Transcription
[Music] Sara's with us in Savannah, Georgia. Hi Sara, how are you?
Good, how are you doing?
Better than I deserve. What's up?
I'm calling because I have a year and a half left in school. I've set out for the last year, did some financial reasons, of course. I have $29,000 in student loan debt, and I'm just trying to figure out, is it worth going back to school to get more in debt to complete the degree, or just work on tackling the debt? And also, I'm currently engaged, and we're trying to do like a cruise wedding. So I'm just trying to figure out which is that.
Wow. And so what do you make?
I make $28,600 a month. I mean, a year. I'm sorry. Yeah, it'd be nice. Yeah.
And what does he make?
$26,000 yearly.
Okay. And what are you planning on spending on your wedding?
Um, well, if we knew the cruise destination, we're looking at about $5,000.
Okay. And do you have $5,000 right now?
No.
When, when is the wedding?
We were looking at tours, November of this year.
So can you show you $5,000 between the two of you by then?
Yes, we started budgeting this year and we figured by the time April comes, we should have at least $5,000.
Okay, good. That's a good plan. All right. So we're gonna pay cash for the wedding. Your whole wedding expense is $5,000?
Yes.
Okay. It's an inexpensive way to do it. That's good. And kind of a cool thing. I like it. When you are married, your household income will be about $55,000 a year. Okay. You make, you have $29,000 in debt. Do you have any other debt?
I just bought a car.
You just bought a car? Yeah, because I didn't have my $1,000 base for my emergency fund, and my 2010 Ford Fusion needed some repair, like CV axles, great, minor things, but they still add up.
Mm-hmm. So I, my expensive car. Did you buy $20,000 with the 2014 season? You're kidding me. You spent $20,000 on a car?
Yeah.
And you're broke?
Yes.
Sell the car. Okay, that was stupid. Okay, tell me, you know that was stupid. I felt the brunt of it. Acted like three days later when the general said, "Well, you have 30 days to bring it back." And I'm like, I just feel like a scam. Are you within the 30 days?
I brought the vehicle. No, I think my 30 days, I might have just ended last week.
Call them and call them and beg them, uh-huh, to let to let the 30 days count and let you take you back. And you go, and you go get you a $1,000 car. Okay? You know, honey, you only, don't even start talking. Okay? Not after doing that. I'm giving you a hard time. You have to know that was dumb. You make $28,000 a year. You signed up for a $20,000 car debt, and you are already $29,000 in debt on your student loans and broke.
Yeah.
You have to hear that. Okay? I'm not trying to be mean to you, but you got to break this thing out of your brain, or you're gonna constantly as a couple be wandering back into this mess, and I'm not gonna be able to help you because you're gonna continually go back to this, back to the slaughter. I mean, you just walked out right in front of a gun and said, "Shoot me." I mean, it just, I don't want, I don't want you to live your life like that, honey. So here's what I'm gonna do. I want the two of you, as my wedding gift, to go through Financial Peace University. That's our nine-week series. Once you get that car taken back, call them today. And once you get your little, little beater car or some kind to get by until you get some mess cleaned up. Now, what were you studying in school?
Okay, ministry, healthcare administration.
And what do you do for a living now?
I'm an assistant manager at the DMV.
So you're not in the healthcare field?
Yeah.
Do you want to be in the healthcare field?
I do.
Okay. Can you study that at night and finish it and pay cash as you go, maybe after the wedding?
Yes, but some of the classes do require me to be in the actual.
Do they have, do they offer them at night?
Yes, but with my work schedule, I don't generally get off in time to pay so close.
Yeah, you might have to rearrange your work schedule in order to finish your degree. But I don't know that you necessarily have to do completely all school or all work. My point is, maybe we can finish up school while we're working, while we're married, and while we're paying off the debt. And but pay cash for the school as you go. You pay cash for it. And whatever you're going to do, don't add debt. Pay cash for whatever you do as you go. Work your way down through it that way. And and pay cash for cars as we go. Pay cash for the wedding. You already got that one on the run. Good for you. That was a good decision. And we'll pay cash for the cruise wedding. But let's, let's say, let's take as many classes as we can. And then if we have to talk to the B&B and say, "Guys, I got to dial back a little bit because I'm this close to finishing." And for one semester here, I need to be able to take off on Thursday nights, you know?
Okay.
They'll work with you. Or if they won't, find a different job. Yeah. But I wouldn't just quit my job to go back to school full-time.
No, no, no.
Okay. This more so for more income. Okay. Yeah. I think, I think you can make more with your degree. And I think it's a good degree to finish. And healthcare is a good field to be in, particularly healthcare administration, with as much upheaval and chaos as there is in that world. Someone that goes in there with a cool head in the middle of all this mess can probably, you know, do some good for some companies. And theirs, and with a little bit of academic, it, you know, under your belt. So you're right on track. But the glaring thing in this discussion is this poor car. And please talk them into you and your fiance go over there and go, "Hey, we just got engaged." And you guys, please, if even if we have to write you a check, take the count this in the 30 days, even if we give you $1,000 just to say thank you, give him a tip, you know, to pay the salesman or something, right? But be able to take the thing back because it's just insanity. The numbers on that just take my breath away, how bad they are. And I want you to get, because with no car debt, and the wedding is saved up and paid for, and we're paying cash for college as we go along, and then we can begin to knock out the $29,000 as well. See, you're gonna be in a really good place in a very short period of time. But when you drop a $20,000 stupid car loan in the middle of it, it just blows the thing up. It makes it very hard to pull off. So really, really, really bad decision there on that one. But you can recover from it. Let's get out of it. Let's do something to get out of that deal. Please work very hard to get out of it. And don't use them saying no and smiling as an excuse. You've got to work your way away from that. It's just really, really bad. So, and hold on, Kelly, I'll pick up. I'm gonna put you through Financial Peace University. It's my wedding present to the two of you. What the two of you to go through the class together, and you'll see what I'm talking about. It'll start to come together for you. And you just, you see how avoiding debt causes you to be in a position to be outrageously generous and to build well.
Brenda's with us in Phoenix, Arizona. Hi Brenda, how are you?
Taking my call. Sure. What's up in your world?
Well, we're in a big mess. I just started listening to you later about a couple of months. I read your book, "Some Money Makeover." And my, um, my question is, I have a lot of people tell me I should just do bankruptcy. And I don't want to go that route. And I'd be like me listening to you. So I wanted to, if where am I at? I have babysat one. I got my $1,000. I'm safe.
