Rachel Cruze
Appearances
The Ramsey Show
Your Future Self Deserves Better Choices Today
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The Ramsey Show
Your Future Self Deserves Better Choices Today
Yeah, and what's so hard is I feel like one of those, especially the ones that I'm like, oh, it's terrible, are people that call in and their spouse has passed away suddenly, and they don't have life insurance. When you have to think through how am I going to pay my bills in the middle of all that grief, it's terrible.
The Ramsey Show
Your Future Self Deserves Better Choices Today
So life insurance is the one thing, especially as a mom with three little kids that I'm so big on for people to get because it's inexpensive. Zander is the place that Winston and I actually get all of our life insurance.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And Hannah, you could use that $1,000 if something came up that you weren't expecting. Because that's kind of how we qualify an emergency. It's when it's urgent and it's unexpected. So something comes up and you're like, I have to do it now, right? It's not like a... Something comes up and I could fix it in six months, right? That wouldn't be the emergency fund.
The Ramsey Show
Your Debt Should Make You Uncomfortable
This is like, oh, this has to happen today. And also, Hannah, in your checking account, we always say to have a buffer in that as well so that you're not, you know, There may be enough of a buffer and you're checking out to cover some small expenses that come up because you're going to have a miscellaneous category in your budget, ideally.
The Ramsey Show
Your Debt Should Make You Uncomfortable
So there will be things that come up throughout the month that you don't expect. But ideally, it's coming out of the budget there. You're not having to touch the emergency fund. The emergency fund is only when it's kind of big expenses related.
The Ramsey Show
Your Debt Should Make You Uncomfortable
um that you're like oh gosh a couple hundred bucks and it's you know we may have to dip into that but i always like having a cushion jade in my checking and depending on where you are in the baby steps you know if you're in baby step one through three you know maybe a couple hundred bucks in there as padding um and maybe you bump that up more as you get into baby steps four five six and seven but i do hannah want you to have a buffer in your checking that's
The Ramsey Show
Your Debt Should Make You Uncomfortable
not emergency fund driven or savings driven, but it's more lifestyle driven, if you will, just so that you don't go into the red and you're checking. So I hope that helps. Thanks for the call. We have two more segments coming up this hour. Give us a call at 888-825-5225. I'm Rachel Cruz hosting with Jade Warshaw, and we'll be back.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Really the best way to make the most of your money is by sticking to a budget, creating a budget and sticking to it. I mean, it's probably the most powerful tool from a tactical standpoint when this comes to gaining control of your money, knowing where your income's going, knowing where margin is so that you can pay off debt and save and all of it. There's just something proactive
The Ramsey Show
Your Debt Should Make You Uncomfortable
about telling your income what to do and if you've not downloaded every dollar make sure to check that out this is our budgeting app and you can actually download it for free create your first budget and really get in this habit and this rhythm of your life of budgeting and do and do this regardless of where you are financially those of you you know like the last caller who's working to save up a thousand dollars all the way to those of you on baby step seven that the house is paid for everything's done
The Ramsey Show
Your Debt Should Make You Uncomfortable
tracking your monthly expenses is so important because it just gives you this gauge of where your where your money's going financially and it just gives you a sense of control there's so much in life that we can't control so when you can't find these things that you can actually get in a rhythm and be proactive with that is your income and that is a budget so download every dollar for free in the app store or google play or you can click the link in the description if you're watching or listening on youtube or podcast we'll put a link down there but go and
The Ramsey Show
Your Debt Should Make You Uncomfortable
Download EveryDollar. All right, going to the phones. We have Austin in Nashville. Hey, Austin, welcome to the show.
The Ramsey Show
Your Debt Should Make You Uncomfortable
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 amazing relationships. I'm Rachel Cruz, hosting this hour with my good friend and best-selling author, Jade Warshaw, and we are taking your calls, America, about your life and your money. So give us a call at 888-825-5225.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, for sure. How many more years do you have left, Nick? How many more semesters?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Oh, OK. OK, I gotcha. Yeah. And honestly, Nick, in that state, when you're in something like college and you are cash flowing out, which is so great, I still would recommend not even investing really at that point because just having liquid cash in case something happens, it's always a smart idea. And even after college, right, you graduate college and if you move,
The Ramsey Show
Your Debt Should Make You Uncomfortable
Okay, I mean, I would, Austin. Honestly, like, you're in a great position. No kids? Seasonally, just to, like... All the way. I mean, like I would tell them I will work as many hours as you will give me. And then another thing to think about is the ratio of car debt to your income. It's right on the line.
