Ditching Debt Is the Fastest Path From Stress to Peace

Thanks for being with us. Alyssa is with us in Dallas, Texas. Hi, Alyssa. How are you? Good.

How are you, Dave?

So, there's about five families total. I also wanted to include his 30-year-old daughter, and she has an eight-month-old son. It was $270 per family because my mother-in-law paid for the majority of the cabin. So, his daughter had paid me $170, leaving a remainder of $100.. Five days prior, she kept asking how to budget for the trip.

I felt like she was trying to get me to offer to pay for the remaining $100, and plus the expenses that she was asking about. I didn't offer, so she told me to keep the $170 and that she couldn't afford to go because she had to take off work from being sick. the week before. I told her okay, and then, you know, that I hoped she could come, and then she told me, asked me if I would ask the other family members to pitch an extra to pay for the $170 she already paid me. I asked them.

They said they didn't feel like they owed her. So, then she asked if I would pay her the $170.. I asked my husband. He didn't feel like we owed her, because I brought up to her the fact that she had paid.

Okay.

And he didn't want to, he didn't think his daughter should get a refund?

Am I wrong?

What she's spending her money on is none of your business. Yeah. But you're bringing that up as she's asking for this. Here's the thing. She needs the money.

That's why she's asking for it. And she figured out, hey, I can't go on this trip. I can't afford it. And I'm glad she did. You don't owe it to her, but if you could get it to her, is it really hurting anybody?

Because it's.

Well, she told me she was struggling. She couldn't make ends meet, but then we see the way she spends.

So I'm thinking this is about the past more than it is the actual situation itself. It's her pattern of living that nobody, the other family members, including your husband, wants to endorse. And you're new to this problem. Only two years have you been observing this dysfunction.

Yes. Yeah. And so, yeah, you're not in a seat to give her advice about her spending.

Obviously, because she didn't take it. All she took was offense, because you're not sitting in a seat of love, or a seat of respect, or a seat of where she's asking and values your opinion. She simply wanted her money back and you started teaching her about her money. Wrong. Right.

That doesn't work. I piss anybody off, by the way.

That's unsolicited. My grandmother used to say those convinced against their will are of the same opinion still.

And so that's what you were trying to do. And so, yeah, I don't think you owe her the money back, but you do probably owe her an apology for interfering in her life. You went there. If you wouldn't have spent money on this and this and this, you could have come. Bridesmaid thing and the drugs.

No, just leave it alone and go on and just go, we've looked at it and we don't want to pay you. We don't want to do this. It's not that.

Because that's saying, well, if she doesn't pitch in her 170,.

It was just more of a wish you would have asked. It was entitled. Yeah. Like she said, you, then you pay me the 170.. I wish it was more like, Hey, I'm struggling.

I can't do it. Then you, then I would have been, because I have, I've been very generous with her in the past and I'm really easy to sucker, but you got to sucker.

I guess, you know, my son, I don't disagree with you. I don't disagree with you on that. If she comes at you, if she comes at you, she bought 170 is what she bought. And so, yeah, I mean, I don't disagree with that at all. The only thing is, is that, um, it feels like she's, um, there's all these other family members that she's on the outside edges of the rings of this family already.

She already feels like an outsider and this, just, this, just drove a stake in that. It feels like just listening to the story. I don't know. None of it. sounds like it's worth 170 grand, $170 to me.

Right. I just want to make sure they.

Yeah. And I think, I don't think he would, he just said enough. I mean, it's her dad. That is true. If it's the, if it, you know, if it's a stepmother, you can, you can think, maybe, well, maybe there was some more spite, but I think dad just looked at it and went, yeah.

And the other family members are like, I'm not, I have no responsibility for her. Of course I don't. And, uh, but then it lands back on Alyssa. And then, when she came at Alyssa, Alyssa went back and went, yeah, but you bought an airline ticket and you got this prescription and you got these other things you could have, you know, it's a matter of choices and you're making bad choices. Tone matters.

But I think the girl, I think you're right. The girl's hurting financially and she's not very good at relationships. Yeah. They're all there. All the.

You know, that's her dad. I can hear it. I can hear it in my head. This is the Ramsey show.

Don't rely on politicians or the healthcare system to do what you can do for yourself. We teach personal responsibility on the Ramsey show. And that's why I'm excited to tell you how you can take your family's health into your own hands. A medical emergency kit from the wellness company. I got mine and I can tell you this is not some rinky dink first aid kit with band-aids.

It comes with real prescriptions, prepared by leading doctors to treat over 30 common illnesses. This kit can treat infections like strep, throat, pneumonia, UTIs, and bronchitis. because you have the prescriptions on hand, like a Z-Pak, amoxicillin, or ivermectin. And if you start your meds faster, you get well faster. The kit gives you peace of mind.

No doctor visits, no pharmacy lines, no co-pays. Wellness company medical emergency kits help put you in control of your family's health. So go to urgentcarekit.com slash Ramsey, answer a few online questions, and get your kit rushed to your door. Use the promo code Ramsey for a 15% discount at checkout. That's urgentcarekit.com slash Ramsey, promo code Ramsey.

Don't miss your chance to join us on the live like no one else. cruise. And don't put up a deposit, because I won't refund it if you're not going to go. That's a fact.

Following that call, I do a cruise ad with a deposit. Anyway, actually, it wouldn't be with me, anyway. It's with the cruise line. So you have to deal with them. There you go.

Because I love you, and I'd probably give you your money back. Not really. But anyway, I'd leave it up to the cruise line. So, seriously, there's not that many cabins or suites left. If you want to come, we're going to be doing this March, the 22nd through the 29th.

That's next year, of course, 2025.

. We're going to Turks and Caicos, St. Thomas, Puerto Rico, the Bahamas. 100% of the Holland America. first class, almost new ship will be Ramsey people.

It's going to be like a huge Baby Step 4 and beyond party on the seas. Lots of Baby Steps, millionaires, lots of debt free people screaming, lots of us doing events on the boat, talking about all kinds of things. All the Ramsey personalities, Dave and Sharon will be there to me and my wife the whole time. Plus Manit Chauhan from the Food Channel, Stephen Curtis, Chapman, Dina Carter and many others. We've got all kinds of lineup on this thing.

It's going to be a lot of fun. Just a handful of cabins. You can still get one and you can put down the key $600 deposit to secure your cabin. I don't know what the refund is on that. You'll have to check.

All joking aside. And check it out at ramseysolutions.com slash cruise. It's the first time we've actually done one of these. We attempted to do one and there was this little thing, this little disease thing, going around. It kind of ended the cruise back there a while back.

Fauci pandemic. Yeah, the Fauci pandemic got us. And so, you know, anyway, we're back on the high seas now and we're rocking and here we go. It's going to be a lot of fun. I'm just glad Sharon's coming to keep you in check.

Yeah, there you go. Because I'm known for being out of check. There you go.

Bria is with us in Seattle. Hey, Bria, what's up?

And ever since I started watching what you teach is lit a fire under me and I've just been paying off debt like a psycho person. So far, we've paid off a $10,000 car loan, about $5,000 in credit card debt. And the remaining debt that I have is $6,000 in student loans and a $1,000 medical credit card. I'm so grateful for your advice.

But now that in the next few weeks, my husband and I plan to pay off the remainder of our debt. You're incredible. Well done. Thank you. And while I would have imagined that I would be full of joy and full of excitement to be debt free, I just find myself feeling like there's just a cloud over my head because I can't seem to forgive myself for the debt that I racked up.

The credit cards were used for really dumb things like eating out and buying stuff that I wanted in the moment that wasn't necessary. And so my question is, is as we embark on applying for a home loan and just building our future, my question is, how do I forgive myself for falling behind on finances when I could have been ahead if I hadn't gone into debt? And how do I stop obsessing over my past financial mistakes?

