Chapter 1: What is discussed at the start of this section?
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Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broke and common sense is weird, so we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union studio, this is The Ramsey Show. George Campbell, number one best-selling author, Ramsey personality, co-host of Smart Money Happy Hour here on the Ramsey Network is my co-host today.
The phone number is 888-825-5225. You jump in. We'll talk about your life and your money. Betty is in Washington, D.C. Hi, Betty. How are you?
I'm hanging in there. I can't believe I'm actually talking to you.
Well, I'm honored. How can we help you today?
Well, I'm going to apologize up front in case I cry because this has been a really stressful situation. But long story short, my husband and I have a house that we cannot afford. Our mortgage payment is over $6,000 a month, and it's been listed for over two months now. And the house is just not selling. Um, and we got, we got a report back from our Ramsey trusted real estate agents last night.
Um, that's not very good. And so we're looking at either having to drop the price again and try to find $30,000 while we're in babysit to, to be able to pay, to get out of this house that we can't afford. Um, And the other options that they gave us really were to potentially look at a short sale or a deed in lieu or something like that.
And those options aren't on the table because my husband will lose his job if we go that route. And I don't know what to do.
Okay. So what is your household income?
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Chapter 2: How do we handle financial stress in a family?
That's what the $30,000 is, is that you're afraid you'll have to sell it for less than or you'll net less than you owe, right?
Correct, sir. Okay. All right. What did the report say? You said you got a bad report from the real estate pro. Yeah, just that if we didn't lower the price, they thought that we had less than a 10% likely success rate of being able to sell it. We've been in the house for just under two years.
Chapter 3: What options are available for selling a house we can't afford?
We originally purchased it. It was supposed to be with my parents. We were supposed to split it. And as soon as we closed before the first mortgage payment came, my dad went back on his word and said he had never agreed to split it 50% with us, which was what we were all under the impression would happen.
Is he on the mortgage?
No, he is not.
And not on the ownership either?
No.
Okay. All right. Well, here's the thing. The great news is that with bonuses and finding extra work, both of which could be easily in your future, you've been able to hang on and reduce debt by $30,000. That's fairly impressive, really. And so if we can add the bonuses and the income from you, and I think you can, back to the equation, even if you stop your debt snowball...
temporarily and start piling up cash to write a check and get out of this house, you can make that. That's going to work. You're going to be able to do that. You're not trapped. You're just in a really sucky temporary situation. But, you know, 10 years from now, this will be in the rearview mirror and you'll be going, oh, that's a dumb thing I did.
My dad lied and I wouldn't have done it without that. And dadgum, what a horrible mess we got in just about the time the baby was born. About the time Rachel was that age, by the way, I filed bankruptcy. So there you go. I mean, and I'm OK now, you know, so you're going to be OK is my point. But right now, the snapshot that we take has got tears in it. And that's valid. OK, the snapshot is this.
I can't breathe. But the film strip says there's an end to the movie. That's not the end of the world. The rainbow comes out. So, yeah, so I would say stop your debt snowball temporarily and just start piling up cash. Because as soon as you start seeing options, your anxiety level is going to go down.
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Chapter 4: How can we effectively manage debt while supporting family?
And while pile up $30,000 and get ready to do what the real estate agent said, let's write a check and get rid of this hellhole. It's driving us nuts, right?
Have you guys actually done a budget to see where this other $6,000 is going in your take-home pay? Because you might find some $1,000 or $2,000 right there. Yeah, we have. We've actually been pretty locked in since July, which I'm thankful for.
But generally speaking, with the work that we had to do to prepare the house for sale and everything, I think we're able to put aside about $1,000 to $1,200.
a month right now to go and and then you add your income that you're going to get and you add his bonus and you start selling stuff because the house is going to get sold anyways might as well clear some rooms out make some money off facebook marketplace and all that can help if you get creative and again i take the pressure off yourself to get rid of the 45 000 unless it's a 45 000 car if it is sell it and be done with it but um but i mean personal i
But I think the proper perspective on this will give you some of your fight back and get the tears back, push the tears back from the edge a little bit and go, oh, yeah, we can do this. This is actually doable. I think you can. But I think the next 12 months are not going to be fun.
