Building Wealth Is About Building Good Habits and Sticking to Them
01:28:43 Share

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love.

and create actual amazing relationships. Rachel Cruz, number one best-selling author, co-host of the Smart Money Happy Hour on the Ramsey Networks, and my daughter is my co-host today. Open phones at 888-825-5225. That's 888-825-5225. Daniel is in Reno, Nevada. Hi, Daniel. How are you? Doing all right, Dave. Cool. How can we help?

Yeah, I've got some questions. So I know a little bit about your story and about how you were pushed kind of to the point of bankruptcy. And my question is, is it ever financially wise and spiritually wise as a Christian to defile bankruptcy? My wife and I are $35,000 in debt, 18 of which is a car payment.

We've got two kids. We're living on single income, my income of $80,000 a year. And we've been trying to get out of debt since the day we got married three years ago. Okay. I don't hear anything in that math. Nothing in that math says bankrupt. You have $35,000 in debt. You make $80,000 a year. Nothing in that math says bankrupt. And 18 of it being an asset that you can sell.

But the car, our car was valued at $8,000 by who would be negative $10 equity. I have a local Toyota dealership. That would be a wholesale, be a dealership trying to buy it at a price that they can resell it and make money on it. So you would not say you would not wholesale a car you're trying to get rid of. So that car is probably worth 14 or 15 and you owe 18. And so you're four or five, six in the hole, something like that. You're not 10 in the hole. Okay. Um,

So let's go back to your question. Obviously, it is not a salvation issue. You said spiritually. Jesus loves us in spite of all the stupid but ridiculous things we human beings do. Right. And bankruptcy is on the list of things that I have done that I'm not necessarily proud of. It's not something I'd line anybody up to do.

And, you know, so it's in the 10. You ever heard that list of 10 things that puts people in the hospital? Like if you have four of these 10 things in a 12-month period of time, you're probably going to end up hospitalized. It's like divorce, bankruptcy, death of a close loved one, these kinds of things. These trauma-inducing major negative life event things. It's on that list. So it's not something we want to sign up for. So –

All of that to say, I never condemn someone who files or has filed. Obviously, I'm on that list, but I also don't encourage it. And nor will I personally tell you to do it. I will tell you not to do it. Not because of spiritual or moral ethics or something, but simply you're just mathematically not bankrupt. You can work your way through this and we'll help you, okay? Okay.

Mm-hmm. So should we, you know, what would be our next step? How much is your house payment? Try getting out of debt. We rent an apartment, a single bedroom, and it's $1,125. Okay. That'll be changing in about three months. How long has it been since you've eaten out? When did you eat out last? We ate out last Friday. Okay. And so you eat out three times a week? About once a week. We go out every Friday. Okay.

Yeah, about three times a week. Okay. And when did you go on vacation last? Two years ago. Okay. And you're working 40 hours? Working 40 hours a week. Okay. And you said you got three kids or how many?

Two kids. And they're babies, right? Two and three months. Yeah, little babies. So mommy's got her hands full. All right. So here's what I would tell you. I mean, what we would tell you is long before you're bankrupt, you never see the inside of a restaurant again unless you're working there as your side gig.

And certainly we're not planning any vacations, and we're picking up extra jobs. And we're selling so much stuff the kids think they're next, including this car. Yes, sir. Okay. I mean, you're going to get in gear and go to scorched earth and be on a detailed budget. What do you do for a living? Heating and air manager. Okay. All right. So you know how to run a project. Yes, sir.

This is your new project. Yeah, and Daniel, I think honestly for you guys and your state, because you're not a lavish people. I mean, you're not. You're not out of control. You're not spending like nutty stuff. But this is where, this is the nickel and dime metaphor comes so true with so many people as I'm like, you know, asking your wife, and again, not in like a point blank, but like, okay, what does the last target run look like? Okay, when you're, you know,

When you're exhausted, is it, okay, we're just going to go to a play place real quick. And, you know, you spend like life when you make these little decisions, $35, $40 here or there, it just starts to add up. And the lifestyle creep that is so small. And again, it's not extravagant for you guys.

But you turn that notch, like $300, $400 a month easily can just kind of be floating and not realizing it. Because when you guys get on a budget, Daniel, I guarantee you, because it's not true for everyone. A budget works for everyone. But for some people, it is a revolutionizing moment where they say, oh my gosh, that really is. When you go back, Daniel, you and your wife, to your bank account last month, the month before, the month before, and average out some of these lifestyle categories, it's

I think you're going to see where some of that, where that money goes. And again, you're on 80 grand before taxes. So, I mean, it's not like, you know, you're... You're an average household income. Very much so. Yep.

And so I think it is tightening those knobs even more. And then you guys saying debt is not going to be an option. So the credit card goes, not even making an option, selling the car, freeing up, which is probably, you know, a $500 car payment, four to $500 at 18,000. So it's, it's these, these little, these little tweaks, uh,

in this family is going to make a big impact because $400 or $500 a month changes the game in this. The hopelessness that you're conveying, a feeling stuck, the only way to break that clog, the clogged up pipe loose is an explosion. And so we're asking you to take a major explosion in your behavior's

for a short period of time to get this thing broken loose and get it flowing because you feel like there's no way you can do this. And when I hear 80,000 with two babies in a one-bedroom apartment, I hear a guy who can do it.

Okay, that's doable. And you've made absolutely no progress and it's given you, it's taken your hope from you. Proverbs says hope deferred makes the heart sick. But when desire comes, it is the tree of life. And so what we're trying to show you is, is that you will feel like you got a raise when the two of you sit down and do a detailed budget. And when you sign up for the trip and the trip is, we're going to have to sacrifice deeply for,

for a short period of time to get this unclogged. Which also means, Daniel, if I were you guys, and again, and I'm saying this with your wife in mind as a mom with three little ones, and I know this feeling.

But I would pick two, three nights, two or three nights that you're going to work extra. Oh, definitely. And bringing in that extra income. And so again, it's this whole shift of a change. If you keep doing what you've been doing, you're going to keep getting what you've been getting. And I'm afraid that's what's been happening the last three years. Feeling the pain, but not making these big shifts like we're talking about. So I would encourage you to do it. And to hang on the line, Daniel Christian will pick up. And I want to give you guys...

every dollar premium. So you guys together can be sitting down having a budget that helps you. It's the great thing about every dollar. It's on your phone. You and your wife can have the same account. Be communicating about it and start making those changes because you'll feel that margin. We'll add Financial Peace University to that as well. So you guys go through that and start using that every dollar. You'll see it move, dude. It does work. You can do it. You're not bankrupt. You just lost your hope because you got stuck.

Hey you guys, I'm not a fan of the big banks and you probably already know which ones I mean. But I do like credit unions because they're non-profit organizations that focus on their members. And I'm proud to endorse Fairwinds Credit Union because they share the Ramsey mission of helping people get out of debt.

and live generously. In fact, they design products to help keep you from going into debt in the first place. Fairwinds has been in business for over 75 years, and they serve hundreds of thousands of members worldwide.

You can feel secure because your deposits are federally insured by the NCUA up to $250,000. It's easy to join and Fairwinds partners with more than 5,000 credit union locations around the country so you can bank in person wherever you live. But if you prefer the online experience, you can log on to Fairwinds and do anything you could do at a physical location.

So go to fairwinds.org slash Ramsey to learn more. And while you're there, look at the combined checking and savings account bundle. They created just for Ramsey fans to help you take control of your finances. That's fair winds. F a I R W I N D S.org slash Ramsey. Wow. Crazy. So we're just looking at Instagram, the, uh,

President Trump, we were able to do an interview with him last week that dropped today on our YouTube channel and on our podcast. If you haven't watched it, pick it up and give it a look. It's very interesting. It's a different version of him than you get in the stump speech or in the media. It's just me and him sitting and talking. And something about my country fried self calms people like that down sometimes. So it was interesting. It was a fun interview. Fun thing to get to do last week.