The Ramsey Show
Your Debt Should Make You Uncomfortable
We always say we want to know more than 50 percent of your annual take home pay or your annual income. And and so that, you know, you're 35 is kind of what you're projected at right now. And 14. Yeah, you're just kind of on that line. And I think it's one of those questions, even though you are upside down on it.
The Ramsey Show
Your Debt Should Make You Uncomfortable
I probably, in your case, would just pay it off, but always be thinking through with debt, what is worth it? Because you want to, you know, calculate how many hours and how much money it's going to take to pay this car off versus if you're like, you know what, it's worth, is it nine private sale or nine to a dealership for a trade in? Did you look online? Um,
The Ramsey Show
Your Debt Should Make You Uncomfortable
nine private okay i mean yeah at that point you're probably break even but um but just yeah in the future it's just a good uh mental exercise even for people listening or watching especially with car debt to say okay how many how many hours extra am i gonna have to work to keep this car versus if i sold it took out a loan for the difference uh maybe a couple thousand more just to buy a beater
The Ramsey Show
Your Debt Should Make You Uncomfortable
And how significantly you'll get out so much faster. But again, Austin, in your case, it's kind of a break even from that point. So yeah, I would just be working extra. And then at the same time, Austin, be looking for a full-time job of something that you want. And you're in a great, I don't know, I think FedEx, UPS, a lot of those places, it's great employment.
The Ramsey Show
Your Debt Should Make You Uncomfortable
So if you are there for longer than maybe you're expecting, I think that's okay. But also know your next...
The Ramsey Show
Your Debt Should Make You Uncomfortable
um to take a job somewhere moving expenses and moving costs like there's just a lot of reasons to have money liquid at your age and then once you graduate you get settled you get your first job then you can really dive into investing and at that point for you you'll be at 15 automatically which is so great for some people they have to wait a few years to start investing so um so i wouldn't i honestly wouldn't rush into it and i think um
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, where are you graduating from Austin? Is it an online school or-
The Ramsey Show
Your Debt Should Make You Uncomfortable
Oh, okay. Okay. Gotcha. Yeah. Well, I hope that helps, Austin, just in the sense of just some encouragement that you're in a great line of work with FedEx right now from a seasonal perspective. So take advantage of that over time.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Um, and, and, and this plan hopefully will lower that stress and Jade's right to map out a specific timeline of, okay, you know, September of next year, where am I going to be? Um, if I, if I start paying this stuff off and I would pay the credit card off like.
The Ramsey Show
Your Debt Should Make You Uncomfortable
I mean, yeah, I mean like it's 500 bucks too. And we talk to people, Austin, all the time. Yeah, all the time who are doing extra side gigs. And Jade, when we talk about this on the EveryDollar webinars and we ask them like, hey, how much, what do you do for a side gig, a side hustle? And how much are you making? Some of them are making $2,000, right? I mean, just for extra side hustles.
The Ramsey Show
Your Debt Should Make You Uncomfortable
So there is ways to get this thing paid off in six months. It's very, very doable, Austin. So I think that will really propel you into some motivation to pay this off.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And for all of you graduating, you know, now we're in May, live like a broke college student until this debt's paid off.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Keep that lifestyle. Because I think the problem is, is when you get your first job and you're getting a salary, you know, this career, you're thinking, oh my gosh, I'm a grown up now. And your expectations of life suddenly kind of creep up of what that lifestyle looks like. But if you stay low on lifestyle while you get this cleaned up, I would rather be doing that at 21, 22, 23 than 31, 32, 33.
The Ramsey Show
Your Debt Should Make You Uncomfortable
I know, that's right. You got it, Austin. Thanks for the call.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Welcome back to The Ramsey Show. We are in the holiday spirits, Jade. We are in the middle of, I don't know, still shopping. I think I'm pretty much done. I have nothing wrapped. Oh, man. But Santa at our house doesn't wrap gifts. He just pulls the gifts out of the bag, and they just are there under the tree, not wrapped. So that's always convenient for Santa.
The Ramsey Show
Your Debt Should Make You Uncomfortable
so what goes does anything go under your tree ahead of time gifts that mom and dad buy like we'll buy you know i see like one or two things that we'll wrap but uh but they unwrap a lot of gifts from like parents grandparents uh there's a lot of unwrapping happening there which is great but yeah so that's a good idea i might uh take you up on that yeah that was my santa growing up childhood never wrapped either so
The Ramsey Show
Your Debt Should Make You Uncomfortable
It can feel like it goes against this idea of compound interest because we celebrate that so much of how great it is. And the earlier you start, the better off you're going to be, like all of that. But you'll catch up. Like if you start all of this at 23, you will be fine financially.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Which is nice, but we're still going through our lists of gifts for like, we draw names on both sides of the family. Smart. All the things. So where are you at with all of it, Jay?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Okay, and I actually, when you were saying it last year, I remember it and being like, that is so true. Like if Aunt Linda needs something, like she can get it. Yeah, she's fine. Like Aunt Linda, especially if you are getting out of debt, you're on a tight budget. And it's been a hard year or two, you guys, like with inflation and stuff.