Um, and you get rid of the house, you've got $30,000 and then you go knock out the 45 and you know, you learn a whole bunch of lessons in this short period of time about the time the baby was born. And you'll look back on that 20 years later and baby's 27 and you'll go, man, when you were born, our life sucked. And the baby will go, I don't remember that. Yeah. I don't remember that.
What's for dinner. I don't remember that. Statistics show that half of Americans don't have enough life insurance or they don't have any at all. I don't understand this, John. Why don't people want to take care of their family? They think they're going to die or something?
Well, I used to be one of those guys. I didn't even think about it. And one of my buddies said, hey, the only reason to not have life insurance is if you hate your wife and kids. And I immediately went and got term life insurance. That's a gut punch. And you're telling me and for decades, Dave, I've sat across people who've lost a spouse. They've lost somebody important to them. Me too.
They don't know what to do next. Me too.
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Chapter 5: What financial advice is given to someone living paycheck-to-paycheck?
So my favorite was how much did my boyfriend spend on an engagement ring? And he's there. And he's there. So we bring him up to say, hey, you tell me, bud. And so that got into some juicy debates. That's a good one. So if you want to go watch it, it's live on our Ramsey Show YouTube channel, Spotify, Ramsey Network app. Go check it out.
It's like nothing you've seen before on this show with a live audience like that.
That's fun.
Chapter 6: How can someone negotiate their salary in a family business?
Very fun. Yeah. We've got four cities. Denver. Charlotte's already up. Denver will be up this week, and then you'll see Phoenix and Anaheim come on in the next few weeks. You don't want to miss these. Every one of the Ramsey personalities had a blast being out there with you folks. So thank you all for showing up. We appreciate you.
Chapter 7: What steps should be taken to help a parent with retirement savings?
John is in Nashville. Hey, John, what's up? Hey, Dave.
Thanks for taking my call. I am 23, and I am debt-free. When I first graduated, I took out a truck loan and all that, and I got it all figured out. So right now I have no debt. I got about $35,000 saved up and trying to figure out what I should do next.
Wow, that's impressive. Good job.
Chapter 8: How can one effectively address debt while planning for a family?
What do you make?
I make about $60,000 a year, and I work for a family business, and that's part of my issue is coming up with that. What's the issue? So at first it was me, Mom, and Dad in the restaurant every day, and everything was going great. And it seemed like more of the responsibilities were getting pushed my way, and now it's me in there every day, and mom and dad don't really work anymore.
And he gave me a business card that said I'm owner-operator, but I'm making about $20 an hour. and uh my mom you know i don't i don't want them to work all the time but you know mom's working no days a week and that'll work you know one day a week and they own it that stuff they own it right so it's a formality that it says you're not an owner operator
Right. You're an employee.
But I have business cards that say I am.
I don't care. That's of no value whatsoever. Okay. Well, I mean, could you get a job at another restaurant if you were the general manager of another restaurant and you were responsible for the operations? What would you make?
Well, I'm not exactly sure. I applied for Bucky's in Murfreesboro. I applied to be the assistant manager up there, and it does pretty good. Uh, what does that pay? I hadn't, I don't, it pays 33 plus, uh, benefits and retirement. See right now I'm a 10 90. So here's my issue. So he kicked me out of the house. Understandable. I'm 23, you know, it's about time.
And so I came and got an apartment and I started looking at one day getting my own home and I'm a 10 99 employee.
No, you're not. And, uh, You're not supposed to be. Oh, I'm not? Yeah, y'all are screwing that up. You're going to make a mess. You're not an employee. I mean, you're not a 1099. 1099 is an independent subcontractor. You're an employee. They're going to get their butt fined by the IRS. Big time. You guys are going to end up with tax penalties and all kinds of stuff.
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