[MUSIC PLAYING] Brought to you by the Every Dollar App, start budgeting for free today. Today's question of the day comes from Lauren in Missouri. Yeah, she says, I listen daily and hear the phrase, don't listen to broke people quite often. What is the Ramsey definition of broke? So we know who in our circles not to listen to. I love this question. Well, broke people-- for me, a broke person is somebody who is not financially responsible. And you see that as the fruit in their lives, right? They may have cars in their driveway. They may have the house that's next to yours and they're your neighbor. But you get the sense that they're not managing their money properly. And sometimes, I will say, Dave, it's hard to know because unless you know this person on that financial level, you may not know how they handle their money. But if you see them pull out a credit card when it's time to pay for dinner, if you see that their houses-- if you have an idea of where they work and where they earn and you're taking a look at their houses and their cars, there's certain little indicators that you're going, I wonder what type of-- I wonder how they're managing their money. Now, on a personal level, when I think about broke, I think about paycheck to paycheck. And it's that person where your money's coming in and it's going out, you don't know what you're spending it on. You're not on a budget. And at the end of the day, because of that, you're not able to do the things that cause you to be a financially responsible person. You're not savings. You don't have savings. You're not investing for retirement. You are carrying debt. You're still getting into debt. All of those things that we teach you to do, you're not setting your family up in your children up long term for college and things like that. So that's kind of what I would place it in as far as what I would consider a person being broke or trying to gauge if a person is somebody that you don't want to take advice from. Wealth is not income, wealth is not appearance. So if you're bling bling, you got a purse that costs more than most people's kids. You are driving cars that don't fit the neighborhood, meaning they're too nice. You know, you got two $60,000 cars sitting in front of a $400,000 house. You're broke. And if all your vacations are so nice they're on your Facebook page, you're living, you're trying to put on the dog as we say in Tennessee. You're trying to look like you're something you're not. That is not the definition of wealth. Tom Stanley who wrote the book Million Next Door before he passed away, he wrote another book called Stop Acting Rich. Broke people act rich and aren't. - Yeah, they're trying too hard. - I hesitate to do this 'cause I got a sweet young man sitting here in the lobby with a great cowboy hat on. But in Texas they say, big hat, no cattle. That's broke, okay. Lot of talk, no money. Lot of putting on the heirs, no money. So wealth by definition is net worth. What you own minus what you owe is your net worth. And so if you make $2 million a year and you have nothing in net worth, you're broke. You spend all of it. That's what it amounts to. And so it's not income and it's not what people, it's not stuff that you show on Instagram. And here's the thing, most people that aren't broke don't give a crap what you think. Broke people care deeply about what you think. And so that comes into it 'cause that's why Broke people are always giving you advice 'cause they're afraid that you're gonna outpace them because you're doing smart things. - That's a big indicator right there. The people who are constantly yapping. They got a lot of opinions about other people's stuff and they got no stuff. That's a thing. - That's a big indicator. And so you're typical millionaire, we interview them on the millionaire, baby says millionaire is what's most expensive pair of blue jeans you ever bought, 50 bucks, 100 bucks. And nobody excited about that in the blue jean world. - I don't know, I feel like-- - That's big blue jeans money. - Can I challenge the blue jeans? - Okay. - I don't know it. - I'm just saying, I'm not saying that's an indication of Broke, I'm just saying that-- - Moving on Dave, moving for me. - The typical millionaire when we interview them. - That's true. - And then we say, what did your wife spend? Maybe 100 bucks, okay, but still they just don't, they're not majoring in appearances and broke people generally major in appearances. They try to look like they are something they aren't. And then they have opinions about your money that are unsolicited, you didn't even ask, but they got a lot to say about it. And it's sometimes in your family. And here's the other thing, here's what broke people are. Most people, that's broke people. 78% of Americans live paycheck to paycheck. That's eight out of 10 houses on your street are spending everything they make to stay afloat. - Wow. - So what's a broke person? Most people, that's broke people. Most people, when you pull up a stoplight and five nice cars sitting around you, you're looking at five car payments. You're not looking at some millionaire that rolled up there, you know, he's sitting in a $56,000 pickup truck with a dad gum $854 payment on it. - But Bogota got me a truck. - You know, a work hard I deserve. What, you deserve what, a payment? - A payment. - Give me a break, dude, seriously. And so that's, you know, so our definition of broke people would be, of wealthy people would be net worth. And you don't get net worth by only earning an income. And you don't typically get net worth by giving a rip what other people think. And so putting on, putting your vacations on Facebook, putting your purse, your bling, your, I don't know, whatever it is, whatever it is that you think other people might think and be impressed with you. Your car, for sure, your stupid car. This is the country where cars, the United States of America, cars are a status symbol. - 100%. When I walk through, when I walk through my neighborhood, when I see cars, I just see the payment amount. - That's all I see. - Have you seen the thing that the guy did, it's old, but you are your car. And he goes like, okay, this person is a Subaru. And this person is a, oh, it's hilarious. Because you're like making a statement about who you are. I mean. - That is true. - So I'm not sure what I am. I'm an old Corvette, I guess, but there you go. But the, or I might be a Raptor, but somewhere in there, 'cause I have two of my cars. But anyway, so, but it's, yeah, the cars are. - You used to be a Jaguar. - I used to be a Jaguar. (laughing) - I'm not gonna do it. (laughing) - That's it. Is that like a, is that like a broke cougar? Is that what a Jaguar is? - I think so. (laughing) A male broke cougar is a Jaguar. - Listen, when I go by apartment complexes and I see. - Yeah, they're sitting in a stinking apartment complex and there's a $40,000 car sitting out there. - I'm like, this is a business. - That is definitely broke people. - Yeah, it doesn't exist. - 100% that's broke people. Okay, so yeah, that's what you're talking about. And I can't tell if this question's a little bit facetious or not, but we're giving you a serious answer anyway. - Mm-hmm. - So, yeah, so the answer is don't listen to most people. - Yeah. - 'Cause most people are broke. - Most people don't know. - And don't listen to people who are putting on images of wealth because they probably don't have any. And really, you get to know someone well enough, you actually know what their net worth is. You go, this guy's 35 years old. He's got a $2 million net worth. Okay, that's a guy you can listen to. - Yeah, and he's, when you line that up, that person is not spending the way you think that a, quote, rich person should spend. They're just not. - They don't. - There's a reality to it where it's like, hey, this money is an investment. You're just living a normal life. - Yep. - Yep. - You know? - Very weird. - That's okay, it's an interesting discussion though. - Yeah, if broke people are making fun of your financial plan, you are on track. That's one of the things we always say is a great joke line. - Yeah. - And it's like if fat people are making fun of your diet, then you're right on track. You know, it's the same deal, right? And so, if you've been divorced 62 times, I hope this next marriage works for you, but I don't want to read your book on marriage. You ain't got this figured out, Bubba. And so that's the deal. And that's what we're looking at. It's a proof text in the marketplace. Because in business, we would call it best practices. I want to follow someone that has a series of habits that has caused them to win in this particular area of my life I'm concerned about. So if you want to be married and have a great marriage, find somebody that's been married 67 years and find out if she didn't kill him. It's a good thing, man. You need to know these things. That's smart, smart. Create your free every dollar budget today, the simplest way to budget for your life.