Okay. How much debt do you have?
I have, um, I have a home equity from six years ago, $100,000. Six years ago. Sister, is it? You still have the home?
No, we lost the home. But the home equity, we bought, if we got the $100 to buy the second home, which we lost four homes six years ago.
Okay. So you're $100,000 on that. And have you been paying on that?
No.
How long has it been in default?
It's six years.
You've not paid on it in six years?
No.
Okay. What else?
I have a $40,000 medical from two years ago, and haven't paid on it in two years.
Nope. Nothing. And my dad, $18,000 in credit cards. And that, are they any collections now?
So for the last six years, we have not done anything.
Have you been paying on the credit cards? When was the last time you paid on them?
I haven't paid on parties for the last five years.
And I do have two credit cards for assuming you know, you know, there's any papers, food equipment, they're sending the women. They actually sent you lawsuit papers or a letter saying they were going to sue you?
There's a law firm that doesn't matter. Was it an actual lawsuit?
Long court documents that said you had a court date?
Yes, it was from last year.
And, and how much are those two cards?
Those are $5,000. And that's part of the $18, or is that in addition to the $18?
And what is your household income?
Oh, myself employing with the average of every year about $60,000.
So why have you not paid bills?
I don't know. I don't know. We just, I don't know. Just I don't know. We kind of just hide under and didn't take care of it, you know? Where we are, you know, we're being renting for the last since we lost our home.
No, we, I would like to move on. And, you know, filing a bankruptcy would clear this $158,000 in debt. Okay. It looks like you've got. It would clear that at chapter seven. I'm not sure you're going to qualify for a chapter seven. It might, the means test might throw you into a chapter thirteen, which would cause you to pay payments into bankruptcy for five years. Are you, II, what was, is his income steady at $65,000 or is he starting to increase his income?
It goes up and down.
Are you working outside the home now?
I'm at the position like, where my kids are now are going to school, and I'm able to get a job, you know, in the morning. You know, she's the job is weird, so different hours, different schedules, so I'm doing one can run the kid around. So I'm considering the job.
You need to add some income. If you can add $20, $30,000 income to this situation, it changes everything. Yeah. Okay. So here's the thing. If we add up all that debt and say it's $158,000, $160,000 for the debt. It is very, very old debt. By and large, they have given up on it. Even the one that serves you, even the one that sued you, isn't doing anything with the lawsuit. They just took a judgment against you, but they're not doing anything with it. Meaning they've not come and garnished wages, they've not come and try to take money out of your bank account or anything like that. So, you know, they're not, they're not being that aggressive or proactive. I mean, they're probably calling you occasionally, some of them are in raising Cain, but they're not actually doing anything. You follow me? And the debt has probably been sold. And if it's been sold, a lot of it's been sold to debt buyers. And they buy that at around a nickel on the dollar.
Mmm-hmm.
Five cents on the dollar. Okay. $50 for $1,000. You follow me? Which means that if you made them an offer of 10 or 15 cents on the dollar, you could clear all this debt. And I would take a lot of work to contact each one of them, negotiate with them, get them to accept that. But eventually, you could work your way through this for around 10 or 15 cents on the dollar. No, the home equity. Do send me enough for last year for $25,000 to say that's a quarter on the dollar. They're already closed. But you don't have $25,000. So you'd have to save up the money to make them an offer. They're going to be the hardest one. Starting. So you'd have to save up. You need a lump sum in your bank account. And then you call them and go, "I have $15,000 cash. I will give you today if you will settle this." And they'll take it. They'll take it. But they're not gonna take it easy. They're gonna whine and try to negotiate, try to get more, go back and forth. And the same is true with these others. So that tells us that it will take you two years of hard work and saving and negotiating and fighting and scrapping and arguing with these people and getting it all in writing, all these different accounts. Okay. It's a lot of administrative work for you. But if you did that for two years, you can clear this debt for somewhere around $20, $25,000 total. And you could save up a little bit, clear one, save up a little bit, clear one, save up a little bit, clear one. And, you know, the last one is the home equity loan. And you save up $15,000 and boom, you knock it out. Okay? That's your alternative to bankruptcy. Or you can file bankruptcy. Either one. But I, I think you can work through it. But you really have a lot of work ahead of you to work through it. But I think you can do that. You're broke. You know, any money as you save up money, you call and negotiate with them. Now, if you're gonna go that route, make sure any settlement you agree to, that they agree to before you give them any money. Two things you have to remember: get it in writing, and never an electronic access on your checking account. Always in writing. And don't let them have access your checking account. And don't give them any information about where your husband works or where you bank or anything like that. You have to stay, stay in the distance, in the fog, and negotiate with them.
This is the Dave Ramsey Show. Roderick is with us in Pittsburgh. Hey, Roderick, how are you?
I'm doing well. How are you?
Better than I deserve. What's up?
Well, yes, in a nutshell, my wife and I are planning a move to start our careers. She is graduating, you know, about a month or so. Well, we both have a substantial, not a student loan debt, the neighborhood of, well, over $600,000.
$600,000?
Yes, well over.
We're both positions. So freaking brain surgeons? What's your specialization?
I'm family medicine, psychiatry.
Oh my Lord. All right. These are not exactly high-paying fields. How'd you get $600,000 in debt with that?
Well, I'm personally, I came from a single-parent household, and I had to pay for college, graduate school, and medical school. So alone. And my wife also took out loans to pay for graduate school and medical school.
So what do you project your incomes to be first year?
Well, for residency, we're starting our income will be about combined about $108,000.
A bit. But when you get out of residency, what do you predict your world comes to?
Bright. When we gather our residency, you should at least triple, if not quadruple. I think we would both make in the neighborhood of about $200,000 to start.
Either a family man behind or not. Well, income has increased significantly for failing medicine in the federal here.
No, none. Okay. I work with talks all the time. They'd only $100,000. What you're looking at unless you get an unusual gig of some kind. If you can get $200, I'm not gonna be mad at you. You need it because you sure have a dadgum huge mess on your hands, right?
What a mess.
Uh, yeah. Yeah. So you guys, you guys need to live like college students until this is gone. I don't care what your income is. You know, and not good. So the question that I had was, in tons of this debt, is it, I guess conceivable to consider it as more of a mortgage in terms of debt? When you consider the baby steps?
