"This Is A Good Way To Become Poor"

Brought to you by the EveryDollar app. Start budgeting for free today. Me and my husband kind of got ourselves into a situation with a vehicle. We bought it when we were living with my mom and we thought we could afford it and now the payment's ridiculous and we just don't know what to do about it. How much is the payment? It's $1,300 a month. How long and what's the uh what's the truck what's owed on it in total? We owe I want to say 52 or 58 somewhere around there. First thing you need to do is call. Who's the truck financed with? I honestly I don't remember. Okay call them today and find out what the payoff is if you pay it off this month. Okay I think we checked it the other day and I think they said it was like 56. Okay that's that's what I was asking you what you owed on the truck? Oh yeah. And you weren't sure so you're sure you checked it the other day? Yeah I checked it this month. Okay 56,000 do you have any idea what the truck is worth? Yeah I checked today it's worth like 34. According to who? Kelly Blue Book. On private sale trade-in or what? Private sale. Oh golly when did he get the truck? How long ago? Truck two years ago. Did you have a car that was upside down and you rolled the upside down amount into this deal? No we bought when it was really high we bought the truck for like I don't even remember. What's your interest rate? Ridiculous I think it's 17 percent. Okay your 56 is not your payoff that's not the right number that's the balance that's not the payoff because you have a high a subprime loan and they're giving you the total of all your payments you're not that far upside down on this truck. Okay be more what like fit like what I want to know is what the payoff is today not what the balance is today when you have a rip-off subprime loan they book the loan as the total of all remaining payments that is not your payoff your payoff is not the total of all the payments because it doesn't include all that interest so your payoff is probably going to be 45 you're probably 10 in the hole give or take now what's your household income? Our household income is I'm sorry I'm trying to think like. George here look your phone bill should fit your budget not the other way around enter Boost Mobile their low rates mean you can unlock up to 600 bucks in savings over the so-called big carriers so bring your phone keep your number and pay just 25 bucks a month forever on their unlimited plan guys stop paying more just because you always have head to boostmobile.com slash ramsey to make the switch today based on average annual payment of AT&T Verizon and T-Mobile customers compared to 12 months on the Boost Mobile unlimited plan as of January 2026 see website for full details. Our household income is 56 a month. Okay and what do you make? I make I'm at $20 $19 an hour. What does he make? He's at $26.70. So you guys bring home $5,600 that hits your account after taxes? Yes. And you're working 40 hours? Yeah he works overtime though. Okay in addition to that okay yeah okay and I'm assuming you have no money saved? We so we've been working on the baby steps we have a thousand dollars saved that's good and we've been paying off other debts he just got a big bonus so we paid off a bunch of our credit cards. How much was that bonus? It was like three thousand dollars. Okay do you have a tax return coming or do you know? I don't have a very big tax I have like a hundred dollars coming for my tax return and he has maybe a thousand. Okay all right because you desperately need to get rid of this truck completely get rid of it and you're going to have to pay the difference to do that there's a couple of ways to do that one is save up let's say you're ten thousand in the hole as an example you'd have to have the ten thousand dollars to put with the 34 to get the thing paid off and get rid of it the second thing you can do is you could finance that ten thousand dollars. Okay I'm worried though because we live in a camp trailer and so we need the truck to pull the camp trailer. Sell it all and move into an apartment this is killing you you can't keep this ridiculous butt truck and have some irrationalized reason for doing it and live in a camper you're dying over here you got sell the camper too what's the camper worth? The camper's worth I just looked at it was it's worth $54,000. And what do you owe on it? We just bought it. Oh Jesus. So we have an apartment. Oh my god and so you financed it of course. Yes. And you owe $54,000 on a camper. Yeah yeah we owe $54,000. Okay we're gonna sell everything Claire. Yeah if if I woke up in your shoes I would sell everything in sight and I would clean up this mess and it's going to take you a one-bedroom apartment and you're gonna work like crazy people all the time and you're gonna have no life and it's gonna take you a while because you've made some really really bad financial decisions this truck and this camper are the top of the list and you've got to get this off of you. Five years from now you're gonna have two pieces of junk and still owe 40 grand. Okay. And you'll still be living in a dadgum camper. This is not a good long-term life plan. So no so the plan was we bought the camper because we're fixing up my dad's old house that he gave to us. And then you're going to sell the camper at a loss. Yeah. So you should have moved in an apartment while you're fixing up the old house instead of buying $54,000 or something that's going down in value like the toilet. Yeah. Yeah so that's the plan yeah so and now you're fixing up the house with money you don't have. Yeah. Yeah how much you putting into this house? Well so my dad said he would pay for most of it um we haven't put anything into it yet. Good. Is he living there now? My husband's doing no he has his own house. Okay. My husband's doing all the work on the house himself. Is the house going to be put in your name or is it in your name? Yes. Already? It's not in our name yet which is why we haven't put any money in it. Okay yeah don't don't put money and effort into it until it's in your name. And you've got to you've got to start undoing some of these things so you can you got y'all got a mess and I'm scared for you so um but you've got to read back up and rethink how these stories end before you enter into the story and so we need to begin with the end in mind as Stephen Covey said in the seven habits of highly effective people and you don't buy a $54,000 camper to sleep in that's going to be worth 30 by the time you have get ready to sell it a year from now in order to fix up a house you couldn't use that money to fix up the house and so um you you don't you got to quit buying things that go backward on big payments and um it sounds like you're sacrificing in your head but you're not sacrificing you made a mistake is what you did so you guys have got to get rid of this crap and you know if you can get that house barely habitable and move into it that's what I was you know if the bathrooms on one end don't work or something I don't care if you can get it where it's legal to live in it and the plumbing is functioning and you have a you know a basic kitchen to operate out of and you can fix it up later and get rid of the payments here and start dumping all this stuff this crap that you've got with wheels on it that's going down in value okay folks a general rule of thumb is this um not just for her but for all of us if you want to be poor here's the formula buy a lot of stuff that has wheels and motors on payments boats seadoos four-wheelers motorcycles cars trucks trucks trucks lawnmowers buy a lot of stuff with motors and wheels and put payments on it and you will be poor create your free every dollar budget today the simplest way to budget for your life