The Ramsey Show
You Have to Know Where You Are Financially to Know Where You're Going
Fri, 28 Feb 2025
πΒ Are you on track with the Baby Steps? Get a Free Personalized Plan Ken Coleman & George Kamel answer your questions and discuss: "My husband is calling me a hypocrite" "I owe my dad 50k for medical expenses" "Am I responsible for my parents' debt?" "Am I good at day trading?" "How can I teach my kids about money?". Support Our Sponsors: π± Get 10% off your first month of BetterHelp β Get 10% off Byrna product bundles and more! π₯ Learn more about Christian Healthcare Ministries π‘ Get started today with Churchill Mortgage π Get 20% off when you join DeleteMe π¦ Go to FAIRWINDS Credit Union for an exclusive account bundle! π₯ Save 15% on your first Field of Greens order with code RAMSEY β¨ Find top Health Insurance Plans at Health Trust Financial πΈ To find out more about student loan refinancing, check out Laurel Road π» Visit NetSuite today to learn more ποΈ Use promo code RAMSEY for 18% off at The Nokbox π΅ Learn more about Timothy Plan π Get started with YRefy or call 844-2-RAMSEY π Visit Zander Insurance for your free instant quote today! Next Steps π±Β Watch the full episode for free in the Ramsey Network app. π Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! π Preorder Build a business You Love today. π΅ Start your free budget today. Download the EveryDollar app! ποΈ Get tickets to Investing Essentials and learn to invest with confidence. πͺ Check out Front Row Seat with Ken Coleman! ο»ΏποΈ Get Tickets to the Money & Relationships Tour Listen to more from Ramsey Network ποΈ The Ramsey Show Β π§ The Dr. John Delony Show πΈ Smart Money Happy Hour π‘ The Rachel Cruze Show πΈ The Ramsey Show Highlights π° George Kamel πͺ Front Row Seat with Ken Coleman π EntreLeadership Learn more about your ad choices.Β https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy
Chapter 1: How can the Baby Steps guide my financial journey?
This is The Ramsey Show, where we help you win in your life, specifically with your money, in your profession, and in your relationships. Alongside the incomparable, the delightful George Camel, I'm Ken Coleman. Excited to be with you all. George, you ready to go today? It's a Friday. You're not mailing it in. No. I don't even know how to do that. I'm a millennial. Come on. I don't mail anything.
There you go. That's a very good point. You don't even know what a stamp is. I'll explain that to him during the commercial break, but we're here for you, America. 888-825-5225. 888-825-5225. Now, we're going to coach you on saving your money, investing your money, making more money. That's what George and I do together, and I warn you ahead of time, we have fun.
uh this is serious stuff but we also have fun while we're doing gotta bring some levity to it yeah or else we get bored and uh we don't want that by the way great looking studio audience today here uh on the other side of the glass so we'd love to see you sometime if you want to come join and watch the show live we'd love to see you all right let's get started 888-825-5225 again is the phone number rob starts us off in hartford connecticut bob oh excuse me rob uh how can we help today
Hi, George. Hi, Ken. Thanks for taking my call. Sure. What's up? So I got married about six months ago, and I'm trying to dig us out of this ginormous hole of our prior divorces, some poor decisions, and a severe case of can't-say-no-to-wife-itis.
Hold on a second. Hold on. What was that? A severe case of what? Can't-say-no-to-wife-itis. Ha! Wow. I liked it. I thought that deserved, you ran through that too quick. Can't say no to wife-itis. Yeah. I've got a similar case. It's called can't say no to daughter-itis. My 16-year-old's got me wrapped around her finger. I really struggle. I don't think insurance covers those. Sorry, guys.
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Chapter 2: Should I consider a HELOC to manage high-interest debt?
It doesn't.
Yeah. No, unfortunately.
It's a pre-existing condition.
So, but yeah, so long story short, We're probably about 250K in the hole right now, not including the house. Part of that is, like I said, divorces hit both of us pretty hard. I also got in a car accident in December and then lost my job the next day. So I had like three or four months span that was really tough on us.
Um, but I am trying to, you know, we, we make decent income, so we have enough, we have a little bit of margin. So I'm starting obviously baby step two, um, trying to get going on that. But the thing that kills me is I understand the concept of the smallest, the largest, but the problem is almost all of our small debts are all 0%. And we have large debts that are 28%.
And it drives me nuts that I'm going to spend 12 months paying off $15,000, $20,000 worth of 0% while the 30% is accruing $1,000 a month in interest. And I was thinking, you know, we can take a HELOC, cut that rate by 70%. It adds another $800 to $1,000 that we can roll into the snowball and get done, you know, eight months to a year faster.
Rob, you are rearranging the chairs on the Titanic, my friend. This is not going to be the solution you're looking for. And I know you can crunch the numbers and see how much you're paying in interest, and that should make you angry. But here's the deal.
The people that actually get out of debt, they don't just move around their debts and get new debts to cover the old debts and pay off the big debt. They just do the debt snowball and get so frustrated and so angry that they're willing to work as much as it takes to get rid of the next debt and get rid of the next debt, freeing up the next payment.
And you're going to lose all of that momentum trying to tackle this giant mountain of the biggest debts with the biggest interest rate. So the question is, what are you willing to do and sacrifice to use your savings and future income to get out of this? Are there stuff we can sell on this $250K? Are there cars involved?