Like that rings a bell in my life. And then you started making the necessary adjustments. And so I know for me, that was a lot of it. A lot of the mistakes I made, and I'm not saying this to make an excuse per se, but I just didn't know. I didn't know what I was doing.

And a lot of stupid is from ignorance. I didn't learn budgeting in school. I didn't learn financial management skills. And so there was a piece of it that I just didn't know better. But the key is once you do start to know better, if you don't start to do it, then it becomes, yeah, it's your own fault.

And so in your case, you're like, listen, I took this advice and I started running with it. And it's still very new for you. And there is a piece of this where you still have a longer period of time where you made the wrong choices. Therefore you don't trust your judgment. Then you've had time where you've been making the right decisions.

And I think the longer that you continue to rock, walk down this road and it kind of starts to even out and you start having more years behind you where it's like, okay, I'm doing the right thing. I can trust my instincts. Some part of that is just time passing. And then you just choosing to say, Hey, I didn't know. I know.

now I'm changing my life. And a lot of that is just you choosing that every single day to go. All right. I'm a person who understands that I'm a person who's responsible and that's who I am now. And that's how you view.

Yeah. I like that. Yeah. The way you rebuild, let's say, you violated trust with someone else, not with yourself. How do you rebuild trust with someone?

It takes time and it takes a pat, it takes a pattern of not doing the thing that broke trust ever again. Right. Right. And so, you know, how, you know, we have calls on the air here that sound like, um, my husband, uh, quit doing alcohol three years ago. Um, and I'm having, I'm having trouble trusting him, or three, three months ago.

And I'm having trouble trusting him with money. I'm like, well, you should have trouble trusting him with money. He's been dry for a whole three months. That that's reasonable. But if he, if he called me up and say he'd been dry for three years or 10 years and you're having trouble now, that's on you, that's not on him anymore, because he's demonstrated a pattern of not returning to the bottle.

When you're just demonstrating a pattern of not making the same mistakes that Jade said, then you build trust with yourself. You're rebuilding trust with yourself. And so, um, I have, um, done so many different things, financial and otherwise, especially in my stupid, misspent, hillbilly youth, um, that, um, that no human should do, but I did them and, uh,

Jesus forgave me in any way, even though there's no reason. And I can just kind of sit in that and not even understand that level of grace. And it took me a long time to get really comfortable with. the windshield is a lot bigger than the rear view mirror, for a reason. That's grace.

The rear view mirror is small. You look in it and make sure that, you know, nothing's coming up from behind. The past is not coming up to bite you again. Uh, you're looking in the rear view mirror to adjust your course, to make sure you're stay on track and never go back to some of the stupidity again. Um, but the big window is the windshield.

The rear view mirror is small because you don't have to spend much time looking back. You spend most of your time looking forward. That is forgiveness. And, um, once I walked into that, um, this sounds kind of goofy, but I forgave myself a lot faster than Sharon forgave me.

And, uh, she's still working on it. No, no, I'm kidding. She's not. I'm kidding. But I mean, you know, she was a terrified young mom with two little kids in the got cut off because of my stupidity and handling money, not her fault at all.

And so anytime that I even have that facial expression or that body language or that tone around something we're discussing that reminds her of that. And it's been 30 something years, you know, her, that wound inside of her spirit can open right up again and acid can gush out, but it doesn't happen hardly anymore. But I got to tell you in the first like eight years, seven years after going through that, she, it took her a long time to trust me again. And with good reason, absolutely. Because I was not trustworthy.

The more trustworthy you are, the more you are worthy of trust, the more you can say that other person did that. I'm not identified as the worst thing I've ever done. That's right. That is not my identity. It's just something I did.

And with every new choice you make, you're building that new identity. Yeah. I met a guy who has a fabulous life. He's very successful in business and very neat young man. Great dad.

When he was 18, he robbed a bank. You don't hear that every day, but he's a completely different human being. now. You know, he served his time a completely different human being. And so, yeah, just small mirror.

And step three, get reimbursed. CHM members take care of your eligible medical bills. Step three, with no network and the freedom to choose your healthcare provider, CHM is the best option for Christians who want to take care of their families and help other believers. Find out more at chministries.org slash budget. That's chministries.org slash budget.

How are you? Good. How are you doing? Better than we deserve. What's up?

So what I'm trying to do is I just want to work as much as possible, pay off all this debt, build up a nice emergency fund as soon as possible, and then just get out of there. I'm just trying to figure out what's my best course of action, because I want to keep the gazelle intensity. What kind of work do you do?

Right now, I'm doing HVAC. I just got hired on. probably about three months ago. I got through apprenticeship. I was going to take a loan out for $15,000, but I called around and I happened to get an apprenticeship.

So right now, they're starting off at $1750.

. But within two and a half years, I'll be making $28 with a double pension and all that stuff. Okay. And you're working 40 hours a week? Somewhere around there.

I just started working Saturdays. Well, they started letting me work Saturdays too. So roughly around 40, sometimes 47, 38, 39, somewhere around there. Okay. And she wants you to stay.

Well, it's my first child. We.

Is that what you're telling me? Right, right, right. Okay. I'm just trying to make sure I understand the dynamic of what's.

Yeah. Okay. So I disagree with the idea of you going to zero a month housing. I think that's a trap. And I think if you go there, you have the ability to get comfortable there.

And I think you'll limit your income because of that. I would not do that. I think that's.

Tell us your debt. I mean, because I was paying, because right now, what I'm living at, I'm literally making just enough to pay all the bills. When is the wedding?

The wedding? I mean, I want to get out of debt first. Why? You said why? Yeah.

Right. And when we say, just to clarify, when we say get married, like this, could be you going down to the state courthouse and getting?

No, it's not. If you wanted to do it, you'd have done it.

I don't think she's big, but- She's thinking about a.

Because right now, it protects everybody. Because right now, she's just living in your house with her two kids. And she's the one carrying another baby. She's the one at risk here. So you, marrying her is an act of love that protects her.

I think you ought to be working all the time like a madman and get the mess cleaned up to provide for this young family that you have now committed to and created. Okay. So you have a child that's yours and two stepchildren. If I woke up in your shoes, sir, I would get married this week. And if we want to have a party later, when she's not carrying a child and not, you said big, you know, she wants good, nice pictures or something, that's fine.

We'll have a party and a celebration later, but let's get married and establish for this child. When this child is 30, you can look at them and say, when you were born, we were married.

Okay. You're calling me up trying to get out of debt with gazelle intensity and you're crawfishing like nobody I've ever seen on getting married. So if I woke up in your shoes, I would go get married. I think that's a bigger part of the discussion here than whether you work a few extra hours in the next nine weeks.

You do need to work, but at least-.

We might put her on the street in that case.

I'm not hanging out with somebody telling me not to.

So that we can go into this with the right relationship, with the right protections in place. No one even knows you have the certificate. If you want to keep it a secret, who cares? And have the party later. Surprise, surprise.

because it sets up. then, okay, now my wife and I, and our baby on the way, and her two children from a former relationship are our family unit. And it is now my job, honey, to go and provide for this family unit. I know it's difficult right now, because you've got a baby coming any minute and you've got, I mean, my daughter-in-law's getting ready to have a child any minute. And she's got a three-year-old who's, you know, that's more than anybody should have to deal with right there.

That right there is enough. Okay. And your wife's got two sitting there on top of this. And it's she's, I mean, because I know, because grandma and grandpa have been picking up the three-year-old and getting her off it, because she's driving everybody crazy. So he's driving everybody crazy.