There's no mortgage. But I wouldn't consider it a mortgage. No. You need to clear it up. Two years. Okay? You know, you're making $400,000. You need to live on $50,000 and clear it up in two years, right?
And that was what does definitely the plan. We don't plan to buy a house or anything until we clear up in the hallways. The parties.
How would you consider it a mortgage if you're paying it off?
Well, I was, we were thinking in terms of baby steps and sort of the first years now I've been paying off that and then building up emergency fund. So we allocate. We're making $400,000 a year or $300,000 a year. You're not gonna need much of an emergency fund. Oh, and they said I'm just talking about starting this year because I making that much money isn't until about year one or five. You know, so that's one of that's what's scaring me here.
But yeah, you need to live on nothing and pay everything above nothing towards this disaster. You need to be in panic mode, dude. I mean, I can't breathe, and it's not even my debt. $670,000 worth of debt. And you're just nonchalant about it. He won't you operating on me? Unbelievable, man. What a mess. Yeah, you need to really, really focus on living on nothing. No house buying, no car buying, no vacations, no eating out, and completely focus on cleaning up this mess. To do this is, if you do not do that, you're gonna be in debt for decades if you're not careful here. I'm so sorry. What a horrible thing to be facing. I can't imagine how overwhelming that must feel or should feel.
Liz in Orlando, AL. How are you?
I'm doing well, sir. How are you?
Better than I deserve. What's up?
So I just started your program and I'm on baby step two. And I have an issue. I make about $120,000 a year, but I have about $125,000 that's. And I have a vehicle that is about $910 payment a month. My question is, how do I get out of this? What can I do? I don't know. I'm just so small. This feels, I'm not sure what to do.
Holy crud, $910? What are you driving, dude?
Just a pickup truck.
The Dodge pickup truck?
Okay. What in the world is this thing? I mean, how did you, is a high interest rate?
High interest rate, 16%. 73-month payment. I've been paying on it now for about probably two years.
29 months.
Audio on it today. What's the payoff today?
I believe it's $29,000.
It's worth about $19.
Okay. Goodness gracious.
Mm-hmm. How much is your house payment?
I'm $1,300.
Your truck payment's almost as high.
Oh, yeah. I mean, if I'm in your shoes, I'm waking up. Don't, don't you wake up and every time you get in this thing and start the key on it, you wish it would explode? I mean, you got to be kicking yourself like every time you drive it, right?
It was an absolutely.
Yeah, I mean, you make really good money. Congratulations. Yeah. And really, selling this truck is not gonna fix the whole $120,000 problem, but it helps with cash flow so considerably. And I gotta be honest with you, if I'm in your shoes, I've done a lot of stupid stuff. I mean, I've done stupid with steroids. I know what it looks like. Okay? And so when I do something stupid, I don't like to be reminded of it every day. Does that make sense?
Oh, God.
If Dave was in there, I'd be selling it just so I didn't have to remind me of it every day. I mean, I'm not sure it's gonna make that big a difference in your short-term finances, but I just wouldn't want the 16%. I feel like I'm being, you know, I'm being abused every day. Which you are. And I'm looking at this thing. It's like pointing stupid arrows at my face every day. I would have to get rid of it for those two reasons. It helps also with the money because the $910 is gonna clear a lot of debt for you month. That's $1,000 a month towards your other stuff if we can get you out of this. So what I'm gonna do is run out with the credit union. Your credit's obviously trashed. And see if you can talk them into borrowing the difference.
Where's the loan crisis?
It's a Chrysler credit.
Yep. I didn't realize they did subprime stuff like that to that level. Wow. Okay. Yeah, you gotta borrow that $10,000 that you're in the hole, or you gotta save it up to get rid of it. One of the two. So you can get the things sold.
Where'd you hear, where'd you get the $19,000 value?
What is that?
Just Kelley Blue Book's. Is that retail or wholesale?
That was if I sell to a private price.
Okay. And that's probably your real value. And you probably rolled some negative into this too, didn't you?
Yeah, it was about $2,000.
Yeah, yeah, that makes sense. All right. Yeah, I'm, if I can find the money to cover the difference that you're in the hole, if I'm in your shoes, I'm getting rid of it because I don't want the reminder. I don't want the 16%. And I need the $900 to clear my dad. It's not like it clears all. There's only 20% of your dad. So it's not, doesn't really fix your debt problem short-term. But it does do those three things. And so I am dumping it because it's just the whole deal is just absurd.
Wow. I'm so sorry you're facing this. Ouch, ouch, ouch, ouch. Thanks for calling in.
Scott is with us in Chicago. Hey, Scott, how are you?
Gonna call this. Sure. What's up?
So I'm on day number two. And the thing that seems to be doing the most trouble and the most frustrating is I have $60,000 in student loans. That's to be paid back over the next. Actually, so I paid like the minimum, which I don't plan to do. But so cost me over $100,000. That's absurd. It's not even an option.
Yeah. So what do you make?
Oh, well, I make on a thousand.
Good. So how fast are you?
50.
What's that?
So how fast you're paying off?
50.
One year. I will, I guess, I guess my question is, why they don't drive off? Why not?
Okay. Why not pay?
I'm not to that payment. Yeah. I'm so going off a couple of other things.
Oh, okay. So you got other debt? How much other debt have you got?
In a car. Cool.
But you make $100,000?
Are you single?
No, engaged.
Oh, good, good. Cool. When you're getting married?
December 2nd.
Oh, okay. You haven't paid for part of that?
No. Good, good.
So, so basically, we've got from now into December making $100,000. And you got about $54,000, $55,000 where the dad is that right?
Okay.
So you're not quite gonna make it in a year, but you ought to make it in 18 months, shouldn't you?
Well, a hundred minus, well, let's just say 18 months. 150 minus 60 is 90. You can't live on 90 in the next nine, 18 months, not counting taxes.
I guess I lost you there. Someone. Okay, let me try again. You make $100 a year. Okay? So a year and a half of income would be $150, wouldn't it? Right? Minus $60 worth of debt would equal $90. Minus type. Minus taxes, right?
Minus taxes.
But you can't live on $90 over 18 months.
No, you're right. I am not.