We also had reached out, have reached out to Vice President Harris's camp for the same opportunity. And apparently we're in quotes under review. So I mean, who knows what that means? I don't know what that means in that world. I'm just like a guy on the radio. I mean, I don't know what I'm doing. So podcast and YouTube podcast and YouTube. I'm compared. Yeah, we were number one before yesterday. We were number one in the world.

The Apple podcast ranked number one before the Trump stuff came out. Yeah. I mean, we've been we usually bump around the top 10, but usually it's Rogan or one of the murder things or NPR or whatever. That's number one. And we love murders. We usually bump around down there about five and six. Well, Rachel keeps looking at the murder things and running their ratings up. So but the we're still number one today. We're number one today. All right. There we go. Cool. All right.

So thank you guys. That means a whole bunch of you. And can I say this just to interject? The number one, it's not a pat on the backs of like, oh, we're so great. It is that when you search like I do podcasts and like, what's the new murder podcast? You see a podcast maybe you had never heard before. And you're like, oh, that's interesting. What's this number one? The Ramsey show. What is that?

And you get people that start to click on it and start to learn, oh my gosh, the way I've been handling my money is stressing me out. And here's a different way. So like, that's why we want these high ratings. Oh, we don't want them for us. I know, but it made it sound like we're number one in the world. Look at us. Okay. We're amazing. I'm sorry. I wasn't bragging. I just, it's just amazing. It's mind blowing to me. I was in Trump Tower interviewing Donald Trump. That's mind blowing to me. Actually, my little brain, I'm from Antioch freaking Tennessee. Okay. So,

Just telling the people when they share, it helps us. Yeah, it helps us a lot. Because it spreads the word of handling your money well. Yeah. So if you want to watch the interview, it's on our YouTube channel and it's on the podcast. It's on the Ramsey Network. And I just got an email a minute ago that the Trump social media team posted

did a collab is that what you call it with uh our instagram guys so that means they posted it on his and we posted his on us and back and forth he's got i've got like five and a half million and he's probably got 500 million or whatever i don't know but so yeah kind of weird but okay strange day strange day but if you want to if you want to um

So, yeah, we would love to have you watch it. A whole bunch of folk have watched it since it landed this morning. So thank you. Thank you. Thank you for that. And it's good to have knowledge about where people stand on ideas. That's a good thing.

It's why I would like to actually sit down with Vice President Harris. I know, that's what I was going to say. And I do think it would be important, you know, and we have... I would enjoy it. Or anybody, right? Like, I'm like, there is something to learn, I always feel like, even though you probably naturally fall on one side or the other, but understanding, okay, you know... Most people have already decided. The country is literally 50-50. I mean, it is. So it's like, okay. And this show, we are not, it's not a politically driven show. Anybody, regardless of who you vote for, we vote for you.

We believe it needs to be out of debt. Free up your income so you can build wealth. We don't care what your deal is. What religion and nothing. No, no, no, no. We don't rule anybody out. We love people. Because of an election year, it's naturally going to be a topic of conversation. It's important to talk about ideas instead of yelling at each other. And I do think the vice president debate was on too. So I'm like, man, maybe we can get Tim on. I don't know. This idea...

No, I'm not doing the vice president. I don't want to get in the political business. That's not what I want to do. I'm sorry. You just had an interview with a local president. With the president. Not the vice president, just the president. So, yeah. Anyway, we appreciate y'all. We'll help all of you. If you want to be pissed off and go away because I did it, then just be pissed off. That's part of your life. That's your problem, not mine. So, anyway. Open phones at 888-825-5225. Jill is with us in Pittsburgh. Hi, Jill. How are you?

I'm fine. How are you? Better than I deserve. How can I help? My husband and I are completely debt-free. We built a house about 11 years ago. We had a little bit of a windfall, paid off all of our debt, built a new house, paid that off completely, purchased a rental property, which we rent, and we have fairly new cars they're completely paid for. Okay.

And I have a little bit of money in the bank. And I'm trying to figure out what is the best choice for that money. The only debt you have is the rental? No, it's completely paid for. Like, we are debt free completely. You don't have any debt anywhere? No, nothing.

How much is the money you have saved, Jill? Probably about $300,000, not counting like six months' worth of... Well done, Jill. ...if we had to carry utilities, if we had to carry, you know, provide the rental in our home. Yeah, we'll pull six months out, and that's your emergency fund. But not counting that, you got a couple hundred grand. Way to go. Wow. That's great. You're killing it. How old are you? I'm 52. Okay. Okay.

What's your household income? How much are you working? Are you married? Yeah, we're married. We have one child still at home, one in college, though. And my life has always been about my kids. That is my purpose. I went to college and all that kind of stuff, and I do have a job, but I want to be able to. What do you want to do with this money? Yeah.

That's what I'm asking. I lost my dad a while back, and he was my guy. Very practical. So do we invest in something we know, as in like another rental, and pay it off in full? Or do we just put it into like a mutual fund or something like that? But I am so conservative. Like, because we were...

lucky, blessed, worked hard, put ourselves in the right position, but I'm really not a risk taker. I kind of depend on me and my husband more than I do anything else. So I kind of like that control that our fate is in our hands. But I just don't, I guess I just wanted your opinion on do we do a rental? I invest in two things. I invest in real estate that I pay cash for that creates an income.

And I put money in mutual funds. Those are the two things I do. And I'm not a risk taker. I've been broke. I don't like it. Well, what would you suggest? Doing another rightful? I invest in two things. Mutual funds and paid for real estate. I'm comfortable with both. I'm listening to you and you love real estate. Because it gives you a sense of control that you don't feel like you have in a mutual fund.

Yeah. Right? Yeah, probably. So buy a $250,000 rental. And you think that's okay, even if that puts our nest egg, our easy access nest egg...

You don't need more than three to six months of expenses and liquidity sitting around. And Jill, how much are you guys making a year? About $90,000. Okay, okay. Y'all have done a great job. Yeah, and is there anything you guys want to do? I mean, with the $300,000, you could put in another rental, but you guys have, I mean, do you have any money saved for retirement? Is there any other savings, or is this all in real estate? We do have probably, I have like $100,000 in a Roth.

another $100,000 in traditional, and then my husband has about $300,000 in 401K. Good. That's great. You're millionaires, and you're going to be multi-multi-millionaires when this story is over, no matter what you do with this $300,000. But I don't want it just sitting there in a high-yield savings account.

I don't think that's wise. I think you need to put it in something and put it to work. Some of it. Some of it needs to be your emergency fund. If you want to set aside $50,000 to $100,000 and call that your emergency fund, fine. But you don't need more than that. And go buy you a $250,000 rental house and pay cash for it. Yeah. And enjoy some of it too, Jill. You know what I mean? I'm listening to you and there is a part of me that I'm, you know, I don't know if there's like a dream trip you guys want to take. You guys are doing great and you're making good money.

You have a lot saved, a lot in all this real estate. You have no debt. So, I don't know. I mean, enjoy. We always say give, save, and spend all three buckets. And take some of this and do a little bit of all three. Yeah. Give, save, spend. It's all you can do with money. One of those three. And we recommend doing all three all the time. This is The Ramsey Show.

Thank you for joining us, America. Rachel Cruz, Ramsey Personality, number one bestselling author. My daughter is my co-host today. Caitlin's in Washington, D.C. Hi, Caitlin. How are you? Hi, Dave. Hi, Rachel. How are you guys doing? Better than we deserve. What's up in your world? So my husband is active duty Air Force. He's been in 17 years, and we're in the last.

hall here before he retires. And we were a bit late to the game with investing and all of that. And he has about $50,000 in his 401 or his Roth. And we are in Baby Step 3 now. We paused that and got through our Baby Steps and we're going to be done with Baby Step 3 in February. My question is... How old are you? Thank you. The question...

