No Amount of Debt Is Too Big for a Comeback
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This is the Ramsey Show. America thrilled to have you with us. This is where we help you win with your money, win in your work, and win in your relationships. The phone number to jump in is 888-825-5225. 888-825-5225 is the phone number. Alongside the incomparable, the fabulous Jade Warshaw, I am Ken Coleman, and we're here to coach you up today.

So we got those money questions. We got some work-related questions. Hey, I need some more income. I like helping people make Mo Money. Mo Money, Mo Money, Mo Money. And by the way, if you're at the Ramsey Show and we help you make Mo Money, it doesn't come with Mo problems. It better not. Not here. Yeah, we have the good kind of Mo Money. That's right. So let's get right to it. Josh is going to start us off in Augusta, Maine. Josh, how can we help today? So I've got a business.

a bit of a strange problem here. Perfect. Jade loves strange problems. I love weird problems. Perfect. It might not sound so strange once I explain it. I'm 25 years old. I own my own home. I built a construction company. I make about $130,000 a year. And I've got a real...

Proclivity for building my income, building my business, building my personal wealth over time. Great. And one of the things I'm really struggling with, and I'm looking for a non-biased opinion because you know how friends are. They're great, but you can only get so much. I'm looking for any sort of advice on how to select a partner who's not remotely interested in my position in life.

Are you talking about business partner or romantic partner? Romantic partner. Got you. Your position in life. I mean, at 25, I'm doing fairly well. Tell us what that means. What's your net worth? Net worth.

Like, are you saying if I, my business net worth or if I were to liquidate all of that? You don't have that much, my friend. You just can't answer that question. Listen, I appreciate where you're at, young man. You said you're 25 and you have a proclivity. Great word, by the way. Yeah, wonderful vocabulary. I'm a big fan of proclivity. Just used it twice there because I like the way it sounds. To make a lot of money and all this kind of stuff. No, we don't know that. You're 25. Right.

I appreciate your confidence, but if the question is, how do I make sure I find a girlfriend who's not into me for my position in life? I go, well, I don't know that I want to find a woman who's not interested in my position because that position in life, the way I'm hearing that is you got to provide. Position leads to provision, Jade. Come on. Okay, Ken, you're right. So, I mean, you're not in a place, my friend, where you're worried about gold diggers unless you're hanging out in the trailer park.

Are you dating women that are in poverty situations? I try not to, but they pop up. Okay, so listen. This is good. Listen, Joel, listen. If you are dating... I've got to be very careful how I say this, but I'm going to answer the question. Go for the gold, Ken. I've got you here to correct me, but...

Maybe I ought to say it. No, let me say it. I'm channeling Stacey right now to make sure my wife is right beside me and I'm thinking, what would Stacey want me to say? Because she's a good woman. If a woman who is in poverty pops up into your dating life, I don't have a problem with that.

People deserve dignity, and there's lots of great women and lovely women and lovely men who come from poverty. So I'm not saying cancel it out. However, if a person from poverty pops up in your dating life, as you begin to date them, you should have some discernment there to go,

Am I a ticket out? Yeah. And so you just have to have some extra judgment and discernment there. I wouldn't cancel them out. But at the same time, I wouldn't necessarily be hanging out in those areas either. So I'm trying to walk the fence there. I just think this is a problem he doesn't need to be worried about. I don't think it is a problem. I think it goes both ways. The same way you are...

All that stuff matters to your point, your station in life, your work ethic, what you're accomplishing. That's part of the resume, you know, the, the, the personal resume. And so the same way that you have built a personal resume that people will learn about as they get to meet you, you will learn about their personal resume as you meet them and learn about them. And you get to decide who gets the position based off of their personal resume. And so there's nothing wrong with that. You opened up the call talking about, um,

this was a strange or weird problem. And I don't think it's strange at all. I think it's just part of everyday life when you meet somebody and you get to decide, okay, is this person going to be somebody that I'm going to be friends with? Or is this person going to be somebody that I date long-term? Have you had a lady, you said that this has popped up a few times. So have you had someone that has come from extreme poverty that has dated you and you felt like they were only dating you because you were a meal ticket out? Yes, it's happened to me more than once.

How did you know? Tell us. Be very specific. How did you know? When did you know that she was only after you for your money? It happened a couple of months in, about three months in. I noticed at first she was very big on balance as far as our personal time and psychological investments.

you know, we're able to talk and work things and figure stuff out between us as people. Okay. But as time goes on, it turns more into what kind of life you can provide for me and my future children. And, and there's no reciprocation besides physical, which to me is, you know, it's got a value, but

I'm not sure. I'm not going to lie. I'm not sure I understand. And I want to understand. I agree. You're not being specific enough. There's part of it that I think it is part of the conversation. Maybe, maybe. And I don't know you were there. I was not there. Maybe she's saying, Hey, here's what I'm looking for in life. Um,

These are what I consider gender roles. I would love to be in a relationship where maybe the guy works, maybe I stay at home with the kids. She could just be sharing that that's something that she's looking for. Did I miss it? I think she's right. Josh, did she say, I want you to buy me this and buy me that? I mean, was it very obvious, or is this just a young lady talking about what life might look like? In separate instances, it's been both.

Well, you're worried about stuff you shouldn't be worried about. Let me put it this way. Jade, when you and Sam got serious. You don't want to ask me this question. Yes, I do. What were you thinking? What were you wondering about Sam? My exact words were, you've got to come correct. Those were my exact words, meaning I have a high standard of work ethic and what we both do. Did you ask him about his professional future and what he thought he was going to do with his life? I didn't have to ask. I could see it.

Okay, but my point is you were interested in it. I was interested. I'm like, listen, I'm a go-getter. You're a go-getter. Everything we do, we do 100%. That was the standard. It's like, if you're going to be around me, you got to come correct because I'm an intense person. And so that was that on that. All right, so I'm putting Josh on hold here. I said what I said. What's your dating? I think he needs to be in better pools. He probably needs to be in better pools. I also think that...

and I don't say this to be, there's no salt or shade on this. I do think that he's viewing himself in a light that's a little bit puffy. Oh, 100%. And so I think that if he just kind of chills a little bit, everybody's not after him. You're doing well, but you've not like... You don't have a proclivity to build wealth yet. You're 25. Yeah.

Can I just say that? Yes. I mean, come on, man. You're doing well, but chill out. Yeah, relax. Use your discernment and get a good group of friends who can discern on the ladies for you. That always helps. This is The Ramsey Show. We'll be right back. You know, one of the first things I discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies.

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Welcome back to the Ramsey Show. Ken Coleman and Jade Warshaw helping you through this hour. 888-825-5225. Michelle is joining us now in Jacksonville, Florida. Michelle, how can we help? Well, I have an adult son who's in a situation where he has a house with his girlfriend, and they have a good interest rate and a really good payment, and they broke up, and so she wants him to refinance the house.

in his name and he has bad credit, I put $40,000 down on the house for them. And he wants me to either help him to get the house by co-signing for it or for me just to buy it outright. And then he rents from me. But I've been helping him his whole life and he's like 35. And I just don't know. I'm a widow and I don't know when to say. I guess he has a history of mental illness and of substance abuse. So I kind of,

You're scared. Yes, I'm scared. He finally got a good job, really good job, but he can't manage his money. Yeah, well, don't buy this house for him. Do not put yourself in this situation. But I also understand you're scared, but I think this is the moment where he's looking to you for direction anyway. If he's got a really good job, you're just going to sit down with him and be okay to let him know that,

why you're not doing it and what his real options are. And the two of these, these two young people are on the, well, they're not even that young for heaven's sakes. They're on the, the, the home, both of their names are on the home.

Both of their names are on the deed, but only his girlfriend's name is on the loan. So she's suing him to force him to refinance the house or move out. And he doesn't have the credit to refinance it. Well, then it's a really clear decision. He moves out. Yeah. He moves out. I'm just so scared this is his only chance in life to own a house. No. No, no, no, no, no. Of course it's not. What is the evidence that this is the only time he could ever own a home?

Well, he makes about $60,000 a year, and they each pay half of the mortgage payment, so they each pay $750,000. And he says he can't afford child support. They have a child together. He can't afford a mortgage payment. He can't afford a new car. His car is about to die on the side of the road. He wants me to co-sign for a car, too. Credit card is max, no money in savings. But I don't want him to be homeless and on the side of the road with no car and...

And I just have fears. I get it. My husband died, so he's not here to, like, allay my fears. Well, there's so many other options, though. You're choosing options that put burden on you. And you called because, quite frankly, you're exhausted at the idea of doing this. The very idea of doing this is exhausting, and it's probably equal parts scary. And the only reason you're even...

Considering this and not saying hard pass immediately is because you're worried about your boy. He's had a lot of struggles and you feel like, but I got to tell you, I think this is a blessing in disguise. He's got a new job, a good paying job. Sounds like there might be some growth opportunity. They break up. He needs to get out of this house because it's the only shot he's got to be able to afford the child support because he didn't have any shot on that. The judge is going to decide that.

But he says that rent is higher than his mortgage payment. Not if he's sharing. No, not if he's renting with one or two other guys that are single. And believe me, there's plenty of those in Jacksonville, Florida. This is where you can mama him in the sense of showing him adult options and saying one of the options that you don't have is me. So here are the other options.

Yeah. He's even down to saying he can't afford to move the stuff out of his house or for a rental storage unit. I wish he was on the phone because this guy needs a good sip of grown-up juice. Did you say that you put the $40,000 down for this house that the girlfriend basically has the right of ownership to?

Well, they each have a 50-50 ownership share, and he was living at my house in the basement paying no rent, and he had trashed my basement because he was on substances at that time. So I honestly just wanted him out, and for my peace of mind, I put down

I put down $40,000, yeah, and it was in 2022. Then you're not getting that money back. No, and that's why he held that over my head and said, I hate to see you lose your $40,000. Let's refinance this together. Now he's pissing me off. I felt a little bad for him. But now this is a kid who's manipulating you, and you know why he's doing it? No. Because it works.

Yeah, it always has worked. I operate on guilt a lot. Today's the day. 35-year-old boy needs to understand it's time to be a 35-year-old man. And the best way he's going to do that is you have to look at him and go, and by the way, I'd be okay being really raw and sharing your emotion. Share with him why you've done this in the past because of guilt. And now you've got to earn this and go, I can't do it anymore. I can't. It's not good for me and it's not good for you. And I know deep down you don't want me to hurt me.

I don't know, Jade. I don't have anything but tough love here. What do you? I have nothing but tough love. I'm holding my tongue. My son is young and you're further along in life than I am. And so there's part of me that just wants to wallop this dude. But I also understand that there's, you know, like there's motherly love here. And so I get that. I can understand that there's this pull that you probably have to want to get involved with.

But I also feel like you can't like you got to just let this guy do what he's going to do. And all you can do is pray. And, you know, you know, he needs Michelle. I'm going to tell you the one thing I think you can and should do in this situation. We already told you what not to do. I think he needs belief from Mama, not help.

Oh, that is probably something I've never really offered. That's true because I'm always operating on fear and guilt. And by the way, you have, and listen to me, Michelle, I say this, I say this with a father's heart and I say this from my own experience. He needs belief. No more help. You need to sit down with him and tell him what he should do and show him that he can do it. And then you need to walk away. Okay.

