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The Ramsey Show

These 3 Things Will Keep You Broke

21 Aug 2023

Transcription

Transcript generated automatically by AI and may contain errors.

Chapter 1: What financial questions are addressed at the beginning of this episode?

27.723 - 55.903 Dave Ramsey

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. George Campbell, Ramsey Personality, co-host of the Smart Money Happy Hour with Rachel Cruz, a production of Ramsey Networks, is my co-host today. We're glad you're here.

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55.923 - 72.043 Dave Ramsey

We're here to answer your life and your money questions. Phone number is 888-825-5225. That's 888-825-5225. Cecilia is in Atlanta to start off this hour. Hi, Cecilia. How are you?

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73.365 - 73.946

Hey, Dave. I'm great.

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74.627 - 75.668 Dave Ramsey

Thanks. Good. How can we help?

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77.217 - 94.135

So I'm interested in whether or not I should leverage equity lines for more property when I've tried to not have debt. And is that safe for investment property activity?

96.477 - 99.84 Dave Ramsey

Okay, you realize your sentences just ran against each other, right?

100.601 - 101.923

That's possible.

101.943 - 104.305 Dave Ramsey

I don't want any debt. Should I go into debt?

105.078 - 105.378

No.

Chapter 2: How should I approach leveraging equity for real estate investment?

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No, you're the person to answer this question.

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386.75 - 391.517 George Campbell

I'm curious, what is driving you toward this? Are you not great financially?

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No, I took a little course called Financial Peace University, and I got debt-free, paid off my mortgage, paid off my children's student loans with my husband.

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405.092 - 408.882 Dave Ramsey

What's making you, just all the people doing it that are wanting you to do this?

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No, I'm trying. I have very much ignored all that clamor. So I did want to diversify my portfolio.

418.46 - 422.985 Dave Ramsey

Until you asked me a question about leveraging lines of credit to go buy real estate, you ignored it.

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Well, that's why I'm talking to you is because I haven't done anything foolish. I know, I know, but I'm just saying.

432.455 - 439.092 Dave Ramsey

What was it that made you think that that was even a good idea? That's what George is asking.

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Well, I guess my question was, had something changed in the world's financial picture at all? No, nothing changes. This is a way to get around stuff. You know, my my dad lived some of what you're talking about as well. He bought, you know, land he couldn't afford and hope to hold on to it thinking it's going to.

Chapter 3: What are the dangers of leveraging debt in real estate?

674.383 - 698.521 Dave Ramsey

And I have done all three, and all three will make you broke. Greed, fear, and pride. See, pride is I buy a car to impress someone at a stoplight that I will never meet. It's like a Christmas vacation, good-looking girl waving at Chevy Chase, and he wrecks his whole family's car, right? It's that. That's your deal. You remember that scene?

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698.541 - 699.344 George Campbell

Oh, that's such a great scene.

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699.364 - 720.305 Dave Ramsey

It's a classic scene. Was it Christie Brinkley? I think so. I think so, yeah. I re-watched it recently. Yeah, the audience has given me a nod, so Trivial Pursuits got it, okay. And so that's pride, you know, and I've done that one. When you buy crap, and Rachel's thing she posted, and you wrote about it in your new book that we haven't, oh, we haven't told anybody about that yet. Oh, secret.

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720.365 - 729.174 Dave Ramsey

I just finished the manuscript last week, and it's really good. But you talked about it, and she said, would I buy this if no one ever saw it?

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729.194 - 729.895 George Campbell

Oh, yeah.

729.875 - 759.661 Dave Ramsey

That's your test on the pride button, right? It's a gut check. Greed is not like, it's not like, you know, Simon Legree and Scrooge McDuck and I'm stacking coins in the cave. That's not greed. Greed is I'm just money motivated to the exclusion of other things that are healthy. You can have a money motivation and not be excluded to the exclusion of other things.

760.121 - 780.722 Dave Ramsey

But if your only button to push is money, that's great. And you're always going to step in the do when you do that. And the third one I love you said is desperate. That's the worst one. God, that one right there. Man, the other two, I got over the other two by the time I was like 27, 28 years old.

