You Can’t Borrow Your Way to Freedom
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From the Ramsey Network, this is The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm George Campbell, joined by number one bestselling author Rachel Cruz, who's also my co-host on Smart Money Happy Hour, another show on Ramsey Network, and we're taking your calls at 888-825-5225. Amanda's going to kick us off in Tampa, Florida. Amanda, welcome to the show. Hey, good afternoon. Good afternoon to you. How can we help today?

Okay, so I have one of them huge car payments. It's about $900 a month. I owe $34,000 on it.

It is a 2022 BMW. So my question is, it's only valued at $34,000. The auto trader value is $25,000. I would get about $2,000 back in warranty, warranties if I sold it back to the BMW dealer. I have $10,000 in my savings account. So my question is, should I get rid of the car? Because it's kind of hurting us financially paying a

a car payment that high. Yeah, for sure. I mean, 900 bucks, that'd be nice to have, right? Versus it going to a car payment. Okay. So you said it's valued at, I think you said it's valued at 34,000, but then you looked on auto trader and it's a 25,000. Yes. So I owed 34,000. Oh, okay. I'm sorry. I got you. Sorry. I owe 34. Um, it's valued at 25, uh,

Is that like trade-in? Have you? Yeah. Okay, you don't want trade-in value. You want like a private party value. You can check on Kelly Blue Book for that. That's going to be much higher, and that might get you closer to where you're not underwater on this thing.

Yeah. So let's say it gives you like $5,000 more just for the fun of it. Okay. So that means we'll just say $30,000. You owe $34,000. So yeah, I would take $4,000 out of your savings so that it's, you know, you can like after you sell it right that you can pay off the remaining of the debt, get the title to the new people and you're done free and clear. And then just, I mean, I would just go buy like a $5,000 car, the rest of your savings, leave $1,000 in there.

Okay. I actually have an extra car, like my luxury car. So I do have a beater. Well, there you go. God bless America. Our cars have cars in America. Well, then there you go. Well, so now you don't have to. Yeah. So you don't have to you don't have to spend it. And you guys have 10 grand. What other debt do you have?

Okay, so I'm pretty, the past month, like, I've canceled, like, I've changed phone services. I got rid of the internet. I got rid of streaming. Wow, good for you. I changed my homeowner's insurance. I paid my car insurance for six months. So I have $190 in a home, and my home is worth about $650. Okay.

Um, and then I, I do have what I'm trying to work on is my 14,000 in credit card debt. Okay, perfect. Well, what's crazy about this, you know, all of this math that you have, yeah, you'll only have $5,000 of credit card debt left because you'll put nine of your savings towards it. Okay. And, um,

Yeah, you'll be you'll be doing great. And that's if you're not over water. That's right. You will have to put yeah, you may have to put four thousand. But if you could sell exactly what you owe, if you check Kelly Blue Book and you can get private party value, thirty four grand, I would do that. Get as much as you can get top dollar for it so that you're not having to dip into savings. And then use nine of the ten to knock down your credit card debt. And then you're going to be debt free in a few months. What's your household income?

Um, so I just took a lower paying job as a school teacher. So our household income now is $5,000. That's not... A month. It used to be about, yes, it used to be $8,000 and now it's $5,000. And is that after taxes and everything? Yes. Okay, that's what you're bringing up. And is this two of you? Is there another person involved here? Yes. Okay. And what are they doing for work?

Um, my husband's a contractor, but as of right now with the changing, um, the changing market, he may have to actually look for, for more work. There's not enough contract to work for him? Um, no, due to, uh, interest rates, he builds homes for a living. So people aren't building homes right now with the interest rates being so high.

Are there other contracting gigs he could do? Does he work for a builder? Actually, right now he's working for a small mom and pop builder in his trailer park this afternoon doing like carpentry work. So he has been trying to find other little side hustles.

I just feel like contractors are in high demand. You can't find enough of them that do quality work and show up on time and charge a reasonable rate. And so he should be able to find stuff outside of the new build world to keep him plenty busy to get this income up because he should be making 5K a month on his own. Yeah. Without your salary. Are you guys able to live on the 5K, Amanda? Yeah.

um yes because i've cut like i said i've cut so much like the car wash and well for him i mean he needs to be working 40 hours somewhere to be bringing in money for you guys to pay off the set and get a good emergency fund in place so even if it's not contracting he doesn't need to be just sitting and waiting on jobs i mean yeah i know go do something you know what i mean well he's listening so you tell him oh good okay he's pretty handy what's his name

Ray. Hey, Ray. Ray, listen, I pay handymen really good money. I'm talking they can charge now anywhere from 50 to 100 bucks an hour. And George doesn't know how to do anything. And I don't do. Lots of Georges in America. They don't know how to fix anything. The only squats I'm doing are diddly. And so he can get out there in your neighborhood, get in the Facebook page and just say, hey, I'm doing handyman work. My rate is 75 an hour. And that's equivalent to 150 grand a year if he's doing that full time.

Yeah. And so I believe in Ray. I think he needs a little pep in his step. And now's the time to really put your foot on the gas, clean up the debt, get a fully funded emergency fund. Then we have the luxury to choose what kind of jobs we take. But right now we need money coming in. Yeah. And getting rid of this car, Amanda, is going to free you guys up a lot. I mean, $900, that's a fourth of your take home pay is going on a car payment. It's the same as my home mortgage. What an American story, George.

We pay as much for our car payments as we can.

Payments as we do our mortgage payment. Well, Amanda, well, I'm glad you called. I hope that helps just to kind of get this ball moving for you guys. And again, any extra income is going to help. But you guys are doing well. I mean, the car's got to get out of here. And then $900 is freed up to put on the debt. And then if Ray is the best handyman in town, he's been making good money. I just feel like it's an untapped market. No, it is. You know, it's wild, though, Amanda and Ray, if you're listening. So even in our neighborhood, you know, there is a recommendations thing.

Group Me, like a specific group just for recommendations just within our neighborhood. And the amount of recommendations we get for plumbers, electricians, I mean, you go through the list of

of things that people are asking, hey, do you know someone that does this? Like it's out there. People are willing to pay for it. So I have a really embarrassing story I'll share, Rachel. This happened this week that my the lights and plugs in our master bedroom just would not work anymore. And I tried everything. I flipped off. I flipped the breaker. I was Googling things. I was texting. So finally, I had an electrician come out and I said, what's your rate? I always ask him the rate ahead of time. They said one hundred twenty five an hour.

They show up to the house, these two guys. I got to make sure I don't spit it out. Is it the five minutes later? They go, all right, we fixed it.

I said, what'd you do? They said, we just flipped the breaker. I said, I flipped the breaker. They said, yeah, you got to do it harder. I was like, how hard can you flip a breaker switch? This is insane. I don't know. So you didn't turn it off all the way. It's basically what the... I flipped that thing dadgum 17 times back and forth. I was angry with it. Do you sometimes have to let it pause?

And like let it sit there for a little bit? They had, I don't know, Excalibur's magic sword. I don't know what happened, Rachel. But anyways. Ray, are you listening? I got the invoice. There's Georges out there. $125. Don't have the breaker. These guys are making $1,000 an hour at this rate. They spent five minutes at my house. Yeah, then they're going to go to the next George Camel. Let's go flip some more breakers. We're going to become Baby Steps millionaires off of idiots like this. This is The Ramsey Show.

Hey, when you're gazelle intense, you sell so much stuff the kids think they're next. But when you've gotten rid of all you can, save money by switching your cell phone plan to Boost Mobile. It's just $25 a month for unlimited talk.

Welcome back to the Ramsey Show. Tonight...

This is April the 21st.

John Deloney and Dave Ramsey are kicking off the Money and Relationships Tour. Is this the first night? The first night. For the tour. We've been talking about this forever, and it's finally happening. So if you're in Louisville, they're happening tonight, April 21st. Go check it out. Durham is happening this Wednesday, April 23rd. Atlanta this Friday, April 25th. And here's what they're doing. They're going to be doing some improv, talking about money and relationships, helping you break patterns that have left you stuck.

breaking the cycle and you get to choose the content before the event begins and then they'll be riffing on it all night long unfiltered and it's going to be a great time so check it out louisville durham atlanta that's this week and then they'll be coming to phoenix fort worth and kansas city the first and second week of may kansas city sold out for fort worth is not far behind so get your tickets today to see dave and john live ramsey solutions.com slash tour or click the link in the show notes and description jessica is up next in milwaukee what's going on jessica

Hey, how are you both doing? Doing great. How can we help? So my husband and I just started Financial Peace University a couple weeks ago. Awesome. How's it going? It's going really well. We are a one-income family, so realized our income wasn't quite where I needed it.

