"You Have To Stop This!"

[Music] Brought to you by Chm, a biblically based alternative to health insurance. Learn more at chmin ministries.org/budget. Hello, I'm calling today because my husband and I are severely in debt and we are trying to find determine whether or not selling our home would be the best course of action. All right, tell us about it. Okay, so uh well, basically we're roughly $215,000 in debt. that's excluding our mortgage. What kind of what kind of debt is it? Uh so 115,000 of it is student loans. Uh roughly 50,000 is credit card debt and then another 485 is uh a home equity loan. Okay. Yeah, I know. It's horrible. It's horrible. What's your household income? Uh about 8,000 a month. Okay. Now, how much was car payments again? We don't have car payments. You don't have car debt. You have a a home equity loan. So, what'd you run all this debt up on? What's it all from? Well, full transparency, obviously, that's why I'm calling is is that we bought a new house a few years ago and obviously we started using credit cards uncontrollably and we did a consolidation loan to pay off credit cards. Ah, that's the home equity loan, but it didn't cover all of the home equity loan is to pay off the original debt we had on credit cards, but it didn't cover all of and you didn't stop spending. You're absolutely right. Yes. It was a huge mistake on our part. Okay. So, what's your home worth? The home loan is the mortgage. It's 213,000 for the home that we're currently in. Okay. And the home equity loan again was what? 485. Okay. And what's the house worth? Uh about 375 right now. Okay. All right. Well, you can work your way out of those two things. How much is the credit card debt again? Uh 50. Right at 50. Okay. And you have 115 in student loans. That is correct. Okay. How old are you guys? 48. How do you get $115,000 in student loans at 48? You never paid on them since college? Honestly, very minimal. So, they've just been hanging around. Money we're making for 20 years. The amount of money we're Sorry. Yes. The amount of money we're making now just recently changed probably in the last 5 to seven years. Prior to that, the income was very low. And so, at the time, I mean, it was we were just barely making it. And then obviously when the income changed. Um Okay. When did the income change again? I would say probably in the last 5 years or so. Okay. But you you immediately adjusted your lifestyle up and are spending all of it. Correct. Okay. And now we're seeing that we're just it's it's out of control. And you know, obviously we're thinking about retirement, what we're going to do in the next 15 20 years. And I I don't It's depressing to be honest. Yeah. Can imagine. All right. Um Okay. What the first thing I would do is um the two of you, both of you sit down. What are your cars worth? Uh nothing. They're both 2014. Well, I don't want to say nothing, but they're both 2014 models. I'm gonna say maybe three three grand. Three or four grand. I mean, I'm driving a Ford Focus. He's driving a Dodge Charger. Yeah. Yeah. Okay. All right. Um All right. So, the the answer to the equation is the the the problem here is not the credit card debt or the student loan that's been hanging around. Um the the problem is you guys have never in your married life learned how to live on less than you make and it's caused all of these other things. So the first step is to learn to live on less than you make. Get out all the credit cards and cut them up tonight and you and your husband sit down and open the Every Dollar Budgeting app and fill out a budget that you're going to stick to next month. Then we're going to work extra above the 8,000 and earn some more money. We're going to look around, see what we can sell. We're not going out to eat anytime soon. Like, it's going to be 3 years before you see a restaurant unless you're working there. You're not going on vacation. You are broke people. Broke people don't go out to eat and broke people don't go on vacations. You've got to change this cycle. You don't need any clothes. You've got a bunch. You don't need any toys. You got toys coming out your ears. Motorcycles, seedos, boats, lawnmowers around any of that. No. Okay. All right. Then you I think that's why I'm struggling the most. Well, you've been spending your money on experiences. You've been spending your money on experiences. Those aren't assets. They're problems. But okay. Right. All right. So anyway, so we're going to live on nothing on this budget and we're going to start putting 2,000, then 3,000, then 4,000, then $5,000 a month towards these debts. We're going to list them smallest to largest, and that'll be the credit cards. And we're going to attack them in that order. You're never going to use a credit card again in your entire freaking life. If you do, you're going to retire and eat dog food. You have to turn this around. You have to stop this. You've got a 20 year habit pattern that's going to be very difficult to break. And that's why I'm being so in your face. I need that. We need it. I mean, that we absolutely need it. You can do this. I've seen people do it. But the challenge is it's not like we've been married 20 months and we were stupid. We've been married 20, 25 years doing stupid. So, we got to break those those patterns. And you're not stupid, but you've been doing some stupid stuff. I'm not stupid, but I've done some stupid stuff. Okay? So, we're all in the human race together. Now, you guys have got to make the decisions to say, "That's it. I've had it. We're not living like this anymore." And flip the switch and change right now. and start aggressively attacking this debt, smallest to largest, living on a written budget that both of you are in agreement to. And you start making a game, an emotional game out of how much debt we can pay, how little we can buy and how much debt we can pay and how much debt we can pay. And here's the here's the equation, okay? You start paying $50,000 off a year, that's 48,000 or that's $4,000 a month. If you do that, you're debt free in three years, not counting your house. Should we stop? No. You drove right past that right now? No. I I heard you. You said that we could do within 3 to four years we could have everything paid off if we start throwing $4,000 at it. And that means you're living on nothing. Beans and rice, no life. Your friends think you joined a cult. Okay, that's what it's going to take. All right, you hang on. I'm going to give you the book, The Total Money Makeover, and we're going to give you every dollar premium to help you do this. And if you'll get in that dad gum app that we have built, that is so freaking powerful, it's unbelievable. It will it'll take you by the hand and walk you guys through it. But the two of you both have to commit to no more buying of anything. And yes, Amber, to answer your other question, stop investing. Pause it. Yes, stop investing for sure. Pause it. Even though we got a match, you're crazy. You need to match. You don't have any money. You don't have any money. You got to free up every dollar you can free up and get this done as fast as you can. Wow. Really scary. But you got to get after it. That's how it works. Dave, this is this call I think is more Americans than we want to believe. Oh, it's out. They don't know what to do. 30 years sitting in this chair. Gee. Yeah. Every day. This is the Ramsey Show. 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