She's not. But so, you know, that's what all this dynamic is going on. And she feels like you've left her at home to deal with all of it. And so I think what we're talking about is woven into this and then sit down and go, okay, I'm going to help you with these kiddos. And I'm going to work like a maniac.

Yeah. So let's figure out how I can do both, because we've got to get up and get out of this mess. Yeah. And we got to go to where, 10 years from now, we look back and go, well, that was the start of a whole new, wonderful life. And it, because Juwan ain't afraid of work.

That's a big deal, Juwan. You ain't afraid of work. You can go win, brother. That's a big deal.

But other than that, oh my gosh, this is the Ramsey show.

I've been doing this show for over 30 years, and some of the saddest calls I've taken are from situations that are completely preventable. Yeah. And what's so hard is, I feel like one of those,

In the middle of all that grief, like it's just, it is, it's terrible. And so life insurance is the one thing, especially as a mom with three little kids, that I'm like so big on for people to get because it's inexpensive. Zander is the place that Winston and I actually get all of our life insurance. And it doesn't.

to get a free quote, call 800-356-4282, that's 800-356-4282, or go to Zander.

com.

Jade Walshaw, Ramsey personality, is my co-host today. Open phones at 888-825-5225.. Jason's in.

Thank you for taking my call. Sure. How can we help? All right. So I may break down a little bit on this one.

So I'm getting ready to inherit about $185,000.

. Who passed away? Following baby steps, my dad. Oh, I'm sorry. When did he pass?

Just about three weeks ago. I'm so sorry. What happened to him?

He was in Vietnam. So Agent Orange got a hold of him and throughout the years, just dementia, prostate cancer, amongst many others. How old was he? He just turned 81..

So he turned 81 and seven days later he passed away. And you're getting $185,000?. Yeah, through cash and life insurance policies and a few other various things. We're estimating it somewhere between $170,000 to $190,000.. About $185,000 is pretty close.

Okay. And I interrupted you, but I wanted to know more. Thank you for sharing that. I'm sorry for your loss. I appreciate that.

So my biggest question is, I'll start with the question and then we can go from there. My biggest question is when it's all said and done, after following the baby steps and everything else, would it be acceptable to take some of that money and purchase a newer truck? I currently have a truck that I owe about $4,800 on it. still. Our only other debt is about a $2,900 credit card.

We'd be able to have a fully funded emergency fund. I've been doing 15% investment for quite a while. We adopted two kids in 2022. So the state gives us a subsidy from there. 100% of that subsidy is being set aside in the 529 for their college.

So that puts us pretty close to step six. What's left is not quite enough to pay off the house. We plan on investing quite a bit. We plan on setting some money aside for future home improvements. And so my question is, would it be acceptable to

Okay. Yes. You don't have an emergency fund in place yet, correct? Uh, we've got about $3,000.. You don't have an emergency fund in place yet and you started baby step four without that being done.

So you're not following the baby steps and you've got debt of $2,900.

. So you've not been following the baby steps already. So if you want to follow them, we can show you exactly how to do that. But then you've got to say, that's what I'm really doing. You can't sorta, you either is or you isn't.

Okay. And so you isn't right now. So first thing is we pay off the $2,900.. The second thing is we fully fund the emergency fund. And then, as you said, four and five are already underway, which brings us to six.

But what we teach is when you're in baby steps, one through three, which is getting out of debt and having the emergency fund, you're intense and you don't buy anything. You don't do anything until you get the emergency fund in place and they're out of debt. Now you're going to accomplish that in one fell swoop here. Then, when you're in four, five, and six, you move from intense to intentional. And that's when you would use some of your money to upgrade a truck, buy a couch, go on vacation and put the rest towards baby steps, four, five, and six, the house, not invest some of it.

Now. what's this? home repair or remodel future thing?

We had debated about 50,000.

. Of landscaping? No, no, no, no. I'm talking total home improvements because we're looking at possibly redoing the driveway. There's painting or siding, the new gutter.

Let's just round that and call it 10,000 bucks. You're debt-free and then you need another 15 in your emergency fund. That's 25 out of the 185.. That puts us at 160,, I think, out of 185.. I just spent 25 to get you through baby step.

What's the balance on your mortgage?

. This year, I'm looking at anywhere between 110 to 115..

for the fun of it. That would put you at 40, but 30 is going to be fine. That's enough. I'd move you into a 30 truck. You need 18 more to do that, because you got a 12 truck.

We're going to upgrade by 18 or 20,000 bucks in truck. We'll make it 20. for the fun of it. I can keep this in my head. 160, that's 140 left.

Then, if you're going to spend 40 on the landscaping and home improvements, that leaves you 100 to throw towards your mortgage, and you only owe 80.

You don't do investing. You throw all money above 15 percent at baby step six and above lifestyle. You're using some of this for lifestyle, a little bit on the house and a little bit of upgrade on truck. You're cleaning up some of your earlier baby steps right quick. Then you're going to throw the rest of it at the house.

That's what I would do. That's what we would teach. That's following it to the letter.

Then how quick are we going to pay off 80 grand on the house, making 100 with no payments in the world and living on a tight budget and watching what we're doing? You can still go on vacation. You can still go out to eat. You can still enjoy some of your money. I want to start throwing some money at this house and be done with this house in three or four years.

That sounds good. That sounds like a plan. How old are you? I turn 50 here in two weeks. What's the house worth?

. I just started this job about two years ago, so I've got about $30,000 in a 401K.

Based on that, at about 55 years old, you'll be a millionaire.

Good. If you do what I just told you to do. If you keep screwing around with some of this.

Yeah. If you go back in debt after this, you're dishonoring your father's memory.

Well done. Appreciate the call. This is The Ramsey Show.

Cryptocurrency. See what I mean? And that's why I love the Ramsey Network app. It is the best place for uninterrupted, easy access to the content that keeps you focused on your goals. It's all Ramsey all the time, which means you don't have to worry about getting off track.

And with over 7,000 hours of Ramsey content, yep, you heard that right, 7,000.

. This is your one-stop, single destination for advice you can trust and nothing you can't. So do yourself a favor, get rid of the distractions and dial things in. All you got to do is search Ramsey Network app in the App Store or click the link in the show notes to download the Ramsey Network app today.

Hi, Matthew. How are you? Oh, I'm fantastic, Dave. How are you? Better than I deserve.

What's up?

We're currently using all of our income to pay off the cars, but we're wondering if we should use what we have to put money down on a house. No,

. So how quickly can you pay them off if you just pay them off before you buy?

You just got house fever?

Yeah. Well, my brother, who I'm very proud of, who actually introduced me to you, he just sold his house and got $160,000 in equity, and he's able to move with his wife down to Florida. And we thought, wow, you know, we're paying X amount of dollars in rent right now. What if we took the next six months and started paying towards a house while we're paying off our cars? But then we're like, wait, won't that stop us from paying off our debt and paying off a house and getting to our goals?

Wouldn't that make it take longer compared to just paying off the cars? Yeah. That's why we have the baby steps.

And you think that if I get that car debt taken out completely, I don't.

. We probably could sell our cars, but I think... I don't think you need to.

It's not time yet. I hate to tell you that, but it's not time yet. No, that's really good to know.

If you go in that order, if you go in a different order, it's going to slow you down or even set you back substantially. But the number of months between now and you having a net worth of a million dollars and owning a home and having money going into your 401ks, the number of months, the shortest number of months of doing it, the way we're talking about, it's not trying to do everything at one time because someone else.

My question is, is whether getting something like a car shield, which is a insurance against car maintenance, is a good idea, given the fact that what I do for a living is DoorDash and UberEats?

It's a horrible idea. Okay. Here's the numbers on extended warranties and car warranties.

