Change Your Habits, Change Your Life

SPEAKER_1 (0:05)

Brought to you by the EveryDollar app. Start budgeting for free today.

George Kamel (0:15)

Normal is broken, common sense is weird. So we're here to help you transform your life. From the Ramsey Network in the FAIRWINDS Credit Union studio, this is The Ramsey Show. I'm George Kamel, joined by Dr. John Delony, taking your calls for the next couple of hours at 888-825-5225.

Sarah joins us in Cleveland to kick it off. What's going on, Sarah?

SPEAKER_3 (0:38)

Hi, I was calling. I just have a ton of debt. And honestly, I've made the payments and everything for the last year and a half, but it's gotten to the point now where all my interest rates went up to where my payments have doubled.

And I'm basically, I've made all my payments every month, except for after I make all my payments, I tend to live off of my credit cards because I don't have any cash left on everything. And I just, I don't know how to get out from under my credit cards. This is the first time I missed three credit card payments this month that I didn't get paid. And I just, I don't know how to get out from underneath them.

Dr. John Delony (1:20)

Why didn't you get paid?

SPEAKER_3 (1:22)

No, I got paid. They didn't get paid.

SPEAKER_5 (1:25)

Oh, they didn't get paid, okay.

SPEAKER_3 (1:27)

Yeah, like this is the first time that three of my credit cards didn't get payments. Gotcha.

George Kamel (1:32)

Are you talking about minimum payments?

SPEAKER_3 (1:35)

Yeah, just the minimum payments.

George Kamel (1:36)

Okay, well, let me tell you, if you just make minimum payments, the debt will swallow you whole.

That APR of 29% while you're making a payment of 50 to 100 bucks a month is not gonna touch the balance. So what you need to do is just lay them all out and attack the smallest one and just make the minimums on the rest. Now, it sounds like you were trying to do that, but you're also still using the cards. And that's part of the problem.

SPEAKER_3 (2:02)

Well, one of my credit cards, the payment's $679 a month.

George Kamel (2:06)

Goodness, how much credit card debt is this altogether?

SPEAKER_3 (2:09)

Altogether credit card? That one there is just, that one there, I owe $21,000 on $157.

What's the total, total, total?

George Kamel (2:18)

Give me everything in one bucket.

SPEAKER_3 (2:20)

How much is it?

$21,800, $12,000, $6,000, and $17,800. Those are all my credit cards. Do you have other debt? But I don't know, I do, I have like, I had to get siding on my house, I owe $14,000 for that, and I have a personal loan that was $7,300. I have a mortgage and a car payment.

SPEAKER_7 (2:43)

Wow, are you single?

SPEAKER_3 (2:44)

Yeah, I am.

Dr. John Delony (2:46)

Okay, how much do you make annually?

SPEAKER_3 (2:51)

About $103,000.

George Kamel (2:54)

Wow, well, you're calling us because you're at the end of the rope here. You're going, I can't, I'm starting to miss payments. You weren't making progress before, you were just barely staying afloat, it sounds like.

SPEAKER_3 (3:04)

Yes.

Dr. John Delony (3:05)

All right, Sarah, I want to tell you this, okay? Number one, I'm glad you called. And number two, this is really scary, and we're going to give you a plan that will work 100% of the time if you'll just work it, okay?

But you have to decide, I'm done with this way of doing life.

SPEAKER_3 (3:24)

Oh, I am done. I want to just, because I make fantastic money, and if I didn't have all this debt, I would need.

Dr. John Delony (3:33)

There you go, sister.

That's it. You already are future casting what your life would not only look like, but would feel like, how much peace you would have, how much laughter you would have, like just how well you'd be able to sleep if you didn't have this, because you're working your butt off all week, all month, all year, and then you find yourself getting further and further behind. But it can't be, and again, this is 30 plus years of doing this. It can't be, with the hole you've dug, you have a big shovel, which is great, but you can't partly get out. You have to decide, I'm all in, or we'll love you and we'll just say best of luck to you, and we'll still be friends and all that, but you have to make the choice, and I'm calling you out, make the choice today. I'm going to be done with doing life this way, and that means I'm going to have to be radical, and my friends are going to think I'm weird, and I'm going to do something completely different so that I can make this great six-figure salary doing what I'm good at and what I love, and I want to start loving the life that I have all around that job, right?