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The Ramsey Show

It Takes Time To Build Trust (Hour 2)

30 May 2023

Transcription

Transcript generated automatically by AI and may contain errors.

Chapter 1: What is the main topic discussed in this episode?

36.532 - 60.215 Dr. John Deloney

Live, it's the Ramsey Show, where America hangs out to have a conversation about your money, your relationships, your marriage, your mental health, your work, everything. I'm Dr. John Deloney, joined here by my good friend, Jade Warshaw, and we are taking your calls on... Just about everything. We got an opinion on it. I promise you. 888-825-5225. And listen, I read the data.

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Chapter 2: How can I budget with an irregular income like commission?

60.756 - 79.485 Dr. John Deloney

I know your marriage is struggling. And I know you are looking at your kids who just got out of school and they already have a screen in hand and they're in front of another screen. and you're thinking, I don't want to do another summer like this, and you're looking at your budget, and you are not going to be able to make that vacation that you promised everybody, give us a call. 888-825-5225.

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79.766 - 86.634 Dr. John Deloney

We will help you navigate the wildness that is our lives these days, Jade. Most definitely.

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86.654 - 94.823 Jade Warshaw

It's mayhem. It is mayhem, but we'll walk you through it. We'll do the best we can. In the meantime, let's try to help Brady out. He's in Little Rock, Arkansas. What's going on, Brady?

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96.125 - 97.106 Brady (caller)

Hey, y'all. Thanks for having me.

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97.366 - 98.247 Jade Warshaw

Hey, what's going on?

98.935 - 106.331 Brady (caller)

So I work off of commission as a real estate agent, and I was just curious as to how I should build a budget off of that.

107.433 - 115.611 Jade Warshaw

So we're basically talking about an irregular income. How much do you fluctuate on a normal month-to-month basis?

115.878 - 131.524 Brady (caller)

Well, it actually fluctuates quite a bit because I live in a real small rural area. I mean, on average, the last two years I've made right at $50,000 both years. But, you know, one month I might make $15,000 and then next month I might not make anything.

131.504 - 147.925 Jade Warshaw

So I totally understand that my husband and I were in entertainment and it was very much like that. I call it feast and famine because one month you could like score big and have some great shows. And then the next month you're like asking your agent, like, where's the work? Where's the gig? So I totally get that.

Chapter 3: When should I consider selling my business?

231.929 - 243.225 Dr. John Deloney

That's perfect. I would keep that number at 50 and then divide that by 12. And that's your basis for how much it takes you to get through a month. OK, yeah, that makes sense.

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243.245 - 258.208 Jade Warshaw

And when you look back, you might start to see that there's a certain seasonality or certain trends that set up like, hey, it just seems like no matter what, for whatever reason, August, we always make more money or for whatever reason, you know, in December, we're just killing it. You're going to start to see those trends develop.

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258.248 - 265.68 Jade Warshaw

And that's also going to make it easier over time to budget and see what you've got. I also, you know, is your wife working now?

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266.386 - 273.96 Brady (caller)

No, ma'am. She is a stay at home mom. Stay at home mom. She does work. She works PRN as a registered nurse at a local clinic, but that's just one day a week.

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274.12 - 292.612 Jade Warshaw

So I'll be honest and take take from this what you want. But when I was in that situation of having such an irregular income for my husband and I, it gave us such peace to find a couple of things that we also did that gave us a stable, like no matter what, we know we're getting this money. And I don't know what that looks like for you.

292.652 - 305.129 Jade Warshaw

It might be something else that you do on the side where it's like, no matter what I know and I can always plan that I'm getting this two thousand dollars or I can always plan that I'm getting. Do you see what I'm saying? And I feel like that could go a long way.

305.149 - 318.708 Jade Warshaw

It doesn't have to be a large amount of money, but that goes a long way when it's paired with irregular income to give you just a little bit of peace of. I know I can count on this. And as long as I do X, Y, Z, I know we're good and I know we're gravy.