85% of what you pay for a car warranty does not actually cover the math of the potential loss. The potential loss is covered by 12 to 15% of what you pay. So if you pay $1,000, you basically, on average, are going to get $150 worth of value. The other 85% goes to profit, to commissions, to marketing, and more marketing. And if you're buying an extended warranty, folks, for there are others out there, not, Aaron, but if you're on a car lot and they're trying to sell you an extended warranty, the car dealer very well may be making more profit on the extended warranty than they are on the car.

That's how bizarre these things are. The math on it is what they pay a car salesman or a car dealer to sell you an extended warranty, as a percentage is huge. It is more than the actual cost. So, Aaron, anytime you open an insurance company or a warranty company, you build a table of statistics. Okay.

It's called an actuarial table. And if you're opening a life insurance company, you say, all right, number of 60 year olds out of 1,000 60 year olds that are healthy, how many die in a year? And then you can back into the mathematics and say, here's what it costs me to provide life insurance. if I'm a life insurance company to a 60 year old. And that's called, that's a statistical table.

Does that make sense? And you do the same thing. if you're opening an extended warranty on a car or a home warranty or anything like that. You say, all right, I'm going to cover brakes, drivetrain, engine on a, what's your, what's your car and what are you driving? A 2012 Ford Fusion.

Okay. A 2012 Ford Fusion. If I cover a thousand 2012 Ford Fusions, my cost on average to two of the things I cover, the number, number of people out of a thousand that are going to bring me claims when their car breaks down, my cost on average is going to be X. And that X is somewhere around 12 to 15% of what they're trying to charge you for an extended warranty. And so meaning that on a law of averages, you could break down twice as much as average and still spend half as much as you pay for the warranty.

Wow. That's the, that's the actual.

100%. Yeah. You're going to, you're going to have to literally put wheels on the car, tires. You're going to have to put brakes on the car. And you're going to have to run more oil changes, and you're going to have more and more miscellaneous odds and ends.

More than anything else, though, Erin, you're losing value in the vehicle, because miles cost you value. So you run the miles up your value, you're, you're deteriorating your value very rapidly. And that's an unseen force that doesn't hit your checkbook until you sell it. But that, you know, you put 200,000 miles on this car, you trashed its value. And that's the other, that's the, the dirty little secret of door dashing.

True. This is the Ramsey Show.

Comparison is wired into us, but comparison can also become the thief of joy, because we can feel like we're not enough and begin acting and thinking in ways we would never think otherwise. When all gets to be too much, think about contacting BetterHelp. BetterHelp is a hundred percent online therapy staffed with licensed therapists. It's convenient, flexible, and suited to fit your schedule. And, by the way, therapy isn't just for those who've experienced major trauma.

It's for all of us who are ready to get out of the comparison spin cycle and find our own peace and joy in the life we're creating. Stop comparing and start focusing with BetterHelp. Visit betterhelp.com today to get 10% off your first month. That's BetterHelp, H-E-L-P dot com, slash Deloney.

So, with that said, what is my situation right now? I have about $50,000 in the stock market, and that $50,000, I'm using the stocks that I have to put covered calls on my stocks. Therefore, it generates me about $2,000 per month, being very conservative, right? And I'm a little divided, because I can put that money back into the stock and make even more, put more contracts onto that stock and make more money, or I can direct all that premium that I receive for the stocks towards the payment of the car and the house. So I would like to get a perspective from you, what would be the best way to go about that?

I don't think you have any concept.

Okay. You've hit with your covers. You haven't had a problem yet. And as soon as you miss one of those covers, you're going to realize that $2,000 is not your worst case scenario. conservatively.

A negative $10,000 is your worst case scenario. Right. You're playing dice in Vegas, and you feel like you're taking no risk at all.

If you miss the cover,

78%, statistically, 78% of the people who day trade stocks lose money.

That's eight out of 10.

. Okay. Okay. So I don't, I do not day trade stocks. I don't do puts.

I don't do calls. I don't do options. I don't do covers. I don't do commodities. I don't screw with any of that stuff.

I like the money that I earned too much to put it that much at risk. No, thank you. And I also don't play the roulette wheel in Vegas. So, um, right. And they're all right.

They're about the same level. So what would I do if I were in your shoes, I would sell a $50,000 in stock this instant, pay off your car, build your emergency fund, make sure you're putting 15% of your income into retirement. But, Matt, you're like the guy who walked in, walked through the, uh, lobby of the, of the, uh, of the casino, and dropped two quarters in and hit. Yes. And you end up putting your whole freaking paycheck back in trying to replicate that bogus luck that you had.

That wasn't luck at all. It was them playing you and that, you know, you, you, you haven't, you haven't, you haven't bled yet from this. I can tell, because you think it works every time. And so it doesn't work every time, dude, I promise you. That's not how, that, how that business works.

Uh, and so, you know, um, you're, you're risking and risking, and risking and risking, and risking and risking and risking with money. You don't have really, cause. you're broke. You got $10,000 in debt. You don't have an emergency fund.

And, um, you know, if you've got $2 million in, in net worth and a bunch of money laying around and you want to goof off with 50 grand and screw around with it on the roulette table, or screw around with it, uh, doing day trading, that go ahead. I got a friend of mine that does that. He thinks it's entertainment. I don't, you don't do anything. I'm doing anything.

I do not own a single, single stock. That's so cool. If someone handed me one today, I would sell it. And it's because I'm such a nerd. I know the probabilities.

Yeah. I know that if I, the moment I start thinking I can do a better job than a billion dollar mutual fund at analyzing stocks, the instant I think that is the instant I'm wrong. Yeah. And I just don't do it. I, and consequently I've got a lot of money, cause I don't lose it all the time.

And so that that's the deal. So, Matt, you're, I hope we're giving you a little something to think about. I don't know if we are or not. I, cause I don't think you're in a very good place to hear this, because you're at, you're at the stage where you think you've got it figured out and everybody else is dumb. And, um, that's a bad stage to be in.

That's right. before you lose a bunch of money. So I hope I can just scare you a little bit and you'll go ahead and stay away from this. But I don't know. Usually you got to lose some to figure it out.

At least I lost five grand on a, uh, a gold option. I took an option position on gold back before I went broke and I had some money, I had a lot of money flowing in. I was in my twenties and a buddy of mine came to me and he goes, Hey, this guy has been picking these gold prices. And we'll set our option number. And if y'all don't know how option works, you have the, I had the option to buy the gold at X.

And if it was above that, I could, that option was going to go 10, X. I would have made 50 grand off that five grand. Okay. And if you, if the option number doesn't go above that, you lose a hundred percent of what you put in. So it's either, I either got, I don't give five grand back.

I either get 50 grand or zero, but this guy hit 12 times in a row. He predicted the option prices. So me and my genius beer drinking buddy decides we've got this thing figured out. Cause, this guy's got it figured out. We're going with this guy.

Cause he's got a pattern going. He's got this thing figured out, bull crap. And so I put five grand up and you know where this is going. Yeah. I lost the five grand, but I have a rule.

I don't do stupid stuff two times. I only do stupid stuff once. Fair enough. So I've already got that one out of the way. That's fair enough.

That one's out of the way. I don't ever have to do that stupid thing again. And then I get to tell Matt, please don't do it.

I learned from it. Right. Then you've got the stupid decision where everyone's telling you, Hey, if you do that, you'll die. Like, don't do it. I've tried it.

This is what happens. And then you go and do it anyway,

So, Matt, I hope, I hope we give you something to think about, but, um, I, I, well, I hope we did just leave it at that. Stephen's in Knoxville. Hi, Stephen, how are you? Hey Dave, I'm doing good. How are you?

Better than I deserve. What's up?

come out with about, um, between two, 50 and 300,000.