And you need to be, I think you need to be his number one cheerleader. I love that Ken. Oh, that's so good. It's so good. It's tough. I, you know, it's so hard cause we want to help our kids. My goodness. I mean, I, it's just so hard. I get it. I truly get it. Yeah.

But at this point, I mean, and that's the rub, right? He's 35. He's not a boy. I honestly think when it comes to this house, I think they just need to sell it. I was going to suggest that. Whatever the profit is, give it back to mama. She's the one that put the money down to begin with. I was going to ask you that, but see, you get the girlfriend involved and her name's on it. So she gets all the dough. She's on it. Yeah.

Yeah. They need to get a lawyer involved that this is what happened. This is what, yeah, but mama does. Mom is already, if she wants her money back, if she cares anything, she might not care. She might be like, I washed my hands of the situation. I'm out. Um, but if she's like, man, I'd love to get my 40,000 back. I'd love to, you know, talk to, talk to somebody to see how, how this happens. Um,

I just don't want her racking up 10 grand in legal fees. And that's that doesn't take long. But I like what you're saying. But I think this is the get out of jail free card for this guy. I wish we had him on the phone and say, you got I know you guys broke up and that sucks. I know you got a kid. But the girlfriend's going to want his name off the deed. I'm not right. I'm not exactly sure what the process for that the best process for him to start over.

Yeah. Meaning he's already got the breakup. 100%. He's got a good job. Yeah. But I don't buy this rent is so expensive. He's manipulating there. He's manipulating. He's got child support coming, staring him in the face, Jay. He's got a lot. He needs to make more than $60,000. And he's just got to get his life together. Yeah, he's got to grow up. My guy's got, he's got a lot to get together. By the way, Jade, I'm going to give it to you. We've got about a minute and a half. This is a great time for new listeners and viewers that come in all the time. I want you to tell them why this call...

is exhibit A on why we shouldn't buy a house with somebody we're not married to. Go ahead. Because there's no clear rights. Like I said, with this, it's like, okay, both their names on the deed, one name's on the title, mom put the money down. Like there's such a tangled web here and it's going to take a lot to untangle. That's why I said, if I was mom and I wanted to see about this, it's like now you got to involve a lawyer in a different sort of way. There's no clear division of assets. And so this is just...

what is known as a hot...

steaming pile. Ken, that's what this is. And so it's not good. Don't play house. Don't play house. I haven't heard that in a long time. That's what this is. I know, but that's how I know your dad's a preacher. Oh, 100%. That's true. It's true. I can't get it. You can take the preacher's kid out of the church. You can take the church out of the preacher's kid, right? But you know, that's what happened here. We love each other. Let's go in and do this house. Yeah. And now look at it. You know what? They would benefit from some counseling too.

They really would. The two of them, mom and son together, mom on his own, on her own. I just saw flashes of a reality show where you're coming in and telling these two, get your stuff fixed and just love each other and get married and get this nonsense over with. I'm not a counselor, but I can send them to better help, and they can help him out. I think you could be a matchmaker. You think I could? Sit down and be quiet. Let Jay fix this. Act like you got some home training. This is The Ramsey Show. ♪♪

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Welcome back to The Ramsey Show, where we help you win with your money, win in your work, and win in your relationships. I'm Ken Coleman. Jade Warshaw is with me. 888-825-5225 is the phone number to jump in. Let's get back to the phones. Chris is there in Columbus, Ohio. Chris, how can we help today? Hi there. How are you guys doing today? We're doing great. What's going on?

Well, straight to the point, I got into some credit card debts. How much? About $50,000. What happened? Yeah.

That's a lot. What took place? It is. So, all right, about 2021, I bought a house. Went into it having a little bit of credit card debt. When, what I didn't realize is when buying a house, there's stuff that needs help. You know, I had, it's, you know, I went in like, you know, maybe $8,000 in credit card debt. And,

And had it sitting on a 0%, balance transferred, you know, I wasn't that worried. And it was great. I still think the house was a good investment. We got in sub 3% on the interest rate and value's gone up by like 25%. But the cost of ownership, the cost of owning the house, a lot of times that just fell to the credit cards. Yeah.

Yeah. Was that because, so the question I have, is that because you didn't have any margin in your paycheck when it came to everything else? And so any kind of house repairs or all that was just a squeeze on you? Or was it because you had a new house and you're all excited and you guys wanted to start doing some projects and you didn't have the cash for it, so you thought, well, we'll just put it on the card. Was it that, some of both? What are we talking about?

A little bit of both. I mean, so, you know, I got young boys. They are, when we moved in here, they were eight and six. And man, that's really the perfect time to build a tree house in the backyard. So, you know, guess where that went? That went to the credit card.

Okay. You know, we got a half bath downstairs and I'm pretty handy. I can do a lot of stuff myself. Well, what percentage of your... It's real easy to... What do you take home every month? What's your take home pay between you and your wife? So I'm making about a hundred a year. And that's just because of a new position that I've taken this year. Last year and when I bought the house, I was making about 85. And what's your take home pay? What do you see on your check every month?

Uh, let's see. I make 13 and change every week. Every week? 1,300? Yes. Okay. And then what percent, how much is your mortgage? 2,400 with taxes. Okay. So 5,200 net, right? Yeah. Wow. So that, that's, that's a little bit, tell me again, I'm sorry, Ken said something. Tell me again the, what your mortgage is every month?

$2,400. $2,400. Okay. I think that's where some of the problem is because you're getting really close to that being half of your take-home pay. Yeah.

It very much is. And so that's where we get into this. Because I mean, think about it like this. And I don't think people take enough time to think about these ratios. We say, all right, your mortgage should be no more than 25% of your take home. So there's 25 there. If you're a giving person, you're probably doing around 10% there. And then when it comes time to do your investing, you're doing 15% there. That's 50% right there. So if you mess around and your mortgage creeps up,

25 more points, you're at 75% of your income and you haven't even done anything yet. So yeah, no wonder you would be going to credit cards, right? Because you haven't even bought groceries. You hadn't, you know, taken a vacation. You've done nothing. So I think that what's really, really squeezing you is the mortgage. That's probably thing one. And then if you're not on a really tight budget, then this money just disappears. Are you guys doing an every dollar budget?

We're very good about budget. We're both emotional people, and so occasionally do have some impulse purchases that take us outside of that budget. And you're aware of it. Oh, yeah. Yeah. Okay. So what it might be for you guys... Okay. But that's not sustainable. So what it might be for you guys, it's one of two things. The first thing is...

If we know that we're on a tight budget and we knowingly say we can't afford this, but we're going to put on the credit card, you know, we're going to do that. So you've decided that. And so for that reason, then you need to say, OK, this is a habit we have and it's not working for us. Let's cut up the credit card.

That way, when that sneaky feeling of let's build a treehouse sneaks up, you can't put it on a credit card because you ain't got a credit card, right? So let's take the cookies off the shelf so you're not tempted by them. And then you're forced to stick to your budget. And then what will happen is you'll go, man, I'm just...

I'm not happy with something with our lifestyle. We want more money. And then your creative brain will kick in and you'll go, okay, what can we do to bring up our income? And you won't be dependent on these credit cards anymore. I think you should cut your card up right now on the air. Uh-oh. Uh-oh. I double dog dare you. Did you hear the chuckle?

That was the respectful chuckle. It's an uncomfortable laugh. Where's the credit card? I'll take it. Do all of them. Cut them right now. Yeah, I know. Yeah. You know what? I would. Honestly, we've stopped using them. I used to be in the habit of, you know, we put everything on the credit card and we pay it off. But, you know, just a couple of those times where it has leaked beyond where we were able to find it.

will we pay it off? Chris, you're not ready. He's not ready. Chris, you're not ready, buddy. You said I would, but... You gotta get... Here's the problem. I don't think you've hit... I don't think you're ready. Yeah. I don't think you've hit that moment of... 10 more grand? Should he charge 10 more grand? Let's get it to 60 grand. I mean... What's gonna make you miserable enough? Something's gonna have to make you so uncomfortable with these things that you're like, no, my...

more. That's what we find. Ken, that is what we find on this show. I agree 100%. You're not there. You're not there yet. You called us. So what is the reason for calling us? I feel pretty close. What's the reason for calling us? So my question is dealing with the credit card debt. I feel like I've got three, well maybe four. We just told you. We've got to stop using them first.

And then we pay it down. Roll this over in your mind, Chris. Roll this over in your mind. You cannot solve a problem while simultaneously creating it. So as long as you have these credit cards, you're creating the problem. So you'll never solve it. It's infinite.

It's the cat chasing its tail, dog chasing its tail. So you have to stop the crazy cycle. And the way you stop the crazy cycle is you say, I'm not going to keep contributing to this problem. I'm not going to keep adding to the pile. I'm going to stop it, turn off the faucet. Then you can clean up the mess. Yes. Absolutely. And so what Ken and I were at that point, and that's what kind of why I'm calling. Then you got to cut.

snap them up yeah put them through the little dude i'll cut them up right now yes there we go because you guys got an impulse problem yeah and you just said that those are your words you got them right now we got we got about a minute and a half you got them on you yeah you got it you want to take carbs let's go to town yeah do it do it and you're gonna be in the fetal position later today you're gonna maybe sob in the shower because you're gonna realize oh my gosh i had this this was a security blanket all right so you got some scissors

Hold on. Okay. Tell everybody what's happening right now. Describe what's happening. We've got to make this exciting. Oh, should I use names? Okay, which one have we got here? Hold it up. Tell us what it's called. Chase Visa. Ooh, Chase Visa. Hold it near the phone so we can hear it. Okay, hold on. Chase, this is a Chase Visa. Let's see if you can hear that. Did you catch it?

We heard the cut, and we heard the exhale. Are you sure you weren't giving yourself a haircut? That sounded like barber scissors. We got to go. We got about 45 seconds. What's next? Options for getting at the credit card. I don't want to do something stupid, but, I mean, with these, they're charging 30%. Cut it. Stop talking and cut it. Cut it.

I'll cut another one. Come on, man. You got it. Which one are you cutting? Tell us quick. Hold on. City card. City card. Go. Yes. Out of here. We won't wait for the sound. Just tell us when it's cut. Oh, yes. There it is. It's gone. That's great. How many more you got?

Wait till I get to the MX in the drawer. Keep doing it. Keep going. Keep going. Well, you know what? We're a cash business, and we got a lot of people that need to hear these advertisements coming up. So we got to take care of business. You, my friend, need to keep cutting. Yeah. Keep cutting. Don't stop. Good job. Good job, Chris. Love it. Did you hear that every time he cut one? He went, he went, oh. Yeah. It's painful. It's visceral. You feel it.

That is so fantastic. Keep cutting, Chris. Yes. All right, we'll be right back. This is the Ramsey Show.

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Welcome back to The Ramsey Show. I'm Ken Coleman and Jade Warshaw is alongside 888-825-5225. That's the phone number to jump in. We'd love to hear from you. Taking your money calls, your income related calls today. Matthew is joining us in Houston, Texas. Matthew, how can we help? Hey guys, how are you today? Good, how are you? I'm good, thank you.

So I'm 25 years old, a career salesman. At the beginning of this year, I landed a new job, which I've been, you know, my income has grown drastically and I'm closing on a house at the end of the month.

