justice

Yeah. It's not justice. But for your well-being, Paul. It's just wise. To move on and live your life. Yeah. Yeah. Spend the money and the headspace that you would have spent on this, setting up a new deal and a new legacy that will cause your grandfather to be in heaven smiling at you. Spend your time on that, man. This is The Ramsey Show.

This show is sponsored by BetterHelp. Hey good folks, the back-to-school madness is upon us. It's hitting us right now. We got travel and work and all these forms to fill out now and sports to travel to and on and on. My family's schedule is so packed and we haven't even begun talking about things like exercise and date nights and counseling and church and home projects. And those are the things that make our life even worth living.

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Well, we're doing something that we haven't done in a while, and I'm really excited about it. It's actually that we've never done it exactly this way. We used to do a day-long event called the Total Money Makeover event 1,000 years ago. Rachel was a teenager even, and we'd get up and talk about kids' books, and we had like 5,000, 10,000 people in these arenas around, and we would do that in those days. We built this conference center here at Ramsey that holds about 2,500, and we are going to fill it up.

with a total money makeover weekend, May 10th and 11th.

Now, there's millions of you out there who have been listening to the show, and this is the thing where you get to come to Nashville, you hang out with us Friday evening, all day Saturday, and it's all the Ramsey personalities are going to be talking. We're going to walk you through every little detail of this financial plan and show you how to win. And we're going to do lots of Q&As, regardless of what baby step you're on. This is going to be an all-encompassing immersion experience. Yeah.

And, I mean, we're going to have lots of signings and lots of Q&As all through the day. We'll do Smart Money Happy Hour is one of the things we do Friday night. I'm going to talk Friday night when you get here. You can come in early and watch the show on Friday afternoon here at the main campus or the main building on the campus. And we would just love to have you. Now, we've sold most of the tickets already. It went on sale and it sold really, really fast, which is exciting.

And so we want you to come. Don't wait to get your tickets. There's some Platinum Plus tickets, just a couple of those left. Early bird pricing ends this Thursday. If you want to come to this May 10 and 11, go ahead and get your tickets. It's going to save you over $100 to get them early.

by Thursday. Again, it's just right here around the corner in May, May 10 and 11, and we want you to come. The whole campus is going to be booming with people just like you that want to win. Get your tickets at ramseysolutions.com slash events. Curtis is in Pennsylvania. Hi, Curtis. Welcome to the Ramsey Show. Hi, Dave. Hi, Rachel. Thanks for taking my call today. Sure. What's up?

So my wife is 23 weeks pregnant with our second daughter. During this pregnancy, she was unexpectedly pregnant.

diagnosed with colon cancer and we've begun treatment for that. Oh my gosh. I'm sorry, Curtis. Yeah. We were in the middle of paying off her, trying to pay off her student loans. We got from about $160,000 down to about $60,000. And my question today is, would you recommend that we continue to still try to pay down her student loans as we begin her treatment? No. No.

Okay. Stop everything. Pile up cash. Have a baby. Fight cancer. Win. Okay. It's your sole goal right now. You got one goal. Two goals. Have a baby. Fight cancer and win. Once you get that in your rearview mirror, it'll be nothing to pay off some student loan debt. Okay. How old is your wife, you said? She's 30. Okay. What stage is this? Stage four. So what are they telling you prognosis-wise? Um...

We have to start treatment right away, and we have to see how her first few rounds of treatment go and see what her response is and go from there. Okay. All right. You've got the hardest fight of your life on your hands, brother.

And student loans are nothing compared to this. Yeah. You go fight this. You get on your knees. You pray. Get all your friends praying. We'll be praying for you guys. And you just get in there and you fight and fight and fight and fight and fight. And take care of your wife and you take care of your baby. There'll be time to do the student loans later. But you need every ounce of focus and energy and money that you have to win this battle first. Yeah.

Okay. All right. Yes. And then I'll just give you another piece of information so it's in your brain, even though it's pretty cold for me to do this. But I'll just tell you, when someone passes away, their student loan debt goes with them. It's completely forgiven. So if she ends up in heaven with this, okay, there is no student loan anyway.

So we fight. We fight the cancer. We go win. Okay. Okay. And I didn't say that because that's the prognosis. I don't know. I'm not a doctor. I'm just listening to what you're telling me. Okay. And I know when you're facing these things that sometimes facts are helpful. That's why I gave you a cold fact. Okay.

Okay. Not because I don't care about you. So, but anyway, I want you to go in and if you were, let me just tell you, I'll just, this is an expanded version of what we tell people anyway. We tell people just when they're pregnant, period, stop, put a push pause on your total money makeover baby steps and pile up cash until baby comes and mommy and baby are okay. And then push play and use the big old pile of cash to pay and catch back up what you would have paid anyway.

And that gives you an extra big slush fund when there's a pregnancy. We tell people to do that anyway. And this is like 10x that, right? Yes. Okay. So you need a big old pile of cash for cancer and babies. Because we want babies, we don't want cancer. And we're going to win both of these. Okay. Oh, my goodness, son. Hey, and listen, you hold on and I'm going to have our team pick up. We're going to hook you up with one of our financial coaches in the area.

for free and they're going to walk with you on the financial stuff and help you any way we can so that you can completely focus on babies and beating cancer, not on money stuff. Okay. Thanks, Dave. I appreciate it. Amen. I'm so sorry. Go, go beat this and let us know. Okay. Okay. All right. We'll do. Thanks a lot. Just in case you thought you had a problem today. Yeah. Just in case. Oh, wow.

Okay, Trinity is in Colorado Springs. Hi, Trinity. What's up? Hi. Hi. How can we help? So I was calling to get your guys' advice. So a little bit over a year ago, I had a work injury, and I ended up just getting a settlement for a little less than $80,000. And so after putting everything aside for my medical work and everything like that,

I have about 60,000 left and I was just calling in to see if you guys could kind of help guide me of what you think a good idea of where I should put that money towards would be. Oh man, Trinity, are you okay? I'm getting better, but... Okay. Where are you financially today? Do you have debts? Do you have savings besides the settlement? No, I don't have any debt. I have...

- Completely own my car. There will be, sorry, I forgot to take out, about 12,000 of that would be set aside for my emergency fund. - Okay. - So it would be about 48,000 left over, I guess, technically. But aside from that, I don't have any debt, nothing like that. And then all of my monthly payments are paid through my monthly income. - Okay. Do you own a home? - No, I don't. I'm 22. - Okay.