So I did pick up a side gig as well. Good. What is it? So my question, I am driving food delivery. Oh, good. That's great. Through one of the apps, like an Uber Eats or DoorDash, one of those? Through DoorDash. Okay. So it's my first time being a 1099 employee. So my question is, how do I budget so that I'm not setting myself up for failure come next tax season? Great question.

The easiest way to do this to just kind of muscle memory is just force yourself to put a third of whatever you make into a savings account. And that way you'll have the money set aside for taxes. Okay. So if you made, let's say, $100, you're going to take $33 and just transfer it to savings.

Okay. And then what you'll do on top of that to make it even easier and avoid stress and avoid a big tax bill is make quarterly estimated payments on the IRS website. That's what I used to do when I would do side hustles. And basically you're just estimating what you're going to owe in taxes and paying the IRS ahead of time so that when the end of the year comes, you've already paid most of your taxes, if not all. Does that affect my full-time employment? No.

Would that make would that change that at all or would you still do the quarterly payment? You'd still do quarterly payments because you're not being taxed on that 1099 income versus your full time employment. They're taking taxes out already. They're withholding. OK, so that's the big difference with 1099 folks is no one's paying the taxes for you. No one's withholding for you. You've got to do it all yourself. And that's where this kind of savings account quarterly estimated payments plan comes into place.

Sounds good. That's what I needed to know. Awesome. So great. Thank you so much for the call. Way to go doing whatever it takes. I know. I shared on Smart Money Happy Hour, my Instacart side hustle. Yes, you did for a weekend. What a struggle that was. They're hard workers. I think I did seven trips and it felt like a thousand. Just so much. Will this ever end? So God bless all of you out there side hustling. Tip your people well. If you're out there using these apps. That's why I was shocked. You're coming back and saying people didn't tip. I went to some real wealthy neighborhoods.

Around this part of town, Rachel, $3 tip. I mean, that's pretty unbelievable. I had gallons of water I'm delivering to the door. Three trips back and forth from the trunk. What a physical labor. All for $3 tip. I don't think that's right. And the trips, they don't pay you much in these apps. They'll tell you ahead of time, hey, you're going to get $6 for this trip plus tips. Yeah. So make it worth it. Yeah. An hour of my time for $9? Yep. Get out of here. Get out of here.

All right. Next up, we've got Rachel in Milwaukee. Rachel, meet Rachel. Hello. Hey, you're breaking up on us. Can we hear you? Can you hear me? There we go. There you are. What's going on?

I have just over $250,000 in debt. And I recently received a summons for medical debt. So I did speak to a few attorneys and they're all suggesting bankruptcy. I've listened to you guys long enough to know that that's usually not a suggestion. I'm just kind of curious as to where I go from here. Is all $250,000 in medical debt?

No, about $61,000 is medical debt. What's the rest of it? I have about $27,000 in credit cards. I have $6,500 in a car loan, $13,000 in a personal loan. I got $78,000 in private student loans and $65,000 in federal loans. In federal loans, okay. Yep. So over what? So $140,000 of it's student loans?

Pretty much. Oh, man, Rachel. Okay. How much are you making a year? I would say I make around 78. So I have to check probably like 60, maybe 59. Okay. You're kind of breaking up, Rachel. Yeah. I want to make sure we get these numbers right. Okay. So after taxes. You're bringing home about five grand a month.

I'm so sorry. We're having a hard time hearing you. We'll see if we can clean up your line and get you back on, Rachel. But looking at these numbers, bringing home $5,000 a month, I don't know that you'll even be able to make your payments on these debts. And the only one that you could really clean up fast is getting rid of the car loan if you're not underwater on it and you can use the proceeds to get something else. But that only cleans up $6,000 out of $250. I know, out of the whole thing. So it may not even be worth it.

The medical debt, I'm wondering if they'd be willing to settle. You'd probably need to get on some sort of payment plan. And same with the credit cards. I mean, the $27,000 in credit cards, I would, if you are defaulted on any, Rachel or behind, call those first and ask them for a settlement. Or if you have any extra, like if you had a bill, you know, a $6,000 credit card,

Just pretend that you were behind on, and I don't know what your savings situation is, but even if you had three grand, half of it, call them and say, hey, I can settle today. And as you do that and save up a little bit, most of these credit card companies, especially if it's in default, they actually would settle, sometimes pennies on the dollar, depending on how long it's been not paid. So yeah, the medical and the credit card is probably where you can do the most negotiating options.

Gosh, the student loan, $140,000, I almost would put that on hardship deferred. I wonder with the medical stuff, if you're able to do anything there. I'm just trying to get you to a place where you can get at least stability of just the payments before even looking to attack it. Because to your point with all of this, I don't even know if she's making enough for that. Let's see if your line's cleaned up. Rachel, are you still with us? I am. Okay. Do you have anything in savings?

I have about $1,200 in savings. Okay. So that's your baby step one. You've got that covered. And you're just solo, right? You're not married? Correct. Okay. And what are you doing for a job? Like what was your degree in? I'm a nurse. You're a nurse. Okay. What type of nurse are you? I'm an LPN. Okay. Could you do like travel nursing? Travel nursing?

I could, but according to their ads, in terms of pay, it's not much different. Oh, no. Every travel nurse that calls the show is making like $250,000. Yeah, I mean, they're making insane money. Insane money. So, Rachel, I would be doing your research.

hardcore into that because in the meantime, take as many shifts as you can. Yes. Cause I was so, I'm so glad you're a nurse because that gives such a range of possibilities of what you can be making. Um, and, and, and I'm thankful that that's the case because yeah, some of these, these travel nurses, man, they do it for two to three years and they make so much money. It's wild. So, um, no, I would be researching into that heavily because that's, that's going to be the biggest thing, Rachel, to get you out of this is the

The income side. And again, that's the positive of your situation is I think that it is out there, whether it's working overtime, like you're saying, George, or just finding a new line of work within nursing that pays more. Yeah. But that's going to be your, yeah. I mean that you're going to find more money doing that, Rachel, figuring out how to work overtime than doing like Instacart shopping, like what we were just saying. So you are qualified to make a lot of money in extra, in extra time. So if you're working an extra few shifts, you're,

Yeah, that's going to bring it up. And so that's going to be it, Rachel. And so it's going to be knocking out this debt, smallest to largest. And again, seeing where you can settle and you'll probably be able to settle the most with the medical and the credit cards. And the longer they've been in collections, the more willing they will be to negotiate and settle. But first, cover your four walls, food, utilities, your housing, your transportation. You pay those before you pay anybody else. If there's money left over, we can throw some payments their way.

I'm going to set you up with a financial coach on us, Rachel, to walk you through all of this. So hang on the line. We're going to get you connected to a Ramsey preferred financial coach who can walk with you. So sorry you're going through this. This is The Ramsey Show. ♪♪♪

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50%. That's simplisafe direct.com. There's no safe like simply safe. Hey, if you're enjoying the show, do us a quick favor, hit the subscribe or follow button, wherever you're listening or watching, leave us a kind review, share it with a friend. All of that helps us reach more people with this message. We appreciate you guys. Ben is up next in Cleveland, Ohio. Ben, welcome to the Ramsey show. Hi guys. How are you guys doing? Doing well. What's going on with you?

My wife and I just purchased our second home, and we have closing in about 30 days. We have the means to pay cash for it, but our financial advisor is telling us not to. I've been listening to you guys for a while, and I'm leaning towards the side of paying cash for it, but my wife isn't there yet.

So I was wondering if you guys have any advice for us on that. What's the financial? I think I know the answer. I just want to hear it from you. What is the financial advisor saying why you shouldn't be paying cash? So his main reason, he says, is taxes and the interest that we're earning on the money is more than the interest rate that we'd be paying on the money.

Yeah. Yeah. What's the taxes? What was he saying? Taking money out. You'll have to pay taxes on the money you have invested. Yeah. Yeah. But you're going to have to do that at some point. Yeah. And I realized that I think the problem that I'm struggling with is the disconnect between my wife and I. How how do I help her understand that?