. You have a paid for home. No, no. So that is the other thing. We got the, we got the house just.

Or so, if you sell the house, you put them. Okay. So if you sell the house, you put a quarter million in.

Um, so yes. Um,

so we, this year are bringing home about 112.

. Okay. What in the world did you get your post-grad in? Um, so my wife, I got mine in advertising as an undergrad. I only had about 13,000 in student loans and my wife has the rest and she, uh, has her doctorate in psychology.

But I would not sell you, I would not sell your house. unless you just hate it. I would roll up my sleeves, live on nothing on. both of you get to work as fast as you possibly can and get this student loan debt cleared up. No excuses, no reasons.

You need to get it cleaned up. Uh, if you want to sell your house and live in a rental, um, and be debt free, you can do that, but you're still going to have to go make some money to justify the expense that both of you went to. This is the Ramsey show.

There aren't many places you can save hundreds of dollars a month and still give you great service, especially with health insurance. That's why Health Trust Financial is the only health insurance company Ramsey recommends. Health Trust Financial objectively compares the top health insurance providers to meet your needs and budget. And remember the service is free and there's no commitment. Go to health trust financial.com health trust financial.com.

Buying a house in this weird real estate market is weird.

Selling a house in this weird real estate market is weird. If you want to navigate weirdness with one of your most expensive, if not your most expensive asset, you probably need a pro in your corner who's done it before. Not your Aunt Sally, who got her license to sell real estate three weeks ago because she thinks it's fun. No. No.

Sorry, Aunt Sally. You want a pro who's high octane, high protein, that does hundreds, if not close to a hundred, transactions a year, and that's the only way you would get to be a Ramsey trusted real estate agent, an endorsed local provider. that, and there's thousands of them across America that we have vetted. We've done the due diligence on them. They're the people that get her done.

They leave the cave, kill something and drag it home, baby. And if you want that kind of real estate agent in your corner to help you buy or sell, just go to ramseysolutions.com slash agent to find a Ramsey trusted real estate agent for free. Pedro is with us in Chicago. Hi, Pedro. How are you?

It just makes me mad. And I'm, I'm considering three options, uh, filing for chapter 13, bankruptcy. I don't care if the credit goes bad. We don't ever plan on taking any credit, or ever again. So it's not a concern for me.

Negotiating with the credit cards for a lower, uh, pay off of the credit cards or the third one, just, just forget everything and just attack them with gazelle intensity and pay them off. What would you recommend?

She will not pass that because she has the means to pay this. She just hasn't, because she has a spending problem, which is your bigger problem than the 76,000 you're getting ready to marry a woman who doesn't know how to stop spending.

We'll get on your program and we'll pay it off. And I'm pretty sure.

So I know, but you can't muscle this.

Yes. Yes. That's called repentance. And that's a chance of turning this around. If she said, well, it's just the way life is.

You're screwed. No, no, no, no, no. She, she,

So.

Okay. That's simple. That's simple. It's not about credit. It's about, she borrowed the money.

It's about your wife's integrity. She has the money to pay her bills. She should pay her bills now that she's marrying you and has a system and your income to add to it. And, uh, by the way, she had the money all along to do something towards this and to not continue to dig this hole. She's not a victim.

Uh, she chose to spend more than she makes. She doesn't make a lot of money, but she chose to not live on that to the tune of 76 grand. And so, um, you know, these are very concerning things in a second marriage and you're coming back in and you're sound like a lot of years in between the two times you've been married to her. And we'll, yeah, a lot going on here, brother. Uh, you probably ought to sit down and spend some time and do some good, in-depth pre-marriage counseling and dig into this.

And this money piece is part of the things that we discuss as we do that, just to make sure that we're, we're, I'm not saying you guys can't make it. I think you can make it because I think you're a strong dude. Uh, but, but I would want the information that a good counseling session or two would give me.

Are you interested in paying off the debt you have? Are you interested in going back into debt or do you want to avoid it? That would be my first question.

Second question, probably we'd be something around the lines of what, what's your philosophy on combining money? Is it yours versus mine? Is it ours? Do you trust me enough to combine? Like?

I'd want to know about that. And I'd probably want to know. their spending slash, saving inclination.

Okay. So let me add, let me add that in there. But if you were doing that and a good pre-marriage counselor, one of the things I would always put in there as a practice budget, Oh, that's good. Where you act like you're married and say, okay, here's all of our debt. Now it's ours.

Here's all of our income. What does this month look like? And then that exposes what the philosophies are on debt, on saving, on spending and on lattes and whatever. Yeah. Well, everything but pumpkin spice, you know, it's like, yeah.

All right. So, um, uh, so you know, everything, but my nails, you know, or I don't know, or what is the guy, everything, everything, but me buying, going, hunting, I have to get a guy in there, right? Golf clubs. I need a golf. I got everything, but my, my, my, uh, the club fees, I can't drop my club fees.

Yeah. So, yeah. I mean, you, you, you really get into what's what the deal is. All right. So, yeah, a good practice budget, because we do know the numbers as well.

And this is a very high probability that all the marriage data tells us if you're agree in agreement before marriage in detail on four areas, your probability of making it. as in the 90 percentile, money is the number one cause of divorce, money fights and money problems. So if you're in agreement on money, you got number one out of the way. That's right. Kids, how many to have?

and who runs the house after you have them? The kid or the parents? Ah, how we raise these. Yeah. How do we raise?

is anarchy going to be the deal here? Okay. Uh, in-laws and crazy people in the family, how are we going to deal with the extended family? Is mama still going to tell me how to cook?

Nope, nope, nope. And religion. That's a biggie. Unequally yoked. If you're in agreement on religion, money, in-laws and kids, you have a very high probability of making it.

Okay. There you go. This is the Ramsey show.

Download every dollar for free on the app store or Google play. Remember today, download every dollar for free on the app store or Google play today.

Jade Walsh, our Ramsey personality is.

And it's not the first time we've refinanced or sold our houses. two other times to clear his debt. I'm embarrassed to admit that I found myself scouring the couch cracks for enough quarters to buy a gallon of milk. He recently maxed out his credit cards and then took out an annuity to pay them off. He has sold my paid off car so that he could pay off debts.

He comes home with something new whenever he pleases. About a year ago, I opened my own savings account. I'm afraid that our marriage will crumble and I'll need to move out. I even went back to school to finish my degree so that I could support myself. If we separate, I have always stayed debt free and saved what I could.

I feel disrespected and fear that our family is at risk at all times. At this point, I'm so full of resentment and distrust that I'm constantly angry and anxious. What should I do? Well, yeah, you've got a problem. It's beyond a money problem.

He's, it's looking like a money problem, but it's beyond that. He's got a lot of problems. And the fact that you've already separated yourself to the extent that you have, you've, you know, you're looking at, you're looking at a life without him and you're getting your education to do that. You're setting aside money to do that. So in your mind, he, there is a line that he's crossed a long time ago.

And it sounds like you're in this position where it's like, once I get my footing, I'm out the door. And I don't know what you guys have talked about in way of counseling. You know, I, I kind of have this acronym. when you're in these situations. I always say it's, it's a safe acronym about keeping your money safe.

And it's the S's you need to seek counsel. If you are experiencing things like a addiction, abuse, F, financial infidelity, right? Those are the times that we seek counsel. And then from there, the E is. you need to evaluate your options.

What is it? Is it me having to separate funds for him in order to keep myself and family safe for a while until, you know, the right counseling has taken place and we've seen evidence of change? is that I've got to get myself in a safe environment if there's some sort of abuse. So it sounds like you've already started implementing that, but I don't know about the counseling. That's the one thing I haven't seen here.