The Ramsey Show
Your Debt Should Make You Uncomfortable
I mean, it's just people are just getting the necessities paid and there's not a lot of room. And so it was this guilt-free reality that adults can take care of adults.
The Ramsey Show
Your Debt Should Make You Uncomfortable
So I think it's more important to have as much money, just cash available for these big transitions is the smartest thing.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And I think that's the yeah. And I think the level of discipline and planning, some people just don't they don't do. And it's a little bit on a whim. And that's where people get in trouble with money is because it's so emotional.
The Ramsey Show
Your Debt Should Make You Uncomfortable
and all of these emotions are driving your decisions and usually when that's the case when our logic isn't doing it and it's our emotions we do tend to overspend we make spontaneous decisions that probably are not great in the long run because in the moment it feels good it feels right and then you look back after logic is set in with maybe a level of regret of realizing oh my gosh and and this is the reality too jade is that you know we're again we're not like we're
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, I would just... Just this year. Sure, I would leave that. I would only touch that money if you needed it to get through school without debts. But I think it sounds like you already have a plan on the other end to do that.
The Ramsey Show
Your Debt Should Make You Uncomfortable
the Grinch stole Christmas kind of people, but 28% of Americans are still paying for Christmas last year. I heard a stat that said 49%. Oh my God. Oh, wow. Like any level of that. So there's obviously a clear boundary issue that we're having that we're not able to afford. And so to your point, the kids are the priority. Christmas and the Christmas spirit and all the stuff, right? It's the kids.
The Ramsey Show
Your Debt Should Make You Uncomfortable
The adults are going to be okay, right? So prioritizing that. And even within your kids, right, of your family, if it's going to look different than last year, because maybe this year is the first time you are doing it on a budget. Mm-hmm. Talk about it. Communicate it. Talk about the difference. Christmas may look a little different this year. Yeah.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And then even thinking through the motivation, too, of why you're buying everything in the first place. That's always a big question for me because even for kids like I am. This was probably two years ago, Jade. Everyone like on social media, on Instagram, they were just posting like Christmas Eve, like Merry Christmas.
The Ramsey Show
Your Debt Should Make You Uncomfortable
you know oh yeah and it's just like a picture of like their tree and like all the gifts and stuff and I was like oh I was like well that's kind of sweet so I did it as we're going to bed like we had our lamps on and it was just a pretty little picture so I just you know and then we had our gifts out from yeah we had our gifts out and so I took the picture and just captioned Merry Christmas and I got so many comments on my minimalist Christmas oh they're like Rachel where's the gifts oh whatever so refreshing it's just a minimalist Christmas at the cruises and I was like
The Ramsey Show
Your Debt Should Make You Uncomfortable
this is regular i thought we like i thought we were doing i thought we like had a great christmas but then as i looked through i'm like oh no from what people people go hard in the paint and again it is not bad if you have the money and this is where you're choosing to spend it that is totally fine yeah nobody's you're grown you're grown and we're also the moms you and i both talked about this yesterday during a break when we did the show yesterday
The Ramsey Show
Your Debt Should Make You Uncomfortable
I also had three trash bags full of crap that our kids just don't use in the playroom and in the closets in the room. I'm like, so then it's just stuff just ends up building up. And that's the consumerism where I'm like, I'm not going to buy you stuff just to buy you stuff either. So that's such a good point.
The Ramsey Show
Your Debt Should Make You Uncomfortable
I'm going to end with a with a hater comment, Jade. You ready? If buying slippers hurts your wallet, you have other problems. This is very financial illiterate advice.
The Ramsey Show
Your Debt Should Make You Uncomfortable
If slippers hurt your wallet, you have other problems. Is exactly what we're saying. Yes. Yeah, it does. So then we got to dig into that. Why that is. All right. Well, Jade.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Great segment. Thanks for giving us the Christmas spirit. We appreciate it. Thanks to all the guys in the booth. And thank you, America. This is the Ramsey Show. We'll be back. You've got a lot to keep organized in life. Kids and calendars and carpooling and cleaning. I mean, it is so much. That's why you need a knockbox.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Perfect. Thanks, Nick. For the call. All right. Up next, we have Jay in Anchorage, Alaska. Hey, Jay. Welcome to the show.