I realize, and we've done the math, and I've showed her the numbers of what we'd be paying for the mortgage. So the house is $575,000. We're selling the one that we have now. We did a loan on that because that's kind of what she wanted to do, and I was okay with that at that point. And this one, I think there's a disconnect between

her and I, and I'm, and I'm not sure how to get over that. Yeah. From a relational standpoint is what that ends up being. Yeah. So I think one of the things that's hard, that's not so black and white when it comes to this argument of the investment and the interest rate and all of it is what you can't put into an Excel file in a formula is peace of mind and autonomy of

of just having the ability, right, to own everything you have, including your largest asset, probably the one nearest to a family's heart of safety and security is your home, right? Like it's literally the roof

that you go under to live and raise your family. Like it is such a personal part of your life. And to have that and have such peace with knowing that there is no money owed on it that you have the ability to, you just can't put that into a financial formula. And then the other thing I would say, Ben, is, you know, we've done the largest study of millionaires ever done.

And one of the number one things that people say in order to get them to a place of millionaire status and to continue to build wealth, to change their family tree is to pay off their home. So people are looking to do this. This is a goal people have.

And it's such a outlandish goal because so many people don't have the ability to do it right now. So it's a seven-year goal, right? So the fact that you all can do that today, it just puts you so ahead, so ahead of where you are. And what's wild too is just running the formula of, okay, let's just say you

let's pretend that, yeah, you invested the mortgage payment every year or every month, right? And how quickly you could build back up your savings even by just doing that. And so, yeah, I think it is scary because it is a lot of money that you're just putting out there, but you're putting it into an asset that continues to go up in value. And the market right now, I mean, if you have the money, it's a great time to buy because it's so volatile, right? Even in the last, with all the tariff stuff, even in the last like two weeks, it's just up and down. It's just crazy. Yeah.

And so if anything, I would want more stability in my life. And having a paid off home gives gives you a huge level of that. And so that's the hard thing is you can't where a financial advisor usually is looking at the math and the numbers and the percentages. You you can't put the emotional part of money into that. And so that that's that's the point that I feel like is always a hard turn for people to understand. But you know what I would tell her to been if she would, which I know this is a big deal, but

I would ask her like, Hey, since we did the mortgage on the last house, can we do the paid off home pay for cash this and let's give it nine to 12 months. And if we hate it, if we hate having a paid for house, like it's just the worst thing in the whole world. Go, go take a mortgage out on it. Like you can do that. Yeah. You can always go backwards and do that. And I'm telling you, he's going to be like, no, this is great. Yeah.

I'm with Rachel on this. And Ben, I'm curious, do you have all this money invested with your financial advisor? Yes. Okay, so let's answer another question. There you go. Is the financial advisor incentivized to keep your money with him instead of having it in the equity of your home? Yeah, so can I give you guys a little bit of a backstory here? Sure. And I think it has somewhat to do with why my wife is feeling the way that she is. So this money, we're 25 and 27.

And this money came from her parents being killed when she was a baby. Oh, my gosh. And there's a lawsuit. Oh, I'm so sorry. So...

Yeah. So, so, and then it's been invested for 20 years. So, so there's a larger sum of money than that. But for her, it's like this, um, I think it's emotional ties and like an emotional tie to that. And, and she, like, she wants, like, she wanted the house. So like we're purchasing it. Um, but like seeing that money leave the account is, um,

is what's I think hard on her. Um, and, and yeah, like, uh, George, what you were saying about is this investor incentivized to keep the money in his account? Like, I, I understand that, but like, I don't, how do I tell my wife that in a way that she understands? Like, I don't want to, that almost sounds, um, like because of B the attachment to the money that

that she has. I don't know if that makes any sense. No, it does. So I think to George's point, I think your wife can understand that regardless of how the money was came to be. And we, and we don't know the heart of this financial advisor either. Right. I don't think they're a bad person. I don't think it's malicious. It's just the nature of their job. Yeah. There's a nature of the job that, that is very understandable that I think anyone can kind of grasp and understand. Right. So there's, there's that piece. And then for her, I mean, I,

I would say that the legacy of continuing her parents' legacy

This is a beautiful way to do it. I mean, it's almost like, it's almost like they purchased this home for you all. Right. In a sense that you get to raise your family in, like there's something, there's something beautiful in that. And the fact that if you guys continue down this road and continue to invest and be smart about it, like maybe you all can pass that legacy on to your kids, right? Like you can continue this snowball effect of something that was so horrific and so terrible that,

to be able then to do something beautiful and redemptive about it. And in my head, I'm like, as a parent, I would want my kids to have the least...

stressful life financially if they can. And that's partly making smart decisions with money on your day-to-day basis. But it's also when you go and purchase really large items, cars, houses, to do it in the wisest way that becomes a blessing and not a curse. And this is doing that for you all. Do you know what I mean? So I see it as a beautiful tool. And for her, I can't imagine her...

story and the fact that it was, you know, as a child and growing up without your biological parents and it ending in such a tragic way. I mean, all of that, there's so much there. And so the grief and the attachment is totally understandable emotionally. And this is going to sound harsh, Ben, but I am going to just say it. Sometimes our emotions are the worst drivers when it comes to financial decisions, too.

And so we don't want our emotions driving things. Sometimes it is leaning back on looking at, okay, what's better overall for our entire financial picture? Because people do a lot of things out of fear.

grief, stress, right? We look at these emotions and they don't always, they're not, they're indicators and, you know, they're the lights on our dashboard of saying, hey, this thing is lighting up. And that's something to be curious about and dig into on your own personal story and what's going on with you. I think that's important, but we don't want it to be the only thing driving our financial decisions because usually it's not. We've said fear is a terrible financial advisor. Yeah. So Ben, what would the mortgage payment be? Give me just a ballpark.

I believe it'd be $3,500 a month or so. Okay, here's the good news. I just popped it in this investment calculator. $3,500 a month from $25 to $65, you'd have $22 million in there. So if the fear of security... By when? By when? By 65. Okay, $22 million. $22 million, which is more than you got now. She just invested the mortgage payment. Exactly. So there's a piece of this where you have to tackle it with the emotion, the pain point she's experiencing. Then you can use the logic and math to go, it's going to be okay. Here's the real facts. We're rooting for you guys. This is The Ramsey Show.

All right, Dave, you have some strong opinions. Possibly, yeah. Yeah, I think so. Okay, because you really prefer credit unions over big banks. Well, credit unions, for one thing, are non-profit, which means that the members, the customers, own the credit unions.

the credit union. So any profits that the credit union makes goes back into customer pricing. So you get better interest rate on savings, cheaper checking, and so on, that kind of thing. But what's more important than that, though, is the fact that the customer is the owner changes the spirit on the credit union. So I find very few credit unions that aren't very customer-centric. Well, and I think we have found one that is incredible, and that's Fairwinds.

They are an incredible credit union that is really out with the heart to help the customer. They're the right kind of people with the right kind of values. And they've done a really, really good job with customer service. And the deals that they're offering, the Ramsey Tribe is incredible. Yeah, absolutely. And I love it. The things that we teach, they so line up with. And you're right, their customer service is unbelievable. Winston and I just signed up and we got an account. Yeah. And I'm not kidding. It took less than five minutes.

It was so user-friendly. Like the step-by-step approach was unbelievable. And then the next day, my phone rings and it says Fairwinds on my phone. So I answered it and talked to someone there and they said, yeah, they give calls to every new customer. And so again, they just really care about your experience. And I...

I so, so appreciate that. Plus, anything that you can do at a traditional branch, you can do with them at fairwinds.org or on their app. And you'll have free access to over 33,000 ATMs. Hey, you guys know how much I hate banks in general. And so for me to do this is a big deal. Talk to our friends at Fairwinds.

and check out the combined checking and savings bundle that they created just for the Ramsey tribe. You guys, it's incredible. Yeah, you guys, it's so easy to join Fairwinds no matter where you live. So go to fairwinds.org slash Ramsey.

Welcome back to The Ramsey Show. 888-825-5225 is the number to call if you want to join the conversation. And let's see, Rachel, I think we have a question of the day here from YRefi. If you've got defaulted student loans that don't let you gain any momentum, we get it. No judgment here. But also, nobody's coming to bail you out.