318.968 - 338.817 Jade Warshaw

But at the end of the day for you, a lot of this is being able to have the muscle to hold back and not spend and be like, okay, I know that we've got $10,000 sitting here, but this month we're only spending 4,000 and the other 6,000 has to wait until the next month or until you get another influx of cash.

338.797 - 357.909 Dr. John Deloney

I'm on 100% commission too. Let me tell you, there's not really a... You can do this any number of ways. Here's how we've done it in our house. Number one, the emergency fund is not this, what I would call a flex fund like Jade was talking about. Your emergency fund is in a separate account for when you've got to replace your roof or your air conditioner goes out.

Chapter 4: What inspiring stories can motivate my debt-free journey?

465.141 - 485.359 Jade Warshaw

So that's savings set number one. Number two, yes, put aside 25%, 30% of what you're getting because you know that you're going to have to pay taxes. And then three, as I said, if you have a big month coming, every time you have a big month coming and you know there's a lot of margin, let's set aside a little of that margin until you've got a little bit of a cushion so that –

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485.339 - 503.427 Jade Warshaw

you can start to live your life like a normal life, you know? So if you come in a couple of thousand short, you've got a piece that you can pull from, but it also lets you do the things that you need to do, depending on the baby step you're on, like investing or putting aside. Do you know what I'm saying? Cause you want to feel like you're able to do those things and you're not just waiting.

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503.467 - 508.815 Dr. John Deloney

The name of this game is discipline and it's just tough. It's just, that's the only difference is that she's got to be disciplined.

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508.795 - 536.31 Jade Warshaw

You do. It's not easy. Guys, living on irregular income, it is not for the faint of heart, but you can do it. It just takes a little bit of discipline and a little bit of really intentionality on your part, but you can do it. This is The Ramsey Show. Hey, what's going on, guys? This is The Ramsey Show. I'm your host, Jade Warshaw, joined by Dr. John Deloney. I love that.

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536.55 - 540.339 Jade Warshaw

I think it's cool when you have a doctor in front of your name. It just gives you the clout, man.

540.639 - 548.796 Dr. John Deloney

It sounds great until your friends get a hold of it. And it's not that great. And besides, when you get a doctorate, your name changes.

Chapter 5: How do I decide whether to keep or sell family land?

549.157 - 562.562 Dr. John Deloney

You go from John Deloney to Dr. Deloney. But in my house, my mom and my wife were Dr. Deloney before me. And so I've got these two gangster women ahead of me. And by the time I came around to it, they're like, oh, that's cute. Take out the trash. It didn't matter.

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562.542 - 576.435 Jade Warshaw

That's amazing. I love it. Well, give us a call. The number is 888-825-5225. And we will chop it up with you. In the meantime, we got Abigail who did just that. Abigail, what's going on? Toronto, Ontario, Canada.

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577.556 - 580.439 Abigail (caller)

Hi, this is very exciting. Thank you for taking my call.

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580.459 - 581.94 Jade Warshaw

Most definitely. How can we help?

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583.101 - 590.288 Abigail (caller)

So I'm thinking about selling my dog grooming business to my contractor because I'm burnt out and I really don't make enough money managing it.

590.892 - 602.506 Jade Warshaw

Wow. Interesting. So if you were to sell it, like, have you done the research? What are you know, what could you sell it for? Do you have a buyer? What would you do next? Those are my questions.

602.526 - 628.14 Abigail (caller)

Yeah. So I've searched out like a couple of lawyers or appraisal places, but they only really do like real estate. We don't have real estate. It would just be like my client list and my equipment and stuff. Uh-huh. And then I would be looking to sell it to my contractor. She works for me full time. She has a lot of health issues, which is why I'm feeling a little burnt out lately.

628.16 - 633.572 Abigail (caller)

I'm just having to do more work in the business, but still not making money.

633.772 - 659.357 Dr. John Deloney

enough on it so so let me it's funny you say that the first question that came to my head when you said you were burnt out with your business was are you truly done with this this part of your life right and and i've been there too or are you burned out by the the ecosystem you've created around this job here's my question if you fired this person

Chapter 6: What financial strategies work for those with fluctuating incomes?

