Chapter 1: What financial issues does Lisa face with her debt?
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normal is broke and common sense is weird so we're here to help you transform your life from the ramsey network and the fair ones credit union studio this is the ramsey show i'm jade warshaw next to me rachel cruz taking calls about your life and your money uh for the next couple hours so if you want to you can get involved by calling 888-825-5225 in the meantime go to the phone lines where we have lisa who's in cincinnati ohio hey lisa hi thank you all so much for taking my question
So we have been served papers on an old debt that we now are having to either go to court and fight it or settle. And so we don't have the money for a lawyer. So we've been using chat AI to kind of guide us through. And so far it's worked like, you know, we've we've been able to. Um, prolong it a little bit. So, but now, you know, I need guidance.
I need real guidance on, on what to do and where to go. How long ago was this? Um, it's okay.
Okay.
Take a deep breath. That's okay. I'm sorry. I'm just nervous. And then it's just very emotional. Yeah. Stressful stress. Stress. Yeah. Yeah. Okay. So, um, the debt's from 2007 or we took the loan out in 2017 and then like around 2019, it's a sofa loan. They gave us 50 grand. It was great. We reconsolidated debt. It didn't work. Um, And so around 2019, I had a baby.
And then right around the corner of 2020, all of a sudden, I was home and had to quit my job. And so it was just my husband. And we were kind of like, we missed a couple of payments. But we would catch up. And then right around the corner of 2020, they just sold it off like it didn't matter. And so we've been fighting it ever since. They served us papers December 16th, I think, hoping.
Like, we only had 20 days to respond, and I think they were hoping that with the holidays we wouldn't be able to find a lawyer and we wouldn't know what to do. We just wouldn't respond. But we did.
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Chapter 2: How can Lisa navigate her old debt and legal challenges?
We got it together. We put it in chat. Chat gave us some information. We sent it. They sent us back discovery. Most of it redacted. And so... Our next – like, we were going to send another request for more discovery, but instead we just sent them a pro se if they would settle and save costs for $7,500. What company owns the debt right now? Do you know the name of it? Yeah, LVNV.
And what's the – LVNV? Yeah. Okay. So, Lisa, I need you to just – understand who you're dealing with, because I do think that always helps the stress level, okay? When bad debts, whether it's loans, credit cards, are sold, they sell them to a company, the company repackages them with other loans, sells it to another company, and it's been probably passed around, okay?
So you're dealing with someone who's sitting in a cubicle who's been on the job for probably three weeks and will probably end up leaving in two months because the turnover rate... with collectors is constant, it's constant, okay? So it feels scary and it's a big number, right? So we're gonna have to address it, but I do wanna take some of the stress off of who it is.
It's someone who honestly has probably the worst job on the planet, who is calling and serving people old debt, And again, the intimidation factor is so big, but the reality of it's not, Lisa. So we have to deal with it. So I'm not minimizing the situation.
But I do want you to just realize the person you're talking to or who even wrote the letter to serve it, it's probably not even going to be there in 60 days. It's going to go on to someone else. And then the company Envy or whatever.
L-N-V-E-N-V-Y. Okay, okay, there we go. Yeah, you know what, Lisa, I used to back in the day when the credit card companies used to call me and debt collectors used to call me, I used to just imagine that they probably had more debt than I did. Otherwise, they wouldn't be working there. And it made me feel a lot better. Like it just it made the whole thing a lot less intimidating. Yeah.
Have you offered so you have no money right now? Have you offered to do any sort of payment plan?
Um, so in the past, like the past couple of years, we did a payment plan for like, they'll do one for like 12 months. And then after that amount of time, they'll hit you back up and they want the whole amount. Sure.
So explain to us what's going on with your money now that... Over the course since 2017 and even 2020 on where we haven't been able to kind of stack together any money to make any sort of deal on this or keep the payment plans going. Tell us what's going on now. So now we're doing better.
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Chapter 3: What are the implications of investing in CDs?
We opened a joint checking account, and she has taken all the money, my pay, my social security every month, and gives me an allowance for food, gas, medication, et cetera. When the rent is due, she transfers that money, any kind of car repairs, insurance. She does an extra transfer. We have managed to save almost $200,000 during that time, which is remarkable.
Oh, my gosh. Well done. How much of that's yours, and how much is hers?
It's all mine, but it's all in her name. I don't have access to it. Okay, yeah. She doesn't send it. She sends me a screenshot. It's all still there. Good for you, Marie. Well done. But I want this arrangement to stop. I've asked her several times, and she's just not inclined to do so. She still doesn't trust me, understandable. But, you know, I would like to have...
My money available to me when I want it. And I don't know. One time I contacted an agency for elder abuse in my area and they told me to take her name off the account. Well, I didn't do that. I opened another account and had my money go there. She found out, she came, she was not very happy. We closed the account and transferred it back to the joint account.
What is her, when that happens, what is she telling you? Because there is a reason that this arrangement was made. What is it that she's afraid that you're going to do?
She's afraid that I'm going to get pulled back into that scenario and she does not want me to be penniless again, and I can understand it.
The scenario where you were scammed?
Yes. Are there things, Marie, that you want to do with your money right now that she's saying no to? Well, my lease had ended last March, and I wanted to buy a condo or a townhouse, and She wasn't on board with that. She said the only way that would happen if the property was going to be put in our name, which I didn't have a problem with that.
But it ended up I had to move to another place and I have a lease now with an apartment. So am I out of line to ask to be able to use my money or should I just suck it up and continue with our arrangement?
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Chapter 4: What strategies can Lisa use to settle her debt effectively?