And that's going to be paramount for you guys. If there's ever even a chance of this working out, because he's a child, and I'm wondering if you're racking up this kind of debt, Dave, correct me if I'm wrong. It's something going on 125,000 in non-housing debt. And this is happening more than once. I got to wonder if there's anything going else with another lifestyle.

If there's some sort of addiction, I just don't see how you can do that. And you're looking for money for a gallon of milk. Yeah.

So, Susie, your marriage is over.

Now, the only question is, can it be healed and put back together?

The only shot at that is to get some professional help, because I can tell from reading this that you're done, but you don't even realize you're done. She's done. Stick a fork in it. You're done.

And really, with what you've described, no one listening is blaming you. We're sick of this guy, everybody that read this with us. So you're done. Now, can it be salvaged? Yeah, it can be.

Probability is fairly low, because two major things have to happen. He's going to have to change and you're going to have to change. And you guys got to have some help doing that. So get in touch with a marriage counselor. He likely is not willing to go to marriage counseling, but you need to go, sit down with one and then they can give you words and phrases and give you clear thought on exactly how this is going to go down.

But normally the way this would go down would be you would sit down with him after meeting with a counselor and say, I'm not willing to live like this anymore.

Period.

If you will not go to marriage counseling and you will not go to Financial Peace University with me and you will not live on an agreed budget, and you will not quit spending more than we make and crashing our lives continually, I'm done.

That's probably what the counselor is going to instruct you to say. It's called an ultimatum. And then let's see if that gives Bubba the wake-up call. Because this is one seriously immature dude.

The axis of the world runs straight through the center of his head. He thinks the whole thing revolves around him.

And he's a baby child. And so if a baby child can wake up and go, I'll do anything. I'll do anything. I don't want to lose you. Yeah, well, we'll see.

Because you're about to do a lot of stuff that you've never done in all these years. And that's called grow up, be a man, learn to delay pleasure, learn to live on less than you make, learn to agree on spending with your spouse, have a written, detailed plan, save money, don't just spend money, invest money, don't just spend money, be generous to other people other than yourself.

You selfish little immature, jolly. And so he's got a lot of changing to do. And you've got, you've put up with this for so long, you've become accustomed to crazy. And you kind of think crazy is normal. So you've got some changing to do.

Because crazy ain't normal. This what you're describing is not normal. And I'm a little bit aghast that it took you this long to wake up. There's something broken in you that caused you to wait this long to wake up. So sit down with a coach counselor.

And because I'm guessing, baby child's not gonna go.

And then you can, you can go back home and explain to him, with the TV off and the kids in the bed, that this is what's going to happen. I'm going to pack up and I'm going to leave if you don't agree to these terms. Because I'm no longer willing to live like this. And something along those lines is going to be the process and marriage counseling, financial coaching and counseling like Financial Peace University, a written, detailed budget. And, for this point forward, agreement on every dollar that goes out the door.

Yeah. And I'm no longer going to scrounge on the couch after all these years. and how much money we make for a gallon of milk. That's asinine. And I'm not going to live like this.

And see, the problem is you, you never even said that, except in your head. And so now you've got to have some coaching on how to sit this down. Because you're, you are going to put your marriage on the line when you make this statement, because if he does not change, then you will be required to walk back out and be done. You've got to make a decision. Because if you decide to stay in crazy, then you're just part of crazy.

That's right. You're just crazy, as crazy is there. And everybody gets crazy. So yeah,

And he decides I'm going to go along with reasonableness and a plan. And we're going to heal this and turn this around. I've seen things worse than this.

And the money will be, that's true. And then three or two for her. She's got a like. there's a side of her that the forgiveness on this is tough. And the ability to go.

okay, we're starting a new thing. I've got to hold up my end of the bargain. I can't keep holding old stuff over the head. But at the same time, I have to let that in. Like.

that is a very hard line to.

Career savings account. You've already ended this in your head. You've just not actually had the courage to say it out loud. And you to yourself, even you've just taken these little steps to kind of like prepare as if there's a storm coming that might not hit. Well, the storm is already here.

The damage is done. You got to do it. You got. you're gonna have to deal with this head on, or it's your only chance of saving it. Wow, I'm so sorry, honey.

What a mess. This is the Ramsey show.

Live from the headquarters of Ramsey Solutions, it's the Ramsey show where we help people build wealth, do work that they love and create actual, amazing relationships. Jade Walsh, our Ramsey personality, is my co-host, number one bestselling author. today. You can call us at 888-825-5225.. Christina starts off this hour in Pittsburgh.

Hi, Christina. How are you? I'm good, Dave. How are you doing? Better than I deserve.

What's up?

When you buy health insurance through an insurance agent, the health insurance company pays the agent, the commission. You should not have an additional commission on top of that.

So how do you feel about insurance brokers? Are they necessary?

Oh, my gosh.

the number is. Okay. And when you send them a note and you say, hey, I want to buy life insurance. Here's my age, my medical condition. They shop among all the different companies for your situation and get you the best price for the amount of insurance in your situation.

And then you buy it through them and that company pays them a commission. You simply buy the life insurance. And that's the way health insurance works too.

So I thought that would be a good thing, because they called me and I was like, oh, that sounds like a good deal. And I guess I should have called my dad first.

And they're not, it's called what again?

If you do, the health insurance company pays them a commission. Okay. Okay. And they can help, they can help you get, they can help you get some cheap coverage in your situation. Shouldn't be that bad at 24 years old, even with a baby.

Okay.

There's a lot going on. So what we used to have, folks, I'll go ahead and explain it to everybody else out there. We used to have endorsed local providers. We had health insurance agents everywhere, all across America. And basically the health insurance business has almost collapsed.

There's very few operators left after Obamacare. It put most of them out of business. And so this guy has been doing, has been, what was one of our largest ELPs back in the day. And he formed Health Trust Financial, and he's got a group of agents around that serve people and he's been able to navigate and stay alive and make a living and help people after Obamacare, where most of them weren't able to. And that's, that's why this all changed.

Cause we used to just say, go to Ramsey solutions.

com, click on health insurance, ELP, and you'll find one in your area that is an insurance broker and they'll shop it for you and get you the best deal. That's what we did for 15 years around here. And then the, it's taken about a decade for the Obamacare to completely, basically destroy the health insurance world. Took out 90% of it or so. So it's, it's a mess out there.

But anyway, this guy, they do a great job. They're good people. And in this environment, they're going to get you the best possible deal. So I'm proud, proud to endorse them in this situation. So, very cool stuff.

Natasha's in Tampa. Hi, Natasha. Welcome to the Ramsey show. Hi, thank you. I'm excited to be here.

So basically, my question is when should my daughter get a bank account?

Uh, the only thing was they did not have free reign. Uh, old dad was checking it all the time to see what you were spending, where you were spending it, how you were spending and that you were managing the account correctly, because this is not a right. This is a teaching aid. I agree with that. I had mine at 16 when I got my first job.

I had one at 12 and kept a full checkbook because I was running a lawn care business and my parents taught me how to do that. And so what a blessing. And then we actually, and back when the dinosaurs roamed the earth, there was a class in high school called general business and they would teach you how to actually reconcile and do a hand kept checkbook back when people did that. This is long before the digital age, boys and girls, but yeah, but anyway, yes, yes, yes, yes, yes. And yes, but it's not an entitlement and it's not a right.

It's a teaching tool. Like when a teenager has a job, it's not their money. Well, they earned it. Nah, they just, I allowed you to work and earn some money as a teaching situation. Yeah.

They don't get to go do whatever they want. You don't get to go do whatever you want. You get to do whatever you want when you pay all your bills. Okay. And don't live here anymore.

That's the only time you get to do whatever you want. This is the Ramsey show.