And I just wanted to know, you know, at my age, I want to start investing early. I also want to be debt free. Is there a balance to investing, you know, post-tax dollars and paying off the home? Or should all of my excess cash just be going to the principal and, you know, I start investing once that's paid off? Because, you know, at my age, the value of the compound interest, if I start now, I feel it could really pay off down the road.

So I just wanted to get your thoughts on that. Yeah, I mean, I think it's a good question to have. And I think it's a question that a lot of people have. So you just closed on this home. Let's make sure you're in the position to begin investing. Do you have three to six months of expenses saved? I do. Okay, great. And then at that point, you would be considered baby step four, which is you're investing 15% of your gross income every single month. Are you doing that?

I haven't started. Well, I contribute to my company's 401k plan. But other than that, I haven't I haven't started, which is pre-tax, but I haven't started investing any post-tax money yet. OK, good. So what what I would say is whatever you're doing now, if you have if you have access to a match through that employer account, I would invest up to that match. And you said it's an after tax. Yeah.

It's a pre-tax with my employers. So they match 3%. I'm contributing 6% right now. Okay. So I would do up to the match and then I would go over to a Roth IRA and I would go ahead and max something like that out. And then if you still have money left in your 15% of contributions, then you could go back out and get as close to maxing out that 401k as possible. Okay.

The goal here is, again, for you to be investing 15% of your gross income. And most people do it on a monthly basis because, you know, you can kind of set it and forget it with your employer. And so that's what I would do. And then beyond the 15%, any money that you have extra, I would put it towards the paying off of the house.

And so that's the way we teach at 25 years old. You're not married yet. You don't have any kids yet. So you can kind of forget for now about baby step five because you don't have any kids. There's no 529 that you need to really add to. And so then for you, the next step is baby step six. You're putting extra money towards the house and you get to decide how intentional you're going to be about that. Right. You don't have to go crazy like you did with the other baby steps, but you're a single guy. You could probably...

you know, make a lot of headway on that. What do you owe on the house? So around 450, 460. Okay. I haven't even made my first mortgage payment yet. Yeah. You said you closed here. You haven't even closed yet, right? Or you just haven't closed yet. Right. Okay. Yeah. And so that's what I would advise you to do. That's what I did. And that's what I do. Yeah. I'm going to agree with you. I mean, I, I, I love Jade's advice. Follow it.

But I just want to commend you. I love this. Excellent. I love this mindset that you've got, man. You haven't even made the first payment yet. You're calling and going.

what do I do first? But we want you to be set up for the long term and you're going to have no problem getting rid of the house payment. And the reason I suggested you going to the Roth right after the 3% is we want that 3% match. I mean, obviously that's free money, but then I love the Roth option for you because on down the line, you're going to want money that you have access to that you don't have to pay taxes on and that you don't have that required minimum distribution. And so that's why we would say that

and then come back and you can fill up that 401k when you're done. What do you expect to make in the next 12 months?

I'd say around $400,000. Wow, my son. See, I've been wanting to ask that. I had to wait. I didn't want to interrupt. But I was going, I had a sense that he was... Killing it? He had jumped into a... Well, when he told us the amount on the house, I was like, wait a second. Yeah, yeah, yeah. So the only reason I ask that, again, this is all an exclamation point to what Jade said. I can't add anything to what she said on that. With that kind of income, you're going to be fine.

you're going to be more than fine. So you'll just follow the baby steps. And with that kind of income, man, it is going to be ridiculous. Okay. Have you gotten your hands on an investment calculator?

I, so I was just going to mention, I took a look at the amortization schedule on the loan and that really just kind of ticked me off, you know? Sure. So I want to. Let it tick you off, but go in order. You know what I mean? Right. Get your investment strategy because, because with that kind of income and, and what Jade's talking about with the investment calculator is one of her favorite things to do. It is. Are you running some numbers for him? I want to run a few numbers for him. Because he's so upset about his loan, his, his, his mortgage. Yeah.

his amortization payment. We need to get his mind focused on this part of the advice. Okay, so then let's play a game. How much do you already have in retirement investments? Do you have any? Only maybe $6,000 or $7,000. Okay, I'll put $7,000 in there. All right, and then let's say you contribute, let's see, $60,000 a year. So let's say $5,000 a month. All right, and then we'll get you at 10% rate of return.

Cause you make a lot of money, dude. If you don't do anything else from now until forever, like from now until 65. Oh, actually hold on. Hold on. Yeah. I was going to say, I accidentally put in the wrong retirement age, but it's actually worth noting. I put in 48. Like if you were to retire at 48, you'd have 5.3 million. I thought I put in, I thought I put in 65. Let's put in 65 and see what it says. If you go till 65, you're,

I'm shook. Tell him the number. Now, remind him what he's putting in every year. No, this is monthly. Monthly. If you put in $5,000 a month because you make $400,000. Yeah, that's $60,000 a year. That's $60,000 a year at a 10% annual rate of return. You already have $7,000 there. If you do this from age 25, you said you're 25, right? Yeah, I'm 25. Until age 65. You sitting down? Are you sitting down? Because I'm standing up.

$31 million. $31 million. That's crazy. I had to put my pinky like on Austin Powers. Yeah. So now you feel a little bit better?

I do. I feel a lot better. But, you know, and that's really why I called you guys. Because I know that, you know, if I start now, by the time I'm, you know, 65, it's going to make a huge difference. And oh, by the way, that doesn't mean you aren't paying your house off.

You're still paying the house off. Yeah, we didn't even talk about that. And we didn't even talk about the fact that this is you starting. Like, this is not you at your full potential. You're still going up in the world. You're still on an upward trajectory. Man, I thought something was wrong with my calculator. No, that's 15% of your income. And oh, by the way, after you budget all that, you are now making extra payments on the house. Oh, yeah. And you'll pay the house off before you know it. So this isn't an either or. It's both and. That's the point of the exercise. Matthew, I'm happy that I

know you. I'm happy I got to talk on the phone to you. Hey, check back in with us. Keep letting us know how this goes because so many people need to hear this. If you can get these things firing on all cylinders, even if you're not making $400,000 a year, if you're making $200,000 a year, what is possible when you get a hold of your finances so early is so amazing.

And for anybody listening, if you've never played with an investment calculator, I suggest we have a great one, RamseySolutions.com. You can check it out. Or you can just Google Ramsey Investment Calculator and it'll pop up. But start playing with those numbers to see what your life can be. And, I mean, that's motivating at the very least. Yeah, absolutely. Thanks for the call. Love the breakdown, Jay. That's always fun when we get into the numbers. Because, you know, in his mind, he's like, I've got to pay that house off. I've got to pay that house off. And it's like, no, it's both and.

It's both and. It's not either or. And fun to run those numbers. And boy, that's a staggering number. That is a staggering number. And let me just... And not many people make his money. No, they don't. I want to at least call that out. Or at that early in life. At 25, to be making 400K. No, this... He's in the top 1%. That's top 1%, 100%. So I just want to at least call that out. But let's also, Ken, let's explain why we care so much about...

paying off the primary mortgage. Tell us. Because at the end of the day, yes, we want you to have the compound interest. But at the end of the day, there is going to be a time where you do not work and you don't want to be making payments on a mortgage. Your mortgage is the biggest line item in your budget. You want that done and paid for by the time you're, you know, that age so that you can just live. Yeah, I totally, totally agree.

There's a young man that's living like no one else, I promise you. He's going to be living like no one else and also giving like no one else. At a young age, by the way. Great stuff. Good hour, Jade Warshaw. All right, that does it for this hour. There will be more Ramsey Show, I promise.

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Welcome to the Ramsey Show, where we coach you to win in your life, specifically winning in your money or with your money, winning in your work and winning in your relationships. The phone number for you to get coached up today is 888-825-5225. I'm Ken Coleman. Jade Warshaw is with me, and we're here for you. 888-825-5225. We'll start it off in the Motor City, Detroit, Michigan. Sarah is on the line. Sarah, how can we help?

Hello? Hi. How are you? Hi. Good. How are you doing? Good. What can we help with?

Well, first of all, thank you for taking my call. I love you guys. You guys are absolutely amazing and helped me so far. The challenge I'm facing now is I have $300,000 worth of debt, and I just can't see a way out. I'm working three jobs, and it just doesn't seem to work. Wow. Well, break it down for Jade here. So start off with your income through the three different jobs. Give us a range, and then walk her through your debt.

My salary position, I bring in 80. I'm sorry. My salary is 80. I gross. I'm sorry. I bring in 80 and then I net 55 when you take out tax and insurance. Mm-hmm.

And then I have a second job that I gross 40, but then I'm an independent contractor, so I have to take out taxes and stuff. So I net about $30,000 to $35,000. Good. And then I have another part-time job that brings in about $600 a month. Okay. Okay. So $72,000 on the $85,000. So you're somewhere in that $92,000, $93,000 range with those numbers. Is that right? Net? Yeah. I mean, that sounds amazing, but that's...

Yeah. Yeah, but you can do something with that. Yeah. Dr. Jade is in today, so it's going to be okay. I'm going to pretend like you didn't say that. The debt doctor, no? Okay, okay, I'll take that. You didn't know what I was doing. I didn't know where you were going. Sarah, now that I know where he's going. You can do surgery on this. I can help you. There you go. So you're bringing in almost $8,000 a month, which ain't too shabby, but you've got $300,000 of debt. So walk us through this debt. It's all student loans.

Okay. Private? Federal? I have $12,000 of private. I will have those hopefully paid off by December. The rest, the $300,000 is all government. What was it for? I'm just curious. I went to law school. And are we practicing law? Yes. And that's the number one amount of money you gave us? What kind of law are you doing?

Yeah, I do estate planning, probate stuff. Gosh, it feels like we've got a path to be making a whole lot more than that. Am I right? Or are you feeling like you're capped out and why? No, you hit the nail on the head. I've been looking on Indeed and stuff and I'm...

That's actually the average pay for where I live. And it's pretty, it's hard to deal with because I do feel that I should earn more, but it's about average. Is there anything keeping you tied to the Detroit area? Family, yeah. Okay. Okay. All right, one other silly question, Jayden, and I'll get out of the way. I am curious with what you've done so far, is there a pivot that,

or some type of additional legal work that you could do that would add to your income based on your current qualification or specialization? So I got my real estate license about a year and a half ago. So that's my second job. Yeah, I'm talking just the legal field right now.

Well, the reason why I got a different type of job is I'm really burnt out practicing law. So I'm trying to expand on other things. So that's why I got my real estate license to help bring in more money. But that's extremely part time. But I really want to try to pivot out of practicing. I get it. But I'm going to and again, I'm about ready to hand it to you, Jade. No problem. But you got $300,000 in law school debt.

I don't think you get the burnout yet. And I think that the greatest opportunity for you to make money is through your law, your legal work. You just don't have time to sell houses. That's a full-time deal. So it's either or. It's like you go all in on selling homes-

And if you do that, then there's no limit to what you can make. But I'm just going to make that point. You know, you've got to bring in some more income here because $300,000 is doable. I'm going to hand it over to Jade. Jade, walk her through the process here. Okay, so the loans, did you consolidate them or are they single, singular? They're single. Okay, good. That's good. That's good. Okay, so as trite as this may sound,

All we're doing is listing them from smallest to largest and we're paying minimum payments on all of them. Hopefully, I don't know, are you enrolled in any of the assistance plans? Are you in save plan or anything like that? The income driven payment, I've been on that for about 13 years. Okay. And is it going to run out or do you still have time to be on it?