I'm 37, he's 44. Thanks for your service, by the way. Okay, and your question's what? Oh, thank you. The question is, should we stay, in order, we're trying to come up with, can we hit 100K in his Roth before he retires? Hit that magic number. And in order to do that... Where's that coming from?

You know, I'm not sure if I heard it off of your guys' show or just a financial conversation is that you can get $100,000 into a retirement fund because it'll just have to run. You won't be able to give any more into it. That that'll set as a best for it to grow the fastest for the next, you know, 20 years or so before retirement. Is that wrong? Do you work outside the home?

Not anymore. We have two kids. I am right now in a stay-at-home model with a two-year-old. So when he retires with his 20-year chip, he's going to get the 20-year wonderful military retirement, and he will have some 50 to 100K somewhere in there in a TSP Roth, the thrift savings plan that the military offers. He can roll that to an individual Roth to be managed by you guys with your SmartVestor Pro at that time. But that's not the end of the story, right?

He's not going to be but 30-something years old. I mean, so what's he going to do? What's the next chapter of his life going to be?

Well, he's 44 right now, so he'll be 47 when he leaves. Yeah, so he's just a pup. He's just a child. So what else is he going to do after that? We're going to use the GI Bill. He wants to go back to school to be a physical therapist. Okay, so he's going to go be a PT, and I'm going to pay for it as a taxpayer, and I'm honored to get to do that. It's one of the few things my tax dollars go to that make me proud.

So, thank you again. And yeah, go be the world's best PT and make $100 a year and load your 401k doing that. And by the way, as long as you have an earned income while he's in school, if he goes and does something, and that's not military retirement, you have to have an earned income, you can do two Roth IRAs every year, yours and his.

Individual Roths. So you're saying we should roll his military Roth over into an individual. I didn't even think about that. Yeah, and that helps you to manage it better because the TSP has decent plans. The C plan is okay. The S and the I are sort of okay, and that's what we tell people to put in most of it in the C because it's basically an S&P index is what it is.

So it's going to do pretty well, but you can do better with a smart investor pro picking mutual funds that are outperform that once he's out. You can't do it till he's out. But then you guys just continue to do individual Roths. And in his next chapter, you're going to continue to save. You're going to be fine if you don't make it to 100K is my point. You haven't missed the boat on being millionaires.

Yeah, yeah. I think that's my big thing is the money that we would have to put in in order to hit the $100K would literally keep us gazelle intense for the next four years. No, no. When you get to Baby Step 4, you need to be intentional, not intense. Intentional can include a level of intensity, but it doesn't mean we don't go on vacation, we don't go out to eat, and we don't have a new couch with a spring sticking through.

And we don't save for the second car that we desperately need. There we go. See, you need to start having a life. That $100K is not that magical. Yeah, and it's interesting, Caitlin. And actually, Dave, I would be interested in your thoughts on this. Because there is a lot in the social media realm with people giving financial advice, or even podcast, YouTube, all that, where they're like, oh, hit millionaire status by this age. Oh, hit $100K in your Roth. I mean, there's these...

So it's a TikTok thing. Well, not necessarily, but that is a piece of, that's a way people talk about being intentional is have a number out there, a dollar amount. And what's interesting, Caitlin, or at least for me, that's why I want to get your thoughts on this, Dave, but there's a point where that number can become almost this idol thinking, if we just hit this, my life, everything's going to be okay. And if we don't hit it, we're not going to be okay.

Yeah. And it's and it's a little bit arbitrary. That's why I love the phrase financial peace. Right. Like we talk about financial peace because peace can mean all different things, all different numbers for different people. Right. Just because you hit a million dollars doesn't mean you necessarily have peace if depending on who you are as a person. Right. And if anything, you're like scratching to get more. Oh, I don't feel fulfilled now. So now that finish line moves and moves and moves. So there's something more holistic about.

That's good. That I want you guys to talk about as a family and not just a number because those numbers, they feel empty to me. Like I get like be goal oriented and like shoot for a goal, but have a goal that has like you guys in it, like the character and who you are, what you want for your family. I think there's something there that

That's more fulfilling. And again, peace may be to make sure that we can retire and enjoy life. But there's just something. People do that a lot. And I don't know. Not that it's wrong. It just feels empty to me. If it's artificial to the point that it drives you, your point, that takes away the couch and the second car. Yeah. Because you're still going to get there. We don't want you to retire broke. We're not teaching that either. Here's the point. If you save 15% of his income, what's he make? $80,000.

Okay. So, you know, let's call it 100K for round numbers, 15K a year for three years. That's 45. That's with no growth. Yeah. So you're there. We're about there. You got 50 now plus 40 something. Yeah. I mean, you're not that far off and you're going to get some growth. That C plan probably went up 20% in the last 12 months.

That's fair. Yeah, the numbers have been – it has been looking nice. Yeah, it's done good. I mean, the S&P, the stock market's done good. And I see what you mean about the piece thing versus numbers because I will say getting on that budget and staying on the every dollar budget, that thing – But here's the thing. If you run 15% out right now – Yes, I'm blacking out.

then everybody's winning in this. And by the way, go ahead and extrapolate out with a couple years off for PT school and then kick back in at 80 to 90 to 100K for the remaining working years of his life, the next, what, 20 some odd years or so as a PT, and put 15% of that income away into retirement, meanwhile paying off your house, and you're going to be worth about $8 or $10 million when you get to 67%.

Sweet. I'll hold you to that. I'll give you a call back. Yeah. Well, if you do what I tell you to do, it'll work. I mean, I got millionaires all over America. They're called Baby Steps Millionaires. They're all over the place because they follow this stuff. And it's not because I'm magic. It's because compound interest is magic.

It's called just steadily investing is the key, and it's not 100. Now, the fun thing, Rachel, about – I didn't know this social media trend because, as you know, I don't do social media. But I mean, I think I've heard some of our personnel, you know, even be like, yeah, try to – or not try to hit a million, but like – What I like about that is that math is easy. So here's the thing. I don't like the artificial pressure it puts on you that's weird, which is what she was struggling with. But what I do like is this.

If you are investing and you're averaging stock market rates of return, you're going to average more than 12%. So let's dumb that down to 10%. If you're making 10% on your money, here's some easy math for you. A lump sum will double every seven years.

So if you're 35 and you have $100,000, no, he's getting ready to be 40 something. Okay. So he's 45 and he gets $100,000 or whatever the number is. Okay. Then you can say that. Then you could say, okay, then.

Seven years later, that's going to be $200. At 52, yeah. And at 52 and at 59, that's going to be $400. And at 66, that's going to be $800. Without adding anything. And that's with adding nothing to it. Yeah, yeah. And so we're going to have $1.6 million in our 70s with adding nothing to it. So I kind of like that goal. That's a good reason to reach for $100.

Because I wanted to turn into that. Yeah, yeah, yeah. But I think our 15% rule will get you there faster. Yes, yes. And not break the bank. Yeah, and there's a 15% rule that I like that it's a habit, and that's so much about winning with money. It's just how you view it and how you use it, and that 15% is a habit versus like, I'm going for the specific number because I think we can get so...

I don't know, infatuated with like, oh, if I just hit this number by 35, you know, everything, it's all great. It's all great. And then you're like, well, you get there and like, have you really created a life that you love? Like there's just life is more holistic than a number. If I don't hit my weight loss goal by a certain date, my fitness plan is a failure. No, it's not. Right. You still lost weight and you still change your habits, which is more important than hitting that weight loss goal by a certain date. That's your point. Amen. Brother Dave. There we go. Sister Rachel. This is the Ramsey show.

This show is sponsored by BetterHelp. This is the season for Halloween. It's October, we're wearing costumes and we're wearing masks. So if you haven't started planning your costume yet, get on it. And while you're thinking about it, I want you to be honest. A lot of us hide ourselves. We hide our true selves behind costumes and masks all the time. We do this at work, we do this around our friends, we do this around our families.