No, no. You're you're broke, man. You're not invested in retirement. You're getting out of death. Not even if it's not. Dude, I don't care if it's matched 20 times over. You have $50,000 in student loan debt. You just call me up whining about paying it off over 20 years. We got to change that. If you'll get this out of the way, your most powerful wealth-building tool is your income. And right now, it's all committed to somebody else. I want their name off your income in the next 18 months. Then you're in a position to boom, man. You could smack the crap out of that 401k after that, right? Does that make sense to you?
Yeah.
Just leave it there. But stop adding to any retirement temporarily. Wait, you're a new, you're a new listener, right?
Yeah.
Okay. I'm sorry. I was treating you like an old listener. I'm beating you up. I apologize. Okay. So here's the thing. We teach a thing called the baby steps, or you do one thing at a time in order. Right? With the premise, the premise of this is that your most powerful wealth-building tool is your income. If you have no payments, you're in a position to build wealth very quickly and very easily. And that includes building first an emergency fund of three to six months of expenses. So baby step one is $1,000 start. That's a little starter emergency fund. Baby step two is no life, scorched-earth lifestyle or cleaning up debt because we're gonna be, we're gonna be so intense and so focused and get it out of our life as fast as possible because you have $60,000 of barrier between you and your dreams. And I want it gone. Boom. Punch it. Okay? And when you knock that thing out, then that set you have to go back to that $1,000, raise it up to a fully funded emergency fund. By the time you do that, you're married six months. Okay? Okay. And you got her income in the mix, which is going to change the equation here. But I'm just using this as an example. Three to six months of expenses are set aside. And now you have a fully funded emergency fund. Let's call that $20,000. And you have no payments in the world. Does that feel pretty good?
Yes.
Now you step in and you don't take the measly 3% match in the 401k. You accept puppy outter. You take it up to 15% of your income. Then we'll save up and pay off your house next. And with no house payment, holder, you everyone cool. By the time you're 40, you should be have your house paid for and all this stuff cleaned up and a paid-for house. And dude, you'll be a millionaire by the time you're 45 if you do that. Guys, yeah, the math works. I'm not making this up. I've done it before. So here's the thing. Well, you and your fiance are getting married in October. You said?
Yeah.
Okay. So we have a nine-week class called Financial Peace University. You go once a week, one night a week for nine weeks. And it shows you all this stuff. And it shows you how to handle money. It's not get rich quick. It's get rich slow. It's the hard way to do it, but it works every time. And the number one cause of divorce and money fights in America is are the number one cause of marriage fights in America is money and money problems. So I'm gonna give you to that class as my wedding gift. And I'm gonna show you exactly how to do this stuff. And then you call me back if you've got any questions. I'm gonna pay for you to go. Hold on, Kelly's gonna pick up. We'll get you signed up and get you going. Boom. We'll get this whole thing started out there. Guys, it's amazing if you just take a step back. And that interesting how you think, "20 years, I'm gonna be in debt." And then one conversation and some basic math and you go, "Hey, hey, wait a minute. I think." And don't get rid of this now. The highest probability chance you have to building wealth is to be debt-free. Folks, your highest probability chance of getting out of debt is to be very intense, very deep cuts, and do it fast. Band-aid off quick snatch. That's the best way. Put. And so that's how you don't take it off slow. You snatch it. You get after it. That's the highest probability of getting out of debt, which then gives you the highest probability of building wealth and being outrageously generous throughout your life and being in control because you have to learn to be in control to pull this off. But hey, nobody wakes up a millionaire. Goes, "How that happened?" It was accidental. No, it's intentional steps, people. This is the Dave Ramsey Show. Tony is on the line in Tampa. Question for Ken Coleman today. Hey, Tony, what's up?
Hey, Dave. Hey, Ken.
Are you doing good?
Are you sir? Doing good.
I just lost my job this morning. I'm 24 years old, going on 25. And I just lost my job. It was a six-figure income.
So you know, a hard job to find. What in the world happened? And what were you doing?
So I've been in the car business my whole life. Kind of just got thrown into it. The whole family, you know, everybody's in the car business. For the same company, I was selling lots of cars, first place, every single month. And, you know, some of the cars that were selling, they had, you know, bad CARFAX. I'd work with a guy for five days straight, and the CARFAX would be bad. And I decided to leave the car fact, you know, out of the, you know, I didn't show the guys the CARFAX. So I guess that could have been a lawsuit or something. And they ended up firing me. It was Mercedes-Benz, so, you know, they're real strict with everything. You leave the toilet seat open, you might get clipped.
Hmm. Well, first of all, we're sorry. This is not a fun day. But I want at least encourage your heart for a moment. You're gonna survive. You've got to learn from this. Anytime something like this happens, you don't want to move on from this. You want to take as much personal responsibility as you need to. And then figure out, okay, what do I learn from that? Not let that happen again. And move forward. So six-figure income. We've got to ask on the Dave Ramsey show, where you at financially? Where are you at in the baby steps? Do you have any kind of emergency fund?
Yeah, I've been putting a little money away.
At no, my job's real strict and the security there's not too good. I'm just by, you know, knowing where the managers are at mentally and that kind of they're just real strict with everything. I've only worked there. And I said six-figure income, but I've only worked there. This is my third month there. And my first, second, and this month, I'm all in first place with a perfect CSI, which is, you know, your surveys that come back. So my customers loved me. But I was thinking with emotion more than I was with my head. So I know that's where I went wrong.
Well, Tony, so where were you at? Do you have an emergency fund at all? What is it? How much?
Um, yeah, I have about $15,000 saved up.
Do you have any debt?
Yes, I do.
How much?
My bills every month or right around $2,000 a month.
Yeah, but how much debt do you need to pay off? If you look at all the money you owe, how much?
How much debt do I need to pay off? I'm sorry.
No debt to pay off. I'm renting my apartment and my car is least. I know you hate that, Dave, but it is least.
Alright, Dave, I'll let you handle the money stuff in a second. Here's what you need to do, Tony. You really need to, I think you ask yourself the question, why did you do what you did, which got you in a situation where there was a clear company policy and you violated it, and they take that stuff serious, and as a result, you're out of a job. So you really need to reflect on that. We don't want to beat up on you, but that's important. Secondly, do you love sales? You're 24. Do you like to sell?
Yeah, I love to sell. In certain environments. So there's certain places I've sold that that I didn't enjoy. On the first real job that I did like was Mercedes. The clientele, the money, of course, and the cars. I enjoyed selling the cars.
All right. You're 24. Where'd you go to, what did you go to school for? Did you go to school? And what was it for? What was your major?