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Chapter 3: Is it worth going back to school for a higher salary?
Yeah, I'm looking at getting another job to try and bring in some more income to tackle this.
Now, you kept saying, I'm going to start the debt snowball. Where is your wife in all of this?
She's there. She is in the other room.
Is she a willing participant in this process?
She's in the other room.
Or is she like, hey, knock yourself out trying to get rid of this debt. I'm going to go over here buying stuff.
Yes. She's actually volunteered to get a second job as well. But she did that before with her ex-husband who had no ambition at all. So I don't really want her to have to do that again.
Well, why? You're projecting something. If she's willing to get a second job, the answer is thanks, babe. That's awesome. What are you, the knight in shining armor for the last deadbeat? You guys got to work together on this.
Yeah, her last marriage was not crushed because of her second job. It was crushed because of a lot of other reasons and a lack of unity. And what this shows me is that you are actually creating unity because both of you have skin in the game and you're walking through this together.
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Chapter 4: How should young couples prioritize marriage and home-buying?
I understand that. I wasn't really saying I'm going to switch to paying off the highest one because I know that doesn't work. I know what you said.
You said you wanted to do the HELOC for it. We get it. But we're just trying to help you get some momentum. The momentum is the issue. Dave has proven this for decades through people who followed it. It is about momentum. That's what we're trying to help you understand. George?
Yeah, behavior is what got us here, not interest rates, not math. And so I know the interest rate is the easiest thing to get mad at instead of looking in the mirror and being mad at Rob. And, man, you are dealt some cards that nobody should be dealt with. But here we are on the other side, and the only way out is through it. And that's the debt snowball method. So hang on the line.
I'm going to send you guys my book, Breaking Free from Broke, along with Financial Peace University. You and your wife sit down, watch all the lessons, listen to the audio book, read the book, get fired up, get five jobs. And if your marriage isn't better at the end of this thing, then we've done our jobs wrong. Because I'm telling you, that's the kind of unity that the debt snowball creates.
Yeah. All right. Quick break. I'm going to try on George's bomber jacket, see if it fits. And we'll be back. This is The Ramsey Show.
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Welcome back to The Ramsey Show. Alongside George Camel, I'm Ken Coleman. Thrilled to have you with us, 888-825-5225, 888-825-5225. Let's go to Salt Lake City, Utah, and Sean is joining us there. Sean, how can we help today?
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Chapter 5: What are the emotional implications of a prenup?
And I've been crunching the numbers, Sean, and based on just some quick research, entry-level PA in your area probably make a 90 grand, which is what you said you'd make just getting off the road. Now, long-term, you could make closer to 110, 130, but this is not a significant jump to go 125 grand into debt or to even cash flow. Well, he's actually going to go backwards from where he is now.
Exactly. So I would, to Ken's point, be very patient about this and just stack up cash and live like you're a broke college student right now. Because if you can put away, you know, 40 grand a year, in two years, this thing's cash flowed. And then two years from that, you're a PA.
And let's play time. That's right. Sean, let's play this out. You do what George just said. You're only two years of patience there. And then now you're stacking cash for the house.
That's true. And I also saw in-state costs. For example, University of Utah, in-state costs should be closer to like $82,000 for this program. So where was the $125,000? Was that a specific university you were wanting to go to?
That's a specific university just because my degrees are old and there's not very many places I will accept my credits since they're so old.
Have you checked all around? Have you went to the most affordable options and went, will you take my credits? Can I get into this program? I feel like there's some more homework to be done. Yeah, I've checked quite...
Yeah, I've checked quite extensively, and I have two bachelor degrees previously. They're just, my credits are so old, so if I applied to, like, say, Salt Lake, I'd have to take numerous classes over again, like chemistry, ochem.
And you couldn't clap out of them?
Et cetera.
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Chapter 6: Is moving for a job opportunity a good idea while in debt?
A lot of people I work with.
I've never met a 23-year-old who's about to get married who's like, yeah, we're ready to buy a house, buy a ring, get the wedding, and do it all in cash. Here's what most people do. They go, we'll finance it, and we'll start our marriage off in crippling debt and hope for the best. Yeah. That's normal.
And so I want you to be weird, Scott, and that means, hey, maybe a newlywed couple can just rent for a year or two or three, get their bearings underneath them, and get a good down payment under their feet before going, well, we're married, got to have a nice house, got to have a nice car.
Yeah.
So I would focus on one thing at a time. Next up is the ring. We're going to do a reasonable ring, one month salary max. I don't care how wonderful she is. It's not about the ring she deserves. It's about the one you can afford. Next, let's make sure we can cash flow this wedding between family and ourselves. Next, let's talk about the honeymoon.
All right, I'm going to pay for a reasonable honeymoon. Next, we can talk about emergency funds and down payments and all that good stuff. So hang on the line. I'm going to send you Financial Peace University. This is the roadmap for any newlywed couple. If you guys get aligned on this, it will bode very well for the success of your future marriage.
That's good, George.
One thing at a time. That's it. Very simple. So we're such in a rush at 23. Yeah. Wow. Got a lot of life ahead of him. As can Scott. He's much older. So much older.
And by the way, the young thing, I got married at 23. This is, you know, too young. All right, we've got to take a break. During the break, I'm going to share with George what I've learned about bread. This is The Ramsey Show.
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