We even do this when we look at ourselves in the mirror. I know because I've been there multiple times in my life and it's the worst. If you feel like you're stuck hiding behind masks and costumes all the time, if you find yourself hiding from your true self, I want you to consider talking with a therapist. Therapy is a place where you can be honest, where you can talk to somebody else and reflect and learn and you can accept all the parts of yourself over time and start living an authentic life.

Masks and costumes should be for Halloween parties, not for our emotions and our true selves. And if you're considering therapy, try calling my friends at BetterHelp. BetterHelp is 100% online therapy. You can talk with your therapist anywhere so it's convenient for you and your schedule.

Just fill out a short online survey and you'll be matched with a licensed therapist. Plus, you can switch therapist at any time for no additional cost. Take off the costumes and take off the mask with BetterHelp. Visit BetterHelp.com slash Deloney to get 10% off your first month. That's BetterHelp.com slash Deloney.

The Ramsey Show question of the day is brought to you by YREFI. Student loan debt is a swamp that thousands of people find themselves hard to escape from. Don't be another statistic in the student loan swamp. For distressed...

private student loans, there's YRefi. We trust YRefi because they help you with a low fixed interest rate that you couldn't get anywhere else. They'll get you out of a defaulted private student loan mess, and nobody else does this. This is why we endorse them. It's the letter Y, R-E-F-Y dot com slash Ramsey. Might not be in all states.

All right, today's question comes from Dennis in New Hampshire. My adult son was laid off from his tech job and now works retail while job hunting. We invited him to live with us rent-free until he gets back on his feet. My wife and I enjoy his company, but how do we get him to realize the value of what we're providing? I've asked him to do a couple of simple tasks to help us out, and his response is that he's too tired.

I can do tasks myself with a lot less aggravation, but the real value is in learning to help out and the responsibility of home ownership. How can he not see the value of doing simple tasks in exchange for what he is receiving? Oh, no. Because he doesn't have to. It's too late. Because he doesn't have to. He's grown. You don't get to be his daddy anymore.

All you can do is let him get out in the wild and he'll figure it out. It's too late. You can't retrain a 33 year old honey.

Okay, the key there is that you can't retrain him, but he can learn. I know, but how can you? He's treating him like he's talking. This sounds like the guy thinks he's 16 years old. Well, and I don't know. How do I teach my child a work ethic? He's not a child. Yeah, I don't know if adults. He's a lazy adult. His son is 23 or 33. I don't know how old he is, but. Well, he says he's an adult, so I don't know. Yeah, yeah. That's where I'm going.

Yeah, so my philosophy always with going back and living with parents is if for a season... You can't. That's your philosophy. Mine? We wouldn't let you. Oh, y'all. No, y'all let Denise move back for six months after college graduation. Yeah, just for a minute. That's what I'm saying is that there are seasons. Gosh, so argumentative today. There are seasons that I think, you know, like if something happens, right, a job, I don't know, there's times that I'm like, yeah, if you need help or...

I don't know. I'm okay with it for a period of time, like a period of time, right? Four months, three months. Like, I don't know if you need something for a period of time. I'm sorry. I didn't think that was the question. It's not, but I'm just saying when it is okay to move back home. If someone is hurting and they're grateful and they're going through a horrible divorce or they lost a job temporarily to move back home as a safety net, not a freaking hammock, I'm good with that.

but a yes eagle that does not leave the nest is eventually known as a turkey so fly baby fly so if you want to move back home part of that means gratitude and you freaking get off your little butt and do something because your dad asked you to do it because you're living there rent free it's kind of an obvious thing that's this guy that's dennis's point and

But my problem is, Dennis, is the language and the sentence structure that you're using to address this. You are acting like you're dealing with a child, and yet you started the email with that you're dealing with an adult. So I negotiate with adults differently than I negotiate with children. Children that are under my supervision do what I say because it's for their best interest.

For a lot of reasons, because I love them and I want them to win and I'm going to teach them how to be great adults. They do what I say. The inmates are not in charge of the asylum. We're not confused. We don't have anarchy. We're dinosaurs. We're old fashioned people.

Now, but this is not, I don't get to do that with Rachel anymore. As you guys can see on the air here, she's 34. She does what she has her own independent thoughts and does whatever she wants. And so I don't get to tell her what to do anymore. At best, I can try to influence her at best. And that's all you can do with him. And so what I would do is sit down and say, honey, you're living here free.

And the way I understand that is, is that you're going to do some things around here to say thank you for that. And if you're unable to do those things because of your fatigue, then you're going to have to make plans to live somewhere else because I'm not buying your fatigue. I think you're a lazy little. Yeah. That and having a move out date. Yes. Anyway, regardless of how great he is, there needs to be, because he needs to go out and enjoy his company. Okay. That's nice. I mean,

We enjoyed Denise's company. She was easy when she moved back in for that 20 minutes after college there for between trying to get an apartment, trying to get a roommate set up and all that stuff. Denise is easy. We didn't, we didn't have her move out because then, cause we didn't get along with Denise. That wasn't it at all. But, but, but we had to move out because it's good for Denise to like be a grownup and stuff. When you buy your own milk, uh,

And you look in the refrigerator to see if your own milk that you paid for has hit the expire date. That's a different whole process emotionally and developmentally than drinking your mama's milk. I mean, come on. Seriously. So it changes everything. It stunts your growth. So I don't care if you enjoy his company. I'm glad you enjoy his company. That means you all can have a great conversation about when he's going to move out and the fact that he's going to do some work in the meantime while he's there.

So end date, and we're going to respect the values under which I live. I have been known to have a glass of wine. I have a relative that is really upset about anyone drinking wine. I would never take a bottle of wine to his home if I was staying there overnight as I was traveling. That would be rude. It's his home.

not mine. I don't get to bring my values and impose them under his roof. I abide by his because that's his house. And as his house, that's the way they set the rule. I'm good with that. That does not offend me in the least. So perfectly fine. Not waltzing into that guy's house and doing something that is. And that's what this young man's doing.

And because it happens to be his parents, it seemed like it's okay in his little head, but it's not. That's the same thing. When you're in someone else's home, that's their place. They set the rules. They say it's their values that run the thing, even if they're not aligned with yours. Exactly. And, um, so there we go. And, um,

Yeah, you'll be okay if you do some work while you're tired. You won't die from working. Right before you die from hard work, you pass out. So it's okay. You're not going to die. You'll be okay. It's going to work out. Ash is with us in Chicago. Hi, Ash. Welcome to the Ramsey Show. Good afternoon, sir. How are you? Better than I deserve. What's up? I'm 31, single, and I'm currently on Ramsey's Baby Step No. 3. Cool. Hello. Did we lose you?

I think we lost him. It looks like it. Press five. Try again. Something happened. Hello, Ash. Are you there? Something happened. Well, he's doing so good so far. There he is. Ash. Wait a minute. Hello. You there? Oh, we got you. Sorry about that. Okay. You're on baby step three. We are so excited for you. Well done. Yeah. Thank you. And zero debt. And I've got 45,000 saved in my savings account just sitting in there.

And I was thinking to buy an apartment, you know, invest in real estate. I'm so new. I just wanted to know where do I start, how do I start, and so on. If you're going to live in it, sure. Okay. What about buying and renting it out to college students and stuff? Not until you have a place to live. I don't want you being a landlord while you're a tenant. Okay. Okay. Your number one purchase in real estate is primary residence first. Get that paid off and then start being an investor. Okay.

Okay. Understood, sir. Yeah. You're doing a really good job, though. I mean, you're moving along. You're thinking right. Get your home paid for and then start investing in real estate with paying cash for it. You're going to be in great shape. Yeah.

