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Chapter 1: What is the main topic discussed in this episode?
Live from the headquarters of Ramsey Solutions, broadcasting from the pods moving and storage studios, it's the Ramsey Show, where we help people build wealth, do work, that they love and create actual amazing relationships. Open phones at 888-825-5225. Rachel Cruz, Ramsey personality, number one bestselling author and co-host of the Smart Money Happy Hour podcast on the Ramsey Networks.
Be sure and check it out as my co-host today. Also, my daughter. Open phones at 888-825-5225. Jason is in Boise. Hi, Jason. Welcome to the Ramsey Show.
Hi, Rachel. Hi, Dave. How are you?
Better than we deserve, sir. How can we help?
Good. I was wondering if you could settle kind of a disagreement. My wife and I have been gazelle intense for about five years now, but I have a mortgage still in a home equity line of credit we need to pay off, and I want to attack the home equity line of credit because it's freaking me out because of the interest. It's not a fixed interest rate.
And my mortgage is a fixed interest rate at like $2.75, and we've got that paid down to about $30,000 right now. What do you owe on the home equity line? $180,000. Good Lord. I know. Yeah, we bought a home about... What's your household income?
About $90,000. You need to refinance and get you a new first mortgage.
Okay. That was my next question. I want to pay off the home mortgage refinance and then get it locked in.
Yeah, I hate to lose the 2%, but it's only on $30,000 of $210,000, so mathematically it doesn't come out to be much. And you get rid of the massive mess on the other side, put it on a 15-year fixed, and then that becomes a baby step six, and you can chill and start working your baby steps four, five, six, because I assume you have your emergency fund done. We do.
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Chapter 2: What should you do when you and your spouse disagree on paying off debt?
Do we want to be running this business, or do we need to make some changes so that we want to keep running the business, or do we want to sell the business? Any of those are fine. There's no wrong answer there. I would not tell you, you need to sell that to get rid of the stupid home equity loan. No, that's not a statement you're going to get here.
I'm sorry your wife won the argument, but you need to get a new mortgage and pay off the home equity loan, okay?
okay call churchill mortgage they'll help you get that refinanced and um the two percent is horrible to get rid of but again it's a very small amount of your loan and the big amount of your loan is an angry monster loan and it's going to eat you don't let it do that and he could feel it couldn't he oh yeah you feel like this thing's bad his wife can feel it for sure.
I wouldn't. Yeah. Yeah. Make it consistent. Know what you're getting predictable. And you guys just put in baby step six.
Yeah.
That's great.
There is a, There's a good part of money that you should attempt to approach boring. You want to have a boring, automatic kind of thing going on with your money. And so if your money is super exciting all the time, that probably means you're taking a lot of risk and there's a lot of chaos going on. And so generally speaking, the people, and I don't mind the excitement.
I'm an entrepreneurial type. But just from a process standpoint, you should be pretty calm. The data tells us that the calm, steady people are the ones that have more money.
Yeah.
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Chapter 3: Is it acceptable to spend money on family gatherings while in Baby Step 2?
And that is at, if you want to sign up for hers, that's going to be the 15th of August.
Yeah, these are these are really great, too, because there's a lot of Q&A. It's a lot of interactive. And if you feel like you're alone in the stress of budgeting or even the idea of, oh, my gosh, how do I even start this? I just I feel overwhelmed with my money. That's how majority of people feel. So you are normal.
And this is a place and a space that we're creating for you guys just to come in and ask your questions and talk through, hey, how do you. take this emotional thing that is really difficult and actually put something into practice that you can have. And honestly, even with the app like EveryDollar, use every day to help you in control of your money.
First time you drove a car, it was awkward. First time you do a budget, it's awkward. I don't care if you've got a PhD in finance. Learning to do a budget is awkward. It feels weird. It's a new skill, and it takes a little bit. So Rachel's webinar on the 15th will be at everydollar.com slash webinar if you want to sign up for that.
So, slash budgeting for Jade's on the 9th, slash webinar for Rachel on the 15th. And we'll be having one with George sometime after that. We'll let you know, of course. So, the three Ramsey personalities that deal with money other than me are going to be doing these every dollar budgeting webinars for a couple of weeks here to try to get you guys started going into the fall.
Kids are going back to school. It's time to get your crap together now, people. Yep. Time to get lined up and we'll show you how to do it.
It feels good. Can I say that as a mom with the kids going back to school? Like one time we're working out, we're eating better now. Kids are on a schedule. You just get back in a routine after the summer fog and so this is the time to do it. Things are shaping up in your life and the schedules, it's a real thing.
So make money part of that too in this part of the year because it's a great, it's the second new year. We call it all the time.
Absolutely. All right, Paul is in Springfield. Hey, Paul, welcome to the Ramsey Show.