I mean, honestly, I try to re-enroll and it takes months and months to get an answer. So I don't know. I'm kind of in limbo right now. Okay. What's your current payment for the lot of them?

I don't pay anything. Okay, good. So here's what we do. The fact that your minimum payments are zero is a good thing for you right now because that means you can put the full strength of your income on the smallest debt and knock it out fast. I wish there was a way to tell you that there was an easy button here. There's just not. And if you've listened to our show for any bit of time, you know my husband and I had 280, okay? And at the time, we weren't making what combined what you're making now. And so-

There's a part of this that you have to just...

ride that income until the debt is gone. Once you have maxed out your money for your time, and I don't know that you have yet, I agree with Ken, I think that you can do more to max out your time and get better money for it. But once you do hit that point, there is a point where you just go, okay, this is what I'm making and this is how long it's going to take. And as I've said many times before, you got to ride that horse to the old town road. That's what you got to do.

And then when it's done, it's done. That song is going to be in my head now all day. And I'm having you to thank for that. I'm kind of like, yeah, and I'm kind of like torn because I actually make more money selling real estate in half the amount of time versus my salary position. Of course, I get that paycheck every two weeks. Well, what's that transition look like? Because that's what I'm getting at. Like if you get after it and you can double, triple your income, this is a game changer. Key word is consistently.

If you can do that consistently, then that's a great sign. It's almost like what would have to be true for you to change your schedule, stock some money up or something to be able to then go, all right, I'm dropping one of these jobs. My gosh, you got more jobs, you know, than you know what to do with right now. So we got to create some margin time-wise, which means we got to have some margin money-wise. Right, Jade? You tracking with me? I'm tracking with you. What would it take for her to get to a place where,

To where she can now go all in on real estate, and that's going to take a little bit of time to build that pipeline up. Yeah. I mean, we're always looking for you to be able to replace whatever your income was at its best, right? And if you can do that consistently with real estate, I say more power to you. The weird thing about real estate, though, is of its nature, it tends to be up and down. What's the market like in Detroit area?

It's slow. I get consistent at least March 2 listings and closings, but it's a roller coaster.

See, so you got it to Jade's point. We've got to factor that in. The market determines what's going on in some degree. You don't just, you know, hang a shingle and it's everybody wants to buy a house from you. I'm going to tell you, when you have this kind of debt, there is something to be said for being able to count on. I know what's coming in and I know what I'm doing with it. There's just kind of that assembly line that you can just...

I'm cranking it out. I'm paying off the debt, and this is temporary, and when the time comes, you'll do what you love. Yeah, I agree. Because of the market where it's at, I'm going to go with Jade's. Decide what you can do and lock in on it, and then if something changes, then the timeline changes, but get that mindset for the climb. It's going to take me a while to climb this mountain, but I will get there. Appreciate the call. You got this. Stay encouraged. This is The Ramsey Show. ♪

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Welcome back to the Ramsey Show America alongside Jade Warshaw and Ken Coleman. The phone number for you to jump in, we'd love to coach up today, is 888-825-5225. 888-825-5225. Amy joins us now in Vancouver. Amy, how can we help today?

Hi, my question is about a shared asset I have with my other adult siblings. So the asset is actually in Texas and it was given to all of us by my parents. And it was, it's definitely been a blessing and it's,

Um, it's getting to the point where there wasn't really a longterm plan put in place. So it's starting to feel less like a blessing and more of a point of conflict. Um, so me and all my siblings have lived there. It's a house. Um,

And me and all my siblings, our names are on it. And we have all lived there at some point while paying rent, except my brother is now... He's been in the house for about six years, and he hasn't paid rent. And he's currently...

on leave with the military. And I tried to reach out to make a plan before he left and he didn't respond to anything. So I'm wondering how to navigate this asset and keep it a blessing while preserving our relationship. How many siblings total? There's four of us. And how did he get this

deal? How did he just start living in when everybody else has lived in it and paid rent? I'm presuming you guys have rented it to other people as well. Is that true? I think we've rented it to one other family. How did he get away with living rent-free for six years? So

It was kind of like on your integrity. There was an account set up and you put a certain amount in that account every month. And he decided he didn't want to use that same account. He wanted to do his own thing, which we're like, that's fine. You know, you can pay rent how you like. What is the rent? What is it? It's $250 a month. Oh, my gosh. This is a joke. And so he's not been paying it. Not once. What do the other siblings think about this?

So basically, like, we would, we don't know how to resolve it. The communication is not great. They kind of want to be like, well, yeah, we'd like to talk about the kind of written it off as like, oh, like, we're just never going to see money from that. It's just never gonna, nothing's going to change. How do you arrive at the 250? Is that like an arbitrary amount? Or is that maintenance? What is that?

So that was set up like over a decade ago, like a long time ago. And it was with the purpose of like, oh, this is affordable so we can live in it and save money so we can, you know, kind of get ahead. It doesn't include like utilities or anything like that. So all four of you are on the deed? Yes. What's it worth?

the asset? Probably $200,000 on the bottom side, the low side. And there's no debt on it, right? No, no. So do the other three siblings, I'm sorry, there's four of you, so the other two plus you, are they all wanting to get out of this as well? Are you there? I'm sorry, I couldn't hear the end of that question. Okay. I'm here. I'm asking...

Do the other siblings, are they in agreement with you about they want to get out, or are you the only one thinking, going, how do I get out of this? No, the other siblings were all in agreement. Okay. Okay, well, that helps. Majority rules. So I'm going to – I don't know – so I want to say something, but I'll first say I don't know – I've never experienced this before, so –

I would be seeking counsel, actual legal counsel on this, on what your options are when you've got four people on a deed, three want to get out. I just don't know enough legal on that. But I would say this. However this goes down, it's time for three of you to stop letting him bully you.

This guy's a bully. And I know it's your brother. I'm just telling you like it is. He's not returning your calls. He's just acting like a school ground, like on the playground bully. I'm not going to talk to you. I'm giving you the silent treatment. I'm creating all this tension.

And I'm not playing ball. I'm just creating all this and I'm daring you. He's daring you guys to do something. And I think he's doing it because he knows you're not willing to do anything about it. And I think that's the only little thing I wanted to put in there because I think however you resolve this...

Jade, I'll get out of the way if you've got a point on this, but I think whatever needs to happen, he needs to realize the gig is up. Yeah, I think... You've long outstayed your welcome. You've taken advantage of us. It's over. Yeah, so just for clarity for me, so you guys, the plan was when you live in the house, you put the $250 in the account, and that's split amongst the other three siblings, right? No, so that amount goes just towards repairs, like, oh, something like breaks. Okay.

You have money in the account to pay for it. And so while he's been living in the house, if something broke, what happened? I'm not sure. So, well, he there are things broken and they're just not fixed. So he just didn't take care of the place while he was there either. Right.

Oh, wow. Okay. So yeah, I mean, the majority rules here, if you have to get a judge to force this, I don't think it would be that difficult to do it. We could talk about the idea of him buying you guys out, but I don't think that's going to happen. It's just not going to happen. So yeah, you might have to sit down, all of you guys sit down and try to make it light. But for me, the fact that you're calling, it's no longer light. So you can try to keep that a light conversation. But

I think the longer you let this go on, the worse it gets. So to Ken's point, yeah, I think you guys get together. Somebody talk to a judge and say, how do we force this? Because we're ready to sell it. We've kept it this long. He's not paying rent. And the truth is, um,

I kind of like the fact that he doesn't owe each of you because I mean, if you guys are splitting this money, truly he'd owe each of you $6,000, but he doesn't since he's not even taking care of the place. Although who knows if that'll affect the resale value, but I'd get out of it immediately. I would too. Cause if you look at this split, let's say they sell it for 200 and you get, it's less than 50 grand each. Yeah.

It's just not enough money to be dealing with all this garbage. So Amy, I'm with you. I think your instincts are right. Let's get out of this thing. No messing around. It's not worth spending a bunch with a lawyer to the judge thing, whatever. I think Jade's right. Let's clean, efficient, force his hand. We're selling this thing and we avoid all the tension. And then Thanksgiving and Christmas takes care of itself. But yeah, I'd get out quick. I really would. That's an unfortunate situation. I mean, when you get... And see, that's... Okay, so I'm sitting here...

And I didn't ask. Okay. I've already put her on hold. But like, I didn't ask. I guess I should have. If mom and dad are still alive, I got the picture they aren't around. I got the feeling they're not around. But I just, and for that reason, I just, I sat there and I went, note to self, if Stacey and I want to bless our three kids-

I need to bless them individually, not try to do a, hey, we're going to do this asset and work the three of you into it. I just sit there and I went, note to self. Cash money. And individually. Yes. You're not in it together. Yeah. I'm blessing you this way. I'm blessing you this way, this way. And it's not this like joint thing where there's just, it's just what, I don't see what the value is in that. It was probably the family home is my guess. And yeah.

I think they probably had the option to sell it early on, but they weren't ready to part with it yet. And so it probably just became, listen, I am adding all sorts of story to this that I don't know are true. So I'm sorry if that's not true. But you agree, right? To give four kids a house. All right, you guys, here you go. Yeah.

Even if there's not a problem, it just feels like it's easy for a problem to exist because you have four different people who have four different views of life. Yeah. Money. It's like when you get a gift card to a restaurant you don't really like. You're happy for the gift card, but now you're forced to eat at Applebee's. Oh, yeah.

Jeez, you just went there. Just saying. A shot across the bow. I'm just saying. Eating good in the neighborhood. You're like, thank you. I mean, there's a lot of people that like an Applebee's. Hey, note to self, team. No Applebee's gift cards for Jade. That would not go over well. Yeah, it's happened. Where would one get you a gift card to? I'm with you. Asking for a friend. Visa gift card.

No, no, I want to know. I'm putting you on the spot. 20 seconds. If I'm going to get you, Stacey and I are going to get you and Sam a gift card to a restaurant, where do you want to go? It has to be national so people know it. Okay.

Come on. I don't know. Jay Alexander's? Do you guys have that? Yeah, do you guys? You live here too. I'm not going to lie. Do you guys have that? Are you aware you live in Middle Tennessee as well? I wanted to say Red Lobster. I don't mind that at all. I love a good lobster. All right, quick break. This is The Ramsey Show.

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You're listening to The Ramsey Show. I'm Jade Warshaw. Next to me is Ken Coleman. Let's go. Best-selling author of many books, but most recently, Find the Work Your Wire to Do, home of the Get Clear podcast.

career assessment, which is very, very great. Very fun. Very fun tool. And it's always good to be with you. By the way, you're a bestselling author too. Yeah. Money's not a math problem. Pick it up. You can find them all at RamseySolutions.com slash store. Get into it. Get involved. I want to get involved with these phone lines. And by the way, if you want to get involved with us, call us. The number is 888-

825-5225 and we will pick up your call. Let's pick up Alicia's call. Alyssa actually is how we're going to pronounce that. Green Bay, Wisconsin. What's going on, Alyssa? Hi, thanks so much for taking my call. Did I say it right?