The investing in real estate has come up a couple times already in this hour, and it still continues to be a place that people are interested in. Yeah, I'm very interested. But the philosophy for Ramsey is the paid-for cash model, which means you will start smaller. Yeah. You'll start cheaper, all of that. But for those of you that are thinking about it, that's it. The data tells us that people that build wealth slowly keep it.

The people that borrow into and create wealth with a pile of debt lose it. And I actually have lived that too. So I'm actually walking proof that that crap doesn't work. This is The Ramsey Show.

Do you ever feel like you're finally making progress towards your goals only to get quickly distracted by something else in your feed? Well, that's why we created the Ramsey Network app, your single source for content that keeps you motivated. The Ramsey Network app is designed to keep you laser focused on reaching your goals. Loaded with over 700

thousand hours of Ramsey shows, this free app is the best place for uninterrupted content and no distractions. Plus, you can search specific questions to get more personalized content in seconds.

So for the days you need some extra motivation, you'll have proven advice at your fingertips. It's time to get serious about your goals and shut out the distractions for good. Simply search Ramsey Network in the App Store or Google Play. If you're listening on a podcast, just click the link in the show notes to download our free Ramsey Network app today. Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people.

Build wealth. Do work.

that they love and create actual amazing relationships. Rachel Cruz, Ramsey personality, number one best-selling author, co-host of the Smart Money Happy Hour show on the Ramsey Networks, and my daughter is my co-host today. Open phones at 888-825-5225. The call is free, and some say the advice is worth exactly what you pay for it. Denise is with us in Cleveland, Ohio. Hi, Denise. Welcome to the Ramsey Show.

Hello. Hi. I just have a question for you. I'm about $850,000 in debt. And my question is, should I file for a Chapter 13 or should I just pay you what I can with the income that I have and

I'm using like a snowball effect. I'm not sure. I won't have enough pretty soon here to cover all the loans and credit card bills, but I can pay what I can. But I'm just trying to get your opinion on... Sounds pretty dead-gum scary, kiddo. Yes. How much of the $800,000 is a mortgage? I have a mortgage and a second mortgage, so it's about $490,000 between those two. And what's that house worth?

It's about $550,000. Okay. And so $490,000 out of $800,000. So you've got about $300,000 and some change in non-mortgage debt. Correct. On what? On two cars. Okay. Give me car number one. What do you owe on it? Car number one is $61,000. $61,000. Car number two is what? $8,000.

$46,000. Okay. And so that's $100,000 and some change of the $300,000 and change. What's the rest of it? The rest of it is I have about five credit cards at $40,000. Each or total? Total. Okay. Total for the five credit cards. Credit cards at $40,000 and what else? And the rest is unsecured loans and line of credit. No student loans? No.

No student loans. Okay, so you have $200,000 in unsecured loans and line of credit? Correct. Okay, and what is your income? I suppose about $13,000 a month. Doing what? Well, I have, I'm a, I'm trying to stay anonymous, but I'm a tester. I'm a tester, a software tester, and I'm retired military, so I have that income as well.

Actually, okay. Are you married, Denise? Yes. Okay. Does your husband work? He works, but it's trucking, so sometimes the income is down when there's like hiccups with the vehicle, so it's not consistent. Okay, on average, what would he bring home a month?

Um, like just the, it's just, um, this past couple of months, I would, the truck's been down to, I'd say maybe 2000. He owns a truck? He doesn't own it. There's a loan on it. No, I'm saying, is that one of those 61 or 46, the truck he drives? No. So he has a rig that in addition to what you're, the debt you're giving me, he has debt on the rig.

Correct. Okay. And how much debt does he have on this rig? $50,000. All right. And what did he make last year, net profit, taxable? About $50,000. He can make more than that driving for somebody else without carrying debt on a broken rig. A lot more. Yeah. Yeah. Okay. So here's the thing. Your voice...

Sounds like someone who's had the crud beat out of them, and looking at these numbers, I see why. You feel beat down, am I wrong? You're right. Okay, and it's scary, isn't it? Yes. Okay, that's the bad news. The good news is that we can get you completely out of this mess pretty quick, but you're not going to like it. You ready? I'm listening, yes. Are you ready? Yes. Buckle in.

sell his rig sell both your cars sell your house wow i just got rid of almost all the debt you know how much money i just freed up a month to throw at the remaining debt and you'll be done in 24 months you'll start again and this time you're not going to buy a bunch of crap with money you don't have to impress people you don't really like a 61 000 car is

And you want to file Chapter 13 bankruptcy? No, you sell the stupid freaking car. Set yourself free. You walked up and put yourself in shackles, and I am handing you the key. Step back out of them. Sell everything in sight.

Tell your husband to go get a job driving over the road, making 120 with his CDL. He gets to come home on Fridays because he gets to work his butt off to help you clean up this mess. You guys are going to live on beans and rice, rice and beans. You're not going to see the inside of a restaurant unless you're working there. You're not going on vacation. And in two years, you'll be a 100% debt-free, and you'll be making $250,000 a year and can rebuild your life. Mm-hmm.

That's got to smell good. Yeah. Because you've got stink in your nose right now. Yeah. The only question is, are you willing to turn loose all that crap for the freedom? You ever seen that thing they use in the jungle to catch a monkey? You ever seen that trick? Yeah. Where they put jelly beans in a bottle and the monkey sticks his hand in the bottle, a big, huge bottle that's weighted, and he won't let go of the jelly beans in order to get his hand back out of the bottle. Yeah.

And because he refuses to let go, he stays in the trap. Hello? You getting this? I'm getting it. Let go of the jelly beans. Get out of the trap. I've been where you are. It ain't no fun. That's how I can hear it in your voice. I remember being so scared I couldn't breathe. I remember my wife looking at me with terror in her eyes. It is not fun. And none of that crap you own is worth it.

We'll help you if you want to do this. But I think the bad news is you got a mess. The great news is you got a way out. If you let go of the jelly beans, you can be free, hon.

I mean, yeah, even the quick math, you sell everything, you'll gain about $60,000, pay off all the credit cards. And about $3,000, $4,000 a month in payments that you don't have anymore. And then you'll have $170,000 and all that unsecured debt. And you guys just pay it off in two years by working like crazy. Easy. It's worth the piece, Denise. It's worth the piece. I'm going to put you on hold if you'll do it.

We'll furnish you a personal coach as at our expense if you'll do it. If you won't, I won't furnish them.

Okay, here's the hard truth. Your investment dollars could be winding up in the pockets of companies that hold positions you don't agree with. People are unknowingly putting money into tech giants and household brands that don't match up with their core values. But here's good news. Timothy Plan is at the forefront of biblically responsible investing. That means Timothy Plan uses a strategy that lets investors chase competitive returns

while staying rock solid in their beliefs. So if you're ready to invest with a clean conscience, it's time to check out Timothy Plan. Request information at timothyplan.com to learn more or contact your financial advisor today to see if Timothy Plan is right for you. timothyplan.com Investing includes risk, including possible loss of principal.

Before investing, carefully consider a fund's investment objective, risk, charges, and expenses contained in the prospectus or summary prospectus available at timothyplan.com. Read carefully before investing, mutual funds distributed by Timothy Partners LTD and ETFs distributed by Forsyth Fund Services LLC. Hey folks, Dave here. If you haven't booked your cabin on the Live Like No One Else cruise, now's the time because it's 90-something percent sold out. You do not want to miss joining me, the Ramsey personalities, and

and amazing guest entertainers for the ultimate debt-free celebration. We'll be sailing the Caribbean March 22nd through the 29th, 2025, stopping at the incredible Turks and Caicos, Puerto Rico, St. Thomas, and the Bahamas. Hurry to secure your spot with a $600 deposit today at ramseysolutions.com slash cruise.

Rachel Cruz, Ramsey Personality, is my co-host today. Thank you for joining us, America. If you want to win at something, winning is a series of intentional acts. If you want to be married successfully, it's a series of intentional acts, habits, and behaviors. If you want to be fit, it's a series of acts and behaviors and attitudes. Building wealth is the same way.