2016-ish? Yeah. Yes, it happened. It started in 2015. So what I would do to probably keep the relationship good with your daughter, and again, I'm going to assume good in this call that she's doing this out of love and protection for you, is I would sit down with her and I would have a roadmap to say, hey... This is what I desire at the end of this road. I want full access to my money.
I want to be able to purchase a condo because rent keeps going up and up and up. And I want to be able to have a place to live that's modest, but that I own and whatever that looks like for you, Marie, what the end of it looks like. And then and then I would bring her in and just say, hey. what steps need to be taken for you to rebuild trust?
Because it sounds like you guys have just been functioning in this and she may have decided already, I'm just gonna do this till forever, for the rest of my mom's life.
I made that assumption.
So we wanna break that for you. and some milestones, have a couple of milestones. And in the next 12 months, what are things that you can be doing that would give her the confidence? Because that feels reasonable to me. And again, I'm assuming, Marie, this isn't, I'm saying all this, putting you in a good light that you're being responsible that you're not off to the side. You know what I mean?
I don't even have access to online banking. She... She sends me screenshots, and I keep a little book here. Yeah, so there's a point after 10 years, if there hasn't been other mistakes or other patterns, you should be moving forward. And for her sake, too, that she doesn't have to babysit you or, you know, roles reverse that she's your mom, right? For a season, I think that's really good.
But over time, you probably do want this deal to dissolve. But I would, again, try to do it with her. And, like, what's the roadmap to get there? Okay, okay. And then I hate to say it, but if she's unwilling to do any of that, I would be curious then her motivation at the end.
That's my question.
And I'd want to make sure that everything's above board. Yes, on both sides.
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Chapter 5: How can life insurance protect my family?
A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes.
Yeah, and that's why you've always said that having term life insurance from Zander is essential because it protects your family if the worst happens.
Yeah, that's right. You need 10 to 12 times your income in coverage. No gimmicks, no whole life junk, just straightforward term life protection. But there's another piece that people often overlook, and that's long-term disability insurance.
Chapter 6: What is the difference between life insurance and disability insurance?
Yeah, it's important to understand the difference between them. Life insurance steps in when you die. Disability insurance steps in while you're alive but can't work. So it replaces a large part of your income so the bills still get paid while you get back on your feet.
Now, if your employer gives you free disability insurance, great, take it. If it's discounted there at a better price, take it. But if not, Zander can help you find the right plan. Whether you're single or married, it's not optional. If you're going to be out of work for a while, then you need to make sure the money's still showing up.
And that's why Zander is our go-to. They make it super simple to get the right coverage at the best price, no pressure, no upselling.
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Protect yourself, protect your income, protect your family.
The truth is we wish that we could get to every call and every question here on The Ramsey Show. But we can't. I mean, there's a limited amount of time. We have segments and we go to commercial breaks. So if it ever seems like we cut you off, it's because you got to make that clock.
But if you do have a question and you want an answer for your situation, you can always head over to our website and use AskRamsey.com. Ask Ramsey is our free AI tool that's built and trained on proven Ramsey principles. And you'll get an answer that really is the Ramsey way. So you don't have to worry about it.
You know, if you go to, I don't know, like OpenAI, you could get a lot of things mixed in there. But if you go to Ask Ramsey, it will be Ramsey advice the way we would give it on the show. So ask your question today at RamseySolutions.com or just click the link in the description if you're listening on podcast or YouTube. Love that. All right.
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Chapter 7: How can I manage grief spending after a loss?
Next is Katie in Columbus, Ohio. Hi, Katie. How can we help today?
Hi, my name is Katie. I just wanted to say I recently got a two point six million dollar settlement and I just wanted to figure out what I should kind of do with the money. Oh, wow. I have a mortgage and I'm trying to figure out whether or not I should pay that off or not. Yeah. What was it from the settlement? Um, it's a lawsuit.
Is it like, but you're okay. There's nothing. Is there anything we should know about you going forward or you're all good?
I'm all good.
Okay.
So no ongoing medical issues or anything out of it? Nope.
Not yet.
Okay. Okay. Um, how much is your mortgage? My mortgage is 190,000. That's how much we have on the principal. And I'm at 2.75%.
Okay. Is, is it just you or do you have a family?
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Chapter 8: What steps can I take to pay off my mortgage faster?
I have a husband. I don't have any children.
Okay.
And my husband is a student right now and he's working on becoming an air traffic controller. Oh, how old are you guys? I am currently 30 and my husband is 31. Okay. And do you guys have any other consumer debt?
um let me see we have 105 from student loans for me um i'm a nurse and then my husband um he's gonna be about 150 total okay great and then but no car payments credit cards anything um cars is 25k for me and then my husband has he only has some 6k left on his okay credit cards No credit cards.
Okay. So my biggest question would be, before we get to the $2.6 million, let's pretend that $2.6 million, whatever happened to cause that to come your way, never happened. Were you already on the track to say, you know what, this debt is kind of crushing us. We need to do something about it. Had you already kind of been looking at that or kind of tell us how you arrived at calling the show?
Was it just the $2.6 million? Yeah.
Yeah, so, I mean, basically it's the 2.6, but in all reality, my husband, once he graduates from school, our plan was to immediately start attacking debt as much as we possibly could. Okay, great. I've been working 60 hours a week currently, and I make about $120K annually right now. Okay, okay.
Okay.
So as I just wanted to before we started saying you need to take this money and pay off the debt. I wanted to make sure like philosophically we aligned on the idea that debt is no moving forward.
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