I started college and I was just gonna get a business management degree because I had no idea what I wanted to do. So I was like, "Just to go to school for something." I ended up not going for. I ended up stopping school after about two years, you know, once it started coming out of my pocket. I just really, you know, didn't care about what they had to say. I was more interested in making money and that kind of thing. So for a couple years now, the professional poker player.
Okay. Well, Tony, you're all over the place. So I'm gonna give you a couple pieces of advice. And this is something you're gonna need to do actively. First things first is you've got a little bit of a cushion with that $15,000. You're single. I'd get rid of the lease, obviously. Dave kind of can speak to that. But I want you to sit down with three people. You can make it five or seven. I don't care. But some people who really know you, they care enough about you to tell you the honest truth. They'll be blatantly brutally honest with you. And I want you to ask the question of yourself, and then let them answer it, which is, what is your greatest talent? What do you do better than anything else? And then what do you care about? If you love selling, but you want to sell something that lines up with your values, I mean, it matters to you, then that's where you need to be heading. But before you even make that big decision, you need to get employed. And you need to lick your wounds here and also learn some valuable lessons.
Dave, Tony, my son is 25. And this is what I would tell him if I heard this story from him. Number one, you have a tremendous upside. You have a gift with people, and you have the ability to sell. What sometimes comes with that is a BS artist. And you've been biessing, even on the phone here. Toilet seat up is way different than freaking not giving a CARFAX report. You should have been fired. You deserved it. Not because you're not a good salesman, because you completely violated the thing here. I'm a Mercedes customer. You completely violated that. You would have been fired if you were working for me. And I would have cried because you're such a good salesman when I quit, when I fired you. And I would have cried for you because I wouldn't want to break your little heart. But you, man, you just completely stepped in it. And you cannot allow your, your gift with people to think that that entitles you to cut corners. That's the poker thing. That's cutting corners. That's the going around the CARFAX thing. That's cutting corners. Your gift with people doesn't give you the right to cut corners. It demands that you go right through the middle. And that integrity become your number-one goal posts that you check everything on from this day forward. If you'll take that with your personal gift with people, you're gonna make $200,000 a year for the rest of your life. You're gonna be very wealthy. You're gonna have a lot of healthy, great customers because I can tell you this about you. You like selling a quality product. Mercedes is a quality product. And you like dealing with intelligent customers because most of what most of Mercedes customers are well-heeled. They love that product because it's a quality product. Most of them are very successful themselves. They're easy to sell to for that reason. Again, I'm one of them. But you've got to take that other little piece of this and digest that part of it from today and make that your goal post. So I'm gonna be the first one in your corner. Like Ken said, put three people in your corner that loves you enough to tell you the truth. You have a tremendous gifting, young man. You can be anything you want to be. You could be the CEO of a major company with your ability to deal with people and your ability to sell. But you can't. You will never achieve that if you shortcut. If you think you are the, if you think you get to go around the side of something because of your verbal gymnastics. Kim, you can. You and I both have that ability. And so it's talking to both of us. I've done the exact same crap when I was his age. Here's the deal, Dave. This is a roadblock or a stop sign that he created for himself. And it's a gift at 24 to go, "Wait a second." This is a temptation for anybody who loves to sell. You know this. Any others know how to use a word properly. And there's a phrase, there's a thrill in getting the deal done. Yep. And it, it'll cause us to be tempted to cut corners like you said, Dave, and end up getting ourselves in big trouble. Know why you love to sell and love what you are selling, so you're not tempted to cut corners. So if you get this lesson from this firing, you'll look back when you're 34 and let's take a tour and you'll say, "This is the best day of my life." If you take the lesson away that they were right. They were not petty. Toilet seat up is petty. You tried to match it up with petty. It was not petty. It was deserved. But you're a good man and you've got the ability to make big money and do the right thing with this gifting. And you're gonna, you're gonna be somebody, dude. Call me back and I'll help you. I promise.
This is the Dave Ramsey Show. Roland is with us in Joplin, Missouri. Hi, Roland, how are you?
All right, Dave. Thank you so much for talking. And thank you for sharing common sense.
Sure. How can I help?
I've been, I've heard you speaking to people for us about loved ones. The loved ones are making bad decisions. But I'm married to that person. And some of the bad decisions have kind of led us and hurt our family, led us into a bad place. Weren't homeless. Very much behind on bills. Yourself. I like to get all the bills caught up. We're about $4,200 behind on just regular bills, rent, electric, utilities. But, you know, how is that her fault? Partly mine too, because I let it happen. Yeah. She, long first off, on the river, a truck driver. And while I've been on the road, some of her friends that she had had problems in their lives and become homeless. And she wanted to try and help me. So she let them move in the house. At the time, didn't think it was a good idea because we were kind of struggling ourselves. But she went ahead and did it anyway. And a lot of our resources have went into the last eight months of trying to help those people try and get jobs and get back on their feet. And when, where are they now?
I've gotten all of these out of the house.
There's only.
I thought you said you were homeless.
Well, we became homeless two weeks ago.
Before that, how it happened? We've gone over your foreclosed on? No, behind on the rent. And addicted.
Okay. So where are you living currently?
The hotels, campgrounds, whatever we can get into.
So obviously, all of those people you were helping are now gone?
Yes.
And so what is your income right now?
Okay.
And how far, how much do you owe in back rent?
About a thousand dollars.
And how much?
And you said $4,200.
And what else?
$1,700 in electric, $500 in gas. Think we got the water caught up. And the rest is mostly recent medical bills.
And that's another $3,000 or $2,000?
Or what about $2,000?
Yeah. What kind of medical bills? What kind of medical event did you have?
I have Crohn's disease, sleep apnea. And it's study trying to get the sleep apnea taken care of. And doctor's visits. A lot of times.
Are you, if I thought I'm 34? How long have y'all been married?
Will be 10 years in September.
All right. So if I were to sit down and talk to her, would she tell me she's learned her lesson?
Yes.
And I've also tried to sit down to hold on, kind of a dream meeting and see what we can, where we go from here.
Mm-hmm.
Since you have learned your lesson. And what she tells me is that she doesn't want a dream. Doesn't want to think about it because she, if we dream and it doesn't come true, she doesn't want to be disappointed.
Mm-hmm.