You don't accidentally become wealthy. Oops! No, it said no millionaire ever, right? So the best way to make the most of your money is by creating and sticking to a monthly budget. Every dollar makes it simple to plan spending and track expenses and save what matters most to you. Keep a pulse on your spending and make progress on your money goals with every dollar.

It is updated and iterated all the time. It is the world's best budgeting app. Tens of millions of people use it every day. That's not an exaggeration. That's an actual statistical fact. And you can, too, go to every dollar in the App Store or Google Play, download it, and start today with using it with your spouse for those of you that are married. And, Rachel, I...

You do a lot of stuff on the every dollar side of the equation, helping people, doing the webinars and teaching them to do that stuff. What we have found all the way back in 30 years of us doing this at Ramsey, teaching people how to handle money, win with money and so forth, is the common denominator among people that win with money is they budget, especially married couples who budget together.

Yeah, I mean, it's it is the I think it's one of the top reasons it's hard to win with money is when a spouse is not on board because you're trying to do the plan. And if they're not on board doing it with you, it can be nearly impossible. I mean, it's really, really tough. And so getting yourself in a position and your spouse is.

on the same page, seeing yourself as a team and every dollar from a, from a tactical standpoint is so helpful. Winston and I, you know, we do it and we both have the same account. You just share the account login info and he has app, the app on his phone. I have the app on mine. And I mean, we're text about stuff and it's like, oh yeah, we had to do something to the minivan. And it was like, okay, put a line item in the every dollar, you know, the every dollar, uh,

app and change it here we'll go i mean you just end up talking about life too right i mean money and life are just so overlapped and when you and your spouse are together doing that life just runs a little bit more smoothly melissa's in pittsburgh hey melissa welcome to the ramsey show hi mr ramsey it's an absolute honor to speak with you guys today you too how can we help

So, my husband and I, I mean, I've heard of Ramsey and everything, but we really delved in back in January, and it took us about nine months to get through baby step one, which sounds ridiculous, but I've done everything on the Dave's Do Not Do list in my entire life. And the biggest thing that set us back was a home renovation that we were living in.

And, um, definitely was, you know, over budget and over the timeframe. Um, not that we ever thought that we were the exception, but, um, just naive about it. But my question is we're dink wads. Um,

And I have three dogs and a cat. And I have been a veterinary technician for 13 years and mainly in emergency medicine. And I always focus, not focus, I always explain my mentality with them as like a new mama, as an RN in a children's emergency center. And every little thing about them, I panic. So when I...

Became a dog mom and a cat mom. I thought I was doing the responsible thing by getting pet insurance. And I know I've read, I've read things about like pet insurance and I know you love dogs and everything, but I can't get myself to cancel the policy. And I don't know why it's like my head knows the numbers. I know. Right.

But my heart is fearful. Melissa, I don't think pet insurance is your problem. In nine months, you couldn't get $1,000? What in the flip else is going on? Because of the home renovation stuff. Is that over? Well, we're still living in it. It's still going, but it's not. What is your household income?

Our household income is, our gross is like $125. I just did the number the other day. Okay. Net, we're about $105. Pet insurance is not your problem. Well, it's... How much are you paying a month? Like $350. Okay. So it's not that it's my problem. I know that it's not like the problem, I guess. But it's an expense you're wanting to cut to free up money. Right, right. It's part of the budget that...

I'm seeing that's going out. Let's just pretend that I talk you into canceling the pet insurance, which you should do. Okay. Make $120,000 a year. If your pet needs some help, you can take care of your pet. I guess. I don't know. Because you can't seem to find $1,000 making $125,000 a year. So I don't know if you can take care of your pet or not. This is my problem. You should be able to with no question at all.

Right. If we repurpose some of this money to save the life of your dog, you can find the money to save the life of your dog. Right. If something happened. Agreed? You make $10,000 a month before taxes. Right. I think we could figure out a way to save a dog. Yeah. But you can't find a way to get $1,000, so that's bothersome. Do you follow me? Yeah, and we side hustled and stuff, but it was like every time we... No, you've got to spend like you're in Congress.

Well, not anymore. Yeah, you do. We did. Well, not since I got the EveryDollar app. Yeah, they're trying. When did you get the EveryDollar app? Nine months ago? No, no, no, no, no. About a month ago. Oh, okay. I was on a webinar with Rachel. Okay. Maybe a month ago. Now it's all going to be okay. See? Yeah. Giving hope. And I'm changing lives.

And I know it's going to be, and I've been, I've been actually writing everything out. Good. Yes. On paper. So like the, every dollar has definitely been life changing and having it digital and linked to the bank account. Is your husband working with you on this? He, so, but no, he is. I promise he is. So you guys had mentioned about being on the same page. I always say my husband's in the same book.

It's a good metaphor. He acknowledges there's a problem. But he's not, he's not like very proactive in helping you figure it out. Okay. He's not looking at the numbers is the only thing he's not doing. He's not sitting down and looking at the numbers. That's the only thing he's not doing. Have you asked him to? I have. And what's he say? Um,

He just kind of makes it work to not do it. Okay, so here's what I would do, Melissa. That is 98% of what's going on here. 2% is pet insurance. Yeah, okay. I guess the reason why my question with the pet insurance was is I know where I can put that money every month. Right, you're seeing an expense that could be freed up, and you're like, okay, yeah, I hear you. It's a no-brainer. Self-insure through your pets. I'm with you.

You're not killing your dog when you cancel the insurance. You're making a decision to write the check to keep from losing your dog. And it's a good, it's a, you know. You're self-insuring through pets, which everyone should do, by the way. Right. No, and I, after, you know, after. Especially people that make $125,000 a year.

Yeah, especially listening to you. Like, I know the life that I'm going to have because of you. So, like, and we're working on that. But I just don't want you to do this thing that in an area of your life, these animals are precious to you. They're particularly precious to you because of what you've chosen to do with your life as a vet tech. And so you're beyond animal lover.

I'm an animal lover, but you're beyond animal lover. So this is like the center core of who you are. And we're reaching over there and hitting cancel. Yeah. I don't want you to do that and not do all this other stuff that is really the problem. Yeah. Right. No. And I just. Right. Yeah. I don't want to ask you to do something that means that much to you when it doesn't fix everything. Yeah. I guess it just.

Was a baby step towards what we're working on. It's something you can do that you can control without having to get him on board. Right. Yeah. And that's right. So the bigger picture, you're doing some tactical things that are really good, but high level, Melissa, I would, I would say tonight and just tell him this would mean a lot to me. I'm feeling overwhelmed. I'm, you know, you list out what is going on within you.

Tell him that. And if he doesn't listen and say, okay, I'll show up for 30 minutes and look at numbers. He's kind of a crappy husband. And then you have a marriage problem at that point, right? So like there's could be some stuff that's the string is being pulled. And I would, I would continue on because I think you can have a healthier, more beautiful life if you do. So push on Melissa or cheering for you. Yep. This was the Ramsey show.

Motivating your team to work and lead with the same passion you have is one of the toughest things in leadership, but it's crucial if you want to scale your business. Fortunately, Entree Leadership Summit is the leadership event that will equip you to build a team that fights shoulder-to-shoulder with you so you can grow like never before. Join us in Denver, Colorado May 18th through the 21st by going to ramsaysolutions.com slash summit or click the link

In the show notes, Rachel Cruz, Ramsey Personalities, my co-host today in the lobby of Ramsey Solutions on the debt-free stage. Tyler and Alyssa are with us. Hey, guys, how are you? Good. How are you? Fantastic. How are you, Dave? Good to have you guys. We're better than we deserve. Where do you all live?

So we are from DeMott, Indiana, which is about an hour south of Chicago. Fun. Well, welcome to Nashville. Thank you. And how much debt have you two paid off? We have paid off $96,000. Wow. How long did that take? About three and a half years. Good for you. And your range of income? So when we started, we were making around $97,000 a year, and that bumped down to $80,000. Okay, cool. What do you all do for a living?