Um, it's Alyssa. Yeah. Okay. Yeah. Yeah. Um, thanks. Um, so I have another insurance question for you. Wow. Day of insurances. Wow. All right. Hit us with it. Mine's about life insurance. So my husband and I were actually in disagreement on how much we should have. Okay. Um, so we're, and we're actually on the same page about most everything else when it comes to finances, but this one, um,

You know, so I'll just lay it out. Yeah. What does he think? Yeah. How much? Okay. So we both right now have 500,000 on each of us and he is completely fine with that. Okay. Um, and I used to be, but then I've been listening to you guys a lot more and now I know that it should be 10 to 12 times our annual income. That's right. Um,

And so we're just not at enough. And he is like, not about it. Well, this makes him wrong. And this makes you right. Well, yeah, I agree with Ken. And let's talk deeply about it. The purpose of insurance is to, if something, God forbid, were to happen to either of you, anybody that's dependent on your income, they will be set up, right? And it's not just for the moment, it's ongoing. And so what's your income and what's his income?

So mine's right at about 100 and his is about 130. Okay. So yours is at 100, his is at 130. So if something, God forbid, were to happen to you, he's got five-year salary, basically. Okay.

But you're saying, hey, I'd love for this to be even better. I'd love for you to be that. If we do what I'm saying, which is you'd have, you know, over a million dollars of coverage. 2.5 is what I'm recommending. I'm bumping it up. Okay. Yeah. Okay. Because you got them at 230 combined income. Yeah. But I'm saying individual policies. Right. I know. But my total is going to be 2.5 between the two. Yes. Exactly. Exactly. But if something were to happen to you, like for you to be able to provide 10,000

10, basically 10 years of your salary to him. What a great gift. I mean, that allows and vice versa. So what's the difference? Like he's probably thinking about quarterly payments or monthly payments. What does this look like? Have you priced out the numbers with Xander? Yeah, actually I did. And so, yeah,

Basically, like he thinks it's a waste of money. And honestly, we probably would have none if it weren't for we're in the military. So we have to take that 500 each. And so thank goodness. But and no, and he does have a point. Like he says, you know, like if if one of us were to pass the other one, you know, with that 500, like could easily pay off everything. And then we each make enough to like, you know,

you know live our with our daily expenses so I get it but I was telling him because I heard you say actually not that long ago and it kind of made me like really look into this and like be like wow I never thought about this before because we'd always had that same mindset as like he has now but you said you know the intent is that if they pass it's not just to like oh here pay

pay off your debt and like not a retirement plan. It's like, hey, invest this. And then the interest should pretty much make up for the income that you're losing. And I was like, oh my goodness, that makes so much sense. So I really want to do it. Yeah. But he is like, no.

And he just doesn't, he thinks it's a waste of money. And of course, like he jokes when I mention it and he's like, you know what, I'm not going to die until we're way older anyway. So it doesn't even matter. And I'm like, well, I love your confidence. That makes me a little uncomfortable almost. I think he's uncomfortable. I think, I think the whole, like you said, it's the 500, it's part of work, it's required. So in many ways for him, that was a no brainer. But when it's time to actually

turn on the, you know, turn on the lights in his brain and start thinking about it. It's an uncomfortable conversation. You're talking about what happens when you, you know, kick the bucket and that's not exciting. I'd flip this on him. I think he's a real cavalier about this. I think he's too cavalier about it to be completely honest.

But, okay, play it his way. Go, all right, I did the numbers. I ran the numbers. Got some quotes from Xander. Let me show you the quotes. And since you're okay if I die just living with a 500, turns out I'm okay with that too.

But tell you where I'm not okay. If you die early, Sparky McGee, I don't think 500 is enough for my safety gland. And I got some numbers I ran. And I'm pretty much telling you...

But we need to do this. I'm not asking your permission. I'm just getting you to buy in from my piece of mind. And I'd lay the real numbers out, which, by the way, I'm just curious, what would the total increase be year over year with the numbers you got from Zander? I'm just curious. I want to know, too. So, yeah, and actually, I was really impressed. So I did a quote on just mine for another $500,000 because that would put me at a million. Perfect. And that's only going to be like $600,000.

$17 a month. So I go back to Sparky, and I'm sorry I'm calling your husband Sparky, but he's kind of irritated me a little bit, and I'm trying to be nice. I'd go back to him and go, hey, listen, I know you're good with the 500K. If I kick the bucket early, I'm not. I just bumped it up to what this guy Dave Ramsey's been teaching for decades, and it's $17. I mean, come on. That's one drive-thru. That's one time-through.

the drive-thru for the month. Yeah, that's two Starbucks, you know, come on. So I would just present it that way and say, I'm doing this. Yeah. Oh, by the way. We do have to agree on everything. Like that is something that we persist in. Oh, I know, I know. I'm having some fun with this. I'm not, but we're also talking about $17 a month. I don't think this is a knockdown drag out is my point. Is he being stingy? Are you guys still in debt? Is that why he's being kind of

Tight with the purse strings? Okay, yes, we are. We do have debt, but it is not out of control. Okay. Is he super tight? Yes. Oh, yes. And the thing is, it's not that I don't understand it and I value it and everything, but I just think that he thinks it's unnecessary, so we are not about unnecessary spending. And I would get in... No, we're completely covered. He is like, oh, no, you're...

You know, if the $500,000, that would take care of everything, and we both make enough income that, like, all of our, you know, monthly expenses are good. There's just no reason for it. But let's go back to the basics of this. We need to – and this is what you tell him. And, hey, play the call. Like, this is documented. Oh, I can't wait. Sorry, man, for calling you sparky. So here's the thing. Let's go back to the basics on this because when we –

What we teach here, right? The baby steps and getting out of debt. The whole entire purpose is to change your family tree. It's all legacy built at the end of the day. It provides peace now, but it's also providing peace for the future and for the people that come after you. And such a huge part of that is insurance until you can self-insure because we're building wealth, not just for us, but to be able to pass down. And until you can self-insure,

depending on insurance companies to help you with that is such a huge part of the wealth building process for you. Because again, I hope you guys live until be as old as Methuselah. I don't care. Live as long as you want. But if for some reason you don't, this is here. It's kind of just that fail safe that kicks in and to spend a sparky,

Marky Mark, Biff, whatever your name is, to spend the extra $17, bud. It's $204 a year. It's $204 to make sure your family has half a million more. By the way, for your peace of mind, I keep playing that card. I was having fun with it, but I'm not joking around. He's tight. Play to that. Go, you're tight because you're fearful about money and stuff, and I appreciate that. There you go, Ken. But guess where I'm tight?

I'm nervous about this. And it's $204 a month. So you know what? Yes, we got to be in agreement. I'd say, Sparky, it's time to have a new budget meeting. It's like calling Congress back for a special session. We're having a special mid-month budget meeting. And I am going to find $17 a month to make sure that I'm not stressed out when you die early because you drink too much Diet Coke.

Or whatever. Sorry, Diet Coke drinkers. You mean sorry, Sparky. Sparky. We love you, Sparky. We want the best for you. We do love you. Help your wife out, dude. Come on. This is the Ramsey Show.

Welcome back to the Ramsey Show alongside Jade Warshaw. I'm Ken Coleman. Phone number is 888-825-5225 to get coached up. The Ramsey Show question of the day is brought to you by our friends at Y Refi. Y Refi refinances defaulted private student loans that other places won't touch and gives you a low fixed rate.

loan built just for you, Sharice Kay. She took advantage of this and lowered her payment from $2,000 to $680 a month with YRefi. So you need to go to YRefi.com slash Ramsey today if that's you. And you can learn more there. That's the letter Y, R-E-F-Y dot com slash Ramsey. It may not be available in all states. All righty. Today's question comes from Andy in Delaware.

My fiance had a lot of debt related to a prior divorce. She's currently living with her parents and her parents used a little cash and 10 credit cards to pay off her debt. So now she owes them close to $75,000.

I know legally most of this is not in my fiance's name, but morally we owe it together when we get married. I didn't agree with how her mom put this debt on credit cards and it doesn't sound like they are paying much more than the minimums right now. My plan is to take out a personal loan after we get married to pay off her parents in full so I have control over the debt completely. This would drop down the interest significantly. We could then attack it

with both of our incomes to pay it off as quickly as we can. Would this work or is there a better plan? Okay. So just to clarify, there was a divorce. She had debt. Her parents said, we'll take care of it, but we're doing it with credit cards. And you're like, no, when we get married, we're going to take out a personal loan to clear it. Um,

I don't necessarily like that method. I like that you're saying, hey, after we get married, then we'll tackle it together. That is right. So green check on that. I would not do the loan. The truth is you're only on the hook for the $75,000. You're not necessarily on the hook for...

Any interest that is in crude because of their method of paying for this, that part is on them because they chose that route. They chose that card with that interest rate. Unless there's a conversation that I don't know about, in my mind, I'd be like, I owe you $75,000. Ken? I couldn't agree more. It's a lot easier. They've already assumed this debt for her. This is not something that...

She put on them. They did this. I would pay the parents directly, and I agree with Jade. I wouldn't worry about the interest. That's their problem. I think they'll be thrilled that you guys are serious about paying it off, and I think it's a lot easier to pay them off. Now, I would only say the caveat to that is you both need to agree, you and your fiancé, that we aren't skipping this. We're going to treat this like it is a private loan, like our credit would be affected, like they'd come after us with collections, all of the things that people that loan money—

put in place as some sense of accountability. And I think that's the key or else this could create tension. And I don't think that's the case here. I think, I think, I think this is like, we want to get this out. I love the urgency, love the character and the integrity here, but I agree with Jade a hundred percent. Pay the parents directly. Here's the problem I do foresee is that he, he's already noticing, Hey, her mom put this on credit cards and this is him speculating. It doesn't seem like she's making payments.

So, or he says something there where, you know. They're paying the minimums. Yeah, they're paying minimums. So I do foresee a problem of down the line them saying, well, we did this, but it's, the balance has grown. So I do think you need to have some sort of really, really clear conversation about how interest is handled and how that part is not pertaining to you. And records, records, records. Records, records. I would treat every payment that's sent to the parents, however you choose to do it,

I would have that in a journal, a financial record. Your bank would easily give you that. I would do that so that it is tracked. Yes. If you have the conversation that Jade is recommending, and I agree. Because again, they could do something dumb with all that $75,000 and not pay off the credit card. But at that point,

Ain't my problem. And let it be known when Ken and I talk about you having this conversation, we really mean your wife, not you. You need to stay far from this conversation and let her speak for both of you because otherwise this could get grisly. Let's go to Detroit, Michigan, where Nick awaits. Nick, how can we help?

Hi, Ken and Jade. Thank you for taking my call. I had a question about having dual employment. Reason being was we have three boys, seven, six, and three. So we're in that messy middle. And I wanted to give my wife the opportunity to be a stay-at-home mom. She was a nurse to begin with. And then she was a nurse to begin with.

Once we had our third child, I just said, might as well stay at home. We cannot survive with my income. Now that she took advantage of her or she took advantage by herself going through her master's to get nurse practitioner. And she just completed the program. And you told her to stay home? Yeah. Hold on. I did. Okay. So, yeah.

Ken, you go ahead. I'm sorry. Go ahead. Keep going. Get to our question.