Listen, tickets for the live like no one else. cruiser selling fast. This is the ultimate debt-free vacation. And I can't wait to celebrate with all the folks who've worked their butts off and changed their family trees. We will be sailing through the blue waters of the Caribbean with the Ramsey personalities and other special guests.

A bunch of cabin options are already sold out. So hurry and reserve yours with a $600 deposit today at Ramsey solutions.com slash events.

Are you married?

The number one cause of divorce in North America today's money fights and money problems.

Number one disagreement. If you get money disagreements out of your marriage, for most of you, it completely changes everything. Because when you agree on your spending, you're agreeing on your dreams. You're agreeing on your values. You're agreeing on what comes first, what comes second, which is your values, represents your values.

You're agreeing on your fears. I'm scared of this. I got to spend some money to cover this. When you agree on all of those things, you're agreeing on your life. You're adding a level of unity, a level of oneness to your communication and to your marriage that nothing else will do.

And it's a stupid budget. It's a spending plan where you agree on it together. The easiest way to do that is the world's best budgeting app. It's called every dollar. It makes it simple to plan your spending and simple to work with your spouse, and simple for both of us to hold each other accountable.

that we've actually stuck to the freaking thing. Did we really do it or not? Download every dollar for free in the app store or Google play. today. Doing a budget is by far the number one indicator of someone who's going to become wealthy.

By far. It's not your income. And it's a big time communication tool on marriage. You know, here's an interesting stat. This is an old one, but I would imagine it's still fairly accurate, because you don't hear this one very often.

I read this a couple of years back in red book magazine. That's how old this stat is. Okay. Ready?

97%. That's all of them.

of ladies wish there was more communication in their marriage. Bingo. If you want to have communication from a guy, ladies, let me tell you one thing that guys speak. Most guys speak budget. We speak numbers.

We speak decisions in the household around the numbers. And this is a, instead of, I just wish we talked more. How about? let's sit down to a budget. By God, there'll be some talking.

Interesting. There'll be some communique. You might not like all of it, but there'll be some communication. I'm just saying it's a common, and that's a big deal. Every dollar.

you can download the app for free in the app store or Google play today. Judah's in Atlanta. Hi, Judah. Welcome to the Ramsey show. Hey, thanks for having me.

Sure. What's up? My? we've got over $150,000 in debt and we are on the every dollar app. Now we're budgeting for the first time in our life, but my question to you, that's credit card debt.

We are, we have a plan to pay it down, but I wanted to know if that's the best plan for your recommendation, just to be on every dollar.

Yeah. So have you adjusted your lifestyle to under your income? Yeah. We're, we're back up. We'll make upwards of that four or $500,000 now that we switched back to the same type of field.

But what do you do? We're both in construction. Okay. So can you pay this off in a year? Sales?

No. Why not? It's sales. So our, we have to build our pipelines back up. What are you going to make in 2024??

120.

. What are you going to make in 2025?.

220, 250.

. Okay. All right. That's the thing. Okay.

Because if you're making 400, you pay it off in a year, but you're not here. Okay. So, all right. So the, the deal is this, you can't out earn your stupidity. You also have to have the processes and the systems in place, which is why you're wise to ask the question that you've asked.

Way to go. You're really good at making money. You suck at handling it. Agreed? Agreed.

Okay. So now we're going to be on a budget and the two of us together are going to be in agreement. What we were just talking about before we picked up with you. And, um, and our agreement is we're not doing anything until his debt's cleaned up. We're going to cut up every single credit card.

If you haven't had plastic surgery, now's the time. Yeah. A lot of them are metal. That's all right. Destroy them.

Yeah. Get a sawzall. Heavy metal. You're in construction. You can figure it out.

They just, they get, they die today. Okay.

You don't keep a single credit card. Agreed. Agreed. They say these are snakes. They bite.

They've bitten you. Don't play with snakes. Okay. Now, we're both, we're both in our thirties. My reason for asking, cause the idea of, of, you know, accumulating all that together, bankruptcy, has even crossed our mind.

You're not bankrupt. You're not bankrupt. You're just out of control.

Here's the thing. What we look at is a shovel to hole ratio. You have $160,000 hole with 120, 220, $320,000. shovel. Agreed?

Agreed. This is doable. Yeah. This is doable. This ditch can be dug out.

Okay. This is not a problem. This is, it's just, it's going to mean that you live on beans and rice, rice and beans. You don't go out to eat and you work all the time and you don't go on vacation. and you're going to clean this up.

And, based on the numbers you're giving me, it's going to take you about two years, two and a half years. The faster your income goes up, the faster you'll be out of debt. How much can you control the speed of your income coming up? A lot. We're both, we'll both make over $200,000 in the next two years.

Good. Yeah. Well, you said 220.. You said 120 to 220.. That's me.

Oh, okay. That's just you. Oh, wait a minute. Slow down. What is the household income going to be in 24??

24, probably 250.

. All right. All right. So let's put, let's live on a $75,000..

Pay most of this off. Yeah. Yes. Yes. Okay.

Yeah. But that's, that's something you've not done in your entire lives so far. Right. Correct. Yeah.

That's what, that's the answer to this. Here's the, here's the numbers we know from coaching people in these messes. The more radical you get, the deeper you sacrifice, the faster you get out. And here's the key. The faster you get out, the higher the probability is you actually do it.

You don't quit. Right. And so it's a rip the bandaid off thing, not peel it off slowly and let every hair come out of the.

And I'll tell you the hard thing for you guys, which you're going to do it, but we get basically two types of calls. The folks who it's like, listen, your income's low. You got to get your income up. You got to bring everything up. Right.

And then there's people that fall in your camp, where it's like, you've had this high lifestyle. You're making 400,000 a piece a year, 400,000 a year. And you're having to bring it down. I, in many ways, I feel like that's tougher, because you're used to a lifestyle. And for you guys, it's, Oh, my gosh, I have to live on 75 when I was used to living on 400..

So that's the part. behaviorally, that's going to be difficult for you, but you can do it. You just have to know that that's what you're up against. And that's what you're facing.

If you permanently change the patterns, and this is basically a neuropsychology thing. And so you're resetting the neuropathways in your brain when you do all this, that's what a new habit is. And you're setting a whole new set of habits. And again, the extreme, the level of extreme, deepens the rut in the brain. And so it's like, because I went through bankruptcy, lost everything.

Mine is real extreme. I have a real, this, this like freaking Grand Canyon, right? To where there's no chance, I'm ever going to deviate from it. And so you can add to your chances of ever coming back here again, uh, by trying, you know, you're more likely to come back into the mess again, if you gradually get out. Cause it's not, it's not a deep pathway.

It's not a neuropathway. That's deep. It's not a root, deep rut. And so you want to get, this is a rut you do want to get stuck in.

List the debts, smallest to largest. pay minimum payments on everything, but the little one. attack, the little one with every available dollar until it's gone, then attack the next one with every available dollar until it's gone, then attack the next one with every available dollar until it's gone. Smallest to largest, regardless of interest rate, make sure they're all cut up before the sun sets today, or sawed up, whatever has to happen to those puppies.

It's way too easy to put off making a will. And believe me, I've heard every excuse in the book, but not having the time is one excuse. We can kick to the curb right now, because these days, most folks can make a legally binding will on their laptop between loads of laundry. If you're wondering if you can make your will online, or if you need a lawyer, we have a quiz to help you figure that out in less than five minutes. Just go to our website and sign up for it.

Ramseysolutions.

com slash wills quiz. Ramseysolutions.com slash wills quiz.

Jay Barshall, Ramsey Personality, is my co-host. today. Ted is with us in Raleigh,

Thanks for taking my call. Sure. What's up? So, question for you. My wife and I, last year, we bought too much house.