754.425 - 756.687 Abigail (caller)

$12,000.

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757.108 - 760.211 Jade Warshaw

And how much of that did she see? Like what'd you pay yourself and what'd you pay her?

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761.732 - 763.894 Abigail (caller)

She made about $47,000 last year.

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765.035 - 774.912 Jade Warshaw

And what'd you make? $12,000. Wait, what? Hold on. It's your business. And I'm sorry, we're not laughing at you. We want to make sure we understand.

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775.112 - 780.037 Dr. John Deloney

No, I'm trying to think of what Dave Ramsey would do if I was like, hey man, I make 60% of this company.

780.638 - 782.079 Jade Warshaw

He says she's got it best.

782.82 - 784.462 Dr. John Deloney

Backwards, yes.

784.622 - 785.943 Jade Warshaw

Thank you. Say it right.

786.104 - 787.105 Dr. John Deloney

Yes.

Chapter 7: How can I manage my expenses when my income varies?

876.653 - 876.994 Jade Warshaw

So...

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877.7 - 883.254 Dr. John Deloney

So you're having to come in and do it. So it's not the money. You don't need the money per se. You just don't have the time. Is that right?

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883.294 - 902.204 Jade Warshaw

So why can't you hire another contractor? And that way you can keep earning off the business, but you don't have to pick up her slack. And then that 47K would just be split between two people. And then you're still making your 12K, which, hey, you're making money, whatever. If on your own words, it doesn't take a whole lot of work. It's just you managing from your house.

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902.605 - 921.696 Jade Warshaw

And then you've got another contractor that picks up the slack when old girl can't do it. Then now you're... now you're going. And now you've just got another business here that, like you said, you don't make a ton off of, but you're running it. And at any point, if you wanted to expand it and take a bigger portion of it, you could, unless you're just like, hey, I hate dogs.

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921.856 - 923.939 Jade Warshaw

I don't want to do this anymore. I'm out.

925.04 - 944.489 Abigail (caller)

That's definitely not it. I guess I feel like if I were to hire another contractor, I would be babysitting more. I trust this groomer and I I feel I can leave her when she is up and running, and I trust her with the money, and I trust her with the dogs and everything, and I feel like it would be more work for me.

944.87 - 953.766 Dr. John Deloney

Look, it for sure would be, but you'd make more money. It sounds like you do not want to be in the business of leadership.

954.146 - 954.367 Jade Warshaw

Yeah.

954.667 - 957.893 Dr. John Deloney

Because leadership's hard, and it's investing, and it's exhausting.

Chapter 8: What should I consider before selling inherited land?

1254.586 - 1278.502 Lori (guest)

Yeah, so we started the class. Maybe like two weeks later, our hot water heater went out. And then two weeks after that, he went on furlough. And we were like, oh, my gosh. We wanted to quit so bad. And I felt like just getting through that hurdle, those two hurdles alone, was enough to kind of just like propel us through. So it was like, okay, okay, it's going to be okay.

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1278.522 - 1283.85 Lori (guest)

We took an $1,100 hit like right off the bat. And then we're like, oh, my gosh.

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1283.83 - 1310.293 Jade Warshaw

can we do this every part of us wanted to go and just be like this doesn't work we're quitting we're giving up wow and we didn't we kept going well it probably also made you see like how precarious your situation can be right like all it takes is a water heater going out or being furloughed for you know just the dominoes to fall all over the place yeah people think they get a job in the government it's going to be stable and slow forever until it's just one Tuesday afternoon it's just not anymore right yeah

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1310.273 - 1316.252 Jade Warshaw

Yes. So $153,000 over the course of $53,000. What was your income during that time?

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1316.512 - 1318.338 Clint (guest)

It was $120,000 to $150,000.

1318.719 - 1322.511 Jade Warshaw

Wow. And what accounts for that increase?

1322.862 - 1325.124 Clint (guest)

Just pay raises over the years.

1325.745 - 1326.766 Jade Warshaw

Pay raises over the years.

1327.386 - 1327.586 Dr. John Deloney

Yeah.

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