Yep, okay. So I work for a fire department and I make about $110,000 and then I also have a family business where I make about $100,000 as well. Obviously the fire is pension and then the family business is just straight salary. There is a simple IRA that I can contribute to. My question is, now that she has her nurse practitioner license and we have no student debt,

Am I crazy to leave my fire department employment and give up my pension opportunity and allow her income to supplement my loss?

And, you know, obviously strive to make more of the family business or do I just grind it out with both employments if I can manage it? All right. So how much is she going to excuse me? How much is she going to make as a nurse practitioner? I would hope about 140. OK, so 140. And the family business where you're making 100 right now, do you own that or are you working for another family member?

For my dad. Okay. And is that what you want to do long term? Let's go 15, 20 years from now. Do you want to be a fireman and be in the business or do you just want to be running that business or not in it at all?

No, and so that's the unique part is that in about five years, I had the opportunity to leave the fire department under a full pension or I'm able to be, I can pull out from the pension. I know, but I'm not, I'm not focusing on that. I'm asking, do you want to be long-term owner or involved in the family business? Yes or no? Yes. Yes. I mean, that's the dream. That's what you want, right?

Yes. Okay. So what would benefit you leaving the fire department right now? Forget the pension. I know you're all hung up off the pension. I don't really care about the pension. I'm not minimizing the pension, but we don't make decisions based on pensions. Okay. So my question is, if you leave the fire department, that's a certain block of hours every week, and you just focused on the business, would that allow you to do more and get paid more in the family business?

Yeah, there would have to be a discussion, but yeah, absolutely. I'd have the discussion. Dad, if I walk away from the fire department and I start full-time and I'm all my energy in here, what's that look like? This is very simple. Stop thinking about the fire pension, because if you walk away from the pension to make your life better in the now and the next, nobody cares about the pension. I want to know where does the stay-at-home mom...

who was going to be a nurse practitioner fit into all this because that was the thing that made me be like wait what what what sounds like she's back in right to work yeah no and that was the goal i mean she just wanted she that was her personal um goal was to become a nurse practitioner and okay being a stay-at-home mom it gave her the opportunity to just focus on school and nothing else so she's excited she's excited and to get back in and does she have a gig

She's currently seeking. Okay, cool. Okay, okay. Yeah, I walk away from the fireman position. You're only in it because of this pension. It's the only evidence you've given us as to why you keep doing it, and I just don't think you need to keep doing it. Now, you can if you want to, but if I'm trying to grow in one area, which is for you as a family business, every second I'm spending in the fire station...

is taking away from that long-term goal. And if your wife makes $110,000 and she's replacing the fireman salary, bingo, this is a no-brainer if it plays out the way that you want it to play out. Maybe wait until she gets the gig. I'm afraid to pull the trigger. Well, don't pull the trigger until she starts making the money and she's in. No, absolutely. Yeah, man, you got this.

That's interesting. Yeah, I was confused in the very beginning, but I also jumped the gun, so that's why I was confused. Yeah, you got a little fired up there. I know, I did. You thought that was going a different direction? I did, I did. Don't tell me what I can do. Is that what I heard? Yeah, yeah. I digress. She's a strong woman. Hear her roar, folks. Good hour. This is The Ramsey Show.

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The dynamo next to me is the one, the only, Jade Warshaw. I'm Ken Coleman. She'll take lead on the money calls and help you manage the money. And I want to help you make more money. So it's a good combo. Let's get right to it. We're going to go to Denver, Colorado. Peter is there. Peter, how can we help today? Hi, guys. Thanks for taking my call. You bet.

So I'm calling in because my wife and I are in baby step two and trying to get out of debt. And about a year and a half ago, I got my wife a horse lease started because she loved being with horses and working with them. She was at the time volunteering at a horse center for people with disabilities. So she got to...

basically just shovel poop and be around horses but didn't get to ride ever and I saw how much joy that was bringing her so I got her this horse lease what's that mean can you explain that more to me yeah I've never heard of that yeah so basically we pay $350 a month um and she can go out to this property and ride the horse whenever she wants um her myself and the kids actually um

So it's been a lot of fun, but I'm wondering if we're being irresponsible since we're in baby step two. Is it, can I ask more? I'm just going to dig deeper on the horse lease real quick. So is it, there's several horses on the property and she can ride any horse or does she kind of get assigned a horse that's like, that's her horse? Tell me more about it. Is it personal? Is it? Yeah. So we just have the one horse that we have access to. And how long is, how long have you been doing this?

About a year and a half. Year and a half. Okay. And the idea of her giving this up is met with what kind of reaction? Not great. A lot of tears, and she feels like it just helps her a lot emotionally. Yeah. Wow. How long would you have to give it up? I mean, how long is you guys' journey? Are we talking... So...

I don't. So we have like 21,000 in debt. I've got 3,000 on the last credit card. 5,000, maybe it's over 21. So 5,000 on my truck. And then I just got a personal loan for 15,000 to cover last year's taxes. Cause that was the first year we'd ever had to pay taxes. Okay. So you're at 23 now.

Yeah. Okay. So is that it or is there more? That's it. Okay. And what's the income? Sorry, Ken. No, go ahead. Make about $120,000. Oh, okay. So this is going to be gone in a year? You're going to live on $100,000 and you're going to knock this out in one year or less? Yeah. Shooting for like nine months. Yeah. Good for you. Can she work or does she work outside the home?

So she homeschools our three boys and stays at home. That's not what I asked. Can she work? She does sometimes. Doing what? I'm a trim carpenter, and so when we're done with houses, the general contractor that I work for will hire her to go in and do the post-construction cleanup. And what kind of money does she make, and how long does it take her to make this money?

It's very sporadic because it's just when we finish houses. So it could be like three right in a row or like the next one we'll have is maybe two months away. How much time does she take when she cleans? One to two, one day usually. One day. And so she's able to do this with the kids? Yes.

Yeah, usually we just have my father-in-law babysit. All right. I'm gathering information over here. I mean, I'd simplify it. I'd simplify it like this, and some people might hate this answer. Technically, if you're in baby step two, you cut out things like this. Now, you guys aren't.

you're not burning like some people are in debt and you could be if you choose not to go hard on this but you're going to be out of debt so quickly what i'd say is if you want to spend 350 and keep this horse lease up with this horse that you've probably established a relationship with just earn the 350 a month earn it back i was first of all i am shocked right now but i love it you

I thought you were going to go hard on this one. It's an amount of money that is truly not going to make or break them to that extent. Yes, but I'm with you. I want to make sure the audience hears this. I want to make sure that Peter hears this. I love this idea because that's what I was going to say. Go on it. Mama needs to go make the $350,000 or there is no horse. Yeah. She's got to cover the horse. But I do have one question on that. What's that? Peter, let's say it takes you nine months and all this is clear. Is that the number you gave us? Mm-hmm.

That's what we're shooting for you. What's the name of the horse? Jesse. Is Jesse going to be available for lease nine months from now? It's certainly not guaranteed. Is Jesse old? Well, that doesn't make any difference because if Jesse dies, we can't lease him anyway. I know, but I'm just saying maybe she wants to live out Jesse's last nine months. I'm going to throw a wrinkle into this, Peter and Jade. I'm going to throw something out and let you two discuss it. Okay. You ready? Yeah, I'm ready. I like your idea.

But I think the better idea is to go talk to Jesse's owner and tell Jesse's owner what the story is and say, nine months from now, we're going to be debt-free, and this is super important to my wife. I need to know that we can jump back into the contract and lease Jesse nine months from now, and I would take the $350,000, and I would help Mama get motivated to knock this debt out and say, we're going to stop riding Jesse for nine months.

Okay. I'm just throwing a hardcore alternative out there. Peter, Jade, discuss. So, Peter, are you saying that if you were to cancel the lease, are you worried about Jesse not being available and that somebody else would take the lease spot? Is that what you're concerned about?

Essentially, yes. Yeah, she could just lease her out to somebody else. Which is why I have the conversation with Jesse's owner. Yeah. Well, but if I'm the owner, if I'm Jesse's owner, I'm like, you want me to hold the horse? But how can she not lease him out to like 50 people? How many times can you ride Jesse in one month? I mean, you've got to be available.

So we're, there's usually only one primary. By the way, I should point out to people who just jumped in. Jesse is the horse. Jesse is a horse. We're talking about riding a horse. Yes. I should have probably made that clear. Yes. I'll refer to him as the horse from now on. Jesse the horse. So as not to confuse everybody. All right. But how many times can you ride the horse in a month? She goes out like once a month.

Right. Twice a week. Okay. Twice. Oh, that's a lot. Twice a week for $350. And I don't want to get too deeply into your business, but I did want to ask, cause you kind of alluded to it. Does your wife struggle with like some, anything mentally? Cause you said it helps her mental health.

I don't think it's so much like a mental health problem so much as just like she's with the boys constantly. She homeschools. Totally. And that's kind of like her. No need to explain. Yes, our children drive us crazy. She needs a little time with nature. Come on.

Okay. Listen, I think Ken's idea can't hurt. It can't hurt you to go by and say, hey, we've got a nine month window. We've been working with you guys for a year and a half. We love it. We need to temporarily suspend this and then we'll be back, you know, give him the date and time. If he says, yeah, say yeah. But if not,

Yeah, tell mom and be like, hey, mom, if you want to keep this going, you just got to fund it because we decided that our priority is paying off the debt. And so we decided that that's the priority with our current income. And I want to stand by that. And if you want to do something more. Go clean some houses. Mama got stuff funded. Go clean some toilets. Well, it doesn't have to be toilets. That's the last thing I'm going to. That's the last job I'm taking. I'm trying to make a point. She really wants to ride the horse. You got to pay for it. This is The Ramsey Show.

Hey, folks, our 4th of July sale is happening right now from July 3rd through the 6th. When you buy a sale book at full price, you'll get a second one half off. Grab the Total Money Makeover, Breaking Free from Broke, or even Smart Money, Smart Kids, all written to help you win with money. This Independence Day, celebrate your freedom with tools that help you ditch debt and money stress so you can build the future you want.

Visit RamseySolutions.com slash store to get started. You're listening to The Ramsey Show. I don't know about you, Ken, but I feel like the last couple of calls we've gotten have had something to do with protections. Yes. Making sure that an inheritance is safe, making sure that the money and the net worth that we've amassed is safe, making sure that my identity is safe. It all has to do with...

Insurance and everybody wants to have the right insurances. After all, insurance is there to mitigate risk, right? Whether it's health insurance, home insurance, renter's insurance, all of these things are out there to protect you in case a cost comes up that you yourself cannot cover.

cover your insurance is there to kind of fill that gap for you. And it can be very confusing to navigate all of the insurances and doing, you know, going through. I don't know, Ken, that is something that if we start talking about insurance, my eyes glaze over and I want someone to handle it for me. Yes, I would concur.

And so our Ramsey trusted pros, they shop the market and they compare all the insurance quotes so that you don't have to. And so that I don't have to. And your pro will compare the quotes. They'll look at the discounts and they will bundle the deals for you at no extra cost.

which is great. When my husband and I moved here, Ken, we were, you know, in a new house. We had to have the housing insurance for that. We needed to get the umbrella coverage and all that. And they shopped all the quotes. They rolled it into one nice, neat bow and we got more coverage for less money. Like that. I love that.