So take charge today at YRefi.com slash Ramsey. They offer refinancing to a low fixed rate loan built just for you. That's the letter Y, R-E-F-Y dot com slash Ramsey. May not be available in all states. And today's question comes from Michael in North Carolina. Is it wise to open up a 0% interest credit card to handle a big expense?

with the intention of paying it down before the interest kicks in. My partner can't understand why this is a horrible decision. We need chimney repairs and it's going to cost about $4,500. We have enough saved to pay with cash. She doesn't want to use that money because she thinks it's the emergency fund should be able to be used, only can be used in case of a job loss. How can I convince her that it can also be used for repairs later?

Like our leaking chimney. Oh boy. There we go. We're using the wrong tool for the job. I think that's, this is one of those where it feels like a smart idea and then it becomes a slippery slope where you just stay in debt your whole life thinking that you're winning the game.

So the 0% interest credit card, you have a big expense. Here's what happens. You end up going into debt to cover this big expense that you couldn't save up for. You stay in debt. You can't pay it off in the terms that were laid out of you need to pay this off within six months before interest kicks in. And then you call the Ramsey show and you've got payments all over your life going, well, we got the 0% card and it all started there. Yeah. So the solution here is an emergency fund.

Not another credit card. Yeah, which you guys have. So we have enough saved to pay with cash. She doesn't want to use it. She thinks the emergency fund should only be used in case of a job loss. That's not the case. Yeah. Emergency fund is for things that are what's our four things? Urgent, unexpected, unexpected, urgent, necessary and necessary. And I would say a chimney.

I'm going to say it's necessary. I feel like there could be a lot of house fires if this thing goes wrong. And then for the future, set up a sinking fund for maintenance and repairs, knowing, hey, you know what? The chimney is pretty old, probably going to need some repairs in the next few years. Let's go ahead and put a few hundred bucks away in a savings account just because we know what's going to happen. But for now, use the cash. Don't open a 0% card. You're not doing yourself any favors. You're just playing games with snakes. You're going to get bit eventually.

So I don't know how you can convince her. That's up to you. You decided to marry her. You figure it out. But it's going to take a little bit of persuasion because she right now she's thinking this is my security blanket. I don't want to touch the emergency fund. It's there to protect us. Right. While putting yourself at risk with this, with the other thing. That's it. That's the that's the illusion that debt can cause is that we are OK because we may have some money cash in the bank, but you're at risk.

when you owe people money. Like there is still a level of risk involved that if something were to happen, and let's say you had to use your emergency fund because there actually was a job loss and you hadn't paid off the credit card. Now there's a job loss with no emergency fund and a credit. You know what I mean? So just like, just start it. Don't do it. Don't do it.

Just stay away. Your life's going to be better. You just pay for your life with cash. Only have a debit card. Don't even have the credit card open just in case. Just close it. Shut the door. Keep out the devil. Remember that song back in the day? No. Country song? I don't know. I grew up Arabic Baptist. We sang that song a lot. I got you. I heard it. I know what it is. Keep the devil out? Is it a hymn?

I wouldn't call it a hymn. It's like a Sunday school song. Yeah, a Sunday school song. Rachel, wow. Fine. Just leaving me in the dust. And I grew up charismatic. The comments section will back me up on this. They're all about the spiritual warfare. Oh, my gosh. All right. Go to Julia. Let's go to Julia in Sacramento. How can we help, Julia?

Hi, guys. Thank you for taking the call. I'm calling because, and I had spoken, I think it was with Jonathan, and they wanted me to call back, but I never got through. That's all right. You're here today. I'm struggling with my husband, okay? I'm ready to divorce. Oh, gosh. He refuses to think about retirement. I don't know what to do. We're 66, 67. I have a teaching credential in Michigan.

I'm also in Texas and applying even to Tennessee. But the thing is, he says that we're stuck in this house, that if we move, it'll just cost money. We're in California, so the house is worth a little bit of money because it's California. But we still owe, it's five something, but we still owe $325 or more on it. And I don't know what to do with the house. So what is his plan?

He doesn't have a plan. Well, you're in retirement age. So the idea of refusing to play, you're here, you're in it. So what's he going to do? What's he thinking? Do you have a big nest egg? Do you have a pension from teaching? Do you guys have 401k? No. So how are you guys paying bills right now? He has a Roth. Okay. How much is in that?

I don't know. Okay. He hasn't, he said zero. He said zero? Zero dollars? Is he with you right now? He doesn't want to speak. Okay, that's fine. I'm not trying to get him on the phone. I just, you were saying he said he has zero. That was a current. Right. How are you guys paying for food right now and the mortgage? Well, he's working. He's a service director at a dealership, so he has a good job. Okay, how much is he making a year?

I don't know, maybe 130, 135. Okay, and are you working, Julia? Right now, no. Okay. I'd like to get teaching again, but I'm not certified in California. We have two girls we adopted out of foster care, so I give a little over $1,000 for them. Sure, sure. Almost $2,000, yeah. How old are they? One is 10, one is 12. Oh, wow. Y'all are amazing. That would give me one reason to plan for retirement.

One, that's right. Maybe two, two great reasons. How long is he wanting to work for? He's just, I don't know. He just thinks he's going to keep working and working. Here's the thing. Even if you love your job, at some point, your body's going to say, I can't do this anymore. Okay. That's how we're built as humans. We're not meant to last forever. So as much as he wants to work forever, what happens if there's a health issue at 70? And now this 130,000 income is gone and there's nothing to live off of.

And we got to take care of these girls. I don't know. That's why I'm calling you. Okay. So, Julia, what I would say. I'm not sure if we should move out of state to somewhere cheaper than California. I don't know. And then he's afraid that he won't get a job if we move. Yeah, which is a, I don't know. He's a service tech? Is that what you said? No, he's a service manager. Service manager. Okay. Okay.

Okay. Well, number one problem, Julia, is you got there. Some of the questions I was asking of how much is in the Roth, how much does he make a year? You, you said, I don't know. And you would just guess, I don't know, 130. I don't know. I think he's saying zero. Like you guys haven't really talked about specifics of money. Have you?

A little bit. I mean, I know he makes about 135, 130. Okay. So he, like I said, he does. Okay. Well, we're to the point that I think if he doesn't know what to do, you know, sure. Yeah, totally. Okay. So number one, we have to get on the same page of just saying Julia is in a place where she's scared. She didn't, she doesn't know what's going to happen. You guys still owe $325,000 on your house. You have nothing safe for retirement. Um,

you're in your late 60s, like lots of red flags, you know, risk, risk, risk, scared, scared, scared. Yeah, lots of red flags is right. Yeah, so there has to be. Okay, so that's where you're at. We need to figure out and you need to figure out as his wife, where is he at? Is it that there's a level of,

not knowing. And that's very intimidating of what to do at retirement, you know, whatever that is. But he needs to be honest with himself on what is causing him not to think about it because there's a reason why. Some people don't want to think about it because they don't want to think about death. So they don't want to do wills and they don't want to do a state plan. You know, like, I mean, there's a reason why people don't do things. So understanding that. And then you guys have to come together to say, okay,

We are both adults and we have to plan. It is part of, it's part of society. We want to be able to eat when we're 80 years old and not have to work our whole lives. So what do we need to do to get into place? Yeah. So we need to probably get with a financial advisor and get with someone who knows what they're doing. They live and breathe this stuff to be able to say, hey, let's map out how much you guys need to be putting away per month

to get you to a place that is comfortable with retirement. But the truth is you guys are going to have to work another 10 years to even probably get that. So I would be doing that, Julia, and you can't change him. Okay. So if he will not get on board on any of this, Julia, that's when we always say separate the finances at that point. And then there's a point that you have to get a job and you have to retire yourself, Julia. Yeah.

I mean, yeah, it's hard. That's what I'm trying to do. Which we don't want. I'm working out of state because I'm not certified in California. Yeah, you might need to lower your lifestyle, move to a lower cost living area and get the income up. It might be all of the above, but I want him working because he wants to, not because he has to. And right now he has to. This is The Ramsey Show. You want to know more about something?

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Live from the Ramsey Network, this is The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm George Campbell, joined by Rachel Cruz this hour, and we're taking your calls at 888-825-5225. Jamie is going to kick us off in Louisville, Kentucky. What's going on, Jamie?