The Ramsey Show
Your Debt Should Make You Uncomfortable
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Your Debt Should Make You Uncomfortable
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Your Debt Should Make You Uncomfortable
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 amazing relationships. I am Rachel Cruz, hosting this hour with bestselling author Jade Warshaw, and we are taking your calls on life and money. So give us a call at 888-825-5225. We are here to chat with you.
The Ramsey Show
Your Debt Should Make You Uncomfortable
All right, starting us off this hour is Allison in Philadelphia. Hi, Allison. Welcome to the show.
The Ramsey Show
Your Debt Should Make You Uncomfortable
How are you guys today? We're doing great. Thanks for calling. How can we help?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Merry Christmas. Absolutely. How can we help?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Surprise. Surprise. Yeah. When did all this happen, Allison?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Man, I'm so sorry. Okay, I mean, it would be so difficult to be grieving the loss of your husband and then at the same time uncovering this other reality that you had no idea was happening, financially speaking.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Okay. So walk us through, you may have said at the beginning of the call, but what's the state right now of where you are financially? After you've uncovered everything, where are you?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, I'm curious why you're not able to contribute to the 401k because you chose a different package for a benefit, for your benefits?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Are you making an income, Allison, right now?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Allison, there's a lot of you taking care of people, including your own children, your grown children right now. And I'm not defaulting you, but there is something to...
The Ramsey Show
Your Debt Should Make You Uncomfortable
understand Allison that you have to take care of yourself first and foremost right and that's not a selfish idea you can't take care of people while you're drowning right you have to get yourself in a very stable position and so um so he had this life insurance did he have any retirement I mean I'm assuming with all the foreclosure stuff he like yes um yes uh it was it was it's in stock okay how much is that a year I'll get 20 grand a year for six uh years and it was 117
The Ramsey Show
Your Debt Should Make You Uncomfortable
Okay. And, and then, yep. And you have a 200,000 in life insurance. How old are you?
The Ramsey Show
Your Debt Should Make You Uncomfortable
And you have to determine what Jade was saying earlier too, Allison, that with this house, you were, you know,
The Ramsey Show
Your Debt Should Make You Uncomfortable
essentially should have been be able to make these payments on you know 150 000 income is what he's bringing in around that and you and to supplement that you don't have that and so i don't want this house holding on to this house i don't want you to drain everything just to keep the house to jade's point earlier so um yeah if you if you hold on the line um emily's going to pick up and we are going to set you up with a financial coach because um
The Ramsey Show
Your Debt Should Make You Uncomfortable
getting all of this and from a legal perspective yes the contacts that you need and all of it and they're going to be able to ask even more questions allison than we can on in six minutes here on a one call in the segment um because there's probably other things there as you start pulling a string to really figure out and get yourself like in a position of all knowledge to start making wise decisions with all of the information possible so hold on the line and we will give that to you as our gift and we are so sorry that that is what you're up against it's terrible
The Ramsey Show
Your Debt Should Make You Uncomfortable
I don't know about you, but I love the new year. It's a fresh start. And I get to reflect on the good things I wanna keep doing and the not so good things I wanna change. And I know a lot of you are psyching yourself up thinking, okay, this year I've got to get my finances in order. And big goals like that are really exciting, but they can also be overwhelming.
The Ramsey Show
Your Debt Should Make You Uncomfortable
That's why it's so important to have a plan. So before you do anything else, start with a budget. Start with EveryDollar. I love EveryDollar because it's so easy to plan out your spending and keep track of it every month. Plus, most people free up on average $400 in their first budget to go towards their goals. Guys, this can be an amazing year.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And if you choose just one good habit to start, choose budgeting. Download the EveryDollar budgeting app for free today. Welcome back to The Ramsey Show. Up next, we have Katie calling us from Dallas, Texas. Hi, Katie. Welcome to the show. Hi. Hello. So glad to be here. Well, thanks for calling. How can we help?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Well, I can see how you're overwhelmed with that because that is overwhelming trying to do all of that at the same time. What's causing you? What's the motivation in trying just to get it all done? Do you feel like you're behind on investing? You don't feel like you have enough savings? There's a lot of debt. What's causing you to do this?
The Ramsey Show
Your Debt Should Make You Uncomfortable
and my car that is 11 170. okay um so yeah so part of this paying off debt for most people that call the show katie i would say nine out of ten of them don't have money to pay off these credit cards in this car so we're going to be talking to them about
The Ramsey Show
Your Debt Should Make You Uncomfortable
working extra sacrificing lifestyle all of it but your position is completely flipped because you you have that cash so like what jade was saying is that's a big green check light but also katie we want to establish new habits so that we don't get back into this place of debt again so what were you using the credit cards for the the two um just spending okay um
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, and the three to six months too, Katie, is enough to cover to what jade's saying when these big things come up to cover with cash but it's also not so much that you're getting frustrated that you're not making a lot on return right so it is that perfect medium are you single married kids what's like your life status I am married. I have one baby. Okay.