Well, let's dream not about not being homeless. How's that? That would be pretty cool to not be disappointed. You know? And let's dream about getting this little handful of dirt. You know, $5,000 changes your whole life.
What did she do for a living?
She's disabled. They say. Some with kids. This takes care of the kids.
And how much disability is coming in?
Well, she's going through the disability process right now. It's kourt's.
What is the nature of her disability?
Physical pain. She had a head-on collision with a bundt truck and has left her injuries on the left side of her body that prevent her from standing for long times and or doing a lot of physical work. But she could do white-collar work, I think so. Yeah, because you guys need some extra income right now.
Well, so I think she needs to find a job so that you're not homeless and so that $5,000 comes in and you clean this mess up. So let me tell you what I'm hearing, Roland. Okay? I'm hearing a couple who's every individual part of their life and their marriage is completely spiraling out of control. There are so many different variables that are crazy. And what you gave me in about a three-minute thing here, that it's no wonder y'all ended up where you are. And I'm not saying that to put you down. I'm saying that there's a lot more going on here than your wife couldn't control her spending. There's a marriage breakdown. There's her absolute lack of judgment that's beyond belief. And yet she's supposed to be watching over children, and she's disabled, and yet not getting disability. So she needs to be working. And you've got to somehow interface with all of this and take over these bills and put the family back on. I don't know that a dream meeting is in order. A crisis intervention might be in order. But I don't think a dream meeting is in order. We might have a nightmare meeting. Like, "How do we get out of this nightmare?" But that, that start. So what I would tell you to do if you were my 34-year-old little brother, and you are, is to grab a local pastor and sit down with them. And let's start the process there with marriage and spiritual walk. And you guys start trying to just push some of the crazy out of your life. And let's try to get back to some solid ground in the middle, in the center of your life. And then rebuild your relationships based on that. And start making positive, responsible decisions, both of you, that involve work ethic, involve for galatea, involve laying out a plan. And you can do every bit of that. It's very, very possible. But I, I think that's where I would start if I were you. Is I'd pick up the phone, call a local pastor, say, "Hey, we're homeless. It's our fault. We're not coming in for money. We're coming in for some leadership." And I, as a young dad, a young husband, I need some guidance, pastor. And let that pastor counsel you as a man and counsel you guys in your marriage. And let's lead you back into putting, putting together a solid plan. And I'll put you in Financial Peace University in the area there. But if that's all you do, it's not gonna work because there's a lot more going on here than just a financial issue.
or to your financial problems are the symptom of all the crazy going on in your life and man you got to sweep the crazy out of the corners over there that's what's that's what's overdue so if you do that you'll see this turn around but hold on Kelly I'll pick up we'll get you signed up for Financial Peace University and we'll try to figure out what we can do from there so hey thank you for the call are you Jessica hi Dave how are you better than I deserve what's up all right so you want in off three years but and I've read the Total Money Makeover book my husband is not a fan I have to put that out there first but we have some serious debt and it's all pretty much you don't loan debt from my husband going to law school and so right now we are in an income based repayment plan which so we haven't really been worried about this debt because after all if they're like 20 or 25 years it'll be forgiven quote-unquote but I happen to look at one of the balance statements a cop like a few weeks ago and it's gone from 100 a hundred and ninety thousand in ciemins at two hundred fifty thousand and student loan debt and so because of the interest and so I'm kind of I'm starting to panic because I just mmm sorry I don't know how to get out of it what's your household very okay what's your household income my husband he makes 90th out about ninety thousand a year and when your service you know we I was gonna say you know we bought into this sort of idea that a lawyers going to make a lot of money so it wasn't a big deal to take the school loans out but he's basically he started working public right out of law school and then you know his salaries increased over the last four years about 60 grand but it's still obviously not gonna put a dent in the school loan issue so how old is he 35 35 so when you say he's not a fan you mean he's not a fan of getting out of debt it's not that he's yeah I'm not sure I don't know exactly why he he doesn't care for your program it's not the getting out of debt part I think he doesn't want to think about the school loan and I don't think he wants to I think part of our problem is that we don't know what to do about it and so we see beans and rice like I've cut our budget because I do listen and so I've cut our budget down and we don't have cable we don't have a lot of the extras or cell phone bill is like less than $80 a month for both of us because his work pays part of his and I mean so I tried to cut down in all of the areas that I can and you know and food and all those things which are not saving money and you're not paying extra on the debt so you're not doing a written exactly you're not doing a written plan or every dollar you're just cutting stuff I'm cutting stuff this is the first month because of I looked at it a few months ago notes or a few weeks ago and start listening to you again this is the first month where I've really done the budget out so that we're going to have and we have about eleven hundred dollars extra a month after all of our bills are paid that's do you have so the school loans and then we we've had we've had a camper for a few years so that we like 13 just under 14,000 on that and then we had bought a truck last year to pull the camper and then we owe 38 thousand on that but we don't have any credit card debt or anything like that but so you just guys you know I know you're scared but you just keep doing stupid stuff well yeah because you did you know so I'm hopeless about getting out of debt and so I'm not gonna willing to listen to anybody I'm putting words in his mouth so let's go about $38,000 truck to pull our camper wow wow well part of the thing was I wanted to sell our house last year I actually wanted to live in a camper we homeschool and I wanted to be able to you know rode school and kind of do some nut stuff so the idea that we was that we were gonna sell the house and then we were gonna we were gonna live in the camper and then that all changed because he wasn't ready to do that but we had we bought the truck in anticipation of that so yeah we're not the I feel like we're smart people but financially not doing super smart things and then we bought a new house disposed because we sold our house but there's a lot there's a lot you guys can't get on the same page and so depending on whether he wants to slap his foot down or not you guys are lurching back and forth from stupid thing to stupid thing because you don't have you not having do not have a clear goal and you are not relationally on the same page on any of these decisions and it's causing it's causing them to multiply the problem instead of doing oil you need to identify a clear concise goal that the two of you are willing to sacrifice to get to and that means sell the truck and sell the camper and it's the house getting equity in it it probably has a little bit of equity in it but it's from you know we just bought it in August so yeah I mean yeah and then we're gonna get on a tight budget and we're not going out to eat we're not going on vacation when we begin to attack this and as his income goes up it's probably a five-year plan to pay off $150,000 for the student loan debt but until you get rid of this it's not going to do anything but get worse because the income-based always goes with negative amortization which means that the interest is higher than the payments you're paying so you're going backwards and exactly just it's it's financial suicide and yeah and the fact that you cannot seem to get on the same page and i don't know i'm i don't know whether i'm hearing fear from him or arrogance from him or maybe both but the way you're