I love that. So Ramsey Trusted Pros will make sure you have all the coverage you need and nothing that you don't. So there's not going to be any fluff here. Ramsey Trusted Pros, they're interviewed, they're vetted, and they're coached to make sure that they're market experts. And here's the best part. They truly do have your best interest at heart. I've experienced that, Ken. I know that you have experienced that. So the question you need to be asking yourself is, do you have the right coverage for

Based on your individual needs. Okay. And so to do that, go to RamseySolutions.com slash coverage. Again, that's RamseySolutions.com slash coverage. And let me just add, because I hear it in the wind.

Insurance, guys, is not a baby step. OK, it's not something that you wait until you're after, you know, after you've paid off your debt or after you've saved up your savings to do. Insurance is something that you do the moment that you've learned about it. And so if you've been listening to the show for a couple of segments or even just this one segment and you're like, oh, you know what? I don't have life insurance.

That is your signal that you need to act on that today. Not once you've paid your debt off. Okay. If you don't have health insurance, check out health trust. That's the partnership that we have. You need health insurance today. If you're a renter and you don't have renter's insurance, this is your sign from, Oh, this is your sign. You need renter's insurance. You are out here with no coverage. Anything can happen. If you don't know, if you have the bare minimum of auto insurance,

You need to do our insurance checkup and make sure that you are covered because if you get in an accident and your coverage isn't what you thought it would be, you're about to be up a creek without a paddle. So please, please, please prioritize this in your every dollar budget. It is so, so very important to get the coverage you need today. Our Ramsey trusted pros will help you do that. All right, let's go to the phone lines. Tyler in Buffalo, New York is here. What's going on, Tyler? Hi, how are we doing today? Doing good. How can we help?

Hi. So I'm looking into possibly starting up a home inspector's business come this winter here, and I was just curious on what the right steps would be to do that. All right. So home inspection. Why did you pick that problem or that solution? What drew you to that?

I guess the big part that came out of it is the flexibleness. Because I have a job right now that's kind of seasonal. It pays very well with the seasons on, but then wintertime you don't have hardly anything going on. Okay.

All right. And what's the Holmes inspection business like in the brutal winters of Buffalo? I'm guessing you Buffalo folks, I mean, you just know how to handle that kind of snow. I mean, you guys were in the news last year during the football season, crazy snow. Is it a normal rhythm and there is not a big drop off in the wintertime in Buffalo as it relates to home inspection?

Nothing too crazy. At that time, I actually lived south of Buffalo and there's a lot of new builds going on. There's a lot of possibility for it. You have a background and some expertise, some skill set that lends itself to doing that well? I did plumbing for about five years. I've shat on an electrician. I've worked with carpenters. I've

When it comes to the nuts and bolts of it, I think I know fairly well. You got it. Trust me. You had me at plumbing. I mean, I was like, okay, you've got the skill set for that. You enjoy the work. It can be a pretty good business. I mean, you can build this thing to where it could replace your seasonal income. So I'm not seeing any red flags on this. How much is it going to cost for you to get qualified to do that? Is it a certification? No.

Yes. The bits I've looked into, you know, you can go online and file through a course, and then that right there is roughly probably about $2,500. $2,500? Do you have the cash for that? Yes. All right. I like that. So no red flag there. And is the market saturated? Is the market moderate as it relates to people out there that are your competitors? Or is there hardly anybody doing it?

In my micro area, there's two. And they, you know, honestly, the quality of the work they do is not very well. And, you know, it was something I actually seen an issue when I was working in the trade still. Okay. So you've heard this from viable sources that these guys or gals aren't doing a good job. Yes. And even seen it myself. Are they covered up in business or are they, what's their business like, the flow of business? Yeah.

So they seem to stay fairly steady, but at the same time, the exact grid, I'm unsure. What's your gumption level as it relates to talking to realtors, bankers, mortgage pros? Are you a guy that'll get out and connect and shake people's hand, look them in the eye and go, I'm the newest home inspector on the block, and I come from the trades, and I'm telling you my competition, they ain't so good, I'm fantastic, give me a shot. Are you willing to do that?

Absolutely. All right, Jade, I ran him through my questions. I turned the balance of my time over to you. You used the word gumption. I love that word. Gumption. I love that. The reason I asked that question, Tyler, is because this is a business where you, sir, are the product. That's right.

And Jade and I are in that same business. Jade's the product, I'm the product. So you got to have that gumption necessary to put yourself out there. And the realtors that you want to work with are going to be the type who are doing high volume because they're going to be able to give you a lot of work. And if they're high volume realtors...

They know how to talk. They know how to command a room. They know how to, you know, their BS level is very low. Right. So it's like this guy, you know, but if you come in there and you're like, listen, we need to work together. Here's why. I love that. So my question that I the only question I wrote down, which I kind of feel like that's what we're into now, is how do you get clients? Like, what's the strategy for you to go in there? Because it's not like you're trying to railroad anybody or, you know, you're not intentionally trying to like, you know,

steal anybody's clients, but at the same time you want the work. Does that make sense? So it's like, how do you see yourself getting in there and kind of pulling the boat close to the dock and getting those clients? See, that's one thing I'm kind of unsure of. I don't know really where to start with it. I wasn't sure if it's something you get in with the banks or you contact realtors or if it's just a matter of just talking to everybody you can to get your name out there. Okay, well, it's the list that I ran through earlier, but...

I would start with your mortgage companies in the area. They're the ones that when a house is going for a refinance or the actual initial financing, they are the ones that are getting the home inspector out. I know when I've refied, the company I refied with, they're the one that chose the – they have their guys and they get their gals. Okay. So for certain mortgage –

I would check on the realtor side. I'm going to say I don't know. I think that's more of a mortgage play. Okay. Because, again, the mortgage company are the ones, the banks, they're the ones that need to know what the house situation is. Now, realtors do it as well. I'm not saying realtors don't, but I'm saying realtors and mortgage companies, when they do refinancing, they'll have a – I'm sorry. I've confused the whole situation. Okay.

You're talking about home inspection. I apologize. I got in my head home appraisal. Sorry. Mortgage companies are appraisers. That's right. Okay. Home inspection is realtor. You're right. My brain just got all cobwebby. That's all right, Ken. I got the broom out. You're all swept clean. Appraisals. So home appraisers, that's different than the home inspector. So realtors, realtors, realtors. All dead. And hey, listen, can we tell them? Tyler, if I were you...

I'd start with the website, RamseySolutions.com, and find those pros. That's it. That's a goldmine right there. Start calling them and go, I called the Ramsey Show. I'm a big Ramsey listener, and you are a trusted pro. Can we talk? Can I help you? So that's where I would go. Look at this guy. Come on, Ken. I had to get the cobwebs out of the way first. It's what he does. It's what he does.

Thank you.

This is the Ramsey Show alongside Jake Warshaw. I'm Ken Coleman. The phone number is 888-825-5225. 888-825-5225. Let's go to Phoenix, Arizona. Jonathan is there. Jonathan, how can we help?

Hey, thanks for taking my call. Sure. I'm not quite sure where to start. To be brief,

I'm 24 with two kids of my own. My son has two kids from a past relationship. I am the only one that works at the moment, and it just seems like I'm always drowning. I come from a family that has never really been financially stable, so...

I don't even know where to start to begin to get out of this, like, drowning feeling. Yeah. Man, I'm so sorry. But can I just tell you real quick before we go into this?

I sense in you a guy who wants to change his family tree. I sense in you a guy who is busting his tail and trying to do right by those little ones. And I wanted to encourage you because I think you've got I think you've got a lot of character. And I love the fact that you're calling and asking for help. It's a big deal to go. I need help. And I want to I just felt like you needed to hear that. You're not a failure.

and you are going to be able to figure this out, and we're going to help today. You got me? Yeah. All right. A couple quick things here. I'm going to turn you over to Jade, all right? So we're going to try to do as much as we can in a quick amount of time. Number one, what are you doing, and what is your income? I work in the HVAC industry, and my yearly income is around $60,000 to $80,000 on a good year. Okay. That's not bad. So we've got somewhere between $60,000 to $80,000 gross. Okay.

And are all four, if I heard you right, you've got two kids and your girlfriend or fiance has, is your fiance or no? Yeah, she's fiance. Okay, I thought I heard that. Okay. Are you got all four kids staying with you guys all the time? Yes. Okay, so she's at home taking care of the kids. Yeah. Gotcha. Okay. And what kind of debt do you have?

We're in about $23,000 in a minivan. Now, wait a second. When you say we, did you both sign on to that deal? Yes, yeah, we did. And it's $23,000 on a minivan? Yeah. Okay, what other debt do you have? And then I have about, let's say, $1,600 in collections and credit cards, and then she has around, let's say, $6,000.

to a thousand in collections and credit cards. That's it? Yeah. You got any money in the bank at all? No, I did, but we had to go through it, hit some unfortunate times, so yeah, no, it's cleared out. What do you mean by unfortunate times? Give me 20 seconds on that. I lost my job, my last job, where it was great money, good work, and

I was able to save up around four to five grand. And then once I got laid off from that company, we had to use that to keep our bills. Was that HVAC work as well or something different? Yeah. No, it was HVAC. And you don't have to tell us, but was this something you did? Yeah. Did you learn from it? Yeah, absolutely. Okay. Okay.

So what that tells me, though, is that you have more income potential in that industry because you were clearly working for somebody else making more. What were you making when you were with them? About $96,000 a year. So what would need to be true for you to get back to that? Honestly, find a different company. But it's possible, yes or no?

Yes. Okay. I just want to leave that there. Yeah. Let's get to it. All right. I always like to kind of ask all the questions. I'm kind of like the general doctor and then she's a specialist. And so she kind of sits over there and she's like rubbing her chin. You filled out the paperwork for me, kid. Yeah, that's what I am. Let's be honest. I'm the intake nurse. That's not true. No, but I think this is doable, Jade. I do too. I like, I

I like what you just said about the opportunity to make more. And if I'm you, I'm getting on that today. Ken, what's the first step? Where do you go about that? It's a budget.

No, I'm talking about for him to find the job. Oh, sorry. I apologize. You see where I was at? You had already clocked out. Well, no, because they've not done it. They have no idea where their money's coming and going. That's the issue. Here's what I would say. Jonathan, because you're in the trades of HVAC, you don't have to stay at this current company for 10 years. I mean, you go to the best situation that you can go to. So I would be really, because you're stable now.

Now I'd be looking, and you learned your lesson from the last one. HVAC can make really, really good money, and so you're looking everywhere all the time until the next opportunity comes, and the minute it shows up, walk right to it. Love that. So that's homework number one is we're looking for that. Homework number two is you do need a budget. We're going to make sure you get set up with an every dollar budget. It's the best way to budget because you're going to see all the things that you're spending money on, and you're going to be able to pinpoint, okay,

Where is an area of concern? Where is an area I can cut back on? Maybe there's more at our disposal than we realize, but it's just been going out to things. I don't know, DoorDash, Instacart, whatever. So we're going to give you the budget. I also wanted to know, what's your living situation? Are you renting? Do you have a house together? Tell us about that. We're renting. Okay. And what do you pay every month for rent?

Just under two grand, so $19.80. Okay, that's a squeeze. I'm not going to lie. And I know you've got the kiddos, but you need to find something that's more along the $1,400, $1,300 area so that it's not squeezing you so much. Because you told me you make $5,000 to $6,000 a month.