The Ramsey Show
Your Debt Should Make You Uncomfortable
So since you like security, Katie, I would go more the six-month emergency route versus the three-month. Yep. So I would stick with that six months. Do you know from an operating budget perspective how much money you guys need per month just to keep kind of where you're at? And I'm thinking, you know, mortgage payments, utilities, gas in the car, food, all of that.
The Ramsey Show
Your Debt Should Make You Uncomfortable
What would you guess to keep you guys afloat for a month? How much money? Um...
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Your Debt Should Make You Uncomfortable
No. And considering it's, you know, is it pre or post tax?
The Ramsey Show
Your Debt Should Make You Uncomfortable
yeah and when you're talking about you didn't know much about investing a great place to start katie a roth ira is a great option you and your husband both can open it up you can both put seven thousand dollars in and that grows tax-free and within that roth ira you'll invest in mutual funds and i would sit down with a smart investor pro to to kind of get all this started and then do you and your husband both have um retirement benefits at work like 401ks or a 403b
The Ramsey Show
Your Debt Should Make You Uncomfortable
I do not. I believe he does. Okay. So yeah, so I would use that 15% to fund two Roth IRAs, go up to the match with his 401k. And how much do you guys, household income-wise, are you making a year? I'll say $60,000. Okay. Are you guys working together with your money? Do you guys have a combined checking account? No. No, we don't.
The Ramsey Show
Your Debt Should Make You Uncomfortable
It's pre-tax. Okay. So yeah, so I would probably, I think you're going to be better off, and again, talk to a smart investor pro, but when you actually look at everything, I mean, even from index funds to mutual funds, you'll get a better rate of return just doing something like that, even though you'll have to pay capital gains when you pull the money out.
The Ramsey Show
Your Debt Should Make You Uncomfortable
What's he say about what's he say about all this? Does he want to? Does he feel out of control? Money wise? Is he feeling like a little bit like, oh, gosh, are we on track? Have you guys been talking about it? And that's why you called? Or is this just you on your own feeling it and you don't know where he's at?
The Ramsey Show
Your Debt Should Make You Uncomfortable
How long have you been married? Five years. OK. How are you feeling about that? Do you like how that is or would you rather say, hey, we're a team in this and all together we're like working towards our future together with investing and we know what's going on?
The Ramsey Show
Your Debt Should Make You Uncomfortable
And starting us off, this show is Nick in Detroit. Hey, Nick, welcome to the show.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And so, yeah, sorry, Jay, does he have debt, Katie? Do you even know? Yeah. Yes. How much does he have?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Katie, do you care to stay on the line? We have to go to a break right now, but I'd love to keep talking if that's okay. Are you okay if we hold you over to the next break? Yes. Okay, thanks, Katie. Katie, you stay on the line. We have a hard break right now, but we'll be back and unpack some more of this because I think this is a great to be able to help her and for you all.
The Ramsey Show
Your Debt Should Make You Uncomfortable
This is where a lot of people are in America from a financial perspective. So we'll be back.
The Ramsey Show
Your Debt Should Make You Uncomfortable
That still feels like a- It's going to be a better growth rate. Yeah, absolutely. But yeah, how much do you make a year?
The Ramsey Show
Your Debt Should Make You Uncomfortable
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Your Debt Should Make You Uncomfortable
That's ramseysolutions.com store. Welcome back to The Ramsey Show. We have Katie on the line from Dallas from the last segment. And Katie was telling us she has $47,000 saved, $24,000 in debt, which was car and credit cards. And she was wondering initially when she called in about how to invest and how to pay off debt, not just let that money sit there because she wants to make progress.
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Your Debt Should Make You Uncomfortable
And as we kind of were digging into that, To the numbers in her situation, kind of unpacking the relational side of money. And marriage and money is so closely related. When you are married, working together with your spouse and being on the same team is a crucial part. But also we know on the other end, it's one of the leading causes of fights and tension and divorce and conflict.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And when you're not on the same page and when you live kind of separate lives financially. And as we were unpacking with Katie a little bit, that's what we've kind of started to discover is – where they are from a relational standpoint when it comes to their money katie is that a good overview would you change any of that or add anything
The Ramsey Show
Your Debt Should Make You Uncomfortable
Okay. I think you'll still qualify for a traditional Roth IRA at that range. So I would definitely be funding that. You can fund up to $7,000 and that. That might change in 2025. But I would do that 100%. And then I would probably just look at index funds or mutual funds beyond that. It's not retirement and you're not getting that match. But how much are they matching? What percentage?