Or is that something that you're looking into? Do you think you'll be in your area for a while now? Yeah, I'm hoping so. I'm also studying right now to get my real estate exam or my real estate license. Okay. So I think that as well will kind of play a factor into when I'm ready to buy a home. Yeah. Do you have any retirement right now?

I do. I just started. I only have about $1,000 in retirement right now, but that was something I figured you guys were going to mention was like maxing out a Roth IRA or something. Yeah, I would go ahead and do that. I would go ahead and just max it out. And then I would probably put the rest, Trinity, just in a high yield savings and let it just kind of

sit there for a year or two. I mean, it's 5% return right now on most of them, which is great for just short-term savings. And hopefully here in the next year or two, you'll be settled down in a new career.

a city that you know you'll be long term and then I would use that money for a down payment on a house is what I would do but I would just put it in a high yield savings account right now and go ahead and fund your Roth IRA go ahead and max it out this year yeah set your medical aside your emergency fund your Roth IRA and the rest are saved towards your next house or your first house this is the Ramsey Show

Rachel Cruz, Ramsey Personality, is my co-host today on the debt-free stage in the lobby of Ramsey Solutions. Chadner and Sydney are with us. Hey, guys, how are you? Good. Doing great. Welcome. Where do y'all live?

Bardstown, Kentucky. It's about a 30-minute drive south of Louisville. No, exactly where it is. It's the king of Bourbon Town. It is. Good stuff. Good stuff. All right. Welcome to Nashville. And how much debt have you guys paid off? $67,533.01. I love it. Nice. I love it. And how long did that take?

22 months. Wow. And your range of income during that two years? We started making, it was at $64,000 and ended a little over $84,000. Good for you. Nice. Well done. Well done. I love it. Well, congratulations, you guys. What kind of debt was this? It was our house. Oh! Wow. Tiny little mortgage. Good for you. We're weird people.

I love it. You are officially weird. That's right. I love it. How old are you two? I'm 30. And I'm 29. What's the house worth? I'd say about $240,000. Goodness. That's amazing. That's amazing. Well done, you guys. Thank you. Well done. I love it. Congratulations. Very proud of you. Good work. Good work.

So what do y'all do for a living? I'm a homemaker, so I stay home with her daughter. And I'm an IT director for a Catholic nonprofit. Very good. Good for you guys. Very cool. And they just showed us a picture on YouTube, the house with the snow in the front and everything. It looks like a great place. How many acres have you got with that? It's only one acre. It's in a subdivision, but you wouldn't believe it just from that picture. It looks like it's on a farm. Yeah. It looks big. Well, that's nice, man. Very fun.

So what set you guys out on this journey 22 months ago following this Ramsey stuff? Well, we first encountered Ramsey, I did back in 2015 and took FPU. One of my friends shared one of your videos on social media. I'm like, well, this guy seems to know what's going on. And took FPU, met Sidney in 2017. And we went through FPU afterwards and got engaged, got married, and...

And when I actually started this particular journey on the mortgage payoff, my employer did an assessment of salaries and saw they were not paying us market rate. So we got a substantial raise. Oh, wow. And it was just the weight of it was us. We want to make sure we do something good with this. We want to be wise with this money. There was a pretty heavy pause going like, this is a lot of money. Mm-hmm.

You need to be careful or else it'll just disappear. Yeah, that's wisdom. We sat down one night and Sidney said, why don't we calculate what it would take to pay off the house? Okay. So I punched it into the calculator and I'm like, well, it looks like three years. She said, oh, we can do better than that.

than that 22 months later yeah well we originally calculated i think after we like just cut things out that weren't necessary i think it was like may of 2024 and as things kept going on we kept cutting kept uh doing we did some extra side jobs and um we paid it off oh my gosh you guys that's what happens when you use financial peace university is your pre-marriage counseling yeah

Way to go, you two. It's funny. I had taken FPU on my own, or so I thought. I thought I had only gotten two classes in. So we met. I was like, yeah, I've taken FPU. Looked back at the book. Oops, I only went to two classes. Let's do that together.

Oops. I'm an FPU dropout. Not anymore, though. You went back and got your GED. It's okay. Well done. And you got a paid four house and you're not 30. So that's pretty stinking cool. That's called graduate level work there. Good stuff. So this is one part of debt that we tell people like, hey, this is something that I promise once it happens and you don't have a mortgage payment, you're going to have to pay

the feeling it is it's the ultimate freedom it is that final final baby step would you say that that's true how has it felt for you guys there's a lot of security in it yeah yeah just you're you're right the grass does feel different under your feet and we paid it off course in december so yeah and i haven't seen the grass yet no not quite but uh but yeah it's it's phenomenal feeling yeah well there's just no debt in the world i mean what are you gonna do now to celebrate

Well, we came here. Okay. Now let's do something big. Well, we're really wanting to save up and build a nice garage. Okay. So that's been a big dream. Two-car garage. We're going to build him an office in the back of it. Some room for me. I don't know what it'll be yet, but...

So that's, that's the next big goal we want to achieve. I love it. Well, way to go, you guys. Congratulations. So do you have people cheering you on while you're doing this or do anybody know you were doing it or big secret or we did, um, we, we told family and friends, our family thought we were, uh, we're nuts at first. Um, but, uh,

Gotta give a big shout out to Sydney's parents. They were huge supporters. As well as our church friends, Austin and Andrea. They were huge cheerleaders for us. I think they're currently working on their payoff right now. Very good. And one thing we wanted to just mention is

We did have some adversity through these 22 months. We lost my father to suicide in September of 22. Oh, I'm sorry. The emergency fund just gives you so much, I guess, peace in that we were able to pay for the unexpected expenses and counseling and everything.

All the things that come with that. Yeah. And it just, it shook us and it made us actually, we're like, are we sure? And we're like, yeah. It just reinforced us more about why we want to live a life of freedom. Right.

My goodness. December 22. So COVID related, I assume. It was September of 22. And no, it was a suicide. No, I'm saying his suicide. Was it related to the COVID issues or? No, there was a lot more going on. And a lot of it we didn't know or see. Sure. I'm so sorry, you guys. Yeah, it's awful.