And so assuming, you know, it's somewhere right in the middle. Yeah. Thirteen. Fourteen hundred is really your max. So I'd be thinking through what that could mean, because unless you see a pathway quickly to earn more money, this rent is going to continue to squeeze you. The van. What's the van worth? You owe twenty three. What's it worth?

It's about $21,000. Okay. I'd be looking at getting out of that and into something a little less expensive. Take a couple months and save up the difference so you're not upside down and get out of that van. Or go over to the credit union and say, hey, the van's worth $23,000 or I owe $23,000. It's worth $21,000. Can I get a $2,000 loan and can we add like $7,000 or $8,000 to it so that I can get something else? Jonathan, listen real quick to what she just said, okay? This is doable.

You bust it, go to a credit union or something, get a different loan, whatever we got to do. Pay this thing off because you're going to save yourself a lot of money. What's the car payment on that?

You guys don't want to know. Yeah, we do. We do want to know. I know. That's why I'm asking. $741. It's way too much. $783 a month. All right. So, Jade, tell him how to get rid of that car because that is a $700 raise instantly. This is the how-to. The how-to is the first place I want you to try to go to is a credit union because they're going to care about the fact that you're a human being. But

wherever you end up going to get this loan, I want you to get this loan. Okay. So what you're doing here is you have to pay $23,000 to get clear on this, but it's only worth 21. Right. And so you need to clear that $2,000 difference. That's what you're going to get the loan for. So that when it comes time to pay this off, you actually get the title, right? That's, that's, or you can give the person the title who buys it. That's what we're talking about. Okay.

But then you're without a car, right? And so the idea is don't just get the loan for $2,000. Get it for a little bit more, maybe $7,000. Start looking online tonight and see what can I get that'll get us from point A to point B. This is temporary. This is not forever. This might be for a year and a half until you can get, you know, later on, add some more money with it and trade up, okay? But look for an $8,000 car. Now you're in for $10,000 instead of $23,000. You see what I did there?

And now instead of paying $783 a month, if you can get in with a credit union with a better interest rate, maybe you're only paying $300 a month. You see what I'm saying? Yeah. So that's what we want to do with the car. With these credit cards and collections, let's settle them. Okay. And whenever you settle them, you're calling them up and saying, hey, I know it says I owe you $2,000. Today I can give you $700, take it or leave it. That kind of thing.

And you get it in writing first and they're going to settle with you. If it's already gone to collections, they will settle. But you're going to have to be like white on rice. Like you're going to have to be on them calling all the time because if you dealt with Betty before and Betty didn't do it, call back and talk to Shirley. And if Shirley won't do it, talk back, call back and talk to Heather. Somebody is going to do it for you, but you have to do your due diligence and stay on top of this. The good the only good news that comes out of this collection stuff is that you're going to end up paying it for a lot less.

but it's going to be at your expense as far as the effort goes. Yeah. Jonathan, you can do this. Hang on the line. We're going to get you in every dollar. Please just start plugging the numbers into this thing. It's so intuitive. It's so simple. And it's a game changer because you will now know where your money is going. Yeah. And that is half the battle. What Jay just did for you is a huge victory to get out of that car payment.

and on the path to building prosperity for those kiddos. You can do this, Jonathan. We're here to help. This is The Ramsey Show. Welcome back to The Ramsey Show alongside Jade Warshaw. I'm Ken Coleman, 888-825-5225 is the number. Our scripture today comes from Hebrews 4, verse 16. Let us then approach God's throne of grace with confidence,

so that we may receive mercy and find grace to help us in our time of need. I feel like that should be the verse for all budget meetings. Yeah, you're probably right. Let us approach this budget meeting with grace and confidence so we'll receive mercy. That's pretty good. And our quote of the day from Mark Twain.

A man cannot be comfortable without his own approval. Classic. The man was deep. Wow. He would have owned Twitter if it was a thing back then. That's got a lot of depth to it. Good stuff there. All right, Paul is joining us now in Edmonton, Alberta. Paul, you are on the Ramsey Show. How can we help? Thank you so much for taking my call. How are you today? We're good. How can we help you?

Um, so I recently got a raise at my job. Um, I doubled my salary. Uh, I just needed to quickly Google, um, my currency. Uh, I make 37,000 us a year. Um, it's not a today purchase, but down the line, the reason I called was, is it worthy and a worthy investment to purchase some farmland and then lease it to farmers as like a

I don't want to say passive income, but like as another source of income. All right, before we answer that, I'm guessing you've done enough research to answer this question. So give me an example of some acreage and how much you could lease it for to a farmer in this scenario. What kind of real revenue are we talking about? Have you run the numbers?

I just only heard about this kind of format through some of my friends. They worked with farmers in the past, and then I had another friend that leased their farmland to farmers. So it's kind of been a short thing that I got introduced to, so I wouldn't have that number. All right, so you get my point in asking this question? Before we get to the financial side of this, there's just this good old-fashioned common sense thing.

And so it's like somebody saying, should I buy a business? Well, we want to look at your financial situation and we're going to dive into that. But we want to also go, what's the business? And does it have viability? And have you done a business study? And so in this situation, this will not be hard for you, but you need to go become an expert in the numbers. In other words, it's got to be this amount of acreage and then based on that, and it's got to have this kind of soil quality. And then based on that. And you got to be able to buy it.

Well, you know, we're going to get to that part. But I'm just saying, like, even if financially you can do it, which you're going to coach him on, I just wanted him to know, is this an actual –

smart investment, even if you're in position to do so, which I don't think you are. But that's my little quick warning. I want Jay to jump in on your financial situation. And I'm getting in Ken Coleman territory here. I don't sense that it's necessarily something you'd be passionate about. It sounds like something you just heard some folks doing. That's a good point. And it's like, oh, maybe that can work for me. And I think that could also be a bit of a, at least an, I'll call it an orange flag. And can we also say real quick, there's no such thing as passive income. No.

It doesn't exist. That's a lie. Yeah, for sure. So back on to the other side, if we do, let's say let's just pretend for for I can't say what I was going to say. Let's just pretend that you had vetted this out and you had some numbers. OK, and you said, yeah, I've looked into this. I can make X amount of dollars. Then my next question to you would have been, OK, what's it cost to buy these acres of land?

And then if you would have said, well, Jade, it's going to cost me $400,000 to get the land, because I need at least this many acres. And I would have said, okay, how are you going to pay for it? And so I think that's where we get into the numbers nitty gritty of this, which is you're making $37,000 a year. I would never tell you to invest in $400,000 and go into debt for it. I

I would say the first line of your investing needs to be you investing 15% of your income and that's steady and that's like your kind of country road of investing and then on down the road. If there's other things that you're interested, like real estate or land, that sort of thing, I would say, listen, the idea is to pay cash for it and that's really, really, really the best way to purchase land and real estate is in cash. So I like that you're thinking about more ways to earn money. I like that you're kind of creative in what that could be. It's not just...

I don't know, kind of the typical route, which is cool. But I think that you have a lot of work to do and a lot of study on this. It was never something that I was going to put like a, like be in debt for. It was always going to be something that it would be a cash transaction, but that would be like 10 years. Like, it's not like something. I don't have that money today. I don't

I don't have that money today. I love the question. It would just be something that like, you know, given with the recent bump in income and then like I've been already investing on the side and whatnot. Okay, good. Yeah. Paul, I was just telling Jade this during the show breaks today. I'm kicking around an idea. A friend brought me an investment opportunity. I've never invested in something like this before.

And I am doing a lot of due diligence. I've had some really smart guys that have done things like this before that are my friends. And I'm going, take a look at this. What questions do I need to be asking? So the advice I'm giving you, I'm actually taking and I would never want to make any kind of investment. Yeah. That I even what's this is what we teach, by the way, in mutual funds. We want you to sit with a smart investor pro multiple people, right?

who do you connect with? Chemistry. Do they have a heart of a teacher? Do you understand what you're doing so that you can make your decision? They're not telling you what to do. You are telling them what you'd like them to do with your money. And so this thing on farmland, my advice is just do your homework and know it inside and out. Know what the risks are. Know what the upside is. And so that when the time comes and you've got cash,

You're ready. And you can do it. So really appreciate the call, young man. I love the forward thinking. Let's get in one more quick call. Andrew is joining us in Indianapolis, Indiana. Andrew, how can we help? Hey, thanks for taking my call. You bet. We've got about three minutes, so make it fast.

All right, I'll make it quick. I just wanted your guys' opinion on giving, say, friends or family financial advice. I was approached by my mother-in-law, gave her some advice. She's kind of thinking about taking it. Mother-in-law? Well, the key is that she approached you. My answer is don't give it unless they ask for it.

Well, and she did. It seems like a no-brainer based off what I've learned from you guys, and I absolutely appreciate that. But part of me is going, well, if she does it and doesn't do it right and it doesn't work out, then she comes back to me and says, hey, you told me to do this. Listen, that's our job every day, Ken and I. Yeah, but it's interesting that you say that because the advice that we give on here, if somebody does it the way we tell them to, then we're not worried about something. So what was the advice that you gave her?

Well, she's got a, she's paying a car payment and miraculously somehow, I'm not sure how she timed it just right. She's got a lot of equity in said car, but also has about the same amount of credit card debt. And,

And she doesn't really drive much. And the numbers are there to make it work to sell this car, pay off the credit card debt, buy a $4,000 or $5,000 car to do the minimal driving that she does, and then pile up that money to maybe buy a better car or work on her mortgage. The only way that doesn't work out is if the $4,000 to $5,000 car she buys is a lemon. So this is where you as a son-in-law can get massive son-in-law points and go, hey,

I will do the legwork or help you get a mechanic who would be willing to see said cars and don't buy any $4,000 to $5,000 car that the person won't let you take it to the mechanic. And you just walk her through that and guard. I just don't see how that turns out bad. Do you? No, I don't. I really don't. It's really up to how they work out the advice and if they take it to the letter and to the T. Okay.

Yeah, and that's where we're struggling. She keeps sending me links for cars that are like $8,000 or $9,000. I say, you can't afford that. You need to lower your budget. I mean, the hard part for where you're sitting is, again, if they've asked for advice, you offer the advice. And then after that, there comes a time where you do kind of have to go, okay, now my hands are off of it. If you choose to do it, great. If you don't, if you need help, I'm here to help you. But what I'm not going to do, and I'm going to say this very carefully because we're on air, you cannot...

For people asking for advice, you cannot be what I call an ask-hole.

Boy, I'm glad you slowed that down. Because an ask hole. Not you. Is there a person who asks the same thing over and over and over to avoid actually doing? Okay. And that's annoying. And so if you feel like it's getting to the point where this person is being an ask hole. See how I stepped in there? Then you go, okay, I've given you the advice. It's up to you what you do next. I like that. I think that needs to be your next little product. Yeah.

I think it needs to be some type of a money bumper sticker that you sell, Jade, in your store. A t-shirt. I think a lot of people would like to wear that. I'm afraid to say it because I know I'll mess it up and the FCC will not be happy. We hit that K pretty hard, too. Oh, we did. Hey, thanks for the call, Andrew. Thank you, Jade, for always being awesome. Thank you, Kelly and the team, for keeping us on the air. Thank you, America. This is your show. This is The Ramsey Show.