The Ramsey Show
Your Debt Should Make You Uncomfortable
We unpacked it. Yeah, so before we were getting off the call, we just kind of asked, and I feel like it kind of struck some emotion in you of knowing that you guys don't work together, but yet he has a lot of debt, and you said it was just too much debt for you to even want to handle or to face. Is that right?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Okay. What other debt does he have? What's the credit cards and collections? What are those amount to? Do you know?
The Ramsey Show
Your Debt Should Make You Uncomfortable
And does he have any money saved in his name? No.
The Ramsey Show
Your Debt Should Make You Uncomfortable
So, OK, so, Katie, I think what this starts to open up and what you're feeling and correct me if I'm wrong, but it is touching every security insecurity part of your story and in your life. Like you've done everything you can to stock money away, even now.
The Ramsey Show
Your Debt Should Make You Uncomfortable
taking out credit cards and spending over here but just knowing the safety of money has been a lifeline for you and probably coming out of a lot of pain from your parents experience and you've done everything to safeguard yourself right um against i would say against debt but what's funny is you've taken on some debt right so there is still a level of risk there but you've patted yourself with the savings and it's kind of become your lifeline and you're gripping onto that and letting go of that is one of the scariest things for you to do would that be correct
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah. Which is very understandable, Katie. Very understandable. And so I want you to, as much as you can, because with money, emotions drive so much of this. And the more logical we can get, the safer I think you're going to feel with some of these decisions.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And one of the first steps I would do is sit down with him because I don't know his... I'm not on the phone with him and I can't ask him these questions. I don't know... Where he's at. If he is at a place, Katie, that he's like, I'm so overwhelmed. I'm so mad at myself. Right. He's probably not feeling great about himself. And it's like, I want to change. I want to turn this around.
The Ramsey Show
Your Debt Should Make You Uncomfortable
That's that's one scenario. A scenario would have a red flag and cause you to pump the brakes a little bit on all of this. If he's like, I don't care. I don't care, Katie. I'm going to do what I want. And we get those calls, too, with some guys that are like, well, he wants to buy the truck. He doesn't care. He's going to buy it. And we're you know, we can't make the payment, but he doesn't care.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Right. So like that is a character issue. If it's that, would you say it's kind of the first scenario or the second?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, but so he's more on that first scenario, you would say. He's all for it. Okay. Okay, so Katie, I want to encourage you that this is all good, right? I know you feel overwhelmed, and we're going to walk you through a very clear plan right now. So the first thing I want you to do is you guys together tonight – You can open a bottle of wine if you need, like, just a good sip of something.
The Ramsey Show
Your Debt Should Make You Uncomfortable
interesting way okay it's hard because it's free money coming from the company right but again your rate of return i just think that you could five percent is i think you could still i think yeah i think you'll end up better just doing it on your own versus putting money into this
The Ramsey Show
Your Debt Should Make You Uncomfortable
Order a pizza. Whatever you got to do to relax and say, okay, together, we're going to look at everything. We're getting out our pay stubs. We're going to know exactly, because when I asked you how much money you guys make a year, you said, I think around six. Like, I want you to know to the dollar, here's what we make combined. Here's every debt. We're going to write it out.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And we're going to know everything here. And we're going to, tonight, shake hands and say, we are now a team. Together, no longer are we roommates Venmo-ing each other for the mortgage. No, screw all of that. No, we are one. When our income hits our new checking account that we're going to open on Monday morning, when our income hits that account together, we are working as a team.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Because when you do that, Katie, not only from an emotional perspective, does it create so much unity and so much of a more beautiful marriage because you see yourselves as one, which is what you do when you choose to get married, to live life with another person. You're living that out on a tactical sense with your money. So that's such a beautiful part of it.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And then together tactically, as you start to trust each other in this, you're going to have this cleaned up, Katie. I would sell the boat immediately. But then by Monday, you guys can take this $47,000. And this is going to scare you, but I would pay off all, I would keep a thousand and, and you would have, you have, I think 42,000. If you, if you don't count the books, I want that sold.
The Ramsey Show
Your Debt Should Make You Uncomfortable
You're going to pay off everything else. Okay. And so you're going to have $5,000 left and you guys together are going to have a goal. I would say to save up probably, I don't know, 26, 27,000 for an emergency fund. And you're going to, that's your next goal together. Katie is to work to, to buff up that emergency fund. Okay. Yeah.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And that's going to take you guys, you know, maybe the next eight, nine months, ten months to do all of that for that emergency fund. But together, that's going to be your goal for 2025. Together doing this. Getting rid of the payments. We're done with payments. And now you're going to have your full income to be putting towards this emergency fund. $5,000 in this.