Awful to go through. Yeah, you're right. Adversity is always mixed into the story. Yeah. It's not just some kind. It's not just all some kind of flavor. Right. It's always in there. Yeah. Well,

Well, way to go, y'all. I'm proud of you for persevering, pushing out, and 100% debt-free, house worth a couple hundred thousand dollars, $300,000. That's incredible. And you're 30 years old. You're going to be so wealthy. It's going to be unbelievable, man. That's the plan. You're going to be able to be unbelievably generous in what you can do with your little girl. So bring your little girl up. What's her name and age? Caroline. She's two and a half.

And we have a second on the way. Oh, congratulations. All right. Caroline's a big sister.

All right. Well, we've got the every dollar gift card for you for a year subscription, one for you guys and one for you to give away as our way of saying thanks and coming and doing your debt-free scream. And enjoy that. Stay on that budget and keep things moving towards that incredible wealth. I'm so proud of y'all. Very, very, very well done. Thank you so much. Before I let you go, what do you tell people the key to getting out of debt is?

Just being on the same page, communicating. The budget was a huge help. We're avid every dollar users. Ah, so this will work. Good. You can just apply this and not have to pay us. But yes, just being on the same page. I mean, just the encouragement without...

Sydney constantly encouraging us. I couldn't have done it alone. So great. Very good. Chandler, Sydney, and Caroline from Bardstown, Kentucky. $68,000 paid off on their $253,000 home. Did it in 22 months, making $64,000 to $84,000. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free!

Yeah! Woo-hoo-hoo-hoo! Oh my goodness. So great. Oh, house and everything. You know, I...

I'm so proud of a couple like that. And they're sitting in a very affordable market, obviously. They got a very nice home for $300,000 there. They chose a home that they could afford and that they could pay off instead of choosing one. They could qualify with their income easily for twice that or more. They chose to be reasonable and then get it paid off. Now, at 30 years old, 100% paid off, they'll be able to do anything.

That's different than I'm on TikTok whining and saying, well, boomers bought their house for two black buckets of strawberries. And so, and you can't buy a house now because I'm stuck and I'm a millennial. Well, that's a millennial. They did. Who's on their way to being a millionaire. Yep, that's right. So there's your two buckets of strawberries. This is The Ramsey Show.

Rachel Cruz, Ramsey Personality, is my co-host today. Thank you for joining us. Open phones at 888-825-5225. Kevin is in Colorado Springs. Hi, Kevin. Welcome to the Ramsey Show. Hey, Rachel. How are you guys doing? Better than we deserve. What's up in your world? Oh, just stressed but not depressed. There you go.

I'll get right to it. So, I've got a bad credit card debt from Wells Fargo that closed a year ago. I put it to the back of my baby step two, figuring I could get to it, either settle it, pay it off completely, whatever needed to be done. Friday, I got served with papers. They are now suing me for the outstanding debt, bad debt, that I owe the money on.

I'm a little freaked out because I kind of figured, you know, it goes to like a collections company where I could maybe sell it for less or have a little bit more time. What's the balance? A little under $12,000 after interest and all that. On the lawsuit, how long has it been since you paid them? The last payment that they got from me was,

November of 22. It was a really rough month. It's the first time I've ever missed a payment. So November of 22, so you're 18 months behind. Roughly. And why have you not paid anything in 18 months? They closed the account. But they'll take payment. Oh, did not know that. I mean, you didn't think they were not going to take payment.

You knew they wanted to be paid, right? Yes, I know they wanted to be paid. I just didn't have a way to pay it through the app, and I didn't really think anything of it, being perfectly honest. Now you are. Okay. Yeah. So on the lawsuit papers, does it say Wells Fargo? Yes. It doesn't say a debt formerly held by Wells Fargo.

It says Wells Fargo Bank. I don't have the paperwork in front of me right now, so I can't read everything. Go check it because it's unusual for Wells Fargo to do this. They usually will sell off the bad credit card debt, and the buyer of the bad debt will sue you. That's kind of what I figured. That's what usually happens. So this is an unusual case. I mean, they're not above suing you for $12,000 if you owe them and hadn't bothered to pay them for 18 months. That's very possible. What do you make?

Between me and my wife, we make this past year roughly $130,000 to $140,000. Okay. Do you have any money? No. We're working on paying off debt. We actually just barely got started on the plan by getting serious a couple months ago. You don't have $1,000? You don't have $2,000? You don't have anything?

We have emergency fund plus a little bit in sinking funds for, you know, like vehicle repairs and stuff like that, but nothing serious. So the $1,000 starter emergency fund plus a few hundred? Give or take, yeah. Okay. All right. I assume your credit's trashed. It's about $650 to $670, somewhere in there. It's not completely destroyed, but...

We had a house fire two years ago, and then because of that, everything fell apart. A whole bunch of carts closed on me at the same time that I wasn't using anyway, so I didn't care. And the credit's slowly been building back up, so it's gotten a little bit better. Okay, so you have other things that are outstanding that are unpaid as well?

Yes, I currently have a little over $1,000 on another credit card through a credit union, a vehicle loan for $11,200 through that same credit union, and a personal loan through that same credit union for $22,500. And you're current with all of those? I am current with all of them. I'm actually working on the credit card right now.

Okay. Do you have any other credit cards or anything that you have not paid on in 18 months like this one? No. Everything else is either paid up or closed. Okay. Last time you told me one was closed, it had an outstanding balance of $12,000. Have you got another one of those? No. I checked every single one of those. So closed means you have a zero balance. Yeah. Closed means zero balance or I no longer have credit available to them. Okay.

They just stopped using the card because... That's what I'm talking about, man. How much other crap like this have you got out there that you owe money is getting ready to sue you? This one was laying out there. You had no available. They had closed it, but they still thought you owed them $12,000 because you do. Do you have another one of those? Yes. No. You just told me you did.

No, no, no, no, no, no. The Wells Fargo card is the only one that was out there like that. Do you owe money to anyone else that you're not current on the payments? No. Okay, so the credit cards that are closed have zero balance. The other credit cards that are closed have zero balances, nothing owed. Yes, sir. Okay. All right. Because I don't want some other monster to jump out of the closet while we're fighting this one. That's what I was trying to help you with, okay?