Hi, I'm just wondering, at what point do you start adding fun money into your budget? What a great question for Rachel Cruz. Nobody loves fun money more than Rachel. Nobody loves to spend more like Rachel. At what point do you put it into the budget? I mean, I would be okay having a little bit of fun money.

a little bit of breathing room of, I don't know. I feel like here's my take and you can react. On baby step two. How about that? My take is if you're in baby steps one, two, or three, as little as possible to survive. Yes. What's just going to keep you just like, okay, I'm going to make it another day to fight. And then once you're in baby step four, then I can ratchet that up to a reasonable amount and make sure I'm on track for other financial goals. Yeah, for sure. Yeah. I mean, I would say with baby step two, there's a little bit of that. Like, I think the longer you're in debt, the more you're in debt.

probably the more lenient I am of having some fun money. Because if you're doing this for eight years, seven years like Jade, right? Jade and Sam were seven. You know, people that are five years older

Like there's a reality. This is six months. Yes, exactly. There's a reality of life. Like if this is going to be a long thing, like when are the times we just need to come up for air in order to go back down to stay longer down, you know, in the grind. But yeah, if you're able to get out of debt in like six months, I'd say nothing. For six months? You can do anything for six months. We've been in and out of debt. Well, there's a problem. Jamie, why? Yeah.

Um, I have a mental health disorder that causes impulse control. Okay. And so that's a me thing. Okay. Um, we've gotten it under control this time. We learned what actually was the issue when I had my first daughter and we learned it about halfway between the first and second. Um,

And now we've gotten on medication. I've been able to round out my spending and keep everything within. And I've been my husband's great. I've been watching the Dave Ramsey stuff. And in the background, he's just validation because those are principles he's lived his entire life. That's anything new to him. So where are you guys at right now?

So we have paid off all the debt. Good. We only have our mortgage left, which I think we have about $70,000 left on. Great. Do you have an emergency fund? So we have the $1,000, about $1,500 almost. We're trying to figure out when to start adding in. And he's down to start. We make where we have about $300,000 to $400,000, quote-unquote, extras to go into savings. Okay.

Every month, as long as nothing happens. What's your household income? I know after taxes on both of his jobs, since I'm a stay-at-home mom right now, after taxes and health care and everything, we have about $51,000 each year. Okay, so a little over $4,000 coming in. Is he doing any investing right now?

No, we don't know much about that. So we're not investing until we know. Okay. That's a good principle. So for now, Jamie, your next big financial goal is to get that $1,500 up to three, three, I would probably lean more of that five to six month, which will take you guys longer of an emergency fund versus the three, just because of the kids there's, you know, one person is the one making the income. And I don't know, there's just a little bit of that

kind of anything that's a volatility or a level of risk. Not that we say our children are risks, George. We would never say that. But you know what I mean? There's a level of, yes, if something were to happen, we have other people that we need to take care of, not just ourselves. So I would go up more to that five to six month. And then from there, yes, start thinking about investing and to say, OK, where can we put some of this money, 15 percent of our income?

And that will be probably sitting down with a smart investor pro and just looking at Roth IRAs, 401ks, like kind of just, I mean, I was just started at the basics and you guys can understand that pretty quickly. It's not too confusing, but, but having someone help you in that arena, I think is really smart.

But for now, for you guys, I mean, you're still on baby step three. So we would say from the baby step. So I probably wouldn't have a ton of fun money. I mean, I would have some just to be able to. Well, the fact there's only 300 bucks of margin tells me you guys are running real tight because at this point, it's going to take you years to get this emergency fund in place. That's not OK with me. If I was your coach, I'd say we need to know we need to do some things with our income and expenses. So are your expenses thirty six hundred bucks a month, thirty nine hundred a month? What are they?

Um, our expenses, I think added up after everything to about 26 to 28. Okay. But you're saying he's bringing in over four grand a month. So there should be 1200 bucks laying around. Yeah. That's the, I got to remember where we've had a lot of emergencies recently and that's kind of into the budget, um, of like a car breaking down and things, um,

And I believe that's where the rest has gone the past couple of months. Okay. I would be aiming to try to save at least $1,000 a month to this emergency fund so that you guys can be done before the year's over.

OK. Or maybe by early 2026, because beyond that, it's just too long. Baby step three is already a slog. It's not fun like paying off debt where you see momentum and progress. You're just stacking up, trying to build some foundation before you can start building for the future. So I would work. What is he doing for a job? For a job, Jamie, you said he's working two different jobs.

Yeah, so he works at a retail mattress store in one of the malls as his second job. Okay. And then he works for UPS in a paper desk job now as something or another. That's full-time? As his main full-time. Okay. Is UPS 40 hours and the mattress store is on top of that? So is he working like how many hours a week would you say, 50, 60? Yeah.

It really just kind of depends. Because the mattress one is not going to be forever. They've already showed that they are not trustworthy to keep us around. There's been maybe some layoffs here and there. Oh, wait, we need you back, so we're not going to. I'm shocked there's any mattress retailers still around. So I think if he has skills in sales and people, he can probably find a better side job.

Yeah, no, we're working on it and he's up for a raise soon, hopefully. But if not, we're going to be looking at completely switching careers soon. Yeah, I think that's a good idea because ideally, you know, especially when you're, you know, past baby step three, a sustainable 40 hour a week.

to support your life is that's going to be, you know, for a long-term perspective, what you're shooting for not working 60 hours a week just to make ends meet. Yeah. We don't want that. And so we're in that in between and he's talked about letting me have some fun money. I'm scared to death of, I don't want to cause any more issues. I want to get us through this. And if I have fun money. Yes. Are you, are you, are you seeing like a counselor or therapist for everything?

Yeah, that's OK. I would ask them about it because you're right. You're like, I don't want to open up something psychological that makes me go off the rails. Right. You know, you don't want that. But to have the safety of a licensed therapist or counselor to kind of be the one to help. They know they know about your story and what would be a trigger point. Yeah, I would be curious what they would say about it. OK, but one thing I would do is freeze your credits. You have no option to go into debt even if you wanted to.

and you can do that for free you can unplug your all the card information from every site that you use all of that stuff adding more friction in is going to help you just create more guard rails more boundaries so that you don't slip back into debt yeah and jamie hold on the line and we'll get your husband king coleman's book find the work you're wired to do because in the back there's a great assessment

That's fantastic about where your skills and your passions, everything that kind of lines up. So if you stay on the call, Christian will pick up and we guys will give you guys a copy of that as he kind of starts looking at a holistic picture of his career. And you know what? I'm going to send you Breaking Free from Broke. Read the Spending is Self-Controlled chapter. I hope it just helps you heal from this and create some good habits moving forward. Thanks for the call. This is The Ramsey Show.

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Robin is up next in Orlando, Florida. How can we help, Robin? Hi, yes. How are you guys? Doing well. Okay, great. So my question is, I am $230,000 in debt with me and my husband are. Say it again. Sorry, what was the number? $234,368.58. Perfect. There you go. You know your numbers. That's a start.

Yes. I follow the EveryDentDollar app and I go see my family twice a year in Texas. And I feel guilty if I do because I'm trying to pay off my debt, but I feel guilty if I don't because my kids want to see my family. So I'm trying to figure out how to get out of that guilt thing. We put a lot towards our debt every month. We put between $2,000 to $5,000 towards it every month. That's great. My husband makes a decent amount. So is it okay that I go see them? No.

Or like... Yeah, I mean, I don't... Yeah, the thing with these kind of scenarios, I never say like, is it okay, yes or no, to go see family? I think it's just... Not a moral issue. No, it's just how fast do we want to get out of debt? I mean, how much money are you guys spending on these trips? Like one trip to see your family, how much would that be? Five grand, two grand, one grand? Once a time, like a grand. A thousand dollars? Okay. And you're doing that twice a year.

So we're talking $2,000 to $3,000 a year. And you're not going into debt for these trips? No, I put it in my budget. I do the EveryDollar app. I put it in my budget to plan it out for that trip. Yeah. And I just pay a little less on my debt that month. Yeah, I mean, again, I think it's one of these things with any level of... And I would probably put this in the category of like a luxury because is there anyone sick? Like, is there like a...