describing the decision-making in the way you all interact it's not healthy and so you guys got some work to do on that to get on the same page I really can't help you unless both of you want to do something because what you you can't cut cable and fix this right you can't not go to Starbucks and fix this this is going to require a Hercule it's a huge mess and it's are gonna require a unified approach between the two of you to be able to win financially because you know when one of you goes and makes a decision then the other one grabs the wheel and coarse corrects you're jumping back and forth from stupid is stupid and really magnifying this mess I'm sorry for you I know you're scared but I'm I mean the fact that you guys can't sit and have a good conversation and come to a good conclusion to the point that you're you know on a national radio show crying tells me something about y'all's relationship and that that's scaring ya that's scaring me so the two of you need to work on that I I'm gonna send you to marriage counseling first is what I'm gonna do and when you get back from that if you want to go through Financial Peace University Kelly you Kelly's gonna pick up she'll get your contact information and you can contact her at that point and then I will be happy to pay for you to go through Financial Peace University but I don't want you going to Financial Peace University by yourself because you're gonna end up divorcing this guy if you do and that's and I don't want to cause that that's not that's not where I want to go because you're gonna start having real firm knowledge based opinions and and he's not gonna play that for that this has got he's got to be in on the idea and you guys got you have to have a unified front on where you're going with this it's the only way it's gonna work for you so you need to sit down with your pastor and start working on some of these relationship issues to where he's as a good husband he should be a whole lot more concerned about how scared you are than he is and willing to do something about it if there was something I could do for Sharon and she was this scared a hundred percent of time I'm gonna do it and and you know you truthfully you've got a right to be afraid because this is a pretty sizable mess and doing nothing about it is not gonna bring you to a good place so I'm so sorry you're facing this but hold on and Kelly will pick up she'll take your information then if you guys come back from marriage counseling and you want to go to FPU we will pay for it I do not want you going by yourself though that would be an unhealthy thing for you guys right now brian is with us in Sioux Falls South Dakota hey Brian how are you I'm doing great Dave how's your day better than I deserve what's up so I have a question that's listened for 12 years your guidance has actually enabled me to ask I am 26 years old recently invented a new electrical wall place for hiding Graduate sensor wires and I'm about to retire congratulations big dog well done man that's awesome so so you invented this thing and you've sold it for a bazillion dollars so I actually sold it with a forty thousand mile road trip listening to your show all the way across the country for a year just going door-to-door and it's now nationwide distributors and it is taking off and running itself okay and so well nothing runs itself so you built a company or you've sold the item to a company or how's it being run so I am still dying at part-time basically coordinating voices between my distributors and my suppliers but my workload has drastically dropped below the 40 hour week mark wow good for you okay and so III have no buy of no okay so what's your question we've done very very well obviously oh it's all day because of you and everything's been cash flowed you know we're just as a design engineer and gettable Tilford 20 you know two thousand dollars for a lawyer for months I'd be able to cash flow and just did that till I got ready to launch so what that financial guidance allow me to do is I'm still single how do I approach any eligible girl I meet and what do I tell her about my income well it's interesting because you don't want to be a target is what you're saying for the wrong exactly you don't need a gold-digger we used to call them in the old days wow well my son is 25 and he kind of has the same problem because he's my son right he didn't have any more money because I'm not dead but someday he's gonna be in really good shape you know so you know and he and I have talked about this a time or two but it's not ever really been a problem I think the healthier you are personally as an emotionally and spiritually the more normal you are in terms of I don't mean normal in a bad way but I mean you're just a regular person but if you're whole you're not needy emotionally you've not got some kind of weird ego thing going on which I don't hear and talking to you you just sound like a guy who came up with a great I didn't worked his butt off to me that's what it sounds like and so just be that guy and you know do you have any family in your life yep that one brother and my parents still around okay cool I would use them as a filter with young ladies that you're that you're seeing and just to have other people look over your shoulder in case you've got a blind spot for one and they see things and give them permission to speak to you about it and go you know if you think somebody's after me for the wrong reasons speak up okay and go ahead and just say that out loud Daniel has two sisters and I can promise you they're filters you can't pass the sister mafia your big time you know so that happens you know and but I think the more hole you are spiritually the more hole you are emotionally mental health wise the more you're going to just naturally repel those kinds of people I meet for instance guys who go through a midlife crisis and you know you know marry the supposed trophy wife right the second wife that's after money kind of thing and most the time it's those guys just aren't very sure themselves as men and so they attract that you know they need they need harm candy to feel good about themselves and you're not just don't be that guy you know you're looking for someone you're looking for somebody's beautiful on the inside yeah and by the way it's a plus if they are on the outside but I mean it's they're beautiful on the inside and and you're just gonna take your time and then of course where you're meeting people matters because you know where do quality people hang out and that's where you need to be hanging out but as far as when to disclose the net worth I think you do that or your income or those kinds of things the fact that you've become wealthy later rather than sooner but certainly you don't want to spring it on someone but you know after you're engaged that would be weird you wouldn't want to do it but but you know you don't go out the first date and start spouting off about it you're gonna track the wrong kind of people and I would be pretty secretive about it not we're not in a weird way but I just wouldn't live a real flashy lifestyle that that you know Daniel drives a pickup with about a hundred thousand miles on it he doesn't he didn't have to but he driving in one stride probably but he does were very well on his own that's my son as an example so you know you can just do whatever and that way you're not putting off signals that that that that there's wealth here but then yeah the more serious you get the more you begin to unpack it and I would just begin with some other money conversations and make sure those go well and that the relationship continues before I got into that so yeah it's certainly not a first date thing and it's certainly long before engagement but somewhere along though you long there you just start talking about work ethic and saving and how they feel about wealth and how they feel about that kind of stuff and so now let me ask you this is is this over ten million dollars so has a market potential about 43 million a year that we're currently extracting only about 1% of oh you're making about a lot it or a choice in the world so you're making four or five hundred thousand a year already yes net yes okay and that's what that has just started yep so we are I'm very much in the baby stages where I'm used to my 80k a year engineering sorry yes and I told my friends around me if you've seen me change yell at me and be very honest because I don't want to change from the young conservative Midwestern Christian that I started with I don't want to become a different person just because I now can be yeah well you need to be a different person but you don't necessarily need to show at all yeah you need to be you need to be capable of managing more and