So here's what will happen. You will be sued on the date that they told you. Whether you show up to court or not, you will lose because the lawsuit is not about anything except do you owe the money? And the answer is yes. Have you paid the payment properly? The answer is no.

Lawsuit over judgment, $12,000, Wells Fargo versus Kevin in Colorado. Okay? So you're going to lose the lawsuit. There's no defense for not paying except paying. Okay? So it's not anything to panic about, but that's just what's going to happen. So this is going to go from a credit card debt to a judgment lien. It's going to convert to that because you're getting ready to get a judgment on you. And they won't do anything with it

for probably ever, but eventually they might garnish your wages or take a lien on a bank account, but it takes them usually six months minimum, but an absolute minimum of 30 days in any state to do that. So what's the court date? There isn't one yet. On the paperwork, there's no court date, there's no case number, anything. Then you've not been sued. That's why I'm joking. Okay. Okay.

Now, if you've been sued, there's a court date and it gives you the court, the circuit court, sixth circuit court or whatever it is you've been sued in. OK, this is a this is a notice. They served you to scare the pants off of you, which is good because it woke you up. You needed to be woke up. So now we can deal with it. So call them. You can call the law firm that's on it. Is there a law firm listed on it?

Yes, there is. That was actually going to be the question is me and my wife disagreed about that because I don't trust their lawyer because he's not my lawyer. Well, they don't trust you. You haven't paid the bill. So this is mutual. Fair enough. Yeah, just call them up and say, I don't have $12,000 right now.

I'm behind on everything. I think I might be bankrupt. I don't know, but I sure can't be sued and garnished by you guys. So what can I do to settle this? What would you take? I think I can scrape together a few thousand, and I can probably do that and give them a date that's about a month and a half out, and then you stop paying everything and you come up with $2,000 or $3,000 and offer them $2,000 or $3,000, $3,000 as settlement in full.

A month from now. Okay. Or $6,000 a settlement in full two months from now. Okay. Eventually, if you keep barking at them, they'll take a deal. Okay. And you have to come up with a lump sum cash. Do not cut a deal for payments. Don't do that.

Just say, I can't pay this. The only thing I can do, I can't pay payments. I can't stand any more payments. I'm trying to stay out of bankruptcy. And if I can settle this with you, maybe I can. And keep talking to them that way over and over and over until you come up with a number. When you come up with a number, listen to these two things quickly. Do not give them electronic access to your checking account. They will clean you out. And do not give them a dime until you have whatever deal you have made in writing.

Over the phone is not good enough. They lie. Get it in writing and no electronic access to your checking account and settle this for $5,000 or $6,000 and make it go away. Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships.

Rachel Cruz, Ramsey personality, number one best-selling author, co-host of the Smart Money Happy Hour with our one and only George Campbell, and my daughter. She's my co-host today. The phone number is 888-825-5225. Lisa is with us in Irvine, California. Hi, Lisa. Welcome to the Ramsey Show. Hi. Thank you. So excited to speak with the both of you. I'm a long-time listener and follower of the show. Thank you.

I'm calling to get some advice on talking to my close friend. She told me that she has added her toddler, who's two years old, as an authorized user on her credit card. I almost fell out of my chair when she told me that because, like I said, I'm a longtime listener and I know this is a very bad idea. So I'm calling to ask what advice should I give to her or is it even my business to share my opinion with her?

Has she asked your opinion? No, she was trying to get me to add my kids as authorized users. She told me, you should do the same thing. And I kind of froze. To build a kid's credit score. People are doing this now. Yes, to build a kid, yes. It's a TikTok trend. Oh, God. Yeah. Yeah, it's a whole thing. You put your kid as an authorized user, you build their credit. The level of stupidity is painful.

It just really is. I mean, TikTok. My God, y'all. I mean, it's not just TikTok. I know, but that's just completely asinine. So because here's now what you've done, okay? You've opened Little Junior up to like 73,000 possibilities of Russian hackers completely stealing his identity. And if Little Junior stays off the dadgum grid, then Russian hackers aren't going to steal his identity.

So keep Junior off the grid. Oh, my God. It's been a conspiracy theory. It's not a conspiracy. It's a fact. You sound like a conspiracy theorist. It's not a conspiracy theory. I mean, identity theft happens to people all the time, but not if their idiot parents don't put them on a credit card. Oh, my God. I don't know. I don't know how to help people that dumb. What?

it's just you well she yeah i mean golly as her friends lisa i don't think that there's anything you do no she didn't ask you and she's not gonna do anything you say no just say listen if she says it to you again just say i wouldn't want to expose my child to the level of identity theft that you've exposed your child to the probability of identity theft went up 10 000 x okay

This kid has a social security number and is nowhere else on the grid until you do this. And now you dropped them in the dadgum internet. I mean, you're asking for it. You're pointing a gun at the face of their credit report. Oh my gosh. At the face of their credit report. Okay. Well, and... I mean, it's ridiculous. You're asking for it. And the hard thing that happens too, which Lisa, you probably know this too, because not just the identity theft...

But then things happen in life, right? And parents get behind on their bill. And then they end up trashing the kid's credit score. And it does the opposite effect of what their intentions were because they weren't spending well. Technically, a user should not get the credit of the owner anyway. I think that's what they're doing in the first place, though. I know, but technically an approved user on the card should not be affected by the credit of the card.

positive or negative, technically, because they're not on the account. They're just allowed to use the account. So it should not show up. If it does, FICO is screwed up because they're not an owner on the account. They're just an authorized user. But I feel like that's why parents are doing that, though. You're an authorized signer on Ramsey Solutions' website.

checking accounts because you are one of the owners of this company but if the account goes sideways the fact that you're an authorized user does not affect you but just because you're allowed all it means is you're allowed to sign it doesn't mean you own it so then lisa what what's her purpose of doing it because she's an idiot no stop but why what was she saying

To build credit. It won't build her credit. It shouldn't build her credit. As an authorized user. It's not supposed to. Sometimes it gets reported that way falsely, but it should not happen because you're not liable on the account if you're an authorized user.

It's not legal. Yeah, I hear you. It's legally wrong. Can it happen? Yes, it can happen. But here's the thing. If you want to build credit for your toddler to start with, A, that's dumb. B, because you're setting them up for a life of debt. Yeah. This is your plan. I want my child to use credit cards and be in debt the rest of their life. What kind of horrible parent are you? Yeah, a good credit. The primary credit cards, yeah. The good credit management helps them improve your credit worthiness. It says what? An article on TikTok? Google. Okay.