Oh, my gosh. Like, we're going to go visit. We only don't know how many more years we have with grandma. Or is it just that this is a tradition? We always go see them for these holidays. It's more of a I miss my family. I get homesick and I like to go see them. Yeah. Yeah. Which is totally fine. So, yes, I think it's one of these things. If you and your husband agree that two grand a year.

um, is going to put us back, you know, what, two months probably in a debt payoff in general. Like, is that, is that trade off worth it? And I mean, I would probably say, yeah, I mean, you know what I mean? Like, I don't know. Like we've said, like if people are getting married out of state or like there's a destination wedding or there's a funeral, right. There's reasons to travel. And it's usually for more of a

celebration or a event that is once in a while, you know, something is happening. Can they come to you or are they too old? They come to us twice a year as well. So we see each other four times a year, but they come to us and then we come to them. Last year, we didn't go see them at all.

Because why? Last year, but this year. Why didn't you go last year at all? We were opening a business and I had to really focus on that last year. And so it was very hard on our mental capacity. And I just had a newborn son. Okay, yeah. So, okay, so Robin, I feel like you guys are very detail oriented. You know your numbers really well. When do you think you guys are going to be completely debt free? And does the 234 include your mortgage or is that all consumer? Yeah.

That is all consumer. I also have a mortgage of $430,000. Okay. And how much are you guys making a year? So my husband makes between $15,000 and $20,000 a month. Okay. Why can you only put $2,000 a month towards your debt? Now I'm mad. No, she said $5,000. $2,000 to $5,000. She said $5,000. Yeah, but he's making $20,000. Why do you guys have $15,000 of expenses every month?

Well, we have a pretty high mortgage and then my son is in school, which that is about to change. So that number will go up. That number is going to go down because he's about to be in pre-K. How much is the mortgage a month? $3,500 a month. Okay. And how much is the school a month? $1,500 a month. Okay. So there's $10,000 left, Robin. At least. And $5,000 we'll say is going to the debt. So they're living on $5,000.

George isn't happy. George is not happy. It's going to take you guys six years to get out of debt. Do you hear that? It's going to take you five or six years at this rate. That's at the minimum. So I calculated everything to the minimum and then anything extra goes straight towards the debt. Like this month we put $7,000 towards our debt.

Okay, that's good. Okay, so then they're living on three. But can I do the math for you? I try to. Average debt payoff for someone following the steps with gazelle intensity is 18 to 24 months. Now, you guys have a lot of consumer debt, so that's just the average. You guys might lean to two, two and a half years, three years. But that still means you need to be putting seven to 10 grand per month consistently towards this debt to knock it out in two to three years.

And I want that to be like come hell or high water, we are putting $7,000 to $10,000 a month. Do you understand? That is our plan, yes. But during the summer months, my husband doesn't get as much extra work. So he works two full-time jobs, and then he's a wedding photographer. And he does a bunch of side gigs and makes him a lot of money. But during the summer, that slows down. So I lowered the amount that we put towards the debt because we are making the minimum of $15,000 at that point. Okay.

But do you see what I'm saying? I want you to have a fire. And right now, I feel like you guys are fairly comfortable the way you're talking and the lifestyle. I want you to cut this down to nothing. You can still do the trip. The trip is not what's causing this. I think there's a lot of other leaks happening as well. And that's where this budget will reveal it to you very quickly. Hey, we made 20 grand this month. Where did it all go? But you're doing the every dollar budget, right? Yes. So you're seeing it. A lot of it recently has been going to the business. Yeah.

Okay, and what's the business? So we're just now starting to break even. Okay, what's the trajectory? Is this thing going to be making money in the next two months? It's a franchise, and I'm hoping it will, but we are currently breaking even. How much of this debt is tied to the business? None of that. None of it. We have— How much of it is cars? This is only $40,000. Only? I don't know what part of town you grew up in, but that's a lot of debt. What?

It's a lot, but we have really good interest rates. We pay $500 per car. You're so lucky Rachel Cruz is here to be good cop. Oh no, Robin. Robin, I'm just telling you right now, call me back when you're serious and you actually want to get out of this mess, not when you want to tell me you have a great interest rate on your debt. I mean, you guys make a quarter million dollars a year. Do you understand how insane this is?

Yes. Yes, I do. That is why I am. How much is that? Hey, Robin, how much could you get for the car right now? If you Kelly Blue Booked it, what do you think? Have you Kelly Blue Booked it? Probably not. I have actually. For my car, I would get about 10 and I owe 20 on it for my husband's car. I would get about 20 and he owes 21 on it. Wait, hold on. The $40,000 car. Say that again.

You would only get $20,000 for it? For my car? I would get about $10,000 on my car. And you owe $40,000 on it? And I owe $20,000. Oh, okay, okay, okay. I hear you, I hear you, I hear you. There's two cars for $20,000 each. I hear you. Okay, so $10,000 for yours, and then what would he... And $20,000 for his. And $20,000 for his. And $20,000 on his. Okay. So the way you could look at this is the $40,000, which you'd have to put $10,000 because you're underwater $10,000.

But that's $30,000, which, George, to your math of what you're saying, would be, you know, the way she's going at five grand a month, you would save six months by just selling the cars. You could save six months of being in debt. So let's do that, Robin. And that would show George...

That you are serious. I need some skin in the game. Robin, if y'all sold these cars in the next 10 days, then you're serious. Okay? That would be like, yes, we are scorched earth. We are doing anything and everything to get out of debt.

And that would be the move to make. That's saving six months of your time of being in debt. It's just from cars. So that has to be your mindset. George, how are you feeling? You okay over there? I'm doing better. It's still a little heated. Breathe, George. Breathe. Just breathe. Take some deep breaths, George. So that's Robin. That's the kind of stuff we're talking about. And then from there, and if you can get out of this franchise, it's feeling like it's sucking up money and

Your husband's already working like four jobs, what you're saying. So you guys have a lot of busyness and clutter in your life. So I would simplify everything and live a peaceful life.

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Listen, guys, I've heard just about every excuse for why folks think they can't get ahead with money. So let's go ahead and settle this right now. You get the final say on what happens with your money. That's why you have to start telling your money where to go so you can stop wondering where it went. So if you're going to start winning with money, you have to get on a budget. The easiest way to get started and stick to it is with the EveryDollar budget app.

It'll help you make a plan for every single dollar coming in and every single dollar going out every single month. And guess what? It's free. So no excuses. Download every dollar in the App Store or Google Play today. In the lobby of Ramsey Solutions on the debt-free stage, we have Jacques and Jennifer here to do a debt-free scream. Welcome, guys. Thank you. Thank you. Where are you guys from?

Cincinnati, Ohio. Love it. Thanks for coming by to do your debt-free scream. How much did you guys pay off? $203,000. Oh my gosh. How long? 52 months. Yep. And making what kind of money during that time? Not enough. We started out about $160,000 and ended...

Wow. What was the jump? Just some job changes. Okay. Promotions. She got a new job. Great. What do you guys do? I'm in, I'm a marketing director, property management.

I'm a state trooper in Ohio. Okay. Wonderful, you guys. I'll remember you if I'm ever driving through Ohio and I get pulled over. You need someone. Well, we work on commissions, so. Oh, no. Not good on you, George. I love it. And what did the $203,000 consist of, of debt? It was our house. Our house. Oh!

Oh my gosh, completely dead. We are weirdos. Oh, how does it feel? Unbelievable. Yeah, it was great. I can finally buy the things I want. There you go. There you go. You know, it's funny you say that because we, I talk about in my book, Know Yourself, Know Your Money, about why we want to win with money. And for some people, it's pure safety. It's like, I just want to feel safe. And I just want to feel safe.

And then for some people, it is more of this, I say status. It's not a bad thing, but it's like I want to win so that I can enjoy my life and do things with that money. So I feel you. I feel you, Jacques, on that. That's great. I love it. Well, she's making fun of me because I call it the summer of Jacques. I'm doing all the things I've wanted to do. Going to NASCAR races. The summer of Jacques. Was there like a big carrot you were dangling of like this is the big thing I want to do?

