Dear Dave,
I work for a small company that just won a cruise trip for all the employees. The prize covers just the cruise tickets, and we have to pay for everything else. The problem is that my wife and I currently have more than $50,000 in debt, not counting our home, and about $10,000 of that is in collections. We’re trying to fix our finances and start saving money, but we just don’t feel like we should take a trip right now. How do I tell my boss?
— Ricky

Dear Ricky,
First, let me say how proud I am of you and your wife. Most people would be really irresponsible in a position like this and simply borrow more money to take the trip. The fact that you’re behaving like mature adults tells me you’re on your way to getting out of debt and solving your financial problems.

I’ve got to wonder, is there a lot of pressure from your company to go on this trip? I understand the benefits of team building and socializing with colleagues, but when you have no savings and are that deep in debt — and a chunk of that includes some in collections — it’s no lie to say you can’t afford to go. A decent company will understand.

Just sit down with your boss or owner, and explain why you can’t make it happen right now. You don’t have to unload all the details, but let them know that you can’t do something like this in good conscience when you’re trying to get your finances under control and already owe a lot of money.

That’s one heck of a temptation you’re standing up to, Ricky. I love that you and your wife are on the same page and have made the decision to take control of your finances together.
—Dave

He set you up

Dear Dave,
I’m a senior in high school, and I have a job after classes and on weekends. I made a down payment of $2,500 on a $7,500 motorcycle last week, because I always wanted to have one before I got out in the real world and had bills and other responsibilities to think about. I asked my dad if that was a smart move, and he said I should ask you. So, what do you think? Should I go ahead with the purchase?
— Tad

Dear Tad,
I’m glad you’re working and learning the value of money and having a job. But I think your dad set you up on this one. I’ve got a feeling he knew what I’d say, and he wanted you to hear it from me.

I teach people how to stay out of debt and build wealth. And there’s always one thing I remind folks of when it comes to buying anything — if you can’t afford to pay cash for the whole thing, then you can’t afford it. The only thing I back off on is when it comes to buying a house.

I love shiny things that go fast, and so do a lot of people who work here at my office. Right now, there are about six or seven motorcycles sitting in our parking lot, and they’re owned by folks who make good money. And the bikes sitting out there probably range in value from about $1,000 to $10,000. But you know what? Whoever rode in on the $1,000 bike had just as much fun as the one who owns the $10,000 bike.

A motorcycle is a toy, and you should always pay cash for toys if you want to be wealthy one day. Having lots of payments and handing your paychecks over to the bank is not the way to build wealth. I would advise talking to the guy at the bike shop to see if you can rework this deal for a ride you can actually afford.
—Dave

— Dave Ramsey is America’s trusted voice on money and business, and CEO of Ramsey Solutions. He has authored seven best-selling books. The Dave Ramsey Show is heard by more than 11 million listeners each week on more than 550 radio stations and digital outlets. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.