Okay, there you go. I'm telling you, it's a legal issue. People are doing it though. Only the people that are liable on the account. And you authorize users not liable on the account. Okay, we have 116 debit cards. No, I hear you. I hear you. But that's debit cards. It's credit card different. It's credit cards different though. No, it's...

Because debit cards, you don't have a credit score with a debit card. The owner of the account, not the authorized user, is responsible for the credit, good or bad, and that's supposed to be what's reported. It's not always. Yeah. So to their point, they may actually screw up their kid's credit. It's possible. Yeah. Or enhance their kid's credit. It's possible. But it's a really dumb idea because you're just asking for identity theft. You're begging for it because you put their kid. Because here's the thing.

Who goes back and checks a four-year-old's credit twice a year to make sure that they've not had their account scarfed? But you put their name out there and you don't go back and check on it. And you coast along thinking you're a freaking genius because you watch the TikTok video. And now you've exposed your kid's credit to being completely ripped. And you could look up and there'd be five or six cards open in their name and you wouldn't even know it.

Because they're not required to identify you or to notify you about your kid. They don't check on it. Your kid's not going to get anything in the mail. That's how identity theft works. So, oh, God. Oh, that's so aggravating. So, I don't know. I mean, the overall answer to your question, honey, is this. If somebody isn't asking you their opinion, your opinion, then don't give it. I mean, I've got friends that do stupid stuff, too. So...

They're still my friend, but they're still just my stupid friend. And so that's okay that you got friends that do that. They do things you don't agree with. I mean, I have people I love that don't know how to vote and it's all that kind of stuff. I still, still love them, but they vote wrong. And so, you know, there's, you just, there, you have some of that, right? But don't, don't ask me. Yeah.

how what i think unless you want me to tell you that's right friend or on the air sure and the problem is when you call on the air you've automatically asked so it's like our job to tell you what we think so it's what we do here for three hours every day so oh god that's poor woman uh so lisa i'm sorry you can't help her she's not gonna even if you gave her your opinion

She's not going to do anything with it because she's got her little brain made up. Her system going. She's just going to screw up her kid's life. Oh, God. This is The Ramsey Show. Rachel Cruz, Ramsey personality, is my co-host today. Linda's in Pittsburgh. Hi, Linda. Welcome to The Ramsey Show. Hi. How are you? Better than I deserve. What's up?

Hey, my husband and I are wondering how he can acquire his portion of the will that his mother wrote. So she passed away in 2006 and wrote a will giving the family home to her children. And his brother has lived in the house all of his life and still lives there.

Was the will probated? The will was probated by their stepdad in 2007. She passed away in 2006. Okay, and so the stepdad had nothing to do with the house and the will, right? Yes, it was just one of those where he had the right to occupy during his lifetime. The brother? Yes.

Or the stepdad? The stepdad. Okay, so he had a life estate, and the will left the property to your husband, his brother, and whatever other siblings. And a sister who... Okay, was the property retitled at that time? Did Pennsylvania probate require you all to retitle it and put everybody's name on it?

The house is in Colorado. Oh, okay. And at the time of probate, it was retitled to all three siblings. Okay, so you each own a third, undivided interest it's called, okay? Right? Uh-huh. Okay, is sister still alive? No, she lost her battle with depression in 2017. I'm sorry, I'm sorry. Yes. And did she have heirs?

No, she did not. Okay, so I would suppose that your husband and his brother are now equal owners then. You would have to seek an attorney's advice to be 100% sure, but let's play this through. That's what it sounds like. It sounds like they're now equal owners, okay? And he doesn't have to do anything to acquire it. It already has his name on it. The death of his sister left half of hers to him and half of it to his brother, and so now the two of them are 50-50.

Okay. His name's on the title. If the property were sold, he would get 50%. Okay. Okay. So now what are you all wanting to do?

So he had, after, it was almost two years after the stepfather passed away, he approached his brother about either buying him out or selling the home. And he said, absolutely not. I have no interest in selling the home, and I'm not going to buy you out. Okay. Who lives in it? His brother. Okay. He has lived in it all his life. Okay. So he's living there for free.

Yes. Okay. He has a roommate there that pays him rent. Okay. Well, here's the thing. If you want to stir it up and cause this to come to an end, because this is not a fair situation, this is unjust. Agreed? Agreed. Okay. Then your husband, does he have any relationship left with his brother at all?

Well, they love each other. It's just that there's this mountain in the middle. I didn't ask that. I asked if they had a relationship. What? I said they love each other. There's this mountain in the middle of the house. Yeah. Well, it depends on how much your husband wants to invest in this. But if we want to try to save the relationship, you get on an airplane and he flies out there and he sits down with his brother and he says, okay, you living here for free is done. I'm a 50% owner in this and you can't live here for free anymore.

You have to move out. I'm demanding that. Or we have to sell the house or you have to buy me out. Now you decide which one you want to do. You want to move out and we rent it and we split the rents that we'd collect. Or do you want to buy me out or whatever? I'll give you a deal if you want to buy me out. But you sitting here and me getting nothing and you living here for free ends. I'm done. I love you. I hate what you're doing to me. It's nasty and it's wrong and it's unjust.

And he says that to him in person to his face. Okay. And then if the brother goes, well, I'm not going to do that. You say, yes, you are. Because if you do not, I'm going to hire an attorney and I'm going to sue in circuit court to have this partnership disbanded. And the court is going to force the sale of the house to give me my half.

And it's going to cost me $5,000 or $10,000, and you're probably never going to speak to me again, but I'm at the point that I'm tired of you screwing me over. This is how you have to handle it if you're going to handle it. Otherwise, you just got to accept it and go on. And then you have to hire an attorney, and the judge will demand that you sell the house to liquidate the estate. And they'll sell the house, and the brother will get half the money, and you'll get half the money. Do what?

I said liquidating the estate is selling the house, correct? Yeah, you sell the house. Okay. Sell the house and you get your half. Now, or we can have the house appraised and at 80%, 80 cents on the dollar of the appraisal, I'll take my half. I'll give you a 20% discount if you want to buy me out. How much is the house worth, Linda? From what we can tell, it's probably right around $400,000. Yeah, this is just wrong.