Or was it like a habits? What are your hobbies? What are the things that you were looking forward to doing once the house was paid off? I mean, just to finally buy stuff that we want. Upgrade the house. More experience. I want to go and see and do things. I love it. That's amazing, you guys. Okay, so what happened 52 months ago that caused...

this this whole journey of being weird people i drank the juice or the lemonade or whatever it was called and i just started just and i followed yeah yeah i just started watching was it watching clips so how'd you guys get connected to us she started she uh that was a accusatory yeah that's right i'm good at that um she started on uh listening to the podcast on on uh the ramsey network and then

When we were exercising, we would listen to stuff and she got hooked. And then you looked at her numbers? So then you looked down. He's like, I'm hooked to her. So I got to do it. No, there was a level that you were probably like, this sounds great. Well, I do. I do like having the security. I'm a security person. So, you know, now that you don't.

It's not fun to own people money. Yes. Yeah. So the autonomy feels great. It's just like you're on your own. There's no banks attached. So you're like... And I think it was COVID. Yeah. COVID hit. At the time we had a mortgage, we were able to refi it like super low. We took it down to 15 years because Dave said so. Yes. And then...

She just was like, let's hammer it out. And y'all did it together. Jacques says so. Yeah. He's his own man. I've been saying so for a long time, but you know, with an asterisk. Yeah. I love it. Yes. Oh, that's great, you guys. You just looked down and you went, all right, $203,000, we could knock. How quickly could we knock this out? Did you guys set a goal? We didn't. I mean, we cash flowed quite a lot of things. She did the ring thing. Yeah. And then we did the ring thing.

And then that stopped. And you rip off a ring for like every $5,000 or $1,000. Yeah. But then that fell off the wall. And so then we had to. Your arts and crafts project didn't work out. We didn't have tape. We didn't have the money for it. So.

Well, did you guys decide, hey, we can knock this out in five years or less? Like, was there a sort of a, all right, this is doable in the foreseeable future? We just knew last year we wanted to pay it off by the end of the year. So 2024 was the year we were paying off our house. It was the big year. Okay. And you did it. And we did it. And in that 52 months, was there consumer debt that you guys paid off first? We actually just...

No, before we started, we paid off. I wrote a check for my car in 2019. Okay. And then we cash flowed a newer car, a bike for you. Yeah. And then finished our basement. So we did other things. Yeah, totally. And had great vacations. Incredible. Yeah. We didn't do rice and beans. We did ramen and popcorn.

Actually, I like that diet better. That's an upgrade, I think. That sounds better. Rum is pretty cheap. Maybe not an upgrade health-wise, but at least excitement-wise. Okay, did you guys tell people what you were doing during this time? Were there people on the journey that were kind of cheering you on? Did you kind of keep it to yourself?

I mean, you know, family members were cheering us on. I really just think that it was attributed to just listening to this pod, you know, show and just listen to everyone, their debt-free screams. Because honestly, everyone thought we were weird and we knew we were weird and we wanted to be weird. So...

Confidently weird. No insecurity. Oh my gosh. And now they're going to be going, can you guys tell me how you did that exactly? Absolutely. You know, along the way, I told a lot of people how to do it or what I thought, what we thought, you know, and told them what we were doing and all that. And they would listen.

And I think now that you've done it and they see what the results are, maybe now they tune in a little bit more and they go, maybe it does work. Well, they want a magic trick. When you're telling them they're wanting some complicated, cool strategy. Instead, you're just like, yeah, just pay extra on the principal. Yeah. And they go, wait, no, no, tell me something. Stick with it. I think we didn't miss a month.

You know, if we wanted something, we stuck with that. We didn't miss a month on extra payments. Wow. So that's a lot of it. And we've also became millionaires in the process, too. Babysitting millionaires. What's the house worth? So about $550-ish, give or take. And then just with other things. Investments, everything. Retirement, cars. Yeah, about 1.5 almost. Yeah, 1.5. Oh, my goodness. We are on a roll to retire soon.

With some money, maybe. So proud of you guys. So many races, right? NASCAR races. He can't. I have to work a couple more years. I know.

That's incredible, you guys. Absolutely amazing. Oh, my gosh. We are excited. What do you tell people the key is if there was one thing that you need to become debt-free? Go ahead, hon. I know. You're eager. There was an SNL skit, and it was don't spend the money unless you have it. Yes, with C. Martin and Amy Poehler. Yes. That's exactly what we're talking about. So, I mean, really. If I don't have it, can I? No. So just live on less than you make. Absolutely. Absolutely.

Don't go into debt to buy stuff. That's right. And you're going to be okay. You'll be okay. I love it. Isn't that funny? It's the satire of America though, right? That skit of like, so if I have the money, can I buy it? Like, yes, if I don't have the money, I still can. It's a one page book. Yeah, it is. It's only one page. Only one page. If you don't have the money, don't buy it. And so living that mantra. I would read that book. There you go. Yeah. That mantra. Sign me up for that one. Oh my gosh. And you guys, I mean, this is really, when we talk about changing your family tree, you

This is the big one. Baby Step 7 is where you really see it without a house payment starting to set you guys up well for the future and your kids. You guys have two, we met them earlier in another break, two beautiful girls. You want to bring them up? Come on, girls. What's the names and ages? Come on up. Stand on either side. We have Izzy, who is how old?

You're 11. All right. And then we have Avery, who is 8. 8. Yes. I'm sure they were very helpful along the way, keeping you guys motivated, accountable. They were like, hey, Mom. It was hard sometimes for them. We're not going through the drive-thru, Mom. We've got to pay this house off. I know. I know. I was like, sorry. Sorry. No Chick-fil-A today. There was a lot of...

They know Dave Ramsey probably just as good as most people. Oh, I love it. That bodes well for their financial future. This was a big thing for them too. You guys have beautiful, beautiful family. Thank you. Well done, you guys. Well done. Have they been practicing the debt-free screen? I think so, yeah. Oh, yeah. We're about to find out. The ears told me they were. We've got a parting gift for you guys. We have two one-year subscriptions to EveryDollarPremium, so you can use those or pass them along to someone else who you want to encourage on the journey.

And let's get to it. It's Jock and Jennifer from Cincinnati, Ohio with Izzy and Avery. $203,000 paid off, mortgage and everything. Complete weirdos in 52 months, making $160,000 all the way up to $250,000. Count it down. Let's hear a debt-free scream. Okay, okay. Ready? Three, two, one. We're debt-free! Woo! Woo!

Oh, we got a dance. We got a celebratory debt-free dance. As she should. That was special. As she should. Oh, incredible. Absolutely incredible. I don't know. Something about the kids that gets me every time, Rachel. I know. When they join in. I know. Oh, man.

I mean, it's just wild. You know, we had a call that we're like, should we pay cash for our house? We have the money, but we kind of just want to take it out because of the interest rates. People just talk around this stuff. And when you do it, I bet you anything, they don't want to go back into debt. Right? I mean, it's like, once you do it, you taste that freedom and autonomy. Once you get the weight off you, no one's going, hey, I'd love to get that backpack full of bricks and bring that back over. They're free. Absolutely free. I love it. And Baby Steps Millionaires in the process. Look at that.

Incredible. Intentionality. Focus. It's what it takes. Discipline. Live on less than you make. You heard it here. It's so simple, and yet very few people actually do it. But they did it. We're so proud of you guys. This is The Ramsey Show.

What if one night could change your future? You don't have to stay trapped in the same old patterns that have left you stuck in your money, relationships, and your life. You can break the cycles that have kept you from moving forward. Dr. John Deloney and I will show you how live. The Money and Relationships Tour is starting this week.

Join us in Louisville, Durham, Atlanta, Phoenix, Fort Worth, or Kansas City. It's down to the wire, so grab your tickets at ramseysolutions.com slash tour. That's ramseysolutions.com slash tour.

Welcome back to The Ramsey Show. You know, a lot of what we teach, Rachel, is about getting your income up. We say your greatest wealth building tool is your income. And a lot of people go, okay, well, that's nice, but how do I just go make more without asking my boss for a raise and making it awkward? Well, there's this thing called side hustles, and there's a gig economy out there now where you can just download an app and get out there and start making money tonight. And so what I did was create a side hustle quiz with our team that can help people figure out, based on your time,

and your target of what you're trying to do, how much money you're trying to make, and your talent, we can actually serve up some side hustle options for you to make it easier. Yeah, which you're actually going to be great at and enjoy, right? Yes. Because sometimes you do a side hustle and it's kind of miserable. You're doing it just to make some extra money to pay off the debt. And there's a reason for it. But if you can enjoy it in the process, how much better is that? Exactly. And so this...