The Ramsey Show
Your Debt Should Make You Uncomfortable
That's scary. Is it scary because of what's going to be left? The $5,000 or it's scary that you're paying off his debt? That's scary.
The Ramsey Show
Your Debt Should Make You Uncomfortable
You have a lot of your income, Katie, leaving. And a lot of it's going to be coming back to you. And you'll be able to build this emergency fund up back very, very quickly. And then beyond that, you can start investing. Hold on. Stay on the line, Katie. And Emily's going to pick up. And we're going to put you guys through Financial Peace University.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, absolutely, Jay. Thanks for calling. Yeah, I would do that. But then definitely, you know, sitting down with a smart investor pro is always what we're going to recommend. I always hate giving blanket investing advice, you know, in a three minute call because there are some ins and outs and different employers are offering different things.
The Ramsey Show
Your Debt Should Make You Uncomfortable
It's our nine-lesson course and give you every dollar premium. So when you guys start looking at numbers today, you can start building out your first budget. Thanks for the call, Katie. We're cheering you guys on.
The Ramsey Show
Your Debt Should Make You Uncomfortable
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Your Debt Should Make You Uncomfortable
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The Ramsey Show
Your Debt Should Make You Uncomfortable
So again, give a gift that can create some change in people's lives that you love. All right, we're going to go to John in Midland, Texas. Hey, John, welcome to the show. Hi, guys. Thanks for taking my call. Absolutely. How can we help?
The Ramsey Show
Your Debt Should Make You Uncomfortable
I mean, the amount of changes that's occurred with retirement funds within companies in America, even over the last 10 years, you know, companies offering now Roth 401k is up by 20% versus what they were offering even five years ago.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yes, absolutely. Yeah, digging into that and looking at those numbers. But yeah. Yeah. So, yeah, I would get with the SmartVestor Pro J, double check all of that. But that's my knee-jerk reaction for sure is because when you look at all of these and the older people get, there are financial advisors out there that start to recommend more conservative funds. That's true. Like bonds and all of that.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah. I mean, you've done a fabulous job, John. I mean, it's incredible. I mean, yeah, I think that that's exactly right. And if you want to make it easy... and make it that automatic transfer to a money market account or a high-yield savings account to save for that down payment, I would say, yeah, absolutely. You know, there's always, you know, I don't feel this with you.
The Ramsey Show
Your Debt Should Make You Uncomfortable
That's why I just want to say it out loud, though. There is something when you're starting something new, you all that are listening and watching, And you're starting to build new habits. I do think being as hands on as possible and going through the motions is really important.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And so some people just want to automate it their whole life and be like, oh, I don't want to have to like feel anything. It's just going to happen. There is something about stepping in and saying, no, no, no, I'm going to transfer the money myself. So I'm practicing and seeing this happen.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And there's something about taking control in this discipline over your actions, which is a big part of winning with money long term. But John, I think you have some of these disciplines already in place. It's not like you're trying to change something big from your habits. It's more of a tactical change. And so doing something automatic at that point, I think is great, right?
The Ramsey Show
Your Debt Should Make You Uncomfortable
When you have stuff that just automatically comes out because you know, yeah, we're paying for electricity or paying for cable. Yes.
The Ramsey Show
Your Debt Should Make You Uncomfortable
and it's just coming and it's making my life easier in that way uh that's a benefit for sure and that would be the same with savings so if you do want to create an automatic you know transfer and and knowing that that high yield savings you can get to that money for some reason right if you lose the job or like whatever it is you know you can get to that money um but yeah but that's great john how old are you i'm 25 okay way to go and what do you do for a living
The Ramsey Show
Your Debt Should Make You Uncomfortable
Okay. Okay. That's great. I know it's always encouraging to talk to people in their, when they're young and in their twenties and you're making, yeah, I mean, incredible money doing it. So, and handling it really well. So that's, um, incredible, John. Good luck to you. I think that that's, yeah, that's amazing.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yes, for sure. Um, um all right let's see we got uh oh this is a fun instagram handle okay ready for this yeah jacuzzi 101 okay you like a good time at what point should my adults children's finances be none of my business oh i'm gonna go with at the point they're adults
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, this is always a tricky one because you hear,
The Ramsey Show
Your Debt Should Make You Uncomfortable
parents still wanting to be involved in their kids decision making and probably some of it out of a good heart right seeing kids maybe making mistakes or making decisions that you wouldn't make and you want to still be the parent in that way and intervene but I feel like the more life I've lived Jade the more successful relationships I see with parents and adult children happen when they start to become more peers yeah
The Ramsey Show
Your Debt Should Make You Uncomfortable
When you step into adulthood and your parents actually see you as a fellow adult and they're still not trying to parent you or lecture you and they see you as a peer, usually from the people that I've seen in my life that have great relationships with their parents, it's because of that.