And your brother-in-law's a leech. He's a parasite. Mm-hmm. And you're tired of it. That's why you called. Mm-hmm. Is your husband as tired of it as you are, or is he just going to let this go on? Oh, no. He's as tired of it as I am. Okay. He's just a super nice guy. Okay. If he wants to try to be super kind to his brother, he can fly out there and try to do this very calmly and just say, this is over.

Okay. You're going to buy me out or the judge is going to force the sale of the house because when I leave this conversation, if we're not in agreement, I'm going to contact an attorney and we're going to court and the house is going to be sold because you living here for free is not right. And it's not fair. You've been taking advantage of me and I can't let you do that anymore. Even though I love you, that's wrong. And, and if brothers, and if you want to buy me out, I'll give you a discount on the appraisal.

But I own 50%, you own 50%, and you can't live here free anymore. That's over. Fly it, take a plane ticket, invest a plane ticket into the relationship, try to do it nice, and see if you can get him to move off. He may just think that my brother's a nice guy, he's never going to do anything. And he might be right, talking about your husband, right? Yes, I know, I know. He sees your husband as a target, and he's using it.

He thinks your husband's not going to do anything. Yeah. And so if your husband doesn't want to do anything, it's okay. I don't care if you want to just let this go on. I'm not mad about it. It doesn't matter. But if you're going to do it, that's how you do it. I would sell it to him at a discount. Because if you sell it, you're going to pay expenses anyway. Right? Right. And so...

If it's worth $400,000, I'll sell you my $200,000 at 80%, which is $160,000. That's a great deal. You have 30 days to get me my money. If you do not get me my money in 30 days, I am going to begin a court proceeding that's going to force the sale of the house. And that's the end of the discussion, and then just go hire a lawyer and do it. And it'll take a dadgum year, and it'll be $10,000 out of your pocket in legal fees.

Is there a way to find a reputable attorney in Colorado? Sure. That was our other thing. It's like, how do you find one there without... Call one of our real estate endorsed local providers. Jump on the line at Ramsey and find the real estate endorsed local providers. Tell them you need a good real estate attorney. Okay. And they'll give you a recommendation.

And that's the only way. I mean, you've got to have somebody that you trust. And these are high-octane real estate agents that we endorse. And they'll know somebody that's a quality attorney that can litigate this. But I really wouldn't, you know. It may be that when you hire the attorney and you spend $500 and he decides to send a letter to the brother, that that wakes the brother up and then the brother does it. Because the brother's probably, he's been living this way a long time. He's probably not going to take the first step.

He's not going to believe your husband that he's going to do anything because he's never done anything. So he's suddenly a man of action? That's going to be shocking to the brother. This is The Ramsey Show.

In the lobby of Ramsey Solutions on the debt-free stage, Ryan and Kendall are with us. Hey, guys, how are you? Howdy. Doing great. Where do you guys live? San Antonio, Texas. Ah, cool. Nice. Welcome to Tennessee. Good to have you. I heard howdy, and I thought, Texas? They're not from Minnesota. That's good. Minnesota. Good to have you guys. Thank you very much. It's good to be here. How much debt have you paid off?

$116,942.55. I love it. How long did this take? 54 months. Way to go. And your range of income during that time? So we started off with $65,000. That was my pay. And this last year we finished up at $172,000. Very nice. What do you all do for a living?

So I'm an occupational therapist. And I do sales. Ah, very good. Awesome. Okay, so occupational therapist. I'm guessing the 117 might have had some student loan in it.

Yes, it definitely did. What was the breakdown of the $117,000? Oh, goodness. So the car payment was, well, the car loan was around $27,000 and the rest of it was student loans. And ironically, it was all my student loans. Oh! I blamed it on her. I'm so sorry. Nope. I stand corrected. That was a part of our journey. We...

had most of this loans when I graduated from college when we first married about five years ago and the idea that was that we had to stop the bleeding and start living a debt-free life and progress in that direction and taking out loans for her master's program wasn't part of that plan so that was one of the things that we actually cash flowed through oh you cash flowed your occupational therapy wow y'all that's huge wow that's impressive while you did this really yeah correct

You've been married about five years, you said. About 60 months. Yes, sir. And 54 of it, we've been doing this. Correct. Wow. So you got married and you looked at this pile of student loan debt and you got these goals to be an occupational therapist. All these things are in conflict with each other. You sit down. Tell me how all this happened. How did you get connected to Ramsey? What did you decide to do all this? So I decided to pursue occupational therapy degree in El Paso right after he had gotten offered a job in San Antonio. So...

We made the hard decision. He decided to keep his job because we saw great growth there and stay in San Antonio. We did long distance for me in El Paso. And that's quite the drive. So Ryan, on the way up one time, he decided to turn on your podcast on Spotify.

And it's a couple of episodes to get to El Paso. That was my daily, that was my monthly. You can listen to a week's worth. So we started listening to it back in 2018 and man, there's not a lot of cell reception out there. So

I'd have to download them and listen to them along the drive. And before you know it, in El Paso, after seven hours, and hey, Kendall, I got this great idea. I got a bunch of great ideas. Listen to this. Tell me what you would do. And having those back and forth conversations, pressing the pause button and saying, well, what do you think is the right answer, Kendall? And having that discussion kind of turned us on to this whole entire idea that, you know, that is not a pet. It needs to go away. And that's a type of lifestyle that we want to live one day. Wow.

That's amazing, you guys. Absolutely amazing. And then in the middle of it, had a baby. Yes. In the middle of all of it, right? It did go on pause. That's once or twice. Sweet. Oh my gosh. Okay. So what was the hardest part of this? Because you guys, you did a lot. You cash flowed school, got a different career. You guys were long distance together, baby, all of it. But

all of life and all of the money stuff, what would you tell someone is like, whoo, that was hard. That was the sack. We felt that one. Yeah. The, the hard part was saying no, quite frankly, to all those things that you really want to do, um, that you know you could do. Um, but having that delayed gratification and waiting and deciding, you know, my priorities are elsewhere. Um,

That was definitely very hard for, especially me. I have so many hobbies. It's so easy to spend money and to be committed and heading in the right direction for years. It's tough. Well, good. How long was the Masters? How long was the separation because of the Masters? About two and a half years.