So I took it, George. You took the quiz. I heard George had a quiz and I said, I'm going to be a good friend. And I am going to go through this quiz. It gave me like when I was a teen, we'd have like 17 magazine and they'd always have quizzes. I love the good quiz. You know what I mean? Tiger beat. Yeah. It was just like, you know, what kind of dream man do you know, do you like or whatever, right? Or like, what's your, I don't know. It would be all these like teen type quizzes. So it gave that, that,

that energy, George, a little bit more professional. Thank you. Yeah. Tiger beat, but with a master's degree. That's what the side hustle quiz is. All right. Let's, I have your results on the screen. So walk us through this, Rachel. Okay. So my best side hustles. Are you ready for this? Well, what, what is your, we have like personality archetypes. So what is yours called? In-person side hustles. Nope. Further up. Oh, oh, ooh, professional. Nope. Is that you?

RC? Oh. Did we switch it? Limited edition? Maybe. Now I don't know, James. I guess they're accurate, right? Yeah. Okay, I guess Rachel's the professional. No, this is mine. I was shocked as well. I am a professional. Your question. Okay, so I have it up on the screen. No, this was mine. Follow along if you're watching on YouTube or the Raging Network app or Spotify. You can see this. So you got some options. What are your in-person side hustle options as the professional? Okay, is consulting...

So this is using your skills. That's why we call it the professional. Yes. So business consulting, career coaching, financial coaching, investment counseling. That sounds right. Nannying. And I'm a mom of three. Sounds right. I'd be a great nanny.

Event planning. You would do great with that. Y'all, this is literally my, this is my world. Bar mitzvahs, quinceañeras, you would crush. Yes. Working part-time, exploring a new career path. So just in general. Okay. And then my at-home side hustles would be teaching English. Okay. I know English well.

And then freelancing. So just finding something that I can do. But this was great. And I am a professional, George. What are you? Are you a professional? No, you're not. No, I didn't. What I got was the limited edition. Which means what? Well, it's because I'm busy, Rachel. I don't have a lot of time throughout the week. Oh, I put I had more time to do my side hustles than you. As the dad of a toddler and one on the way, it's just a lot, you know? Wow. So...

I said, I don't have a lot of time. What can I do based on my skills? And here's what it spit out. In-person side hustles, indoor and outdoor home maintenance and repair. Stop it. You know me. Stop it. That's what I do best. This is a good quiz, George. Why do you feel like this quiz is failing America? Honestly, if it was home organizing, I could crush with my OCD. But repairs, why do they give you repairs? I think it's just something you can look into. Okay. These are just options. It's not saying this is- Yeah, it's just flipping a breaker. Yeah. George,

George isn't even great at that. But you know what? A great one that showed up was photography. That was my past life. There you go. Media world, film, photo. I used to do wedding videography. And so that's a good one. And skateboard videos. That's right. And then at home side hustles, freelancing, which is something I actually did as a side hustle for a long time. You know, building websites, taking the skills I have, branding, whatever it may be, tutoring, and then transcribing, which I'm a great typist.

as you know. Oh, a transcriber. So I could sign up for a website where I can transcribe videos and just type out what they're saying. Love it. So there you go. Just some options. And if you guys want to take this at home, it's completely free. Jump on to ramsaysolutions.com slash side hustle. Take the quiz. We'll also link it in the description and show notes wherever you're listening. But here's the goal.

find out the things that you can do to make extra money and then add up what you could make per week, what that does per month, what that does per year. And this might be for a season while you get out of debt or get the emergency fund in place. I'm not advocating for you to have a side hustle for your whole life, but for a season, do what it takes to get to a place financially where you're stable. You have some foundation so that you can build wealth for the future. It's good. I'm so distracted because transcriber,

Are you a Friends fan? Your sign failed. Yeah, I mean, I know of Friends. I haven't seen every episode. Yeah, when they played the game, boys against girls, and one of the questions was, what is Chandler being due for a living? Oh. And they couldn't remember, and Rachel was like, he's a, he's a, he's,

And I think I thought she said he's a transcriber, but it wasn't because like that's not even a word. Transcriptionist, maybe. No. OK, I'll find it. But someone will let us know when you said transcriber. I just went and played that entire Friends episode through my head as you were talking. I could tell you were in another world. I was like, what was that answer? That Rachel Gay. I'm hearing transponster. Transponster. Transponster. Transponster. Transponster. And then Monica's like, that's not even a word. If you guys ever wanted to know what it's like being inside the mind of Rachel Cruz, that summed it up right there.

Me saying one word and her completely going somewhere else in her mind for the next three minutes. You're doing great, though. Send the people to your quiz. That's right. Go check it out. It is great. It is awesome, George. Well done. Thank you. And I'm a professional. So professional. All right. Brian is up next in Annapolis, Maryland. What's going on, Brian? How can we help today? Hello. How are you guys doing today? Doing well.

Is that Rachel Cruz on there as well? It is, Brian. Hello. In living color. The Rachel Cruz. Get out. The professional Rachel Cruz. Possibly the event planner Rachel Cruz, but that is me. Yes, Brian. How can we help today? I got a little sidetracked with the side hustle. I had my question prepared, but...

The Side Hustle Ramsey Quiz. Is that a thing? Like, is that somewhere I can go? Yeah, go to ramseysolutions.com slash side hustle, and it'll take you right there. Okay, thank you so much. I appreciate that. People are going to think that this was a planned call for you to talk about this. I promise it wasn't. Do you have a real financial question for us? Yes, I'm so sorry. No, you're great. I just want to make sure we're running out of time. My mom at age 80 has no retirement. I am her...

dedicated financial person, dementia comes and goes. Luckily, yeah, thank you. Luckily, she came into a small windfall of money. It was 20 grand. It's now down to 12, and that's why I'm helping. So the question is, what investment vehicles are left at her age? What does an 80-year-old person do

I've heard CDs, I've heard money markets, and I'm like, okay, well. Does she have an income right now? Yes, sir. How much does she bring in every month? $3,144. And what are her bills every month? Okay, so her bills, she has a single. Just total. What is the total for a month? Is it less than $3,100? Yes, it is. Okay. How much is left over? $700. So essentially she has $700 a month to invest.

From her income. Yeah. That's twelve thousand sitting there. I would just park all of that in a high yield savings account. High yield savings account. She doesn't need to be investing with that money. She needs that money to protect her in case of emergencies. Yeah. What's her housing situation, Brian? Is she renting? Does she own?

She just got out of a bad situation with my brother. He's in jail. We'll leave it there. My sister and I got her in a 55 and over retirement community. She has a single bedroom apartment. Okay. She's renting? Life is good. Yes, sir. Okay. What's her rent every month? 14. Okay. Yeah. And what is she doing for a job? What is she with the dementia kind of going in and out? What's her, what's her job?

There is no job. Oh, it's Social Security? All of it? Yes, ma'am. Okay, I got you. Yes, ma'am. So it's half social and half VA benefits. My dad was a Marine. Oh, wow. Okay, okay. And what's her health, Brian? I mean, I know with dementia, it can vary, but do you guys, do you think she has another 10 years or do you think she's not doing well? We're on a 10-year plan.

my sister and I are. It's, so I heard Dave Ramsey say, if you make it to 64, you have a good chance of making it to 90. Is that something close? Yeah. Yep. Exactly. We're just like, okay, she's going to make it to 90, 95. And are you and your, are you and your sister in a good place financially to help in the meantime, if she needs it?

I'm on baby step two. She is sort of on baby steps one. Okay, we're going to say no on that one. But I would just stack that cash in the high-yield savings, and even that $700 a month, just keep adding it to the high-yield savings. I don't think I'd worry about investing for the next 30 years right now. Let's just try to survive and get a nice cushion. This is The Ramsey Show. No matter what you want to do with your money, don't call every social media account.

Hey, what are you still doing here? You know the rest of the show's happening on the Ramsey Network app, right? So you gotta jump over there to continue watching. You can download it for free. Just go to your app store, type in Ramsey Network. It's completely free, and I'll drop a link in the show notes to make it easy for you. So if you're watching on the app, you're in luck. But if you're watching anywhere else, this show is over for you. So jump onto the app and let the fun continue. All right, go on now. Don't make it weird.

Okay, I got nowhere to go, so you need to go. Okay, bye-bye now. All right, this is getting weird over there, guys. What do we do?