that's gonna be different you know it's a different thing making 400 then it isn't making 80 so I well here's the thing I do not recommend prenups in normal situations but this is not a normal situation and so because you're probably going to have a multi-million dollar net worth before you're married is what it sends to me like and so you probably do want a prenup in those cases are you at least need to consider it and it's not because she's weird or you're weird it's because when there's that much money around weird can just show up in the form of her mother or her aunt or something like that you know and then the influences start moving and it it negates their influence when there's a free done agreement now again I don't believe in prenups in normal situations but where there's extreme situations I do recommend them Candice is with us in st. Louis hi Candace how are you hi baby Ramsey how are you better than I deserve what's up I am in $200,000 and that I haven't even finished college and right now I can't work in the minimum job I mean minimum wage job and and I'm just trying to get a hold of my life right now so I'm just trying to get some guidance at this point what were you doing going $200,000 in debt well I was on school for filming videos and at first I was for interior designed and I transferred to a different school for filming video so that's pretty much the school's work that our book that I was going to were out of state good lord yeah and I'm not they're not bother you that you were running up that much dad I mean how to cheat that's how do you Ramona I went to school right out of high school and my parents they didn't know much about you know financing or at least they didn't teach me anything about it they just told me that I'll have these student loans and I had to pay them back and I really wasn't conscious of you know even long in that sense so how much do you like before you graduate I have only like a year left and I want to go back to school to get my degree Yeah right now I just want to at least try to take the big chunk out of the student loans at least a little bit of it yeah well you don't you know you're not I'll do that make a minimum wage obviously you're bad you're barely eating making it how old are you I'm 28 this is another thing that I am working on so I am working on a movie and I'm putting my money that work into the movie into the movie and I also have sponsorships that's helping to fund the movie and I also have a partnership as well and so I'm just taking a leap of faith that this movie will bring a substantial amount of money what makes you think that um it's your faith in I believe the storyline it's a good storyline and it's a good content to cover I mean do you know anything about distributing a movie and monetizing it well this is the thing I mean it's an independent movie and I know that my partner he is going to help you know that any of the funds that we need in order to get it to where we need to go basically you know he's it's basically his faith into my project that's that's how okay I want to see you live your dream and I want to see the movie be produced and and get out there but I'm also duty-bound as your old ugly uncle to tell you the truth and that is is that you have a pattern since you're 20 years old of entering into things and not carrying what they cost and not knowing what you're getting into I mean the movie business is a rough-and-tumble business independence that independent movies they go out there and make big money are almost none right you're got to be aware of that yeah I'm aware I'm totally aware of you can't you know you can't listen I'm a person of faith but there's there's faith and then there's just dreaming and so I want you to have a solid business plan by which your faith is executed and my partner is going to put some money into it and get it where it needs to go that's not a business plan the movies yeah movies get made every day that nobody sees that's true and lots of independent movies get made every day that nobody sees and I'm okay with you working on your dream but you you've got to start entering into things whether it's your continuation of your education whether it's the time you're spending on this movie the money you're spending on this movie or whatever it is you've got to start entering into things with your eyes more open and just going oh we're just going to start this and it'll all work out because maybe it hasn't been working out and if you smell let's say you let's say you spend two years on this movie and you get zip out of it oh no I'm not spending two years won't go ahead but I mean that that's you know you've got to have a an understanding of the behind the scenes part of how a movie gets launched and how it turns into money that you don't have today otherwise you can't spend your time on it and because it's not a dream anymore it's it becomes a nightmare like you're going to school as your parents dream for you to go school but nobody thought about what you were spending on that schooling and so you've gotten yourself in an absurd scenario with $200,000 in student loan debt or can a minimum-wage job it's just a horrible place to be for you darling I just feel so bad for you so I want you to start things in your life that you can see in detail how they can occur and that is faith - that's wisdom is what it is and wisdom goes with faith and so step by step by step how am I going to get my career rolling actually make some money a high probability of making some money not one shot in the dark which is really what a movie is it's one shot in the dark and I don't mind you working on that but that probably ought to be your side gig while you work on something else that makes you some money and you get over there finish your degree and then you get out there making 50 60 80 100 1250 thousand you know you get yourself a career track going kiddo so you can get this mess cleaned up and you can live a life because right now you've got this this monstrous oppression over the top of your head of this debt I'm so sad for you I wish I could just wave a wand and make it go away but what I want to hear you what I want you to hear and I want you to hear me loving you and not saying I'm not a dream killer I'm not a dream stealer but I am somebody that tries to prevent nightmares from occurring and right now you got a nightmarish occurrence with a student loan debt and if you don't develop a detailed plan on how this movie turns into money and you keep working on it you're entering into another nightmare so you need to have a pattern where you what Stephen Covey said in the books this seven Habits of Highly Effective People is you you begin with the end in mind and it's not just I'm gonna make this movie and I have faith that's going to make me a bazillion dollars that that those are words that that indicate you don't know what you're doing and you need to go find what you're doing and that's the that's when you put wisdom and faith together and as you start doing those things you're gonna see some differences I'm not trying to hurt your feelings and it's not my goal here I'm trying to love you well kiddo while you're here on the air with me so I want you to go through our class Financial Peace University since I picked on you and I picked on you for your own good but I want you to go through the nine week class I will pay for it I'm gonna give it to you for free because you need some good people in your life to gather around you and help you walk through this that can see the end in mind with you as far as the this being this debt and getting your money under control and really getting your career on track too so I'll tell you also Kelly when we pick up and you give her a Financial Peace University also give her the book start and Candice I want you to read that book as soon as it comes in the mail once you sit down that day and read that book it won't take you that long it's a quick read and it'll really help you get your arms around what I'm talking about where you lay out a plan a roadmap to go towards being awesome and I want you to be awesome I want you to win but um you know you have to hand that book you know start takes you through that roadmap it's what it does and it'll help you do that so hang on Kelly I'll pick up and we'll get you in Financial Peace University and get you that book and if I can help you all your fighting through all this you call me I'll walk with you I'm on your team I'm not here to kill your dreams I'm here to keep from turning that keep them from turning into nightmares hey guys thanks for watching if you enjoyed this video click the subscribe button to get the latest content and check out these other great clips from the show [Music] you [Music]