Wow. That's brutal. Yeah. Yep. That's harsh. Okay. Wow. What was the thing that you guys would say to another couple listening that maybe may have similar story? Maybe not, but they're trying to get out of debt. Let's just be real clear. They didn't do that separation to get out of debt. They did that separation to get your occupational therapy master. Okay. And you did it and your cash floated, of course, but the separation was due to that. Not the separation, but I mean, being separate is a better way of saying it. Well,

was due to that right yeah no you know it's good good clarification the school you got into versus the job right that was that was the decision you guys made yeah man in my career in sales is very long term yeah ideas i'm gonna spend my whole life in san antonio which is a great idea to me because i love san antonio yeah um but to be jumping around from location location doesn't really give you the opportunity to build a backlog and build a relationship so a two-year

A two-year delay or two years of patience, really, versus the long-term career. Yeah. It's an adult decision you have to make and you have to commit to it. Totally. Absolutely. So what was the thing that you would tell somebody, here's what you have to do in order to get out of this much debt? Because this is a lot, you guys. I mean, this is six figures. So what would you say you have to do this? Our biggest two things were consistency towards our set goal.

and seeing that as the bigger picture and communication. So even if we wanted something that we knew we shouldn't get, we would still talk about it. Yeah. Man, this is going to be so cool to get later down the road. Not now, just not now. And same with the long distance. Really, it's the same two ideas. Consistency, communication, whatever, feelings good, bad,

all the in-betweens yes that's good so um you know it occurs to me that not only have you done this amazing 117 000 but you also cash flow this what did the masters cost oh goodness yeah you know that's a tough question to answer so i filled out probably

I have no idea how many scholarships and grants I filled out during that time. That was like pretty much my part-time job going to school. We also benefited a little bit from the COVID. Our loans were put on hold, the government ones. So we used that opportunity to not have to pay the minimums on those. And then I got a lot of opportunities.

grant opportunities through COVID to continue my education. It didn't cost a ton then, actual cash? No. I'd say it's probably a 50-50 breakdown. That's great. It was the back half of the last two semesters were mostly my income going and contributing to that. The first three semesters, I'd say, Kendall did a whole lot of the work, especially with

Scholarships and grants. It's great, you guys. Okay, so you put about $100 into that and about $117 into the other. Oh, $100, I don't know. You said half and half. About, yeah. Okay, all right. That's what I was thinking that. I'm thinking you really, the whole situation here, you really did about a $200,000 move.

Yeah. It's what I'm guessing. And I was thinking that because that's, you know, it's one thing to pay off 117. It's another to do it. Probably 50,000 for the half and half that you're saying. Yeah. But still 50,000. Oh, okay. It's still a lot. I see what you're saying. I see what you're saying. Okay. Wow. Way to go, y'all. Thank you. Great job. Who was cheering you on? Oh, gosh. Our entire family and friends. Of course, we still got funny looks every once in a while. Especially when we said no to like fun events and vacations. Yeah.

All those things. But they were still cheering us on. Great job, you guys. Was it worth it? Oh, yeah. Absolutely. It changes my decision making. You know, it gives me the opportunity to decide for myself what I want and what our family wants. Right. And it just clears your thought, clears your focus.

Good for you guys. Well done. All right. Let's bring up your baby. Are you going to have that in the debt-free screen? Yes, absolutely. And what's his name? Nolan. And how old is Nolan? He's 15 months. Oh, go big guy. Go big guy. They always like the microphone. They grab them. That's great. All right. Ryan and Kendall and Nolan, San Antonio, Texas, 117,000.

paid off in 54 months making 65 to 172 count it down let's hear a debt free scream 3 2 1 we're debt free yeah that's how it's done ladies and gentlemen

Man, those people are goal-oriented. With the baby. Oh, my gosh. They did a lot. Oh, they did a lot. It's amazing. A lot of sacrifice on so many levels. And they did it. That's it. It's the movement. It's the proactiveness of people that stand on this stage. And it's incredible. It's incredible. All of you listening. Heroes. Yeah. They're heroes. Well done, hero. This is The Ramsey Show.

Luke 637, do not judge and you will not be judged. Do not condemn and you will not be condemned. Forgive and you will be forgiven. John F. Kennedy said, forgive your enemies, but never forget their names. I guess that's fair. Oh, that's fun. Well, folks, if you've got questions about taxes, we get it. Taxes are confusing.

And to help you get a better handle on them, we get some questions from time to time for our listeners. I want to avoid overpaying taxes each month. What do I need to change with my paycheck? Well, let's correct one thing. It's not overpaying because you don't pay. It's overwithholding. See, withhold means I hold back. They're holding part of your check, withholding some of your check. They're not letting you have some of your check to apply to your taxes if you

don't need to pay the taxes. You get it back as a refund, meaning you have had too much taken out of your check, too much withheld. So you're not overpaying. You just haven't too much withheld. Now, once we say that, it's a simple couple of ways you can do it. The simplest way is if nothing has changed, if the tax code didn't change and your situation didn't change, you just simply divide it by 12 and say, I need that much

You have $3,000 refund. I got $250 a month too much coming out of my check. Go to HR and say, reduce my withholding by 250 bucks a month. And they can do payroll adjustment and do that real simple. But if things have changed, then you use tax software, like for instance, the Ramsey tax software, Ramsey solutions, tax software, and do your taxes, right?

But don't, you know, you're just running out the taxes to see what it is. What is your taxes going to be? And so then have that much, whatever your tax bill is going to be, have that much withheld from your check over the year. And so let's just pretend, let's say your taxes are $10,000. Well, that's $833 a month.

So you need to have that withheld from your check. And of course, either way, you've got to fill out a new W-4 with the HR or with payroll to get that done. So the trick is do not get a refund. If you get a refund, it means you've loaned the government your money at zero interest all year and they send it back to you in April with no interest. You have a stupid savings account.

That's what a tax refund is, a stupid savings account. So do not be setting yourself up for a refund. Well, if you're getting a refund, adjust your withholding because don't pay them so much. Don't let them take more than they need to take if you don't owe it.

Now, don't underwithhold where you have a big tax bill at the end of the year. That's going to get you penalized and create cash flow problems for you. But if you're getting $3,000 a year, $4,000 a year, $1,200 a year back every time, that's just, you've got a stupid. It's $1,000 or more. And you've got a Christmas account with the freaking federal government. No interest. Don't do that.