780.702 - 807.183 Dave Ramsey

That desperate one, that's when people, you know, I'm going to take the trip to Vegas and I'll hit and that'll save my business. When you get desperate, just about 20 seconds later after I get desperate, I get stupid. And right after I get stupid, I get broke. Right. I mean, it's crazy how that's a progressive causal thing. Desperate leads to stupid leads to broke.

807.603 - 816.919 Dave Ramsey

When you go, oh, I've got it's the only way it's my only you're about to screw up when you get in your drama queen gets to kick it in. You're about to screw up.

Chapter 4: What lessons can be learned from past financial mistakes?

945.292 - 951.801 Dave Ramsey

That was personal. There's too much authenticity in this segment. All right. Jim is in Tulsa. Hey, Jim, how are you?

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I am doing good. Nice to talk to you.

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955.573 - 957.895 Dave Ramsey

You too. How can we help?

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957.915 - 987.822

Yes, sir. Uh, I have a, what would Dave do in my shoes? Uh, at age 62, I have, uh, been divorced four years and four months, pretty much a divorce that just basically left me pretty much on the street homeless. Uh, I've been living with a family member in a one room house, uh, one room in a house. And, um, I have been basically getting on your plan since then.

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988.022 - 1017.421

I'm having to pay child support alimony and trying to get my life back in order and have been on your plan, um, pretty much intense up until, uh, just last week. Uh, I have, um, accumulated, uh, quite a bit of wealth. And I'm just trying to get an idea in moving into, uh, you drove by being on the street to accumulated wealth.

1017.461 - 1020.244 Dave Ramsey

Like nothing just happened. What happened? Okay.

1020.885 - 1040.428

Well, in intense, I, uh, been saving basically my budget plan since I've been living, you know, since divorce, uh, has been basically spending $1 for every $2 I've saved. And at this point, on closing last Friday, I was worth $1.158 million.

1043.277 - 1046.642 Dave Ramsey

You did that in four years from the street?

1046.662 - 1047.083

Yes, sir.

Chapter 5: How do you stay committed to a long-term financial goal?

3434.093 - 3438.049 Dave Ramsey

Just after that, boom. We're not going to knock out the car and get the house knocked out too.

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3438.25 - 3442.568

Yeah, we knew it was going to be a long journey with income like that, but we knew it was going to be worth it.

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3443.729 - 3446.573 Dave Ramsey

Well, you set a goal and stuck with it. That's pretty impressive.

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3446.733 - 3452.661 George Campbell

I'm just impressed you stuck with changing the CDs out to get through all the lessons. It's very impressive.

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3453.603 - 3456.567

That was a lot. We had the whole big box in the back of the car the whole time.

3456.587 - 3468.403 George Campbell

Wow. So how do you stick with it for nine and a half years? Most people, if they're 21 years old, they're going, I can't do anything. 10 years? Are you kidding me? I'll find another one. I'll be 31. I'll be ancient.

3468.383 - 3485.8

Well, to be fair, when we first started it, we had the plan to pay the house off in six years. That was going to be it. We had it all planned out. We got to the point in our mid-20s where we really sat down and talked about it and said, you know, we want to do this. We want to knock this out and create a good future for our children. We've got to have those children.

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So we decided to reallocate some money elsewhere and start to work on our family. Now we've got two beautiful little boys. But even through all that, we just barely slowed down a little bit and just killed it as much as possible. So we added three years on, but we got two perfect boys out of it.

3499.687 - 3526.032

i think what carried us through that 10 years was teaching fpu there for about three years and also just like you said the little engine that could that's kind of what i said last night that's what got us through we had that goal and we did not stop and if he got weak i was strong and if i got weak he said no we have a goal and we stuck to it very cool we knew the future that was coming uh whether we did or whether we didn't so we wanted to uh see the one where we are debt free

Chapter 6: What role does teaching Financial Peace University play in accountability?

3550.418 - 3558.406 Dave Ramsey

Well, that's what ends up happening. Because there's a shared pain, a shared victory, a shared goal, and that makes permanent ties. Lifetime friends many times.

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3558.587 - 3569.118 George Campbell

And you can't talk to a lot of people about this stuff because they get weird. They'll shame you. They go, I have student loans. You're trying to judge me. And you guys have created this amazing community of people who want to get better with money and aren't scared to talk about it.