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Chapter 4: How important is it to identify the reality of your financial situation when in debt?
book who's a real estate several hundred million dollars worth but I pay cash for it and I don't have any debt and it all cash flows like a Bandit and I don't have any of it that causes me super stress because of that so You know, but that's that's how I live and my life is great because of that So I would tell you to invest in things you understand and you're comfortable with Obviously real estate is that
People who like real estate often take on a whole lot more debt than I think they should.
Right. So, yeah, like I haven't been buying for cash per se. And if I do buy for cash, it's because it's a foreclosure. You know, I'm going to renovate it. And the goal is obviously to buy it at the right price point and not overinvest. And then refinance it, putting 20% down and using the passive income of the rents to pay myself back, or I have enough equity.
Let me stop you for a second. There is no passive income from rents. If you've been dealing with renters, you've figured out it ain't passive.
Well, yeah, it depends on how good you are at screening.
It's not passive.
It's never a perfect sign.
No, it's not passive. I've been doing it for 40 years. Dealing with renters, commercial or residential, is not passive. That's TikTok mythology, okay? The term is coined passive. No, the real world is it's active. You're active. Real estate has the highest hassle factor of just about any investment you do, but it has one of the higher returns.
So, anyway, you called to ask what I think you should do. I think you should use this fabulous income to clear off all this stupid debt you've got on this real estate, and you're going to have a much higher trajectory in your wealth growth long term. Short term, it's going to slow you down.
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Chapter 5: What are the best ways to build wealth according to Dave Ramsey?
Or the time I argued with Oprah. That might have been when I peaked. Yeah, that was back when I peaked, yeah. Hey, Dr. John Deloney has a brand new book coming out. He has not peaked. He is a skyrocket shooting to the moon, baby. I'm just saying. And this book is selling like crazy. Man, what a success. Thank you, guys. We appreciate your response to this. It is a fabulous book.
It's called Building. A non-anxious life. The six daily choices that you make to get anxiety lowered because anxiety is telling you something else is wrong. So you fix the six things that are wrong, the anxiety goes down. Just like that. And so very tough to do. But really good book. It actually pubs October 3rd, but it's in pre-sale right now.
And a whole bunch of you have taken advantage of the deal where we're selling the book for $20 and throwing in $75 worth of goodies. We're bribing you to buy it early because it helps us with the marketing because all the sales up until pub day count the first week towards the bestseller list. So thank you. It helps us. And we appreciate that. We appreciate you guys stepping up and getting this.
Instant access to his newest talk, Smoke, Fire, and Freedom. You also get the e-book, the audio book, all of this, and the book itself for $75. We'll ship it all to you except the talk, which comes now.
They're not for $75.
Do what?
Not for $75.
I'm sorry. It's $75 worth of stuff for $20. Yes, $20. That's the deal. Serious deal, really. I mean, the paper cost has gone up 40% this year, people.
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Chapter 6: Why is borrowing against your car to invest a bad idea?
Hello. So anyway, and we still got the book at $20. So RamseySolutions.com. You can pre-order the new book. Man, anxiety. You got to get rid of it. Building a non-anxious life. So good. Tyler. Tyler's with us. Tyler's in Tampa, Florida. Hi, Tyler. Welcome to the Ramsey Show.
Hi, Dave. Thank you for taking my call. It's an honor to speak with you.
You too.
What's up? So I have a question. My wife and I have been paying off debt for about the last year and a half now. We've been able to pay off about $60,000 out of $100,000. And I actually didn't know about the baby steps until about six months ago. So in the beginning, we were kind of Dave-ish, I guess you could say. And now we're Trying to get a little more gazelle intense with it.
We've been doing pretty well with following a budget. And I just am struggling with certain expenses related to like family events. I don't get together with my family very often. We have a wedding coming up that we're going to. Uh, and then I just found out from my sister that, um, for her 40th birthday, she wants us to fly out to California and, um, spend a weekend with her at a resort.
And, uh, it's going to, it's going to cost us a little over a thousand dollars for me to go do that. Um, I'm having a hard time deciding whether or not that's a good way to go. We have, I have just my student loans left to pay off about 40,000. Um, and I was really hoping to knock that out. We've been able to increase our income.
Um, so I've been hoping to be able to do that in the next few months and I'm just not sure whether or not that's a good idea. And I thought I'd get your advice.
Yeah. I mean, Tyler, the, I mean, the reality is we always say that the deeper you sacrifice, the more money that's spent, the debt, obviously the faster it's going to be paid off, but life is going to be intertwined throughout that. And that's when you and your wife have to kind of make the call yourselves and to say, okay, well,
what are things going on that we feel like we want to be a part of with our family? What are things that we feel like, gosh, we do, but then we also are like, we could do something else at a later date because we want this mess cleaned up.
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