And Santa Claus doesn't live in D.C. This is not a gift from them. This is your money that you gave them and shouldn't have given them, and then they give it back and act like they did something. And you're like, oh, I got a refund. It's like you're smart. It's not smart. It's the opposite of smart. So don't do this, okay? Change your withholding with your W-4 by readjusting to the proper amount of tax coming out. Now, for more tax help, go to ramsaysolutions.com slash tax.

Tons of all kinds of blog stuff there to help you with taxes. And you'll find the Ramsey Smart Tax, which is our no-nonsense tax software. People are changing to it from the other one in droves. There's no upfront pricing, or it's low upfront pricing, I'm sorry. No hidden fees. And if you have a complicated situation, you can even go to one of our tax pros with Ramsey Trusted. They'll help you. So, RamseySolutions.com slash tax.

tax. Shannon is in Dallas. Hi, Shannon. Welcome to the Ramsey Show. Hi, thanks for having me. Sure, what's up? Okay, so my husband and I were new listeners, and we did the baby steps a little bit out of order. So we had some good home investment opportunities, and so we have our mortgage paid off.

We make about $180,000 a year before taxes. The only debt we do have is a car note, which is about $50,000 a year. So we've got six months emergency fund. I guess my main question is we have zero retirement. So I work part-time and my husband works for a small company, so they don't get any retirement through his job.

So our plan was to save up cash and put down on a rental property. But after listening to you guys, we think maybe we need to do the... Well, we need to pay off the car first, obviously. But then do 15% for retirement in a Roth. So I guess...

My question is we're almost 40. So in 20 years, will we have enough in retirement, which is 15%? Yeah. Have you run the calculations? I did. It was like 600,000, I think, but that's without percentage increases and stuff. Yeah. And that's if you could never get a raise.

Right. Right. And the other thing is this. If you're at your, you know, let's say you get the car paid off and you have an emergency fund. You told me your house was paid off, right? Yes. So you're a baby step seven. So 15% no longer applies. At that point, you can invest more. You would max everything that you've got available. Roths, 401ks. He doesn't have anything at work, though, and you don't have anything. So all you've got is Roth, right? Mm-hmm. There's no self-employed income anywhere, right? Right. Right.

Okay. How large is the company he works for? There's about 10 people. Okay. If I were him, I would sit down and talk with the owners and go, hey, guys, you can put this stuff together really inexpensively. Right. And coach them up. Have them sit down with one of the Ramsey SmartVestor pros, and you can start a retirement plan for a 10-person company, and it costs almost nothing.

Okay. Okay. So see if they'll start that. Cause they did just start health insurance. They didn't even have that before. Well, yeah, that's going to cost them in penalties under Obamacare if he doesn't do that. So they got to do that. But the, but yeah, they, they, yeah, it's really inexpensive and very easy to set up for a 10 person company. Have them get in touch with a smart investor rose. That'll help you put even more in. So here's what I would do. I would max out. Let's say that you could do,

I don't know, 20%, but you can't find enough stuff to put it in. So you max out the coup Roths. You put out whatever you can at the company. If they start doing something fun, you put something over there, and you still got more money. Then pile up that money to buy real estate for cash. Okay. And then you're going to end up with a net worth probably close to $5 million when you hit retirement.

Okay. If you do all that. With the Roth maxed out and then investing in. In real estate that you pay cash for and your increases in income and you just keep doing all this stuff for the next 25 years, you're going to end up between $3 and $5 million. Okay. That's where you'll be. The $600,000 is just simply doing a Roth and you're going to do more than that. Okay. Was that both of you guys? Was that two Roths, Shannon? Yeah.

Well, yeah, so I'm part-time. Okay. You can do a spousal, though. Yeah. You can fully fund both Roths. Yeah, y'all both need Roths. But that's only six grand. Yeah, and they can do what they can. Tell him this. Tell him to check with. Okay, you need to go to SmartVestor Pro anyway to sit down and set your Roths up. So go to RamseySolutions.com, click SmartVestor, and they'll help you get your Roths started. Okay? You have kids? Okay.

We do, and they're teenagers. One we just put through Fire Academy, so we pay for that. The other one, she's 17. Good, so we're cash-flowing that then at this stage. Right. Okay, then tell your husband to ask his boss to meet with your investment advisor, your Smart Investor Pro, and they can show him how to do, if you can remember this, it's called a simple IRA. Okay.

It's a 401k for small businesses and it costs almost nothing to set up. Okay. And then your husband can load that up and the other people will jump on board too, but he'll be able to do it. There's almost no regulation on it. It's a very, it's why they call it the simple IRA. It's a 401k for tiny businesses like this. It's perfect.

And so they can do all of that. And then you got more money beyond that that you can keep doing. So just pile up that cash because you don't have a house payment. You don't have anything, girl. You can have a great life and still pile up some money. And you're going to be able to pay cash for some real estate. The real estate is going to go up in value. Your home is going to go up in value. You're going to be in great shape.

Get the car paid off, though. Yeah, the first step is car paid off and the emergency fund. Absolutely. Very good. Great job, Shannon. That puts us out of the Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

Hey guys, I'm Rachel. And I'm George. And you've probably heard our voices before on The Ramsey Show. And do we have a surprise for you? Yep, we have our very own show, Smart Money Happy Hour, where we talk about pop culture, current events, and of course, money. George, it's a great show. And what else do we talk about? So much, Rachel. Not enough, and yet too much. We talk about guilt tipping, because tipping is out of control and I won't stand for it anymore, which is why I'm sitting. I'm glad you're taking such a stand. Hey, I'm Rachel.

And we also talk about something else I'm passionate about, Disney adults. Oh, George. Why is it a thing? Listen, some adults still find the magic. Sure.

We also talk about toxic money traits and girl math. And if you don't know what those are, you have to listen to the podcast. Yeah, there's a lot there, you guys. It's pretty fun. We keep you relevant is what I'm trying to say. We help you out. So pull up a chair to the happy hour you wish your friends were having. We promise you won't regret it. And if you don't have friends, we'll be your friends. We will. We're great friends. So make sure to check it out on Apple, Spotify, YouTube, or the Ramsey Network app.