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3569.138 - 3573.583 Dave Ramsey

Yeah, that's pretty cool. Yeah, because I would have to say, yes, I am judging you.

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3573.603 - 3575.176

Yeah. I've said that a few times.

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3575.836 - 3597.817 Dave Ramsey

That's why Dave couldn't coordinate classes anymore. It's too awkward. Yeah, I'm judging you. Yes, I am. That's kind of what I do for a living. That is so cool. Way to go, guys. I'm so proud of you. Your sister that brought you to the FPU class has got to be bouncing off the walls. That's got to be neat. Did she keep up with it, too? Yeah. All right. Got the whole family going. Yeah. I love it.

3597.917 - 3599.399 Dave Ramsey

Way to go, you guys. Way to go.

Chapter 7: How does being debt-free change family dynamics?

3599.459 - 3600.72 Dave Ramsey

Very, very proud of you.

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3600.7 - 3626.185

how's it feel 31 years old it's amazing little boys not have any payments in the world yeah the freedom is unreal it took us months to uh to really let it all settle in just every day looking at each other and just smiling and knowing we're debt free we don't have to worry about our children struggling with this or seeing mom and dad going through the stresses of finances anymore and it's just it's so great to wake up every day and know that you don't have to put that on your children anymore

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3626.249 - 3647.127

amen it's crazy our oldest this summer he's he was there he went to the bank with us he helped us sign the last check he helped how old is he he's six he'll he'll remember it then he set up an homemade ice cream and lemonade stand this summer he did it twice and he made 850 bucks oh i'm franchising that wow yeah that's impressive they catch it incredible

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3647.107 - 3656.769 Dave Ramsey

They catch on. They really do. And when you change your family tree, you do more than just change the math. Everything's changed in the spirit. Everything's changed in their character. And that six-year-old will remember that.

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3657.27 - 3663.765 George Kamel

He'll tell his grandkids, yeah, I was there the day mom and dad paid dad off. Yeah, I remember back in the day. We had these things called banks.

3663.745 - 3665.368 Dave Ramsey

Yeah, that's what'll happen.

3665.508 - 3667.151 George Kamel

It was a piece of paper called a check.

3667.372 - 3684.623 Dave Ramsey

I mean, check is, son. Yeah, that's what'll happen. You changed it. I mean, the whole thing's going to be new. That's the old man sitting there as a multimillionaire. That's pretty cool. Well done, you guys. Thank you. Hey, we got Baby Steps Millionaires, the book for you. That's where you're headed for sure. Total money makeover to give away to one of your class participants and another class

3684.603 - 3692.557 Dave Ramsey

Membership to Financial Peace University. You can give that away and get somebody in one of your classes. You guys keep teaching, keep leading. Way to go. Thank you so much.

Chapter 8: What are the key takeaways for achieving financial peace?

3692.577 - 3713.676 Dave Ramsey

We're so proud of you, heroes. Well done. Very well done. All right, bring the kiddos in. Let's introduce them and hear their ages. All right, what's six-year-old's name? This is Ryan. Ryan, the $800 ice cream man. Way to go, Ryan. And? This is Bradley. Bradley is how old?

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He's just about to be two.

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3715.559 - 3720.668 Dave Ramsey

All right, way to go, Bradley. Well done. What do you all tell people the key to getting out of debt is?

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Finding contentment. Knowing that you don't have to have what everyone else has and you can find joy in the life that you've built and stick into that goal.

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3729.104 - 3734.134 Dave Ramsey

I'm kind of looking at a picture that looks like contentment. I'm about to cry right now. This is beautiful. Yeah, this is well done.

3734.194 - 3737.019 George Campbell

You got way more than they have because you got financial peace, my man.

3737.059 - 3767.289 Dave Ramsey

Way to go. Very, very cool. Beautiful, beautiful. Kyle and Tiffany, Ryan and Bradley, Dayton, Ohio, $157,000 paid off car and house. They're officially weird people. Nine and a half years it took them making $20,000 to $50,000. They're 31 years old, 100% debt-free, house and everything. Hear me, people. This can be done. These guys are dropping a mic on you right now. You got to love it.

3767.33 - 3772.8 Dave Ramsey

Count it down, guys. Let's hear a debt-free scream. Ready? Three, two, one.

3772.84 - 3778.275

We're dead free!

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