So I am currently the youth pastor, student ministry director at my church. And I am mostly a stay-at-home mom, but I do work part-time as a social work program manager. Okay, so that's the step down. You step down to stay at home and be part-time. Yes, exactly. Very cool. Good for you guys. What kind of debt was the 96? So a little bit of everything. Most of it was student loans, but we had car payments, phones, medical bills.

You kind of normal? Kind of normal. Yeah. How long y'all been married? We've been married for eight, eight, almost nine years. Almost nine years. Okay. All right. And so somewhere around five years into the marriage, somebody looked up and said, something's wrong.

Tell me your story and how did you get plugged in with the Ramsey stuff? So we had heard some of your principles and stuff at our church from our senior pastor, specifically the debt snowball. But I didn't really understand it all. And then I was invited into a small group right around that time a few years ago where we had to read a book.

every month and then discuss it. And one of the books on our list was Your Complete Guide to Money. Oh, wow. And so, which we actually didn't end up reading the book, but I had already bought it because I was really intrigued, especially since I had already heard about some of your principles. So I read the book and...

was like, we got to do something. Like a lot of our, any of our marriage struggles had to deal with finances and lack of communication around it. And we just, we really wanted to be more generous people and to be able to grow our family without having to worry about financial stress. So

I took the information I learned. I tried to share it with Alyssa. She was really, really skeptical. I was a little hesitant at first. So it took some convincing, but I just kept listening to your radio show over and over again. And one day we went out on a date.

And we had a really long wait. So we decided since it was cold that we would just go sit in the car with the heat on. And I'm like, well, let me just put another one of your shows on. And so we listened to it. And something during that show, something started to change within her. And she started to, I think, understand...

that this was possible. And then right after that, we were approached by a beggar who had knocked on her window and had asked for money, I think for a hotel room or food or something. And I opened my wallet and we didn't have anything to give. And then I was just, we were dreaming about what it would be like to have been able to just

give him something in that moment. Or I run with Team World Vision and we just changing lives across the world by providing clean water. And I'm like, what would it be like for me to be able to give a little bit more to this or just all those kinds of things. And so we really want to be more generous. We wanted to be able to grow our family and we were sold.

That's awesome. Okay, so I'm curious. So what was the hesitation at first? Was he like, you can't spend any money? And you're like, who are you? You're crazy. Or what was the hesitation? And what was the thing that kind of turned it for you? Because there's probably people listening that have a spouse or maybe themselves are like, I don't know about this. Yeah, I think I just don't really like change. And even though it wasn't going well, we had been doing this for five years of our marriage a certain way.

And just the fact of doing so many changes, like we had separate bank accounts and everything. So we would have to combine our bank accounts. And I just, I was, I was just nervous. I was like, what if it doesn't work out? You know, and I'm kind of a skeptical person. But I think the biggest thing for me was really, we wanted to grow our family and have more kids. And we didn't want to have to worry about the finance aspect of that. And I think I,

started to think about that more and more. And obviously we've had three kids and one on the way at this point, but I think that was really like my turning point for me. Which is really big for a lot of people. It's the why, right? Like it is this bigger life. Oh my gosh, what do I want my life to be like? And how can I get myself in a position to do that? And that was it. The motivating factor family for you guys, which is huge. That's so great. And the generosity part too. Definitely. Yeah.

Most of us will do things for our kids or even for other people that we wouldn't do for ourselves. And that's weird. But that call to nobility called you to face that change. Yeah. The uncomfortable change. Right. Okay, I'm going to try it for the kids. Yeah.

Yeah. You know, I'm going to try it so I can be generous. Yeah. I'm going to try it, you know, instead of like, I'm going to try it. So for me, you know, people don't do that. That's weird. Right. But good for you. Good for you. Proud of you guys. Very cool. Congratulations. Thank you. Now, and in the midst of having all the babies, so you guys started this three and a half years ago. You still paid off. How old's the oldest? The oldest is seven. And then we have a three and a half year old, a one and a half year old.

So you were nine months pregnant when you decided to start this? Yes. Really close. Yeah. Oh, beautiful. So sweet. Oh my gosh. Okay. What was the hardest part doing this? Cause you guys are a new family doing a lot. Um, for me, it was giving up fast food runs, eating out when I'm tired and taking care of toddlers. And I just want to go through the drive through line. Um,

saying no to family and friends going on vacations even playdates at different like Chuck E. Cheese type places you know it was those were the hardest things for me. And then for me spending money I don't like doing it anyway so it was really most of that was really easy but paying all of this money to debt was really hard and so we knocked out most of our our debts in that first year and then we were just left with the big student loans after that so like we had all this quick wins and it was really awesome and then it

- It's like we hit a wall. - Yeah, it's like we hit a wall and it's like, what do we do from here? So then I was like, well, I need to motivate myself somehow. I looked through our budget, I'm like, haircuts, I don't need haircuts anymore. So I took that out and I'm like, if I just save the money there and grow my hair out to a point where it'll annoy me, maybe it'll motivate me to keep my foot on the gas

You know, that's what I did. So I did. I grew my hair out for two and a half years. And then a couple months ago, I was able to cut off 20 inches. Whoa. Oh, my gosh. Yeah. That's awesome. Wow. That's awesome. Okay, so how does it feel now? Because you were saying before it was not working. We knew it doesn't work. You know, there were some fights in there about money, all of it. And now you're on the other side. Was it worth it? It was so worth it. It's been life-changing for us, honestly. How does it feel now? Oh, my gosh.

Amazing. Yes. Yes. We don't have to worry about the money aspect, even though we don't have a huge income. We have what we need, and that's what's important. And I'll say that...

That we never had to touch our emergency fund. But the day after we make that last payment, like something happened with our car, our freezer went out and like it was somewhat stressful. But I'm like, but we now have the money to just be able to pay for these instead of having to go in debt for those kinds of things, too. And that was that was really cool. So good, you guys. Incredible. Are the kids here? Yeah, bring them up.

What are their names and ages? So we have Indy or Indiana. She's seven. We have Zyla. She's three. And then Shepard, he is one and a half. Oh, my goodness. Oh, here they go. Okay. Oh, so sweet. Look at the cowboy boots. Oh, man. Cute, cute, cute. Beautiful family. And what's number four? That's a great why right there. December 23rd. All right. Christmas baby. Yep. Yep.

All right. Here we go. Fun stuff. Proud of you guys. Congratulations. Thank you. What do you tell people the key to getting out of debt is? I think the key is really just to, it's to set an intentional budget and then to remember why you're doing what you're doing. So the mission behind why we were doing what we were doing to grow our family, to become generous, like that's what really pushed us through. And then,

what made it easy was being really intentional so that every dollar app, it's been amazing for us where we can both see it and understand our finances better and combined. And it's just, and then being on the same page, making sure that we understand how we both work with money and to just be able to communicate. And so, yeah. So great. Yep. Indie?

Yep. Shepard, Tyler, and Alyssa, the Chicago area. $96,000 paid off in three and a half years, making 97 now down to 80. Count it down. Let's hear a death-free scream! All right. Three, two, one. We're dead! Yeah!

So sweet. Oh my gosh. Beautiful family. How fun is that? Beautiful family. This is The Ramsey Show.

I know you work hard for your money, and the key to keeping more of it in your pocket is by making a plan for your spending with a budget. And EveryDollar is the budgeting app that I use personally because it's perfect for looking every dollar you make in its little president face and telling it exactly where you want it to go, just like you told that guy in traffic exactly where you wanted him to go. And even better, EveryDollar walks you through the entire budgeting journey so you always know your next right step. Download it now.