And to change our situation, we've chosen to sell. We're running into some roadblocks. And so, I wanted some guidance. And I'll jump into the numbers with you. Okay.

What are the roadblocks? Yeah. So, bought our house last year, $366,500, put 5% down, which is about 20K, 7% interest rate. Currently, we still owe.

. How do you owe $342,000 when you only borrowed $246,000??

$366,000.

. Oh, $366,000.. Okay. So, you put 20 down, so you got a $346,000.. And now, you owe $342,000..

Okay. Now, I'm catching up. Correct. Good. Okay.

Thank you. Sorry. Yep.

The increase of property taxes and home insurance kind of took this over the edge, as well, as the situation at work was not what I was expecting it to be. So,

in April, we saw a position open up closer to family. So, we decided to take that, but it's a lateral position. So, we are responsible for the move. The workplace is not providing us any kind of support in moving.

To Nevada. Oh, wow. How in the world are you doing that? You don't have that option.

You're stuck in a house right now. Mm-hmm. You're just going to walk away from the house?

It was $350,000 plus 14K in closing costs. So, factoring in fees, we would owe about $30,000 to sell the home.

And just this past weekend, we took the house off the market because my wife hits 38 weeks pregnant this week.

. Yes, I did make the change to the new team.

No, we have only a small.

. About one month, maybe two months.

So how did you think you were going to pay the payment until the house sold?

. I mean, before you have to move.

All right, well, I'm caught up with where you are. I'm aghast at how you got here, but let's see if we can help you from this point forward, okay?

So you're moving to Nevada with a brand new baby and starting your life, and your house is going to sit here until it sells or until you borrow $30,000 successfully to be able to sell the house at the current deal, right? Right. And your current house payment is what?

because you made this move without having the house sold.

In the meantime, while you're in Nevada, I want you working 24-7.

. Every job you can get your hands on, you need to stack up as much cash as you can stack up to keep from getting foreclosed on here, if you can.

You probably don't have the option to take it. And then let's put the house on the market and try to see if we can get more for it sometime in the next few months before you lose it. You're going to lose it about a year from now. And they're going to come after you for the difference and sue you for the difference. If, during that time, you get another lower offer that you can't cover, then you would propose a short sale to the mortgage company.

A short sale is where you're behind on payments and the mortgage company thinks they're about to have to foreclose on it. And if they have to foreclose on it, they're only going to get X out of the house. and you can get them X today. They'll take the X, they'll take the reduction in the mortgage, but in the balance on the mortgage. But they're not going to cut it while you're current.

They don't do short sales with people that are current. So if you're five months behind and you get an offer like this and you don't have the money to cover the difference, you negotiate a short sale. And then, Ted, here's the phrase you remember, without recourse. A short sale without recourse, which means they don't come after you. for the whole, you leave in their mortgage, that you don't pay because of this whole series of unwise decisions you all have made.

Starting with an overpriced purchase and then making a move before you had a house sold. Both really unwise. This is the Ramsey Show.

Our scripture of the day, 2 Corinthians 4.

16,. Therefore, we do not lose heart, though outwardly we are wasting away, yet inwardly we are being renewed day by day. Fred Smith, that would be FedEx, said, Losing is a temporary condition. Quitting is an attitude.

Okay, Jade, I don't know why, because it seems bloody obvious to me, but I'm still feeling the need to go back and say, okay, let's pretend that we could revisit our last caller before he made some of these decisions. You buy a house that you can't afford. Now, lots of people have done that.

Put down $20,000, which, by the way, now we've lost that money. $20,000 is gone. It's gone. Okay. Because we bought a house we couldn't afford and we put ourselves in a crack.

All right. Now, make $71,000.. Mom does not work outside the home, has two kids and one on the way any minute. We have a toxic work environment. Right?

That's what he said.

He didn't call it that. He called it something else, but the current job wasn't what it was supposed to be. Something like that. Okay. Um, so what should you do in that situation?

Well, your wife is about to have a baby.

You are about to have to sell a house and change jobs. Okay. You've got to put this stuff in the right order or you make a bad situation really bad. Yeah. Okay.

So you do not have the luxury of leaving the toxic work environment unless they fire you. You want to create stability. You have to stay there until the baby comes and the house is sold. Absolutely. Period.

Period. And if you can't pay the house payment because it's so tight, you have to work an extra job. Yes. Suck it up, buttercup, and take care of your family, your wife and your baby and your obligations. Not my, it's not working out at work.

Yeah. I'm sorry. That's unacceptable. I mean, unless they are doing something that's going to get you put in jail, not just hurting your little feelings, you need to go to work until the house is sold and the baby comes. Now, if you get the house sold and the baby comes and you want to take a break even job and lose your $20,000 down payment, break even on the house, which was his hope, then move with cash with the U-Haul to Nevada and break even.

Not sure that's the smartest move, but at least then it's somewhat acceptable. But by putting this in the wrong order, he may have bankrupt himself and may have put himself.

They probably can pull that off if they had everything else lined up.

You've got to run. You don't get to run from discomfort into the other frying pan. You have to run. scenarios. You have to say,

Our house will sell and it'll sell for the magic number. In time for me to have a baby and.

But there's a thing.

. It was 115 degrees in Nevada last week. That was the way it felt outside. If you're talking about moving a woman that's eight months pregnant to 115 degree.

And that's instead of foreclosure, deed instead of foreclosure, similar to a short sale. Both of these are due to your credit about what a foreclosure does to your credit, but they don't chase you for the deficit. If you don't pull off one of those two things, and those are up to the bank, up to the mortgage companies, whether you can pull that off, very difficult to negotiate, especially in this current real estate environment. They don't like losing money on mortgages in an escalating price environment. They just don't do it very often.

And so if you can't negotiate a short sale or a deed in lieu, a deed instead of a foreclosure, then you're going to get foreclosed on. And now this $242,000 loan will have been run up with foreclosure fees and 10 months of back payments to about $310,000.. They're going to sell this house for $200,000 and they're going to sue him for $110,000 deficit. So how does he walk that line? That's how dumb this was.

How does he walk the line of,

At what point, because he's got to decide at some point, I'm either going to do that. And if that keeps going on and then I get to the point where I can't make the payments, does that make sense? I don't think he can make the payments day one.

So the only advantage to doing a short sale or a deed in lieu is to avoid the deficit. chase on the foreclosure. It's not to really save your credit. It saves it a little, but not that much. You're still trashed.

Yeah. You're still in a hole. So, folks, the, the point of the rant here and our, our, uh, I don't know what the right word is. Uh, our distress for that family is when you're in a situation that's tough like that, you gotta be tough.

You gotta, you gotta throw your shoulders back and go to work. Even if it's not pleasant, to take care of the pregnant wife and to take care of the mortgage that you can't afford until you get the house. So I don't care if it's pleasant. I don't care if it's toxic. I don't care if your boss is a jerk.

I just don't care. You signed up for a crappy trip and you're get to ride the rollercoaster of a crappy trip. It's not forever. It's for a few months. So you don't bankrupt your family, because this one episode, this four months long right here, may take them a decade to recover from.

It just hurts me. It just hurts my soul. Ouch, ouch, ouch, ouch. That puts the sour of the Ramsey show in the books. We'll be back with you before you know it.

In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

If you're a leader, your personal growth matters for your organization, because whatever you lead can only grow as much as you do. I know from experience, I've been CEO of Ramsey Solutions for over 30 years and now I'm sharing that leadership and business coaching experience with you. on the Entree Leadership Podcast. I'm taking your calls and helping you figure out how to overcome challenges within your organization. One episode could change your business.

Check it out on Apple, Spotify, YouTube, or on the Ramsey Network app.