The Ramsey Show
Your Debt Should Make You Uncomfortable
That's true. But still, I think even then, you know, it's advice you want to look at because I think on the flip side, when you're still in quote-unquote riskier, which is mutual funds aren't even that risky, you're still going to get a better rate of return. you know, I'm just never a fan of bonds is what I'm trying to say.
The Ramsey Show
Your Debt Should Make You Uncomfortable
There's kind of this mutual respect and the ones where there's usually tension when it's like, oh, God, my dad's still telling me how to load the truck or my dad, you know what I mean? Or my mom is still critiquing this or that or like, you know. Whatever it is, that's usually relationally when there's some tension. So I'd say none of your business.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And if they don't ask, not much you can do to change other people. You really can't. Really can't. Well, thanks to all the guys in the booth for making this a great hour. Jade, thank you as always.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Being a great co-host. Thanks to everyone out in the lobby at Ramsey Solutions. And thank you, America. We'll see you on the Ramsey Network app, podcast and YouTube. Make sure you guys download the app. So we'll see you next.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Even, even as you get older, I just don't think that it's worth like, yeah, the limited growth. So thanks again for the call, Jay. This is the Ramsey show.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Welcome back to The Ramsey Show. Today's Ramsey question of the day is brought to you by our sponsor, WhyRefi. When you're trapped in a maze of defaulted private student loan debt, it's hard to find your way out. But WhyRefi can offer you a lifeline with a custom refinancing based on your ability to pay and a lump sum payoff option that you could qualify for after 24 months.
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The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, no, no, no, no, no. Having guests pay for their plate at the wedding. No. Yeah. That's a hard pass. And it's different if it's like your birthday dinner and y'all are all going out to dinner, you know, to a big dinner and everyone covers their meal.
The Ramsey Show
Your Debt Should Make You Uncomfortable
But there is a an etiquette. I feel like when you invite someone to your wedding to celebrate you, their their presence is the gift, not them having to fund. Yeah. Fund it.
The Ramsey Show
Your Debt Should Make You Uncomfortable
You know, there's there are trends and we've talked about this. I think George Campbell and I debated this a little bit of people asking instead of a wedding gift to Venmo money to the bride and groom so that they can help pay for their honeymoon and like that kind of stuff.
The Ramsey Show
Your Debt Should Make You Uncomfortable
And if they want to do that, because some people, they will just give money for a wedding gift.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, and that's their choice, and that's great. But forcing people into a lane of how they're going to be generous to help you feels like, I don't know why, it just feels off to me.
The Ramsey Show
Your Debt Should Make You Uncomfortable
Okay, so you have extra money. I just want to make sure I'm understanding your question. And you're asking if you should be using it to cash flow college or do something else with it.
The Ramsey Show
Your Debt Should Make You Uncomfortable
No, because I'm a millennial and I still think it's... Okay. Yeah. Maybe it's the Gen Zers. Maybe they all think it's okay. I don't know. Maybe it is. I don't know. No more. I don't know. Eboo's a Gen Zer. Would you put a Venmo? Would you put a QR code? Yes or no? At your wedding reception. She says yes.
The Ramsey Show
Your Debt Should Make You Uncomfortable
All right. All right. Well, let's head to the phones. We have Hannah in St. George, Utah. Hey, Hannah. Welcome to the show. Hi. Thank you for taking my call. Absolutely. How can we help?
The Ramsey Show
Your Debt Should Make You Uncomfortable
Yeah, a good high yield savings account, Hannah, I would go ahead and open that and put your $1,000. And I wouldn't do right now the 10%. I mean, the 10% for giving, but we really, we don't talk about percentages for savings until maybe step four. That's right. And so this like, oh, we're gonna put 10% of our income for savings and do an emergency fund.
The Ramsey Show
Your Debt Should Make You Uncomfortable
I would put it all together and I would not worry about the percentage. I would find whatever money I had in my budget and get that $1,000 as quickly as possible. So you may be able to do it, depending on what you guys make and what your budget is, this month, right? And it may be 25% of your take-home pay, and it fills up your emergency fund that way.
The Ramsey Show
Your Debt Should Make You Uncomfortable
But I would not look at percentages for saving right now. I would get that $1,000 as quickly as possible. Then once you guys are completely debt-free, then you bump it up to three to six months of expenses using that same high-yield savings account. That $1,000 will then kind of be that springboard into...