Download every dollar for free in the App Store or Google Play today. Rachel Cruz, Ramsey personality, is my co-host today. If you haven't downloaded the Ramsey Network app, you need to do so. It is free, and it has 100% of the shows on the Ramsey Network, meaning that, like, for instance...

This show on podcast and on YouTube is getting ready to conclude, and yet there's another segment that we'll be doing and will be on the Ramsey Network app and that some of you in talk radio will get.

So you need to download the Ramsey network app and we put other things on there. Like we put the, uh, Donald Trump interview on there the day before we put it out to the public on YouTube and podcasts. So you got a day early, that kind of thing. And, uh, uh, spoiler alert, there's another one coming next week. It's not the vice president.

We have reached out to her, but it's not that one. But I just did a long-form interview yesterday that you will want to hear. We'll put it on YouTube, but we'll put it out a day early on the Ramsey Network app. And the app search feature is great, too. It really is. So if you're looking for content and you need quick answers with that, it's great. And it's free. And you can ask a question on the app.

And that's what Katie did. Does contributing to your HSA count towards your 15% investing? I have built up quite a bit in my HSA, and I'm thinking about investing within it. And how do you know what funds to pick? I would not use my HSA towards the 15% because your HSA can only be used for medical purposes.

If you use it for anything else, it's taxable and penalized. And I would, until you're 65, and after you're 65, you can do a withdrawal on it like you can on anything else. So an HSA is a health savings account that is tax deductible and can be used for medical. Okay? And meaning that the government's paying part of your medical if you do that. It's tied to a low-cost service.

health insurance plan because it's a high deductible health insurance plan and you cover the deductible with the HSA. It is not an investment vehicle by choice. You should use investing vehicles in your 15%, meaning mutual funds in your 401k, Roth IRAs, and those kinds of things. Having said that,

I'll answer the rest of your question. Once you get to baby step seven and your house is paid off and you're maxing out things left and right, then you can use your HSA as an investing vehicle. And I have. George W. put the first HSAs in place. And the day they were put in place, I bought the first one because I love the concept. Is that how new they are? Yeah.

I didn't realize they were that new. Well, it's not that new. That's 20 years ago. Four presidents ago. Yeah. Five presidents ago. Anyway, for a long time, I've been doing all they would allow me to do in the HSA, and knock on wood, the Ramseys have been pretty healthy, and I haven't had to use it. And so...

It has turned into an investment vehicle. And then when you get to baby step seven, like I have, and I max out 401ks and I max out backdoor Roth IRAs and I max out every single thing I can do to keep the government stinking hands off my money, then I'm also going to max out an HSA as an investment. I'll never use it for medical. I mean, highly unlikely I'll use it for medical.

I'm already 64. I can start withdrawing it next year for any reason, medical or otherwise, at 65 if I want to. So I'm using it as an, and now I've got like, I don't know, there's $400,000 or $500,000 in this stupid thing just because I've chunked money in it for all these years, and we moved it into mutual funds. And you can use a company like Health Equity is what we use, and we move the money into mutual funds inside the HSA. But you should not be doing that.

until you get to baby step seven and you've maxed out regular retirement plans first and you got your house paid off first then you would do stuff like this this is like when you've when you've done everything you can do what's the last thing you can do this but you at your stage no you need to be doing 15 15 into good retirement is all like regular 401ks and roth IRAs

Yeah, and I think the HSA question is, I think it's a great question, Katie. I'm glad that she submitted it because I feel like we are hearing, yeah, I don't know, more questions around it because I don't think some people realize that it can even be an investment vehicle eventually, that that's even an option. Yeah, and here's the thing. Everybody's always looking for these little nuanced hacks, this life hack, this investing hack that's going to make the big difference. The big difference is do the main stuff steady and do the nuanced stuff as icing on the cake.

Okay, here's another example of that, all right? Nuanced things that people talk about like it's some kind of big breakthrough thing, and I see it sometimes with overhyped and some weirdo on TikTok or something, but here's what happens, okay? Rachel...

12-year-old Rachel is working the back book table at a live event selling kids books and helping us load the truck and worked hard and got paid. Didn't have the option, but I'm glad we got paid. We send them to the salt mines. So poor little child abused children. So anyway, that's what set her up for her success.

Anyway, so she gets paid and then she's babysitting some 12, 13, 14 years old baby. And I added up the amount of money that she actually made and filed a tax return. One year, I think it was a whole $1,700 or something. Teenage income. Filed a tax return.

I paid what little tax there was due, if any, on $1,700, but that enables her to have an earned income at 12 or 13 years old, and we did a Roth IRA, and you can put up to your earned income. So that year I dumped $1,700 into Rachel's Roth IRA. We did that again at 14, 15, 16, 17, 18. She didn't put any of the money she earned in that. I took $1,700 of my money and did a little Roth IRA for her. Okay.

But you do that four or five, six times, and then they're 21 or 22 years old, and they come out of school, and they'll look down, and they'll be $100,000 in a 401K. And if you're 22 and you have $100,000, you know what that is when you're 42? Hello. But that doesn't make you rich if you do everything else stupid. So that's a little nuanced trick, like the HSA is a little nuanced trick. It's icing on the cake. It is not the cake.

And you don't need icing if you got no cake. So, I mean, you need to do the middle stuff, the big stuff, right? And not try to replace the big stuff with all these little tic-tac hot hacks that are out there. I have a life hack. Oh, you're killing me. All right. Just do the life. The newest or not the newest one. The one I just saw recently is using life insurance while you're alive. Oh, God.

Explain that one. That's a good one. That's a thing. That it's like, oh my gosh, I don't have to work. Which one is that? Is that the stupid whole life thing? It ends up being a whole life insurance policy. Honestly, I didn't really understand. I was watching. I'm trying to figure out where he was going with it, but...

Is that what it was? I think it ended up being a whole life, whole thing, because he had a product he was selling. Well, there's another product that, of course, you can... But he's saying like... If you're terminally ill, you can sell your death benefit. No, no, no, no, no, no. This is like actually pulling out... Oh, that's a cash value bull crap. Yeah. That's more ticked. I mean, these bad financial products that we... It's like a disease. We in the financial world thought we had it and not... Had vaccinated everyone against the disease and then...

Tic-Tac comes back and spreads the disease again. We almost had it done. It was almost dead. And then some little fart revives the thing on Tic-Tac. And all of a sudden, whole life is now a big. Not everyone in the financial world knows whole life sucks. And then this little guy, God almighty.

Okay, so let's go positive because we only have like two minutes left. So I don't know if we'll get to a call. But I mean, it's the thing. No, no, no. Okay, so that's a good question. Kids, let's go in that direction because you went there with the Roth IRA kids. A lot of people ask, okay, what can I do besides saving for my kids' college? What can I do to set them up? Is it UTMAs? Is it mutual funds? That's not besides kids' college. That's in addition to kids' college. That's an example. Kids' college is a cake. Icing Roth IRA with the babysitting money.

Okay? Don't do that and say, well, I'm not doing kids college because I'm doing the icing. No, do the cake. Have money so your kid can gain knowledge. Here's another one. I'll make you mad real quick. Don't pay for your kids college, but get a house, have them pay you rent. So that way when they graduate, they may have student loans, but they'll have a house with more equity. See, everybody's trying to do double backflips instead of actually just doing their work. Yeah, you're right. That does make me mad. It's just dumb. It's just dumb.

Pay for stuff. Hello. Quit trying to figure out a way to... There's no shortcut to any place that's worth going. Do the cake, then do the icing. This is the Ramsey Show. ♪

Hey, you're still here? What are you doing? You do know that the rest of today's show is playing right now over on the Ramsey Network app, right? All you got to do to finish the episode is search Ramsey Network in the App Store, Google Play Store, or just click the link in the show notes to download the app for free. Yep, you heard me right, for free. Then right there on the home screen, you can watch the rest of today's show. Bada bing, bada boom. All right, I'm getting out of here. Enjoy. We'll see you on the app.